hey dibs I agree with chicken. retail investors are trying to pay bills. when we tick up to 10% unemployment, people will be more likely withdrawing 401K funds than doubling down.
the zero sum argument is correct. at the end of the string of buyers and sellers, companies raised money through stock offerings and burned it, instead of actually creating the dividends that are supposed to justify the prices they got for the shares.
I don’t understand “Where do you think it has all gone…mortgages, car loans,”…value has been torched, everything’s for sale, people are working less and spending less…the whole motor has downshifted, and companies can’t create profits like we thought they could when they were running on crack in the credit boom, or running on crack in the dot-com boom.
1997 levels make a lot more sense, and that’s optimisitic: 1997 was still a year after greenspan played the “irrational exhuberance” card.
Only going into those that benefit from yen depreciation. Komatsu (6301) & Hitachi Construction (6305) as well. It’s a trade. Buy Nomura tomorrow after the dilution is factored into the shares.
Your yen trade is working because Japan has undertaken to sytematically weaken the yen so its exports can remain competitive for what remaining demand there is.
Not familiar with your China trade – are you long or short?
The market will turn in fits and starts – just don’t misread it as greed returning. With what is effectively the most liquid market in the world, stocks are constantly being pulled by opposing forces. Has there been any groundbreaking news in the last two weeks that couldn’t have been anticipated? If not, then your thesis would have held true two weeks and 13% ago.
Look at the numbers for yourselves. My Yen trade is working, my China stocks are working. this market will turn soon and it’s be fast, strong and scary. Greed will return.
Don’t give me that zero sum crap either. You have no idea how much liquidity is out there. Where do you think it has all gone…mortgages, car loans, ROTFLMMFAO.
“The amount of money on the sidelines will drive the equity market.”
I’ve been hearing that line for the last 2 years and I’ve been shorting all the way down.
It’s not that the argument is flawed, it’s that fear is driving the market right now. The guy that has moved to cash has not done so because he’s looking to play, he’s done it so he has money to live off if he gets made unemployed.
Sure, the market will rebound but there’s nothing stopping it going down another 50% first.
here’s the rub: asset value is not a zero-sum game. the fact that stocks are down does not mean that there’s an amout of cash somewhere equivalent to the losses, waiting to be re-invested. the value is just gone. those redemptions were taken at a loss.
Imagine a market for VCRs — if no one wants them any more, they are all just worth less. there’s not some magical “guy who was short” who is ready to start pumping money into VCRs again.
the sources for cash would be other assets (like people’s houses) and their income, neither of which are providing a lot of dry powder any time soon.
further, institutional investors were using leverage to invest (eg hedge funds). with HF bankreuptcies and new leverage rules, that value support is gone for good.
dave are you a day-trader?
hey dibs I agree with chicken. retail investors are trying to pay bills. when we tick up to 10% unemployment, people will be more likely withdrawing 401K funds than doubling down.
the zero sum argument is correct. at the end of the string of buyers and sellers, companies raised money through stock offerings and burned it, instead of actually creating the dividends that are supposed to justify the prices they got for the shares.
I don’t understand “Where do you think it has all gone…mortgages, car loans,”…value has been torched, everything’s for sale, people are working less and spending less…the whole motor has downshifted, and companies can’t create profits like we thought they could when they were running on crack in the credit boom, or running on crack in the dot-com boom.
1997 levels make a lot more sense, and that’s optimisitic: 1997 was still a year after greenspan played the “irrational exhuberance” card.
Only going into those that benefit from yen depreciation. Komatsu (6301) & Hitachi Construction (6305) as well. It’s a trade. Buy Nomura tomorrow after the dilution is factored into the shares.
fair enough – at least you’re putting your money where your mouth is.
Getting out of China now is a good call in my opinion. Going into Japan not so good.
Was long CAF and 2823 HK since Jan 1. Selling them now and buying Japan stocks and the Yen. Bought a lot of Nintendo friday.
Your yen trade is working because Japan has undertaken to sytematically weaken the yen so its exports can remain competitive for what remaining demand there is.
Not familiar with your China trade – are you long or short?
The market will turn in fits and starts – just don’t misread it as greed returning. With what is effectively the most liquid market in the world, stocks are constantly being pulled by opposing forces. Has there been any groundbreaking news in the last two weeks that couldn’t have been anticipated? If not, then your thesis would have held true two weeks and 13% ago.
Look at the numbers for yourselves. My Yen trade is working, my China stocks are working. this market will turn soon and it’s be fast, strong and scary. Greed will return.
Don’t give me that zero sum crap either. You have no idea how much liquidity is out there. Where do you think it has all gone…mortgages, car loans, ROTFLMMFAO.
“The amount of money on the sidelines will drive the equity market.”
I’ve been hearing that line for the last 2 years and I’ve been shorting all the way down.
It’s not that the argument is flawed, it’s that fear is driving the market right now. The guy that has moved to cash has not done so because he’s looking to play, he’s done it so he has money to live off if he gets made unemployed.
Sure, the market will rebound but there’s nothing stopping it going down another 50% first.
dave i want whatever you’re taking.
here’s the rub: asset value is not a zero-sum game. the fact that stocks are down does not mean that there’s an amout of cash somewhere equivalent to the losses, waiting to be re-invested. the value is just gone. those redemptions were taken at a loss.
Imagine a market for VCRs — if no one wants them any more, they are all just worth less. there’s not some magical “guy who was short” who is ready to start pumping money into VCRs again.
the sources for cash would be other assets (like people’s houses) and their income, neither of which are providing a lot of dry powder any time soon.
further, institutional investors were using leverage to invest (eg hedge funds). with HF bankreuptcies and new leverage rules, that value support is gone for good.