Official Stock Market & Economy Thread

[dey know yayo]

oil has been doing really well the past few weeks and it's mean contango is quickly disappearing. we could have backwardation within a month or two and Ithink USO is a great way to play that, it could spike up and start to mimick crude a lot better again as contango eases up. afteer the next sell off, oilstocks may be ready for big gains too. uso will see $35 very soon.

CDS clearinghouse passed. should be interesting to see the new dynamic of credit markets.

silver has been in backwardation for a week or so now. gold and silver may make big moves up again soon.

lloyds (lyg) is now majority state owned by the UK govt.

got stopped out of my euro trade for a small loss. will be waiting for next opportunity.

wawaweewa i think youre right about suspending or terminating M2M perhaps softening the big move down that could be coming and catalyzing a potentialintermediate term bottom.

 

[freakydestroyer]

when do you expect the pullback on SRS, and when do you expect it to shoot up?

 

[dey know yayo]

im guessing pullback early to mid this coming week and starts shooting up later in the week, around thurs or fri. the charts will tell us what its actuallygoing to do.

 

[reigndrop]

Originally Posted by foodgoeshere

Originally Posted by reigndrop

Originally Posted by wawaweewa

Yayo,

What do you think about this March 12th mark to market hearing. The timing is pretty nutty considering that we're on the verge of a massive drop again.
I doubt they suspend M2M before a crash but if they do, do you think it'll be bullish for the market considering it won't change anything fundamentally in relation to actual debt levels and insolvency. Asset levels aren't coming anywhere near peak levels for decades (in real terms). Or do you believe that the event that catalyzes a crash will overshadow.

I might be nuts but I think they know a crash is coming and they'll suspend M2M after the crash to put in a somewhat sustainable bottom.
It's interesting that after all these months they have set a hearing now for M2M which is telling.

Funny how I was emailing a colleague about this this morning, and I have my doubts about them suspending it also. First off, if they do indeed suspend it next Friday, what will they revert too then to value assets? This administration has proven that it has no plan yet in regards to the banks, so for it to have some sort of plan in regards to M2M would be eyepopping. That's the biggest pet peave right now, they might suspend it, but unless they have plan to revert to some other method of accounting in the near term, the market will not be bullish.

It's hard to believe that they'll have anything planned. Wasn't the lack of mark to market the reason financials got in trouble in the first place? If anything I think that a suspension will only cause a minor bear rally then crash. A suspension would be temporary good news for the market, but I think capitulation will come following more bad news.

Quoted from house.gov:

Washington, DC - Congressman Paul E. Kanjorski (D-PA), Chairman of the House Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises, today announced that the Subcommittee will hold a hearing to examine the mark-to-market accounting rules that many contend have exacerbated the current troubles in the financial industry and in the broader economy. The standard requires companies to value assets they hold at current market values. For assets that are frozen and have a diminished current market value but may recover value in the future, the standard has proven problematic. Companies are then forced to write-down billions in assets, which can lead to further write-downs elsewhere.
"Illiquid markets have resulted in great difficulty in valuing sizable assets. Some have therefore complained about fair value accounting and sought to eliminate it. While companies need stability, investors still need accurate information. We therefore cannot allow for fantasy accounting that wishes away bad assets by merely concealing them," said Chairman Kanjorski. "As a result, we will seek at this hearing to engage in a constructive, thoughtful conversation with a diverse range of viewpoints aimed at identifying fair-minded, incremental, and achievable fixes to this problem. In short, I want to find a way - within the existing independent standard-setting structure - to still provide investors with the information needed to make effective decisions without continuing to impose undue burdens on financial institutions. Each of our anticipated witnesses will have the opportunity to contribute as we all pursue consensus solutions together to this thorny, contentious issue."

No, it was M2M that in sense has destroyed our banks. As people began defaulting on their loans, banks took up a lot of assets, and as asset prices declined,the assets had to be written down on the bank's balance sheets, essentially creating a "loss" each quarter when the release earnings, whennothing had really happened except for a decline in price. You're mistakening M2M, with Enron, it was lack of M2M that destroyed Enron and itsshareholders.

 

[foodgoeshere]

Thanks for clearing that up reigndrop, it makes the Kanjorski much clearer to me now lol.

 

[nicefro]

Originally Posted by reigndrop

No, it was M2M that in sense has destroyed our banks. As people began defaulting on their loans, banks took up a lot of assets, and as asset prices declined, the assets had to be written down on the bank's balance sheets, essentially creating a "loss" each quarter when the release earnings, when nothing had really happened except for a decline in price. You're mistakening M2M, with Enron, it was lack of M2M that destroyed Enron and its shareholders.

I knew what M2M was but that cleared up a lot.

But in essence, it was a loss, because if the asset is losing value, if you want to liquidate you can only do so at that value.

Deteriorating assets won't help you if they're worth nothing, then you depend on a surge in housing prices to pick up value; and that can't happenif the market is flooded with foreclosed properties.

 

[thaisativa1]

DNY, how much money did you start with?

 

[superantigen]

Originally Posted by thaisativa1

DNY, how much money did you start with?

I remember him saying 8g's a while back...

Funny thing is that, I started out with 8g's myself...and i sure as heck don't have the amount he has now...

...

 

[thekryptonite]

that's crazy how much money he has made, especially to start off with just 8g's..

 

[mw2889]

In the "How to Make Bank" thread, DKY recommended shorting AMR. I thought you aren't allowed to short stocks under $5, am I missing something?

 

[timelessflight]

How little is too little to start? I'm looking at the <$1,000 range to start?

 

[andycrazn]

what was the book dky suggested to read in terms of investing? i need to cop it

 

[foodgoeshere]

Originally Posted by andycrazn

what was the book dky suggested to read in terms of investing? i need to cop it

He recommended "TechnicalAnalysis of the Financial Markets" by John J. Murphy.

 

[cronicmole]

Originally Posted by TimelessFlight

How little is too little to start? I'm looking at the <$1,000 range to start?

 

[nicefro]

ATTN: Anyone looking to start!

Do not start with less than $2,000

Trading without margin was one of the worst decisions I've made regarding trading. I would highly not recommend it, you have to wait for money to clear anda whole bunch of other %##%.

Dun do it.

 

[jordan23collecta]

^^

very good info right there..i just got done telling my friend not to invest in gold unless you dont need the money for 2-3, possibly 5 years...



-J23C

 

[andycrazn]

Originally Posted by foodgoeshere

Originally Posted by andycrazn

what was the book dky suggested to read in terms of investing? i need to cop it

He recommended "Technical Analysis of the Financial Markets" by John J. Murphy.

WOW i found that on the street one day............. and i threw it out......
but il cop all 3 books. thanks alot

 

[freakydestroyer]

Originally Posted by Dey Know Yayo

im guessing pullback early to mid this coming week and starts shooting up later in the week, around thurs or fri. the charts will tell us what its actually going to do.

cool, thanks. How did you come up with this prediction?

 

[dey know yayo]

crystal ball.

 

[dey know yayo]

Goldman Sachs (GS) is looking very bearish and I think it is due for a very large discount from current levels, as isMorgan Stanley (MS) and Northern Trust (NTRS). GS is my favorite short here and Iwill be putting in a lot of money into bearish positions against it.

HSBC (HBC) keeps getting killed, as do other European banks, like UBS (UBS) andDeutsche Bank (DB). Credit Suisse (CS) is approaching a technical breakdown andthis stock could trade much, much lower in the next two weeks. Watch CS especially.

Apple (AAPL) and Google (GOOG) are also showing bearish symptoms, as are fertslike Potash Corp. of Saskatchewan (POT).

I expect a big sell off beginning later this week.

Crude's contango is quickly easing up, and it may have bottomed. I think it is at a point where I will consider it a buy on pullbacks. Energy stocks haveyet to make bullish patterns, however. The US Oil Fund ETF (USO) may start rising quickly from here as contango eases upand its crude futures holdings bring it back to a closer correlation with actual crude prices. It could be around $35 very soon.

 

[dey know yayo]

Goldman Sachs (GS) is precariously perched between a bullet and a target. It is becoming increasingly clear that lastyear's AIG bailout was also a Goldman bailout. According to a recent WSJ article,Goldman got $6 billion of AIG bailout money last quarter. This confirms earlier rumors that the $20 billion "hedge" Goldman executives keeptrivializing was very dangerous toxic asset exposure. So much for being the first (or second or third) bank to repay TARP money.

This news should lead to selling and a credit rating cut in coming weeks, and the markets responded on Friday with a large sell-off on high volume rightthrough Goldman's 50DMA. Institutions are selling.

Goldman is in an ascending channel and its support line is the next line to break before the big breakdown. I expect GS to be in the 50s at least by the end ofthe month.

 

[reigndrop]

FYI, WTI has begun trading at a premium over Brent again, as it should.

 

[dey know yayo]

DB CS GS so toast.

 

[tsman]

DKY. are you entering bearish positions now on these financials, or do you see these as being immune from the short term bounce we may see this week.

 

[shake n bake718]

Does anyone know which companies will benefit the most from the increased funding for stem cell research? Would it seem like a good idea to invest in any ofthem if they are publicly traded?