Comments on: Analysts Expect Reports on Spending, Home Sales to Show Decine in November http://www.nakedcapitalism.com/2008/12/blog-post.html Sun, 22 Nov 2009 07:56:24 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Anonymous http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30104 Anonymous Sun, 21 Dec 2008 19:40:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30104 Stocks, equities, markets, funds, yield curves yadda yadda . . .<br/><br/>It's JOBS, stupids. Stocks, equities, markets, funds, yield curves yadda yadda . . .

It’s JOBS, stupids.

]]> By: Lune http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30101 Lune Sun, 21 Dec 2008 18:50:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30101 Glen-<br/>I wouldn't put much stock in those Q409 predictions. If you notice, whenever an "analyst" has no clue when something will happen, they'll predict somewhere between 6 to 12 months. Why? It's far enough away that one can't ask for evidence of the change right now (e.g. if you were to predict the market is going to turn around next month); it's far enough away that most people will forget your prediction when the time comes; it's soon enough that people find comfort in your prediction and therefore won't challenge it; plus, everyone is making the same prediction, so there's safety in the herd.<br/><br/>If you look back, every single economist who didn't predict the start of this crisis, has been confidently predicting the end of this crisis within "the next 6-12 months". This has been going on since at least the beginning of 2007.<br/><br/>It's an old trick that plenty of "experts" use in everything from financials to foreign policy (when's the Iraq War going to end? Yep 6-12 months in the future, ever since 2003) to sound knowledgeable when you have no clue. Glen-
I wouldn’t put much stock in those Q409 predictions. If you notice, whenever an “analyst” has no clue when something will happen, they’ll predict somewhere between 6 to 12 months. Why? It’s far enough away that one can’t ask for evidence of the change right now (e.g. if you were to predict the market is going to turn around next month); it’s far enough away that most people will forget your prediction when the time comes; it’s soon enough that people find comfort in your prediction and therefore won’t challenge it; plus, everyone is making the same prediction, so there’s safety in the herd.

If you look back, every single economist who didn’t predict the start of this crisis, has been confidently predicting the end of this crisis within “the next 6-12 months”. This has been going on since at least the beginning of 2007.

It’s an old trick that plenty of “experts” use in everything from financials to foreign policy (when’s the Iraq War going to end? Yep 6-12 months in the future, ever since 2003) to sound knowledgeable when you have no clue.

]]> By: Bob_in_MA http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30100 Bob_in_MA Sun, 21 Dec 2008 18:45:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30100 "I don't pretend to have any feel for markets, but I was struck earlier in the month how the stock market shrugged off almost all bad news..."<br/><br/>I took this as the rally so many expected after the precipitous plunge in the markets and the spike in the VIX. The dow didn't return to 10,000, but it did manage to stabilize and even go up some on really bad news. If the news had been more equivocal, maybe the Dow would have gone to 10,000. “I don’t pretend to have any feel for markets, but I was struck earlier in the month how the stock market shrugged off almost all bad news…”

I took this as the rally so many expected after the precipitous plunge in the markets and the spike in the VIX. The dow didn’t return to 10,000, but it did manage to stabilize and even go up some on really bad news. If the news had been more equivocal, maybe the Dow would have gone to 10,000.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30096 Anonymous Sun, 21 Dec 2008 18:03:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30096 "We can't solve problems by using the same kind of thinking we used when we created them."<br/> Einstein “We can’t solve problems by using the same kind of thinking we used when we created them.”
Einstein

]]> By: gloomboom.com http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30091 gloomboom.com Sun, 21 Dec 2008 17:03:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30091 I think the market is just numb after all the shock and awe. Now we have Madoff and his mendacity to factor in. He was a big player and has added a tremendous amount of uncertainty, if more uncertainty is possible. <br/>Now we have Obama coming into office in one month and he is clearly as clueless as Bush. I think his advisers are going to pretty much follow the Paulson plan and that means Japan all over again. More uncertainty! I think the market is just numb after all the shock and awe. Now we have Madoff and his mendacity to factor in. He was a big player and has added a tremendous amount of uncertainty, if more uncertainty is possible.
Now we have Obama coming into office in one month and he is clearly as clueless as Bush. I think his advisers are going to pretty much follow the Paulson plan and that means Japan all over again. More uncertainty!

]]> By: Kafka http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30086 Kafka Sun, 21 Dec 2008 16:24:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30086 As far as I am concerned, there is only one way to trade the markets. Figure out the lies and profit while limiting your losses. Though stupidly simple and easy to implement, most find the methodology distasteful. You know the financial statements of most big companies are full of lies and easy to discern with a little effort. You know most of the Politicos and their corporate bag men are liars. You know most government stats like GDP, Unemployment, CPI, National Wealth, projected budget deficits are complete shams. Some say it is bad, I say thanks. What amazes me is the Politicos and their corporate bag men have been lying to Americans for their entire lives yet most idiots in this Country still believe, from that one can profit. The math is simple yet no one does it, For example, GM is gonna get bailed out, so its share price rises, why? Is GM no longer insolvent? Has GM fixed its unsustainable business model? During GM’s life span it has lost over $60 Billion and that is without adjusting for its fraudulent accounting practices, thanks GM, you made my month. Many suggest the dollar as the reserve currency of the world will continue to strengthen with unsupportable tenuous arguments like the best of the worst, where is the math? The math medium term shows the strong dollar premise to be virtually impossible (absent connived War). What the blank is going on with Treasuries, best long term trade I ever made and am still making is shorting 10 year Treasuries with durations of 7 years or more remaining, investing proceeds in foreign government bonds with similar durations and higher yields and hedging out the currency risk (though playing the bounces). It is guaranteed Treasuries are the next bubble and if not, convexity rules the day such that the spread is always profitable and the only risk is bankruptcy of the foreign governments. Gaming the liars is the most fun and profitable way to trade, hope and optimism are for losers as math always wins in the end. You can not beat a liquidity trap especially when the solution is more debt. As far as I am concerned, there is only one way to trade the markets. Figure out the lies and profit while limiting your losses. Though stupidly simple and easy to implement, most find the methodology distasteful. You know the financial statements of most big companies are full of lies and easy to discern with a little effort. You know most of the Politicos and their corporate bag men are liars. You know most government stats like GDP, Unemployment, CPI, National Wealth, projected budget deficits are complete shams. Some say it is bad, I say thanks. What amazes me is the Politicos and their corporate bag men have been lying to Americans for their entire lives yet most idiots in this Country still believe, from that one can profit. The math is simple yet no one does it, For example, GM is gonna get bailed out, so its share price rises, why? Is GM no longer insolvent? Has GM fixed its unsustainable business model? During GM’s life span it has lost over $60 Billion and that is without adjusting for its fraudulent accounting practices, thanks GM, you made my month. Many suggest the dollar as the reserve currency of the world will continue to strengthen with unsupportable tenuous arguments like the best of the worst, where is the math? The math medium term shows the strong dollar premise to be virtually impossible (absent connived War). What the blank is going on with Treasuries, best long term trade I ever made and am still making is shorting 10 year Treasuries with durations of 7 years or more remaining, investing proceeds in foreign government bonds with similar durations and higher yields and hedging out the currency risk (though playing the bounces). It is guaranteed Treasuries are the next bubble and if not, convexity rules the day such that the spread is always profitable and the only risk is bankruptcy of the foreign governments. Gaming the liars is the most fun and profitable way to trade, hope and optimism are for losers as math always wins in the end. You can not beat a liquidity trap especially when the solution is more debt.

]]> By: lineup32 http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30085 lineup32 Sun, 21 Dec 2008 16:23:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30085 continued decline in oil prices is creating widespread losses throughout investment land. Another can't miss narrative generated by the financial press based on liquidity and speculation rather then fundamentals unwinds quickly with steep losses. A barrel of oil in 92 averaged $11 by 2000 it was in the low $20 enough said. continued decline in oil prices is creating widespread losses throughout investment land. Another can’t miss narrative generated by the financial press based on liquidity and speculation rather then fundamentals unwinds quickly with steep losses. A barrel of oil in 92 averaged $11 by 2000 it was in the low $20 enough said.

]]> By: mft http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30068 mft Sun, 21 Dec 2008 11:57:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30068 Markets wil come alive again when many people begin to believe that assets are cheap and not going to fall much more. We all know that. But there is something else we know - we do know that we don't know what will happen to earnings next year. If they really fall by half, as some warn, stocks will appear far too expensive at current levels. But whether this will happen is something we really cannot predict at this point. So I suppose everyone is just waiting to see what happens, and that's why there is comparatively little movement at the moment. Markets wil come alive again when many people begin to believe that assets are cheap and not going to fall much more. We all know that. But there is something else we know – we do know that we don’t know what will happen to earnings next year. If they really fall by half, as some warn, stocks will appear far too expensive at current levels. But whether this will happen is something we really cannot predict at this point. So I suppose everyone is just waiting to see what happens, and that’s why there is comparatively little movement at the moment.

]]> By: Glen http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30056 Glen Sun, 21 Dec 2008 08:30:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30056 I'm wondering if the markets are suffering battle fatigue? So smashed are they that no amount of bad news will make a scrap of difference to the way they move. I do find it interesting that there are many calls for the end of this fiasco by Q4 09. Given that this bubble has been in the making for many years, 12 months is just not going to be enough time for the unwinding and consolidation of the debt bubble and the emergence of a confident consumer, banking and business sectors. No amount of Fed pump priming is going to restore confidence as I might trust you but do I trust the person who you are going to lend my money to? Asset price stability followed by a restoration in confidence are the keys to getting the show moving again and neither can be bought. I’m wondering if the markets are suffering battle fatigue? So smashed are they that no amount of bad news will make a scrap of difference to the way they move. I do find it interesting that there are many calls for the end of this fiasco by Q4 09. Given that this bubble has been in the making for many years, 12 months is just not going to be enough time for the unwinding and consolidation of the debt bubble and the emergence of a confident consumer, banking and business sectors. No amount of Fed pump priming is going to restore confidence as I might trust you but do I trust the person who you are going to lend my money to? Asset price stability followed by a restoration in confidence are the keys to getting the show moving again and neither can be bought.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/12/blog-post.html#comment-30053 Anonymous Sun, 21 Dec 2008 08:10:00 +0000 http://www.nakedcapitalism.com/2008/12/analysts-expect-reports-on-spending-home-sales-to-show-decine-in-november/#comment-30053 I think the options market is holding up the equities markets. Look at the closings on options expiration days. Could the market even fall much more? There has to be an awful lot of money on the other side of that trade, and they are not long equities. <br/><br/>I can see the former brokerage houses selling crazy out of the money options, and then looking at the cost of making them good. The amount and speed of the fall are exactly what options were designed to abate. The scary part is that maybe they did. Pay out on an option, or just buy the futures to drive the price up. I expect all of these are at play. I think the options market is holding up the equities markets. Look at the closings on options expiration days. Could the market even fall much more? There has to be an awful lot of money on the other side of that trade, and they are not long equities.

I can see the former brokerage houses selling crazy out of the money options, and then looking at the cost of making them good. The amount and speed of the fall are exactly what options were designed to abate. The scary part is that maybe they did. Pay out on an option, or just buy the futures to drive the price up. I expect all of these are at play.

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