Jump to content

stock market thread


Recommended Posts

Holy Crap. WW you are funny.15% unemplyment. 75% more drop in the DJIA. Warren Buffet is wrong. You premise also for these commercial buildings faltering is false too. There are lots of reasons that it won't be close to as bad as residential.1. REITs who carry up to 50% cash in their portfolio to ride out extended periods of vacancy2. Unemployment would have to hit the 15-20% mark for all these businesses to exit their leases.3. You did not have a huge number of sub-prime borrowers on commercial properties, plus for REITs and TICs wcich is where most commercial properties are held, you have to be a qualified investor. That means min 300K year salary and 1 Million net worth.

Link to post
Share on other sites
  • Replies 2.8k
  • Created
  • Last Reply

Top Posters In This Topic

Good point, I don't think this is the bottom at all, what is different this time is way more people own stock now and a lot are holding on to ride it out but when they lose thier jobs they will have to sell everything.Not until unemployment goes up 15% I don't think it will go that high but there has got to be more real hurt.They say buying a stock that is droping is like trying to catch a falling knife. watch out.
Maybe you should re-read the article. Warren Buffet didn't say it's a bottom either. In fact he said he doesn't really give a crap."Let me be clear on one point: I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month — or a year — from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over."
Link to post
Share on other sites
So what is your net worth? Hmmm I think I might be more apt to believe a guy that has made billions of dollars investing than a guy that is preaching that all the financial institutions will fail ... but somehow there will be peace and order and food on the shelves.
In the 600 or so years since the widespread use of paper currecny came to western civilization, there have been hundreds of events that could be best described as depressions. Very, very few of them have resulted in food riots, civil war, or a general breakdown of society or law and order. I'll give you the French Revolution and the Russian Revolution... but I think those were much more about overthrowing the royal class than truely about the temporary economic situation.
Link to post
Share on other sites
Maybe you should re-read the article. Warren Buffet didn't say it's a bottom either. In fact he said he doesn't really give a crap."Let me be clear on one point: I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month — or a year — from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over."
Maybe the 78 y/o, richest man in the world doesn't give a crap about picking the bottom. I, however, do care.And, no, I do not expect to be able to pick the exact bottom. I do expect to be able to tell when we're finally starting to realize that this is a Main Street problem not a Wall Street problem.As long as they are attacking this as a Wall Street problem, the economy will continue to crumble. Once I hear rumblings that they are beginning to think of this as a Main Street problem, then MAYBE, just MAYBE I'll start to believe it may stop getting worse and start getting better.
Link to post
Share on other sites
In the 600 or so years since the widespread use of paper currecny came to western civilization, there have been hundreds of events that could be best described as depressions. Very, very few of them have resulted in food riots, civil war, or a general breakdown of society or law and order. I'll give you the French Revolution and the Russian Revolution... but I think those were much more about overthrowing the royal class than truely about the temporary economic situation.
Okay my MAIN point is that I would trust advice given to me by Warren Buffet WAY before I heard anything that you are saying. I would like to make a bet with you up to $500 that the scenario that you painted will NOT come true by 10/17/09.ie ... Next year, when everyone has given up hope of a quick recovery of housing prices, when commercial property is collapsing at a rate that makes residential look like a kiddy-coaster, when unemployment is above 15%, when state and local governments are collapsing left and right, when pension funds are shutting down, when Ford and GM are in bankruptcy, when insurance companies are doubling rates to cover losses or just flat out dropping people, when Europe is desolving the Euro and going back to individual country currencies, when the big hedge funds are collapsing left and right, when people are looking to borrow money for heat instead of for a new car... Interested?
Link to post
Share on other sites
Okay my MAIN point is that I would trust advice given to me by Warren Buffet WAY before I heard anything that you are saying. I would like to make a bet with you up to $500 that the scenario that you painted will NOT come true by 10/17/09.ie ... Next year, when everyone has given up hope of a quick recovery of housing prices, when commercial property is collapsing at a rate that makes residential look like a kiddy-coaster, when unemployment is above 15%, when state and local governments are collapsing left and right, when pension funds are shutting down, when Ford and GM are in bankruptcy, when insurance companies are doubling rates to cover losses or just flat out dropping people, when Europe is desolving the Euro and going back to individual country currencies, when the big hedge funds are collapsing left and right, when people are looking to borrow money for heat instead of for a new car... Interested?
Don't forget to bet against the 50-75% drop in the Dow as well lol
Link to post
Share on other sites
Okay my MAIN point is that I would trust advice given to me by Warren Buffet WAY before I heard anything that you are saying.
And, is Buffet saying we're at bottom? Nope. He is saying that if you HIGHLY selectivly buy at teh bottom of dips, then can hold 5, 10, 15 years... You'll do okay.1) I don't think he gets it. How could this guy understand what it is like to have your income go up 20%, your cost of living go up 50%, and your debt load go up 180%.2) I have no desire to just do okay. I'm going to wait until I think we're at bottom... and this is not it!
I would like to make a bet with you up to $500 that the scenario that you painted will NOT come true by 10/17/09.
But, my claims of what will happen are based on the assertion that they will not stop attacking this like a Wall Street problem, and will start attacking this as a Main Street problem.Already this morning Bernanke did a horse and pony where he made it pretty clear that house prices aon't stop falling and it is time for another stimulus package. Of course, we went on to show he still ahs not come to grips with the real problem... or atleast won't publically admit the real problem. He says the stimulus needs to be focused on getting credit flowing again.Nope. There is already too much debt for the income of the typical consumer. Getting debt flowing again, while turning this into a slow motion train wreck, will not stop the train wreck.
Interested?
The bet would have to include that all the rescue efforts remain focused on bailing out Wall Street, bringing down LIBOR, and getting debt flowing again. IF we stay focused on what we've been focused on for the last 6 weeks, THEN we're going to see Main Street continue to pluge.IF we do more stimulus, then we can delay the crash. If we want to prevent the crash, then we need to shut down the Wall Street debt machine and natioanlaize a HUGE chunk (like $2 trillion to $3 trillion) of the excess consumer debt. And that nationalization of debt had BETTER not be proportionate to how stupid you were.
Link to post
Share on other sites

Home prices are starting to pick up. The home across the street from foreclosed less than 12 months ago for ~ 300k, well the house next door just sold (in less than a month) for ~360K. It is 200sqft bigger, basically the one extra bedroom, and the lot is the exact same size, plus it needed a ton of work. They have already replaced the roof and doing the flooring.

Link to post
Share on other sites
Home prices are starting to pick up. The home across the street from foreclosed less than 12 months ago for ~ 300k, well the house next door just sold (in less than a month) for ~360K. It is 200sqft bigger, basically the one extra bedroom, and the lot is the exact same size, plus it needed a ton of work. They have already replaced the roof and doing the flooring.
Well, if the conutry consisted of a single street, the entire housing market was 2 houses, and the national medain household income was over $100K a year, then perhaps you would have a point. But on a national level, we're only about halfway through the needed correction to restore affordability. We have 5 million too many houses, we have a median house price that is still above 4x median household income, and we have an economy based on everyone being able to spend 110% of their income, forever, without ever having to pay back any of the debt. We're not at the peak of foreclsoures. We're not at the bottom of the revession. The strenghtening dollar combined with the spreading global nature of the crash is likely to drive off the misguided hope that rich foreigners will buy up these houses. The 40% drop in stock prices should be doing a good job of dispelling the false hope of rich Baby Boomers that are about to retire will swoop in an buy up all this excess housing.We're just heading into the slow selling season, which is when the bulk of the big price drops happened last year. Fasten your seat belt.....
Link to post
Share on other sites

They have no clue....http://www.cnbc.com/id/27278711""There's a sense that if we don't do something about housing, we will end up throwing good money after bad," says Christopher Mayer, senior vice dean and professor of real estate at the Business School."Right... becuase we're only half-way back to normal affordability on a national level. Getting credit flowing again just puts us back to where we were a year ago.... except we've already shot the wad on interest rate decreases, getting foreigners to do cash injections into our banks, and about 2 trillion in liquidity injections/bad debt buy ups. What do we do to cover the other half of the coming residential losses? What about the coming credit card collapse? The commercial property bubble? Then there is the tiny problem of figuring out how to let people spend 110% of their income when they can no longer borrow $1 trillion a year against their houses and another $1 trillion a year in new business debt.""There's a sense that if we don't do something about housing, we will end up throwing good money after bad," says Christopher Mayer, senior vice dean and professor of real estate at the Business School."So, is a return to 2000 prices, or a tad less, considered a fall or a collapse, becuase that is where they are going. And the longer they take to get there, the more victims we will have created on the way down and the more overbuilding we will allow to occur in the meantime."A key concept of those plans—and virtually every other—is the refinancing of the original mortgage with better borrowing terms to avoid foreclosure."1) The terms are not casuing the foreclosures. The amount OWED in relation to income is what is causing the foreclsoures. Oh, sure.. there are some people that have an 8% or 10% loan that can afford their house if it were at 5%. But, 5% was available a couple years ago, and these people went with higher interest rate loans because of the lower initial rates available on the ARM, or they had $0 down. Or, they are horrid creidt risks????So, we're going to refi people that are suck credit risks, with $0 down against an overproced asset??? Is this another one of those plans that will actually make the government money?2) There are 3 types of markets.a: those that didn't have a bubble. In these markets, there are very few people that need help and they aren't looking at declines in proces anyway.b: places that had a bubble that has already popped or is in the processes of popping as we speak. What are you going to do for my co-worker that owes $500K on a house that is now worth $300K, and still falling?c: places that had a bubble that has not yet popped like New York, Washington DC, Miami, Boston, Seattle. So, we're going to refi a $500K house to a government loan, and then expect people to pay back the loan when the house drops to $300K?"We can't only help distressed homeowners," says Columbia's Mayer. "We need to help ordinary people, such as first-time buyers, those trading up. We have to generate new and normal business." Okay... So I bought for $130K. It peaked at $270K. I rolled in $50K of debt a year ago. Owe $180K on a house now worth just under $180K. Oh, I'd LOVE to sell for $270K so I could by my friends house for $300KIs my bailout different if I mega dumb and still owed only $130K, if I was kinda dumb and refied to only $180K, or if I was super genious and had taken out a 110% LTV loan to $300K at the peak 2 years ago?Seriously, whatever we come up with CAN NOT give the biggest rewards to those that were the most stupid and took on more house than they can afford with $0 down, while sticking it to the people that were smart and bought a house they could easily afford and had a downpayment. Whatever they come up with needs to deal with areas that had a bubble the same as areas that didn't!"Though debate has yet to be translated into legislation, there's a growing acceptance that the banking and housing crises are intricately connected and that a so-called consumer bailout is more than populist, me-too politics."GROWING ACCEPTANCE??????!?!?!??!!??!!?!?Ashats!!! The so called Wall Street problem that threatens to spill over to Main Street, if you were to listen to the blockheads in DC and New York, STARTED on Main Street when houses got so expensive that people had to use exptic mortgage products to qualify for a loan they could never repay... then shockingly, couldn't repay!This is a MAIN STREET problem that is spilling over to Wall Street, NOT a Wall Street problem threatening to spill over to Main Street. "In a recent speech, Boston Federal Reserve President Eric Rosengren emphasized the need to boost home values and market sentiment."PEOPLE DON'T HAVE THE INCOMES TO AFFORD THE HOUSES!!!!!!!! House prices started falling becuase they were unaffordable, not because of tight credit. Tight credit came later, AFTER the first wave of defaults! You can't stop house prices from falling until they have returned to affordability!""Individuals shopping for homes need to be confident that appropriate financing is available. Individuals need to be more confident in housing transactions proceeding normally," Rosengren said. "And individuals need to feel that there is potential for housing prices to rise." "Just back to making more victims as we've been doing for the last 2 years. Convince morons that prices are going to rise, so they will buy into the market, only to have their butts handed to them as prices continue to crash, BECAUSE THEY ARE STILL TOO HIGH!"Even supporters say any package will have limited impact. "Limited impact, like putting a gun to the tax payers head and pulling the trigger!The MBS holders (who were total idiots for buying bonds backed with toxic waste) get taken off the hook, and are replaced by the government that will eat trillions in losses, stimulating hyper-inflation.IT IS ABOUT WAGES!!!!!!!!House prices are too high, wages are too low, and debt is too high.... This can NOT be fixed with any $150 billion, $300 billion or $700 billion bailout. This is TRILLIONS, and we still have to deal with the systemic flaw of an economy built on debt.

Link to post
Share on other sites

WW I am dumbfounded by your notion that housing has more than 50% still to go. Where are you coming up with this?What is your base price/sqft? Homes prices will stop declining based on two factors. If you can buy within 20% more than a monthly rent payment would be, and when it is cheaper to buy a home than it is for a major build to build it. In most place we are already there or well past there.$80 a sqft and $200,000 house is cheaper to buy that rent.

Link to post
Share on other sites
Well, if the conutry consisted of a single street, the entire housing market was 2 houses, and the national medain household income was over $100K a year, then perhaps you would have a point. But on a national level, we're only about halfway through the needed correction to restore affordability. We have 5 million too many houses, we have a median house price that is still above 4x median household income, and we have an economy based on everyone being able to spend 110% of their income, forever, without ever having to pay back any of the debt. We're not at the peak of foreclsoures. We're not at the bottom of the revession. The strenghtening dollar combined with the spreading global nature of the crash is likely to drive off the misguided hope that rich foreigners will buy up these houses. The 40% drop in stock prices should be doing a good job of dispelling the false hope of rich Baby Boomers that are about to retire will swoop in an buy up all this excess housing.We're just heading into the slow selling season, which is when the bulk of the big price drops happened last year. Fasten your seat belt.....
PEOPLE DON'T HAVE THE INCOMES TO AFFORD THE HOUSES!!!!!!!! House prices started falling becuase they were unaffordable, not because of tight credit. Tight credit came later, AFTER the first wave of defaults! You can't stop house prices from falling until they have returned to affordability!.....IT IS ABOUT WAGES!!!!!!!!House prices are too high, wages are too low, and debt is too high.... This can NOT be fixed with any $150 billion, $300 billion or $700 billion bailout. This is TRILLIONS, and we still have to deal with the systemic flaw of an economy built on debt.
I think these are the strongest points you are making. We have imported cheap labor and suppressed the standard of living for the lower and lower middle classes and exacerbated the problem by exporting the industries in which those classes worked. The housing crisis is as much about wage and labor issues and the desire for cheap imported labor and exported industry as it is about anything else.ADDED: I will also say that home prices here in the midwest have been MUCH more stable than across the nation. A contributing factor to this crises has been poor real estate pricing fundamentals in leading markets -- people got pimped by the real estate, banking and construction/development businesses in some places. Up until 6 months ago, there were STILL real estate people saying the value of real estate can never decrease. There were lenders writing paper and saying it. There were builders over-extending themselves and saying it. The biggest home builder in Des Moines imploded this spring, in a market where values were and still are remarkably stable. Just goes to show you can't blow up a balloon forever.
Link to post
Share on other sites

I just went to the restroom and there was a homes magazine from Central Ca in the crapper. Single family 3-4 bedroom homes are selling for between 75K to 150K. There is no way these can come down anymore. You couldn't build a garage for 75K. The payment on that house (100% financed 30 year fixed) is less than $600 a month with taxes and insurance. It rents for 800-1000 minimum. It is past the inflection point.

Link to post
Share on other sites
I just went to the restroom and there was a homes magazine from Central Ca in the crapper. Single family 3-4 bedroom homes are selling for between 75K to 150K. There is no way these can come down anymore. You couldn't build a garage for 75K. The payment on that house (100% financed 30 year fixed) is less than $600 a month with taxes and insurance. It rents for 800-1000 minimum. It is past the inflection point.
could this not be an example of building costs that rose with the housing markets as opposed to the affordability of houses?
Link to post
Share on other sites
could this not be an example of building costs that rose with the housing markets as opposed to the affordability of houses?
To a certain extent, but not overwhelmingly. We have inflation, wood, steel, concrete, copper, all of this costs way more today than it did 5-10 years ago, plus labor has risen. Some of the guys building homes are making 35-50 dollars an hour. $200 a square foot it the average it cost to build a house, without any real upgraded materials. This is standard carpet, linoleum, basic cabinetry. Nothing fancy. It is $300 a sqft if you have marble, crown molding, fancy kitchens and bathrooms.Builders (we are talking large corporate builders who get huge discounts) build homes between $80 - $120 a square foot.In CA we have things other parts of the country don't. We by far have the highest saftey and quality control regulations. That means our basic homes are built safer and stronger than the majority of the country. That also means more materials, more labor, more inspections (which the builder pays for) and more permits.Unless we see a huge depreciation in raw materials and labor costs, then it will be cheaper to buy a home, than build one for the time being.
Link to post
Share on other sites
I just went to the restroom and there was a homes magazine from Central Ca in the crapper. Single family 3-4 bedroom homes are selling for between 75K to 150K. There is no way these can come down anymore. You couldn't build a garage for 75K. The payment on that house (100% financed 30 year fixed) is less than $600 a month with taxes and insurance. It rents for 800-1000 minimum. It is past the inflection point.
where exactly in Central CA is this? I may just buy a house there and rent it!
Link to post
Share on other sites

"I just went to the restroom and there was a homes magazine from Central Ca in the crapper."You seem to be basing your opinion that we are near bottom nationally, by looking at prices in the few hardest hit areas of the country.Look at the Case-Shiller home price index. Detroit went from 100 in 2000, to 127 in 2005, and is now at 93. Using that ONE market, you'd say we're already 10%-20% over corrected to the downside and due for a rebound.BUT, you can't use the one WORST market, or even a market in Florida that you admit is one of the hardest hit areas fo the country. You have to look at the COMPOSITE roll-up of all data.You have to take New York (2000: 108, 2006: 235, now: 192. Still needs a 40% decline), DC (2000: 110, 2006: 251, Now: 195, 40% fall needed), Seattle (2000: 110, 2006: 226, now: 178 30% decline needed), etc.The 10 city composite (2000: 100, 2006: 226, Now: 178) and 20 city composite (2000: 108, 2006: 206, now: 166) tell the tale.You can't use the lest popped market any more than the most popped market. On a national level, we're about half-way through the correction. Then comes the overcorrection to the downside due to the recessionary/hyper-stagflation economy that is coming.

Link to post
Share on other sites
Unless we see a huge depreciation in raw materials and labor costs, then it will be cheaper to buy a home, than build one for the time being.
Which is eaxctly what we need!Look. 100 million households and population growing at about 1% a year = 1 million new households each year. But, for the 20 years from '80-'00 we were building 1.3-1.4 million new housing units. Sure, some are teardowns and destroyed... BUT, total housing units was still rising at about 1.2 million new houses a year. Turns out, thouse extra 5-6 million housing units are occupied by illegals....Then comes the housing boom and we build 13 million houses in 7 years. OOOOPSSS.... 6 million too many houses. Except, not the illegals can't get work, so million of them are leaving. Millions more excess houses.There are a good 7-8 million too many houses. If we drop to HALF normal construction rate, which is a 75% reduction from the peak construction rate of 2-3 years ago, we'd be building only .5-.6 million houses a year. At that rate, it will only take about 12 YEARS to work off the excess inventory.I think we're going to go much lower than 50% normal... maybe 25% normal. That would be a drop from 2.2 million houses a year to only .3 million houses a year. 85-90% of people in construction 2 years ago, won't be in cnstruction for the next 5 years or so. And, that doesn't take into account the probability that illegals will keep leaving, voluntarily or otherwise. And it assumes we won't see massive household deformation as elderly and young adults nove in with children/parents as has happened in past recessions/depressions.If you work in construction, you BETTER find some other industry to work in!
Link to post
Share on other sites
I think these are the strongest points you are making.
Here is what I think is my strongest argument:Since 1993 (last 15 years)Median household up 20%.CPI up 50%.Per household debt up 180%.Excluding the financial secotr (which would be double counting debt), business debt up 266%.Wages have not kept up with inflation, but we were able to maintain our standard of living based on debt. Now, not only do we not have the income needed to maintain our standard of living, but we are also being crushed under a massive debt load that we can not afford.20% of the economy is debt generation. That will continue to crash because there is already too much debt. That is a minimum 10% decline in GDP, sufficient to call this a depression. There will be a minimum 10% drop in consumer spending as consumers are forced to live withn their means. Thatis another 7% drop in GDP. Initial effects of these is a 17-20% drop in GDP. As they echo through the economy, I think will break 30% decline in inflation adjusted GDP. I fully expect 15% (REAL) unemployment within 2 years.... and by real, I mean including all the independant contractors that havenlt gotten a check in many. many months.My FIL sells big trucks. He is straight comission. Not a single sale in a year. In the first quarter he got a few residual checks from delayed payments from sales he'd made last year. Last year he made $135K. This year he has made $35K, all of that in the first quarter.... But he isn't unemployed according to the government.MIL is retired. Took an early retirement/pension buyout 5 years ago. Was letting the principal rise at 1% above the rate of inflation while draining the gains in excess of inflation off as capital gains to take advantage of Bush's low rates. Of course, now that is off a good 30%.They owe $325K on a house that was worth $250K 7 years ago, and $600K 2 years ago... but is now only worth $425K, tops. From a great income + a suplimental income to a suck income and a mega hole in their retirement plans.... Meanwhile, their other daughter (my wife's sister) has already walked from one house, and is now $100K upsidedown on a second and thinking of walking from that one too.
Link to post
Share on other sites
http://www.cnbc.com/id/27316653"At the root it's 'the' problem," said Zandi. "If you're going to put your finger on the one thing that's gotten us into this fiasco, it's the fact that millions of homeowners are under water on their homes." WRONG! WRONG! WRONG!What got us into this fiasco was a mega credit bubble that drive demand for MBS, that lowered lending standards, ignighting a speculative bubble in real estate that was fueled by massive fraud, that caused house prices to become UNAFFORDABLE, but loans were being made anyway, and the toxic loans were packed into securites and sold off at huge profits to Wall Street....The rapid increase in home prices also gave people access to huge amounts of cheap debt whcih allowed them to maintain their standard of living despite wages that were not keeping up with inflation as many of the best jobs were off-shored or illegal labor was ignored and undercut domestic wages.House prices HAD to/HAVE to fall back to normal affordability based on wages. As they do, were are GUARANTEED to have TRILLIONS of dollars of upside mortgages. A large % of the extreme upside-down people will walk, even if they personally can afford the loan.Come on people. This should be no surprise. I layed this all out over a year ago, and things are progressing exactly as I said they would.It is about the WAGES! We can't afford houses at these prices, we can't afford our standard of living at these prices, and we can't afford our debt load."Already, U.S. consumer spending is slumping as homeowners find they can no longer take equity out of their homes to fund their lifestyles."That's right, and that SAME slump would be happening EVEN IF prices had only gone flat. People are living on the equity, and if prices stop going up, they have to stop living on the equity, and that is $1 trillion a year cut out of consumer spending.This negative equity problem is ONLY going to get worse as more and more markets "pop". On a national level, we're only half-way through the price corrections.
Link to post
Share on other sites
WW,which stocks do you think will be hit hardest first?
That is 100% dependant on what the government does. If they continue to just dump money at Wall Street, then I expect non-doscout retailers to be decimated this holiday shopping season. Owners of retail space will follow. A big stimulus, like the last $130 billion, $300-600 per person handouts of the spring/summer, MAY soften the blow of Christmas. But, to really save Christmas, I think it would need to be double that. Of course, that would jsut get us one more quarter and not actually do anythign to prevent what is coming.Commercial developers are going to take a beating any way you slice it. I think the home builders have further to fall. REITs will get pounded more.Yes, the auto industry is toast. I don't see how the big 3 don't go through restructuting bankruptcies, wiping out all shareholder value.... but, there isn't much there anyway.If Obama wins, the defense contractors are likely to see big cuts.I think the mining and energy stocks still have MUCH, MUCH further to fall in the face of global depression.
Link to post
Share on other sites
So, we rallied 700 points off the bottom after US and European leaders agree to meet over the weekend to "overhaul the global financial system"..... What the he ll does that mean? So, we got a 700 point rally today and maybe get a 200 pt up day tomorrow buying on the rumor, and a 700 point drop again on Monday as people sell on the news... then mid-next week we'll be right here threatening to break through the lows again, and they'll have to make some new announcement to get a 1-2 day pop that fades again. It is like Groundhog Day; same thing over and over and over and over....
Anyone want to point out how wrong I was? I thought Friday would be up while Monday would be down. I had those two backwards. On Friday it looked like not much would happen, but over the weekend, both Korea and Netherlands (or was it Belgiam) each thew $10+ billion at the problems.Then there was yesterday when the Treasury threw another $500 billion at money markets to allow them to meet redemption requests without liquidating assets and getting price discovery. Oh no.... we can't allow price discovery!Even talk of another stimulus can't get any money to do anything but flow out of markets.
Link to post
Share on other sites
WW,which stocks do you think will be hit hardest first? do you think i'm wrong to assume that we'll see a total clean-up of the banking industry?what do you think comes next? automotive industry?
I do.We make new rules, people find new ways to break them. You ban CDSs, they create something else that goes under the carpet. The problem as I see it is that people involved in such a tempting thing as money are always going to lean towards the wrong side of the line wherever you put it, regulations on banks may get harsher, will probably get harsher, but that just forces the banking system to evolve better ways of circumventing those regulations. It's easy to imagine all we have to do is to 'clean up' the system, but the system is so huge and shifty that I don't really think a lot of the expectations about change in the sector will materialise. Also to mention that not everything needs to change.
Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

Announcements


×
×
  • Create New...