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Old 12-05-2008, 02:48 PM   #21
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In case you had any doubt in the accuracy of my new theory that down is the new up, just look at today's returns. +500k jobs lost last month but we're up 250 points. That's change you can believe in.
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Old 12-05-2008, 03:03 PM   #22
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In case you had any doubt in the accuracy of my new theory that down is the new up, just look at today's returns. +500k jobs lost last month but we're up 250 points. That's change you can believe in.

So a 9% unemployment rate is another 2,000 points on the DOW, well I'll do my part and remain unemployed.
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Old 12-05-2008, 03:04 PM   #23
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The sun will come out tomorrroooowww...
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Old 12-05-2008, 03:11 PM   #24
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I wouldn't mind a session at Sarah's Smash Shack in San Diego, where customers pay for some time in a "break room" where they can smash dishes and so on to relieve stress:

Sarah's Smash Shack San Diego, CA

Then again, after a lifetime of being cheap---I mean frugal----and after all the money I've lost, I probably wouldn't pay $35 to smash 10 dishes!

Well, you could probably buy the dishes for a dollar each or maybe even less at any thrift store. Now all you need is somewhere to throw them!
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Old 12-05-2008, 03:31 PM   #25
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Well, you could probably buy the dishes for a dollar each or maybe even less at any thrift store. Now all you need is somewhere to throw them!
My cheap version of this is to go down to the local recycling center and chuck glass bottles into the bins really hard. 'Course, you gotta make sure you don't miss!
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Old 12-05-2008, 05:15 PM   #26
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My cheap version of this is to go down to the local recycling center and chuck glass bottles into the bins really hard. 'Course, you gotta make sure you don't miss!
LOL! Obviously you have me completely outclassed in the frugality department.
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Old 12-05-2008, 05:28 PM   #27
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In case you had any doubt in the accuracy of my new theory that down is the new up, just look at today's returns. +500k jobs lost last month but we're up 250 points. That's change you can believe in.
Yes, I hope more people will appreciate this movement.

Earlier this week, the NBER has declared that we entered into a recession in Dec 07. It's been a year. Stock market probably is already at the bottom, although unemployment will continue to rise well into next year. In all previous recessions, the stock market always leaded the unemployment. I do not see why it should be different this time.
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Old 12-05-2008, 05:49 PM   #28
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Earlier this week, the NBER has declared that we entered into a recession in Dec 07. It's been a year. Stock market probably is already at the bottom, although unemployment will continue to rise well into next year. In all previous recessions, the stock market always leaded the unemployment. I do not see why it should be different this time.
Is the NBER also the governing body for economic expansions?

If so, does this mean when the recovery happens, we won't know it until a year later?

Dang!!!! I guess I'll stay invested since we're not going to know things have turned around until long after it happens. I'll be FI and not even know it...
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Old 12-05-2008, 05:54 PM   #29
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You have not been selling recently, have you?

Investing takes a strong stomach. We all think we are tough, until the bullets start whizzing above our heads.

I still got some cash, being below my usual 70% equity AA. But I will restrain myself from buying until next year. If the economy has really bottomed and truly picks up, I will look into sectors that usually lag in the recovery.

If things get worse, well, I can always share the "head banging" emoticon with Dawg.
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Old 12-05-2008, 05:57 PM   #30
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Green is such a lovely color...
Indexes, Barometer and Sector Delta
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Old 12-05-2008, 05:57 PM   #31
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I still got some cash, being below my usual 70% equity AA. But I will restrain myself from buying until next year. If the economy has really bottomed and truly picks up, I will look into sectors that usually lag in the recovery.
Same here. I know I should be rebalancing, but I'm going to wait until the start of January. For one thing, that's when I usually rebalance. For another, I smell the potential for a lot of tax-loss selling and hedgies and institutions trying to finalize the leverage off their books before years end.

For that reason I just don't feel like this month will end well, today's rally notwithstanding. Still, if we get the tax loss selling and the hedge fund selling out of the way, it could set up for one heck of a January effect as long as Q4 earnings aren't much worse than the current pathetic revisions expect.
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Old 12-05-2008, 08:33 PM   #32
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In case you had any doubt in the accuracy of my new theory that down is the new up, just look at today's returns. +500k jobs lost last month but we're up 250 points. That's change you can believe in.
It's always a good sign when stocks can rise on bad news. It means a lot of pessimism is already priced in to the market. Not only is a 500K job loss a huge number in and of it self, it was almost 200k more than "street" expectations. By any standard, this was a huge miss . . . but somehow stocks were better on the day. Although I'm afraid we're still closer to the "end of the beginning" than the beginning of the end of this crisis, I like today's stock action better than any of the much larger one day gainers we've had recently.
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Old 12-05-2008, 08:43 PM   #33
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Not only is a 500K job loss a huge number in and of it self, it was almost 200k more than "street" expectations. By any standard, this was a huge miss . . . but somehow stocks were better on the day.
But the drop of the market is also huge. Nobody expects so many stocks to get to mid single-digit P/E's either.

So, I hope the market god calls it even and cuts us some slack.
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Old 12-05-2008, 08:47 PM   #34
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I am getting the sense that the bottom is near by the level of hysteria that accompanied the jobs report:


This is almost indescribably terrible. In the past six months the U.S. has lost 1.55 million jobs, almost as many as were lost in the whole 2001 recession, which included 9/11 and the two months after. The pace of job losses is accelerating alarmingly, as this report attests, with steep drops in most sectors but the biggest deterioration in services — down 370,000 in November after 153,000 in October. Note education/health and governmentt added 59,000, so core private payrolls even worse than headline. Desperate. –Ian Shepherdson, High Frequency Economics

These are god-awful numbers. The economy is headed downhill and the brakes are not working. There are so many layoff announcements that it is hard to keep track of. Some businesses are cutting jobs in anticipation of tougher times. This is especially true for retail, manufacturing and finance, which accounts for the bulk of jobs in the country. They want to trim fats and stay lean and mean for the tough times ahead. Also, business spending will be a drag on the economy in the foreseeable future. –Sung Won Sohn, Smith School of Business and Economics

This was much worse than was expected and represents wholesale capitulation. The threat of a widespread depression is now real and present. –Peter Morici, University of Maryland
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Old 12-05-2008, 11:03 PM   #35
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It's always a good sign when stocks can rise on bad news. It means a lot of pessimism is already priced in to the market. Not only is a 500K job loss a huge number in and of it self, it was almost 200k more than "street" expectations. By any standard, this was a huge miss . . . but somehow stocks were better on the day. Although I'm afraid we're still closer to the "end of the beginning" than the beginning of the end of this crisis, I like today's stock action better than any of the much larger one day gainers we've had recently.

Probably just a bear market bounce due to an over sold market. I don't think we are in a new "bull" yet.
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Old 12-05-2008, 11:31 PM   #36
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Probably just a bear market bounce due to an over sold market. I don't think we are in a new "bull" yet.
I myself simply hope that we thread water for a while. As long as I do not set a new personal "low", which coincided with the market on Nov 20, I am OK with it. I won't be buying nor selling for a while, sitting at around 50% equity right now.
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Old 12-06-2008, 02:30 PM   #37
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Probably just a bear market bounce due to an over sold market. I don't think we are in a new "bull" yet.
Probably, but we won't know until after the fact. Unemployment is always a trailing indicators while the stock market looks ahead. While my guess is we won't see a sustained rally for some time, we could be at a market plateau, which would be a welcome change from the vertical down market we've been experiencing.
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Old 12-06-2008, 06:54 PM   #38
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I wonder why so many rely on the adage: the market bottoms when the hysteria gets manic. Who came up with that? Why do you believe it unequivicably? I know that people behave predictably and perhaps behavioral economics plays into this theory.

But there is the possibility, and not exactly remote either, that things are going to get worse next year and the market, reacting to further corporate losses, unemployment, foreclosures, state government insolvency, and more federal bailouts, may decide to anticipate even worse returns and fall further.

then there's the international component. I don't even want to speculate there.

Just throwing it out there. I think it's a problem (and a danger) to rely on old homilies to explain past markets during an unpredictable crisis like this one.
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Old 12-06-2008, 07:33 PM   #39
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I wonder why so many rely on the adage: the market bottoms when the hysteria gets manic. Who came up with that? Why do you believe it unequivicably? I know that people behave predictably and perhaps behavioral economics plays into this theory.

But there is the possibility, and not exactly remote either, that things are going to get worse next year and the market, reacting to further corporate losses, unemployment, foreclosures, state government insolvency, and more federal bailouts, may decide to anticipate even worse returns and fall further.

then there's the international component. I don't even want to speculate there.

Just throwing it out there. I think it's a problem (and a danger) to rely on old homilies to explain past markets during an unpredictable crisis like this one.
Hi Oldbabe

I think there is some truth to the adage. It's the final irrationality that creates much of the subsequent opportunity. Problem is, it's hard to tell the difference between rational pessimism and fear driven panic until after the fact. Beforehand they both look quite similar.

I find it very helpful to filter out most of the opinions and pronouncements and listen to just a few - but listen to them over long periods of time. I also look for opinions made by people that seem to share similar risk tolerance.

Michael
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Old 12-07-2008, 07:46 AM   #40
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I wonder why so many rely on the adage: the market bottoms when the hysteria gets manic. Who came up with that? Why do you believe it unequivicably? I know that people behave predictably and perhaps behavioral economics plays into this theory.

But there is the possibility, and not exactly remote either, that things are going to get worse next year and the market, reacting to further corporate losses, unemployment, foreclosures, state government insolvency, and more federal bailouts, may decide to anticipate even worse returns and fall further.

then there's the international component. I don't even want to speculate there.

Just throwing it out there. I think it's a problem (and a danger) to rely on old homilies to explain past markets during an unpredictable crisis like this one.
There is evidence to support the adage, but this time it 'could be different' as you suggest. And I don't think most of us are discounting the possibility that things could get worse before they get better.

Fortunately most of us on this forum are not kids anymore and we've seen these things play out over and over, not only with markets/investments but countless other areas. And so we've all come to realize a convincing case can (and will) be made for anything along the continuum between unbridled optimism and paralyzing pessimism. Since no one has a crystal ball, this is a debate between glass half full and glass half empty...have at it.
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