Market Correction is Official

[missionfinder]

Quote:

Originally Posted by FinanceGeek it seems quite clear that the investment community favors predictability, hence gridlock is welcomed by many as a way to force compromise.

Perhaps the investment community also fears an increase in the capital gains tax rate as well?

[al_bundy]

Quote:

Originally Posted by haha Al, you may have this indicator backwards. A high mutual fund cash position is said to provide support for the market; and this has tended to be true at the extremes at least.

Bear Mountain Bull » Home

here is it. down to 3.8% cash so there isn't that much money on the sidelines to buy and drive up prices

[retire@40]

Quote:

Originally Posted by Texas Proud Just curious.... But is the correction 'official' It did not close down 10% from the highest close.... so why is it 'official'?

Based on the definition of "market correction" in my initial post, there is nothing that states it is based on the closing numbers. It is defined as a "drop of at least 10% in one of the market indexes" which is what happened today. At least one of the indexes dropped 10% from it's high.

[Dawg52]

Looks like it will be official by anyone's definition very soon.

[Bigritchie]

I actually watched it some today.

It dropped about 350, recovered, dropped to almost 350, then recovered, went in the green for about 1 minute, everyone and wall street went nuts cheering, then it closed down a few points.

[Sam]

It's official for me, regardless of the definition. Negative 1% from positive 11% in 45 days! @#$%!

[roadtoharvard]

Sorry to those that are FIRE but like Bernstein said i'm down on my hands and knees wanting to pick up some stuff at fire sale prices.

[ERD50]

Quote:

Originally Posted by roadtoharvard Sorry to those that are FIRE but like Bernstein said i'm down on my hands and knees wanting to pick up some stuff at fire sale prices.

Hope you did it yesterday, the feds just cut rates and looks like the market will open higher.

-ERD50

[Bigritchie]

I think this is option day, so the market may finish down today anyway.

[al_bundy]

Quote:

Originally Posted by ERD50 Hope you did it yesterday, the feds just cut rates and looks like the market will open higher. -ERD50

the fun starts at 2pm most days, but so far it's trending lower

maybe someone smarter than me can answer this, but what is the fed cut going to do other than lower the borrowing costs of those trying to deleverage

will anyone really buy the toxic mortgages and will anyone really lend money via ninja and liar loans again?

i remember the fed cutting rates in 2001 - 2003 and the market fell almost every single time after the rate cut

[twaddle]

The fed didn't cut the fed funds rate, they just reduced the credit window rate from 6.25% to 5.75%.

Even a cut in the fed funds rate won't have much of an impact on housing. The credit crunch is due to tighter underwriting. Housing will still tank followed by consumer spending.

[haha]

Quote:

Originally Posted by twaddle Even a cut in the fed funds rate won't have much of an impact on housing. The credit crunch is due to tighter underwriting. Housing will still tank followed by consumer spending.

This is how it looks to me also. Which should cause a recession in due course.

The Fed and treasury and administration will be doing everything they can do to keep the stock market flying in spite of reality. So far, they have been pretty good at that task.

Ha

[zedd]

Wow thats weird. This thread popped up today.
Its from '07 !

[COcheesehead]

History rhymes

[audreyh1]

Quote:

Originally Posted by zedd Wow thats weird. This thread popped up today. Its from '07 !

How did it "pop up". Your's is the first post since 2007. Did you do a search or something? Threads don't just pop up on their own.

[target2019]

Quote:

Originally Posted by audreyh1 How did it "pop up". Your's is the first post since 2007. Did you do a search or something? Threads don't just pop up on their own.

On my tablet with E-R app, there are two related threads presented at end of page. Maybe that?

[audreyh1]

Oh, OK, I’ve never paid attention to the “similar threads” box. It does show the last post date.

Thanks for explaining.

Pretty funny seeing a 2007 Market Correction is Official title now knowing that was only the beginning of a really bad bear market.

[MichaelB]

Quote:

Originally Posted by zedd Wow thats weird. This thread popped up today. Its from '07 !

Quote:

Originally Posted by audreyh1 Pretty funny seeing a 2007 Market Correction is Official title now knowing that was only the beginning of a really bad bear market.

Coincidence? Perhaps. Or, possibly, a harbinger of what’s to come, a premonition of what could be, a foreboding of what the future holds. Oh my.

[HadEnuff]

Quote:

Originally Posted by MichaelB Coincidence? Perhaps. Or, possibly, a harbinger of what’s to come, a premonition of what could be, a foreboding of what the future holds. Oh my.

nope. I think it's an augury of future events, myself.

[atmsmshr]

Quote:

Originally Posted by Running_Man Oops I corrected it was 29% was my prediction 37% was the amount it was going to drop from the top - and was derived as an average of the first year of bear market returns of severe bear markets. Naturally actual results may vary but I do feel this is the start of a severe recession. As I just heard on the radio, part of the problem is liquidity use to be cash on hand it has become available lending on hand. Housing starts have dropped as announced today to the lowest level in 10 years. Walmart the other day stated that they are noting their clientel (annual incomes less than 40K per year) have an inablity to make purchases at the end of the month. This is not just a subprime problem, I see where Countrywide has secured 11.5 Billion in bank loans to service it's mortgage business and their commercial paper was downgraded. Countrywide has financing commitments from banks of 285 billion - many of which the banks can get out of - but I would not want to be lending Countrywide money. Again I do not see these items as leading to a buying opportunity. This is not the prospective selling of September 2001 where the terrorost attacks led to fear of what would happen to the economy - this is the economy and what will it do to economic activity. Could easily get some really sharp nice rallies but over the next 12-18 months I would expect the market to continue to decline in unison with economic activity.

Running man should change his screen name to Mr. Wizard - his crystal ball was spot on before the credit markets panicked.