Any chartists, you bailing while you can.

[bunkynuts]

Quote:

Originally Posted by flyingaway Did you know "collateralized debt obligations or credit default swap’s were bad things" in 2008? People only know the problems after the market crashes.

Why do you think Collateralized Debt Obligations and Credit default Swaps are bad things? They were around way before 2008 and are still being used today.

[HI Bill]

Quote:

Originally Posted by bunkynuts Why do you think Collateralized Debt Obligations and Credit default Swaps are bad things? They were around way before 2008 and are still being used today.

Because they largely contributed to the 2008-2009 real estate market crash. They are bad things because they are insurance based on statistics, and outliers can happen. I'm sure some make lots of money off of them, but they allow investors (banks) to make risky loans that they would otherwise never undertake. JMHO.

[haha]

Quote:

Originally Posted by HNL Bill Because they largely contributed to the 2008-2009 real estate market crash. They are bad things because they are insurance based on statistics, and outliers can happen. I'm sure some make lots of money off of them, but they allow investors (banks) to make risky loans that they would otherwise never undertake. JMHO.

Everything no matter how questionable it may be nevertheless has an upside for somebody. Otherwise it would not exist. The more credit, the more business gets done.

IMO, a lot of the problems with securitized debt would be avoided or greatly alleviated if the originator of the loan had to retain a portion of it that would be meaningful to that originator.

Ha

[HI Bill]

Quote:

Originally Posted by haha Everything no matter how questionable it may be nevertheless has an upside for somebody. Otherwise it would not exist. The more credit, the more business gets done. IMO, a lot of the problems with securitized debt would be avoided or greatly alleviated if the originator of the loan had to retain a portion of it that would be meaningful to that originator. Ha

I agree completely with your second statement. Regarding the first: just because something exists, and has an upside for somebody, doesn't mean it should exist, as it may cause unreasonable losses/damage or risk or exposure to others through no fault of their own. In my world, there would be no short selling. At all. Just one example of something that exists, with sometimes positive market influences, but often times, more destructive to the equity that's being shorted, without real cause. JMHO. Just look at the short seller's effects on Tesla. Most of their 'research' and 'fears' were unfounded, aimed squarely at causing the price of the stock to drop, benefiting only those who contributed nothing to the creation of anything, other than their own profits.

"The more credit, the more business gets done." THIS is what caused the 2008-2009 real estate crash. Credit with no/loose income verification, and loosening of the lending standards. Did this help more business get done? Absolutely! Was it good for the banks, lenders, and bank equitey holders when the foreclosure started? Absolutely not.

[dtbach]

Quote:

Originally Posted by RetireSoon I'm of the opinion that the market will continue upwards into and through 2019 - unless the fall elections lead to a divided Congress, which the market could see as bad as that'd impact what can be accomplished in terms of continued improvements in less regulations, lower taxes, etc - all which will impact corporate profits. .

I think a divided congress would be good for the markets. Somebody has to push back against constant threats of more tariffs. I think that is spooking the markets the most.

[haha]

Quote:

Originally Posted by HNL Bill I agree completely with your second statement. Regarding the first: just because something exists, and has an upside for somebody, doesn't mean it should exist, as it may cause unreasonable losses/damage or risk or exposure to others through no fault of their own. In my world, there would be no short selling. At all. Just one example of something that exists, with sometimes positive market influences, but often times, more destructive to the equity that's being shorted, without real cause. JMHO. Just look at the short seller's effects on Tesla. Most of their 'research' and 'fears' were unfounded, aimed squarely at causing the price of the stock to drop, benefiting only those who contributed nothing to the creation of anything, other than their own profits. "The more credit, the more business gets done." THIS is what caused the 2008-2009 real estate crash. Credit with no/loose income verification, and loosening of the lending standards. Did this help more business get done? Absolutely! Was it good for the banks, lenders, and bank equitey holders when the foreclosure started? Absolutely not.

I appreciate your reply. All I was trying to show is that most things seem to exist in a dynamic and given what humans are, often unstable tension. It is not credit per se, but foolishly extended credit that caused the big losses. But in any imaginable world, where there is credit being extended, sooner or later credit will being foolishly extended to many of the wrong borrowers. Some of this is due to glaring faults in the system. Yet many of these faults help some people or groups, and those groups have a powerful motivation to see to it that these systemic flaws do not get remedied, or if they do, the remedies are cancelled or blocked. C’est la vie!

Ha

[copyright1997reloaded]

Quote:

Originally Posted by dtbach I think a divided congress would be good for the markets. Somebody has to push back against constant threats of more tariffs. I think that is spooking the markets the most.

While congress has the constitutional power over tariffs:

Quote:

[Article 1, Section 8]:The Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States; but all duties, imposts and excises shall be uniform throughout the United States;

congress ceded a lot of authority to the executive branch via the Trading with the Enemy Act of 1917, the International Economic Powers Act of 1977, and the trade act of 1974, and other legislation giving the executive branch power to instate and keep Tariffs. As a side note, import tariffs were the major revenue source for the federal government from our founding until the income tax was instantiated.

[rtroxel]

The market, in 2019, will go up, go down, or maybe stay the same. And that is what I will 'act' upon (if taking no action can be considered an act).

Doesn't the market always do that?

Roy

[Dtail]

Quote:

Originally Posted by haha Everything no matter how questionable it may be nevertheless has an upside for somebody. Otherwise it would not exist. The more credit, the more business gets done. IMO, a lot of the problems with securitized debt would be avoided or greatly alleviated if the originator of the loan had to retain a portion of it that would be meaningful to that originator. Ha

Agree with the second statement too.
CDO's and CDS's are great for some traders in the market, not so much for everyone else.