Horrible recession: Why are steel stocks breaking out?

[makloda]

Quote from robbie380:
please show me links that state we are in a massive global recession that is as bad as the great depression.

"Soros: It's like the Great Depression"
http://www.theaustralian.news.com.au/story/0,25197,23515757-643,00.html

"Are we facing another Great Depression?"
http://www.thisismoney.co.uk/news/s...440411&in_page_id=108&position=moretopstories

"One-in-four chance of global recession out of US crisis, says IMF"
http://www.nzherald.co.nz/section/3/story.cfm?c_id=3&objectid=10503438

 

[makloda]

Quote from HedgefundTrader2:
Get out of that doom and gloom. I traded US steel its was up 7-8 today.

Enough said. Go long or get crushed.

You're an idiot. Where do I spread doom and gloom? I pointed out that a sector is showing bullish price action in the light of what the media portrays as an impending recession of "epic proportions".

 

[dman666]

Quote from makloda:

How is a 10y annualized real growth of 1.6% a correlation? It is an economic projection implied by supply/demand in the bond market.

I am not here to argue that either cyclical equity or bond prices are "wrong". You're pissing up the wrong tree. My point is that the economic projections of these two markets are seemingly different. Something's gotta give.

This is a trading forum and in your original post you talk about "global economic implosion" and "worst recession since 1933". Then you show charts of companies in the steel industry and ask whether the markets have it wrong. Then you talk about why this doesn't fit in with your perception of what cyclical stocks should do.

Quote from makloda:

I was specifically speaking about cyclical stocks. There is not doubt financial stocks have been ripped to shreds. The bond market has and still does price in anemic real growth over the next 10 years (right now ~1.6% annualized). This doesn't fit with cyclical stocks hitting new highs like clockwork.

Is this not saying that the bond market is pricing in 1.6% annualized growth so cyclical stocks should not be hitting new highs? I guess I just can't comprehend what your saying if that's not what it says.

 

[gymratnyc]

China and India are buying our steel.

 

[dman666]

Quote from robbie380:

well if you want a really really obvious answer just look at the massive risk pricing crisis that got us to the point we are at today. would you say the "market" got it right in that case by waaay over leveraging on flawed risk formulas?

or another one right off the top of my head would be the DCR and UCR trades. both are trading far from their NAVs even though the termination trigger for that trust was hit today with oil being over $111 for 3 days in a row.

so yes the "market" gets stuff wrong pretty often. if you don't see the times when it does then maybe you should dig a little deeper.

So how did the "market" get it wrong in this massive risk crisis that got us to the point we are at today? How did the "market" over leverage based on flawed risk formulas? How did the "market" even come up with a risk formula. I thought the market was just an exchange to buy and sell.

On your DCR and UCR trades, I just looked them up and see they are some sort of Oil ETF's. I notice it say's that they will keep trading until the liquidation date. It sounds like your are trying to say there is some type of arbitrage trade you can do.

First off, if they are trading far from their NAV, that means somebody is trading them, right? If someone is trading them and moving the price, how is the price (market) wrong? If I'm missing something with this, please explain.

 

[makloda]

Quote from dman666:
Is this not saying that the bond market is pricing in 1.6% annualized growth so cyclical stocks should not be hitting new highs?

Not at all! I am just pointing out that investors in these two markets seem (!) to use very different underlying economic scenarios.

 

[HedgefundTrader2]

Quote from makloda:

"Soros: It's like the Great Depression"
http://www.theaustralian.news.com.au/story/0,25197,23515757-643,00.html

"Are we facing another Great Depression?"
http://www.thisismoney.co.uk/news/s...440411&in_page_id=108&position=moretopstories

"One-in-four chance of global recession out of US crisis, says IMF"
http://www.nzherald.co.nz/section/3/story.cfm?c_id=3&objectid=10503438

Keep beating those warning drums of doom and gloom/ There ain't no recession or nothing. Slowdown in economic conditions during winter months and massive action by The Feds and Treasury and Congress ( with whom you always fight instead of being a good Citizen and a proud Patriot.).

Before you tag those links- show me a single quarter of negative economic growth in the US since 2002 ? How about it? Come on now and prove that we are in a recession not because how you feel so terrible, but because we have a contracting GDP/

 

[HedgefundTrader2]

Quote from makloda:

Not at all! I am just pointing out that investors in these two markets seem (!) to use very different underlying economic scenarios.

Instead of focusing on price action and charts and volume, you are focused on the negative aspects of bull markets where untold millions are being made hand over fist. These steel stocks are made of steel, they do not bend or rust, demand of steel is insatiable.

 

[BullAlert]

Quote from makloda:

"Soros: It's like the Great Depression"
http://www.theaustralian.news.com.au/story/0,25197,23515757-643,00.html

"Are we facing another Great Depression?"
http://www.thisismoney.co.uk/news/s...440411&in_page_id=108&position=moretopstories

"One-in-four chance of global recession out of US crisis, says IMF"
http://www.nzherald.co.nz/section/3/story.cfm?c_id=3&objectid=10503438

Makloda,

Read the 7th paragragh in the Soros article (only 1 sentence). There lies your answer. Period.

 

[HedgefundTrader2]

Quote from BullAlert:

Makloda,

Read the 7th paragragh in the Soros article (only 1 sentence). There lies your answer. Period.

People comparing this minor hiccup in economy with Great Depression! Give me a break! Loaded with IPODS, Flat screen TVS, wearing Nike's and slurping Lattes at Starbucks these morons know nothing about hardship their elders had to go through!