I Had To Do It: Poll - Who Thinks A Crash Is Near (1-4 months)?

[JSL_Capital]

Quote from bpl1000:

To share my useless CFA information- and possibly be corrected on my misconception (please correct me before Dec): The number of ETF shares are not fixed, i.e. they are created/liquidated according to demand- so my impression is that the "hard to borrow" issue would not be as applicable as individual stocks.

Correct. open-end (i.e. index) ETFs do not have a fixed number of shares outstanding - the number therefore fluctuates on a daily basis. Market Makers can control the float size by buying or selling the underlying basket of shares (and giving it to the fund admin at the end of the day). The process is usually done in lots of a few thousand to tens of thousands of shares and its size depends on the size of the ETF. If an ETF is hard to borrow (which seems to be the case with IB) it's more likely the broker side inventory issue than anything else, though being mostly retail that we IB customers are, we are supposed to represent the dumb money .

CFA Pending

 

[gnome]

For the market to crash, there would have to be a strong psychological shift. To *anticipate* such an event, you'd have to believe you could predict when people would change their minds.... totally ridiculous!!

Until the market plunges through critical support, "crash talk" is about as stoopid as it gets in the markets.

 

[tradingonsoju]

I'm a little confused at the past couple of days. We are pushing at highs on the SP futs yet there is no volume to the up or downside? Granted today we broke into a lower trading range (stressing RANGE). But it still felt un-natural in it's movement.

Maverick mentioned the world being short and since the majority is inherently wrong , you'd figure someone of significance would either jump on board and help sink the ship or squeeze them out? Have the bond markets stunned and confused the equities? What gives? This mkt. has been very muted over the last couple of days.

 

[bjg]

Quote from gnome:

For the market to crash, there would have to be a strong psychological shift. To *anticipate* such an event, you'd have to believe you could predict when people would change their minds.... totally ridiculous!!

Heard of Elliott Wave? Of course you can't predict anything, but it is based on crowd psychology.

 

[gnome]

Quote from bjg:

Heard of Elliott Wave? Of course you can't predict anything, but it is based on crowd psychology.

Maybe not. When Elliott did his work, markets were driven by individuals trading their own small money who wanted to make a profit but were also afraid of losing. Now, the markets are driven by a small number of money managers who are willing to take bigger risks with "other people's money" and who are primarily afraid of not keeping up with their peers so they might lose their jobs. Also, there is heavy intervention in the stock market by central banks and governments now.

I think it highly likely that Elliot Wave, if it was EVER valid, no longer is.

 

[edgetrading]

I'm short ESX.

 

[bjg]

Quote from gnome:

Maybe not. When Elliott did his work, markets were driven by individuals trading their own small money who wanted to make a profit but were also afraid of losing. Now, the markets are driven by a small number of money managers who are willing to take bigger risks with "other people's money" and who are primarily afraid of not keeping up with their peers so they might lose their jobs. Also, there is heavy intervention in the stock market by central banks and governments now.

I think it highly likely that Elliot Wave, if it was EVER valid, no longer is.

Prechter wrote a book on it in the 70s, so he still thought it was valid then.

I think it's valid to an extent; time will tell if it really is fractal with no limits.

 

[efficiency]

Quote from ByLoSellHi:

It's not scientific, but I'm actually pretty curious about the level of bullishness/bearishness amongst traders.

Why would it MATTER whether traders are bullish OR bearish? Guppies in the pond.

On a typical day, 70% of the volume on the NYSE is program trading. Approached 93% the last week of June. Factor in contingent dervivatives.

Secondly, a stock is "worth" what the specialist is willing to bid for it. This is all about the merchandising of paper. Wall Street works 24/7 to SELL paper.

Any crash would be the specialists in concert, with some pithy news item as an alibi. 1987, it was Secretary of State Baker's media remarks about dollar weakness. 1989, is was the UAL takover. 2001, the WTC. The only "V" bottom I've ever seen hold.

NASDAQ? LOL, contrary to the big bad ass .....eh.....traders, "it's" just along for the ride.

Two thirds of those running money have never seen a crash. They only think they've seen a recession. And fiduciary responsiblity is a myth.

I imagine someday there will be a crash to in effect confiscate baby boomers retirement funds. However, nobody is going to ring a bell annoucing a crash ahead of time.

How do you define a crash? Percentage? Duration? One-sided advance/decline ratio? Volume?

A prolonged bear market is far more scathing. Magnifude and duration. Give me 1987 over a Chinese water torture 1974 anyday. Oh that's right, it's before your time. All the more reason to be susceptible to unpleasant surprises.

My 100th post. Gee, I've lost my virginity.

 

[Maverick74]

Quote from Maverick74:

Let me help you guys out. As of today, the DIA is hard to borrow as is the QQQQ's. There is only 4.3 million shares left to borrow of the SPY. Let me translate this for everyone. The entire world is short. I'll let you guys fill in the blank what it means when the entire crowd is on the same side of the trade. Good luck shorts. What is obvious, is obviously wrong.

I hate to toot my own horn here, but who called this?

Where is the crash?!?!?!?!!?!?!??!?!?!

 

[DaBrain]

Yes definitely, the end is at hand, the total meltdown of our markets is near since the DOW has finally, after 6 years, broken out.

Oh yes, everything is soooo overvalued.

The BRIC nations are expanding and US unemployment is under 5%. A major US city has all been wiped out by a natural catastrophe. The country suffered its most horrid attack since WWII in the form of 911. Corporate profits are growing and balance sheets are "cleaner" and laden with more cash than ever before.

Let me tell ya, if 911, the Iraq war, Katrina, almost $80/barrel oil and a campaign of Fed tightening didn't deep six this market worse than they did, none of the numb-skulled "traders" on this site are going to be able to make an accurate bear call.

The market will be near its final stages when the retail investors flock back to the markets. The arrival Average Joe back to the market will be the trumpeting warning to start raising cash for the correction.

LOL!