The Surf Report
- Thread starter marketsurfer
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I think its going to be sub 10k. the waves of people dumping their mutual funds have not even begun.
surf
nice to see you SG, good point. yeah, opps are fleeting fast. talk about volatility!
surf
Big Market Bounce, Euro Crushes Dollar, Oil Knocked Down
An extremely volatile session in the stock market, resulting in the DJIA being down over 200 points prior to dramatically bouncing into positive territory; then falling hard at the close, ending the session down -92.65 to 10962.54. The Nasdaq gained +2.84 to 2215.71 and the S&P 500 fell -13.39 to 1214.91. The volatility is attributed to Bernanke's negative words, a big drop in oil prices, and the SEC's short sell curb suggestions.
General Motors (GM | Quote | Chart | News | PowerRating) climbed 5.12% or $0.48 to $9.86/share on a massive cost cutting campaign, including suspending dividends.
Fannie Mae (FNM | Quote | Chart | News | PowerRating) plunged another 27.75% or $2.70 to $7.03/share after hedge fund manager, William Ackman, proposed a reorganization plan that would annihilate shareholders.
Evergreen Solar (ESLR | Quote | Chart | News | PowerRating) rocketed up 11.46% or $1.05 to $10.21/share after winning a $1.2 billion contract in Germany.
Safeco (SAF | Quote | Chart | News | PowerRating) added 5.28% or $3.25 to $64.85/share due to Liberty Mutual reaffirming its buyout plans.
Oil fell $6.56 to $138.62/barrel, the Dollar dropped hard against the Euro and the VIX broke 30 today ending the session up .21% at 28.54.
Market Snapshot
Dow
-92.65 10962.54
NASDAQ
+2.84 2215.71
S&P 500
-13.90 1239.49
http://www.tradingmarkets.com/.site/stocks/commentary/stockmarket/-77566.cfm
An extremely volatile session in the stock market, resulting in the DJIA being down over 200 points prior to dramatically bouncing into positive territory; then falling hard at the close, ending the session down -92.65 to 10962.54. The Nasdaq gained +2.84 to 2215.71 and the S&P 500 fell -13.39 to 1214.91. The volatility is attributed to Bernanke's negative words, a big drop in oil prices, and the SEC's short sell curb suggestions.
General Motors (GM | Quote | Chart | News | PowerRating) climbed 5.12% or $0.48 to $9.86/share on a massive cost cutting campaign, including suspending dividends.
Fannie Mae (FNM | Quote | Chart | News | PowerRating) plunged another 27.75% or $2.70 to $7.03/share after hedge fund manager, William Ackman, proposed a reorganization plan that would annihilate shareholders.
Evergreen Solar (ESLR | Quote | Chart | News | PowerRating) rocketed up 11.46% or $1.05 to $10.21/share after winning a $1.2 billion contract in Germany.
Safeco (SAF | Quote | Chart | News | PowerRating) added 5.28% or $3.25 to $64.85/share due to Liberty Mutual reaffirming its buyout plans.
Oil fell $6.56 to $138.62/barrel, the Dollar dropped hard against the Euro and the VIX broke 30 today ending the session up .21% at 28.54.
Market Snapshot
Dow
-92.65 10962.54
NASDAQ
+2.84 2215.71
S&P 500
-13.90 1239.49
http://www.tradingmarkets.com/.site/stocks/commentary/stockmarket/-77566.cfm
marketsurfer meets ravi batri--- enjoy!
GREENSPAN'S FRAUD
Today, I am pleased to be joined by New York Times best selling author and highly controversial economist Dr. Ravi Batra. Dr. Batra is Professor of Economics at Southern Methodist University and has recently authored, Greenspanâs Fraud. This book exposes the many myths that surround the Chairman of the Federal Reserve and provides Dr. Batraâs unique solution to the issues that plaque the US economy. As I stated earlier, Dr. Batra is highly controversial and a true outside of the box thinker. Be prepared to have your long held beliefs challenged in this interview. Letâs get started!
Dave: How are you today, Dr. Batra?
Dr. Batra: I am fine Thank you
Dave: I want to start out by talking about the history of Allen Greenspan, prior to him becoming the chairman of the Federal Reserve. How did Greenspan obtain this powerful position?
Dr. Batra: Greenspan had a great friendship with some people that were at the White House, people that were highly placed. He himself did not have great credentials in Economics, but he was a good friend with Arthur Burns, who was Fed Chairman in the 1970s. Burns wanted Greenspan to become the Chairman of Economic Advisors. He recommended his name to President Ford in1974, and as a result he was appointed to the CEA as Chairman. At that time Greenspan did not even have a PhD in Economics. He has his Masters in Economics, but not his PhD. Nor had he written any path breaking articles in Economics, which was read by his peers or sited by his peers or so on. He did not have much in the form of economical credentials when it came down to it, but he became one of the top economists of the world. Being the CEA chairman got him recognition. Also, this is a position that is normally held by prominent and star economics.
Dave: Interesting. How did he meet Arthur Burns who was instrumental to his success?
Dr. Batra: Arthur Burns was once a professor at Columbia University in the early 1950s. Greenspan attended Columbia to do his PhD, and met Burns there. He spent two years trying to finish his PhD in Columbia , but then he dropped out of school for financial reasons. He never finished his PhD there, but he did have commonality of interest with Arthur Burns. Greenspan was against Keynesian Economics, and so was Arthur Burns, so the two had common views and they became great friends. In fact, Greenspan even loaned money to Burns to buy a home in Washington DC . They were very close to each other, but that was all Greenspan had in terms of credentials. Those credentials were efficient enough for him to become the CEA chairman. Once he became the CEA chairman in 1974, he became friends with many other people at the White House which eventually helped him become the Fed Chairman in 1987.
Dave: In your book, Greenspanâs Fraud, you go into the underpinnings of Greenspanâs economic philosophy. Two names stood out to me: the first one being Jeremy Bentham, and the second one being Ayn Rand. Letâs talk a little bit about Jeremy Bentham and who he is.
Dr.Batra: Jeremy Bentham is a philosopher from the 18th century. His philosophy is that people are highly calculating in their motives and actions. They calculate the profit and loss, utility and disutility of everything they do. Based on those calculations, their actions occur. He did not pay much attention to emotions or trying to do good to others. These kinds of motives are not important in human action. What is most important is the calculating nature. Bentham had a great influence on Greenspan. I sited him extensively in the book to show that Greenspan also developed a calculating nature. It shows when he became a businessman, to becoming an economic advisor to President Reagan, and then when he became the Fed Chairman, and so on.
Dave: OK, Bentham promotes a concept called hedonic calculus, what exactly is this?
Dr.Batra: That is exactly what it is. That human beings have a calculating nature, they make sure to calculate the profit and loss from the facts of every action. It is done in a totally rational way, with no emotion involved. In Benthamâs hedonic calculus, there is no scope for love of any sort. These are all calculations that motivate people in their actions.
Dave: Moving on to Ayn Rand. Rand âs philosophy seems similar to Benthamâs. How specifically did Rand influence Greenspan?
Dr.Batra: Yes, she taught the same philosophy also. Her philosophy has commonalities to Bentham. Bentham use to say that people are selfish. Rand taught that people should be selfish to make sure social welfare is maximized resulting in a society with high living standard. Bentham said that people are by nature selfish, and Rand said that people should be selfish, so you can see they have a lot in common that is why Greenspan was much attracted to Ayn Rand as well.
Dave: I know there are some difference between the two, where Ayn Rand taught something called Ethical Egoism, and Bentham promoted Psychological Egoism. Can you explain the difference between the two?
Dr.Batra: Well with that said, Bentham is looking at human psychology. The psychology to him is that everyone is selfish and wants to follow action based fully on calculations from profit and loss. Where as Ayn Rand is saying that capitalism has a higher moral effect which is better for society, which is why everyone should be selfish. If everyone acted in his or her self interest, then we will meet our highest productivity in the economy. So Rand is talking from the ethical viewpoint in saying capitalism is moral and ethical, because acting selfishly will lead to moral good.
Dave: I know that Greenspan became part of Rand âs inner circle, is that correct?
Dr.Batra: Yes, he taught something to Ayn Rand, and Rand taught things to him. Some of the things are shocking to me. Rand at one time denounced President John F Kennedy for being a facist dictator. She compared Kennedy to Hitler and Mussolini. Some of those things were extremely shocking to me, but I am not surprised.
Dave: Wow, thatâs radical. Was there a romantic component to Greenspanâs relationship with Rand ?.......... to be continued
GREENSPAN'S FRAUD
Today, I am pleased to be joined by New York Times best selling author and highly controversial economist Dr. Ravi Batra. Dr. Batra is Professor of Economics at Southern Methodist University and has recently authored, Greenspanâs Fraud. This book exposes the many myths that surround the Chairman of the Federal Reserve and provides Dr. Batraâs unique solution to the issues that plaque the US economy. As I stated earlier, Dr. Batra is highly controversial and a true outside of the box thinker. Be prepared to have your long held beliefs challenged in this interview. Letâs get started!
Dave: How are you today, Dr. Batra?
Dr. Batra: I am fine Thank you
Dave: I want to start out by talking about the history of Allen Greenspan, prior to him becoming the chairman of the Federal Reserve. How did Greenspan obtain this powerful position?
Dr. Batra: Greenspan had a great friendship with some people that were at the White House, people that were highly placed. He himself did not have great credentials in Economics, but he was a good friend with Arthur Burns, who was Fed Chairman in the 1970s. Burns wanted Greenspan to become the Chairman of Economic Advisors. He recommended his name to President Ford in1974, and as a result he was appointed to the CEA as Chairman. At that time Greenspan did not even have a PhD in Economics. He has his Masters in Economics, but not his PhD. Nor had he written any path breaking articles in Economics, which was read by his peers or sited by his peers or so on. He did not have much in the form of economical credentials when it came down to it, but he became one of the top economists of the world. Being the CEA chairman got him recognition. Also, this is a position that is normally held by prominent and star economics.
Dave: Interesting. How did he meet Arthur Burns who was instrumental to his success?
Dr. Batra: Arthur Burns was once a professor at Columbia University in the early 1950s. Greenspan attended Columbia to do his PhD, and met Burns there. He spent two years trying to finish his PhD in Columbia , but then he dropped out of school for financial reasons. He never finished his PhD there, but he did have commonality of interest with Arthur Burns. Greenspan was against Keynesian Economics, and so was Arthur Burns, so the two had common views and they became great friends. In fact, Greenspan even loaned money to Burns to buy a home in Washington DC . They were very close to each other, but that was all Greenspan had in terms of credentials. Those credentials were efficient enough for him to become the CEA chairman. Once he became the CEA chairman in 1974, he became friends with many other people at the White House which eventually helped him become the Fed Chairman in 1987.
Dave: In your book, Greenspanâs Fraud, you go into the underpinnings of Greenspanâs economic philosophy. Two names stood out to me: the first one being Jeremy Bentham, and the second one being Ayn Rand. Letâs talk a little bit about Jeremy Bentham and who he is.
Dr.Batra: Jeremy Bentham is a philosopher from the 18th century. His philosophy is that people are highly calculating in their motives and actions. They calculate the profit and loss, utility and disutility of everything they do. Based on those calculations, their actions occur. He did not pay much attention to emotions or trying to do good to others. These kinds of motives are not important in human action. What is most important is the calculating nature. Bentham had a great influence on Greenspan. I sited him extensively in the book to show that Greenspan also developed a calculating nature. It shows when he became a businessman, to becoming an economic advisor to President Reagan, and then when he became the Fed Chairman, and so on.
Dave: OK, Bentham promotes a concept called hedonic calculus, what exactly is this?
Dr.Batra: That is exactly what it is. That human beings have a calculating nature, they make sure to calculate the profit and loss from the facts of every action. It is done in a totally rational way, with no emotion involved. In Benthamâs hedonic calculus, there is no scope for love of any sort. These are all calculations that motivate people in their actions.
Dave: Moving on to Ayn Rand. Rand âs philosophy seems similar to Benthamâs. How specifically did Rand influence Greenspan?
Dr.Batra: Yes, she taught the same philosophy also. Her philosophy has commonalities to Bentham. Bentham use to say that people are selfish. Rand taught that people should be selfish to make sure social welfare is maximized resulting in a society with high living standard. Bentham said that people are by nature selfish, and Rand said that people should be selfish, so you can see they have a lot in common that is why Greenspan was much attracted to Ayn Rand as well.
Dave: I know there are some difference between the two, where Ayn Rand taught something called Ethical Egoism, and Bentham promoted Psychological Egoism. Can you explain the difference between the two?
Dr.Batra: Well with that said, Bentham is looking at human psychology. The psychology to him is that everyone is selfish and wants to follow action based fully on calculations from profit and loss. Where as Ayn Rand is saying that capitalism has a higher moral effect which is better for society, which is why everyone should be selfish. If everyone acted in his or her self interest, then we will meet our highest productivity in the economy. So Rand is talking from the ethical viewpoint in saying capitalism is moral and ethical, because acting selfishly will lead to moral good.
Dave: I know that Greenspan became part of Rand âs inner circle, is that correct?
Dr.Batra: Yes, he taught something to Ayn Rand, and Rand taught things to him. Some of the things are shocking to me. Rand at one time denounced President John F Kennedy for being a facist dictator. She compared Kennedy to Hitler and Mussolini. Some of those things were extremely shocking to me, but I am not surprised.
Dave: Wow, thatâs radical. Was there a romantic component to Greenspanâs relationship with Rand ?.......... to be continued
Donald was Vice Chairman of Barclayâs Global Investors (formerly Wells Fargo Investment Advisors) one of the largest investment management firms in the world with over $500 billion under management. He was involved in the creation of the OEX index and was lead market maker in Chicago for OEX options at the contract's introduction.
He presently specializes in providing cutting-edge research to hedge funds and money management firms via his website, www.trendmacro.com. Donaldsâs current interest and expertise lays in the application of his knowledge of macroeconomic forecasting to market strategy. How politics and governmental intervention affect the market is one of his primary areas of focus. He is a media provocateur and publishes the popular web blog, www.poorandstupid.com. On the eve of the presidential election, I can think of no one timelier to interview. Letâs get started!
DAVE: Letâs first get into a bit of your history, your evolution as a trader.
DONALD: My interest started with an interest in gambling. Back in the 1970âs, I learned the skill of card counting and started beating the casinos. This was back in the single deck blackjack days; one could actually do this without being thrown out of the casino. Many of the card counters then were market makers on the Pacific Stock Exchange, which I joined in 1979.
DAVE: This was before option models become commonplace?
DONALD: The Black Scholes model was still relatively new and personal computers were still novelties. If you had real-time access and computer models back then, you were the one-eyed man in the land of the blind. The models were imperfect, but they were enough to give one a significant advantage.
DAVE: I know you involved in the creation of the OEX options in Chicago. One of my first trades was in the OEX options, so I find this part of your history fascinating.
DONALD: Yeah, those were the days. When I was a market maker on the Chicago Board Options Exchange, my business was based around certain aspects of the tax law. Those laws changed in 1984 and pretty much put me out of business.
DAVE: What was your involvement in the early days of the POSIT ECN?
DONALD: It was my idea. And I wrote the business plan for Investment Technology Group, as a unit within Jefferies & Company. It's now a separate public company, and POSIT now does somewhere around 10-15% of NYSE volume everyday.
DAVE: Wow, Iâll say that was a success! Tell me a little about your open mutual fund MetaMarkets.com.
DONALD: MetaMarkets.com was a web site that offered a web-based mutual fund called OpenFund. It was the first interactive mutual fund. All the trades, all the positions, everything was done in real time on the Internet. The investors could talk to the portfolio manager and traders in real time. It was meant to be a fusion between online trading and mutual funds.
DAVE: That seems like a really cool idea. Is the fund still operating? What happened?
DONALD: Well, we launched MetaMarkets.com in the late 1990âs during the dot-com craze. Like the other dot-coms, we invested heavily in advertising when getting market share was the top priority -- always assuming you could get more venture funding when you ran out of money. But after the bubble burst, the money dried up. In addition, public interest in the stock market took a dramatic hit. We went from being massively in favor to massively out of favor. It doesnât take long to get crushed when this happens.
DAVE: I know exactly what you mean. I was involved in the E*Trade Media launch. I worked on their radio programming. They spent tons of money, built a monster studio in NYC, then all of a sudden, poof, they were gone.
DONALD: Yeah, it can happen fast.
DAVE: Ok, Lets jump into how you view the financial markets. What is your primary method of analyzing the market?
DONALD: My firm, Trend Macrolytics, takes a top-down approach. We apply macroeconomic forecasting to market strategy.
DAVE: Please explain this a little deeper.
DONALD: We donât recommend individual stocks. The deepest we get into the details is stock sectors. Our primary focus is broad asset classes. The only time we even think about individual stocks is to the extent they are symbolic of the macro economy, such as, say, Microsoft. Our analysis is based on forward-looking market-based indicators.
DAVE: What do you mean by forward- looking indicators? Is there a way our audience can apply these indicators to their own trading?
DONALD: Sure, Iâll give you some examples. Right now the key to the macroeconomic picture is inflation and deflation. My partner, David Gitlitz, was the first American economist to forecast deflation, back in the late 1990s. Respectable economists never even mentioned the word then. It was thought to be impossible. But David was right. And he didn't make that great call with the typical macro indicators like the CPI, which are backwards looking by definition. They are kind of a scorecard for what has happened in the past. They are not much good for forecasting inflation or deflation in the future. So, back to your questionâwe believe that commodities (such as gold) and foreign exchange rates are critical forward looking indicators of inflationary risks. These markets give forward-looking estimates of inflation that can be extrapolated to forecast how financial markets will move in response to changes in inflation
He presently specializes in providing cutting-edge research to hedge funds and money management firms via his website, www.trendmacro.com. Donaldsâs current interest and expertise lays in the application of his knowledge of macroeconomic forecasting to market strategy. How politics and governmental intervention affect the market is one of his primary areas of focus. He is a media provocateur and publishes the popular web blog, www.poorandstupid.com. On the eve of the presidential election, I can think of no one timelier to interview. Letâs get started!
DAVE: Letâs first get into a bit of your history, your evolution as a trader.
DONALD: My interest started with an interest in gambling. Back in the 1970âs, I learned the skill of card counting and started beating the casinos. This was back in the single deck blackjack days; one could actually do this without being thrown out of the casino. Many of the card counters then were market makers on the Pacific Stock Exchange, which I joined in 1979.
DAVE: This was before option models become commonplace?
DONALD: The Black Scholes model was still relatively new and personal computers were still novelties. If you had real-time access and computer models back then, you were the one-eyed man in the land of the blind. The models were imperfect, but they were enough to give one a significant advantage.
DAVE: I know you involved in the creation of the OEX options in Chicago. One of my first trades was in the OEX options, so I find this part of your history fascinating.
DONALD: Yeah, those were the days. When I was a market maker on the Chicago Board Options Exchange, my business was based around certain aspects of the tax law. Those laws changed in 1984 and pretty much put me out of business.
DAVE: What was your involvement in the early days of the POSIT ECN?
DONALD: It was my idea. And I wrote the business plan for Investment Technology Group, as a unit within Jefferies & Company. It's now a separate public company, and POSIT now does somewhere around 10-15% of NYSE volume everyday.
DAVE: Wow, Iâll say that was a success! Tell me a little about your open mutual fund MetaMarkets.com.
DONALD: MetaMarkets.com was a web site that offered a web-based mutual fund called OpenFund. It was the first interactive mutual fund. All the trades, all the positions, everything was done in real time on the Internet. The investors could talk to the portfolio manager and traders in real time. It was meant to be a fusion between online trading and mutual funds.
DAVE: That seems like a really cool idea. Is the fund still operating? What happened?
DONALD: Well, we launched MetaMarkets.com in the late 1990âs during the dot-com craze. Like the other dot-coms, we invested heavily in advertising when getting market share was the top priority -- always assuming you could get more venture funding when you ran out of money. But after the bubble burst, the money dried up. In addition, public interest in the stock market took a dramatic hit. We went from being massively in favor to massively out of favor. It doesnât take long to get crushed when this happens.
DAVE: I know exactly what you mean. I was involved in the E*Trade Media launch. I worked on their radio programming. They spent tons of money, built a monster studio in NYC, then all of a sudden, poof, they were gone.
DONALD: Yeah, it can happen fast.
DAVE: Ok, Lets jump into how you view the financial markets. What is your primary method of analyzing the market?
DONALD: My firm, Trend Macrolytics, takes a top-down approach. We apply macroeconomic forecasting to market strategy.
DAVE: Please explain this a little deeper.
DONALD: We donât recommend individual stocks. The deepest we get into the details is stock sectors. Our primary focus is broad asset classes. The only time we even think about individual stocks is to the extent they are symbolic of the macro economy, such as, say, Microsoft. Our analysis is based on forward-looking market-based indicators.
DAVE: What do you mean by forward- looking indicators? Is there a way our audience can apply these indicators to their own trading?
DONALD: Sure, Iâll give you some examples. Right now the key to the macroeconomic picture is inflation and deflation. My partner, David Gitlitz, was the first American economist to forecast deflation, back in the late 1990s. Respectable economists never even mentioned the word then. It was thought to be impossible. But David was right. And he didn't make that great call with the typical macro indicators like the CPI, which are backwards looking by definition. They are kind of a scorecard for what has happened in the past. They are not much good for forecasting inflation or deflation in the future. So, back to your questionâwe believe that commodities (such as gold) and foreign exchange rates are critical forward looking indicators of inflationary risks. These markets give forward-looking estimates of inflation that can be extrapolated to forecast how financial markets will move in response to changes in inflation
Unprecedented volatility and historic market events have been rocking the indexes over the last several weeks. It's my opinion that that the feds actions, combined with Sovereign Wealth Funds need to deploy capital will cumulate in the next golden age of real estate and equities. A huge boom is right around the corner, nothing can stop it!
Right now, suggest holding SHORT in gold, stay FLAT in DJIA.
We will lean on the system to time proper entries into the current volatility. Despite, our extremely bullish long term view, short term shorts are not rulled out of the game plan.
stay tuned,
surf
Right now, suggest holding SHORT in gold, stay FLAT in DJIA.
We will lean on the system to time proper entries into the current volatility. Despite, our extremely bullish long term view, short term shorts are not rulled out of the game plan.
stay tuned,
surf
Ah. currently short the dollar, the underlying reason for some of the move in commodities, and a less volatile instrument to play.
But not sure that this is the absolute bottom. I missed the volatility bottom last week, BUT i am not sure that i haven't missed the valuation bottom coming up. . .
still holding my shorts in the belief that a valuation bottom may be occurring in the future.
sportsguy
But not sure that this is the absolute bottom. I missed the volatility bottom last week, BUT i am not sure that i haven't missed the valuation bottom coming up. . .
still holding my shorts in the belief that a valuation bottom may be occurring in the future.
sportsguy
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