Too much Pessimism and too many shorts.

[harkm]

Quote from HolyGrail:

I talk with many of my customers on a daily basis. There is not even one of them that is considering laying off anyone. In fact, it is just the opposite. They want to hire more people but cannot find them. That sure doesn't sound like a recession to me.

Service businesses haven't really suffered yet. That is why we are at full employment. Who knows if it will spread but if you look at the macro picture it doesn't look good. All the easy credit is dissappearing and the growth from the last 20 years was almost entirely due to easy money.

 

[HolyGrail]

Quote from harkm:

Service businesses haven't really suffered yet. That is why we are at full employment. Who knows if it will spread but if you look at the macro picture it doesn't look good. All the easy credit is dissappearing and the growth from the last 20 years was almost entirely due to easy money.

I'm not in the service business. I sell raw materials to manufacturers and metal fabricators. During recessionary periods we are normally the first to feel the pain. So far, there is no pain whatsoever. I do agree that overall things are not looking good, but hell, business is great.

 

[nugundam]

Quote from lp3yc:

That's a good one.

Markets can stay oversold way longer than you can stay solvent

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Yeah, have to say learned that the hard way on the short side though (more specifically EBAY post bubble)

 

[harkm]

Quote from HolyGrail:

I'm not in the service business. I sell raw materials to manufacturers and metal fabricators. During recessionary periods we are normally the first to feel the pain. So far, there is no pain whatsoever. I do agree that overall things are not looking good, but hell, business is great.

Interesting. Either we at the very early stages or this whole recession thing is bs.

 

[zdreg]

Quote from MKTrader:

Looks much more like a long-term sideways market, a la 1966-1982. The 2000-2002 bear was a lot like the 73-74' bear inside that market. Personally, I think this sideways market (now 10 years, from '99-'08) will break to the upside faster than the '66-'82 one, but who knows. If earnings grow (even slowly) over the next few years and stocks trade sideways, valuations should start getting really nice. In '82, average P/E was something like 8....a sure signal to load up and hold on to stocks.

If you look at long-term history of the stock market, it's almost completely filled with sideways and bull markets. Bear markets are typically 1-3 years inside sideways markets. True long-term bear markets are very rare. Last one was during the Great Depression.

(OK, let all the permabears now try to convince everyone that we're in Round 2 of the Great Depression...)

Oh, and Japan is/was a totally different animal--definitely an apples and oranges comparison.

"Oh, and Japan is/was a totally different animal--definitely an apples and oranges comparison."

absolutely correct. japan unlike the United States doesn't have a native born underclass consisting of ten millions of people who don't speak their native language properly.

 

[zdreg]

Quote from harkm:

Interesting. Either we at the very early stages or this whole recession thing is bs.

or maybe we are at the early stages of a depression as derivatives unwind.

 

[Champion]

To be honest, few get affected by a recession.Federal agents don't bust into town and publicly torture a few citizens just to make sure everyone gets the message so that all and sundry do know, without doubt, there really is a recession. If you look at the post-WW2 recessions they don't last that long and the bear markets that go with them tend to be relatively brief. So long as price is jigging around a bit, as it will anyhow, markets will continue to offer good profits to traders and the trading fraternity.

 

[ammo]

good post by staffpro on first page,thnx for doing all that homework,there is usually a panic to point out a bottom,we had 1/23 and it bounced hard, i think we go to 1250, thats aug 06 low,the start of a 3 step rally,the 87 crash was a 3 step from 1/86 -10/ 87, it went to bottom of 1st step and rallied , not saying we will be ok after that but i do expect a bounce,1380 t0 1250 is 130 points ,so half,65, 50% retrace brings us back to 1315,38% just under 1300,then sell back down to 1160,and that will be the bottom on a 20 year chart that is support,i agree with u day on the oversold indicators, i'm looking for a bounce soon,maybe an early rate cut of .25 and then no more cuts for a while, the bonds sell off and the money moves into cheap equities, guessing is free, see what the mrkt thinks, it always has the last say

 

[MKTrader]

Well, Japan is getting an influx of foreigners as well (from Brazil, Korea, etc.), but that's not what I'm talking about. Our banks are far from perfect, but it's nothing like the old-boy network in Japan that loaned to the hilt to their friends even when things were accelerating to the downside.

There are a lot of things to respect about Japan (productivity, savings rate, etc.). These things have kept their country relatively stable through all their other financial problems. But their banking problems were on a completely different level.

For the U.S., once this credit crunch started, many banks started tightening conditions for even credit worthy borrowers.

Quote from zdreg:

"Oh, and Japan is/was a totally different animal--definitely an apples and oranges comparison."

absolutely correct. japan unlike the United States doesn't have a native born underclass consisting of ten millions of people who don't speak their native language properly.

 

[HedgefundTrader2]

Quote from zdreg:

or maybe we are at the early stages of a depression as derivatives unwind.

You brain is at the early stages of Alzheimer's and its starting to crack open.