Which one of you guys were around for the 2008 crash?

[SoyUnGanador]

Who on today was on back then? What do you remember was going on/being said on this forum when shit was cratering back then? Are threads/posts from back then still accessible? I'd love to go back and read some of them.

Heck, I think this forum was founded in 1997? Would LOVE to see what people are saying way back then about stock that are huge today, like Amazon for example. I bet people were panning it left and right as having a ridiculously high PE and not being worthy of a purchase. I know that was definitely my thinking at the time!

Oh, the good ole' days, how I miss them.

 

[Robert Morse]

2008 was structurally different. Credit markets for Real Estate, both residential and commercial was very over-extended. Rating agencies rated all pools at AAA. Then it fell apart taking down financial institutions. IMO, markets today are re-pricing assets for higher interest rates, inflation and higher costs so lower profits.

 

[Scataphagos]

One thing I recall... Cramer was apoplectic about "Fed doesn't understand*"... CDSs run amok!

*Maybe the Fed should get 800 PhDs... 'cause "400 ain't enough?".

 

[FreeGoldRush]

2008 was structurally different. Credit markets for Real Estate, both residential and commercial was very over-extended. Rating agencies rated all pools at AAA. Then it fell apart taking down financial institutions. IMO, markets today are re-pricing assets for higher interest rates, inflation and higher costs so lower profits.

Exactly. Today it is entirely fed driven. They can back off whenever (if ever?) they feel things are about to break and simply sell you on the fact that 5%+ inflation is a good thing. This is not 2008.

 

[Laissez Faire]

This is a yawning bear so far. A slow burner.

2008 was a financial crisis.

I didn't trade actively, then, so would be interesting to hear comments from people who traded then.

2020 saw some real panic, too, with some crazy days. 2022 is pale in comparison. We haven't had even one limit down day.

 

[Specterx]

I was around, but didn't know shit.

ET had a different vibe back then as a lot of the content revolved around various TA gurus (Jack Hershey, DBPhoenix, Anekdoten) and their systems - most of that stuff today has migrated to other platforms. There were also a lot more real-deal traders posting in the PnL threads and the like, but not many making big macro calls.

I don't recall ever reading a prediction that ZIRP and QE would lead to one of the biggest and most sustained bull markets of all time, with stocks like Domino's Pizza - to say nothing of big tech - increasing 100 fold over 14 years.

If there was a widely-held forecast or zeitgeist about markets, it was that The Big One had arrived and the USA was in for 10-20 years of a grueling secular bear market, similar to Japan after 1989. Many commentators in the financial alt-press like Mike Shedlock, Mark Faber, Steve Keen, John Williams of Shadowstats, and Zerohedge spread and encouraged these views. Talk about missing the boat and leaving an ocean of cash on the table.

The irony is that the secular bear thesis was right on when it came to ex-US stock markets in dollar terms, most of which have fallen over the past fifteen years.

 

[Scataphagos]

This is a yawning bear so far. A slow burner.

2008 was a financial crisis.

I didn't trade actively, then, so would be interesting to hear comments from people who traded then.

2020 saw some real panic, too, with some crazy days. 2022 is pale in comparison. We haven't had even one limit down day.

The hallmark of bear markets in the past has not been "crashes" or "limit down" days... but rather long duration of "grind down". The time they took to play out was a big factor in the bear psycho.

 

[Robert Morse]

I was on the AMEX floor as an Option Market Maker. We have a number of banks and brokerage symbols traded. The big money was trading conversions, which I did not do. Customers were unable to get Locates on HTB symbols to short them and Mark Makers are exempt. We can be bought in from failure to deliver by the clearing firms, but we had 14 days back then. Some made 7 figures per month aggressively trading them. A conversion is long stock, long put and short call. Market makers would do the short stock side and get paid for it. A lot.

I didn't trade actively, then, so would be interesting to hear comments from people who traded then.

 

[newwurldmn]

I thought that it was illegal for anyone to short via conversion at that time. If I recall they had killed all the loopholes (except the market making one).

I was on the AMEX floor as an Option Market Maker. We have a number of banks and brokerage symbols traded. The big money was trading conversions, which I did not do. Customers were unable to get Locates on HTB symbols to short them and Mark Makers are exempt. We can be bought in from failure to deliver by the clearing firms, but we had 14 days back then. Some made 7 figures per month aggressively trading them. A conversion is long stock, long put and short call. Market makers would do the short stock side and get paid for it. A lot.

 

[Laissez Faire]

I don't recall ever reading a prediction that ZIRP and QE would lead to one of the biggest and most sustained bull markets of all time, with stocks like Domino's Pizza - to say nothing of big tech - increasing 100 fold over 14 years.

If there was a widely-held forecast or zeitgeist about markets, it was that The Big One had arrived and the USA was in for 10-20 years of a grueling secular bear market, similar to Japan after 1989. Many commentators in the financial alt-press like Mike Shedlock, Mark Faber, Steve Keen, John Williams of Shadowstats, and Zerohedge spread and encouraged these views. Talk about missing the boat and leaving an ocean of cash on the table.

The irony is that the secular bear thesis was right on when it came to ex-US stock markets in dollar terms, most of which have fallen over the past fifteen years.

I started participating here actively post financial crisis and started actively trading for the first time, then. I believe a common view was that QE would destroy the economy and there were plenty of people who kept shorting the market. Eventually, a few or most of them gave up/blew up.

Some seemed to recognize the long play very early and seemed to be always in the market on the long side making big money with little skill needed.