# Is tonight the night the US markets really fall apart?



## mick2006 (17 August 2007)

Well guys is tonight the night that the global equity markets finally completely fall apart?

I stayed up late last night and got the feeling that the market was pretty close to the final capitulation right up until the final rally in the last 45 minutes, as a result of that last minute buying it may have covered over the cracks for another night, but with the state of markets in Asian trade and the early falls in the US futures maybe the fireworks will be on tonight.

Surprised by the lack of a major afternoon sell off in the ASX today, I don't know about you guys but there might be a few who wish they didn't buy into the market today come Monday morning.


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## Uncle Festivus (17 August 2007)

*Re: Is tonight the night the US markets really falls apart?*

Pure conjecture but I could see glimmers of hope in the small rallies today and a levelling off in "panicness"? Then again, could be the calm before the real storm hits.


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## numbercruncher (17 August 2007)

Exactly why I was a chicken little today in regards to buying! 


Too much has happened to fast and too little is known about too much for this all to be a flash in the pan I thinks!


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## mick2006 (17 August 2007)

looks like its getting worse by the minute

Nikkei Down 874 points
Hang Seng Currently Down 1140 points

Dow Futures Down 166
Nasdaq  Down 22
S&P  Down  21.5


ASX futures sitting around 100 points below closing level of the index


I know there is a long time between now and 6 am tomorrow morning but geez it certainly is looking sick.


Has anyone been watching CNBC today they are talking about a group refered to as "Defenders of the Market" which is rumoured to act on behalf of the US Government/Fed Reserve to stop a repeat of 1987, and they are believed to be the ones responsible for the late rally in the US markets last night.

Any thoughts?


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## numbercruncher (17 August 2007)

Look at the pace at which the Yen carry trade is unwinding and the massive drops in the AUD/NZD.

Amazing to watch!


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## Freddy I (17 August 2007)

Mick,

''Defenders of the Market''..........Weren't they in the Da Vinci Code


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## dubiousinfo (17 August 2007)

mick2006 said:


> Has anyone been watching CNBC today they are talking about a group refered to as "Defenders of the Market" which is rumoured to act on behalf of the US Government/Fed Reserve to stop a repeat of 1987, and they are believed to be the ones responsible for the late rally in the US markets last night.
> 
> Any thoughts?




That would be the Plunge Protection Team (PPT)

There are a few theads here on this issue, try a search.


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## mick2006 (17 August 2007)

The Aussie Dollar is now at 76.85 US cents, one thing that will become a problem again is inflation and petrol prices as the strong australian dollar was helping in both cases.

Wouldn't be surprised if petrol hit 1.50 a litre in around 2 weeks.


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## wayneL (17 August 2007)

dubiousinfo said:


> That would be the Plunge Protection Team (PPT)
> 
> There are a few theads here on this issue, try a search.



I hear there is a new group that has just started - The PET (Plunge Exacerbation Team). They started of in the mortgage market and are having a crack at everything now.


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## caribean (17 August 2007)

Options expiration tonight, or rather tomorrow morning, could make it more interesting?
Maybe to the upside.


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## Porper (17 August 2007)

mick2006 said:


> Well guys is tonight the night that the global equity markets finally completely fall apart?




There are probably millions of headlines similar to this all around the world.

Maybe a case for a self fullfilling prophecy here.

It would probably be better to have a major panic & crash now rather than being in a slow prolonged decline.

There is one thing for sure, the richer will get richer and the poor, poorer.


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## mick2006 (17 August 2007)

what a difference an hour makes the hang seng is now only down 200 points after being down over 1100 points not that long ago.

I think you would have more chance to win the lottery than pick where the hell the markets will finish tonight.


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## Porper (17 August 2007)

mick2006 said:


> what a difference an hour makes the hang seng is now only down 200 points after being down over 1100 points not that long ago.
> 
> I think you would have more chance to win the lottery than pick where the hell the markets will finish tonight.




Well, the trend seems to be huge losses followed by big re-bounds to finish strongly.

Normally this would be very bullish.

In this market, means very little, but we should trade with the information we have.At the moment it is just extremely volatile.

My money is a bounce and a big, big sell off in a week or 2.


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## wayneL (17 August 2007)

Porper said:


> Well, the trend seems to be huge losses followed by big re-bounds to finish strongly.
> 
> Normally this would be very bullish.
> 
> ...



There is huge money in this market trying to support it, it's a confidence play, but I wonder if the masses will have to balls to jump in?

i.e. I wonder how strong any bounce will be. If I was an "investor" I would consider this market a pox to be avoided until much later.


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## GreatPig (17 August 2007)

If you held some put warrants and there was an '87 style crash with a drop of 30% or so, do you think the MM would give you fair value for the warrants or they'd just take their bat and ball and go home?

GP


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## Porper (17 August 2007)

wayneL said:


> There is huge money in this market trying to support it, it's a confidence play, but I wonder if the masses will have to balls to jump in?
> 
> i.e. I wonder how strong any bounce will be. If I was an "investor" I would consider this market a pox to be avoided until much later.




Well the smart money players could be playing us all.All these rebounds are right on fib support levels, maybe trying to lull us all into a false sense of security.

I was watching when the Dow was plummeting, as soon as the index started re-bounding  you could almost smell what was about to happen.It did, but I agree in that it was artificially being supported.Still this may well work.I won't be in without GSL'S that is for sure.

I think there will be big buying tonight from the protection team to boost confidence, we will see.


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## powerkoala (17 August 2007)

currently most of europe is trading higher.
will this influence US to be in green area as well or it will follow the smackdown in asia ?
what happen to hangseng and nikkei is scary, but hangseng rebound similar to asx when it went down 5% as well. so i guess US will be in green area today.


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## Smurf1976 (17 August 2007)

This is pure speculation on my part, but I wouldn't be surprised if someone really big has been seriously wounded in the credit market strife. Rams etc ain't big in that context.

I'm thinking in terms of a major investment bank or someone like General Motors etc finding themselves in serious trouble. I just can't believe that with so much happening the end result will be limited to a few hedge funds and non-bank mortgage lenders.


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## caleb2003 (17 August 2007)

LONDON (Thomson Financial) - The US Federal Reserve Bank has quietly relaxed its debt collateral rules, allowing borrowers to use distressed debt as collateral to raise emergency funds, the Telegraph reported, citing banking sources.

The change, carried out yesterday, means that banks are able to use asset-backed commercial paper (ABCP) loans as collateral to raise funds, the newspaper said. 

The Telegraph said this change in regulations, combined with a quiet reduction in the rate on four-week Treasury Bills to 4 pct, shows the Fed stepping in behind the scenes to prevent a meltdown across global markets.


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## >Apocalypto< (17 August 2007)

wayneL said:


> I hear there is a new group that has just started - The PET (Plunge Exacerbation Team). They started of in the mortgage market and are having a crack at everything now.




HA HA HA HA HA

Wayne that is a classic absolutely classic! 

LOL


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## chops_a_must (17 August 2007)

caleb2003 said:


> LONDON (Thomson Financial) - The US Federal Reserve Bank has quietly relaxed its debt collateral rules, allowing borrowers to use distressed debt as collateral to raise emergency funds, the Telegraph reported, citing banking sources.
> 
> The change, carried out yesterday, means that banks are able to use asset-backed commercial paper (ABCP) loans as collateral to raise funds, the newspaper said.
> 
> The Telegraph said this change in regulations, combined with a quiet reduction in the rate on four-week Treasury Bills to 4 pct, shows the Fed stepping in behind the scenes to prevent a meltdown across global markets.



But surely all that will do is make the ABCP's worthless as well?


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## brettc4 (17 August 2007)

A link for you.

Plunge_Protection_Team


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## clowboy (17 August 2007)

Anyone got a link for futures?  Ie what the Dow is likely to open at?

Thanks


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## vicb (17 August 2007)

Try this one
http://money.cnn.com/data/premarket/index.html


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## billhill (17 August 2007)

Smurf1976 said:
			
		

> This is pure speculation on my part, but I wouldn't be surprised if someone really big has been seriously wounded in the credit market strife. Rams etc ain't big in that context.
> 
> I'm thinking in terms of a major investment bank or someone like General Motors etc finding themselves in serious trouble. I just can't believe that with so much happening the end result will be limited to a few hedge funds and non-bank mortgage lenders.




have to agree with you here Smurf. This is why i am out of the market. So far this hole fiasco seems to be spreading further then anyones predictions. And if small mortgage lenders or hedge funds can spook the market into the current situation surely the risk is a huge collapse if a big player goes down. The risk of that occuring seem to be firming by the day.


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## insider (17 August 2007)

Some of the members over at HC think that the Dow is going to jump 200 plus tonight expecting the reserve bank to cut interest rates and some financials of other sectors like media and stuff... I hope not


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## BradK (17 August 2007)

Apparently the FED just cut .5 points off interest rates... havent seen it yet... big rumour though - effects? 

Brad


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## Bushman (17 August 2007)

insider said:


> Some of the members over at HC think that the Dow is going to jump 200 plus tonight expecting the reserve bank to cut interest rates and some financials of other sectors like media and stuff... I hope not




They have just announced that they have cut the discount rate on loans to banks by 50 bp.

http://www.cnbc.com/id/20316042/site/14081545


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## insider (17 August 2007)

I suppose they have to do something else... after all they've been pumping sooo much money into the markets and people keep cashing it all in...


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## bruno (17 August 2007)

before the cut in rates the doe futures was down nearly 200 pts.
i just had a look after reading about the cuts and its jumped to up 151 in no time.
this could be a very interesting night.


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## GreatPig (17 August 2007)

That (or something) has just put a rocket under the FSTE.

GP


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## Bushman (17 August 2007)

Europe has reversed as well. FTSE is up 4%, CAC 3%. Dow Futures have now turned up 250 pts. 

The market seems to like this.

Not sure about the long term wisdom of this? How long can the Feds prop up Wall Street financials by printing money? Guess they had to do something especially with the Yen rising against the USD and the Nikkei getting smashed 5% as a result.


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## Awesomandy (17 August 2007)

This is definitely looking like WW2. Japan is getting smashed, and Europe/America are celebrating.


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## Rob_ee (17 August 2007)

You've got to love that Yank logic.

All problems solved .. apparently..

DOW up 320 points in the 1st 10 minutes of trade after rate cut

Quite amusing to watch

Rob


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## moXJO (17 August 2007)

Rob_ee said:


> You've got to love that Yank logic.
> 
> All problems solved .. apparently..
> 
> ...




Hope it holds and our market follows been buying in on a few stocks these last 2 days.


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## Ken (17 August 2007)

Very Volatile.

Up and down like a yoyo.

Take profits when you can, depending on your strategy.

A lot of share prices will not recover chartwise.. they looks horrible.  And there's a lot of chartist who trade speculative stocks.


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## springhill (18 August 2007)

Rob_ee said:


> You've got to love that Yank logic.
> 
> All problems solved .. apparently..
> 
> ...




Like watching lemmings follow each other head first over a cliff :bonk:

OMG is that me turning bearish!!!???


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## Kauri (18 August 2007)

They might have played their pinch hitter a tad early... not a lot left on the bench to bring on when the subprimers score the next run....


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## insider (18 August 2007)

What happens when you put a bid beyond the offer say I bid $5 and someone is selling at $4.50?


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## resourcesman (18 August 2007)

agree with you there kauri
would have liked to see this a little later so that the effect of this cut would be more powerful


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## barnz2k (18 August 2007)

opened close to 3% up tonight?? But now back to 1% even.
Coul continue all over the shop again for rest of the day. If its strong before close will be good for uson monday.


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## Smurf1976 (18 August 2007)

What does the Fed know that the rest of us don't?

I'm now even more concerned that we'll soon be hearing about someone big in trouble. Either that or the Fed's actions are seen as the only way to keep them out of trouble, at least for the moment.

The other thing that usually is exposed after a boom is some type of major fraud. It's easy to keep things hidden when everyone's making a fortune in the markets. Not so once the music stops and odds are someone's done something they shouldn't have.


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## insider (18 August 2007)

hmmmm... seems like they are doing two steps forward one step back


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## resourcesman (18 August 2007)

I think its a symbolic move, to tell the market that they are watching and will react accordingly. I reckon its meant to calm the market a little


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