# The Crash of 05



## penfisher (8 October 2005)

I am a professional philosopher with an interest in Alchemy. My reading of the Planets says that the markets will Crash down from 22 October till May 2006. Not a cliffhanger, more a downhill slippery slope.


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## markrmau (8 October 2005)

It is worth considering what COULD cause a crash (timing unknown).

First thing to leap to mind is a US currency crisis. We all know of the inherent instability of the US deficit - asian nations lending the US money so the US can buy the stuff that asia produces.

All we need to find is a trigger which could cause the US consumer to falter......

October 4 – Bloomberg (Kathleen M. Howley):  “Manhattan apartment prices fell 13 percent in the third quarter, the most in 16 years, evidence the most expensive market in the U.S. may have peaked. The average apartment price dropped to $1.15 million from a record $1.32 million in the second quarter, according to a report today from Miller Samuel Inc…and Prudential Douglas Elliman, a Manhattan real estate broker. Prices had soared 30 percent in the previous three months.”



October 4 – New York Times (David Leonhardt and Motoko Rich):  “A real estate slowdown that began in a handful of cities this summer has spread to almost every hot housing market in the country, including New York. More sellers are putting their homes on the market, houses are selling less quickly and prices are no longer increasing as rapidly as they were in the spring, according to local data and interviews with brokers.  In Manhattan, the average sales price fell almost 13 percent in the third quarter from the second quarter… The amount of time it took to sell a home was also up 30.4 percent over the same period.  In another sign that the housing market might have reached a peak, executives at big home builders have sold almost $1 billion worth of company stock this year. Outside Washington, in Fairfax County, Va., the number of homes on the market in August rose nearly 50 percent from August 2004.”


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## Porper (8 October 2005)

markrmau said:
			
		

> It is worth considering what COULD cause a crash (timing unknown).
> 
> First thing to leap to mind is a US currency crisis. We all know of the inherent instability of the US deficit - asian nations lending the US money so the US can buy the stuff that asia produces.
> 
> .”





It's amazing , a couple of down days in an otherwise Bull market and we get the doom and gloomers out predicting crashes (not you Markrmau).

The US is in the crap, definately, but the old saying "If the US sneezes we all catch a cold" may not be quite as true as it once was.It certainly hasn't got the might it once had, having said that it will affect world markets if it does hit recession.We are already seeing a change in sentiment with Gold rising recently with the $US going up, this has previously not happened.

I think Gold stocks are the way to go now, hence that is where most of my money is.:jump:


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## tech/a (8 October 2005)

Porper said:
			
		

> It's amazing , a couple of down days in an otherwise Bull market and we get the doom and gloomers out predicting crashes (not you Markrmau).




I agree.
Mind you they predict at every down turn over 100pts---happened in April/May.

Eventually they get it right and are hero's in their own lunchtime.
I'm happy to knock them everytime as I know I'll be right 90% of the time and take long lunches.


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## wayneL (8 October 2005)

tech/a said:
			
		

> I agree.
> Mind you they predict at every down turn over 100pts---happened in April/May.
> 
> Eventually they get it right and are hero's in their own lunchtime.
> I'm happy to knock them everytime as I know I'll be right 90% of the time and take long lunches.




Some may try to call the crash, other just acknowledge the possibility. 

I used to drive past this big shed in the middle of a paddock. (you could see it from the highway) This shed was old, rusted and dilapidated; and had a bit of a lean to it.

Everybody knew that one day it would fall over, heck, it looked as though it shoulda gone ages ago.

But there it stood resolutely and defiantly, against every storm and strong wind. We used to have bets on when it would go over. It never did....

....so we gave up betting on it. _The bloody thing will never fall down!!!!_

One day I was driving past not long after we had given up and there it lay, in a crumpled twisted heap! It had finally gone over.

*I'm glad I never stored anything valuable in that shed.*

Cheers


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## tech/a (8 October 2005)

Wayne.
I'll bet one of your mates who got sick of waiting went and cut it down!!

Now that could be likened to a few % rates rise.
Or a drop in the US$ of a few cents.
Rampant inflation.

Remember the recession we had to have.

This could be orchestrated/triggered by--- for the longterm ---errr--good.


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## Knobby22 (8 October 2005)

I think we have to get around this US economy thing.
China is where it is happening and India, Asia, the US is losing influence.
I don't expect the US stockmarket to do well but the Aussie market is fairly priced. We had great returns last year and they won't suddenly stop.

We have no where to fall, if there are major falls then I will be borrowing as much as I can to buy. Also, there is the weight of money theory.

I am confident there will be no more than a 10% retrace AT WORST.


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## johnno261 (8 October 2005)

Porper said:
			
		

> It's amazing , a couple of down days in an otherwise Bull market and we get the doom and gloomers out predicting crashes (not you Markrmau).
> 
> The US is in the crap, definately, but the old saying "If the US sneezes we all catch a cold" may not be quite as true as it once was.It certainly hasn't got the might it once had, having said that it will affect world markets if it does hit recession.We are already seeing a change in sentiment with Gold rising recently with the $US going up, this has previously not happened.
> 
> I think Gold stocks are the way to go now, hence that is where most of my money is.:jump:




Porper in agreeance with  you in regards to all of the pessimistic gurus come outta the woodwork after a couple of bad days on the ASX and all of these fiction predictions of a crash. Come on people do you think the rest of us are all that stupid too.
Have a look at the worlds economy's, sure I agree US economy is struggling, but hey we have China, India, Phillipines, and Australia's ecenomy's all pumpin along very well. 
Simply market sentiment and behaviour for the Month of October. A healthy correction with what is generally a poor month on the markets!!!!


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## tech/a (8 October 2005)

Knobby22 said:
			
		

> I think we have to get around this US economy thing.
> China is where it is happening and India, Asia, the US is losing influence.
> I don't expect the US stockmarket to do well but the Aussie market is fairly priced. We had great returns last year and they won't suddenly stop.
> 
> ...




Very very good point.
Must remember that in my next discussion.


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## wayneL (8 October 2005)

All fine points.

But this all presupposes that the world economy will stay "as is" in its present or developing status quo.

I think there are great risks that things will change radically at some point or another. The whole health of the world economy hinges on the the contimued and *growing* consumption of consumer items.

This is a folly on a number of grounds.

I'm not calling a crash...perhaps a correction. What I see is a developing and extended bear '70's style. When this begins is anybodies guess.

But as always there will be opportunities. It is only doom and gloom for the *unwary*. It will make some of us rich.

Cheers


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## tech/a (8 October 2005)

wayneL said:
			
		

> All fine points.
> 
> But this all presupposes that the world economy will stay "as is" in its present or developing status quo.
> 
> ...




Ahhh Wayne---my next discussion!!

Wayne unless there is another WW
OR ZPG is finally declared.
OR an Asteroid hits.

Why wouldnt Asia,China,India continue to flood demand?
These countries have over 70% of the worlds population and have only just begun to consume a gluttonous rates.
When its been touted that China will over take the USA as the worlds richest economy---I think Knobby has a point--these guys will be throwing petrol on the growth sectors not water!!

*Isnt it quite possible we could get the EXACT OPPOSITE--un precidented un paralleled growth.*

Interested in your/my/our "Folly"?


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## Smurf1976 (8 October 2005)

IMO the US Fed will carry on raising interest rates until something breaks.

That's the historic precedent and I see no reason for it to be any different this time. If they were going to go soft on the rate rises then surely after the hurricane was the time but even that wasn't enough to stop them.

So the question is what breaks, when does it break and what are the consequences? The break won't necessarily be in the stock market but will be somewhere in the economy.

Or is this the one time that really is different?


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## el_ninj0 (8 October 2005)

I agree tech, I have been thinking the same thing since for quite some time. India/indonesia/china are the three biggest growth markets in the world at the moment. I can only see more positive growth. All we have seen in the past few days is rapid overselling of companies that are major players in growth all around the world, i.e BHP,MBL,RIO. Those industries are never going to cease to be profitable. I feel as though this whole situation has been ramped up.


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## markrmau (8 October 2005)

tech/a said:
			
		

> These countries have over 70% of the worlds population and have only just begun to consume a gluttonous rates.




I think you've hit the nail on the head here - it is all about consumption. No point in Oz digging up all our dirt if the rest of the world doesn't put up the manufacturing and consumption chain behind it.

The good news is that the Chinese are fantastic consumers when they have the spare dosh. They are even more frivolous and extravagent than the Americans (no offence intended).

The bad news is that it is only a minority of the masses of Chineese that are awash with cash. The rest are working for pittance and saving like buggery. Not consuming. I still think we need the US to power along for another few years yet.

India is coming up as a vital world economic player as well (with far freeer and open markets than china) however they may take even longer (10years?) to get going.

I don't mean to come accross as all doom and gloom. It is all about assessing risks to me.


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## wayneL (8 October 2005)

tech/a said:
			
		

> Ahhh Wayne---my next discussion!!
> 
> Wayne unless there is another WW
> OR ZPG is finally declared.
> ...




This could happen, but the result will be more dire than ww etc. The planets ecology is in deep **** from the gluttonous consumption of the 30%.

If the eastern economies overtake the west, without destroying the planet somehow. This will be a negative for western economies. We will become the third world. The beginning stages of this as being seen in UK, US already. But as I say, there is opportunity in this for those with their eyes open.

A cleansing depression will be good for the long term health of both the world economy, and the planet.

Cheers


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## Happy (8 October 2005)

Once we realise what we have to do, 1 child per couple might be mandatory for a while, 

(As a side thought, right might be traded for bonus from government or between couples, suppose single person could trade half – too much sidetrack already)

Of course, if the World doesn’t get derailed in some other catastrophic way.


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## It's Snake Pliskin (8 October 2005)

wayneL said:
			
		

> This could happen, but the result will be more dire than ww etc. The planets ecology is in deep **** from the gluttonous consumption of the 30%.
> 
> If the eastern economies overtake the west, without destroying the planet somehow. This will be a negative for western economies. We will become the third world. The beginning stages of this as being seen in UK, US already. But as I say, there is opportunity in this for those with their eyes open.
> 
> ...




I agree with you here Wayne. I once heard that it would take three Earth sized planets to sustain the consumption that we know if the entire population of the world lived like the western countries do.

Remember Japan, yes that infamous bubble. Their sharemarket is still running well low of its peak over a decade ago. Ask many Japanese what they think of the market. China is in for the same in the future. Economies can only grow so far and there is nothing to refute this.


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## Smurf1976 (8 October 2005)

The growth in resource use and pollution from China alone dwarfs anything the developed world, USA included, could realistically do to cut consumption.

For example, greenhouse gas emissions are set to soar in the coming decades with or without the Kyoto Protocol that is supposed to reduce them. The only meaningful difference being that the point of discharge moves to the Kyoto-exempt countries (especially China) if the Protocol is in force. 

ANY measure to cut resource use, pollution etc. only works if EVERY country is bound by the same terms. Just one exemption and the pollution simply shifts to that country. And since carbon dioxide (the main greenhouse gas) has long term global but not short term local effects the exempt country loses nothing in the short term whilst gaining economically.

The challenge is thus for a truly global system to protect the environment where every country is on exactly the same terms. Not likely until it's too late or technology renders it unnecessary.


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## KaiserBun (8 October 2005)

penfisher said:
			
		

> I am a professional philosopher with an interest in Alchemy. My reading of the Planets says that the markets will Crash down from 22 October till May 2006. Not a cliffhanger, more a downhill slippery slope.




As a Pisces, i guess i should stick to stocks that deal with water.


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## Knobby22 (8 October 2005)

Planetary ecology problems -what happens in five years is another story.
Human greed is consistent -why can't the Chinese have TVs and cars?

Wars are fought over resources and resources are running out.

Global warming is real and thermal runaway is a real possibility - people dying as termperatures rise to 50 degrees and the polar caps melt.

There is a quick cure for thermal runaway however - remember the winter problem with nucleur war? A couple of nukes in well selected places will drop temperatures overnight! 

Ahh technology - it will provide an answer to all our problems!

Cynical?


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## DTM (9 October 2005)

Sorry to be the dissenter.  I think the Aussie markets have had their run and are now getting ready for the down side.  The US will go into a recession but will recover from it, not as quickly as it did before, but recover it will.  Watch out for the boom in Australia once the Americans start powering up again.  

Otherwise, I wouldn't be holding shares but Cash, in USD.


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## Milk Man (9 October 2005)

wayneL said:
			
		

> Some may try to call the crash, other just acknowledge the possibility.
> 
> I used to drive past this big shed in the middle of a paddock. (you could see it from the highway) This shed was old, rusted and dilapidated; and had a bit of a lean to it.
> 
> ...




This shed wasnt in Canungra (Gold Coast hinterland) was it? Coz' we used to do the exact same and the exact same thing happened! 

As for the world economy: china/india's growth is being driven by US consumers. Once that cherry pops so does theirs! Being that their main resource is man-power I cant see that any sort of consumerism is sustainable on any level. Does anyone know whether they have to import food? If so theyre FUBAR IMO.


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## Hanrahan (9 October 2005)

I'm unconvinced that India and China could replace the Yanks as "consumer of last resort". In spite of America's huge trade deficit with China, China is in deficit with the rest of tthe world so exports are absolutely critical to them.

I look at America's "China experiment" as their second great venture into slavery. 

The first finished badly when the slaves were freed and were not sent back where they came from. This time they contracted the Chinese Mandrins to be slave masters of their own people. This way the slaves remain on the other side of the world     

This cosy arrangement is unravelling now :goodnight  How this will play out is what this discussion is about and I don't claim any foresight. ergo I am heavily into PMs. I will also admit to having a little of Hanrahan in me and I'm trying not to be rooned.


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## markrmau (9 October 2005)

ASX is getting cained because of concerns of poor world growth leading to crash in commodities prices.

Look at the continuos commodity index. Is it trending up or down? And this includes the big drop in oil last week. It doesn't show the same drops as seen in SP500 or XJO. I just don't see the need for panic YET.


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## Yippyio (9 October 2005)

markrmau said:
			
		

> It is worth considering what COULD cause a crash (timing unknown).
> 
> First thing to leap to mind is a US currency crisis. We all know of the inherent instability of the US deficit - asian nations lending the US money so the US can buy the stuff that asia produces.
> 
> ...




Property slow down in the states, that is excellent news for equity markets, people pulling out of real estate will be looking for new areas to park their money and it's either in real estate or it's in shares or it's under the bed.

This sounds more to me like the beginning of a bull market. Thanks for the update.


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## johnno261 (9 October 2005)

*Re: Outlook*



			
				Yippyio said:
			
		

> Property slow down in the states, that is excellent news for equity markets, people pulling out of real estate will be looking for new areas to park their money and it's either in real estate or it's in shares or it's under the bed.
> 
> This sounds more to me like the beginning of a bull market. Thanks for the update.




Do agree, our housing market is in the same situation here in Oz and there will be lots of money looking for a home and I do believe this is the start of even a stronger trading period than we have had before.


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## Milk Man (9 October 2005)

Yippyio said:
			
		

> Property slow down in the states, that is excellent news for equity markets, people pulling out of real estate will be looking for new areas to park their money and it's either in real estate or it's in shares or it's under the bed.




The smart thing to do would be to pay off their debts.


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## TheAnalyst (9 October 2005)

it aint a crash and what about 4 months ago when hey were saying that was a crash and it wasnt.

That would mean we have had two crashes this year.


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## Porper (9 October 2005)

*Re: Outlook*



			
				johnno261 said:
			
		

> Do agree, our housing market is in the same situation here in Oz and there will be lots of money looking for a home and I do believe this is the start of even a stronger trading period than we have had before.





:iagree:  I think that it maybe simplistic and I may be naive but money is moving out of property, so it has to go somewhere, and why not the stock market.The Dow Jones has performed poorly compared to other markets so, yes, America in a bit of a state but maybe that won't affect the US market as much as we think.Just maybe the surplus money will be invested in shares.


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## penfisher (9 October 2005)

We see cycles after the fact. If we could see them before, then there would be no market activity per se. The Reserve will fear inflation and raise rates; stocks will fall because - wink wink nudge nudge - and property will not take the excess money from share sales... hung property market till mid 2006. The money will go where it always goes... offshore banks.


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## happytrader (9 October 2005)

Who cares! Start hedging!

Happytrader


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## wayneL (9 October 2005)

happytrader said:
			
		

> Who cares! Start hedging!
> 
> Happytrader




The smartest thing said so far!

Cheers


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## Fleeta (9 October 2005)

KaiserBun said:
			
		

> As a Pisces, i guess i should stick to stocks that deal with water.




Cracker of a line this. I'm a libra so what stocks should I be buying?


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## el_ninj0 (9 October 2005)

wayneL said:
			
		

> The smartest thing said so far!
> 
> Cheers




Sorry for my ignorance, but hedging? Care to explain please.


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## Milk Man (9 October 2005)

el_ninj0 said:
			
		

> Sorry for my ignorance, but hedging? Care to explain please.




Its when you grow plants in close proximity to each other then prune them so they look like one plant. : 

Nah- its like having one each way; so if the market crashes youre not completely FUBAR. As in buying gold if you fear a market crash. 

FUBAR: Of 'Tango and Cash' fame. Last 4 words= up beyond all recognition.


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## wayneL (9 October 2005)

Milk Man said:
			
		

> This shed wasnt in Canungra (Gold Coast hinterland) was it? Coz' we used to do the exact same and the exact same thing happened!




This one was in Victoria, but funnily enough, I used to live on Biddaddiba Rd (you'll know where that is  ) and recall similar sheds...that black soil virtually spits the posts from those sheds straight out of the ground eventually LOL.



			
				Milk Man said:
			
		

> FUBAR



LMFHO!


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## Stan 101 (9 October 2005)

just left New York and while waiting for a plane on a very rainy day in downtown, I started listening to some economists on a tv economic roundup show. They ´ve noted that in the last 8 (?) interest rate increases, consumer spending has not waivered. This is quite amazing considering that fuel prices have doubled in recent times (still good by world standards, though). Americans are still dipping into their equity at astonishing rates as they continue to buy buy buy!

I wonder what will break first?

cheers,


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## SmallStocks (10 October 2005)

What happened in the Market over the last week? This review was conducted on Thursday

What caused it all? A good question that deserves some comment.

To begin with, the US stocks ended significantly lower last night, with the Dow Jones and the S&P 500 Index hitting their lowest periods for the last 3 months. Concern about inflation, slower general economic growth rates and the talked up chat regarding interest rate hikes in the US were all felt in other markets. The dampening of the DJ Index and S&P softened a more positive reaction to the news regarding the easing of the crude-oil prices - now that the effects of Hurricane Rita have realistically moved on.

What was the trigger? Well on Tuesday in the in the States three bank presidents of the federal reserve suggested that the US Fed would most likely raise short-term interest rates to keep inflation reduced within the US Economy. This led to general negative market sentiment, which impacted the US Equities market whereby sellers took control of the buyers on both the NYSE and the NASDAQ with more than 1.91 Billion and 1.95 Billion shares being exchanged by traders respectively.

Another point to mention is the over zealous reaction that Hurricanes Katrina and Rita have caused and the consequent after effects felt by them. Crude Oil closed slightly under $63 a barrel, caused by a drop in US heating-oil and gasoline demand.

How has this affected the world markets? As previously mentioned, the rest of the world reacted negatively to the latest US losses and the Asian markets were no exception. The Tokyo Nikkei closed at 13,359.51 today which was followed by Hong Kongs Hang Seng, which fell a further 2.1%. Furthermore, there is now more speculation that Great Britain may not be able to ride out this downturn as easily as it did the 1999 financial disaster that hit the US and Europe. While its unemployment and growth are at "recordly" positive levels for the Poms, the majority of Britain’s trade is derived from Europe and Europes current slump has set many global analysts to switch on their cautious buttons.

So when you tie all this back into the Aussie market, you can see why the market has fallen so rapidly in such a short period. Construction group Rinker led the decline because of its strong construction affiliation with the US Growth market - ironic as many investors assumed it would increase in the wake of Hurricane Katrina. Of the other main market movers we see that BHP, Comm. Bank and Woodside were all negatively impacted.

So what does this mean for Small Stocks? Well the Small Ord’s fell 69.9 points or 2.7% which is expected on such negative market sentiment throughout the rest of the world. While this may trigger a cause for concern, it is generally accepted that the "everything that goes up, must come down". The key is not to fret! The recent booms in the Australian market have consequently meant that some sort of downturn was imminent - batten down the hatches, keep an eye on your portfolios and weather the storm for this seasonally weak period.


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## krisbarry (10 October 2005)

Australian market could ease

By Jeff Turnbull

09oct05

THE Australian share market, bruised and battered after last week's $40 billion rout, could slip a little farther over the next few days but remains well supported, according to analysts.

In a stampede of profit taking, the losses are now being described as "the correction we had to have" and not the beginnings of a bear market.

CommSec chief equities economist Craig James said the companies that suffered the most last week were the same ones that rode the market to the top.

"These companies are the key casualties of recent profit-taking but fundamentally the sharemarket is well supported," Mr James said.

He said domestic and global economies continue to expand while the main risk to profits is rising costs. 

"Consumers have become more conservative about spending and borrowing decisions in response to higher petrol prices and the flattening in house prices," Mr James said.

"But consumers are well supported by a strong job market, rising wages and tax cuts."

He said the sharemarket correction was prompted by fears of higher inflation and interest rates in the US.

"But the jitters over the inflation in the US have just proved to be a good excuse for domestic investors to engage on some healthy profit-taking."

AMP Capital chief economist Dr Shane Oliver said although the correction had a little steam left in it he still expected the market to hit record heights by the end of the year.

"The recent slump in Australian shares should be seen as a correction rather than the start of an extended fall," Dr Oliver said.

"Although the correction may still have a little further to run, we expect the market to be making new highs by the end of the year and into next years and, as such, should be seen as a good buying opportunity."

In the week ahead, the market will be paying close attention to a speech to be given by Reserve Bank of Australia deputy governor Glenn Stevens in Hobart on Tuesday.

"While Glenn Stevens might express some concern about inflation, our assessment is that with housing still slowing and households under pressure from high petrol prices the message will be one of rates remaining on hold for now," Dr Oliver said.

The S&P/ASX200 index will open tomorrow at 4440.6 after slipping 6.7 points last Friday and the all ordinaries commences trading at 4400.1 after firming 1.72 points at last week's close.

The market will take some encouragement from the upward direction in the US where the Dow Jones industrial average added 5.1 points to 10,292.31 last Friday and the Standard & Poor's 500 Index improved 4.41 points to 1195.90.

The Nasdaq Composite Index advanced 6.27 points to 2090.35. 

Source: 

http://www.theadvertiser.news.com.au/common/story_page/0,5936,16867304%5E1702,00.html


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## TjamesX (10 October 2005)

All you TA guys are gonna love this - new signal to add to your systems

The Hindenburg Omen

http://safehaven.com/article-3880.htm

All the biggies over the past 21 years were identified by this signal (as defined with our five conditions). It was present and accounted for a few weeks before the stock market crash of 1987, was there three trading days before the mini crash panic of October 1989, showed up at the start of the 1990 recession, warned about trouble a few weeks prior to the L.T.C.M and Asian crises of 1998, announced that all was not right with the world after Y2K, telling us early 2000 was going to see a precipitous decline. The Hindenburg Omen gave us a three month heads-up on 9/11, and told us we would see panic selling into an October 2002 low. And now we have another confirmed Hindenburg Omen signal, here in the autumn of 2005.

TJ


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## TheAnalyst (10 October 2005)

How much does it cost??


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## johnno261 (10 October 2005)

TheAnalyst said:
			
		

> How much does it cost??




Two Red days and people are talking about a crash.C'mon Company's are trading on very healthy PE's and to compare this cycle with 1987, has no real cyclic comparison.


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## wayneL (10 October 2005)

johnno261 said:
			
		

> Two Red days and people are talking about a crash.C'mon Company's are trading on very healthy PE's and to compare this cycle with 1987, has no real cyclic comparison.




Those weren't just ordinary red days.......

This move represents a significant increase in statistical volatility and is certainly a "heads up" event. It's like a shot across the bow. It doesn't mean the market will crash, but it is "action stations" and potentially something could develop from this, we don't know.

Healthy P/E's? This is a very subjective measure. I think P/E's, considering the risks now inherent in the world economy, are high, generally. There is no risk premium for mine. But thats just my opinion. 

No cyclic comparison? Oh one must look a bit further back, there are comparisons galore!!!!!!!!!!!!

Cheers


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## penfisher (11 October 2005)

Listen folks. This Crash is not about simplistic market forces analysis, it is about major planetary cycles. There will be another major natural disaster &/or politically motivated action within 7-10 days. The market will turn around and not look back until it skids in May 2006. This is the end of a solar cycle, or more correctly a mid-point when action reverses. Sell within 7 days and damn the naivety of capitalist theory. Convert to property even though interest rates will mistakenly be raised [?0.25%] by the Reserve... in April-May 2006 they will probably be forced to reduce again by 0.5%. Listen if you have ears to hear.


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## krisbarry (11 October 2005)

penfisher said:
			
		

> Listen folks. This Crash is not about simplistic market forces analysis, it is about major planetary cycles. There will be another major natural disaster &/or politically motivated action within 7-10 days. The market will turn around and not look back until it skids in May 2006. This is the end of a solar cycle, or more correctly a mid-point when action reverses. Sell within 7 days and damn the naivety of capitalist theory. Convert to property even though interest rates will mistakenly be raised [?0.25%] by the Reserve... in April-May 2006 they will probably be forced to reduce again by 0.5%. Listen if you have ears to hear.




Are you serious or what?, sounds like a lot of gobble if you ask me.

What proof do you have?

Would you like to post some planetary charts to prove your point?

Look I read my stars in the paper ,virgo, but you have to be kidding with all this gabble, hocus-pocus....

next you will be telling us that the end of the world is near, and Jesus is coming.

We live on a planet that is prone to natural disaster, mankind just likes to think that we can control everything around us- not possible!

Get A GRIP!


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## doctorj (11 October 2005)

Time to 'go long' tin foil hats and cans of baked beans.


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## Rockon2 (12 October 2005)

Hhahahaahahahahahahahahahhahahahahaahahhaahahahahahah 

Mind you ive got my shorts on :rocketwho


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## Porper (12 October 2005)

penfisher said:
			
		

> Listen folks. This Crash is not about simplistic market forces analysis, it is about major planetary cycles. There will be another major natural disaster &/or politically motivated action within 7-10 days. r.





Well looks like you have all the options covered Penfisher.

Of course there will be a natural disaster or political action within 10 days, there always is.You don't need to gaze at the stars to work that one out.

No doubt you will be patting yourself on the back when something happens, shouting I told you so from the roof tops.


----------



## Milk Man (12 October 2005)

penfisher said:
			
		

> Listen folks. This Crash is not about simplistic market forces analysis, it is about major planetary cycles. There will be another major natural disaster &/or politically motivated action within 7-10 days. The market will turn around and not look back until it skids in May 2006. This is the end of a solar cycle, or more correctly a mid-point when action reverses. Sell within 7 days and damn the naivety of capitalist theory. Convert to property even though interest rates will mistakenly be raised [?0.25%] by the Reserve... in April-May 2006 they will probably be forced to reduce again by 0.5%. Listen if you have ears to hear.




ROTFLMAO That is the funniest thing I have ever heard! You are joking? Aren't you? . Wooooooooo..... I am so shaking in my boots. Hey the moons tipped up so it must be going to rain.  

P.S- Did you know they took the word gullible out of the dictionary?


----------



## johnno261 (12 October 2005)

To wake up to hear that the DOW is up 14 points is not going to give our markets much confidence unfortunately. We need to tread carefully and watch the DOW closely. I too wish that we wer'e not so attached to the US, because our economy would ensure a Bull market for many decades, but i do believe the US can pull us all down unfortunately, regardless of our robustness.(such a word)??


----------



## TheAnalyst (12 October 2005)

hey i just went out side and seen a full moon and came back in and looked into my crystal ball which is supported by a gann chart made out of rocks from the vally of meggido (armageddon in hebrew) and i had a vision of this crash of 05 and seen the planetary alignment had Mars move half an inch and that caused demonic negative waves and it was at the same time the surface of Australia reflected the moon light on to Satans butt that we had the crash. He is due to get up and give us another crash tommorrow.


----------



## johnno261 (12 October 2005)

TheAnalyst said:
			
		

> hey i just went out side and seen a full moon and came back in and looked into my crystal ball which is supported by a gann chart made out of rocks from the vally of meggido (armageddon in hebrew) and i had a vision of this crash of 05 and seen the planetary alignment had Mars move half an inch and that caused demonic negative waves and it was at the same time the surface of Australia reflected the moon light on to Satans butt that we had the crash. He is due to get up and give us another crash tommorrow.




Your sure to get it right about a Crash if you go on with it forever. One day you'll be correct, but not just yet in my opinion.
UBS and Barclays have both come out today with upgraded forecasts for resource outlook on  base metal companys. Demand is outstripping supply in many cases.Good news!


----------



## It's Snake Pliskin (12 October 2005)

TheAnalyst said:
			
		

> hey i just went out side and seen a full moon and came back in and looked into my crystal ball which is supported by a gann chart made out of rocks from the vally of meggido (armageddon in hebrew) and i had a vision of this crash of 05 and seen the planetary alignment had Mars move half an inch and that caused demonic negative waves and it was at the same time the surface of Australia reflected the moon light on to Satans butt that we had the crash. He is due to get up and give us another crash tommorrow.




Ha, ha, ha..... too funny!  

Last week's drops were because of the bushfire on the moon and tornadoes on Saturn. There was a link to the New Orleans hurricane, but it took some time to come to light. In the meantime the bushfire got away on everybody and the markets took fright. Everything is under control now, but they are urging everybody to be cautious for the rest of the season.
I've got my hose ready for when the sun blows up and then I'm going to buy at the bottom, because I think I'll find some value then.  :iamwithst


----------



## ob1kenobi (13 October 2005)

Just browsing the NYSE site. By 11:44am 12 October (US Time), most of their indicators were down. Could be an interesting day on the ASX on Thursday 13 October. Time will tell! 

--------------------------------







Powered by NYSE MarkeTracNYSE Market:
*Open
NYSE Volume 680,456,610*

AS OF 11:44 ET 12 Oct 2005
*US Indexes             Value           Change*
*NYSE COMPOSITE* 7346.2234.59 V
*NYSE US 100*        5809.076.61 V
*NYSE INTL 100*     5215.8326.14 V
*NYSE WRLD LDRS* 5625.5315.70 V
*NYSE TMT*            5125.8027.41 V
*DOW JONES IND*   10259.015.84 ^
*S & P 500*            1181.213.66 V

VIEW ALL INDEXES
From http://www.nyse.com
---------------------------------------------


----------



## clowboy (13 October 2005)

My thoughts


Another day of RED.


Probaly wrong.


----------



## el_ninj0 (13 October 2005)

clowboy said:
			
		

> My thoughts
> 
> 
> Another day of RED.
> ...




Who knows any more, this is crazier than a bull seeing red.
(bulls are colour blind if you didn't know).


----------



## TheAnalyst (18 October 2005)

"Hey";what is going on?Where is the crash this week?Where are all you doomsayers?


----------



## Aussiejeff (19 October 2005)

TheAnalyst said:
			
		

> "Hey";what is going on?Where is the crash this week?Where are all you doomsayers?




Haha!

Mebbe todays "worst US inflation figures in 31 years!" blurb on the radio this morning might panic a few bulls... and if you look at the last 5 years charts US stocks have never outperformed around this time of year - might have something to do with the preponderance of hurricanes and associated damages...??

Hang on to yer hats and have a happy Red Day...

AJ


----------



## TheAnalyst (19 October 2005)

It aint red enough to call it a crash.


----------



## mit (19 October 2005)

TheAnalyst said:
			
		

> It aint red enough to call it a crash.




Getting Redder all of a sudden. Anyone know why?

MIT


----------



## markrmau (19 October 2005)

mit said:
			
		

> Getting Redder all of a sudden. Anyone know why?MIT




My guess is that in US overnight (11am or so here) one of the US reserve bank board members said that current US interest rates were at the bottom of the neutral range which she put at 3.5-5.5%.

Plenty of upside to US rates possible then. US could drop another >1% tonight.

Also US housing bubble comments (despite Greenspan trying to rewrite history a little  )


----------



## TjamesX (19 October 2005)

After adding to my holdings a couple of weeks ago, I reversed this at open today. Now back down to < 30% shares.

Producer price reports overnight in the US are what really concern me - the day before it was GM posting a larger loss than expected. I think some bad fundamentals are slowly rising to the surface. At the moment the question in the US is how the companies are dealing with higher input prices, two options;

1) Pass them onto the consumer - up inflation - up interest rates - consumers tank under debt - bad
2) Don't pass them onto the consumer - margins squeeze - profit hurt - bad

Pretty much a rock and a hard place if you ask me.

i think this could lead to a re-weighting of what investors are willing to pay for earnings (re sharemarket slide) and it may take a while for it to play out. Im not willing to play it too cute for any upside at the moment   

???


----------



## Smurf1976 (19 October 2005)

IMO the US market reached a long term top over 5 years ago that won't be exceeded for many years yet.

If the ASX was outperforming the US markets then I could see a bullish case for our market. But right now the US markets fall a bit and the Aussie market falls a lot more which is starting to worry me somewhat.


----------



## TheAnalyst (19 October 2005)

If investors have listened to the advice of the Financial Planning association and its skilled and qualified members they would be diversified and not worried about a crash or any of the events of the last 2 weeks.


----------



## Milk Man (20 October 2005)

TheAnalyst said:
			
		

> If investors have listened to the advice of the Financial Planning association and its skilled and qualified members they would be diversified and not worried about a crash or any of the events of the last 2 weeks.




What, with all those "great" managed funds that give the planners payola? Lets get one thing straight: there are financial planners and there are salesman. I fear most fall into thar second category. If you got one of the latter, where do you think your money would be? In funds that cant beat the index no doubt.


----------



## Aussiejeff (20 October 2005)

Oh dear! Not ANOTHER rebound! DJIA up 120+ pts ... shoo bears, SHOOO!

;o)

It's enough to give us motion sickness!

AJ


----------



## TheAnalyst (20 October 2005)

Financial planning is not just about picking funds as there are many issues involved such as; risk management, portfolio structure, capital protection, fulfilling the many legal issues, retirement planning, estate planning, taxation, superannuation, risk profile and it goes on. A planner is not just a salesman it is actually a lot more than that.

Financial planning is also about direct share investment to someone with the relevant risk profile for direct share investment and the reason why people are advised and choose funds is because of the ease of management.


----------



## michael_selway (21 October 2005)

mit said:
			
		

> Getting Redder all of a sudden. Anyone know why?
> 
> MIT




yeah US jumped 100+ while all ords dropped?


----------



## Aussiejeff (21 October 2005)

michael_selway said:
			
		

> yeah US jumped 100+ while all ords dropped?




Well whaddya know.... US SLUMP overnight of over 120- after yesterdays JUMP. Sure are jittery critters over thar!

Nosebleed day in the AllOrds again???

Cheers,

AJ


----------



## el_ninj0 (21 October 2005)

If we are going by previous days experiances, then we are in for another big fall. More like a river of red than a nosebleed.


----------



## mit (21 October 2005)

I read somewhere that the magnitude of the ''87 crash caused in large part by the use of portfolio insurance. Well it's back

http://www.smh.com.au/news/Business/Share-price-insurance-launched/2005/10/21/1129775932139.html

MIT


----------



## Bronte (21 October 2005)

21st-September-2005, 05:13 PM  

Re: Last check, then ready to go...... 

Please do not start buying any stocks now during this timeframe.
(See "Trading the SPI")
Keep learning, reading, asking questions until Oct/Nov.

_An old quote from "Last check, then ready to go...._


----------



## Yippyio (21 October 2005)

Some great buying ops out there. The only problem is I am right into my margin buffer and all I can do now is sit and watch.

 :freak3:


----------



## It's Snake Pliskin (21 October 2005)

Yippyio said:
			
		

> Some great buying ops out there. The only problem is I am right into my margin buffer and all I can do now is sit and watch.
> 
> :freak3:




I agree! I bought BHP $19.51.


----------



## mit (21 October 2005)

Bronte said:
			
		

> 21st-September-2005, 05:13 PM
> 
> Re: Last check, then ready to go......
> 
> ...




Bronte,

It's October now. Are you saying you are bullish or bearish?

Mit


----------



## RichKid (21 October 2005)

Bronte said:
			
		

> 21st-September-2005, 05:13 PM
> 
> Re: Last check, then ready to go......
> 
> ...




Bronte,
I'm sure you mean well and even if I agree with your view we have to be careful to ensure any views are not considered to be financial advice. If by some chance the market bounces and people lose out on profits due to reliance on your view then there is the real chance of being blamed for 'bad advice'. This is just my understanding of ASIC's view and the general law.

I do agree that it is worth learning and reading and questioning all the time.


----------



## Yippyio (21 October 2005)

Snake Pliskin said:
			
		

> I agree! I bought BHP $19.51.




BHP making a stirling come back, well done Snake.


----------



## It's Snake Pliskin (21 October 2005)

Yippyio said:
			
		

> BHP making a stirling come back, well done Snake.




Thankyou.

I got more of ADB too. It really spiked low today and picked it up on the rebound. I have an average price $12.40. "I'm excited" as big Kev would say.


----------



## TheAnalyst (21 October 2005)

RichKid said:
			
		

> Bronte,
> I'm sure you mean well and even if I agree with your view we have to be careful to ensure any views are not considered to be financial advice. If by some chance the market bounces and people lose out on profits due to reliance on your view then there is the real chance of being blamed for 'bad advice'. This is just my understanding of ASIC's view and the general law.
> 
> I do agree that it is worth learning and reading and questioning all the time.




Yes, you are right under division 7.7 of the corps act s945A States the "know your client rule" which mean that you must know your clients or anybody who may take into account your financial advice, this includes a recommendation not to obtain or not to sell it is still considered advice under the act and can only be given once you have ascertianed the persons objectives, financial situation & needs by proper investigation.

s945B states an obligation to warn a person if the advice is based on incomplete information or inaccurate information and s949A states that a person must be warned that the advice has not been prepared taking into account the persons objectives, financial needs and situation.

Under part 7.7 there is a criminal liability by not providing a Statement of Advice and Financial Services Guide and there is also a civil liability under part 7.7 which imposes a civil liability for loss or damage for contravention of provisions of part 7.7 (includes the FSG and SOA obligations)


----------



## It's Snake Pliskin (21 October 2005)

TheAnalyst said:
			
		

> Yes, you are right under division 7.7 of the corps act s945A States the "know your client rule" which mean that you must know your clients or anybody who may take into account your financial advice, this includes a recommendation not to obtain or not to sell it is still considered advice under the act and can only be given once you have ascertianed the persons objectives, financial situation & needs by proper investigation.
> 
> s945B states an obligation to warn a person if the advice is based on incomplete information or inaccurate information and s949A states that a person must be warned that the advice has not been prepared taking into account the persons objectives, financial needs and situation.
> 
> Under part 7.7 there is a criminal liability by not providing a Statement of Advice and Financial Services Guide and there is also a civil liability under part 7.7 which imposes a civil liability for loss or damage for contravention of provisions of part 7.7 (includes the FSG and SOA obligations)




Thanks for this.

It is really helpful in determining what one should write. Lift your finger and one could be found in court saying "no sir, yes sir"...


----------



## Bronte (21 October 2005)

RichKid said:
			
		

> Bronte,
> I'm sure you mean well and even if I agree with your view we have to be careful to ensure any views are not considered to be financial advice. If by some chance the market bounces and people lose out on profits due to reliance on your view then there is the real chance of being blamed for 'bad advice'. This is just my understanding of ASIC's view and the general law.
> 
> I do agree that it is worth learning and reading and questioning all the time.




RichKid,
Just noticed your reply and others...
Point taken & I do mean well.


----------



## Bronte (21 October 2005)

mit said:
			
		

> Bronte,
> 
> It's October now. Are you saying you are bullish or bearish?
> 
> Mit




Sorry Mit,
Didnt see this either  

We are definately looking for bullish signals now.
The market usually makes Lows this time of year.
Late October / November


----------



## stocklearner (22 October 2005)

someone call it's the crash, but i see it's a chance. a market can't be always bullish. it need some rest for good reason. risk? opportunity? that's what the market makes us so exciting to addict to it. 
after release risks in october and november, all be good...  
i hold dls


----------



## stocklearner (23 October 2005)

All Ordinaries will test 4250 next week. good luck to everyone.


----------



## brerwallabi (23 October 2005)

Just found this in me emails
The All Ordinaries has formed a descending broadening wedge over the last two weeks: a rare pattern that normally resolves in the direction of the long-term trend (in this case up). Friday's long tail signals buying support above the first major support line (from the previous peak in the primary up-trend) at 4250/60. Attempts to enter at this point are inadvisable because of the high failure rate. Thomas Bulkowski (Encyclopedia of Chart Patterns) recommends waiting for a close above the upper trendline or a partial decline: a trough that is higher than the preceding trough.


----------



## brerwallabi (23 October 2005)

Whoops forgot chart


----------



## wavepicker (23 October 2005)

I do not study planets or alchemy, but I do study chart pattern, price, time movements as well as Elliott Waves.

By my wave counts the ASX200 has either completed or is in the progress of completing in the coming months a 5 wave advance since 1980. If this is the case, it will end a 25 year bull market. This is a supercycle peak that will send the index into a bear market lasting 7-10 years and possibly back to 2600 points. it may be a fast decline ie crash or a slow ratcheting decline. This no one knows. There are way too many bulls out there at present to have a persistant bull market in the ASX.


----------



## el_ninj0 (23 October 2005)

So doom and gloom is back on the agenda i see. 4250  is the support, if we see this broken, we've got 3000 as the next support level. Only time will tell, anything else that is said is merely speculation. I will be trading cautiously, and watching the DOW fairly closely, day traders control too much of the market in my opinion, they are the cause of much of the worry, and they are worried because the DOW is falling apart. An excellent analogy would be America having the most powerful army on earth, but having the monkey(bush) in charge.

Good luck, and good night.


----------



## wayneL (24 October 2005)

el_ninj0 said:
			
		

> ...day traders control too much of the market in my opinion, they are the cause of much of the worry, and they are worried because the DOW is falling apart....




A popular opinion.

But....a few points to consider about daytraders.

1/ They are a *VERY* small minority. Institutions and "investors" vastly outweigh daytraders in both number and amount of capital in the market.

I don't see how they can cause worry in any but the smallest cap stocks

2/ Daytraders aren't worried about direction, they trade whichever way it is going. Insto's and investors set the direction.

3/ Most daytraders would relish a decent bear. A good plunge can be very profitable...and, if it dumps enough, they will recognise TRUE bargains and buy some stock for the bottom drawer. ( What most people think is a bargain these days is still ludicrously overpriced)

These facts won't change the propensity for other players to blame daytraders for their market woes...anything, rather than recognise that value & price have become so out of whack for so long that a whole generation of investors have no idea what "value" means.

Please don't see this as an attack on you personally el ninj0. No doubt you are just repeating a popular (but incorrect) assertion.

Cheers


----------



## dombat (24 October 2005)

I am going on the record to say that by January the asx will be enjoying another bull run ... and it may come sooner than that....I can't believe how fickle and gloomy everybody is ... there are only three classes of assets shares property and bank bills... this is true in oz and true in usa...the american property market is overheated and their bank bills may go to 5% BUT their p/e is almost at historically low levels...so where do you think the money will go when the nervous nellies have been shaken out???  Sure oil price will be inflationary but the fact remains the funds are not going back into property and they are not going to go into bank bills (well not for long) ...no by January it will be business as usual  It is a time of opportunity....


----------



## wayneL (24 October 2005)

dombat said:
			
		

> BUT their p/e is almost at historically low levels.




You really think so? Looks to me like PE < 8 would be more like it.


----------



## dombat (24 October 2005)

and you think a pe of 5 to 7 is high??...Come on do you really think the funds are going to stay in bank bills for long with a p.e of 5 to 7?


----------



## wayneL (24 October 2005)

dombat said:
			
		

> and you think a pe of 5 to 7 is high??




No, that would be low. A time for investing.



			
				dombat said:
			
		

> ...Come on do you really think the funds are going to stay in bank bills for long with a p.e of 5 to 7?




I don't know. There are more variables to consider than bank bill rates. But at p/e 5 -7, they probably should be buying with their ears back.

But my suspicion is that at that point in the market, they will be more likely to experience outflows of funds, rather than inflows, forcing them to be sellers.

But I stress that I don't know what will happen.


----------



## dombat (24 October 2005)

Of course nobody knows what will happen  wish we did...howevever the very sound and basic propisition exists that funds must attempt to make a sound return and the housing market both here in the usa is stuffed so....back to mr sharemarket it will go...though i must say the hysteria yes the hysteria this october has truly been spectacular!  The price of oil is already receding, america must embark on a hugh building program with new orleans...no the one thing I am confident is that by January people will be looking back and wondering what this was all about...and another prediction BHP $25 by febuary - can't believe how people with a herd mentality act..BHP has been receiving huge prices for all of its product and china still is powering along...the gulf of mexico hardly made a dent in their bottom line...yes BHP will go to $25


----------



## wayneL (24 October 2005)

dombat said:
			
		

> Of course nobody knows what will happen  wish we did...howevever the very sound and basic propisition exists that funds must attempt to make a sound return and the housing market both here in the usa is stuffed so....back to mr sharemarket it will go...though i must say the hysteria yes the hysteria this october has truly been spectacular!  The price of oil is already receding, america must embark on a hugh building program with new orleans...no the one thing I am confident is that by January people will be looking back and wondering what this was all about...and another prediction BHP $25 by febuary - can't believe how people with a herd mentality act..BHP has been receiving huge prices for all of its product and china still is powering along...the gulf of mexico hardly made a dent in their bottom line...yes BHP will go to $25




Well you have to have a view, and back that view. All the best with it.

My view is that the likes of prechter will be proven right. But thats not to say your scenario won't happen first. This sort of current volatility could precipitate both outcomes.

cheers


----------



## wavepicker (24 October 2005)

dombat said:
			
		

> Of course nobody knows what will happen  wish we did...howevever the very sound and basic propisition exists that funds must attempt to make a sound return and the housing market both here in the usa is stuffed so....back to mr sharemarket it will go...though i must say the hysteria yes the hysteria this october has truly been spectacular!  The price of oil is already receding, america must embark on a hugh building program with new orleans...no the one thing I am confident is that by January people will be looking back and wondering what this was all about...and another prediction BHP $25 by febuary - can't believe how people with a herd mentality act..BHP has been receiving huge prices for all of its product and china still is powering along...the gulf of mexico hardly made a dent in their bottom line...yes BHP will go to $25




Yes what you say is true, my point earlier is that the ASX200 is the process of forming a peak, this may already be done or it may happen next year. When it does happen exactly know one knows yet, but the warning signs are there already. Like all previous major declines of history 90% of particpants will bet burnt because of greed and overstaying. Since October 04 the DJI has been forming a possible broadening head and shouders formation. If this does in fact work out, prices in the US in my opinon will not see a rally until the start of December, and will give way to 8500 next year at least. This makes sense because in such an event there will be a flight to cash, and people will choose US Dollars first. The US Dollar Index itself appears to beforming what is an inverted head and formation, although it appears it will have a pause in its uptrend the next few weeks. This in itself should show us that foreign currencies and commodoties prices will pullback from current levels.

If the US slips into recession  in the years ahead there will be a slackening in demand for resources and commodity prices as it is a big customer for Chinese goods


----------



## el_ninj0 (24 October 2005)

wavepicker said:
			
		

> If the US slips into recession  in the years ahead there will be a slackening in demand for resources and commodity prices as it is a big customer for Chinese goods




I disagree, there is huge demand from other places, such as India, Indonesia, and the Chinese themselves. Europe is a massive consumer of Chinese made textiles as well. So I think demand will still outway supply by a fair bit. India is yet to make its dent on the world markets in my opinion, and China has only just started.


----------



## Smurf1976 (24 October 2005)

I think we've seen a long term bottom in interest rates in the US. As rates there rise that ought to, within reasonable limits, move rates elsewhere too.

As for the stock market, a secular bear started in the US markets in 2000 IMO. The ASX isn't so clear...


----------



## DTM (24 October 2005)

el_ninj0 said:
			
		

> I disagree, there is huge demand from other places, such as India, Indonesia, and the Chinese themselves. Europe is a massive consumer of Chinese made textiles as well. So I think demand will still outway supply by a fair bit. India is yet to make its dent on the world markets in my opinion, and China has only just started.




If memory serves me correct, the US accounts for 1/3 of China's exports (don't quote me).  A huge part of the market.  Any slow down in the US would put an end to a lot of demand, especially when other economies like Europe follow.

 

That would then leave us with a lot of coal and iron, record indebtedness, and a falling dollar.

 :goodnight


----------



## Bronte (26 October 2005)

Bronte said:
			
		

> *We are definately looking for bullish signals now.*
> The market usually makes Lows this time of year.
> Late October / November



_Quote from 21st October 3.28PM_

Ganns Golden Rule 50% PB
This was a very good bullish signal.


----------



## amohonour (26 October 2005)

Good posts interesting reading but as has been said the rest of the world is not as affected by the US sneeze problem i think especially since the euro has been getting stronger still think it may well be the world currency one day just a thought.


----------



## It's Snake Pliskin (27 October 2005)

October is a dog of a month. 
Crashes don't happen anymore because we must feed China.


----------



## wayneL (27 October 2005)

Snake Pliskin said:
			
		

> Crashes don't happen anymore....




....until the next one.


----------



## It's Snake Pliskin (27 October 2005)

wayneL said:
			
		

> ....until the next one.




How true!


----------



## Hanrahan (27 October 2005)

DTM said:
			
		

> If memory serves me correct, the US accounts for 1/3 of China's exports (don't quote me).  A huge part of the market.  Any slow down in the US would put an end to a lot of demand, especially when other economies like Europe follow.
> 
> 
> 
> ...



Walmart's import bill from China is greater than many countries GDP. 

Without the US, China's growth would be very uncertain. They do have the option of ramping up domestic consumption but they would need to allow the Yuan to revalue to get their domestic prices reasonable for that to happen.

IMHO, of course.


----------



## happytrader (27 October 2005)

A long time ago back in Kiwi land, I did a stint working at a bar. And what a rough old Tavern it was too! Anyway quite often there would be violent outbursts, high emotions and a fight would usually ensue.  I would wonder why the bouncers would observe from a distance and not jump in immediately and stop the  'blueing', so I asked and was told, "We just wait until they're tired"  When that point was reached they would then calmly walk over and 'cleanup' so to speak. After all they were'nt  going to get themselves knocked around too badly by emotional and volatile people.

So you wonder what has that got to do with anything. Well I see a lot of this behaviour right here on the markets. A lot of people think with their heart or emotions and act that way. Then you've got the others who observe with their heads and $ signs just waiting for the hype and the emotion to die down and then step in and 'cleanup'

Cheers
Happytrader


----------



## Smurf1976 (27 October 2005)

A question for those with the necessary software...

When the ASX recently hit its all time high, what proportion of stocks (out of the ASX-200) were themselves at an all time high around that time?

I don't know the answer to this so it's not a "loaded" question to push either a bullish or bearish argument. But my thinking is that if the market is healthy then the recent strong rally ought to have had fairly broad support. If it was a narrowly based move to the all time high then that would be a bad sign IMO.

Anyone able to answer this?


----------



## TheAnalyst (27 October 2005)

The name of this thread should not be "The Crash of 05" it should be the "Claytons Crash of 05" the crash you have when you are not having a crash, just as claytons was the scotch you have when you are not having a scotch.


----------



## wayneL (27 October 2005)

The ambush waiting for Bernanke By Stephen S. Roach STEPHEN S. ROACH is the chief economist for Morgan Stanley.

October 26, 2005

MOST FED chairmen are blindsided early on in their tenure.

Alan Greenspan faced a stock market crash two months after he took over in August 1987. Paul Volcker had to cope with a rout in the bond market three months after he became chairman in August 1979. G. William Miller was challenged immediately by a dollar crisis in the spring of 1978. For Arthur Burns, it was the inflation bogie in the early 1970s.

What's more, this indoctrination by fire has tended to take the new Fed chief ”” who is arriving without his predecessor's hard-won credibility ”” well out of his comfort zone.

Burns, the business cycle expert, was ill-equipped to cope with inflation. Miller, the businessman, didn't understand financial markets. Volcker, the expert on international finance, had to deal with a major recession. And Greenspan, the business consultant, was thrust into crisis management.

Ben Bernanke, I suspect, will meet a similar fate. It's true that, on the surface, he seems to be the perfect candidate to deal with the one problem everyone is worried about today ”” inflation. The oil shock of 2005 has taken retail energy prices up 35% over the last year, and there are 1970s-style fears that a spillover to other prices can't be too far behind.

And Bernanke is widely thought to be the perfect central banker to cope with this problem. He is renowned for his skills as an inflation fighter. He has led the charge in the academic debate over "inflation targeting" ”” arguing that a central bank needs to be explicit in aligning its policy instrument (the federal funds rate) with a numerical target of price stability (a 1% to 2% increase in the "core" consumer price index).

But I suspect that the current inflation scare will turn out to be a false alarm. As always, energy prices will come down when demand sags ”” some of that may already be occurring ”” and the new and powerful forces of globalization should continue to hold other prices largely in check.

The U.S. economy actually faces far greater threats than inflation ”” threats that an inflation targeter such as Bernanke may be ill-equipped to deal with.

At the top of the list is a record U.S. current account deficit ”” the broadest measure of the nation's trade balance (imbalance, in this case) with the rest of the world. Running at an annual rate of close to $800 billion in the first half of 2005, it requires foreign funding to the tune of $3 billion per business day. To accomplish that without a sharp drop in the dollar and/or a related backup in interest rates requires extraordinary confidence on the part of foreign investors in U.S. assets.

The foreign confidence factor could well be Bernanke's biggest challenge when he takes the reins at the Fed. The nation's current account deficit averaged just -1.5% of gross domestic product at the three most recent Fed transition points ”” the ascendancy of Miller, Volcker and Greenspan.

By contrast, today's deficit is more than four times larger at -6.4%. Moreover, in the face of an energy shock and a post-Katrina fiscal spending binge, there is good reason to look for a further reduction in U.S. saving and a related widening of the current account deficit over the next year.

In short, the U.S. is going to be asking a lot more of the foreign investor at precisely the moment the Fed is transitioning from Greenspan to Bernanke. As the maestro leaves the building, the hard-won aura of foreign confidence that surrounds him could be quick to follow. Bernanke could be faced with a dollar crisis and the related need on the part of foreign investors to seek compensation for taking currency risk. That compensation invariably spells higher interest rates ”” the last thing the nation's housing bubble and overly indebted consumers need.

During the Greenspan era, the U.S. economy pushed the envelope in sustaining an increasingly dangerous strain of unbalanced growth. In doing so, it experienced an equity bubble, a housing bubble, a record current account deficit and a monstrous overhang of household debt. The U.S. has gotten away with these imbalances because of the "kindness of strangers" ”” the willingness of foreigners to keep investing in dollar-based assets.

But the confidence that underpins foreign funding of the U.S. is a very fragile commodity. Fed transition time usually unmasks that fragility. Like the chairmen who preceded him, Bernanke could quickly find himself dealing with a confidence crisis. And suddenly, the inflation targeter will be staring at a far more intractable set of problems than his research and training prepared him for.

History warns us to expect the unexpected when the nation's second-toughest job changes hands.


----------



## wavepicker (28 October 2005)

TheAnalyst said:
			
		

> If investors have listened to the advice of the Financial Planning association and its skilled and qualified members they would be diversified and not worried about a crash or any of the events of the last 2 weeks.





The average financial planner sends you from one disaster to another. In february of 2002 the average financial planner was super bullish the ASX200. The results: A 23% loss for their clients in the stock market for the next 2 years.

There are WAY too many bulls in this market at present, that is not what bull markets are built on


----------



## happytrader (28 October 2005)

wavepicker said:
			
		

> The average financial planner sends you from one disaster to another. In february of 2002 the average financial planner was super bullish the ASX200. The results: A 23% loss for their clients in the stock market for the next 2 years.
> 
> There are WAY too many bulls in this market at present, that is not what bull markets are built on




Hi Wavepicker

I agree with your comment about the average financial planner. As in everything in life you only get what you pay for. There above average performers with the results, take some searching for but are heads and shoulders above everyone else and are worth every dollar. 

Cheers

Happytrader


----------



## el_ninj0 (28 October 2005)

Could See 4300 or below today. US market down 115 points at close. Anyone got some news on why it fell?

We are in for another gloomy day on the market today i think.


----------



## TheAnalyst (28 October 2005)

wavepicker said:
			
		

> The average financial planner sends you from one disaster to another. In february of 2002 the average financial planner was super bullish the ASX200. The results: A 23% loss for their clients in the stock market for the next 2 years.
> 
> There are WAY too many bulls in this market at present, that is not what bull markets are built on




Tell that to the planners at Westpac who put their clients money into a balanced fund and their clients will tell you the opposite to what you are quoting.


----------



## chansw (28 October 2005)

el_ninj0 said:
			
		

> Could See 4300 or below today. US market down 115 points at close. Anyone got some news on why it fell?
> 
> We are in for another gloomy day on the market today i think.



Dow Sheds 115, Nasdaq Loses 36 After Durable Goods Orders Slip, Raising Economic Questions


----------



## tech/a (28 October 2005)

wavepicker said:
			
		

> The average financial planner sends you from one disaster to another. In february of 2002 the average financial planner was super bullish the ASX200. The results: A 23% loss for their clients in the stock market for the next 2 years.
> 
> There are WAY too many bulls in this market at present, that is not what bull markets are built on




The average Financial Planner is not what he appears.
He is simply a Superannuation Salesman under the umbrella of his authorities licience.
He has limited authority and as such limited "Planning" capability.

I have 3 friends who are "Planners" and invested a couple of K in 2 seperate evaluations (from independant "Planners"). To look at my own situation from their veiw and recommend direction/s.
There was nothing out of the square.
One advised $52,000 a year into super  Their 5 yr return 7% my own return way way over that infact most here would be way over 7%---so  

Anyway my veiw is that if you dont take control of your own financial future no one else will.


----------



## happytrader (28 October 2005)

Who's ready for a put play today?


----------



## happytrader (29 October 2005)

Hi everyone

Wanted to share some of the great video interviews with Market Wizard Linda Bradford Raschke. They can be accessed free at her website www.lbrgroup.com. Some of them were from the bear market in 2002. 

I remember Renee Rifkin saying something along the lines that 'when taxi drivers start giving you tips its time to get out'

When Linda was asked by a cash hog if he should now start buying stocks (2002) 'she says .....'wait till your next door neighbour is totally depressed and feels like the market will never rally again that might be your cue'

Hope you enjoy them.

Cheers 
Happytrader


----------



## mit (31 October 2005)

happytrader said:
			
		

> Hi everyone
> 
> Wanted to share some of the great video interviews with Market Wizard Linda Bradford Raschke. They can be accessed free at her website www.lbrgroup.com. Some of them were from the bear market in 2002.




Hi Happytrader,

Where is it on her site. Finding lots of other interesting things though.

MIT


----------



## wavepicker (31 October 2005)

TheAnalyst said:
			
		

> Tell that to the planners at Westpac who put their clients money into a balanced fund and their clients will tell you the opposite to what you are quoting.




That's great for the planners at Westpac,  they are probably advising the same thing right now.  Try averaging out the returns of those balanced funds for the last 5 years and again for the next 5 years and those balance sheets may not look so flash. That's because planners  like most people like keeping to the status quo. 

If 90% of planners or anyone for the matter was very bullish or bearish then to me that shows complacency on their part,  and is a sign that a particular trend is at risk of ending.


----------



## happytrader (31 October 2005)

mit said:
			
		

> Hi Happytrader,
> 
> Where is it on her site. Finding lots of other interesting things though.
> 
> MIT



 Hi Mit 

Look down the left hand side of her home page close to the bottom 

Its inbetween the Street Smarts ad and above Proton trader ad. It says Linda's Interviews. Enjoy

Cheers
Happytrader


----------



## TheAnalyst (2 November 2005)

wavepicker said:
			
		

> That's great for the planners at Westpac,  they are probably advising the same thing right now.  Try averaging out the returns of those balanced funds for the last 5 years and again for the next 5 years and those balance sheets may not look so flash. That's because planners  like most people like keeping to the status quo.
> 
> If 90% of planners or anyone for the matter was very bullish or bearish then to me that shows complacency on their part,  and is a sign that a particular trend is at risk of ending.




Yer, you are correct there! Do you know what the actual return is for a ten year and a five year average for a balanced portfolio? I do.


----------



## wavepicker (2 November 2005)

To be honest with you I don't really care, returns will dimish in the coming months as selling pressure increases. I just know that the returns are insignificant compared to what I have been able to acheive in both bull and bear markets


----------



## TheAnalyst (2 November 2005)

wavepicker said:
			
		

> To be honest with you I don't really care, returns will dimish in the coming months as selling pressure increases. I just know that the returns are insignificant compared to what I have been able to acheive in both bull and bear markets




Because u dont know, thats what i reckon and your last comment isnt fact its an assumption. Actually can you tell me the asset allocation of a balanced portfolio? And if you dont care why make comments?


----------



## wavepicker (3 November 2005)

What i do know is the average return of average fund last 5 to 10 years, and if Westpacs is marginally higher than that, well good on you!! Just because you can make a few $$ in an bull market when 80% of stoxx are rising anyway( something a 10 year old kid could do). This should make you guys real special and proud.

The industry asset allocation levels at present are our biggest clue the market is a peak. You guys make the best contrarian buy or sell signals 

Lets see how well you guys do in a sodewyas or eevn a bear market huh? What will recommend then? Buy Westpac?


----------



## TheAnalyst (3 November 2005)

wavepicker said:
			
		

> What i do know is the average return of average fund last 5 to 10 years, and if Westpacs is marginally higher than that, well good on you!! Just because you can make a few $$ in an bull market when 80% of stoxx are rising anyway( something a 10 year old kid could do). This should make you guys real special and proud.
> 
> The industry asset allocation levels at present are our biggest clue the market is a peak. You guys make the best contrarian buy or sell signals
> 
> Lets see how well you guys do in a sodewyas or eevn a bear market huh? What will recommend then? Buy Westpac?




Wow! you know about Westpac? We just spent one year getting paid to work that out and you did'nt.


----------



## wavepicker (3 November 2005)

That's right I forget, you call yourself the TheAnalyst. You get paid to anal-yse.


----------



## wayneL (3 November 2005)

Lets keep it on topic guys, we're not far away from deleting some posts here.

Cheers


----------



## johnno261 (3 November 2005)

*Re: The Crash of 06*

second quarter 06.Lets not turn this into a guessing game when the next crash will occur, but the above is my opinion.A couple of months after the new appointed Bernanke!!!!


----------



## wayneL (4 November 2005)

*Re: The Crash of 06*



			
				johnno261 said:
			
		

> second quarter 06.Lets not turn this into a guessing game when the next crash will occur, but the above is my opinion.A couple of months after the new appointed Bernanke!!!!





johnno,

Well your view is certainly not without precedent...2nd 1/4 2006 it is.


----------



## TheAnalyst (4 November 2005)

wavepicker said:
			
		

> That's right I forget, you call yourself the TheAnalyst. You get paid to anal-yse.




Thats a very harsh remark; I aint gonna go that low, perhaps you need to realise that you get a bit to upset easy.

xxoo


----------



## TjamesX (7 November 2005)

*Re: The Crash of 06*



			
				wayneL said:
			
		

> johnno,
> 
> Well your view is certainly not without precedent...2nd 1/4 2006 it is.




And the headline for the latest issue of aireview is "Abandon all hope, the crash is coming"

http://www.aireview.com/welcome.php

The article mainly goes though Elliot wave analysis, particularly Precter.... WayneL you follow this sort of stuff - the article may be worth a read.

I'm trying to learn up on Exchange traded options - mainly puts (seriously!  : )


----------



## chicken (7 November 2005)

*Re: The Crash of 06*



			
				TjamesX said:
			
		

> And the headline for the latest issue of aireview is "Abandon all hope, the crash is coming"
> 
> http://www.aireview.com/welcome.php
> 
> ...



CRAP....they been saying that to short the market for the last 30 years...you sell they buy.....Gold will go through $500....and dont listen to the brokers...stick to what you know with todays technology....Crash of 2005 CRAP thats what I say its like the realestate market...you pay for what you get..BANKS win you lose....I am long in the market as look at Burns Philp...you could have bought at 3cents this stock....its pure manipulation and decide what is real and what is not thats the way you profit....ZFX is an example...STOCK CRASH....correction yes...depression no...just manipulation by the BIG BOYS....


----------



## Smurf1976 (7 November 2005)

*Re: The Crash of 06*



			
				chicken said:
			
		

> ...decide what is real and what is not thats the way you profit...



Agreed there. There's always some vested interest trying to convince people that a P/E of 28 is normal, that it's normal to pay 12 times your annual earnings for a house and that there is plenty of oil which can be produced at $30 a barrel. None of which, in my opinion, is true and therein lies potential for profit.


----------



## wayneL (8 November 2005)

*Re: The Crash of 06*



			
				Smurf1976 said:
			
		

> Agreed there. There's always some vested interest trying to convince people that a P/E of 28 is normal, that it's normal to pay 12 times your annual earnings for a house and that there is plenty of oil which can be produced at $30 a barrel. None of which, in my opinion, is true and therein lies potential for profit.




Hehehehe, right on there.

Tjames,

been away a fews days, thanks for the article, will give it a read 

Cheers


----------



## wayneL (8 November 2005)

More grist for the mill.....
*
Britons going bust: total soars by 46% in a year*

· Experts blame easy credit and 'want now' consumers
· Government accused of allowing £1trillion debts

Ashley Seager, Laura Smith, Larry Elliott
Saturday November 5, 2005
The Guardian

The number of people filing for insolvency in Britain rose by almost 50% to new record levels over the past year as consumers struggled to cope with the debts amassed in recent years, according to government figures released yesterday.

http://www.guardian.co.uk/business/story/0,3604,1635079,00.html

and...

Memo to consumer: Why have you curbed spending?
Wall Street says it needs you to keep the economy afloat

Ellen Simon
AP Business Writer
November 5, 2005
NEW YORK - Wall Street is worried about you. Yes, you. The one they call "The Consumer."

Yes, you. The one they call "The Consumer." From the trophy-arrayed corner office of the richest CEO to the windowless cubicle of the most junior analyst, your immediate future is a pressing concern. What will you get for Christmas? How much will it cost to heat your house this winter? Will you get a raise next year?

http://www.desertsunonline.com/apps/pbcs.dll/article?AID=/20051105/BUSINESS06/511050321/1003


----------



## wayneL (8 November 2005)

*Re: The Crash of 06*



			
				chicken said:
			
		

> CRAP....they been saying that to short the market for the last 30 years...you sell they buy.....Gold will go through $500....and dont listen to the brokers...stick to what you know with todays technology....Crash of 2005 CRAP thats what I say its like the realestate market...you pay for what you get..BANKS win you lose....I am long in the market as look at Burns Philp...you could have bought at 3cents this stock....its pure manipulation and decide what is real and what is not thats the way you profit....ZFX is an example...STOCK CRASH....correction yes...depression no...just manipulation by the BIG BOYS....




Chicken,

I invite you to expand your time horizon.

Could the world economy fall over after such a stellar run? Sure it can!

I knew a bloke who had a business the same as mine years ago.

Sales were booming, he spent 30k on his office (when that was a &^%$ing lot of money for an office) and bought a brand new Porche 911.......

......4 months later he went broke for a $2.5 million.

Another fellow in the same industry had his salesmen running around in merc 380's...had the flash factory/showroom...was well up in the industry association...status plus.

Guess what? Yup! Went down for $6.5 mil

All is not always at it seems.

Cheers


----------



## chicken (8 November 2005)

*Re: The Crash of 06*



			
				wayneL said:
			
		

> Chicken,
> 
> I invite you to expand your time horizon.
> 
> ...



Waynel...I think you follow the rule you cant go broke shorting the market...


----------



## happytrader (8 November 2005)

I've just had a brainwave!

Does two corrections in a year mean we've got the equivalent of a double bottom in strength and direction?

Just thinking outside the square.

Cheers
Happytrader


----------



## TheAnalyst (11 November 2005)

Hey! Are we still in the crash? Or is it over for now?


----------



## wavepicker (11 November 2005)

*Re: The Crash of 06*



			
				chicken said:
			
		

> CRAP....they been saying that to short the market for the last 30 years...you sell they buy.....Gold will go through $500....and dont listen to the brokers...stick to what you know with todays technology....Crash of 2005 CRAP thats what I say its like the realestate market...you pay for what you get..BANKS win you lose....I am long in the market as look at Burns Philp...you could have bought at 3cents this stock....its pure manipulation and decide what is real and what is not thats the way you profit....ZFX is an example...STOCK CRASH....correction yes...depression no...just manipulation by the BIG BOYS....




Chiken, 

It all depends as what you define as a correction and a crash. There are crashes that happen in 2-5 days such as the crashes of 29 and 87. Then there is a slow ratchetting bear market that can last for years, which can also be defined as a crash(bear market of the 1970's). Technically speaking however, a crash is defined as a decline in prices of 15% or greater.

It seems to me that certain bulls who permeate these forums who will not be named (they know who they are), some of whom have a professional financial status(although one wonders who on earth gave them the license to give financial advice)  They think the share market, property market , etc have only has one direction.-UP 

These people have either not been trading for long or have very short memories(It was just 2 years ago we finished a 23% crash in the ASX). In my opinion, the best of the gains of this market are well and truly over. Retail investors who are over invested  and Instos that have high asset allocations toward the market are at best chasing a probable 5% gain and risking 25% fall. I thought the market was about buying low and selling high; or is it perhaps , buy high and selling a little higher Or selling lower? Where is the value in this market now?

In so far as Robert Prechter goes, in my opinion the man is one of the best technical analysts and financial authors on the face of this planet. Back in 1978 while the DJIA and most of the other world markets had been in a bear market for 10 years, he was a lone bull on Wall st. He predicted the biggest bull market in history was about to start(when 90% of Analysts were bearish. He then predicted the crash of 87 within a week of it taking place. Sure he has not been 100% recently(and who ever is consistantly accurate anyway!!). But you forget he is also correct because the DJIA is still in the bear market that started in December of 2000. The only difference is that the down trend will pick up speed next year. 

It's not a matter of IF the market will CRASH, CORRECT > 15%, HAVE LONG BEAR MARKET, but when. All you have to do is look behind you, because when it does come it will not be correcting the gains we have had the last 2 years,5 years or even 10 years, rather it will be correcting the gains that have been made since 1982, which will make it a 7-10 year bear market when it finally does start. And 90% of people (that includes professionals) will stay invested during that period, and the other 10% will make $$ at their expense.


----------



## TheAnalyst (13 November 2005)

*Re: The Crash of 06*



			
				wavepicker said:
			
		

> Chiken,
> 
> It all depends as what you define as a correction and a crash. There are crashes that happen in 2-5 days such as the crashes of 29 and 87. Then there is a slow ratchetting bear market that can last for years, which can also be defined as a crash(bear market of the 1970's). Technically speaking however, a crash is defined as a decline in prices of 15% or greater.
> 
> ...




What economic event do you think will trigger this event? Or do you think it could be a range of events that will trigger this event?

If interest rates were to go up a lot and suddenly and then remain this would of course cause share prices to decrease until they actually produced a yield that was above the short term and long term interest rate on just straight cash in the bank or term deposites and bonds. As investors would jump into these investments to stop the devaluing impact of inflation on their capital, so they would quickly sell shares to beat a decrease in capital. On top of this higher interest rates would stifle or hider micro business economic growth and of course company earnings.

This would be a bear market at present as international borders for investors decrease and dereualation for companies to operate in other countries that they would not normally have been able to in past times helps off set this type of effect. 

What we must look at is what would cause high inflation and therefore a higher interest rate that would have a decreasing effect on equity markets e.g. energy costs, other recourse costs

We can say we will have a bear market but why has it been deferred for a while or is it just that the U.S. markets have been marking time and have not been in depression. Also the world and especially Western countries like Australia have learnt and placed mechanisms in place that allow its central banks to respond and warn about economic dangers a lot faster than in previouse times as I believe this has also helped deffer bear markets and also investor eduacation has also helped where as the average investor today is more aware of how the markets operate and what signds to be weary of before buying and seling equities as has not been the case of times past.


----------



## Smurf1976 (13 November 2005)

*Re: The Crash of 06*



			
				TheAnalyst said:
			
		

> What economic event do you think will trigger this event? Or do you think it could be a range of events that will trigger this event?



Four things come immediately to mind.

1. The real estate bubble which is now deflating slowly in some parts of the world (Sydney, Hobart, UK, anecdotal reports from the US) and crashing in parts of New Zealand (appartment prices in Auckland are reported to be down in the order of 35% and still falling).

2. The very high level of consumer debt. In the absence of rapid wage growth and with the ending of the real estate boom I doubt very much that consumers will be willing to continue taking on more debt. They may even start paying it back. The IR reforms may add to a feeling of unease over high debt levels. Will some sell stocks in order to repay debt?

3. Worldwide oil production is maxed out. 

4. The US seems rather determined to defend their currency after the plunge of the past few years. Given the near-crisis nature of the falls a year ago I think that they have either decided themselves to defend the Dollar at all costs or, more likely, been told by the IMF and other central banks etc. If that's correct then we could see US interest rates going far higher than is commonly expected.

All just my opinion and not advice etc.


----------



## wayneL (13 November 2005)

What economic event caused the '29 crash? ...the '87 crash?



> The crash followed an alleged speculative boom that had taken hold in the late 1920s, which had led millions of Americans to invest heavily in the stock market.
> 
> This investment drove share prices up to artificially high levels; the rising share prices encouraged more people to invest, as they hoped the shares would rise further, thus fueling further rises, and creating an economic bubble. The banks lent heavily to fund this share-buying spree. On October 24, 1929 (with the Dow Jones Industrial Average market index just off its peak from September 3rd at 381.17), the bubble finally burst and panic selling set in. Thirteen million shares were sold in the space of one day, as people desperately tried to dispose of their shares before they became worthless.
> 
> ...




I don't know about you all, but I see a pattern


----------



## happytrader (13 November 2005)

Whatever way the market moves just make sure you're moving with it.

Cheers
Happytrader


----------



## TheAnalyst (13 November 2005)

wayneL said:
			
		

> What economic event caused the '29 crash? ...the '87 crash?
> 
> 
> 
> I don't know about you all, but I see a pattern




Which stocks in the ASX do you see as overvalued and above fundamental stock pricing?

And if so, where is the heavy debt issue? Shares or property


----------



## wavepicker (13 November 2005)

*Re: The Crash of 06*



			
				TheAnalyst said:
			
		

> What economic event do you think will trigger this event? Or do you think it could be a range of events that will trigger this event?
> 
> If interest rates were to go up a lot and suddenly and then remain this would of course cause share prices to decrease until they actually produced a yield that was above the short term and long term interest rate on just straight cash in the bank or term deposites and bonds. As investors would jump into these investments to stop the devaluing impact of inflation on their capital, so they would quickly sell shares to beat a decrease in capital. On top of this higher interest rates would stifle or hider micro business economic growth and of course company earnings.
> 
> ...




Analyst,

Personally I don't think any event will trigger a change in trend. If it's going to happen, it's gonna happen anyway!! When it does happen the trend change will be both mechanical and psychological. After all the uptrend is psychological why not the downtrend. It's quite strange, in the evening news we see financial journalists trying to justify what the market did that day. In many cases the market would have probably moved the way it did anyway. 
Now just imagine I had a crystal ball and could foretell the direction of oil, interest rates, our deficit, geopolotical events, you name it; for say the next 2 years. If I gave you that information, then you or anyone else, probably would still not be able to come up with a logical conclusion as to what the market will do or where to put your money . There have been instances in history when the news has caused the market to be both up a lot or down a lot. If you overlayed a long term historical chart of oil, interest rates,the defecit etc over a stock chart, you will quickly see these  have absolutely no correlation with the stock market( maybe over the shorterm ok)
One has to understand that the what causes the market to move is  both internal and dynamic. 
At the end of the day what it reaaly boils down to is to decide  which way the market is trending, to stay with that trend (either up or down) for as long as possible, and lastly to determine ways of telling us when that trend is at risk of changing. That is reality and what the market is doing. Personally I think the market is a leading indicator of the economy, not the other way around.  

In so far as central banks and the like being able to repond more efficiently to economic changes, well that may be true. But they cannot alter the direction of the market or predict the stock market. All you have to do is look at 500 years of stock charts and it is plainly obvious they all look similiar. They have always ended in bust at some point. This tells us one thing, that human nature has not changed, and that people are people so that emotional hope, fear,and greed is what drives the markets, and these traits have and never will change in the  human physiological makeup.. People will make the same mistakes today as there forefathers did.


----------



## johnno261 (13 November 2005)

wayneL said:
			
		

> What economic event caused the '29 crash? ...the '87 crash?
> 
> 
> 
> I don't know about you all, but I see a pattern




Reinforce your SCARY pattern WayneL and feel us in with whats going on!!


----------



## TheAnalyst (13 November 2005)

*Re: The Crash of 06*



			
				wavepicker said:
			
		

> Analyst,
> 
> Personally I don't think any event will trigger a change in trend. If it's going to happen, it's gonna happen anyway!! When it does happen the trend change will be both mechanical and psychological. After all the uptrend is psychological why not the downtrend. It's quite strange, in the evening news we see financial journalists trying to justify what the market did that day. In many cases the market would have probably moved the way it did anyway.
> Now just imagine I had a crystal ball and could foretell the direction of oil, interest rates, our deficit, geopolotical events, you name it; for say the next 2 years. If I gave you that information, then you or anyone else, probably would still not be able to come up with a logical conclusion as to what the market will do or where to put your money . There have been instances in history when the news has caused the market to be both up a lot or down a lot. If you overlayed a long term historical chart of oil, interest rates,the defecit etc over a stock chart, you will quickly see these  have absolutely no correlation with the stock market( maybe over the shorterm ok)
> ...




Hi Johhno

The "29" and "87" crashes were all triggered by certian events and because certian investors did not have in place risk management processes for sharemarket investing and borrowing risk scenarios the market falls became compounded.

A person who invests in the stockmarket therefore must say in a worst scenario what can I accept in terms of volitility and can i cope with what may happen?

Is the ASX overpriced is what I ask and if so which individual stocks are over priced?

Refer to the dot com crash and look at why it crashed? P/E and P/E


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## johnno261 (13 November 2005)

*Re: The Crash of 06*



			
				TheAnalyst said:
			
		

> Hi Johhno
> 
> The "29" and "87" crashes were all triggered by certian events and because certian investors did not have in place risk management prrocesses for sharemarket investing and borrowing risk scenarios the market falls became compounded.
> 
> ...




To ask the question, "is the ASX overvalued?", is like asking are there too many stars in the sky? I have heavy investments in the ASX therefore I think not as yet !!!!! Even if it was very undervalued and the DJIA fell, are you saying we would be safe?


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## TheAnalyst (13 November 2005)

*Re: The Crash of 06*



			
				johnno261 said:
			
		

> To ask the question, "is the ASX overvalued?", is like asking are there too many stars in the sky? I have heavy investments in the ASX therefore I think not as yet !!!!! Even if it was very undervalued and the DJIA fell, are you saying we would be safe?




By being over weight in undervalued stocks would offer some form of insurance and then you have to look at the economic climate and say which areas are doing extremly well at the moment such as rescource stocks and then ask the question what would cause these to fall?

At the moment i only have $1500 in the market and that is in equity call warrants and maybe by Wednesday I will add another $1500 into some other equity call warrants. Which ones do you think I may be looking at?


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## johnno261 (13 November 2005)

*Re: The Crash of 06*



			
				TheAnalyst said:
			
		

> By being over weight in undervalued stocks would offer some form of insurance and then you have to look at the economic climate and say which areas are doing extremly well at the moment such as rescource stocks and then ask the question what would cause these to fall?
> 
> At the moment i only have $1500 in the market and that is in equity call warrants and maybe by Wednesday I will add another $1500 into some other equity call warrants. Which ones do you think I may be looking at?



..........?


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## TheAnalyst (13 November 2005)

*Re: The Crash of 06*



			
				johnno261 said:
			
		

> ..........?




The price of iron ore is historically very high at the moment and is getting sensitive to affordability and the cost of fuel. It actually is so highly priced that the actual steel producers and processors are complaining to the suppliers because it is effecting their margins and there is a build up of steel stockpiles putting more pressure on demand.

Actually this is one of the reasons for the drop in bluescope steels share price of late and warranted a profit down grade from the company its self they actualy have the great oppurtunity to improve their profits from a decrease of the iron ore price and are putting pressure on suppliers to reduce it. There share price dropped below what it should be worth even with the profit downgrade. Bluescope steel equity call warrants and installment warrants are readily available but not MGX.


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## happytrader (13 November 2005)

As I recall prior to the 87 crash fantastic gains were made. Many stocks had doubled in less than a year. There was ample time and opportunity to start taking some money off the table. Realistic people did just that. Lots of us got caught but I mean we really couldn't complain too much because we'd pocketed some fantastic realitively quick profits. After the crash I could'nt believe the cheap luxury cars and properties. Then to top that off building societies and banks were offering 17% per annum to borrow your cash. After that it was a great time to jump back into the market. I saw first hand how with a crash or crises came the opportunity to redeem yourself. To remain caught up in the emotion with your focus on the hurt and loss you would not have seen your redemption. In the crash of 87 no one I knew could reach their broker. In this day of online trading I reckon it will be really interesting to see how it is all played out.

Cheers
Happytrader


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## Smurf1976 (13 November 2005)

The way I see it, when the general public becomes heavily involved in any market then that is a warning sign. And amber light.

When banks start lending heavily to the public in order that the public may increase their already high investment in a particular asset class then to me that screams "bubble". A red light.

And the final confirmation comes when discussion about this particular asset class / market becomes a mainstream topic of social conversation. When it becomes socially acceptable to boast that you bought in at the right time and have made a fortune simply because most of those around you are likewise in the same market. (So there's not many left to buy - game over for the market.) When learning about or pondering the market becomes regarded as a form of leisure or entertainment rather than a serious business. This is the red light complete with sirens, flags and flashing neon sign.

I'll leave it to you to guess which market I have in mind right now but it shouldn't be hard to work out. 

(All the above is my opinion only and not advice. I could be wrong.)


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## Smurf1976 (13 November 2005)

happytrader said:
			
		

> In the crash of 87 no one I knew could reach their broker. In this day of online trading I reckon it will be really interesting to see how it is all played out.



I think that if we get a 1929 / 1987 style crash then you won't even be able to get to the first page of your broker's website except perhaps at 3am the following morning. As for placing an order when the market is open - forget it IMO.

The reason for saying this is that I would expect the broker's websites have reasonably limited capacity that is adequate for the normally busy days with only a modest margin above that. A crash would simply swamp their capacity.

It's much the same with other systems. For example, electricity, phones, internet service providers, gas, water, traffic all work on the principle that not all potential users will actually make maximum use of the service at the same time. We won't all have the oven and clothes dryer running and be doing some welding at the same time and we won't all pick up the phone at once. If it did happen then these systems simply can not cope and the best case is that some customers still have supply. Worst case is the whole thing collapses. I very much expect that brokers would be in exactly the same situation and, if anything, are less robust than most of these systems.

Just look what happens when the airlines announce cheap fares. With a bit of luck you might be able to book at 3am but realistically both phones and internet are swamped by demand. Pure luck if you get straight through.

In my opinion the defining feature of any crash is that it is just not possible for most people to get out of the market. They can't get through to brokers etc. and even if they could market liquidity has dried up anyway so at best they'll be selling very cheaply.


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## el_ninj0 (13 November 2005)

Smurf1976 said:
			
		

> It's much the same with other systems. For example, electricity, phones, internet service providers, gas, water, traffic all work on the principle that not all potential users will actually make maximum use of the service at the same time. We won't all have the oven and clothes dryer running and be doing some welding at the same time and we won't all pick up the phone at once. If it did happen then these systems simply can not cope and the best case is that some customers still have supply. Worst case is the whole thing collapses. I very much expect that brokers would be in exactly the same situation and, if anything, are less robust than most of these systems.




You are on the right track there Smurt, and im sure for the first 30 mins or so, that would be the case. But as someone with indepth knowledge of how isp's and web servers work, i know that the problem would be resolved within a matter of hours at most. I have no doubt the entire system would crash to begin with, to get technical, a Denial of Service(DoS) attack is what it would be called.

But major brokerage firms such as comsec, nab, westpac would have virtually unlimited capacity through fiber cables that they could light up at any time they wish, as would the ASX. Plus they also have redundancy in their systems, otherwise their IT crews would be shot.


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## wayneL (14 November 2005)

Smurf1976 said:
			
		

> I'll leave it to you to guess which market I have in mind right now but it shouldn't be hard to work out.




Some headlines from my friend at: http://www.moneyfiles.org/temp.html



> ALL ROADS LEAD DOWN
> 
> ohh and by the way, Fannie Mae disclosed new accounting errors and confirmed it will have to restate earnings by some $11 billion. Its shares fell more than 2%. Did you know that Canadian housing starts fall 10% ? Strange isnt it? Now talking of education, after reading the artcile below, I am sure you will have understood that **higher education is a scam sold to the American public**. why are tutions going up? Because colleges and schools know that people will get a loans easily to pay their studies. So, how easy to raise tuitions yearly and endlessly. Yet today people find normal to pay so much for them. They are unwillingly participating in the debt-ponzi-orgy scheme and of course will be soon left holding the bag.
> 
> ...


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## TheAnalyst (22 January 2006)

Anyone got an opinion if there will be a crash tommorrow?

Would like to see a bit of input here


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## Jay-684 (22 January 2006)

TheAnalyst said:
			
		

> Anyone got an opinion if there will be a crash tommorrow?
> 
> Would like to see a bit of input here




papers are predicting a drop of 50 points, but still a relatively positive outlook from what I've read.

tomorrow could be a buying opportunity IMO


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## wayneL (22 January 2006)

TheAnalyst said:
			
		

> Anyone got an opinion if there will be a crash tommorrow?
> 
> Would like to see a bit of input here




The ASX won't crash without the US crashing first...and we're a long way off that.

There is some expectation that the PPT will step in next week to prop up the market if the silly dip buyers don't do so.

Some pass off the PPT as a myth, but its fair dinkum as this article proves:

http://www.jasmts.com/library.php?page=protection


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## johnno261 (22 January 2006)

There is nothing important about tomorrow! If the ASX pullsback and corrects, well fantastic! Those here would agree a slight correction is iminent.Tuesday morning in my opinion is far more important than tomorrow.By then we will have an indication of the movement on the DJIA.
As for a crash, I doubt it short term. Who knows.If somebody clearly knew the outcome, well we'd all go short and become instant millionaires again!!


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## nizar (22 January 2006)

does any1 remember if it was sumthing in the US that caused a correction in asx200 in october 05??


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## mit (22 January 2006)

Only thing that worries me is that the US market was still trending very strongly down at the close. This could me that the US on Monday will be very weak as well and the Aussie market could pre-empt this by having a bigger drop (>70) on Monday.

I think the oil futures tomorrow will be the key.

MIT


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## TheAnalyst (22 January 2006)

Nothing really worries me because my stocks very rarly go down once i buy them and i have mgx so i definitely have nothing to worry about.


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## clowboy (22 January 2006)

i wish the market would just crash already and be done with it


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## TheAnalyst (22 January 2006)

clowboy said:
			
		

> i wish the market would just crash already and be done with it




Same here...i can think of a number of installment warrants that i would love to accumualate on this scenario


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## Smurf1976 (22 January 2006)

I didn't keep the link unfortunately but I read somewhere that Iran was moving ALL it's reserves out of Western banks and assets in anticipation that they would be frozen in the event of war. That would be quite a lot of money coming out of the markets I assume.


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## michael_selway (22 January 2006)

nizar said:
			
		

> does any1 remember if it was sumthing in the US that caused a correction in asx200 in october 05??




Yes dude

Oild prices hit 70+ a barrel

and US quarterly reports of belwo forecasts, however near the end of OCt05 oil prices improved and soem improved employment and spending reports


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## wayneL (22 January 2006)

clowboy said:
			
		

> i wish the market would just crash already and be done with it




I couldn't agree more strongly.

Then I could become a bull again  

Alas, political careers hinge on endless bull markets, hence the PPT.


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## Smurf1976 (22 January 2006)

michael_selway said:
			
		

> however near the end of OCt05 oil prices improved and soem improved employment and spending reports



I'm not having a go at your post or you personally here   

Oil prices improved, as in they went DOWN
House prices improved, as in they went UP (I know you didn't mention houses, but real estate agents always use the word "improved").

Whether either of these things are an improvement or not depends on which side of the trade you are on. I doubt the oil exporting countries see falling prices as an improvement. Likewise I doubt those buying their first home or trading "up the ladder" see rising house prices as an improvement. Of course the oil importers and existing property owners / downsizers will be on the other side. 

Just an observation about the language used in the markets. It all depends on what benefits the person / organisation making the comment from what I can tell. As I said, just using your post to make the point and not having a go at it or you.


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## michael_selway (23 January 2006)

Smurf1976 said:
			
		

> I'm not having a go at your post or you personally here
> 
> Oil prices improved, as in they went DOWN
> House prices improved, as in they went UP (I know you didn't mention houses, but real estate agents always use the word "improved").
> ...




Hi yep thats what i meant 

Oil prices improved, as in they went DOWN. Lower oil prices means improvement for the economy. However oil stocks may suffer, but below to the contrary it appears!

Date: 18/1/2006 
Author: Robert Guy; Yvonne Ball 
Source: The Australian Financial Review --- Page: 13 
Woodside Petroleum is concerned that the spike in the crude oil price could threaten the global economy. CEO Don Voelte says high oil prices could have an adverse effect on global economic growth, and he would prefer the oil price to fall to around $US40 to $US45 a barrel in order to prevent a decline in the world economy. The oil price was trading at around $US65 a barrel on 17 January 2006. Although Woodside's earnings are boosted by a rise in the oil price,Voelte argues that demand for oil would slump if there was a slowdown in the global economy


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## visual (23 January 2006)

should we name today 
something along the lines of ................... monday
hoping not yet 

as in a crash?


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## bullmarket (23 January 2006)

Hi Visual

For me it's still way too early to call this a crash, but I guess that depends on what time frame one is trading/investing from.

XJO has made new highs recently and what we are seeing at the moment could be just a technical correction (see chart below) back to more normal longer term averages.  The 10 week exponential average for XJO is 4721 atm.

I would only call current long term uptrend, that began in March 03, over if XJO fell below the last major trough being the Oct 05 lows at ~4300.

I posted this over at www.stockmeetingplace.com on Dec 22.  I don't see anything yet to change my view.



> I still think XJO will stay within ~4300 - 4900 for at least the next 6 months and possibly 12. So imo there could still be a little more upside in XJO in the next few weeks, especially if the traditional New Year rally kicks in, but I also still think the DJIA will really struggle to break through 11000 if tested and that should keep a lid on our market.




cheers 

bullmarket

*XJO Weekly Chart*


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## visual (23 January 2006)

thanks bullmarket


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## mit (23 January 2006)

visual said:
			
		

> should we name today
> something along the lines of ................... monday
> hoping not yet
> 
> as in a crash?




In my opinion not quite yet. We are being driven by what's happening overseas. Today's drop is just reflecting friday's drop in the US. We might see more selling this afternoon pricing in some weakness in the US tonight.

I think that in the next couple of days we will be eagerly watching the American markets.

MIT


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## bullmarket (23 January 2006)

No problem visual 

I agree in general with mit's post as well.  I don't see any bargains amongst 'blue-chips' atm and so I feel that after recent all time highs investors/traders will be sensitive to any negative news.

cheers

bullmarket


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## Prospector (6 April 2006)

penfisher said:
			
		

> I am a professional philosopher with an interest in Alchemy. My reading of the Planets says that the markets will Crash down from 22 October till May 2006. Not a cliffhanger, more a downhill slippery slope.





Just had to repost this one....


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## wayneL (6 April 2006)

Prospector said:
			
		

> Just had to repost this one....




Maybe he had the chart upside down :


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