Are we there yet?

[0110]

On a related point what would ASF users consider to be the key indicators of an imminent turn around?

Do you see it be key U.S. economic numbers or something more gradual?

 

[Plugger]

I hope we're there! I've just read about news items coming out in the US this week, and one can't expect them to be good at all. Surely this would mean another red week passed on to us?

 

[Timmy]

On a related point what would ASF users consider to be the key indicators of an imminent turn around?

Do you see it be key U.S. economic numbers or something more gradual?

Interesting discussion relevant to your questions on the most recent few pages of this thread.

 

[korrupt_1]

Have the markets bottomed out yet? Has all this negativity and uncertainty finished yet?

That is the million dollar question... if anyone knows of where the bottom is,.. they're not going to be reading these forum as they're likely sailing on their $20M sailing boat...

My feel is that there is still more downside to all this before things get a little better. Just read all the news out there!! It's a nightmare. Good news is like a needle in a haystack these days. Mind you, history has shown that when the market looks the worse, and all hope has been dashed and massive amounts of people dumping stocks,.. THAT is 'usually' a turning point... all that needs to fuel the turn-around is a follow up of good news and presto, investors will come flooding back with optimism and plenty of cash. no-one wants to miss a ride and everyone will jump on and the rally back to record highs is back on!!!!

 

[mfp]

THAT is 'usually' a turning point... all that needs to fuel the turn-around is a follow up of good news and presto, investors will come flooding back with optimism and plenty of cash. no-one wants to miss a ride and everyone will jump on and the rally back to record highs is back on!!!!:)

LOL, you're dreaming aren't you?

 

[bunyip]

Roughly sixty large cap US companies have earning reports due out this week.
It's difficult to imagine many of these companies reporting earnings that inspire investor confidence. Mind you, the large institutions who invest in these companies usually have a pretty good idea of the probable earnings results of each company, and these expectations are usually factored into the share price already.
A company that announces earnings that are pretty much in line with expectations is not going to immediately have its share price crucified.
But those whose earnings are way below expectations - they're the ones that really get hammered.
So how many of these 'below expectations' earnings will we see this week? Enough to plunge the US market even further, and drag our market down with it?
I have no idea.....but I'm pleased I know how to use put options.

Bunyip

 

[dhukka]

Roughly sixty large cap US companies have earning reports due out this week.
It's difficult to imagine many of these companies reporting earnings that inspire investor confidence. Mind you, the large institutions who invest in these companies usually have a pretty good idea of the probable earnings results of each company, and these expectations are usually factored into the share price already.
A company that announces earnings that are pretty much in line with expectations is not going to immediately have its share price crucified.
But those whose earnings are way below expectations - they're the ones that really get hammered.
So how many of these 'below expectations' earnings will we see this week? Enough to plunge the US market even further, and drag our market down with it?
I have no idea.....but I'm pleased I know how to use put options.

Bunyip

Take a look here post 1247. There is some potentially good earnings news this week as well as bad.

 

[bunyip]

Take a look here post 1247. There is some potentially good earnings news this week as well as bad.

Ah....A mixed bag by the look of things. This should be an interesting week in the US....I imagine there'll be some very nervous investors around!

 

[korrupt_1]

LOL, you're dreaming aren't you?

yeh I'm dreaming... don't we all.. but in all serriousness... look at the massive rally back in August 07. When the market started recover and conditions were overbought, investors still jumped on in FEAR that they may miss out on the gains, whilst at the same time, the fundamental problems still exists... ie what has fundamentally changed between July/August and Sept/Oct??? Nothing. Yet new highs were made?!! Silly times...

 

[wayneL]

yeh I'm dreaming... don't we all.. but in all serriousness... look at the massive rally back in August 07. When the market started recover and conditions were overbought, investors still jumped on in FEAR that they may miss out on the gains, whilst at the same time, the fundamental problems still exists... ie what has fundamentally changed between July/August and Sept/Oct??? Nothing. Yet new highs were made?!! Silly times...

It was being spun that the credit crunch would not affect the economy... denial.

Now, even Art Laffer accepts that recession is likely. Reality bites.

 

[dhukka]

yeh I'm dreaming... don't we all.. but in all serriousness... look at the massive rally back in August 07. When the market started recover and conditions were overbought, investors still jumped on in FEAR that they may miss out on the gains, whilst at the same time, the fundamental problems still exists... ie what has fundamentally changed between July/August and Sept/Oct??? Nothing. Yet new highs were made?!! Silly times...

korrupt,

Wayne makes a good point. Ask yourself this; has the economic scenario improved, stayed about the same, or gotten worse since August last year?

I'll give you a couple of examples of why I think it has gotten worse. Back in August US corporate earnings for 4Q08 were forecast at double digit growth. The latest estimate from S&P is -13.6%. As late as early August Treasury Secretary Paulson said the subprime issue was contained. Paulson now says it is the greatest threat facing the US economy. It has since spread to Alt-A and even prime. It is not and never was just a subprime issue.

In August did anyone think Citigroup and Merrill Lynch would write down close to $40 billion between them? Did anyone think that Countrywide was bankrupt? Did anyone think that AMBAC would lose 90% of it's stock price, lose it's AAA rating and be unable to raise capital? Did anyone forsee the Centro debacle? I could go on but you get the point.

You could make the argument that all the bad news is now known and is therefore largely priced in. However I think it is more instructive to ask, what is not known? Think about what we didn't know in August 2007 and what we know now. What we will know in 6 months from now?

 

[MS+Tradesim]

Think about what we didn't know in August 2007 and what we know now. What we will know in 6 months from now?

I'm going to take a punt and say in 6mths we'll know how big the next lot of bank/brokerage writedowns will be after AMBAC and MBIA lose their AAA ratings.