Imminent and severe market correction

[Kauri]

Yep and on the open today the $US index goes up, figure that ???

G7 rhetoric??

 

[explod]

G7 rhetoric??

ten out of ten again Kauri, wonder how long it will sustain. Could be some broken glass this week I think ??

dangerous to think

 

[Whiskers]

ROFLOL. That's a classic Whiskers - one to be trotted out in the near future

Sure thing, uncle.

A question. With oil @ $110, if the US starts to recover, would not that imply a higher price due to the increasing demand?. If oil @ $110 is hurting them now, what then? Classic demand destruction.

On face value it would uncle. With US oil consumption running at about 20m bpd, they have cut back about .5m bpd. They have a lot of potential to reduce demand for oil just by buying fuel efficient cars, a trend that has started and I expect will accelerate once all US vehicle manufacturers start making more fuel efficient models.

It might have to stay at these levels for awhile though, to convince many yanks that the days of gas guzzling vehicles are over.

But having said that, there are some massive shale (or was that sand) oil reserves, in Canada for example, that I believe are now economically viable and are in the process of being developed.

 

[Kauri]

ten out of ten again Kauri, wonder how long it will sustain. Could be some broken glass this week I think ??

dangerous to think

The widely shared view in the Asian narket is that the change in the
G7 message will not support the USD for very long and the USD/JPY remains vulnerable due to rising risk aversion ahead of a busy event week.

Cheers
........Kauri

 

[Whiskers]

I know I've said it before :hide:... but an observation I made a while ago and reiterated below by a couple of leading intellectuals ... is that many businesses are not burdened with debt, nor is the ability to raise debt a problem for them.

But as these fine gentlemen point out it's a bit of a see-saw battle to see who is winning, ie how much damage the financials will do in the meantime.

Recession Has Bernanke, Greenspan Agreeing Companies Have Cash

By Rich Miller

April 14 (Bloomberg) -- The U.S. economy has what Alan Greenspan calls one ``major advantage'' as it falls into a recession: Businesses are in far better financial shape than they were entering the past two contractions.

Corporations outside of financial services -- from Cisco Systems Inc. to Coca-Cola Co. -- have collectively socked away more than half a trillion dollars in cash. They have also reduced short-term debt and cut inventories to record-low levels in relation to sales, leaving them better prepared than in the past to weather a contraction.

``We still have what, at the moment at least, appears to be a reasonably good real economy, as distinct from finance,'' the former Federal Reserve chairman said at an April 8 conference...

...

The current Fed chief, Ben S. Bernanke, sees it much the same. On April 2, he told lawmakers that aside from the banking and securities industries, corporate balance sheets are sound -- a ``positive'' for the economy.

...

Debt as a percentage of net worth for non-financial companies outside of farming was 61.3 in the fourth quarter of last year, compared with 68 at the start of the 2001 recession and 93.6 in the 1990- 91 contraction, Fed figures show.

``Cash flows are more than adequate, and the amounts of monies that they need are very readily financed in the weakened credit markets,'' Greenspan said at the April 8 conference.

http://www.bloomberg.com/apps/news?pid=20601109&sid=aUv3WCFs__qw&refer=exclusive

 

[explod]

I know I've said it before :hide:... but an observation I made a while ago and reiterated below by a couple of leading intellectuals ... is that many businesses are not burdened with debt, nor is the ability to raise debt a problem for them.

But as these fine gentlemen point out it's a bit of a see-saw battle to see who is winning, ie how much damage the financials will do in the meantime.

And why the cutting down, or more to the point batterning down? to be ready for the mother of all recessions.

Intellectuals, yes, but what they are saying and what they do not want you to know are very different.

Every day big conglomerates are going to the wall, the money and productivity is one thing but add to that the job losses and the rising costs of living. One could go on.

Whiskers I usually ignore your posts and move on but feel you should be warned to have a deeper look at the facts. The Greenspans and Bernarkes of this world are puppets playing tunes to the sheeple.

Those in denial and dream world unfortunately, are in for a torrid time.

 

[dhukka]

Some interesting comments from Wachovia's CEO:

"The precipitous decline in housing-market conditions and unprecedented changes in consumer behavior prompted us to update our credit-reserve modeling and rely less heavily on historical trends to forecast losses. As a result, we have substantially increased our reserves," said Ken Thompson, Wachovia's chief executive officer, in a statement.

Translation - this is off the charts, like nothing we've ever seen. That's why we are raising $7 billion in new capital and slashing our dividend by more than -40% 2 months after raising $3.5 billion and at that time assuring shareholders that dividend payments would not be cut to conserve cash.

Interesting times

 

[Whiskers]

Whiskers I usually ignore your posts and move on...

Oh well.

...but feel you should be warned to have a deeper look at the facts.

Facts are interesting... but when dealing essentially with human ego, vested interests, emotions etc... the facts count for little as you allude to in your next sentence.

The Greenspans and Bernarkes of this world are puppets playing tunes to the sheeple.

I totally agree here, explod.

I don't know if you saw my 'column' in the XAO thread, but I'm monitoring people and their behaviour, not just the economic facts... cos as you highlight, people have vested interests, biases and sometimes are just stubornly ignorant and don't always do a rational thing let alone the right thing.

 

[spectrumchaser]

http://www.reuters.com/article/marketsNews/idCNTSIN16290420080414?rpc=44

SINGAPORE, April 14 (Reuters) - Equity markets have found a bottom and are poised to hit new highs in the second half of this year, according to a senior chartist at Dutch-Belgian bank Fortis.
He also said many stock markets have given up about 38 percent of their gains since the start of the latest rally, which based on Fibonacci charts, suggested the markets have found a bottom.
Some investors use charts rather than economic fundamentals predict movements in financial markets.

One of the most popular charting methods involves the use of Fibonacci numbers, based on the work of a 13th century Italian mathematician, which suggest markets tend to find support or resistance at certain "golden ratios" commonly found in nature.


Next the banks will disclose they have been using gypsies and crystal balls !

 

[wayneL]

http://www.reuters.com/article/marketsNews/idCNTSIN16290420080414?rpc=44

SINGAPORE, April 14 (Reuters) - Equity markets have found a bottom and are poised to hit new highs in the second half of this year, according to a senior chartist at Dutch-Belgian bank Fortis.
He also said many stock markets have given up about 38 percent of their gains since the start of the latest rally, which based on Fibonacci charts, suggested the markets have found a bottom.
Some investors use charts rather than economic fundamentals predict movements in financial markets.

One of the most popular charting methods involves the use of Fibonacci numbers, based on the work of a 13th century Italian mathematician, which suggest markets tend to find support or resistance at certain "golden ratios" commonly found in nature.


Next the banks will disclose they have been using gypsies and crystal balls !

LOL

Paul Nesbitt, London-based technical analysis director at Fortis Private Bank, told Reuters on Monday that the Dow Jones industrial average .DJI may rally to 15,781 points this year, a gain of more than a quarter from Friday's close of 12,325.42.

Not 15,782 or 15,780, but exactly 15,781.

I use Capricciosa numbers, and they say that anchovy prices will rise to exactly double the price of tomato paste.

 

[Porper]

One of the most popular charting ...t of people will be bleating they were right.

 

[explod]

Yes, but 38.2% isn't the only fib no spectrumchaser.

If we go through 38.2% there is a good chance we will get to 50%, then even 61.8% although highly unlikely.

There are dozens of scenarios and even more predictions, so a lot of people will be bleating they were right.

The nonsense (not yours Porper) further confirms the denial of the very dire economic fundamentals in the world economy. If we find the truth hard to swallow we look for a way out.

Why not accept the facts and invest accordingly, there a some great opportunities. Of course one has to do a bit of research and follow new paths but that has always been the case for success.

 

[Kauri]

The nonsense (not yours Porper) further confirms the denial of the very dire economic fundamentals in the world economy. If we find the truth hard to swallow we look for a way out.

Why not accept the facts and invest accordingly, there a some great opportunities. Of course one has to do a bit of research and follow new paths but that has always been the case for success.

I accept the facts, both fundemental and technical, to do otherwise is denying the truth, if one ignores either one or the other they are choosing to ignore something that drives the markets, after all one has to do a bit of research and follow new paths but that has always been the case for success.
Cheers
..........Kauri

 

[Kauri]

UK PM, Brown (Reuters) says we must prevent what is happening in US from being repeated in Britain. He goes on to say the challenge is to prevent rising unemployment and Mortgage repossessions

.

Now who said that he wasn't on the ball, ...
Cheers
...........kauri

 

[wayneL]

.

Now who said that he wasn't on the ball, ...
Cheers
...........kauri

"Too late!" she cried.

Gordo and nulabor are toast; rabbits in the spotlight.

http://www.timesonline.co.uk/tol/news/politics/article3746918.ece

 

[GreatPig]

If we go through 38.2% there is a good chance we will get to 50%, then even 61.8% although highly unlikely.

Then 100%.

Should be some good bargains around then...

GP

 

[Kauri]

Can't track it down but a report doing the rounds suggests that the odds of an Aussie recession are increasing... so tis would be a rumour, if the powers that be.. in bold blue.. let it through...

A mass of Uridashi's going through recently... can the real powers that be see the top of the Aud cycle...

ECB reserves levels continue to be very volatile due to USD liquidity swap actions with reserves rising EUR9.5 bln in the week to April 11th due to the latest swap with reserves at EUR153.5 bln as a result. One central bank is still having problems with its balance sheet and has failed to provide a new update for the last six weeks....

Gold reserves declined by EUR38 mln due to sales from one Eurosystem central bank with net gold sales now seen for 177 out of the last 184 weeks....

Lingering in the background however remains the slowdown in the US economy with the reports of US foreclosures jumping 57% and the news that Linens N" Things has postponed a $16 mln interest payment with the press focusing today on a number of bankruptcies for US retailers...

Must dash, off to the off-license just realised the grog cupboard is empty and I have decided to limit myself to drinking only on days that end with a Y .. and I think today is one of them..

Slanty
.............kauri

 

[Kauri]

I hear State Street has been caught Jay-walking and fined $US 3.2Bln... may take the edge off the Dow.. for a whiles..

Cheers
............Kauri

 

[Kauri]

Is Intel due today???
no doubt after the bell...
bit of a fade on the S+P...
in anticipation....

Cheers
...................Kauri

 

[wayneL]

Is Intel due today???
no doubt after the bell...
bit of a fade on the S+P...
in anticipation....

Cheers
...................Kauri

Due at midday Kauri...