Imminent and severe market correction

[Whiskers]

I'm off on a bit of a tangent, but true by title... this property market looks on pretty loose foundations to me.

I know it doesn't rain much in Dubai, but struth, wouldn't one decent cyclone make a mess of these properties.

DUBAI (Reuters) - Nakheel, developer of palm-shaped islands off Dubai's coast, plans big investments in listed property firms in Asia, the United Kingdom and the United States as the credit crunch offers opportunities to snap up bargains.

http://www.reuters.com/article/GlobalRealEstate08/idUSL2536035420080625?pageNumber=1

 

[Family_Guy]

If the dooms dayers are correct, then that above will all be under water in a couple of decades.

 

[Macquack]

I'm off on a bit of a tangent, but true by title... this property market looks on pretty loose foundations to me.

I know it doesn't rain much in Dubai, but struth, wouldn't one decent cyclone make a mess of these properties.

And the only chance of catching a wave is the next tsunami.

 

[Aussiejeff]

I'm off on a bit of a tangent, but true by title... this property market looks on pretty loose foundations to me.

I know it doesn't rain much in Dubai, but struth, wouldn't one decent cyclone make a mess of these properties.

Nice to see how the Mega-Rich Sheiks are putting a significant amount of the world's wealth (all that money has to come from somewhere) into such worthwhile projects for the benefit of the MegaRich...

Hmm.. is that a mega dust storm building up in the pic??

 

[sassa]

Two views on the FOMC statement.

``I like the comment of diminished economic risk, because what it tells the markets is that they feel increasing confidence that the economy is bottoming,'' James Paulsen, chief investment strategist of Wells Capital Management, which oversees about $222 billion, said in an interview on Bloomberg Television. ``That's a good thing.

http://www.bloomberg.com/apps/news?pid=20601057&sid=apWLC7H7m7CQ&refer=futures

In announcing "no change" in rates today, the Fed pretends that its policy is perfectly calibrated to deal with the current economy. In reality however, the Fed is pinned down by a cross fire of inflation and recession. They see their best move as keeping their heads down and hoping that they emerge unscathed. Perhaps Alan Greenspan's best move as Fed Chairman was getting out when he did.

The reality is that America is faced by stagflation, economic recession and financial inflation at the same time! Rank and file American investors are beginning to understand this. As a result, U.S. stock markets are looking decidedly nervous. The possibility exists for major falls in the months and years ahead. However, don't look for anyone on television to tell you this. They are too busy shaking their pom poms

http://www.safehaven.com/article-10601.htm

 

[sam76]

Futures pointing to a nasty open.

currently at 11698 off 116

 

[Whiskers]

Originally Posted by sassa

The reality is that America is faced by stagflation...

I don't think we've got too much to be worried about sassa.

Full blown recession was never in my calculations and the revised numbers suggest it was not even close. As for stagflation... again I think a misnomer or mis-diagnosis. The problems in the financial sector are self inflicted by poor management. Although the effects flow through to the wider economy to some extent, all the best (government) economic management in the world cannot save bad managers from themselves. In other words the way I see it is this sector will have to evolve it's self dicipline or face continuing forced dynamic restructuring... some of which is coming from tighter regulation.

The property market was over rated up and down as was consumer spending and all will recover. The lynch pin is obviously oil. What I see happening is people are already pretty seriously curbing oil use, eg GM has came out saying it's time to seriously engage in alternative powered vehicles because consumer sentiment has shifted substantially that way, and I would be surprised if congress does not treat oil as a vital resource and severely limit the speculative influence in oil trading.

I still see these types of measures supporting the USD in the medium term, which will benifit our mining industry with better cost to revenue ratios.

WASHINGTON (Reuters) - The economy grew at an upwardly revised 1.0 percent annual rate in the first three months of 2008, helped by stronger consumer spending and exports, a Commerce Department report showed on Thursday.

The department had estimated a month ago that gross domestic product, or GDP, grew at a 0.9 percent rate. GDP measures the total output of goods and services within U.S. borders.

Economists polled by Reuters had expected GDP to advance at a 1.0 percent pace. The figure was initially reported in April at an anemic 0.6 percent, fueling concerns that the U.S. economy may be slipping into recession.

Consumer spending, which accounts for more than two-thirds of national economic activity, rose by 1.1 percent in the quarter, a touch stronger than the 1.0 percent estimate given last month, helped by increases in medical care services. Despite the upward revision, consumer spending remained at the lowest level since the second quarter of 2001, which was during the last recession.

http://www.reuters.com/article/ousiv/idUSMAR64567120080626

 

[Whiskers]

Headlines like Goldman downgrades fellow banks at http://money.cnn.com/2008/06/26/news/companies/goldman_brokers/index.htm?postversion=2008062609 isn't helping much either.

Pretty much a case of bag the opposition to make your own prospects appear better... becoming a bit of a self fullfilling prophecy.

 

[theasxgorilla]

Doesn't look good IMO. A growing number of investors dont want to be long equities right now.

 

[2020hindsight]

I'm thinking of getting into 100% cash for the end of financial year -
....
Incidentally, does anyone know if the market typically follows a pattern at "new financial year"? up? down?

Mental note... - beware of the end of financial year dip in the market after years like this ...

They infer the selloff only happens after bad years.

I'm not saying its the only factor at play here ... BUT - this article happily says TODAY (sorry YESTERDAY) (don't recall them saying much last week about it ) that "it was predictable" etc ... "It is an annual event but it is more pronounced this year" etc

"locking in losses"!? - heck, I was trying to secure the best outcome for the year I could - just for some self respect when my books go to the accountant!

http://www.news.com.au/business/money/story/0,25479,23922142-5013953,00.html

By Andrew Carswell June 26, 2008 07:17am

AN increase in investors selling shares to lock in tax losses will now ensure 2007-08 is the worst year for the Australian sharemarket in a quarter of a century.

It may be as annual as Easter, but the frenetic share sell-off on the eve of the new financial year has reached epic proportions, analysts say.

One has to dig back into the archives to 1981-82 to find a year that has surpassed the losses that have been incurred by investors in the past 12 months.

Yesterday's sharp plunge took the full-year losses to 15.2 per cent so far - a horror downturn for investors who had been quite used to year-on-year gains.

The previous financial year, investors reaped rewards when the market increased by 29 per cent.
CommSec economist Savanth Sebastian told The Daily Telegraph it was no surprise to see shareholders running for the exit before financial year's end.

Nor was he surprised at the vast number of those selling, given that a high percentage of shareholders would have experienced losses this year.

"The markets are about to draw to a close on the worst year in 26 years, so it is no surprise that we are seeing a lot of people locking in those tax losses to wipe out any gains, perhaps even gains in the property market.

"We've seen a lot of mum and dad investors buy blue chip stocks, particularly banks in recent time but banks have pulled right back, so there would be people selling to lock in losses and buying in the new year," he said.

"It is an annual event but it is more pronounced this year because the market has fallen 15 per cent."

 

[2020hindsight]

mental note 2
might be good time to buy - just before EOFY
If the buy orders are all waiting for next Tuesday - why not get in first and buy Monday ?

 

[2020hindsight]

continued..

"So you may sell your underperforming shares and quickly get back in next year but selling off and not buying back in is probably criminal at this point," Mr Sebastian said.

It was a message reiterated by Colonial First State chief equities analyst Hans Kunnen, who urged investors to think long-term.

He also suggested it would be dangerous to sell out this week in a bid to lock in losses for tax benefits, and potentially miss the boat the following week

PS This article will not have taken into account last nights oil price hike - adverse reaction in Wall St etc
do you own oil search

 

[explod]

The close of the Dow is a low going back to October 06. A bit of support around 11,000 but after that ? The completion of head and shoulder will take it to the `11,000, and to 10x by the end of the year. I think I could be sooner, (but there is no value in THINK)

Tonight may go down as Black Friday. But it may be next week or so, but looking slippery now.

Anyway, there has been plenty of signs and warnings, so ASF members will be ok.

 

[2020hindsight]

Anyway, there has been plenty of signs and warnings, so ASF members will be ok.

explod , howdy
but the bellboy keeps giving me all these great tips

 

[explod]

explod , howdy
but the bellboy keeps giving me all these great tips

Yeh, but the Bellboy has a speial position, not everyone can get in.

I'm waiting for the Taxi Drivers. Though I was talking to one a few years ago who also owns a nice farm just north east of Frankston near the new Freeway. He had particular view about gold. So the sell signals have to be watched sometimes. Bit like the black box trading described on the Immen..thread today. Has to be watched.

 

[sassa]

All in all, it was a terrible, horrible, no good very bad day

The SPYs opened lower and continued to move down for the rest of the day. This is clearly a very bearish chart that does not bode well for the future

http://www.bonddad.blogspot.com/

 

[sassa]

Full blown recession was never in my calculations.

Hard to argue with this:

"Nothing has been a more reliable indicator for an upcoming recession as the price of Oil. Every major bear market, every major economic decline has been preceded by a large spike in oil prices. The 73-74 recession, recession of beginning 80's and the recession of 2000. Oil prices jumped 80% between 1999 and 2000. Oil prices have been the most important indicator of major economic disasters. Whenever Oil prices rise about 80% from year ago levels, a fair chance does exist that a recession/bear market will follow."

http://www.bigpicture.typepad.com/

 

[Aussiejeff]

mental note 2
might be good time to buy - just before EOFY
If the buy orders are all waiting for next Tuesday - why not get in first and buy Monday ?

Hmmm. Then again, it might be prudent to wait for the tsunami of potentially *DISMAL* (IMO) company reports covering the last quarter to be unmasked.....

As the first wave of floodwaters subside around end of July, maybe some sad pickings will be lying cheaply around the seaside.

But, beware Rockfish and Blue Octopii....

AJ

 

[nioka]

Bedtime story.

"And as the lemmings gathered beside the cliff a big bad black bear lurked in the dark background waiting to attack."

Next episode after the break.

 

[ithatheekret]

I wonder if the US gov. will now attack the other speculators that have supported its balance sheet over the eons . Well for now , it looks like somebodys called abandon ship .