Imminent and severe market correction

[gav]

Dow is down another 3.3%! (285pts)

 

[davo8]

Even if we have not reached the bottom there are a lot of stocks that are good value and 'now is the hour" to adjust your portfolio. I've just placed some buy orders and a few "sell the dogs" and build in some tax losses. Happy trading, chances like this do not come around often, make the best of a bad lot.

I confess to being very relieved. The waiting was getting on my nerves. I sold out of almost everything Oct-Feb and forecast October as "the big one" with a range of 4000-4500. Now I'm waiting to buy.

However, I still say (as I have told Whiskers so often): this is NOT the bottom. But perhaps you can see it from here! It still doesn't feel right, but it's getting close.

Problem is, lots of stocks you could buy still have bad news ahead. Banks may never recover; retail, developers are in for a tough time. It could be a many months before we see growth, so recession-proof, non-financial, dividend-paying stocks are ideal. TLS anyone?

 

[chops_a_must]

It could be a many months before we see growth, so recession-proof, non-financial, dividend-paying stocks are ideal. TLS anyone?

Certainly agree in part.

But it will be interesting to see what happens when TLS stops paying divvies out of debt...

 

[dhukka]

Anyone game enough to call a short covering rally in the afternoon on Wall street tonight? Must be due soon. Morgan Stanley is now a sub $10 stock. GM Sachs now at $85.

 

[chops_a_must]

Anyone game enough to call a short covering rally in the afternoon on Wall street tonight? Must be due soon. Morgan Stanley is now a sub $10 stock. GM Sachs now at $85.

I've got some nothing money on a rally sometime between now and next Friday Dhukka.

 

[brty]

Considering the dow is already 200 points above the early bottom, does this count as your rally???

Whoops 300 point above the bottom as I type.

Fast fast market.

brty

 

[chops_a_must]

Considering the dow is already 200 points above the early bottom, does this count as your rally???

Whoops 300 point above the bottom as I type.

Fast fast market.

brty

I reckon we're going to get an almighty short squeeze on some of these...

 

[dhukka]

Considering the dow is already 200 points above the early bottom, does this count as your rally???

Whoops 300 point above the bottom as I type.

Fast fast market.

brty

Maybe that's all we get? just rally back to a couple of percent down instead of 7 or 8% down.

 

[chops_a_must]

Maybe that's all we get? just rally back to a couple of percent down instead of 7 or 8% down.

The fact the buyers haven't been broken here is a bullish sign.

FWIW, long calls in GE and GM, and looking for very sharp runs here.

 

[brty]

The dow is now in positive territory for the day after being down 460+.

Banks are strong, and news of paulson thinking of taking radical measures. I wonder if that includes spending some change (a few billion) on buying today.

brty

 

[dhukka]

Looks like Bush failed to inspire, now there's a surprise.

 

[chops_a_must]

Looks like Bush failed to inspire, now there's a surprise.

For all his gunslinging, he'd rock up to a duel without a gun. That's how pathetic he is.

 

[chops_a_must]

And Morgan Stanley being put to the sword...

 

[Sean K]

Looks like Bush failed to inspire, now there's a surprise.

He was pretty crap, as usual. I was surprised the market held up as he was speaking, but as soon as he left the garden it crumbled..

Was interesting watching the rollercoaster this am, especially the trading floor cheering as the index went back up into positive territory...lol

 

[chops_a_must]

We're gonna have fun Monday.

Financials killed, commodities killed. Copper down 12% or something.

We're probably heading to 3300...

 

[Dextrum]

I commend you to examine this chart of the Dow, which shows the P/E ratio of the US market since 1881 (courtesy of NY times). It clearly shows that US market was way overvalued at 35 P/E as at 21 Sep 2008. The average over last 125 years was 14-16

If we take 1985 as a guide we can expect the market to bottom out at 5-6 P/E which will then be a buying opportunity, also for Oz market. The US market has some way to go however a buy in at P/E levels of 5-6 should be rewarded.
www.nytimes.com/imagepages/2008/09/21/weekinreview/20080921_LEONHARDT_GRFK_A.html

 

[noirua]

We're gonna have fun Monday.

Financials killed, commodities killed. Copper down 12% or something.

We're probably heading to 3300...

We are waiting for the sellers to realize the market is oversold and stop the pannick selling. Monday may well surprize by being mixed at the start and ending level to up on the day.

 

[Sean K]

We are waiting for the sellers to realize the market is oversold and stop the pannick selling. Monday may well surprize by being mixed at the start and ending level to up on the day.

I thought this morning was capitulation after that bounce, but at mid day I wasn't so sure, and now I'm confused about being unsure.....

 

[Aussiejeff]

I thought this morning was capitulation after that bounce, but at mid day I wasn't so sure, and now I'm confused about being unsure.....

I'm pretty sure of one thing - the $AUBananBuck is ON THE NOSE...

Currently down 6% to .643 USD!!

Where the bloody hell are ya, tourists!!!

 

[Aussiejeff]

Anyone know how many stock exchanges were suspended yesterday? From the sound of the media reports, quite a few have decided to pull out of the World's Biggest Poker Game.

Also, when I scrolled through the ASX announcements list yesterday, I noticed an AWFUL lot of Trading Halts, most with no brief explanation. Wonder why so many? Guess we find out next week.

Lastly, however this financial markets mess plays out from now and due to the economic lag effect involved, I feel safe in predicting the end of OCT (Jul-Aug qtr) and end of JAN (Oct-Dec qtr) company reporting periods are probably going to be very miserable reading for many companies that have so far appeared to sail safely beneath the radar - let alone for those currently hanging on by a thread.

This is shaping up to be Santa's Worst Xmas for many a year....