Imminent and severe market correction

[sam76]

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.....

lol I think that pretty much sums it up for me as well.

What was last night all about and where to from here?

 

[Aussiejeff]

Hahaha!

Talk about someone in total denial...

Anal-yst Marc Touati of Global Equities said the market behaviour reminded him of "a spoiled child who doesn't realise what his parents have done for him".

What a jerk. Actually, it is more a case of BAD PARENTING, you goose....

 

[IFocus]

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!!!

Yes back to the Banana republic, friends going to Bali complaining the Indonesian RUP down from 8000ish to 6000ish for AUD

Indo's may not even want to trade Bananas soon

 

[dhukka]

The FDIC was busy on Friday, 2 more failures to add to the list.

Meridian Bank, Eldred, Illinois

On October 10, 2008, Meridian Bank, Eldred, Illinois was closed by the Department of Financial and Professional Regulation of the Illinois Division of Banking and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.

Main Street Bank, Northville, Michigan

On October 10, 2008, Main Street Bank, Northville, Michigan was closed by the Michigan Office of Financial & Insurance Services and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.

 

[Aussiejeff]

From an article in the Australian newspaper today -

INVESTORS have been warned off the junior and mid-cap pure-play iron ore miners, as further bad news from China is anticipated.

Following Mount Gibson Iron's announcement that its Chinese customers want a delay in shipments because of credit issues, Goldman Sachs JBWere said the iron ore market had deteriorated further than it had realised.

"Clearly, in this circumstance we do not believe investors need to be exposed to the small, mid-cap pure play iron ore sector," analyst Stephen Gorenstein said in a note to clients yesterday.

To my mind, this spells BAD news (probably over an extended period of years) for an awful lot of iron ore companies. But then, why worry. Our economy will continue to charge ahead at 2-3% growth on the back of the infinite resources *boom*, if SuperKrudd, SwanDiver and IMF "ex-spurts" are to be believed.

 

[IFocus]

From an article in the Australian newspaper today -

INVESTORS have been warned off the junior and mid-cap pure-play iron ore miners, as further bad news from China is anticipated.

Following Mount Gibson Iron's announcement that its Chinese customers want a delay in shipments because of credit issues, Goldman Sachs JBWere said the iron ore market had deteriorated further than it had realised.

"Clearly, in this circumstance we do not believe investors need to be exposed to the small, mid-cap pure play iron ore sector," analyst Stephen Gorenstein said in a note to clients yesterday.

To my mind, this spells BAD news (probably over an extended period of years) for an awful lot of iron ore companies. But then, why worry. Our economy will continue to charge ahead at 2-3% growth on the back of the infinite resources *boom*, if SuperKrudd, SwanDiver and IMF "ex-spurts" are to be believed.

There is trouble in paradise

 

[bean]

For interest - those that know Dow Theory
Mention on a forum
Both the Industrials and the Transports closed at their lows for the year today. In particular, the Transports closed below their lows from January, which had not been breached since then.

So, the simultaneous lows confirm each other, and Dow Theory would say that we are headed down to the 2002 lows. Perhaps quickly. I am sure Richard Russell's column today will feature this prominently.

2002 Low 7215

For chartists '3 peaks ' or 'doomed house pattern' does that appear on the Dow?

Whatever it doesn't look good...surprise rate cut may only produce a brief short covering rally.
Will we see a run on the Banks in the US this week or next?

For the Chartists or those that looked up
'3 peaks ' or 'doomed house pattern'
you would have seen the pattern
Play out over the last week

So are we at
28 Price bottoms near point 10. This decline may not be a straight-line affair, but it always happens.
Point 10 is that near the 2002 Lows?

 

[bean]

Speculation
From another Forum in US
A world wide Bank holiday monday?
Obama speaks to nation on tuesday?

Just hope G7 come out with something big over the weekend

 

[moXJO]

Lets hope for a V reversal on the Dow daily (isn’t that last candle a reversal sig?). I don't feel like having total financial collapse this week.

 

[Aussiejeff]

Lets hope for a V reversal on the Dow daily (isn’t that last candle a reversal sig?). I don't feel like having total financial collapse this week.

That would be so-o-o passe. :bananasmi

 

[moXJO]

That would be so-o-o passe. :bananasmi

Yes totally clashes with my plasma TV purchase.


On a serious note you would hope for some sort of reversal at these levels.

 

[chops_a_must]

Lol...

Oct. 13 (Bloomberg) -- The U.S. Federal Reserve said central banks will offer financial institutions unlimited dollar funds, backing up efforts by governments to restore confidence in markets.

The ECB, the Bank of England and the Swiss central bank will conduct dollar auctions with maturities of seven days, 28 days and 84 days at a fixed interest rate, the Washington-based Fed said on its Web site today. The Bank of Japan will consider introducing ``similar measures.''

Policy makers from the Group of Seven nations pledged at the weekend to take ``all necessary steps'' to stem a market panic after the MSCI World stock index plunged 20 percent last week. Central banks last week cut interest rates in tandem for the first time since 2001, the U.S. plans to buy $700 billion in distressed assets from banks and in Europe, the U.K. is leading a push to keep lenders afloat with taxpayers' money.

``By providing unlimited dollar funds they are acting on the back of the G-7 plan to ensure the system is fully liquidized,'' said Lena Komileva, an economist at Tullet Prebon Plc in London. ``We're going to see even more liquidity provided and more aggressive rate cuts are coming.''

Central banks are expanding their toolkits after money-market lending rates surged to records last week. The Fed on Oct. 7 said it will create a special fund to buy U.S. commercial paper and the ECB last week said it would offer financial institutions unlimited euro funds. The Bank of England is scheduled to announce a revamp of its own money-market operations later this week.

`Work Together'

The cost of borrowing in dollars for three months nevertheless jumped to the highest level since Dec. 27, the British Bankers' Association said Oct. 10.

The ECB, the BOE and the Swiss National Bank ``can provide U.S. dollar funding in quantities sufficient to meet their demand'' into 2009, the Fed said today. ``Central banks will continue to work together and are prepared to take whatever measures are necessary to provide sufficient liquidity in short- term funding markets.''

All of the previous dollar swap arrangements between the Fed and other central banks were capped.

Today's ``action is unprecedented,'' said Neil Mackinnon, chief economist at ECU Plc in London and a former U.K Treasury official. Komileva said it may have a ``bigger impact'' than last week's rate cut ``in terms of practical impact on dollar libor globally.''

G-7 finance chiefs pledged Oct. 10 to take ``urgent and exceptional action'' after stocks plunged and as a global recession looms. European leaders yesterday agreed to guarantee new bank debt and use taxpayer money to keep distressed lenders afloat. Royal Bank of Scotland Group Plc, HBOS Plc, and Lloyds TSB Group will get an unprecedented 37 billion-pound ($64 billion) bailout from the U.K. government.

The collapse of New York-based Lehman Brothers Holdings Inc. precipitated the latest chapter of the 14-month crisis, causing banks to stop lending to each other out of concern they may not get their money back.

http://www.bloomberg.com/apps/news?pid=20601087&sid=ad3yz0VA2AY8&refer=home

 

[Snakey]

I saw Friday the 10th as an opportunity day because i thought the dow would bottom on friday night. In january I predicted a bottom on xao as being 4200 instead it got lower. the dow hit 7770 friday night then bounced significantly.
this indicated to me that the bottom in fact was reached. The dow is very important because its driving the worlds markets. (like it or not) The fact that it bottomed wiping out the five years of boom in value was excessive. Excessive bottom is what we are looking for. Now i expect a rally to at least 5000 settling at 4600.` As per support lines on chart. my

 

[chops_a_must]

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.

Looks like I'm going to be ahead 300% or thereabouts on the GM, and about 30% on the GE. Not bad for a few days work...

 

[Edwood]

8,500 Dow - nearly at the 7,500, should do it tomorrow at this rate. What a run hey! tomorrow is a turn date mind...

turned on the date 'n all

gotta love the way markets can rally as far and as hard as they like but as soon as they drop by X amount the cb's kick in

 

[Kauri]

if the S+P is going to bounce... via another gov. initiative or three... this might be as good a place as any??

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

butt.... where next??

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

 

[Kauri]

The Wall Street Journal is reporting that the White House will roll
out details of the bank rescue plan tomorrow that will include a plan for the
Treasury to take approximately 250 BLN USD in equity stakes in potentially
thousands of banks. In addition, the FDIC is expected to temporarily extend its backstop from bank deposits to new senior preferred debt issued by banks and thrifts for three years.
Cheers
.........Kauri

 

[MrBurns]

I really don't understand how all this will work, they're just saving the banks so they can repeat their mistakes all over again.

The system caused this and they're propping up the system ????????

There needs to be wholesale change and that cant happen without changing the way things work not supporting the way things got us into this mess.

At the end of the day, Govt will have more control over people and the rich will be super rich. I think that's the plan.

 

[noirua]

I really don't understand how all this will work, they're just saving the banks so they can repeat their mistakes all over again.

The system caused this and they're propping up the system ????????

There needs to be wholesale change and that cant happen without changing the way things work not supporting the way things got us into this mess.

At the end of the day, Govt will have more control over people and the rich will be super rich. I think that's the plan.

All the Governments want to do is sell their bank holdings, to make a profit, and get re-elected.

 

[moXJO]

Oh look ...calls for one bank to control us all

World 'needs new financial system'
World leaders must meet to agree a new Bretton Woods system, Prime Minister Gordon Brown said, referring to the global financial architecture agreed at the end of World War II.

http://www.news.com.au/business/story/0,27753,24493647-31037,00.html