Imminent and severe market correction

[Sean K]

I had a long message drafted then, but lost it....

In summary, we are still in a long term up trend....

ie, 1900 - 2007......

Bears will always ultimately become fur coats because the trend is UP.

What is that gambling principle.....???

Same applies for the market.

Bet with the trend...

I am surprised that some are betting against it actually.

And, as always, it may depend on your personal circumstances..

Good luck punters!!

 

[GreatPig]

I foresee a rise in the price of Lead

They still use lead in bullets? Don't they know that stuffs bad for your health...

GP

 

[>Apocalypto<]

I had a long message drafted then, but lost it....

In summary, we are still in a long term up trend....

ie, 1900 - 2007......

Bears will always ultimately become fur coats because the trend is UP.

What is that gambling principle.....???

Same applies for the market.

Bet with the trend...

I am surprised that some are betting against it actually.

And, as always, it may depend on your personal circumstances..

Good luck punters!!

but Kennas this time it's different!

nice post I could not agree more, I have also looked at long term charts (100years back). it's one major bull run. Quite amazing to look at actually it's like a gauge of human development and advancement.

Keep it positive Kennas!

 

[ithatheekret]

Well Merrills will more than likely plunge again . I don't know why shareholders let these twits get paid millions of dollars to lose record amounts of money .

Merrills have just made a historical first for the company , a historical loss !


I knew that recession mention of theirs was the pre-emptor of baaaaad tidings .

 

[wayneL]

but Kennas this time it's different!

nice post I could not agree more, I have also looked at long term charts (100years back). it's one major bull run. Quite amazing to look at actually it's like a gauge of human development and advancement.

Keep it positive Kennas!

I'd love to see it adjusted for inflation. Might tell a different story. The only problem is that the inflation figures have been an outright lie for a bit.

 

[>Apocalypto<]

I'd love to see it adjusted for inflation. Might tell a different story. The only problem is that the inflation figures have been an outright lie for a bit.

Dame u wayne you just ruined my little dream, now all I can see is a straight line!

 

[ithatheekret]

I'd love to see it adjusted for inflation. Might tell a different story. The only problem is that the inflation figures have been an outright lie for a bit.

Well you've tick all the correct boxes there , but we don't use the word lie , it's mistake , even if it's a pack of bull .

I don't see politicians rushing to lock up any market spruikers that rattled off the BS , even the new incomers seem abundantly quiet .

They [ companies] have to sign exchange documents to say the BS , surely that's forge and utter , with conspiracy to make monetary gains from unlawful acts .

Mandates that funds operate under , would have to be put under the microscope , especially those that borrow offshore and or don't have a proper cash reserve ratio , flaunting the laws again .

The old pollies end up as consultants to crapaholics anonymous or until we tell the market mob .

 

[ithatheekret]

Just going back over a few facsimiles signed and sent to the ASX .

I'd say there's a few federal offences under the communications act alone , stuff ASIC where's the Federal Police ...........

2008 will be a lawyers dream year .

 

[Uncle Festivus]

I had a long message drafted then, but lost it....

In summary, we are still in a long term up trend....

ie, 1900 - 2007......

Bears will always ultimately become fur coats because the trend is UP.

What is that gambling principle.....???

Same applies for the market.

Bet with the trend...

I am surprised that some are betting against it actually.

And, as always, it may depend on your personal circumstances..

Good luck punters!!

Yes, but within the mega trend there were periods of wealth loss that took many, many years to recover from, so unless you jag your entry/accumulation phase for a buy & hold strategy (based on when you were born), then today's markets gyrations make it even more prudent to decide if you should hold for a rebound, which may never come in your wealth accumulation lifespan. It seems normal (to expect it to always go back up) in this cycle because of it's unprecedented run of 18 years - newcomers just don't know what a full on bear market is, let alone know how to trade it.

It is indeed this time different - records are being broken, usually with reference points back to a famous period in the late 1920's. The unregulated shadow banking system is falling apart at the seams.

It would be a brave call to hold and to see profits accumulated over the last 4 years vanish in a few short weeks on the premise that the trend is still up. Any rally should be used as opportunities to offload and take profits or short.

Return of capital not return on capital?

 

[motorway]

some might find these interesting

Waiting For Average

The long-term average return from the stock market is 10.4%. As the earliest baby boomers are now beginning to retire, they will be relying upon their investments for income. The latest boomers have two more decades to compound their savings into a retirement payload. At 10%, boomers young and old””so to speak””have a good chance of a secure retirement. Yet, from today, what length of time is needed to assure the long-term average return?

NEVER””investors from today will never achieve the long-term average return. Not in ten years, twenty years, fifty years, or even the almost eighty years that represent the most recognized long-term average return.

http://crestmontresearch.com/content/market.htm



motorway

 

[ithatheekret]

Only thing positive at present is Skippy on and off , the USD as it's escapes every country it been in and RIO which looks to be holding up the FTSE .

Markets hanging in momentary suspension , just before they dive , the SENSEX was a classic hung in there , then dropped .

Could a nice bounce to sell into on the US boards , before the Fast Money disappears ..............

 

[Gundini]

It would be a brave call to hold and to see profits accumulated over the last 4 years vanish in a few short weeks on the premise that the trend is still up. Any rally should be used as opportunities to offload and take profits or short.

Return of capital not return on capital?

I tend to agree with the Uncle here, especially this point, but motorway also brings up a valid point. That being the Baby Boomers are setting up for retirement, and will be withdrawing super funds to use for spending.

While I don't believe it will happen at the rate proposed by Robert Kiyosaki, http://en.wikipedia.org/wiki/Robert_Kiyosaki in "Cash Flow Quadrant", there is bound to be a consistant withdrawel all the same, and with the number of X generationers being substantially less than the Baby Boomers, money flowing in is greatly reduced. 2010 should be the start of this phenomenon.

From memory, he also predicts the greatest Bull market of all time heading into this period.

So if you can truely understand these concepts, our Bull run hasn't even started. If you believe, like I do that this is a likely senario, then you can plan. And if you think I'm full of BS, that's ok too!

But, I think we are in for a hell of a ride leading up to 2010, just like to sit this period out till the dust settles.

Just think, after we have ridden the biggest Bull market of our time, we can afford to build a Bunker, with a Moat around it, and 50 Dobermanns to protect us from what may happen beyond 2010...

 

[theasxgorilla]

Are we still moving sideways ASXG?

Yes, well, last night on the US didn't look too flash now did it?? Still, 1300 on the SPY is a support/resistance level. How the index reacts around this level will be telling.

To answer your question...the last couple of weeks have been down, that goes without saying. On both the SPY and the XAO. But our market isn't the US. We didn't trade below previous significant lows today and didn't close firmly down on the low for the day a la the SPY. I don't know when people will wake up to the fact that the Aussie market has it's own characteristics and destiny. I'd like to extend the defintion of 'muppet' to people who espouse rhetoric about 'we just follow the US' blah blah...clearly not true!

If you take a look at the behaviour of the Aussie market between '99 and '03 you'll see what I would describe as a more or less sideways move consisting of many reasonable up trending periods. Contrasted against the UP-DOWN yo-yo market in the US you'll see that we can move sideways whilst the US is really 'bearing' it out.

 

[dhukka]

I had a long message drafted then, but lost it....

That's unfortunate because there is not much substance in this post.

In summary, we are still in a long term up trend....

ie, 1900 - 2007......

Oh well spotted! I'm assuming in the drafted message that got lost in cyberspace you qualified the above statement by saying, that although the market is in a century long uptrend, it does matter when you time your entry.

For example, if you bought $10,000 worth of the S&P500 in 1966, you would have had precisely $10,000 in 1982. adjust for inflation and you lost money.

 

[theasxgorilla]

If you take a look at the behaviour of the Aussie market between '99 and '03 you'll see what I would describe as a more or less sideways move consisting of many reasonable up trending periods. Contrasted against the UP-DOWN yo-yo market in the US you'll see that we can move sideways whilst the US is really 'bearing' it out.

Does anyone not think that Australia is better positioned economically than many (even most!) countries in the world and ought to weather recession in the US, perhaps globally, rather well?

 

[Gundini]

Does anyone not think that Australia is better positioned economically than many (even most!) countries in the world and ought to weather recession in the US, perhaps globally, rather well?

Of course we are, and will, but:

We still live off the sheeps back, and once demand for our goods slow, our growth will slow. When the world economies pick up, we will come good too.

But we can't grow without demand, all we will end up with is a stockpile of wool, as we did a few years back. We couldn't give it away.

Figure of speach of course!

 

[dhukka]

Yes, well, last night on the US didn't look too flash now did it?? Still, 1300 on the SPY is a support/resistance level. How the index reacts around this level will be telling.

To answer your question...the last couple of weeks have been down, that goes without saying. On both the SPY and the XAO. But our market isn't the US. We didn't trade below previous significant lows today and didn't close firmly down on the low for the day a la the SPY. I don't know when people will wake up to the fact that the Aussie market has it's own characteristics and destiny. I'd like to extend the defintion of 'muppet' to people who espouse rhetoric about 'we just follow the US' blah blah...clearly not true!

If you take a look at the behaviour of the Aussie market between '99 and '03 you'll see what I would describe as a more or less sideways move consisting of many reasonable up trending periods. Contrasted against the UP-DOWN yo-yo market in the US you'll see that we can move sideways whilst the US is really 'bearing' it out.

I've consistently brought this up on other threads. I don't know why people expect moves in ASX to mirror what happens on Wall Street.

There is no question they have their own unique characteristics. My point is that by the time you call a bear market it would have fallen 20%+. It's the same as getting through 2 quarters of GDP and saying, we are in recession. Not much value in that.

Also, it's pretty easy to select a period of time to support your argument. How about the Aussie market from Feb 2002 - Mar 2003? A loss of 24% over 13 months, was that not a bear market? It's easy to make the argument that it wasn't, just pull your time frame out a bit and it looks like a sideways move. Kennas has taken this to the extreme, and pulls the time frame out to 100 years and then says that's it's a long term bull market. Conveniently if you play that game you can never be wrong.

 

[ithatheekret]

Speaking of wool , the price moves we will see will be uniformed based , the same goes for cotton . Iron ore will rebound , but first people need to realise that this is an economic genesis we are going into . The end of one extended cycle which will have a bigger bump than usual , due to the fudging of growth data , which they have chased and chased to the stage they now know it's not there .

They ignored all the new beginnings semaphores in ores 8 years ago , instead they chased oil , and in doing so have trebled its price . W've watched Europe weather a strong Euro and high oil prices and they've wobbled , but still standing , so have we , but I believe the services sector and the attached will buckle us a little more to anywhere near 5400 being a possibility , that opens all avenues below , so say your prayer this week .

Bad markets create bad times .

A country with an absent President during its market plunge , used to be a loose cannon ...............

 

[dhukka]

Does anyone not think that Australia is better positioned economically than many (even most!) countries in the world and ought to weather recession in the US, perhaps globally, rather well?

On balance I'd have to agree. However every recession is different. We avoided the last US recession because we didn't have the over-investment in tech capital goods that the US had. This time round we don't have the glut of housing that the US has, that's not to say we won't have rising delinquencies and corporate defaults. Just that we don't seem to go to the extremes that the yanks do in creating bubbles.

I think we again have a good chance of avoiding a recession. However, that is contingent on how deep and prolonged the US recession is and the knock-on effects to the developing countries that are lapping up our resources. Our greatest strength of the last decade could also turn out to be our biggest weakness if resource demand drops off.

 

[Whiskers]

Well maybe a green day this time.

GE posts good result IBM earlier looking positive.

AP
GE 4Q Profit Meets Consensus
Friday January 18, 6:46 am ET
General Electric Reports 4th-Quarter Profit Growth of 4 Percent on Strong Global Demand
http://biz.yahoo.com/ap/080118/earns_general_electric.html

PS: With Bush unveiling the gist of his rescue package late friday morning and US markets closed monday, if the FED were to announce an early cut it seems to me that Friday after Bush speaks is probably the last chance.