Stock Market Crash - End of the Bull!

[wayneL]

Yep corn not looking to flash

Corn futures dropped more than 5% Friday -- the maximum price movement allowed for the contracts on the Chicago Board of Trade -- after the U.S. Department of Agriculture said it expects U.S. farmers to plant about 15% more corn acres than last year, as farmers take advantage of market demand for corn-based ethanol.
The annual USDA prospective plantings survey showed farmers intending to use 90.45 million acres for corn, above the 88 million acres predicted by analysts.
The data set "the stage for a rebuilding of depleted corn inventories and a subsequent reduction in corn prices during the fall of 2007," David Driscoll, an analyst at Citigroup, said in a research note Friday.
'The USDA's Plantings report sets the stage for a rebuilding of depleted corn inventories and a subsequent reduction in corn prices during the fall of 2007.'
”” David Driscoll, Citigroup

Against this backdrop, corn for May delivery dropped 20 cents, or 5.1%, to settle at $3.74 1/2 a bushel in Chicago. Trading was halted at that level because that's the exchange's daily price move limit. The contract hasn't traded at a level that low since Jan. 10.
The intended plantings would be a record number, according to Darin Newsom, an analyst at Omaha, Nebraska-based DTN. "But it doesn't mean anything," he said. Other analysts say the figure would be the largest since the 1940s.
"Production is also expected to be a record (theoretically), but ending stocks should still drop," he said.
Tim Hannagan, a grains analyst at Alaron Trading, said it best: "Come Monday, the trade will say it is not what you plant, but wheat you grow."
"A drought from mid-June to July 25th -- key yield development time -- could reduce yields sharply enough to void the current bearish acreage number," he said in a note to clients.
At 90.45 million acres planted and about 81.4 million acres harvested, using the trend-line yield of 153.1, that would mean production of about 12.5 billion bushels, said Newsom in e-mailed comments.
"That would just cover, if not still lose ground to the expected growth in demand in 2007-2008 -- meaning ending stocks could decrease despite record production," he explained.
So overall, the plantings number could be viewed as bearish for corn prices, but the final number of plantings will depend heavily on weather in the Midwest, which has endured rainstorms that lead to less corn planting, he said.
Another thing for traders to consider is whether the plantings report will discourage some from actually planting as much corn as they earlier intended, said Todd Hultman, president of DailyFutures.com, in his Web site commentary.
The 2007 USDA survey also showed farmers planned 67.14 million acres of soybeans, down from 76.9 million planned in the previous survey. See the full report.

It's also limit down (20c) today in the electro market. I had a short position I closed before the report was released too. Damn!! But could have easily gone the other way and locked futures markets are only fun if your on the right side... terrifying otherwise.

 

[Buffettology]

Post is not sarcastic and I mean what I say.You have no idea.A question is what you ask.

If a market is 100% unpredictable, then why so does the Federal Government and RBA involve themselves in Fiscal and Monetary policy? Certainly a mix of numerous factors to predict turnarounds, and very complex, especially once factoring in time-lags to the equation (this especially true with Fiscal Policy), however, Fiscal and Monetary policy have prooven effective in Australia, I have studied this in depth, both trends, and impacts of time-lags, and no doubt, a market is always somewhat predictable. Not to the exact timing and magnititue, but an educated estimate is more reliable than a guess.

 

[michael_selway]

You think Coal will maintain a high return over several years? I am more into long-term investments than short-sighted trading. Hence, my need for a crash/large correction to find undervalued, solid companies again. Most seem to be through the roof at the moment, I am talking Woolworthes, JB Hi-Fi etc.

Hi Buffet yes coal is good fo rthe long term, and at current prices, its good value

Look at coal price above as well

Also the yield is pretty good (low PE)

Isnt that what u are looking for?

thx

MS

 

[dhukka]

I'm not too worry about bull and bear market.. I just look for good stock at bargain price and buy them with a margin of safety.. I let Bull and Bear fight it other out....

I'm still in 100% don't care if bull or bear run for the next 30 years...

I found one bargain last week and tomorrow I'm putting in another order for another bargain

Wise words ROE, its re-assuring to know you are invested in good businesses at reasonable prices to ensure a margin of safety. No need for all this scurrying about trying to predict market tops and bottoms. Just sit back, keep accumulating the bargains and enjoy the ride.

 

[Freeballinginawetsuit]

It's also limit down (20c) today in the electro market. I had a short position I closed before the report was released too. Damn!! But could have easily gone the other way and locked futures markets are only fun if your on the right side... terrifying otherwise.

Yeah I had a bit of a squizz into Corn on the weekend, certainly up youre alley I would hazard a guess.

Gaining a sound forward view through fundamentals would have as much chance of success as the weatherman presenting a 3 month forecast . I guess thats the conundrum farmers are presented with each season, with the hazards speculated on the commodities futures.

You certainly aren't risk adverse Wayne..........perfect commodity for you!. Kudos

I bet you would like to speculate on banana's in cyclone season............. is thier such a thing as banana traders/market?

 

[Buffettology]

Wise words ROE, its re-assuring to know you are invested in good businesses at reasonable prices to ensure a margin of safety. No need for all this scurrying about trying to predict market tops and bottoms. Just sit back, keep accumulating the bargains and enjoy the ride.

I agree, wise words, though I have to say, it is VERY hard to find solid, undervalued stocks at good prices at the moment.

I will take a good look at that tip of yours ROE on the wkend. Cheers.

 

[Buffettology]

Hi Buffet yes coal is good fo rthe long term, and at current prices, its good value

Look at coal price above as well

Also the yield is pretty good (low PE)

Isnt that what u are looking for?

thx

MS

Thanks Michael. I havent looked at any of the resources sector (other than BHP), as I usually stick to the strong companies of which I know a lot about. Following my name, I do not invest in the current craze. Though, if the fundamentals are sound, and the company is a good price, I would definately consider. Will have to take a better look at Coal when I get some more free time. Budget coming up and I am being run off my feet!

 

[Wysiwyg]

If a market is 100% unpredictable, then why so does the Federal Government and RBA involve themselves in Fiscal and Monetary policy? Certainly a mix of numerous factors to predict turnarounds, and very complex, especially once factoring in time-lags to the equation (this especially true with Fiscal Policy), however, Fiscal and Monetary policy have prooven effective in Australia, I have studied this in depth, both trends, and impacts of time-lags, and no doubt, a market is always somewhat predictable. Not to the exact timing and magnititue, but an educated estimate is more reliable than a guess.

No worries Buff....I see where you are coming from.Despite my directness I enjoy this forum and contributions.

I have one Four letter word :bayer: that I should use more often though and that is .... K.I.S.S.

P.S. I t must be getting closer...more want it to happen.

 

[wayneL]

Yeah I had a bit of a squizz into Corn on the weekend, certainly up youre alley I would hazard a guess.

Gaining a sound forward view through fundamentals would have as much chance of success as the weatherman presenting a 3 month forecast . I guess thats the conundrum farmers are presented with each season, with the hazards speculated on the commodities futures.

You certainly aren't risk adverse Wayne..........perfect commodity for you!. Kudos

I bet you would like to speculate on banana's in cyclone season............. is thier such a thing as banana traders/market?

No bananas Lol

There is a sugar market... and orange juice. These can be affected by cyclones. Have a look at orange juice over the last two years, caused by shortages due to hurricanes in the US.

Re risk: Well I have a watchful eye on the underlying value of what I'm trading. I'll never do a Larry Williams and turn 10k into a mil in a year or whatever, but I'll never go down in flames either.

People in ag futures go out in spectacular fashion because they over-leverage themselves. They focus on margin rather than underlying face value and volatility.

This move has been locked for the value of $2,000 per contract so far. Imagine being on the wrong side of this with too many contracts. Megadeath LOL

Not this little black duck

 

[dhukka]

I agree, wise words, though I have to say, it is VERY hard to find solid, undervalued stocks at good prices at the moment.

I will take a good look at that tip of yours ROE on the wkend. Cheers.

Agreed B, very difficult to find undervalued companies in this market. I don't agree with ROE's selections in this thread but I definitely subscribe to his investment philosophy.

 

[Buffettology]

No worries Buff....I see where you are coming from.Despite my directness I enjoy this forum and contributions.

I have one Four letter word :bayer: that I should use more often though and that is .... K.I.S.S.

P.S. I t must be getting closer...more want it to happen.

Cheers.

It is no doubt getting closer, interest rates are expected to rise, there is a heap of cash out there and I cant remember which thread, but there was one with a picture of a house of cards made of credit, built on top of a rug, with a man at the door saying "im here to collect the rug". Thats how I see it. Rising inflation, rising (or at least expected IR), something has to give. Not to mention, the market is overvalued, and based on trends, this cannot be sustained. All it takes is for a bit of fear to creep in, and the market could suffer greatly. Ultimately it will rise, but a crash or at least large correction, IMHO is on its way. I would also bet it would be within 2 years, the sooner the better. The commodity boom and super contributions might push the timeframe of a correction out a bit, but it will happen. Worth the wait (I hope), at least for a long-term investor such as myself.

 

[ROE]

Agreed B, very difficult to find undervalued companies in this market. I don't agree with ROE's selections in this thread but I definitely subscribe to his investment philosophy.

That's cool everyone is entitle to their own research and opinion and everyone should be doing that before weighting or listening to other people

 

[Smurf1976]

Yep corn not looking to flash

Corn futures dropped more than 5% Friday -- the maximum price movement allowed for the contracts on the Chicago Board of Trade -- after the U.S. Department of Agriculture said it expects U.S. farmers to plant about 15% more corn acres than last year, as farmers take advantage of market demand for corn-based ethanol.

Which means they'll be planting less of something else unless we're about to see a signficant expansion of US agriculture overall in the next few months. Such rapid overall growth in total agriculture seems somewhat unlikely for an already developed industry in a highly developed country IMO.

 

[Freeballinginawetsuit]

Which means they'll be planting less of something else unless we're about to see a signficant expansion of US agriculture overall in the next few months. Such rapid overall growth in total agriculture seems somewhat unlikely for an already developed industry in a highly developed country IMO.

Maybe they didnt plant that much last year due to weather at seeding/ maybe they crop rotate and its corns turn this time.......maybe like Oz the minnows are getting swallowed and its simple economies of scale for the big boys...........I'm Srgt Shultz on Agriculture.

Ill leave it to Wayne's World, way out of my turf.

 

[TheRage]

That's cool everyone is entitle to their own research and opinion and everyone should be doing that before weighting or listening to other people

I think it takes a lot of courage these days to actually give specific examples on undervalued companies good on you. I have often wondered why there is not a thread on undervalued stocks like the breakout thread for the tech guys where these stocks are identified based on certain criteria.

 

[wayneL]

I think it takes a lot of courage these days to actually give specific examples on undervalued companies good on you. I have often wondered why there is not a thread on undervalued stocks like the breakout thread for the tech guys where these stocks are identified based on certain criteria.

That's a great idea TheRage!

You or somebody else into value investing should start one.

Cheers

 

[Buffettology]

That's a great idea TheRage!

You or somebody else into value investing should start one.

Cheers

I agree, the only trouble is, currently I cannot find an undervalued company (with sound fundamentals). At least, not in the areas I am looking (Coal was stated earlier, but thats not an area I have an overly large knowledge of).

 

[purple]

I agree, the only trouble is, currently I cannot find an undervalued company (with sound fundamentals).

undervalued...
difficult to find at this present moment. yep, probably the only way to find undervalued stocks is to wait for the crash....or pick up some penny stocks.

 

[Knobby22]

The trouble with market timing is no one ever get them correct..
look at it this way, you think bull run going to end, you pull out now
what if the doom day never came and it slowly chucking along maybe not 20-30% but 10% or 15% for the next few years or could be more
you could miss out.....on the other side if you are correct you can come back in at a lower price, so it's really 50%/50% chance

There are still some bargain stocks around if you look hard enough
I'm not too worry about bull and bear market.. I just look for good stock at bargain price and buy them with a margin of safety.. I let Bull and Bear fight it other out....

I'm still in 100% don't care if bull or bear run for the next 30 years...

I found one bargain last week and tomorrow I'm putting in another order for another bargain

If you miss the three worst crashes in you lifetime you will make 3 times the money. As a small investor you should aim to miss them.You do this buy selling out when fundamentals are too stretched and maybe do a bit of technical analysis.

 

[>Apocalypto<]

Yep corn not looking to flash

Corn futures dropped more than 5% Friday -- the maximum price movement allowed for the contracts on the Chicago Board of Trade -- after the U.S. Department of Agriculture said it expects U.S. farmers to plant about 15% more corn acres than last year, as farmers take advantage of market demand for corn-based ethanol.
The annual USDA prospective plantings survey showed farmers intending to use 90.45 million acres for corn, above the 88 million acres predicted by analysts.
The data set "the stage for a rebuilding of depleted corn inventories and a subsequent reduction in corn prices during the fall of 2007," David Driscoll, an analyst at Citigroup, said in a research note Friday.
'The USDA's Plantings report sets the stage for a rebuilding of depleted corn inventories and a subsequent reduction in corn prices during the fall of 2007.'
”” David Driscoll, Citigroup

Against this backdrop, corn for May delivery dropped 20 cents, or 5.1%, to settle at $3.74 1/2 a bushel in Chicago. Trading was halted at that level because that's the exchange's daily price move limit. The contract hasn't traded at a level that low since Jan. 10.
The intended plantings would be a record number, according to Darin Newsom, an analyst at Omaha, Nebraska-based DTN. "But it doesn't mean anything," he said. Other analysts say the figure would be the largest since the 1940s.
"Production is also expected to be a record (theoretically), but ending stocks should still drop," he said.
Tim Hannagan, a grains analyst at Alaron Trading, said it best: "Come Monday, the trade will say it is not what you plant, but wheat you grow."
"A drought from mid-June to July 25th -- key yield development time -- could reduce yields sharply enough to void the current bearish acreage number," he said in a note to clients.
At 90.45 million acres planted and about 81.4 million acres harvested, using the trend-line yield of 153.1, that would mean production of about 12.5 billion bushels, said Newsom in e-mailed comments.
"That would just cover, if not still lose ground to the expected growth in demand in 2007-2008 -- meaning ending stocks could decrease despite record production," he explained.
So overall, the plantings number could be viewed as bearish for corn prices, but the final number of plantings will depend heavily on weather in the Midwest, which has endured rainstorms that lead to less corn planting, he said.
Another thing for traders to consider is whether the plantings report will discourage some from actually planting as much corn as they earlier intended, said Todd Hultman, president of DailyFutures.com, in his Web site commentary.
The 2007 USDA survey also showed farmers planned 67.14 million acres of soybeans, down from 76.9 million planned in the previous survey. See the full report.

Freeballing,

Futures are a amazing thing!

they scare and fascinate me, they are my final frontier.

did you see the other month back where corn started that rally. they are just freaking mass power behind the sells and buys.

I spoke to a guy at Xpresstrade he told me they dont go limit up or down to often, as waynel said you don't want to be on the wrong side of a limit >SCARY<.