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Forget about support and resistance levels, retracements, entry points/stops, overbought/oversold, and all the other technical stuff, and just look at the picture. The stocks of the largest financial institutions on the planet, Citigroup (C), Bank of America (BAC), Wachovia (WB), Wells Fargo (WFC), JP Morgan Chase (JPM) – the institutions where money for our finance-based economy lives – are showing extreme distress, more so than at any other time including ’02, when the market was in free fall; and back then, debt derivatives (CDS) outstanding were a fraction of what exists today. What’s even more worrisome is that the CDS on these banks’ debt seem to be confirming such level of distress.
I understand if some readers might dismiss my concern (not belief yet – but definitely concern) that we may be on the verge of something worse than just a recession. But once you have dismissed my worries, please do yourself a favor: listen to Friday's video interview with UBS’ Art Cashin. For those unfamiliar with Cashin, he is the NYSE floor director for UBS, a man with decades of experience, and whose commentary consistently adds more to my financial education than just about any of the reams of research I read every day. Watch the whole thing (it’s only 3-4 minutes), but listen carefully to what he says from the 2:20 mark on.
Then store his words in your memory bank, and put your antennas up to hear if his worries are expressed in other circles. As I said at the beginning of this piece, crowds can take a “piece of the puzzle” and make it “the piece of the puzzle”. If Cashin’s fears start spreading, the real “fun” is still ahead of us.
I've thrown a few of these threads out there, it's time for the first 2008 version which roughly translates into .....
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__________________
At what point then is the approach of danger to be expected? I answer, if it ever reach us, it must spring up amongst us. It cannot come from abroad. If destruction be our lot, we must ourselves be its author and finisher. As a nation of freemen, we must live through all time, or die by suicide.
Bottom line - while you seem to get your warped jollies over reveling in the negative crap, I don't.... I would put the U.S. economy, with ALL it's ups and downs, over any other economy in the world over a period of time...
You enjoy picking out the momentary down-turns and not-so surprisingly shy away from the more prolonged periods of health...
That's actually from a few years ago, and it's over the top of course but it's a joy filled read.
82, the world is now connected, that means all the monkey games we taught everyone are all over the planet, it means that when the bill comes my kids and your kids get to pay it.
Facts are what facts are and they aint pretty.
So let me get this straight... The U.S. has been the most vibrant and powerful economy for over a century. But in a mere 8 years, Bush himself has undone it all?? Pardon me here as I just can't stop laughing...
C-Rad, I saw a report the other day that indicated the UK economy is beginning to slow. I am certain that this will also impact continental Europe which by country, is much less diversified and open as is the UK...
I fully realize that not only is the U.S. cycling downward, but other countries/regions just might be doing the same...
But again, we find ourselves in the debate of "how much"?? Will it be a total collapse of "epic, never before seen proportions"?? Will the entire world as we know completely come undone?? Will gov't lose their ability to govern? Some of these whackos need to come together with Speilberg! I just know there is a huge Hollywood hit waiting to be uncorked here!!!!
Oh come on 82 that's got nothing to do with a financial implosion.
We are a productive and generally decent people who work hard, that has zero to do with how badly they've messed up our financial system.
You sound like GWB, the economy is sound, bs it's not sound because it's built on a base of debt that is evaporating, like as in going bye bye.
Your chest thumping is like pointing out everything about a person is in great health, except of course their heart stopped working.
BTW I deleted that post because someone doctored the article, he said all those bearish things without of course mentioning concentration camps.
I don't blame Bush, this was done by Wall Street plain and simple, no one paid much attention cause it was all good but Bush isn't the problem, sorry to say it but you can't blame this on him.
__________________
At what point then is the approach of danger to be expected? I answer, if it ever reach us, it must spring up amongst us. It cannot come from abroad. If destruction be our lot, we must ourselves be its author and finisher. As a nation of freemen, we must live through all time, or die by suicide.
I don't blame Bush, this was done by Wall Street plain and simple, no one paid much attention cause it was all good but Bush isn't the problem, sorry to say it but you can't blame this on him.
Aw come on, can't we at least nail him for negligence?
i read a decent article recently that had a lot of greenspan snippets - he seems to have some concern over stagflation based upon the weakening dollar, combined with oil prices and the capital markets
stating that there are too many potential inflationary pressures on the marketplace that at some point rates will have to go up, which given the problems with lenders right now could lead to an increased cost of money to such a point it would hurt some businesses and escalate a slowdown
same article also mentioned the slowing in Europe and pointed out something I did not know, which is that china has been going through heavy inflation for the past decade and maybe their economic muscle is still a little more padded than they'd like everyone to believe
__________________
"Civilization is a limitless multiplication of unnecessary necessities."
Samuel Clemens
Oh come on 82 that's got nothing to do with a financial implosion.
We are a productive and generally decent people who work hard, that has zero to do with how badly they've messed up our financial system.
You sound like GWB, the economy is sound, bs it's not sound because it's built on a base of debt that is evaporating, like as in going bye bye.
Your chest thumping is like pointing out everything about a person is in great health, except of course their heart stopped working.
BTW I deleted that post because someone doctored the article, he said all those bearish things without of course mentioning concentration camps.
I don't blame Bush, this was done by Wall Street plain and simple, no one paid much attention cause it was all good but Bush isn't the problem, sorry to say it but you can't blame this on him.
Conrad, isn't it funny how you and I keep coming back to the same place? You see the situation as being a bleak and dark as it has ever been in the history of our country. You believe The Great Depression will look like a walk in the park compared to what is about to unfold...
I believe, as I have said all along, that economies have and always will be subjected to cycles... I believe, as I have said all along, that America will no doubt head into a slow period, perhaps even a recession (some believe we are already in a recession...). I often said that ALL speeding bullets must one day fall to the ground...
However, I refuse to take this to the level of hysteria you and others seem to want to go...
I'm certain we'll one day find out who's right and who's wrong. See ya on the other side comrade... At least I hope...
82 the last thing I want is a financial disaster but it's here.
I'm not sure it will look like a depression as in bread lines, the world is a complicated place, I'm frankly not sure what to expect at all.
I just know one thing, the current system is melting down, it's not maybe going to melt down it is going to melt down.
Now I guess the entire world could go for a redo, in fact that may be precisely what the world agrees on at some point but the fact is absent that things are going to suck majorly in financial terms.
This isn't a storm watch it's a warning, when house prices fall lenders lose money, when they fall a ton, lenders and financial institutions are bankrupt and when lenders don't lend people don't have money, etc etc etc.
It's obvious here what's going to happen, it's not obvious what the ramifications will be.
__________________
At what point then is the approach of danger to be expected? I answer, if it ever reach us, it must spring up amongst us. It cannot come from abroad. If destruction be our lot, we must ourselves be its author and finisher. As a nation of freemen, we must live through all time, or die by suicide.
So let me get this straight... The U.S. has been the most vibrant and powerful economy for over a century. But in a mere 8 years, Bush himself has undone it all?? Pardon me here as I just can't stop laughing...
C-Rad, I saw a report the other day that indicated the UK economy is beginning to slow. I am certain that this will also impact continental Europe which by country, is much less diversified and open as is the UK...
I fully realize that not only is the U.S. cycling downward, but other countries/regions just might be doing the same...
But again, we find ourselves in the debate of "how much"?? Will it be a total collapse of "epic, never before seen proportions"?? Will the entire world as we know completely come undone?? Will gov't lose their ability to govern? Some of these whackos need to come together with Speilberg! I just know there is a huge Hollywood hit waiting to be uncorked here!!!!
I don't think it's Bush' fault but globalization was not necessarily a good thing for the US economy as a whole. People thought offshoring was a panacea get engineers at 1/5 the going rate locally. They didn't stop to think that it's all relative, if you do it and your competitors do it too, the savings level off. Cutting prices to get business is only a short term answer but that's what US businesses have been doing for several years now. They're not innovating or growing the business, they're trying to cut costs to save their way into huge profits.
Meanwhile all those US workers displaced by offshoring have far less disposable incomes and aren't buying what these cost cutting businesses have to sell. It's a vicious cycle they didn't anticipate.
Add in the housing mess and things aren't very good. I don't think it's as bad as some people think but it COULD get that way.
Bottom line - while you seem to get your warped jollies over reveling in the negative crap, I don't.... I would put the U.S. economy, with ALL it's ups and downs, over any other economy in the world over a period of time...
You enjoy picking out the momentary down-turns and not-so surprisingly shy away from the more prolonged periods of health...
What a schmuck....
You'd take an economy with an 8 trillion dollar defecit? Even during the ups and downs, we are still going further and further into debt.
conrad, I have always thought Wall Street was the problem. Who is Wall Street? You do know they(whoever they are)can pick up a phone,call GM and tell them they must lay off 10% of their work force because their stocks are not moving.People for the past 7 or 8 years think wall street stock prices is the economy.
I don't think it's Bush' fault but globalization was not necessarily a good thing for the US economy as a whole. People thought offshoring was a panacea get engineers at 1/5 the going rate locally. They didn't stop to think that it's all relative, if you do it and your competitors do it too, the savings level off. Cutting prices to get business is only a short term answer but that's what US businesses have been doing for several years now. They're not innovating or growing the business, they're trying to cut costs to save their way into huge profits.
Meanwhile all those US workers displaced by offshoring have far less disposable incomes and aren't buying what these cost cutting businesses have to sell. It's a vicious cycle they didn't anticipate.
Add in the housing mess and things aren't very good. I don't think it's as bad as some people think but it COULD get that way.
My lord... Russ, "globalization" means much more than off-shoring... In fact, it has more to do with growing revenues, selling products & services outside the U.S., leveraging developing economies, enticing non-U.S. entities to do business here in the U.S.
Do you also believe "companies are not innovating or growing their business"?? Would you care to speak with the leaders of GE, Intel, 3M, Oracle, Cisco, ACS, etc....
What exactly are "cost-cutting businesses" and what are they selling? IMO, if business aren't working to improve margins, they will not be around very long... Are you really suggesting that ALL companies are "cost-cutting businesses"? Or are you suggesting that there are companies only in business to "cut costs"??
What sort of workers were "displaced" by off-shoring? What was their standard of purchasing power then versus now??
You'd take an economy with an 8 trillion dollar defecit? Even during the ups and downs, we are still going further and further into debt.
I think you mean an $8 trillion National Debt... which is actually just above $9 trillion I believe...
Our Budget Deficit is I believe is somewhere just north of $200billion...
Count me as one of those people who think, "it's that bad".
The gearing people it's the financial leverage that will wrench the real world into the ground.
We're about into the whirlpool now, once we go in, there's no comming out until the storm is over.
__________________
At what point then is the approach of danger to be expected? I answer, if it ever reach us, it must spring up amongst us. It cannot come from abroad. If destruction be our lot, we must ourselves be its author and finisher. As a nation of freemen, we must live through all time, or die by suicide.
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