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Institutional Nutcases Tapped Out


DrStool

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Posted

Seamus,

 

Here at the stool, we had a long thread back in Dec01' on this. (i was under a different name then)

 

It started out by me opening up here and discussing the anxiety i was going through, telling people about the comming fall and being ignored.

 

We decided it was better to leave well enough alone and do what was best for us as individuals.

 

I still feel that way, although, i have not shut up yet. :grin:

 

Mousey,

 

Tanks for the accolade. I heard the other day, that there are 14,000 funds on morningstars database. If that is not a contrarian argument for a continued decline, i don't know what is.

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Posted
i think it is more and more likely that there will be the day when the fed says: "damn it, this makes no sense anymore, let the stocks die!"

sure, why not? The FED has already decided to let the dollar die for obvious reasons. Perhaps if they stop forcing the market's hand by propping is up then the Great Bear can finally play out and eventually give birth to a newborn secular bull market. The FED is aware as to why the NOKKIE is stuck in a slow grinding secular bear and a major factor was the amount of BOJ intervention after many years. The sooner the better i sayz!

Posted

TE -

Agreed, I have friends who are quite successful in the commodities business (especially) who make $ hand over fist and don't care about other people's views. It is my family I am most concerned with...and the fact that they are droned kills me. I am potentially setting up a fund in the near future and meeting with one of the key benefactors in the next couple weeks. I have no problem in quantifying my investment approach. :D

Guest BEARDRECH
Posted
TE -

Agreed, I have friends who are quite successful in the commodities business (especially) who make $ hand over fist and don't care about other people's views. It is my family I am most concerned with...and the fact that they are droned kills me. I am potentially setting up a fund in the near future and meeting with one of the key benefactors in the next couple weeks. I have no problem in quantifying my investment approach. :D

seamus

theres only one thing left to do:-gather ye many animals two of each kind; and then build yourself an antediluvian chriscraft about 400 cubits long--and then?and then? what??

beardrech :ph34r: :cry: :P

Posted
I'm in the crash camp somewhat.  If it was ever gonna happen, it seems like now would be the time.

 

In no particular order:  

 

1.  You've got geopolitical instability -- "event risk" is high

 

2.  Many cycles are heading down with force in unison, including cycles longer than the 10-13 week

 

3.  Counts seem to line up for a 3rd wave in Elliot (or a C wave, same thing)

 

4.  Lotsa TA indicators (i.e.- MACD) have been "coiling" for months, indicating vast potential energy building, and have now broken to the downside.  Large price triangle also broken to the downside (as well as large H&S topping pattern)

 

5.  Dollar's dropping like a rock, foreign investors are pulling out in droves

 

6.  Ma and Pa investor are at the end of their collective rope, and I think they're itchin' to pull the sell trigger like at no other time in this bear

 

7.  Mutual fund cash at record lows (as just posted)

 

8.  Consumer debt levels at record highs, savings at record lows

 

9.  P/E values are still astronomically high

 

If ever the time was ripe for a crash, this is it, imo.

 

I didn't add this one to the list initially, as I can't prove it empirically, but I suppose it "bears" sharing:

 

10. Who's short at this point? I suspect that many "big" bears (hedge funds, etc.) are much more cautious about being short right now after getting burned by the 20% rallies we've experienced the past couple years. Additionally, we have the possibility of Saddam's peaceful exile, or (somewhat conversely) the much-anticipated "war rally." Other than the high RYDEX numbers (which could be explained by large players hedging), I suspect there are few shorts right now to support the market. Are most waiting for the big bounce to get in, now that we've finally broken out of the 3 month trading range? Maybe it never comes?

 

This is all purely speculative on my part, but I think most bears missed the downmove so far as they were waiting for confirmation before shorting and the market blew by them... and now they're waiting for the bounce, so the market may blow by again. Plus there still seems to be a lot of skepticism about a downmove, even from many bears. How many are actually participating?

 

Again, all purely speculative and FWIW.

Posted

As I speculated in today's Anals, evidence suggests that the Fed is beginning the move to support the dollar. The implications of further collapse and greater flow of capital out of US markets are forcing their hand.

Posted

In a first step, yes, the fed will try cuantitative rationing, without increasing short term rates. Will the fed succeed? The problem is, being the renmimbi in a fixed change with the dollar, and being China the main culprit of U.S. trade deficit, in order to achieve equilibrium, the dollar must fall monster-size against the euro and the yen (even this won?t do. Try to drive a a Ford F-150 through Florence) .

 

Really, only a big recession in U.S can stabilize the current acount deficit, and mainly, curtailing U.S. imports. This is what european markets are ?discounting? now. Now we?ll have renewed stress in local and international credit markets (see the fall or the Brazilian real against the dollar last Friday), a run on the dollar, the stock market in free fall and the fed paralyzed.

 

Hurry up, Mr Bush, or maybe you will be unable to start the war.

Posted

Just another ramble while I await the get into a stuper bowl...

 

If you take the low of October, the high of 2 DEC, the low of 31 DEC, and the high of this month, you would say we DO bounce at the 13 day in a Bullish Gartley Reversal.

Patterns can fail...but i thought it fun to note. :unsure:

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