Stall

[Sudaca]

The real problem here, ladies and gentlemen, is not seen in the stock market. This is, and has been the whole time, a credit issue.

 

The excesses in the credit markets make the Nasdaq Bubble look like Gary Coleman playing one-on-one with Shaquille O'Neal.

 

I have spoken to many people in the industry, and the only conversations worth listening to have been the ones on private personal lines, not on institutional recorded ones.

 

The situation is worse then I thought. It's much worse than any other financial crisis I have seen and traded through, and I have seen and traded every single one since Tequila in 94/95.

 

There is just no way that this going to resolve with rate cuts or anything akin, because let's face it, this is the end of the credit bubble.

 

What is happening with spread products and financial derivatives is the equivalent of the moment that dude ate that tulip bulb and made folks wake up to the sheer nonsense and madness..

 

Everyone is saying now that this time it's different because the risks have been hyper-disseminated and diversified throughout the universe, but I'm starting to believe that is a bad thing, since it only adds uncertainty as to the final effects.

 

Bounce or no bounce, the underlying support of the rise in many financial assets of the past years has changed dramatically, and I believe it has changed for good. Or at least for a very long time.

 

Even though I see some short term technical improvements in equity markets, and I still hold some dongs, I just can't envision a return to the the risk-taking environment of the recent past. If it did happen, I would completely lose faith in the hypothesis that human beings learn from past mistakes .

 

Ok, having said that, feel free to fade me.

[DrStool]

Yeah, I thought you Kali guys were all supposed to be so laid back.

 

Seems like there's a lot of latent hostility out there. :lol:

 

So, I will leave you tonight with the immortal words of market guru Rodney King:

 

Can't we all just get a long?

 

G'night!

[DrStool]

suds- Another winner! I am going to put your post on the WSE. Tanks for your always insightful....uh....

 

insights! yeah that's it!

 

insightful insights!

[martialcomp]

I personally don't know what the market is going to do right now.

 

LeeWhee has been pretty accurate lately. He says we are in no mans land. Could go up, could go down.

 

Tech has rallied more than everything else in the last week.

 

The mortgage mess is going to take years to unwind. It is surprising how long it took for the housing ponzi scheme to begin to unravel.

 

I am sticking with my opinion that January of 2009 is a good time to start looking for a home.

 

Here is an article that was in the San Diego Union Tribune last Saturday.

 

http://www.signonsandiego.com/uniontrib/20..._1n18loans.html

 

"As more lenders collapse, the skittish survivors are continually raising their rates and changing the rules for getting a loan as they scramble to stay alive.

 

Mortgage companies have been rocked by a liquidity crisis that started in weak-credit subprime loans but has spread to more conventional products, such as so-called jumbo loans of $417,000 and up that make up a large portion of mortgages in Southern California and other high-priced areas."

 

 

For those that didn't listen to the newest podcast, it should be required listening in todays environment.

[crazy_ate]

Bigger and bigger bubbles are being blown all the time.

 

China surpassed 5,100 this evening, thereby eclipsing the Nasdaq 1999-2000 run in a compressed timeframe.

 

Never say never....

 

602677[/snapback]

 

 

That's it. I am 1000% short....or teets short as some would say.....

 

[1] Fading WNDY has been the most profitable trade all year (NEW CENTURY )

 

[2] 5,000 on the Ching-Chong = 5,000 on the NazDuk = U-fuked = Sell

 

Run Forest, run!!!!

 

[snorkels4]

China has been around for 5000 years and the USA a little over 200, so it pays to be a little humble when looking at such a complex society

602670[/snapback]

 

That's some ridiculously tortured logic. You draw a magic line around America and disregard the entire history from which it is derived (even including the influence of the aboriginal cultures, and the disparate European colonies who are themselves heavily influenced not only by Greek/Roman tradition but even India, China and the Middle East). On the other hand you claim that China is a 5000 year old civilization as if such a cohesive whole could exist even in today's totalitarian technology-backed central statist fantasy, that's some magic crayon.

602684[/snapback]

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thanks

[martialcomp]

Great rant Suduca.

 

You are correct. The credit bubble looks to be toast. There is no way to continue to extend credit if no one wants to hold the debt.

 

Our economy relies on credit expansion every month to continue growing.

 

That same level of credit is no longer available.

 

Consumers haven't saved anything in years so there is no savings to fall back on.

 

http://research.stlouisfed.org/fred2/series/PSAVERT/

 

It looks like the end game for the FOMC. They are actually better off letting the housing market crater ASAP(wash, rinse) so they can start a new credit bubble all over again.

[Jimi]

Jeez, look at that spread. and it's getting wider. 

 

Serious problems here in Quebec with one major institution waiting for $500 million in ABCP redemption. The securities have matured, but the cash has not been forthcoming.

602681[/snapback]

 

 

The information has been reported in the Canadian media. However, the stories have the numbers wrong as to the magnitude of the losses. For example, no one is reporting the $500 million figure owed to the one institution that I know of. Generally speaking, the problem is being minimized.

 

One big bank is going to make good on $2 billion and hold the paper and a rescue package has been approved, but the teachers pension fund is going to sue. The rescue converts short term money market ABCP to long term debt.

 

Lotta good that's going to do.

 

Slowly buy surely all that "liquidity" that everyone thought was around will be proven to be illusory. All funny money. Exposed.

602685[/snapback]

My broadband provider is Comcast Cable. Today, I got fed up with some erratic performance. So, I got on the horn to them.

 

I reached a guy at a phone bank in Winnipeg. Friendly enough, especially when he said, "down," in "Power down your cable modem."

 

 

Anyway, he was doing some stuff, waiting for the computer on his end to chug through some diagnostic thing, and he said things had been weird today. He said that everyone at Comcast were supposed to get direct deposit today, but that something screwy had happened, and no one had got direct deposit.

 

I asked, "No one in Winnipeg, or no one at Comcast." He said, Comcast, but wasn't sure, and wasn't sure of any explanation why.

 

Commercial paper market is used to fund working capital needs, as I understand it. If that market is seizing up, we may want to be on the look out for rolling payroll brownouts.

[Whadda I Do Whadda I Do]

Did you ask which bank payroll is drawn on?

[Jimi]

I didn't.

 

But, as if he were some sort of apotheosis for the vulnerable daisy-chain of credit-based consumption, he did volunteer that his failed deposit screwed up a car payment he needed to make....

[Whadda I Do Whadda I Do]

I don't think China knows how to act with a large middle class so the government will use the pseudo markets to separate them from their money. Sound familiar?

 

I worry more about the Red Chinese military than anything else.

 

LW has done a fine job charting their non-market. Like it or not 1.32billion phones is a lot of money.

[Whadda I Do Whadda I Do]

I didn't.

 

But, as if he were some sort of apotheosis for the vulnerable daisy-chain of credit-based consumption, he did volunteer that his failed deposit screwed up a car payment he needed to make....

602699[/snapback]

I bet him and everyone else are upset. Here in the US payroll is sacred, ya just don't 'not pay' someone.

[Whadda I Do Whadda I Do]

Distrust, liquidating or both?

[prancing_cow]

The real problem here, ladies and gentlemen, is not seen in the stock market.  This is, and has been the whole time, a credit issue.

 

The excesses in the credit markets make the Nasdaq Bubble look like Gary Coleman playing one-on-one with Shaquille O'Neal.

 

I have spoken to many people in the industry, and the only conversations worth listening to have been the ones on private personal lines, not on institutional recorded ones.

 

The situation is worse then I thought.  It's much worse than any other financial crisis I have seen and traded through, and I have seen and traded every single one since Tequila in 94/95.

 

There is just no way that this going to resolve with rate cuts or anything akin, because let's face it, this is the end of the credit bubble.

 

What is happening with spread products and financial derivatives is the equivalent of the moment that dude ate that tulip bulb  and made folks wake up to the sheer nonsense and madness..

 

Everyone is saying now that this time it's different because the risks have been hyper-disseminated and diversified throughout the universe, but I'm starting to believe that is a bad thing, since it only adds uncertainty as to the final effects.

 

Bounce or no bounce, the underlying support of the rise in many financial assets of the past years has changed dramatically, and I believe it has changed for good.  Or at least for a very long time.

 

Even though I see some short term technical improvements in equity markets, and I still hold some dongs, I just can't envision a return to the the risk-taking  environment of the recent past.  If it did happen, I would completely lose faith in the hypothesis that human beings learn from past mistakes .

 

Ok, having said that, feel free to fade me. 

602688[/snapback]

 

so even a rate cut will not help? J Cramer will be really, really disappointed.

Seems like all those bozos think that a simple cut will remedy everything - stock market a for very short time it might.

[linrom]

M3 has disappeared down the black hole-- possibly cleverly engineered by Maestro Greenspan himself via the real estate mortgage Ponzi scheme ---as a going away gift to pierce the debt bubble and fiat excesses. But, why let the secret out of the bottle since no one is going to believe it anyway?

 

Some folks wonder "where has all the liquidity gone, while others wonder about credit spreads? .........M3 has vanished.

 

Maybe Greenspan is responsible for the debt bubble, but, no one mentions how G.W Bush blew a hole in the Federal budget by tax giveaways, thus forcing Greenspan to lower rates to stimulate the economy post 9/11. Meanwhile a madman in Japan keeps printing money to make Japanese exports price competitive, while blowing up the rest of the world in a giant debt scam. There is no credit problem, there is a DEBT problem and M3 has vanished.