Username or Email Address
Do you already have an account?
Forgot your password?
  • Log in or Sign up

    VWVortex


    Page 3 of 224 FirstFirst 12345671353103 ... LastLast
    Results 71 to 105 of 7807

    Thread: Subprime Meltdown, the US Housing Market & the Direction of the US Economy in 2009 and 2010

    1. Banned
      Join Date
      Nov 20th, 2004
      Posts
      4,258
      01-09-2008 02:04 PM #71
      Quote, originally posted by 1Point8TDan »
      So when will the stock market collapse? I already took 75% of my money out of my stock brokerage firm.


      Moving away from the absolute terms; which tend to inflame the argument, we can look at the cautionary tails unfolding in the market right now.

      We are due for a large correction in the market mainly due to all the recessionary signs. Fed will continue to do what they do best but there is a limit to interest rate campaign. We now have deflating home equities. Even with lower interest rate, fewer people will qualify for loans let alone access to equities in their home. Spending will shrink, easy but expensive debt such as credit card debt will explode even further as earnings will stagnate. Mixing all this with higher unemployment rate, higher energy price, rising inflation, disappearing dividend and etc, we may not have to wonder what will be subsequent economic data and following market reactions will be.

      Smart people already have consolidated their shares or at least moved it far away from financial stocks. From institutional to private investors, action speaks louder than words.E*Trade just unloaded $3 billion in mortgage-backed securities and municipal bonds in order to cut perceived risk. I mean it is too obvious but better late than never right? and BTW, MBIA is cutting dividend by 62% to raise $1 bill in capital. Problem? They do not know where the loss is going to go, they have no idea. No bond insurer is set up to handle this type of loss in the market.

      So when will the market collapse? I am not sure exactly when. But I am preparing for the worse rather than hoping that things will get better somehow.


      Modified by marzen at 10:05 AM 1-9-2008


    2. Banned
      Join Date
      Dec 17th, 2007
      Posts
      39
      01-09-2008 02:38 PM #72
      Quote, originally posted by jnm1point8t »

      anyone have a crystal ball?

      Look no further than the DJIA in Gold, the crash has been going on for quite a few years.


    3. 01-09-2008 02:53 PM #73
      1st quarter will be down. We're going to get a huge cash injection so the market will rally in terms of the dollar, but don't forget to factor in inflation. Its all about buying power.

    4. Member jnm2.0t's Avatar
      Join Date
      Oct 2nd, 2005
      Location
      Sunnyvale CA
      Posts
      18,227
      Vehicles
      List your car(s) owned here
      01-09-2008 03:24 PM #74
      Quote, originally posted by Eloi »

      Look no further than the DJIA in Gold, the crash has been going on for quite a few years.

      i dont think he was asking when the market will tank vs gold.

      I'm just a regular Joe, with a regular job. I'm your average white, suburbanite slob.

      Quote Originally Posted by Rabbit5GTI
      You have cornered the entire 'I hate Ford Fusions' market around here

    5. Member 90Carat's Avatar
      Join Date
      Sep 20th, 2005
      Location
      Broomfield
      Posts
      2,056
      Vehicles
      '04 Passat 1.8t 4mo Wagon, '06 Outback R Sedan, '03 Denali, '64 356
      01-09-2008 04:26 PM #75
      Quote, originally posted by Eloi »

      Look no further than the DJIA in Gold, the crash has been going on for quite a few years.

      Highly misleading graph. Gold was at record lows in 2000-2001.


    6. Banned
      Join Date
      Dec 17th, 2007
      Posts
      39
      01-09-2008 04:43 PM #76
      Quote, originally posted by jnm1point8t »

      i dont think he was asking when the market will tank vs gold.

      It shows you that the market is going up in dollar terms, but dropping in terms of commodities ie. value. You can go to stockcharts dot com and compare the DJIA to other comodities like Silver, Oil, Wheat, Corn and you will see the same trend.


    7. 01-09-2008 05:04 PM #77
      Quote, originally posted by Eloi »

      It shows you that the market is going up in dollar terms, but dropping in terms of commodities ie. value. You can go to stockcharts dot com and compare the DJIA to other comodities like Silver, Oil, Wheat, Corn and you will see the same trend.

      Can you produce the same chart, but instead of Gold, compare the market to Premium gasoline, Craft Beer and building supplies?


    8. 01-09-2008 05:32 PM #78
      Quote, originally posted by marzen »

      Smart people already have consolidated their shares or at least moved it far away from financial stocks.

      Modified by marzen at 10:05 AM 1-9-2008

      Mind sharing how you accomplished this? I know nothing about the market and investing just curious. Thanks


    9. Banned
      Join Date
      Nov 20th, 2004
      Posts
      4,258
      01-09-2008 09:35 PM #79
      Quote, originally posted by 8valver »

      Mind sharing how you accomplished this? I know nothing about the market and investing just curious. Thanks

      PM me your specific question(s).


    10. Senior Member beng's Avatar
      Join Date
      May 13th, 2002
      Location
      NutVegas, NJ
      Posts
      30,149
      Vehicles
      Family Truckster
      01-10-2008 10:20 AM #80
      We've had some pretty soft Decemeber sales numbers...

      Odds of a 50bp cut are looking pretty good...

      Here's on interesting article on lengths Lennar has had to go to move inventory.

      Quote, originally posted by bloomberg »
      Lennar's New Homes Fetch 60% Less as U.S. Market Slump Deepens


      By Bob Ivry
      Jan. 10 (Bloomberg) -- Lennar Corp.'s November sale of
      11,000 properties in eight states set a price that may mark the
      bottom for the U.S. housing market: 40 cents on the dollar.
      That's how much Morgan Stanley Real Estate paid for an 80
      percent stake in the 32 communities, 60 percent less than the
      price at which the properties were valued just two months
      earlier. That's also what some investors say they would pay for
      distressed land, condominiums, homes and whole developments,
      whether it's now or later this year.
      ``If you're an opportunistic buyer with enough cash and
      credit, it will be one of the best opportunities for acquiring
      property in our lifetime,'' said Jack McCabe, whose McCabe
      Research & Consulting LLC in Deerfield Beach, Florida, advises
      hedge funds and other investors on real estate sales.
      As the U.S. housing slump drags into its third year,
      sellers will start cutting prices as much as it takes to find
      buyers, said Marcel Arsenault, a self-described ``vulture
      investor.'' Properties will be available to buyers with the
      financial strength to ride out the slide. Now that a price has
      been set, all that's left is the waiting.
      Arsenault, based in Broomfield, Colorado, bought real
      estate during the savings-and-loan collapse of the early 1990s.
      He said he has put together a $200 million fund he expects to
      expand to $800 million this year to buy distressed condos.

      `Eroding by the Minute'

      ``We're watching Denver, Phoenix, Austin and Tucson, but
      South Florida is our principal focus,'' said Arsenault, 60. ``If
      you're a vulture, Florida has more carrion. This stuff is lying
      on the ground. It's lost life. Some of the stuff in Phoenix is
      still breathing. Perhaps not for long.''
      Arsenault said he and his three partners may buy a block of
      about 50 new, unsold condominiums in Orlando, Florida. They have
      a price in mind and they're willing to wait until they get it:
      40 cents on the dollar.
      ``There's a risk to buying too early in the downturn, but
      buying too expensive is our biggest pitfall,'' he said.
      Companies such as Miami-based Lennar, the biggest U.S.
      homebuilder by revenue, need to generate cash to make up for
      slowing home sales, especially this time of year, said Vicki
      Bryan, a Friendswood, Texas-based senior high-yield debt analyst
      for Gimme Credit LLC.
      ``They sold land at 40 cents on the dollar and they're
      happy to get it,'' Bryan said. ``The value of land is eroding by
      the minute.''
      1 3 4 5 7 8 8 9 10 15 16 23 32 37 42 44 49

      "I don't know half of you half as well as I should like; and I like less than half of you half as well as you deserve"

    11. 01-10-2008 10:58 AM #81
      Quote, originally posted by marzen »


      Moving away from the absolute terms; which tend to inflame the argument, we can look at the cautionary tails unfolding in the market right now.

      We are due for a large correction in the market mainly due to all the recessionary signs. Fed will continue to do what they do best but there is a limit to interest rate campaign. We now have deflating home equities. Even with lower interest rate, fewer people will qualify for loans let alone access to equities in their home. Spending will shrink, easy but expensive debt such as credit card debt will explode even further as earnings will stagnate. Mixing all this with higher unemployment rate, higher energy price, rising inflation, disappearing dividend and etc, we may not have to wonder what will be subsequent economic data and following market reactions will be.

      Smart people already have consolidated their shares or at least moved it far away from financial stocks. From institutional to private investors, action speaks louder than words.E*Trade just unloaded $3 billion in mortgage-backed securities and municipal bonds in order to cut perceived risk. I mean it is too obvious but better late than never right? and BTW, MBIA is cutting dividend by 62% to raise $1 bill in capital. Problem? They do not know where the loss is going to go, they have no idea. No bond insurer is set up to handle this type of loss in the market.

      So when will the market collapse? I am not sure exactly when. But I am preparing for the worse rather than hoping that things will get better somehow.


      Modified by marzen at 10:05 AM 1-9-2008


      Doooooom and glooooom.

      I hope you are stocking up on canned food, water, and ammunition then as well. The market is going through a correction yes, but almost every.single.analyst has said the stock market has bottomed out and is now looking at a 2-5% growth over the next 12 months. It is not good, but it is certainly not a collapse. Markets nowadays are so global that they are not entirely dependent on their home country.

      When you say "consolidated shares" what exactly do you mean? How is consolidating anything going to help? I can slap up one chart after another that will consistently show what happens when people pull out of the market when they get a downturn and then get back in later, and it is not good. There is a reason why the market averages about an 11% return over the life of it. up 20% a few years, then an occasional downturn for a few, its the law of averages. It is bound to happen, and if you think you are going to time it, good luck. People far smarter, far more educated and experienced, and with a great many tools at their disposal are trying to do the exact same thing.

      You also realize how incredibly stupid it sounds when you talk about people dumping Muni's, right? You realize that 4 or 5 muni's have *ever* defaulted.... E V E R. Almost all of them are insured anyway. Or are you talking about a general collapse of the global reinsurance sector? That would be cute....


    12. Senior Member beng's Avatar
      Join Date
      May 13th, 2002
      Location
      NutVegas, NJ
      Posts
      30,149
      Vehicles
      Family Truckster
      01-10-2008 11:55 AM #82
      Quote, originally posted by dubatwork2 »
      The market is going through a correction yes, but almost every.single.analyst has said the stock market has bottomed out and is now looking at a 2-5% growth over the next 12 months.

      2-5% growth in equity markets? That's pretty terrible. Maybe not a collapse, but that's REALLY weak returns for the perceived risk to your capital.

      1 3 4 5 7 8 8 9 10 15 16 23 32 37 42 44 49

      "I don't know half of you half as well as I should like; and I like less than half of you half as well as you deserve"

    13. Member jnm2.0t's Avatar
      Join Date
      Oct 2nd, 2005
      Location
      Sunnyvale CA
      Posts
      18,227
      Vehicles
      List your car(s) owned here
      01-10-2008 11:58 AM #83
      i agree beng... probably not the best place for your money overall, but as a gauge of the economy, 2-5% with all that has happened in the housing market would be ok by me.
      I'm just a regular Joe, with a regular job. I'm your average white, suburbanite slob.

      Quote Originally Posted by Rabbit5GTI
      You have cornered the entire 'I hate Ford Fusions' market around here

    14. Senior Member beng's Avatar
      Join Date
      May 13th, 2002
      Location
      NutVegas, NJ
      Posts
      30,149
      Vehicles
      Family Truckster
      01-10-2008 12:03 PM #84
      Oh... and one more thing...

      FINALLY... I see the term stagflation in a headline. I've been saying for months that this is the territory we've entered.

      Soaring commodity costs coupled with stagnant or negative growth.... this echoes the mid seveties, with one exception...global energy demand is strong enough to keep inflationary pressures up EVEN after stagnation or deflation of growth.

      ...and a note to Bernanke: In a stagflationary environment, monetary policy (one way or the other) tends to exacerbate the problem.

      Return of Supply Side Economics?

      Here's the article I'm referring to:

      Quote, originally posted by bloomberg »
      Stagflation Threatens U.S., Barclays Says:

      By Mark Gilbert
      Jan. 10 (Bloomberg) -- The U.S. economy risks stagnant
      growth combined with accelerating inflation, a condition known as
      stagflation, according to Tim Bond, head of global asset
      allocation at Barclays Capital in London.
      ``The current state of the U.S. economy almost merits the
      term stagflation, in the sense that growth is a long way below
      trend, while inflation is a long way above,'' Bond wrote in a
      research report this week. ``Inflation has risen above 4 percent,
      with little sign from the wholesale commodity, agricultural and
      energy markets of much relaxation in these driving factors.''
      Gold reached a
      record $891.70 an ounce yesterday, while corn rose to an 11-year high. The UBS/Bloomberg Constant
      Maturity Commodity Index climbed to a record yesterday after
      gaining by 22 percent last year.
      ``It is not U.S. demand that is mostly responsible for the
      move up in global inflationary pressures, but growth in Asia, the
      oil producing economies and the developing world,'' Bond wrote.
      ``So a U.S. slowdown can continue to unroll in the context of
      still-high commodity and energy prices. This is very different to
      the post-1970s experience, when a U.S. slowdown was usually
      enough to change the supply-demand balance in the natural
      resources markets and ease inflationary pressures.''

      1 3 4 5 7 8 8 9 10 15 16 23 32 37 42 44 49

      "I don't know half of you half as well as I should like; and I like less than half of you half as well as you deserve"

    15. Banned
      Join Date
      Nov 20th, 2004
      Posts
      4,258
      01-10-2008 12:22 PM #85
      Quote, originally posted by beng »
      Oh... and one more thing...

      FINALLY... I see the term stagflation in a headline. I've been saying for months that this is the territory we've entered.

      Soaring commodity costs coupled with stagnant or negative growth.... this echoes the mid seveties, with one exception...global energy demand is strong enough to keep inflationary pressures up EVEN after stagnation or deflation of growth.

      ...and a note to Bernanke: In a stagflationary environment, monetary policy (one way or the other) tends to exacerbate the problem.

      Return of Supply Side Economics?

      Here's the article I'm referring to:

      Stagnation + Inflation, yes sir that is exactly where we are at right now.


    16. 01-10-2008 12:36 PM #86
      Quote, originally posted by beng »

      2-5% growth in equity markets? That's pretty terrible. Maybe not a collapse, but that's REALLY weak returns for the perceived risk to your capital.

      Oh, I agree, like I said. However that is not to say a good portfolio will not signifigantly beat that, that is just the DJIA/SP etc. I am just trying to point out the fact that it is not a total collapse.


    17. Member 90Carat's Avatar
      Join Date
      Sep 20th, 2005
      Location
      Broomfield
      Posts
      2,056
      Vehicles
      '04 Passat 1.8t 4mo Wagon, '06 Outback R Sedan, '03 Denali, '64 356
      01-10-2008 12:39 PM #87
      Quote, originally posted by beng »
      ..snip..

      ...and a note to Bernanke: In a stagflationary environment, monetary policy (one way or the other) tends to exacerbate the problem.

      ..

      QFT. I'm concerned about constantly dropping rate, and cash infusions, to keep things going.

      Additionally:

      "There are a majority of people who are relying on credit for their basic living expenses and that is what we are seeing right now. We are seeing people use credit as an extension of their income rather than that tool of convenience that it was meant to be," said Kim McGrigg with Consumer Counseling Services.

      Not good at all.


      Modified by 90Carat at 8:46 AM 1-10-2008


    18. Banned
      Join Date
      Nov 20th, 2004
      Posts
      4,258
      01-10-2008 12:42 PM #88
      Quote, originally posted by dubatwork2 »

      Oh, I agree, like I said. However that is not to say a good portfolio will not signifigantly beat that, that is just the DJIA/SP etc. I am just trying to point out the fact that it is not a total collapse.

      And that good portfolio should be as far away from financial stocks as possible. Consolidating shares means, moving it to other means to protect your assets such as precious metals.

      E*trade sold $3bilion in mortgage backed securities and municipal bonds. Perhaps, you should call them up and yell at them as to why they are making such a stupid decision.

      Last but not least, welcome to the thread.


    19. Senior Member beng's Avatar
      Join Date
      May 13th, 2002
      Location
      NutVegas, NJ
      Posts
      30,149
      Vehicles
      Family Truckster
      01-10-2008 12:45 PM #89
      Question...

      What does QFT mean?

      It's not in my acronym vocabulary.

      1 3 4 5 7 8 8 9 10 15 16 23 32 37 42 44 49

      "I don't know half of you half as well as I should like; and I like less than half of you half as well as you deserve"

    20. Banned
      Join Date
      Nov 20th, 2004
      Posts
      4,258
      01-10-2008 12:46 PM #90
      Quote, originally posted by 90Carat »

      QFT. I'm concerned about constantly dropping rate, and cash infusions, to keep things going.


      And you are concerned rightfully so.


    21. 01-10-2008 12:50 PM #91
      Quote, originally posted by marzen »

      And that good portfolio should be as far away from financial stocks as possible. Consolidating shares means, moving it to other means to protect your assets such as precious metals.

      E*trade sold $3bilion in mortgage backed securities and municipal bonds. Perhaps, you should call them up and yell at them as to why they are making such a stupid decision.

      Last but not least, welcome to the thread.

      That is not consolidating at all, that is re-allocating. Big difference, and the exact opposite of your intended meaning. Consolidating is going towards something and not away, or concentrating the position.

      I love when people think since Gold/Silver/Plat is up that its a good investment. You realize that the price of those metals has actually been almost identical to inflation, if not a bit under historically averaged? If you want to secure your money, insured bonds or cd's are probably the best, short of annuities and garunteed contracts.

      What E-trade does is it's business, but selling Muni's as relation to the CDO crunch is actually unrelated entirely. CDO's and muni bonds have nothing in common other than the fact that they are debt instruments. Like I said before, tell me how risky a muni is when out of the tens of thousands before, only 4-5 have ever defaulted. Then tell me the risk when they are insured bonds.

      The only way your statements hold water to muni's is if you think the local governments issuing these bonds are going to be bankrupted all at once, in similar fashion, and the insurance companies underwriting them as well.

      At that point, all you will need is food, water, ammo, and fuel anyway.


    22. Global Moderator iThread's Avatar
      Join Date
      Sep 27th, 2005
      Location
      Bay Area, California
      Posts
      19,419
      Vehicles
      67 Bug, 92 Miata, 12 Golf R.
      01-10-2008 01:30 PM #92
      Quote, originally posted by beng »
      Question...

      What does QFT mean?

      It's not in my acronym vocabulary.

      Quoted For Ttuth


    23. Senior Member beng's Avatar
      Join Date
      May 13th, 2002
      Location
      NutVegas, NJ
      Posts
      30,149
      Vehicles
      Family Truckster
      01-10-2008 02:00 PM #93
      Quote, originally posted by dubatwork2 »

      I love when people think since Gold/Silver/Plat is up that its a good investment. You realize that the price of those metals has actually been almost identical to inflation, if not a bit under historically averaged? If you want to secure your money, insured bonds or cd's are probably the best, short of annuities and garunteed contracts.

      Agreed. ...and well put.

      ...the only thing that drives people to precious metals is the perception of scarcity and thus safety for their assets in times of market stress.

      Quote, originally posted by dubatwork2 »

      What E-trade does is it's business, but selling Muni's as relation to the CDO crunch is actually unrelated entirely. CDO's and muni bonds have nothing in common other than the fact that they are debt instruments. Like I said before, tell me how risky a muni is when out of the tens of thousands before, only 4-5 have ever defaulted. Then tell me the risk when they are insured bonds..

      Another valid point. Orange County FTW!

      What sector do you work in dubatwork?

      1 3 4 5 7 8 8 9 10 15 16 23 32 37 42 44 49

      "I don't know half of you half as well as I should like; and I like less than half of you half as well as you deserve"

    24. 01-10-2008 02:08 PM #94
      Not that this really matters but in the stagflation article that beng posted it mentioned that corn is at an 11 year high. One of my clients who is a cheese manufacturer mentioned that due to the high cost of corn dairy cows are being feed chocolate. (Isn't that where chocolate milk comes from? )


      Modified by ImRollin at 10:09 AM 1-10-2008

    25. Banned
      Join Date
      Dec 17th, 2007
      Posts
      39
      01-10-2008 02:56 PM #95
      Quote, originally posted by dubatwork2 »


      The only way your statements hold water to muni's is if you think the local governments issuing these bonds are going to be bankrupted all at once, in similar fashion, and the insurance companies underwriting them as well.

      At that point, all you will need is food, water, ammo, and fuel anyway.

      I think I stumbled into the Vortex survivalist forum.


    26. 01-10-2008 03:34 PM #96
      Hehe, yea Beng, Orange County.... famous for it.

      Obviously we both work in finance, I am an FA for a major. PM if you want more details.


    27. 01-10-2008 03:35 PM #97
      Quote, originally posted by Eloi »

      I think I stumbled into the Vortex survivalist forum.

      Nono, not at all.

      All I am saying is that Marzen apparently believes that all forms of bonds are going to collapse as well as their insuring agencies, you are *pretty* much looking at the failure of all global economies at once, at which point... its thunderdome.


    28. Member MofoG23's Avatar
      Join Date
      May 22nd, 2004
      Location
      Pittsburgh, PA
      Posts
      852
      Vehicles
      2010 CW 4dr GTI
      01-10-2008 03:37 PM #98
      Quote, originally posted by dubatwork3 »

      Nono, not at all.

      All I am saying is that Marzen apparently believes that all forms of bonds are going to collapse as well as their insuring agencies, you are *pretty* much looking at the failure of all global economies at once, at which point... its thunderdome.

      Eloi is in the same boat. He believes our economy is going to crash and we will be living our life as described in the novel 1984 .



      Modified by MofoG23 at 7:40 PM 1-10-2008

      2010 VW GTI 4dr CW
      2012 Ford Fusion
      1976 Chevy K20 (SM465/NP205) "Big Red"

    29. Banned
      Join Date
      Nov 20th, 2004
      Posts
      4,258
      01-10-2008 06:13 PM #99
      Quote, originally posted by dubatwork2 »

      That is not consolidating at all, that is re-allocating. Big difference, and the exact opposite of your intended meaning. Consolidating is going towards something and not away, or concentrating the position.

      Consolidation:
      combine (a number of things) into a single more effective or coherent whole:

      I said, "Consolidating shares means, moving it to other means to protect your assets such as precious metals."

      Which is well with the encyclopedic definition of the term as above.

      Quote »

      I love when people think since Gold/Silver/Plat is up that its a good investment. You realize that the price of those metals has actually been almost identical to inflation, if not a bit under historically averaged? If you want to secure your money, insured bonds or cd's are probably the best, short of annuities and garunteed contracts.

      lol, My old man, for sometime, received numerous calls from so called Financial Advisors. They said he should invest in this or that. He simply asked them to show him how well their own portfolio is doing. None of them was able to. Till this day, Gold and Silver takes up huge part of his assets. Price of Gold and Silver rose vs US dollar as value of US dollar fell, which is why it mirrors the inflation. One ounce of Gold will buy me more US dollars after one year than any 12monts CD ever will at this point. So I am not sure what your point is here.

      Quote »

      What E-trade does is it's business, but selling Muni's as relation to the CDO crunch is actually unrelated entirely. CDO's and muni bonds have nothing in common other than the fact that they are debt instruments. Like I said before, tell me how risky a muni is when out of the tens of thousands before, only 4-5 have ever defaulted. Then tell me the risk when they are insured bonds.

      Again, you are leaving off all other comments and tackling me on municipal bonds that E*trade sold. Correct, it is their business. They may have sold them in order to raise capital. I was quoting the fact as they unloaded about $3 billion of mortgage-backed security and municipal bonds. But the fact remains, many people have consolidated shares into more stable assets such as precious metals and moved their money far away from financial stocks. I am not sure what is there to argue.

      So tell me, your version of the story as to why MBIA cut the dividend by 62% to raise $1 billion? BTW, MBIA is a bond insurer. Are you saying that this insurer needed $1bill just for sheits and giggles? Truth is they have no idea who far the loss will go. They are not set up to absorb the type of loss we are seeing in the market. That a simple fact.

      I am curious. How long have you been in finance business?


    30. 01-10-2008 08:07 PM #100
      Quote, originally posted by marzen »

      Consolidation:
      combine (a number of things) into a single more effective or coherent whole:

      I said, "Consolidating shares means, moving it to other means to protect your assets such as precious metals."

      Which is well with the encyclopedic definition of the term as above.

      lol, My old man, for sometime, received numerous calls from so called Financial Advisors. They said he should invest in this or that. He simply asked them to show him how well their own portfolio is doing. None of them was able to. Till this day, Gold and Silver takes up huge part of his assets. Price of Gold and Silver rose vs US dollar as value of US dollar fell, which is why it mirrors the inflation. One ounce of Gold will buy me more US dollars after one year than any 12monts CD ever will at this point. So I am not sure what your point is here.

      Again, you are leaving off all other comments and tackling me on municipal bonds that E*trade sold. Correct, it is their business. They may have sold them in order to raise capital. I was quoting the fact as they unloaded about $3 billion of mortgage-backed security and municipal bonds. But the fact remains, many people have consolidated shares into more stable assets such as precious metals and moved their money far away from financial stocks. I am not sure what is there to argue.

      So tell me, your version of the story as to why MBIA cut the dividend by 62% to raise $1 billion? BTW, MBIA is a bond insurer. Are you saying that this insurer needed $1bill just for sheits and giggles? Truth is they have no idea who far the loss will go. They are not set up to absorb the type of loss we are seeing in the market. That a simple fact.

      I am curious. How long have you been in finance business?

      Defend your choice of consolidation all you like, even your definition of consolidation has nothing to do with diversification or tactical re-allocation, in fact it means quite the opposite, both in the dictionary and in every financiers vocabulary.

      As for your old man, depends on who he talks to I suppose. Why can't they show a portfolio? That is very easy in most cases. Very few advisors out there are picking and managing stock funds, so there is no "portfolio" per se. They generally use menu's of different vehicles and combine them in different ways depending on the client. An example is sometimes a client benefits from an annuity, many other times it is not even a remotely valuable tool. Sometimes mutual funds work, others no. Sometimes pure Muni's. Its a loaded question. Not only that, it is also a known rule that someone who hires on performance is a bad client, because they will be comparing your future performance to cherry picked results in the future and to others falses promises. What you should look for in a FA's performance is how they compared to the benchmark in both regards. What percent of the upside AND downside did they capture.

      For example:
      -If I were to manage a portfolio for a client and the market did -20%, +10%, +20%, -20%, -15% and my performance was -10, +8, +16, -12, -5. I would say he did very well despite never outperforming the good years.

      As for your gold buying more than a CD in 12 months, thats just completely incorrect. A CD generally returns 4-6% in the last few years. Gold has done very well over the same period, however look at historic returns. The 50 year return on gold is 2.2%, not looking so good now, average on a CD or TBill is 5.88%. Oh, and another thing is that there is no risk in a TBill or CD to speak of, gold does have risk.

      People moving money away from financial stocks is relevant to the market as a whole how? It is ONE sector of the market. Also, if you think financial stocks are that bad, I will bet you that they will be one of the best buys come mid summer when MER, GS, C are all selling at a discount when the reality is that most of these banks are not nearly as badly hurt as the common pleb thinks.

      As for MBIA, I could care less why they raised the money, for all I know the CEO needed a new golden urinal. Doesn't matter, because they are not the carrier of the indenture. They are hedged, just like everyone else, and in the indemnity business, that is done through reinsurance. Same way when Katrina rolled through, Statefarm didn't go out of business with 7 billion in claims when they had 20% of that in reserve. More importantly, your idea that bond insurance companies will fail to pay is ludicrous, it is not going to happen, and if it does, the world as a WHOLE is fubar.

      I have been in financial services now for 7 years, but frankly, this stuff is basic, so it is hardly relevant.

      Resume doom n' gloom.


    31. Banned
      Join Date
      Nov 20th, 2004
      Posts
      4,258
      01-10-2008 10:43 PM #101
      Quote, originally posted by dubatwork3 »

      Defend your choice of consolidation all you like, even your definition of consolidation has nothing to do with diversification or tactical re-allocation, in fact it means quite the opposite, both in the dictionary and in every financiers vocabulary.

      You asked what I meant by it. I guess you got me on technicalities.

      Quote, originally posted by dubatwork3 »

      As for your gold buying more than a CD in 12 months, thats just completely incorrect. A CD generally returns 4-6% in the last few years. Gold has done very well over the same period, however look at historic returns. The 50 year return on gold is 2.2%, not looking so good now, average on a CD or TBill is 5.88%. Oh, and another thing is that there is no risk in a TBill or CD to speak of, gold does have risk.

      LOL, that is such a cheap shot. So you want to talk about annualized return of 12 month CD and yet, you will stretch the gold return for 50 years? How about we look at past 8 years? shall we? Since you conveniently forgot to mention the startling fact, I should remind you.

      Had you invested $10,000 in gold bullion in 1999, your initial investment would have grown to $28,007 by 12/17/07 – an amazing 180% percent increase. ROFL! show me a CD or T-bill that would've given me this type return in 9 years! Now, tell me that is not a good investment. NO wonder my father hates so called Financial Advisers. The fact that Gold price is jumping this high is a strong indication of weakening US dollar.

      Quote, originally posted by dubatwork3 »

      People moving money away from financial stocks is relevant to the market as a whole how? It is ONE sector of the market. Also, if you think financial stocks are that bad, I will bet you that they will be one of the best buys come mid summer when MER, GS, C are all selling at a discount when the reality is that most of these banks are not nearly as badly hurt as the common pleb thinks.

      Your prediction has nothing to do with why people are moving their shares. Many individual investors trade in motion of the market rather than based on fundamental data. If you think otherwise then that is because you are trained to think that way. Ask any experts. They will agree with what I just said. Explain the tech bubble.

      Quote, originally posted by dubatwork3 »

      As for MBIA, I could care less why they raised the money, for all I know the CEO needed a new golden urinal. Doesn't matter, because they are not the carrier of the indenture. They are hedged, just like everyone else, and in the indemnity business, that is done through reinsurance.

      Again you show your short knowledge on this matter. I will not bore you with my explanation of the issue. Since you are used to reading dry financial stuff, take a load of this. Come talk to me again once you are done. No, once you understand the magnitude of the issue we have in hand.

      http://seekingalpha.com/articl...cking


      Quote, originally posted by dubatwork3 »

      I have been in financial services now for 7 years, but frankly, this stuff is basic, so it is hardly relevant.

      Resume doom n' gloom.

      In 7 years, I am certain, you never saw anything like this.



      Modified by marzen at 8:40 PM 1-10-2008


    32. Senior Member beng's Avatar
      Join Date
      May 13th, 2002
      Location
      NutVegas, NJ
      Posts
      30,149
      Vehicles
      Family Truckster
      01-11-2008 09:30 AM #102
      Quote, originally posted by marzen »
      In 7 years, I am certain, you never saw anything like this.

      All of the arguments aside... this is a good point.

      There hanst been a protracted market debacle like this will be since the 70s... and I think after all is said and done this will be a little worse.

      I've spent pretty much my entire career in a bull market. Being prepared and well positioned for a downturn hasn't been required of me (us).

      1 3 4 5 7 8 8 9 10 15 16 23 32 37 42 44 49

      "I don't know half of you half as well as I should like; and I like less than half of you half as well as you deserve"

    33. Member
      Join Date
      Jun 19th, 2002
      Location
      CLT NC
      Posts
      6,051
      Vehicles
      A3 Pilot S2K
      01-11-2008 09:41 AM #103
      Quote, originally posted by beng »

      All of the arguments aside... this is a good point.

      There hanst been a protracted market debacle like this will be since the 70s... and I think after all is said and done this will be a little worse.

      I've spent pretty much my entire career in a bull market. Being prepared and well positioned for a downturn hasn't been required of me (us).

      Very true. I've written here before that the age of most of the posters here has a huge influence with the reactions posted. I'd bet the average age in these M&I threads is less than 30 meaning there has been no first hand professional experience with a downturn.

      I've suffered through a recession and a huge tech bust (where I lost a lot of $$). It kinda forces you to look long-range. I'm going to be realistic about the next year or 2 but not overreact, just like I didn't overreact (ie - overspend) the past 7 years. In 10/15 years, none of us will remember this downcycle.


    34. 01-11-2008 10:59 AM #104
      Quote, originally posted by marzen »

      You asked what I meant by it. I guess you got me on technicalities.

      LOL, that is such a cheap shot. So you want to talk about annualized return of 12 month CD and yet, you will stretch the gold return for 50 years? How about we look at past 8 years? shall we? Since you conveniently forgot to mention the startling fact, I should remind you.

      Had you invested $10,000 in gold bullion in 1999, your initial investment would have grown to $28,007 by 12/17/07 – an amazing 180% percent increase. ROFL! show me a CD or T-bill that would've given me this type return in 9 years! Now, tell me that is not a good investment. NO wonder my father hates so called Financial Advisers. The fact that Gold price is jumping this high is a strong indication of weakening US dollar.

      Your prediction has nothing to do with why people are moving their shares. Many individual investors trade in motion of the market rather than based on fundamental data. If you think otherwise then that is because you are trained to think that way. Ask any experts. They will agree with what I just said. Explain the tech bubble.

      Again you show your short knowledge on this matter. I will not bore you with my explanation of the issue. Since you are used to reading dry financial stuff, take a load of this. Come talk to me again once you are done. No, once you understand the magnitude of the issue we have in hand.

      http://seekingalpha.com/articl...cking


      In 7 years, I am certain, you never saw anything like this.

      Modified by marzen at 8:40 PM 1-10-2008


      Fair is fair, so I did some math for you on your wunderbar Gold as an investment.

      Lets look at the 28 year returns, 28 years simply because that is how far the accurate charts are going right now. In those 28 years gold has had a total return of 30.3% or 1.0821% per year. The 12 month Tbill on the other hand has a total return of 167.97%, or 5.9989% per year. Now keep in mind, I did not compound the Tbill #, but the gold #'s are inherently compounded.

      So, your ultra secure commodity of gold, appears to be one of the worst investments of all time, when compared to what is generally regarded the MOST risk free investment available on the freaking planet. This is also not showing the fact that investing in gold you can LOSE principal... can't do that with a TBill.

      Your gold comparison is something like cherry picking... with a time machine. Assuming you buy any investment at the perfect time, then sell it at the perfect time, of course your returns will be incredible. Oh, and don't say that there were not major issues causing a major run on gold in those 28 years either

      Yes, many investors trade with the market, its called odd-lot trading theory. Something else that is funny... the leading performers in recent market history will show you reams of data saying that going against the day traders is the best way to obtain superior returns.

      Wow, you found a doom and gloom article on the internet. Everything on the internet is 100% accurate too. Think about something for a second. You are trying to convince people that bond insurers are possibly unable to provide indemnification. What I have said repeatedly, repeatedly, is that 1) 4-5 bonds in the history of the united states have defaulted 2) the bond insuring program is incredible layered, robust, hedged, and reinsured around the world.

      Ok, the experience comment is half accurate. However, you keep saying "prolonged downturn". It has been 1500 points, or 11% of the market in 6 months, which it has done many times before. There is no reason, at this point, to assume the cataclysmic events you are predicting.

      However, in those 7 years I did hear alot of doom n' gloomers. How about the tech bubble, oh yea, no one said the markets were failing after 9/11 either.

      Please, if you are so accurate, start buying up shorts on major market indices.


    35. Member
      Join Date
      Feb 20th, 2000
      Posts
      1,879
      Vehicles
      05 330ci ZHP conv; 12 BMW 328i; 12 Toyota Highlander Limited AWD
      01-11-2008 12:35 PM #105
      So, assuming that one can survive a recession relatively intact, how does one position ones self to make a killing on the upside?

      My career started in '87, and I met plenty of people back then who made a lot of money after the previous recession.

      I figure the best thing to do is weather the storm and prepare to collect when it ends.


    Page 3 of 224 FirstFirst 12345671353103 ... LastLast

    Posting Permissions

    • You may not post new threads
    • You may not post replies
    • You may not post attachments
    • You may not edit your posts
    •