Stock Market "CORRECTION"

[n2nh]

Quote[/b] ]US stock prices and bond yields plunged on Monday as credit fears grew in spite of aggressive efforts by the Federal Reserve to head off a year-end funding squeeze...

US bond yields hit their lowest levels in more than three years, while the S&P 500 index finished 2.3 per cent lower. The index is now in negative territory for the year and 10 per cent off its record high in October - a technical "correction" in stock-market parlance.

"This had all the fingerprints of a massive allocation shift out of equities and into long-dated bonds," said William O'Donnell, UBS interest-rate strategist.

Investors' worries centred on the fallout from the US mortgage meltdown.

Ah, yes. The same one that I was told I was a "COMMIE" for mentioning in May and June. Hope ya didn't listen to the mavens then or the mavens later who said "Buy now! Stocks are going to go up now that they're down!" Howsabout retiring next week befores you're as poor as the unwashed?

>*< smirk >*<

* But what do I know? I'm just a commie for noticing. http://www.qrz.com/iB_html/non-cgi/emoticons/biggrin.gif * (http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=FT&date=20071127&id=7852474)

[K2WH]

You are correct, it is a great buying opportunity. #The "Offical" market correction is just that, a correction and nothing more. #BTW, there is no "Offical" market correction committee. #It's just a number everyone agreed on at one time in the past.

The scare over the housing and sub-prime market is overblown. #Unfortunately, the people who are very active in the market (in the pits), are watching the numbers very closely and dumping or shifting investments nervously and quickly.

History says this too shall end and eventually continue the upward march as it has since the 20's. #Remember, any losses are only on paper. #Real loses occur when you sell. #I'm very disappointed in my HD stock. #it is doing lousy and when it comes back up, I'm getting out.

K2WH (Wise Investor)

Edit: Hmm, just checked the markets up 250 points ! Just proves one thing. No one knows what the heck they are doing. More and more it is real gambling but, for the most part, the gamblers make money.

[KC0VWU]

Commie.

[n0jaa]

Takes one to know one.

http://www.qrz.com/iB_html/non-cgi/emoticons/rock.gif

[KB1KIX]

Yeah... tough.

Markets »
Updated: 4:02 pm ET, November 27
+215.00(+1.69%)Dow 12,958.44+39.81(+1.57%)Nasdaq 2,580.80+21.01(+1.49%)S&P 1,428.23

My 401K went up almost another buck per share.

Jonathan

[kc2orw]

The term used for the game is "Pump and dump", the shorts are also making out like bandits. Oh well wish I was in a position to play that game to but alas I am not. These days the game seems to have gone global too, and yes there are losers in this game http://www.qrz.com/iB_html/non-cgi/emoticons/biggrin.gif

[KB1KIX]

Absolutely.

But most of those "losers" are those looking for a "get rich quick" scheme rather than follow basic sound investment principals.

I choose to do the later - my investment doesn't grow as fast, but it doesn't lose over the long haul either.

Jonathan

[K3XR]

Yes, they live for doom and gloom.
http://newsbusters.org/node/17425/print
http://newsbusters.org/node/17424/print

[W3MIV]

If you can't stand the heat, stay the hell out of the kitchen.

[al2i]

Be sure to deflate the stock market by the appropriate amount as the Dollar collapses.

Created at BigCharts.com on symbol C_EUR, 5yr, log chart:



http://www.davemcgraw.com/Images/EuroExchange11.27.07.jpg

[K4GUN]

Quote[/b] (KB1KIX @ Nov. 27 2007,14:06)]Yeah... tough.

Markets »
Updated: 4:02 pm ET, November 27
+215.00(+1.69%)Dow 12,958.44+39.81(+1.57%)Nasdaq 2,580.80+21.01(+1.49%)S&P 1,428.23

My 401K went up almost another buck per share.

Jonathan
He picked a hell of a day to start another "woe is the market" thread didn't he? LOL.

[al2i]

Quote[/b] (k4gun @ Nov. 27 2007,14:19)]He picked a hell of a day to start another "woe is the market" thread didn't he? LOL.
The market needs to get to about 18,000 on the Dow to recover the enormous losses of recent years. I will be slowly moving my 401k back into domestics so I can take advantage of the market recovery when it happens.

[n2nh]

Quote[/b] (k4gun @ Nov. 27 2007,17:19)]Quote[/b] (KB1KIX @ Nov. 27 2007,14:06)]Yeah... tough.

Markets »
Updated: 4:02 pm ET, November 27
+215.00(+1.69%)Dow 12,958.44+39.81(+1.57%)Nasdaq 2,580.80+21.01(+1.49%)S&P 1,428.23

My 401K went up almost another buck per share.

Jonathan
He picked a hell of a day to start another "woe is the market" thread didn't he? LOL.
Yep. That was based on CITIgroup finding an Arab backer to take a few $Billion of it's losses at over 12% in interest and a lucrative CITIgroup stock offer thrown in. And yep, read that in W bux. They aren't your Clinton dollars anymore. BTW, a correction last for about 6 months. Unlike gun and the other Zed Mavens, they don't count things in days, but in trends and it is the trend that has set the Correction in motion.

Hm, wonder what hoop they'll jump thru for tomorrow?

[W4MAJ]

What little debt I have is on a fixed interest rate at less than 8 percent. Therefore, my major concern is whether or not my annual cost of living wage increases keeps up or continues to surpass inflation.

What investments I have are tied to my age -- life insurance. Do any of you think my wife will let me retire?

Good luck to the rest of you!

[K2WH]

Quote[/b] (W4MAJ @ Nov. 27 2007,13:04)]What little debt I have is on a fixed interest rate at less than 8 percent. Therefore, my major concern is whether or my annual cost of living wage increases keeps up or surpasses inflation.

What investments I have are tied to my age -- life insurance. Do any of you think my wife will let me retire?

Good luck to the rest of you!
I think as a devoted husband, you should end your life and allow your wife to collect.

K2WH

[W4MAJ]

Quote[/b] (K2WH @ Nov. 27 2007,19:51)]Quote[/b] (W4MAJ @ Nov. 27 2007,13:04)]What little debt I have is on a fixed interest rate at less than 8 percent. Therefore, my major concern is whether or my annual cost of living wage increases keeps up or surpasses inflation.

What investments I have are tied to my age -- life insurance. Do any of you think my wife will let me retire?

Good luck to the rest of you!
I think as a devoted husband, you should end your life and allow your wife to collect.

K2WH
Don't give her any ideas.

[n2ize]

Quote[/b] (n2nh @ Nov. 27 2007,12:57)]Quote[/b] ]US stock prices and bond yields plunged on Monday as credit fears grew in spite of aggressive efforts by the Federal Reserve to head off a year-end funding squeeze...

US bond yields hit their lowest levels in more than three years, while the S&P 500 index finished 2.3 per cent lower. The index is now in negative territory for the year and 10 per cent off its record high in October - a technical "correction" in stock-market parlance.

"This had all the fingerprints of a massive allocation shift out of equities and into long-dated bonds," said William O'Donnell, UBS interest-rate strategist.

Investors' worries centred on the fallout from the US mortgage meltdown.

Ah, yes. #The same one that I was told I was a "COMMIE" for mentioning in May and June. #Hope ya didn't listen to the mavens then or the mavens later who said "Buy now! Stocks are going to go up now that they're down!" #Howsabout retiring next week befores you're as poor as the unwashed? #

>*< smirk >*<

* But what do I know? #I'm just a commie for noticing. http://www.qrz.com/iB_html/non-cgi/emoticons/biggrin.gif * (http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=FT&date=20071127&id=7852474)
This is great news. A definite sign or robust growth.

[kc2orw]

Pump pump pump today... there is always a dump... eventually. Man I wish I could be in on the game but alas I can't http://www.qrz.com/iB_html/non-cgi/emoticons/biggrin.gif

[W1GUH]

Well, Wall Street's happy today.

Stocks Jump As Rate Cut Hopes Increase (http://biz.yahoo.com/ap/071128/wall_street.html)

But somehow...well, nobody has called the market "rational" lately...but look what's in the body of the article:

Quote[/b] ]For investors, the possibility for lower rates seemed more compelling than persistent concerns about a slowdown economic growth. The Fed has already reduced rates at its last two meetings, and continues to inject billions of dollars into the financial system through repurchase agreements to help calm the shaky markets. The central bank will hold its final rate-setting meeting of the year on Dec. 11.




Quote[/b] ]"Everything we're seeing in the market is revolving about credit and encouragement that the Fed is going to bail us out again," said Alexander Paris, economist and market analyst for Chicago-based Barrington Research. "Investors are kind of ignoring the economic news like housing and durable orders that were all weaker than expected."



Quote[/b] ]Wall Street has had a volatile week so far. Economic and credit market concerns sent the Dow plunging 240 points on Monday, pushing the index to the level of a 10 percent market correction before it rebounded on Tuesday. Investors, though still anxious about the credit market crisis and losses at major financial institutions, were somewhat relieved after the investment arm of Arab city state Abu Dhabi invested $7.5 billion in Citigroup Inc.



You economic gurus out there....do I read this correctly? #Wall Street is happy to be "bailed out" again by the fed, while ignoring big problems in the credit industry? #And what about Abu Dhabi bailing out Citigroup Inc?

Is this what it comes down to...the Fed and outside investors helping out their "friends" while ignoring the root problems of a troubled economy? #Hey, what about the "free market?" #Isn't the government supposed to butt-out and let the market sink or swim on its own? #It appears as if the Fed is there to protect its own.

http://www.qrz.com/iB_html/non-cgi/emoticons/sad.gif #http://www.qrz.com/iB_html/non-cgi/emoticons/mad.gif

[KC4RAN]

If you're looking for 'root problems', the root problem of the subprime problem wasn't because the government let the free market work, it was precisely the opposite. The 'all-wise' government mandated that lenders create new lending vehicles to bring 'fairness' to the lending industry, to allow those that did not previously qualify for loans to get loans.

They were basically ordered to give loans to people who did not qualify. All in an effort to promote 'fairness'.

There's a reason you have to put down 20% to get a fixed-rate conventional loan. There's a reason you pay a higher interest rate if you do an 80/10 or something else like that. If you don't have the cash for the real down payment, expect the creditors to charge you more for the money you're borrowing, to offset the losses they're going to take from people who default on these higher-risk loans.

The government said "Loan money to these people!" and the industry came up with new ways to loan money to people who couldn't otherwise afford it. To protect the lending institution, they made the first part of the loan fixed (so they could figure out if they could afford it, and sell the house if they couldn't), and then had to make the rest of it tied to market interest rates (to offset the increased risk of the loan itself). If it had been an ARM to begin with, many of the people wouldn't have been able to get the loan up front, and the creditors would have been in violation of the government mandate.

So the industry created these mandated "sell to those that can't afford it" loans, and now... now people are *suprised* when lots of people... uh, what's the term... "can't afford it"?!? Geez, big suprise?!?

"My husband and I couldn't afford a 20% down payment, and we only make $15K a year each... and with 3 kids, that doesn't go far. But then the bank came out with this new kind of loan, and look at our new $250K house!!"

Were there predatory lenders out there? Absolutely. They existed before the subprime problem ever cropped up. They were the type to make up phony income, fail to list debts on the loan forms, put the loan in mom's name even though it was the daughter owning the car... shady stuff like that. The subprime vehicles just gave them the flexibility (remember, government mandated) to be more creative with their shady practices. Just as before, they manipulated people to sell them loans under terms that were either not explained (because no one had ever dealt with complex loan vehicles like this before... it was either conventional or ARM, not both at once), or because they just flat-out falsified the loan docs.

The next time you cry for the government to 'fix something', remember this debacle. The credit industry wasn't beating down the doors up on Capitol Hill demanding that they please please be allowed to make loans to people that would default on them. That would be stupid. The rules of conventional loans have taken decades to get right, to make it so that the prequalification rules eliminate most everyone who will most likely default on the loan.

Government demanded that the creditors change the rules, not the industry.

[W1GUH]

Quote[/b] ]If you're looking for 'root problems', the root problem of the subprime problem wasn't because the government let the free market work, it was precisely the opposite. The 'all-wise' government mandated that lenders create new lending vehicles to bring 'fairness' to the lending industry, to allow those that did not previously qualify for loans to get loans.


Wow. Missed that one. Can you point me where I can see the evidence for myself that the poor, over-regulated, mortgage industry was forced to loan so much money to so many people who couldn't afford it? That would obviously change the complexion of this whole issue.

[KC4RAN]

Quote[/b] (W1GUH @ Nov. 27 2007,14:26)]Quote[/b] ]If you're looking for 'root problems', the root problem of the subprime problem wasn't because the government let the free market work, it was precisely the opposite. The 'all-wise' government mandated that lenders create new lending vehicles to bring 'fairness' to the lending industry, to allow those that did not previously qualify for loans to get loans.


Wow. #Missed that one. #Can you point me where I can see the evidence for myself that the poor, over-regulated, mortgage industry was forced to loan so much money to so many people who couldn't afford it? #That would obviously change the complexion of this whole issue.
It's called the Community Reinvestment Act. It "compels banks to make loans to low-income borrowers and in what the supporters of the Act call "communities of color" that they might not otherwise make based on purely economic criteria".

I'll let you do your own investigation, but doing some google searches on "subprime created by government" will point you in the right direction.

[KC4RAN]

Also it's important to make a clear distinction that most people don't realize. It may be Citibank or BofA that 'owns' your loan (and are Federally regulated under the CRA and other statutes), it was most likely a Mortgate Broker or Mortgate Banker that sold you the loan... and they are not Federally regulated. At most they are state regulated, and oftentimes very loosely at that.

So be sure where you're laying the blame in this whole mess... It's extremely complex, and I'm only starting to scratch the surface.

[K2WH]

Quote[/b] (W1GUH @ Nov. 28 2007,09:26)]Quote[/b] ]If you're looking for 'root problems', the root problem of the subprime problem wasn't because the government let the free market work, it was precisely the opposite. The 'all-wise' government mandated that lenders create new lending vehicles to bring 'fairness' to the lending industry, to allow those that did not previously qualify for loans to get loans.


Wow. #Missed that one. #Can you point me where I can see the evidence for myself that the poor, over-regulated, mortgage industry was forced to loan so much money to so many people who couldn't afford it? #That would obviously change the complexion of this whole issue.
He is correct. #In the past, many lawsuits were filed for discrimination of all sorts of minorities groups and where they happened to live. #Remember black listing?

Well here you have government mandated loaning of money to people who could otherwise not afford it otherwise be subject to a lawsuit. #The liberals wanted it, the dems demanded it and so did the ACLU. #Presto. #You have what you have.

K2WH (Neocon)

[n2ize]

Quote[/b] (KC4RAN @ Nov. 28 2007,13:43)]Quote[/b] (W1GUH @ Nov. 27 2007,14:26)]Quote[/b] ]If you're looking for 'root problems', the root problem of the subprime problem wasn't because the government let the free market work, it was precisely the opposite. The 'all-wise' government mandated that lenders create new lending vehicles to bring 'fairness' to the lending industry, to allow those that did not previously qualify for loans to get loans.


Wow. #Missed that one. #Can you point me where I can see the evidence for myself that the poor, over-regulated, mortgage industry was forced to loan so much money to so many people who couldn't afford it? #That would obviously change the complexion of this whole issue.
It's called the Community Reinvestment Act. It "compels banks to make loans to low-income borrowers and in what the supporters of the Act call "communities of color" that they might not otherwise make based on purely economic criteria".

I'll let you do your own investigation, but doing some google searches on "subprime created by government" will point you in the right direction.
No. Even with the CIA act it is very hard to make the argument that it drove predatory lending. All businesses have various factors, constraints, regulations and requirements that have to be faced on one level or another. Arguing that regulations caused the insurance industry to engage in such practices is no better than arguing that an abusive parent drove an individual into a life of crime much less as an excuse.. Sure, there is the possibility that it may contribute , but it the degree to which it might is extremely hard to quantify.

[K2WH]

Quote[/b] (W1GUH @ Nov. 28 2007,08:06)]Quote[/b] ]Is this what it comes down to...the Fed and outside investors helping out their "friends" while ignoring the root problems of a troubled economy?
Last time I checked this "Troubled" economy spent 7% more during this Black Friday than last years Black Friday. Real troubled economy.

K2WH (Neocon)

[n2ize]

Quote[/b] (K2WH @ Nov. 28 2007,13:57)]Quote[/b] (W1GUH @ Nov. 28 2007,09:26)]Quote[/b] ]If you're looking for 'root problems', the root problem of the subprime problem wasn't because the government let the free market work, it was precisely the opposite. The 'all-wise' government mandated that lenders create new lending vehicles to bring 'fairness' to the lending industry, to allow those that did not previously qualify for loans to get loans.


Wow. #Missed that one. #Can you point me where I can see the evidence for myself that the poor, over-regulated, mortgage industry was forced to loan so much money to so many people who couldn't afford it? #That would obviously change the complexion of this whole issue.
He is correct. #In the past, many lawsuits were filed for discrimination of all sorts of minorities groups and where they happened to live. #Remember black listing?

Well here you have government mandated loaning of money to people who could otherwise not afford it. #The liberals wanted it, the dems demandied it and so did the ACLU. #Presto. #You have what you have.

K2WH (Neocon)
So then you would feel comfortable with a wide range of unmeasurable cause and effect options as justification for behavior. Thus, I can become a burglar because I got fired and I have too many bills so stealing from others became a neccesity. Not to mention this type of predatory lending was engaged from the get go, and was used against those in the very communities it was supposed to help.

[n2ize]

Quote[/b] (K2WH @ Nov. 28 2007,14:03)]Quote[/b] (W1GUH @ Nov. 28 2007,08:06)]Quote[/b] ]Is this what it comes down to...the Fed and outside investors helping out their "friends" while ignoring the root problems of a troubled economy?
Last time I checked this "Troubled" economy spent 7% more during this Black Friday than last years Black Friday. #Real troubled economy.

K2WH (Neocon)
Don't tell me. Economics is not your forte'.

[KB1KIX]

Markets »
Updated: 4:10 pm ET, November 28
+331.01(+2.55%)Dow 13,289.45+82.11(+3.18%)Nasdaq 2,662.91+40.79(+2.86%)S&P 1,469.02

That makes what.... over 500 points in 2 days.

Yep, market is doing real bad.

Increase in Christmas sales as well - that will make Januarys numbers look good.

Jonathan

[W3MIV]

I am amused by the whole concept of "predatory lending." It seems to me that the truly dysfunctional aspect of this entire fiasco has been people over-borrowing, not "predatory lending."

No lender makes loans with the idea of causing the borrower to default. Credit card junkies, in particular, run up irresponsible amounts of debt, and bank algorithms increase card limits to maximize interest income from the outstanding balances. While it is certainly true that this policy exacerbates the problem of excessive debt, it is vastly more "true" that no bank is holding a gun to any borrower's head.

It is the same "greed syndrome" at work that fuels scammers who send out emails informing a host of recipients that their "free laptop" is waiting to be claimed, or that a "$500 gift card" is waiting for them if only they reply, or any of an exponential quantity of other schemes designed to lure the greedy into thinking that there is something "FREE" in this world. There ain't.

People who run up these debts by extracting every bit of equity in their homes, or overextending themselves to buy an upscale SUV when a Corolla would serve well, or to add a 42" plasma TV to watch overpriced cable feeds of football, baseball or basketball nonsense deserve whatever losses they sustain.

The world owes you not a single damned thing. Get used to that fact and realize that there is no free lunch and no such thing as a "bargain" and you will do just fine.

[KB1KIX]

Quote[/b] (W3MIV @ Nov. 28 2007,17:32)]I am amused by the whole concept of "predatory lending." It seems to me that the truly dysfunctional aspect of this entire fiasco has been people over-borrowing, not "predatory lending."
Predatory lending is a liberal concept.

Bottom line - people took out loans that lenders shouldn't have offered.

They defaulted and the bankers lost their investment as well.

The borrower should be responsible for what they owe - they signed the agreement.

The government, shouldn't be bailing out bad business practices.

If I was a stockholder in any of these companies, I'd be thoroughly ticked off and sell my stock as soon as I know I didn't lose anything in my investment.

Jonathan

[KW4MW]

W3MIVQuote[/b] ]The world owes you not a single damned thing. Get used to that fact and realize that there is no free lunch and no such thing as a "bargain" and you will do just fine.
Indeed - my wizened old grandma has a similar saying she embroided in cross stitch. "You play, you pay".

[K2WH]

Quote[/b] (KB1KIX @ Nov. 28 2007,10:17)]Markets »
Updated: 4:10 pm ET, November 28
+331.01(+2.55%)Dow 13,289.45+82.11(+3.18%)Nasdaq 2,662.91+40.79(+2.86%)S&P 1,469.02

That makes what.... over 500 points in 2 days.

Yep, market is doing real bad.

Increase in Christmas sales as well - that will make Januarys numbers look good.

Jonathan
I guess thats a 5% correction in a positive way. #Again, proves my point. #NO ONE KNOWS WTF is going on. Look at these headlines even though the market is up 330 points.

1) Economy Will Be Hit Hard Even Without Recession
2) SEC Votes to Restrict Shareholder Proxy Access
3) Bear Stearns to Cut 4% of Workforce to Curb Costs
4) Wall Street Bloodbath: Layoffs Keep Growing
5) Oil Tumbles Below $92 as Supply Fears Ease
6) Nuclear Energy Industry Powers Back
7) UpHome Sales, Prices Tumbled Further In October
8) Wells Fargo to Take $1.4 Billion Charge

Go figure.

K2WH

[N3ATS]

Quote[/b] (K2WH @ Nov. 28 2007,16:03)]Quote[/b] (W1GUH @ Nov. 28 2007,08:06)]Quote[/b] ]Is this what it comes down to...the Fed and outside investors helping out their "friends" while ignoring the root problems of a troubled economy?
Last time I checked this "Troubled" economy spent 7% more during this Black Friday than last years Black Friday. Real troubled economy.

K2WH (Neocon)
Credit cards don't count. How much of what was spent was in cash, and not on credit?

You can't manufacture wealth out of thin air.

[N3ATS]

Quote[/b] (K2WH @ Nov. 28 2007,16:48)]Quote[/b] (KB1KIX @ Nov. 28 2007,10:17)]Markets »
Updated: 4:10 pm ET, November 28
+331.01(+2.55%)Dow 13,289.45+82.11(+3.18%)Nasdaq 2,662.91+40.79(+2.86%)S&P 1,469.02

That makes what.... over 500 points in 2 days.

Yep, market is doing real bad.

Increase in Christmas sales as well - that will make Januarys numbers look good.

Jonathan
I guess thats a 5% correction in a positive way. Again, proves my point. NO ONE KNOWS WTF is going on. Look at these headlines even though the market is up 330 points.

1) Economy Will Be Hit Hard Even Without Recession
2) SEC Votes to Restrict Shareholder Proxy Access
3) Bear Stearns to Cut 4% of Workforce to Curb Costs
4) Wall Street Bloodbath: Layoffs Keep Growing
5) Oil Tumbles Below $92 as Supply Fears Ease
6) Nuclear Energy Industry Powers Back
7) UpHome Sales, Prices Tumbled Further In October
8) Wells Fargo to Take $1.4 Billion Charge

Go figure.

K2WH
As long as the companies who publicly trade can keep cutting jobs, laying off workers, cutting salaries and benefits to keep their shareholders happy, the market won't depict what is actually going on.

A company can recoup losses by doing all of the above and they'll keep their stock prices up. For a while.

As the value of the dollar continues to drop, and companies can no longer trim anymore fat, then the market will reflect what is happening. By then it will be too late.

[W1GUH]

Quote[/b] ]The world owes you not a single damned thing.

So why does the Fed time and again bail the markets with rate cuts?

[W1GUH]

Well, so far, one responder rationalized the public sector bailing out the private sector by saying "It's the government's fault." When I questioned that, another said the same thing. Of course, true to neo-con tactics, neither one of them supplied any supporting evidence. But realize that I did not AT ALL address why there are so many bad loans. I was mostly pointing out the irrationality of the markets. In this case, investors are very happy, almost giddy, to be distracted from their real problems because The Fed is going to bail them out. And this is a bailout of the private sector by the government. But of course, to the neo-con mind, this is perfectly OK. Yes, Siree! We're all doomed if the market crashes, so we should be glad the good, beneficial, benevolent U.S. Gommint is there to keep that from happening.

Wow. You guys are almost comical.

[ad4mg]

Quote[/b] (KB1KIX @ Nov. 28 2007,16:17)]Markets »
Updated: 4:10 pm ET, November 28
+331.01(+2.55%)Dow 13,289.45+82.11(+3.18%)Nasdaq 2,662.91+40.79(+2.86%)S&P 1,469.02

That makes what.... over 500 points in 2 days.

Yep, market is doing real bad.

Increase in Christmas sales as well - that will make Januarys numbers look good.

Jonathan
And why is that Jonothan? Maybe because the Fed hinted at yet another interest rate cut? The results of that are predictable ... the Dow will react favorably.

If you're savvy, as you claim, you know there is a breaking point for this. Lowering interest rates again encourages more borrowing, which increases spending ... initially good for the stock market (primarily). But ... the value of the dollar will sink lower. The economy is fueled more and more by credit. The wealth only exists on paper.

To some degree, this works as a short term solution. Everyone is fat and happy, until the bill becomes due.

No, I don't predict a crash. More like a slow return to reality. A slow, possibly painful return. I hear so often some of you pounding your chest about all the money you make on stocks. Until you liquidate, the gain exists only on paper.

With an economy based on oil, and fueled by credit, reality is just around the corner. You celebrate $92/barrel oil ... what a laugher! How much was a barrel of oil a year ago ... or before the Iraqi invasion? How much was home heating oil, say 10 years ago? Compare the increase in the cost of any petroleum based fuel for that 10 year span to the rate of inflation.

I don't think the doom and gloom crowd is totally on track, nor do I buy into this being a great economy. "Great" is a relative term.

I fear all you thumping your chest today might be crying over your bologna sandwich tomorrow.

And me? Most of my investments are pretty low risk, and don't dazzle anyone with their numbers, but its a slow, steady growth, and I can count on them to be around as long as I need them. There won't be as much to pass on when I'm gone, but nobody saw fit to shower me in wealth when they kicked the bucket!

I have selected to live my retirement years modestly, as I have most of my life. I hope all of you do the same ... live within your means.

Please, don't mind my coherent ramblings ... there are libs to bash, and link-o-matic needs to drive thru [sic] and (american)stinker the place up a little, possibly dragging worldnutdaily behind him! And frozen Steve has to tell me how wrong I am, plus '6mhz has to remind us that the dems are invested in defeat. If we're extremely lucky, perhaps 'uye will show up with a math demonstration. Stay the course, gentlemen. http://www.qrz.com/iB_html/non-cgi/emoticons/laugh.gif

[K2WH]

Quote[/b] (N3ATS @ Nov. 28 2007,11:04)]Quote[/b] (K2WH @ Nov. 28 2007,16:03)]Quote[/b] (W1GUH @ Nov. 28 2007,08:06)]Quote[/b] ]Is this what it comes down to...the Fed and outside investors helping out their "friends" while ignoring the root problems of a troubled economy?
Last time I checked this "Troubled" economy spent 7% more during this Black Friday than last years Black Friday. #Real troubled economy.

K2WH (Neocon)
Credit cards don't count. #How much of what was spent was in cash, and not on credit?

You can't manufacture wealth out of thin air.
I'm actually one of the lucky ones. #Even when single, knew my limits and didn't go into much debt. #Currently, I have very little CC debt ~ 1,000 usually paid at the end of the month, most is business expenses reimbursed and no mortgage either.

One of the best feelings in the world is to not owe anyone anything and that happened only once in my life. #When I sold my house to go live with my new wife in her home. #Paid everything off and at that moment realized if I packed everthing up and drove to Mexico, I could live on the beach. #Of course I chose to stay here, but CC debt - none to speak of really.

K2WH

[K2WH]

Quote[/b] (ad4mg @ Nov. 28 2007,12:40)]Quote[/b] ]You celebrate $92/barrel oil ... what a laugher! #How much was a barrel of oil a year ago ... or before the Iraqi invasion? #How much was home heating oil, say 10 years ago?
Yeah, but when everyone was howling about $50 a barrel or even before that $ 25 a barrel doom and gloom reigned from the left. Apparently the economy is very resilient and the left is very wrong.

K2WH

[N3ATS]

Most of us are like that, but many are not.

They will spend, spend, spend, all on credit. So while the general appearance is that spending is up, it's just borrowing that's "up"

[KC4RAN]

Quote[/b] (n2ize @ Nov. 27 2007,14:59)]Quote[/b] (KC4RAN @ Nov. 28 2007,13:43)]Quote[/b] (W1GUH @ Nov. 27 2007,14:26)]Quote[/b] ]If you're looking for 'root problems', the root problem of the subprime problem wasn't because the government let the free market work, it was precisely the opposite. The 'all-wise' government mandated that lenders create new lending vehicles to bring 'fairness' to the lending industry, to allow those that did not previously qualify for loans to get loans.


Wow. #Missed that one. #Can you point me where I can see the evidence for myself that the poor, over-regulated, mortgage industry was forced to loan so much money to so many people who couldn't afford it? #That would obviously change the complexion of this whole issue.
It's called the Community Reinvestment Act. It "compels banks to make loans to low-income borrowers and in what the supporters of the Act call "communities of color" that they might not otherwise make based on purely economic criteria".

I'll let you do your own investigation, but doing some google searches on "subprime created by government" will point you in the right direction.
No. Even with the CIA act it is very hard to make the argument that it drove predatory lending. All businesses have various factors, constraints, regulations and requirements that have to be faced on one level or another. Arguing that regulations caused the insurance industry to engage in such practices is no better than arguing that an abusive parent drove an individual into a life of crime much less as an excuse.. Sure, there #is the possibility that it may contribute , but it the degree to which it might is extremely hard to quantify.
No it's actually rather easy. The big lending institutions are now Federally mandated to carry x% of loans to minorities, underprivileged, from downtrodden areas, etc etc etc... a big list of 'qualifying factors'. But the part that many miss is that this is a multi-tiered industry, not just "one customer, one bank".

Just like most other sleazy sales people, mortgage brokers could care less if you can actually pay the loan off. They get paid on closing the loan. Then they turn around and sell the loan to a big creditor, who 'funds' the loan. Anyone who has purchased a house recently had a good chance of experiencing this. Your loan may have been handled by a local broker, then sold to a big bank (mine was). Happens all the time.

But when you set up a situation where the 'big guys' have to carry x% of loans they would not otherwise carry, then the big guys are all looking to buy loans with these 'qualifying factors', so that they can count another loan towards their mandated percentage. When looking at whether or not to 'buy' the loan, what information do they have to look at? The loan application, the typical credit information (which may or may not exist for the credit-challenged buyer), and whatever short payment history there may be. But they have no idea if the broker forged the information on the loan app.

In reality, all they really care about is meeting that x% so that they aren't dealt heavy penalties from the Federal government. But the Federal government missed about half (or more) of the equation. They forgot that it is the brokers that sell many loans, and forgot to regulate them as tightly as they do the big banks.

So now you have the 'wild west' of brokers and mortgage banks selling loans directly to customers who may or may not fully understand what they're buying, who may be signing falsified documentation, and who inevitably are probably getting a loan they're not really able to pay for. But the broker doesn't care. He's getting his fee. He's selling the loan to the big bank, who has to carry a certain number of 'undesirable' loans, and who is trying to make the decision between defaulting loans and investigation and penalties from the Federal government.

So by forcing the big banks to carry a certain number of these loans, but not regulating *all* entry points into the system, the government created the environment for the perfect credit storm. Requiring someone to do something, but not enforcing the "safety" rules on the whole situation is setting up both sides for failure. Not all sales people are honest, and not all consumers are smart. It's the regulations that are supposed to protect both sides, plus the investor. But that failed...

Yet another example of the Federal government monkeying with things they don't fully understand, and being suprised when things break.

[KB1KIX]

Quote[/b] (W1GUH @ Nov. 28 2007,19:12)]Quote[/b] ]The world owes you not a single damned thing.

So why does the Fed time and again bail the markets with rate cuts?
Nobody minded that during the 90's, did they?

At least then, even conservatives enjoyed making a buck.

Jonathan

[KB1KIX]

Quote[/b] (N3ATS @ Nov. 28 2007,20:00)]Most of us are like that, but many are not.

They will spend, spend, spend, all on credit. So while the general appearance is that spending is up, it's just borrowing that's "up"
Your logic is seriously flawed.

Yes, it's borrowing - but there was still an exchange of funds.

There are a lot more stores receiving than lenders borrowing.

Bottom line - Christmas hasn't killed many people.

I know, I know....it's an evil holiday.

Jonathan

[W1GUH]

Notice that none of the guys who are always proselytizing how great the economy is addressed the perceived notion that the markets are completely irrational and given to fuzzy thinking. Hey, guys, these are the guys controlling the economy. You comfortable with that?

[n2ize]

Quote[/b] (W1GUH @ Nov. 28 2007,23:54)]Notice that none of the guys who are always proselytizing how great the economy is addressed the perceived notion that the markets are completely irrational and given to fuzzy thinking. #Hey, guys, these are the guys controlling the economy. #You comfortable with that?
Well Paul, this is QRZ. Not the most economic saavy place in the world. One day I let a couple of economists with whom I work read one of the market/economy threads. One guy walked away chuckling. The other rolled his eyes in disbelief and flipped me a new DVD to toss in the drive.

[n2ize]

Quote[/b] (KB1KIX @ Nov. 28 2007,14:35)]
Quote[/b] ]
Predatory lending is a liberal concept.


Predatory lending is a general term to describe a variety of shady lending practices.

Yes, its true. Buyer beware. Be educated and learn to spot bad lending put ons. If you are not educated then head to barnes and Noble and get a few good books about economics, loans, mortgages, etc. and learn how it works. Yes indeed, this is what people SHOULD DO. But they don't. Predatory lenders prey on the less educated, the naive, and those desperate to grab a piece of the promised American dream. It works for a while and then something changes. The interest rate goes us. They default on a payment. They are in a foreclosure. They loose their homes. Multiply this by thousands and it not only hurts the sucker but it hurts everyone else.They will always find people to take advantage of. It's not a liberal idea. It's a dirty rotten crooked idea and it's very real and cannot be condoned. Nor can the sucker be the only one to blame. This type of lending must end.

[W1GUH]

Quote[/b] (n2ize @ Nov. 28 2007,03:51)]Quote[/b] (W1GUH @ Nov. 28 2007,23:54)]Notice that none of the guys who are always proselytizing how great the economy is addressed the perceived notion that the markets are completely irrational and given to fuzzy thinking. Hey, guys, these are the guys controlling the economy. You comfortable with that?
Well Paul, this is QRZ. Not the most economic saavy place in the world. One day I let a couple of economists with whom I work read one of the market/economy threads. One guy walked away chuckling. The other rolled his eyes in disbelief and flipped me a new DVD to toss in the drive.
Yep

[n2ize]

Quote[/b] (KB1KIX @ Nov. 28 2007,19:37)]
Quote[/b] ]
Yes, it's borrowing - but there was still an exchange of funds.


(slapping my forehead in disbelief). Uy yuy yuy !!! I can't believe it. http://www.qrz.com/iB_html/non-cgi/emoticons/rock.gif The things I read on this board.

[W3MIV]

Whither goest the odd couple?

Fannie and Freddie (http://online.wsj.com/article/SB119630488772207416.html)

Will Spike Dodd do the right thing?

[ai3v]

Quote[/b] (W3MIV @ Nov. 28 2007,14:32)]I am amused by the whole concept of "predatory lending." It seems to me that the truly dysfunctional aspect of this entire fiasco has been people over-borrowing, not "predatory lending."

No lender makes loans with the idea of causing the borrower to default. Credit card junkies, in particular, run up irresponsible amounts of debt, and bank algorithms increase card limits to maximize interest income from the outstanding balances. While it is certainly true that this policy exacerbates the problem of excessive debt, it is vastly more "true" that no bank is holding a gun to any borrower's head.

It is the same "greed syndrome" at work that fuels scammers who send out emails informing a host of recipients that their "free laptop" is waiting to be claimed, or that a "$500 gift card" is waiting for them if only they reply, or any of an exponential quantity of other schemes designed to lure the greedy into thinking that there is something "FREE" in this world. There ain't.

People who run up these debts by extracting every bit of equity in their homes, or overextending themselves to buy an upscale SUV when a Corolla would serve well, or to add a 42" plasma TV to watch overpriced cable feeds of football, baseball or basketball nonsense deserve whatever losses they sustain.

The world owes you not a single damned thing. Get used to that fact and realize that there is no free lunch and no such thing as a "bargain" and you will do just fine.
If only you were correct, unfortunatly I had an experence that was QUITE different.

A few years back I hit a financial rough spot,My real estate holdings here in Pittsburgh were not doing too well. In fact I was Broke...Outta cash...Busted.

Tried to sell, But the numbers were not getting any better,So I filed for Bankruptcy protection.

Worked out a deal to return the property to the bank,and was waiting on the lawyers to do their thing.

THATS WHEN I GOT THE CALL!!!!

A "lender" wanted to write me a second !!! WOW!!!

I told the "Gentelman" that I was Insolvent, and in the process of Bankruptcy.

WANT TO GUESS WHAT HE SAID ALBERT???

He said "I don't care, I will loan you the money anyway, How much do you want?.

http://www.qrz.com/iB_html/non-cgi/emoticons/mad.gif

You sir, are wrong.

Rege

[K3XR]

Notice how the ZED doom and gloom crowd is all over this one.

http://newsbusters.org/node/17476/print

[NL7W]

Quote[/b] (K3XR @ Nov. 29 2007,08:17)]Notice how the ZED doom and gloom crowd is all over this one.

http://newsbusters.org/node/17476/print
And the national unemployment rate for November is 4.7%! Five percent is considered "full employment" by any country -- worldwide. Reference Bureau of Labor and Statistics website for the latest. Otherwise checkout my unemployment graph, courtesy of them:



http://data.bls.gov/PDQ/graphics/LNS14000000_92499_1197609213185.gif


Again, NH is promoting deeper and deeper BS from the Left...