Why The Stock Market Will Start To Recover This Week

.OrgOwner · 10-13-2008, 4:26 AM

Why? Because I think it is about time some sanity returned. While everyone else is running screaming for the hills the smart guys are already picking up deals. The smart guys work counter to the herd.

themidget2k6 · 10-13-2008, 4:40 AM

I also think it will recover because it owes me about 5k worth of friggen bike money...

BigBassTurd · 10-13-2008, 6:15 PM

I hope so my 401k is down 32%ytd so far

Grover130 · 10-13-2008, 6:19 PM

Let's see what the unemployment numbers look like.

.OrgOwner · 10-13-2008, 6:28 PM

Well at least the market has bouced back well today

mark2119 · 10-13-2008, 7:20 PM

Pure Technicals. World markets were way oversold and due for a retracement. Good chance we could go back down to test our new lows in many of the markets.

Good luck, and remember pigs get slaughtered.

Surffrog · 10-14-2008, 3:20 AM

Overall the correction was necessary and, some would argue, halted prematurely. Nevertheless, the upward trend we are seeing now is due to the concerted effort by all the main governments to show they are going to do what's necessary to pull us out of this mess. Hence investors feeling a little more cozy and secure. However, we may well be in for another correction in the coming months after the US general election.

If "real" confidence has returned, there's are still going to be further job losses over the following year or two, but this will be down to businesses streamlining to reduce overhead and build back reserves.

.OrgOwner · 10-14-2008, 4:32 AM

I think your right Surf, I also think it's going to remain volatile for a while yet until the herd gets comfortable again.

.OrgOwner · 10-15-2008, 6:33 PM

Down 8% at the close today...

dicknose · 10-15-2008, 10:14 PM

Dont try to pick bottoms...
good advice for both possible meanings!

themidget2k6 · 10-16-2008, 12:12 AM

Quote:

Originally Posted by dicknose

Dont try to pick bottoms...
good advice for both possible meanings!

im not that opposed to bottoms...

Surffrog · 10-16-2008, 5:39 AM

Quote:

Originally Posted by themidget2k6

im not that opposed to bottoms...

But back on topic. Can we please remember that not one dollar of the rescue package has been spent yet. As investors want the see the affects of that package, the stock markets will remain volatile fo some time. Asian markets have also just taken another tumble...

.OrgOwner · 10-16-2008, 5:44 AM

So if you have the minerals it's not a bad time to buy then?

Surffrog · 10-16-2008, 5:59 AM

The biggest problem at the moment is not so much the lack of new investors, more the fearful current investors panic-selling short (below cost).

That in turn drives the prices of stock through the floor boards. Then the world governments say they'll provide huge injections of capital to help stablise the markets. However, instead of stablising the market, those investors who'd lost out by selling short then try (a bit like the gambler disparately trying to claw back losses) start wildly looking for short-term profit buying and selling only on the day.

A share for Campbell's soup starts to climb, for example, so some buy in. As soon as they think they've made all the profit they can on that day, they sell. Once one investor sells a significant amount of shares the price starts to drop as more shares are now available and everyone follows suit. Hence the current volatility.

stability comes from a mix of short, medium and long term trades. All we are seeing at the moment is day trades!

steingar · 10-16-2008, 2:36 PM

Could be a very long time before anything recovers in any reasonable way. Too many things going the wrong way right now.

Surffrog · 10-17-2008, 5:19 AM

As I've said before, lets see what happens when the government fund actually starts buying...

.OrgOwner · 10-17-2008, 6:25 AM

This guy seems to think we are in for a bit of a bounce before things get bad again. HS Dent | Demographic - Based Economic Forecasting

Surffrog · 10-20-2008, 9:14 AM

In all honesty, investor faith will return when they have a reason to feel it - positive info in the media, jobs being created and the feel good factor that arises from a positive market place.

The more doom and gloom they see and hear the less they are going to invest. Before all this broke out investors knew they could hedge their bets by holding large amounts of stock in the "Big names". Once they started to tumble, so to did their safety blankets. Nobody knows who is safe or not. I think it's going to take a good one and a half to two years to shake the dead leaves from the trees and bring back market confidence.

.OrgOwner · 10-20-2008, 9:49 PM

And in the time between now and then people with the skills are going to make a fortune playing the market I bet.

NDMBlackBlade · 10-20-2008, 9:54 PM

hasn't hit bottom yet!!

Surffrog · 10-21-2008, 5:38 AM

Quote:

Originally Posted by .OrgOwner

And in the time between now and then people with the skills are going to make a fortune playing the market I bet.

Contrary to popular belief, there are people making money on the stock market today. The only difference is that they are doing so in the fast and volatile day trades. The only people getting involved in that type of trade are those with balls the size of water melons!

.OrgOwner · 10-21-2008, 5:42 AM

Quote:

Originally Posted by Surffrog

Contrary to popular belief, there are people making money on the stock market today. The only difference is that they are doing so in the fast and volatile day trades. The only people getting involved in that type of trade are those with balls the size of water melons!

I would think this is a good time to trade, the market is down and volatile. If you find a bargain sooner or later your going to turn a profit.... The real skill would be picking the stocks that will bounce back first and large.

Surffrog · 10-21-2008, 6:01 AM

Quote:

Originally Posted by .OrgOwner

I would think this is a good time to trade, the market is down and volatile. If you find a bargain sooner or later your going to turn a profit.... The real skill would be picking the stocks that will bounce back first and large.

I think the real skill is finding a stock that's sound with just marginal movement today. The problem is that you can't say, "I'll buy into company X because it's big, well known and if I buy enough shares the marginal movement will still yield more than the interest I get at the bank on my savings."

dr256 · 11-12-2008, 8:19 AM

Personally I think it'll take longer than we think.

I'll admit to nothing next to diddly squat about how the markets work. It always seemed an absurd system to me.

But my feeling is that now governments are looking to the general public to spend their way out of the recession. Lowering interest rates etc to get us buying again. The banks seem to pretty quiet right now which I feel suggests they are going to wait and see rather than picking up the reigns and starting to lend. My feeling is it will 2010 before we see a true bounce back and almost a decade before we see the markets rise to wear they were a year ago.

I also feel that people will take the interest cuts (if the banks ever pass them on) and any tax cuts that come their way, and save the cash rather than spend it. I feel people are thinking its time to have some money put aside for the next rainy day rather than lets go get some new shoes...

Surffrog · 11-12-2008, 9:08 AM

Quote:

Originally Posted by dr256

Personally I think it'll take longer than we think.

I'll admit to nothing next to diddly squat about how the markets work. It always seemed an absurd system to me.

But my feeling is that now governments are looking to the general public to spend their way out of the recession. Lowering interest rates etc to get us buying again. The banks seem to pretty quiet right now which I feel suggests they are going to wait and see rather than picking up the reigns and starting to lend. My feeling is it will 2010 before we see a true bounce back and almost a decade before we see the markets rise to wear they were a year ago.

I also feel that people will take the interest cuts (if the banks ever pass them on) and any tax cuts that come their way, and save the cash rather than spend it. I feel people are thinking its time to have some money put aside for the next rainy day rather than lets go get some new shoes...

I think this is a fair assessment. The banks won't want to undertake any risk loaning when no one can be sure who's safe. All they can do is adopt a wait and see policy.

Ultimately, it will be the people who get the economies moving again. The problem we have at the moment is that the money which is being released by the governments in order to get us to spend more isn't going to get to us for a long time. As I understand from news agencies at the moment, still not one dollar of the 700 billion dollar bail-out package has been spent... I wonder why!

dr256 · 11-12-2008, 10:23 AM

Yes Surfrog - I'm beginning to get the impression that we'll not only have to buy the economy back on track but also foot the bill for higher taxes once its all over. In the meantime the banks will sit and wait for the status quo to return at our expense....oooo i'm back off to the "what's hacked you off today?" thread

TKDmasterZ · 11-13-2008, 5:41 PM

The Great Depression came many months after the stock market crash. I think we can call what happened in October a 'crash'. My company just shed about 10% of engineers, and many are speculating this is the first round of many to come. I think this is happening across the board, and hitting specially hard the smaller companies without much cash to survive. I think 2009 will be gloomy. But it shouldn't take too long before things pick up and we'll be happy wasting our money again!

nedro · 11-13-2008, 5:53 PM

Alot of this would not happen if they did not allow computer generated sales. It makes day trading way too easy. Before, you put in an order and it was filled in 15 minutes to sometimes an hour or more.

.OrgOwner · 11-13-2008, 6:34 PM

I know a guy in Ft Lauderdale who works as a trader for a large company, I don't know the specifics of his job but I do know all his hair fell off while he was still young.

dicknose · 11-14-2008, 12:34 AM

Quote:

Originally Posted by nedro

Alot of this would not happen if they did not allow computer generated sales. It makes day trading way too easy. Before, you put in an order and it was filled in 15 minutes to sometimes an hour or more.

How long it takes is nothing to do with computer generates sales - thats computer processing and direct inputs ie automated processing.

Computer buy/sells are when you set up a rule for when to buy/sell.
The danger with them is more to do with a drop causing triggers to sell which then causes more drops and a feedback loop occurs and can cause a big fall.
Its not helped by automated processing, but the automated processing isnt the problem - its a great thing.