OK, with any bold prediction, you can look the fool when it doesn't happen (the world is ending people, the Cubs will win the world series, etc)
But I'll make one now
The stock market is about to crash.
Why?
Housing bubble has popped
Consumer is done
Gold vaults past $600
Failed US Presidency
Iran goes nuts
Iraq mess
Oil getting crazy again
We're due for a good one
Anyone with me, or am I nuts?
April 11, 2006
Anyone feel like a good crash?
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16 comments:
I think this is too much doom and gloom. Gold and the stock market will become the investment vehicle of choice again as housing deflates.
Do not forget that the world is awash in savings; maybe not the US but the Asian countries and central Europe are saving TOO MUCH. The economic conundrum with savings is that too high of savings reduces consumption which reduces economic growth which in turn reduces ability to save.
I expect the DOW will bust through 12,000 this year on it's way to 15,000 by 2010. Housing will create a drag on the economy but do not count the consumer out yet. There are still plenty of 401Ks to drain, SUV's to sell for pennies on the dollar, and willing lenders ready to loan to keep the consumption train going.
Forgot to add to above-------
The rise in gas prices may in turn fuel consumption. HOW? As people decide that driving a gas hog SUV 30 miles each way to work is stupid (well DUH) they will be buying new cars (consumption) and possibly decide to move closer to towns, buying new houses and condos (consumption) and each time one moves there is redecorating (consumption).
The alternate is to stay in the exurbs and batten down the hatches and not spend which we know isn't possible because there is always one thrifty neighbor who won't be affected by gas prices and will be out spending prompting the rest of the "keeping up with the Jones' crowd" to do the same....
If all speculative bubbles are held up by human psychology, how is the stock market any more immune to crashing than the real estate market? If the general mood of the population is turning negative, then it would seem that this would affect all markets....
I agree, the one thing that makes this totally even more scarier than the Great Depression when 30% wanted communism, another 30% wanted fascism in this country and FDR kept it going as a democracy is that we have a religious fundamentalist end of timer president.
And just like Jim Jones in Guyana, he thinks every one has to drink his cool aid, to usher his deluded vision of the end. And this goes too for Iran where the other religious fruitcake is acting up too.
So even though the real issues, balance of trade ,defecit, economy being hollowed out by cheap everything made in a communist police state. They are bad problems but can be solved with intelligence and reasoning, something that our great leaders don't know shit about, because they have the funny baloney so called bible so far up their asses.
Silverisgood: I catch your drift. We are heading towards some serious problems but I do not believe this is the end of free-market capitalism.
For people to have nothing to consume with (Money) there would have to be no jobs. Some people (possibly many) will lose their houses but there are others who have savings to prop up the economy, buy these houses, and rent them out to former owners. In effect, the consumption of today, at worse case, will create a whole new "slave class" of over-consumers who have to spend the remainder of their lives working in deplorable conditions to pay for their past mistakes.
The rich people in this country have too much to lose to let the whole shabang go to hell.
I fully expect a gov't bailout to protect the dollar and "full faith and credit of the United States". All these people who are driving Suburbans and living in McMansions will be spared the full wrath of their gluttony by the hard workers (i.e. the rest of us) who prefer to live within our means. I would say that our kids will learn from our mistakes but it's the boomers who are dooming it for us who didn't learn from their parents.
Don't forget that China has a ve$ted interest in keeping the American consumers as 'consumerist slaves', at least for the time being until they develop a full middle class.
All politics aside, we are long overdue for a correction/crash to wipe out the excesses of leveraged debt built up over the past decade. But the tinkerers at the Federal Reserve have a plan to "help" us avoid this bitter medicine. Check around and you'll see numerous rumors about lots of overtime at the Bureau of Engraving apparently to print huge sums ($1-2 trillion) of paper money. That amount of cash could be used for many purposes, or it could be shoveled into a furnace and never see the light of day.
I suppose we all will know soon enough...
Silverisgood - What did you say when Billy Clinton sent the B-2s to Guam in '94 loaded with nukear wupons intended to defang Kim Jong Il?
Thought so.
FDR also gave us our great Social inSecurity system that will collapse within 20 years, taking all your contributions with it.
He also attempted the biggest power-grab in American history by trying to expand the Supreme Court to 15 members when they ruled a few a his programs unconstitutional. That is the tactic that Robert Mugabe used in Zimbabwe and Hugo Chavez in Venezuela to consolidate supreme power.
He signed Eastern Europe and its 200 million citizens over to the Stalinist dictatorship at Yalta despite Winston Churchill's objections.
FDR's admin dropped the ball on the Pearl Harbor attack the same way that the Bush admin dropped the ball on the 9-11 attacks.
"It is obvious you are in bed with bush from your tone!"
Yeah, I held my nose and voted for him mainly because the Dems running against him were even bigger head cases. I did not agree with the decision to invade Iraq, even though 98% of Congress supported it at the time.
Which brings us back to the hypocricy now spewing from Dem leaders and the faithful as they ignore the past and try to derail Bush. When Bubba Clinton was President, they were all for carpet bombing Yugoslavia, nuking North Korea if necessary, and yes, even getting rid of that terrible WMD-totin' fellow, Saddam Hussein.
As for your statement "Anything with a nuclear warhead mounted and ready to fire off in my book is very disturbing to say the least", I say great! That's the effect these _strategic_ weapons are supposed to have on people, and when that line of thought occurs in the mind of a potential adversary, something called "deterrence" occurs.
So maybe all this talk about nuking Iran is part of the game, no? Just like Bubba Clinton's little foil back in '94 when he moved those B-1s and B-2s loaded with nuclear bombs to Guam and threatened to shove 'em up Kim Jong Il's puckered a*shole. Looks like it might have worked.
Its OVER. Last one out please turn off the lights.
I'm with you, Keith.
Market is wayyy overdue for a correction.
So many traders (aka "hot money") are chasing these uptrends. They don't care about fundamentals, but just follow the current trend. They will leave en masse when the trend turns downwards, and be happy to get 5% on their cash.
Only question is when. It may already be starting. JDSU is down -5% and -4% the past two days. The most speculative, run-up stocks are typically the first to show signs of weakness.
We live in interesting times.
prof_investor_40
America is not going to bomb Iran; the notion is typical conspiracy hysteria.
The housing bubble is mess, but I don't see evidence of an imminent crash.
People love imagining the worst, and projecting it onto those they don't like. Why do they go to horror movies and disaster movies? Because they're into melodrama.
Bush is no worse than Clinton, the end of the world is not coming, the neocons are no scarier than the ultra-libs, and all of this is a big put-on. My team vs. your team, ra, ra, ra. The fact of the matter is, both sides need each other, and would die of boredom without the fight.
Moman choice of words I will argue the world is awash in debt not savings
skytrekker reference to FDR I will also argue over. The programs that FDR created are our biggest expenditures of today. The thought was nice, but the consequences are killing us.
The market is going to crash, but I think that the bond market is going to go first, and at that point the derivate markets will fall apart and the Mutual funds will have to sell to generate cash for withdrawals. This in turn will stimulate more selling and now your in a vicious loop
The biggest losers will be the biggest players, sadly it will be the retirement funds.
"Bush is no worse than Clinton".
What f'ing planet have you been living on?
Certainly not the one where a president lied himself into a war a has killed over 100,000
so far. I can clearly say that you make me sick.
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