July 05, 2008

HousingPANIC Quote of the Day

"One of the definitions of a bull market is that at the bottom people are so frightened. Actually that is what most technicians are looking for, that kind of fear.

If a contrary opinion is taken, one goes against the herd or against the crowd when everybody is worried about it. It is all in the headlines in the newspaper and every night on TV sets. They are talking about how terrible the market is; that is the seed and the fertile ground that bull markets are built in."


- Ralph Acampora, Chief Technical Analyst, Knight Equity Markets, June 2008
And remember, stocks are not houses...

31 comments:

Anonymous said...

hmmm so since all i see on tv is how the housing market sucks, I should buy? qweefer you need to lay off the vodka amigo

Anonymous said...

well of course it is Ralph. just keep telling yourself that. hey dummie, ever heard of the great depression? gads, another chump talking his book.........keith, along with realwhores, another vanishing job will be stock brokers and financial analyst of all sorts....soon these boys will be mowing my yard and giving me grocery carts at cosco...

Paul E. Math said...

I don't cotton to technical analysis. Fundamentals, that is what matters, that is what people should study.

If everyone pays attention to the fundamentals then bubbles never get very large because everyone spots the inappropriately high prices and sells, taking their gains.

If everyone just follows the technicals, the 'patterns' and 'momentum' then a new bubble gets that much larger as they all pile in and buy.

Also, technical analysis, like the 'sophisticated' models used to price the subprime slime, does not do a very good job of incorporating 'black swan' events such as we are in right now.

I have no respect for technical analysis.

What is going to happen when the baby boomers need to sell their stocks (and fixed income securities) to pay for retirement? Just as there will not be enough workers contributing to pension plans to support retired pensioners, there will not be enough stock buyers to support current price levels when the boomers all become stock sellers.

The book is called "The Great 401k Hoax".

That analyst should keep his 'Dow 7000' license plate on his corvette because that is where we will be by 2012. Believe it.

Anonymous said...

One of the definitions of a substantial bear market is when dolts keep seeing dips as buying opportunities when a secular bull trend has already come to an end. The real smart money keeps selling the rallies. I think this guy needs a little fundamental analysis 'cause it ain't getting better for years to come.

Anonymous said...

In a bull market fear dominates in the beginning AND right at the very end. This man is too eff'ing stupid to breath on his own.

Andrew from Russia said...

> And remember, stocks are not houses...

Right. Houses depreciate smoothly, with false bottoms almost unknown, while the countertrend rallies in stocks have a track record of deceiving many of those who had correctly predicted the top and the first downleg.

Anonymous said...

People have been attempting to call the bottom on financials since last September.

There was plenty of fear then. And the stocks kept on going down, down and more down.

In the GD, the bear market didn't go straight down, it panicked, went up, and then even more down. It took from 1929-1933 (four years) to find rock bottom.

There has to be maximum fear, and yet firm underlying reasons for things to change.

Well, right now, the Fed is going to have to RAISE rates straight into a mother of a recession because of massive inflation.

The current ultralow rates have been an attempt to help banks on the yield spread (banks borrow short, lend long), but it's not enough to paper over the titanic insolvency.

We might have a bottom after Citibank goes into receivership and is purchased by some Saudi oil demon in bankruptcy.

Anonymous said...

Somebody... please translate!

Anonymous said...

DOW at 20K by 2012....

What is this guy smoking?

Dumb Dan said...

If you're just trading stocks, then yes. But what if the value of the stocks is somehow tied to future earnings? Aren't we going to at least pretend there is a relationship to the real world?

Anonymous said...

In 1995, my husband and I were looking at listings taped to a window in a shopping strip.

This older man walked up to us and told us to never buy a home because it was the worst investment we could ever make. I guess he lost. We had just gone through a refenrendum and it was the trough here in Montreal. You could buy a home for 50% of replacement value, and the land came for free! We bought.

Fast forward to 2006, at my daughter's soccer, all parents are grouped together talking about real estate of course, proclaiming how real estate was the best investment we could ever make because it's paying ourselves, unlike rent. Wait a minute... taxes, interest and upkeep total more than the average rent and the capital gains have been made. No upside left.

Greenspan is dead wrong. Peaks and troughs are so incredibly evident, you truly have to be blind not to see them.

Anonymous said...

Which résumé should we, job recruiters and business owners, toss faster into the trash bin?

a. résumé from a realtwhore

b. résumé from an American Airlines-gestapo flight attendant

c. résumé from an union member slacker who thinks that he should get paid as much as a Harvard graduate just to press buttons.


(ABJ) American may lay off 900 flight attendants

American Airlines Inc. has told its flight attendants' union it may furlough 900 flight attendants beginning Aug. 31.

The Association of Professional Flight Attendants said in a hotline message to its 19,000 members that the airline delivered a Worker Adjustment and Retraining Notification Act, or WARN, letter informing them of the possible layoffs. Texas' WARN ruling requires employers to give employees a 60-day advance notice of significant layoffs.


Are you guys keeping count of all the mass layoffs? Oh man, it's going to be another interesting xmas.

Mark said...

Bull Market????

Anonymous said...

pump & dump

Trying to make the sheeple believe that they are "contrarians".

Negative stories on T.V.?

Hardly.

They don't know how bad it is going to get.

Anonymous said...

There is not much fear at all! Otherwise VIX would not be only 25. Lots of people are talking about catching bottom. This can't be the bottom.

When people ramp up mutual fund redemption, when they swear never to touch stock again, that is the bottom. That is probably 15-30% lower than the current level.

wings said...

The horror and fear and trembling and sickness unto death is the seed of the great Bullsh*t Market of Kagunga!

When all are panicking and having loose, colon blow bowel movements, then you must have the eye of the tiger and the Jedi Mind my son.

For then you must strike into the market fearlessly and with bon vivant, so that you may rake in the big bucks as the masses grovel and sweat.

For upon thy loins the contrarian spirit rises like a bloody, screaming Phoenix from the ashes of the trashheap of a collapsed DOW Industrial Average and ubiquitous media hype and puffery.

And upon whose heavy sighs and heaving bosoms of cleavage furrows of angst ye must persevereth!

Yea! For verily I have declared thee a financial genious and man amongst pigmies!

I shall fear no evil and tread upon the entrails of the whimpering squirrel people.

Anonymous said...

From November to April, Google’s once high-flying stock dropped 44 percent, to $412 from $744.

mickeyc said...

You are taking someone seriously who has a Dow at 20 000 forecast by 2011?!
Wow.
Genuine fear IS a great time to buy. We are not there. Look at the VIX.
I can see why technicians get a bad name now from reading that article.
Your positions are toast Keith. Take a loss, move on.

Anonymous said...

Are we there yet?

Anonymous said...

You've got to be kidding, Keith. The P/E of the Russell 2000 is about 80 now.

The time to buy stocks will be when no one thinks it's a good time to buy stocks anymore... when the carcasses of thousands of hedge funds litter Wall Street, and when people don't even try to call bottoms anymore...

lunatic fringe said...

Keith, what is this fascination you have with a bottom in the stock market? A 24.80 reading in the VIX does not show panic, or even fear for that matter. Just like we haven't bottomed in housing, we haven't bottomed in the stock market.

Will there be rallies? - you bet. Are we close to the bottom? - not a freakin' chance.

Save your IMB short winnings and don't try to time a turn.

vanilla ice said...

I don't see the stock market being scared.

Oil fell from 145 to $144 this morning prompting an 80 point rise on the DOW. Wow if fell a whole two dollars. Big deal.

vanilla ice said...

I am a world before I am man
I was a creature before I could stand

Mimimimimimim

vanilla ice said...

And now the DOW's 150 points down at 1:35. Talk about a roller coaster. Is the market really this efficient?

lee said...
This comment has been removed by the author.
FL said...

Stocks may not be houses, but both still rely ultimately on fundamentals to support a certain price.

Based on current fundamentals, especially in light of the fact that corporate earnings projections are still too rosy over the next several years (given than we're not "technically" in a recession), stocks in general are still overvalued.

It's not just about taking a contrarian view. You could argue that the contrarian view on housing right now would be to buy a house, since it is the most unpopular thing to do right now. But we all know that's a stupid thing to do at this point. Same thing goes for stocks.

If you really think this recession will be short-lived and company earning will get better before they get worse, then by all means, go ahead and gamble on the stock market.

However, if you are grounded in reality, you realize that things will get worse (as far as company earnings) before they get better. If you believe that is the case, the last thing you would do is put money in the stock market. Maybe certain stocks will do well in this environment. But betting that the overall market has bottomed is taking a big gamble.

Market bulls always use the "when there's blood in the streets, that's the time to buy" mantra every time the market dips even a little bit. It's a tired line. And it was even used numerous times after the 2000 stock bubble pop - even though the market took several years to ultimately reach bottom.

Anonymous said...

Keith,
Ralph is just a run of the mill shill. You should bring out the big guns - Abby Joseph Cohen is in your corner too, you know.

Anonymous said...

Spirit Airlines is to lay off about 250 employees as it deals with rising fuel prices.

Spirit spokeswoman Misty Pinson said 200 of those laid off will be pilots and flight attendants, and 50 will be non-crew employees.


I wonder were these thousands of laid-off employees will find work with all those "precious" transferable skills, like being rude to passengers, serving peanuts and soda, bringing pillows, etc.

Anonymous said...

Paul Math said:"The book is called "The Great 401k Hoax".

That analyst should keep his 'Dow 7000' license plate on his corvette because that is where we will be by 2012. Believe it."
-------

I havent read the book, but I do believe the market will go back down...maybe not 7,000-

but I can realistically see 8,000.

Anonymous said...

Vanilla Ice said:"DOW's 150 points down at 1:35. Talk about a roller coaster."
----------
Exactly. Doesnt anyone else besides us see the market is very unstable?

Didnt the market behave like this back in 1929?

Anonymous said...

Well, we can count on more foreclosures and bad credit:

AirTran to cut 480 jobs; more cuts likely

AirTran Holdings ( AAI), the Orlando-based low-fare airline, will cut the jobs of 180 pilots and 300 flight attendants to help blunt record fuel expenses.

Further reductions are needed at the carrier's corporate offices and among other work groups such as baggage handlers, an executive said. The cuts represent 12 percent of AirTran's pilots and 15 percent of its attendants.