Buying stocks? Shorting stocks? Or happy on the sidelines?

* Fed slashing rates down to 0% in a desperate attempt to create a new bubble somewhere, anywhere

* Congress and Bush dropping hundreds of billions of election-year dollars from helicopters (although they can take their lousy $300 and stick it - that don't buy much these days)

* Government spending taxpayer money on banks and insurers too big to fail - including a potential multi-billion dollar nationalization/bailout of MBIA and Ambac - plus the upcoming massive and historic bailouts of Fannie and Freddie

* Fannie jumbo limits going up (since we're run by corrupt monkeys)

* Stock prices down drastically, including juicy ones like Apple, Google and foreign ETFs

* Credit meltdown still just starting, with lots of writedowns and bad news still to come

So, is a stock market recovery starting, or will it just be a brief sucker's rally, followed by an even deeper crash?

My only advice, worth nothing, is to keep an open mind, be patient, and be very, very careful. This market feels like gambling, not investing. DOPES got slaughtered these past few weeks, don't be a DOPES.

(by the way, anyone see the hilarious Societe Generale trader who just lost 'em $7.2 billion secretly making terrible bets on the market - ouch! Wonder how his performance appraisal goes this year)

Looks like the 3/4 point cut ain't gonna do the trick.

If I would have told you a year ago that the Fed dropped the rate 3/4 of a point in one day, first time in 20 years something like that happened, and the stock market had STILL dropped, you probably would have figured:

1) That the president got shot
2) That a massive natural disaster had hit
3) That a dirty bomb had gone off in a major city
4) That the stock market had crashed 50%

Right?

In the end, this 3/4 point cut will be followed up by many more. Bernanke will end up taking rates below the rate of inflation, and we're probably already there today. It's amazing that a 3/4 point cut hit and stocks STILL dropped. That should show you the extent of the mess we're now in.

Another fun day in the markets today. Especially those of you with your stash in nice safe places, who saw all of this coming.

FED PANIC!!!! Open thread to talk about today's housing-crash-caused stock market crash / rally / craziness

UPDATE: AS PREDICTED BY HP'ERS THE FED PANICKED, DROPPED RATES 3/4 POINT - AND JUST MINUTES BEFORE THE MARKET OPENED. WILL IT WORK?

YOU'RE WATCHING THE PLUNGE PROTECTION TEAM IN ACTION NOW!! BUT HOW MANY BULLETS DO THEY HAVE LEFT IN THE GUN? CAN THEY STOP THE PANIC? OR IS THEIR PANIC GOING TO MAKE PEOPLE PANIC EVEN MORE?

_________

Sometimes being on the sideline with buckets of cash is the best place to be.

Let the movie start already! Man, two days of a worldwide stock market crash and the US hasn't even opened yet, it's gonna be interesting. PPT? Helicopter Ben? Trading curbs?

One more time, for the newbies:

The final phase is a self-feeding panic, where the bubble bursts. People of wealth and credit scramble to unload whatever they have bought at greater and greater losses, and cash becomes king.

Deutsche Bank expects fuc*ed brokerages to announce ANOTHER $10 billion mortgage mess markdown. Meanwhile Citi is expected to take $11 billion itself

$10 billion here, $10 billion there, and soon you're talking about real money. Just like ENRON.

Too bad Deutsche and others haven't figured out the REAL ugly truth yet. That the mark-to-market markdown will be in the HUNDREDS of billions if not trillions by the time its done, with bank failures everywhere. Get ready everyone.

Even the super-SIV that was supposed to help hide the truth is blowing up as people come to realize it was a big scam. Well, then again maybe they all know, and they just don't want to admit it yet. After all, they still have some shares to dump ya know.

Meanwhile, Citi axed its CEO tonight and will be shocking the market with another massive markdown. But no surprises for HP'ers. We knew all along.

LONDON -- Banks are likely to mark down another $10 billion of mortgage assets in the fourth quarter, according to one analyst's estimates.

Deutsche Bank analyst Michael Mayo said in a note Thursday that banks and brokerages are likely to see their earnings pressured through the rest of 2007.

Merrill Lynch & Co. Inc. and Citibank Inc. are expected to be hit the hardest. Mayo estimated each bank would write down $4 billion in the fourth quarter.

He said Bear Stearns Cos. Inc., Morgan Stanley, Bank of America Corp. and Wachovia Corp. are also likely to take markdowns.

Will the stock market crash this week?

A) Yes

B) No

At one point the market is going to have to come to terms with the worldwide housing crash, mortgage meltdown and dollar destruction.

Ben Bernanke wanted to delay that day of reckoning. But we're living on borrowed time.

After taking advantage of the Fed Party, I'm back to extreme defensive as of last week. Let's get it on.

Black Monday?

What's funny for the Faux News and CNBC crowd is that they don't even realize that in gold or Euro terms, the US market is already in trouble. You may feel rich (dollar holders) but trust me, you aren't. Ben Bernanke will make sure of that.

Happy 20th anniversary everyone. Right on schedule. I told you I had a funny feeling this week. Ultrashort financial and commodities (DBA) were great today, and REIC stocks like Countrywide and Wash Mutual fell off the cliff. And of course home prices continue to plummet.

Some days, you see why it pays to be a HP'er. We're as ready as you can be.

Stocks Plunge; Dow Down More Than 360

Stocks Plummet Amid Lackluster Profit Reports, Credit Concerns on Black Monday Anniversary

NEW YORK (AP) -- The Dow Jones industrial average dropped more than 360 points Friday -- the anniversary of the Black Monday crash 20 year ago -- as renewed credit concerns, lackluster corporate earnings and rising oil prices spooked investors.

Today is the 20th anniversary of Black Monday - the great 1987 stock market crash. How will you celebrate?

Remember it like it was yesterday...

Nice thing about a good crash is that people do remember it (for awhile) and don't do such stupid things.

You know, like lending trillions to people who had no chance of ever paying it back. You know, like buying an apartment in Phoenix for $1 million. You know, like having no oversight of mortgage brokers and realtors as they conned America. You know, like doing massive insider stock sales (while having their company buy back stock).

Happy 20th Anniversary, Mr. Stock Market Crash. How's today's market lookin' to ya?

After '87, today's fear is the mini-crash

20 years after the Dow plunged 22% in a day, Wall Streeters aren't too worried about a repeat. But what about a smaller version of that disaster?

NEW YORK (CNNMoney.com) -- A lot of Wall Streeters are reminiscing this week about where they were during the 1987 crash. The more recent tumult - in 2001 and even earlier this year - gets lost in the chatter.

The combination of circuit breakers instituted by the NYSE, and the Federal Reserve's willingness to intervene, means a crash on the level of Oct. 19, 1987 - in which the Dow plunged 22.6 percent on a 508-point loss - probably won't happen again.

But that doesn't mean the market won't - and hasn't already - experienced severe mini-crashes that crush investors and roil the markets for days or even weeks at a time.

Anybody else got 1987 (or 1929) deja-vu?

My foreign funds, oil, gold, silver and stocks have been flying (in dollar terms) since Bernanke's panicked cut a few days ago. Flying. But I've got a strange feeling....

The housing market may still be in denial, but it appears that Wall Street and foreign markets are in Denial Squared.

It looks like the majority of you think the stock market is going to crash this October (see poll to the right). Kinda tough to have that opinion when a full-fledged stock party is breaking out, eh? And remember, 1987 was a blip in the road. 1929 on the other hand...

I've got one finger on the SELL button. And remember, from Manias, Panics and Crashes, eventually cash will be king. The only question is when.

This October marks the 20th anniversary of the 1987 stock market crash, the biggest one day post-war percentage drop for US markets.

In a few short hours on Monday, October 19, 1987, the Dow industrials (DJI) gave up 508 points, or 22%, bringing an abrupt end to what had been a lively Wall Street party.

The crash came against a backdrop of inflation fears, rising oil prices, Middle East tensions and a host of other eerily familiar worry signs in Wall Street's most notorious month, and helped cement October's reputation as the toughest month for the markets, at least psychologically.

So, could it happen again?

The most important paper you'll ever read in your life - CEPR's "Midsummer Meltdown: Prospects for the Stock and Housing Markets.”

Folks, you must, I repeat, YOU MUST, not only read this paper (go to link and hit the PDF) on the US housing and mortgage meltdown from Dean Baker and the CEPR, but you must print it out or send it to anyone and everyone you care about. You owe it to yourself to read the whole report, two or three times if you need to.

Yes, some people still won't get it. Some people will refuse to listen. Some are corrupt and don't want the truth getting out. And many folks out there are just too dense to understand (supply? demand? huh?). But at least you will have tried. And you will have prepared.

Here's some of the key points from this paper - the most well written, thorough, explanatory and shocking expose I've ever seen on the US housing bubble and crash - and just think, this cancer will spread around the world... Get ready.

* Total loss of wealth with the collapse of the housing bubble and stock market will be $8 Trillion to $12.5 Trillion (or more if the crash overshoots)

* Real economists who were warning about the bubble were ignored by the MSM in favor of fake economists at NAR and NAHB

* There is no factor of supply and demand that led to an $8 Trillion housing bubble - and no increase in rents to justify it.

* Inventory of unsold homes is 50% above the previous record - and the inventory of vacant units for sale is more than 100% higher than the previous record, while rental vacancy rate for owned units is soaring

* Homeowners are not prepared for a sharp drop in housing prices - and will enjoy a much less comfortable retirement than they had anticipated

* Median Price reports during the meltdown will be deceiving, as mortgage meltdown decimates the affordable home buyer pool, skewing median purchase price in favor of more expensive homes - Case Shiller index only good gauge available

* Very severe recession coming, pension shortfalls, and annual consumption drops of $415 Billion to $950 Billion

The end of the Great Housing and Debt Bubble is now here - Bear Stearns CFO: "Bond turmoil worse than Internet bubble"

Analysts are shocked

Wall Street is shocked

Larry Kudlow is shocked

Bob Toll and Angelo Mozilo are shocked

Realtors, appraisers, mortgage brokers, homebuilder and lenders are shocked.

And HP'ers knew all along.

The Great Unwinding is here.

Are you ready?

Bond market turmoil sending investors fleeing from risk may be a worse predicament than the 1980s stock market fall and Internet bubble burst, Bear Stearns Chief Financial Officer Sam Molinaro said on Friday.

"These times are pretty significant in the fixed income market," Molinaro said on a conference call with analysts. "It's as been as bad as I've seen it in 22 years. The fixed income market environment we've seen in the last eight weeks has been pretty extreme."

"So, yes, we would make that comparison" to market events that also include the debt crisis of the late 1990s, he said.

Dow down another 200 points today, housing crashing, mortgage market in disarray, debt market in meltdown mode. What's next?

Right on schedule, worst week for the Dow in 5 years.

LBO deals as screwed as Vegas condo owners.

America in a full-on pissed-off negative mood.

The US Dollar getting slaughtered.

Mortgage lenders and homebuilders in total melt-down mode.

Is Monday "Black Monday"?

Will we move from housing denial to housing fear to HOUSINGPANIC in rapid-fire succession?

Are you ready? Did you prepare?

Wall Street extended its steep decline Friday, propelling the Dow Jones industrials down more than 500 points over two days after investors gave in to mounting concerns that borrowing costs would climb for both companies and homeowners. It was the Dow's worst week in nearly five years.

Everyone enjoying the crash? Anyone surprised? Oh, is this gonna get ugly.

As anyone who's read "Manias, Panics and Crashes" knows too well, at this point in the cycle we always see dis-credit, where lending is rapidly drawn in.

And the resulting credit crunch just speeds up the panic and crash.

U.S. stocks to fall sharply at open as jitters resume

U.S. stocks are expected to open sharply lower on Thursday as nervousness in Asian markets, rumors about distressed lenders and the latest U.S. inflation figures, rekindled the selling pressure that sent the market plunging two days ago.

In addition, rumors that a big lender was in distress were floating around the market, according to research firm Action Economics.

"Investors are worried about the strength in the economy and the Fed's assumption that housing has hit bottom," said Pado.

Fleck: The game is over. Subprime helped cause the housing price bubble, and it's over. The Great Unwinding is here.

When it's over, it's really over. I'm amazed at the swiftness of the subprime implosion, and now come the spillover effects. Less housing demand (and ability to purchase). Lower housing prices. Hundreds of lenders imploding. Hundreds of thousands of REIC out of work. Stockholder and bondholder wipeouts. Hedge fund implosions. Financial market havoc.

Got popcorn? The Great Unwinding is here.

What's remarkable is that Wall Street was surprised by the implosions of lenders NovaStar Financial and New Century Financial. What we don't know is how quickly this mess will impact the economy.

Why does the stock market at large seem not to care about the many problems that exist? My best explanation is this: The stock market, which is normally thought of as a discounting mechanism, doesn't work that way at the moment.

When the market reverts to discounting and ceases to be the price-discovery animal it is today, there will be a tremendous amount of violence on the downside.

Ignorance aside, it pays to state the obvious: The subprime industry was absolutely critical to the inflating of the real-estate bubble. If loans had been made only on a responsible basis -- to people who put money down and looked like they could actually repay the money, irrespective of rising house prices -- that bubble would never have achieved anything close to the heights it did.

That game is obviously over. Let me repeat that -- over. The real-estate market of the past few years will not be seen again in our lifetimes. The only thing we don't know is at what rate this unwinding will play out across the economy and, more importantly (to me), in the minds of the Goldilocks-enthralled community on Wall Street.

"Slowly but surely, people are starting to get it, and slowly but surely, I am starting to think that the tipping point in credit -- via a subprime-generated shambles in CDO (collateralized debt obligation) land -- is closer than anybody imagines."