The Great Unwinding
El Gran Desenrollar
большой разматывать
Das Große Abwickeln
Le Grand Déroulement
Svolgersi Grande
Het Grote Afwikkelen Zich
Asian Markets Plunge Across Board, Nikkei Tumbles for 5th Day; Europe Opens Lower
TOKYO (AP) -- Markets in Asia and Europe fell again Monday, extending their slide into a second week as investors worried about a possible global slowdown dumped stocks that had surged in recent weeks.
Also sparking jitters was the yen's jump to a three-month high against the dollar as traders sold off higher-yielding investments funded by borrowing money at Japan's ultra-low interest rates.
A decline in this so-called yen-carry trade could hurt global liquidity.
In Tokyo, the Nikkei 225 index fell for a fifth day, tumbling 575.68 points, or 3.34 percent, to 16,642.25 points, dragged down by major exporters such as Canon Inc., Sony Corp. and Toyota Motor Corp., whose earnings are eroded by a stronger yen. Since reaching a nearly seven-year high last Monday, the Nikkei index has slid 8.64 percent.
Markets in Hong Kong, Australia, the Philippines, India and South Korea all fell sharply Monday, continuing their declines from last week, when a 9 percent plunge in Chinese stocks on Tuesday triggered a sell-off on Wall Street and other global markets.
European markets also opened lower Monday, with Britain's benchmark FTSE 100 down 1.5 percent in early trading, France's CAC 40 sliding 1.8 percent and Germany's DAX sinking 2.1 percent.
Australian markets -- which had hit records last month -- fell for a fifth day, sinking 2.3 percent. South Korea's benchmark index dropped 2.7 percent, Philippine stocks plunged 4.5 percent, and Indian stocks were down nearly 4 percent.
"It's snowballing," said Jose Vistan, research director at AB Capital Securities in the Philippines.
March 05, 2007
"It's snowballing"
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56 comments:
Have we, HPs, decided which "I told you so" dance we are going to do? We need to choreograph the dance someday.
The unwinding of the Yen carry trade may have more impact than the collapse of the subprime industry
Markets down across the board man is this ugly!
It's still a little early to tell, but indeed the synchronized global stock meltdown does not bode well, especially for over-extended homedbetors.
It appears that the milti-trillion dollar yen carry trade is rapidly unwinding, which is rippling trhrough all market sectors where hedge funds were speculating, including not only stocks, but also precious metals as well.
Another huge issue came late last week with the meltdown of not one, but two of the major sub-prime lenders (New Century and Fremont). Not only is this bad for these sub-primes and their shareholders, and CDS insurance writers, but it will certainly impact all other sub-prime lenders who will have increasing difficulty in feeding their loans to the Great Securitization Machine.
Without sub-prime debtors (many of whom are first-time buyers), what happens to the happy daisy chain of housing? How can everyone keep moving up to ever-larger and more expensive McMansions if the new meat cannot enter the game?
Better tighten up your chinstraps, it's gonna be a wild ride.
U.S. stock futures hurt again by yen, lending fears
LONDON (MarketWatch) -- U.S. stock market futures were pointing to another tumultuous session on Monday, with gains for the Japanese yen potentially hurting hedge funds and others that borrow in the currency and with mounting doubts over the health of the nation's second-largest subprime lender, New Century Financial.
S&P 500 futures dropped 14.4 points at 1,371.50 and Nasdaq 100 futures dropped 20.25 points at 1,706.00. Dow industrial futures dropped 129 points.
1000 points down today is not a stretch
In russian: Большой откат
B...bb.....but Maria Bartiromo said yesterday that it would be OK!
Have we, HPs, decided which "I told you so" dance.
----------------
Macarena, except the choreography will consist of Middle fingers, mooning, and lots of fist pumping in the air.
Time for the government to manufacture more cheery numbers to keep the lemmings consuming.
Chris G
FMT
OOUUCCHH!
Pre-Market: 5.10 -3.61 (-41.45%) Mar 5 7:56am ET
Mortage Sector in 'Downward Spiral'
"Last week's market volatility may be cause for alarm in the short run, but savvy investors always take the long view."
Yea, or until stock = 0
WTF....there IS NO LONG VIEW!
The stock market crash of 1987 was the largest one day stock market crash in history. The Dow lost 22.6% of its value or $500 billion dollars on October 19 th 1987!
We can beat that today. Let the bloodletting begin.
Once again, the remarkable similarity between all of the market crashes is striking. It seems that after all of the historical market crashes, people would learn to foresee a coming financial disaster. This rarely happens, of course, which is why there is constant opportunity for the smart money to prosper from the irrationality of other people.
How's that gold doing for eveyone this morning?
Funny how a week ago you all were screaming buy gold buy gold. Well either you did and you lost a ton or you didn't in which case you have once again proved yourselves to be full of bullshit.
Anonymous said...
1000 points down today is not a stretch
March 05, 2007 12:02 PM
And you wonder why nobody takes you people seriously.
Hmm, after the jews in the weimar republic bancrupted Germany, the Germans came up with catchy saying as well........SIEG HEIL!!!! or "hail victory"
http://www.nytimes.com/2007/03/06/business/06stox.html?ref=business
Analysts in Europe said that the sell-off of assets considered risky was likely to continue for some days. But they said that the decline was probably not a sign of a new recession and that it was unlikely to set one off.
One fund manager noted that there is still enough liquidity in the market and companies are still reporting higher profits, so the stock slump is not likely to be more than a market correction.
“This is the way that corrections work,” said Garry Evans, a strategist with HSBC in Hong Kong.
The markets are “spooked,” he said. “A week ago, everyone was very excited about the markets and now no one wants to buy stocks,” he added.
If there is an inflection(s) point for the snowball, what do you think they may be?
"Many analysts see the market selloff as a healthy correction for markets that had risen too far, too fast"
Where have I heard that before
Asian markets down across the board yet the American markets were up strong this morning and then fluctuated. That makes little sense. Unless the PPT was in full bore mode and then ran out of money.
This is unprecedented.
The guys at countrywide and new century made an average of 40 million per year in the last 2 years and now they are retired leaving stock holders with empty bags
http://www.nytimes.com/2007/03/05/business/05lender.html?em&ex=1173157200&en=4971ad61a881ad29&ei=5087
As of 10:00 Pacific Time
DOW down 0.31
Gold down $3.10
You were saying something about an equities implosion and something else about buying gold...
Yeah today's one point decline (so far) is going to have a lot of people running for the exits.
If housing prices dropped 10% or so in week everyone on this blog would be calling for the End Times. But that's just about what's happened to gold prices and not a peep out of anyone. I guess in this case, silence really is "golden."
GOLD AND SILVER ARE HAVING A FIRE SALE
That's the neg-am loan bookings WaMu has on their balance sheet.
Gold down to below $640, making it negative YTD.
NEW YORK (CNNMoney.com) -- "Lending to home owners and buyers without good credit has suddenly become a very bad business, and possibly a very big problem for the U.S. economy as a whole."
Who would have guessed?
"This is already a very, very ugly day and and fear it is only going to get worse. Put your tray tables and seats into a locked and upright position and prepare for a very, very bumpy ride."
Would you please pass the Jelly!
The key to financial succes is to diversify. Trillions of dollars are moving around the global markets but they aren't moving out of the market.
Definately you don't want to be holding residential real estate if you bought in the last five years or have an ARM and HELOC you can't afford or the rent would not cover the costs. You must sell now!
I like to hold 50% cash, 20% bonds, 15% precious metals and 15% gold and precious metals (no residential real estate right now because I just sold in 2006). The older you are the less risk you should take in stocks and metals.
The time to put money under the mattress is when banks stop lending due to recession and major downturn in employment and business. This is what I fear if this housing crash continues to drag on. Sellers must lower prices this year and take there loss if any and move on. The residential real estate party is over.
STOP RIGHT THERE MISTER!!!
One of the federal reserve presidents said we won't have a recession:
SANTIAGO, March 5 (Reuters) - St. Louis Federal Reserve Bank President William Poole said on Monday he did not see a U.S. economic recession ahead and that financial markets seemingly agreed with this view.
"To me, and, I believe, the mainstream of forecasters both in government and out, we do not see a recession on the horizon," Poole, a voting member of the Fed's monetary policy-setting panel this year, said at an event staged in Santiago, Chile, by the Global Interdependence Center of the University of Pennsylvania.
"Moreover, beyond our own judgments on that as forecasters, I don't think that the markets see (a recession)," he added, saying futures markets betting on the course of U.S. interest rates had not shifted dramatically in recent days."
You see, anybody getting paid a lot of money, must be telling the truth. Otherwise why would they be getting paid so much money?
(Disclaimer: For those people that didn't catch it, this is called sarcasm.)
My Fangs are out in full force - love the smell of a market crash in the morning - I LIVE for this stuff. . .holding cash and renting. . .waiting to pick up some nice blue chips at 1/2 off. . .PPT tried in vain today to prop up the DOW, but they were foiled by foreign cash fleeing!
But, but, but......my realtor said my home would never decline in value. LOL LOL LOL
Totally enjoyable DOW/Naz meltdown. WAY OVERDUE too.
``1000 points down today is not a stretch''
Apparently the market didn't agree with you.
Anonymous said...
1000 points down today is not a stretch...
In russian: Большой откат
I dont know Russian but I assume it must mean Bull S#$t.
Dow down 64, Naz down 27. And this, remember, was after an arm-wrestling match between the bulls and bears after a heavy week of selloffs.
Stocks soared suddenly in the morning, possibly due to big money intervention, but lost it all by the end of the day. No, there couldn't be anything wrong now, could there?!
All the bubble deniers can do is mock one guy's hyperbole.
Losers.
>>GOLD AND SILVER ARE HAVING A FIRE SALE <<
Fund selling to meet margin calls, not fundamentals. Good oppportunity to accumulate some gold stocks while the price is low. And, no, I am not a gold bug.
It does look very ugly- in the end it could match the worse case doomsday scenario the most pessimistic many have spoken for so long here. Grim.
The question is -whats next? Scary.
LEND down another 25% today
NEW down another 69% today
FMT down another 32% today
CFC down another 5% today
Blood in the streets
Dow down 64, Naz down 27
Naz? WTF? Who are you people? Last time I heard nasdaq refered to as naz was 10 years ago.
Some troll pulls a number out of his ass, i.e. 1000 points and several take the bait. For those that took the bait, your weak minded.
Here's some more bait for you and this is easily verifiable. The DOW is DOWN EIGHT OF THE LAST NINE trading sessions.
If you think that isn't significant, try to find out the last time that happened.
Fund selling to meet margin calls, not fundamentals. Good oppportunity to accumulate some gold stocks while the price is low. And, no, I am not a gold bug.
Sounds suspiciously like what a realtor told me that now is a good time to buy a home since prices are low.
Never buy at or near the top of bubbles. It can take decades to recover your losses. The NASDAQ is less than half of it's peak in March 2000 even with all the inflation and rates going to 1%
Will CSCO ever reach $82 again? Probably not for another 50 years. Will that ugly shack in Compton ever sell for $400K again? Maybe $400K pesos because SoCal will be a part of Mexico in 20 years.
We renters are like the "idiots" back in 1999-2000 who had our money in T-Bills or long term CD's while all the "geniuses" were buying dotcoms and making a fortune on paper. In the end most of the went broke while the "idiots" steadily increased our wealth.
Remember to always buy low and sell high. When the government is talking about a bailout of Countrywide and WaMu, that is when you buy a house in a foreclosure auction.
With all the subslime lenders closing, will Biff and Chad be making sandwiches at Subway again? Will the Escalade and H2 with spinner rims be repo'd soon?
Always remember when you can't sell what you want to, you have to sell what you don't want(gold)to . Gold will be back, rest assured.
For those that took the bait, your weak minded.
OK I'm weak minded. However I do know the difference between your and you're.
Yet another tell of the lack of formal education by the regulars here.
How's that gold treating you these days by the way?
Hey weak minded person - you keep that in mind when you make your comments.
Tell me how much a formal education has saved those people that are losing there homes to foreclosure right now.
I suppose only people that take time to proofread their comments closely, have enough common sense to avoid the pitfalls and traps of ARMS and easy credit?
Someone needs to hold your hand through life, because you don't have enough common sense to fill a thimble.
Somewhat in response to Oracle at March 06, 2007 12:27 AM.
Names don't matter, but I worked for a large company right out of college. The stock was flying high at the time and all in the office maxed out their employee purchase, 401k buys and outside money to obtain this stock. I am the only one in the office who did not follow suit. I was called the fool because I was missing out on the gains. To make a long story short, the stock tanked many lost large values in their 401k forcing them to postpone their retirement. Needless to say I didn't, and don't, have much to worry about. No regrets either. I think its a good idea to opt out of mania's and be a spectator at that point. When everyone is telling me to buy, I'll sell. That's just me...and my money. Good post.
Tell me how much a formal education has saved those people that are losing there homes to foreclosure right now.
Geez man there you go again. Another display of your lack of education.
There homes? No my renting friend. It is their homes.
March 06, 2007 7:20 PM
OK, your a spelling critic. Enough already. Relax a little, it's an informal blog not a term paper.
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