Market view and possible direction

[ModE98]

The future largely depends upon the bootlickers we send to Congress. Will it be controlled by one party or split again with the economy at the mercy of legislators who cannot compromise? The markrt depends on what gets done or not. Time is closing in on us... it will not be long.

[safeharbor37]

They'll just kick it down the road like they always do. However, in my opinion, it's more that the government does too much, not too little.
I don't think we'll fall off the cliff, but am concerned that we've reached the point of no return ~ the tipping point where CHANGE will accelerate and the inevitable changes will occur and lock themselves in more quickly than I'd hoped.
Investors will do fine. Even in the great depression those with jobs did fine, but of course worried that it could happen to them and hoarded what money they had, thereby inhibiting the economy. It's those who are relying on fixed incomes for sustenance who're in danger.
A Republican/Romney win could push it down the road, but it's pretty surely coming. The best approach is to relax and enjoy it ~ the adaptable always come out on top. I'm about half invested so I'm not too worried, but four more of Obama will lead to irreversible change I'd sooner put off.
Here's what we're looking at: chronic unemployment, slow economic growth and rampant inflation once the recovery begins ~ regardless of who's elected. Yes, we'll get through this and in twenty years won't even notice paying ten dollars for a cup of coffee. The crafty will prosper and those not so quick on their feet will suffer. Everything changes and everything remains the same.

[The Virginian]

Here's what we're looking at: chronic unemployment, slow economic growth and rampant inflation once the recovery begins ~ regardless of who's elected. Yes, we'll get through this and in twenty years won't even notice paying ten dollars for a cup of coffee. The crafty will prosper and those not so quick on their feet will suffer. Everything changes and everything remains the same

I agree with everything except...... I will notice paying $10 for a cup of coffee and I will not be happy!

[safeharbor37]

I remember complaining when coffee went from a nickle to a dime. The proprietor explained that I'd get free refills with the dime. That seemed fair. It was a long time before I'd buy a 2-3 dollar cup of coffee at Starbucks unless I was stuck at an airport or some such. Now I don't blink an eye paying that for a cup of coffee and think I'm really getting a good deal when McDonald's runs a $1 drink special.
It always interesting to me that people howl bloody murder because gasoline has increased ten fold over that period of time [about equivalent to inflation] and are perfectly willing to pay 20-30 times for coffee and don't blink an eye paying > a dollar for bottled tap water which didn't even exist when coffee was ten cents.
We get used to anything.

[The Virginian]

True, I remember the first time I saw bottle water ( actually it was canned) I thought it was the funniest thing ever. As a youth I wondered why any person would ever want to buy water.

As for Starbucks - I have never purchased anything from them. Probably never will.

[Driftr]

Sept 28, 2012 7:32:44 GMT -5 The Virginian said:

True, I remember the first time I saw bottle water ( actually it was canned) I thought it was the funniest thing ever. As a youth I wondered why any person would ever want to buy water.

I still do.

As for Starbucks - I have never purchased anything from them. Probably never will.

Me neither.

[tyfighter3]

The only time I buy Bottled water is when we travel to Mexico. I can still see my wife Brushing Her teeth with BEER, LOL

[safeharbor37]

What's even odder is that "back in the day" many cities had water that was barely fit to drink [or just unfit] and the only "imported" water was the water cooler water at the office. I remember traveling in the 1940's and frequently the local water smelled like rotten eggs and was a sort of brown in color. Water filters kept sand from getting into the washers in spigots.
Last time I noticed, Consumer Reports used New York City water as the standard for good drinking water and none of the imported water matched its quality, but still millions of gallons of bottled water is sold in NYC annually.
By the way. I noticed that the DOW was down a hundred points this morning in anticipation of Moody's review of the Spanish economy [stress test] ~ like everyone didn't know that was coming. It's getting odder and odder.

[Driftr]

Anyone see the Chicago PMI this morning? Ouch...

"The Chicago Purchasing Managers reported September's Chicago Business Barometer fell to 49.7, its lowest level in three years...... Prices Paid showed the biggest gain in nearly two years."

www.ism-chicago.org/chapters/ism-ismchicago/files/ChicagoPMI-12-09.pdf

[decoy409]

Might have wanted to look at that a few days back. ;D

[safeharbor37]

Beginning a bear? Time to take profits? or just a temporary dip? Have anything to do with current politics? Is it likely to change at election time? depend on who wins? Disturbances and dislocations in Europe? long or short term trend?
What happens if a recession sets in in the middle of QEIII? What then? Where did all the stimulus money already spent go? What happens when it surfaces? or does it just disappear? Is Merkel to blame for austerity in Greece? Will European problems hamper recovery in the US? or is China more important?
Does anyone realize that the US is doing as well or better than [almost] anyone else? Does anyone care? if so, what does it mean? Is US doing as well as possible under the circumstances or could a change in policies make things significantly better?
Buy, sell or hold?

[2kids10horses]

Personally, I think we're still in a long term secular bear market. The excesses of the 1999-2000 market still haven't fully been worked out. (Secular market trends usually last about 20 years.) So, the recent bull market is just a ripple.

Note that while the Dow Industrials approached historic highs, the NASDAQ was nowhere close.

I agree that the markets are at a tipping point short term. Our fearless leader, AAPL, is having a cup of coffee.

[The Virginian]

Hey 10 Horse you have a point, What has propped up the DOW is people such as myself seeking the safety of Big name stocks and their Dividends, especially since you cannot get a decent rate of return from banks or any where else. A lot of the Tech and small caps provide neither. That's why people such as myself and WXYZ promote these Iconic stocks for the long term.

[ModE98]

A quarter of a century since Black Monday. Today is 25 years to the day since Black Monday, when the DJIA crashed 508 points, or nearly 23%. The collapse sparked fears of another depression, although a recession didn't come for two years and was relatively mild. The NYT has a retrospective blaming "portfolio insurance" and describing the crash as the "beginning of the destruction of markets by dumb computers."

Remember it well. Crashes and corrections are all part of the game. As are some Bull runs.

[The Virginian]

Yeah, back then it forced me out of the market. Today it wouldn't faze me ! It's kind of the way I feel about Global Warming - that the earth just goes through normal swings - well I now believe the market has normal swings also and those that can play their cards right are well rewarded

[ModE98]

To a seasoned investor, a sudden "panic" sell off really presents a golden opportunity to pick up top quality stocks for long term investment. What goes down, will in time work it's way up. From market history, it eventually builds to higher prices and good profit. Never panic, be wise and stay cool, keep your perspective and stay on course to reach your eventual investment goal.... a comfortable retirement.

[safeharbor37]

"You ain't seen nothin' yet." - Jimmy Durante (1893-1980) Entertainer.
I suspect we haven't.

[BeenThere...DoneThat...]

Nov 16, 2012 12:26:45 GMT -5 safeharbor37 said:

"You ain't seen nothin' yet." - Jimmy Durante (1893-1980) Entertainer.
I suspect we haven't.

...agreed...

...and, I went to buy a dozen mega-muffins at Costco... they used to be $4.99/doz... now they're sold in 6pks and you can mix and match for $6.99/doz... grrr...

[ModE98]

All hell may break loose at any time. BE PREPARED !!!

IF we get dragged into a Mid East war, expect a 50% or more drop in the markets. jmho, but it is possible. This is now a very troubled world teetering on the brink. Play your cards carefully, very close to the vest

[safeharbor37]

I actually added a little today. I'm not sure which way it'll go, but I'm prepared to ride out a drop and have enough cash to take advantage if it happens. I expect volatility for the next five years or so, but at some point we'll see another [real] bull ~ it's just that I don't know if I'll still be around or still involved ~ it's only if I am around that it'll make a difference so I have some freedom that younger people might not be able to take advantage of. What I hope to do is increase positions in order to be prepared for the eventual bull market. I'm not betting the milk money.
Things have gotten so good that people actually think that the current economic situation is analogous to the great depression and therefore are not in a position to learn anything. We're always at the edge of an abyss ~ or witnessing the dawn of utopia.

[safeharbor37]

I noticed today that when Boehner announced a "stalemate" in the discussions about the "fiscal cliff," the stock markets hardly noticed. That suggests to me that this has already been priced into the market and that, once a temporary solution has been achieved the markets are poised for a rally. There is a lot of money on the sidelines and it's not making a lot of money in CD's, Treasuries or other bonds. The little increase in the markets recently [at least the lack of a big decline] suggests that it isn't going lower in the near future ~ so ~ it might be time to nibble a bit [more].

[ModE98]

Makes reasonable sense to me, safe. The Republicans are caught between a rock and a hard place at the moment. A positive result may well set off a market rally.

[safeharbor37]

NEW YORK (Reuters) - Stocks swung back to positive territory in late morning trading on Wednesday, led by gains in Dow components Caterpillar and The Travelers , while Citigroup's 5 percent gain boosted bank stocks.
(Reuters) - Citigroup Inc, which has lagged behind its peers in recovering from the financial crisis, said it is cutting 11,000 jobs worldwide, about 4 percent of its staff, to save as much as $1.1 billion a year in expenses.

What does this tell you?

It is entirely possible that equities will prove to be the safest port in the coming storm.

[Trongersoll]

Dec 5, 2012 12:53:11 GMT -5 safeharbor37 said:

What does this tell you?

quote]

It tells me that there is 1.1 Billion less in taxable income for the Gov. to tax making it that much harder to decrease the deficit.

[Driftr]

Dec 5, 2012 14:19:35 GMT -5 Trongersoll said:

It tells me that there is 1.1 Billion less in taxable income for the Gov. to tax making it that much harder to decrease the deficit.

Unless that 1.1B results in additional US profit for the company. Probably at a pretty nice tax rate. Or am I misunderstanding?

[Trongersoll]

Dec 6, 2012 14:34:53 GMT -5 Driftr said:

Dec 5, 2012 14:19:35 GMT -5 Trongersoll said:

It tells me that there is 1.1 Billion less in taxable income for the Gov. to tax making it that much harder to decrease the deficit.

Unless that 1.1B results in additional US profit for the company. Probably at a pretty nice tax rate. Or am I misunderstanding?

No you aren't misunderstanding, it depends on what gets done with that 1.1 billion and how much would have been generated by those workers and how much it is going to cost to support them now that they are out of work.

[safeharbor37]

Looks like a Santa Rally. Perhaps it's only because there's no place else to go, but still here it is. The question is whether the gains in the market are enough to offset the eventual loss in the value of the dollar. Probably not.
It's kind of interesting that the value of the dollar is rapidly dropping in terms of what it will purchase, but is maintaining or even gaining on other currencies. This may be the predecessor of world-wide hyperinflation. I wonder which country or countries will come out on top if [when] that happens? Probably China and India. But why should that be when the US, Japan and Europe have a virtual monopoly on international currency. It may be instructive that Japan is still stuck in a decade long recession with no real light at the end of the tunnel.
I grabbed a little speculative stuff earlier. The question is whether to hold, take profits or buy more. Looking into 2013 is like staring into the abyss.

[safeharbor37]

Santa Rally go poof! but our representatives in Washington are going to work over the weekend to "solve" the problem.
Now ~ question is, Will their "solution" "solve" the problem and bring Santa after New Years? I'm long and plan to stay that way [subject to a change in opinion]. Will avoiding the "cliff" bring a "relief rally"? We'll see.
I'll be gone for a while through late January, February & March and will be tied up with income tax to April 15 [and maybe later] so I need to find a tenable position prior to late January. Currently, I plan to stay pat.

[BeenThere...DoneThat...]

...happy new year, to you, safe...

[ModE98]

This report seems to say "watch out below" .... is it believable? If so, warning flags are flying.

www.moneynews.com/MKTNews/billionaires--economist-stock/2012/08/29/id/450265?PROMO_CODE=110D8-1&utm_source=taboola