Was yesterday’s price uptick a sign of recovery or just one of those deadcat bounces that tempt us to put more money into a rathole? In other words, like an old lover who has already broken your heart a dozen times, is the old bull knocking on the door again? IMO, here’s a message for the old bull!
The Market Report (TMR on TMR!) 11-14-08: A Timeless Message to the Markets
Submitted by Knight_of_the_Mind on Fri, 2008-11-14 07:51.
Tell them what they want to hear, and they will rally.
Replacing 401k's will be the Obama Hotel CA retirement package...
You can check out any time you like, but you can't afford to leave!
Submitted by speciallist on Fri, 2008-11-14 08:00.
'Authentic Italian Weekly Pain Report'..........logo later
"40 million American households that read TMR are generally happier
than those people in households that don't read TMR."
Submitted by DocJ on Fri, 2008-11-14 08:22.
BTW Street - echoing some others here - thanks for these weekly reports.
I have a feeling they're going to get, erm, more interesting as The Healing Power of The One starts to take hold.
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Diplomacy is the art of saying 'Nice doggie' until you can find a rock.
Submitted by Marcus Traianus on Fri, 2008-11-14 12:01.
Under Democrats the $700 billion is now becoming a giant slush fund.
We have automobile companies that frankly would be better off going bankrupt because once and for all our country could break the stranglehold unions have on killing that industries competitiveness. But since unions are the number one financial backer of Democrats, the market is figuring there will be a bailout to keep the unions in tact. After all, we would not want to lose the $100k a year factory janitors.
We also have poorly run, mostly Democrat cities like Atlanta and Philadelphia looking for a piece of the pie. They too, would be better off with substantial fiscal restructuring and an incentive to actually increase their debt rating. But the market is moving towards a reality these cities may also be bailed out.
Witness Dodd and Frank, probably the two biggest government culprits (would be felons, if they were in the private sector) in this entire fiscal mess feigning outrage over various issues. Most people don't realize they were personally responsible for the Fannie/Freddie debacle (stopping reform legislation as they were taking huge lobbying sums from them) because the MSM will not print the truth. They are also chairmen of the most powerful financial committees in Congress, which means also the biggest recipients of financial industry lobbying money (don't trust me, look it up at Open Secrets). These guys are still running the show for Democrats and have not proposed any changes in CRA or FHA which are responsible for creating the entire Subprime mess. In fact, they are proposing the opposite; bailing out people with payments, etc. when in the end they still will not be able to afford their houses. Sorry, the market know this is a recipe for additional disaster and the entire aforementioned paragraph is a big part of the reason no FI wants to lend.
Finally, there are Obama's plans (whatever was actually articulated in the election, which by the way changed each week) that were calculated at about $1 trillion in new goverment spending. This is frightening to the market, since government contraction, not expansion is what the economy needs.
Overall, we have a rise in unemployment, lower retail sales and less economic activity in general. We have a government largely taking over key sectors of our economy, making the fallacious allegation they have the answers. I suppose the market is therefore also pricing in an expectation government will do for these sectors, what they did for Fannie and Freddie- destroy them.
Get used to seeing Obama doing the "cat drop", trying to land on his feet by not taking a position until January. Expect after that to see gratutitous allusions to "Bush", Republicans and "free markets" as the basis for our predicament. This of course ignores the general concept that markets rise and fall as a matter of cycles, not because they are "free". This will all be an excuse for Democrats and their Dear Leader to undertake a radical destruction of our economy.
My advise to Republicans? Implore a temporary suspension of the capital gains tax and corporate income tax. Combine this with a program to gradually restore rates to a percentage lower than existing rates. You want to attract capital and restore general liquidity? Put money in the hands of people who have built our countries great economy for centuries; the people and our industry. In case you missed it, this does not include the government.
"Dulce et decorum est pro patria mori"
It's been said that markets do whatever is necessary to hurt the most people.
That is why prices sometimes shoot higher when news flow, investor sentiment and speculative positions are skewed to the negative, and why rampant euphoria is occasionally the set-up for a violent correction.
Replacing 401k's will be the Obama Hotel CA retirement package... You can check out any time you like, but you can't afford to leave!