Will the stock market hold...or is the bubble ready to burst?

Not only is it panic, it's a bad idea to begin with. It's like me saying that all I need to avoid bankruptcy and losing my home isn't to get a job and actually earn money, I just need a larger credit line on all my credit cards so I can keep doing the balance transfer juggling act.

If your coworker or friend told you that's their plan you would say what an idiot. It'll never work.

But a politician says it and we all say great I hope it works.

It's a handy thing being Infallible, isn't it? :)

Though it looks like I was a little bit too optimistic.

Quote:

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Originally Posted by Kirkland Laing

It's a handy thing being Infallible, isn't it? :)

Though it looks like I was a little bit too optimistic.

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Must be in a good mood, Kirkland.;)

...Ok, folks. Most of you guys seem not to be aware of it but the economic situation now looks very, very grim. So far, the 700 million rescue package failed to do what it's supposed to do - get the credit market moving. The credit market got to get rolling! Or else, the already weakend consumption, housing and other investments - the foundation of the economy - are further weakened. When that happens, businesses are also weakened, naturally leading to more lay-offs. That further leads to lesser consumption and investments in a sort of chain reaction manner, until it reaches the pit. When that happens:-X... (I haven't got the heart to tell you what will happen.)


...but don't worry too much, you probably won't go hungry...

The $700 billion is a drop in the bucket, a pebble thrown into a churning ocean. This thing is going to cost many trillions. The Fed is now buying commercial paper and the commercial debt market is showing signs of life, but banks are all still terrified to lend to anybody else. Until we find out where the bodies are buried (may take years) that'll be the case. Until then the central banks will have to do everything, from guaranteeing commercial debt to effectively nationalising the banking industry in their respective countries. I'm still fairly confident that we'll avoid Armageddon but it's still a distinct possibility. The best-case scenario right now is a year to ten of recession, sluggish growth, economic contraction etc., while the global banking system deleverages and indivisual banks write off/pay down their debt/go out of business.

Just to explain, if the commercial debt market remains frozen large corporations can't roll their debt over and then they have to shut down part or all of their operations. Done on a global scale this would mean easily 20+% unemployment pretty much overnight, a new Depression in other words.

Private credit is another market that will need bailng out eventually. There aren't going to be too many interest-free offers being advertised on goods in the next decade.

So, as someone who is fairly ignorant of these matters and relies on someone else to invest their money for them, what is the appropriate action to take right now? Is it best to pull money out of investments before it becomes worthless or are we all pretty much fucked no matter what?

Quote:

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Originally Posted by Kirkland Laing

The $700 billion is a drop in the bucket, a pebble thrown into a churning ocean. This thing is going to cost many trillions. The Fed is now buying commercial paper and the commercial debt market is showing signs of life, but banks are all still terrified to lend to anybody else. Until we find out where the bodies are buried (may take years) that'll be the case. Until then the central banks will have to do everything, from guaranteeing commercial debt to effectively nationalising the banking industry in their respective countries. I'm still fairly confident that we'll avoid Armageddon but it's still a distinct possibility. The best-case scenario right now is a year to ten of recession, sluggish growth, economic contraction etc., while the global banking system deleverages and indivisual banks write off/pay down their debt/go out of business.

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Quote:

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Originally Posted by Kirkland Laing

Just to explain, if the commercial debt market remains frozen large corporations can't roll their debt over and then they have to shut down part or all of their operations. Done on a global scale this would mean easily 20+% unemployment pretty much overnight, a new Depression in other words.

Private credit is another market that will need bailng out eventually. There aren't going to be too many interest-free offers being advertised on goods in the next decade.

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Now, that's more like it, Kirkland, you're sober again. Nobody can say it better - than Mr. Laing.:)

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Originally Posted by CFH

So, as someone who is fairly ignorant of these matters and relies on someone else to invest their money for them, what is the appropriate action to take right now? Is it best to pull money out of investments before it becomes worthless or are we all pretty much fucked no matter what?

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As long as your investments are guaranteed, you can keep them where they are. But if not, think hard about it, I mean real seriously. If you are a rich guy, the traditional safe-haven investment for your millions :o will be gold. So invest all your money in the gold market as long as you think the crisis is there, but be ready to get out as soon as the crisis eases - precious metal market is very sensitive to market development.

What the heck did I say there...

Ok, CHF, let me try again. At the practical level, just keep your money where it is safe. But remember also that the time of crisis is also time of opportunity. In terms of investments, it's the time when prices will bottom out sooner or later. When it does, it's the time to invest, be it in real estate or in the stock market because there will be no other place to go but up. But you need to develop a bit of investment saviness to see and to take advantage of those opportunites. It's good time start learning though.

Quote:

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Originally Posted by pacfan

Now, that's more like it, Kirkland, you're sober again. Nobody can say it better - than Mr. Laing.:)

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Are you questioning my Infallibility, Mr. Pacfan? Why would anybody do that? I'll bet you a dollar my Infallibility is right again. The party is over baby. The largest, most uncontrolled credit expansion in history is over and now the global economy is going to have to pay the price.

BTW those commercial debt markets that I was saying were showing signs of life just shut down again. The whole system is in suspended animationagain. This really is not good at all.

BTW, the law prevents me from giving anybody specific financial advice of pretty much any kind, especially in the current somewhat nervous financial climate. So if you're wanting to know what to do with your money sorry.

Quote:

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Originally Posted by Kirkland Laing

Quote:

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Originally Posted by pacfan

Now, that's more like it, Kirkland, you're sober again. Nobody can say it better - than Mr. Laing.:)

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Are you questioning my Infallibility, Mr. Pacfan? Why would anybody do that? I'll bet you a dollar my Infallibility is right again. The party is over baby. The largest, most uncontrolled credit expansion in history is over and now the global economy is going to have to pay the price.

BTW those commercial debt markets that I was saying were showing signs of life just shut down again. The whole system is in suspended animationagain. This really is not good at all.

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Of course not, nobody has the nerve to question that except Lyle. But then I heard a rumor that he packs a six-shooters on his waist, two of 'em in his holsters; I just carry a slingshot.;D
I just thought that you were being unusually tame there in your first post yesterday. I was waiting for the usual fireworks...;)

Quote:

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Originally Posted by Kirkland Laing

BTW, the law prevents me from giving anybody specific financial advice of pretty much any kind, especially in the current somewhat nervous financial climate. So if you're wanting to know what to do with your money sorry.

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I didn't know that there was such a law...
...unless if you are one of the Feds...

Quote:

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Originally Posted by pacfan

Quote:

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Originally Posted by Kirkland Laing

Quote:

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Originally Posted by pacfan

Now, that's more like it, Kirkland, you're sober again. Nobody can say it better - than Mr. Laing.:)

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Are you questioning my Infallibility, Mr. Pacfan? Why would anybody do that? I'll bet you a dollar my Infallibility is right again. The party is over baby. The largest, most uncontrolled credit expansion in history is over and now the global economy is going to have to pay the price.

BTW those commercial debt markets that I was saying were showing signs of life just shut down again. The whole system is in suspended animationagain. This really is not good at all.

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Of course not, nobody has the nerve to question that except Lyle. But then I heard a rumor that he packs a six-shooters on his waist, two of 'em in his holsters; I just carry a slingshot.;D
I just thought that you were being unusually tame there in your first post yesterday. I was waiting for the usual fireworks...;)

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Ah, Lyle. I wish I'd known about Lyle years ago. Instead of having to spend years developing frameworks and strategies to negotiate the markets and having to deal with all the stress and tension that comes with that, all I actually had to do was phone Lyle, ask him what he would do then do exactly the opposite. :)

I'm not into making doom and gloom statements for fun, I'm not generally optimistic or pessimistic, all the way along with the current financial situation I've just tried to be realistic. And Infallibile of course. And if you read back over what I have Written in this thread I think the record bears me out.


If you work in the financial industry there are a lot of written and unwritten laws about what you can and can't do in public. I can't put a picture of myself up or even do Killersheep's sportsbook, and I definitely can't give financial adviceat any time , never mind right now.

Hey mate you wouldn't happen to know any good publications on the credit crisis that you would be able to give me a link to, would you?

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Originally Posted by Salty

Hey mate you wouldn't happen to know any good publications on the credit crisis that you would be able to give me a link to, would you?

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It's a bit too early for anybody to have written a book abou it yet. What do you want to know about?

Here's an article to wet your appetite. People who think we just fixed things don't realize the scope of the problem.


http://finance.yahoo.com/loans/artic...for-Themselves

http://farm4.static.flickr.com/3129/...09bd78.jpg?v=0


Broad Street, Manhattan,outside the NYSE, when the Dow went under 9000 today.

.....just a bit longer and it'll be time to put money in there (for certain stocks)

Quote:

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Originally Posted by Lyle

.....just a bit longer and it'll be time to put money in there (for certain stocks)

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You invested when the Dow was 13500. How did that work out for you?

Tomorrow sees $400 billion of Lehman Brothers assets being auctioned off. The price stuff went for will be officially announced to the rest of the financial community at 2PM but everybody will be following the auction all day. There could be some serious gyrations tomorrow, although it's possible today's mini-meltdown is just the market anticipating tomorrow.

What's good to invest in right now Lyle please?

This is fucked. I guess I'm going to have to reconcile myself to the fact that the money my mom left me via life-insurance could well be gone soon. I'm rather upset about it.

Oh well, who needs an education...

Quote:

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Originally Posted by Kirkland Laing

What's good to invest in right now Lyle please?

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General Mills, Duke Power, BB&T, WACHOVIA....there is opportunity out there. What would you do? I have lost money like everyone else but how often does this stuff happen AND the lowering of the prices make for better deals Wachovia isn't staying under $4 a share once it's absorbed by Citigroup or Wells Fargo.


Wachovia is the only risky choice I have on there...BB&T did a great job and is a solid bank

...wait a second, guys, not just yet. Wait for the market to bottom out. No doubt there are some fire-sales going on out there now, but who knows, things can go from bad to worst real quickly in the coming weeks or months. We're definitely sailing on unchartered territory and it's really very risky to cross there at this point. Things are very hazy now; nobody know for sure where we're heading. Of course, if you take a that risk right now, you will make a real big jackpot if things turned out even just a little better. But again, that's another big iffy thing, and an extremely questionable one at that...

BB&T was very conservative in the loans they gave out

Wachovia is getting ready to be bought out by either Citigroup or Wells Fargo both solid companies


General Mills is used every day by everyday people no matter what the crisis.


Buy stock that is a product people use, Gillette is a good one.


Duke Power is energy if that goes bad then I could give a fuck about the money I wasted on it I'd be more worried about what is turning on my lights and running my refrigerator.




I mean that's what I will do...I'm not trying to sway anyone one way or another, I could give two shits about what yall do with your money

...and don't forget, Iceland is reportedly on a verge of financial collapse, or simply put - bankrupt...

...who's next? Things are looking real, real bad, so you better all brace yourselves and pray hard...

Quote:

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Originally Posted by Lyle

BB&T was very conservative in the loans they gave out

Wachovia is getting ready to be bought out by either Citigroup or Wells Fargo both solid companies


General Mills is used every day by everyday people no matter what the crisis.


Buy stock that is a product people use, Gillette is a good one.


Duke Power is energy if that goes bad then I could give a fuck about the money I wasted on it I'd be more worried about what is turning on my lights and running my refrigerator.




I mean that's what I will do...I'm not trying to sway anyone one way or another, I could give two shits about what yall do with your money

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Of course, Lyle, if you take the risk, you can be a zillionaire if things improve. Some of the stocks are sold for just a fraction of what they used to sell just couple of months back. If these companies are successfully revived, then their shares price should bounce back real big. But you need to have a real market saviness to be able to correctly see which ones have the potential for that. With all my knowledge of Economics and business, I wouldn't dare...

That's a fair view of things BUT I'm betting things will improve...now when they improve and what improves are the questions

Quote:

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Originally Posted by Lyle

That's a fair view of things BUT I'm betting things will improve...now when they improve and what improves are the questions

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Of course, if you're a gambler, it's your chance to go for that once in a lifetime, naw, it's more like once in a century, chance to be millionare...



...But for the rest of you timid folks, especially those with millions, it's time for you to dump 'em into the gold market - that's where you put 'em when there's crisis. Me, I've got know such problem - I'm just a poor fisherman who's worried about the pollution more than the stock market. Can someone put $1,100 for me there at the 'how much you earn' thread?;D

Well I'm young and I have time to spare, I have the opportunity to gamble and not have it hurt me in the long run.

Quote:

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Originally Posted by Lyle

Well I'm young and I have time to spare, I have the opportunity to gamble and not have it hurt me in the long run.

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Well, then, by all means go for it...

...and good luck!;)



...by the way, where's Kirkland? He's been unusually silent today.

Quote:

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Originally Posted by pacfan

...and don't forget, Iceland is reportedly on a verge of financial collapse, or simply put - bankrupt...

...who's next? Things are looking real, real bad, so you better all brace yourselves and pray hard...

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So is Pakistan. They're begging for a hundred billion bailout. An Islamic failed state with nuclear weapons. Excellent.





Miserable enough for you?

Statement from the Bank of Jamaica regarding the global financial crisis :


http://farm4.static.flickr.com/3166/...c02755.jpg?v=0

Quote:

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Originally Posted by pacfan

Quote:

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Originally Posted by Lyle

BB&T was very conservative in the loans they gave out

Wachovia is getting ready to be bought out by either Citigroup or Wells Fargo both solid companies


General Mills is used every day by everyday people no matter what the crisis.


Buy stock that is a product people use, Gillette is a good one.


Duke Power is energy if that goes bad then I could give a fuck about the money I wasted on it I'd be more worried about what is turning on my lights and running my refrigerator.




I mean that's what I will do...I'm not trying to sway anyone one way or another, I could give two shits about what yall do with your money

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Of course, Lyle, if you take the risk, you can be a zillionaire if things improve. Some of the stocks are sold for just a fraction of what they used to sell just couple of months back. If these companies are successfully revived, then their shares price should bounce back real big. But you need to have a real market saviness to be able to correctly see which ones have the potential for that. With all my knowledge of Economics and business, I wouldn't dare...

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How do you even go about buying stock? Do you have to talk to your banker? Or what?

And is there a certain amount of money you have to invest, or can you invest just enough so that if it goes wrong, you're not really losing that much?

Well, we got gyrations alright.

For those of you worried about the global financial crisis, I thought I'd explain exactly what will happen over the coming weeks, months and years and the eventual future financial, political and geopolitical/geostrategic consequences of current events so that you know what's coming in the years and decades ahead (not all in one post, but in this thread eventually). And there's good news! The Chairman of the Fed and the U.S. Secretary to the Treasury have now finally started to accept my advice and we're going to see the effective nationalisation of the banking system.

They don't have time to carry out their original plan as events have already overtaken it, so that's good news for US taxpayers as the initial $700 billion they recently shelled out will now be spent sensibly. The problem causing the current meltdown is that banks don't want to lend to business or themselves anymore. Nobody knows who might go bust next week so everybody is terrified to lend to everybody else. And if banks stop lending to each other and business then our largest businesses and corporations, which rely on bank lending to roll over their short-term debt, hit a cashflow wall. They have to lay off thousands of staff, who have no wages to spend, which means the overall economy slows down due to their lost spending, which creates more job losses in businesses affected by the lack of spending, which creates a vicious spiral of job losses and so on, so this is why investors are all currently running for the exits. Basically eventual mass unemployment. A Depression. And we'd all like to avoid that.

So governments are going to step in and recapitalise banks, giving them big chunks of money to plug the holes in their balance sheets caused by them buying now-worthless mortgage securities and other crap paper.

So we're going to see a part-nationalisation of the whole banking system and we may even see full nationalisation, and sooner rather than later. If asset prices continue to fall and so reducing the value of the non-crap assets on banks' balance sheets then the recapitalisation money is just throwing money into a black hole. So the eventual outcome may well be the complete nationalisation of the banking system. Then governments can order banks to lend to each other and allow the normal flow of credit creation to resume and asset prices will stablilise.

So there'll be an initial bank recapitalisation plan announced in the next few days and subsequent plans announced at strategic points afterwards, with the general idea of preparing the populations of our countries to accept the fact that the banking system is going Commie, something that will be hard to swallow in certain countries, especially countries with upcoming Presidential elections. This new plan has the working title of "The Kirkland Laing Global Financial System Rescue Plan" but this may be subject to a change before it's eventually made public. But it will happen. It is Written.


A great deal of the current meltdown is directly due to the inept and arrogant way in which the U.S. President, the Chairman of the Fed and other officials both in the US and in other countries have dealt with the crisis, especially in the way they originally arrogantly assumed that they could deal with it without first asking for and then acting on my advice. Bush made the same arrogant mistake over the invasion of Iraq and numerous other issues over the course of his presidency too.

I hate arrogance like that in a person, don't you?









:)

Quote:

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Originally Posted by Kirkland Laing

Well, we got gyrations alright.

For those of you worried about the global financial crisis, I thought I'd explain exactly what will happen over the coming weeks, months and years and the eventual future financial, political and geopolitical/geostrategic consequences of current events so that you know what's coming in the years and decades ahead (not all in one post, but in this thread eventually). And there's good news! The Chairman of the Fed and the U.S. Secretary to the Treasury have now finally started to accept my advice and we're going to see the effective nationalisation of the banking system.

They don't have time to carry out their original plan as events have already overtaken it, so that's good news for US taxpayers as the initial $700 billion they recently shelled out will now be spent sensibly. The problem causing the current meltdown is that banks don't want to lend to business or themselves anymore. Nobody knows who might go bust next week so everybody is terrified to lend to everybody else. And if banks stop lending to each other and business then our largest businesses and corporations, which rely on bank lending to roll over their short-term debt, hit a cashflow wall. They have to lay off thousands of staff, who have no wages to spend, which means the overall economy slows down due to their lost spending, which creates more job losses in businesses affected by the lack of spending, which creates a vicious spiral of job losses and so on, so this is why investors are all currently running for the exits. Basically eventual mass unemployment. A Depression. And we'd all like to avoid that.

So governments are going to step in and recapitalise banks, giving them big chunks of money to plug the holes in their balance sheets caused by them buying now-worthless mortgage securities and other crap paper.

So we're going to see a part-nationalisation of the whole banking system and we may even see full nationalisation, and sooner rather than later. If asset prices continue to fall and so reducing the value of the non-crap assets on banks' balance sheets then the recapitalisation money is just throwing money into a black hole. So the eventual outcome may well be the complete nationalisation of the banking system. Then governments can order banks to lend to each other and allow the normal flow of credit creation to resume and asset prices will stablilise.

So there'll be an initial bank recapitalisation plan announced in the next few days and subsequent plans announced at strategic points afterwards, with the general idea of preparing the populations of our countries to accept the fact that the banking system is going Commie:-X, something that will be hard to swallow in certain countries, especially countries with upcoming Presidential elections. This new plan has the working title of "The Kirkland Laing Global Financial System Rescue Plan" but this may be subject to a change before it's eventually made public. But it will happen. It is Written.


A great deal of the current meltdown is directly due to the inept and arrogant way in which the U.S. President, the Chairman of the Fed and other officials both in the US and in other countries have dealt with the crisis, especially in the way they originally arrogantly assumed that they could deal with it without first asking for and then acting on my advice. Bush made the same arrogant mistake over the invasion of Iraq and numerous other issues over the course of his presidency too.

I hate arrogance like that in a person, don't you?

:)

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Nothing much to add except to stress that they must get the credit rolling again, or else it's a sure crash...

...so apparently it has come to the point of getting the credit rolling again at all costs, even at the point of nationalising the banks - do we have the choice? I guess not. That's the most bitter pill they have to take - or more like - to bite.

Hmmm, maybe the guy who stands at the intersection to my university holding signs is right... Maybe the global financial crisis IS all part of the devils plan to institute a new world order by 2013.

Quote:

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Originally Posted by Clubber

How do you even go about buying stock? Do you have to talk to your banker? Or what?

And is there a certain amount of money you have to invest, or can you invest just enough so that if it goes wrong, you're not really losing that much?

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Clubber, there are lot's of ways to invest in stocks, even just thru the internet. But you don't just go in there and buy them without knowing much about them. First thing first. First, you have to learn about investing in stocks. You can do that by reading some books about them or even studying some infos about them on the net.

During normal times, what people who don't know much about stocks do is to find a reputable and reliable mutual funds company and let them invest your money - they have all the expertise to do that for you. But for now, since it's not normal times these day, the best thing to do is to put your money in the bank - I'm pretty sure they're guaranteed so it's safe there...

Quote:

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Originally Posted by pacfan

Quote:

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Originally Posted by Clubber

How do you even go about buying stock? Do you have to talk to your banker? Or what?

And is there a certain amount of money you have to invest, or can you invest just enough so that if it goes wrong, you're not really losing that much?

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Clubber, there are lot's of ways to invest in stocks, even just thru the internet. But you don't just go in there and buy them without knowing much about them. First thing first. First, you have to learn about investing in stocks. You can do that by reading some books about them or even studying some infos about them on the net.

During normal times, what people who don't know much about stocks do is to find a reputable and reliable mutual funds company and let them invest your money - they have all the expertise to do that for you. But for now, since it's not normal times these day, the best thing to do is to put your money in the bank - I'm pretty sure they're guaranteed so it's safe there...

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That's what I did. I followed the advice I was given when all I really wanted to do was keep it in the bank. :-\

I wouldn't feel so bad if it was my own money, but it was the cash I got from my mom's life insurance for my education, so I find it particularly hard to deal with atm. I'm thinking of pulling what's left out of the funds and sticking it in the bank...

Quote:

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Originally Posted by CFH

Hmmm, maybe the guy who stands at the intersection to my university holding signs is right... Maybe the global financial crisis IS all part of the devils plan to institute a new world order by 2013.

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:oHmmm... that's really something to think about, CFH...

...actually, I'd sort of seen it coming but I don't want to start an ugly religious discussion so I'll keep it to myself:-X...

;)

Quote:

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Originally Posted by pacfan

Quote:

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Originally Posted by CFH

Hmmm, maybe the guy who stands at the intersection to my university holding signs is right... Maybe the global financial crisis IS all part of the devils plan to institute a new world order by 2013.

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:oHmmm... that's really something to think about, CFH...

...actually, I'd sort of seen it coming but I don't want to start an ugly religious discussion so I'll keep it to myself:-X...

;)

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I actually kind of admire that crazy bastard in a way (the dude with the signs, not the devil), it takes a lot of guts to do what he's doing, even if he comes across as a total nut.