I agree with Ferret, but I think there are people flocking to the blue chips right now as well. There are some very good companies, with good EPS, and good dividends as well.
I think the sentiment right now is get out of growth and look for good yielding value equity...
At any rate there is likely to be quite a bit of porpoising in the coming weeks...
Here is the biological definition and reasoning behind porpoising...interesting correlation to the market: link
PeakOil is You
Markets and the Dead Cat Bounce
Re: Markets and the Dead Cat Bounce
by Delphis » Tue 30 Sep 2008, 11:58:00
"Two things are infinite: the universe and human stupidity; and I'm not sure about the universe."....Albert Einstein
-
Delphis - Peat
- Posts: 169
- Joined: Tue 09 Sep 2008, 03:00:00
- Location: Hobbiton, but it's looking more like Mordor by the day...oh! hey Sauron, I didn't see you behind me!
Re: Markets and the Dead Cat Bounce
by ohcomeon » Tue 30 Sep 2008, 12:00:32
$this->bbcode_second_pass_quote('deMolay', 'K')ey Phrase. ``The money markets have completely broken down, with no trading taking place at all,'' said Christoph Rieger, a fixed- income strategist at Dresdner Kleinwort in Frankfurt. ``There is no market any more. Central banks are the only providers of cash to the market, no-one else is lending.''
-
ohcomeon - Peat
- Posts: 119
- Joined: Sat 10 Jun 2006, 03:00:00
- Location: USA
Re: Markets and the Dead Cat Bounce
by deMolay » Tue 30 Sep 2008, 12:34:45
Jason how did you hijack my thread?
"We Are All Travellers, From The Sweet Grass To The Packing House, From Birth To Death, We Wander Between The Two Eternities". An Old Cowboy.
-
deMolay - Intermediate Crude
- Posts: 2671
- Joined: Sun 04 Sep 2005, 03:00:00
Re: Markets and the Dead Cat Bounce
by rockdoc123 » Tue 30 Sep 2008, 14:54:57
The biggest worry right now is that Libor is above 6% which is somewhat unprecidented. Basically no one is lending money to anyone. This has far reaching consequences for all aspects of business if it continues for any length of time.
Difficult to say whether bottom has been reached yet. The volatility index is higher now than in the past 4 years which means fear and panic are rampant in the markets.
Big question will be how long this recession will last. the normal 11 month average rule probably doesn't hold given all the tendrils the credit collapse has in all areas of the economy.
One interesting point I make is that this particular set of events will eventually drive oil to higher levels than we have seen. The lack of investment capital available means that fewer wells will be drilled. Companies like Cheseapeake drill thousands of gas wells a year and finance them through the markets. Lower gas prices coupled with equity drying up means little new drilling and some wells shutin (Chesepeake announced some shutins last week). Big offshore projects often depend on project financing which will just be too expensive to obtain. The drop in oil prices further determines these investments will be the first to get shelved. So going forward, less drilling equals less oil and gas. Smaller O&G firms are dependant on investors and they are now running for the hills. Larger companies who may have cash on hand could potentially orchestrate a number of takeovers/mergers. Again the outcome of this is fewer companies drilling, less oil being produced overall. My bet is on short term retreat of oil to $85.....then rise again to $170 or higher within a two year period.
Difficult to say whether bottom has been reached yet. The volatility index is higher now than in the past 4 years which means fear and panic are rampant in the markets.
Big question will be how long this recession will last. the normal 11 month average rule probably doesn't hold given all the tendrils the credit collapse has in all areas of the economy.
One interesting point I make is that this particular set of events will eventually drive oil to higher levels than we have seen. The lack of investment capital available means that fewer wells will be drilled. Companies like Cheseapeake drill thousands of gas wells a year and finance them through the markets. Lower gas prices coupled with equity drying up means little new drilling and some wells shutin (Chesepeake announced some shutins last week). Big offshore projects often depend on project financing which will just be too expensive to obtain. The drop in oil prices further determines these investments will be the first to get shelved. So going forward, less drilling equals less oil and gas. Smaller O&G firms are dependant on investors and they are now running for the hills. Larger companies who may have cash on hand could potentially orchestrate a number of takeovers/mergers. Again the outcome of this is fewer companies drilling, less oil being produced overall. My bet is on short term retreat of oil to $85.....then rise again to $170 or higher within a two year period.
-
rockdoc123 - Expert
- Posts: 7685
- Joined: Mon 16 May 2005, 03:00:00
Re: Dow closes down -777.68 Is this the largest 1-day drop?
by paimei01 » Tue 30 Sep 2008, 15:53:18
Dive dive dive ! 
- paimei01
- Tar Sands
- Posts: 539
- Joined: Tue 27 Feb 2007, 04:00:00
- Location: Romania
Re: Dow closes down -738.08 Is this the largest 1-day drop?
by emersonbiggins » Tue 30 Sep 2008, 16:01:08
$this->bbcode_second_pass_quote('emersonbiggins', '')$this->bbcode_second_pass_quote('messageinabottle', '')$this->bbcode_second_pass_quote('IgnoranceIsBliss', 'D')own 748 according to CNBC right now. Biggest drop since 1987.
Down 770.59 right now..
I thought markets closed over 15 minutes ago? Why is it STILL DROPPING????
After-hours trading. Look for the futes to be wildly up or down tomorrow morning. My vote is for down, down, down.
Up almost 500 today. Feel free to use me as a contrarian indicator.
"It's called the American Dream because you'd have to be asleep to believe it."
George Carlin
George Carlin
-
emersonbiggins - Expert
- Posts: 5150
- Joined: Sun 10 Jul 2005, 03:00:00
- Location: Dallas
