Markets in a tailspin

[shady28]

No that is the proper way to think you can actually hit the peaks and troughs, when in reality you have a better chance of getting hit by lightning INDOORS.

Spoken like someone who has never ever looked at a stock chart in their life.

Here, let me show you a couple.

http://www.metastock.com/Customer/Resources/TAAZ/?c=3&p=50

The Third phase is characterized by record corporate earnings and peak economic conditions. The general public (having had enough time to forget about their last "scathing") now feels comfortable participating in the stock market--fully convinced that the stock market is headed for the moon. They now buy even more stock, creating a buying frenzy. It is during this phase that those few investors who did the aggressive buying during the First phase begin to liquidate their holdings in anticipation of a downturn.

 

[LegendKiller]

There is a proper way to read a chart for analysis.

http://www.investopedia.com/articles/technical/02/070302.asp


Read the thread, I already stated a range when I thought the bottom would occur. It isn't anytime soon.

I also didn't say a damn thing about debt being serviceable or not, I simply listed debt as one of the characteristics of a top.

Another characterization is heavy participation by laymen, and a very speculative market.

This thread just reinforces that. The lemmings are not just going off the cliff, they're doing it with fervor.

If you want to perform a peak to trough analysis, or a technical analysis (which are dubious, at best since they don't have a solid correlation for returns) then fine, but to somehow reframe the question is...questionable.

How is it a characteristic of the top? Your analysis is a single variable regression. What is the R^2 of that regression? How can you prove that it has any bearing on whether the top is in, or that even if the "top" is in, that it had any correlative rationale? (Correlation does not infer causation).

I still don't see a date, could you link the post? I guess on a long enough horizon you could hit a black swan and be "correct", a broken clock is right twice a day and Ron Paul has shit out more nuts than a blind squirrel finds randomly. But ok.

 

[LegendKiller]

Spoken like someone who has never ever looked at a stock chart in their life.

Here, let me show you a couple.

http://www.metastock.com/Customer/Resources/TAAZ/?c=3&p=50

Hey, just a quick question, could you tell me the regression for technical analysis and whether, without being able to study market microstructure using high speed networks and computers, whether it actually works for the majority of investors, in a statistically significant and peer reviewed study, such as one published in the FAJ?

Additionally, could you tell me how many 100% technical analysis investors, who don't have access to high speed networks/systems/algorithms/special access...etc are worth $1bn+. $500mm? 250mm? 100mm?

Just curious.

Just waiting for Elliott Waves to be busted out. Then I'll know you jumped the shark.

 

[Blanky]

Any commonly accessible technical analysis by definition can't work because it's available to everyone and so would influence the market, therefore taking it to the point again that it can't work.

 

[LegendKiller]

Any commonly accessible technical analysis by definition can't work because it's available to everyone and so would influence the market, therefore taking it to the point again that it can't work.

Of course it can't, even in a weak EMH world.

But I'm just waiting for him to try and argue it can.

I do enjoy how he's trying to spin the conversation from a simple analysis of return points to debating whether you can do that under TA "theory". Eski was never arguing TA, he was arguing entry/exit points and not trying to divine anything from the charts other than picking where to begin and end an analysis. That is why shady decided to say "you are reading the charts wrong according to TA". He is trying to reframe the discussion because he knows he can't win against Eski's argument.

Shady is a huckster.

And yes, I am defending Eski, because he is right (in this case).

 

[IronWing]

Chart reading would be an awesome way to invest if I could just get the charts ahead of time.

 

[realibrad]

And yes, I am defending Eski, because he is right (in this case).

He does get annoying like that sometimes.

 

[Thump553]

Chart reading would be an awesome way to invest if I could just get the charts ahead of time.

That's the whole basis of high speed trading-you get the info and can act on it a few microseconds before the vast majority of the market.

I may be wrong but the current downturn in the market doesn't worry me much. I don't have an immediate need for the funds I have invested in the market and I believe the fundamentals of the US economy are at least as strong as they have been in a decade. OTOH I have no faith in the bubble that is Red China and their so-called stock market in particular. I'll insulate my investments as much as possible from China and continue on. The US market's downturn is almost purely emotion hysteria by the so-called professional traders.

I view China now as much the same as Japan was viewed in the 70s and 80s when there was much hand wringing here how Japan was eating the USA's lunch. I think China will crash a lot harder and further than Japan did as so much of their boom was based on smoke and mirrors.

 

[fskimospy]

That's the whole basis of high speed trading-you get the info and can act on it a few microseconds before the vast majority of the market.

Basically. I have a friend who owns a company that builds ultra low latency interconnects for the big banks here in NYC. You would be amazed/horrified/saddened by how much money they spend to shave off tiny amounts of latency. (especially considering the limited macroeconomic utility of it)

 

[LegendKiller]

That's the whole basis of high speed trading-you get the info and can act on it a few microseconds before the vast majority of the market.

I may be wrong but the current downturn in the market doesn't worry me much. I don't have an immediate need for the funds I have invested in the market and I believe the fundamentals of the US economy are at least as strong as they have been in a decade. OTOH I have no faith in the bubble that is Red China and their so-called stock market in particular. I'll insulate my investments as much as possible from China and continue on. The US market's downturn is almost purely emotion hysteria by the so-called professional traders.

I view China now as much the same as Japan was viewed in the 70s and 80s when there was much hand wringing here how Japan was eating the USA's lunch. I think China will crash a lot harder and further than Japan did as so much of their boom was based on smoke and mirrors.

But as I clearly delineated, those guys aren't doing "technical analysis" through charts. They are doing fundamental and/or relative analysis through incrimental pieces of information arbitrage. That isn't the "technical analysis" that shady is discussing. His whole "top" vs "bottom" astrology chart reading bullshit is not what real high speed traders use. Furthermore, they aren't trading with those charts on etrade, they have ultra bandwidth microwave data transmissions and effectively supercomputers.

Finally, you can't divine thousands of variables from charts, from central bank moves to multinational m&a deals that can effect everything from global trade to currency swaps.


That is why technical analysis, (that shady does) is a joke.

 

[overst33r]

Basically. I have a friend who owns a company that builds ultra low latency interconnects for the big banks here in NYC. You would be amazed/horrified/saddened by how much money they spend to shave off tiny amounts of latency. (especially considering the limited macroeconomic utility of it)

Yep. 300 million to shave off 4ms from NY to London.

http://www.bloomberg.com/news/artic...ss-atlantic-aims-to-save-traders-milliseconds

 

[LegendKiller]

I do love his 50% off market call. I am sure he spent countless hours pouring over data, equity anf credit analyst calls, earnings, central bank policy analyst calls, talking with other fund managers to come up with a solid actionable theory that can be pinpointed like his ludicrous astrology reading. After all, I am sure he is short the appropriate options at the right time, according to his charts, and they are so far out of the money now that his carry is limited


After all, that is what the smart money, with access to all of that, is doing right now too, right?


Schiff is worth more than anybody on the planet right now because of his adroit shorting, same with Ron Paul.

Right?

 

[bshole]

I do love his 50% off market call. I am sure he spent countless hours pouring over data, equity anf credit analyst calls, earnings, central bank policy analyst calls, talking with other fund managers to come up with a solid actionable theory that can be pinpointed like his ludicrous astrology reading. After all, I am sure he is short the appropriate options at the right time, according to his charts, and they are so far out of the money now that his carry is limited


After all, that is what the smart money, with access to all of that, is doing right now too, right?


Schiff is worth more than anybody on the planet right now because of his adroit shorting, same with Ron Paul.

Right?

The last two large downturns had a definable links to the economy, (the .Com bust and the mortgage implosion). That is why I am going to stick although Shady had me going there for a while.

 

[LegendKiller]

The last two large downturns had a definable links to the economy, (the .Com bust and the mortgage implosion). That is why I am going to stick although Shady had me going there for a while.

He might be right, he might be wrong. But if he is right it's not because some magical graph a chartist created came true, or that debt is high. Perhaps it is China collapsing, or Saudi collapsing that puts oil at 200, or a big bank going under because of a large derivative loss. I am sure shady will be in here saying "I told you so" but it won't be because what he said. He will try and spin it though.

 

[shady28]

He might be right, he might be wrong. But if he is right it's not because some magical graph a chartist created came true, or that debt is high. Perhaps it is China collapsing, or Saudi collapsing that puts oil at 200, or a big bank going under because of a large derivative loss. I am sure shady will be in here saying "I told you so" but it won't be because what he said. He will try and spin it though.

I'm no longer alone in that view...


Sell everything ahead of stock market crash, say RBS economists

Bearish J.P Morgan says sell stocks on any rally

 

[LegendKiller]

I'm no longer alone in that view...


Sell everything ahead of stock market crash, say RBS economists

Bearish J.P Morgan says sell stocks on any rally

So did your magical charts tell you that or did the collapse in China, that I mentioned, the collapse in railcar, port traffic, Baltic Dry, Energy complex, and the continual pumping from Saudi Arabia do it?

I was right, you'd be in here all "Hey, my charts told you so!" but you have no appreciation, or knowledge, of the financial markets.

 

[shady28]

So did your magical charts tell you that or did the collapse in China, that I mentioned, the collapse in railcar, port traffic, Baltic Dry, Energy complex, and the continual pumping from Saudi Arabia do it?

I was right, you'd be in here all "Hey, my charts told you so!" but you have no appreciation, or knowledge, of the financial markets.

I just brought it back up to piss you off. You'll be even more pissed as I become increasingly correct.

 

[LegendKiller]

I just brought it back up to piss you off. You'll be even more pissed as I become increasingly correct.

Being correct doesn't matter. What matters is why you are correct and whether you can replicate it in the long run. That is why there are no wealthy chartists on the level of buffet or drukenmiller or soros, or anybody else. You are looking in the rear view mirror hoping to be right once in a while. Meanwhile others are right far more often because they understand fundamental analysis.

I already told you why you might be correct, but it wasn't because of a chart. Did I not?

 

[shady28]

Being correct doesn't matter. What matters is why you are correct and whether you can replicate it in the long run. That is why there are no wealthy chartists on the level of buffet or drukenmiller or soros, or anybody else. You are looking in the rear view mirror hoping to be right once in a while. Meanwhile others are right far more often because they understand fundamental analysis.

I already told you why you might be correct, but it wasn't because of a chart. Did I not?

Being right matters immensely. But regardless, I never advocated timing the market to a day or month or quarter even. The charts provide perspective as to where one is in the economic cycle.


And speaking of Soros :

Soros warns a replica of 2008 crisis looming

 

[LegendKiller]

Being right matters immensely. But regardless, I never advocated timing the market to a day or month or quarter even. The charts provide perspective as to where one is in the economic cycle.


And speaking of Soros :

Soros warns a replica of 2008 crisis looming

Broken clocks are right twice a day. Big fucking deal.

Of course soros would say that. He wants to buy shit cheap. It is like t Boone Pickens saying oil would never go below 150 a barrel. Or countrywide saying their bonds were perfect.

Like 2008? How? What Financials are going to collapse?

 

[Kwatt]

Like 2008? How? What Financials are going to collapse?

While not making a prediction or even raising a possibility.

I can see any "Financials" that are over exposed to the fracking oil industry or the sub-prime auto lending getting into trouble.

Although it is never what you see coming that gets you it is what sneaks up on you.

.

 

[LegendKiller]

While not making a prediction or even raising a possibility.

I can see any "Financials" that are over exposed to the fracking oil industry or the sub-prime auto lending getting into trouble.

Although it is never what you see coming that gets you it is what sneaks up on you.

.

How big is the fracking industry financial outstanding relative to bank holdings?

What about subprime autos?

How many subprime auto securitization bondholders lost a penny through the crisis?

It is easy to listen to zero hedge and panic. It is quite another to understand market fundamentals.

 

[Kwatt]

How big is the fracking industry financial outstanding relative to bank holdings?

I have no idea. Or how much as derivatives if any.

What about subprime autos?

Same response as above.

How many subprime auto securitization bondholders lost a penny through the crisis?

I have no idea. Did any lose a penny in the subprime mortgage problem? That whole pesky thing that was not in a bubble and not a cause for concern.

It is easy to listen to zero hedge and panic. It is quite another to understand market fundamentals.

It is easy to discredit anything I don't agree with. Doing so has caused me some concern in the past though.


.

 

[fskimospy]

How big is the fracking industry financial outstanding relative to bank holdings?

What about subprime autos?

How many subprime auto securitization bondholders lost a penny through the crisis?

It is easy to listen to zero hedge and panic. It is quite another to understand market fundamentals.

The problem I see with Zerohedge and people like Peter Schiff is that they are *always* predicting disaster. It doesn't matter how many times they have been wrong, it's always the same thing. Sooner or later they are bound to be right, at which point they will trumpet their prescience, ignoring the huge number of nearly identical wrong predictions in their wake.

 

[MongGrel]

Another "The Sky is Falling" thing it looks.