masterxfob
Diamond Member
- May 20, 2001
- 7,366
- 5
- 81
masterxfob
Diamond Member
- May 20, 2001
- 7,366
- 5
- 81
BAC, MCD, MO, RIMM
MCD and MO should be safe, but unless you're a gambling man, i'd be wary of BAC and RIMM.
masterxfob
Diamond Member
- May 20, 2001
- 7,366
- 5
- 81
thats insane, i'm more optimistic about BAC and C... what percentage of your portfolio is invested in RMBS? and your overall average?
I'm buying US treasuries. Only place I see myself right now. Equities will take at least another 20% hit, if not more this year.
You really think there will be another 20% drop? I figured we'd just kind of stagnate for quite awhile now.
Yes, the easiest way to rationalize this is this:
Right now the market is priced in that we bailout the banks, they start lending, and things get to be OK.
The reality is: Banks are insolvent, losses across the board will be greater than expected, more jobs will be lost than expected, global economy will contract much more than expected.
Since the market rides on expecations you will see another sell off probably after the stimulus is passed and we get a tiny uptick. Or it might not even matter if something like a Russia default hits the news wire.
Do you really think that the market has priced in a successful bailout? I ask because while I agree that the stimulus/bailout is priced in, I am not so sure that the market expects them to work very well...heck a BAC analyst came out today and said financial stocks are 'toxic,' regardless of govt spending as currently envisioned.
I'm curious also...
You don't have to give us $$$ figures or number of shares, just how many % of your investment portfolio is RMBS stock?
- Jan 23, 2002
- 2,206
- 12
- 81
Well, this thread pretty much gave you guys the average price and now you know the # of shares, so it's not too hard to extrapolate that data once I give you the percentage of RMBS in my portfolio
I don't mind sharing though. It's roughly 23% of my total equity/bond portfolio. The rest are in mutual funds, stock indices, other individual stocks and PIMCO bonds. If you consider my cash position at various banks right now, then the percentage of RMBS vs my liquid assets is a lot less. I'd say it's about 10%.
Yep, I really do. Turbo Tax Timmy made his speech right? It was basically a speech that said nothing, and what happend? The market tanks 300pts. Imagine he comes up in a month again and says "the bailout isn't going as we have envisioned". What do you think the market reaction will be?
The downward pressure on the market is as follows:
- Residential RE market is still tanking
- Every company (at least it feels like it) is reporting lower guidance for 2009 on lower earnings.
- Slumping Spending
- Slumping Retail sales
Items that haven't come into 'fruition' yet.
- Collapse of the commercial real estate market (this will happen this year) simple logic, as stores close etc. what company is going to put their store in? The commercial real estate market is as leveraged as the residential AND it was securitized as well just like the residential.
- Couple of country defaults. Don't be surprised if Russia or some kind of Eastern European country basically goes 'belly-up'. This will trigger a massive sell-off world wide.
Now what are the market positives? (in general) I don't see any. The only item that the market is clinging on to is 'what will Obama and the administration do in terms of bailout'. They have a very limited amount of time to get this done, and to do it right. We are honestly on the brink. If S&P hits 500 and the Dow hits 4000-5000 (or less if things get really bad) cash will be proven king.
Oh and all this inflation talk is bull crap. The next year or 2 we are going to deflate world wide as the massive contraction occurs. People will buy up gold as a flight to safety in the short term but in the longer term it will go down just like any other commodity.
This brings up a question I have always had - how exactly does a country default? They control their supply of money, so why wouldn't they just print more money to pay their debts and avoid defaulting? Obviously it would devalue their currency, but wouldn't that be better than defaulting?
A country defaults when it can no longer service its debt.
Buying treasuries or some other countries bonds (treasuries are bonds) is basically buying someone's debt. When a country can no longer make payments on that debt (when you buy a bond you get a %age and then at maturity you get the balance) it defaults. A default does not mean bankruptcy. Think of it as not making your minimum credit card payment.
The reason you can't just 'print' your way out of the situation is that debasing a currency has HUGE ramifications, 1) being inflation 2) it automatically shafts your creditors (the bond holders) and the net effect doesnt change anything. If you print money, bonds become worth less. Typically you restructure the loans somehow.
RMBS keeps crashing, it's like the bus flew off the cliff.
10% down just today. how many people regret having jumped on the bus??
10% down just today. how many people regret having jumped on the bus??
When good companies are getting hit left and right, you can bet that the more speculative stocks are going to get a heavier beating.
ponyo
Lifer
- Feb 14, 2002
- 19,688
- 2,811
- 126
I had a good dream last night about catching the market reversal and making lots of money.
Banking index sliced through the $25 low it put in couple weeks ago. I think it's now at the 1992 level or something like that. I'm watching S&P 800 and 783 like everyone else. If 783 breaks, 600 is good possibility but I keep thinking that's too easy. But maybe it'll be that easy. Who knows. In anticipation I transferred fairly large chunk of change from my savings to my brokerage. You get couple chances a year to catch a major move and we're going to have one real soon. I want to be ready to pounce if we get there.
Banking index sliced through the $25 low it put in couple weeks ago. I think it's now at the 1992 level or something like that. I'm watching S&P 800 and 783 like everyone else. If 783 breaks, 600 is good possibility but I keep thinking that's too easy. But maybe it'll be that easy. Who knows. In anticipation I transferred fairly large chunk of change from my savings to my brokerage. You get couple chances a year to catch a major move and we're going to have one real soon. I want to be ready to pounce if we get there.
TRENDING THREADS
-
Discussion Zen 5 Speculation (EPYC Turin and Strix Point/Granite Ridge - Ryzen 9000)- Started by DisEnchantment
- Replies: 25K
-
Discussion Intel Meteor, Arrow, Lunar & Panther Lakes + WCL Discussion Threads
- Started by Tigerick
- Replies: 23K
-
Discussion Intel current and future Lakes & Rapids thread- Started by TheF34RChannel
- Replies: 23K
-
-
Facebook
Twitter