THe Dow ends UNDER 8000!

[Mega]

The Penny is dropped!

They sussed that this is not a "Passing thing". Sure the sheep are still too busy watching "American idol"................but its starting to hit home hard now!

I wonder how far it will fall?
5750?
Mike

[friendly_jacek]

Re: THe Dow ends UNDER 8000!

I don't know how low it will go, but looks like the plunge protection team is either:
1. An urban legend
2. On strike
3. Out of money
4. Ordered to resolve since McCain lost the bid.
To be honest, I don't know which.

[Mega]

Re: THe Dow ends UNDER 8000!

Number Three!

Mike

[hayekvindicated]

Re: THe Dow ends UNDER 8000!

There may be a vicious violent rally soon - as is typical of bear markets. The last year we have seen some big rallies.

I work on a trading floor and it always amazes me how a 200 point move in a matter of hours on the DOW has become completely normal these days. In the "old" days, a 100 point move in a day was considered large.

[FRED]

Re: THe Dow ends UNDER 8000!

The Penny is dropped!

They sussed that this is not a "Passing thing". Sure the sheep are still too busy watching "American idol"................but its starting to hit home hard now!

I wonder how far it will fall?
5750?
Mike

Chart above shows iTulip reversion to the inflation-adjusted mean forecasts (yellow lines) March 2006
1. Worst cast
2. Moderate case
3. Best cast


Actual Nov. 2008: Worse than our 2006 worst case forecast


Chart above shows iTulip forecast Dec. 27, 2007 for the US stock market 2008 (Debt Deflation Bear Market)


Same chart updated for the stock market today

[Chris]

Re: THe Dow ends UNDER 8000!

There may be a vicious violent rally soon - as is typical of bear markets. The last year we have seen some big rallies.

I work on a trading floor and it always amazes me how a 200 point move in a matter of hours on the DOW has become completely normal these days. In the "old" days, a 100 point move in a day was considered large.

Funny. I always assumed you worked in the legal profession. Perhaps it will be more lucrative in the future? Regardless, all the best to you, sir.

[Mega]

Re: THe Dow ends UNDER 8000!

I said 5750..........& i didn't need any charts for that!

Mike

[Starving Steve]

Re: THe Dow ends UNDER 8000!

Looking at path #1 for the DOW reverting to its real long-term (CPI-urban) value along the curve of 1.64% inflation, this would seem to suggest about half of the peak value of the DOW at roughly its peak of 14,000, so about 7000. In other words, we are fast approaching the goal of a DOW deflated back to its real long-term worth.

Am I right?

[Serge_Tomiko]

Re: THe Dow ends UNDER 8000!

While I hate spreading rumors, a good friend of mind (from childhood, my best man at my wedding) works at Morgan Stanley and there is talk of a 1-week bank holiday in the cards sooner rather than later. Seeing Fred's Chart makes me thing there may be some truth in this rumor.

[LargoWinch]

Re: THe Dow ends UNDER 8000!

... 1-week bank holiday in the cards sooner rather than later.

for what? the markets are already down 40% and we now have the FDIC.

[sunskyfan]

Re: THe Dow ends UNDER 8000!

I think that the next floor is the Dow before the dot com bubble which would put it at about 6000. The next floor would be when the US went off the gold standard and that would be 1000. I am sure we will all be warming ourselves around fires in trashcans at Dow 1000.

[EasternBelle]

Re: THe Dow ends UNDER 8000!

Looking at the charts I see the Real Dow now at around 75 and hitting the current trend line (1) in about 2.5 yrs at about 45. So that means a Dow (in today's dollars) of 4800 depending on inflation in the next 2.5 yrs it could of course be much higher. I could also significantly undershoot.

I find it so interesting that the totally predictable disinflation reading in CPI (which according to John Williams at ShadowStats was significantly lower because they did away with seasonal adjustments to show for a really nice big decline) send the markets reeling down.

So maybe it wont last and its just another gimmick to get the carmakers bailed out or provide a buying opportunity for a bear market rally for somebody else in the know. Or just for Bernanke to make his statement that he'll fight deflation at all cost.

I wonder whether they are still controlling the genie or whether at some point all this manipulation of sentiment via easily massaged data like CPI, GDP and unemployment will cease to work for them.

Coming from a scientific background it does not cease to surprise me how the markets work (this is definetely not always to my advantage, since I often act on what ought to be according with rational thinking, rather than what actually is)

EasternBelle

[GRG55]

Re: THe Dow ends UNDER 8000!

Number Three!

Mike

In that case someone should call Hank Paulson and tell him to fling some TARP funds over to his buds at the PPT. Quick before we lose another 1000 Dow points...:rolleyes:

[marvenger]

Re: THe Dow ends UNDER 8000!

at least there would finally be some transparency about whats been going on!

[hayekvindicated]

Re: THe Dow ends UNDER 8000!

Funny. I always assumed you worked in the legal profession. Perhaps it will be more lucrative in the future? Regardless, all the best to you, sir.

I am a lawyer and work with commodity traders - so get to see all the action all the time.