Please tell me why our stock market is down 20% since July?
Don't ask us, we're just dumb brokers. Call your friend Mr. Rainwater.
...word got out that you sold your book...
"It's the economy stupid!"
-Bill Clinton 1992
If you're a CEO, this market is great for taking-out the trash. Got some losses you've been hiding thru clever accounting? Got a division that's expected to lose money for the next couple of years? Awww heck, wanna just take some nonexistent losses now, so your earnings will look better later on? Now's the time to do it. Everyone is so fixated on the market being down, no one is going to notice your writedowns. Then once you've cleared the books of bad decisions and poor investments, your earnings will shine!
It's just part of the cycle. Every several years (3-6), we go through this. It is not to ask why, it just is. If you are invested appropriately and in quality stuff, you really don't need to worry (too much). Now, this may be overblown, or it may just be the tip of the iceburg (say it's like the Y2000). Fortunately, most stocks are not ridiculously priced right now. However, the consumer economy may also be on the verge of derailment. You just don't know. But history has taught us to hang tight with quality investments.
Your first 4 sentences is what I have been telling most of my clients. I feel we are still at the tip of the iceberg on the financial breakdown, hearing news of global epedemic and billions in commercial forclosures coming up. Its not just an opportunities for all the banks/institutions to take write downs, they have to or they will go insolvent. THAT IS BAD.
I just hope history will not teach us something new in the next few years.
Dow up 50 points...why? If we are going into the abyss, why is anyone buying stocks?!!!
What is wrong with you people?!!!
(going into my bunker for awhile...thank goodness there is an internet connection...)
3 days down..one day up..try doing that for a year...
Bush is going to make his stimulous package speach.. It will be a high volatile day.
These vitamin B12 shots will keep the economy alive until he is done with his term...
short term...very short term boost.
joedabrkr wrote: More sellers than buyers. I figured a genius like you would know that.
That is the best answer. NOW, why are there more sellers?
I didn't like his speech. we went from triple digit positie to negative..after a down 307 day....I guess investors didnt like his speech. Boosting the ecomony by printing more debt. Questionable. what to do..what to do.
Mc Leavin... We're not running out oil TOMORROW or the next day or the day after that. We're not running out of oil for years. These catastrophic events may be in the works and we have to do things to avert them today and tomorrow, but this is not the reason why the market is going down. The reason, today, that oil prices are high are a mixture of higher than historical demand from large, developing countries with a weaker than historical $. This hits us especially hard because we obviously earn & spend only in $. The housing market & liquidity crisis can and will be solved with time. The chicken is chasing the egg around to figure out what will stand firm to bring us out of the mess, but even today refi's are picking up on ARM's. This will mitigate the risks of adjustments that are out of control. If you recall this was the beginning of the end of the mess we experienced in 2001/2002. I can't believe with 30 yrs experience underneath your belt that you are so alarmist. Frankly, I'm not buying it...
We aren't running out of oil tommorow! We will never run out of oil. There will still be a few drops left long after we are gone. But that is not what is important. It is just a matter of demand outstripping supply. Energy (cost) invested exceeding energy returned. We are at that peak oil situation. IMHO, this energy crisis only shortened the timespan till the unavoidable financial collapse. There are alot of experts and veterans that are alarmist, I don't like what they say, but I will listen. I owe it to myself and my clients.
This story is not designed to draw parallels with McLovin, but I had a boss back in 1995 who was very bearish and spoke some of the same sentiment that McLovin does. He was putting large percentages of client money in gold and short funds and it ultimately cost him his job. He was fired and I replaced him. He then went from senior trust officer in our bank to a registered rep in another. He began sending lengthy letters to the editor about the looming crisis (I always wondered if they were compliance-approved...). Not long after that, he washed out at that bank also and shortly thereafter, declared bankrupcy.
Ultimately, he was right about the downturn, albeit five years early and I'm sure he got a lot of satisfaction out of that while eating Ramen soup in his cramped apartment. I learned a lot from watching his saga and lesson number one was to not bet the farm on a single scenario. I've stayed with that all-weather approach and it's served me well...helped me survive a very difficult time in 2000-2002 and kept clients in the market when they were less than thrilled with it. It's also meant that my clients don't always get the raciest returns, but they came through the last downturn relatively healthy.
I've poked a bit of fun at McLovin and I don't agree with his outlook, although I do pose this question...IF he's even partially right, do you have a part of your client's portfolio walled off from the market for them to live off when times are tough?
ASSland,You are right, we are not running out oil tommorow, or the day after that.
Broker7, you are correct abbout the oil. I also found the speech to be vague and incomplete.
Another broker is selling off ALL of his 9 figure book next week. How do I know? He called me today for advice on finalizing it. It is my time in business that allows me to see this situation as being far beyond the other crisis I have seen. As an analogy, it is like comparing the moon to the sun.
You don't have to buy it. I just want you to see it as a possibility. However remote.
MCps: I do apoligize for addressing you as ASSland, as you can see from my posts, that is not my style nor demeanor. Reciprocal.
Indyone, I thank you for saying this story is not designed to draw parallels to me. But in many ways, it does. If I am all together wrong, so be it, I have health and wealth.
Some difference, outside of time and history, my business is successful, and it is my business to sell, keep, prosper or destroy. I hope the broker that bought the bulk of my book does them right.. I too, have been seeing problems coming since the mid 90's. The dot com bust was more than I had guessed, some of it due to an unexpected 9-11.
From that moment on, I have seen huge cracks in the foundation getting larger and larger, cracks we cannot patch and mortar. Again, that is just opinion. But it is the opinion of many people, it is very prevailent in high net worth people. Not that they are any better as people, but none that I know are SHEEP. They don't like main stream media and they see (or like to think they see) the big picture.
Thank you for asking "IF he's even partially right, do you have a part of your client's portfolio walled off from the market for them to live off when times are tough?" Please ask that question with colleagues and clients in person.
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