How Low Can It Go?

[FRPLG]

Originally Posted by Schneed10

He shouldn't care. If people want to be irrational (ie retarded) and get all panicky and sell, that's their problem. Eventually someone else will come along and buy up those devalued shares, and they will be the ones to reap the rewards when the market goes back up. From a macro level, it's all good for the United States. Some will get panicky and lose by selling now, and others will pick up those shares and gain.

It's up to the people to decide for themselves to be smart or stupid with their money. If they're looking to the President of the United States to determine what the market is going to do, then they're categorically being stupid.

I see your point an d fundamentally agree but here's the rub. While his policies kill the market real devaluation is taking place. People who don't have 10 years to wait for it come back are getting screwed in the ear. It is not going to bounce straight back up. It will probably be a slow and steady rise.

[Slingin Sammy 33]

Originally Posted by Schneed10

As soon as we begin to blame the President of the United States for what is happening to the stock market, you can pretty much call the market's behavior irrational. The president of the United States has very little control over the economy, big stimulus bills or otherwise.

The fact that people are blaming Obama shows that too many have no idea what's driving the downturn, which means prices have been driven down too far.

When lending turns around this market will bounce very high. Don't worry about whether you're getting in on the ground floor, just get in before you miss it.

The POTUS has very little control by himself. A Democratic POTUS with a Democratic Congress has a great deal of control. In this particular situation where the housing market has tanked due to bad loan policies, it will take some gov't intervention to fix the situation and remove the bad loans from the system. Hopefully this will restore banks confidence in each other and people's confidence in the banks. Credit should begin to flow and people will spend again.

However in the face of this economic crisis a tax increase targeted at those who drive the economy, a capital gains increase, restoration of a 45% death tax and energy/pollution taxes (which will be paid by every American who has electric service or puts gas in his/her car), coupled with huge spending increases has a great deal to do with the current drop in the markets. Will they rebound, at some point of course. We came out of the depression and the 70s, but as FRPLG mentioned, we will most likely wind up with another lost decade if Obama's administration doesn't do an about face on their current policies/positions.

For the record I'm betting on a floor of 4800.

[Schneed10]

Originally Posted by Slingin Sammy 33

The POTUS has very little control by himself. A Democratic POTUS with a Democratic Congress has a great deal of control. In this particular situation where the housing market has tanked due to bad loan policies, it will take some gov't intervention to fix the situation and remove the bad loans from the system. Hopefully this will restore banks confidence in each other and people's confidence in the banks. Credit should begin to flow and people will spend again.

However in the face of this economic crisis a tax increase targeted at those who drive the economy, a capital gains increase, restoration of a 45% death tax and energy/pollution taxes (which will be paid by every American who has electric service or puts gas in his/her car), coupled with huge spending increases has a great deal to do with the current drop in the markets. Will they rebound, at some point of course. We came out of the depression and the 70s, but as FRPLG mentioned, we will most likely wind up with another lost decade if Obama's administration doesn't do an about face on their current policies/positions.

For the record I'm betting on a floor of 4800.

I wholeheartedly agree with the economic theories you're discussing here (and I've sung them from the mountaintops myself within these forums).

But I think a good deal of the expectations of poorer earnings were priced in around the time Obama was elected, and certainly were priced in by the time details of his stimulus bill were made available. I think the fundamentals support a bottom no lower than Dow 6000. Any decline below that point will be as irrational as the exuberance noted as same by Alan Greenspan in the late 90s.

[Slingin Sammy 33]

Originally Posted by Schneed10

I wholeheartedly agree with the economic theories you're discussing here (and I've sung them from the mountaintops myself within these forums).

But I think a good deal of the expectations of poorer earnings were priced in around the time Obama was elected, and certainly were priced in by the time details of his stimulus bill were made available. I think the fundamentals support a bottom no lower than Dow 6000. Any decline below that point will be as irrational as the exuberance noted as same by Alan Greenspan in the late 90s.

Agree. I've just got a little less faith than you do in folks being rational.

[KLHJ2]

I sold last September and I claimed my losses on my taxes. I am looking to buy back in within the next couple of months. By my estimation despite my losses I am about to make some considerable gains in the future. Is that wrong...Schneed?

[Schneed10]

Originally Posted by Angry

I sold last September and I claimed my losses on my taxes. I am looking to buy back in within the next couple of months. By my estimation despite my losses I am about to make some considerable gains in the future. Is that wrong...Schneed?

That's what I'm doing. I'd caution that you shouldn't go heavy on stocks if you need the money within the next 10 years. Otherwise, it's a great time to go for it.

[firstdown]

Originally Posted by Angry

I sold last September and I claimed my losses on my taxes. I am looking to buy back in within the next couple of months. By my estimation despite my losses I am about to make some considerable gains in the future. Is that wrong...Schneed?

Angry, I'm no tax guy but if you right off your losses one year I think it has tax issues when you buy back in . I could be totaly wrong but I believe there are tax rules that prevent people from selling at a loss, writing them off then turning around and buying back in at lower prices. You might want to check that out.

[firstdown]

I love these threads. It always seem that we all want the same thing but we have completly different views on how to get there.

[SmootSmack]

5,800

[Monkeydad]

For reference:



Our Troubled Economy Is a Response to Barack Obama's Policies - WSJ.com

[Slingin Sammy 33]

Here's some more food for thought:

Obama’s Top Five Broken Promises « FOX Forum « FOXNews.com

Some Quick Charts on the 2010 Budget | Americans for Prosperity

[Miller101]

Originally Posted by Buster

For reference:



Our Troubled Economy Is a Response to Barack Obama's Policies - WSJ.com

Are you really being serious? Obama has been in office for ONE MONTH!!! Not even Bush was able to crash an economy after ONE MONTH!!!

How low can it go.............I'm gonna say 4000. This will be known as The Great Recession when its all said and done. Thank you Mr. Bush. Thank you for screwing this all up! And THEN leaving your screw up for someone else to fix. You are to kind!

[CRedskinsRule]

Originally Posted by Miller101

Are you really being serious? Obama has been in office for ONE MONTH!!! Not even Bush was able to crash an economy after ONE MONTH!!!

How low can it go.............I'm gonna say 4000. This will be known as The Great Recession when its all said and done. Thank you Mr. Bush. Thank you for screwing this all up! And THEN leaving your screw up for someone else to fix. You are to kind!

why are you thanking Pres. Bush. Can we all please acknowledge it took both parties (the democrats in the congress and the republicans in the white house) to get us in this position. and also that a big part of this is a natural economic cycle? please?

[Monkeydad]

Originally Posted by CRedskinsRule

why are you thanking Pres. Bush. Can we all please acknowledge it took both parties (the democrats in the congress and the republicans in the white house) to get us in this position. and also that a big part of this is a natural economic cycle? please?

Can we please acknowledge that the economy was going great until the Democrats took over Congress?

You should. It's a fact.

[CRedskinsRule]

Originally Posted by Buster

Can we please acknowledge that the economy was going great until the Democrats took over Congress?

You should. It's a fact.

No actually I won't. For 3 reasons:
1) Pres. Bush was still President, and could have and should have stood up to the Congress like Reagan did to the Speaker of the House (ONeal I think but I know they hated each other)
2) When it was a Rep. Congress and Rep Pres, they were still spending like drunken sailors who just got back from a 6 month tour of duty.
3) Like most "FACTS" presented as you have there is usually a whole lot of spin based off of some level of truth/fact.