Deadman's picture

    Here's the rally ... Now what??

    OK, so I was a day or two early with my short-term bottom and violent rally call, but it's party time on Wall Street today with the markets almost up double digit percentages. (Uh, now more than double digits ...)

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    Deadman's picture

    We need more panic, not less ...

    Damn, I thought I was going out on a limb when I called for a violent (though short-lived) rally to the upside. But if the press and the pundits who speak their mind in the press are any indication, that's a very crowded limb.

    I've been watching CNBC A LOT for the past few days, and it seems like nearly everyone is looking at this crash as a great buying opportunity, telling people not to panic, saying a bottom is at hand and a violent rally is on its way.

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    Deadman's picture

    Short post on short selling and a short-term bottom ...

    I think we're about to get a much-needed reminder that stock markets don't always go down.

    Could happen today, could happen tomorrow, and it may or may not happen after one last big selloff, but we're going to get a relief rally very soon. I don't expect it to last long, but I do expect it to be rather violent and dramatic. Maybe we get back close to 11,000 on the Dow.

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    Deadman's picture

    Perspective on a Gray Monday ...

    So, the market is down 555 points, almost 5 percent. Yet so far this is no October Black Monday, like when the market dropped 13 percent on October 28th, 1929 or when it dropped 22% on October 19, 1987. (Note: Things are moving fast, market down another 100 points since I started writing).

    This is, in many ways, even worse - just another Gray Monday, where we get the continued, orderly drip-drip-drip of a market with no confidence, and no idea of where we are headed.

    Deadman's picture

    You're kidding, right? Right?!?

    So yesterday I wrote about how the Senate was making the bailout plan bigger but not better in order to get reluctant legislators aboard.

    Oh man, you have no idea. It makes me want to cry.

    According to the WSJ, A bill that was originally 3 pages is now more than 400 pages. Among the useless 'sweeteners' tacked onto the plan:

    Deadman's picture

    A better bailout ... or just a bigger, badder one??

    So now the Senate is going to try its hand at passing a bailout plan.

    Deadman's picture

    Holy *%$# ... Bailout defeated, market collapses

    OK, I was wrong. Really wrong. I was sure politicians would approve this bailout bill, no matter how publicly unpopular it was. The short-term risks of not doing something seemed too enormous - a complete freeze of the credit markets and the subsequent collapse of the economic system that relies so heavily on that free flow of credit.

    Deadman's picture

    One $700B bailout coming up ...

    OK, the market's up big. The bailout plan is about to be unveiled. What does it all mean? Here are my thoughts.

     

    Deadman's picture

    Public skeptical of bailout? But of course ...

    We've been told for so long that everything is OK with the economy. Nothing to see here, they've said. McCain calls the economy fundamentally strong; his economic adviser calls the American people a bunch of whiners; Greenspan says we are nearing the bottom of the housing meltdown; Barney Frank dismisses the problems at Fannie Mae and Freddie Mac as overstated.

    Deadman's picture

    All clear? Hardly

    The SEC has banned short-selling on financial stocks. The Treasury has guaranteed money market funds and is cooking up plans to spend hundreds of billions of dollars to buy distressed assets and save troubled banks. The market has rebounded huge, taking back all of this month's losses.

    So are we all clear??

    Hardly.

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    Deadman's picture

    A lot of Boo ... not so much Yah!

    Whoo-boy. Another fun day on Wall Street. I just got done watching another episode of Jim Cramer's Mad Money and I gotta vent a little bit here.

    I like Cramer. A lot of people think he's a buffoon, but I think he's incredibly smart, and he entertains and informs like few others in the business. And there is no denying his stellar record as a hedge fund manager in his former career (though I would venture that a lot of the practices he now rails against as a voice for the common man- like naked short selling - helped contribute to a lot of that performance).

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    Deadman's picture

    Teach your children well ...

    Many people want to know how this country got into its current economic mess. The news this weekend that some of Wall Street's biggest, most prestigious financial institutions (Merrill Lynch, Lehman Brothers, AIG) are failing and need to be rescued will raise many more questions.

    Of course, the full story is quite complicated, but one of the main drivers behind the current problems is the housing crisis, and the fact that these institutions allowed many homeowners to take on way more debt than they could handle.

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    Deadman's picture

    Merrill saw the light ... Now maybe we can too

    I just wanted to offer my immediate, quick, bullet-point take on the flurry of GIGANTIC market-related news today, which i

    briefly referenced last night.

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    Deadman's picture

    'Yes, everything you see on this show is for sale'

    Originally published on Aug. 2, 2008

    Truman Burbank is agitated. The main character from the movie The Truman Show is increasingly suspicious that something's terribly amiss in his made-for-TV world, and his 'wife' tries to calm him down with a cup of 'mococa.'

    "All natural," she tells him, holding the package of cocoa up to one of the millions of hidden cameras filming Truman's life without his knowledge. "Cocoa beans from the upper slopes of Mount Nicaragua ... I've tasted other cocoas. This is the best."

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    Deadman's picture

    Pessimism doesn't pay ...

    My dad is an eternal optimist, one of those turn-lemons-into-lemonade people. And yeah, it sometimes annoys the living shit out of me.

    I am, after all, an in-the-long-run-we're-all-dead type of guy, a devout half-empty man (I'd call myself an eternal pessimist, but I don't believe anything lasts forever :) )

    Deadman's picture

    Bubbling black - revisited ...

    Time for a short self-congratulatory post (For if I don't do it, who will?).

    Right before the Fourth of July, I wrote that the price of oil was a bubble waiting to be pricked and nearing a short-term top. In the past three weeks, the price of oil has fallen by about $20 bucks a barrel, or almost 15 percent, a huge move by any standard. In terms of daily closing prices, July 3rd ended up being the exact top.

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    Deadman's picture

    You can't force compassionate capitalism (or 'My BuschInBev is fine. How's your pikken?') ...

    As a native St. Louisan who always feels some sort of odd civic pride whenever those clever beer commercials end with a dude intoning 'Anheuser-Busch, St. Louis, Missouri,' I know I'm supposed to be upset about the recent acquisition by Belgium-based InBev. Yet I can't muster any passion over the loss of the historic brewer and one of my hometown's few remaining independent corporate behemoths (TWA, McDonnell Douglass, Ralston Purina all bit the dust long ago).

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    Deadman's picture

    Bubbling Black ... Pop Goes the Diesel ...

    OK, I know nothing about the oil market, but considering I distinctly remembering the then-CEO of Exxon-Mobil saying on CNBC that oil was way overpriced based on the fundamentals some 2-plus years and $100/barrel ago, I don't see why my lack of knowledge on the subject should keep me from commenting.

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