OFFICIAL STOCK MARKET & ECONOMY THREAD VOL. SCHOOL'S OUT

[theone2401]

Originally Posted by thekryptonite

Originally Posted by theone2401

Originally Posted by thekryptonite

Originally Posted by theone2401

Originally Posted by thekryptonite

i'm guessing no one here knows about the London FTSE?

what about it? UK is in worse shape then the US.

yeah we are in bad shape, i was just wondering if anyone has knowledge on it. at the moment i have my money in RBS which I believe to be a good investment for the future.

Oh you mean from a specific stock perspective well I really dont follow it and I definetly dont follow RBS but I know its a bank and they are not, IMO, good investments no matter what happens unless we go back to fantasy land.

how come? i heard financials were good for a long term investment.

I am going to go with the fact that they have been making money by siphoning capital from the real economy through debt and excessive risk takingand this is reversing. Seriously, their business model because of new regulation, increased price of risk, and the eventual lack of affordable credit is goingto eat those profit margins. I dont see how anyone can look at a bank as anything other then a call option on a return to the bubble economy.

Again I dont know about the UK specifically but in the US they are lending out mortgages at 4-5% because the rates are being subsidized and borrowing at 0 to1%. But at the same time they are printing money like bandits so their borrowing costs will rise. Not a good look. And of course the death of securitizationand the inability for them to do things without anyone looking...etc.etc..

 

[shch]

Naufal made all the right moves, it was just his timing that was off and cost him all that money.

 

[dey know yayo]

UK is significantly worse off than USA. no doubt about it.

 

[xilegacy]

I'll come back to this.

 

[neil likes poker]

DKY I feel you on the market correcting itself and think Tuesday or Wednesday we will see a drop. This rally has just been supported by people believing thebanks will be able to pull a profit but in reality they have to deal with credit card defaults. Obama is also going to hurt the banks when he has that creditcard bill passed so its only a matter of time before this market corrects itself. No real positive news has come out to date.

 

[da703trailblaza]

DKY, if you dont mind me asking. How much did you start out with.

the real

thing is Tim Geithner thinks the economy can recover off increased earnings in banks.

And just ride out your financial shorts, the squeezes suck, I was short GS, LEH during the spring, the fall was very good to me

Though financials may be the easy target, I have to say tech stocks are at bubble valuations, I started shorting AMZN last year at the same price level it isnow. But I hate trading Nasdaq stocks.

 

[blazersin2k3]

what do yall think of FAZ, im in at 13

. is this rally over or should ijust sell and take the L. i know these are stupid to hold overnight but i did get FAS at 8 and that went to 2 and i ended up selling at 9, so i can ride thsiout but right now faz is killin me. what else should i get into. i was in dndn a few weeks ago and got a nice 40% return on the 5k i put, i see some otherpharmacuticals doing well but i'm not too knowledgable about those.

 

[kicksfiend]

Originally Posted by Dey Know Yayo

yes. it is my submission of the bigass post i posted on page 3 with the hustlin video.

You mean the summary of a bunch of different blogs you've been reading? Zerohedge should be credited as a co-author.

http://zerohedge.blogspot.com/

Check them out. Real good stuff.

 

[dey know yayo]

"Tyler" from Zerohedge and I share regular correspondence. Most of my article is original analysis of bank earnings reports and releases, but yes itwas definitely meant to be a compilation of the myriad brilliant analyses on the topic in the last 2-3 months.

 

[Sam Darnold Heisman #8]

shorted liz claibourne a couple days ago after talking with my friend that works there and knowing earnings were coming out today

 

[neil likes poker]

I love the crash on banks happening today. I think many of the investment banks were sparking the rally and they sold at the peak. They are going to keepmessing with financials as we will not be out of this recession for a while. We need to have growth in jobs not a decline in the number of jobs being lost.When more jobs are created we will see everything ease back to normal.

 

[patmc13]

welcome back...

 

[dey know yayo]

Originally Posted by Matt Barkley Heisman Number 8

shorted liz claibourne a couple days ago after talking with my friend that works there and knowing earnings were coming out today

 

[be4chst]

Bought NTES, it's a winner.
Won a contract from World of Warcraft and they are the only provider for the next three years in China.

 

[dey know yayo]

NTES going right back down with the rest of the techs in this market, low 20s im thinking. NTES is an old tech bubble winner, not a great play anymore.

 

[dey know yayo]

Across the indices and big names, it appears that a reversal of gains from May 4 (the day the rally went parabolic) onward would confirm a reversal of themassive rally. I also see a lot of broken bulls flags across the market in various names, and broken bullish setups often lead to bearish reversals.

The Proshares Financials ETF (XLF) tracks financial stocks and has pulled back to its May 4 breakout point around $11.30. Previous resistancebecomes new support as rallies continue so its action around these levels is very important. I expect a bounce but if it doesn't bounce hard from here andcontinue on to break the $13 level and the 200DMA, this pullback should be turning into a confirmed reversal soon. A breakdown at $11.30 would be a great shorttrigger in my opinion.
























The Powershares QQQ ETF (QQQQ) that tracks the Nasdaq 100 found a lot of supply near its 200DMA and broke right below it. It behaved verysimilarly around its 200DMA last August right before the crash, and though I don't think a repeat of Sept-Oct 2008 is in order, I do think techs will sellheavily from these levels.
























The Financial Bear 3x ETF (FAZ) is at its resistance trendline and a small pullback from here could lead to an explosion through it, beginningits upward ascent I have been waiting for.
























Be watching for how the market, particularly financial stocks, react around their May 4 breakout points. A breakdown at those levels should lead to a big movedown over the next 6-8 weeks. One group that has already started breaking down hard is the REITs.

-----------------

CSPAN video of today's Senatehearing: "Congress Questions AIG's Progress & Accountability"

Great analysis from Denninger:

Ok, now this gets interesting.

In a hearing not covered by the so-called "mainstream media" but covered on Cspan, Liddy, AIG's CEO, in response to a question by Rep Kaptur said:

"When The Fed set up Maiden Lane they took on responsibility for settlement of all of the CDS."

WHOAH!

Ok, now we're getting into interesting territory.

Specifically, I quote: "The Federal Reserve decided we should pay 100 cents on the dollar", but Mr. Issa nailed the truth on this in a followup - they could have purchased those contracts for far less in the open market at the time.

The bottom line is that the testimony was that The Fed decided to settle the contracts in a non-economic manner that resulted in screwing the taxpayer by transferring more than $100 billion dollars of taxpayer money out to these banks when the cash value at the time was FAR LESS.

(Mr. Issa, by the way, is one of the Congressfolk who actually does understand securities - and it shows. He refused to let this go until he hammered it into the ground and got the answer in plain, irrefutable English.)

Bluntly - we got raped.

Is it any surprise that CNBC is refusing to cover this?

Is it any wonder how the banks managed to "report decent profits"?

The allegation just made by Liddy is that Bernanke and The Fed literally stole $100 billion dollars from you and I by intentionally and wantonly overpaying on the settlement of these contracts!

I want to see indictments; nothing less is sufficient any more.

The "government rally" is over. Banks were capitalized during Q1 through AIG/Fed shenanigans. They sold their equity and now it's time for thereversal to begin. A reader messaged me about a Reuters article that suggeststhat the FDIC "was considering seeking to create a new fund to help deal with any resolution of systemically important financialinstitutions," which could mean the FDIC is bracing for another large bank failure in coming weeks and months. Things have not turnedaround. When they do turn around in nominal terms, gold will be above $1000/oz and surging.

Reflating bubbles does nothing except cause nominal recoveries at the expense of taxpayers.

Update: some interesting analysis from Zero Hedge aboutthe massive slowdown in AIG's CDS unwinds.

AIG CEO Ed Liddy provided some more fire for this hypothesis today during his testimony before the House Financial Services Subcommittee. In a very odd twist, Liddy, who in March had disclosed that AIG-FP had unwound over $1.1 trillion in CDS notional (from $2.7 trillion to $1.6 trillion - a ridiculously large amount), today noted that the financial black hole had succeeded in only unwinding an additional $0.1 trillion in the last 2 months, from $1.6 trillion to $1.5 trillion.

I provide the full transcripts from March and May for compare and contrast purposes.


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Airliners look bearish




















































































































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Some good reading:

• Banks' inane leverage in the political arena -Bearish News
• Investors confidence turns bullish, contrarian indicator? -Bloomberg
• FOIA request uncovers shocking bank bailout documents -Judicial Watch
• Analyzing the FOIA disclosures -Zero Hedge
• Geithner blames Fed's easy credit policies for asset bubbles -Option ARMageddon
• Japan opposition party leadership wants out of dollar-denominated US bonds -BBC

 

[dey know yayo]

I post trades I make in my personal account here at the end of each trading day. Feel free topiggyback my trades.

 

[rickyfong]

AHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH LETS JUST ALL FLOOD OUR MONEY INTO LEH

 

[dey know yayo]

Goldman Pays Greenmail to Make Snoops Go Away

May 14 (Bloomberg) -- Thanks to the commonwealth of Massachusetts, crusading attorneys general throughout the land now have a road map for extractingmultimillion-dollar checks from Wall Street banks such as Goldman Sachs Group Inc.: Don't accuse them of anything at all.

The big news from Goldman and Massachusetts Attorney General Martha Coakley this week was a $60 million settlement, under which the investment bank resolvedher office's investigation into its packaging of mortgage securities backed by subprime home loans. Per the usual custom in such accords, Goldmandidn't admit any wrongdoing.

The odd part is that Coakley's office didn't accuse Goldman of any wrongdoing, either. It filed no lawsuit. And it made no allegations that Goldman hadviolated any statutes or rules.

Why did Goldman pay if Coakley's investigators couldn't identify any infractions to allege? That's a mystery. The only statement I could squeezeout of Goldman was a one-liner from a P.R. man, Michael DuVally. "Goldman Sachs is pleased to have resolved this matter," he said. I'll bet itis.

The closest thing to an accusation Coakley could muster during a May 11 press conference was that Goldman "had played a role" in predatory lending inthe state. Then again, so did a lot of other companies. By that standard, even local newspapers that printed the lenders' ads might be in trouble.

Goldman paid anyway, the same way a company might pay greenmail to a corporate raider who demands a premium price for his shares in exchange for going away. Ifgetting Goldman to fork over a $60 million settlement is this easy, it seems every state attorney general in the country should try it.

Making Amends

According to Coakley, who has been investigating abusive lending in the mortgage industry since 2007, Goldman offered to make amends before her office hadcompleted its probe or concluded whether the bank might have any liability.

"They agreed it was in their best interests to mitigate whatever damage had been done," she told me in an interview. "They're the ones whoasked 'What would satisfy you?' We laid out what we were looking for in terms of damages."

The outcome will draw no complaints from the 714 lucky Massachusetts borrowers who took out subprime loans Goldman now holds. Under the pact, Goldman willprovide about $50 million of relief for residents in the state, including principal reductions of as much as 35 percent for first-lien mortgages.

Coakley said many of the mortgages -- which were originated by other lenders, not Goldman -- "were unfair" and "designed to fail at theinception." Goldman also is paying $10 million to the state, almost all of which is earmarked for its general fund, although this wasn't labeled as afine.

Investors' Stake

The borrowers aren't the only ones who had a stake in the investigation's outcome. So did investors who bought subprime mortgage securities fromGoldman.

According to the settlement agreement, the probe's scope included whether Goldman's disclosures to investors in such securities were adequate. Thestate also was investigating whether Goldman failed "to take sufficient steps to avoid placing problem loans in securitization pools" or "tocorrect inaccurate information in securitization trustee reports." Coakley's office left those questions unanswered.

When I first read through the settlement agreement, which contained no findings of fact, I couldn't help but wonder if this might be one of those instanceswhere a prospective plaintiff agrees to take a payoff in exchange for keeping silent about any damaging information it knows.

You Have to Wonder

Coakley said it was a fair question. She assured me, though, that this wasn't the case. "There was no smoking gun here," Coakley said. She saidGoldman's $60 million offer was everything her office could have hoped for, especially given its limited budget and jurisdiction over the bank'sactivities. Even if the state had filed claims against Goldman, "we would not be able to achieve a better result," Coakley said.

That may be true. It's also conceivable that Goldman had no legal liability, and decided to pay the equivalent of a parking ticket just so it could get theinvestigation over with and stop racking up bills for outside lawyers.

Yet there's the inescapable feeling that we have no idea what really happened here. Those 714 borrowers may be getting compensation. What much of thepublic is looking for, though, are answers about how some of the nation's most powerful Wall Street banks helped drive us into our present economic mess.

We didn't get any this time. Perhaps that's one reason Goldman is so pleased with this investigation's resolution.

(Jonathan Weil is a Bloomberg News columnist. The opinions expressed are his own.)

To contact the writer of this column: Jonathan Weil in New York at [email protected]

 

[dey know yayo]

Indices are sitting on their support trendlines right now and either a breakdown at S&P 875 is coming soon or one last move up to S&P 950ish around the200DMA.

Articles like this sure point to a possibility for one more move up, as well as the short selling "restrictions" and "hard-to-borrow" statuspervasive among financial stocks these days.

The charts will indicate whether the reversal is here or if one more up move is left but I am staying bearish until further notice at this point. I did howeveradd some hedged and long exposure today to play the possibility of upside.

 

[dey know yayo]

• GM likely to pursue "Gobama" socialist Chrysler-like deal in the (imminent) event of bankruptcy -Reuters
• Barclays attempting to sell quant BGI (more quant troubles) -Bloomberg
• Robert Prechter (who went long/bullish near 666 lows) suggests bearish deflationary collapse still the environment pervasive in equities/no new bull market yet -Reuters
• For more insurers get TARP money (that is, until credit rating cuts disqualify access to CPFF) -Reuters

 

[dey know yayo]

Indices are sitting on their support trendlines right now and either a breakdown at S&P 875 is coming soon or one last move up to S&P 950ish around the200DMA.

Articles like this sure point to a possibility for one more move up, as well as the short selling "restrictions" and "hard-to-borrow" statuspervasive among financial stocks these days.

The charts will indicate whether the reversal is here or if one more up move is left but I am staying bearish until further notice at this point. I did howeveradd some hedged and long exposure today to play the possibility of upside.

 

[kickmatic23]

So much to learn.. so much..

 

[throwedindagame]

For those of you who are good at Fundamental Analysis, what would be the best 3-5 financial ratios for comparing companies in the Health-care Sector?

Thanks in advance. I'm doing some Google research but everyone's opinion is welcome. The more, the better.

 

[wstcoastgotti]

Bought 100 shares of FAZ today... Holla!