About time to go short folks...

ROUBINI is someone worth listening to.    He was ridiculed in the early-to-mid 2000s for his doomsday scenario and gained the nickname "Dr. Doom."   

The first statements from Roubini in the interview are perhaps the most important;

".......  financial crisis that starts from excessive debt and leverage from the household section, leave in a second stage to a second leg where there is a releveraging of the public sector, with large accumulation of public debt, because we need the fiscal stimulus to get out of the recession. Because we decided to socialize with losses that put the losses of the financial system now on the backs of the government. "

Long Story short...   a lot of debt has been transferred from  consumer to Federal balance sheets.     Witness TARP (a product of people buying more house then they can afford), witness the Housing & Economic Recovery Act (again, same as above).

These measure are effectively helping bail out the consumer at the expense of the Fed.. 

So , what does this mean going forward.  Roubini already points out that painful days lie ahead,  in the form of higher taxes.   I already mentioned this earlier in the thread, and is the most obvious outcome of the high federal debt load..

Market gains in the last year was on declining volume.

This is what mosmost have been saying for months..this run was all BS..look at all the stats coming out

25% of those current on the mortgage are underwater in equity

first qtr saw a new batch of folks defaulting on home loans..highest # EVER..

Job #s failing to meet est month after month..they say 5 folks compete for every new job opening??

Consumers still racking up debt,while not paying other bills??

fun times ahead folks

 

 

this is going to be a very long slow grind, and those with the attention spans of flies should up their meds.

The G&D camp is in full-effect right now.... so they are dominating the buyers of late..   Schiller ( the famed economics professor of the "Schilling Index" for housing) was noted as recently saying the average P/E ratio is around 19 for S&P500 companies... compared to historic norms around 15.

Could easily see another leg-down if Europe doesn't get its act together.  Fear and an overpriced market do not make for a good combination...

Hell weve only seen one of the stories from EU at this point...plenty more to come...i dont see how we dont move lower as more fear grips the markets..there will be plenty of news ahead to fan the flames...

don't forget TIME. 99 weeks of federal extensions for UE bennies are running out on those who were the first to lose their jobs. what happens to those poor people?

imo, nothing much has changed from what i saw wrong from 3+ years ago. I don't believe for one second that we see these sub 900 snp and sub 9000 dow, no way. remember, it was monetary policy that ran up the numbers from their prior lows, don't for one second think that the printing presses won't get ramped back up to keep the numbers up. "they" have stated as much. Q/E just ended, and housing tax credit just ended, look what happens to the market without 'stimulus'

the rules of the game are changing at a crazy pace, figure out how 'they' will devalue the dollar next, and you will stay ahead of the game. with so many finally turning bear, i expect to see a nice rally here shortly. this is just a blip, the USD flexing it's muscles, everyone says the dollar is the flight to safety,,,,,,,,yea, i guess. what happens when that is no longer true? won't be anything gradual

DOW levels have been easy calls here lately..if 9500 doesnt hold we see 9000 pretty quick...pulling a chart if 9k goes theres not much in the way to 8000...best to wait and see direction but the levels are there on the charts,Fibonacci doesnt lie

 

The latest developments are a strong signal that the global credit crisis is not over, as some had thought only a few months ago, Roger Altman, founder and chairman of boutique investment bank Evercore Partners (EVR.N), said at the panel.

"The really serious crises of the last 150 years tend to be long and drawn out and have several stages, including a sovereign debt stage," he said.

"The global financial crisis is not over, and it's not close to being over, and there are probably other large shoes that can drop beyond Europe," he continued.

Technicals bad, fundamentals bad, uncertainty rampant, going to be a volatile fall...pun intended  

So where do you think we land by the end of the year?

Not sure about exact timing, if we break 1040 S&P, we're heading to 900.  

You notice they bounced that sucker square off 1040 right?

The VXX is still way low, there is no fear in this market..not sure what to make of that. One could say that the move is orchestrated and we are going back up, or that the drop is hardly starting.

We went to this area in July and then rallied it nearly 10%.

I am not convinced of this being more than a trading range move..

possibly a range wallstreet, we will definitely see volume and volatility pick up in the coming weeks.  there should be conviction one way or the other.  The death cross and possible head and shoulders confirmation would make it highly probable for downside.  But, don't fight the fed right?  IS QE2 right around the corner?

Volume is down in summer months... particularly August, so fear index (VXX) not surprisingly lower.

Let's wait 'til September to see what time of conviction there is in the market.

My expectation is we "break" our range... and head into the lower 9ks in the Dow.   This weeks housing data was just awful, and portends to rough sledding ahead for the overall economy.

We are starting to see what happens to the economy when you take the Federal Reserve training wheels off...   

Consumers and housing are in no position to lead  us out....  We've gone through the inventory-cycle boost.   The Stimulus Boost is fading... We're falling back on whatever underlying strength there is in the private sector.... and it's not looking pretty right now.

So the KC FED manufacturing number drops off a cliff and they are still going to keep the market floating..this should have dropped the market 200 pts.

Quite interesting to say the least..

i am trying to get a business loan and the banks DO NOT WANT MY HOUSE as collateral. they say it is not worth anything? wtf? so i shouldnt even make payments then if it aint worth shit then right? mind as welll just rent one

10:00 am release Ben's speech

Vermeer,

My thoughts exactly..

Ben says "We will buy more agency stuff" market reverses 150 pts.

What exactly did we not know that he said today?

Now the VXX is getting hammered, down almost 5% on a 1.3% up day for the DOW.

Makes me strongly believe that this drop was never legit and back up we go.

Fear was never in the drop, volume wasnt in the drop, but today the move up is on higher volume and seems legit.

Why the move up I have no idea..who didnt know that the FED was going to prop the market?

  Nobody I know expected anything different. Let's face it, he HAS to double down. Or triple down. As has long been known, he believes the printing press the ultimate answer. 

PS

They are crushing it to close..amazing move here and it feels like volume is heavy..

VXX almost down 6% on a 1.5% DOW move..that is speaking volumes.

CNBC wankers think it is news.Of course, if you have the doltish Steve Liesman propped up in Jackson Hole, and an anchor who has no idea where that place might be (and hilariously, asked the question)...well...