The bill is signed and now we are on the hook for $700 billion... I was expecting a pop in the market... no pop... just a bust... which means the market has had enough time this week to recognize the Bailout is impotent to turn the market and in the deflationary mood of the economy I expect the DJIA to continue in a downward trend. October will end much much lower probably around 9300. There will be 'pops' up during the downtrend. It may turn up slightly from there to end the year but 2009 will prove even more bearish...
With a sick and possibly dieing credit market:
1. Businesses will not be able to use credit to stock for seasonal buying periods.
2. Those businesses who use credit to cover payroll till they get AR will not be able to cover payroll.
3. People will not be able to get loans for cars or houses... nor will they want to..
4. As the economy continues to contract spending spirals downward.
5. For business survival prices from wholesale to retail will begin to drop just to attract money to the business for cash flow.
6. When dollars don't move out of hands businesses will begin to close at a record pace... along with rising unemployment...
7. Fear will sweep the land... And anger... the blame will go to government... expectations will be for government to fix it... but it can't... government only grows larger and larger till it collapses the entire country. (see USSR)
8. Remember the government gets it's money from producers... as producers dramatically drop off government revenue drops and individual states begin to go bankrupt... looking to the Federal government to 'Bail them out' with tax dollars that are not coming in... the Federal government must do drastic drastic things like halting large entitlement programs.
HOW DID WE GET HERE!!!??
The smaller the government the better the Market works.... over the last 65 years government has grown and grown... in size, in reach, in regulation, in promises, in entitlements, in taxation... the largest corporation in the country, the Federal government has become the FAT CAT business that everyone should be hating...
ROME died due to entitlements... which now make up 55% of the US budget...
We are due for an economic depression... over due... it is normal... not fun... doesn't feel secure... prosperity will go... BUT HOPE SHOULD NOT... If your Dad owns the Universe... He will walk us through.
Folks don't like this kinda talk because they have to recognize that the future we were expecting may be gone and a new less desirable one may be coming... the grieving process kicks it...
Be prepared... I suspect most have done very little to get ready hoping for a turn around... ( i haven't done as much as I should have to this point... but that will change)
I find it fascinating that two thirds of the states who do not have a state income tax are not considered to be in recession... but every other state is in recession.... the more the government takes from your pocket the more damage is done.
I am not sure if I should revise my prediction of the Dow @9300 by the end of the month or not... may be much lower...
It's like a perfect storm... who knows... the multiple warnings that we as a nation have had over the last 9 years we've not responded....
It's like warning your child... then threatening a spanking... then counting to three... When they continue in rebellion then you must apply the harshest punishment... for their good... you know, break their rebellious spirit so they begin responding to your voice with quick and complete obedience.
14066.01... that was the top... the all time top... now we are at 9447.11.... the Dow has dropped over 30% since the top....
What does that mean? well if you had $100,000 dollars invested in in the Dow Jones Industrials then you have lost $33,000 dollars....
Nothing has helped... every bullet the Fed has fired has been a dud... they have several bullets... but each bullet consecutively takes more out of your pocket and more out of the Free Market and More FREEDOM... just suppose that Robert Pretcher author of Conquer the Crash is correct and the Dow ends up at 400.... not a good number... (I don't think we end up there but I think we end up really low...) What is the Positive here? COME ON man you are such a freakin' downer!!!!
Well.... I hope the positive is the fact we are ahead of the curve and we have cash and we have moved our 401k's to market funds and we have paid off debt or are close to paying off debt and we have stopped spending on things we don't need and we have stored some cash in the mattress and we have some extra food stored up and at the bottom.. which may be in 2010 or 2011 or 2012 we will have enough saved to buy up stocks.. real estate ... and other types of assets and ride the wave UP to major wealth.... not for us but for the kingdom... that is if it is still legal to be wealthy.
So far ... it's been way way too on course of everything predicted... that is not good... predictions never are exact... but these are so far spot on... that is not so good... the reality needs to be north of the predictions... not at ..or worse ... below.... be prepared... please... your friends or family may need some money or food sometime in the future... be ready to be open handed.
I am not going to revise my prediction that the Dow ends the month at 9300... even though the Dow is currently BELOW that number... I am expecting the Dow to recover slightly before the end of the month and end right around 9250-9300... But I must say that the economists that I subscribe to.... are predicting 8700-8750.... with a new low in 2009 of 7700...
In all recessions and depressions of known economic histories the predominate 'stock market' crashes before the economic winter really begins... I don't know about you but I feel a real draft...
Friends, Romans, and Country Men... Lend me your ears...
I am not quite sure what to say... Surely this is a bottom.. at least for the year... Surely we will have a slight recovery before the end of the year...
The Fed is firing its gun a fast as they can get it loaded... One talking head said the latest moves are like empting your gun and then in desparation, throwing the gun...
Even though we have been saying that this was coming... you know.. a real economic winter... or collapse... it is weird to see it happening in real time...
The rest of the world is firing all their guns as well and the Bear just won't die.
Worse, there now is a concerted push to 'get together' globally to combat the dive... which sets up the perfect conditions for a 'World Government'. Yeah that is kinda scarey ain't it?
So there will come a time in the very near future that preparation will be to late... (i just hope it hasn't past)
Now as for FEAR... don't bow to it's roar... There is a hope that out weighs fear... That hope comes from knowing the One who dismissed fear and death 2000 years ago.. and for those who have believed He gave the right to become the children of the Maker of the universe... Live in the New Kingdom and not in the world... the kingdom is where the fiat currency is the good things he has set aside for us to do in concert with Him... Store up teasures in heaven...
Well is this the bottom? well according to the Elliott Wave Theory... It is not the near term bottom... (I want it to be the near term bottom)... but the theory predicts 7200 is the near term bottom... with brief and anemic rebounds or sideways seesaw movement before going much much lower...
The Crash of 1987 the Dow lost 30%... The Crash of 1929 lost 40% in less than two months... and ultimately lost 89% by 1932 when the Depression was two years in...
Where are we now? The Dow currently is down 40% from the high... there are no REAL conditions that will turn the market... There are multiple attempts to generate the IDEA of a new condition... this is to try to change sentiment... because the Market is a picture of sentiment... BULL markets are caused by good fundamentals then accelerate due to MOOD... Bear Markets start with a breakdown of fundamentals and then accelerate due to MOOD.
So.... if you follow the HERD's MOOD then during the PANIC you will panic...
But the CONTRARIAN point of view is when the HERD is in panic you are NOT.
As we enter the deflationary depression we will smile... because we knew it was coming and therefore we are not surprised... When the whole HERD is in full fledged depression... we are in full fledged Slap-Happiness...
OK ... now we have the bottom set for the year... I think... That being said we will seesaw till the end of the year... I thought for awhile there I was too late... I thought we were in the free fall already... The free fall, in my non-binding opinion, will probably happen in 2009.
The reigns that the newly established 'un-official' World Government have put on the beast are made of strings... they won't last... and may actually aggravate the Big Hairy Bear...
i still think we end this month around 9300 give or take 300...
We are NOT out of the woods... we are in a forest, in grizzly country.
The Socialist style interventions that the US is doing is already being dubbed the New Deal II. A serious look at the Depression of the 30's you will find that the New Deal did not recover the economy... it did keep people occupied but it did not 'fix' the economy... unfortunately Hitler did. The European war machine had to be built... and quickly.. so in multiple parts of the country, the engine was re-started. The Market was given the overhaul it needed... DEMAND.
So with nearly a 1000 point counter trend push the Dow will probably rise and fall and end this month near the 9300 mark.. with big ups and downs through the end of the year... the damage in industry has already hit though... the Auto industry is in the biggest slump in the last 20-25 years... the graph is car and truck sales over the last 10 years..
you can probably feel a little better about the end of this year... but the this is just a reprieve... and it may not go the way I say at all... we may see it all turn around and life will be 'good' again... but the odds are 80/20 that we are far from the bottom in the Dow and in our economy...
Elections are on the way... vote your conscience... remember there are unborn citizens who need you ...
Paulson.... said "What we have done is not what we wanted to do but what we MUST do to restore confidence in our financial systems."
that is soooooo backwards.... it is not improve MOOD then fundamentals... it is fundamentals first then the MOOD will follow....
there are no fundamentals that are improving.... there must be an exhaustion of the MOOD that was created by BAD fundamentals... then the bad is purged and the new GOOD fundamentals will begin and turn MOOD....
we are See Sawing through October..... if the MOOD goes down then I will be wrong and the bottom will blow out and WOW WEE bad stuff happens... if my opinion is correct the we SEE SAW till the end of the month and quite possibly go up to 10,700 by the end of the year and then 2009 will be very unkind to the Dow... and the economy.
"Who the heck are you to be predicting economic outcomes? Aren't you just a nurse?"
Yeah... that is true... but you keep looking don't you?'
Here's the deal 5 years ago I think I heard from God about the US economy... that we are headed for an extreme economic winter... then like a fool I began 'over' educating myself on the economy... and this has built up to a big O 'need' to express it... and sorry you're the recipeint...
I hope somehow people are preparing... not outa fear, but outa wisdom...
Remember that in a BEAR market that there are multiple IMPULSE jumps in the Dow. In an established BEAR market that one day gigantic jumps in the market are very common... it is a classic sign of BEAR markets.... in an established BULL market you will almost never see gigantic jumps in the Dow... the exception is at the very top before the next BEAR starts. So when we have these 936 point gains in one day... it should make us shutter.... because a few days later you will see a 733 drop in the Dow...
IF THE DOW stays above the low of 8451 we will end the year some where between 8900 and 10500... I know kinda broad... but at least it is not 4000...
BUT if the Dow goes below that point then I got no idea.... maybe 7200....
If you are still holding out for the big turn around... don't count on it... you have lost a bunch of money in your 401k... because the DOCTRINE is: just hold out.... you are investing for the long term... the market has ups and downs... When the market is down your money buys more shares and then when the market turns then you'll make more money.... of course in the 29 crash and the subsequent decimation of an 89% drop in the Dow the standard advise would take $50,000 to $5500 in less than two years....
what if you put in $45,000 of that money out of your wage? you would have lost it all but $500
This is the most historic thing that has happened in our lives.... unless you are over 80 years old... This time will be remembered greater than 9/11...
This moment in history opens the door to the most caustic and dangerous of all of mankind's inventions: COMMUNISM and it's devilish cousin SOCIALISM....
All modern countries that subscribe to these philosophies will collapse... because they survived because of the FREE MARKET SYSTEM in our country... which now the throat has been slit and it is bleeding out before our very eyes.
SOCIALISM ALWAYS FAILS
Capitalism works when SOCIALISM does not enter to try and fix the the downturns... (they are normal and needed)
Beware: THIS IS HAPPENING IN AN ELECTION YEAR... it is the perfect opportunity for a SOCIALIST to gain power...
When the the RICH are robbed to give to the poor the economic system turns to utter FRIGHT... See USSR, Cuba, CHINA during the Cultural revolution.... people no longer matter... it is the collective... SUFFERING is a rule because the individual is required to give up what they have EARNED to give to the groups that have not EARNED.
IF HE WINS YOUR EFFORTS WILL BE PENALIZED.... all who earn more through motivation and action and compliance to the free market system will be punished....
Setting goals that you intend to achieve will have a parasite..EVERYONE who DOESN'T set goals they intend to reach. CLICK ME
OK I have done my soapbox deal... I am anti-socialism because I am convinced that SOCIALISM/COMMUNISM is the counterfeit to the functioning Church of Jesus.
Re-Read Revelation 18... you decide we may be in for a BIG SPANKING
The Dow ended Down for the Day but Up for the Week... first up week in 5 weeks... today there was another SEE SAW in the magnitude of 545 points!
Now... is this because all-of-a-sudden the Financial world got all their ducks in a row and have corrected all the bad fundamentals in their industry? Of course not... SEE SAW till the end of the month.
When your friends and family in TX (which has the most robust economy that is left)... when they are being directly affected by the downturn in the economy the cold winds are blowing....
Why... I ask would Warren Buffet write an opinion article in a newspaper that tells people to start buying? He doesn't give a flip about whether you buy or sell...win or lose... get rich or poor... He is not a financial adviser... he is a contrarian investor who makes his money in down markets and up markets.... I'll tell you why... either he gotta phone call and was told to do it.... or he is needing to get out of some stocks and needs a 'pop'.
'Now's the time to buy!' you'll here from all the talking heads.... because even now the Bulls out number the Bears... in hope and promise. Wait till everyone and I mean everyone from Warren to Mr. MaGoo says "get out! get out! get out!" Then that is when you get in!
You see... if you moved your money to a money market fund in your 401k about 12 months ago.... you still have most of your money... Where as for instance my wife's 403b plan automatically re-allocated her money after the first of the year... after we had moved it to the safety of the MoneyMarketFund... and we didn't know it....
well needless to say it got SLAMMED even though they re-allocated it into bonds and 'safe harbor' investments....
The psychology of the Market... which is simply GROUP psychology, has not completed the predictable cycle it will go through...
Again, I recommend reading one of the books on my list... if you only read one, read Pretcher's book "Conquer the Crash" it is absolutely the cream... I heard him speak about 4 and a half years ago just after I was convinced that the economy was headed for winter... I was dumbfounded then... but now... I am totally weirded-out by the almost prophetic unfolding of what he was sure was going to happen. And the thing about it is... it is too hard to dismiss because it is all based on an Objective Technical look at the Market... not some psychic/voo-doo hoo ha.
I want everyone to know that I do not want the economy to crash... I want it to return to a state of steady climb... because it means that the rest of the world will suffer less... third world countries will continue to see help from people in our country who are open handed and sacrifice and suffer on purpose to help others... people motivated by the Indwelling... people who live simply so others can simple live... like Stanley Tam who gave 51% of his business to God.... and then later gave 100% to Him and only works for Him... a multi-billion dollar company... to Dr. McCall and family who gave up 'prosperity' to go and build and serve in Uganda... to those people who use the opportunities before them to make lots and lots of money... but don't keep it for themselves... I don't want those opportunities to be lost because of the public's choice to turn over title to the home of the free and brave to the counterfeits and lies that say you have rights to things you shouldn't... it is the right on all Americans to be free to pursue wealth or not... but it should not be the right of those who chose not too to be given someone else's wealth... Crazy how freedom of choice goes out the window when talking about issues of personal responsibility like health care coverage, financial opportunity, and the pursuit of something greater for your family and others less fortunate.... but when it comes to the issue pertaining to innocent life... Choice is the mantra... beware, socialists institutions are always compulsory... eventually the 'lie' of CHOICE, when it comes to abortion, will be exposed... just like in Socialist China where women are forced to have abortions 'for the greater good'.
I figure the majority of people on my list who stoop to read my rants mostly agree.... but I am sure some do not... I notice also that very few post comments... I don't know if it because you don't want to hurt my feelings if you disagree or you think I am a real case and just need a good laugh at times.... or maybe you are not too thrilled at this kinda news... or maybe the truth is you didn't know you could post comments.... you can and you can agree, disagree... or flat out need to give me 'the-what-for'... I won't be hurt and I won't hold it against you... some of my best friends are ultra-liberal socialists and I respect them... cause at least they have convictions... even though they are wrong :) JK
Thanks to everyone who reads this and doesn't drive by my house and egg my car.
Looks nice don't it? first day in more than 6 weeks that the DOW didn't go negative at some point... makes you feel better huh?... well remember in a established BEAR market big counter trend pushes are a normal part of the BEAR... in a BULL you get very steady baby steps up till the top comes... in a BEAR you have huge downward drops and aggressive upward counter trend pushes...
Now the question is is our prediction of 9300 at the end of OCT actually here early? Maybe... I also think that we may see 10,000 plus before the end of the year... But that may be me being positive... cause the fancy pants smarties who predicted all this downturn think it is goin south this year... well maybe... they sure can read the psychology better than me.
The Elliott Wave Theorists are still spot on... I mean SPOT ON! What do they say?
Absolute crash this week... to land somewhere around the 2003 low of 7200.
If you have not moved your money to cash yet... might as well wait... cause there will be some reprieve before the end of the year but I would not go into 2009 in stocks. you see the whole thing has come unraveled. The world economy is collapsing... The Currency of the world economy is ______ . That is correct you remembered that energy is... specifically Oil. The price of oil is below $60. Less than a year ago it was $147. OPEC is in a panic just like the FED... they have cut production to try and hold up the price... just like the FED does with interest rates to try and hold up money flow. Well just like the FED's efforts have failed... OPEC can not control the price of oil any longer... we are in DEFLATION... all markets, commodities, financial, real estate, and business are in rapid decline...
CAPITULATION.... no you do not need a shot for it... it is when the panic stops and a market bottom is found... we may see a type of capitulation this week... but it will not be a permanent bottom. Some other wild haired smarty pants said today that he expects the stock market to close for up to a week due to panic selling... that would be like a capitulation cathartic.
I still say 10,500 before the end of the year... but I have been wrong so far... wrong on the positive side... so I will let you know what the Elliott Wavers say... as they see it.
The Elliott Wavers said if the Dow closes above 8796 there will be a new look at the pattern developing... which is still very Bearish... Volatility...
This happens because of the SHORT COVERS.
What tha heck is that?
When you SHORT a stock, in effect you have borrowed a share and sold it in the market...expecting the price to go down... at that time you buy back the share at a lower price... return it to the person you borrowed it from and keep the profit.
Traders who short stocks need to buy back the stock to cover the loan... so they start buying like crazy and it drives the prices higher...
This was the second largest one day point gain in the history of the DOW.... the 1st one was two weeks ago... HUGE SWINGS.... Gigantic swings... this is not an indicator of a New Economy... the two days after the biggest one day jump we lost 90% of the gain and eventually lost it all and some...
A new Bull market will be 200 days of 25 point gains per day on average... that is a BULL.... a BEAR is 900 point up days and 1500 point down weeks....
Start praying for tiny little steps up in the Market... this will allow for the crazy volatility and down mood to work out... it's like when you feel bad or depressed everything stinks and nothing looks good... but when you feel good then the little things don't really bother you.
WOW.... on Oct 14th... the day after the largest one day increase in Dow History... the Dow lost 77 points.... then followed up with a 733 point decline on the 15th...
So is the pattern repeating? yes... or no... or maybe
The Elliott Wavers now have three scenarios that could happen... one is the Dow goes down sharply from here... the other two are up slightly to certain resistance points... then sharply down.
For those who have read up on Elliott Wave theory the Macro picture at this point is a confirmed Grand SuperCycle Bear Market that will likely not end till the Dow has retraced at least 89% from the top... which is some number between 400 and 1600. They expect this to unfold over the next 4 to 7 years...
Refresher course on Elliot Wave Theory: The wave principle posits that collective investor psychology (or crowd psychology) moves from optimism to pessimism and back again. These swings create patterns, as evidenced in the price movements of a market at every degree of trend.
From R.N. Elliott's essay, "The Basis of the Wave Principle,"
Practically all developments which result from (human) socialeconomic processes follow a law that causes them to repeat themselves in similar and constantly recurring series of waves of definite number and pattern. R. N. Elliott's model, in Nature’s Law: says that market prices alternate between five waves and three waves at all degrees within a trend, as the illustration shows. As these waves develop, the larger price patterns unfold in a self-similar fractal geometry. Within the dominant trend, waves 1, 3, and 5 are "motive" waves, and each motive wave itself subdivides in five waves. Waves 2 and 4 are "corrective" waves, and subdivide in three waves. In a bear market the dominant trend is downward, so the pattern is reversed—five waves down and three up. Motive waves always move with the trend, while corrective waves move opposite it.
The principle behind this look at the market is that it takes out the wishful thinking and dread... because the presence of the waves are so consistant... even from the beginning of a recorded market like the Tulip trade in the 900's... there is confidence in the theory and therefore is more trustworthy than emotion... not fullproof mindyou but more trustworthy than the 'hunch' system.
everything above this line is OPINION __________________________________________________________________ now all that said... TRUST IN THE LORD with all your heart and He will give you His insight and His mind... and He knows already the final outcome... He is there waiting on us and is here with us wanting to take us there...
9,325.01 +144.32(1.57%) That is scary!! I wish I was smart enough to know why.
The problem now arises: If Steevo's non-binding opinion was correct about the Dow at the end of Oct.... do I believe everything else?
Man... I am sorry... I wish I was wrong.... that way the pressure is off me and I could just say I missed it and you could just be entertained by my silliness...
I am now torn between two scenarios:
1. The Dow continues upward to hit my countertrend target of 10,300-10,500 then a follow up extreme crash to 7000-7200.
2. The Dow very early in November crashes to the 7200 level then turns around to 9100-9300 then peters out and begins the super slide to very very low lows... like 4000...
Them's my opinions and they sorta match the Elliott Wavers. They expect the crash from here comes sooner rather than later... but it's like 48% to 43% :)
Either way the economy is going to meltdown (or is melting down) and life is going to change...
This is because the underlying fundamentals of our economy are totally busted...
Once a economy based on real money we moved to a fiat currency with a real money backing... then to a fiat currency backed by goods and services... to a currency backed by debt... the cycle is now complete.... we will move back to a economy backed by real money... or maybe further back to a barter system first...
Economies that are based on a free market expand and contract... the expansion/contraction is present at every degree... minute by minute, decade by decade, to century by century... those who position themselves at the top to reap the benefit from the contraction then turn around at the bottom to reap the benefit from the expansion obviously have an upper hand. Who are these people? Contrarians.... how do they know when the bottoms and tops come? Not by emotions and not by investor advise but buy an objective system that looks technically at the Market.
Subscribe to this Site
December, 2007
