Jump to content
House Price Crash Forum
Georgia O'Keeffe

Switching To Bear Status

Recommended Posts

After more than 18 months since stumbling across HPC via an excellent article on K Winters and waiting for the various markets to reach potential price targets its finally time for me to switch over to the dark side of Bear Status.

Technically great potential for a reversal from these values, ( if its still a nominal price bear market id say it pretty much has to reverse from these levels)

Sentiment wise although for completely different reasons to 07 the extreme asset price bullishness is about as perfect as it gets for a top

In homage to CGNAO by Mid 2013

Halifax Index 164K to 100K

FTSE 5890 to 2500

Dow 11420 to 4000

Gold 1394 to 500

Silver 2673 to 850

GBP/USD 1.62 to Sub Parity

cat.jpg

Protect Yourself - Buy A Fondue Set

Disclaimer: The information/material provided in this post may be misleading due to the owners keyboard running out of zeros, the poster expressly disclaims to the maximum limit permissible by law, all warranties, express or implied, including, but not limiting to implied warranties of merchantability, fitness for a particular purpose all responsibility for any loss, injury, liability or damage of any kind resulting from and arising out of this post, very few cats were harmed in any way in the creation of this post

Share this post


Link to post
Share on other sites

In homage to CGNAO by Mid 2013

Halifax Index 164K to 100K

FTSE 5890 to 2500

Dow 11420 to 4000

Gold 1394 to 500

Silver 2673 to 850

GBP/USD 1.62 to Sub Parity

To sum it up, you are bullish on the dollar and bearish on the UK economy.

However, if you think the Dow will collapse to those levels, you basically need the bankruptcy of IBM.

Edited by Ah-so

Share this post


Link to post
Share on other sites

To sum it up, you are bullish on the dollar and bearish on the UK economy.

However, if you think the Dow will collapse to those levels, you basically need the bankruptcy of IBM.

i dont think Dow 4k represents a collapse, just a correction, due to the unique calculation of the Dow IBM is twice as big a factor as any other component but i certainly dont think its going Chapter 11, the reason im posting this is becauseif this is a nominal bear market, everything is pretty much perfect for a top, it hasnt been this perfect for 18 months, it may be completely wrong but if it is going to reverse it will do so from here, at no point in the last 18 months has there been any reason to not be bullish as far as my interpretation goes, now there is

Edited by Tamara De Lempicka

Share this post


Link to post
Share on other sites

After more than 18 months since stumbling across HPC via an excellent article on K Winters and waiting for the various markets to reach potential price targets its finally time for me to switch over to the dark side of Bear Status.

Technically great potential for a reversal from these values, ( if its still a nominal price bear market id say it pretty much has to reverse from these levels)

Sentiment wise although for completely different reasons to 07 the extreme asset price bullishness is about as perfect as it gets for a top

In homage to CGNAO by Mid 2013

Halifax Index 164K to 100K

FTSE 5890 to 2500

Dow 11420 to 4000

Gold 1394 to 500

Silver 2673 to 850

GBP/USD 1.62 to Sub Parity

If you are correct, I will be a very happy man.

Along with this, do we get 10 year Notes trading at around 1.5% and 10 year Gilts trading at around 7%?

Share this post


Link to post
Share on other sites

My prediction is the reverse. Whilst the sheeple will get poorer I see a multi year boom in stock markets and commodities.

With regards to house prices I have no idea now. I think there will be a significant drop in real prices but not a big enough drop in nominal prices to make it worth while holding on more than a few years. When I finish my training by mid 2012 I will be looking to buy my home regardless of what the price action is.

The FED has nailed its colours to the mast. They will print till the cows come home and this money will flow into assets as it has nowhere else to go.

It will be a volatile ride but a lucrative one for those willing to invest.

Share this post


Link to post
Share on other sites

I really respect your analysis Tamara. Your whole view on the basic moves, their scale, and their order, matches my intuition.

So to me, this is exciting news! Thanks and keep posting. :D

well it could be cobblers and completely wrong but as i said, as far as i can see its the first time it makes sense to be bearish in the last 18 months and if it wrong and markets continue to rise then the loss is minimal between here and the 07 high

Share this post


Link to post
Share on other sites

I really respect your analysis Tamara. Your whole view on the basic moves, their scale, and their order, matches my intuition.

So to me, this is exciting news! Thanks and keep posting. :D

A simultaneous war between central banks and a sovereign debt crisis in one of the PIIGS will probably be the catalyst.

I have no idea when the move will start but I can feel its shadow being cast over the financial landscape.

Share this post


Link to post
Share on other sites

A simultaneous war between central banks and a sovereign debt crisis in one of the PIIGS will probably be the catalyst.

I have no idea when the move will start but I can feel its shadow being cast over the financial landscape.

i did notice fridays action in the ibex and the Borsa Italiana

Edited by Tamara De Lempicka

Share this post


Link to post
Share on other sites

well it could be cobblers and completely wrong but as i said, as far as i can see its the first time it makes sense to be bearish in the last 18 months and if it wrong and markets continue to rise then the loss is minimal between here and the 07 high

Thanks for this TDL - your posts are always interesting.

So for all the STRs on here who are waiting for a proper HPC, what's your advice? What should they be doing with their STR funds? I'm not talking returns, more like preservation of wealth while UK house prices fall.

I'd love to see you suggest a workable portfolio for these troubled times...

Share this post


Link to post
Share on other sites

Thanks for this TDL - your posts are always interesting.

So for all the STRs on here who are waiting for a proper HPC, what's your advice? What should they be doing with their STR funds? I'm not talking returns, more like preservation of wealth while UK house prices fall.

I'd love to see you suggest a workable portfolio for these troubled times...

i cant give advice because im as likely to be totally wrong as anyone else but the only neutral portfolio i can see is half PM, half USD ( that is the only cover i can see for both eventualities) but that is not my portfolio because as the wife says, i like to risk it for a biscuit

Edited by Tamara De Lempicka

Share this post


Link to post
Share on other sites

Im a novice to all this really, but trying to learn and protect myself.

The only danger to your forecasts is QE, lets face it without QE we would have seen all that come true all ready. Now that's not saying going forward more QE will 100% have the same effect, but.

Share this post


Link to post
Share on other sites

Like your style, Tamara. I hope you are right.

Not because I want to see death and destruction, but because I believe that these conditions are needed to clear out the corruption of the political/economic complex.

Whilst what you have described, is inevitable, I think that the timing of this all lay in the hands of the central banks. I am expecting that Bernanke is going to be put under enormous scrutiny next year, if not sooner. This could be the trigger.

Good luck.

John Taylor. manager of the world's biggest currency trading fund, agrees with you on the dollar thing, he's 14% up on the year...

Share this post


Link to post
Share on other sites

In homage to CGNAO by Mid 2013

Halifax Index 164K to 100K

FTSE 5890 to 2500

Dow 11420 to 4000

Gold 1394 to 500

Silver 2673 to 850

GBP/USD 1.62 to Sub Parity

The people with the most wealth control what happens. Where is their profit in that scenario?

Share this post


Link to post
Share on other sites

The people with the most wealth control what happens. Where is their profit in that scenario?

People buy stocks to get rich and bonds to stay rich.

If we get a sell-off as big as this, the rich will sell some of their bonds and use some of their cash to buy assets at prices that make long term sense.

Once in a generation, capital returns to its "rightful" owners : the prudent and conservative. This might be this generation's moment.

Share this post


Link to post
Share on other sites

After more than 18 months since stumbling across HPC via an excellent article on K Winters and waiting for the various markets to reach potential price targets its finally time for me to switch over to the dark side of Bear Status.

Technically great potential for a reversal from these values, ( if its still a nominal price bear market id say it pretty much has to reverse from these levels)

Sentiment wise although for completely different reasons to 07 the extreme asset price bullishness is about as perfect as it gets for a top

In homage to CGNAO by Mid 2013

Halifax Index 164K to 100K

FTSE 5890 to 2500

Dow 11420 to 4000

Gold 1394 to 500

Silver 2673 to 850

GBP/USD 1.62 to Sub Parity

If you are a nominal bear then this is exactly the call you should be backing.

Since last year and the dead cat bounce in property I have been stating November 10 would be a pivotal point. Either we return to the bear market in both housing and equities or the inflation effects caused by QE would be doing the damage in real terms.

I hold the view that central banks can only have any hope of getting us through this if they spread the pain over the next 10-15 years. As Tamara De Lempicka states 4000 is not a collapse of the DOW it is a correction and central banks would still be successful if they achieve this as a natural bottom. Therefore the central banks must avoid hyper deflation and hyper inflation..

In 06 it was evident the US housing market was going to cause devastation and be highly deflationary, it took 2 years to convince everyone the FED was going to bail everyone out and gold,oil and commodities peaked. There were food riots around the globe due to the stress of the FED's intervention becoming too great, then they let Lehman Brothers go down and people jumped on the deflation trade. We are nearly 2 years into the reflation trade and we are get dangerously close them loosing control of the inflation trade.

If they are trying to achieve managed deflation, as per my thesis, then we are due a sustained period of controlled deflation.

Share this post


Link to post
Share on other sites

People buy stocks to get rich and bonds to stay rich.

If we get a sell-off as big as this, the rich will sell some of their bonds and use some of their cash to buy assets at prices that make long term sense.

Once in a generation, capital returns to its "rightful" owners : the prudent and conservative. This might be this generation's moment.

But you didn't say they would sell their shares so how can there be such a large sell off?

I regret to say, given my own precarious financial position, that the sell off has been and gone. I am not a financial trader at all but even I was thinking about buying shares when the FTSE fell which has since proved to be the bottom.

Tamara's view is the exact opposite of Nadeem Walayat and the last couple of years his inflation megatrend has proved spot on. With Bernanke rubbishing cash what is going to make people want to sell stocks and gold?

Share this post


Link to post
Share on other sites

I think everything now depends on politics, particularly whether the new blood in the US on the right wing do anything about the Fed.

I dislike pretty much everything the likes of Glenn Beck and the Tea Party stand for, but the one positive influence they may have is to get some proper oversight of the Fed. Fox News have done pieces on hyperinflation, and their championing of Hayek's Road to Serfdom got it to No.1 on the Amazon bestseller's list, and I think anti-Fed sentiment will gain some traction as we go forward. Probably not enough, though.

Without political will to rein in the Fed, though, I can't see there being nominal falls of the kind predicted by the OP. I also think that war (i.e. actual, not currency war) is more likely than the Dow getting to 4000. Krugman has been hinting at war in Iran being a solution to US problems for months now, and the fact that he still has a platform to spout his dangerous nonsense to me suggests that he may have a few supporters among decision makers.

In summary, everything depends on politics, and the political situation has never, in my lifetime, been so fragile and unpredictable.

The tuppenceworth.

Share this post


Link to post
Share on other sites

In summary, everything depends on politics, and the political situation has never, in my lifetime, been so fragile and unpredictable.

I think you are making the mistake of thinking that the politicians are in charge. It's the money men who are in charge. How else could you explain what has happened recently? The public have been lined up, each holding a jar of KY jelly.

Share this post


Link to post
Share on other sites

But you didn't say they would sell their shares so how can there be such a large sell off?

I regret to say, given my own precarious financial position, that the sell off has been and gone. I am not a financial trader at all but even I was thinking about buying shares when the FTSE fell which has since proved to be the bottom.

Tamara's view is the exact opposite of Nadeem Walayat and the last couple of years his inflation megatrend has proved spot on. With Bernanke rubbishing cash what is going to make people want to sell stocks and gold?

Wealthy people tend to have conservative, balanced portfolios. Diversification and rebalancing are the only free lunch in the market.

A rout in stocks will leave their portfolios unbalanced so they will rebalance by reducing cash and bonds in favour of stocks.

Rebalancing a fixed asset allocation is the only way to buy low and sell high with reasonable success. To prevent rebalancing into oblivion, many of them also have floors on the amount of bonds, ounces of gold etc that they hold.

I expect that it will be the speculative element of the market (do I remember correctly that 70% of all stock trades are held for 11 seconds or less?) rather than the wealthy that will bear the brunt of the losses.

For the truly wealthy, market volatility is something to embrace rather than fear. It lets them buy high and sell low more frequently when their asset allocation becomes unbalanced.

Share this post


Link to post
Share on other sites

But you didn't say they would sell their shares so how can there be such a large sell off?

I regret to say, given my own precarious financial position, that the sell off has been and gone. I am not a financial trader at all but even I was thinking about buying shares when the FTSE fell which has since proved to be the bottom.

Tamara's view is the exact opposite of Nadeem Walayat and the last couple of years his inflation megatrend has proved spot on. With Bernanke rubbishing cash what is going to make people want to sell stocks and gold?

i like Nadeem Walayat, i think hes one of the best forecasters going, i have loads of respect for him and weve been in reasonable sync for the last 18 months, but at this juncture i disagree with him, i can only go with what i interpret, he could well be right but nobody should let anyone else influence their own decision, as for what can change, thats yet to be found ot but i put a far stronger weighting on social interraction/trends than govt interference/trends, we'll see what comes up trumps in due course

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 146 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.