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Realistbear

Another White Thursday As Optimism Sends Stocks Soaring

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FTSE 100 5,681.26 +38.76 +0.69%

Dow Jones 11,255.78 +249.76 +2.27%

NIKKEI 10,168.52 +180.47 +1.81%

Irrational exuberance of have they really fixed the world's economic problems so quickly....and painlessly. Who is buying stocks in the face of such global disasters as rising Bond rates, job losses and overcapcity with falling demand?

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According to the boys and girls in the know - I will say no more - there was lots of short covering buying going on yesterday because shorters are worried about what the ECB is going to say today/perhaps printy printy.

So in a bizarre twist of stuff people who think the markets are about to tank, and who have shorted it accordingly, have pushed up share prices by covering their shorts.

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Ok, I'll play devil's advocate. Is it perhaps possible that things aren't as bad as they've been made out to be? Traders love volatility and they've been creating it. But perhaps the fundamentals of the real economies are over the hump? Perhaps the bailout of Ireland is the turning point?

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Irrational exuberance of have they really fixed the world's economic problems so quickly....and painlessly. Who is buying stocks in the face of such global disasters as rising Bond rates, job losses and overcapcity with falling demand?

Does this help your comprehension of the last two days?

60924662.jpg

Also, do you understand how shorting works? :blink:

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According to the boys and girls in the know - I will say no more - there was lots of short covering buying going on yesterday because shorters are worried about what the ECB is going to say today/perhaps printy printy.

So in a bizarre twist of stuff people who think the markets are about to tank, and who have shorted it accordingly, have pushed up share prices by covering their shorts.

When you can see a double bottom, you need to close your shorts.

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Does this help your comprehension of the last two days?

60924662.jpg

Also, do you understand how shorting works? :blink:

Stocks are mostly bought on the basis of future earnings. Shorting is a S/T gamble that many would like to see ended.

Future earnings depend on present circumstances and likely outcomes. "Growth" is the principle fundamental that most investment managers base decisions on. Warren Buffett, one of the best, looks at the management team, the product and the market potential before buying. He does not look at who is shorting.

At times of high volatility there may be a lot of day traders and hedge funds manipulating the market but it seems that recent rises are the result of exhuberance and hope that the CBs have sorted the troubles. Some say the CBs are themselves buying stocks but I see no evidence of this.

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Ok, I'll play devil's advocate. Is it perhaps possible that things aren't as bad as they've been made out to be? Traders love volatility and they've been creating it. But perhaps the fundamentals of the real economies are over the hump? Perhaps the bailout of Ireland is the turning point?

Tis like Schrodinger's cat. There is a chance that we will be hit by a deflationary storm, which will wipe out equity almost everywhere.

There is also a big chance that TPTB will print, causing inflation, devaluing debts, and send equity to the moon.

So the only fair price is one in the middle. As the chances of each outcome change, so does the price of equity. Chances of a big print run are rising by the day.

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Does this help your comprehension of the last two days?

60924662.jpg

Also, do you understand how shorting works? :blink:

trouble is the "News" is about today, or this afternoon....trends are ignored by the MSM it seems.

Shorting.....there are rumours that JP Morgan have shorted more SIlver than there is in existence...a naked short I gather....whats your view on this....and if people wanted to shaft JPM, then that would put the price of silver up....which it has....currently 28.56

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Tis like Schrodinger's cat. There is a chance that we will be hit by a deflationary storm, which will wipe out equity almost everywhere.

There is also a big chance that TPTB will print, causing inflation, devaluing debts, and send equity to the moon.

So the only fair price is one in the middle. As the chances of each outcome change, so does the price of equity. Chances of a big print run are rising by the day.

The print run has been going on for months. The ECB have admitted it and the Fed have been openly printing for some time.

The problem is that the printing is not having the desired effect (inflating debt away). It is pushing up bond rates and causing the recessions to deepen (except here where the price for the Brown years sems to have been delayed).

They are all terrified of deflation and there may be a reason for this.

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The print run has been going on for months. The ECB have admitted it and the Fed have been openly printing for some time.

The problem is that the printing is not having the desired effect (inflating debt away). It is pushing up bond rates and causing the recessions to deepen (except here where the price for the Brown years sems to have been delayed).

They are all terrified of deflation and there may be a reason for this.

I thought that the objective of printing was to push up the rates of interest demanded by holders of bonds? They do this when the market has expectations of inflation rather than deflation.

Sure the short term affect is to drive rates down as bond prices are bid up by Open Market Purchases, but as more money floods into the system, the opposite affect occurs, and the market is less willing to hold bonds.

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Stocks are mostly bought on the basis of future earnings. Shorting is a S/T gamble that many would like to see ended.

Future earnings depend on present circumstances and likely outcomes. "Growth" is the principle fundamental that most investment managers base decisions on. Warren Buffett, one of the best, looks at the management team, the product and the market potential before buying. He does not look at who is shorting.

At times of high volatility there may be a lot of day traders and hedge funds manipulating the market but it seems that recent rises are the result of exhuberance and hope that the CBs have sorted the troubles. Some say the CBs are themselves buying stocks but I see no evidence of this.

My point was:

1. If you are bullish on the FTSE yesterday presents a decent buying opportunity as it is a second successive higher low since July.

2. As it hit a low and there is the upcoming ECB speech, then yesterday presented a good time to exit a short

3. The market has been selling off since November. It will take a breather, and the bottom of a bollinger band is not an uncommon place for it to occur.

4. There are hence a million and one reasons why the market may act in a certain way on any given day. Further you can look at the chart I posted and interpret it bullishly (point 1) or bearishly (points 2 and 3). Again you could apply fundamental analysis or a million other indicators.

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  • 284 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%



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