Black Monday

[Lost Weekend]

i have to say its a bit of a disgrace to see people hoping for a meltdown in the country... just so that they can get a step on the property ladder.

some people talk about the selfishness of btl'ers however perhaps they should look in the mirror first before they are so quick to judge. many seem to be actively looking forward to an economic breakdown of the country for their own personal gain and smacks of hypocrisy.

i personally think prices will fall naturally as it is not fundamentally sustainable but for some to hope for stock market crashes, unemployment, bankruptcies, threat of war just so that it can impact house prices, shows exactly the type of self centeredness that people themselves are moaning about. some have in effect become the very people they despise.

Post of the thread, by a long margin.

If property prices crashed this month, given that I sold to rent last month, I'd be up by a long way. I however do not want to see that happen as it would be extremely bad for the UK as a whole, and next to nobody would benefit.

Sure there are plenty of people who think they'll benefit, but most will not. Ask yourself this, how many people's lifestyle improved in the last recession? That's right, not a single person who wasn't all ready loaded before it began.

[Goldfinger]

credit expansion is designed to create liquidity in the economy which encourages spending and thus economic growth. credit can be withdrawn by the bank of england if they really wanted to by selling bonds in the repo markets, but they dont because the objective is economic growth. what you fail to comprehend is that the end goal is for economic growth (not balancing money supply), but your arguement is that the best way to achieve this is via a recession. thats just stupid.

I think what some people (especially in government) seem to forget about is that money finally

cannot be "created". Money evolves from trading, and is usually the commodity/commodities

that are most suitable for transacations and also store of wealth. This is why for the last

couple of thousand years gold and silver were used for this purpose. There is nothing bad about

that. There is also no reason why an economy with a gold-backed currency should not grow. And if

wealth had been accumulated in years before, it could be given away as credit in bad years to

stimulate growth.

Only, restricted by nature, this credit expansion could not go on for ridiculous long perdiods

of time, leading to an even worse shrinking of the economy when things finally become

unsustainable. This is what we are witnessing (or will be witnessing). There can be healthy

economic growth. What we see, however, is stimulation that is backed by NOTHING. There is no

wealth that has been accumulated and is now used for stimulation. By creating new fiat money/

credit, part of the monetary wealth that is out there is taken away from the owners (by inflation)

and (in some sense) pumped back, to only create more pain (HPI + HPC).

Using money that is not backed by "natural" money, i.e. a commodity, is like flying a plane

without having built the landing strip. The only reason you know that you're still flying is, that

you have been on the ground before and you haven't yet hit it again. We're in the air since

1971. For some reason, we're still flying.

[mrpleasant]

Fair point, but there's no anaesthetic for people who have overloaded portfolios or those who have bought at the top. Those of us who have been knocking around for a while have witnessed at the very least, and probably experienced first hand, the effects of property and stock market falls. It bloody hurts. 'Correction' is a wonderfully bloodless term that hides the brutal reality. No compassionate person would wish this ill on anyone, but it will make no difference how we as individuals feel about it when it happens.

[cells]

You're not really a student are you, cells?

The above question leads me to believe you are Gordon Brown. Or maybe you work at the Bank of England?

would love either job tbh,

i was just pointing out that credit expansion can create economic growth but that is not the only consequence, i just posted it in a form of a question

[LazyDay]

seems like FTSE is likely to open low tomorrow.

In fact, what we need is not a crash in SM but a surge in volatility,

or implied volatility. That will suck cheep creadit out.

[Guest The_Oldie]

When do the Far East markets open?

[slurms mackenzie]

When do the Far East markets open?

I think tokyo opens in about 3 hours (based on a crappy cross reference i did between google and bloomberg)

Futures for the dow suggest it will go below 12k, the predicted waters for the ftse are less choppy.

I know next to nowt about trading but i can see this week being one full of further falls as theres been a turn in sentiment, i only have about 12k invested in large caps so it almost seems pointless trading.

Edited March 4, 2007 by slurms mackenzie

[Guest Charlie The Tramp]

When do the Far East markets open?

New Zealand 2200 GMT

Australia 0000 GMT

Japan 0000 GMT

China 0130 GMT

Hong Kong 0200 GMT

Markets Clock

[Guest wrongmove]

Post 9/11 interest rates were lowered and money supply went into overdrive to stop a depression.

Now look where we are we !

Er, not in a depression....?

[domo]

not only is credit creation a poor way to stimulate the economy, it reduces the quality of growth. hence why the manufacturing sector of this economy has been decimated - leading to a requirement to build up huge deficits and higher debt levels, debt encorouges consumption and speculation, not production, it encourages asset price growth, which as we know on this forum has done nothing but decrease the quality of life for us. We think the economy has foundation in our "new" services sector, but thats false, our economy rests on vast credit creation, a welfare state that burdens production, and financial speculation.

[Wuluf]

would love either job tbh,

i was just pointing out that credit expansion can create economic growth but that is not the only consequence, i just posted it in a form of a question

War can also lead to economic growth..

Problem is that economic growth (solely) by means of credit expansion or War is not sustainable.

[Realistbear]

have all you guys who are forecasting 500 pts off the FTSE tomorrow liquidated your insurance and pension funds?

I rebalanced my mutual fund portfolio after the Shanghai Shakeout from 60:40 (stocks:cash and bonds) to 80:20. Sold all my UK stocks. Caution is the name of the game now. UK Pension with Scottishwidows and its one of the old ones that you can't tinker with until you draw it out.

Edited March 4, 2007 by Realistbear

[Charliemouse]

I have often wandered, after Tony Blair won the election in 1997 thair was a report that he was reading a book called "Living on thin air" by Charles Leadbeater. I havnt read it myself but the title dosn't sound like a philosophy that any sane person should follow.

Perhaps he has had this title in the back of his mind during his time in no' 10.

Now that the air is getting very thin indeed, i wander if tony still flicks through it.

I think Monday (tomorrow) will infact be the beginning of the blackest period in the UKs financial history. I simply can't emagin Gordon Brown in No' 10 but it will be hillarious to listen to him trying to deflect the blame from himself as the country skydives into resession.

[Tempest]

I have no idea whether a SM crash will occur next week. I think one may occur in the next year and I am certain one will occur in the next 10 yrs...

BUT, just because there are (in some people's eyes) no good reasons or insufficient reasons to expect a crash in stock markets, that does not mean there cannot or will not be one.

I remember the 1987 crash - took everyone by surprise in what was otherwise a period of high growth - things had just got ahead of themselves. The speed and scale were unbelievable and to this day noone has a single reason why it happened - lots of partial justifications in hindsight but no fundamental "cause".

I particularly like this collection of 1987 quotes: http://www.lope.ca/markets/1987crash/quotes.html

[justanewbie]

Post of the thread, by a long margin.

Sure there are plenty of people who think they'll benefit, but most will not. Ask yourself this, how many people's lifestyle improved in the last recession? That's right, not a single person who wasn't all ready loaded before it began.

=====================================================================

In fact, market corrections are a good and necessary thing.

The market becomes more stable, less twitchy, less volatile, with a stronger foundation.

As with the Stock Market correction, China is already stabilising - a Govt announcement, and a small uptrend

showing an increased stability will attract investment.

A correction is when prices adjust to true value - always a good thing .

[Gtr London FTB]

New Zealand 2200 GMT

Australia 0000 GMT

Japan 0000 GMT

China 0130 GMT

Hong Kong 0200 GMT

Markets Clock

Australia actually opens at 2300 GMT

[Guest Charlie The Tramp]

New Zealand is trading, open now for 20 minutes

Market Data - 5 March, 10:19 Headline Indices

Index Value Movement (%)

NZX 50 4079.3 -0.48%

NZX 15 7483.4 -0.67%

NZX 50 Portfolio 2404.9 -0.34%

NZX SciTech 1393.5 -0.40%

New Zealand Stock Market

[Pluto]

not only is credit creation a poor way to stimulate the economy, it reduces the quality of growth. hence why the manufacturing sector of this economy has been decimated - leading to a requirement to build up huge deficits and higher debt levels, debt encorouges consumption and speculation, not production, it encourages asset price growth, which as we know on this forum has done nothing but decrease the quality of life for us. We think the economy has foundation in our "new" services sector, but thats false, our economy rests on vast credit creation, a welfare state that burdens production, and financial speculation.

Yep, that about sums it up.

[homeless]

New Zealand is trading, open now for 20 minutes

Market Data - 5 March, 10:19 Headline Indices

Index Value Movement (%)

NZX 50 4079.3 -0.48%

NZX 15 7483.4 -0.67%

NZX 50 Portfolio 2404.9 -0.34%

NZX SciTech 1393.5 -0.40%

New Zealand Stock Market

NZX 50 4073.5 -0.62%

NZX 15 7468.1 -0.88%

NZX 50 Portfolio 2402.0 -0.46%

NZX SciTech 1393.2 -0.42%

this is 5 mins later charlie , getting worse by the minute

[Pluto]

NZX 50 4073.5 -0.62%

NZX 15 7468.1 -0.88%

NZX 50 Portfolio 2402.0 -0.46%

NZX SciTech 1393.2 -0.42%

this is 5 mins later charlie , getting worse by the minute

HSBC should tank the FTSE nicely in the morning.

[Guest Charlie The Tramp]

Less than an hour`s trading

Headline Indices

Index Value Movement (%)

NZX 50 4069.2 -0.72%

NZX 15 7462.3 -0.95%

NZX 50 Portfolio 2399.4 -0.57%

NZX SciTech 1390.7 -0.60%

[the end is a bit nigher]

I would expect a decent bounce later in the week when data shows things aren't as bad as people think

[tahoma]

I would expect a decent bounce later in the week when data shows things aren't as bad as people think

What's Star Trek Next Gen got to do with it?

Seriously, 'data'? You mean, made-up-stats-to-placate-the-masses?

[the end is a bit nigher]

What's Star Trek Next Gen got to do with it?

Seriously, 'data'? You mean, made-up-stats-to-placate-the-masses?

made up or not, that's what traders seem to use these days - now if the BoE were to put rates up then that might shock the market further, but i have given up on them doing anything sensible

[Guest Charlie The Tramp]

Australian Stock Exchange opens 2300 GMT and starts downward.

index value change numeric change

S&P/ASX200 5770.9 -15.1

ALL ORDS 5760.9 -14.3

5 minutes trading and

S&P/ASX200 5756.7 -29.3

ALL ORDS 5746.5 -28.7

And further

S&P/ASX200 5740.7 -45.3

ALL ORDS 5730.7 -44.5

S&P/ASX200 5718.5 -67.5

ALL ORDS 5708.7 -66.5