Black Monday

[bugged bunny]

Theres a thought. "Black Monday". I assume this is refering to a correction in the stock market. I also think a lot of people will have a lot less money in their pockets. If this is the case then I have Black Monday everyday and so do a lot of other people I know too.

I will be watching the carnage with a cheeky smile on face to see the banks and investment groups losing a few pounds of the flesh they take from the hard earners.

Tonight we have total eclipse of the moon on the Ides of March, a bad omen if ever there was one.

If we see another 'Black Monday', I wonder how it will come to be known? I expect the journos have already agreed on an epithet.

What do we reckon folks?

Meltdown Monday?

[Realistbear]

"The easy money is gone

Without much fanfare over the past few months, banks, mortgage companies and other lenders have been turning off the faucet that had provided easy money to everybody, even those with no possibility of ever repaying the loans.

Easy credit wasn't just Fed policy; it was the policy of every lender, every realtor, every automaker. It kept the economy afloat in late 2001 when it really mattered, and it provided most of that extra cash consumers needed to spend when their wages were flat in 2003 through 2005. It was easy credit that put millions of SUVs on the road, it was easy credit that inflated the housing bubble and it was easy credit that boosted the earnings of financial companies."

And with the easy money goes Gordon's miracle. Never ending HPI-MEW was only possible with unlimited credit and the idea that debt was illusion and house prices real. Things should start to look good for some house price falls by 2nd Q 2007.

It was never about IR. Miracle Economies and IR are in two different worlds and ne'er the twain do meet.

[Realistbear]

Tonight we have total eclipse of the moon on the Ides of March, a bad omen if ever there was one.

If we see another 'Black Monday', I wonder how it will come to be known? I expect the journos have already agreed on an epithet.

What do we reckon folks?

Meltdown Monday?

Well it began with the "Shanghai Shakeout" and it will eventually be merged into "Great Crash II" an all ecompasing financial category 10 storm that will lay waste to every commodity that has risen beyond the fundamentals. House prices will be mere froth in the face of its winds and stocks will resemble straws blown by such force that they will strike at the very foundation of the City of London causing tens of thousands to lose jobs as the bear market reduces trading to a tiny trickle. The smart city workers who hung onto their bonuses instead of feeding an asset bubble will survive the longest. Those who bought a 3 million pound two up and two down in Chelsea will see 60% of their wealth gone in a matter of months. SUVs and big Mercs will find their way onto the Auto-trader for pennies on the pound. A simple phrase will come to dominate the financial landscape : For Sale.

Edited March 3, 2007 by Realistbear

[nomoney]

Things should start to look good for some house price falls by 2nd Q 2007.

Resistance is futile.

It like this. Billions of pounds were wiped off the value of shares just last week and that is just the tip of the iceberg. Confidence in the stock market is like playtime at junior school - kids running around all over the place going nowhere.

No one on here is disputing the fact that Monday is looking a bit ropey. A nice change when everyone agrees. Banks and finance companies are the biggest investors in the stock market (especially Barclays). When they see the bottom line eroding and they will. The next step is a board meeting will be called to stop losses and they will do what they always do, cease easy credit and credit tightening in order to reduce bad debts.

When you ring up and cant get a mortgage for your the massively inflated house you want to buy, you realistically have 2 choices :

1. Buy a cheaper house.

2. Borrow at a higher rate.

Option 2 is what most people call the sub prime market, but with interest rates possible rising and mortgages more expensive than ever there is only one option left on the table.

1. Buy a cheaper house. Guess what there arnt any. So people stop buying and house prices crumble, once it starts it will last for years maybe even a decade like in Japan.

So that said. Pull up a chair, watch the news with a can of bear in your hand and make a toast to the Gordon Brown and his Miracle Economy on Monday.

The only miracle is it has run on as long as it has.

Now its time to pay the piper and no-ones leaving the table until the bills paid.

Edited March 3, 2007 by nomoney

[Ash4781]

http://newsvote.bbc.co.uk/1/shared/fds/hi/...ilt/default.stm

UK gilts green

How far along is the carry trade unwinding ?

[Guest Yeahbutnocrash]

All the pieces are falling into place for Black Monday next week:

++ Sub Prime implosion in the US

++ Yen Carry trade starting to unwind

++ Global Stock markets on the verge of collapse

++ Commodity prices taking it in the backside

++ Irag

++ Afgahanistan

++ Iran

++ Higher Energy costs

++ Bubble Property prices in the UK

++ Bubble property prices bursting in the US

++ Riot breaks out at a council meeting in the epicenter of the global property bubble (Camden).

This is major bear food..

er.. I thought some energy prices are on the way down aren't they? eg. British Gas

[Guest grumpy-old-man]

er.. I thought some energy prices are on the way down aren't they? eg. British Gas

yes it is rumoured that they have lowered or will lower? the gas price by 17%, that's after they have raised it about 80% over the last 1-2 years.....so not really a saving imo.............. h'mmm

edited to add- why do the british people have such short term memories....is it because they are thick ??

we are like a polulation of goldfish.

Edited March 3, 2007 by grumpy-old-man

[nomoney]

yes it is rumoured that they have lowered or will lower? the gas price by 17%, that's after they have raised it about 80% over the last 1-2 years.....so not really a saving imo.............. h'mmm

edited to add- why do the british people have such short term memories....is it because they are thick ??

we are like a polulation of goldfish.

Grumpy old man.

There are 3 types of people in British Society.

Type 1 : The Upper Class

These people live in Belgrave and Sloane square and wouldnt spit on you if you were on fire. They tell everyone what to do. they are never happy and never will be.

Type 2 : The Middle Class

This is the largest class of people because it is much broader than it used to be, it has amalgated the old working class as well as the old middle class. Middle class people keep up with the Jones, do as they are told. They are always consuming, because thats what the media tells them to do. They keep taking on more and more debt, because that what the banks tell them to do. They are the most unhappy in society.

Type 3 : The Lower Class

These people live in council houses and on benefits. They are workshy and have never had it better than under a Labour Governemnt. They dont consume because they lack the ability to purchase or obtain credit and on the whole they are happiest in society.

As long as the new middle class keeps consuming things will never change.

[Guest Charlie The Tramp]

BBC News 24

Petrol prices are on the way up.

Due to shortage of supply as Tesco and Morrisons withdraw the sale of unleaded petrol. When compensation is paid for the damaged engines this also will increase the cost at Tesco and Morrison`s filling stations.

You didn`t think they would pay this out from their profits did you ?

[nomoney]

BBC News 24

Petrol prices are on the way up.

Due to shortage of supply as Tesco and Morrisons withdraw the sale of unleaded petrol. When compensation is paid for the damaged engines this also will increase the cost at Tesco and Morrison`s filling stations.

You didn`t think they would pay this out from their profits did you ?

So they sell you duff petrol (Mixture of petrol and diesel) and that wrecks your car.

You make a claim for compensation and they pay it by putting up the prices at the pumps that causes the problem in the first place.

And we shop there why ?

Oh yes, I forgot they have put all the small traders out of business so you dont have much choice.

Bloomin Marvelous

[Guest grumpy-old-man]

So they sell you duff petrol (Mixture of petrol and diesel) and that wrecks your car.

You make a claim for compensation and they pay it by putting up the prices at the pumps that causes the problem in the first place.

And we shop there why ?

Oh yes, I forgot they have put all the small traders out of business so you dont have much choice.

Bloomin Marvelous

this unfortunatly, is the modern business world..... :angry:

no-one accepts responsibilty any more, the government don't enforce businesses to take responsibility, in fact the government are one of the main drivers of the rip off UK economy we all know & love to hate.

Edited March 3, 2007 by grumpy-old-man

[right_freds_dead]

the china panic:

they have borrowed to speculate on the always rising chinese stock market. only now the world is becoming swamped with debt AND chinese goods, they are spent out. no matter how many cheap 125cc mopeds a china company can make, there are only so many buyers.

being we are debted out and already now full of cheap 125cc mopeds. we wont buy as many as next year. the record rises in chinese production which the investors were lending money to speculate on will be much less from here on in.

panic stations...!!!

without all thet industrial input and enegy needed into china the mining and steel markets will be weaker:

panic stations !!

without all the fast high profits from all that trading the 'city bonuses' will be weaker.

panic stations !!

without all the trickle down city bonus money - the uk economy will slow down.

panic stations !!!

without a strong uk lending economy the house prices will fall heavily. btl cannot step in as the rents wont be cheap enough to get renters in.

panic for gordon brown. who will probably go for a VERY early election. july i say. then its too late to get rid of him for the next 4-5 years.

try calling an election in 2008 and its a no brainer.

this is ending./

[Sledgehead]

All the pieces are falling into place for Black Monday next week:

++ Sub Prime implosion in the US

++ Yen Carry trade starting to unwind

++ Global Stock markets on the verge of collapse

I thought this was the effect, not the cause???

++ Commodity prices taking it in the backside

And is that good or bad? Falls in maetals may be bad for the UK equities market, being full of miners, and it may signal lower growth, on the other hand, it also may spell lower inflation and that, with weakened markets will spell less pressure to rase interest rates. I can't see OOs and BTLers worrying about that combo! Far from it, they'll take the piss outta all the commodity bulls and stock bulls.

++ Irag

++ Afgahanistan

> 3 year old news. If you didn't buy that bit of bad news you sure have missed that buying op.

++ Iran

Perhaps, but that has been blowing hot and cold for a while, and the prop market could not care less.

++ Higher Energy costs

Hang on, you said commodity prices were "taking it in the backside". Meanwhile, energey costs for consumers are falling, which, unsurprisingly, they feel is good news. My point is, if you can argue it both ways, it ain't the real issue.

++ Bubble Property prices in the UK

So rising prop prices are bearish ....

++ Bubble property prices bursting in the US

... or perhaps its falling prices are bearish. I understand you are making a distinction between level and direction here, but direction is the effect and level was never a cause on its own. Neither get to the heart of things and neither fit in this list of causes.

++ Riot breaks out at a council meeting in the epicenter of the global property bubble (Camden).

Well, thanks for telling me but I knew nothing about this. Ooops, there you go, I've forgotten it already.

This is major bear food..

Are we really this famished?????

[Goldfinger]

Euro-bonds go up/interest down.

http://www.bloomberg.com/apps/news?pid=206...&refer=home

Quote:

``People are looking for the exit, but the exit is too narrow,'' said Andrew Milligan, head of global strategy at Standard Life Investment in Edinburgh. ``We do see this, eventually, as an opportunity to buy stocks and other risky assets as fundamentals remain positive. We just don't want to catch a falling knife at the moment.''

I suggest: Buy gold! If the bond-exit is too narrow, there still is the PM-exit. People will realize, possibly when it is too late and Isreal will already

be bombing Iran and oil sky-rocketing.

Quote:

``Bonds represent poor value at current yield,'' said Marc Ostwald, strategist at Insinger de Beaufort. ``People have gone flying into the so-called safety of bonds this week. There's an assumption that if the correction in stocks turns out to be more than storm in a teacup, central banks will cut rates. That's a poor assumption.''

Edited March 3, 2007 by goldfinger

[Daft Boy]

There is simply no way in hell that this SM crash is not going to spill over into the UK housing market. This is much more than just houses--its the bond market reacting to a massive debt crisis that is going to have global repercussions. A decade or more of speculative asset bubble building, houses chief among them, and we don't get a blow out? I do not think so.

I wouldn't be surprised if we don't see 500 off the FTSE Monday morning. This Baby's hot to pop!

And...the desperate thought that the money coming off stocks is headed in houses. Forget it. This is an asset meltdown and credit is going to get tighter than a Scotsman's wallet. With A grade bonds shaking in the US the only people who are going to get credit to buy houses after this shakeout will have to have a credit score in excess of 750 and be able to plonk down 30% or more on a house that has already lost 40% in the crash.

5 X, IO, subprime will soon be distant memories of a nightmare we all thought might never end.

RB I think you have crystal balls....this is the future IMO

[sam]

So now in total we have had

4 black Mondays

2 black Tuesdays

3 Black wednesdays

5 Black Thursdays

8 Black Fridays

[Pluto]

So now in total we have had

4 black Mondays

2 black Tuesdays

3 Black wednesdays

5 Black Thursdays

8 Black Fridays

.... and 10 yrs of rampant house price inflation. Enough is enough!

[Daft Boy]

So now in total we have had

4 black Mondays

2 black Tuesdays

3 Black wednesdays

5 Black Thursdays

8 Black Fridays

Beware the ides of March. Brown is the new black this season

[Guest Charlie The Tramp]

One thing that has upset traders over the past week are the huge losses some hedge funds have suffered thanks to the unwinding of the "carry trade", a huge investment merry-go-round ridden by speculators who borrow cheap in Japan, where interest rates are low, and reinvest the cash in countries where interest rates are much higher. The trade is estimated variously from $160bn by the Japanese to a round trillion by some traders

What A Week In The Markets

This simple but lucrative bet has started to come unstuck as the yen has become more expensive. The currency has rocketed against the dollar, euro, and sterling. Hedge funds not nimble enough to see this coming are undoubtedly nursing losses. It also seems unlikely that Tokyo will continue to serve so generously as lender of last resort to the global casino.

[Daft Boy]

What A Week In The Markets

and with the US on the brink of a recession next week will prove interesting for equities. The markets have not yet recovered from the huge losses of seven years ago. When they say stay in for the long term they must mean twenty years just to break even at this rate. Going down.

[pod]

4 black Mondays

2 black Tuesdays

3 Black wednesdays

5 Black Thursdays

8 Black Fridays

and a partridge in a pear tree...

[nomoney]

Just looked through the archive pages of the site and found this link

http://www.housepricecrash.co.uk/forum/ind...ck+market+crash

That was back in January. I remember reading this thread before I became a member and I told 2 of my friends, we all have shares. I sold mine at a profit, but after fees and such it will pay for the holiday in summer. KM did the same and has a bit more than me, but CB didnt he could get time off work to sort it all out. Just spoke to him and told him again about this website. Lets just say he will be having a drink this weekend, enough for every pound at a loss. He said he is going to just sit tight and wait for the price to go.

Cant help everyone they dont listen. This attitude will happen to millions of people when the house price crashes.

[Guest Shedfish]

..i wish i could find the article i was reading earlier... slipped back into the interweb - if i understood it right, one point it made was that unwinding a carry trade position itself strengthens the yen further (regardless of other factors), as yen are taken from the markets and given to the originator. so the speed of this when it starts to roll might take people by suprise.

that's scary, i thought.. bloomin obvious when you see it written down, but no less scary

[MarkG]

unwinding a carry trade position itself strengthens the yen further (regardless of other factors), as yen are taken from the markets and given to the originator. so the speed of this when it starts to roll might take people by suprise.

Indeed. If all the people who borrowed Yen are desperate to buy them in order to pay back their loans, then the value of the Yen is going to go way up... and since those Yen will then vanish into thin air as the loans are repaid, it will go even higher.

Western governments may well have to push interest rates to much higher levels in order to devalue the Yen to keep the 'game' going.

[muggle]

and a partridge in a pear tree...

Six flawed Fridays,

Five Troublesome Thursdays,

Four Wayward Wednesdays,

Three testing Tuesdays,

Two manic Mondays,

And a partidge in a pear tree!