Tuesday, July 31, 2007

Stocks open up on earnings view

OK, I was wrong! There is one final rally left before the crash!

I really thought the assets markets were ready to topple last week, but it now looks as though they are gearing up for one final rally before succumbing to the inevitable. Hats off to s2r1. The accurate timing of his prediction is uncanny.

Posted by royston @ 02:49 PM (94 views)
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12 thoughts on “Stocks open up on earnings view

  • Until we see some serious profit warnings from lots of different companies in different sectors I doubt that the stock markets will “crash”

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  • I’m going to quote from BBC Robert Prestons blog here becasue, whilst I don’t know that much about stock markets, I reckon this makes sense:

    “There’s a sizeable premium in the stock-market stemming from the belief that every company is vulnerable to a private-equity takeover…

    …we aren’t going to see any big new private-equity deals for a while, at least until debt markets regain their nerve and poise.

    Which means that the share prices of companies thought to be vulnerable to a private-equity takeover are too high – and that in turn probably means that the stock-market as a whole may be set for some dismal days.”

    I think TS will HTF very shortly.

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  • Royston,
    where else are they going to invest the money if they withdraw it from the stockmarket???

    If M4 is 14% YOY, the stock market is very undervalued…!!!

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  • Given that you lot are into your Kondratieff, I’m surprised no-one around here has mentioned the Elliott wave analysis point of view. They concentrate on financial markets but the principles apply to all liquid asset markets.

    It may interest you to know that they assert that recession in global asset markets began in 2000 in real terms (the Dow has since halved against gold) and that global depression will follow on its heels. They predict the next leg down as imminent (last week was probably the start) and that it will be life-changing in magnitude (and not in a good way).

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  • Why the prediction of a stock market crash?

    Companies are reporting excellent profits. Sure some that are sensitive to interest rates might expect reduced profits but on the whole the markets are quite strong.

    Also not sure that a stock market crash will be all that good for property price crash as poor returns in the stock market will incourage people into property as an investment.

    Be careful for what you wish for.

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  • Royston,

    You will never get it right all of the time (nobody does, like you I thought this is it). heh, we have to admit it and move on.

    If Roger Bootle of Capital Economics calls it in 2005, then yes, they can see it, the but is how long will it take the sheeple to catch on. They obviously see it coming much faster than most.

    s2r1 your insights to the latest rally will be much appreciated, for me it defies all logic.

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  • Jim Thallis said “Be careful for what you wish for”.

    I don’t think it’s a case of wishing. I think generally users here know that an almighty correction in all manner of asset prices, investments etc is coming. We don’t particularly want it to happen and we don’t want it to be so huge it makes the 1929 Crash look like a walk in the park but we feel it is envitable.

    The global financial system has been played very fast and very loose for a very long time and it simply can’t go on indefinitely. Not a wish, just my belief.

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  • There is no bubble in the stock markets. Stocks, especially in the FTSE 100 are undervalued. People on this site are calling a top to the property market because it is historically overvalued. I agree with this verdict since it is backed up by the figures. Shares are historically cheap. At an average P/E of about 12 for the FTSE 100, even though some of this may be due to companies being seen as takeover targets, no sensible investor can claim there is a bubble. Shares are not just cheap, they are really cheap. Stock markets regularly fall 10% and resume their climb. Market psychology makes this a necessity. I am going to take all my cash savings and buy shares now. I am a long term investor so the current dip is great news for me, even though my current shares have gone down.

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  • As I said in a previous post the markets are wobling at the moment, they have gone down they will go up – my guess tomorrow is that they will loose the gains they made today, and possiblyeven more – I see a close just under the 6200 with FTSE 100. I also see that they will climb steeply again late August and we will see them approach the magical 7000 barrier before plumitting to under 5500 as the crunch really starts to take hold.

    The next six months is going to see the Wobble in both the housing and stock market sector – the crash is not going to happen until 1st Qtr 2008

    this is just my views though.. we will have to wait and see 🙂

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  • sold 2 rent 1 says:

    Interesting points guys.

    There is some big volatility at the moment.
    All my put options are geared for a 20% drop from peak on the S&P to around 1240 before December.
    After this the market may rise like it did in 1929-1930 and pull in the suckers.

    If I get this prediction correct then I am piling into various forms of gold bigtime.

    I have been following a few financial pundit’s websites.
    Timing is incredibly difficult when shorting stocks.
    I have never done this before and will never do it again.
    This is a once only deal for me – despite the paper profits I am not enjoying it
    I am an IT techie by trade.

    Even well respected pundits are struggling with the stocks sell-off timimg
    Expect a few more surprises along the way

    I hate trading and most of my research is about when to buy gold
    Once this point in time happens I can relax again (a little anyway)

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  • Stocks set to open way down today – wiping any gains made yesterday. Volatile conditions set to continue……

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  • also sold to rent says:

    I don’t really see an uber crash coming, nothing worse than 2000-2003. The last bear market was one reason why retail investors jumped into BTL, so if housing and equities go down at the same time then everyone will perhaps pile into either bonds or commodities. The latter preferably.

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