4 replies to this topic

[An Optimist]

It has been a long, long wait, but that final panic phase of the decline appears to be finally here. How low is low is difficult to say, but the SP500 should certainly go under 1,000 and the Dow under 9,000. I would be surprised to see the 2002 lows broken in any popular average.

[mannfm11]

They will break Gary.  We will see the 2002 lows this month, though we might get a little rally next week.  You really can''t call the losses we have had the past month a panic and from 10,300 to 9000 is a short bounce.  I would expect the 2002 lows to provide a bottom for this market short term, but this market is going below 6000 and probably below 4000 before we are all done.  I wouldn''t be surprised to see Robert Prechters EWP targets hit before we reach the bottom for several reasons, one being that the inflation debt bubble has broken and even though we might see substantial CPI inflation before we are done, we are going to see earnings collapse long term, dividends cut and a demand for dividends in the 6% range.  The dividends in themselves mean we drop 60%, but they will be cut significantly.  There would be buying support, but capital is being rapidly destroyed and money supply will begin to be consumed as well and those that like stocks will lose all their money before we hit bottom.

[bearking]

i keep looking for things to buy but there doesn''t seem to be much value out there. dividends, earnings & cash flows can''t be trusted when the economy is going into a downturn. it looks like everyone is jumping onto my ship and holding short term treasuries for safety. eventually when things bottom out, we may see a huge reversal of these cash flows.  I think if the Fed is able to create significantly higher inflation, money will flow back into commmodities - i don''t think they can ever reinflate housing.  So now I sit on the sidelines and wait.

The next bubble, btw, is Treasuries?

[bearking]

with market conditions as they are, it seems we should be below 800 for the S&P, IMHO.

[kdaddy]

I am looking for a short rally then adding all I have to shorting certain sectors (SRS for real estate).