9 Responses to “Bubblicious”

1. Axclr8
   August 10th, 2009 at 7:33 am

   

   Oh Lord, look at India’s chart! Has anyone seen the March 2000 crash and what ensued .. exactly the same pattern for India!

   But what really gets me is this:

   Krugman says world avoided second Great Depression

   http://finance.yahoo.com/news/Krugman-says-world-avoided-apf-980111695.html?x=0&sec=topStories&pos=4&asset=&ccode=

   Hummm … S&P PE 100+ and Growth Rate in the single digits .. sure, it’s a new bull market (AJC) … how and why people can make such great claims wihout looking at history? Arrgh!

   Bear Markets bottom with the PE touches 7 … there is going to be a lot of pain in 2010 and for the next 5 years after that .. the stupidity and arrogance of the human psyche is so predictible …

   Today, I am getting tons of spam from Newsletters regarding China / Asia investing … everything is positive and eveything is great … hummm .. the same newsletters were saying NOTHING at the best buying point in October and November … before the next 100%+ run up in Asian stocks …. it’s a shame and people get caught in it … I do believe after a decent correction that some Utility and Infrastructure stocks in Asia wil do good though … but the market is very frothy at the moment …

   For sure, this will be an interesting 4 months ahead …

2. Axclr8
   August 10th, 2009 at 7:44 am

   

   Nice link: National Debt Clocks and Savings Clocks …

   http://zfacts.com/p/461.html

   Sure … we’re recovering with holes in our pockets ..

3. jason bourne
   August 10th, 2009 at 9:06 am

   

   Mike,

   Try looking at Indonesian Stock Market (Jakarta Stock Exchange). Yahoo! Code: ^JKSE. It’s been up 100%+ since the bottom.

   Some of the blue chips are up for almost 10-fold gains. That’s blue-chip. Bank stocks are at their ALL TIME highs. One of the biggest conglomerates… profits down almost 40% this year, the stock is at its all time high. This is the country that got the worst hit in 1998 Asian crisis. Go figure.

4. jason bourne
   August 10th, 2009 at 9:13 am

   

   Well, well,

   the Keynesians, spear-headed by Krugman, now have come cheering out that Keynesian stupidity finally triumphs over the market. The recovery is here!

   If this Depression is to clean out excesses, it’s not just debt. More important, the idea behind it: Keynesian idiocy. Let’s hope by the time this Depression is over (it will surely be over somewhen!), the society finally puts this idiotic Keynesian economics to its grave, just as where Lord Keynes is now.

   Let the Keynesian clowns take the wrath of the whole society. Let Keynesianism be banished forever from my beloved world.

5. Aki_Izayoi
   August 10th, 2009 at 9:52 am

   

   “Bear Markets bottom with the PE touches 7 … there is going to be a lot of pain in 2010 and for the next 5 years after that .. the stupidity and arrogance of the human psyche is so predictible …”

   I guess I am the least bearish one here, but I think lower interest rates (so equities wouldn’t be heavily discounted relative to other things) and a more activist government would make the bottom near 10.

6. jason bourne
   August 10th, 2009 at 10:05 am

   

   How low the PE can go is also a function on the growth outlooks. Given that government is one of the most inefficient growth engine there is, logically PE should be lower.

   On the flip side, perhaps because of government stimuli & profligacies earnings don’t drop as much as if there weren’t any (Imagine how much in the negative S&P 500 earnings will be if the banks are to exercise mark-to-market accounting & no government handout). But that earning isn’t organic, which means “growth” is very inhibited (note the ” there — because it’s not really growth per se).

   From investment point of view, unhealthy, inorganic type of growth like this should be assigned lower PEs.

7. Mike
   August 10th, 2009 at 1:47 pm

   

   “Let the Keynesian clowns take the wrath of the whole society. Let Keynesianism be banished forever from my beloved world.”

   Hear, hear!

   Aki, to the extent that the government is more active, profits and growth will only be further retarded. I don’t see how this could result in a higher PE. But that is really neither here nor there, IMO — PE has more to do with social mood than fundamentals — although I would claim that a more activist government is often the result of and contributor to negative social mood.

8. Axclr8
   August 11th, 2009 at 4:05 pm

   

   Another Prechter interview today:

   Metal Mania: “Heavily Overbought” Gold & Silver Due for a Major Fall, Prechter Says

   “Gold has fallen sharply in recent days, but its supporters are undaunted: The yellow metal remains within earshot of its all-time high and is destined to soar as the dollar implodes, gold’s bulls say.
   As is often the case, Bob Precther, president of Elliott Wave International, takes the contrarian view, arguing there’s “too much optimism” about precious metals and negativity around the dollar.

   In fact, Prechter believes the dollar put in a major bottom last week and, as a result, foresees major weakness ahead for commodities generally, and gold and silver specifically. The precious metals are “heavily overbought” and the “path of least resistance” will be to the downside for many months, he says. “[Gold's] going to go much further [down] than people think.”

   Prechter predicts gold will follow silver’s path, which has put in a series of lower highs in recent months.

   “Even though people are one-sidedly bullish on precious metals, they’re not making any progress at all,” says the legendary market watcher. “I would not be loading up on gold at this point, you’ll get a better opportunity later
   ”

   One more …

   Bob Prechter “Quite Sure” Next Wave Down Will Be Bigger and March Lows Will Break

   http://finance.yahoo.com/tech-ticker/article/299205/Bob-Prechter-%22Quite-Sure%22-Next-Wave-Down-Will-Be-Bigger-and-March-Lows-Will-Break?tickers=%5EDJI,%5EGSPC,SPY,DIA,QQQQ,%5ERUT,BGZ&sec=topStories&pos=9&asset=&ccode=

   S&P PE of 7 - 10 … here we come in 2010 - 2015 …!

9. Axclr8
   August 11th, 2009 at 4:19 pm

   

   I still say we start the usual correction …. down 10% to 15% .. then get the bounce into Q1 … and then WHAMO!