You’re right. I wasn’t smart enough to listen to a “Financial Services Professional” like Scylla and lose:
Yep. I’m just a dumbass. Monday will be fun to watch.
::
Silo:
If by institutions you mean mutual funds (net liquidations no liquidity) pension plans, and insurance companies, than I fear you may be wrong.
The constant influx of 401k dollars may help.
Bonds don’t always suck. In 1991 my biggest position was Chrysler Auburn Hills floating rate bonds (I played with junk then.) I had like a 22% Yield to maturity, on bonds I purchased in the mid 70s. Sold them within a year around 118.
Today tech stocks suck. If you have MSFT CSCO INTC and such. Good for you. Your fine. If you are playing with RMBS BRCM NETA NPNT PCLN and such I think you are screwed. I personally love the fuel cell stocks here, and their tech. Check the charts on such boring companies as YUM TBC HNZ HSY and such and then tell me that there might not be a little change going on here in the secular bull market.
I think financials and utilities are good value down here too.
I am concerned that some of the perennial winners seriously violate support today, breaking through last tuesday’s intra-day lows. As such I’m diversifying and have been for the last 6 months.
You may be right about Japan. Certainly the situations aren’t the exact same, but there are some similarities. Draw from it what you will.
I’m 100% right about the liquidity though. My firm measures it for me. Discounting 401k dollars and foreign investors (the latter might not be fair) it’s just not there.
There’s gonna be a lot of margin calls monday, and that takes liquidity out of the market, as does the rising interest rate environment we may still be in (if Greenspan doesn’t recant.)
Institutional holdings are available on Bloomberg, and it’s frightening how little liquidity is actually there. Remember for the last couple of years these guys were in danger of losing their jobs if they weren’t returning 30-50%. They are fully invested.
Hedge funds may save us. I don’t know.
Oh. Tech stocks aren’t especially resistant to inflation contrary to popular belief. You may achieve that effect by cherry picking individual securities but as a whole you got to go with commodity based stocks to hedge yourself there.
Scylla, thanks for the statement on credentials. As you may know from seeing my profile, I do nothave any credentials in this area. OTOH, this is not necessarily a bad thing; I offer you the behavior of sell-side analysts in the past year or two as evidence.
Now, contrary to Silo’s assertions, I think that the fundamentals have changed somewhat:
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Microsoft has been guilty of anticompetitive practices. Regardless of MSFT’s innocence or guilt (that’s another thread), they’re going to get whacked, which will in turn ngatively impact the stock price.
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The Internut stocks are burning cash like there’s no tomorrow. CDNow, Peapod, and drkoop.com are all scheduled to run out of money by the end of the year (there may be others that I have not heard of), and the days when it was felt that an e-tailing company could just hit up a merchant banker for another billion-dollar loan, or sell a few tens of millions of shares in a SPO, are gone; too many companies have been to that well too many times.
So? Big tsimmis. That a good reason for the NASDAQ 100 index, and to a lesser degree, the Dow, to be down. You have COMPX futures? Mutuals designed to track the Dow or the S&P n00? If you did, too bad; I don’t, never did, and probably never will. You were planning on retiring next year? I’m sorry to hear that. May I suggest that it was bad planning to assume that, combined with bad porfolio allocations, that makes that impossible now?
Four years being too long a timeframe is exactly the way of thinking that the go-go '90s tried to impose on us. Yes; those days may well be over. So pull back your horns, prepare to settle for 10% a year instead of 50%, and think like an investor, instead of a speculator. MSFT and AMZN may be gone tomorrow; PCs and books will not.
“I don’t just want you to feel envy. I want you to suffer, I want you to bleed, I want you to die a little bit each day. And I want you to thank me for it.” – What “Let’s just be friends” really means
Not retiring. It’s just farther off now. I’m satisfied with my allocation just now, but show me somebody that didn’t get hurt thiw last week or so, and I’ll show you somebody that’s not invested.
It was easy to make money the last year or so. That’s changing.
Two weeks ago I’m up $1,500.00 This week I’m down $1,500
The next couple of weeks should be interesting. I hold a good sized chunk of Amex which is due to split 3-1 on the 24th. I’ll be curious to see what happens after the split.
I know the actual total dollar value of a stock doesn’t change when it splits, but the lower price makes it seem more attractive, right? (Obviously, I know jack shit about trading stock.)
Rysdad:
You got it. A stock split is just an accounting adjustment. It makes it easier for smaller investors to by round lots and gives the appearance of value.
Splits are very positive.
Scylla:
What do you make of This?
Looks like a primer on reits to me.
It also supports my contention that they offer mediocre return potential compared to their volatility.
In other words, as a whole, Reits suck.
The Asian markets just took a dump
Well, yes. Indeed. And it has ever been thus.
::dodges rotten vegetables, etc.::
Money–wealth–is a tool, and a symbol. It’s effort, sweat, hope, work and confidence bundled together with arcane rules and mysteries. (That’s why counterfeiting and 'net banking piracy scare me; they strike at the fragile core of economics.)
But to continue…fads, gluts and panics are nothing new–honestly. Read history, and interpret. Dizzying possiblities based on inventions, speculations on *whatever"–inventions, discoveries, water in deserts, precious minerals in land–are all part of the game. And the whole shebang is balanced by impulses to invest in buggy whips and coal mines.
Anybody who can’t see econmics as life (hope, aspirations, human sweat) in action just ain’t adjusting their corneas. The jargon and bullshit are offputting, but the essence is pure stuff of humankind.
(Thus my oft-regretted username.)
Just a mini-rant: ain’t much new under the sun, and glossy DYI dotcom investment ads ain’t much different from quaint ads for snake oil treatments and free land in OK.
Caveat emptor. Knowledge is power. The seller ain’t in business to make YOU rich. Don’t get into the game until you know the rules, the players and the stakes. Don’t bet more than you’re willing to lose. KNOW the game; be a smarter, more informed, tougher sumbitch than than any ad drone wants you to be.
There ain’t no free lunch and damned few breaks—and NO philanthropists in business. KNOW the arena and the league you’re playing in…and be ready to ride out the rough times.
Sorry, I’m ranting. But the dump in tech stocks was so predictable. The engaging “Stuart” Amertitrade ads et al were almost on a par w/ the Psychic Friends Network (IMO) in terms of pushing bunkum. The market (i.e. human effort, and confidence therein) is subject to fads, but the trick is to see past the hokum and jargon and ride out the hokum.
I, personally, still have silver certificates tucked under the mattress.
Veb
Well the market has been on the recovery just like I expected. I hope you all took my advice and bought good tech. stocks. If you didn’t now is still a wonderful oppertunity to buy in. Now that it appears that the market has completed its lower but double bottom, it is rebounding fast. More people are stepping in now that the market has come off its bottom. We have recently seen heavy downside volitility which has even surprised me. But the market is a two sided sword and I expect heavy upside volitility in the short term, so get your money locked in now if you haven’t done so. We are currently in the best corperate earnings enviornment the markets have ever seen.
-Mike
Two wrongs do not make a right…but three lefts do.
::Wake Up Dorothy Wake Up!!::
Whuh? Huh?
You mean it was all a dream?
Uncle Wally, You were There! Silo, You too, and Oh yes, that horrible Califboomer was there too.
Oh I’m so glad to be back.
THere’s no place like a Bull Market.
Not to spill the beans on my little secret but…
The conventional wisdom is that market timing doesn’t work, because the market is efficient, stock prices reflect all the relevant information already, bla, bla bla. To this I say phooey.
Near the end of March, when I saw the index fund I’m invested in (S&P 500) in my 401(k) account going through the roof, I got out (at 1523). Judging by the volatility lately, I figured there was a good chance it would drop back into the 1400s. Maybe 3%.
When it started dropping last week, I was going to get back in, but I got too busy. When I saw it was down again Thursday, I made the phone call to get back in that night, but it was not effective until close of business on Friday. So, procrastination paid off in this case.
So, I managed to splice a 166 point drop out of my return. Snip, snip, ca-ching.
Well, the market’s mostly back (for now, at least) but I thought it might be fun to share this little ditty making the rounds in the London markets. I give you “Humble Pie”, to be sung to the tune of Don McLean’s “American Pie”:
A long, long week ago
I can still remember how the market used to make me smile
What I’d do when I had the chance
Is get myself a cash advance
And add another tech stock to the pile.
But Alan Greenspan made me shiver
With every speech that he delivered
Bad news on the rate front
Still I’d take one more punt
I can’t remember if I cried
When I heard about the CPI
I lost my fortune and my pride
The day the NASDAQ died.
So bye-bye to my piece of the pie
Now I’m gettin’ calls for margin
'Cause my cash account’s dry
It’s just two weeks from a new all-time high
And now we’re right back where we were in July
We’re right back where we were in July.
Did you buy stocks you never heard of?
QCOM at 150 or above?
'Cos George Gilder told you so
Now do you believe in Home Depot?
Can Wal-Mart save your portfolio?
And can you teach me what’s a P/E ratio?
Well, I know that you were leveraged too
So you can’t just take a long-term view
Your broker shut you down
No more margin could be found.
I never worried on the whole way up
Buying dot-coms from the back of a pickup truck
But Friday I ran out of luck
It was the day the NASDAQ died.
I started singin’
Bye-bye to my piece of the pie
Now I’m gettin’ calls for margin
'Cause my cash account’s dry
It’s just two weeks from a new all-time high
And now we’re right back where we were in July
Yeah we’re right back where we were in July.
The stock drop that day was worth $1.7T dollars. Yep, T for Trillion. I guess thats how its written.
Anyone know why amazon.com has a P/E of ‘N/A’?
I hit it right on the button in my OP. THe market still sucks.
…but my tech stocks have done fantastic! 
Well, like the man said back in April, take a look at this:http://cnnfn.com/2000/06/12/investing/q_reits/