29 Sep 08
1 edit
Originally posted by no1marauderI am in agreement 100%. What people are failing to see is this is the a free market works! Money is wagered against risk. People are just afraid to see the ugly side and the truth that a stocks price isn't an absoulute.rec'ed to you no1
If you invest in something as volatile in the short term as the stock market when you need money quickly, you are taking a risk. Most people with the type of assets and debt you are talking about, have diversified portfolios. If they don't, they made an error. I bet $50 on the Yankees to finish ahead of the Red Sox; when I lost I didn't cry for the gover ...[text shortened]... ail me out. People who have a fair amount of assets and made bad bets will have to suck it up.
As I understand it, the sell off we saw on wall street today (and over the last few weeks) is really just the tip of the iceberg in terms of an indicator as to just how bad things have gotten. It sounds to me like the credit markets tell the real story, and since we don't have a nice number system to gauge their health like we do the NYSE (for instance) the depth of this problem goes well beyond what the average "man on the street" currently realizes. Thank God for small favors, I guess.
Particularly troubling, again as I understand it, is the plight of the commercial paper market. Now, I'm sure many people understand this concept far better than I do (the whole thing seems rather egg-headish), but for the last week or so this credit market has been all but dried up, and this is where many many US companies get their short term cash. In fact, it is possible that if this particular credit market stays in lock down mode for any significant length of time we are going to start seeing companies ceasing production, unable to get paychecks to employees on time, layoffs, etc. At which point we are going to start seeing sell offs and runs on the banks at unprecedented levels.
Hold on, it could be a wild ride.
30 Sep 08
Originally posted by uzlessOh next week I'm dumping as mruch money as I can get my hands on into the market. There are fortunes to be made.
This only helps long term investors. Try thinking about the people that have to take money out NOW ffs. Debt obligations, mortgage downpayments, mandatory RRSP conversion to RRIF's. Refinancing on your mortgage because your term is up. Actuary adjustment due to mandatory evaluations for pension funds.
It's all fine and dandy if you dont' have to do an ...[text shortened]... t just because you aren't affected it doesn't mean millions worldwide aren't you airhead.
30 Sep 08
How absolutely lovely. I'm gonna be riding a king-sized schadenfreude high for days on end.
Lemme put it this way: when you've made billions of dollars by producing nothing, using other people's money, passing around what amounts to an 80-kiloton hot potato, you don't exactly get any sympathy from the average joe when the record stops.
This particular average joe, for example, thinks it's funny as hell.
30 Sep 08
Originally posted by no1marauderdiversified where?
If you invest in something as volatile in the short term as the stock market when you need money quickly, you are taking a risk. Most people with the type of assets and debt you are talking about, have diversified portfolios. If they don't, they made an error. I bet $50 on the Yankees to finish ahead of the Red Sox; when I lost I didn't cry for the gover ...[text shortened]... ail me out. People who have a fair amount of assets and made bad bets will have to suck it up.
Show me a major stock market that didn't drop yesterday.
30 Sep 08
1 edit
Originally posted by TheSkipperBang on Skipper.
As I understand it, the sell off we saw on wall street today (and over the last few weeks) is really just the tip of the iceberg in terms of an indicator as to just how bad things have gotten. It sounds to me like the credit markets tell the real story, and since we don't have a nice number system to gauge their health like we do the NYSE (for instance) ell offs and runs on the banks at unprecedented levels.
Hold on, it could be a wild ride.
This is also affecting companies that didn't make any bad investments. The credit market right now is the bigger problem and the bailout package was designed to help alleviate it. Not many people get that as you can see by the posts presented. Most still think this only affects individuals that bought risky investments. The banks are hoarding money from each other, the bank-to-bank lending rate is through the roof at the moment.
Sure glad my mortgage isn't due any time soon.
30 Sep 08
1 edit
Originally posted by sasquatch672lot of truth to that sasquatch...however, everything i've read says the recovery will take about 2-3 years. As long as your investment time frame is beyond that you'll be good to go.
Oh next week I'm dumping as mruch money as I can get my hands on into the market. There are fortunes to be made.
Originally posted by uzlessIf the idea is recapitalize the money market, as I think it should be, I don't see why there's the need to buy these toxic assets. There are better ways to do this, ways that have worked successfully in the past (such as in the Scandinavian banking crisis).
Bang on Skipper.
This is affecting companies that didn't make any bad investments. The credit market right now is the bigger problem and the bailout package was designed to help alleviate it. Not many people get that as you can see by the posts presented. Most still think this only affects individuals that bought risky investments. The banks are hoard ...[text shortened]... ding rate is through the roof at the moment.
Sure glad my mortgage isn't due any time soon.
The alternative to this bail-out is not just sitting on our hands.
30 Sep 08
Originally posted by WulebgrThere's a crisis right now, but that doesn't mean that capitalism is obsolete, in the 1930s there was a crisis, but we eventually recovered.
Because capitalism is destroying itself. That should have been clear and obvious to all.
So, no, capitalism isn't destroying itself.
and before some commie says anything, No, communism is not the answer
😞
30 Sep 08
Originally posted by generalissimoexactly...regulated markets are the answer.
There's a crisis right now, but that doesn't mean that capitalism is obsolete, in the 1930s there was a crisis, but we eventually recovered.
So, no, capitalism isn't destroying itself.
and before some commie says anything, No, communism is not the answer
😞
Almost every financial crisis in the world has been precipitated by de-regulation. You have a boom that gets outta control followed by a huge bust.
We gotta learn from these things.
30 Sep 08
Originally posted by uzlessWell, yeah. The American people are just really angry that they are expected to "bailout" these "Wall Street fat cats" for their bad/greedy investment/lending strategies. I'm actually very sympathetic to those feelings, but as kmax explained in a nother thread it really is a situation of cutting off one's nose to spite one's face.
Bang on Skipper.
This is also affecting companies that didn't make any bad investments. The credit market right now is the bigger problem and the bailout package was designed to help alleviate it. Not many people get that as you can see by the posts presented. Most still think this only affects individuals that bought risky investments. The banks are ...[text shortened]... ding rate is through the roof at the moment.
Sure glad my mortgage isn't due any time soon.
I'm not opposed to Palynka's (sp?) idea of recapitalizing the financial markets thereby keeping the American people from having to invest in risky mortgage back securities, but I would want to see the specific proposal first. Wall Street has proven in the last couple of years that it is not nearly as capable of planning for a "rainy day" as we all would have liked, and I can see them using the new capital, stuffing their bad loans in a closet, and then running into the same brick wall a year or two down the road. Obviously we would need some major regulation.
Looking forward I'm starting to think we need to 'tweak' capitalism a little bit. I'm not sure how to do it, of course, but it seems the motivations are all worng if the desired outcome is longterm economic growth.
CEO's aren't paid millions upon millions of dollas to make their respective companies/clients 8-10 percent a year, they are paid to rake in the absolute highest profits they possibly can. These people aren't expected to keep the company solvent for 50 years, they just need to make as much money as possible for as long as possible. This is obviously not a sustainable way to do business, and consequently we will continue to have these 'days of reckoning' until something is changed.
More regulation is all I can think of at the moment, but even that idea isn't perfect since investors tend to over react at the mere mention of the word 'regulation' and we risk sending the economy into a tailspin at worst and a period of sluggish growth at best.
Sheesh...I don't know...buy gold.