US Debt Downgraded - Where Do We Open Monday??

Here, I'll make it simple for you, WBottom:

Charlie Munger: "Investing is where you find a few great companies and then sit on your ass."

And here are 2 Munger gems for SteveJHX:

(1) ”Most people are too fretful, they worry to much. Success means being very patient, but aggressive when it’s time.”

(2) ”Using [a stock’s] volatility as a measure of risk is nuts. Risk to us is 1) the risk of permanent loss of capital, or 2) the risk of inadequate return. Some great businesses have very volatile returns – for example, See’s [a candy company owned by Berkshire] usually loses money in two quarters of each year – and some terrible businesses can have steady results.”

"BRK.A as an investment over the past 13 years - 4% annual ROR

Gold $1,763 now.

Gold as a speculative trade over past 13 years - over 14% annual ROR"

Matson - try these #s on for size, buddy:

BRK.A as an investment over the past 30 years - over 20% annual ROR

GOLD as a speculative trade over the past 30 years - 5% annual ROR ($413 to $1764)

***Yawn***

Bsex, you've only been investing since 2007? I think you have a lot to learn: you missed the 1987 crash, and the dot.com crash, and started investing precisely at the worst time ever, 2007.

14.6% in 4 years is not a very good IRR.

Charlie Munger is right, bsex, but you don't seem to understand it. There is a time to be aggressive - IMHO (and I could be wrong) that time is not as all of the economic indicators are bad. Today's rally basically undid the losses after the debt downgrade, and would be fully expected given the sharp sell-off in stocks since the peak. If volume were high and if this weren't an options expiration week I might be impressed. But volumes aren't high and this is an options expiration week, so lots of people will be buying stocks so they don't lose money on their options. It's a known pattern.

The volatility of a particular stock's price is not the volatility of an entire market. Retail companies make losses all year long, then reverse the trend in the 4th quarter holiday season. This is a known pattern, as well. Utility stocks fluctuate with interest rates - another known pattern. But an entire market shifting 10% in a week is a sign of weakness, not strength.

I'm just happy to be in cash.

And yes - I am planning on buying some Florida rental property: the prices are great there, and you can make a 12% return on investment.

"is not as" = "is not now as"

Matson - BTW, according to Buffett's op-ed in the NY Times today, his 2010 taxable income was approximately $39,877,839. Virtually this entire amount was thrown off by Buffett's personal investment portfolio. How much did you earn from your investments last year?

"started investing precisely at the worst time ever, 2007"

Actually, October 1929 would have been "precisely the worst time ever". Who cares anyway? It's irrelevant.

"14.6% in 4 years is not a very good IRR"

Really, what's your IRR for the same period? I've outperformed the S&P 500 by 28% during that time frame. What have you done?

"There is a time to be aggressive"

Yes, it was in early 2009. If you missed that, sucks for you. I didn't.

"I'm just happy to be in cash"

You shouldn't be. GL.

"Actually, October 1929 would have been "precisely the worst time ever".

If you had been alive then, you'd have stuck your toe in, to be sure.

Last year I made about 30%. This year for realized profit I'm up about 5%, but it's not over. Like many I lost a significant amount of money in 2008 (for the first time in my life!), and I wasn't invested in 2009 because I didn't trust the market or my ability to navigate it.

I don't trust my ability to navigate this market, either, which is why I'm in cash. As I also said, my aim is to buy several foreclosed apartments in Ft. Lauderdale for cash - another reason not to be in the market. A 12% annual return on investment in Florida rental property is more than achievable, given the state of the market there.

The reason I don't want to be in the stock market today is because of my experience in 2008, when I thought - wrongly - that I could navigate the volatility. I couldn't: I invested in reverse mutual funds that didn't work as advertised: they all lost money, because of the volatility, regardless of the direction you bought.

At this point the market could go up 20% in a week, or fall 30% in a week, I just don't know. We're in a difficult phase where nothing is acting coherently. I look at last week like an extended Flash Crash. Events like that don't inspire confidence; retail money is fleeing the stock market; and up days have very low volumes despite the outsized gains.

It's not very awe-inspiring.

Here's one more reason why:

http://www.marketwatch.com/story/bank-of-america-wells-fargo-lead-financials-2011-08-15?link=MW_home_latest_news

BofA the best performing stock on the Dow?

It's not very awe-inspiring.

After NYC real estate dropped from peak (which was a very short-term peak) to its bottom (about 25%), steve said it was going to drop 50%. Prices have since come back up to probably around 20% from peak.

In steve's bizarro world, his 5-year old prediction that the market would crash was correct.

Insanity, incompetence and arrogance = stevejhx

"Last year I made about 30%. This year for realized profit I'm up about 5%, but it's not over. Like many I lost a significant amount of money in 2008 (for the first time in my life!), and I wasn't invested in 2009 because I didn't trust the market or my ability to navigate it."

I'm going to interpret this tortuous response as meaning that you haven't done better than my +14.6% return since October 2007.

"I don't trust my ability to navigate this market"

I don't try to "navigate" anything. I just buy stocks when they are cheap, based on fundamental due diligence. The future will never be clear - if you wait until it is before putting your $$$ to work, you will be waiting forever (and your cash will be constantly depreciating).

"It's not very awe-inspiring"

Is that what your are looking for in order to put money into the market, something "awe-inspiring"? Maybe you should look for something "cheap" instead.

"I'm going to interpret this tortuous response as meaning that you haven't done better than my +14.6%"

I wasn't the one bragging about my performance.

But "fundamental due diligence" on 3 stocks? Really?

No need to answer LICCdope, beyond saying that prices are still falling, and I don't live in Long Island City.

"I wasn't the one bragging about my performance"

No, you just said my performance was "not..very good". So I asked what your performance was, so we could compare.

"But "fundamental due diligence" on 3 stocks? Really?"

I own 3 stocks. I've done DD on 100s of companies - and I've picked the 3 best out of the 100s I've studied to own. Is that so hard to understand?

"So I asked what your performance was, so we could compare."

About the same. I consider it bad.

"Is that so hard to understand?"

It is from a risk-analysis perspective.

BS, you seem like a modestly smart guy - anyone who knows about portfolio analysis would strongly suggest that you find another 2 companies in different sectors that you can add to your portfolio. Hiding behind diligence of hundreds of companies, NONE of which meets the other 3 you own, sounds lazy or disingenuous. Additionally, since you state that you buy good stocks when they are cheap, you have to prepare for the point when any one of those 3 becomes fully valued and you need to sell, so you ought to be looking for alternatives.

"It is from a risk-analysis perspective"

So instead of putting $$$ into the best 3 investment ideas I have [i.e., the 3 investment ideas with the highest risk-adjusted return], I should put my $$$ into the worst 3? Or the median 3? Or just pick 3 at random? Or pick 10 at random? LOL - don't really follow that logic.

"I consider it bad."

If you consider beating the S&P 500 by 28% in aggregate over a 3.75-year period "bad", then I am forced to consider you clueless. (And what would be "good"???)

SteveJHX, the difference between you and me is that I know what I don't know (and you don't know what you don't know). I know that I can't predict short term stock market movements; I also know that you can't predict them either; however, you don't appear to know that you can't predict them (and that is/has been/will be your downfall as an investor).

"you have to prepare for the point when any one of those 3 becomes fully valued and you need to sell, so you ought to be looking for alternatives"

I always am, bro. That's what I do. I was reading Q2 10-Qs last night.

"BS, you seem like a modestly smart guy"

Actually, I'm not. That's the cool thing about Buffett's method - even a moron like me can make it work [not as well as Buffett, obviously, but to a decent extent] - you really don't need mega-savant intelligence, you just need common sense and a lot of effort.

Buffett is invested in more than 3 stocks.

>I always am, bro. That's what I do. I was reading Q2 10-Qs last night.

I doubt we are "bros"

"Buffett is invested in more than 3 stocks"

And?

BSexposer: And I've only been investing for 13 years, so that's all I care about. Of course, I'm up well over 100% in the past three years with gold, so your 14.6% in four years is uhhhh, well (*yawn*). Hold TIGHT to those 'investment' stocks!!!

Ignore at your peril:

http://www.marketwatch.com/story/the-bull-market-isnt-back-yet-2011-08-16?dist=beforebell

"into the best 3 investment ideas I have"

Take a course in risk analysis.

"you don't know what you don't know"

Words of wisdom from a guy who's been investing since 2007.

Aug. 16 (Bloomberg) -- Eleven days after lowering the credit rating on the U.S. for the first time, Standard & Poor’s is suffering a downgrade among global investors as American bonds are proving world beaters -- undermining S&P’s mathematical assumptions -- and prompting disbelief among political scientists months after the company upgraded China because of the stability fostered by Communist Party rule.

“The market has upgraded U.S. Treasuries,” said Andrew Johnson, the head of investment-grade fixed-income in Chicago at Neuberger Berman Fixed Income LLC, which oversees $85 billion. “Treasuries are still where people run to hide at least temporarily and that’s what we’ve seen over the past week.”

“It was really kind of bizarre that they’ve become political analysts,” said Thomas Mann, a congressional scholar at the Washington-based Brookings Institution. “I certainly never look to any of the three rating agencies as a source of expertise, knowledge or wisdom on the political system.”

http://www.businessweek.com/news/2011-08-15/s-p-downgraded-in-treasury-trade-after-upgrading-communist-china.html

bs--since you only hold 3 stocks at a time, and since youve only been investing for 3.75 years, pls be good enough to take the 10 seconds it would take to provide details.

Flmaozzzzz. I've got diapers older than 3.75 yrs. Ok. So punk bsexposer. Here's my read on your inability to move on the last week. No money to take advantage of one of the quickest dips in the mkt. A really good sell and re buy opportunity.

So who's the one caught sitting with their hands on their azz? Me, I was on my $40 k first class trip to Europe with my kids, cause I live based on my w_2 and not some ephemeral $100k /100% gain on some chkn scratch that I'll never be able to replicate.

So stfu and tell me how getting lucky on 3 stks post the greatest credit cycle implosion will allow you to do it again and again.

>Flmaozzzzz. I've got diapers older than 3.75 yrs. Ok

Does your son still poop in the bathtub when you bathe your daughter?

SteveJHX trying to give financial advice!!!
Bloody mary!!!! This is the same moron that shorted Gold at 700 and called it a weak play for years.
Missed the housing bottom in NYC in 08-09.
Missed the stock market bottom in 09.

What is this world coming to.....

Stevejhx and all you bears out there.

WHERE IS THE SUB 500 PER SQUARE FEET YOU PROMISED ME FOR UNITS IN LIC!!!! It's been almost 2+ years since you doorknobs made that promise. I'm still waiting.....

ericho75, be nice. At least steve has cats, a place on fire island, a career, some money, some pride, and a sense of humor. Compare that to columbiacounty who has the indignity of a window in his shower and no pride.

Damn kids, not so sure why you all are spewing so much hate on BSex here. I kinda like his move. Just wish he'd share what he's bought as I like his style and would research them for a potential purchase.

BSex, a question for you. Do you have more cash coming in every year to add to your positions, and at what percentage? I ask because I always like to keep some dry powder: as 2009 showed, just when you think prices can't get any cheaper, they do. Now personally, I'm fine with being fully-committed w/o any cash (I'm at 10% right now), but that's because I know I'll have 20-30% more cash come next year and am willing to go 10-20% on margin for some months should prices get attractive enough. Do you have any dry powder of any sort?

BSex has THREE stocks, totally contrary to all sensible portfolio creation, and you "kinda like his move"?

"bs--since you only hold 3 stocks at a time, and since youve only been investing for 3.75 years, pls be good enough to take the 10 seconds it would take to provide details."

Bottoms, while he's at it (even though he's already posted details on these companies), please be so kind as to post your "long-well-advertised position."

"No money to take advantage of one of the quickest dips in the mkt. A really good sell and re buy opportunity."

I'd love to see how many people sold off a meaningful chunk of their portfolio right before the flash-crash and then bought it all back within a matter of days. You'd have to be pretty confident in your ability to predict day-to-day stock movement. Or just really damn lucky. Heck of an "opportunity" there, huh?

"BSex, a question for you. Do you have more cash coming in every year to add to your positions, and at what percentage?"

Yes, I have a full-time job that has nothing to do with investing. When I build up a moderate cash position, I deploy it in the market. Also my current portfolio yields approximately 5%, so I also have this cash to use.

"since you only hold 3 stocks at a time, and since youve only been investing for 3.75 years, pls be good enough to take the 10 seconds it would take to provide details"

No, I am not going to specifically identify the 3 stocks I hold. If I did, all I would hear on here whenever 1 of them went down on a particular day is "BWAHAHAHAHAHA Loser" etc. Plus I don't think people should rely on others' "tips" to buy stocks - they should to their own DD before buying. And also I would feel obligated to disclose if I sold any / trimmed any / added any, etc., which I don't want to do. I gave the 3 industries (financials, oil/gas and autos), that's all I will disclose.

"BSex has THREE stocks, totally contrary to all sensible portfolio creation"

It's not contrary if you do in-depth DD on what you own. It would be much riskier to own 10 stocks about which I knew little than 3 stocks about which I understand virtually everthing. I put all my eggs in a small basket, but I watch that basket intently.

Face it, you need to find another two to three stocks, and the fact that you research hundreds but have found no additional stocks speaks to the quality of your analysis and stock picking more than it speaks to the quality of the stocks.

bs, if you can't understand the simple sense that diversification makes for stock picking, and if you profess not to care about current prices for your holdings, you are not particularly worthy of dialogue

stare at your lil basket, until something serious that you couldn't/didn't anticipate happens to one of your precious 3 stocks, then get back to me

and easy on the ego/dogma, given your mediocre 3.75 year track record--you are a textbook fool soon to be parted of your money

nada, BSex, amen. nada, I think much of this goes back to your views about perceived risk. As for dry powder, it's essential. You don't want to feel helpless when things are cheap - it'll drive you nuts if it keeps happening. And while I personally would not feel comfortable with a 3-stock portfolio, I can understand BSex doing the DD and accepting the risk/reward profile of such a portfolio. If you're willing to put in the work (as in, understand the companies' fundamentals rather than engage in technical "analysis" baloney), it can pay off, as it has with BSex. I prefer to stick to ~10 ETFs and dabble in a handful of companies. That's appropriately risky (I think) for someone who spends relatively little time doing research. Would obviously welcome others' thoughts as well.

You can't find a

tech
telecom
healthcare
general industrial
retail
food/beverage

among the "hundreds" of companies you've researched?

media and entertainment
utility

bjw, you are in no position to be supporting anyone. You didn't know the difference between the principal and interest in a mortgage. Pretty basic stuff.

BSexposer, I give you a hard time because your name here is quite arrogant - you are exposing BS? Really?

If you had a more smelly ass-like name, something like Wbottom, your points of view would be more consistent.

"shorted Gold"

Never happened. Never owned gold, long or short.

"the housing bottom"

What housing bottom?

"stock market bottom in 09"

Nope. Went long slightly before the bottom, rode it up to 11.500 on the Dow.

bsex has 3 stocks, and blowjb is still grayed out. Ah! Life is pleasant.

And WB is right - at an inflection point in the market you MUST be worried about prices: 80% of stock prices move with the market. Had you invested at the top of the dot.com boom, you'd still not have made your money back. Had you invested in gold right after it was dropped as the monetary standard, it would have taken you 40 years to make your money back.

There is not one economic indicator that implies things are getting better - Germany and France have ground to a halt. The US and China are right behind. Employment and housing are NOT getting better. Volatility is increasing.

To wit: we just got through the fastest 3-week drop in the last 48 years on the S&P. Last week was the highest volatility on the stock market EVER.

The 35% run-up in stocks in the past year was caused by the QEII bubble, which simultaneously wreaked havoc on the world's economies by causing an asset bubble precisely at a time when unemployment was high and no one could afford it. The single stupidest bit of monetary policy ever.

Jeez, people, why the anger? What I do with my $$$ has no impact on you at all - let it go. LOL.

Stevejhx thinks he's smarter than Ben Bernanke, that he can predict short term stock prices, that a stock chart is like a crystal ball which only he can peer into, that volatility equals risk, that China is not growing economically, that the sky is indeed falling, etc etc etc. It's quite amusing, really.

SteveJHX - do yourself a favor: turn off your computer, turn of the CNBC, go out into the real world where real people are living, working, saving, striving and trying to improve their lives and the lives of their children. It would do you some good.

"Had you invested at the top of the dot.com boom, you'd still not have made your money back. Had you invested in gold right after it was dropped as the monetary standard, it would have taken you 40 years to make your money back."

And if you'd actually read others' comments, you'd understand that BSex advocates buying when things are cheap. If that sounds like a no-brainer, that's because it is. Why you bring up buying at the absolute peak is beyond me.

And Bottoms, not that it really matters, but NWSA is now up over 16% MoM.

"advocates buying when things are cheap"

Yes, that's what value investing is all about. Price is what you pay, value is what you get. I'm a cheap bastard - I like buying dollar bills for forty cents.

Now, I have to go, folks - I will cease posting during the next year on this msg bd, as I've said all I have to say (and am starting to repeat myself) - during that time, all haters please direct your venom elsewhere, K? So long and GLTA.

Jeez, Bsex, why the anger?

HAHAHAHA!

I don't watch CNBC, though I do occasionally read the website.

Never said that I was smarter than Ben Bernake because I don't know him. However, I'm far from alone in my opinion.

Never said I can predict "short-term" stock prices, and never said that a "stock chart is like a crystal ball."

But here's the killer of your ignorance: "Stevejhx thinks ... that volatility equals risk."

Uhm, yes it does. In fact, it's the VERY DEFINITION of risk, because it is the measurement of how much a stock price changes over time: the more it changes, the higher the volatility, the greater the risk. That is basic Finance 101, and it is the foundation of options trading: the higher the volatility, the more expensive options get.

Just go here:

http://www.money-zine.com/Calculators/Investment-Calculators/Black-Scholes-Calculator/

change the volatility, and see what happens.

I'm sure you find it "amusing," but that's because you have NO CLUE what you're talking about.

"Volatility does not measure risk. Past volatility is not a measure of risk. It's nice math, but it's wrong. If a farm in Nebraska used to sell for $2,000 per acre, and now it sells for $600 per acre, investment theory would say that the beta of farms has gone up, and that they are more risky than before. If you tell that to people, they'll say that that's crazy. But farms don't trade daily the way stocks do. Since stock prices jiggle around, finance professors have translated that into these investment theories. It can be risky to be in some businesses. Risk is not knowing what you're doing. If you know who you're dealing with, and know the price you should pay, then you're not dealing with a lot of risk."

-Warren Buffett

i wouldnt buy news corp under any circumstance--i cant be a part of profiting from the filthy business perpetrated by rupert murdoch--but that's just me

Bottoms, not just a genius investor, but a holier-than-thou one as well. Well, if that's all you've got left after calling me a liar, congrats guy.

Have we gotten rid of bsex forever? Can we do this with blowjb?

Maybe in his time off he can read about VaR - and how volatility is used to measure risks.

Steve, he should definitely read this:

"Given the calamity that has since occurred, there has been a great deal of talk, even in quant circles, that this widespread institutional reliance on VaR was a terrible mistake. At the very least, the risks that VaR measured did not include the biggest risk of all: the possibility of a financial meltdown. “Risk modeling didn’t help as much as it should have,” says Aaron Brown, a former risk manager at Morgan Stanley who now works at AQR, a big quant-oriented hedge fund. A risk consultant named Marc Groz says, “VaR is a very limited tool.” David Einhorn, who founded Greenlight Capital, a prominent hedge fund, wrote not long ago that VaR was “relatively useless as a risk-management tool and potentially catastrophic when its use creates a false sense of security among senior managers and watchdogs. This is like an air bag that works all the time, except when you have a car accident.” Nassim Nicholas Taleb, the best-selling author of “The Black Swan,” has crusaded against VaR for more than a decade. He calls it, flatly, “a fraud.”"

http://www.nytimes.com/2009/01/04/magazine/04risk-t.html

Little old man Steve is foolishly wrong again, so he is lashing out at people, again.

The NYC real estate market didn't crash, Charlotte didn't become the US capital of finance, gold has been a good investment since steve said it wasn't, stocks have performed well when steve said they wouldn't, etc.

bj, what an idiotic cut/paste--given the source, not surprising
var does exactly what it professes to do--it does not profess to be be able to predict complete systemic meltdown, or sudden fat-tail increases in volatility
noone who understands risk would consider var alone in assessment of portfolio risk, but it is a very handy tool for assesssment of potential volatility based on historical

nice...gotta love the merkel-sarkozy "financial transaction tax"--can the two year we announce thurs come with a zero coupon? incredible

bj--please provide cut/paste that supports your agreement that a three stock portfolio is sunsible, for someone who studies real hard

also pls provide info on the superior risk model you espouse--i could use it--this market scares the shit outta me

there....stocks finally started to slip on the merkel sarkozy tax..

sorry steve...i engaged..the response should amuse a bit, nonetheless

Bottoms, so you agree with steve that volatility is "the very definition of risk," and disagree with Warren Buffett? The VaR piece was merely to point out to Steve some reading (as per his suggestion). Sorry it irked you so much.

"please provide cut/paste that supports your agreement that a three stock portfolio is sunsible"

Please provide a definition of the word "sunsible." And do yourself a favor, when you and Steve have that awkward first date, try not to talk so much about me. Sure, it's fun at first, but it's not much to base a relationship on.

WB - you did it again! You made me read blowjb!

VaR does, in fact, do what it claims to do by measuring statistical likelihoods. Is it 100% reliable? Yes, in terms of statistical probabilities. Though it could - were there enough data - it normally is not used to measure Black Swan events, such as the probability that you will marry your twin sister from whom you were separated at birth that you didn't even know you had. Is that possible? Yes, and it's even happened. It's also extremely improbable.

Volatility is the definition of risk in STOCK PRICES. It is not the definition of risk in owning a company. It's not the definition of risk crossing the street.

You really don't understand Warren Buffett - do you? - or the concept of Value Investing. PRICE IS KEY in value investing, although blowjb & bsex (similar names, eh?) deny it. You cannot perform due diligence in Value Investing without looking at the price. PRICE IS EVERYTHING.

Under most scenarios W.B. would not invest in a company that trades at 1000x earnings. He would one that trades at 4x earnings, provided that that discount implies VALUE. Why the latter and not the former? Because there is a risk of overpaying at 1000x earnings.

Had blowjb really understood W.B., he wouldn't have invested in a 2-bedroom apartment in the hinterlands of Brooklyn precisely at the peak of the market, locking in an unsustainable stream of capitalized rent. W.B. himself said that real estate was vastly overpriced at the time.

I mean really, WB, why do you engage this moron?

And yes - this market is scary, and the reason is its volatility.

"Volatility is the definition of risk in STOCK PRICES. It is not the definition of risk in owning a company."

Steve, you apparently don't even know what stock is. I'm sure you'll find a way to weasel your way out of this one, but yikes, what a gaffe.

"PRICE IS KEY in value investing, although ... deny it."

Really? We denied it? Please, show me where! This sums up your debate tactics nicely. Completely distort what others say so it sounds like they're arguing against common sense.

"he wouldn't have invested in a 2-bedroom apartment in the hinterlands of Brooklyn precisely at the peak of the market, locking in an unsustainable stream of capitalized rent"

Again, the tactics you resort to when you've got no legs to stand on. Classy, as always, Esteban.

Old man steve can't admit he is wrong and makes himself look even more foolish trying to obnoxiously talk his way out of it.

Typical steve.

LICCdope, adding his drachma again!

However wrong I might be, LICCdope, I DO NOT LIVE IN LONG ISLAND CITY!

Thankfully, blowjb is grayed out again.

But it does seem that blowjb thinks that his 5 shares of IBM means he owns the company.

HAHAHAHAHA!

drachma?? i thought LICDope was long gyrosdollars

LICCDope is long on tokens - nobody told him they don't take them anymore.

blowjb, and bsex (from what I can read) are trying to interpret Value Investing. Well, had the read the original book (which I did) they would see a) never invest in IPO's; and b) never invest when there is a new IPO or secondary offering every 20 minutes, as there have been recently - because both are surefire indications of a market bubble. Two other telltale signs are a) Stock buybacks (because they are almost without fail initiated when the market is at a peak); and b) M&A activity (because, well, ditto).

We've seen all of those by the bushelful since the start of QEII. Telling...

And the situation remains precarious - Dow up 100 points on increasing inflation (to be expected!), Europe's dead stop. All on pitifully low volume.

Oil back up to $90 a barrel, even though the world's economy is grinding to a halt.

I said there was a very good chance that this would happen. But the higher oil goes, the slower the economy gets. Right now all speculation, still QEII-based, no capitulation.

The longer this goes on, unfortunately the worse things are going to get. Echoes of 2008 and 2010.....

Steve, some perspective, with actual data:
http://blog.kissmetrics.com/tech-boom-or-bubble/?wide=1

"Well, had the read the original book (which I did)"

Your arrogance is hilarious. And misplaced.

Okay, now I'm not only really, really mad at you, steve; I'm really, really, really mad! These crickets you told me to invest in DIED.

They're best eaten ALIVE, lowery, followed by a swig of molten gold.

But how can something be an investment if you eat it? I don't understand your investment advice, Steve. Anyway, cheer up; it's not good to dwell on all this bad stuff going on. We are in a stagnant, nowhere place economically where people are hoarding wealth rather than growing wealth. Mellon Bank NY charging fees to accept huge deposits of cash is a symptom of this, but we know it's happening at all levels. No investment is going to earn you a big return until everyone else stops doing what you and Mellon's clients and I and everyone else is doing - hoarding.

"how can something be an investment if you eat it?"

Ask Jeffrey Dalhmer. (Yuck!)

The whole up-move was a bubble, QEII caused nothing but inflation. Completely backfired. Obviously the problem never was a lack of liquidity - because banks are charging you to deposit money with them. The problem was one of velocity: nobody was spending it.

Despite their denials, QEII is a decidedly monetarist, supply-side policy. Failed miserably, just like they all do. Now we see the downside.

And yes - I'm a Cash Guy now, at least till assets fall to a sustainable level.

Then you are part of the problem.

philly fed an unmitigated disaster -30.7

worst since the worst of the first dip in 09

if sitting in cash is a problem, it's a problem i like

double dip anyone?

Funny how urbandigs sold gold right bf new highs.

i sold 1/3 of my remaining position at 1770 or so. Im still in the trade. Whats funny is how much money I made in the trade. Thats funny. And you of course. Your funny. Your a funny guy. Like a clown.

Yes, lowery, HAPPILY I am!

Bottoms, this was predictable. Inflation running hot - core, schmore: people pay attention to food and energy prices.

Housing still dead. Unemployment getting worse. Europe ground to a halt. The market down 500 points on very heavy volume, in the first hour of trading. It will go up again, it will go down again, but after multiple 4%-5% interday swings in just over a week, the verdict is in: down.

The market could potentially recover all of its losses today, and then some. The problem is the volatility, and volatility like this only exists in a bear market.

Eddie Wilson...? Eddie Wilson...?

blwjob? Still right back where you were when you reinvested?

bsex - still unconcerned about stock prices?

Steve, the fundamental issue with your approach is how much attention you pay to daily stock movement. Here you are crowing about the fairly huge dip this morning. Of course, when things shoot up, you spin the conversation back around to volatility (or, sorry, is it "risk"?). If you're a day trader, these things are obviously hugely important factors. If not, well, they ultimately end up just being blips on the radar. Yeah, the run-up from '09 was fast. Crazy not to expect corrections. But you seem to think the economy's heading straight into the toilet for good. This is "harrowing" and "can't end well" and all that garbage.

If you're really curious, I'm still above when I put money back in, but I kind of hope things get very cheap so I can buy more.

UD, why pay attention to petrzitz under another name?

Anybody who claims to buy or sell at the exact perfect moment all times - somewherelse, aka Eddie Wilson, where are you...?! - is a liar. Trying to time like that is a dangerous game.

While usually the opening and closing prices are what matter, in times of extreme volatility what matters is the volatility itself. Volatility mostly occurs on the way down. Extreme volatility only occurs in bear markets.

"Bottoms, this was predictable."

I enjoy that you call him by his proper name.

"UD, why pay attention to petrzitz under another name?"

Highly doubt w67th is petr. petr did not have anything close to a sense of humor.

"Anybody who claims to buy or sell at the exact perfect moment all times - somewherelse, aka Eddie Wilson, where are you...?! - is a liar. Trying to time like that is a dangerous game."

I mean, yeah. But what do you mean "trying to time" is dangerous? That's essentially what everyone does.

"the fundamental issue with your approach is how much attention you pay to daily stock movement."

Wrong in most cases. Trends are what matter most, and even more is trend reversals. High volatility is a very serious indicator of bad things to happen. If you can think of a way to measure volatility WITHOUT looking at daily stock movements, post it.

"But you seem to think the economy's heading straight into the toilet for good."

Uhm, who said "for good"? Short- to medium-term, yes: virtually every indicator out there indicates it.

"That's essentially what everyone does."

You make no sense. You rail against looking at daily stock price movements, and then you say that everybody tries to time. You can't ignore the one and look at t'other.

Ain't possible.

"Trends are what matter most, and even more is trend reversals."

Disagree. Fundamentals are what matter most. If you just follow the crowds blindly, I don't think that's a recipe for success.

"High volatility is a very serious indicator of bad things to happen."

Not necessarily. Human emotion being what it is, people panic sometimes for irrational reasons. You can't tell me this doesn't happen in the stock market.

"Uhm, who said "for good"?"

You did! Specifically when you said "Harrowing. This cannot end well." Unless you have a different definition of the word "end."

"You rail against looking at daily stock price movements, and then you say that everybody tries to time. You can't ignore the one and look at t'other."

This makes no sense. Yes, looking at daily movements isn't particularly helpful/insightful. And yes, rational investors put their money in when they think things are cheap. That doesn't mean you follow the ticker like a foxhound; it means you're generally aware enough of when things are cheap. 's quite possible.

blwjob, that is a recipe for disaster.

No wonder you're grayed out.

I'm sure it's only a misapprehension, but, steve, you almost seem to revel in bad news.

lowery, no kidding.

Steve, you must be confused. I'm not grayed out. Bottoms is. And if you've grayed me out on your own, well, you're doing a pretty bang-up job of "ignoring" me.

"you almost seem to revel in bad news"

Sometimes. :+)

fundamentals mean nothing if price aint consistent, as is so often the case---all successful traders, asset managers are acutely aware of this--thus the concept that market prices are telling of something not yet understood in the fundamentals--the fundamentals on crispy creme were laughable--shorting crispy creme blew a lot of people up

and price and mark to market are the most important part of trading and money management--being right means nothing if youve been blown out of your positons

for every john paulson there are plenty of traders who are right, who have the fundamentals nailed, but who can't afford to carry their postions until the market correctly expresses the fundamentals

blowjob, you are a complete neophyte, who has little of value to add but your typical meaningless, random argumentative crap--trying to discuss anything of substance in an area in which i am in fact fairly successful, and knowledgable, is wasted engagement, ridiculous--you are a blathering fool, with waaaay too much time on your hands

lowery news is news---there is nothing inherently good or patriotic or emotionally healthy about jumping on the bubble bandwagon, and subscribing to bubblicious chatter--in fact not participating in bubbles may actually contibute to the greater good--and shorting markets, and succeeding at such, is the best regulation capitalism knows, as essential component--being short or uninvested in a bubble, and being right, is not a bad thing and is reasonable to derive pleasure from

having been leveraged long real estate and stock markets from the early 90's through 2007, i am quite capable of being happy when values go up--as a non believer in the strength of these markets since then i take pleasure when my pov is vindicated--and the jury is still out as to whether we get a severe double dip, but there is nothing "bad" about postioning to profit if we do--in fact it is good that there are believers and disbelievers and two-way markets--aint no capitalism without

Wow, bottoms, that was long and tedious. I fell asleep twice, but managed to slog though the quagmire of your deep "thoughts." We'll just have to agree to disagree on how important fundamentals are. I guess you invest based mostly on "trends" and chart-reading, like Steve then? Good luck with that. I don't do day-trading. All the money I put in equities is for the long-term. But keep doling out insults and generally being a jerk - it seems to do wonders for your self-confidence.

Fundamentals are very important - until they're not. And they don't matter during bubbles: they didn't matter during dot.com (or tod.moc, which is how it should have been known because everything was bass ackwards); they didn't matter in the housing boom (when home prices accelerated far beyond rents and incomes); and they didn't matter during the QEII bubble, when the world's economy was slowing to a grinding halt yet stocks & all other financial assets rose 35% in price.

That has been my argument all along, and why I kept my shorts despite the market: The FUNDAMENTALS did not support what was happening, and the fundamentals were all pointing to a crash.

The market is just catching up to that right now: without the Free Money Fed Will Save The Day attitude, the market has become unstable. Unstable as measured by volatility. Every one of the Fed's predictions was wrong, and materially wrong. I don't know why they bothered: had they just asked my mother the state of the economy in Florida, they would have known that a lot sooner.

In case you need a further indication of what is about to happen:

"Treasury sells TIPS with negative yield; bonds up"

http://www.marketwatch.com/story/treasury-sells-tips-with-negative-yield-bonds-up-2011-08-18?link=MW_latest_news

That I recall, last time there were negative bond yields was post-Lehman. I have said for months that all charts - yes, CHARTS! - were setting up like 2008. My personal faves were always oil and spot corn.

QEII was an utter failure. It's being unwound. It will take some time, but with banks now charging institutional investors to park their money, and treasuries having negative yields, September and October don't look too promising.

And there's little the Fed can do since they've already stoked inflation to 4%, and moving higher. This collapse MUST happen to set a secure footing for real, sustainable growth.

Telling in today's crash, as with every other down-day: HUGE VOLUME.

Okay. Everybody who thinks that today's 400+ point drop in the Dow signals an upcoming bull market, RAISE YOUR HANDS!

Yes, bottoms, you "do" so much and don't "blabber" at all, right? You know SE trolled you right?

Steve, I'm not in the business of predicting short-term stock market swings. But I do think we'll end up higher in the long run. That's not an earth-shaking revelation for most, but maybe for you it's shocking? Then again, you are the guy who said you made 2% a day, not to mention shorted the S&P last summer/fall.

interesting piece on a new company named grouponzi:
http://www.businessinsider.com/groupon-low-on-cash-2011-8?op=1

Why do they keep on deleting my "bjw is grayed out" comments?!

WB - you buying into that IPO? How's about ZippityDooDahCar?

>Why do they keep on deleting my "bjw is grayed out" comments?!

I can see them.

yes, this clown foretold the fact we would be deflating from the greatest re bubble for many years. That $500psf for C6 in prime NYC was coming. The fact the 2009 equity lows would be tested again. That we would be headed for a double dip. That unemployment will hit 10%. The recession was STRUCTURAL and would take many years to correct.

As a moral clown, I don't believe BORKERS deserve as a net benefit to society to "earn" $60K on a studio sale in 42nd and 12th ave.

I guess I have a very different view of a clown.... flmaoz

Today will be an interesting day - options expiration the day after a 400+ point fall in the Dow.

Park Avenue classic 6s for $800k-$900K? or $500 per sft. When does this happen? Timeline? 1yr? 2yrs? 5yrs? sometime in the next 20 yrs?

urbandigs, it's been happening "in the next twelve months" for about 4 years now.