Thread: Market Meltdown

Crisis, the chinese character includes both the fear and opportunity characters.

Buying opportunities abound..... just ask the chairman of BHP..... If you have cash it will be time to get in soon. Some blue chips are oversold IMHO. Those of us on DRP's will be laughing over the next couple of months as these companies are making just as much money as before the "crisis". Its a pity short selling was stopped......

Disclaimer, Ive been wrong before, this is not advice, if you dont know what you are doing STAY OUT OF THE MARKETS, you wont lose any money that way. Gra may be a banker but Im just a w@nker... hang on that didnt come out right....

No. Billions weren't wiped off anything. Most volume on a day to day basis is a finite group of day traders and a few fools thrown in for good measure. So someone sells 1% of a company at a discount and reporters extrapolate that to the whole worth of the stock. It's complete BS. It also explains why the australian market moves in step with the US. A small group of traders chasing each others A*'s trying to scratch out a profit. It has nothing to do with anything, but it makes good headlines.

Seriously. You've heard the saying don't believe what you see on telly, well you can just about assume the opposite is true. Pathological liars the lot of them. Anything for ratings...

Yep I'd be buying the big 4 banks right now, and flamin rio tinot at $95!!!!

Did you see Keating on Lateline last night.

He reckons the super funds should divert the equity money to the banks so they would not be so reliant on the wholesale money market to fund housing mortgages, makes sense to me a reliable 7-8% return is better than minus 12% for budding retirees.

What he did'nt explain is the impact that would have on the markets.

Interesting comment he made about ours banks needing to find $1bil each week from the wholesale markets!!!!!

Mike

Originally Posted by Sebastiaan56

Gra may be a banker but Im just a w@nker... hang on that didnt come out right....

Oi i am both thank you very much

Originally Posted by Sebastiaan56

Its a pity short selling was stopped......

Except that short selling drives the value of companies down just so some greedy mob in stock exchanges can make a quick buck.

Originally Posted by Waldo

Except that short selling drives the value of companies down just so some greedy mob in stock exchanges can make a quick buck.

Only those companies that are weak and where there is a case that the price needs to be lower. By removing short selling there will be a reluctance to sell and companies that are overvalued will effectively be ripping off their shareholders. If the value of a share is a multiple of future earnings and the price doesnt reflect those earnings then the price needs to move, up or down. There are few nowadays with the financial power to force the direction on individual stocks. Long or short every share purchase is a bet on the future.

Warren Buffet is buying up big at the moment, Lehmanns and now GE.

The justifications espoused by short sellers are a wonder to behold. Coming from a former short, let me say that the usual goal is to leverage sentiment downwards, that is to move the market lower by artificial means. Its all crap, and does nothing to create wealth nor is it an accurate reflection of the market's opinion of a particular company.

The other thing that it does is enable cynics like me to leverage pessimism in a bear market...the only bet that I normally make, although I make it too often for a market awash in cash (Last year's market I'm talking about)

I don't think short selling is helpful in real terms, especially naked shorts or borrowed share shorting. (Who the hell came up with that one? Lending shares to someone who then go his hardest to lower the value?)

Also: Buffet bought Goldman,Sachs not Lehman Bros which has failed. GE a a 12 X multiple does not look too cool until you read the terms of Buffet's investment. The kinda terms he can dictate could make a guy rich!

In times like these you have more upside trading index futures, surfing the volatility. Be more afraid than greedy and you could do OK.

Originally Posted by gregoryq

The justifications espoused by short sellers are a wonder to behold. Coming from a former short, let me say that the usual goal is to leverage sentiment downwards, that is to move the market lower by artificial means. Its all crap, and does nothing to create wealth nor is it an accurate reflection of the market's opinion of a particular company.

There cant be unlimited upside on any company, commodity, index, whatever for that matter. Going perpetually long also creates no wealth, just inflation.

The other thing that it does is enable cynics like me to leverage pessimism in a bear market...the only bet that I normally make, although I make it too often for a market awash in cash (Last year's market I'm talking about)

Blind Freddie could have seen it coming..... Blaming shorts is purely political, bashing the "bad" guys who are willing to stick good money saying that the situation is going to change. My experience is that shorting is more risky and therefore more profitable if you get it right.

I don't think short selling is helpful in real terms, especially naked shorts or borrowed share shorting. (Who the hell came up with that one? Lending shares to someone who then go his hardest to lower the value?)

My argument here is that there may be a few institutions who can really move a market but little Joe's like me cant. If the prevailing opinion is that a share or commodity is overvalued (eg poor results are announced) there needs to be a mechanism to allow the price to go down. Not many will take a bath on a trade unless really they have to. If there is extra yield to be had for the owner of the share then thats fair enough. But naked shorting is too risky for me.

Also: Buffet bought Goldman,Sachs not Lehman Bros which has failed. GE a a 12 X multiple does not look too cool until you read the terms of Buffet's investment. The kinda terms he can dictate could make a guy rich!

In times like these you have more upside trading index futures, surfing the volatility. Be more afraid than greedy and you could do OK.

Of course, I stand corrected. My point is that Warren Buffet sees opportunity and yes he has the leverage to get a good deal and yes he has the cash to grab the bargains as they emerge. I think there is a lot of upside out there.

The only problem with indexes is that I dont want to get up five times a night...., my personal preference nowadays is to read the company reports and check the results. And when I get in, wrap calls and puts around them.

OK ah hem bankers, why have short term interest rates dropped 32 points since last week?

Originally Posted by Sebastiaan56

There cant be unlimited upside on any company, commodity, index, whatever for that matter. Going perpetually long also creates no wealth, just inflation. . Blaming shorts is purely political,

Not purely. I've a nifty little energy stock that can't get a footing because the short sellers hold it down. Good company results and good prospects, but it's small and the shorts bounce it like a rubber ball.

Originally Posted by Sebastiaan56

My argument here is that there may be a few institutions who can really move a market but little Joe's like me cant.

Ever heard of a hedge fund, that seems to be their main business model at the moment. Short sell and drive the stock further down, so short sell some more into a spiral. You are right little joes like you cant move the market, but a multi billion dollar hedge fund can AND WILL