November 12, 2008

S&A Quote of the Day


"There just doesn't appear to be an end in sight to the bad news. The selling is relentless."

- Anton Schutz, portfolio manager of the Burnham Financial Industries Fund, November 12, 2008

(smells more and more like Despondency every day... Get a good whiff everyone)

43 comments:

JaneZ said...

This is the only way that Republicans have left to redeem themselves:

http://tinyurl.com/6g6rp3

Boehner Demands Fed Identify Recipients of Loans (Update1)

By Laura Litvan

Nov. 12 (Bloomberg) -- House Republican leader John Boehner called for the Federal Reserve to disclose the recipients of almost $2 trillion of emergency loans from American taxpayers and the troubled assets the central bank is accepting as collateral.

Anonymous said...

This is capitulation. Despondency is near Dow - 6000, S&P - 600 and Nasdaq - 1000.

JaneZ said...

Woo hoo more heloc, more granite, more hummers. God bless Uncle Sugar Paulson.

http://tinyurl.com/5tzwr4

Why Treasury Is Revamping $700 Billion Bailout Fund

The Treasury is revamping how it uses the $700 billion financial bailout fund, focusing on on relatively healthy consumer debt rather than the toxic mortgages that triggered the credit crisis in the first place.

As Treasury Secretary Henry Paulson acknowleged during a news conference on Wednesday, the initial decision to buy troubled mortgage assets of financial institutions was "not the most effective way" to use the $700 billion bailout package.

Instead, the Treasury will now use the money to buy securities backed by credit card debt, student loans, auto loans, housing and government agency debt. The intent is to help unfreeze those markets, where interest rates have soared and consumers often are unable to get credit for purchases.....

Anonymous said...

This is for sure Hedge Fund selling. Must have received plenty redemption calls from investors before the last due date of 15th Nov.

Anonymous said...

Were still in panic!

Paul E. Math said...

Looks like I sold early. As I may have mentioned, I have been buying SCC after a big ris in the market and selling on large declines as a way to capitalize on volatility. I sold this morning at 156 only to watch it rise to 165.

Then I bought some WTI at 14.95 as a way of playing the upside of oil price volatility only to watch it fall to 14.10. I'll probably be proven wrong, but I don't think OPEC is that powerless - they'll cut production (or say they will) or stir up international trouble to cause oil prices to rise at some point in the next month or so.

Am I an idiot? Probably. But jeezes, gambling is addictive.

Anonymous said...

NO Still Panic....end of next year will be despondence at about DOW 3800

k.w. - Southern Ca. said...

This is just the beginning, it get's much, much worse.

Working in healthcare, things are still going pretty much as usual, but even this field is not depression proof - and that's exactly where we are headed.

As the economy plummets, our political leaders (who we pay) are still spending money recklessly in order to bail-out buddies and to "maintain the status que" of entitlement programs.

Keep those printing presses humming ... while the US curreny falls below the toilet and into the sewer.

k.w. - Southern Ca. said...

What a joke, what bullox.

Transparancy should have been put in place *before* one dollar of tax-payer's money went to any of these wall-street and banker crooks.

The damage is done - the money isn't coming back - much more will be lost - housing will not be saved.

JaneZ said...
This is the only way that Republicans have left to redeem themselves:

http://tinyurl.com/6g6rp3

Boehner Demands Fed Identify Recipients of Loans (Update1)

By Laura Litvan

Nov. 12 (Bloomberg) -- House Republican leader John Boehner called for the Federal Reserve to disclose the recipients of almost $2 trillion of emergency loans from American taxpayers and the troubled assets the central bank is accepting as collateral.

k.w. - Southern Ca. said...

You'll consider yourself smart as more, and more losses pile up.

Wallstreet is toast, and we should do away with this system - or any system - which proclaims to offer methods of making easy money.

Making easy money is what got us into this problem, and housing is just a symptom - not the cause - of the greed-driven system we unfortunately find outselves living/surviving in these days.

Paul E. Math said...
Looks like I sold early. As I may have mentioned, I have been buying SCC after a big ris in the market and selling on large declines as a way to capitalize on volatility. I sold this morning at 156 only to watch it rise to 165.

Then I bought some WTI at 14.95 as a way of playing the upside of oil price volatility only to watch it fall to 14.10. I'll probably be proven wrong, but I don't think OPEC is that powerless - they'll cut production (or say they will) or stir up international trouble to cause oil prices to rise at some point in the next month or so.

Am I an idiot? Probably. But jeezes, gambling is addictive.

vanilla ice said...

Disponcency: depression of spirits from loss of courage or hope

Yes, Mr. Schutz is despondent and a smart guy. But what about the rest of the delusional Wall Street managers? They say all the sellers don't know what they are doing, now's a great time to buy :](where have we heard that before?), and the bailouts will work.

What about the rest of the US of Apportionments? Not all, but many believe in the bailouts like they were god's spoken word. They believe it will work. And people are in denial about how much their property values have declined. They believe in not addressing the fundamentals, but want to be saved from themselves now. They think this is some passing flu.

The average American is still between denial and panic.

Lady Di said...

It looks like we're headed towards a capitulation replay of last month. The recession data is taking over where the credit crisis left off.

Time to buy more popcorn (and DXD).

DOPES 2 said...

TOOLS,

WE ARE IN PANIC RIGHT NOW!!!!

EVERYDAY COMPANIES ARE RELEASING LOWER EXPECTATIONS, NEEDING BAILOUT CASH, ETC.!!!!

DOW DOWN TO 5000 THEN DESONDENCY!!!!

TOOLS!!!!

DOLTS!!!!

DOPES!!!!

derivs said...

Crazy but I still see a ton of Denial mixing with Fear.

Derivs said...

Paul E Math... OPEC will cheat like they did in the good old days. When things are good it's easy to be a cartel.. In bad times-Every man for himself.

I remember buying $11 barrels in '98 all to well.

Anonymous said...

1-20-09: THE END OF AN ERROR,

GEORGE W. BUSHCO.

Censure and remove today before WW4is begun for one more Halliburton no-bid Cheneyburton contract rip off.

queso-dilla said...

Capitulation is arriving for sure:
The talking heads on CNBC are almost all bearish and giving up on the chearleading. They expect things to go lower and be slow to recover. About half of the guests are still chearleadesr, but thats probably an equal time thing.
Despondency after the 1st hundred days are over and there is still no sign of a turn around. That's the buying opportunity. DOW 6500, S&P 650. Brutal volatility along the way.

G Money said...

This is, of course, happening because of housing... HP'ers know that.

I think that Keith ended HousingPanic way too early, but that's my opinion. This is the PANIC stage...

Ok. Here it is. How to turn around this entire economy...

1. All Mortgage Interest Rates need to be 5% across the board. Everyone and I mean everyone who is a homedebtor in the country receives an interest rate of 5%, no matter if they are underwater, getting foreclosed on or is in excellent standing. EVERY HOME DEBTOR IN THE COUNTRY GETS A 5% INTEREST RATE ON THEIR MORTGAGE.

2. All People willing and able to buy a home, gets a Mortgage Rate of 4%. EVERY ONE THAT IS APPROVED GETS FINANCED AT 4%.

That's pretty much it. I am sure their should be a lot more regulation to it and a few more stipulations, but that will just mess things up.

Once this is done, prices will stabilize and eventually go up.

Consumer Sentiment will go up. People will be able to sell their homes and then purchase another one at the 4% interest rate. Renters will want to buy, also.

Chicago Wise Guy said...

Keith, we are no where near despondency. I live in Chicago and a guy just bought a bungalow in my block (a nice average neighborhood) for $450,000! What an idiot. It was a bank owned property and the poor fella thinks he got a great deal because the original listing price was 550K and he got 100K off. It is an average house; three bedrooms, two baths, two car garage and about 1800 square feet. What an idiot.

Also, I see people are mildly concerned but no one is very worried. Most people's attitude is; "oh, we will bounce back", "better times are ahead, this can't last for long", "we will face a mild recession and then the economy will come roaring back just like it always has", etc...

A lot of people believe like the statements I posted above. People are mildly concerned but still believe everything will be fine.

vanilla ice said...

"1. All Mortgage Interest Rates need to be 5% across the board"

What the heck for?! Let the debtors fail. Why does the stock market always have to go up? Why is housing and the stock market all of the sudden sacred?

Since when are we entitled to increasing fortunes?

We need failure. We need disaster. We don't need any more propping up the house of cards.

Paul E. Math said...

I'm doing my best to observe how these market swings affect my psychology. Does it seem like all the news today was bad and all anyone can see is an uninterrupted downward trajectory? Most of this is psychological, it is our bias toward the most recent news and events.

The stock markets have had a pretty bad day. After a couple just regular bad days. But this is just 3 days worth of activity.

Don't get me wrong, I think there are very real reasons for stock prices to fall (job cuts and foreclosures killing consumption). But the theme is volatility and the downward trend is gradual, with many interruptions.

There are still people out there 'bargain hunting'. Many people are still just waiting for some kind of good news to buy back in. They've been doing this for awhile.

I think this market has at least one more sucker rally left in it. Remember that Reid, Pelosi and Obama want another stimulus package and they'll get it - this won't do anything to address the structural problems with the economy but markets will rally on the next news of this package becoming reality.

Do I think the next sucker rally is tomorrow? I doubt it. But you never know.

bdrube said...

I agree with other posters that we are nowhere near despondency. In fact, based on the dertermination of many of my middle class collegues at work to stupidly leave their money in their stock funds because of the "buy and hold" mentality, I'd say many are still in denial.

Bill said...

I agree that we are still in the denial/fear stages. A catastrophic holiday season might push us into panic.

keith said...

It's so incredibly negative today, when we look back on it perhaps it should have been obvious that it was close to if not the bottom.

But it doesn't feel obvious right now. It feels like the Dow could go to 1000. That people will never return to the stores. That it's all over. That all has been lost.

That's why I smell despondency. Aren't you smelling that too?

gwk said...

I keep making money every day by buying stocks at values not seen for a generation and selling quickly because the buy and hold strategy for long term does not work but buying and selling often in minutes is working for at least me. You will look back at this time and wish you bought America is not going away it didn't in 1929 and it won't in 2008 and Obama will be a 1 term President period.

Anonymous said...

That's why I smell despondency. Aren't you smelling that too?

---------------------------

man, I want to. but the rising unemployment tsunami is just getting started. intel just cut revenue guidance by 15% for the quarter.

Anonymous said...

Wall Street is still in panic, but have you want to any open house in area you really want to live.

If you did then you know that Main Street is still in denial.

If you haven't noticed those sellers still want bubble prices, even when restate agents are begging those sellers to come down to more realistic prices.

One thing noticeable is that short sells are starting to pop up in the more desirable area priced in the $700,000 to $1,000,000 range.

Is it safe to assume that when home owner in the $700,000 to $1,000,000 are beginning to default on their monthly mortgage then this means that Alt-A and Option Arms loans are slowly beginning to recast.

too much rope said...

Keith,
With all due respect, it still smells very much like panic here in Greenwich, CT, home to 10% of all hedge funds. Was at a local strip mall today and people were acting even more self absorbed and shifty eyed than usual, totally got the sense that shouting "boo" would have caused a few trophy wives to go for their anti-depressants. To be fair, though, reality has always seemed a little slow to seep in around here.

Tyrone said...

Despondency

Third time I've heard this word, today.

First time was me describing co-workers that failed to get out of the stock market.

Second time at Peter Cooper's blog.

And now Keith.

investorinpa said...

Post of the day: Here's the link for the bailout money..feel free to apply straight off the Treasury's website:

http://www.ustreas.gov/press/releases/reports/applicationguidelines.pdf

Anonymous said...

Where are you living Keith? There's no despondency here in DC. Maybe like real estate, despondency is local?!?

patrat said...

I DO smell despondancy. It is interesting to me though, that the whole downward slide took only about a year. I wonder how long the recovery will take. Maybe not as long as people think. Does the downslide time have any relevance?

Lost Cause said...

We now resume your previously scheduled financial catastrophe, already in progress.

Lost Cause said...

How do you know for sure that somebody is lying? Their reasons keep changing.

It is the same thing as with the Iraq War.

Anonymous said...


1. All Mortgage Interest Rates need to be 5% across the board. Everyone and I mean everyone who is a homedebtor in the country receives an interest rate of 5%, no matter if they are underwater, getting foreclosed on or is in excellent standing. EVERY HOME DEBTOR IN THE COUNTRY GETS A 5% INTEREST RATE ON THEIR MORTGAGE.

2. All People willing and able to buy a home, gets a Mortgage Rate of 4%. EVERY ONE THAT IS APPROVED GETS FINANCED AT 4%.

That's pretty much it. I am sure their should be a lot more regulation to it and a few more stipulations, but that will just mess things up.

Once this is done, prices will stabilize and eventually go up.

Consumer Sentiment will go up. People will be able to sell their homes and then purchase another one at the 4% interest rate. Renters will want to buy, also.


I'm sorry, but you really do not understand the financial system. We are headed for a long-term climb in interest rates that will last many years. No desire for low interest rates will change that.

k.w. - Southern Ca. said...

More Gloom?

You darn right, there will be more, and more gloom.

The question is, what will we do about it?

Will we continue to accept the lies from out government employees, or will we start taking matters into our own hands.

Anonymous said...

The End of an Error, 1-20-09.

With grossly incompetent Bushco-Cheneyburton thrown to the curb with yetserdays garbage where they belong the US can start rebuilding and PROSECUTING.

vanilla ice said...

"We are headed for a long-term climb in interest rates that will last many years."

Agreed, nothing Bercracky can do about it except simply start giving money to the banks, ummm on second thought.

Otherwise it's skyrocketing interest rates, and crashing real estate prices everywhere, Miami and Los Vegas style except everywhere. And people are saying the housing market will bottom next year. Ha!

Anonymous said...

Keith:

You said on housing panic we were in the hope stage? Which one is it?

Anonymous said...

Here in Maryland, in the land of "it's different here", there is no panic or despondency yet. There is denial. sure, they might agree that it's not good to buy a house now, but their house is different. Their neighborhood is different .... Gosh it gets old to hear

bdrube said...

"That's why I smell despondency. Aren't you smelling that too?"

Only among those who are awake. The sheeple are still firmly rooted in denial. When THEY reach despondency, that's when the bottom is near.

Dow 1000? Yeah, that MIGHT do it.

Anonymous said...

I think we are only at fear and desperation...not quite a panic.

We are seeing signs from the vast swings in the stock market. In Sept and in the really heavy trading days in October, the big swings were caused by short covering & margin calls. Not necessarily because buyers we optimistic and going long (or looking for a bargain). For those really adept traders this is your market...not for me unfortunately.

We still need to see, massive county/state/fed ee layoffs, worker furloughs. Private sector - bankrupcties and then rescues requiring complete obliteration of the unions and benefits (think UAL). This is coming and always announced on Fridays...

But the real numbers that will catch everyone (elses) attention (main street) will be the easy to digest numbers:
Christmans retail revenue and the weekend box office wars....

The stock market is effed - again unless you are a trader.... anyone would be lucky to make some $ on their 401k if withdrawing within 5 years.

Afterall, the people who are managing TARP (you know Paulson's free $) also managed the Iraq war, Katrina relief etc...(dems & repubs equally culpable in most cases).

Despondency, not even effing close...

Anonymous said...

You have to qualify where we are on the curve by saying which market you mean:

Most stock market managers are looking to buy "the bottom". That is not despondency, its denial mixed with fear. All the hard selling is panic.

The housing market is desperation and panic in bubble markets, and denial in most others.