One of the best posts I've read in quite some time:
by L3 aka L3
What tax thing?
I have been reading around SI all over and I see a lot of anger that the Fed hasn't dropped the rates. I got a bit ticked myself as people just dont seem to get it! I finally couldn't bite my tongue and wrote a post on it at a different thread. Figured I would post it here too. FWIW, I too bought a dip today and lost some but I blame no one but myself as I trade TA for my short term trades but at least I know we have no reason to go up based on FA. SOme of these other people I read believe we should be saved from ourselves. Anyway, My post........
I applaud AG for his actions today. He has been seen as a savior to the market for too long and one would think that the fools and their money would trade on FA instead of "hopes" for a rate cut to save them. Ag never has like these valuations and would have been stingy sooner except for being backed in a corner due to the Asian crisis, Russian meltdown and then the perceived Y2K liquidity risk that never materialized. There is no reason for him to be loose now. The employment data is still too tight, wages are going to go higher as employees start demanding cash instead of options ( See WSJ article today about MSFT wages) Oil is up, Natural gas has tripled and consumers are still piling up credit.
Almost everyone agreed there would be no rate cut today yet the Mo Mo crowd kept bumping each other out of the way to get in first just in case there was a surprise cut until prices were up 5 - 10%. We were up almost 100 points today on no good news!!! This just proves to me that we haven't seen enough pain yet and I bet AG was watching the market from the conference room shaking his head in disbelief.
I think we need to wash out every last dime from the uneducated Mo Mo trader and get back to a FA based market based on real earnings valuations instead of pipe dream pie in the sky promises. Look at QCOM, it is still in the stratosphere. I say we don't hit bottom until that one and the last few remaining obscene stocks get taken to the cleaners. Everyone says we are at risk of a recession but we are still over valued by every historical measure ever tracked and all this while we skid to slower growth and lower earnings for the next 2 quarters. KO with a PE of 80, fiber companies and routers companies with PEs in the hundreds when their customers can't even get a loan for under 25% interest on their junk bonds? What are they going to pay their bills with, pokemon cards?
I would giggle my butt off if he didn't cut until next summer. Unfortunately, he is the fed chairman and he can't use grudges to get even with the idiots that ran this market up to ridiculous levels so I figure he will cut and may even do a surprise between meetings cut but I hope he doesn't. The price action today was unbelievable. All the Mo Mo stocks I watch were up 5 to 10 points on no news. Until this stupid stuff stops, we need more pain. I hope we open lock limit down tomorrow and keep dropping all day. I want to see every trigger tested to see if they really work. <ggg>
This market has resembled a casino instead of a stock market now for 2 years. We need a rational stock market again. There are lotteries and casinos for the stuff that has been happening on Wall Street so if people want to gamble, they can go to those places. This is supposed to be a place for investing and it hasn't been safe to do that here for years.
Good Luck,
Lee |
