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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: KyrosL who wrote (30876)	3/13/2008 6:44:40 PM
From: carranza2	Respond to of 217542

Maybe, I don't know. Depends on the price paid. If very low, as you suggest, then there will still be default events, CDO folks not getting paid, counterparty risk, blow ups, etc., etc. I just don't know how such a bail out would work.

To: KyrosL who wrote (30876)	3/13/2008 7:08:56 PM
From: TobagoJack	Read Replies (1) \| Respond to of 217542

Thomas wrote: On Tues, LEH and GS report, which, imo, will be as important (if not more so) than the FED cutting ir (unles they cut less than expected) b/c even the market now realizes this has little to do with ir and everything to do with confidence the losses are quantifiable, as well as deleveraging. Just take a look how the market reacted to the S&P news. From an earnings pov, what LEH/GS report is almost irrelevant....what will matter is what their impairment charges and more importantly, what the guidance for future impairment charges will be, as well as their general comments on the economic outlook. GS especially will be watched b/c as the golden child of Wall Street their comments will carry more weight. As today showed, the market is very nervously short, pouncing on any shred of positive news to cover shorts. We saw volume on the NYSE +20%dod, although not as high as Monday's volume. Since the big longs are (still) mostly out of the market (with some cash positions in some funds as high as 50%) what this tells me is that the market WANTS to rally and that, as Heinz correctly points out, the bearish sentiment is still too extreme for the market to sell off decisively. If GS and LEH even hint at things getting better (as opposed to some credit analyst at S&P saying subprime losses are now done), I would not want to be short. Obviously if they don't the reverse will occur. Next week will be a bifurcated outcome; there will be no inbetween. Also, I respectfully submit that imo the US govt will NEVER allow the banking system to fail, no matter what. They will nationalise any bank(s) they have to (a la Northern Rock) that they deem is too big to fail. As such I would not get too excessively bearish from hereon in. Just look at the BKX; the Jan lows held last week, and if we test them again and fail to break on a closing basis, by the rule of 3 the next move likely will be sharply to the upside. Lastly, bear in mind the cycle work of Armstrong, which usually works pretty well; his next target after 2008.225 (Mar 20 or 24, an expected low) is 2009.3, an expected high. J wrote: <<the US govt will NEVER allow the banking system to fail>> ... probably true, but ... how exactly did Northern Rock shareholders make out in the 'rescue' operation? messily quivering still, or perfectly still on a stretcher? shorting the wastrels until close to zero is a viable approach, even if exciting. simple mathe says the obligations are not supportable, the debt will be defaulted, the tax payers will be shafted, electorates will get mad as hell, and the economy will shrink in real terms, more so than anyone is prepared for

To: KyrosL who wrote (30876)	3/13/2008 9:51:51 PM
From: TobagoJack	Read Replies (2) \| Respond to of 217542

the truth is for all to see ... the road markers to monetary reset ... govt bail outs are but drops of cold water on a parched throat: gutenberg.org The great majority of Frenchmen (read: Fed members) now became desperate optimists, declaring that inflation is prosperity. Throughout France there came temporary good feeling. The nation was becoming inebriated with paper money. The good feeling was that of a drunkard just after his draught; and it is to be noted as a simple historical fact, corresponding to a physiological fact, that, as draughts of paper money came faster the successive periods of good feeling grew shorter. Various bad signs began to appear. Immediately after each new issue came a marked depreciation; curious it is to note the general reluctance to assign the right reason. The decline in the purchasing power of paper money was in obedience to the simplest laws in economics, but France had now gone beyond her thoughtful statesmen and taken refuge in unwavering optimism, giving any explanation of the new difficulties rather than the right one. A leading member of the Assembly insisted, in an elaborate speech, that the cause of depreciation was simply the want of knowledge and of confidence among the rural population and he suggested means of enlightening them. La Rochefoucauld proposed to issue an address to the people showing the goodness of the currency and the absurdity of preferring coin. The address was unanimously voted. As well might they have attempted to show that a beverage made by mixing a quart of wine and two quarts of water would possess all the exhilarating quality of the original, undiluted liquid. Attention was aroused by another menacing fact;--specie disappeared more and more. The explanations of this fact also displayed wonderful ingenuity in finding false reasons and in evading the true one. A very common explanation was indicated in Prudhomme's newspaper, "Les Révolutions de Paris," of January 17, 1791, which declared that coin "will keep rising until the people shall have hanged a broker." Another popular theory was that the Bourbon family were, in some mysterious way, drawing off all solid money to the chief centers of their intrigues in Germany. Comic and, at the same time, pathetic, were evidences of the wide-spread idea that if only a goodly number of people engaged in trade were hanged, the par value of the _assignats_would be restored.