Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Ride the Tiger with CD -- Ignore unavailable to you. Want to Upgrade?

To: riversides who wrote (132631)	10/3/2008 12:13:54 AM
From: Rocket Red	Respond to of 314136

now is not the time in my opinion only for quick flips Buffet also gettting super deals too his benifit cause he has the cash on hand.No cash No deals can ever be bought

To: riversides who wrote (132631)	10/3/2008 1:31:01 AM
From: E. Charters	1 Recommendation Read Replies (2) \| Respond to of 314136

Cash is useless. It is a bank deposit that makes bankers money, but not the owner. It is a loan. What you are saying when you want cash is that you want to loan money to a banker. You aren't going to put it in your mattress. Who is the banker going to loan your cash to? Somebody who says they can't get it? Or to some cronies of his for another phony ABCP scam? Don't put your money in a bank. If the money has value, that means the things it intends to buy or invest in have equal value. It cannot be otherwise. If it did not then there must be a rapid devaluation vector, where the money is gaining value over goods. We see that happening, and it is only because the money is not being put to work. In effect goods are being shorted by money not being spent. Tricky but it only works for so long as interest catches up to you. The whole economic equation is acting as Mises predicts. People are showing a preference to not buy, as the market prices are too high still for the risk. It was clear that the market was overpriced. It cannot go up forever. When you look at the 2004-2008 market curve, you see plainly that we have returned to 2004 levels of most prices. This is not entirely a bad place to be. If we compare it to 1920 to 1929 what do we see? 1920-1929 This is very different. Some fundamental stuff is the same. Rapid rise in real growth and new tech and compounded credit on top of that (margin at 3 to one). But the rise is much slower and the drop quicker. A lot more was invested in the 1920's boom. Society by contrast hardly changed at all between 2004 and 2008. It is a symmetrical rise and fall. I don't think the consequences of the crash of 2008 are at all the same as the 1929 crash. The 1929 correction saw 25% of the value erode very quickly. Austerity caused unprecedented contraction in the following years. The Dow fell to 50 points or less by 1932, an 86% loss. That would be equivalent to a fall to 1960. I doubt that will happen. I believe the Dow will correct at around 7600 or more. Back then the Dow took 14 years to recover. If this sort of thing happens I suggest modifying your drills to dig rutabagas. They always sell well in a big D recession. 1930-1940