Dow Crash Coming To Your 401K (2007 to 2022)

[Bindare_Dundat]

The market is rebounding right now. Did the new record jobless claims help? 

[Neurotoxin]

The market is rebounding right now. Did the new record jobless claims help? 

without intervention by the PPT, this market implodes. 



NT


Jobless claims highest in 26 years. Continuing claims set record high.


NEW YORK -- The number of Americans filing for first-time unemployment benefits surged last week to a level not seen since October 1982, according to a government report released Thursday.

The number of initial jobless claims jumped to a much-higher-than-expected 626,000 in the week ended Jan, 31, according to the Labor Department. That's up from a revised 591,000 in the previous week and the highest level since the last week of October 1982, when jobless claims reached 637,000.

[Neurotoxin]

the stock market cannot produce a sustainable rally without the banks....period.

 

U.S. Stocks Gain, Led by Banks.


Feb. 5  U.S. stocks advanced for a second day after MasterCard Inc.’s profit topped estimates and an analyst said Goldman Sachs Group Inc. and Morgan Stanley are healthy enough to repay government bailout funds.

MasterCard, the world’s second-largest credit-card network, jumped 13 percent. Goldman Sachs climbed 5.3 percent and Morgan Stanley added 6.4 percent to lead a rally in financials that lifted Bank of America Corp. from a 24-year low. 

The S&P 500 rose 1.6 percent to 845.61 The index lost as much as 1.5 percent in early trading after initial jobless claims unexpectedly jumped to a 26-year high. The Dow Jones Industrial Average climbed 106.02 points, or 1.3 percent, to 8,060.68.

[War-Horse]

U.S. Stocks Gain, Led by Banks.


Feb. 5  U.S. stocks advanced for a second day after MasterCard Inc.’s profit topped estimates and an analyst said Goldman Sachs Group Inc. and Morgan Stanley are healthy enough to repay government bailout funds.

MasterCard, the world’s second-largest credit-card network, jumped 13 percent. Goldman Sachs climbed 5.3 percent and Morgan Stanley added 6.4 percent to lead a rally in financials that lifted Bank of America Corp. from a 24-year low. 

The S&P 500 rose 1.6 percent to 845.61 The index lost as much as 1.5 percent in early trading after initial jobless claims unexpectedly jumped to a 26-year high. The Dow Jones Industrial Average climbed 106.02 points, or 1.3 percent, to 8,060.68.

I remember one of your posts from last year stating the dow would one day hover around 7900,  here it comes!!       I think another million or more A.R.M.'s are going to reset this year and keep us in turmoil.     How low you think the dow will go now NT??   Be interesting to see the REAL bottom of this mess!!

[The Luke]

The real bottom is the Dow Jones at ZERO... when the dollar collapses; followed by the pound sterling; followed by the ruble... all to be replaced with a gold/silver (possibly also oil) backed world currency.


The Luke

[War-Horse]

The real bottom is the Dow Jones at ZERO... when the dollar collapses; followed by the pound sterling; followed by the ruble... all to be replaced with a gold/silver (possibly also oil) backed world currency.


The Luke

I do think thats a possibility also.   I dont know if it will bottom out tho or we will be slowly talked into it as our only choice.   Hopefully the transition is done so people dont make a run on the banks and start looting and stuff.......it could be done in a more civil way.....

[Neurotoxin]

S&P continues to hold 800 despite economic news. right now the strongest sector is SMH. (semi's) if WS ignores Fridays economic numbers,(similar to yesterday) expect a big short cover rally heading into the weekend. sparse economic data for next week could lead to a nice bear market rally.

as i've mentioned before, GS is a key player in the PPT. if GS and SMH are working together....we head higher.

S&P range = 800-920


just my opinion.


NT 

[Neurotoxin]

focus on how the market reacts to todays negative economic data.

keep a close eye on GS.


NT


U.S. Jobless Rate Soars as Payrolls Plunge by 598,000 


Feb. 6  The unemployment rate in the U.S. climbed to the highest level since 1992 in January and payrolls tumbled as the recession showed no sign of abating. 

The jobless rate rose to 7.6 percent from 7.2 percent in December, the Labor Department said today in Washington. Payrolls fell by 598,000, the biggest monthly decline since December 1974, after dropping by 577,000 in the previous month.

[Bindare_Dundat]

focus on how the market reacts to todays negative economic data.

keep a close eye on GS.


NT


U.S. Jobless Rate Soars as Payrolls Plunge by 598,000 


Feb. 6  The unemployment rate in the U.S. climbed to the highest level since 1992 in January and payrolls tumbled as the recession showed no sign of abating. 

The jobless rate rose to 7.6 percent from 7.2 percent in December, the Labor Department said today in Washington. Payrolls fell by 598,000, the biggest monthly decline since December 1974, after dropping by 577,000 in the previous month.

CNN Money: Give your basement an extreme makeover.

Though Beth and Ken Wilson's 5,000-square-foot, four-bedroom home in Union, Ky. wasn't exactly cramped when they bought it in 2005, they yearned for a space that could accommodate the passions of their two oldest sons (their three boys are now 17, 12 and 2) yet allow adults to enjoy activities too. So shortly after they purchased the home, the couple decided to turn the house's dark, mostly unfinished 2,000-square-foot basement into a livable lower level.



What planet are the people at CNN on? Don't they read their own news?

[Neurotoxin]

S&P continues to hold 800 despite economic news. right now the strongest sector is SMH. (semi's) if WS ignores Fridays economic numbers, (similar to yesterday) expect a big short cover rally heading into the weekend. sparse economic data for next week could lead to a nice bear market rally.

Feb. 6  U.S. stocks gained, sending the Dow Jones Industrial Average to its best two-day rally in a month, on speculation the highest unemployment rate since 1992 will force Congress to pass an economic stimulus package.

The S&P 500 rose 2.7 percent to 868.6. The Dow added 217.52 points, or 2.7 percent, to 8,280.59, capping a 4.1 percent two- day gain. The Nasdaq Composite Index climbed 2.9 percent, erasing its 2009 loss.

[Alex23]

looking back it appears Bush's "robust", "broad-based" and "timely" stimulus was completely ineffective. 

Bush borrowed and spent America into the poor house/depression. he's currently compensated $40,000 per month by tax payers (pension) for his hard work.
NT

NT when do you expect the GDP to turn around? Here housing is already showing signs for "improvements" foreclosures are moving pretty fast, anything that shows well moves in a matter of days. I've made several offers I'm waiting on. 

[The Luke]

NT when do you expect the GDP to turn around? Here housing is already showing signs for "improvements" foreclosures are moving pretty fast, anything that shows well moves in a matter of days. I've made several offers I'm waiting on. 

...dude, we're deep into GD2 here (Great Depression Two) and you're bidding on property thinking prices are going to go UP...?



The Luke

[Alex23]

...dude, we're deep into GD2 here (Great Depression Two) and you're bidding on property thinking prices are going to go UP...?

The Luke

when there's blood in the streets, buy properties.

I can rent 'em for less than the mortgage payment. With all the foreclosures, everyone is renting these days.. if not I can sit on it as well....

Maybe you should pop out of your mom's basement and smell the coffee and shake the paranoia off..

[Bindare_Dundat]

...dude, we're deep into GD2 here (Great Depression Two) and you're bidding on property thinking prices are going to go UP...?




The Luke

lol

[The Luke]

Having re-read my post I realise it comes off a little overly aggressive...

Rather than (dishonestly) edit my post (which has been viewed already) I'll just apologise and ask Alex23 if he could clarify what he meant a little...?

-Do you plan to immediately flip these properties?

-How long do you intend to hold these properties?

-Are you buying from distressed sellers? Well below market value?

-Aren't you worried the market could step down severely BEFORE you make it out of Escrow?

-Don't you think an asset as sizable as a house is a little too large a chip to be betting on something as wildly volatile as the current housing market...? Especially considering the general downward trend?

-Where do you live that houses are appreciating in value?  


The Luke

[Alex23]

The Fluke, here are your answers below.

Hope this helps

-Do you plan to immediately flip these properties?
-How long do you intend to hold these properties?

Depends on the property but most likely not, 5years

-Are you buying from distressed sellers? Well below market value?

Strictly foreclosures and short sales. The worse the property "shows", the better. We also have a lot of cash so it makes it easier to negociate with the banks who own the property.

-Aren't you worried the market could step down severely BEFORE you make it out of Escrow?

Not sure what you mean but escrow take about 30days, sometimes a little less...

-Don't you think an asset as sizable as a house is a little too large a chip to be betting on something as wildly volatile as the current housing market...? Especially considering the general downward trend?

Volatile? real estate is investment in slow motion... as I said, most properties can be rented and be cashflow positive from day one.

-Where do you live that houses are appreciating in value?  

San Diego County

[The Luke]

Alex23,


Thanks for the answer... but I'm afraid I still don't understand your reasoning.

I know Escrow takes about 30 days (longer here in Europe), but to be honest I think it's crazy to risk any amount of capital in the housing market even for that amount of time, considering what is currently happening in that market.


Let me give you a little foretaste of what is coming to the American housing market...

Here in Ireland we have a very socialist minded population, who, having suffered 800 years of disenfranchisement at the hands of British landlords (Ireland has only been a totally sovereign state since 1922) jumped headlong into a "land-rush" style housing bubble. Just like the US.

My parents humble house (30' by 30' footprint), (from the basement of which I make my posts), was valued at €800,000 in 2006 (that was equivalent to $1.2m), and house prices increased by between 12 and 22% EVERY YEAR consecutively for more than a decade. Banks offered 100+% "liars mortgages" (no proof of income); interest-only 35 year "speculators mortgages"; and 120% mortgages for working couples.

That was then.

Just last month a working married couple with a combined income of €90k (€50k and €40k) hoping to borrow a measly €120k to build on land donated to them by her parents... that's free land; full planning permission; €200k in cash and a property (nearly complete) that should be worth €480k when finished, even allowing for a 50% collapse in the housing market (would have been worth close on a mil at the peak of the boom in 2006).

They were denied the 20-year €120k mini-mortgage by Bank of Ireland on the grounds of insufficient job security...


Wait for it...


...the husband is a bank branch manager with Bank of Ireland, and the wife is a mortgage broker with Bank of Ireland.


That's what's in store for the American market.

There won't be rents-higher-than-mortgage-payments; there won't be any housing market to speak of, not when America's unemployment rate is topping 30% (according to ShadowStats.com it's already pushing 20%).

If I were you Alex I wouldn't be investing in real estate... you'll be hard pressed to make a profit, especially five years from now when America has 30% unemployment; martial law; Weimar Republic style triple digit hyperinflation; roving bands of gun-toting Mad Max style bandits; $500 a barrel oil; and people starving in the streets.

Don't think it won't happen, in the 1920s no one thought the great Depression could happen... all of that is on the way.



Meanwhile, my savings are going into gold-bullion... and the parents that were urging me to scrimp together a mortgage deposit only two years ago are now congratulating both my brother and myself for having the prescience to sit out the hysteria.

Apologies again, for the offensive remarks... it's just that your sunny outlook seems so divorced from the reality on the ground that it seems almost delusional. Again, no offense intended.



The Luke

[Benny B]

There won't be rents-higher-than-mortgage-payments; there won't be any housing market to speak of, not when America's unemployment rate is topping 30% (according to ShadowStats.com it's already pushing 20%).

If I were you Alex I wouldn't be investing in real estate... you'll be hard pressed to make a profit, especially five years from now when America has 30% unemployment; martial law; Weimar Republic style triple digit hyperinflation; roving bands of gun-toting Mad Max style bandits; $500 a barrel oil; and people starving in the streets.

[benz]

US$500 barrel oil

[Bindare_Dundat]

[Neurotoxin]

NT when do you expect the GDP to turn around? Here housing is already showing signs for "improvements" foreclosures are moving pretty fast, anything that shows well moves in a matter of days. I've made several offers I'm waiting on. 

with GDP is still contracting, i'm not comfortable making an accurate long term prediction. right now, 2010 looks to be an early GDP up tick timeframe imo.

if you're considering real estate, be very careful and play hardball (with price) as i expect the RE market to further contract in 2009. buying foreclosures and short sales is prudent, but only if you plan on holding for 5+ yrs and stumble on some really great deals.

good luck.


NT

 

[Eisenherz]

Neuro, is it worth stocking up on lots of gold or silver right now or should one wait it out?

[benz]

with GDP is still contracting, i'm not comfortable making an accurate long term prediction. right now, 2010 looks to be an early GDP up tick timeframe imo.

if you're considering real estate, be very careful and play hardball (with price) as i expect the RE market to further contract in 2009. buying foreclosures and short sales is prudent, but only if you plan on holding for 5+ yrs and stumble on some really great deals.

good luck.


NT

 

Since you are keeping it positive, im gonna keep it positive also, heres my question:

You mentioned money market funds are a good choice to protect money, but how can you be sure of that when funds such as The Reserve has liquidated almost all of its funds, and the nav of the main fund is at 0,97 (broke the buck).

Also, what do you think of german banks such as commerzbank & deutsche bank. They were supposed to be pretty "conservative" (if we can call it like that, thats it) and you can see now that the goverment is taking part of them so they wont go down (even though commerzbank value is almost zero).

Last note, Whats your point of view about chinese companies being able to pay in a near future their bond compromises. No defaults yet but its getting worse.

[Alex23]

with GDP is still contracting, i'm not comfortable making an accurate long term prediction. right now, 2010 looks to be an early GDP up tick timeframe imo.

if you're considering real estate, be very careful and play hardball (with price) as i expect the RE market to further contract in 2009. buying foreclosures and short sales is prudent, but only if you plan on holding for 5+ yrs and stumble on some really great deals.
good luck.
NT

Thanks good to have you back. Hope the family is doing well.

Take care.

[Hugo Chavez]

awesome work bros.  Thank you Alex, Benz and all.  Well worth reading, keep it up.