Black Monday

[winner69]

I reckon Monday 31st Oct. 1 week and bit before USA elections........)

I love Kuntsler's writings. A great commentator on the world affairs

Haven't linked any Cluster**** blog posts for a while - seeing you mentioned the US elections here goes. You will enjoy this one


http://kunstler.com/cluster****-nation/trending/#more-'

Link censored but seems to work - otherwise paste in browser and replace the **** with the f word. All clean stuff

Extract -

Imagine the scene following Hillary’s election. In order to salvage the last shred of its credibility, the Federal Reserve raises its overnight funds rate another quarter percent and crashes the last Potemkin semblance of a “recovering” economy, that is, the levitated stock markets. Tens of millions of retired individuals previously driven into them by zero interest rate policy are wiped out. Even more gravely, pension funds and insurance companies are destroyed, but not before their troubles trigger derivative contracts with big banks which then explode and expose the inability of counterparties to make good on their ends of the bet.

In a blind panic, the Federal Reserve reverses its policy in December, drops the Fed Funds interest rate back to 25 basis points and announces the grandest new round of “quantitative easing” (money printing) ever, while congress is coerced into voting for the greatest bailout of institutions the world has ever seen, along with a “one time” helicopter drop of a cool trillion dollars in the form of combined tax cuts and “shovel-ready infrastructure projects.” The media rejoices. The US Dollar tanks. Absolutely nobody wants US treasury bonds, bills, and notes. The pathetic remnant of the American middle class stares into the abyss. (If it looks hard enough, it sees the US government down there.)

[skid]

I love Kuntsler's writings. A great commentator on the world affairs

Haven't linked any Cluster**** blog posts for a while - seeing you mentioned the US elections here goes. You will enjoy this one


http://kunstler.com/cluster****-nation/trending/#more-'

Link censored but seems to work - otherwise paste in browser and replace the **** with the f word. All clean stuff

Extract -

Imagine the scene following Hillary’s election. In order to salvage the last shred of its credibility, the Federal Reserve raises its overnight funds rate another quarter percent and crashes the last Potemkin semblance of a “recovering” economy, that is, the levitated stock markets. Tens of millions of retired individuals previously driven into them by zero interest rate policy are wiped out. Even more gravely, pension funds and insurance companies are destroyed, but not before their troubles trigger derivative contracts with big banks which then explode and expose the inability of counterparties to make good on their ends of the bet.

In a blind panic, the Federal Reserve reverses its policy in December, drops the Fed Funds interest rate back to 25 basis points and announces the grandest new round of “quantitative easing” (money printing) ever, while congress is coerced into voting for the greatest bailout of institutions the world has ever seen, along with a “one time” helicopter drop of a cool trillion dollars in the form of combined tax cuts and “shovel-ready infrastructure projects.” The media rejoices. The US Dollar tanks. Absolutely nobody wants US treasury bonds, bills, and notes. The pathetic remnant of the American middle class stares into the abyss. (If it looks hard enough, it sees the US government down there.)

The further they go with the experiment ,the worse the outcome....case in point..the bit about Mom and Pop retires being driven into the share market for returns ,when normally they would have just saved their money in t deposits--Now they are caught in a system that cannot go on forever

[bull....]

big night tonight

[Hoop]

The further they go with the experiment ,the worse the outcome....case in point..the bit about Mom and Pop retires being driven into the share market for returns ,when normally they would have just saved their money in t deposits--Now they are caught in a system that cannot go on forever

My parents told me the common belief in NZ at that time ...kiddy wisdom..if you want to protect your wealth beware of instutions offering high interest rates...I guess that relates to higher than the market rates which in NZ would be ~2% atm...

So if my parents were still alive,would they still be saying ..to protect your wealth, stocks (or any other instrument for that matter) offering 8+% (interest or yield) should be avoided??...

Is this time any different...

In 2007 many thought that time was different.. Many NZ oldies (who obviously forgot about their kiddy wisdom speeches 40years previous) deposited all their hard earned saving into Finance companies term deposits that were offering interest rates about +2% higher than the market..the excuse was "we can't live on 8% interest so 10% from the finance companies helps us to survive"

Edit: inflation rates.. 1993 to 2016 are in a 0% - 5% trading range...Inflation 2007 was 2.5%

[littletramp]

I'm confused - when the shoe shine boys and taxi drivers tell you the share-market is in for a big correction is it time to get in or out?

[fungus pudding]

I'm confused - when the shoe shine boys and taxi drivers tell you the share-market is in for a big correction is it time to get in or out?

Definitely.

[Hoop]

Interesting...
This mornings NZ all index 1.5% drop......The banks are for once not leading the drop...so we can assume this drop (fueled from Europe/Wall St) isn't something financially sinister (yet?) ...It seems to be the start of another normal correction after a long strong rally...profit takers......The biggest ralliers are taking the biggest hits ..many are high yielders...

[winner69]

Interesting...
This mornings NZ all index 1.5% drop......The banks are for once not leading the drop...so we can assume this drop (fueled from Europe/Wall St) isn't something financially sinister (yet?) ...It seems to be the start of another normal correction after a long strong rally...profit takers......The biggest ralliers are taking the biggest hits ..many are high yielders...

It was down 1% on Friday as well. ....yep just a little downer in the ebb and flow of the NZX as it heads to 8000

[winner69]

Might qualify for a Black Monday

No worries though - just as Mark Knopfler said 'there's always sunshine after rain / a good Tuesday always follows a bad Monday / why worry'

From twitterland


David Ingles‏
@DavidInglesTV So it's a not a normal day. In NZ, it's a 4-standard-deviations kind of sell-off; happened only 3x the last 6 yrs

[Snow Leopard]

A day to give the Buy button a holiday.

Mind you I am out-performing the markets, down only about 1.1% at present

Best Wishes
Paper Tiger