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ProShares UltraShort Dow30 Message Board

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  • weburk weburk Jan 16, 2009 5:21 AM Flag

    Reality is hard part one

    Both of you are true genuises, listen we have to play wall streets stupid game on these fake 5 day bounces. They will give the fake 325 bill tarp a fake bounce tomorrow, they will give obamas hope speech a fake bounce on Monday. They are trying to preserve the retirement accounts for millions of Americans. They are trying to soften the blow by claiming that they know businesses are losing 90% of profit and growth. They are full of $hit. Just play the fake bounce till they can't fool or fake it anymore. Let the markets bottom which is not 8k but a drastic slap in the face of flat 7k. Yes shocker. But it's time to stop the b.s.

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    • I'm fascinated by the psychology behind the downtrend resumption in the Spring of 1932 and its parallels to our current situation.
      Everything is saying our emotional/psychological/technical and macroeconomic condition is identical to then.
      They had a close to 50% pullback. So did we.
      They had eroding economic conditions. So do we.
      They had government intervention in the banking sector. But no assistance to consumers. So do we.
      People are convinced it can't happen. So were they.
      The capital destruction and the consumer refusal to borrow are the same.
      The integration of the international markets was very similar but the central bank structures were different.
      The way I've read it is that what really triggered the downward slide was the onset of protectionism and then the implementation of it.
      I don't know if the pullback will be the same without it but the political upheaval is going to begin very soon if things don't change.....seems inevitable.
      The question is will the central banks have enough clout to keep control of the international trade situation?

      • 2 Replies to livermores_ghost
      • The difference between now and then is they have turned on the money spigot much more agressively this time.

        But one could use a very crude comparison to the GD and the 70's recession to get a rough calculation of how far the Dow could fall.
        If this is systemically worse than the 70's but maybe not as bad as the GD you average the market declines for both and come up with a final number.

        The Dow topped out at 1,040 in Jan. '73 and bottomed at 575 in Dec. '75.
        A 45% decline.

        The Depression took almost 90% off the Dow.

        14,200 - the '07 high minus 45% takes you down to 7,880.

        Now split the difference between the Depression and the 70's recession and you get a 67.5 decline from the highs.

        That puts the Dow at 4,615.

      • I don't know but I am buying a few shares and will add, with all sizable dips, enough to sell some on any big runs. I will trade but I will accumulate good beaten down stocks..I believe in fear and I believe in greed and there will be again a time for greed. So, I will trade but there will be a day when I will stop because a trend will develop or I will be tired and quit.

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