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Direxion Daily Financial Bear 3X ETF Message Board

  • dana3of52000 dana3of52000 Sep 5, 2010 9:58 AM Flag

    Tell me again why the economy is in recovery.

    From SeekingAplha:

    "2. Furthermore, the U6 unemployment is 16.7%; the highest since April. In addition, the direction of job growth is down. July had private sector jobs added was 107,000; August had only 67,000 jobs added.
    3. The direction of GDP is also down from over 5% in Q42009 to 3.7% in Q12010 to 1.6% in Q42010"
    So that means we are in or never left a recession.

    The ECRI has been at -10% or better for 2 months.
    There have been three confirmations of the "Hindenburg Omen".
    The BDI is at the lowest it has been since the crash for three months.
    Home sales have cratered and home prices have been going backwards.
    NOBODY is buying H2SO4 or any other production chemicals, prices for those are dropping.
    Greece is about to have a major problem politically and economically that was supposedly "fixed". That means the rest of the EU is in big trouble.
    Dubai, Afghanistan, UK, China, Japan all ion big trouble.

    Now who is buying stuff and why are big companies stock going up?

    SortNewest  |  Oldest  |  Most Replied Expand all replies

      ECRI dipped back to below -10%, confirming a double dip recession is now in occurence.

    • "The BDI is at the lowest it has been since the crash for three months."

      I'm not sure about that one, unless I'm misunderstanding the statement or it's implication is unclear. If the statement read, "Two months ago, the BDI was at the lowest levels since the crash", then I would agree. The BDI was at 1,700 on 7/15/10, and is currently at 2,876. I'm not attacking, just clarifying.

      Overall, I agree with your concerns and sentiments. Remember Alice in Wonderland... "We're painting the roses red"? Sounds a lot like today's reporting, doesn't it?

    • The economy is not recovering. In fact, it's getting worse. This Admin uses taxpayer money to inflate the DOW just before bad news hits the global economy. This buffers any negative wallstreet reaction.

      Watch this week and you'll see what I mean.

    • the stock market and the economy are interrelated but by no means are clear reflections of each other. In the 2008 recession, the companies in the market did not have cahs on hand to see them through such a big crisis and that is what caused all the speculation and the fear about a lot of companies. Even if it was a great company, getting credit was not easy, so too for the not so amazing companies.

      Now in the news, you hear constantly abouty how much cash comapnies are actually holding on to. While some people choose to look at that as terrible news, a lot of people look at inversely as "wow, these comapnies are reporting better earnigns than ever and they now have a ton of cash on the sidelines in case they need some protection. The market doesn't play with logic.

    • Stock market is the leading indicator

      • 1 Reply to contrariantrader88
      • Leading on what? What fact, what metric, what is causing it to go up?

        It is certainly not the economy, because ALL of the indicators of that are going the opposite way.

        If the market is a "leading indicator" is should be going down, or should have already gone down a bunch.

        Here is something form the SPG message group which is very critical on these BS indexes:

        And the big part of that is a comment further down concerning the price of SPG which is a component in the index the DRV is inverse of:

        "So in a very likely scenario, sales could easily fall 25 % over the next 2 years or so and a more reasonable price to sales ratio might be more like 2.0.

        So translating this to share price what do we have?

        (96.48) * (2.0/7.33)*(1- .25)"

        USING PRICE TO EARNINGS Ratio for the current price of SPG at $96 and change is this:

        "According to info I have, the hitorical high and low end range of the P/Sales (per share) ratios are 6.09x and 3.30x respectively.

        And the current P/S ratio for SPG is at 7.33. (1.98 for the S&P)

        (As an aside, the Price to Free Cash Flow ratio is 30.63 )"

        So in review the REITS are looking at a 60-70% haircut off these stocks.

        The market goes up on this????

        =========>> $19.74"

38.63+0.76(+2.01%)Apr 29 4:00 PMEDT