I am just trying to help the people on this board. I am not really a yield chaser or high dividend guy. I manage trust funds for private folk. I pick this message board based on my superior knowledge of equity valuation, market cycles and the enormous bubble in YIELD SEEKERS by average folk, many of this group are senior citizens. The group that have paid a huge price for yield with very negative determinants is MORTGAGE REIT investors, there is only one other group near you guys, that is the MLP (Energy Master Limited Partnerships). Professionals have a hard time making money in these. Yet both of these boomed or bubbled over the past 7 years of Zero Percent Interest rates which caused bubbles in the Energy and Materials Industry and Bubbles in MBS pricing of 30 year fixed interest mortgages. All of this bubble was the result of misdirected policy by the FED. Now the FED has to correct this or this country will have job stagnation for several generations.
The above two groups of yield seekers if they buy and hold those investment will be crushed, please don't be one of them. If you need yield or something take into account basic investment analysis when you research an equity. If you like this industry, the only safe investment is the preferred stocks of NLY and AGNC which yield 8%, otherwise these m-reits and MLP's are not investments, they are mouse traps of capital loss.
Indexes were down 10%, if we stabilize today we have 25% more to go by end of October, and we will perfectly match the 35% decline in S&P from 1300 to 840 in same time period, August - October 2008, and don't forget it doesn't stop at 35%, there was a year end VERY POWERFUL RALLY that declared the end of the Bear Market, but we all know the indexes fell an additional 30% by March of 2009. I am not predicting the 65% decline in this time frame, but being an election year and there is widespread dislike of the current administration and it appears to becoming more and more probable
I notice you title, do you have any military experience. I will pass your name on to the Donald for consideration for Chief of Staff or maybe a high spot in the Pentagon. What branch were you in?
Part 2: History is the Best Guide, S&P from 1,300 to 840, August 29 to October 2008.
August 29, 2008 Crude Drops 10% in one day, S&P drops from 1300 to 1210
Selling continues lightly with market internals very negative like now.
Around 9/18/2008 a VIOLENT RELEX RALLY up 4% in 1 day , last 5 days, highest closing uptick in 5 years when FED anounces ban on short sale of bank stocks was the headlines ensues with happy talk from FED may bail out Fannie and Freddie of all losses, S&P moves 1210 to 1270.
9/24/2008 S&P hits midday high but still 40 pts below 9/18 high, around 1230.
10/1/2008, S&P plummets to 1120 over several progressive down days.
10/3/2008, S&P rallys to 1160, Gov happy talk and bill passes to bailout someone, BIG GAP UP IN MORNING, bobble head financial reporters declaring end of bear market, heavy selling in after noon erases more than half the gain, still the reporters touted it as sign the bully market is intact on evening news.
A few days pass.......
10/7/2008......Market Opens at 1110 and gaps down VERTICAL DESCENT TO 1,000, recovers late only down 400, financial press report HEAVY BUYING CAME IN, not really they cut the phone lines to the stem the little guys from selling, while the high rollers had all the air time to get trades off. 10-7 to 10-9, S&P down 110 points to 1,000.
10/9/2008......Short Cover in strong gap up rally in morning, then just hangs there, zero enthusiasm, the momentum traders all just staring at eachother to see who blinks first, then selling ensues, massive shortly before the close.
10/09/2008 to 10/10/2008 Massive SELLING, S&P goes from 1020 to 840, gut wrenching, Global Thermopukular Descent, VERTICAL DROP.
This is the drop that I vision for August to October, 2015, Take the template for the S&P 500 index for 2008 and put it over the chart for 2015, for those who say history does not repeat, I believe you will see shortly that history does indeed rhyme.
TRUMP AND KLUMP IN 2016.
Keep the Faith, Bobbles.
I haven't deserted anyone, I was at the broker manually entering trades due to electronic order entry problem's. WE ARE IN A BEAR MARKET......period. I said the "Slope of Hope" will have 4-5 progressive down days followed by 2-5 up days with recovery of half or more of the vertical descent. This is a FED or Gov. induced happy talk that generates weak short sellers to cover and the other half of this buying is short term momentum traders trading the deterministic algorithm that is 100% valid based on historical evidence, the air pockets and gap downs or gap ups either way has back and forth movement. The evidence to watch for is the variance during the day and how fast the sentiment changes, both of these parameters are determinant, based on historical dogma and widely accepted by bull and bearish market technicians. I was entering numerous order yesterday to play the swing. I got TBT at 40.50 to 45 swing trade, AT&T 31 - 34, so many too numerous. Sorry I wasn't here, I didn't know you missed me for one afternoon.
History is probably the best guide to estimate the next few months, because the fact is we topped out in a Bull Market in May 2015, market internals broke down dramatically signaling a trend change, a MASSIVE ONE,
NYSE New Highs & Lows both greater than 2.5%
NYSE new highs less than 2X new lows
McClellan Oscillator Breadth negative and went extremely neg. in July
At least 2 signals in MC Osc. in 36 days.
% of stocks above own 200 day MA less than 60%
Market internals are very terrible in the indexes even on this two day rally, volume is much less than Monday and Tuesday, and don't forget the enormous volume of etf funds whose orders to sell never got filled, read about that in the Wall Street Journal on Tuesday and Wednesday. Still investigating but the morning plunge on Monday should have been more that 1,000, the rapid reversal and the gap up in the half hour where all 1,000 was erased was not buying, IT WAS PURE MANIPULATION.
I am detecting order imbalances again. I would sell AGNC at 19.40 and if you want to buy it back at $18.25 at the close, that's OK. Make a dollar and change daily, it adds up to 250 day/yr x $1 = $256 return on a $19 stock, not bad.
Otherwise SELL INTO ANY STRENGTH.....market internals have broken down there is no support, the rally this morning is traders and very weak buyers, this will be sold into by the professionals. I would try to unload stocks into any rallies and raise cash for some better buying opportunities. Before this descending triangle, the slope of hope is done, markets will be down 25-65%, if this is a full blown panic, I mean the financials here have been insane for this whole country, everything is debted out to the max, real value has been hidden with suspension of "Mark to Market" accounting.
During Bull Markets, people will come up with all types of stochastics and formula touting how this is going to go a lot higher this time or that time, because we are in a BULL MARKET, "bull" sells a higher valuation. And during bull markets there are a whole lot of paradigm by really smart analysts and brokers and hedge funds, because they all reinforce the story to get the prices higher, there are lots of buyers looking for upside action. In Bear Markets, those bullish buyers start to dry up along with all the reasons, stochastics and formula's touting the next great growth stock, some will emphasize earnings, some just sales like Amazon, who needs sticken earnings in a bull market.
BUT in a bear market those people get washed out in the downward slope of hope, their new paradigms go with them and Stock Price Valuation becomes deterministic, using natural long time historical formula and paradigms that are 100's of years old and still in force. REMEMBER THIS: DURING BEAR MARKETS THE BOTTOM IS DETERMINED BY THE PRICE A PROFESSIONAL VALUE BILLIONAIRE WILL PAY FOR A STOCK WHEN THERE IS A HUGE ORDER IMBALANCE ON THE SELL SIDE AND NO BUYERS ANYWHERE. The algorithms used to determine that LOW BUY PRICE by these value Billionaires is based on very old and easy to understand ratio's. Price to book value, average low PE's based on 5-10 years of normalized earnings. They estimate earnings based on equal number of bad years and good years, they use average low PE's for at least 5 years and then they start buying everything for sale and a bottom of the BEAR MARKET is made, like March 2009. In Bear Markets there are only a couple paradigms, AVERAGE LOW PE, Price to Tangible Book. What is AAPL tangible book value and average low PE value, pick the lowest, that is the bottom.
In a bear market. Does anyone have the stats at their finger tips. I need the low PE ratio for Apple for 2009.
Apples low target price in 2015-2016 bear market is its average low PE times estimated earnings for 2016, forward earnings. I believe a 50-60% correction from current prices is very possible. This is a deterministic algorithm, all the stochastics on why Apple was worth this or that during a bull market don't apply anymore, it is the lowest value price that BILLIONAIRE value investors will buy a stock in a free falling market. THIS IS A STRONG SELL, along with Amazon and any other high PE or high growth stock, it is all about valuations.
This is a test of the AGNC emergency message board. THIS IS ONLY A TEST. Do not panic. When I post, I believe all the other posters should stay of the airwaves (i.e. the message board) until I get my posts out. During times like this we need the facts and the truth. We need TRUMP or KLUMP or anything that rhymes with these names. This is the end of the emergency "Clear the Airwaves Test".......
TRUMP AND KLUMP in 2018 '
My algorithm, based on deterministic components indicates a further 25% correction from todays close before market equilibria sets in. This will show on the oscillator charts or the log graphs as vertical line down. This is totally natural and 100% expected mathematically, if you know anything about the stochastics and determinants of modern stock market pricing theory.
The DOW THEORY along with the McClellan Oscillators and the Hiddenberg Omen indicators all flashing "STOCK CRASH", just like the 1987 crash week. There are so many buy the dip bobble heads here with 7 years of profits that I think it will take 3 weeks to clear these guys out of their ill gotten profits.
If you are risk averse, why didn't you SELL at Noon, have some faith, I am accurate by the hour here. I hope those who bought TBT at 40 are still holding, TBT is a golden goose.
You know what was funny today, Pisani bragged that all the DOW stocks were Green or UP in the first hour of trading this morning. The headlines at the market close "DOW reverses and ends down in the Biggest Reversal Day since 2007". What is really funny is all the DOW stocks were red. In fact, there was widespread selling in every industry, including health care and utilities, which are suppose to be immune to downturns. POM down 16.44%, EXC down 6.86%, both are utilities and are suppose to be safe. STRONG SELL on EVERYTHING. Short at will. The only two stocks I am long today, was TBT that I bought yesterday at 40 and change and my beloved small bank Hawthorne HWBK, both of these were green today at the close not at the opening.
You will tell your grandchildren how Dr. Klumps outsmarted Goldman Sachs and made predictions by the hour on a 1,000 point swing day in the DOW. Three days in a row, I will be remembered in the HISTORICAL ARCHIVES of Yahoo as the Greatest Stock Market Forecaster of all time.
I predicted this last week, 500-1,000 point swing days in the DOW. Totally natural at market tops. Professionals are very passionate to raise cash and get out of stocks at the top. It is the Ma and Pop investors who keep buying the dip like this morning, I did not see hardly any pro's buying this morning, all momentum traders and amateurs. They are being slaughtered before our very eyes. 401K's are getting butchered. Rates have to go up now big time to earn enough money for boomers to retire on.
On a scale of 1 - 10, I am a 10 Goldman is a 5. I was telling you guys we entered a bear market in July, the stock prices were 20% higher.
This afternoons action is very disturbing, enormous order imbalance across all industries and 15-20% sell offs in Utility Stocks. Looks like a huge fleeing from risk assets of all kinds.
I have been accused of using too much verbage, but I am a professor, I have to talk. Its my job. Recently, I declared the start of a bear market in July, since then markets are down 15-20%. I predicted 500 point down days would come back in style. They did. I said quite directly SELL SELL SELL INTO ANY STRENGTH the markets are very vulnerable and still are.
Goldman Sachs sent a letter to the high valued net worth folks, here is there last paragraph from the many pages they sent to their best clients.
'In our view, this months volatility is a reminder of the importance of several principles of portfolio contruction, diversified sources of return matter. While we believe selloffs may create stock specific buying opportunities, an overreliance on equity markets may create vulnerabilities in vulnerable environments. INVESTORS SHOULD, IN OUR VIEW, CONSIDER STRATEGIES WHICH SEEK TO LIMIT DOWNSIDE EXPOSURE.
The last sentence was the punch line of multiple pages of verbage. I will translate it with what I have been saying for two months, SELL INTO ANY STRENGTH, cash limits your downside exposure 100%.
Buy this in the 40's anytime it plummets on vertical drop days in the markets, it is easy money.
Example: Buy at $40.75 yesterday, current price $43.75 = $3.00 gain in one day. This is better that an overprice mortgage reit.
The disillusioned "buy the dip" fools that always buy after a vertical drop in a broken market are out too lunch celebrating. The professionals who are still trying to raise cash by selling at good prices will come in. I believe the non-professional yield seekers in m-reits should do the same. Overpaying for yield in a new bear market is not a very sound strategy. SELL INTO ANY RALLIES FAST. Progressive vertical declines are forecast as order imbalances are quite apparent.
There are hundreds of reasons why the stock market should be crashing, but we shouldn't forget that powers in charge will try to continue the distortion to keep overvaluation high and shift reality to the backs of our minds hidden by the illusive sound of the financial media "The Markets Have Stabilized" "Stocks are Recovering". For now, the air pocket down or sharp aversion to risk this past week is an important indicator that the most well informed professional investors sold their stocks and raised cash with a passion. With no improvement in market internals that have become even worse, very similar to the environment seen before other major stock market crashed of 1987, 2000, 2009. After this vertical descent and a reflex rally of disillusioned fools will follow on any positive news or anything the press can paint as positive, like China's 1/4 pt. cut in its interest rates. If you really look at this factually, China stepped in and stopped the stock decline by closing the markets and hindered sell orders, devaluated its currency three times in 4 weeks, cut the interest rate yesterday, yet oil prices continue to slide, metals continue to slide to record lows, commodities continue to slide. All the vertical drops from major tops in the markets for the past 5 decades occurred with a vertical drop of 4-5 days followed by a very strong rally recovering 1/4 to 1/2 the drop. This time will be no different. It is typical behavior and is expected. I don't encourage anyone to sell against their beliefs, as long a you are aware of your risk exposure and happy with the resultant losses that can be tolerated. . If stocks continue to fall it will dampen investors appetite for risk and more vertical progressive down days along with Soc. Sec./ medicare near bankruptcy, public and private pension underfunded by $150 Trillion, trillion $ bubble in auto and student loans all we need is one more vertical drop to crush our illusions laying bare the man behind the curtain.
Are you looking for something to make money. I am in process of getting a list of asset managers (mutual fund managers) to short, these guys go down 90-95% in price at start of bear markets because they loose a lot of assets under management from people selling and going to cash and from stock prices crashing, so that assets under management drop faster than oil prices. I will then buy these after they are down 90%. This group always falls in Phase I of a bear market and go down 75-90%.
I am signing out today.
For the 20% plus yield. They just declared their dividend which is in tact and the stock was down 40% in the morning. I was riding the wave of positive news after the early morning sell off. There are opportunities galore where panic selling is done with positive news being released, all I had to do was wait for the percolator to warm up and the stock was back up. This is really really fun for me. But deep down inside I am praying for all the yield seekers who are getting hurt today, especially high yield bonds and bond like shares, which m-reits are in. Beward of m-reits, the bear hedge funds are looking for sectors that did not participate in the decline and they will bring these down in a determinant fashion. This is not about stochastic processes, we are in deterministic processes, prices will be determined by natural law or dogma of the great billionaire value group. Prices will drop until these folks with cash decide there is value there. Some of the stocks out there are toast, like Amazon, Twitter, social media, etc. Price to book, average low PE's in bear markets will determine the bottom.