D...Do...Dow...Down

[Nbadan]

Dow 12,589.07 -238.42
Nasdaq 2,440.51 -58.95
S&P 500 1,390.18 -26.00
10 YR 3.84% 0.00
Oil $96.33 $1.24
Gold $880.30 $18.30

DJIA and S&P four-month lows obliterated.

Might start getting really ugly now....

Meanwhile, the Dow Jones Industrial Average is also on shaky footing, but the blue-chip barometer hasn't yet broken down completely.

With last week's losses, the Dow sold off from a three-month downtrend, violating its major moving averages.

Again, the Dow bottomed Monday at 12,733 -- just 10 points under major support -- before recovering, rising modestly to close at 12,827.

A decisive break under the 12,743 November closing low would likely signal a primary trendshift.

Market Watch

Really....there's nothing left for the current administration to do but keep printing dollars at record rates...the economy is slowing driven by the housing slump and credit crunch, and unless Uncle Sam finds a way to give billions of dollars to consumers for free, we could be looking at a sharp period of further price deflation in 08.....and lower and lower, market-driven interest-rates....and record federal deficits....

[Wild Cobra]

I am tired of useless fear mongering only using effect with no valid cause, allowing wild speculation. Dan, so you have any scruples?

Again, people with money are moving money around. That does not mean we are hurting. The markets will recover... Unless... it looks like a democrat will take the White House in 2008, but that's still to far away o affect anything now.

The real value of the stocks are sitting good. Watch out when too many stocks start getting P/E numbers around 20 or so. As long as most stocks are at 15 or lower on the P/E, the markets should be fine for the moderate future.

[Wild Cobra Kai]

The markets will recover... Unless... it looks like a democrat will take the White House in 2008, but that's still to far away o affect anything now.

Yeah, those Democrats ruin the markets, all right. That ing Clinton knocked the DJIA all the way down from 3500 to 11000.

[Wild Cobra]

Yeah, those Democrats ruin the markets, all right. That ing Clinton knocked the DJIA all the way down from 3500 to will have maket failres. er11000.

We had a republican congress.

If congress and the white house are controlled by the liberals, yes... we will most definate have market problems.

[Wild Cobra Kai]

We had a republican congress that had an obsessive, prurient interest in the POTUS's sex life.

FIFY

[SouthernFried]

Most Business types fear Democrats. Talk about renigging on the tax cuts, and increasing taxes more. And the markets look 6-9 months out. What they see right now is McCain and Obama winning early primaries. McCain voted to end the tax cuts, and Obama wants to increase taxes. This kills the market.

But, I think it has more to do with Countrywide bank stating "No, we are not going bankrupt" today. The fact they had to say it, shows what everyone else has been thinking for awhile.

And just so people know, the whole world has had market shortfalls recently. European markets are down like 8-10%, Japan Markets are down around 15%. What has not been mentioned in all of this, is how we've had record economic growth for the last 5 yrs. Totally ignored for the most part.

The media is a tool...and a mostly ignorant one at that. Always has been in my lifetime.

It's always a cycle. Up, down, up, down. And when it's politically expedient, down trends are usually portrayed as the world coming to an end...and up trends are generally taken credit for.

In reality, business only regards government when it interferes in the marketplace. So, when the markets see increase taxation policies coming from the leading 2 candidates...it cringes.

sig

[BonnerDynasty]

Cheaper shares ftw.

[Wild Cobra]

Cheaper shares ftw.

Do you mean "for the wise?"

I agree.

When the markets dropped in 2001, my next door neighbor was panicking about the value of his 401K. He's about may age, and will still be contributing to retirement for some years still. I told him it would help him more than he realizes, and if he wasn't contributing the maximum, to do so. I told him as the share prices drop, he is buying more shares every payday, that the markets will rise again and pay him off big. Sure enough, once the markets came up again, he thanked me. He almost stopped contributing! He was so happy as the value of all those cheap shares rose in value.

[BonnerDynasty]

For the win.

[Nbadan]

For the losers..

U.S. stocks sink on write-downs in financials
B. of A. seals deal for Countrywide; J.P. Morgan reportedly eyes WaMu

NEW YORK (Marke ch) -- Stocks dropped steeply Friday, with the Dow headed toward its most dismal first-eight-trading-days-of-a-year run in 17 years, as write-downs and slashed earnings forecasts signaled slowing consumer spending and sparked increased talk of a recession.

"From an earnings perspective, we're already in recession," said Jack Ablin, chief investment officer at Harris Private Bank.

The major indexes fell to new session lows after a top Federal Reserve official said investors have been too focused on individual interest-rate cuts rather than the overall direction of monetary policy. See full story.

The Dow Jones Industrial Average broke through to new session lows, falling more than 250 points, after Fed Gov. Frederic Mishkin spoke in New York.

Market Watch

[Spurminator]

This was a great time to roll over my 401K, especially with insufficient do entation that will delay the processing of my rollover check.

[Nbadan]

Consumer confidence fell to an all-time low as worries about jobs, energy bills and home foreclosures darkened people's feelings about the country's economic health and their own financial well-being.

According to the RBC Cash Index, confidence tumbled to a mark of 56.3 in early January. That compares with a reading of 65.9 in December -- and a benchmark of 100 -- and was the worst since the index began in 2002.

CNBC

[Aggie Hoopsfan]

I'm glad I got in on a bunch of gold funds at the start of last year

40% gain since January of last year.

[Wild Cobra]

I'm glad I got in on a bunch of gold funds at the start of last year

40% gain since January of last year.

Good deal. You know they can drop in value like a lead weight when they start falling, right?

Hope you sell them when the time is right.

[Wild Cobra Kai]

Good deal. You know they can drop in value like a lead weight when they start falling, right?

Hope you sell them when the time is right.

While gold is at a record high, dollarwise, if you adjust to today's dollars, the 1980 record price would be somewhere between $2115 and $2200 per troy ounce. It took three years, and the forcing of interest rates up into the mid teens by the Reagan administration for that price to drop back to previous levels. That's some pretty good lead times and signs to get out or reduce your holdings.

[Wild Cobra]

While gold is at a record high, dollarwise, if you adjust to today's dollars, the 1980 record price would be somewhere between $2115 and $2200 per troy ounce. It took three years, and the forcing of interest rates up into the mid teens by the Reagan administration for that price to drop back to previous levels. That's some pretty good lead times and signs to get out or reduce your holdings.

Yes, the inflationary factor is real, but I don't think gold will ever see such relative highs again.

I say the timeframe will be fast because he reason for gold rise today is different than back then. The price is over inflated because it is the latest fad and hyped up. There are some good reasons to invest in gold right now. Just be cautious because the US markets are far from being in any bad shape, and when they look good again, money will pour back into them. Investors will sell gold so fast, it will drop hard.

Disagree all you want. This is obvious speculation, but from experience. Not from what others are saying. I see time as showing my prediction correct. I'm just not going to predict how soon, just that it won't be a real long time. I don't make such predictions often, or lightly. I seriously believe this.

Gold isn't a money standard anymore, and it's value is a supply and demand situation. Again, the hype, more people want gold, hence the higher value. Again, when other places to park money are better, gold will drop. Not being a stock, it doesn't have the same safeties built in to keep it from crashing.

Normally I wouldn't explain so mush to a childish wise ass like yourself, but others read this too.

You deserved losing to the Karate Kid.

[BradLohaus]

You were pretty hard on Cobra Kai, WC, but he's right. The extreme measures that were required in the early 80's are completely unthinkable today. A double digit rate from the Fed? Impossible. They've adopted a new tactic today - absurd, bordering on Orwellian lies about the true inflation rate.

The price is over inflated because it is the latest fad and hyped up. There are some good reasons to invest in gold right now. Just be cautious because the US markets are far from being in any bad shape, and when they look good again, money will pour back into them. Investors will sell gold so fast, it will drop hard.

The price of gold and other commodities today is no fad. The gigantic explosion in the supply of dollars over the past years is by far the main cause. Unlike Volcker's Fed, Bernanke shows no signs whatsoever of letting up. And it doesn't matter if the Dow goes up in the future; it's been going up for the last 5+ years - but not equal to the rate of gold. The reason is simple; it's inflation caused by artificially low interest rates originating from the Fed.

Gold isn't a money standard anymore, and it's value is a supply and demand situation. Again, the hype, more people want gold, hence the higher value.

It always was supply and demand; the market determined that gold is money thousands of years ago. A little over 30 years of government fiat can't and hasn't changed that. The explosion in the supply of fiat paper has caused the higher price of gold and other commodities - not hype.

Again, when other places to park money are better, gold will drop. Not being a stock, it doesn't have the same safeties built in to keep it from crashing.

The safety net that keeps the Dow from crashing is the same mechanism that keeps commodity prices surging - liquidity from the central bank.

[johnsmith]

I love the way Dan and others subtly celebrate this stuff happening. I can just picture him at his computer and reading about the Dow, laughing out loud and thinking, "it's perfect, d....do...dow....down.........BWAHAHAHAHAHAHA, all the readers at spurstalk are bound to see the play on words".

[boutons_]

There are a lot of WC's fear mongers out there who can't find "valid cause" for concern:

http://www.cnbc.com/id/22637906

http://www.huffingtonpost.com/huff-w...ecession-odds/

There's the ARM resets in 08/09 (which is separate from the sub-prime crisis),
the explosion of credit card debt not offset by earned income increases,
and
credit card defaults,
etc, etc.

dubya/ head/neo- s have been duplicitously fear-mongering 'with no valid cause" since 9/11, didn't seem to bother WC.

[Aggie Hoopsfan]

dubya/ head/neo- s have been duplicitously fear-mongering 'with no valid cause" since 9/11, didn't seem to bother WC.

[BradLohaus]

Here's an interesting article that talks about the price of Manhattan apartments in terms of gold compared to dollars:

Gold Value of Apartments Sinks
New Reports See e in Dollar Terms
http://www.nysun.com/article/68830

Don't miss the graph:
http://www.nysun.com/pics/68830.jpg

The value of apartments in Manhattan is plummeting, even as the price of apartments in dollar terms has, according to several reports by real estate firms, soared to record highs.

The average value of a Manhattan apartment over the past six years has plunged nearly 39%, to 1,727 ounces of gold, even as the average dollar price of an apartment in Manhattan over the same six-year period has nearly doubled to $1.4 million, according to figures in several real estate reports published today for the fourth quarter of 2007.

[Wild Cobra]

You were pretty hard on Cobra Kai, WC, but he's right.

Yes, I was intentionally hard on the mother er for two reasons. He change my name in the quote to "mini me" and created his screen name just to spite me.

I take deep personal offense to the asshole.

As for the rest of it, we are all speculating the future, and have no crystal ball. Time will tell, I and feel my prediction is the best.

[BradLohaus]

I wonder who WCK really is. Whoever it is, he reads Bill Simmons - the Karate Kid articles are some of The Sports Guy's best work.