I THINK THE MARKETS HAVE TOPPED

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BondTrader_IHB

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It's about time to start this topic,



Currently



S&P - 1092

Dollar Index - 76

Gold - $1060/ounce



My projection for the next 12 months, mainly based on technical indicators,



S&P - 700 or lower

Dollar Index - 85 or higher

Gold - $750/ounce



I'm in the deflation camp for at least the next 2 years.



Let the discussion begin....
 
I concur with you.



I think this market will try to squeeze another 1-2% out of this earnings season and it's back to reality.



I am thinking a 15-20% drop in 2010.



My favorite long term name at the moment is TBT.
 
So should we yank all of those wonderful earnings over the past few months just as we are beginning to get used to them again?
 
At lunch today one of our CPAs was all chipper about the Dow 10,000 and remarked "you must all be so revealed, how different this year is from last". No one said a word. All of us managing portfolios sat there stunned with looks of anxiety in our eyes. All of us were thinking 'yeah, just wait' but no one wanted to say it out loud. This time last year I felt like I was running a suicide hot-line. Not looking forward to doing that again.
 
<a href="http://www.zerohedge.com/article/dow-10000-oh-wait-make-7537">The DOW isn't "really" at 10,000</a>.



<em>Another great representation of the amazing loss of purchasing power by the US public are today's oblivious statements about the Dow at 10,000. While in absolute terms the Dow may cross whatever the Fed thinks is a necessary and sufficient mark before QE begins to taper off (Dow crosses 10k just as Treasury purchases expire), the truth is that over the past 10 years (the first time the DJIA was at 10,000) the dollar has lost 25% of its value. Therefore, we present the Dow over the last decade indexed for the DXY, which has dropped from 100 to about 75. <strong>On a real basis (not nominal) the Dow at 10,000 ten years ago is equivalent to 7,537 today!</strong> In other words, not only have we had a lost decade for all those who focus on the absolute flatness of the DJIA, but it is also a decade where the US Consumer has lost 25% of purchasing power from the perspective of stocks! You won't hear this fact on the MSM. </em>



http://i37.tinypic.com/vskphs.jpg

<em>

And if you want to be really scared, here is the comparable representation for the DJIA in ounces of gold. It cost about 30 ounces to buy the 10,000 Dow last time. Now it costs less than 10.</em>



http://i33.tinypic.com/28tuhy1.jpg



Hat tip to a fellow spider monkey for linking this.
 
[quote author="optimusprime" date=1255589082]I concur with you.



I think this market will try to squeeze another 1-2% out of this earnings season and it's back to reality.



I am thinking a 15-20% drop in 2010.



My favorite long term name at the moment is TBT.</blockquote>


Agree, S&P might get around 1200 by year end, just in time for holiday shopping season.
 
[quote author="graphrix" date=1255606979]<a href="http://www.zerohedge.com/article/dow-10000-oh-wait-make-7537">The DOW isn't "really" at 10,000</a>.



<em>Another great representation of the amazing loss of purchasing power by the US public are today's oblivious statements about the Dow at 10,000. While in absolute terms the Dow may cross whatever the Fed thinks is a necessary and sufficient mark before QE begins to taper off (Dow crosses 10k just as Treasury purchases expire), the truth is that over the past 10 years (the first time the DJIA was at 10,000) the dollar has lost 25% of its value. Therefore, we present the Dow over the last decade indexed for the DXY, which has dropped from 100 to about 75. <strong>On a real basis (not nominal) the Dow at 10,000 ten years ago is equivalent to 7,537 today!</strong> In other words, not only have we had a lost decade for all those who focus on the absolute flatness of the DJIA, but it is also a decade where the US Consumer has lost 25% of purchasing power from the perspective of stocks! You won't hear this fact on the MSM. </em>



http://i37.tinypic.com/vskphs.jpg

<em>

And if you want to be really scared, here is the comparable representation for the DJIA in ounces of gold. It cost about 30 ounces to buy the 10,000 Dow last time. Now it costs less than 10.</em>



http://i33.tinypic.com/28tuhy1.jpg



Hat tip to a fellow spider monkey for linking this.</blockquote>


This chart above is exactly the reason why i think that buying gold now is like buying a Woodbury home in 2005. Graphrix, last year we disagreed on practically everything, but this year you are putting up some good stuff!
 
[quote author="BondTrader" date=1255649017][quote author="optimusprime" date=1255589082]I concur with you.



I think this market will try to squeeze another 1-2% out of this earnings season and it's back to reality.



I am thinking a 15-20% drop in 2010.



My favorite long term name at the moment is TBT.</blockquote>


Agree, S&P might Qget around 1200 by year end, just in time for holiday shopping season.</blockquote>


LOL!



BT, I hope you are right about S&P 1200 by year end, because i still need to liquidate Mama Panda's Chinese stocks.
 
[quote author="PANDA" date=1255671388][quote author="BondTrader" date=1255649017][quote author="optimusprime" date=1255589082]I concur with you.



I think this market will try to squeeze another 1-2% out of this earnings season and it's back to reality.



I am thinking a 15-20% drop in 2010.



My favorite long term name at the moment is TBT.</blockquote>


Agree, S&P might Qget around 1200 by year end, just in time for holiday shopping season.</blockquote>


LOL!



BT, I hope you are right about S&P 1200 by year end, because i still need to liquidate Mama Panda's Chinese stocks.</blockquote>


LOL, China is around 3000 again, get ready to push that sell buttom. My confidence on the S&P 1200 aint too high, but 1120 is very likely, so not much room on the upside anyways. Dollar is getting close to 75, I'm one of those 2-3% people out there who are bullish on dollar.
 
[quote author="BondTrader" date=1255672023][quote author="PANDA" date=1255671388][quote author="BondTrader" date=1255649017][quote author="optimusprime" date=1255589082]I concur with you.



I think this market will try to squeeze another 1-2% out of this earnings season and it's back to reality.



I am thinking a 15-20% drop in 2010.



My favorite long term name at the moment is TBT.</blockquote>


Agree, S&P might Qget around 1200 by year end, just in time for holiday shopping season.</blockquote>


LOL!



BT, I hope you are right about S&P 1200 by year end, because i still need to liquidate Mama Panda's Chinese stocks.</blockquote>


LOL, China is around 3000 again, get ready to push that sell buttom. My confidence on the S&P 1200 aint too high, but 1120 is very likely, so not much room on the upside anyways. Dollar is getting close to 75, I'm one of those 2-3% people out there who are bullish on dollar.</blockquote>


Thank for the heads up BT. I am going to call Mamma Panda and her broker tonight to put some money off the table.



Hey I'm confused. Why does the Shanghai index show 3200 in Bloomberg, but 3000 in CNBC's website. Which one is correct?
 
Panda, awhile back were there not quite a few folks in here ganging up on you for buying gold and saying you did not know anything about investing? For someone who does not know anything, you seem to have been right, and they were wrong.
 
Is the market not going to celebrate "better than expected" results anymore? IBM posted a solid profit and outlook beat after market close and got hammered AH for a decline in sales.



I thought BT was crazy calling a market top before Goldman reported earnings, but it does look like some of the euphoria is wearing off.



I'm even starting to read articles in the MSM about lots of traders expecting a really bad 2010, but too scared to get out of the market right now.
 
[quote author="BondTrader" date=1255672023][quote author="PANDA" date=1255671388][quote author="BondTrader" date=1255649017][quote author="optimusprime" date=1255589082]I concur with you.



I think this market will try to squeeze another 1-2% out of this earnings season and it's back to reality.



I am thinking a 15-20% drop in 2010.



My favorite long term name at the moment is TBT.</blockquote>


Agree, S&P might Qget around 1200 by year end, just in time for holiday shopping season.</blockquote>


LOL!



BT, I hope you are right about S&P 1200 by year end, because i still need to liquidate Mama Panda's Chinese stocks.</blockquote>


LOL, China is around 3000 again, get ready to push that sell buttom. My confidence on the S&P 1200 aint too high, but 1120 is very likely, so not much room on the upside anyways. Dollar is getting close to 75, I'm one of those 2-3% people out there who are bullish on dollar.</blockquote>


BT, didn't want to take any chances. I just liquidated Mamma Panda's entire Asian portfolio today.



P-
 
[quote author="awgee" date=1255687260]Panda, awhile back were there not quite a few folks in here ganging up on you for buying gold and saying you did not know anything about investing? For someone who does not know anything, you seem to have been right, and they were wrong.</blockquote>


You could make the same argument about equities right now. There is no reason for gold to be this high other than fear. It is a fine trade so long as you get OUT before it turns around on you.



I knew several pepole who were worth several million dollars in the early 1980's (I was a little kid at the time). I'd estimate 75% of them went busto because they overstayed thier welcome in the market. If Panda can pull this off, he's a much better trader than I'll ever be. If not, well, the world needs ditch diggers too.
 
I think I read something once about a famous economist during the Great Depression who made a fortune betting the stock market would tank. He ended up losing it all when he turned bull a few years too early.
 
My guess that is that the S&P stalls out between 1120 and 1200. I just can't see the market having a correction this year, too many people's bonuses are dependent on the market staying at current levels or going higher. When we get into 2010, I think you will see big profit taking. If the economy does continue to pick up and the recovery is real, I don't think the S&P will go below 1000....if the economy has a "W" shaped recovery....LOOK OUT BELOW.
 
[quote author="Daedalus" date=1255702172]I don't think there is a letter in the alphabet you'll be able to use to describe this "recovery".</blockquote>


The "square root" symbol... upside down.



<img src="http://www.accucut.com/stores/5//imagesstoreimages/Dies/std_shapes/s1009.gif" alt="" />
 
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