The markets started off low and began slowing paring its losses and working its way up, only to get beaten back down with increased selling during the last 20 minutes of the day before the market closed.
This marks an interesting turn of events- could the
FM's grip be weakening in its power to maintain the illusion that all is well?
Of course many talking heads on TV were doing their best to put on a positive spin on the selling.
Maria, Kudlow, and Cramer, were quite "Bullish", or I should say were spouting their "Bull" that buying opportunities are great now. Despite their "buy buy buy!" mantra, the market continued to go down.
Here's a good question to ponder- these folks are so good at telling people that this is a great buying opportunity and that folks should be buying, but why are these same people non-existent when it comes to giving out "selling opportunities" announcements and warning people when we are near a top?
The answer is obvious- warnings to sell and stock downgrades are bad for business since that means people will leave the market, stocks will fall and corporations will lose money. Therefore it makes more sense business wise to be more bullish rather than bearish when giving news out to the public. Warning signs are casually ignored or dismissed as not important enough to worry about. Any folks they allow on to give warnings are met with heavy skepticism and seen as being out of the loop with reality.
This results in the general public never receiving a timely warning to protect themselves against market sell offs. This is why it's so important to NOT rely on what any of these talking heads are saying on TV and to do your own homework and research when it comes to investing. If you are fortunate enough to find an investment firm that will properly manage your money and knows what they are doing, you can go that route as well.
Things are getting interesting now in that the Fed's magic bullet of rate cuts don't appear to be having the effect they would like and in fact have had negative consequences like rising commodities and oil along with the dollar falling to new record lows everyday. The Fed has already said that there will be NO rate cuts in December, so if they don't go back on their word, the market will finally start having to take its long overdue medicine.
Even with the downdraft this past week, we have the following:
Dow- ~8% off its record high.
NASDAQ ~6% of its high for the year.
S&P 500- ~7% off its record high.
People may like to scream and panic over this, but so far this doesn't even qualify as a correction yet. A correction is generally held to be a market drop of at least 10%, with a Bear market noted by a drop of at least 20%.
It's apparent that the market and people in general have become so lop-sided that they think the market can only go one way and are shocked and dismayed when they learn that surprise, markets can fall as well.
The funny part is we as humans repeat the same mistakes over and over with market bubbles and busts. Be it tulips, gold, dot coms, housing, credit, etc..., the pattern is always the same- Products are bid up through a buying frenzy and rush to get in to make some "easy money". Eventually the market runs out of new buyers and prices collapse rapidly when selling turns into panic selling and folks rush towards the exits.
Comments (4)
Although Cramer doesn't seem like the type to care about PC-ness does he?
http://www.xanga.com/SoullFire/610888033/watch-out-for-the-wolves.html