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BigBlock
Posted : Wednesday, August 27, 2008 10:11:45 PM
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Ok lets continue the thread...

___________________________________

BIGBLOCK

A broad look of the tecnicals as well as fundamentals shows no bottom for this bear market.
NO higher high or higher lows have been achieved, and none of the retracement carried any kind of exciting attention. Those retracements which a like to call up retracement since we are in a well established down trend, are part to the trend as fluctuations must occur.
This last rally may have still a little way to go, but nothing to worry about.
IN looking at the current chart of the DOW



It seems that the 10,700 level is just around the corner.  In fact much longer time frames show that the 7,500 level is not out of the question.
In a 60 day time frame the Stochastic shows just halfway through the correction, which indicate a possible target of 8400 before an oversold level is achieved.  Certainly if we reach those levels you are going to see some real panic and the posibility of further decline.
Realize, and I will say this again, that no changes has been made to the fundamentals.  The banking system is in trouble, and there is no easy fix on that.  But of course that is not the only thing pulling this markets.
One important issue that I believe is being overlooked  by the markets is the Russia situation.  Too much distraction wth the olimpic games, end of summer, and the mess with Fannie and Freddie.  Even the Oil futures fail to react due to the fact that South Ossetia is not sitting over any pool of Oil.  
The markets have focus more on the inevitable bailout of FRe and FAnn, and not enough on the repercutions that this Russia situation may have on future relations with Europe, and more specificly on how to establish a connection to Vladimir again.
Remember what happen in 1991 with Gorbachev, after the treasure mess and the hurricane mess.  All was recover except for Gorbachev.
This is opening a major hole in relations between east and west, and that will affect not just the economic health of Europe, but also the major foreign policies of global powers as well as global markets.
Russia was out of everyones mind, and now in just 2 weeks things have changed quickily.  This is already affecting conditions in Iraq, and Alghanistant, as well as the presidency campaign.  This is as of now a third front in our foreign policy.
This will not be ignored by the markets in times to come as this will impact emerging, debt, currency, commodities markets and any other market you can think of.
The circustances are clearly on the table, and I personally think they are not going to go away.  Russia knows well what is at stake, and they have been quite too much too long. 
How Russia play its hand will play a critical factor for all affected parties - Energy as well as oil could be a real threat to Western Europe already swamp with rampant inflation.
No matter what  - When markets have ignored circustances like those with Russia in the past, at the end the reality hits like a brick on the face - an ugly scene.
This will come into play later as a negative to US markets added of course to the ongoin mess already in place. 

---------------------------------------------------------------------------
BIGBLOCK

Berkshire Hathaway will not bet agains the dollar, and Warren Buffet said clearly today that the economy will not rebound before 2009.  I think more like 2010.
Anyways he saids that the credit crunch among other things will continue to worsen. and furthermore noted that the FED Bernake has no "magic wand" to change give the economy a boost or lower inflation.
And to end he alleged that the nation could be facing economic disaster if it doesn't ge a handle on its growing debt.

I think there is still a little more room for shorts.

--------------------------------------------------------------------------------------
ALLENBARY

If I remember correctly this bear market rally started with hedge funds covering naked shorts to meet the new requirements from the feds.  Nothing has changed that started the bear growling. Housing market and financials are still in bad shape, and getting worse. I see a greater potential for downside than up. So I will stay focused in short selling for now.  AB      

-------------------------------------------------------------
BIGBLOCK

Yes Allenbary you are correct.  In fact,  Warren Buffet just yesterday said that wallstreet has been like a nudist beach, and that when you go swimming naked and the tight comes down you can alway see who hasn't been covered.  They are all trying to get covered now, and they are burning so much cash to cover payouts, that soon they are going to be in ruins.  But is a little too late, now they have been exposed.
Staying on the short side will definately increase your odds of making profits dramatically.  It makes no sense to want to go long against a well established downtrend of the general markets.

Take care.

----------------------------------------------------------------
BIGBLOCK

Well even the FED agrees now - at their retreat at Jackson Hole the "economists" gathering say that there is no quick fix and that the economy has a long "long" way to go before recovery.
Did they really have to go to Jacksong Hole to come up with such lame statement.

The funny thing is that Feldstains say they have no clue where the lift is going to come from.
I surely agree with them that US will go into a recession  lasting as any post war history, which on the average has been 16 moths (remember mid 1970's, and early 1980's).
The thing to consider is how bad things are already, and with 16 month to go - those are going to be a long long 16 months for lots of folks.'

Cosumers are already getting toasted, and so will corporate soon after they run out of cash (business sector will roast), and so world growth will start to limp soon after.  
Then gravity will exercise its power and a new economy will surge.

-------------------------------------------------------------
SHARPOLLY
 Fridays rally was a bit weak, IMO, I have to say.  Recent rally trendline was punctured and 50EMA held on friday.  I think a monday pullback will start another leg down.  I see the bottom being 9600-9800, not including the final scare- the- crap- out- us -blowout -bottom where the big dogs generally cover thier shorts and go long.


-------------------------------------------------------
BIGBLOCK

This coming week keep your eyes on the financials, and housing data.  Freddie and Fannie will probably be arranged, and of course Lehman Bros are still in the air. Good thing the market is still out on vacation.
When it returns there is going to be a lot of hair pulling.

-------------------------------------------------------
SCOTTNLENA

QUOTE (BigBlock)

Well even the FED agrees now - at their retreat at Jackson Hole the "economists" gathering say that there is no quick fix and that the economy has a long "long" way to go before recovery.
Did they really have to go to Jacksong Hole to come up with such lame statement.

The funny thing is that Feldstains say they have no clue where the lift is going to come from.
I surely agree with them that US will go into a recession  lasting as any post war history, which on the average has been 16 moths (remember mid 1970's, and early 1980's).
The thing to consider is how bad things are already, and with 16 month to go - those are going to be a long long 16 months for lots of folks.'

Cosumers are already getting toasted, and so will corporate soon after they run out of cash (business sector will roast), and so world growth will start to limp soon after.  
Then gravity will exercise its power and a new economy will surge.



Time and paitence.  I've got both.
Man.. people a cooking now.  I have a neighbor that is an "investor"... they don't do anything crazy or foolish like trying to time the market, or move to cash, or look at emerging new sectors.  They trust their advisor who has been calling them this past several months to let them know "he's picking up some great bargains" for them.

boggles my mind how people can swallow that hook line and sinker.

---------------------------------------------------
BIGBLOCK

Great business for the advisor.  About the bargains that is to be seen.
Ask them if the advisor offers them any guaranties.


----------------------------------------------------
BIGBLOCK
Russias decisions today, are just pay back for US support to Kosovo.
The Geopolitical landscape has been changed as a consequense.  This will have repecusions (well it is already having)at a global level, and on global markets. 

-------------------------------------------------------

NOW WE CAN CONTINUE THE THREAD. 

Craig_S
Posted : Thursday, August 28, 2008 6:34:14 AM


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I came here to show you what it is like to be verbaly abused

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allenbary
Posted : Thursday, August 28, 2008 12:20:02 PM
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Imo the looming Hurricane in the gulf will likely drive up oil prices next week adding weakness to a poor economy should make for good shorting opportunities in the oil and gas sector. AB  

funnymony
Posted : Thursday, August 28, 2008 5:36:04 PM

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QUOTE (allenbary)

Imo the looming Hurricane in the gulf will likely drive up oil prices next week adding weakness to a poor economy should make for good shorting opportunities in the oil and gas sector. AB  



apparently the market saw it your way today, although these sector seems too beaten up to be a shorting opportunity.
BigBlock
Posted : Thursday, August 28, 2008 8:38:35 PM
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I agree, to this date this is a well established downtrend.  There will be fluctuations as always, but again the primary downtrend is still down.  
As soon as I get a chance I will bring up illustrations base on Elliot which support the especulation that this is just the beginning of much longer downtrend.

Also keep in mind that strength on the dollar at this time is a negative of our economy as it will shut down exports.  Buffet just said he surelly will not bet against it.

funnymony
Posted : Friday, August 29, 2008 10:03:49 AM

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QUOTE (allenbary)

Imo the looming Hurricane in the gulf will likely drive up oil prices next week adding weakness to a poor economy should make for good shorting opportunities in the oil and gas sector. AB  



winding up for a move.

realitycheck
Posted : Friday, August 29, 2008 6:30:53 PM
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QUOTE (BigBlock)

Also keep in mind that strength on the dollar at this time is a negative of our economy as it will shut down exports.  Buffet just said he surelly will not bet against it.



Exactly !!!

The exports that resulted from the cheap USD were the saving grace in the Q2 GDP data ... it will fade fast in Q3 ...

And as far as Buffet goes ... he is not much of a currency trader ... those that are ... like Rogers and Soros ... are betting against the USD longer term ...

However ... history has shown us that as fundamentally flawed as our own currency is ... the world continues to run toward it in times of global economic turmoil ...

BigBlock
Posted : Friday, August 29, 2008 9:20:54 PM
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It is unveliabable that the govenment tells us that GDP was up over 3% last quarter.  Come on folks!  What kind of magic is that?  black magic?
Today was announced the collapse of the 10th bank (Georgias's Integrity bank) taken by the FDIC.
Sarcastic ah!  INTEGRITY bank.
On the same pace, GM is now requesting bailout from the government.  They say they deserve it.
So Fanny, and Freddy on their knees, GM begging, housing in a slump, inflation eating us alive, Deficit never worse, personal debt out of control, healthcare in crisis, and consumer confidense down in the curve, unemployment up and up, and .... I could go on all night.
How did this magic GDP happened?
Maaay yy be is the goldylocks economy back on track! Just kidding folks.
but surely this must be a mistake or a bad taste joke.

BigBlock
Posted : Friday, August 29, 2008 10:19:07 PM
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The first 5 wave of an Elliot analysis.  The new wave 1 should complete another cycle, which in turn will become to be wave 3 of a larger cycle of waves. Well I am sure you know Elliot.  If not please google "Elliot Wave".

Like I said originally, I wouldn't rule out the 8500 level.  Don't worry it will not come tomorrow, but through the proper cycles and if left to work by itself we may very well get there.
I initially targeted wave to the 9500 level, but it didn't take it that low.  None the less this last 1 wave is longer than the original 1 as it is suppose to be.

realitycheck
Posted : Friday, August 29, 2008 10:22:05 PM
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And let's not forget that the FDIC's watchlist ... those banks with a Tier 1 capital ratio falling below 6 ... increased to 117 this quarter from 90 last quarter ...

The FDIC may ask the Treasury to underwrite their losses ... as some analysts are projecting 110 bank failures by next July totaling $850 BILLION dollars ... or about 8 times the reserves of the FDIC ...

Should be interesting ....

driger
Posted : Friday, August 29, 2008 10:59:41 PM

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QUOTE (BigBlock)

The first 5 wave of an Elliot analysis.  The new wave 1 should complete another cycle, which in turn will become to be wave 3 of a larger cycle of waves. Well I am sure you know Elliot.  If not please google "Elliot Wave".

Like I said originally, I wouldn't rule out the 8500 level.  Don't worry it will not come tomorrow, but through the proper cycles and if left to work by itself we may very well get there.
I initially targeted wave to the 9500 level, but it didn't take it that low.  None the less this last 1 wave is longer than the original 1 as it is suppose to be.





Just look at the head and shoulders you have there. head peaks just about 14,000 with the neckline @12000. So 14,000-12,000=10,000.
BigBlock
Posted : Friday, August 29, 2008 11:35:57 PM
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driger I must disagree.  When it is all said and done, I see the index way below 10,000.  Just by fundamentals we should be way below there already, but the government is doing all possible tricks to keep it up.  Well "tricks" - just realize that for example every bailout allowed by the government is the same as to say - ok we just have the tax payers pay for your mistakes.  That is an easy way out don't you think.  
Eventually it will have to stop, and then what are they going to do.
Markets are best to cycle themselves out, but they are not being left alone to do so. 
Regardless I especulate much lower than 10,000 before the start of a new bull market.
BigBlock
Posted : Friday, August 29, 2008 11:38:54 PM
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Below is a neat chart of investor phychology.  I estimate at the dismissal / denial on the right side of course.  I have seen no real fear or panic just yet.

driger
Posted : Saturday, August 30, 2008 1:19:46 AM

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QUOTE (BigBlock)
driger I must disagree.  When it is all said and done, I see the index way below 10,000.  Just by fundamentals we should be way below there already, but the government is doing all possible tricks to keep it up.  Well "tricks" - just realize that for example every bailout allowed by the government is the same as to say - ok we just have the tax payers pay for your mistakes.  That is an easy way out don't you think.  
Eventually it will have to stop, and then what are they going to do.
Markets are best to cycle themselves out, but they are not being left alone to do so. 
Regardless I especulate much lower than 10,000 before the start of a new bull market.



Not sayin we won't go lower just that the next logical target is @10,000.
BigBlock
Posted : Monday, September 1, 2008 11:35:37 PM
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Sure Drigger, there will be a lots of fluctuations and supporst to break between here and then.
BigBlock
Posted : Wednesday, September 3, 2008 11:12:55 PM
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Just finished watching the speech from Palin.  I tell you if we get an administration based on the show I just watched this country is headed for catastrophy.
What a bunch of fakes to say the least. 
driger
Posted : Thursday, September 4, 2008 12:46:34 AM

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QUOTE (BigBlock)
Just finished watching the speech from Palin.  I tell you if we get an administration based on the show I just watched this country is headed for catastrophy.
What a bunch of fakes to say the least. 


humorous, the gop talks about her like shes the best thing since lincoln.
BigBlock
Posted : Thursday, September 4, 2008 5:20:41 PM
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Well this beautiful candle of (-344,65) today may just put the market back on the trail to reality.
Nice day today.
funnymony
Posted : Thursday, September 4, 2008 5:44:07 PM

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QUOTE (BigBlock)
Well this beautiful candle of (-344,65) today may just put the market back on the trail to reality.
Nice day today.


support break on good volume, definite sell signal today.

althought the mclellan summatin hasn't broken down yet, but the vix is poppin.
bknight
Posted : Thursday, September 4, 2008 9:27:44 PM
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QUOTE (funnymony)
QUOTE (BigBlock)
Well this beautiful candle of (-344,65) today may just put the market back on the trail to reality.
Nice day today.


support break on good volume, definite sell signal today.

althought the mclellan summatin hasn't broken down yet, but the vix is poppin.


Since the McClellan Summation Index is a simple addition of the daily Oscillators that are calculated on two moving averages (39 and 19), you will never get immediate responses.  However, the Oscillator did turn negative for the second time in a the last two weeks, it may roll over and head back to negative territory,
I listened carefully as some were estimating if we have another high volume decline as we had today, the bottom "may" be in.  I suspect the bottom will likely have a -3000 handle on the Summation Index.
funnymony
Posted : Thursday, September 4, 2008 11:35:45 PM

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QUOTE (bknight)
QUOTE (funnymony)
QUOTE (BigBlock)
Well this beautiful candle of (-344,65) today may just put the market back on the trail to reality.
Nice day today.


support break on good volume, definite sell signal today.

althought the mclellan summatin hasn't broken down yet, but the vix is poppin.


Since the McClellan Summation Index is a simple addition of the daily Oscillators that are calculated on two moving averages (39 and 19), you will never get immediate responses.  However, the Oscillator did turn negative for the second time in a the last two weeks, it may roll over and head back to negative territory,
I listened carefully as some were estimating if we have another high volume decline as we had today, the bottom "may" be in.  I suspect the bottom will likely have a -3000 handle on the Summation Index.



ya, i think if the market rallys and summation continues to decline and rolls over, that will confirm the sell signal.
tllucero
Posted : Friday, September 5, 2008 10:36:00 AM
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Looks like the real economy beginning to show recession. Dow 8000 looks like a reasonable target, but my perverted sense wants 3686, for historical reasons.

Trillion dollar fed budget deficits as far as the eye can see, with oil *not* king. From credit crunch to credit contraction. It's been a long time since we've seen a deflationary depression. I'm thinking it will end in most major currencies in hyperinflation; can't really see any other outcome. Social security, Medicare, baby boom retirements all out the winodw.

Money returns to its rightful owners in a recession. In a depression, the music stops, and we all grab chairs on the Titanic. Or something similar...
BigBlock
Posted : Friday, September 5, 2008 12:12:18 PM
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Today in major headliners "FED is powerless against this recession" - payroll data is further evidence of US contraction.  
OPEC meets again next week to deal with the rollacoster reflected in oil prices.  It is my opinion that they are going to get their fingers caught regardless of what they do.  And as a consequence they eventually are even going to be blamed for the global slow down.
BigBlock
Posted : Friday, September 5, 2008 12:46:42 PM
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Lucero interesting remark.  I am think the possibility of 3600 on the dow is more than doubtfull, but you know there is always a slight possibility.  I speculate that a level of 7500 is a much stronger possibility, althought once we are at those levels who knows what may happen.  I think that is the current economic conditions would had be present in the last bear the outcome would had been substantially lower

realitycheck
Posted : Friday, September 5, 2008 2:01:54 PM
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Bigblock ...

I find your chart note "major support from one the greatest bear markets" interesting ...

How do you quantify that ?

Percent decline from peak to trough ?

Time to recover to old highs ?

funnymony
Posted : Friday, September 5, 2008 2:45:12 PM

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QUOTE (realitycheck)

Bigblock ...

I find your chart note "major support from one the greatest bear markets" interesting ...

How do you quantify that ?

Percent decline from peak to trough ?

Time to recover to old highs ?




i'm sure bigblock has his own explanation, but,
i guess if you consider the nasdaq dropped 90%, it was a pretty big bear.

also, technically, i don't think the bear ever ended. we just ended a cyclical bull within a secular bear.
BigBlock
Posted : Friday, September 5, 2008 5:06:48 PM
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QUOTE (funnymony)
QUOTE (realitycheck)

Bigblock ...

I find your chart note "major support from one the greatest bear markets" interesting ...

How do you quantify that ?

Percent decline from peak to trough ?

Time to recover to old highs ?




i'm sure bigblock has his own explanation, but,
i guess if you consider the nasdaq dropped 90%, it was a pretty big bear.

also, technically, i don't think the bear ever ended. we just ended a cyclical bull within a secular bear.


Funny I understand what you are trying to say from a technical point of view.  You are correct the Nasdaq never made a higher high, and so technically it is still under the water from the last bear drop.
On the other hand if you apply the same study to the Dow things are different as the dow went to higher highs, and sure there different reasons why that happened.
What is important is that in my opinion the fundamentals valuations of the markets as well as the economic conditions of this markets are set for further catastrophic declines that we had in the last bear as they stand right now, and I think that litle can be fixed at this point.
You know a technology bubble is one thing, but when the bubble hits your banking system that is a whole diferent animal.

Take care
BigBlock
Posted : Friday, September 5, 2008 5:14:56 PM
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QUOTE (realitycheck)

Bigblock ...

I find your chart note "major support from one the greatest bear markets" interesting ...

How do you quantify that ?

Percent decline from peak to trough ?

Time to recover to old highs ?



reality I am not sure I fully understand the context of your questions - can you rephrase and be more specific.  For example "from peak to trough" which peak?  which trough?

Take care
mjhorn16234
Posted : Saturday, September 6, 2008 10:43:32 AM
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Big Block,

How can I get a copy of the template you use for the Dow?

Thanks,

(email removed by moderator)

tobydad
Posted : Saturday, September 6, 2008 10:50:59 AM

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mjhorn162;

I believe I saw that Bigblock has been excused. I will tell you that I don't think the template for which you are asking would have been forthcoming. Your time may be better spent talking with DavidJohnHall, Diceman and Bustermu, for example. There are a other really good traders here, those are just the first 3 names that come to mind.
diceman
Posted : Saturday, September 6, 2008 2:23:02 PM
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mjhorn162
 
The Dow indicator was described here by bustermu in his
May 30 6:49:18 post:
 
 
 
 
 I don't have blocks and cannot attempt to duplicate some of the
other settings/indicators.
(although I'm guessing its based on the Worden stoc)
 
 
Thanks
diceman
driger
Posted : Saturday, September 6, 2008 10:37:36 PM

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QUOTE (mjhorn162)

Big Block,

How can I get a copy of the template you use for the Dow?

Thanks,

(email removed by moderator)




the dow template above?

theres nothing on it. its just a monthly candlestick with volume bars.
bustermu
Posted : Sunday, September 7, 2008 8:35:28 AM
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QUOTE (diceman)
The Dow indicator was described here by bustermu in his May 30 6:49:18 post: 
 
 
 I don't have blocks and cannot attempt to duplicate some of the other settings/indicators.  (although I'm guessing its based on the Worden stoc)


mjhorn 162 and diceman,

At the time I duplicated BigBlock's charts, he was using Quote Tracker, not Blocks.  Although it was not shown, I also duplicated his stochastics.  It was a usual stochastic, not a Worden Stochastic.

mjhorn 162,

If it is the Monthly chart of DJ-30 to which you are refering, I have never heard a reason for any interest in Arithmetic Scale for such a chart in lieu of Logarithmic Scale, especially with a trendline on it.

Thanks,
Jim Murphy
realitycheck
Posted : Sunday, September 7, 2008 6:42:28 PM
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So ...

This weekend brought us the 11th bank failure of 2008 ...

The US Treasury takes over Fannie Mae and Freddie Mac ....

Dow futures are trading up over 200 on Globex ...

Anyone have any thoughts ??

realitycheck
Posted : Sunday, September 14, 2008 6:58:17 PM
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So ....

Wall Street was opened up today ... but only for a select few ... to try to establish a CDS market ...

But what it really shows is that the Fed is prepared to throw all of us under the bus ... if that helps them to save a banking system that is collapsing ...

Nobody wants Lehman ...

The Fed is pressuring Bank of America to take over Merill ... rather than let it fail also ...

I bet they've had maintenance workers working all weekend to grease up those printing presses ....

laphill
Posted : Sunday, September 14, 2008 9:40:32 PM
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According to CNBC , BAC is paying more than book value for MER.
diceman
Posted : Sunday, September 14, 2008 9:51:54 PM
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Wish Id bought some MER on Friday.
 
Gonna be a short covering stampede.
 
 
 
Thanks
diceman
realitycheck
Posted : Sunday, September 14, 2008 10:02:56 PM
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QUOTE (laphill)
According to CNBC , BAC is paying more than book value for MER.


Tough to tell ...

We really do not yet know how much you & I are kicking in ....

realitycheck
Posted : Sunday, September 14, 2008 10:05:25 PM
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QUOTE (diceman)
Wish Id bought some MER on Friday.
 
Gonna be a short covering stampede.
 
 


Well ... is the deal cash or stock ....

Will MER rise to 29 ... or will BAC fall to a level of equilibrium ...

realitycheck
Posted : Monday, September 15, 2008 2:06:37 PM
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QUOTE (realitycheck)
QUOTE (diceman)
Wish Id bought some MER on Friday.
 
Gonna be a short covering stampede.
 
 


Well ... is the deal cash or stock ....

Will MER rise to 29 ... or will BAC fall to a level of equilibrium ...



So ...

How much did MER rise ... and how muchdid BAC fall ?

It seems that the "smart move" was ... if you were short MER ... don't cover ... just short BAC ...

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