S&P 1500 - Dow 15k

[Brentastic]

With the biggest bear market about to occur, it's not surprising that we must first endure the biggest sucker rally of all time.

 

http://www.zerohedge.com/article/insider-s...g-buying-2341-1

[Perchoutofwater]

Since the Dow bottomed out, how many firms have been taken out of the Dow and replaced by other companies? If you take the new companies out of the Dow and add back in the ones that were in the Dow when it bottomed out, where would the Dow be today?

[wiegie]

With the biggest bear market about to occur, it's not surprising that we must first endure the biggest sucker rally of all time.

 

http://www.zerohedge.com/article/insider-s...g-buying-2341-1

from the comments at that link:

by Phat Stax

on Tue, 10/05/2010 - 14:16

#626920

 

Woe to the Elliot Wave folks who are busily re-lettering all of their charts. As usual. "The market wants to go up." (furiously re-letter & re-number) "Here is what they waves REALLY look like."

 

I feel for them - I really do.

[Perchoutofwater]

Recent changes in the Dow.

 

On February 19, 2008, Chevron and Bank of America replaced Altria Group and Honeywell. Chevron had previously been a Dow component from July 18, 1930, to November 1, 1999. During Chevron's absence, its split-adjusted price per share had gone from forty-four dollars to eighty-five, while the price of petroleum had risen from twenty-four dollars to a hundred. On September 22, 2008, Kraft Foods replaced the American International Group (AIG) in the index. On June 8, 2009, General Motors and Citigroup were replaced by The Travelers Companies and Cisco Systems, which became the third company traded on the NASDAQ to be part of the Dow.

 

If you undo those changed the Dow is closer to 7,000 than 10,000

[Jackass]

Recent changes in the Dow.

 

On February 19, 2008, Chevron and Bank of America replaced Altria Group and Honeywell. Chevron had previously been a Dow component from July 18, 1930, to November 1, 1999. During Chevron's absence, its split-adjusted price per share had gone from forty-four dollars to eighty-five, while the price of petroleum had risen from twenty-four dollars to a hundred. On September 22, 2008, Kraft Foods replaced the American International Group (AIG) in the index. On June 8, 2009, General Motors and Citigroup were replaced by The Travelers Companies and Cisco Systems, which became the third company traded on the NASDAQ to be part of the Dow.

 

If you undo those changed the Dow is closer to 7,000 than 10,000

 

What's your point?

[Perchoutofwater]

What's your point?

 

Just making sure everyone knows that we are not comparing apples to apples when we look at the Dow then and now. So quoting what the Dow is doing is not a real indicator of what the economy is doing, and the market recovery we've seen is not what some may think.

[dmarc117]

for the 15th millionth time, this market's direction has nothing to do with the economy. its all churning from hifreq firms. there is no real paper in the market, no liquidity, no real volume.

 

and we are due for another flash crash very very soon. which will be from the hifreq computers, not any one event.

[Avernus]

not sure where my post went, but this is definitely the biggest sucker rally right here..

[dmarc117]

not sure where my post went, but this is definitely the biggest sucker rally right here..

 

 

this is true, but if you have been fighting it, youve gotten creamed. still loving my gdx scoop!!!

[bushwacked]

not sure where my post went, but this is definitely the biggest sucker rally right here..

 

 

Bigger then the one before that, and the one before that, and the one before that?

[Jackass]

Just making sure everyone knows that we are not comparing apples to apples when we look at the Dow then and now. So quoting what the Dow is doing is not a real indicator of what the economy is doing, and the market recovery we've seen is not what some may think.

 

well the Dow is only really meant to be a rough estimate. If you left AIG in there when it went to nearly 0, that wouldn't be an accurate representation either. S&P 500 is a better barometer and while i think it's underperformed the Dow recently, it still has had rather strong performance.

 

And as pointed out above, noone who knew what they were talking about ever said the market is supposed to be representative of the economy.

[Avernus]

Bigger then the one before that, and the one before that, and the one before that?

 

 

yuup...and the one before that....

[Jackass]

not sure where my post went, but this is definitely the biggest sucker rally right here..

 

What makes this a sucker rally?

[AtomicCEO]

Brent, you've been predicting an imminent catastrophic crash for the past year.

 

You were wrong. You continue to be wrong. When the time comes, and it probably will, that you become right... you will have been wrong far far longer than you will ever be right.

 

It's probably best to stop pushing the wrong right now, and just wait until you're eventually right to jump back and say "See, I told you so!" rather than piling more wrong on top of the huge steaming pile of wrongness you've accumulated so far.

[bpwallace49]

just sayin' . . . havent seen a huge drop yet.

 

 

Just sayin . . . y'know whut I mean?!?!?!?

[Avernus]

What makes this a sucker rally?

 

 

what makes it not?...where have you been the past 36 months or so?...

 

we're obviously going to get better at some point - I just don't see how that time is now...

 

fundamentals are and have been bad....the market is being propped up for the holiday season to help boost spending....

[AtomicCEO]

the market is being propped up for the holiday season to help boost spending....

 

I'm no economist... but what happens when there is a boost in spending?

[Jackass]

what makes it not?...where have you been the past 36 months or so?...

 

we're obviously going to get better at some point - I just don't see how that time is now...

fundamentals are and have been bad....the market is being propped up for the holiday season to help boost spending....

 

what does any of this mean?

[Chief Dick]

I'm no economist... but what happens when there is a boost in spending?

 

The hookers can afford to douc.he?

Edited October 6, 2010 by Chief Dick

[SheikYerbuti]

Recent changes in the Dow.

 

On February 19, 2008, Chevron and Bank of America replaced Altria Group and Honeywell. Chevron had previously been a Dow component from July 18, 1930, to November 1, 1999. During Chevron's absence, its split-adjusted price per share had gone from forty-four dollars to eighty-five, while the price of petroleum had risen from twenty-four dollars to a hundred. On September 22, 2008, Kraft Foods replaced the American International Group (AIG) in the index. On June 8, 2009, General Motors and Citigroup were replaced by The Travelers Companies and Cisco Systems, which became the third company traded on the NASDAQ to be part of the Dow.

 

If you undo those changed the Dow is closer to 7,000 than 10,000

 

This is the only DOW that reflects today's market as far as I'm concerned. Everything else is smoke and mirrors.

[Sox]

Wiegie,what's your take on the effect of The Currency Reform for Fair Trade ACT if it's passed by the senate and signed into law?

 

The Trade and Tax Doomsday Clocks

 

 

The bill, if passed by the Senate and signed by the president, would mandate that the Department of Commerce take a foreign country's currency interventions into account in determining whether its trading practices are unfair. In the case of China—the target at which this bill is aimed—Commerce would determine that the amount by which the yuan is allegedly undervalued. The number being thrown around now by supporters of the bill, such as the AFL-CIO and the United Auto Workers, is as much as 40%. The cost basis of Chinese-made goods exported to the U.S. would then be adjusted upward by that amount to determine whether they are being sold below cost, an unfair trade practice known as "dumping." Not a single Chinese export good could survive such a test—virtually the entire volume of China's exports to the U.S. suddenly would become subject to countervailing duties.

 

Surely China would retaliate. That makes the bill a nuclear threat of mutual assured economic destruction. If carried out, it would crush trade between China and the United States, which are huge export markets for each other.

[muck]

I think there is a reasonable argument to be made for the possibility that the Yuan is OVERVALUED (not undervalued). FYI.

[Sox]

I think there is a reasonable argument to be made for the possibility that the Yuan is OVERVALUED (not undervalued). FYI.

 

 

Then why would such a bill be introduced,if that's the case?

[bushwacked]

Wiegie,what's your take on the effect of The Currency Reform for Fair Trade ACT if it's passed by the senate and signed into law?

 

The Trade and Tax Doomsday Clocks

 

 

 

I know nothing about it but I do find it interesting a lot of times to read wikipedia snippets of editroialists people link to...that guy blamed Obama for overstating the weakness of the economy during the presidential campaign the day before Lehman Brothers filed for bankruptcy and two days before the stock market tanked. In the same editorial he wrote..."…anyone who says we’re in a recession, or heading into one—especially the worst one since the Great Depression—is making up his own private definition of recession."

 

Linked here apparently....

 

I'm going to take whatever Donald Luskin is saying about our state of the economy with a giant grain of salt.

Edited October 6, 2010 by bushwacked

[wiegie]

Wiegie,what's your take on the effect of The Currency Reform for Fair Trade ACT if it's passed by the senate and signed into law?

 

The Trade and Tax Doomsday Clocks

 

 

The bill, if passed by the Senate and signed by the president, would mandate that the Department of Commerce take a foreign country's currency interventions into account in determining whether its trading practices are unfair. In the case of China—the target at which this bill is aimed—Commerce would determine that the amount by which the yuan is allegedly undervalued. The number being thrown around now by supporters of the bill, such as the AFL-CIO and the United Auto Workers, is as much as 40%. The cost basis of Chinese-made goods exported to the U.S. would then be adjusted upward by that amount to determine whether they are being sold below cost, an unfair trade practice known as "dumping." Not a single Chinese export good could survive such a test—virtually the entire volume of China's exports to the U.S. suddenly would become subject to countervailing duties.

 

Surely China would retaliate. That makes the bill a nuclear threat of mutual assured economic destruction. If carried out, it would crush trade between China and the United States, which are huge export markets for each other.

To answer your question, I don't think the effect will be that big at all. My guess is that even if the bill does get passed, you won't be seeing huge tariffs on Chinese goods. The bill doesn't mandate such tariffs, it only says they could be used and I doubt that anything drastic would be done.

 

As for your quote's claim about how huge the trade market is with China, last year the US exported just under $70 billion dollars worth of stuff to China; however, we imported almost $300 billion worth of stuff. Since US GDP is around $14 trillion, while Chinese GDP is around $5 trillion, China's ability to hit back at us is somewhat muted (in that our exports to China only represent about half of one percent of our total GDP whereas China's exports to us represent about 6% of their GDP).

 

[And to save you time in the future, anytime you read anything by Donald Luskin, you should immediately assume that the exact opposite of what he is saying is correct. He is a hack of the highest magnitude.]

 

I think there is a reasonable argument to be made for the possibility that the Yuan is OVERVALUED (not undervalued). FYI.

You truly think that if China allowed its currency to freely-float against the dollar that it would depreciate in value? Why?