Analysis Topic: Stock & Financial Markets
The analysis published under this topic are as follows.
Tuesday, August 14, 2007
Diverse Asset Class Correlation and Leverage / Stock-Markets / Derivatives
By: Paul_L_Kasriel
Fund managers and investors have been puzzled why prices across a wide spectrum of assets moved together last week - namely, down. I think it has everything to do with delevering. What is bringing about delevering? When a fund owns assets that are going down in value for some fundamental reason, say mortgage-backed securities whose underlying collateral are defaulting subprime mortgages, and the fund is levered, its creditors start to make margin calls.
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Tuesday, August 14, 2007
Blame Central Banks For Sinking Stock Markets / Stock-Markets / Liquidity Bubble
By: Gerard_Jackson
For years I have been warning readers that monetary expansion would inevitably bring recession. This, I forewarned, would probably occur when central banks decided to apply the monetary brakes. This now appears to be the case: hence falling share markets. The problem, as I have explained numerous times, is the grim fact that central bankers in particular and the economics profession in general has no genuine understanding of the nature of interest. In addition, they believe that money is neutral and that a stable price level is necessary to avoid recessions. What we have here is a very dangerous cocktail of ignorance and economic fallacies that has brought the world to the brink of recession.
Tuesday, August 14, 2007
Financial Market Reactions to Central Bank Liquidity Injections / Stock-Markets / Credit Crunch
By: David_Shvartsman
We spent much of last week talking about liquidity, attempting to define or clarify the term by differentiating "market liquidity" and "money liquidity" .
From there, we went on to question how investment markets are impacted by the liquidity created by central banks .
Tuesday, August 14, 2007
Liquidity Problems and the Stock Market / Stock-Markets / Credit Crunch
By: Hans_Wagner
In the last weeks we have seen problems in the mortgage market spill over and negatively affect commercial and investment banks. Volatility in the stock market has increased with the U.S. markets experiencing dramatic swings in price, especially in the last hour. So what can investors do to deal with this situation?
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Tuesday, August 14, 2007
Stock Market, Interest Rates and the Business Cycle / Stock-Markets / Business Cycles
By: Gerard_Jackson
The turbulence in America's subprime market is being blamed for the current international financial crises, proving once again that our economic commentators are largely clueless on such matters. This is made particularly clear by their approach to rising interest rates that are going to cause a lot of pain. (For example, the ANZ bank has raised its standard variable home loan rate to 8.32 per cent).
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Monday, August 13, 2007
A Bull Market in Fools / Stock-Markets / Liquidity Bubble
By: Adrian_Ash
"...All financial bubbles need the rabble to pile in before the bubble goes bang. But something's amiss this time round..."
DAY TRADERS in spring 2000, shoe-shine boys in 1929, the "meaner rabble" in 1720's London ...
Glancing at the history of speculative bubbles, as we do all too often here at BullionVault , we find the ordinary sort in fact acts as the very pin itself.
The one thing needful at the top of each bubble, the rabble also take on the role of greatest sucker, too. Piling in as the smart money runs for the exits, the common-or-garden investor pays top price. He or she is then left holding the "asset" as its price collapses...and by that time, the Lear Jets have long since cleared the tarmac...taking the money with them.
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Monday, August 13, 2007
Stock Market Brushfire; Will there be a run on the Banks? / Stock-Markets / Credit Crunch
By: Mike_Whitney
On Friday, the Dow Jone's clawed its way back from a 200 point deficit to a mere 31 point loss after the Federal Reserve injected $38 billion into the banking system. The Fed had already pumped $24 billion into the system a day earlier after the Dow plummeted 387 points. That brings the Fed's total commitment to a whopping $62 billion.
By some estimates, $326.3 billion has now been added to the G-7 Nations' intra-banking system to prevent a breakdown. That amount will rise considerably in the weeks ahead as the situation continues to deteriorate. Some readers may remember that on Tuesday, August 7, the Fed announced that it was NOT planning to bail out the market.
My, how quickly things change.
Monday, August 13, 2007
Global Financial System in Jeopardy! / Stock-Markets / Financial Crash
By: Money_and_Markets
Martin Weiss writes : For the first time since 9-11, central banks around the world are pouring massive amounts of fresh new cash into their markets.
On Thursday alone, Japan pumped in $8.4 billion … Australia injected $4.2 billion … the U.S. pumped in $24 billion … and the European Central Bank flooded its banking system with an unprecedented $130 billion! And on Friday, they did it again , opening the money floodgates in similar quantities.
Why?
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Sunday, August 12, 2007
FTSE 100 Index UK Stock Market Summer Correction Over? / Stock-Markets / UK Stock Market
By: Nadeem_Walayat
The US Subprime fallout in the form of the ongoing Credit Crunch has taken the FTSE 100 Index sharply lower in a short space of time. The FTSE has fallen into the target zone of 6050 to 6000 and therefore implies that the correction is over and a strong rally is now due. The ongoing impact of hedge fund failures is likely to impact the stock markets across the world for some time to come therefore will be a factor in generation of short-term volatility in the UK Stock market for many more months.
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Sunday, August 12, 2007
Stock and Financial Market Crash Alert #3! Your Last Chance to Act! / Stock-Markets / Financial Crash
By: Money_and_Markets
Martin Weiss writes: Two years ago, we began warning you that the housing market was headed for a massive crash and we urged you to dump mortgage lenders, home builders, and other real estate stocks.
If you had listened then, you would have avoided major losses as our warning became reality.
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Sunday, August 12, 2007
Stock Market Cycle Turning Points Analysis 12th August 2007 / Stock-Markets / Cycles Analysis
By: Andre_Gratian
Current Position of the Market.
SPX: Long-Term Trend - The 12-year cycle is still in its up-phase but, as we approach its midpoint, some of its dominant components are topping and could lead to a severe correction in 2008.
SPX: Intermediate Trend - The intermediate trend which started at 1555 on 7/16 should soon come to an end as the 4.5-yr cycle reverses.
Analysis of the short-term trend is done on a daily basis with the help of hourly charts. It is an important adjunct to the analysis of daily and weekly charts which determines the course of longer market trends.
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Sunday, August 12, 2007
Stock Market Elliott Wave Analysis : Intermediate Top Spotting / Stock-Markets / Elliott Wave Theory
By: Dominick
With volatility, illiquidity, and uncertainty roiling equity markets this week, we tuned out the pundits, removed bias, and traded the charts as they evolved and presented the set ups we identified over the weekend. Last Friday, as “Cramerica” was capitulating, we were looking for a tradable bottom, barring some sort of meltdown. To this effect, last weekend's update said:
“From here, Dom acknowledges that the bears must see Thursday's high as an abc for wave 2, making Friday's selling a wave 3, but this is a low probability setup. Dom's working count has this leg ending soon, but also critical levels where this count has to be abandoned. Remember, price levels are the key to trading here, not unconfirmed counts.”
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Saturday, August 11, 2007
The Grim Reaper Pays A Visit To Wall Street / Stock-Markets / Credit Crunch
By: Mike_Whitney
Alan Greenspan's low-interest, subprime, snake-oil Caravan took another spin down Wall Street Thursday - ripping up pavement, knocking down power-poles and sending traders scampering for safety. When the dust finally settled, “Maestro's” wrecking ball had lopped another 387 points off the Dow Jones leaving markets reeling and investors cringing in fear. No doubt about it; the mood on the “Street” has taken a 180 overnight. A long procession of bears---marching three-abreast with arms locked—can now be seen winding through downtown Manhattan. Their sense of triumph is palpable.Meanwhile the last wounded bull—still writhing at curbside-- is being carted off to slaughter.
MORTGAGE BLUES
No one has summed up the disaster in the mortgage lending business better than Paul Muolo of “Broker Universe”:
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Saturday, August 11, 2007
Dow Theory and Stock Market Update / Stock-Markets / Dow Theory
By: Tim_Wood
Many proclaim that the recent decline below the June 2007 lows by the Industrials and the Transports served to trigger a Dow theory sell signal. Based on the evidence as I read the averages, this is not the case.
The extended advance up out of the 2002/2003 lows has proven to be one of the longest advances in stock market history. As a result, it has proven that the single most important aspect of Dow theory is price and that what we may perceive as value or a given market phasing is in fact secondary. In other words, price itself is the single most important aspect of Dow theory and the old time Dow theorists knew it.
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Saturday, August 11, 2007
Back to the 1998 Crisis, Subprime's to Impact for a Longtime / Stock-Markets / Financial Markets
By: John_Mauldin
In this issue:
China - Upping the Rhetorical Ante
Back to 1998
The End of the Quantitative World
Subprime for a Long Time
The Fugu Ultimatum
90 Years and Still Going Strong
In the early fall of 1998, I remember being on a flight to Bermuda from New York. I was upgraded and sat next to a very distinguished looking gentleman. He was going to a conference about re-insurance and I was going to speak at a large hedge fund conference. We hit it off, and began a very interesting conversation, one that still burns in my mind today. It turns out that he was vice-chairman of one of the largest insurance firms in the world, and was a real financial insider, seemingly knowing every big name on Wall Street personally. After he had a few drinks (he was clearly somewhat stressed), he began to talk about the Long Term Capital Management fund and the problems in the markets. He had had a ring side seat at the Fed-sponsored bailout proceedings.
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Saturday, August 11, 2007
Central Bank Ponzi-Regimes to the Rescue of Financial Markets / Stock-Markets / Central Banks
By: Joseph_Russo
Kindly indulge us - as we pen this week's intro with the spirit and dark-humor of a Dennis Miller-like rant.
We cannot help but find it quite amusing that:
The titan institutions currently adhering to egregiously mutated paradigm-doctrines, handed down by their founding architects - the global cartel of central banks - (financial engineers of worthless marked-to-nothing fiat-paper) suddenly find themselves scrambling to affect “rescue” across a broad spectrum of over-bloated markets, from a systemically induced crisis of inevitability - spawned from the godfather of all Ponzi-schemes from which they preside.
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Saturday, August 11, 2007
Survive the Credit Crunch by Sticking With Good Stocks / Stock-Markets / Credit Crunch
By: Roger_Conrad
How do you solve a liquidity crisis? The simple answer is to inject more liquidity into the financial system. The hard part is not pouring in too much and thereby setting off a speculative boom in the markets that leads to a greater meltdown later on.
That's the dilemma facing the world's central bankers today, as the investment markets confront their worst crisis in half a decade. And unfortunately, the answer is no easier this time around than it was in the summer of 1998, the time of the last liquidity crisis.
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Friday, August 10, 2007
The Fed says, “Don't Panic!” / Stock-Markets / Credit Crunch
By: Anthony_Cherniawski
Yesterday the Federal Reserve “injected” $24 billion into the market. This morning they “injected” another $19 billion. Yesterday the world banks collectively “injected” $150 billion of cash into the markets. This morning, they repeated the procedure with another $173 billion that I can account for. What does that mean? In a nutshell, the Federal Reserve and the other central banks have become the buyers of last resort for Wall Street's toxic waste.
Last night, the banks raised their overnight interest rate from 5.25% to 5.5% as a move that reflected an increased demand for cash and higher risk, even in the overnight (read: bank funds and money markets) accounts. The Fed move was meant to keep markets “orderly” by lowering rates back to 5.25%. The result was to stop the market decline , if only temporarily.
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Friday, August 10, 2007
MPTrader - Small Cap Stocks Recovering / Stock-Markets / US Stock Markets
By: Mike_Paulenoff
Purely from a technical perspective, the iShares Russell 2000 ETF (AMEX: IWM) currently is in the midst of a recovery rally effort in the aftermath of the downleg from 85.74 to 73.95 (14%). The initial upmove of the recovery started at Monday's low of 76.43, and hit its initial high yesterday at 85.74.
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Friday, August 10, 2007
Full Blown Liquidity Crisis Hits Stocks And Gold / Stock-Markets / Credit Crunch
By: Christopher_Laird
As news of new subprime losses emerges around the world, stock markets are selling off. What began as the first string of losses at Bear Stearns has now become wider. In fact, it is beginning to look like a developing world liquidity emergency.
This week, the large French bank Paribas froze 3 funds worth about $2 billion after it became clear they cannot value the mortgage derivatives held by the funds. Soon after this news, EU banks and institutions started to flee to cash. The ECB had to lend an unprecedented $130 billion to stave off a banking/liquidity crisis. European investors said the ECB was acting on an emergency basis.
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