tag:blogger.com,1999:blog-11719208.post2828584637847976578..comments2023-11-05T04:36:14.223-08:00Comments on The Mess That Greenspan Made: Predictions for 2009Timhttp://www.blogger.com/profile/16530974968126497397noreply@blogger.comBlogger8125tag:blogger.com,1999:blog-11719208.post-61341372093988582052009-01-04T23:04:00.000-08:002009-01-04T23:04:00.000-08:00I couldn't agree more with comment #10. Those vid...I couldn't agree more with comment #10. Those videos are so annoying.bill moneyhttps://www.blogger.com/profile/00354305205139778353noreply@blogger.comtag:blogger.com,1999:blog-11719208.post-35229223082604679852009-01-04T14:45:00.000-08:002009-01-04T14:45:00.000-08:00Re: Junior mining stocks - what if there are no co...Re: Junior mining stocks - what if there are no cocktail parties ? And do goldbugs get invited to these things anyway ?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-11719208.post-25641127769977819792009-01-04T13:56:00.000-08:002009-01-04T13:56:00.000-08:00Buttonwood sez: David Bowers of Absolute Strategy ...Buttonwood sez: <BR/><BR/>David Bowers of Absolute Strategy Research argues that investors are positioned as if 2009 will see a rerun of the 1930s Depression, having sold equities and commodities and pushed government bond yields down to very low levels. But what if all the measures taken by governments and central banks actually work? Interest rates have been slashed, taxes have been cut, money has been bumped into the banking system. The effect of these policies might come through in 2009, since both monetary and fiscal policy always take a while to have an effect.<BR/><BR/>Mr Bowers reckons that the fourth quarter of 2008 may have seen an “inventory shock”. Faced with credit constraints and forecasts of plunging consumer demand, companies slashed production. The result is that they are entering 2009 with very low inventories. If consumer demand turns out to be better than expected, then companies may find themselves desperate to get hold of components and raw materials. Pricing power will return and commodity prices will shoot back up.<BR/><BR/>That would definitely count as a big surprise. Morgan Stanley, for example, is forecasting a fall of 30% in capital expenditure between now and mid-2010. If Mr Bowers is right, low government-bond yields could lose their appeal and equities could rebound. Income-seeking investors seem unlikely to get much of a return from cash this year.<BR/><BR/>An equity rally could occur even if the global economy is in for a prolonged period of weakness. Two of the best years for Wall Street in the 20th century were 1933 and 1935, despite the severity of the Depression. The value of the London stockmarket more than doubled in 1975, in the midst of a stagflationary crisis and the year before Britain had to ask the IMF for an emergency loan.<BR/><BR/>For much of late 2007 and early 2008, many people in the “real economy” wondered what the financial sector was panicking about. It was only in the autumn that business conditions turned savagely down. By extension, it is quite possible that in the course of 2009 company executives will be bemoaning a slump in both demand and profits at a time when stockmarkets are rallying in anticipation of recovery in 2010.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-11719208.post-16650232215658300662009-01-03T23:50:00.000-08:002009-01-03T23:50:00.000-08:00Also, you could predict that housing start decline...Also, you could predict that housing start declines are going to bottom out, since at the current rate of the past three years, housing construction would completely disappear by some point in 2010. This according the charts you and others have posted.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-11719208.post-9762481768456960822009-01-03T23:47:00.000-08:002009-01-03T23:47:00.000-08:00To echo Anthony, I see big trouble for stocks this...To echo Anthony, I see big trouble for stocks this year at some point. First, hasn't the general P/E been in "overvalued" territory for a very, very long time? Historically speaking, doesn't it usually overshoot downward? Couldn't we very likely see P/E's well down into the single digits as the correction continues?<BR/><BR/>Second, earnings are going to suck, making the impact of low P/E's even worse. <BR/><BR/>I am probably off base, but what do you think?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-11719208.post-62295586755056992752009-01-03T10:00:00.000-08:002009-01-03T10:00:00.000-08:00Anthony - this is based on there being some improv...Anthony - this is based on there being <I>some</I> improvement in the consumer sector by year-end and stocks reacting to this. I'm of the view that, early in the year, we'll at least see a test of the late-2008 lows for equity markets. <BR/><BR/>Shalaom - I'll have a look.Timhttps://www.blogger.com/profile/16530974968126497397noreply@blogger.comtag:blogger.com,1999:blog-11719208.post-34261222623544307712009-01-03T00:21:00.000-08:002009-01-03T00:21:00.000-08:00Sorry! Quantitative Easing Won't WorkIn a Liquidit...<B>Sorry! Quantitative Easing Won't Work</B><BR/><BR/>In a Liquidity Trap although Saving (S) is abnormally high investment (I) is next to 0. <BR/><BR/>Hence, the Keynesian paradigm I = S is not verified.<BR/><BR/>The purpose of Quantitative Easing being to lower the yield on long-term savings it doesn't create $1 of investment. <BR/><BR/>It does diminish the yield on long-term US Treasury debt but lowers marginally, if at all, the asked yield on savings.<BR/><BR/>This and other issues are explored in my tract:<BR/><BR/><B>A Specific Application of Employment, Interest and Money<BR/>Plea for a New World Economic Order</B><BR/><BR/><BR/>Abstract:<BR/><BR/><I>This tract makes a critical analysis of credit based, free market economy, Capitalism, and proves that its dysfunctions are the result of the existence of credit. <BR/><BR/>It shows that income / wealth disparity, cause and consequence of credit and of the level of long-term interest-rates, is the first order hidden variable, possibly the only one, of economic development. <BR/><BR/>It solves most of the puzzles of macro economy: among which Business Cycles, Stagflation, Greenspan Conundrum, Deflation and Keynes' Liquidity Trap... <BR/><BR/>It shows that no fiscal or monetary policy, including the barbaric Quantitative Easing will get us out of depression.</I><BR/><BR/><B>A Credit Free, Free Market Economy will correct all of those dysfunctions.</B><BR/><BR/><BR/>The alternative would be, on the long run, to wait for the physical destruction (through war or rust) of most of our productive assets. It will be at a cost none of us can afford to pay.<BR/><BR/><B><A HREF="http://www.17-76.net/interest.html" REL="nofollow">A Specific Application of Employment, Interest and Money</A></B>Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-11719208.post-79787346529580857782009-01-02T20:04:00.000-08:002009-01-02T20:04:00.000-08:00Are you sure about #3 Tim? If #7 proves true and ...Are you sure about #3 Tim? If #7 proves true and corporate earnings continue to deteriorate from lack of consumer spending, equities will follow suit into the tank. <BR/><BR/>Then again, mining stocks do look good this year.Anthony Alfidihttps://www.blogger.com/profile/11420163177787702821noreply@blogger.com