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Dow Dropping Fast, dont buy the China Stock

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posted on Feb, 27 2007 @ 05:31 PM
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>>>>>a 'crash' is normally for double digit percentage losses... so 3% is a little off, >>>>>although China was at almost 9% so a little closer.

Actually, the graphs of 1929 and 1987 are almost identical. Furthermore, the comparisons are incredible in every way. For example, at the core of the plummet in 1929, the TiCKERTAPE machine was running 89 minutes behind. In 1987, REUTERS was running 91 minutes behind.

A crash will be about a 25% to 30% fall. The graph indicates a 30% fall imminent.

>>>>>>At the moment it's the worst day drop since the day the market opened after 9/11.

9/11 IRRELVANT. It is enough tome after 1987 for those who were experienced in it to have lrgely left the market, even in a management capacity and allow the newbies to really cock it up.

>>>>>>Normally the panic subsides after the trading closes for the day and everyone works out a plan. The issue here is there's more bad financial news on the immediate horizon that may exacerbate matters

NO! Definitely NO. The graphs show this. It is simply a classical case of Adaptive Expectations as opposed to Rational Expectations. Consider if you had the following Index reading on consecutive days 100, 90, 80 ...what is the next day's index? Perhps 26. What? Because people are not stupid and will see which way the wind is blowing.

What is to be expected is three days of bad losses followed by two days of catastrophe, followed by a rebound.
What happens next will depend on which type of graph it follows. If the Dead Cat Bounce is 50%, then Technical Analysis indicates that the market will drift slowly down from there, probably to the very bottom of the melt down (Dow Jones at about 8200). If, however, the market only bounces back to retrace 30% or so of the crash, then it will quickly give up all the bounce and keep falling to 10% (Dow Jones at about 1200 within 18 months) or less of its original value.




posted on Feb, 27 2007 @ 05:34 PM
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If you are holding loads of Stock, it is worth remembering the OLD SAYING from the London Stock Exchange...

WHEN A STOCK MARKET IS STARTING TO CRASH...

...HE WHO PANICS FIRST IS SAVED!!!



posted on Feb, 27 2007 @ 05:37 PM
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What is to be expected is three days of bad losses followed by two days of catastrophe, followed by a rebound.


Is this what you feel will happen now?



posted on Feb, 27 2007 @ 05:38 PM
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Originally posted by nobodyelse
If you are holding loads of Stock, it is worth remembering the OLD SAYING from the London Stock Exchange...

WHEN A STOCK MARKET IS STARTING TO CRASH...

...HE WHO PANICS FIRST IS SAVED!!!


Ok wait let's follow your logic. So let's say I take a loss during the Great Depression, but the corporation I had was say Merill Lynch?

That means I cut my losses and ran...but here 70 years later...Merill Lynch is over 10,000% larger than it was.

So I lost all that growth because I cut and ran during some market crash.

There's a better phrase, from war.

"He who panics, dies".



posted on Feb, 27 2007 @ 05:41 PM
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Originally posted by Cerkit Breaker
CNN is saying that this was a glitch, which it most obviously is not, for if it where, no one would trust the stock market at all, which would make it crash even further.


There were glitches today, for while I was showing bids $0.50 above the asks on the stock I was trading, around 3:15 ish. I put in a couple of small test orders, 10c BELOW the most recent trade ,which was 60c below the bid(!), and didn't fill. For a while at least I had no idea where the stock was trading. quite scarey.

I'm now short, covering some puts I've been selling. I might miss any bounce tommorrow, but better safe than sorry..

Luckily I sold out of a lot of my positions in the morning so whilst I got stung quite hard today, I'll be able to sleep soundly tonight..



posted on Feb, 27 2007 @ 05:42 PM
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One of the things that helped to protect the financial system in 1987 was that there was always confidence in the banks, not least as they were still largely protected by all the guarntee legislation introduced after 1929.

...Since then, all this legislation has now been repealed. If this crash occurs really, really badly, within a couple of months, there could be a run on the banks.



posted on Feb, 27 2007 @ 05:44 PM
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quote:
What is to be expected is three days of bad losses followed by two days of catastrophe, followed by a rebound.


Is this what you feel will happen now?



>>>>>YES, if not sooner.



posted on Feb, 27 2007 @ 05:44 PM
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some news..

We've got some bad news coming about Japan's economy and currency to be released in about 30mins.



posted on Feb, 27 2007 @ 05:48 PM
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>>>Ok wait let's follow your logic. So let's say I take a loss during the Great >>>Depression, but the corporation I had was say Merill Lynch? That means I cut my >>>losses and ran...but here 70 years later...Merill Lynch is over 10,000% larger than i>>>t was. So I lost all that growth because I cut and ran during some market crash. >>>There's a better phrase, from war."He who panics, dies".

>>>NOT AT ALL. You buy back at the bottom, and that, as I have shown, is easy to do, BUT you must be aware that you should not do it on credit, as the banks might not be there in 3 months.



posted on Feb, 27 2007 @ 05:57 PM
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Originally posted by nobodyelse
>>>Ok wait let's follow your logic. So let's say I take a loss during the Great >>>Depression, but the corporation I had was say Merill Lynch? That means I cut my >>>losses and ran...but here 70 years later...Merill Lynch is over 10,000% larger than i>>>t was. So I lost all that growth because I cut and ran during some market crash. >>>There's a better phrase, from war."He who panics, dies".

>>>NOT AT ALL. You buy back at the bottom, and that, as I have shown, is easy to do, BUT you must be aware that you should not do it on credit, as the banks might not be there in 3 months.


Buying back on the bottom is where the risk can cause you to LOSE everything.

You bail out you may save enough that you reap a say...well in this case it might be a 3 or 4% gain. But if you misjudge you may sell 1% down and buy back at 1% up.

That is why with fluctuations, in general, I think Warren Buffett's methods (Originally Graham's) are the best. These guys didn't turn pennies to millions because they panicked.

As for Japan, I'm interested in hearing, and I'm interested in knowing why the stock prices aren't showing...is this a day trading thing or is the guy posting that talking from a Broker's standpoint?



posted on Feb, 27 2007 @ 05:59 PM
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It is not figures that will now drive whether the market will crash, it is these key events that would push it over the cliff. If these are avoided, one might escape a full blown crash for the moment, probably until May:-

1. Will China (or any other market close "to protect itself") ?

THis alone would create panic selling on other markets and be reminiscent of 1929 and 1987 when Hong Kong F**KED everyone by forceably closing its doors.

2. Any major market breaks the 12% fall level.

3. The Israelis/Yankies/Iranians start ANY FORM OF SHOOTING at each other, even just some lost US Fighter Pilot shhots off a dozen rounds the wrong side of the Iraq/Iran border.

4. Someone does a "Corporal Jones". Just like off the BBC Comedy Series "Dads Army", if some cretin from a major Government, like Gordon Brown or Bush, starts running around like a maniac, appearing in front of the Boobtube to tell everyone "DON'T PANIC! DON'T PANIC! DON'T PANIC!" or "We're taking action to pump liquidity into the system" or "Crisis? What Crisis?" then you'll be lucky to see the Dow Jones into triple figures by the end of tomorrow.



posted on Feb, 27 2007 @ 06:01 PM
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Tokyo opens up in 2 mins...

apparently its not going to be pretty, first major market to open up for the new day.



posted on Feb, 27 2007 @ 06:01 PM
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Australia has breaking news also that the Stock Market has lost 3% at the start of trading.



posted on Feb, 27 2007 @ 06:03 PM
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I've heard the naysayers on CNBC who say we're overdue for a correction looking at a 10-13% range. Don't ask why 13 and not 15% for easy math...

All other factors aside, this market is overvalued. Look at some of the P/E ratios out there. Too much speculation is a dangerous thing.



posted on Feb, 27 2007 @ 06:04 PM
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Should I be worried, it sounds like chaos over their. I remember (long time ago) watching the news and paying attention to the stock market reports and people going crazy waving their hands like cavemen and spitting out words for some odd reason at the hundreds of T.V monitors. I was like, O_o' "What has this world come to?" I mean, is this the end of the world? Are the skys falling ?!

7A



posted on Feb, 27 2007 @ 06:08 PM
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(South Korea) KOSPI Composite Index down 57.52 (3.95%)

(Japan) Nikkei 225 down 292.00 (1.61%)

Its expected to get worse...



posted on Feb, 27 2007 @ 06:12 PM
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another link to watch for

www.bloomberg.com...

The China drop is expected to last days, all world markets are expected to take a beating, especially if China opens up worse. Comments about slowing US economy and potential recession are expected to hit the market today as well.

[edit]

Nikkei 225 has now dropped 3% at the start of trading.

[edit on 27-2-2007 by infinite]



posted on Feb, 27 2007 @ 06:13 PM
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The bigger question is what has this world come to that unfit beta-males beat their chests like gorillas and bark like baboons at tv screens with green and red numbers all over them?

But seriously there's a lot out there which reads that this is just a big dip and will go away rather soon.

www.marketwatch.com... yhoo



posted on Feb, 27 2007 @ 06:14 PM
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Stock Markets don't fall at double digit percentages for more than 1 day and a morning.
By lunch time the day after the really big one, when people are just hurling cash away, that's when you buy calls. All the Indexes will seize up as people leave their phone off the hook. So you watch those indexes that are still trading.

In 1987, thanks to Lorna Petersen's lone stand at the American Stock Exchange, the "Main Market Index" was still trading 18 hours later. At lunch time, it began to "turn blue". Within an hour everyone in the western world was piling into it.

At the bottom of the crash, the American Stock Exchange is a key one to watch as its rules are dfifferent to that of the NY Stock Exchange. The NY Stock Exchange requires all members to be solvent at the time of trading. The American only requires them to be solvent at the start of trading and at the end of the day. By midday on the second day of the crash, Petersen, who alone continued to trade options on the American throughout the crash regardless, had lost run up her firm, Stock, Leeds Kellogg, losses rivaling the US Budget Deficit. By close of business, she had turned it into a waffer thin profit of a few thousand. It was however, not wihout loss, she lost 3 octaves off her hearing as a result of those two days of trading. (Read her book "Play Money" if you want to know how to make a fortune out of a crash).



posted on Feb, 27 2007 @ 06:16 PM
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Breaking news..

Japans two markets, Kospi and Nikkei 255 have dropped by 3 and 4%

Kospi (4%)
Nikkei 255 (3%)

Nikkei 255 is about to hit a 4% drop



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