Worst June for the S&P and Dow since the Great Depression

Worst June for the S&P and Dow since the Great Depression

money.cnn.com

The S&P 500 lost 8.6% in June, the worst monthly performance since September 2002 when it lost 11%, and the worst June performance since 1930, when it slumped 16.5%.

The Dow lost 10.2% month-to-date, the worst monthly performance since September 2002 when it tumbled 12.4%, and the worst June performance since 1930, when it sank 17.7%.

(visit the link for the full news article)

Brink of collapse anyone?

money.cnn.com
(visit the link for the full news article)

collapse is imminent


better get good at something to make a living

reply to post by bismarcksea


Yep, you're right Bismarck, looking pretty grim for sure...

Same the world over in equities....Australian market had its worst year since 1940 and I'm sure its pretty much the same in Europe and most Asian markets...

Thinking about whats round the corner gives me a decidedly queasy feeling in my tummy

Peace

Come on everyone, stop it ! Get your credit cards and spend us out of this mess

This is pretty standard media propaganda...which I'm sure ATS - as always when the propaganda agrees with what the members want to believe - will eat up.

I find it hilarious that when the DOW goes up the doomsday faithful proclaim that the end is still nigh because the DOW only really has a small impact on the economy and does not represent our economic condition. When it goes down, all of a sudden the DOW and our economic health become synonymous.

The problem of course, with taking arbitrary time periods like a month is that the stock market does not operate within such confined and arbitrary time periods. That the stock market goes down X amount in X days means little, because X+1 days could make all the difference in the world. The media knows this but...its not as fun as the doom talk.

The propganda on ATS is getting so thick its becoming harder to step through the sewage. I feel like I'm reading the web pages of CNN and MSNBC rather than ATS.

[edit on 30-6-2008 by ALightinDarkness]

Worst June, not the worst month. What most people do not realize that for the quarter ending today, a diversifed, all equity fund portfolio is about even for the last 3 months. Small cap stocks are up a few percent in that time, while international took the biggest hit. The current levels are the same as when we started the 10% rally in April / May. This is a good time to buy stocks in my opinion.

Just for kicks I am going to try to find some threads from 2000-2002 period. I'm sure the doom and gloom was abound at that point too. A diversified equity fund investor has made about 80% since then. The sheep think everyone lost money in that period. That is why the rich get richer and the middle class is less well off. You have to have faith in the system, because it is the only systen that we have. Personally I want major changes to the system, but until then i am going to ride along with the PTB.

It shouldn't be looked at as "Doom and Gloom", it should be looked at as an opportunity to "expand our minds" and get us as a people out of this mess. The only problem I see is the Congress, Senators, and our President to hold us back.

As soon as we break this cycle of madness we will all be free. Free your mind and all will be well.

Please remain on topic.

Off Topic or Trollish Posts will be removed.


Thank You.

Originally posted by ALightinDarkness

Originally posted by projectvxn
I'm beginning to think that you'd argue against the sky being blue, as well as find excuses for why it is actually purple and how we're all ignorant for not seeing it your way.

As you are one of the standard bearers for ATS group think and a spokesperson for neoliberalism, I find this humorous. Your the one who gets upset when someone doesn't agree with ATS group think propaganda.

I know..differing view points are not productive when your trying to perpetuate group think. We should all just agree the end is nigh and huddle in the corner (after we murder Bush with an axe to make you and your fellow Bush haters happy). No need to discuss.

[edit on 30-6-2008 by ALightinDarkness]

AAAHHHRRGGG!!!
While in other threads watching LIGHT talk to others has physically made me ache, and his constant come backs have infuriated me to the point of homocide, I am afriad I have to agree with him on this point.

In support of the OP:

www.kunstler.com...

...Our debt problems today are of a magnitude so extreme that astronomers would be hard pressed to calculate them. By any rational measure our society is comprehensively bankrupt. From the federal treasury down to the suburban cul-de-sacs so much loaned money is either not being paid back, or is at risk of never being paid back, that the suckage of presumed wealth has passed through an event horizon out of the known universe into some other realm of space-time, never to be seen again in this realm. This would seem to be the very essence of monetary deflation -- money defaulted out-of-existence.

This condition is partly disguised by both the loss of credibility of US currency and real-world scarcities of oil and food, but the upshot will be something at least twice as bad as the Great Depression of the 1930s: people with no money in a land with no resources (with manpower that has no discipline), hardly any family farms left, cities that are basket-cases of bottomless need, comatose small towns stripped of their assets and social capital, an aviation industry on the verge of death, and a railroad system that is the laughingstock of the world. Not to mention the mind-boggling liabilities of suburbia and the motoring infrastructure that services it...

This website is a must read.

reply to post by kosmicjack


This article is somewhere on the mark, kosmic....thanks for posting it...

In the worlds financial system at the moment, for every dollar of real wealth, there are potentially tens of individuals (banks, hedge funds, investors, speculators, governments, average joes) claiming dibs on that dollar (in some cases, not all)...

Banks and other financial institutions do not know who is really holding debt, and who is really holding that dollar....Hence their reluctance to borrow to each other, and ultimately forcing up borrowing costs for business and consumers...

And hence the call for greater transparency throughout the financial industry world-wide, particularly in the area of "exotic" financial instruments with regard to the accounting and reporting of same...

Thanks again for posting the article

Peace

I don't see disaster here, what I see is opportunity. The old adage is "buy low, sell high" so it would seem that now is the time to invest in the stock market.

Reply to disgusted.

True a diversified mutual fund would be relatively unchanged if bought in March and looked at today. I took a look at some of the most widely held mutual funds (ie Fidelity Magellan)and you are pretty much correct, but think about inflation since then I'd call it a net loss. A couple of things I'd like to bring up about differences between 02 and now. First what percentage of the working/401k holding public is within 5yrs of retirement now versus then? Second, then the hot money was beginning it's flow into housing, now it's commodities. No matter what the NAR, government, or financial media said no one ever HAD to buy a house.

I must admit, that this current downward move has exceeded my own expectations. I closed out a couple of XLF puts that I wish I had held longer, and though profitable I could have made so much more. Today the XLF (etf that tracks financials) continued it's nosedive. Lehman Brothers resumed it's Bear impersonation. Something isn't right with the markets right now. I don't know what it is or i would have a position. Some possibilities could be: imminent mid-size bank failure (think IMB, FED, DSL), concerns over ECB action later this week, monoline failure, Fed Reserve impotence, and good ol' geo-political instabillity.

Personally I'm glad that I'm all in cash right now. I follow the S&P as the most important index in relation to the economy. The reason I'm glad I'm flat right now is it wouldn't surprise me to see a moonshot back to around 1350 or a crash to triple digits.

reply to post by jefwane


This is pretty close to the most well written and thought out posts on this subject I've seen on ATS, Jef...

Yes, you are spot on...There is something VERY wrong in the banking industry/the markets right now and it is hard to know EXACTLY what that is...

And I agree with your assessment that there may well be several smaller-mid sized banks go under very soon...

Whether the contagion then leads to another Bear Stearns amongst larger institutions will be interesting to see...

Peace

reply to post by jefwane


That is one thing I do not get. People hiding out in cash(not picking on you specifically). In the current scenario, the real worry is about the strength of the dollar. End result would be hyperinflation or the end of the dollar. Cash is a real bad place to be in hyperinflation. US Bonds are also a terrible place to be. People think gold, but if the worst happens, then we likely go to a metals based currency? and at that point the goverment will confiscate your gold and make it illegal for transacting business. They will want it all.

Probably the best bet would be foriegn and emerging market stocks and bonds. Places like Russia, India, South America, etc. They would be the least effected in my opinion.

The markets are hard to follow and understand at this point. Many big time investors are afraid to go either long or short. I have sold my clients on the fact that you need to have stocks, even in retirement and that when the markets fall, you have to buy It has been a successful strategy for many many decades. Most have not saved enough to have a decent retirement and stocks are really their only chance.

Lets look at the people who expected to be able to live on a annual 5% bond yield. Just a matter of time before they have to drastically reduce their standard of living drastically or start digging into their capital.Once they do that it is ashort road to running out of money. With stocks you can take 6% in income and also increase it each year to keep up with inflation. In 49 of the last 50, 30 year periods, the guy that chose stocks has not run out of money, while the guy who picks bonds has a 50% chance of outliving his money. Maybe this is that 1 time out of 50. Who knows? But odds are something will happen to get the markets kick started once again and the rewards will come to the owner and not the loaner. The real risk is not owning stocks, but not owning enough stocks.



[edit on 30-6-2008 by disgustedbyhumanity]

Reply to disgusted

I think that the reson so many people would rather be in cash is the Bear Market axiom "return of capital is more important than retern on capital". You do have a point about emerging markets however. Of the BRIC (Brazil, Russia, India, and China) I think that the B&R are most tempting to go long on. Less than a billion people to keep happy, minerally rich, energy (more or less) self sufficient, and agriculturally (at least capable of) self-sufficiency. I'm actually looking for a good entry to invest in Brazil.

I personally am mainly ( save a couple of highly speculative plays) in cash not because I think I'll make a great return, but because I think I'll be able to buy things cheaper in the near future, be it a new house, stocks, and maybe even bonds. You'll not hear me touting gold since I think that after this plays out, deflation is as likely as inflation.

I am concerned about the boomers though. A vast cohort of them about to retire, right when we are hitting the worst financial crisis since the GD. I have no doubts that they will throw the rest of us under the bus with their political clout, sense of entitlement, and overall hubris when TSHTF.