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Thread: Possible US crash implications for DR

  1. #11
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    Chris, my guess is you have no idea what Cramer was talking about. Never mind that Cramer is another charlatan who pounded the table when Sycamore Networks stock fell "all the way" to 150.


    Quote Originally Posted by Chris View Post
    Thought that this video spells out the size of the problem. This is what you call a 'Holy Sh!t' moment. From CNBC MSNBC - Video Front Page

  2. #12
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    I thought it was hilarious. But, the numbers that he spewed out, were massive. The Holy Sh!it Moment? Did any of you watch the host of the show? It was such a moment for her ...

    I probably don't Mondongo, in reality. But in money, perhaps I do have an inkling.

  3. #13
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    There's a big difference between "crashing" and "correcting".

  4. #14
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    Quote Originally Posted by Chris View Post
    I thought it was hilarious. But, the numbers that he spewed out, were massive. The Holy Sh!it Moment? Did any of you watch the host of the show? It was such a moment for her ...

    I probably don't Mondongo, in reality. But in money, perhaps I do have an inkling.
    I wrote a big ass post, but dr1 one ate it. I was then going to give up responding to you, but than decided just to focus on that which Cramer has himself confessed to earlier this year:

    ...could it be?, ...

    "A lot of times when I was short at my hedge fund—meaning I needed [the market to go] down—I would create a level of activity before [the market opened] that could drive the [pre-market] futures [down]. … …
    It's a fun game, and it's a lucrative game. You can move [the market] up and then fade it—that often creates a very negative feel. … That's a strategy very worth doing. …"

    TheStreet.com TV


    Jim Cramers Guide to Market Manipulation - Mergers, Acquisitions, Venture Capital, Hedge Funds -- DealBook - New York Times

    Will Cramer's crazy confession destroy his career? - By Henry Blodget - Slate Magazine

    ..sounds familiar?
    Last edited by aegap; 08-06-2007 at 08:57 PM.

  5. #15
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    Quote Originally Posted by shuffine View Post
    There's a big difference between "crashing" and "correcting".
    Exactly!! ..a very healthy thing actually, for it gets rid of dead and dying tissue..

  6. #16
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    Default I forgot the P.S.

    I love Jim Cramer, and I highly recommend his show.

  7. #17
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    I'm no financial 'brains' at all but I found this gave an interesting historical perspective:
    The Silver Bear Cafe

    I also see that Nouriel Roubini, professor at the NYU/Stern School of business and chairman of RGE Monitor, 'predicts that the credit crisis originating in the sub-prime mortgage market will surpass the severity of the liquidity crunch triggered by the collapse of US hedge fund Long Term Capital Management in the late 1990s'. He is suggesting that this will leak into the corporate market as default rates, which have been unusually low in recent years, jump and corporate yields increase with the re-pricing of risk. So yes, he's agreeing with mondongo & aegap that this is risk re-pricing but he is also saying 'the result will be a recession in the US, with growth stagnating below 1% for several quarters'. For those who subscribe it's in Latin Finance
    Latin Finance – Current balance, income and financial ratios for Latin American banks
    On right hand side Headlines for 14 August, click on 'Sub Prime Fall-Out Worse than LTCM, Says Roubini'.

  8. #18
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    Quote Originally Posted by aegap View Post
    Exactly!! ..a very healthy thing actually, for it gets rid of dead and dying tissue..
    Wouldn't it be great if the DR had true free market dynamics so that we could rid of a whole lot of dead flesh here too? Then again, maybe that wouldn't be such a good idea as there would only probably be the skeleton left.

  9. #19
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    Default pretty good predictions

    Quote Originally Posted by Lambada View Post

    I also see that Nouriel Roubini, professor at the NYU/Stern School of business and chairman of RGE Monitor, 'predicts that the credit crisis originating in the sub-prime mortgage market will surpass the severity of the liquidity crunch triggered by the collapse of US hedge fund Long Term Capital Management in the late 1990s'.
    The MSM was yelling "market CRASH!" at full long back then too..


    He is suggesting that this will leak into the corporate market as default rates, which have been unusually low in recent years, jump and corporate yields increase with the re-pricing of risk.
    ..while still remaining well below historical averages

    he's .. saying 'the result will be a recession in the US, with growth stagnating below 1% for several quarters'. For those who subscribe it's in
    While by U.S. vibrant econmy that is rather low, it really isn't . case in point: 1.5% growth and 6% unemployment would be relative very low in the U.S., but most leading European economies/countries would kill for those numbers.

    The E.U as a whole would really, really kill for those numbers, ...

    BBC NEWS | Business | Leading EU nations see slowdown

    Tuesday, 14 August 2007
    Figures showed growth for the 13-nation eurozone hit 0.3% in the quarter, ..missing forecasts.

    This figure was down from growth of 0.7% seen in the first three months of the year.
    The 27-member EU saw growth of 0.5%, marking a drop from 0.7% in the previous quarter. The data follows disappointing news last week from Italy, which said its economy had grown by just 0.1% in the second quarter, also below expectations.
    Last edited by aegap; 08-14-2007 at 02:07 PM.

  10. #20
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    Default long and very informative

    This is for those who really want to learn something and have the capacity to read and ruminate.

    Every 5-10 years, there occurs a dislocating financial market event(s) that causes heavily leveraged (hedge) funds and corporations to go out of business.


    One of the links posted by Lambada quotes a very rich and well educated man from a highly regarded Wall St financial institution saying something like (I paraphrase): These are 25 sigma events. They should not happen for a million years.


    Clearly, these Ivy League educated folk have it wrong. Their mathematical models do not properly take into account (and I'm sure they know it) what are called "catastrophe events". The reason they don't take catastrophe events into account is that doing so would significantly reduce their short term returns. This would then curtail their ability to advertise their fund.

    For those who have read this far, congratulations. Take the above seriously because you will not see this in many places. Take a look at the first 2 1/2 pages of the following link....and Google "fat tail distributions".

    http://arxiv.org/ftp/cs/papers/0512/0512022.pdf

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