OEXCHAOS

Mark, a while back you made a call that all the money that was being pumped into our financial system was going to make a difference for the better. I think you also mentioned that the mortgage market should improve as well which supports your call. Do you still feel the same way and is there any change to your call for better days ahead? I could not find your post but I remember it was very popular and stirred up the natives. TIA

I'm absolutely confident that we've got good news coming. It's going to bite sooner or later and with the liquidity we're going to be headed higher. The problem is the time lags. The market is very unamenable to discounting anything positive unless it's right there, in hand. I understand the psychology, too. Technically, it just can't seem to get anything going. I've beein saying, honor your buys. The problem is, we ain't gettin' buys. What I'm very worried about is that the Fed, in their efforts to "help", are going spend so much that rates head back up again, murdering the recovery in its crib. That psychology thing I mentioned above is very much in the real economy too. I spoke with someone I know who manufactures for retail. He and I both see and get the word that individuals are still buying, but the retailers are NOT sending out new orders. The shows are DEAD. Sales at the shows are WAY down--like less than 30% of the worst year in the last 15. Tons of his peers are gone. For good. The normal cycle is totally bound up by psychology (fear). It's a scary thing and it makes business planning very hard, which, of course, makes a recovery very hard. The market is discounting that. I have to say, I was open to it taking at least this long for good news to hit, but I figured that the market would hold a bit better as the first drips hit. To my eye, it isn't. It sure looks like it's discounting greater time lags. So, the only thing to do is continue to honor your buys, but take your sells too. This could go on for a while and if the worst case scenario occurs, at least you've got a shot at being short for it.

And now we're nearing the junction in the market where people will start giving up this HOPE. Cavalry isn't coming, ladies. Time to smell the roses.

The shows are DEAD. Sales at the shows are WAY down--like less than 30% of the worst year in the last 15. Tons of his peers are gone. For good.

And what is truly scary is that we'rte only at the start of this debacle.

Edited by ogm, 27 February 2009 - 07:46 AM.