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IYB, OEX and the rest of the Refi bulls expecting a new

Started by BigBadBear , Jan 07 2009 09:10 PM

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15 replies to this topic

#1 BigBadBear

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Posted 07 January 2009 - 09:10 PM

or should I say negative multiplier data.

http://market-ticker...-Flat-Spin.html


You guys just dont get it. Even those that refi will save every single dime. Shame US universities arnt switching more to behavioural economics courses. Economics does not work off vulcan logic but something called 'earthling' physcology.

Can you saw DOW 4000 by year end.

Edited by BigBadBear, 07 January 2009 - 09:13 PM.

#2 Rogerdodger

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Posted 07 January 2009 - 09:17 PM

Posted Image
"Nature's Failure to Function in a 'Predictable Way'... 500 years ago?"
BIGGEST SCIENCE SCANDAL EVER...Official records systematically 'adjusted'.

#3 U.F.O.

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Posted 07 January 2009 - 09:44 PM

BBB....why do you think the velocity of money has fallen the way it has? You think it may have something to do with the fact that for 6 months hardly anyone in the continental U.S. wrote a loan? As credit starts flowing (and a refi wave will get the ball rolling) velocity increases. Your boy you linked to is wrong as a dong. "Raise rates here and just let the defaults come as they may" is probably the most stupid suggestion I've ever heard from anyone on any subject. Jeezzz. Where do they get these guys? U.F.O.

Edited by U.F.O., 07 January 2009 - 09:45 PM.

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#4 BigBadBear

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Posted 07 January 2009 - 10:02 PM

ohh, so you think increasing fund availability increases the multiplier( hold on..consulting my Economics[Krugman] textbook )...naw looks like you have it the other way around...continue to hope. Refi's will not increase the multiplier. You cant invent economic theory because you dont like a negative multiplier or perhaps you think the Fed research is wrong :)

#5 NAV

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Posted 07 January 2009 - 10:06 PM

BBB,

Coudn't agree with you more. That's prolly that most flawed theory on stock market and economy i have heard. If that were true, the long bond rates in Japan should have lead to a real estate and economic boom of epic proportions. ;)

http://www.investmen...2/20050613b.gif

Posted Image

Edited by NAV, 07 January 2009 - 10:08 PM.

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#6 BigBadBear

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Posted 07 January 2009 - 10:16 PM

This is how 'Elliot' and yes I hate to admit it Prechters socioeconomics comes into play. The foundation of economics is human behaviour and that behaviour is governed by cycles[long term and short term] of pessimisim an optimissim. I suspect even Bernanke knows he cannot become the Sigmuend Frued of the economy. Batten the hatches. The downturn has only just began.

#7 U.F.O.

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Posted 07 January 2009 - 10:43 PM

No, I don't think increasing fund availability increases the multiplier. I think increased economic activity does. A refi wave here gets long dormant loan pipelines active again. You and what's his name want to crash the system to bedrock and then just start over. A lot of needless damage will happen in the process. This is a just a bad idea. U.F.O.
"Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote!"
~Benjamin Franklin~

#8 salsabob

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Posted 07 January 2009 - 10:47 PM

Yep, the monetary side has just about shot its wad; maybe at this point even making things worst.

That's why the govt is turning on the fiscal spigot to force velocity. Yes, it will take some time but it beats the other means of doing it (i.e., big war).

Maybe love isn't the right word, but you got to be at least awestruck by how a 4th Turning crisis so easily mutates the 3T mantra of government wasteful spending into a godsend. Although a lot of us will be going kicking and screaming. ;)

Edited by salsabob, 07 January 2009 - 10:47 PM.

John Galt shrugged, outsourced to Red China and opened a hedge fund for unregulated securitized credit derivatives.

If the world didn't suck, wouldn't we all just fly off?

#9 U.F.O.

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Posted 07 January 2009 - 11:04 PM

"If the money supply did not rise significantly to offset that slowdown in velocity the economy would already be in a much deeper recession. While the Fed does not have control over M2, when they lower interest rates, it is supposed to make us want to take on more risk, borrow money and boost the economy. So, they have an indirect influence."

http://www.realclear...y_of_money.html

Slightly dated but very prescient.

U.F.O.
"Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote!"
~Benjamin Franklin~

#10 danzman

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Posted 07 January 2009 - 11:05 PM

Anyone hear more about the rumor (as reported by the WSJ) that
the Federal Reserve was going to issue debt securities? Or at
least they were contemplating it. Not sure who would buy them
anyway. Just looking for signs of hyper-inflation a year or two
out.


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D

Edited by danzman, 07 January 2009 - 11:07 PM.

I don't make predictions, I just react.
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