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WHO IS RESPONSIBLE FOR THE YO-YO STOCK MARKET (VANITY)
Self ^ | 4/27/2004 | Jesse Housman

Posted on 04/27/2004 1:52:06 PM PDT by JesseHousman

Just why is the stock market acting like a yo-yo out of control?

I grow more certain each day that we are being led down the garden path by a bunch of know-nothing 27-year-olds with MBAs that are capable of seeing only quarterly results, not what the subject company will earn this year, next year or the year after.

When I hear some overeducated boob with no business experience espouse "Company A" did not meet his expectations for the quarter, then downgrade said company, I cannot help but wonder if these guys have ever spent any time in the real world. I wonder, while in college if they ever read Benjamin Graham's book "The Intelligent Investor," which became required reading in most "B" schools. The answer is obviously "no."

To regain market stability and investor confidence, one of the many things that must occur is long-range thinking, not just what is happening in 90 short days.

How dare these overeducated, under-experienced boobs downgrade a company that did not meet their estimate.

An estimate is just that --an estimate--which is usually wrong. Unfortunately, the big investment firms are populated by these dullards and they are the ones causing IRAs and other investment vehicles to continue proceeding down a bumpy road that needs repaving!

The situation flows into our public schools and government as well.. Who are these people teaching our children? LIBERALS with corrupt agendas geared to convert innocent children that will become the next generation of misfits and druggies.

Remember what Hillary said.........It takes a village.. . of What?....gays and misfits.

The Democrat move is on to register the generation that has been brainwashed for the last decade or two to VOTE.


TOPICS: Your Opinion/Questions
KEYWORDS: stockmarket

1 posted on 04/27/2004 1:52:08 PM PDT by JesseHousman
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To: JesseHousman
You act like this something new or never seen before. This is standard operating procedure and why, over the long haul, the markets are near guaranteed to reward shareholders who behave counter to that which you've observed & witnessed.
2 posted on 04/27/2004 1:55:26 PM PDT by Steven W.
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To: JesseHousman
"...we are being led down the garden path by a bunch of know-nothing 27-year-olds with MBAs that are capable of seeing only quarterly results..."

Yes! A perfect description of what I've been thinking for the last 6 to 9 months! Bravo.

3 posted on 04/27/2004 1:56:12 PM PDT by theDentist (JOHN KERRY never saw a TAX he would not HIKE !)
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To: Steven W.
Duncan.
4 posted on 04/27/2004 1:56:43 PM PDT by Rebelbase ("Freepers tend to eat their own"--Sean Hannity)
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To: JesseHousman
Will the stock market go up or down?

Yes
5 posted on 04/27/2004 2:00:38 PM PDT by umgud (speaking strictly as an infidel,,,,,,,,,,,,,,,,)
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To: JesseHousman
The people buying and selling stock
6 posted on 04/27/2004 2:01:13 PM PDT by SF Republican (Life ain't fair and I'm glad)
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To: JesseHousman
If you believe what you wrote, go out and make millions! If people are inappropriately over or under valuing companies...and you can tell...you can make a bundle with ease. Let us know how it goes.

Being one of those 'B school boobs' (although not working in asset management) I know what they were taught. Read Aswath Damadoran's equity finance book. He breaks it down as well as anyone. The only thing that matters to the value of the company is how many dollars go in, how many dollars go out to investors, and the respective timing of both flows. However, figuring out when and how much money will come out is incredibly complex...and involves making many assumptions and educated guesses and estimations. I would rather safely guess that those upgrades and downgrades reflect changing long term estimates in the models more than fluctuations in quarterly profits.
7 posted on 04/27/2004 2:02:23 PM PDT by blanknoone (Vote GWB in 04 or your great grand daughter WILL wear a Burqa.)
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To: JesseHousman
Stockholders are responsible...
8 posted on 04/27/2004 2:05:47 PM PDT by Lunatic Fringe (John F-ing Kerry??? NO... F-ING... WAY!!!)
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To: JesseHousman
I grow more certain each day that we are being led down the garden path by a bunch of know-nothing 27-year-olds with MBAs that are capable of seeing only quarterly results, not what the subject company will earn this year, next year or the year after.

Did you see "Trading Places" with Dan Akroid and Eddie Murphy? If not, I would suggest it. The trading houses make money on trades, whether you make money, or lose money doesn't matter. By virtue of trading, they make money.

Consider AMD, they make almost 300% more money than they were expected to (12 cents vs. 3 cents) and their stock drops by ~10%. This isn't a bunch of little guys moving the stocks around; this is the big dogs moving millions of shares around.

9 posted on 04/27/2004 2:07:49 PM PDT by Hodar (With Rights, comes Responsibilities. Don't assume one, without assuming the other.)
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To: JesseHousman
The S & P futures traders in the S&P trading pit are responsible for the intraday yo-yo action of the stock market.
10 posted on 04/27/2004 2:09:18 PM PDT by freedom1st
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To: JesseHousman
Some people are so wealthy but politically motivated and will handle their stock in such a way to drive down the market and hurt Bush.
11 posted on 04/27/2004 2:14:07 PM PDT by INSENSITIVE GUY
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To: dakine
Ping...
12 posted on 04/27/2004 2:20:33 PM PDT by codyjacksmom
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To: JesseHousman
Stockholders.
13 posted on 04/27/2004 2:25:41 PM PDT by PRND21
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To: JesseHousman
Strong economic data, but the market is being held back by fears of the current military situation.

When Fallujah is taken care, stock market will plow ahead in a mini-bull.

14 posted on 04/27/2004 2:25:49 PM PDT by what's up
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To: INSENSITIVE GUY
"Some people are so wealthy but politically motivated and will handle their stock in such a way to drive down the market and hurt Bush."

Name one.
15 posted on 04/27/2004 2:29:06 PM PDT by truth_seeker
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To: JesseHousman
A word of wisdom for grasshopper...

Brokerage firms make money on volume, just like bookies. So it is to their advantage to whipsaw the market about so people get stopped out up and down. Although never admitted to, that is the real purpose for essentially market neutral program trading.
16 posted on 04/27/2004 2:31:06 PM PDT by AmericaUnited (It's time someone says the emperor has no clothes.)
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To: JesseHousman
THE STONECUTTERS!

Who controls the British crown?
Who keeps the metric system down?
We do! We do!
Who leaves Atlantis off the maps?
Who keeps the martians under wraps?
We do! We do!
Who holds back the electric car?
Who makes Steve Guttenberg a star?
We do! We do!
Who robs the cave fish of their sight?
Who rigs every Oscars night?
We do! We do!

17 posted on 04/27/2004 2:36:41 PM PDT by IowaHawk
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To: IowaHawk
Tug o' war between expected higher interest rates (which make markets drop on good news; i.e., inflation coming?) and good earnings. Also, big-time re-evaluation going on, as higher-PE stocks get penalized. Also, worry about a big dump of the so-called "carry trade," where major investment houses borrow at the fed funds rate and invest in junk bonds for the 3% spread -- a business which will get hit hard if the fed raises rates. Lots of stuff. Get an education, deal with the real world, take your lumps as you pay your dues, and you can make money in just about any market.
18 posted on 04/27/2004 2:42:26 PM PDT by MoralSense
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To: JesseHousman
Anyone who thinks they know the market is a fool. When hasn't the market been like a yo yo ?
19 posted on 04/27/2004 2:42:55 PM PDT by John Lenin
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To: JesseHousman
MKT VOLTLTY NDX (WCB)

Market data proves you are incorrect on the volatility issue.
20 posted on 04/27/2004 2:46:44 PM PDT by gipper81
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To: gipper81
Hillary did it.
21 posted on 04/27/2004 2:48:54 PM PDT by jraven
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To: jraven
Hillary did what? She sat on volatility and deflated it???
22 posted on 04/27/2004 2:50:26 PM PDT by gipper81
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To: truth_seeker
Name one? OK. George Soros, who has already said publicly that he would spend his whole fortune if he could be certain of the defeat of Mr. Bush.

And, just btw, Mr. Soros does indeed know how to manipulate mkts, although manipulating both NYSE and NASDAQ would probably be a bit too much for even HIS pocketbook.

23 posted on 04/27/2004 2:53:47 PM PDT by SAJ (So, ya wanna buy a bridge, eh? Lemme see what I've got in stock...)
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To: gipper81
Go easy on 'im, Gipper. He's just making the common error of confusing the formal concept of volatility with the observational concept of, for lack of a better term, ''gross movement'' or ''bouncing around''.

Vol is **WAY** low in the major indicies right now, has been for months and months. Buying 12-month straddles is the way to go just at this time, for there rates to be some shjt hitting the fan after election-time, and the oppies are statistically cheap today, if not exactly cheap in terms of dollars. So, use the e-minis S&P or better yet the mini-Dow options for the straddles (much greater liquidity than e-mini S&P, because CBT has hired mkt makers for that contract).
24 posted on 04/27/2004 2:59:44 PM PDT by SAJ (So, ya wanna buy a bridge, eh? Lemme see what I've got in stock...)
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To: JesseHousman
"Who is responsible...?"

The millions of people who invest. The "yo-yo" averages out with respect to value over time. People who try to get rich quick in the stock market tend to get hosed. The rest of us, who recognize that market volitility is a fact of life, and who don't act on every whim or rumor, tend to do just fine over time. I am still buying just as I have done with regularity for the past 20 years. I intend to keep buying until the time when I will need to tap these assets, and maybe even beyond that time.

25 posted on 04/27/2004 3:00:39 PM PDT by Jerry_M (I can only say that I am a poor sinner, trusting in Christ alone for salvation. -- Gen. Robt E. Lee)
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To: umgud; IowaHawk; truth_seeker; INSENSITIVE GUY; SAJ
and will handle their stock in such a way to drive down the market and hurt Bush..

Let's all take our tin foil off and revisit earth.  It's true that a rich guy can change market prices - so can a poor guy.  You can force prices up by offering to buy at a higher price, and you can force prices down by offering to sell low.  (Am I going to fast for anyone here?)

But forcing up prices up when you're buying is what you don't want to do, but you have to do it in order to buy.  The big guys have some advantages but trading stock without adversely affecting market prices is not one of them.  Us little guys can have a much higher rate of return then the big guys.  They may be rich but they can't double their money like we can.

If anyone knows for sure that Soros or anyone else is selling stocks at artificially low prices to drive down the S&P500 just to hurt Bush, please let me know and I will happily buy all I can.  And if I help Bush by driving up stock prices, that will be good too.

BTW SAJ, great book!

26 posted on 04/27/2004 3:10:13 PM PDT by expat_panama
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To: expat_panama
Expat -- Glad you enjoyed it, and thanks for the kind comment!

Any questions about things (I've got a feeling that I wasn't sufficiently clear on a couple of points), just ask.

27 posted on 04/27/2004 3:30:40 PM PDT by SAJ (So, ya wanna buy a bridge, eh? Lemme see what I've got in stock...)
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To: blanknoone
If you believe what you wrote, go out and make millions!

I have, in spite of the imbeciles who rate good companies. The typical brokerage clod (with his MBA) is lucky to be making $100M/year and will never be a multi-millionaire (which doesn't mean a hell of a lot these days). My point is that these "raters" aren't even pointy-headed geeks or eggheads; rather they're just plodding along to make marginally more than they would managing an Outback Steakhouse location.

As far as the asset management types are concerned, the first thing an investor should ask them is "are you wealthy?" If not, you don't need him.

I don't have an MBA, but I do have an MS and a PhD and I did read the book that B schools fail to use nowadays.

28 posted on 04/27/2004 3:33:52 PM PDT by JesseHousman (Execute Mumia Abu-Jamal)
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To: JesseHousman
"raters" aren't even pointy-headed geeks or eggheads; rather they're just plodding along

IOW they're just like us.  But what we got that they don't is that when we rate companies (using the same data that they have) we can immediately bid on our favorites, whereas they have to turn in their ratings to the boss, show up for a staff meeting,  and argue with a cranky admin officer.

I like to use ratings as a contrary indicator-- I buy up companies with good numbers and sell after the ratings uptick.

29 posted on 04/27/2004 3:52:14 PM PDT by expat_panama
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To: SAJ
"Name one? OK. George Soros, who has already said publicly that he would spend his whole fortune if he could be certain of the defeat of Mr. Bush.

And, just btw, Mr. Soros does indeed know how to manipulate mkts, although manipulating both NYSE and NASDAQ would probably be a bit too much for even HIS pocketbook."

I'd sure be enlightened to learn how this one rich investor, opposed to President Bush, could impact the market, or the elections.

What would he do? Sell a stock too cheap? Would anything like that harm anybody but himself? Be reminded it takes a willing buyer for every sale; it takes a willing buyer for every sale, too.

I wouldn't worry much, over threats buy one rich person.

30 posted on 04/27/2004 11:10:50 PM PDT by truth_seeker
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To: truth_seeker
The usual way that one would go about this, were one so inclined, would be to take a period of mkt vulnerability (a series of down days), and sell the devil out of the SP500 futures that trade on CME, and perhaps other index contracts (QQQ, say) as well. Why? Because thousands of funds worldwide are hedged with these contracts, or trade them outright. They must adjust their portfolios in the event of a heavy move (or series of moves), which adjustment will of itself help tank the mkt. Think Black Monday (because the effect I'm describing is the same, exactly) occurring in ''slow'' motion, over a couple of weeks or a month.

The reverse of this procedure is the essence of the strategy putatively used by the (mythical, in my view) so-called 'Plunge Protection Team', of Bent Willy's days.

Either strategy is doable, to the buy side or the sell side, provided only two things: 1) that the timing is reasonable -- doesn't have to be spot on, merely reasonable, and 2) that our villain (presumably Soros here, but any big player MIGHT be the villain) teams up with other big players to keep the ball rolling for a few days or couple of weeks. The idea is to spook the funds -- the little player simply doesn't matter.

The only wild card, from the villain's standpoint, is: ''What action(s) might the U.S. gov't take to wreck my plan?'', and this is indeed the wildest of wild cards. Gov't hasn't played by the ''rules'', whatever they may be, in such panic situations since at least the coffee market of 1919.

31 posted on 04/28/2004 8:37:54 AM PDT by SAJ (So, ya wanna buy a bridge, eh? Lemme see what I've got in stock...)
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To: JesseHousman
As far as the asset management types are concerned, the first thing an investor should ask them is "are you wealthy?" If not, you don't need him.

Best to also ask if the wealth was made by the individual. Note to investors, Investing in the market today means acceptance of the inherent risks of terrorism.

32 posted on 04/28/2004 9:48:12 AM PDT by KC_for_Freedom (Sailing the highways of America, and loving it.)
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To: JesseHousman
Just why is the stock market acting like a yo-yo out of control?

It isn't yo-yoing.  You either have a very short memory, or don't know what a bouncing market is like.  And when the market is 'in control' capitalism is will be dead.
33 posted on 04/28/2004 4:58:19 PM PDT by gcruse (http://gcruse.typepad.com/)
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To: JesseHousman
I'd say Tommy Smothers. but if you had asked about the Yoko stock market, then I would have said John Lennon.
34 posted on 04/28/2004 5:11:34 PM PDT by isom35
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