Comments on: From complacency to dread in three weeks… What’s next for the markets? http://www.moneyhoneyblog.com/from-complacency-to-dread-in-three-weeks%e2%80%a6-what%e2%80%99s-next-for-the-markets/ There Is Nothing To Fear From Truth Wed, 21 Dec 2011 06:16:13 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: goldstandard http://www.moneyhoneyblog.com/from-complacency-to-dread-in-three-weeks%e2%80%a6-what%e2%80%99s-next-for-the-markets/comment-page-1/#comment-2054 goldstandard Thu, 20 May 2010 05:56:56 +0000 http://www.moneyhoneyblog.com/?p=622#comment-2054 Petra, thanks for sharing YOUR views, at the first place. You fill my mind with optimism. I love bear markets, because I believe I am good at waiting. My friend told me, at least. What I write might sound like a joke to some people, but I really mean it. Nice day, G. Petra, thanks for sharing YOUR views, at the first place. You fill my mind with optimism. I love bear markets, because I believe I am good at waiting. My friend told me, at least. What I write might sound like a joke to some people, but I really mean it.

Nice day, G.

]]> By: Petra http://www.moneyhoneyblog.com/from-complacency-to-dread-in-three-weeks%e2%80%a6-what%e2%80%99s-next-for-the-markets/comment-page-1/#comment-2052 Petra Thu, 20 May 2010 05:02:57 +0000 http://www.moneyhoneyblog.com/?p=622#comment-2052 Thanks for sharing your views. In my opinion this decade will be much more favorable for trading or short term investing; wouldn't be surprised if 10 year returns turned out to be quite poor again. Think we're still in a primary bear market (but cyclical bull - for now) which could well go until the end of the decade. In the short term I'm increasingly thinking we may see something more serious than a 10-20% correction coming soon. Not much clarity at the moment, but judging by technicals, as well as intensifying funding stress (rising Libor) and uncertainties about Europe, it could get ugly for some months. I certainly agree with you on paper money; it will buy less over time. In the short term it is looking like we may see deflation first; of course the govt and the Fed would fight deflation at all cost, undoubtedly with more spending and money printing. Thanks for sharing your views. In my opinion this decade will be much more favorable for trading or short term investing; wouldn’t be surprised if 10 year returns turned out to be quite poor again. Think we’re still in a primary bear market (but cyclical bull – for now) which could well go until the end of the decade. In the short term I’m increasingly thinking we may see something more serious than a 10-20% correction coming soon. Not much clarity at the moment, but judging by technicals, as well as intensifying funding stress (rising Libor) and uncertainties about Europe, it could get ugly for some months.

I certainly agree with you on paper money; it will buy less over time. In the short term it is looking like we may see deflation first; of course the govt and the Fed would fight deflation at all cost, undoubtedly with more spending and money printing.

]]> By: goldstandard http://www.moneyhoneyblog.com/from-complacency-to-dread-in-three-weeks%e2%80%a6-what%e2%80%99s-next-for-the-markets/comment-page-1/#comment-2006 goldstandard Mon, 17 May 2010 18:37:43 +0000 http://www.moneyhoneyblog.com/?p=622#comment-2006 Hi Petra! Pleasure to read your article. I am rather simple person, so I do not pretend I understand everything. Forgive me. As of today, I do not believe stock is that cheap. (I use historical 10 years average P/E instead of 2 years forward). I do not believe that S&P 500 is worth more than 900 - 1000. But, they are getting cheaper (greedy grim in my eyes :-), especially European stock, in dollar terms. Not necessarily in Euro terms. I made my first purchase in 2010 - just last week. (SNY @ 32.5, no secret) I believe it is not a big mistake to overpay a bit for a good company. As Graham said, it is only second most dangerous mistake investor can make. The first one is to buy junk at par in times of high economic activity. Surprisingly, what I can see is that the more speculative the stock is, the more it rallied during the past 12 months. I do not think the stock I bought will go straight up from now on. I think there are chances it will go down. Actually, I would love to see that to buy more. However, I do not think either that any paper currency is worth owning long term, at any rate. It is actually very difficult to say whether a stock of P/E 25 is expensive or cheap, because cash gives me zero. People were buying stock at S&P = 1500, as well..... I believe, good companies will not disappear and they will do well over time. That is all I can say about the future of the stock prices. Not much..... Well, maybe one more thing: Euro, dollar, koruna will all buy less over time. We have moneyprinters everywhere. That should be positive for stock, even if there are some limitations. Buffett wrote an article about that long time ago, called "How Inflation Swindles the Equity Investor." I did not understand the details, but the outcome is clear. Do not bet that equities can save you from inflation. There is also one other weak point of the "money printing theory" and its positive impact on security prices, which makes me a bit nervous. Zero interest rates alone are not enough to promote spending and avoid recession. Continuing stimulus is peraps needed as well. And that might be politically difficult. Here is Mr. KOO´s view why this might not work as expected: http://www.youtube.com/watch?v=6k0_a1JS5hU So the question is again: will they release stimulus 2.0, 3.0, 4.0 ? No one knows, and we have to live with that. Mr. KOO made one especially interesting point: "it might be politically difficult to pass continuing stimulus in democracy DURING PEACE TIME. But, the USA are already at war (s), are they not? nice day to all, G. Hi Petra!
Pleasure to read your article. I am rather simple person, so I do not pretend I understand everything. Forgive me.

As of today, I do not believe stock is that cheap. (I use historical 10 years average P/E instead of 2 years forward). I do not believe that S&P 500 is worth more than 900 – 1000.
But, they are getting cheaper (greedy grim in my eyes :-) , especially European stock, in dollar terms. Not necessarily in Euro terms. I made my first purchase in 2010 – just last week. (SNY @ 32.5, no secret)
I believe it is not a big mistake to overpay a bit for a good company. As Graham said, it is only second most dangerous mistake investor can make. The first one is to buy junk at par in times of high economic activity. Surprisingly, what I can see is that the more speculative the stock is, the more it rallied during the past 12 months.

I do not think the stock I bought will go straight up from now on. I think there are chances it will go down. Actually, I would love to see that to buy more. However, I do not think either that any paper currency is worth owning long term, at any rate. It is actually very difficult to say whether a stock of P/E 25 is expensive or cheap, because cash gives me zero. People were buying stock at S&P = 1500, as well…..

I believe, good companies will not disappear and they will do well over time. That is all I can say about the future of the stock prices. Not much….. Well, maybe one more thing: Euro, dollar, koruna will all buy less over time.

We have moneyprinters everywhere. That should be positive for stock, even if there are some limitations. Buffett wrote an article about that long time ago, called “How Inflation Swindles the Equity Investor.” I did not understand the details, but the outcome is clear. Do not bet that equities can save you from inflation.

There is also one other weak point of the “money printing theory” and its positive impact on security prices, which makes me a bit nervous. Zero interest rates alone are not enough to promote spending and avoid recession. Continuing stimulus is peraps needed as well. And that might be politically difficult.

Here is Mr. KOO´s view why this might not work as expected:

http://www.youtube.com/watch?v=6k0_a1JS5hU

So the question is again: will they release stimulus 2.0, 3.0, 4.0 ? No one knows, and we have to live with that. Mr. KOO made one especially interesting point: “it might be politically difficult to pass continuing stimulus in democracy DURING PEACE TIME. But, the USA are already at war (s), are they not?

nice day to all, G.

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