Asian markets crashing

[notesdev]

Japan and China down nearly 3%, Singapore down 2%, still a good chunk of the session to go.

It's going to be one interesting week...

Protect what you have, people and do not expose any of your wealth to the stock market without being FULLY hedged.

[gmoney]

1. Crashing?

Isn't that a bit alarmist for 3% in a volatile market, mid-day?

[aquart]

2. Wealth?

[notesdev]

3. Not alarmist, just cautious

I fully expect the US market to crash (as in 30%+ drop) sometime during the next three months, and with the Asian markets having strong dependence on exports to the U.S., a week of really bad markets could potentially start in Asia, as their week begins and ends half a day before ours.

[billyoc]

4. Check. I've got half a loaf of whole wheat bread and a pack of hot dogs.

Do you think I'm top-heavy in commodities?

[Psephos]

7. sounds like you could lighten up a bit on the pork belly derivatives n/t

[billyoc]

9. I had to naked short them at the bodega, good thing they know me.

:rofl:

[seeviewonder]

12. Too bad shit doesn't work like that in real life!

I'd be selling straddle options to people based on how much beer I drink on a given day sometime next month. I wouldn't know what to do if I was a bookie for myself!

[Psephos]

35. lol n/t

[cliffordu]

15. You need to diversify with some relish and a little mayo.

[billyoc]

27. Whoah! What do I look like, Blackstone Group?!

:rofl:

[glinda]

5. I am a bit ignorant on this stuff. What does fully hedged mean? Husband has retirement

in part in Asian stocks, etc....

[seeviewonder]

11. In general, hedging means to have some of your positions on a stock

or other investment invested in the opposite position to limit any potential losses on that security. This also could limit the upside opportunity when the market rises but it usually works pretty well when the market slides. There are many techniques available to investors to hedge against loss and I recommend seeing your broker for some details. I personally use options on all of my investments that I can but bear in mind that these are risky in their own regard and are not for every investor.

[seeviewonder]

20. I would also like to recommend a website for you to browse around.

I used this site as one of my resources for passing my securities exams. But in addition to this type of in-depth information, the site has several articles for beginners/novices in investing. Just about any topic in investments that you could think of is addressed on this site and often a single topic is referenced in more than one article. The site is completely free and they even have a stock simulator game that was added a couple years ago if you get bored reading the articles. And, as always, there are several people here on DU that have knowledge in this field and I am sure that all of us would be glad to answer any of your questions if you are unable to find the answer elsewhere.

The address for the site is:

[glinda]

32. thank you

[dixiegrrrrl]

34. Cool address..thanks for sharing it /

Welcome to DU, too.

[seeviewonder]

36. No problem, glad I can help!

Thank you for the welcome, also!

[Tuesday Afternoon]

6. I bought an extra 8 pack of TP and stocked up on canned goods.

Am I good?

[Po_d Mainiac]

28. Some can crap can speak for a whole roll of TP n/t

[FreakinDJ]

8. Japan's economy rebounds in 2Q on export growth

Japan's economy rebounds in 2Q on export growth

TOKYO (AP) -- Japan's economy broke free of recession in the second quarter, the government said Monday, expanding 3.7 percent at an annual pace on a strong rebound in exports and joining Germany, France and other economies in recovering from the global financial crisis.

http://finance.yahoo.com/news/Japans-economy-rebounds-in-2Q-apf-2340371502.html?x=0&sec=topStories&pos=main&asset=&ccode=

interesting.....

3 month chart...............http://finance.yahoo.com/q/bc?s=%5EN225&t=3m&l=on&z=m&q=l&c=

[seeviewonder]

10. I would recommend using leveraged bear etf's in this case.

I have used some Direxion Bull 3X ETF's for the past few months and I've done fairly well against the S & P 500. I think I'll test the water tomorrow with some of the Bear versions of these ETF's. These things are made for day traders (like myself) and are quite risky so if you consider using them in your portfolio I would ask your broker/advisor beforehand. Just a thought I would like to pass on to everyone.

[swag]

13. Ticker or CUSIP, please: what's your preferred hedge?

[seeviewonder]

14. What security did you have in mind to hedge against?

[notesdev]

18. My preferred hedge is to limit exposure

Just like any other form of gambling, don't put up what you can't afford to lose.

I'm more interested in markets and economics from a socio-political point of view than anything else.

But I know a lot of people who know very little about these things are up to their necks in the markets, with their retirements sitting in 401k and other investment vehicles - those people got raped last fall and are about to be raped again.

[seeviewonder]

19. You definitely make a great point.

My father lost almost 30% in his 401(k) and about 40% through his ESOP plan. He is working through the motions now, though, and things are starting to look much better for him after we reallocated his portfolio a little.

[notesdev]

21. I know someone who lost $1 mil last September

He's a successful professional, late in his career, business owner too. Too busy to pay attention to the markets, but had his money in there anyway. I've been trying to warn him this is being set up as pump-and-dump again, he's too happy about the rally making back some of what he lost to listen to me. After all, I don't have the kind of money he does, so what do I know, right?

[seeviewonder]

22. I agree with you about the next pump and dump scenario

and that people with money think that average people don't understand money. In my opinion, the amount of money is arbitrary. For example: if I make 30% on my investment of $1,000 and you make 30% on an investment of $100,000, we both are now 30% better off than we were before. The only difference is purchasing power! Just because I am not wealthy does not make me an idiot when it comes to money. I will tell you, though, if I had enough money in the market to lose $1M, I guarantee you I would be paying close attention to my portfolio everyday!

[notesdev]

16. Shanghai Exchange down 5%

If this turns out to be nothing, I promise not to post about market movements again.

The way I see it, the fundamentals have been screaming for a strong move downward (S&P P/E @ 140?? WTF?) and this may be all the push needed.

[seeviewonder]

17. Have you seen the Parabolic SAR for the indexes?

It, too, screams "I'm gonna fall quickly!"

[Po_d Mainiac]

29. That P/E is nuts!!!

It also tells me that the lows will be revisited. :nuke: SDS.N is looking very attractive

[seeviewonder]

33. P/E's like that aren't even seen with micro caps very often!

[CoffeeCat]

23. We pulled out of the stock market...

...early last fall. I say "we", but it was really my husband taking the money out--because I
had begged and pleaded for six straight months to get our money out.

We are still out.

For the life of me, I don't know what is going to happen. My intuition tells me that we're still dealing
with a house of cards.

My husband has seen the recent US market gains and is questioning my judgement. I keep telling him to
wait and see...so far we're still out.

I don't want any part of that roulette wheel!

[notesdev]

24. Make him promise

to stay in the safest possible investments at least until the new year. You won't regret missing the coming crash.

Some final numbers coming in on some Asian markets for the day... Shanghai down 5.8%! Nikkei down 3.1%, Taiwan down 2%, Australia 1.6%, Hong Kong 3.4% (not closed yet), Bombay down 2.6% (not closed yet).

Going to grab some sleep so I can watch how this plays in Europe. This looks like it may be the most interesting week in the markets since last fall.

edit: Euro markets just opened, London and Paris starting off down 1%.

[CoffeeCat]

25. We took all money from the stock market...

...and put it in US Treasuries.

[snot]

26. no expert here either

but i pd a price for not getting out of stock last fall -- this last week while the market was doing better, took the chance to pull most of what I still had in stock OUT. Even my broker was concurring at this point.

i don't have the stomach for options, but i can at least get out of the market-cum-wealth-destruction-machine. i personally don't see any reliable bottom being reached before 2011 at the earliest.

Here's some info I put together for my sis:

$2 Billion in stock insider sales in two weeks
This is vs. only $73 million in insider buys.
http://www.zerohedge.com/article/last-weeks-insiders-transactions-1-buys-60-million-136-sells-over-115-billion#comments
http://pragcap.com/despite-green-shoots-insider-selling-picks-up >

8/11/09 Robert Prechter "Quite Sure" Next Wave Down Will Be Bigger and March Lows Will Break
http://finance.yahoo.com/tech-ticker/article/299205/Bob-Prechter-%22Quite-Sure%22-Next-Wave-Down-Will-Be-Bigger-and-March-Lows-Will-Break
Be sure to watch the video in the link, located in the upper left corner.
In late February, Robert Prechter of Elliott Wave International said "cover your shorts," and predicted a sharp rally that would take the S&P into the 1000 to 1100 range.
With that prediction having come to pass, Prechter is now saying investors should "step aside" from long positions, and speculators should "start looking at the short side."
"The big question is whether the rally is over," Prechter says, suggesting "countertrend moves can be tricky" to predict. But the veteran market watcher is "quite sure the next wave down is going to be larger than what we've already experienced," and take major averages well below their March 2009 lows.
Yes, the late 2007-early 2009 market debacle was just a warm-up to what Prechter believes will be the bear market's main attraction. In this regard, he says the current cycle will echo past post-bubble periods such as America in the 1930s and England in the 1720s, after the bursting of the South Sea bubble.
The 2000 market peak market a "major trend change" for the market from a very long-term cycle perspective, and the downside is going to continue to be painful well into the next decade, Prechter says. "The extreme overvaluation, the manic buying and bubbles in the late 1990s mid-2000s are for the history books - they're very large," he says. "The bear market is going to have balance that out with some sort of significant retrenchment."

New interview with Nassim Taleb and Nouriel Roubini (the guys who predicted the crash): http://www.businessinsider.com/henry-blodget-taleb-you-fools-dont-understand-that-were-doomed-2009-8
8/12/09 from Black Swan Nassim Taleb:
* We're all in denial.
* We're replacing private debt with public debt.
* We're not dealing with the cancer in our banking system.
* We're not making the structural changes we need to make.
* Obama's rewarding the fools who got us here (Summers, Bernanke, Geithner)

New interview with Elizabeth Warren: http://www.businessinsider.com/henry-blodget-elizabeth-warren-we-have-a-real-problem-coming-2009-8
8/12/09 Elizabeth Warren: "We Have A Real Problem Coming..."
* The banks are still insolvent.
* That little tweak to mark-to-market accounting a couple of months ago has allowed us all to plunge into deep denial.
* Now that the banks are allowed to lie about what their toxic assets are worth, they'll never sell them (because if they did they would have to write them down).
* The smaller banks are undercapitalized and will have to raise another $12-$14 billion. And so on...

And PS: 8/12/09 Markopolos: CDS Fraud Will Make Madoff Look "Small-Time"
Memo to regulators: be forewarned about frauds in the credit-default swap market. They'll make Bernie Madoff's $65 billion fraud "look like small-time."
That's what Harry Markopolos -- Madoff's whistleblower ignored by federal investigators -- is saying, anyway.
New York Post: says there are evildoers out there who will make the Ponzi scum "look like small-time." Markopolos gave a speech to 400 of the faithful at the Greek Orthodox Church in Southampton and predicted major scandals will soon be revealed about the unregulated, $600 trillion, credit-default swap market. "To put it in simple terms, it is like buying fire insurance policies from five different insurance companies on your neighbor's house and then burning down the house," he said.
It's not clear if there are frauds that he knows of, specifically, that he's not disclosing publicly, or if it's just his how the market works -- in which case, he's basically just parroting what a lot of people who hate "naked" CDS have been saying. Either way, we suggest Mary Schapiro or the CFTC pay him a call and get a clarification.
And the derivatives bubble is even larger than the CDS bubble
Note: CDS is only a $60 trillion market
The derivatives market is over $1000 trillion, that's a quadrillion

[Po_d Mainiac]

30. Watch this AM's Empire State index turn the sheeple around...groan n/t

[notesdev]

31. Stock Futures Point to Plunge on Wall Street

http://biz.yahoo.com/ap/090817/us_wall_street.html?sec=topStories&pos=main&asset=&ccode=

Does it still look like I'm overreacting now?