Let me add my thanks - to both Chas and Dat, for saying some things that very much deserve to be said. Was writing somewhat along the same lines on Silicon Investor. I hope you'll forgive me if I try to take the subject seriously: Just watching Aaron Brown, discussing the stalled plans to re-build on the WTC site... alongside the latest ugly news from the Middle East... began to see this all as of a piece... You know the thing about tallest buildings coinciding with market tops... seems like we've got something of the reverse taking place, or having taken place... The 9/11 events produced unprecedented gaps in the charts - corresponding, of course, to unprecedented trading halts - and the ensuing rally, along with the almost immediate successes in Afghanistan, may have lulled us into accepting the illusion that we were already effectively "over it." There was probably something attractive about simply turning away from aspects of the events that, beyond the human tragedy, are too maddening to contemplate - the horrific pun commemorated in the date, the resonance with the Babel myth, the uncompromising assault by the most twistedly self-conscious victims of "world trade" on the center of world trade, and on and on: How could we all watch those great towers imploded to their foundations without also taking up, at least subconsciously, the idea of bringing everything and anything back to essential foundations. That goes for stock prices, too - it's almost so obvious that it's virtually presumed. What transpired in about an hour or two on 9/11 and also in the days thereafter has been re-playing, almost literally, at least symbolically as well as in price depreciation, in the markets, which in turn merely reflect self-doubt awakened in our culture, and brought home again and again - in one bankruptcy and fraud and disappointment and reversal after another, and in the persons of thieving CEOs, dishonest brokers, perverted priests, or a President who increasingly appears as unsure and altogether overmatched as even many of those who originally supported him feared he might turn out to be. The ongoing re-assessment of the '90s, alongside the simultaneous evaporation of stock values and the self-confidence that economic outperformance reinforced, is of a piece with the same macrophenomenon. In terms of stock prices, the skyscraping Clinton Era is already half-collapsed, at least: Breaking its underlying trend may already verge on its virtual erasure. Not just symbolically, breaking the Dow and S&P down so miserably even begins to push us back through the "American Morning" of the '80s. We still don't know how profound the threats to the economy and even to the country really are, but, at the very least, it's a lot more difficult now simply to presume that the next few years cannot possibly be as bad as the Watergate/Oil Embargo/End of Affluence era... http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=17778021
Doing a quick little check of p/e ratios I think the Dow is trading around 21 (at the close of market today); however IP, EK and T are all running losses, so I couldn't figure those p/e's into the calculation. Certainly a true p/e of the dow is probably around 25.
There doesn't have to be classic "capitulation" for the market to end a severe slide. Look at a chart of the DOW in 1974 (Bigcharts.com has it) It was the worst decline in the post war era. Look how many down days in a row there were in August and September. At the eventual bottom in October, I can imagine the sentiment being the darkest in a generation. But there's wasn't a classic "crash" that ended that decline. It was very choppy and ended on a whimper. I think the pyschology is different after such a brutal decline, rather than a "bull market correction" like what happened after '87 and '98. Hopelessness replaces panic.
Yea, I think that's just CNBC crap. The 29 crash didn't just end one day either. It just slowly leveled off around Sept of 32. Honestly I don't know an example of "capitulation".
knows (or does now) that I believe that President Bush is the man for the hour. Unquestionably. Impressive post, Ky, and not because you thanked me.