we never had a recession yet.the past discription of a recession was always 2 quarters in a row of negitive growth. we never had that. another thing to think about.we never had a recession in the past that housing prices didnt get hit.is that next?
Actually, it was a couple months ago we technically did have a recession with two consectuive quarters of neg. growth...
____________________________________________________ Correct, a decline in real GDP for two consecutive quarters technically qualifies as a recession. Also, growth in GDP of less than the 3% (long term trend) also qualifies as a recession. And a prolonged recession qualifies as a depression... So, technically, we might be teetering on the brink of a depression? Are the growth figures out for the second quarter yet? I think we were right at 3 percent in the last 3 quarters. Correct me if I'm wrong.
I hope Don can give more insight than I. I have not seen a market like this before. I started trading in 1979 right about the time of the taking of hostages in Tehran. At that time, energy stocks were very strong. I bought some drilling and oil stocks, learned about options (I thought I learned....expensive lesson), and the rest is history. I lucked out and did not get involved in the gold and silver contracts at that time. Fortunes were made and lost overnight. But that was a rigged game and hopefully led to some internal market controls in the commodities side of the markets. I know 23 years seems like a long time, and it is. But not long enough to have experience a market like this. The real difference is that there seem not to be any truly strong sectors. Conventional wisdom seems to have gone by the wayside now. Maybe this time really is different (sound familiar?). Gold stocks? Very high end and very low end retailers? Tobacco? Non durables? The obvious candidates are now just as likely to be the next to have exposure to "accounting irregularities" and other onerous mismanagement as any other stock in any other sector. Unless I am mistaken, in every other bear market (at least since Reconstruction), there was no significant period of time that money could not be made on the long side. It was just a matter of moving money into the right sectors. This time, however, it seems there really is no place to hide. Defense stocks (not defensive stocks) have shown some relative strength, but not across the board. And what industry is more likely to have financial skeletons in their closets? Home builders certainly seem to be risky for all the aforementioned reasons plus a not unlikely turn in their own perhaps overheated sector. So no, I cannot shed any great enlightenment that would add to what has been said in this thread already. Not to be presumptuous, but I would guess that Don would say to just trade what the market gives you. Realize we are in a downtrend. Trade with a downward bias. Short more, buy when you expect a bounce, be on both sides. Nothing goes up or down in a straight line. As daytraders, we need to be quick and play the small moves. There are many many bounces in which money can be made on the long side. Just as during the great bull run of the late 90's there were always opportunities for money to be made on the short side. Timing is just more critical. We certainly have volatility, and that can be our greatest natural resource as traders. Unless the market goes to virtually zero, or volatility and volume disappear, we have plenty of opportunity. (And there is not yet any indication that any of these things are really about to happen). PS....I am NOT old enough to know what a Depression would be like!!!!!! (yet I am hopeful I will never have to learn).
"Also, growth in GDP of less than the 3% (long term trend) also qualifies as a recession. And a prolonged recession qualifies as a depression... So, technically, we might be teetering on the brink of a depression? Are the growth figures out for the second quarter yet? I think we were right at 3 percent in the last 3 quarters. Correct me if I'm wrong." calling a slightly less than 3% growth rate a depression is silly.you have no concept of what a depression is. you cant have a depression or even a recession for that matter when housing is setting records,auto sales are at all time highs and when resturants are at all time highs. we technically never even had a recession because we only had 1 quarter of slightly negitive growth. http://www.bea.gov/briefrm/gdp.htm
"SilverBullet Senior Member Registered: Jun 2002 Posts: 118 07-19-02 06:21 PM Actually, it was a couple months ago we technically did have a recession with two consectuive quarters of neg. growth" nope we didnt. http://www.bea.gov/briefrm/gdp.htm
Possibly we should have a chat/thread set up at ET, and invite as participants/moderators those who 'traded' through the early 70's to describe their experiences, before we lose all that valuable info. My first trade was in May 1970 and I continued actively trading through the subsequent bull and big bear of 1973/1974. I also did my market learning during the go go late 60's bubble top which culminated in the 1974 bottom. I can still remember the exact day of the bottom in 1974, what i was thinking and wearing that day, funny how vivid it still is. I recall the talk radio shows during the bear also. This bear means so much more to me because I can relate now to then and it jogs my memory. I now trade quite actively but only for the mental stimulation. I can unaquivically state that there were daily opportunities then as now, and the mkts will not go away, volatility will remain a force but will jump venues from stocks to commodities etc. I would be happy to answer any questions if posed here also.
Thats not exactly true, look at a chart of the DOW in the 1970's, that was a bear market. Nothing moves, there is no volatility or liquidity. Bulls nor bears make much money, everyone just kinda has to grit their teeth and get through it. Brandon
I dont have any direct experience, just research but I thought that same. This summer the grain markets have been very good to traders, the biggest thing to get used to is less pullbacks. When you said that there will be daily opty and volaitlity jumps venues, I assume you would mean that the opportunity does as well? Thanks for taking the time to post. Brandon
"Possibly we should have a chat/thread set up at ET, and invite as participants/moderators those who 'traded' through the early 70's to describe their experiences, before we lose all that valuable info. lol. nothing is the same.think about it.there was no internet.there were no computers to speak of.there was no ability to daytrade like we do now.there were no instant charts by the click of a button on the internet.there was no fundamental info with the click of a button.there was no cnbc. that is why the moves are so fast now.everyone gets the info at the same time.