Heads Up

Discussion in 'Trading' started by Digs, Jan 24, 2008.

  1. Digs


    The month of Jan 2008 has shown to me that the Dow can drop 600 to 1200 points faster than Carl Lewis. ( 100 m sprinter LA games).

    Electronic trading and fear combined with the mass of retail online trading a Oct 1987 crash still is a very real physically possibility.

    Sure there are limit down pauses, but for the DOW to gown 3000 to 5000 points in a week or two is very possible.

    Also with 45 trillion dollars of futures contracts out there, there is plenty of positions to motivate such a event.

    I guess the signal for this to happen is a very clear ASSET DEFLATION event. What would this be, unemployment jump, employment insurance claims jump, house price falling, interest rates jump.

    So 1987 can be repeated...and I dont think the PPT would be able to stop it.