Prechter, Is this stuff Possible??

Discussion in 'Trading' started by stocon, Nov 30, 2002.

  1. stocon


    He talks of triple digit dow, depression and deflation. Is there any credibility to his very persuasive arguements? Is it different this time and worse than a recession? Hasn't our stock market contracted already the most since 29? I would love to hear people's input on this. Thx, Steve
  2. stocon,

    Check out the thread, "Say what you want about the wave". I started it hoping it would generate some interesting discussion about Prechter and the wave. There are quite a few good comments in there, and there is a lot of the usual inane banter too. Sorry about that. I wasn't a moderator then or I would have started the thread in the forum I am privileged to moderate, Strategy Trading. It would have been easy then to delete the off-topic and useless comments that infiltrate so many of these threads.

  3. Prechter is as credible as those who predicted the end of the world at the turn of the millennium based on their interpretation of the Bible, or those who predicted the same based on their interpretation of Nostradamus.

    Is Prechter's vision possible? Indeed.

    Is it probable? That is a different issue entirely.

    Given the available facts and historic trends, what Prechter is suggesting is one possible outcome. There are other scenarios that may play out as well. We could just as easily have massive inflation as deflation, depending on how all the central banks of the world play it.

    War, pestilence, plagues, etc. can certainly be a factor, but are difficult to predict.

    Has our stock market contracted the most since 1929? Sure it has, but has it contracted AS MUCH as 1929 on a percentage basis? If you look at the entire market, using the Wilshire 5000 as an indicator of all stocks (see attached graph), you will find that we have a long way that we could go to the downside to match the percentage decline of the DOW in 1929.

    Will it happen? Who knows?
  4. You never know ...
  5. Ammended attachment of Wilshire 5000:
  6. stocon


    Are there any so-called safety nets or structural changes to our system that would prevent a recurrence of the 30's?? I live in a lower middle class city and people are buying houses for 250,000 and driving 30,000 suvs.leases I guess . Kinda spooky. Some of these suvs are unregistered, uninsured, and most likely headed for repo land, but how'd they get the credit in the first place?? I remember reading about generational mortgages in Japan just before their bubble popped. I know that stuff is anecdotal but it's extreme.:( :confused:
  7. Safety net? I think the Fed calls that a printing press with green ink.
  8. I subscribed to an Elliot wave service summer 2001.

    They were predicting a big summer naz rally.

    Every other (non EW) indicator said short, so I stayed flat and missed a huge shorting opportunity.

    They eventually put out an "alternate wave count" that explained why things turned out the way they did. (this happened more than once)

    My criticism of EWavers is that they get WAY too wrapped up in EW, to the exclusion of everything else, even other credible forms of tech analysis.

    The stuff others mention in this thread about debt does have something to it, there has to be some consequence to it. But I think that Pretcher goes to the logical linear extreem on an issue, then plugs his ears to contradicting and mitigating circumstances as they emerge. His trading call record is terrible.

    I think is is useless to attempt to predict too far into the future (if you are a trader). The farther out you go, the less acurate it is, and the more likely to prejudice you when new evidence comes to light
  9. You don't have to use Elliot Wave or listen to Prechter to see the possibilities for the market going forward. The DOW was less than 990 as recently as 1982. How much of this territory it is going to retrace in the future is anybodys' guess. Adding trend channels to any DOW weekly or monthly graph will show it in a down trend for about 21 months and staying near the bottom of those trend channels. At the slope of those channels it should retrace to under 1000 by 2012 to 2014. Is this going to happen? No one knows. It is interesting to look at a long term graph of the DOW and see the bubble starting in about 1985 and then peaking in January of 2001. However at any point it could break out of the trend and reverse course to the upside. In using the EW for this prediction you have to remember that the projection is only valid if none of the retracement levels are broken. If they are broken then all bets are off.
  10. WarEagle

    WarEagle Moderator

    The problem with Prechter is that he's been saying the same thing for over 10 years. He missed the whole bull move as a result. The accuracy of a broken clock comes to mind. I'm surprised he still has a single follower. Who knows, maybe he'll be right....this time.
    #10     Nov 30, 2002