Public panicing?

Discussion in 'Psychology' started by timscott, Sep 15, 2008.

  1. I've been trading over ten years and non-trader acquaintances I talk to infrequently (say once or twice a year) were calling today.

    Probably 8 calls in all asking wtf? Smells like quite a bit of concern from John Q. Public.

    My take is we have more downside and this bottom will be the washout / capitulation folks have been looking for.

    Anybody else getting calls from non traders?

    Contra -indicator?
  2. Probably.. The real washout about to occur is the erasure of a crapload of equity by anyone net short CDS positions (most banks, insurers, etc?)

    Corporate bonds will be a sell until the portfolios are liquidated.

    The problem with an erasure of equity is that it is fundamental. That actually lowers book values. So when the market capitulates, there will be no fundamental reason for it to *bounce* back up other than multiple expansion.

  3. A waiter at a restruant who I go to every couple of months asked me if I thought his #SS check which is direct deposited into a washington mutal checking account was going to be safe with WM. In, other words would his check still be deposited if WM went under.

  4. My big fear is that we get "Nikkei syndrome" over here: a decade or more of sideways movement. The economy emerges from recession but growth is slow, earnings are flat, 401(k)s are trashed and nobody's buying.
  5. Mav88


    I'm part of John Q Public- I'm feeling panicky/depressed at watching my 401b disappear and thinking I'll have to work 10 years longer than I thought.
  6. dont


    Yup suddenly I am getting comments like,
    "they should hang the fuckers out to dry", "derivatives weapons of mass destruction"

    Instead of the usual "are you OK" i.e haven't you blown up yet!
  7. S&P now: 1188
    S&P on July 17, 1998 (over 10 years ago): 1187

    We've already had the dace of sideways movement.
  8. I guess if people's systems are affected (as mine are) by this change in action, they would be delayed in profiting, but should not be afraid their systems are worthless. If retail 'investors' are panicking, that is to be expected, because they watch the news and actually believe it.
  9. But still not a correction. Dow to 7000.