Stocks tumble on fresh worries about banks Wall Street tumbles on concerns about banking sector; bank shares plunge, lead market lower * Tim Paradis, AP Business Writer * Tuesday January 20, 2009, 3:22 pm EST NEW YORK (AP) -- The dawn of the Obama presidency could not shake Wall Street from its dejection over the banking industry's growing problems. After hearing the new president's inaugural address Tuesday, investors went back to unloading stocks, sending the major indexes down more than 3 percent and the Dow Jones industrials down more than 300 points. Traders on the floor of the New York Stock Exchange paused at times to watch the inauguration ceremony and Obama's remarks, but the transition of power didn't erase investors' intensifying concerns about the struggling economy. Obama said the economic recovery would be difficult and that the nation must choose "hope over fear, unity of purpose over conflict and discord" to overcome the worst economic crisis since the Great Depression. http://finance.yahoo.com/news/Stocks-tumble-on-fresh-apf-14106468.html
The support levels have already been mentioned, and in addition there is some minor support around 650 in the S&P. You said, Port, that things haven't been this bad since the 1970's. I'd certainly agree, having been in the job market in the 70's. But it seems to me that the economic situation has the potential to become far worse than in the 70's recession-stagflation period. The difference is that the US was in far better financial shape going into the Arab Oil Embargo and the other economic woes of the 70's, and thus the bite-the-bullet Volcker cure was eventually able to pull us through without much permanent damage. Going into the present-day "Greenspan" recession, however, the country was already on its financial knees after 35 years of the government's coffers being raided by the "defense" industry and consequent years of unwise and unwarranted military adventurism; thus the US spent 7.5 times or more per capita on its military than other developed nations. Add to this runaway medicare costs, because of the unbreakable strangle-hold of the US Medical Cartel, and top all of this off with excessively loose money policies leading inevitably to greed-driven, uncontrolled exploitation of the credit markets, and even fraud, and you have the ingredients of financial disaster. As part of our headlong rush to instant "happiness," the self-proclaimed "greatest nation on Earth" became addicted to borrowed money and credit. Our "stalwart" financial institutions were only too happy to exploit our addiction, and finance it by selling junk to the rest of the world under false pretenses. Now, as the much maligned Rev. Wright has noted, America's Chickens have come Home to Roost. We are not experiencing a deep recession, we are experiencing a financial disaster of our own making. Are we in a debt death spiral or just a very scary tailspin with a happy ending? Who knows? But this present situation seems to me to have the potential to be much worse than what we experienced in the 70's. [/i] Out of all the chart patterns, the ones that have consistently worked FOR ME are the symetrical triangle and the head&shoulders. Nothing else seems to have been as reliable. For example, BAC and BRLC were in symetrical triangles at one time similiar to this one. After a huge move to the downside, both started to trade in this triangle pattern and then after breaking to the downside of the triangle came massive down moves that lasted weeks. I know about the bailout, I know about government intervention, but I know what I went through on stocks that started to get into this pattern. My trader's sense tells me that we have one more large down move to go before we can think about "the bottom". The economy seems worse now then at anytime since the 70s. Neighborhoods with foreclosures in mass, large established car dealerships closing their doors, etc. This was not occuring during 2002-2003. BTW, look at the NAHB index and how its at the lowest point EVER. I can only surmise from a technical and fundamental perspective that "the bottom" lay somewhere below the 2002-2003 lows and then a recovery to the old 2007 highs will not happen for at the very least 5 years, but most probably 7-8 years. [/QUOTE]
You do realize that 6000 Dow points ago, you were long everything...and that you were saying the same bullshit... Doesn't your family still love you?
Do keep mind though that the sp00z lost 50% of its value in 1974 & 2000-02, yet in both cases regained most of it in 2 years. When bear markets end, the rebound is v shaped even if the econ recovery isn't.