the market in 1929-31

Discussion in 'Trading' started by andrasnm, Oct 4, 2008.

  1. consider that, after the crash of 1929, it took the market ~5-years to bottom and another good while to turn around. There were no "circuit breakers" and no artificial pumping up the markets (like today). So I say, the market just started this "correction" and while the dollar is declining it will make lower lows (in an orderly fashion), but watch when the USD bottomed out!
  2. And the Panic of 1907...

    It is funny how global wars and economic crisis go hand in hand, don't you think?

    "Don't worry, be happy." Buy Xanax and drink it down with bourbon, supporting the common good and universally absolute truth.
  3. But it would serve one well to note that during the great depression, there were still bull markets. Commodities outperformed stocks during that time for example. One must also note that depressions present great buying opportunities for the astute, sagacious investor.
  4. Yeah the 1907 "correction"....well, I don't drink but lately I am questioning the wisdom of abstinence.......
  5. The best deal now is cheap land, farmland and some ways houses. When and if we have some inflation, your fix rate mortgage (IF YOU CAN GET ONE) will be a pissant chump-change.
    On the other hand your SS retirement won't buy you a six-pack, so joe six-pack may be joe-one-can ('cause all he can afford).

  6. Bulk acreage here in Florida is still commanding quite a premium, with large ranches still being offered at 40-80MM. However, I don't know what the bids, if any, are. The housing market is still out of line, despite the number of foreclosures. Europeans seem to be keeping this market on life support. One could make a case that the real estate in Florida has quite a way to go before the bottom.
  7. Before I start to analyze the markets in the Great Depression, I want to analyze the difference in the two economies.

    In my view, one has to get some kind of handle on how far down our economy will go.

    I guess one argument is that it was public employment projects that got us out of the Great Depression.

    I am not sure if I buy that.

    But in my lifetime, public employment has grown and grown.

    I am struggling with the fact that there are so many people dependent on government revenue for income. At this point, I am not sure if deepens our economic problems or mitigates them.

    But the economy and the market has some more down side. If for no other reason than psychology, those boys and girls in Gubmint and the MSM sold this legislation as a bailout and a RESCUE when time will prove it neither.

    Gubmint is more destructive of productive economy activity than it is a SAVIOR.

    The reason for that is that productive economy activity is based more on free market opportunities than it is Gubmint policies, programs, and provisions.
  8. The Dow bottomed on July 8, 1932 at 41.22 less than 3 years after the crash of October, 1929.
  9. hughb


    I wonder if a better comparison for this market would be 1907. JP Morgan orchestrated a bailout then, similar to Paulson today, except Mr. Morgan didn't pick the pockets of taxpayers to do it.

    If I have my facts straight, and I'm not too confident because I've read conflicting stories, Mr. Morgan returned to New York on Saturday, October 19 from a church convention in Richmond, VA. The next day bank presidents were coming to Mr. Morgan's home to find a solution. Mr. Morgan played bop-a-mole until early November taking on crisis after crisis until he even went to meet with President Roosevelt to convince him to give companies a pass on the Sherman Anti-Trust act so they could take over weak competitors. Taking a look at a long term Dow chart, the market bottomed in December of that year when a new bull market was ushered in.

    So, if you compare the two, you can see that Paulson/Benanke have been fighting crisis after crisis and are now orchestrating a huge bailout that required congressional approval. If my comparison is accurate, then we are near a stock market bottom even though an economic recession could last a little while.
  10. i have to agree with this, and the fact that the sp500 is nearing 2/3 re-tracement of 2002-2007, the tech bubble the sp500 also did a 2/3 re-tracement from 250-1400 back to 650. Also there is a GIGANTIC amount of money on the sidelines right now, Regular peeps are calling into cnbc's "on the money" with that carmen girl and telling her they liquidated their whole stock portfolios and bought tonnes of cd's (LOL), CRAMER IS SAYING TO SELL SELL SELL, vix is above 45 and has been for like the whole week almost, other stock markets such as the Shanghai Stock Exchange are down over 66% from their highs th SSE has done a 71.6% retracement from its 2004-2005 levels to highs of october to now.

    Globally everything is so down that.... you get my point, anyways i have started buying shit i like.
    #10     Oct 4, 2008