When is recession and correction coming?

ByLoSellHi · Feb 27, 2007

Quote from Covertibility:

If anyone knew if the market was gonna fall, you'd probably know where the bottom was too, who shot Kennedy, why was Generallissimo Bush so concerned about that Pet Goat, etc... I don't play the "what if you knew" game.

In terms of selling, one would have to take into consideration the tax ramifications, opportunity cost, etc..

A simple question but very many things to consider.
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Poor choice of wording on my part.

If you 'believed' the market was set to significantly correct.

drsteph · Feb 27, 2007

Quote from drsteph:

They say that recessions start about 6-12 months after a significant plunge in the market, so average 9 months.

Inverted yield curve, declining manufacturing numbers, and negative savings rates all bode extremely poorly for the economy.

Can't raise rates - ARM resets will worsen and foreclosures will rise and the subprime market will disintegrate causing a banking crisis.

Can't lower rates - there will be a rout out of the USD and inflation will heat up, causing wage increases leading to a wage-price spiral.

Staying the course seems the most intelligent thing to do, which is what we have seen. But it doesn't last forever.

The US consumer is tapped out at the low end - vis a viz walmart's lousy holiday season. The mid range customer will feel the heat of any interest rate increases, and only the upper customer will feel relatively unscathed - until a equity correction causes them to feel 'poor' and pull back.

You will know that things are getting bad when the rate cuts start happening. By then though, it will likely be too late as the equity market correction will have happened.

I suspect september is when things start to get ugly. But I have been surprised by the length and strength of this expansion, which may yet be pushed out with credit expansion maneuvers. Until there are clear signs of credit contraction and risk premium gets built back into the market, it seems like status quo to me. Even though I KNOW in my mind its all based on fluff.

Just my opinion. DYODD.
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Rather prescient, if I don't say so myself. Clock is now ticking.

Even Greenie agrees with me!

SuperVolatility · Dec 2, 2013

Quote from jimclark:

Since December I've been slow on buying certain stocks/mutuals/efts for my retiredment acocut in anticipation of "recession" and "pull back" or "correction"

Holy shit...it's almost March but no correction or recission but a raging bull, not that I have anything ageints it but...<angry face> I missed out on some of hte moves since December 06 on some stocks while waiting for "correction".

I welcome any feedback...what is your gut feeling. Of course...good old saying goes never try to time the market but...maybe sky is not falling after all.

Market keeps going up and not taking a break....what's up with dat?
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Interesting...reading this almost 5 years later.

Expectation for correction was posted in Feb 2007 and the market started showing signs of weakness in November 2007 with 2008 being a down year...until hitting the rock bottom in March 2009 and reversing.

All in all - the post missed the correction estimate by 10 months or so ???

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When is recession and correction coming?

ByLoSellHi

drsteph

SuperVolatility