will the mkt ever turn on the low ball ests game?

Discussion in 'Trading' started by piggie2000, Oct 7, 2009.

  1. Everyone on earth knows ests have been purposely low balled. I mean com'on aa earns 4 cents and its been spun as a huge suprising beat?ests for the 3rd qtr earnings in the mkt have actually dropped the last 4 weeks from down 20% to down 24% EVEN AS MANY STOCKS UP 300%-1000% and many stocks near there 2006-2007 highs when earnings were 70% better. MY QUESTION IS SINCE WALL STREET HAS A VESTED INTEREST TO KEEP ESTS LOW SO ALL BEAT AND THERE STOCKS KEEP SKYING WILL THE MKT SMELL A RAT AND HAVE A VIOLENT REVERSAL AT SOME PT?after the biggest bear ever nobodys learned a thing and we're right back to the same games that caused the crash.
  2. the s&p has another 100 pts to the upside, just relax and go with it.
  3. piezoe


    Hey, Wall Street would not be Wall Street without lying, cheating, and stealing. That's where the appeal comes from. On Wall Street it's not only legitimate to behave like a criminal, it's expected!
  4. sub0


    I read that the cost cutting that led Alcoa up was primarily from cutting around 20,000 jobs. Basically the cost cutting they are doing is not sustainable. Also their revenue was down. I don't follow Alcoa though, so I'm sure there are other factors.

    I usually don't watch Mad Money with Jim Cramer but he brought up a really good point today. He said that you have possitive outlooks on Family Dollar and another report that people are now willing to pay premiums for brands. That you have low cost clothing companies with great outlooks and expensive clothing companies like Nordstrom with possitive outlooks being stated.

    He stated this is contradictory, if Family Dollar is up and doing well, it's because people aren't willing to pay premiums, they are trying to save money and are willing to trade down and not up.

    His rationale is that historically in the 30 years he's been an investor, it's one or the other does better not both.

    So I think we are in a point of irrational exuberance. There was a report that recently came out that stated the S&P is at an all time high in regards to P/E.

    What amazes me is how is it being propped up if so many people are out of jobs and broke! Where is all this capital coming from in the markets? Granted volume has been below the daily averages, I just don't see where the capital is coming from.

    Which is why I think we are having more choppy trading, seems trader related not investor related. The Alcoa numbers are bad, any investor could tell that. However for traders, it's some quick news they can pump and dump on.
  5. NoDoji


    Do we really care whether estimates are low balled to help the market rebound?

    Do we really care whether analysts upgrade one week and downgrade the next? My all-time favorites being: "raised from a sell to a buy" (so the company has turned itself around that quickly??) and "raised from conviction sell to sell" (so, if you didn't sell with conviction and you're still holding, now what?")

    We are traders! Just follow the money, whether it's reasonable or insane!
  6. sub0


    It almost feels like light retail trading is moving this market, we are on low volume, many stocks trading below their daily volume averages, volatility seems weak, more and more flat days. I don't know.

    Also you have to remember it's all about how the information is spinned. Just look at some of the news headlines that get added on a stock and those that don't. Look at how the titles are possitively phrased with negative information mixed inside. I think what you are pointing out is something that most people would never be able to put together because who's writing on it? I've yet to see anyone with an audience talk about how earnings are being purposely set really low so companies can beat them. So nobody knows. Most investors seem to be too dumb to even read the articles and news that is out there. In my opinion Alcoa had bad news. They didn't earn their earnings. They cut off their legs and said they lost some weight and saved some money on traveling expenses. Less employees equaled less revenue. Since your employees are a key factor in revenue. They are being mismanaged and aren't be strategic.

    We'll see, this is October. :cool:
  7. sub0


    I think you are right. If anything this points out that fundamentals are hard to trade on. No matter what they say, the market always wins. The flow of capital is so large through these equities that even the most highly capitalized trader would be crushed. You just have to go with the flow.
  8. jjj1000


    This is another bubble... Stock prices (of many stocks) are similar to what they were before the crisis started, when unemployment was 5% and people still were in a binging spending mode. P/E is at a modest 140 !!! http://www2.standardandpoors.com/po...ces_500/2,3,2,2,0,0,0,0,0,1,11,0,0,0,0,0.html

    Best thing IMHO would be to prop up the dollar and increase rates (the fed) very soon, right now... The more this bubble grows, the worse it will be when it bursts...
  9. We can say all we want but we are influenced by how high and far something has run. by that i mean if you buy 2000 gs at $191 knowing it ran from $47 you're more likely to get shaken out on a 50 cent drop than if were $60 down from $200. In the back of your mind you know its skied 400% which makes your quicker on the trigger to exit.
  10. sub0


    Well I feel like everyone is waiting on something to trigger a correction. It doesn't seem like it's just going to correct just because it's overbought. Something is going to have to trigger it, and I think it's got to be something that average people can wrap their heads around. Anything that requires some sort of in depth analysis on why will only give certain people an edge.

    But the reality of it comes down to the simplicity. Unemployment rising, raising interest rates aggressively to protect the slide of the dollar, a sector crashing because of some sector specific data that is released. We'll see. :cool:
    #10     Oct 7, 2009