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Richard Russell: The Verdict Is In – It’s a Bear
Source: Richard Russell, Dow Theory Letters
The verdict, at long last, is in. Today the D-J Industrial Average closed below its November 20 bear market low. In so doing, the Dow confirmed the prior breakdown of the Transportation Average. The two Averages jointly closed at new lows today, thereby signaling that the great bear market remains in force.
According to Dow Theory, neither the duration nor the extent of a bear market can be predicted in advance. However there are some useful hints. Most major bear markets end with stocks at "great values" or as some Dow Theorists put it, "below known values."…
23Feb2009 | The Gold Report | 0 comments | ContinuedWhy Buffett, Grantham, and China Are All Buying
Looking back, the signs of a market tops and bottoms are so obvious. Hindsight is 20/20 and all that. When you’re in the middle of it all though, it’s not nearly as easy to see.
During the peak over the past couple of years a lot of records were made.
For instance, CEOs booking eight and nine figure paydays. The average bonus at Goldman Sachs passing $600,000. Thousands of part-time real estate flippers getting rich a bit too easily.
There were lots of them.
But a lot of that money was spent – err – squandered. It wasn’t saved. The smart money was saving.…
19Feb2009 | Q1 Publishing | 0 comments | ContinuedAre We Nearing a Housing Market Bottom?
It’s been a long, downslide for homeowners or anyone trying to buy a house.
But a Moody’s Economy.com report, “Housing in Crisis: When Will Metro Markets Recover?â€, says we could be nearing the end.
Specifically, the study estimates that:Â
- House prices will stabilize by the end of this year.
- The national Case-Shiller house price index will decline by another 11% from the fourth quarter of last year for a total peak-to-trough decline of 36%.
- Before the downturn ends, house prices will have declined by double-digits in nearly 62% of the nation’s 381 metro areas. House price declines will exceed 30% in about 10% of U.S.…
History Shows It’s Time To Buy
The market can be frustrating. Just a few weeks ago it looked like the markets were about to reach lows we haven’t seen since the early 90’s.
The commodity bubble was bursting, hedge funds were imploding, and it seemed like the selling would never stop. To add fuel to the fire, unemployment was getting worse, consumers started saving again (seemingly all at the same time, which isn’t very helpful), and practically every week another bank failed.
It was disastrous. The government was handing out cash to banks and guaranteeing private companies’ commercial paper while putting trillions of dollars it doesn’t have at…
9Dec2008 | Q1 Publishing | 0 comments | ContinuedSystemic Inflation Running Rampart
Today (Monday) marked what will become a very typical day in financial markets. The U.S. dollar, Oil, Gold, and stock markets were all up. Denmark joined the bailout game with their $13.4 billion capital infusion in the banking and insurance company Ing. Meanwhile, more U.S. regulators are getting the public juiced up for the next stimulus package.
After the greatest period of nominal deflation in our nation’s history, asset prices are at or nearing bottoms. The halting of this deflationary period is 100% government intervention. Let’s not forget that if the deflation was allowed to run it’s course, it would have…
21Oct2008 | Oxbury Research | Comments Off | ContinuedHere’s Why the Stock Market Relief of Late Last Week May Not Last
While investors remain extremely concerned about the volatility of the U.S. stock market, the weakness of the American economy and the uncertainty of the global financial markets, last week brought “slight” relief from the excessive panic of the eight-trading-session losing streak. Bear in mind that each new economic report, earnings statement, news report or trading session represents a new opportunity for fear and uncertainty to reemerge.
Fortunately, next week’s economic calendar remains quite light, although retailers may just weigh in with “doom-and-gloom” holiday predictions. Earnings season may be weak as well (with even more pessimistic outlooks), so investors should not overreact…
20Oct2008 | Money Morning | Comments Off | ContinuedCredit Crisis Update: Dow’s Wild Ride Convinces Some We’ve Seen the Bottom
Panicked international investors fled the markets as a steep sell-off circled the globe today (Friday), but a late-afternoon rally helped the U.S. market pare the bulk of declines.
“A lot of institutions are deciding to come back into the market,” Michael Nasto, the senior trader at U.S. Global Investors Inc., told Bloomberg News. “We’ve been beaten down so much. Some people feel this is the bottom.”
After plunging below 8,000 earlier in the day, the Dow Jones Industrial Average reversed course. At the New York close, the blue-chip Dow posted a reduced loss of 128.00 points (-1.49%), to close at 8,451.19. The tech-laden…
13Oct2008 | Money Morning | Comments Off | ContinuedThe Little Market That Couldn’t
And people who think they’re laying rail.
Sigh. I tried. Really, I did.
But there was just too much idiocracy to allow the publishing of the first two articles I wrote this week. Originally, they were optimistic, forgiving, and light-hearted. Then I turned on the television.
And started laughing. A frustration-driven, maniacal laughter that rivals that of the Joker from Batman. And not Heath Ledger’s Joker, I’m talking the original – Jack Nicholson style.
Why?
Because I love watching fat cats sweating through their $3,000 suits, all but hyperventilating under the bright lights and cameras surrounding them, as even they struggle to believe the…
19Sep2008 | Oxbury Research | Comments Off | ContinuedIn Search of a Market Bottom: Position Yourself for Profits No Matter Which Way the Market Moves
In a Money Morning commentary back in April, I suggested that while we’d hit a new market bottom, we almost certainly hadn’t hit the market bottom.
So have we now?
That’s tough to say, although three seemingly unrelated bits of data suggest the ultimate market bottom may be lower still, meaning investors aren’t out of the woods, yet. Let’s take a look:
–Since 1990, there have been 13 declines of 10% or more in the Standard & Poor’s 500 Index. And while each drop of this magnitude tends to precede a rally of six months or more, an ultimate market bottom typically hasn’t been…
15Jul2008 | Money Morning | Comments Off | Continued
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