Financial topics

[aedens]

http://www.testosteronepit.com/home/201 ... ts-up.html

Social lenses. I had a link to cultural edifaces as in productivity of regions in historical context.
I will dig up the link later in the forums. It explains the perceptions and claified many views for me
on the social planes. Not to be percieved as bias, but regional realities I would forward.

[OLD1953]

A lot of what is taken as output from one stream is input to the next stream. Thus, we can consume more than the planet produces, in a sense, just as we can consume more silver each year than is mined, and have for as long as I've been alive.

A few years back, in another forum, there was a huge arguement over recycling going on, whereby some were calling for recycling to be a major industry. When I pointed out that it was already one of the largest industries in the world, I was met with total shock. I quietly showed them that used auto parts and auto junkyards were (at that time) the 18th largest industry in the US, and carefully pointed out that a modern junkyard gets EVERYTHING, from the PGM in the catalytic converter to the rubber in the tires to the lead in the batteries. People don't see what they are used to seeing, somehow those "eyesores" never were looked at as important recycling centers. Life is odd, but I like it.

[aedens]

http://www.amazon.com/Our-Dying-Planet- ... 6TWVU5XWC2#_

More in this scope I was very poorly trying to forward. Yes we recycle alot of material but this guy lays it out
in a broader reality. Some things are going away and the equation will break down. When? no
clue but again he has some stark facts.

In its simplest form: Price effect = income effect + substitution effect
Slutsky asserted in 1915 that demand theory is based on the concept of ordinal utility.
his idea was developed by Hicks who separated the consumer's reaction to a price change into income and substitution effects.

[jdcpapa]

Earnings affect stock prices. Inflation or deflation affect the cost of goods and services. Hence, it could be argued that inflation or deflation is "about changes in PE ratios".

The PE ratio is the value that investors place upon stocks; the price of the stocks is more influenced by the ratio than by th earings.

In a stock market boom the ratio can be 20 but at the bottom of the bear only 5 or 6. If you examine the history of S&P 500 PE ratios you will see what I mean. OK I have a stock with a PE ratio of 20 a price of 100 and earnings of 5. If the earnings fall by 20% and the ratio stays at 20 then the price drops by 20%. But if the ratio drops to 5 and the earnings remain unchanged the price becomes 25 or a drop of 75%.

If you do the math every which way you will see that the ratio is the more important component; it is the valuation that investors place upon the stocks.

Changes in valuations by themselves are neither inflationery nor deflaionery - there needs to be a monetary transaction involving goods or services for an effect to be created.


Regards, Richard

Good morning,

The P/E ratio is a valuation mutliple. It "expresses the relationship between the market price of the company's stock and its net income". It also "measures the operating results of a given company for a chosen period". The valuation that investors place on stocks is the price. In the real world, earnings drive value (price). Changes in valuations are the direct result of monetary transactions involving the sale of goods and services that produce earnings; inflation (or deflation) is "cooked" into the earnings.

Have a great day,

[RDRUNR]

Times are getting more and more interesting here in Europe. In fact, John has it right with the amount of real problems he is reporting, the only thing John is missing is the fear on the streets here. People are truly worried about the EU falling apart and the coming riots. Already shops on High Streets which were doing very bad and are closing down in larger numbers now, jobs are even harder to find now and there are growing concerns about other Europeans coming into the UK to take jobs.

My landlord said yesterday that in Ireland, mortgage rates are at 7-8%. Since the RE collapse there in Ireland, values are down 50%.

[richard5za]

Interesting chart by John Williams of the Shadow Government Statistics website

HousingStarts.jpg (54.2 KiB) Viewed 6892 times

[Higgenbotham]

Just went short the 15% position again this morning from about S&P 1195. This is the first place I think the S&P could top out but my guess is it's still going to go quite a bit higher.

Above was posted Thursday morning September 15. Covered for 30 points. I do see the possibility of a steep plunge toward about October 5. I'm going to play for a high into September 26 or October 5. If there's a plunge into October 5, I will try to catch a little rebound with a small position.

[OLD1953]

Aedens: I'm aware of the issues surrounding reef corals, but the complexity of that issue prevents me from completely understanding what is going on with them. Reef corals, particularily on the Great Barrier Reef, are wound into such a complex system of cleaner fish and picker fish and worms and algae and so forth that anything that affects any part of that system will eventually impact the corals. I am not certain that any rate of natural dying of reefs in that area has ever been established. For that matter, there has been a starfish population explosion and that's damaged the reefs, but did man cause a starfish population explosion? And how? It's claimed that shell collectors caused the population explosion, but molluscs lay enormous numbers of eggs, where are the little tritons? And why isn't disease limiting the starfish, surely they have diseases?

And not all reef corals are fragile specimens, either. In a number of places, including Hawaii, corals can and will colonize human beings. A coral spore infection can be a serious matter, and that's why people hate coral cuts, because the treatment is much worse than the cut itself, essentially a scrubbing with strong disinfectant and a wire brush, according to people I know who've gone through it. As for an established infection, that can require surgery.

Other corals can be very hardy, one of the people that had been treated for coral exposure told me his friend had a growing brain coral in a washtub. It rained most days, so it stayed damp, and the coral just kept getting bigger. He never did seem to water it or anything, just left it alone and it grew.

[richard5za]

I'm going to play for a high into September 26 or October 5. If there's a plunge into October 5, I will try to catch a little rebound with a small position.

Higgie, from a chartist's view point I don't think that S&P is going above 1215 again for a very long time, probably years, maybe a decade. Its about here that I have been seeing a resistance point which wasn't breached despite a few attempts. It closed at 1167 last night and I personally suspect that a significant fall is on the cards. This is just from a charting perspective. Charting gives one buy and sell signals and there has been a strong sell signal for some time. It doesn't give you timing so I can't comment on your 5 October date. If you asked me "Where will S&P be at the end of the year?" my answer would be "I have no idea, but its trend is now down"

But good luck. Hope you make a big, big bundle!
Richard

[Higgenbotham]

I'm going to play for a high into September 26 or October 5. If there's a plunge into October 5, I will try to catch a little rebound with a small position.

Higgie, from a chartist's view point I don't think that S&P is going above 1215 again for a very long time, probably years, maybe a decade. Its about here that I have been seeing a resistance point which wasn't breached despite a few attempts. It closed at 1167 last night and I personally suspect that a significant fall is on the cards. This is just from a charting perspective. Charting gives one buy and sell signals and there has been a strong sell signal for some time. It doesn't give you timing so I can't comment on your 5 October date. If you asked me "Where will S&P be at the end of the year?" my answer would be "I have no idea, but its trend is now down"

But good luck. Hope you make a big, big bundle!
Richard

My plan is to wire out of my account if the markets exhibit a steep fall from right here. If that happens, Maximum Ruin will likely begin to relentlessly operate, brokerage accounts may get frozen and the account holders may eventually only receive pennies on the dollar, if anything, even if they are right on their trades. But if the market can rally toward about October 5, then I think the financial system will hold together for the most part, at least through the end of the year. I'm 100% in US dollars (mostly short term treasury bills) so as the dollar rallies, that's OK too. These are Quantum effects I'm talking about moreso than Newtonian (standard charting). The precious metals will continue to fall at a greater rate than the S&P, as they are doing today (silver down 8.3% and gold down 4.3% today).

Also, I don't think the highs of this bubble will be exceeded for decades or maybe even centuries. I believe this is much larger than previous modern era cycles and the crash will be bigger and more devastating than nearly anyone can imagine. As I've watched this topping action unfold, it's been OK to skim some money off but the operative strategy for me is to keep foremost in my mind is that in a Depression everyone loses and he who loses the least is the winner. There is a hard rain coming, and I believe it could be the hardest in 7 centuries or maybe even since the fall of Rome.