2008 Financials Thread

[Flasch186]

End of day

Well Im here a few minutes before we go. A down day on wall street as most people think that it was time to take some profits from the rare week up of '08. Next week we have the Official FED meeting and speculation runs wild about what they'll do. Cut? how much? etc. Bush's State of the Union address is Monday but most people dont put much effective weight in that. Some Job losses that have been announced seem to keep fanning the nervous flame for next week.

I suffer some losses today but not every one is going to be up. I am thinking that we are building a bottom here and will try to average in some on Monday morning. This play is very speculative as the FED meeting could send the Dow soaring or tumbling and Ill find myself on one side of the fence. Some people who play options can hedge their bets that way. I dont know anything about these so I'll leave those for someone else to talk about.

[Flasch186]

January 28

We should see tons of volatility this week and it doesnt get us off on the right foot that the asian and european markets tumbled overnight. We'll see a ton of data this week that will swing markets. It wont be for those with weak stomachs. President's State of the Union address which should focus on the economy but will have very little in substance as it is a more glossed approach, Fed Meeting is big, but some say the biggest number and the true sign if were in, headed for, or going to skirt a recession: The Jobs report on Friday couple with the manufacturing report. Low numbers of Jobs or a negative manufacturing report and you may see people head for the doors Friday afternoon. Something more on the positive side of things and perhaps some people will view this as an entry point.

This morning Mcdonald's (MCD) beat their numbers but stated that same store sales in Q4 were flat but Sysco (SYY) had a slight miss. The market had futures way down early and has slowly fought its way back to -29 but continues to be up and down but below fair value.

[Flasch186]

3:20pm

the day stays up ALL day since the initial downer of an open as the markets start to hang their hats on a .50 rate cut. This is on the heels of the worst housing numbers in recent memory as sales tumble to a low not seen yet in this cycle. Some fish out positive news in that prices have begun their decline meaning that sellers are finally getting "real".

On the economic stimulus front it seems that the speed the package has seen thus far may be running aground as the Senate talks of adding angles to help Seniors and unemployment benefit extensions. The Pres. will warn on this in tonight's speech supposedly.

My stocks do fairly well today and I have 50% of my powder on the sideline protecting myself from the bear turn, should it occur again. If we begin a steady climb Ill try to find entry points along the way. No need to pick the bottom, I try to keep telling myself.

Originally Posted by yahoo

3:00 pm : Stocks retreat off their highs, but are still holding onto strong gains. The recent retreat was concentrated in the tech sector, which is now trading 0.1% lower.

Shares of Nymex Holdings (NMX 114.50, +7.34) are posting significant gains. CME Group (CME 619.81, -9.19) and Nymex confirmed rumors that they are in preliminary discussions regarding CME's potential acquisition of Nymex. The companies have agreed to a 30-day exclusive negotiating period.

In other acquisition news, shares of Alliance Data (ADS 42.10, -23.50) are sharply lower after the company indicated its acquisition by affiliates of The Blackstone Group may not happen. Blackstone had told Alliance that it does not anticipate the condition to close the merger related to obtaining approvals from the Office of the Comptroller of the Currency will be satisfied.DJ30 +82.75 NASDAQ +10.32 SP500 +12.57 NASDAQ Dec/Adv/Vol 1017/1927/1.44 bln NYSE Dec/Adv/Vol 766/2390/1.02 bln

BTW Google (GOOG) and Apple (AAPL) look really tempting at these prices especially for those of us who missed the run up last time. We want in and we want the run up to happen again. Google tested some lows today and Apple has been sliding.

[Flasch186]

end of day

The markets finish off on a high and look to be rallying into the FED meeting. Again, tech sector was the drag so it may be an opportunity for some to get in there should they have missed a time or two before. Financials lead the charge and hopefully will continue this push should the Fed meet the street's expectation on the size of the cut.

My XLF play I hope to be able to play on this.

Sirius (SIRI) is rallying from lows a few weeks ago in the 2.60+ range. Figures that I missed it.

[Flasch186]

January 29

The street looks at a higher opening as the FED begins their meeting today. The Street seems to be betting on a .50 cut but I can tell you if they dont get it we're looking at quite the tumble. We're going to get a look at the river card tomorrow so if you're nervous you may want to sell at some point today to dodge the decision. I will not be. As signaled by my Financial ETF play (XLF) I think we get the cut and financials and homebuilders head higher. Im not sure what is going on with Tech as it seems no one wants to dive back in there yet. You could see global Ag. companies turn north as well following the cut as they have just gotten destroyed lately ie. Monsanto (MON), Potash (POT), or the ETF (MOO).

[Flasch186]

Im taking a chance and getting into Google as it tests it's low. If the FED cuts .50 tomorrow I hope this support level serves as a launching point for this tech stock. If not it could turn even further south, which would suck.

[Flasch186]

midday

All day speculation on trying to forecast the FED's move and the market reaction to what it could be. Some feel that no matter what tomorrow will be a down day. I'm feeling contrarian and think that the FED will cut .50 and the market will turn to the comments. I am hopeful that this will send the markets higher as they begin to digest the FED speak. Could be wrong and if I am then my entry point on Google (GOOG) will have been off.

[Flasch186]

end of day

we head into the end of the day on an upswing as quiet optimism starts to come through that the FED may ease that .50 everyone wants and reinforce their fears of the slowing economy as opposed to inflation fears. Yahoo (YHOO) reports after the bell and many expect major reshuffling and reorganization from them. some rumors overnight that Microsoft (MSFT) might try and enter the search space and that may involve Yahoo, somehow. All eyes on the FED. My Google (GOOG) entry is slightly down at the end of the day but that's to be expected for one day. If we hit off tomorrow it could turn up or down depending on market leadership. If we peg downward after the FED at 215pm EST we could be down a lot only to hopefully come back up some.

[Flasch186]

afterhours

Yahoo (YHOO) meets expectations but forecasts a lower than expected outlook. Yahoo begins to sell off afterhours taking Google (GOOG) with it. My entry was early and Ill buy some more tomorrow to average that entry.

[st.cronin]

Did Flasch quit his job?

[Flasch186]

naw, but if you havnt heard Real Estate is slow so I have time to watch the markets and dredge through information until my brain explodes.

But Im trying to launch a small business too....keeping busy when it's so frickin' slow.

[Marc Vaughan]

Originally Posted by Flasch186

some rumors overnight that Microsoft (MSFT) might try and enter the search space and that may involve Yahoo, somehow.

I think its unlikely that Microsoft would purchase Yahoo - if you look at the webstats Microsoft are already in third place (13.8%) just behind Yahoo! (17.7%) and the very dominant Google (56.3%) are far above both.

Purchasing Yahoo! would put Microsoft in second place but still far behind Google, I could only see them doing the deal if it'd give them a real shot at the title myself ... otherwise they'll just try and continue to make inroads using their dominant aspects (ie. integration via. MSN Messenger etc.) as they've been doing in the past.

[Flasch186]

Jan. 30

ADP Report (private payroll #'s) - HOT HOT HOT, this may make it tough for the FED to go .50 on their cut. However does it say our fears of recession may be unjustified? Report couldnt come out at a better time for FED watchers. If the FED still goes .50 the markets may fire off from here. a .25 cut and all bets are off.

GDP comes out "light".....this may be creating the perfect storm needed for the .50 cut. wow. GDP still grows at .6% so now the street is looking for that cut of .50% or it is going to drop precipitously IMO.

[Flasch186]

DOLA

Lots of negative sentiment regarding the decision today wherein we may see a selloff no matter the decision. Some even think that this could be the beginning of bearish sentiment to re-test the lows. I hope not, what to do?

[Flasch186]

Here we go!!


Fed's decision:

.50 & .50 and the markets jump immediately BUT we'll see if this is a prelude to a selloff. The commentary was huge though, expect moderation of inflationary pressures while downside risks remain and the FED will act in a timely manner.

[Flasch186]

the rally seems to be gaining traction as the markets digest this. Things seem to be looking up but there is a dark horseman on the horizon in the way of Friday's jobs report.

[Flasch186]

end of day

A NASTY end of day sell off leaves the markets in negative territory. Exemplifies the volatility we're suffering right now. Amazon reports after hours a beat on profits, a raised outlook all which bodes well....but the bears sift through their comments and sees that margins we're squeezed and the sell-off occurs after hours.

My positions hold basically except for my financial ETF which sells off with the financials at the end of the day.

Google (GOOG) reports earnings tomorrow for more volatility and I might lose my ass on it.

tomorrow's sentiment is shaping up to be brutal. The Mortgage Bond insurer rumblings regarding writeoffs, downgraded (loss of AAA rating) and potential rumors of an "apocalypse" in their sector is tying the leash onto this dog and preparing to lead it right into the ditch. Im prepared to ride this one down i think hoping for a bounce. I swear, everytime i think we're done with this and that we'll avoid a broad recession (or may be past it), I get a swift smack in the face.

[path12]

For the record, I enjoy following this thread even though I don't have enough knowledge to really comment on it. Other than my 401K I'm woefully underinvested.

[Flasch186]

Originally Posted by path12

For the record, I enjoy following this thread even though I don't have enough knowledge to really comment on it. Other than my 401K I'm woefully underinvested.

thanks, start by watching CNBC and starting up a play money account somewhere. Thats a zero risk way to get started.

Im hoping it'll catch on with other people who will start posting thoughts, positions, etc. I would love to have it turn into a long term gathering place for commentary and debate on the markets.

All are invited to participate

[st.cronin]

I just want to reiterate that I'm quite bearish for the rest of the year. There will be companies that make money - but I don't see much reason for general optimism until a new President is inaugurated.

[Flasch186]

Would you say that this is based on the general slowing of the economy or other factors? Is the severity of the bearishness effected by recent rate cuts? Are you saying that the political season has something to do with the bearishness as you certainly are not the only one to be so?

[st.cronin]

Originally Posted by Flasch186

Would you say that this is based on the general slowing of the economy or other factors? Is the severity of the bearishness effected by recent rate cuts? Are you saying that the political season has something to do with the bearishness as you certainly are not the only one to be so?

The market has been over-priced since the Clinton boom. There was a "pop" in 2000, but the correction was just a partial one - there's been a full correction waiting in the wings ever since (my opinion, but I know I'm not alone in thinking that). The recent rate cuts have been, I think, made partly with the idea of propping up the market. But rates have been historically low in recent years, too, and unless it goes to .025 or something, I just don't see low rates carrying the same weight they historically have, I think they've done all they can do - combine that with the slowing of the housing market, and the problems in the credit industry, and I REALLY don't think rate cuts will help the market much. And in general I think until the election there will be some uncertainty as to the direction of the economy, and thus a reluctance on the part of investors to fully participate.

Note that I do think the economy is still strong, and worth investing in. I just think looking for short term profits is going to be extremely difficult, whereas in the 90s it was disarmingly easy.

[Marc Vaughan]

Well this might put the cat amongst the pigeons ...

http://www.bloomberg.com/apps/news?p...d=am2Nk1VM5YsA

[Flasch186]

yeah, Im not sure how this will play out because at the same time there have been talks of bailouts and such for the Bond Insurers so it may factually end upw ashing eachother out. This will be THE news for tomorrow though so the markets will be interesting to watch.

IMO this could be the single largest thing to happen in this whole subprime mess, thus far. Could literally push us into a 2000+ point sell off (over a few weeks). I hope Im wrong but I must admit that i will have a hair trigger on my stocks going forward.

[MikeVic]

Please keep this up. I like reading it and trying to understand what's going on so I can one day venture into stocks.

What site do you use to check stock prices and history and stuff?

[Flasch186]

i use Bank of America for my trading and streamer, yahoo financials for charts and such but Im sure others use much better and more intricate stuff.

[Flasch186]

overnight

Posting an overnight update due to the S&P Mortgage Bond insurer downgrade rumors (see article linked a few posts above)

Asia's Nikkei is up which means perhaps there is a little less fire to that talk then need be. This is grasping for straws though as the overseas markets tend to be, well, stupid and follow our lead. Every time I've tried to see an overseas market take the lead on an issue they end up looking retarded.

[Marc Vaughan]

Originally Posted by Flasch186

IMO this could be the single largest thing to happen in this whole subprime mess, thus far. Could literally push us into a 2000+ point sell off (over a few weeks). I hope Im wrong but I must admit that i will have a hair trigger on my stocks going forward.

My gut feeling is pretty negative towards the American market at the moment, even companies which are returning good financials are struggling to swim upstream .... until things settle down a little and some consistent good news starts coming through I think things will continue to head south at the slightest flicker of negativity.

(I would however still consider investing outside of America - partially because the external economies appear to be holding up somewhat better, but also because I expect the dollar to drop further before it recovers)

[Flasch186]

I'm tempted to sell out of my Google (GOOG), and Financial Sector Spyder (XLF). Im feeling bad things going forward.

January 31

This morning the economic reports did not bode well:

Originally Posted by news

In addition, new reports on consumer activity and the labor market were worrisome reminders of the seriousness of the economic slowdown.

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A sizable 0.50 percentage point rate reduction from the Federal Reserve on Wednesday was not enough to keep stocks higher. An initial relief rally after the Fed announcement gave way to a new selling wave as speculation mounted that insurers that guarantee massive amounts of municipal and corporate debt may receive downgrades from credit agencies as early as this week.

So we're seeing some stuff that coupled with the MBI stuff could lead us to the cliff again. However, rumours are swirling that the bond Insurer(s) may get swooped up by vultures. If this happens it could stave off the negative drag from it (might even create a small bounce). We shall see but it's hard to shake the negative sentiment.

[JPhillips]

MBIA has to have their rating lowered. They just announced losses of 18.61 per share. No way in hell they keep a AAA rating.

[Flasch186]

after a really scary open we seem to be treading water and even paring off some of those lows. Could be a slight bounce leading to a sell OR the waters could be so muddied right now that we begin to go flat heading into tomorrow's jobs report.

In the meantime, the bonds market have begun to bet on an intermeeting cut by the FED again. Some would say it's just greedy while others say it plays into the "things are worse then they seem" thought.

An upgrade today for the entire U.S. Retail sector from a Dutch bank and Wal-Mart (WMT) is jumping for me. this is helpful in countering my losses on Google (GOOG) which could get worse as Google reports after hours.

[MikeVic]

What does it mean when a company splits its stock?

[Logan]

Originally Posted by MikeVic

What does it mean when a company splits its stock?

Pretty much exactly as it sounds. If a company announces a 2 for 1 split, and you hold 100 shares at $50/share, you now own 200 shares at $25/share. Market capitilization (market value of shares x number of shares outstanding) doesn't change, and there's no dilution because everyone still owns the same percentage of shares.

[MikeVic]

Why would a company split? To make it seem like they aren't doing as well?

[Logan]

Public perception, mostly. Although I think there are many different schools of thought to be honest. A stock trading at $100 seems to have a higher barrier to entry to the simple investor than when it's at $50. I think there's also a belief that it's "easier" for a stock to grow when it's at a lower price.

edit: http://www.investopedia.com/ask/answers/113.asp

Kind of what I was going for:

A stock split is usually done by companies that have seen their share price increase to levels that are either too high or are beyond the price levels of similar companies in their sector. The primary motive is to make shares seem more affordable to small investors even though the underlying value of the company has not changed.

[MikeVic]

Cool, thanks a lot! I wasn't sure if it was a bad or good thing.

[st.cronin]

Stocks normally only split after hitting a new high.

[MikeVic]

fyi, I'm browsing Google Finance to check for how the market is doing, and to check on the one mutual fund I do own.

[Flasch186]

Mid-day

What is going on today?!

We started down 180 and the market was rattled completely by the bond insurer talk but not only have we fought back but we are now up over 100 points!

I sit pretty with an upgrade of the retail sector and my Wal-Mart is up almost 3% putting me in the green on it over 2.5%. Google still looms tonight and is quite the scare.

For us gamers Gamestop (GME) spiked today on the retail bump up over 2$. I am a firm believer that this will be a big winner this year even with a slowdown. I liked this stock below 50 and am not really sure why I bought Wal-mart (WMT) over it other than the residual recession talk.

The XLF is up over 3% today too. nice.

Recovery talk!! Home Depot (HD) up a bunch and Wal-Mart helping.

[Flasch186]

I cut short my stay in Google (GOOG) I end up at about a wash there, a little down but I need to dodge this bullet. This afternoon could be ugly, like the other internet companies.

Im just a puss and I just dont see any good news getting a positive result afterhours. I could be wrong but the trends speak otherwise (AMZN, YHOO)

2:00pm Of course, GOOG goes up on the "Flasch sales" rally. I miss a huge pop during the day, perhaps on the Band C wireless auction reserve price being met meaning that whomever ends up with the wireless network has to run open source, thus helping Google to spread its wares, on it, even if they dont own the network.

Man is that frustrating! My friend thinks that this is a prelude to a sell off on the heels of their earnings tonight and the jobs report tomorrow. He is actually short the markets for tomorrow.

I shouldnt be upset. Im up acrossed the board on my other holdings: Cisco (CSCO), Wal-Mart (WMT), Fin. spider (XLF) but I hate it when I zig when I should zag.

[Flasch186]

End of day-ish

Today's rally is actually picking up steam heading into the Google (GOOG) earnings at 400pm est. The pattern has been that these rallies either fall off end of day or get killed afterhours, especially as tech stock report earnings.

Today's rally has been led broadly by some financials, home builders, and consumer retailers smacking the face of the recession talk HOWEVER we stare straight into the eyes of tomorrow's jobs report. Im not sure how that has gotten moved from the front burner to the backburner today because this morning markets we're trembling before it and hanging onto every word about the Mortgage Bond Insurer issues.

Speaking of, MBIA had a conference call and basically spat in the face of the "fearmongering" going on and stated that they were very healthy and were not concerned about being close to losing their triple A rating.

Jeez, Google (GOOG) has popped a second time, along with the markets into this end of day and now is up over 17 points (oh, opportunity). I still wonder how the earnings report will effect everything. I hear that the rally is short covering but at this point, who knows.

[Logan]

Another decent day for ABK. At this point, I'm only down about 60% on it from my buy three weeks ago.

[Flasch186]

any opinions on today's rally? Is this a good time to take some profits? Will it be the start of something decent through February?

[st.cronin]

KGC
AA

[Flasch186]

----woah last 10 minute bounce here?


shaky stuff to end the day.

Apparently a Reuters headline came in to smack the MBIA downgrade nail in again. lost 100points on it, perhaps.

We await Google (GOOG)

WOAH, huge MISS!!! I might've actually did this right!! unreal. It is way down (~$50/share) afterhours almost immediately. News still coming out.

My reaction may be the markets but some snippets out of the report might show some really good signs to grab ahold of. The Conference Call has yet to come but this may be a case of the market's seizing on anything negative to sell while possibly creating a situation where the stock is oversold (compare to Amazon[AMZN])

[st.cronin]

Maybe also SLB.

[st.cronin]

SNPS is a good company that lost some money today, I don't know why. Might be a bargain.

[st.cronin]

Flasch: Hold on XLF. Sell everything else. Get into precious metals, energy, and maybe some more finance - although you don't want to be too exposed to that sector. Your window for precious metals is Election Day. Get out between a month and a week before that date.

This advice is completely free, and worth every penny.

[Flasch186]

Cronin, Could you do me (and the watchers) a favor and expand more on your tickers above? Company names, your feelings on them, etc.

when you have time, of course. Thanks.

BTW, my analysis and opinions are complete laymens's observations and you should do your own Due Diligence before buying or selling any stock or investment. This should apply to probably any post in this thread.

Now if you have a question about Housing....PM me, Im an expert on Jacksonville, FL

[Fighter of Foo]

"The reaction of the stock market to the unexpected 75bps cut by the Fed last week and its reaction today to the further 50bps cut clearly shows that markets and investors are now fully realizing that the US economy is suffering from serious credit, i.e. insolvency, problems, not just illiquidity ones; and that Fed monetary policy can partly tackle illiquidity problems but cannot resolve insolvency ones.

Last Tuesday when the Fed unexpectedly cut the Fed Funds rate by 75bps the US stock market fell by over 1% in spite of that cut (but by less than the 5% that the futures had priced before that surprise cut). The next day – Wednesday – the S&P tumbled by another 2.5% for most of the day giving the market verdict on the Fed action: too little, too late and useless to resolve the massive credit problems in the economy, including the serious market concerns that a downgrade of the monolines would lead to massive financial write-downs and a financial meltdown. The late day whopping rally in the last two hours of trading on Wednesday last week – 600 points on the Dow and over 5% on the S&P – was triggered instead by the news that the New York insurance regulator had met with banks to try to work out a plan to recap the monolines and thus avoid a catastrophic downgrade of their triple AAA rating. So that day the market told the Fed (with a 3.5% stock market drop following the rate cut): your 75bps cut means practically nothing to us and unless the credit problems of the economy are resolved. And the 5% rally was indeed triggered by news that maybe the monocline downgrade could be avoided.

Same story – in reverse - today Wednesday after the additional 50bps cut by the Fed. The initial reaction of the stock market was a relief rally – with the S&P500 index up about 1.7% after the Fed announcement and its signal of more monetary easing ahead. But this rally totally fizzled again in the last two hours of trading as reality sank in that the rescue of the monolines is much harder than hoped for after Fitch revoked its top AAA ranking on Financial Guaranty Insurance Co, one of the bond insurers. So the S&P fell from its day peak by 2.2% and finished the day 0.5% below its opening level in spite of the 50bps gift by the Fed and in spite of the fact that the Fed had reduced policy rates by a whopping 125bps in eight days!"

http://www.rgemonitor.com/blog/roubini/241162/
http://en.wikipedia.org/wiki/Monoline_insurance