Somebody has turned on the tap…for our bloodbath

[Chuck Bao]

The Thai stock market fell 2.35% today on foreign dumping of shares in the market.

You may ask so what. In fact, the Thai stock market is just a piddily little tee-niny market on the other side of the world. Okay, so what?

I was asking some clients today WTF happened and they said that US funds are dumping shares in Asia as they are facing redemptions. Funny isn’t it that I haven’t read much of anything about it in the MSM.

Well, I can see that some developing market funds and particularly some hedge funds are having trouble, especially with the huge losses with the bursting of bubble markets in China and India. They are just taking profit or relatively smaller losses on selling shares in markets elsewhere in Asia.

It’s a pity though because Southeast Asia has relatively strong fundamentals and cheap valuations. Okay, I did just lower my GDP growth forecast for Thailand for this year to 4.5%.

Going back to the redemptions issue, WTF? So, someone sent me an email about a WSJ article about some hedge fund not allowing redemptions. How can they do this?

http://online.wsj.com/article/SB121495893887021511.html

Wouldn’t denying unit holders the right to sell pretty much destroy confidence in the industry and speed up redemptions elsewhere, or scare the other funds to go ahead and dump investments in anticipation of imminent redemptions? How can this ever be justified beyond the age old “self preservation”, “every man for himself” and “it’s a dog-eat-dog world out there” philosophy? Oh besides that, did I ever mention that I think unregulated hedge funds are evil?

Where is the outrage? Where is the MSM in reporting this? Or, is it like reporting on a bank run or yelling “fire” in a cinema? If so, who is in the know and redeeming units?

I’ve always said that individual investors should rely on professional fund managers. But, in these cases, I’m starting to have doubts.

Why do I feel like someone is turning on the tap to our bloodbath?

[Blue]

All the MSM is, is "expert" investors pimping their stock,etc.. They've got to pump sunshine or consumer confidence will go in the tank. [tinfoil hat] Sometimes it feels like it's being done by design. [/tin foil hat]

If oil was a supply and demand issue, where are the long lines at the pumps? Where's the rationing? It feels more political.

[Jerk]

All the MSM is, is "expert" investors pimping their stock,etc.. They've got to pump sunshine or consumer confidence will go in the tank. [tinfoil hat] Sometimes it feels like it's being done by design. [/tin foil hat]

If oil was a supply and demand issue, where are the long lines at the pumps? Where's the rationing? It feels more political.

speculators and self fulfilling prophecies. Widely known speculator buys 100 gillion barrels on the futures market, and states on MSNBC or the WSJ, "oil prices will go up $10 by next month" and voila!; They look like prophets.

Oil companies do not control the price of oil. Go figure.

[StoopTroup]

As long as the Oil Companies are making money...why would they care about the price of oil?

[Blue]

I'm not mad they're making money. I think they're profit percentage is pretty weak too, right? Like 4%?

It's just the unexplainable doubling of the price in such a short time. Who knows what? Are they trying to tank the USD? It doesn't make much sense. It's like the perfect economic storm when you step back and look at different areas.

[Jerk]

As long as the Oil Companies are making money...why would they care about the price of oil?

Because, if the economy collapses, then they will no longer be making money, and that is where this is headed.

Unless you want to pay $10 for a head of lettuce.

[Blue]

When the Dow drops 20% in a day, you'll know the collapse is on. Grab your gun, fill up the tank, and head for olevets hill. :D

[Jerk]

I'm not mad they're making money. I think they're profit percentage is pretty weak too, right? Like 4%?

It's just the unexplainable doubling of the price in such a short time. Who knows what? Are they trying to tank the USD? It doesn't make much sense. It's like the perfect economic storm when you step back and look at different areas.

What the fed has done with the dollar is disturbing. All of the mortgage companies who sold ARMS to stupid people can go broke for all I care. And I don't care about home flippers on the west or east coast, and people who paid 1/4 million for a shotgun house (a shack in LA). What the FED has been doing by lowering interest rates to save real estate has also killed the dollar, which has contributed to the price of oil and has given ALL of us a nice little pay cut.

LET THEM GO BROKE!!!

F*** countrywide and the rest of them. Mortgage brokers are worse than used car salesman, and the banks who fund their loans are the enablers.

[bluedogok]

There is a similar speculator market manipulations in other areas. A contractor that we are working with on a project said that steel prices have go up 50% since the beginning of the year. What is happening is that China is buying bulk quantities of US made steel and selling it back in smaller quantities at a much higher markup. In many cases the steel never leaves the US, it gets delivered from the manufacturer to the fabricator to the site all with the Chinese taking profit off the deal. The Chinese are all about free enterprise as long as it is outside of their borders.

[Blue]

They can't lower and they can't raise them. They're in a corner at the moment and not to be to pessimistic ;) but more bubbles are going to burst.

Europe, today, basically told us to go F ourselves by raising int. rates over there. I'm thinking it won't be long before the dollar gets dumped by other countries in favor of the Euro. It's already happening. Other countries can't hide our debt anymore. Pay up or we're dumping yer shat.

I wish I would have paid more attention in Finance class. All this "Invest in gold/silver crap? What good is a gold bullion when food is the commodity of priority?

Ok, breathe. You really can't tell things are bad right now. Business as usual. I just have a gut feeling all the smoke and mirrors the fed has put up for years are coming down.

[tommieharris91]

They can't lower and they can't raise them. They're in a corner at the moment and not to be to pessimistic ;) but more bubbles are going to burst.

They will raise rates because right now, the survey data is showing that the US consumer is more worried about inflation than recession.


Europe, today, basically told us to go F ourselves by raising int. rates over there. I'm thinking it won't be long before the dollar gets dumped by other countries in favor of the Euro. It's already happening. Other countries can't hide our debt anymore. Pay up or we're dumping yer shat.
They told most of the euro zone the same thing. The ECB will probably be forced to cut interest rates in the near future. The only country that is doing well in the euro zone is Germany and even German GDP growth is slowing down.

[Jerk]

I will say this: if there is any "good" news, it is that when we sneeze, the rest of the world gets a cold. What I am saying is that anyone who wishes and prays for our demise had better watch out. China will have a hard time selling cheap crap in Wal-Mart if no one is buying it.

Better go plant a victory garden...not to help your country win a world war, but so you can eat.

[tommieharris91]

I will say this: if there is any "good" news, it is that when we sneeze, the rest of the world gets a cold. What I am saying is that anyone who wishes and prays for our demise had better watch out. China will have a hard time selling cheap crap in Wal-Mart if no one is buying it.

Better go plant a victory garden...not to help your country win a world war, but so you can eat.

Not anymore. US GDP is only 18% of world GDP these days. Trickle-down doesn't work anymore because our money is trickling down to China and Mexico.

[Chuck Bao]

Okay, here is a really, really perverse thought. Once the oil price bubble does burst, all of those hedge funds dumping equity and buying oil futures are going to go bankrupt and possibly take a few more investment banks down with them and spark another round of the financial crisis in the US.

At this point, I don't think we have the right to hope for an orderly market.

Did I say this before? Smart people can always be counted on making the stupidiest mistakes.

[Blue]

unless it doesn't come back down and settles where they want it. 200-250.

[tommieharris91]

Yea, but then the US consumer will have lots of money because things will be cheap again.

[Jerk]

Yea, but then the US consumer will have lots of money because things will be cheap again.

That's one of the few things I remember from economics. This is all cyclical. Unfortunately, we are coming upon the bad part.

[Blue]

This is all cyclical.

http://www.sdbc.org/photos/albums/userpics/10012/normal_BrokenBicycle.jpg

[Jerk]

http://www.sdbc.org/photos/albums/userpics/10012/normal_BrokenBicycle.jpg

LOL!!

[Chuck Bao]

http://www.sdbc.org/photos/albums/userpics/10012/normal_BrokenBicycle.jpg

And I was wondering what happened to my investment vehicle.

[bluedogok]

Okay, here is a really, really perverse thought. Once the oil price bubble does burst, all of those hedge funds dumping equity and buying oil futures are going to go bankrupt and possibly take a few more investment banks down with them and spark another round of the financial crisis in the US.

At this point, I don't think we have the right to hope for an orderly market.

Did I say this before? Smart people can always be counted on making the stupidiest mistakes.
The sad thing is, those "smart" people never seem to learn from history. What is the old quote

"Those who fail to learn the lessons that history teaches, are doomed to repeat them"

It seems that the cycle just repeats itself.

[GottaHavePride]

http://www.sdbc.org/photos/albums/userpics/10012/normal_BrokenBicycle.jpg

http://www.mentalfloss.com/wp-content/uploads/2007/04/invisible_bike_crash_410.jpg