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THE NEXT STOCK MARKET CRASH: Why Many Pros Think It Has Already Begun
TBI ^ | 2027-2013 | Sam Ro

Posted on 02/27/2013 6:27:54 AM PST by blam

THE NEXT STOCK MARKET CRASH: Why Many Pros Think It Has Already Begun

Sam Ro
February 27, 2013

Stocks are near all-time highs. And there are plenty of reasons to be terrified...

After coming within points of an all-time high, stocks have begun to stumble, and volatility appears to be returning to the markets.

This has led some market pros to declare that an amazing four-year rally in stocks is over and that we're on the precipice of a new crash.

And there is certainly no shortage of logic to support that view.

Massive U.S. federal budget cuts are looming, political instability in Europe is returning, and currency values around the world are falling.

And by many measures, U.S. stocks look due for a comeuppance. Valuations are elevated, profit margins are at all-time highs, and there are signs of investor complacency everywhere.

Of course, not everyone thinks stocks are headed for a crash. In fact, some experts think we're at the beginning of a new long-term bull market and that investors should go "all-in." But we'll focus on those folks later.

For now... (Click to the site for numerous charts)

(snip)

(Excerpt) Read more at businessinsider.com ...


TOPICS: News/Current Events
KEYWORDS: economy; markets; recovery; stocks
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1 posted on 02/27/2013 6:28:04 AM PST by blam
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To: blam
And there is certainly no shortage of logic to support that view.

But we are living in an age where anything even remotely close to logic appears to have been suspended. Dow 15,000 here we come.


2 posted on 02/27/2013 6:30:22 AM PST by Buckeye McFrog
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To: blam

the stock market is very high, but words like “terrified” “crash” “looming” and “precipice” show that this piece was written by someone who is not serious.


3 posted on 02/27/2013 6:31:14 AM PST by babble-on
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To: blam
BOOM: KEY DETAIL IN DURABLE GOODS REPORT EXPLODES
4 posted on 02/27/2013 6:32:16 AM PST by blam
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To: blam

Not to worry. Obama will print up billions more in monopoly money to further ‘stimulate ‘ something or other and that cash will fuel the market to higher albeit more worthless numbers.


5 posted on 02/27/2013 6:44:24 AM PST by Don Corleone ("Oil the gun..eat the cannoli. Take it to the Mattress.")
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To: blam

^
“Revised December Data

Revised seasonally adjusted December figures for all manufacturing industries were: new orders, $483.4 billion (revised from $484.8 billion); shipments, $483.4 billion (revised from $484.9 billion); unfilled orders, $991.3 billion (revised from $991.7 billion); and total inventories, $614.9 billion (revised from $615.5 billion).”

All revised DOWN, so doesn’t that skew the numbers for January? Unexpected! *DRINK* :)


6 posted on 02/27/2013 6:45:30 AM PST by Diana in Wisconsin (I don't have 'Hobbies.' I'm developing a robust Post-Apocalyptic skill set...)
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To: blam

I wonder if my prediction of people/companies buying things to hold value during the coming inflation is coming true?

I expect PM prices to lead the rise. Then RE, farmland, productive enterprises, vehicles, capital equipment, etc. will be used as inflation hedges.

The smart investors may be borrowing and leveraging with the plan of paying back the loans with inflated fiat.


7 posted on 02/27/2013 6:51:48 AM PST by darth
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To: Buckeye McFrog

The Fed Reserve is pouring money into the stock market....if they were not doing so the stock market would be about 6000 to 7500. Not 13,000 to 14,000.

They simply will not allow it to fall to the proper levels lest Obunghole look bad for his ineptness


8 posted on 02/27/2013 6:54:20 AM PST by Ouderkirk (Obama has turned America into an aristocracy of the unaccomplished.)
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To: Diana in Wisconsin

“Drink, drank, drunk, game” for “unexpected” ?


9 posted on 02/27/2013 6:57:00 AM PST by Ouderkirk (Obama has turned America into an aristocracy of the unaccomplished.)
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To: Ouderkirk

You are, of course, correct. The Fed’s actions are highly illogical. Hence my point.


10 posted on 02/27/2013 6:59:00 AM PST by Buckeye McFrog
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To: Ouderkirk; Buckeye McFrog

My question regarding the protection racket surrounding this president, as we have seen for no other in the history of the nation, is why?


11 posted on 02/27/2013 7:01:02 AM PST by John W (Viva Cristo Rey!)
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To: blam
Well, on the one hand, the stock market may go down. On the other hand, it may go up.

So where do we find a one-handed prognosticator?

12 posted on 02/27/2013 7:01:08 AM PST by proxy_user
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To: babble-on

But... it’s all self-evident the Fed is juicing the market. Pure market manipulation. Funny, how the SEC/NAZ goes after large institutions for moving the market & gives a pass to the FED.


13 posted on 02/27/2013 7:03:24 AM PST by SIRTRIS
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To: John W

He’s the Antichrist or the precursor thereof?

Just a guess.


14 posted on 02/27/2013 7:03:32 AM PST by MrB (The difference between a Humanist and a Satanist - the latter admits whom he's working for)
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To: darth

The fed is printing money and buying stocks with it to prop up the market.

They’ll turn the lights out on folks soon enough.


15 posted on 02/27/2013 7:04:48 AM PST by MrB (The difference between a Humanist and a Satanist - the latter admits whom he's working for)
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To: Ouderkirk

I’m drunk by 8am every day now, LOL!


16 posted on 02/27/2013 7:05:26 AM PST by Diana in Wisconsin (I don't have 'Hobbies.' I'm developing a robust Post-Apocalyptic skill set...)
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To: blam

wasn’t there an article on TBI just last week or the week before by another writer claiming that the Dow’s rise to 20,000 is inevitable?


17 posted on 02/27/2013 7:05:26 AM PST by pgkdan ( "Those who hammer their guns into plows will plow for those who do not." ~Thomas Jefferson)
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To: blam
BOOM: KEY DETAIL IN DURABLE GOODS REPORT EXPLODES

Market prices reflect an emotional response to practical indicators.

This practical indicator along with the purchasing managers index are particularly good.

However, emotion may rule again; but it will fail against results.

18 posted on 02/27/2013 7:07:23 AM PST by cicero2k
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To: Diana in Wisconsin

Love your tagline, did you know that?


19 posted on 02/27/2013 7:12:33 AM PST by Old Sarge (We are officially over the precipice, we just havent struck the ground yet...)
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To: blam

Morgan Stanley on the Durable Goods report:

* Mixed report. Overall durable goods orders plummeted 5.2% in January after a 3.7% gain in December, on a sharp reversal of a surge in defense capital goods (-69.5% v. +107.3%) and a pullback in civilian aircraft (-34.0%). Outside of these two volatile categories, however, nondefense capital goods ex aircraft orders, the key core gauge, surged 6.3%, extending a solid recovery in recent
months from substantial weakness seen through most of last year as policy uncertainty and global growth uncertainty was mounting. This points to improving capital spending growth going forward, but in the near term a 1.0% drop in nondefense capital goods ex aircraft shipments in January pointed to weaker investment. We now see Q1 GDP growth tracking at +1.6% instead of +1.8%.

* The sharp gain in core capital goods orders in January left them up 12.8% in the past four months, more than reversing a 10.0% pullback in the first nine months of last year. A 13.5% gain in machinery orders accounted for the January jump, while orders of high tech equipment were down sharply in a continued failure to show much of any improvement since the recession lows.

* The 6.3% jump in core capital goods orders combined with the 1.0% drop in shipments left unfilled orders for nondefense capital goods ex aircraft up 1.6% after a run of seven straight declines. This points to better capital goods shipments in coming months, but even building in a strong rebound in the near term, the 1.0% drop in January shipments points to a sluggish outlook for Q1 investment.
We now see equipment and software investment rising 2.0% in Q1 instead of 3.1% and overall business investment (with a modest gain expected also in structures) 2.2% instead of 3.1%. Going forward, however, the level of net business investment relative to overall GDP ended 2012 at what we view as still an unsustainably low level, and the turn higher in core orders and unfilled orders was in line with our forecast that investment growth will accelerate over the course of this year and into 2014 as fiscal policy uncertainty diminishes.


20 posted on 02/27/2013 7:13:20 AM PST by Wyatt's Torch (I can explain it to you. I can't understand it for you.)
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To: babble-on

I see it this way: Either it will break through the barrier, fueled by inflation, or it will crash again.

You can bank on it! ;-)


21 posted on 02/27/2013 7:13:33 AM PST by cuban leaf (Were doomed! Details at eleven.)
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To: cicero2k

LOL, for the pros out there. Hype the results so one can get in or out. Keep an eye on the “short” volume. I’ve always wondered about front runners sreaming, “Extra, Extra.. read all about it”


22 posted on 02/27/2013 7:16:21 AM PST by SIRTRIS
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To: pgkdan

“The dow rise to 20,000 is inevitablle”

Well it is. But over what time horizon?


23 posted on 02/27/2013 7:16:57 AM PST by plain talk
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To: blam

Former Fox News guest Gerald Celene kept saying the economy would crash very five minutes. The problem was he kept trying to put a date on things. And that is why he was let go, nothing occurred when he predicted. His Trends Research company was too inaccurate. So while it will happen, I wouldn’t put dates on things.


24 posted on 02/27/2013 7:17:51 AM PST by Mozilla
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To: MrB

So many have scales on their eyes.


25 posted on 02/27/2013 7:22:18 AM PST by Ray76 (Do you reject Obama? And all his works? And all his empty promises?)
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To: blam

I would also say the crash will be slow and not as immediate as some people think. Therefore, nobody is sure how it will go. The SHTF Plan site has a bunch of scenarios they post on YouTube videos. It will take me some time to find the links as it was last summer.


26 posted on 02/27/2013 7:25:05 AM PST by Mozilla
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To: Mozilla
"So while it will happen, I wouldn’t put dates on things."

I agree....when?

27 posted on 02/27/2013 7:26:08 AM PST by blam
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To: blam
In fact, some experts think we're at the beginning of a new long-term bull market and that investors should go "all-in."

Well, in the sense that if you buy today at Dow 14K and sell in 25 years at Dow 100K, this is probably true. If you find yourself in a financial position where you are forced to sell in 2017 at Dow 5K, you might have a very different opinion...

28 posted on 02/27/2013 7:29:57 AM PST by Mr. Jeeves (CTRL-GALT-DELETE)
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To: Ouderkirk
Indeed. There is a reason "don't fight the Fed" is a time honored rule.

Having said that I highly doubt if the "three steps and a stumble" rule will apply this next time. Once the Fed starts it will probably be ugly FAST.

29 posted on 02/27/2013 7:36:39 AM PST by Proud_texan
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To: SIRTRIS

market manipulation yes, but not pure market manipulation. They have other objectives, that they believe will be fostered by pursuing this policy for a while longer, and that they think they can end without destroying the world again.

Are they right? I am agnostic to skeptical, and (pretty uncomfortably heavily in cash)


30 posted on 02/27/2013 7:40:08 AM PST by babble-on
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To: MrB
The fed is printing money and buying stocks with it to prop up the market. They’ll turn the lights out on folks soon enough.

I have been hearing this for over three years. My portfolio is up 32% in that time. Maybe I will listen to the doomsayers this year maybe not. When you are well prepped you can afford to take some risks.

31 posted on 02/27/2013 7:41:57 AM PST by Starstruck (I need a 30 round magazine because liberal whine gives me a buzz.)
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To: blam

May have already begun, but as we have seen an uncountable number of times in the past couple of years, stocks and markets can remain high (i.e. are deliberately kept high) far longer than any economic laws can explain. Bears could be calling every day a top well into May.


32 posted on 02/27/2013 7:43:52 AM PST by jiggyboy (Ten percent of poll respondents are either lying or insane)
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To: blam

Good for another 500+ on the DOW.


33 posted on 02/27/2013 7:45:52 AM PST by MeneMeneTekelUpharsin (Freedom is the freedom to discipline yourself so others don't have to do it for you.)
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To: Diana in Wisconsin

Well don’t be preaching your tee-totaling to us market watchers here in CA where the stock markets open at 6:30. :-)


34 posted on 02/27/2013 7:47:02 AM PST by jiggyboy (Ten percent of poll respondents are either lying or insane)
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To: Starstruck

If you’re playing with “house money”, why not?
The only problem would be a “bank holiday” where they don’t allow you to sell, they just close the market.


35 posted on 02/27/2013 7:55:13 AM PST by MrB (The difference between a Humanist and a Satanist - the latter admits whom he's working for)
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To: cuban leaf

So, it is either going up or going down.

A bold prediction my friend! :o)


36 posted on 02/27/2013 7:57:42 AM PST by PTBAA
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To: Old Sarge

Saw it in a t-shirt - but it’s so ME, I couldn’t resist. :)


37 posted on 02/27/2013 8:04:09 AM PST by Diana in Wisconsin (I don't have 'Hobbies.' I'm developing a robust Post-Apocalyptic skill set...)
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To: jiggyboy

I won’t! We all need SOME form of escape from this madness!


38 posted on 02/27/2013 8:05:50 AM PST by Diana in Wisconsin (I don't have 'Hobbies.' I'm developing a robust Post-Apocalyptic skill set...)
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To: babble-on

huh? Who’s picking up the Fed money, the dumb money or smart money? Pure manipuation from one source, whether calling it juice or sugar coated & there’s plenty of smoke & mirrors going on in the world’s largest casino!

As far as in you being in cash, I get annoyed with the Institutional players (ie Fund Managers) sitting on any amount above 5% cash. Cash makes NO money resting in this market. Unless, you are a senior & have all your money off he table & had your fun transferring wealth.


39 posted on 02/27/2013 8:14:42 AM PST by SIRTRIS
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To: Diana in Wisconsin

Hey I’m not telling you to drink, I’m saying I’m two hours ahead of you, especially on days like yesterday. :-)

Nine-hour bear markets, bah.


40 posted on 02/27/2013 8:19:46 AM PST by jiggyboy (Ten percent of poll respondents are either lying or insane)
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To: plain talk
BTW, here's some other earlier pros buying into the hype: Dow 36,000: The New Strategy for Profiting From the Coming Rise in the Stock Market is a book by James K. Glassman and Kevin A. Hassett. I think boiler room people were using it as a bible selling mining stocks.
41 posted on 02/27/2013 8:22:12 AM PST by SIRTRIS
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To: babble-on

Are you kidding? The stock market is totally controlled, manipulated and propped up...One has to be an idiot to hand their money over to Wall Street.


42 posted on 02/27/2013 8:25:08 AM PST by dragnet2 (Diversion and evasion are tools of deceit)
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To: SIRTRIS

I’m not sure I understand what you’re saying, and I’m almost positive you didn’t understand what I was saying, so let’s just let it lie.


43 posted on 02/27/2013 8:34:37 AM PST by babble-on
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To: dragnet2

I recommend reading lessons.

I said it was market manipulation, by the Fed.

And that I don’t have much money in the market.

It’s not at all clear to me on what point we are in disagreement, and why I therefore must be “kidding.”


44 posted on 02/27/2013 8:38:10 AM PST by babble-on
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To: PTBAA

And I stand behind it.

Uh, them.

;-)


45 posted on 02/27/2013 8:43:29 AM PST by cuban leaf (Were doomed! Details at eleven.)
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To: blam

Wall St. is sending a message to Uncle Ben, “yeah, that $90 billion a month you been giving us to pump up the market, you need to double that.”


46 posted on 02/27/2013 8:47:27 AM PST by Gen-X-Dad
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To: blam

It seems to me that people with lots of cash (not me) only have a few choices: invest in gold or other metals; let it rot in a money market fund with a microscopic interest rate; stuff a mattress; or buy stocks. I think the low interest rates and undesirable bond markets are inflating the price of stocks. If interest rates went up to a point where an investor could gain 6 or 7 percent a year, stocks would look less appealing and the marked would be lower.


47 posted on 02/27/2013 8:52:07 AM PST by folkquest (I plan on being cranky for the next 4 years. Hope to crack a political smile at the midterms!)
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To: Ouderkirk

This.

I don’t see how the stock market can crash when it is being supported with FED Reserve money. It is not like the FED Reserve is going to withdraw their money and crash it.


48 posted on 02/27/2013 8:54:25 AM PST by Freedom_Is_Not_Free (Free goodies for all -- Freedom for none.)
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To: MeneMeneTekelUpharsin
"Good for another 500+ on the DOW."

Stocks Are Surging, Dow Up 130

49 posted on 02/27/2013 10:58:10 AM PST by blam
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To: blam

Hahahahahahahaaaahhahaaa!!!


50 posted on 02/27/2013 12:13:56 PM PST by MeneMeneTekelUpharsin (Freedom is the freedom to discipline yourself so others don't have to do it for you.)
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