Many have claimed the market had bottomed out in March and the housing market also had bottomed. I want to say, give me a break! Here is why:
1) the 90 day moratorium on foreclosure created a false impression for all bank earnings. Now, we are going to say market flooded with house again. Of course, spring is usually good for housing market. But with this wave of foreclosures, we will see price plunging again.
2) Banks are telling delinquent owners to stay in and try to short sale. The real number of houses in problem is way higher than the foreclosure numbers. Another pressure on house price.
3) The housing problem is no longer a subprime problem anymore, it had spread to all.
4) Commercial deliquencies rising sharply making banks holding more troubled loans.
5) People have not yet realized the whole consequences of OB's record deficit time bomb. Once this bomb explodes, we will see the last leg down, which may be the most painful one, and possibly the longest one.
6) Everything about the stock market tells me we are in a severe down turn. The market just had its best six week rally since 1938. These rallies usually happens in bear market. Remeber, we did not even see this kind of explosive rally in the late 1990s bull market.
7) People are still too optimstic, only comparing the current market with 2000 bear market, at most 1970 and 1980 bear market. This kind of optimsim will be crushed as it did in previous markets. most americans especially those who are buying houses now, have never experienced any severe downturns.
8) Now, you may argue that the GOVT is doing things different than the old days, throwing money like crazy. Who said this will be beneficial? It has never been tested. Doing a bit different than what Hoover did in the 1930s may not save the economy, but may also push it to a disastrous situation. We may sometimes listen to what the GOP is saying. Don't get me wrong, I voted for OB and I am a DEM, but on some issues, I do agree with the republicans.
9) Last thing I want say today is, don't believe the results from the stress test anymore. The "stringent condition" that the govt set for the stress test, as OB put it, WILL BE MET. I am not sure how banks will perform after that.
We can wait and see how things pan out. But I should say that be cautious won't make you bankrupt. Right now if you can survive this downturn, you may come out as a rich guy. So, beware of whoever is telling you this is over, especially Cramer at CNBC. He had became an entertainer and only an entertainer now. |
狗仔卡
发表于 2009-4-19 10:54 AM
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。 就是English writing 有点像眼里揉了沙子。 哈哈，如有得罪，请见谅。