Are we facing a meltdown on wall street??
Answers:
long or short == yes on the short -- no on the long
It looks similar to the bazaar have made a bottom today (possibly). If the marketplace begin to activate, I would look for it to assemble till around 9/14/07 (or within abouts). If the marketplace make a top around after (9/14) and moves down, I would suspect that we can see a fast an hostile down move within mid/late October or untimely November. But, I wouldn't consider that a crucial bottom. The flea market may call up after that, but I suspect it will roll over and switch on a multi-year suffer bazaar that may end 15 years and see the Dow lose as much as 11,000 - 12,000 points, ie, Dow should ends its take on bazaar around the year 2022 and at Dow 1,000 - 2,000 scope.
If you stingy, "Will this marketplace rest?" the answer as expected is YES. But could we run down further, you bet. There is a crisis looming tied to bank who created mortgage loans for homes that be overvalued and for relatives that could not afford them. Now that the home values enjoy gone down and the interest rates hold gone up, these marginal loans are naissance to defaulting. 2-3 years ago Wall St get into the home mortgage winter sport by funding CMO or Collateralized Mortgage Obligations. Why should solely the bank/mtge company product money when nearby be BILLIONS of dollars available through the credit marketplace.. Now those instruments are defaulting, and the big money center bank cant find anyone to buy them.. So the Federal Reserve Bank today put $14B in liquidity into the open market essentially bailing out the impossible loans, within 3 steps.
So, what make a stock open market? A difference of opinion !
Some individuals see the decline as the close of the world, others see it as bargain..stocks on public sale. What happen subsequent? My belief is we walk down until we gain to more or less 20% past its sell-by date the giant of Dow 14,000 or 2,800. So we've given fund just about 1,000 points.. I regard here is another 1,800 to step beforehand we be in motion up..and afterwards..we jump up A LOT !!
In the meantime, buy put option (look it up) to protect your stocks and get rid of satisfactory to know how to sleep at dark..
Good Luck !
ED
PS. These are my opinion and no direction is suggested. Do your own homework formerly you invest in the stock marketplace.
No one can notify for dependable. The loan stupidity and house price greed be five or six years within the making. Expect one or two years of fallout.
The souk will travel rather lower over the subsequent week or so, until the consequences of the sub prime lend become clear and consequently it will shoot up again. I do not know roughly you, but I am buying.
The souk is still beneath accummulation, so does not appear to be a meltdown.
First, to 4XTRADER, How can you believe the DOW is head to 2000, are you crazy(no disrespect) but how can you speak that. We lately have a bigger than expected correction,
I see the DOW achieve 14,400 this year.