Where next for the Economy and the Markets

[Mick Mac]

"The Fed comment was certainly not unexpected, but it does lower the bar for the economy. There is a continuous flight to safety and the fact that major indexes broke above technical range is certainly making people think about a minor correction," said Tim Ghriskey, chief investment officer of Solaris Asset Management in New York.

I'm not an investment professional like you Hal - but I think part of the problem is we have so many short term investors and investment managers who are overly active. Therefore even a minor correction results in over selling. Its seems more pronounced than in the past.

[HAL9000]

Volatility is about the only thing that has gone up consistently since I began trading in the late 1960s. Volatility, it can be argued, is a product of uncertainty.

Efficient free markets require massive levels of liquidity: short-term traders provide that essential element - there's no way around that.

Without speculators, scalpers, arbitragers, hedgers and risk-takers efficient free markets cannot exist.

[Mick Mac]

?While we do not expect growth to reach the pace of the initial post-recession phase, easy monetary conditions are working across global financial markets, and it is simply a matter of time before that provides a lift to real activity,? said Larry Kantor, Head of Research at Barclays Capital. ?Emerging markets should continue to outperform developed markets, and we see the massive underperformance of equities relative to credit nearing an end.?

Thats pretty much how I see it. So I was pleased to see these comments today.

[????]

The FTSE 100 peaked at 6,930 at the end of 1999 it's at 5600ish today.....wack in real prices and a FTSE tracker taken out then's lost what say 50%..."you have to see shares as a long term investment of more than 5 years" as overpaid fund managers keep saying....my arse as I keep saying. The only way to make proper money trading is through volatility. Investings for mugs, gamblings where it's at. Be safe, stick it in the bank for 2.6% net or gamble......

[Mick Mac]

OOOOOh

Have you been in the potato famine depressed Irish backwater for the week ?

Doom and gloom.

March 2009 - the Dow Jones was 6626 - today it closed at 10,662....

What would the bank have given you in the same time.

Cycles my friend, cycles.

[????]

Ireland's economy is well and truly f*cked...it makes ours look like China. The Dow hit 10,000 back in March 1999 too, that's a great decade.Horses and poker is the way forward.

[Mick Mac]

Cycles - invest now ..... get out later.

Horses are noooo good.

(Wait till I find the property prices thread - you will be hiding then....:))

[Mick Mac]

HAL9000 Wrote:

> About due for a good correction by the look of my

> trading screens this morning. The Euro and Gold

> may have peaked short term, too.

Not much of a correction in the end Hal - Dow Jones up 180 points today. The upward treand continues.

[HAL9000]

The speculator's life is never dull. BTW, I'm not a day trader: my time horizon is measured in weeks and months - sometimes even years.

Corrections often occur when the media is buzzing and the masses come to believe that a move will never end: that's always a good time to lock-in profits or bet against the crowd.

[Mick Mac]

With todays news of 0.8% growth - it is construction that is taking the lions share of this growth. Building is back. That is very positive.

[DJKillaQueen]

I think it's too early to say. We need to see the impact of public sector cuts on jobs before we can say for sure the recession is over.

[Mick Mac]

Todays news is postive - I think that is a fact.

What happens in the next year or so as the cuts kick in is a necessary evil for me, from which we will come out stronger.

What is more important is the the immediate news before these cuts kick in is good, low interest rates and QE have proved to be helpful in sustaining some amount of consumer confidence.

Don't forget we have been in this mess from end 2007/summer 2008 - so there has already been a significant period of adjustment for business from which we are now hoping to gradually crawl out of.

The bottom was some time ago, for me.

[DJKillaQueen]

Well interest rates are expected to go up. Combine that with job losses, increased reposessions, increased pressure on housing following that and HB cuts....suddenly there's no guarantee of anything.

I agree there is a necessary evil to be had, but not one where the result will be an increased lack of social mobility for the lowest paid and a growing gap between rich and poor. Much of what has been proposed has nothing to do with generating a fair and balanced and stable economy and everything to do with the same old core Tory values of survival of the fittest, put into place by people who have absolutely no concept of the impact of low pay, unemployment, homelessness, and so on.

[SeanMacGabhann]

judging by the amount of self-satisfied corwing and back-slapping after osbornes speech last week, I'm not sure they think it's an evil at all

[Jeremy]

DJKillaQueen Wrote:

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> Well interest rates are expected to go up.

Of course, but when? How much by?

The 0.8% growth driven by construction is a bit of a red herring for me, firstly because construction was previously in the pits, and secondly because I am not sure how sustainable it is, in a very uncertain climate.

The cuts... I am sure that they will strengthen the economy, but at what cost? Initially I was in favour, but are they cutting too much too soon? The US are taking a very different approach, it will be interesting to compare our fortunes over the next few years.

[Mick Mac]

Construction is often a key indicator of economic trend, to the extent that it reflects the appetite of business for expansion.

[SeanMacGabhann]

This wave of construction could be the last gasp of effort before contracts are nixed and money runs out - I hope that view is wrong and it IS a good sign, but I wouldn't bet the house on it

[Mick Mac]

Government contracts will dry up but some private sector real estate funds are starting development projects again. But yes longer term its all dependent on the success of the wider economy.

[Loz]

I work for a company who does a lot of public sector work. We're seeing more pressure on price, but certainly no sign of contracts 'drying up'. And these are not big 'spend it quick while we've got it' deals, but multi-year operating contracts.

[Mick Mac]

Mick Mac Wrote:

-------------------------------------------------------

> OOOOOh

>

> Have you been in the potato famine depressed Irish

> backwater for the week ?

>

> Doom and gloom.

>

> March 2009 - the Dow Jones was 6626 - today it

> closed at 10,662....

>

> What would the bank have given you in the same

> time.

>

> Cycles my friend, cycles.

Looking back to this old thread from 2010.

And this week the Dow Jones broke 25,000.......

[Elphinstone's Army]

legalbeagle Wrote:

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> I was once told, in all seriousness, that hemlines

> are a leading indicator of economic conditions.

> Any fashionistas out there who can tell us whether

> skirts are long or short this season?

we are all wearing trousers/culottes/city shorts, what does that tell you?