Jun

25

Podcast: The Prophets of Gloom

By Pete | Filed Under The Podcast | Start a Discussion 

scaredyquirrel.jpg “Remember, if all else fails, playing dead is always a good option!” — Scaredy Squirrel

Ah, it’s that time again: the Prophets of Gloom are out in force. In today’s podcast, we discuss market sentiment and what the charts look like.

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Leading the charge was Royal Bank of Scotland credit strategist Bob Janjuah’s prediction of the S&P dropping 20% by September and Louise Yamada’s call that a big head and shoulder’s pattern is in place for the Dow Industrials.

There’s more:

  • Buyout reckoning coming, BIS predicts
    For the moment, the market is focused on the inability of buyers to find loans to do new deals, but private-equity firms will soon find themselves searching for loans to keep alive the companies they have already bought in debt-heavy takeovers, the banking umbrella group said. The original deals were financed by debt with easy terms that’s not going to be available in the current market.
  • BIS: Economy Nears ‘Tipping Point’
    The global economy may be close to a “tipping point” that could see it enter a slowdown so severe that it transforms the current period of rising inflation into a period of falling prices, the Bank for International Settlements said Monday. In its annual report, the central bank for central banks said the impact of rising food and energy prices on consumers’ incomes, combined with heavy household debts and a pullback in bank lending, may lead to a slowdown in global growth that “could prove to be much greater and longer-lasting than would be required to keep inflation under control.” “Over time, this could potentially even lead to deflation,” it said. [READ FULL REPORT]
  • Buy ‘Crash Protection’ Puts on European Stocks, Goldman Says
    Investors should buy “crash protection” against a plunge this year in European stocks because losses are likely and insurance costs are low, according to Goldman Sachs Group Inc. The world’s most-profitable securities firm recommended Dow Jones Euro Stoxx 50 Index puts that expire in December and have a strike price of 3,000, or 11 percent less than the measure’s closing level today.
  • Gloom and Doom
    Charles Kirk reports that Jim Cramer said on Thursday, June 26: “Sell everything. Nothing’s working. Revisit when the prices are adjusted for a big recession, soaring inflation and a crushed consumer. Sell at 12,000 and come back at 10,000. Even better: short it.“
  • Rallies Are to be Sold
    Investors looking for positive developments as the morning goes on are hard-pressed to find them, as equities of late were bouncing around near the lows of the session. Traders say the investing community has been quick to sell shares on rallies, taking advantage of brief surges to get out of positions with profits (or losses, of course).
  • Citigroup sinks to 10-year low, Goldman urges short sale
    William Tanona, the Goldman analyst, added Citigroup to Goldman’s “Americas conviction sell” list and cut his price target on the stock to $16 from $20. He recommended a “paired” trade in which investors sell Citigroup shares short, betting on a decline, and buy Morgan Stanley shares.
  • BlackRock Sees Global Slowdown Worsening In 2009
    Kapito, citing slowing growth in emerging markets and tightening pressures on the U.S. consumer, said BlackRock expects a much bigger slowdown in 2009. “We think there’s going to be a global slowdown,” he said at a lunch sponsored by the Securities Industry and Financial Markets Association in New York. . . . Using a baseball reference, Kapito said the credit crisis is in the fourth inning, indicating he believes the crisis is nearly halfway over.
  • Head and shoulders top forming on the Dow? (Thanks Richard!)
    With the recent downdraft, the Dow industrials have closed in on treacherous technical territory.
  • Bubble Alert! Bond Market Could Be Next To Burst (Via TheKirkReport.com)
    Where is the next big financial bubble? Thank you for being on the little guy’s side.
  • June 23rd Blogger Sentiment Poll
    Bloggers are bearish for the week.
  • Stock-market towel hasn’t been thrown in yet
    It’s too early to tell whether the stock market has successfully passed its retest of the March lows.
  • Global Markets Struggle With Inflation
    Stock markets around the world have been weaker recently as they struggle with the implications of global inflation.
  • Millionaires’ Club Gets Bigger
    All Star Hedge Fund managers named.

Market Sentiment Survey

The InVivo Objective Sentiment Survey tracks the number of buy and sell signals amongst the constituent stocks of the S&P 100 and NASDAQ 100 indexes.

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Summer Reading

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