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Dow Dives As Dollar Gains, Thanks Greece!  
User currently offlineua777222 From United States of America, joined Dec 2003, 3348 posts, RR: 11
Posted (4 years 5 months 3 weeks 19 hours ago) and read 3553 times:

DOW is currently down 250 points. As this bailout of Greece makes its way, the Euro has weakened and the dollar has grown stronger, but imports/export costs are causing a massive selloff today.


"It wasn't raining when Noah built the ark."
51 replies: All unread, showing first 25:
 
User currently offlineKappel From Suriname, joined Jul 2005, 3533 posts, RR: 17
Reply 1, posted (4 years 5 months 3 weeks 19 hours ago) and read 3541 times:

EU exports should benefit from this (Airbus won't be sad by a decline in the Euro), but it is a worrying trend, even moreso now that Spain and Portugal are slipping as well. For now, Spain is convinced they can turn it around themselves, let's hope so! Not only for the EU, but for Spain itself as well of course.


L1011,733,734,73G,738,743,744,752,763,772,77W,DC855,DC863,DC930,DC950,MD11,MD88,306,319,320,321,343,346,ARJ85,CR7,E195
User currently offlineAaron747 From Japan, joined Aug 2003, 8184 posts, RR: 26
Reply 2, posted (4 years 5 months 3 weeks 18 hours ago) and read 3530 times:

Quoting Kappel (Reply 1):
For now, Spain is convinced they can turn it around themselves, let's hope so! Not only for the EU, but for Spain itself as well of course.

Still small potatoes to what would happen with a run on the Japanese yen. Public debt is now at somewhere in the neighborhood of 190% of GDP, second only to Zimbabwe.  Wow!



If you need someone to blame / throw a rock in the air / you'll hit someone guilty
User currently offlinenewark777 From United States of America, joined Dec 2004, 9348 posts, RR: 29
Reply 3, posted (4 years 5 months 3 weeks 18 hours ago) and read 3489 times:

These daily swings aren't necessarily indications of a broader swing. If anything, it shows that investors aren't really sure which way the broader market is going, and are reacting quickly to any new news that comes across the wire. Remember, the Dow was up 143 yesterday.


Why grab a Heine when you can grab a Busch?
User currently offlinegatorfan From United States of America, joined Oct 2009, 331 posts, RR: 1
Reply 4, posted (4 years 5 months 3 weeks 18 hours ago) and read 3418 times:

I don't think we (the US) should be pointing fingers at anyone when it comes to fiscal responsibility.

User currently offlinenewark777 From United States of America, joined Dec 2004, 9348 posts, RR: 29
Reply 5, posted (4 years 5 months 3 weeks 18 hours ago) and read 3373 times:

Quoting gatorfan (Reply 4):
I don't think we (the US) should be pointing fingers at anyone when it comes to fiscal responsibility.

The US Federal Government never even came close to defaulting on any loans, it's a completely different scenario. No point in holding back punches, Greece led themselves down this road.



Why grab a Heine when you can grab a Busch?
User currently offlinegatorfan From United States of America, joined Oct 2009, 331 posts, RR: 1
Reply 6, posted (4 years 5 months 3 weeks 16 hours ago) and read 3265 times:

Quoting newark777 (Reply 5):
The US Federal Government never even came close to defaulting on any loans, it's a completely different scenario. No point in holding back punches, Greece led themselves down this road.

Without in any way excusing or justifying Greece's actions - they made their bed.... The US gov't is completely bankrupt. The only difference is that we are too big to fail while Greece isn't. The US gov't will do what Greece can't do (because of its membership in the Euro) and that's allow our currency to devalue over time. That way the present value of the debt declines.

The US has absolutely no ability to pay its existing obligations. While we talk about a $14T debt, medicare and social security (for people who are alive today) already represent over $50T of future spending. Put that in perspective (that's about 12x what we spent in total this year as a federal gov't).


User currently offlinenewark777 From United States of America, joined Dec 2004, 9348 posts, RR: 29
Reply 7, posted (4 years 5 months 3 weeks 16 hours ago) and read 3256 times:

Quoting gatorfan (Reply 6):
The US gov't is completely bankrupt.

Not bankrupt, in debt. If the US were to become insolvent, we would have much bigger issues, while Greece was so insolvent that they were headed towards missing a debt payment this May 19th. Nowhere near the same degree of seriousness.

Quoting gatorfan (Reply 6):
The US gov't will do what Greece can't do (because of its membership in the Euro) and that's allow our currency to devalue over time. That way the present value of the debt declines.

It's not so much that they can't let it devalue, it's just that the value of their Euro currency is tied into the value of all the nations collectively, of which Greece is a small percentage. Therefore Greece's issues don't have a significant impact on the currency valuation.

And no one lets or doesn't let a currency devalue, they are all market rates (except for China).

Quoting gatorfan (Reply 6):

The US has absolutely no ability to pay its existing obligations. While we talk about a $14T debt, medicare and social security (for people who are alive today) already represent over $50T of future spending. Put that in perspective (that's about 12x what we spent in total this year as a federal gov't).

While the US is in a serious debt problem long term, entitlement programs are not the same as issued debt. Saying we can't provide as much Social Security or Medicare in the future has fewer ramifications than if we were to not be able to pay back the debt held by other countries.



Why grab a Heine when you can grab a Busch?
User currently offlineIMissPiedmont From United States of America, joined May 2001, 6305 posts, RR: 33
Reply 8, posted (4 years 5 months 3 weeks 16 hours ago) and read 3226 times:

It's just a slowdown in the DJIA going back up to a ridiculously inflated, meaningless value.


Damn, this website is getting worse daily.
User currently offlineoa260 From Ireland, joined Nov 2006, 27110 posts, RR: 60
Reply 9, posted (4 years 5 months 3 weeks 15 hours ago) and read 3201 times:

Quoting ua777222 (Thread starter):
Thanks Greece! 

Parakalo   



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Every cloud has silver lining ! Except ash clouds of course  


User currently offlinegatorfan From United States of America, joined Oct 2009, 331 posts, RR: 1
Reply 10, posted (4 years 5 months 3 weeks 14 hours ago) and read 3146 times:

Quoting newark777 (Reply 7):
Not bankrupt, in debt. If the US were to become insolvent, we would have much bigger issues, while Greece was so insolvent that they were headed towards missing a debt payment this May 19th. Nowhere near the same degree of seriousness.

First of all, national gov't can't be bankrupt. Bankruptcy is a statutory construct of the law where by a court of the sovereign discharges the debts of the debtor. Since the national gov't is the sovereign they themselves can't file bankruptcy - and sovereign immunity restricts a foreign court from adjudicating another sovereign in default.

But when used colloquially, a national bankruptcy is the equivalence of insolvency. The US is insolvent by any measure. We use accounting games to cover the insolvency. You want to see how insolvent the US is - we kiss China's ass and beg them not to try to sell all our bonds at once on the secondary market because the value of the bonds would drop so much that nobody would buy original issue bonds from the Treasury. Tell me, exactly how many weeks or months could the US go without rolling its debt?

But more so than that - we use one "credit card" to pay the other - using social security trust funds to pay current budget expenses while simply not accounting for cost of social security on budget (only current period expenditures).

Quoting newark777 (Reply 7):
It's not so much that they can't let it devalue, it's just that the value of their Euro currency is tied into the value of all the nations collectively, of which Greece is a small percentage. Therefore Greece's issues don't have a significant impact on the currency valuation.

They can't devalue because they don't set the value of the Euro. That's precisely the problem. When a country devalues its currency, it simply refuses to exchange it at a previously set price. Without exchange controls devaluation can't happen because the market already reflects the value of the local currency in units of foreign currency (that's what market exchange rates are).

If the Greeks tried to "devalue", all anyone holding Greek currency would have to do is go to another EU country and exchange their money for something else. There is no such thing as the value of a German Euro or a Greek Euro. They are all Euro's. To effect a devaluation the Greeks would first have to relaunch a currency, the drachma. Fix an exchange rate (thereby allowing debtors to pay their Euro denominated debts in the fixed numbers of Drachmas (sp?)). Of course that would cause immediate inflation for all imported goods.


User currently offlineLAXintl From United States of America, joined May 2000, 25741 posts, RR: 50
Reply 11, posted (4 years 5 months 3 weeks 14 hours ago) and read 3101 times:

Well the Obama and company should be happy as they have publicly called for a stronger dollar.


From the desert to the sea, to all of Southern California
User currently offlinedeltaownsall From United States of America, joined Jul 2001, 1173 posts, RR: 1
Reply 12, posted (4 years 5 months 3 weeks 14 hours ago) and read 3101 times:

Quoting gatorfan (Reply 6):
The US gov't is completely bankrupt.

You don't present an unreasonable line of reasoning, but this statement in and of itself smacks of sensationalist youtube nonsense. Yes, according to multiple youtube videos, the U.S. has been "bankrupt" for years. Of course, there are myriad reasons why the US govt is in fact not insolvent, not the least of which being its exceptional status as the global hegemon (yes, the US still has the largest national economy and military by far) and the extraordinary room for error we've had since Bretton Woods, though they're certainly testing this position with their considerable fiscal irresponsibility. So no, the gov't is not 'bankrupt', but I agree that to think we're immune to an eventual downfall down the road (possibly within 10 years) if the gov doesn't get its act together is extremely foolhardy. On the other hand, despite some zealot nut PLA officers' fantasies, China will not be dumping a considerable amount of U.S. treasuries anytime soon. The reasoning here should be obvious.

Quoting Aaron747 (Reply 2):
Still small potatoes to what would happen with a run on the Japanese yen. Public debt is now at somewhere in the neighborhood of 190% of GDP, second only to Zimbabwe.

It's funny, you rarely hear about Japan's debt issues over here (in the mainstream at least). Everyone is so gaga over pontificating not if but when the United States will fall to its knees based on its debt that I feel like they'd be loathe to admit that other rich countries are in the same or possibly worse boat. Could someone explain how Japan's huge stock of money could affect tolerance for their huge debt ratio?


User currently offlineAGM100 From United States of America, joined Dec 2003, 5407 posts, RR: 17
Reply 13, posted (4 years 5 months 3 weeks 13 hours ago) and read 3075 times:

The real question is .... who is buying today ? We want ups and downs ...right ?

I have been selling but we need a couple of down days to set up for buying back in .... what looks good ? Can google go back up to 625.00 was their a month ago ?



You dig the hole .. I fill the hole . 100% employment !
User currently offlinenewark777 From United States of America, joined Dec 2004, 9348 posts, RR: 29
Reply 14, posted (4 years 5 months 3 weeks 13 hours ago) and read 3074 times:

Quoting gatorfan (Reply 10):
First of all, national gov't can't be bankrupt. Bankruptcy is a statutory construct of the law where by a court of the sovereign discharges the debts of the debtor.

Which is why I used insolvency in my post.

Quoting gatorfan (Reply 10):
But when used colloquially, a national bankruptcy is the equivalence of insolvency. The US is insolvent by any measure. We use accounting games to cover the insolvency. You want to see how insolvent the US is - we kiss China's ass and beg them not to try to sell all our bonds at once on the secondary market because the value of the bonds would drop so much that nobody would buy original issue bonds from the Treasury. Tell me, exactly how many weeks or months could the US go without rolling its debt?

But more so than that - we use one "credit card" to pay the other - using social security trust funds to pay current budget expenses while simply not accounting for cost of social security on budget (only current period expenditures).

No, insolvency is not being able to pay your debts. If you can pay your debts, you may still be in trouble, but not insolvent. Governments are tricky, because they play by different rules than businesses.

Bottom line, though, is that Greece was close to default, while the US is not.

Quoting gatorfan (Reply 10):

They can't devalue because they don't set the value of the Euro. That's precisely the problem. When a country devalues its currency, it simply refuses to exchange it at a previously set price. Without exchange controls devaluation can't happen because the market already reflects the value of the local currency in units of foreign currency (that's what market exchange rates are).

If the Greeks tried to "devalue", all anyone holding Greek currency would have to do is go to another EU country and exchange their money for something else. There is no such thing as the value of a German Euro or a Greek Euro. They are all Euro's. To effect a devaluation the Greeks would first have to relaunch a currency, the drachma. Fix an exchange rate (thereby allowing debtors to pay their Euro denominated debts in the fixed numbers of Drachmas (sp?)). Of course that would cause immediate inflation for all imported goods.

No one is debating that, thanks for the ECO 101 lesson.

Quoting LAXintl (Reply 11):
Well the Obama and company should be happy as they have publicly called for a stronger dollar.

In the long term, you want a stronger dollar. A boost to exports is just a temporary benefit to the weakening of the currency.

Quoting deltaownsall (Reply 12):
Yes, according to multiple youtube videos, the U.S. has been "bankrupt" for years.

Before everyone starts throwing these terms around more:

Bankrupt: Court declares a person or company cannot repay its debt.
Insolvent: A person or company is in a state in which it cannot repay its debt.
Default: When a person, company, or government entity does not deliver a debt payment.



Why grab a Heine when you can grab a Busch?
User currently offlinenewark777 From United States of America, joined Dec 2004, 9348 posts, RR: 29
Reply 15, posted (4 years 5 months 3 weeks 13 hours ago) and read 3050 times:

Quoting AGM100 (Reply 13):
The real question is .... who is buying today ?

You would be shocked at how much trading these days is electronic, based on algorithms.

Quoting AGM100 (Reply 13):
We want ups and downs ...right ?

High volatility is good for a trader; better chance of making a profit. Lower volatility is safer, but more inclined to the buy and hold mentality.

Quoting AGM100 (Reply 13):
I have been selling but we need a couple of down days to set up for buying back in

Chasing the market is always dangerous, but I don't know how much experience you have.



Why grab a Heine when you can grab a Busch?
User currently offlinedeltaownsall From United States of America, joined Jul 2001, 1173 posts, RR: 1
Reply 16, posted (4 years 5 months 3 weeks 13 hours ago) and read 3024 times:

Quoting newark777 (Reply 14):
Before everyone starts throwing these terms around more:

Bankrupt: Court declares a person or company cannot repay its debt.

that's why it was in quotes.  


User currently offlineAGM100 From United States of America, joined Dec 2003, 5407 posts, RR: 17
Reply 17, posted (4 years 5 months 3 weeks 13 hours ago) and read 3021 times:

Quoting newark777 (Reply 15):
Chasing the market is always dangerous, but I don't know how much experience you have.

Always good advise newark.... I tend to buy units in my long term portfolio as they drop below a limit. I have a portfolio of long range ... and a portfolio of shorter plays. Today may be a day to buy some shorts ... I have been selling my shorts over the past few weeks.... mainly before CG's go to 25%.....  



You dig the hole .. I fill the hole . 100% employment !
User currently offlinenewark777 From United States of America, joined Dec 2004, 9348 posts, RR: 29
Reply 18, posted (4 years 5 months 3 weeks 13 hours ago) and read 2991 times:

Quoting AGM100 (Reply 17):
mainly before CG's go to 25%....

Ugh, tell me about it. It sounds like you know what you're doing, though. One common problem with many inexperienced investors is that they buy in when they hear all the good news about how high the market is going, but this is often towards market peaks. Then they panic and sell when it falls off a cliff. This just makes things worse.



Why grab a Heine when you can grab a Busch?
User currently offlineua777222 From United States of America, joined Dec 2003, 3348 posts, RR: 11
Reply 19, posted (4 years 5 months 3 weeks 11 hours ago) and read 2914 times:

DOW -2.02% (-225) to close just under 11K.


"It wasn't raining when Noah built the ark."
User currently offlineeinsteinboricua From Puerto Rico, joined Apr 2010, 3181 posts, RR: 8
Reply 20, posted (4 years 5 months 2 weeks 6 days 20 hours ago) and read 2753 times:

Well, let's look at it this way: travels to Europe should be cheaper!l 


"You haven't seen a tree until you've seen its shadow from the sky."
User currently offlineAGM100 From United States of America, joined Dec 2003, 5407 posts, RR: 17
Reply 21, posted (4 years 5 months 2 weeks 6 days 17 hours ago) and read 2629 times:

Quoting newark777 (Reply 18):
Ugh, tell me about it.

Kind of makes investing a bad deal all the way around when you must make say minimum 30%+ to make long term even worth doing. I mean how many portfolios long or short net 30-40% ? to cover? If the G ...is taking 25% even 20% not sure why we even do it . May as well put it in a bank and get 3% and be happy...

I am not very good , but I enjoy strudying and reading about companies and products ... so it kinda fits. But I will be honest I just cant get optomistic ... I want too .. I really try hard to be optomistic but its a day to day struggle now.



You dig the hole .. I fill the hole . 100% employment !
User currently offlinenewark777 From United States of America, joined Dec 2004, 9348 posts, RR: 29
Reply 22, posted (4 years 5 months 2 weeks 6 days 16 hours ago) and read 2590 times:

Quoting AGM100 (Reply 21):

Kind of makes investing a bad deal all the way around when you must make say minimum 30%+ to make long term even worth doing. I mean how many portfolios long or short net 30-40% ?

Although it is a significant increase, the tax is still only on increases to the tax basis, so you aren't going to go from a profit to a loss because of the CG tax. It just makes any profits you make smaller. There are many tax equivalent yield calculators available online where you can plug in the different variables to determine what securities are more worthwhile. These are usually used to determine whether you should invest in munis vs. commercial bonds, but you can take the formulas and apply them to this as well.

Quoting AGM100 (Reply 21):
I am not very good , but I enjoy strudying and reading about companies and products ... so it kinda fits. But I will be honest I just cant get optomistic ... I want too .. I really try hard to be optomistic but its a day to day struggle now.

Many people are in the same boat. Best advice is just not to panic and make any irrational decisions. Know when to hold em and know when to fold em. As long as you have your portfolio diversified to your desired risk level (growth, income, security, etc.), you'll be ok in the long run.



Why grab a Heine when you can grab a Busch?
User currently offlineAGM100 From United States of America, joined Dec 2003, 5407 posts, RR: 17
Reply 23, posted (4 years 5 months 2 weeks 6 days 16 hours ago) and read 2559 times:

Quoting newark777 (Reply 22):
There are many tax equivalent yield calculators available online where you can plug in the different variables to determine what securities are more worthwhile.

Good advise again ... we have more tools available to us then we know.

Quoting newark777 (Reply 22):
Best advice is just not to panic and make any irrational decisions. Know when to hold em and know when to fold em. As long as you have your portfolio diversified to your desired risk level (growth, income, security, etc.), you'll be ok in the long run.

With all of the information available now in my opinion it can be a double edge sword. When you can go online and instantly see that your BRK.B holdings have been downgraded to neutral , split and are falling ...it makes the hold a little tougher. But you are right , you have to keep perspective and remember why you bought the stock in the first place.



You dig the hole .. I fill the hole . 100% employment !
User currently offlinenewark777 From United States of America, joined Dec 2004, 9348 posts, RR: 29
Reply 24, posted (4 years 5 months 2 weeks 6 days 15 hours ago) and read 2514 times:

Quoting AGM100 (Reply 23):

With all of the information available now in my opinion it can be a double edge sword. When you can go online and instantly see that your BRK.B holdings have been downgraded to neutral , split and are falling ...it makes the hold a little tougher. But you are right , you have to keep perspective and remember why you bought the stock in the first place.

I've heard some financial advisors advise clients NOT to look at day to day performance of stocks for this very reason. People tend to have itchy trigger fingers.

But even then, let's say you have 30% of your portfolio in equity securities. Assuming you are properly diversified, even if Berkshire Hathaway goes bankrupt, you shouldn't lost more than 1% of the portfolio's total value.



Why grab a Heine when you can grab a Busch?
25 AGM100 : Its a natural reaction .... back to the old saying dont gamble what you dont mind losing.
26 Pellegrine : What does this have to do with anything? The JPY is still a world reserve currency. People run to Yen in the time of turmoil, not the way around. May
27 Post contains images AGM100 : US sending $45 Billion to the IMF ? ..... STOP. If the reports are currect the US gives 17% of the IMF total budget ... China gives 2.7 % . WSJ has r
28 Post contains links and images MadameConcorde : 05/06/2010 Wall Street falls sharply again. http://www.google.com/finance?client=ob&q=INDEXDJX:.DJI 10,474.53 -393.59 (-3.62%) DJ really went down
29 AeroWesty : This may be nothing other than a computerized reaction to a "fat finger" print for a trade on Proctor & Gamble. Same thing happened with Apple st
30 Post contains links and images MadameConcorde : Thank you. I found this on another forum. I wonder if this was manipulated to bring the DJ index down or if it was really an error. ???? Errant Trade
31 Post contains images AGM100 : Sure is ... lots of bad news leading the coverage on it. But I tend to believe that it was some kind of lag or event that triggered the sell off. I g
32 newark777 : Word is someone entered a $16 billion sell order instead of $16 million on equities futures contracts at the CME. Oops. Once the shares dropped, some
33 N328KF : Yup. It appears to be Citigroup. Also, Accenture's stock went from $42 down to $0.01 up to $41. Oh, to have been eyeing that stock at the right time!
34 AeroWesty : The NYSE CEO was just on CNBC and he's discounting the fat finger scenario. There'd been a "take a breather" for 60-90 seconds on a few stocks when el
35 Post contains links PSA53 : Here's more on that "trading error" http://finance.yahoo.com/news/Tradin...Major-Firm-cnbc-434682061.html?x=0
36 N328KF : Of course. The NYSE execs don't want to risk any chance of the US or French goverments (remember, NYSE is Franco-American now) adding regulation to a
37 ua777222 : Take a trip somewhere dark or far away. Tomorrow is going to be crazy.
38 AeroWesty : I don't see how that would be any advantage to the NYSE. They initiated the slowdown themselves, and other trading sources decided not to go along wi
39 Post contains links ua777222 : Priceless. I don't think its fair to call a time-out and then say "wow, that didn't work out, hit the undo button..."
40 Post contains links AeroWesty : When I looked at a simple time/price/volume chart for P&G (should have looked at this earlier), it doesn't look like a fat finger at all, but a si
41 Post contains images MadameConcorde : I have been thinking the same way although I think the Plunge Protection Team will be hard at work and any sharp drop will be corrected again some wa
42 newark777 : There were several stocks that fell to basically $0. I heard someone mention that they may void stocks above or below 60% of the pre-2:40 price. EDIT
43 AeroWesty : As a former broker, and still active investor, I wouldn't have a problem with that for the shares that traded at 1¢ (clearly anomalies), but the P&a
44 newark777 : I interned at a specialist firm back in college, and I can tell you, I am glad I was not there today, and I'm glad I didn't have to work late tonight
45 Post contains images RayChuang : Today's totally insane trading session (I felt like I just rode the Millenium Force roller coaster at Cedar Point amusement park! ) is more proof the
46 Post contains links and images MadameConcorde : Looks like the markets in the Far East are taking their turn. Wehre is their Plunge Portection Team? Asian markets tumble across the board By Justine
47 Post contains links MadameConcorde : Markets Overview * Dow -18.81 / -0.18% 10,501.51 * Nasdaq -17.85 / -0.77% 2,301.79 * S&P -3.04 / -0.27% 1,125.11 Stocks tumble anew May 07 10:39am
48 AGM100 : All this round and round .... here is the simple question . Who believes that the leftist policies of increased government control of our economy ...i
49 Post contains images ua777222 : ^ ^ ^ ^ ^ ^ ^
50 dxing : I have a hard time believing that on the surface. Jjust looking at 16 billion versus 16 million is pretty striking. 16 billion equals 16,000,000,000
51 newark777 : When you have to enter a 'b' vs. an 'm' on your terminal, it's not that striking.
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