Thursday, March 26, 2009
Dow: Is it safe yet?
Dow hits 6-week high on relief over earnings
Do we have a market bottom at 6,440? The Dow Industrials are up 21% since that March 9 low.
TigerHawk blogged on March 5 that he bought in around that level. Party at his house, date TBD.
2 Comments:
By 
D.E. Cloutier, at
Thu Mar 26, 11:17:00 PM:
Meanwhile, from Voice of America today:
"Legendary hedge fund investor George Soros said Thursday that US commercial real estate prices will fall 30 percent, a development that he says shows that the financial crisis is continuing.
"Soros told a Washington forum that it is inevitable that commercial property prices in the United States will fall drastically. The 78-year-old investor said the price declines will come shortly. Other experts, including analyst Christopher Whalen, agree, saying the demand for commercial property is falling rapidly while overbuilding has created a huge surplus of supply.
"Separately, Nomura Securities chief economist Richard Koo says US residential property prices need to fall a further 20 percent in order to bring rental and purchase price ratios back into normal balance. Average home prices have fallen 20 percent in the past two years. Koo believes the rush to pay down debt incurred during the boom years is holding back consumer spending, insuring that the US economy will remain in recession at least another year."
In response to your question about the Dow, Escort81, I couldn't tell you. Like Gordon Gekko, I only bet on sure things.
P.S. Here is the VOA link:
http://www.voanews.com/english/2009-03-26-voa71.cfm
By 
, at
Fri Mar 27, 09:38:00 AM:
From Link:
Bloomberg News picked up George Soros' comments. Not an original observation, that commercial real estate will get pounded. But it does worry me that banks still have this exposure going into the upcoming hustle of Obama's stress tests. I imagine Soros already has his short positions staked out. George came out of retirement to make $1.1B last year ... I bet he does even better in 2009. In his own words "I'm having a very good crisis ... 'It is, in a way, the culminating point of my life’s work' As I'm sure you know, George was a big backer of Obama and the global warming hysterics.
Soros had a few other other interesting comments:
Soros, 78, said the risk of further declines in property prices is reason for the administration of President Barack Obama to move quickly to recapitalize banks. Soros said Obama acted too slowly on a banking overhaul and should have moved immediately upon taking office. “At that moment of enthusiasm, fresh out of the gate, he would have gotten that money, and then we could have recapitalized the banks the right way" [No sh*t!]
Soros also said that the U.S. may face a new round of inflation should the flow of credit recover because of the large increase in the money supply stemming from the Federal Reserve’s purchases of Treasury securities.
“In order to make up for the collapse of credit, we are effectively creating money,” Soros said. “If and when credit is restarted, you would then have an incredibly swollen monetary base, which, if it were leveraged, you would have an explosion of inflation.”
“Right now we are in a period of deflation, but it could easily tip over, where you are facing inflation,” Soros said. “You are then faced with the prospect of draining money supply as fast as credit is created.”
Too much money chasing overvalued assets ... developing
