Aces High Bulletin Board
General Forums => The O' Club => Topic started by: DREDIOCK on July 07, 2005, 08:50:04 AM
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Im seeing predictions of the markets being down in responce to the latest terror attack in London. Some estimates are predicting the Dow dropping as much as 200 points.
Question is. Why so large? I can understand how the tourism industry might be effected but how does this translate to the rest of the market?
But even then wouldnt the wiser choice be simply to shrug it off?
Wish I had the money to invest right now because my instincts tell me that somewhere around 1:00 today would be a really good time to buy.
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My gut feeling says it will be down more than 200. I'm in it for long term, so I just shrug and continue on my investment ways.
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It will dip. The market is very susceptable to this type of thing. It doesn't mean anything for a long term investor. I predict it will rebound by next week at the latest.
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It dropped during the time when the DHS was seeing a lot of "terror traffic" and the country was on the spiffy red high alert.
Wall Street is like a jumpy cat on speed. Slightest thing happens and bam, its totally flipped out.
-SW
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Originally posted by Ripsnort
My gut feeling says it will be down more than 200. I'm in it for long term, so I just shrug and continue on my investment ways.
Probably. But it would seem to me that because of that now would be the time to buy, not sell.
I said 1:00 because I woudl think one would want to buy before it bottoms out.
What this drop really amounts to is pretty much simply a sale on these stocks.
I mean really. how many of these stocks are going to be perminently down because of this? I would guess none.
It just seems to me the market as a whole dropping because of news is silly and doesnt make any sence.
Would be much more prudent from a buisness standpoint to ignore it and carry on buisness as usual.
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Originally posted by Maverick
It will dip. The market is very susceptable to this type of thing. It doesn't mean anything for a long term investor. I predict it will rebound by next week at the latest.
Originally posted by AKS\/\/ulfe
It dropped during the time when the DHS was seeing a lot of "terror traffic" and the country was on the spiffy red high alert.
Wall Street is like a jumpy cat on speed. Slightest thing happens and bam, its totally flipped out.
-SW
Oh I agree.
Like I said I wish I had money to invest as right now I'd be getting ready to buy. Not sell
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as they make it when it goes up and when it goes down...
I think it'll end under 10k today and be back over 12k by Friday the 15th
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its a matter of getting your funds out before a potential crash and losing your shirt.. when everybody is thinking the same it causes chain reaction and sell off frenzy (which by basic economics will drive the cost of stocks/bonds down due to the amount of selloff on the market at a given time..) more supply = less cost of goods..
hence causing a loss of both volume and market prices for stocks across the board..
DoctorYo
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REason it is dropping is that the market is worried.
Will there be more war? Will oil prices go up even more? The economical climate isnt much better then pre 911, sure it aint droping but still not recovered, and will the economy sky dive like it did after 911?
That is the questions that worry investors and why people move money out of the stockmarket.
TEx
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Originally posted by DoctorYO
its a matter of getting your funds out before a potential crash and losing your shirt.. when everybody is thinking the same it causes chain reaction and sell off frenzy (which by basic economics will drive the cost of stocks/bonds down due to the amount of selloff on the market at a given time..) more supply = less cost of goods..
hence causing a loss of both volume and market prices for stocks across the board..
DoctorYo
But you only loose your shirt if the buisnesses are no longer in buisness yes?
If your patient and wait it out the stock goes up and leaves you none the worse for wear yes?
9/11 I can understand because entire buisnesses ceased to exist as a result of the attacks.
But an attack like this it would seem to me would only have a short term effect on most if not all buisnesses effected.
While on a personal level the attacks inn London was a very terrible thing. From a buisness standpoint I dont see how it is anything more then a speedbump.
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Originally posted by TexMurphy
REason it is dropping is that the market is worried.
Will there be more war? Will oil prices go up even more? The economical climate isnt much better then pre 911, sure it aint droping but still not recovered, and will the economy sky dive like it did after 911?
That is the questions that worry investors and why people move money out of the stockmarket.
TEx
Actually I am of the opinion that the economy or. the market in particular is in better shape then pre 9/11. Its more stable neither rising nor dropping sharply for more then a day or so. There is no "bubble" other then possibly in the housing market to worry about.
I'd be more worried if we were in a runaway economy of the 90's or the sharp downturn of 2000. Remember the economy was already in a skydive just prior to 9/11 and those atacks made it worse. In this case we are far more stable IMO.
I think if 9/11 were to have happened now rather then when it did we would be in far better shape to handle it. then in 2000 or even in the 90s
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Since there are gaming sims for just about everything else.
anyone know of one for the stock market?
Might be fun to test some of my thoughts just to see how they would do if I had the money to do so. LOL
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Originally posted by DREDIOCK
Since there are gaming sims for just about everything else.
anyone know of one for the stock market?
Might be fun to test some of my thoughts just to see how they would do if I had the money to do so. LOL
This one is free and can be very educational
http://simulator.investopedia.com/
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It's just more stupidity and foolishness on the part of a certain element of people who really have no business in investments.
It is no different than the idiots who panic and drive up the price of oil when a sailor farts on a supertanker. With oil, you have a certain group that makes their money by buying oil futures right up until the moment before the prices on those delivery futures peak, and then selling them to the idiots trying to get in on the profits, right when the price peaks. All it REALLY does is slightly stunt growth for a while. Over all, and over time, it hurts the economy slightly. Eventually, a bunch of the morons who bought when the futures peaked will lose their prettythang when the deliveries arrive and the futures prices don't hold.
With attacks like this it is different, but only slightly. The market is flooded with panicky uneducated investors. They scream to their "broker" SELL, SELL every time there is any sort of a hiccup.
The assumption that the stupidity creates nothing other than some miserable people, and some good buys on stocks for people with common sense who invest for the long term, is absolutely correct. Indeed, those stocks are on sale for a few days, and sharp investors will quietly snatch them up, just as they have every other time.
Even after the Depression and the Crash, the market recovered, as it always has, and always will. It averages a 12% return on every ten year period since at least the turn of the century.
The ONLY businesses something like this MIGHT sink are businesses on their last legs to begin with. A healthy business will weather this attack just as it did the attacks on Madrid, and the attacks on 11 September 2001.
I'm like you Dred, I wish I had a few thousand $$$ on hand to buy with.
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I was putting a percentage of my income into savings, but I have cut that back and put part into investments. So far in the almost 2 years we have been investing we have done well.
Investing my rate of return is around 20 percent while my savings is only 2.25 percent. We invest for the long haul and look for stocks that pay decent dividends.
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Exactly. "Savings" in most forms like savings accounts and CD's rarely even keep up with inflation. Good investments however, continue to average at least 12% over the long haul. Even if you factor in inflation at an average of 3%, and risk factors at around 2% (provided you are a wise common sense investor) that's a true yield of around 7% compounded over time. It USUALLY works out to between 9 and 10%, but 7% is a SAFE estimate.
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But you only loose your shirt if the buisnesses are no longer in buisness yes?
If your patient and wait it out the stock goes up and leaves you none the worse for wear yes?
9/11 I can understand because entire buisnesses ceased to exist as a result of the attacks.
But an attack like this it would seem to me would only have a short term effect on most if not all buisnesses effected.
While on a personal level the attacks inn London was a very terrible thing. From a buisness standpoint I dont see how it is anything more then a speedbump.
you are correct what you are describing are investors..(investors are in for the long haul..) What a large amount of the volitility is from are traders...
Merril, Templeton, Fidelity, etc.. These houses trade massive shares of everthing on a daily basis.
They control the market... When you buy stock you most likely buy it from them directly as they and the market set the price... (they buy so many shares directly from company then resell them to you..)
the effects of the market should be short term due to this attack but with another attack you could have a complete lack of investor confidence (like after 2001 or even before it when Dot.bomb happened) then you have a massive selloff aka a stock market crash..
lets hope that doesn't happen..
DoctorYo
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The BBC on the economic impact (http://news.bbc.co.uk/1/hi/business/4660227.stm)
It looks to be a minor blip, but I might buy a few shares of BP to show support.
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Originally posted by DREDIOCK
But you only loose your shirt if the buisnesses are no longer in buisness yes?
You loose your shirt when you sell lower than you buy.
Originally posted by DREDIOCK
If your patient and wait it out the stock goes up and leaves you none the worse for wear yes?
Yes.
Unless… the price goes down and doesn’t comes back up. Or at least doesn’t come back up before you have to sell. It’s fear of “unless” that gets a lot of people.
But you’re right that over the long run, you’re usually better not to try to time your buys and sells.
Of course many people ignore this advice. Bad news comes out, the market goes down and they sell (at a low price). Good news comes out, the market goes up and they buy (at a high price). This is called getting whipsawed.
Wall street is waist deep in whipsaw dust.
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Actualy several bombs has been placed around London financial district.
It might affect the market, when thousands of british dont work... ummm ?
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Originally posted by Eagler
as they make it when it goes up and when it goes down...
I think it'll end under 10k today and be back over 12k by Friday the 15th
very glad I was wrong:
This sends a message (http://finance.yahoo.com/q?d=t&s=^DJI)
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Ha! Finishes +20! I couldn't have been more wrong!
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Originally posted by Eagler
as they make it when it goes up and when it goes down...
I think it'll end under 10k today and be back over 12k by Friday the 15th
I'd be quite surprized if it fluctuated that much. London, like New York, is one of thr three big financial centers but the damage was much less. Much, much less.
It'll dip a bit, but then recover.
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Originally posted by Ripsnort
Ha! Finishes +20! I couldn't have been more wrong!
Just curious as to what time it was it went from - to +
I said my gut feeling was that around 1:00 was gonna be the time to buy.
anyone know how close I was?
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Originally posted by DREDIOCK
Just curious as to what time it was it went from - to +
I said my gut feeling was that around 1:00 was gonna be the time to buy.
anyone know how close I was?
Very close.
http://finance.yahoo.com/q/bc?s=%5EDJI&t=1d
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Originally posted by Ripsnort
Very close.
http://finance.yahoo.com/q/bc?s=%5EDJI&t=1d
Not bad. Looks like I was off by about an hour and a half
Not bad considering Im mostly self educated about the market.
course if I ever got into it for real I'd probably loose my shirt lol