What's up with the current volatility in US stock market? 2015 has been ruff, worst year since 2008, stocks plunge first week 2016, market back to Aug 24 plunge

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    Dec 18, 2015 10:05 PM GMT
    Why so volatile in 2015? I try and track stock market results per year, not day to day. There doesn't seem to be much of a recovery since the last week of August 2015. (3rd and 4th quarter dumps). The market has only recovered half of what it lost this year, and there has been no gain since the market hit highs in the 2nd quarter

    The Dow dropped over 2,500 points this year, but not all at once (so it didn't cause a panic, its been gradual). I don't understand this much volatility in a slowly, recovering economy. The only news is low oil prices which hit $34.50 a barrel on 12 18 2015. If we are transitioning off of foreign oil and more on to domestic, why is the US stock market reacting as if this is a bad thing? Also moving towards alternative energy has produced over abundance

    If this low oil price with its high inventory, price gets any lower, is oil going to cause more of this US market craziness? 2016 is very difficult to predict at this point. The US market is still way off its highs earlier this year.

    Lower oil prices means lower grocery prices? I haven't seen it


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    On Aug 25 2015, the Dow (15,666) and S&P 500 (1,867) reached an all time low off their highs On July 17 2015 S&P 500 (2,126) and on May 15 2015 Dow (18,272)

    Total Difference high to low

    Dow: <- 2,606 points
    S&P: <- 259 points


    From high to current close today, 12 18 2015

    Dow: <- 1,144 points
    S&P: <- 121 points



    Stocks End the Week With a Skid
    http://www.wsj.com/articles/global-stocks-slip-as-commodity-price-worries-return-1450430668


    U.S. stocks extended their losses Friday, as a rally spurred by the Federal Reserve’s decision to raise interest rates faded and oil prices slid.

    The Dow Jones Industrial Average dropped 327 points, or 1.9%, to 17169. The S&P 500 declined 1.5%, and the Nasdaq Composite dropped 1.4%.


    Dow drops more than 350, stocks lower for week as oil slides
    http://www.cnbc.com/2015/12/18/


    Oil price crash could get even worse in 2016
    http://money.cnn.com/2015/12/18/investing/oil-prices-2016-opec/


    Goldman thinks oil could drop to $20


    Cheap oil has caused U.S. output to decline from its April 2015 peak -- but not by enough to reduce the global glut, yet.

    In fact, the oversupply problem had gotten so bad that there was a "traffic jam" of oil tankers waiting to be offloaded off the U.S. Gulf Coast in November because there was nowhere to put the crude.


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    Dec 18, 2015 10:37 PM GMT
    It's because I rolled one of my pitiful retirement funds into the market vicon_rolleyes.gif

    Every time it creeps up to breaking even, there is another sudden, inexplicable crash.

    Argh. Apple won't even let you delete the "stocks" app from your phone. I need to stick it in a sub-folder where I won't see it. icon_confused.gif
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    Dec 18, 2015 11:30 PM GMT
    ELNathB saidWhy so volatile in 2015? I try and track stock market results per year, not day to day. There doesn't seem to be much of a recovery since the last week of August 2015. (3rd and 4th quarter dumps). The market has only recovered half of what it lost this year, and there has been no gain since the market hit highs in the 2nd quarter

    The Dow dropped over 2,500 points this year, but not all at once (so it didn't cause a panic, its been gradual). I don't understand this much volatility in a slowly, recovering economy. The only news is low oil prices which hit $34.50 a barrel on 12 18 2015. If we are transitioning off of foreign oil and more on to domestic, why is the US stock market reacting as if this is a bad thing? Also moving towards alternative energy has produced over abundance

    If this low oil price with its high inventory, price gets any lower, is oil going to cause more of this US market craziness? 2016 is very difficult to predict at this point. The US market is still way off its highs earlier this year.

    Lower oil prices means lower grocery prices? I haven't seen it


    icon_confused.gif




    On Aug 25 2015, the Dow (15,666) and S&P 500 (1,867) reached an all time low off their highs On July 17 2015 S&P 500 (2,126) and on May 15 2015 Dow (18,272)

    Total Difference high to low

    Dow: <- 2,606 points
    S&P: <- 259 points


    From high to current close today, 12 18 2015

    Dow: <- 1,144 points
    S&P: <- 121 points



    Stocks End the Week With a Skid
    http://www.wsj.com/articles/global-stocks-slip-as-commodity-price-worries-return-1450430668


    U.S. stocks extended their losses Friday, as a rally spurred by the Federal Reserve’s decision to raise interest rates faded and oil prices slid.

    The Dow Jones Industrial Average dropped 327 points, or 1.9%, to 17169. The S&P 500 declined 1.5%, and the Nasdaq Composite dropped 1.4%.


    Dow drops more than 350, stocks lower for week as oil slides
    http://www.cnbc.com/2015/12/18/


    Oil price crash could get even worse in 2016
    http://money.cnn.com/2015/12/18/investing/oil-prices-2016-opec/


    Goldman thinks oil could drop to $20


    Cheap oil has caused U.S. output to decline from its April 2015 peak -- but not by enough to reduce the global glut, yet.

    In fact, the oversupply problem had gotten so bad that there was a "traffic jam" of oil tankers waiting to be offloaded off the U.S. Gulf Coast in November because there was nowhere to put the crude.




    "The only news is low oil prices which hit $34.50 a barrel on 12 18 2015. If we are transitioning off of foreign oil and more on to domestic, why is the US stock market reacting as if this is a bad thing?"

    I don't understand. I can't think of a better way to get more disposable income into the hands of consumers than this sharp reduction in gas prices.

  • rnch

    Posts: 11524

    Dec 18, 2015 11:53 PM GMT
    Marker goes up...market goes down...market goes up...market goes down...




    icon_rolleyes.gif




    My TSP (government 401-K plan), heavily leveraged into the "C Fund" (Common Stock Fund) did well this year; lucrative enough to propel me into #EarlyRetirement.


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    Dec 19, 2015 1:51 AM GMT
    mindgarden saidIt's because I rolled one of my pitiful retirement funds into the market vicon_rolleyes.gif

    Every time it creeps up to breaking even, there is another sudden, inexplicable crash.

    Argh. Apple won't even let you delete the "stocks" app from your phone. I need to stick it in a sub-folder where I won't see it. icon_confused.gif






    Yes, as example, the market reacted very positive on the Fed announcement and was up about 200 points the other day. A few days later, the market loses all of that gain and then some instead of building upon the already favorable news, WTF icon_question.gif ?


    Finally! Fed raises interest rates
    http://money.cnn.com/2015/12/16/news/economy/federal-reserve-interest-rate-hike/

    America's first interest rate hike in nearly a decade is here.
    The Federal Reserve raised its key interest rate on Wednesday from a range of 0% to 0.25% to a range of 0.25% to 0.5%.

    Stocks rallied with the Dow rising 224 points after the announcement and Yellen's press conference.

    Investors were pleased to see that the Fed expects "only gradual increases" in rates next year and that the committee explicitly said it would take into account "readings on financial and international developments."
  • tj85016

    Posts: 4123

    Dec 19, 2015 3:34 AM GMT
    oil and commodities tanked

    Europe, Brazil, Japan, South Africa, China (I don't care what their fake numbers say) in recession (Canada and Australia are next)

    currencies in turmoil

    stocks are grossly over-valued
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    Dec 19, 2015 3:39 AM GMT
    Jim Cramer needs to be taken out back by the wood shed. icon_twisted.gif
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    Dec 19, 2015 5:01 AM GMT
    bon_pan saidJim Cramer needs to be taken out back by the wood shed. icon_twisted.gif

    Has he led you astray?
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    Dec 19, 2015 5:10 AM GMT
    ELNathB said The only news is low oil prices which hit $34.50 a barrel on 12 18 2015. If we are transitioning off of foreign oil and more on to domestic, why is the US stock market reacting as if this is a bad thing?


    No rational reason - it just does. The stock market is not a person, so you cannot expect movements to be "rational." So it seems that when oil goes down, companies that consume oil should become more valuable, because they have to spend less to buy it. They probably are, it's just that their stock prices are not reflecting that. Doesn't mean that they won't someday - but who knows when?
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    Dec 19, 2015 5:26 AM GMT
    tj85016 saidoil and commodities tanked

    Europe, Brazil, Japan, South Africa, China (I don't care what their fake numbers say) in recession (Canada and Australia are next)

    currencies in turmoil

    stocks are grossly over-valued





    I don't think stocks in general are grossly over-valued at all but I think some sectors, such as defense, are extremely over-valued. (I am sure on purpose). Those of us that were in the market during the great stock market plunge of the lead into the housing crash, remember it quite well.

    Some of us "saw it coming", I do remember when the Dow was around 11,000, early in 2008, I moved all my money out of stocks, into safe bonds and watched the numbers plummet the entire year. When it finally showed signs of rebounding, I put all my money back into stocks and road the wave back up. Scary shit if you were not paying attention

    This is how most people, usually the elderly, lost a lot of their life savings. They just didn't see this like most, a lot of people panicked when the market got too low and sold. They should have just moved their money like I did, instead of selling at such a low end of the market

    It was hell for everyone at that time who wasn't paying attention. I feel very bad for those who lost everything



    United States bear market of 2007–09
    [url]https://en.wikipedia.org/wiki/United_States_bear_market_of_2007%E2%80%9309[/url]


    The US bear market 2007–2009 was declared in June 2008 when the Dow Jones Industrial Average (DJIA) had fallen 20% from its October 11, 2007 high.[1][2][3][4][5] This followed the United States bull market of 2002–07 and was followed by the United States bull market of 2009–present.

    The DJIA, a price-weighted average (adjusted for splits and dividends) of 30 large companies on the New York Stock Exchange, peaked on October 9, 2007 with a closing price of 14,164.53. On October 11, 2007, the DJIA hit an intra-day peak of 14,198.10 before starting its decline.

    The decline of 20% by mid-2008 was in tandem with other stock markets across the globe. On September 29, 2008, the DJIA had a record-breaking drop of 777.68 with a close at 10,365.45. The DJIA hit a market low of 6,443.27 on March 6, 2009, having lost over 54% of its value since the October 9, 2007 high.[6] The bear market reversed course on March 9, 2009, as the DJIA rebounded more than 20% from its low to 7924.56 after a mere three weeks of gains.[7] After March 9, the S&P 500 was up 30% by mid May and over 60% by the end of the year.

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    Dec 19, 2015 6:07 AM GMT
    HikerSkier said
    ELNathB said The only news is low oil prices which hit $34.50 a barrel on 12 18 2015. If we are transitioning off of foreign oil and more on to domestic, why is the US stock market reacting as if this is a bad thing?


    No rational reason - it just does. The stock market is not a person, so you cannot expect movements to be "rational." So it seems that when oil goes down, companies that consume oil should become more valuable, because they have to spend less to buy it. They probably are, it's just that their stock prices are not reflecting that. Doesn't mean that they won't someday - but who knows when?






    Some economists blamed high oil prices for the recession of 2008, which they were quite high. But as we know now, it was the housing bubble and banks. I think its a matter of "buying bulk".

    Say whoever is buying crude oil to refine and the set price per barrel is $100. In order to get a "cheaper price", the buyer buys the oil in "bulk" at high volume instead of per barrel at a lower volume. If you use up your high volume, refine and sell all your oil you bought for say $80, because you bought in bulk and you need more, but the price is now $110 per barrel, you are going to pay more for the 2nd batch of high volume bulk than you did for the first batch.

    I think what's happening with oil now is that everyone bought in high volume bulk the last year but didn't anticipate the price going so low and everyone has all this left over oil that has not been refined or sold. So if the saying goes about supply and demand, they over bought all this oil, probably at the higher price they paid a year ago and now they are stuck. The supply now outweighs the demand, which is extremely rare. They will never make a profit if they have to sell their bulk oil for less than they paid for it.

    The question is what caused the price to fall too low? Supply outweighs the demand? US oil production outweighs middle east? Alternative energy outweighs the normal?

    Buying in bulk is good, sometimes. Sams Club, Costco, Smart & Final and Aldi all know to well. But these only work if say you have a big family to buy for or run an establishment that requires supplies from these bulk stores. We all know its cheaper to buy in bulk but that has to justify itself. It has worked for oil, up until now.


  • rnch

    Posts: 11524

    Dec 19, 2015 6:58 AM GMT
    Some of you guys worry wayyyyyyy too much. Just find a stock market mixed mutual fund, invest regularly, periodically in it and "Let It Ride".

    I did for almost 30 years, did quite well with it.


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    Dec 19, 2015 1:47 PM GMT
    tj85016 saidoil and commodities tanked

    Europe, Brazil, Japan, South Africa, China (I don't care what their fake numbers say) in recession (Canada and Australia are next)

    currencies in turmoil

    stocks are grossly over-valued


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    Dec 19, 2015 11:49 PM GMT
    ELNathB said
    HikerSkier said
    ELNathB said The only news is low oil prices which hit $34.50 a barrel on 12 18 2015. If we are transitioning off of foreign oil and more on to domestic, why is the US stock market reacting as if this is a bad thing?


    No rational reason - it just does. The stock market is not a person, so you cannot expect movements to be "rational." So it seems that when oil goes down, companies that consume oil should become more valuable, because they have to spend less to buy it. They probably are, it's just that their stock prices are not reflecting that. Doesn't mean that they won't someday - but who knows when?



    The question is what caused the price to fall too low? Supply outweighs the demand? US oil production outweighs middle east? Alternative energy outweighs the normal?


    You said it - almost no demand (most of the world in recession) and Saudis are pumping like there's no tomorrow, hoping to bring the price down to a point below that at which American producers can make a profit, and both the Russians and Saudis are producing all they can because they need the income.
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    Dec 31, 2015 7:52 PM GMT
    See, it just wasn't me that noticed.....



    Dow closes in on worst year since 2008
    http://money.cnn.com/2015/12/31/investing/stocks-market-end-of-2015/

    The new year can't come soon enough for many investors.

    By midday Thursday, the Dow was down 1.9% or 125 points, heading for its worst finish since the market collapsed in 2008.

    The S&P 500 was virtually flat for the year, while the Nasdaq is finishing 2015 with solid gains.


    It was a good year for investors on opposite sides of the spectrum. Investors who put extra cash on the sidelines avoided all the negative returns in stocks and bonds. Bank of America declared that "cash is king" in 2015 in a research note from September.


    Dow on Track for Loss in 2015

    Shares in U.S., Europe and Asia decline modestly on final trading day of the year
    http://www.wsj.com/articles/global-stocks-set-to-close-year-with-a-whimper-1451552749

    Stocks around the world fell on the last day of the year, as the Dow industrials headed for their first annual drop since 2008.

    An extended slump in commodity prices and concerns over global growth damped a yearslong stock rally this year, factors that many investors don’t expect to go away in 2016.

    “I see more headwinds than I do favorable factors” next year, said Keith Bliss, senior vice president at brokerage Cuttone & Co.

    “We haven’t seen a massive end-of-year rally, which is probably not a good sign” for the start of next year, said Philippe Gijsels, chief strategist at BNP Paribas Fortis.

    Here are some year-to-date figures:
    The Dow is down 1.2%.
    The Dow posted its last annual decline in 2008, when it fell 34%.
    The S&P 500 is up 0.1%, with six of its 10 sectors down this year.
    The energy sector is the biggest decliner in the S&P 500, falling 24%.
    The consumer discretionary sector has risen 9.1%, making it the biggest gainer in the S&P 500.
    U.S. crude oil futures have fallen 30%.
    The Bloomberg Commodity index is down 25%.
    Netflix is the biggest percentage gainer of the year in the S&P 500; Chesapeake Energy is the biggest decliner.
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    Jan 04, 2016 8:51 PM GMT
    Happy New Year! Panic on the first day, WTF? icon_twisted.gif


    Dow plunges triple digits, having worst opening day in 84 years
    http://finance.yahoo.com/news/nasdaq-falls-2-dow-plunges-143629728.html

    U.S. stocks traded sharply lower Monday, the first day of trade for the year, weighed by renewed concerns of global economic slowdown and increased tensions in the Middle East. The overnight drop in Chinese stocks that triggered a circuit breaker also pressured sentiment.

    Anytime a big market stops trading and it spills over to Europe, investors are nervous," said Marc Chaikin, CEO of Chaikin Analytics.

    "Ex-China we were expecting a positive (market). At the end of the day, except for a few companies like Caterpillar, this really shouldn't have an impact on our markets," he said.

    The Dow Jones industrial average traded about 300 points lower. Earlier, the index fell more than 450 points, down more than 2.5 percent, on pace for its largest percent decline on the first trading day of the year since 1932

    "Anytime a big market stops trading and it spills over to Europe, investors are nervous," said Marc Chaikin, CEO of Chaikin Analytics.

    The Dow Jones industrial average traded about 360 points lower, down more than 2 percent, on pace for its largest percent decline on the first trading day of the year since 1932. Earlier, the index fell more than 450 points, down more than 2.5 percent.

    The Dow attempted to hold above the psychologically key 17,000 level after falling below in intraday trade for the first time since October.

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    Jan 04, 2016 11:23 PM GMT
    ^ ElNath
    Suggest you start following the S&P instead of the Dow. Although the 2 indexes (indices if one is a grammar nazi) often move in tandem, no one on Wall Street, nor any serious investor, attaches any significance to the Dow (a limited price-weighted index). It is only reported for popular consumption.

    The S&P (a market cap weighted index of the largest 500 companies) closed at 2012 - it was down 2.6% at midday, but down only 1.5% at today's close.
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    Jan 05, 2016 4:43 AM GMT
    HikerSkier said^ ElNath
    Suggest you start following the S&P instead of the Dow. Although the 2 indexes (indices if one is a grammar nazi) often move in tandem, no one on Wall Street, nor any serious investor, attaches any significance to the Dow (a limited price-weighted index). It is only reported for popular consumption.

    The S&P (a market cap weighted index of the largest 500 companies) closed at 2012 - it was down 2.6% at midday, but down only 1.5% at today's close.




    I realize that, but the market (which includes S&P) has not recovered from the day it plunged 2015, the date mentioned in the above posts (Aug 24) and the article about it, below. Five months now without a recovery. And by recovery, I mean reaching the high point again at some point within the last five months.

    If you understand averaging, you know an average means some days above the mean and some days below the mean creates an average mean, while the 'normal trend' of the mean is it slowly creeps upward. The last five months the mean average has slowly or in some cases, violently, crept the opposite direction, downward. Except for paying dividends, everyone lost money who was in the market after Aug 24

    The lack of upward, normal movement of the mean average means there could be a serious problem, or serious manipulation. My figures above already have the market in a "correction", meaning the average mean has 'reset' some 5% lower where the old average mean was, just five months ago

    Being an US election year and continuous chaos in the middle east, (especially now with Saudi and Iran on the brink of civil war and a complete collapse of oil prices). I am trying to decide to pull out of the market for 2016 and just take my losses from the Aug 24 2015, unexplained (China) panic that has now, apparently taken hold in 2016 (blaming China a second time icon_confused.gif )


    After historic 1,000-point plunge, Dow dives 588 points at close August 25, 2015
    http://money.cnn.com/2015/08/24/investing/stocks-markets-selloff-china-crash-dow/

    After an unprecedented 1,000-point decline at the open on Monday, the Dow closed with a loss of nearly 600 points.

    It was an extremely turbulent day for U.S. stocks driven by deep fears about China's economic slowdown. Stocks staged a comeback that nearly brought the Dow back into positive territory but that ultimately failed.


  • Apparition

    Posts: 3529

    Jan 05, 2016 5:40 AM GMT
    demographics.

    old people buy less consumer crap.
    everyone is getting older.

    wait til the "im too old to live in this big place, and also I need to cash in stocks for income funds" hits all at once when everyone is a seller. (luckily a few rich people own a huge chunk of the market, much more than people expect, so the Im too old effect will be somewhat less than it could be.)

    inequality-perceptions.png
  • tj85016

    Posts: 4123

    Jan 05, 2016 2:41 PM GMT
    don't worry, it's no longer a "market" but a manipulated government/central bank controlled mess anyway

    the Fed front-loaded the entire fake rally, now it's sort of impotent
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    Jan 07, 2016 6:31 PM GMT

    Blaming China, again, for the New Year plunge, US markets are now approaching the all time low date, Aug 24, 2015 icon_rolleyes.gif



    China's stock market is a clown show
    http://www.latimes.com/business/hiltzik/la-fi-mh-a-reminder-china-s-stock-market-is-a-clown-show-20160107-column.html


    Just as "bad cases make bad law," to cite the ancient legal adage, bad stock markets make for bad investment decisions. China's stock market, with its repeated crashes, has the entire world in a tizzy.

    The Shanghai stock exchange experienced its shortest trading day ever on Wednesday, as circuit breakers designed to end trading if the market slid 7% kicked in after only 14 minutes of active trading. As my colleague Julie Makinen reports, Shanghai Composite has dropped about 12% this year, and the Shenzhen composite has fallen more than 15%.


    The world should take a deep breath. The China stock market meets the definition of a bad stock market.

    The market is the target of relentless intervention by the Chinese government, which has been setting investment rules and tweaking them without any evident understanding of how open markets work. Adding to the chaos, the market was inflated by an inflow of small investors buying on huge margins — a notoriously skittish class of investors buying under conditions that made them especially vulnerable to the market's volatile swings.

    Last April, as Evan Osnos of the New Yorker reported, the official organ of the Chinese Communist Party exhorted citizens to plunge into the market. An upsurge of more than 80% in four months was "merely the start of a bull market." Investors should take heart from the government's determination to keep Chinese companies strong.

    "Over the next two and a half months, investors opened thirty-eight million new stock accounts, more than quadruple the number of accounts opened in all of 2014," Osnos wrote. "Retail exchanges, equipped with audience seating, attracted retirees and other small-time investors who spent hours scanning the digital displays, like visitors to the dog track."

    The circuit breakers are another source of trouble. Introduced Jan. 4, the rules halt trading for 15 minutes after a 5% drop in the benchmark CSI 300 index, and stop trading for the rest of the day when the index falls 7%. They were triggered on day one, and again on Wednesday.

    Circuit breakers exist in U.S. markets, but critics say they're cinched too tight in China, where 5% swings have been far more common. In the U.S., trading is shut down only if the Standard & Poor's 500 benchmark falls 20% in a day.


  • tj85016

    Posts: 4123

    Jan 07, 2016 9:18 PM GMT
    I told you guys 6+ months ago that this was gonna happen when copper, iron ore, rail car traffic, CAT world-wide sales, and shipping container prices tanked

    now the fake Obama/Fed bubble is going bust
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    Jan 07, 2016 11:27 PM GMT
    tj85016 said... now the fake Obama/Fed bubble is going bust
    how bad do you think its going to geticon_eek.gif
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    Jan 07, 2016 11:32 PM GMT
    tj85016 saidI told you guys 6+ months ago that this was gonna happen when copper, iron ore, rail car traffic, CAT world-wide sales, and shipping container prices tanked

    now the fake Obama/Fed bubble is going bust


    That sounds a bit odd - what "bubble" is this of which you speak?
  • tj85016

    Posts: 4123

    Jan 07, 2016 11:37 PM GMT
    HikerSkier said
    tj85016 saidI told you guys 6+ months ago that this was gonna happen when copper, iron ore, rail car traffic, CAT world-wide sales, and shipping container prices tanked

    now the fake Obama/Fed bubble is going bust


    That sounds a bit odd - what "bubble" is this of which you speak?


    most stocks (banks, tech, retail), treasuries, junk, car loans, student loans (all Fed driven)

    big money real estate (bubble also) in London and Paris will get wacked (mostly due to the Chinese and Russians), but I think New York, San Francisco and Boston will decline much less