Category Archives: The Bubble

I am not encouraging people to buy in the stock market

So was the message of the White House in their latest gambit to instill confidence.   President Obama noted that eventually the stocks would become a good deal.   That statement alone seems to have given a small boost to the world markets so the White House had to clarify it.  Indeed, I would add some stocks are a good deal. As  much as I hate to agree with the down in the mouth crew at the White House, I do.  In my humble estimation the market could go down to a Dow Jones Industrial Average 5000.  If it breaks the technical level of around 6700,  watch out.  I am not a market expert and quit listening to experts two years ago when it appeared they were either on the take or in a dream world, but given traditional evaluations of price to earnings for the S&P 500, the Dow could be at 6000 and based on earning projections, it has been calculated at 4900.  That means the market Read more

What Is the Deal?

The Fed has decided to avoid allowing the uncertainty in the market to devolve into a financial panic. It is has fired the executives of the federal mortgage companies Fannie Mae and Fannie Mac. Their failure would have pulled the entire world into recession and the U. S. into economic turmoil. The executives who lost their jobs didn't fare too poorly. One had the board insert into his contract last July after it was known they would need a government bailout, a nice departure clause. The bottom line is while taxpayers are at risk, pensioners have lost, and banks are undermined directly as a result of his mismanagement, he gets an extra bonus. What a deal! Here a quote the NYTimes aticle. But even after the government seized the mortgage finance companies on Sunday and dismissed their chief executives, the companies’ outgoing leaders could see big paydays — a prospect that Read more