Monday, September 29, 2008

These Dogs Aren't Barking

World Panic! 
Yet the bond futures and the notes futures are each trading below the high points they reached in March 2008. Gold is not only trading below its 1035 all time high reached earlier this year, but is still below the 925 rally top it put in a couple of weeks ago. Silver is down almost $9 from its mid-year high.
I think these are the early signs that the panic is about to end. These markets are all panic barometers, refuges in times of certainty. Given the current panic situation in world markets I would expect bond, notes, gold, and silver to be at new highs for 2008. But they are not. These dogs aren't barking.
Let's take a look at the stock market from this point of view. The first real panic headlines and magazine covers started to appear in mid-January of 2008.  You can view the chronology here on this link to my contrary opinion posts. At the moment the S&P is trading about 8% below its mid-January low. I find this remarkable. If you had told me then that the events we have seen during the intervening eight months would occur I would have predicted that the S&P  would be trading near 900 now.  But it isn't anywhere close. 
Again, that dog hasn't barked. I infer that much higher prices are in store (i.e. a move above the 1600 level) once these panic conditions pass.


Anonymous said...

so your low for the day is still 1160? or the 1165 print is all we'll get ... market seems to want to rally here ... maybe once the bill is passed we will start the rally.


Anonymous said...

Since June of last year your barking like a dog every week that the market was going to 1500. :))

Keith Shepard said...

Barking? Maybe they're making a sound that humans can't hear.


Anonymous said...

Shouldn't you wait for the results that are due soon...if as i fear they come around 50 for the SP...How could it justify a SP at 1600 ????


Anonymous said...

A stock I bought is run by a very smart manager. He realized 1.6 bil profit out of 8 bil notional CDS. He still have 12 bil notional outstanding. There were 64 trillion notional CDS out there. If (1.6/8)* 64, that is roughly CDS loss, 12.8 trillion out there. So 700 bil is nothing. The next wave will be failure in hedge fund and private equity, commerical real estate + world as European has 50% of these waste. So far, didn't hear bark from the other side of world

Anonymous said...

does contrarian mean predicting a bull market everyday--well i can clearly see 900--where is the catalyst--we may have a pop today but we will go under 1100 definitely this friday on jobless numbers. Money wont flow in unless there is a clear recovery(bottom)

Anonymous said...

After the House rejected the plan i dont think we will see 1600 print out, but instead may see 600 print out!!!

We can all sit up on this site and say we are heading to 1500 1600 1400 1200 when the market makes a lower low... blah blah blah

You have been so wrong in your predictions that is not funny anymore! You're a Goofball with you MBA and PHD's...

Anonymous said...

'I infer that much higher prices are in store (i.e. a move above the 1600 level) once these panic conditions pass.'

I doubt 1600 will be for the SP-more like $1600 for Gold in a few months