Sharp sell-off in US stocks is the start of a 'very major correction'

Discussion in 'Latest US & World News' started by HumbledPi, Oct 10, 2018.

  1. HumbledPi

    HumbledPi Active Member

    Joined:
    Aug 31, 2018
    Messages:
    279
    Likes Received:
    124
    Trophy Points:
    43
    https://www.cnbc.com/2018/06/19/jim...f-in-us-stocks-start-of-major-correction.html

    Today, the stock market had one of it's biggest selloffs since last February. The Dow Jones finished at -817.22 or 3.09% and the NASDAQ -315.97 or 4.08% of total market value.

    The selloff came on fears of rising interest rates. In the past year with a robust economy and a stock market rising to record levels, Trump took the credit for it - saying that it's a function of his policies. Will he take the blame for the severe losses on Wall Street today? I don't think so.

    Everyone knew that a huge bubble in the economy was forming and it would burst sooner or later.

    "The trade war worries are "certainly having an effect on the market, but the market is reacting because it's already far too expensive," Mellon said. "The U.S. is selling at 32 times cyclically adjusted price-to-earnings (PE) ratio, which is an all-time high. Surely it's time for a major correction anyway."

    Mellon is not alone in suggesting that today's stock market is the most overvalued on record — more so than in 1929, 2000 and 2007.
     
  2. fullmetaljack

    fullmetaljack Active Member

    Joined:
    Oct 24, 2017
    Messages:
    346
    Likes Received:
    194
    Trophy Points:
    43
    Gender:
    Male
    The Republicans and Dirty Donald will try to blame the Democrats for this and the Democrats will use this at mid-terms, in a month, to show what an ignorant amateur Dirty Donald is when it comes to economics.
     
    JakeStarkey, Mandelus and HumbledPi like this.
  3. Kathie Harine

    Kathie Harine Member

    Joined:
    Mar 20, 2018
    Messages:
    63
    Likes Received:
    40
    Trophy Points:
    18
    Gender:
    Female
    The entire bull market starting in 2009 has been a Wall Street crack party fed by interest rates near zero. Corporations and financial institutions have done nothing but borrow billions to bet on the markets and buy back their own stock. Very few jobs were created that had any substance. Only low-wage, no-benefit jobs were created. Obama should have demanded a large infrastructure program from Congress before bailing out Wall Street. Trump has done nothing but follow Obama's lead. He also promised infrastructure programs but like Obama failed to deliver. The chickens are now coming home to roost.
     
  4. Dutch

    Dutch Well-Known Member Donor

    Joined:
    Apr 24, 2010
    Messages:
    31,243
    Likes Received:
    4,520
    Trophy Points:
    113
    Why blame? A good opportunity to buy... is what I’m gonna do. Stop looking for negatives and enjoy life... will yea? :hug:
     
    yardmeat and Josephwalker like this.
  5. 61falcon

    61falcon Well-Known Member

    Joined:
    Apr 27, 2018
    Messages:
    2,282
    Likes Received:
    1,080
    Trophy Points:
    113
    Gender:
    Male
    Depends on the whether,whether it is or whether it isn't.
     
  6. ronv

    ronv Well-Known Member

    Joined:
    Feb 5, 2018
    Messages:
    4,617
    Likes Received:
    1,637
    Trophy Points:
    113
    Gender:
    Male
    Pretty old news.
     
  7. Giftedone

    Giftedone Well-Known Member Past Donor

    Joined:
    Jul 7, 2010
    Messages:
    33,686
    Likes Received:
    3,952
    Trophy Points:
    113
    Holy Carp - I did not realize we were at 32 times PE. That's really high - historical average is 12-14.
     
    Carl Von Clausewitz likes this.
  8. Giftedone

    Giftedone Well-Known Member Past Donor

    Joined:
    Jul 7, 2010
    Messages:
    33,686
    Likes Received:
    3,952
    Trophy Points:
    113
    Not if the 32 x PE comment by another poster is correct. That's way too high. 12-14 is historical average.
     
    Carl Von Clausewitz likes this.
  9. ronv

    ronv Well-Known Member

    Joined:
    Feb 5, 2018
    Messages:
    4,617
    Likes Received:
    1,637
    Trophy Points:
    113
    Gender:
    Male
  10. Giftedone

    Giftedone Well-Known Member Past Donor

    Joined:
    Jul 7, 2010
    Messages:
    33,686
    Likes Received:
    3,952
    Trophy Points:
    113
    Carl Von Clausewitz likes this.
  11. Nonnie

    Nonnie Well-Known Member Past Donor

    Joined:
    Dec 25, 2017
    Messages:
    2,217
    Likes Received:
    1,054
    Trophy Points:
    113
    Gender:
    Male
    Trump lowered taxes but expects the increase in the economy will cover the reduction. It's then obvious that at some point, inflation will happen. When this happens, Trump will blame the Federal Bank.

    Economies are like a sine wave, maybe America hasn't too long to go before it's at the top and begins the slide down.
     
  12. Carl Von Clausewitz

    Carl Von Clausewitz Well-Known Member

    Joined:
    Oct 1, 2018
    Messages:
    1,155
    Likes Received:
    224
    Trophy Points:
    63
    Gender:
    Male
  13. The Don

    The Don Well-Known Member

    Joined:
    Aug 9, 2018
    Messages:
    735
    Likes Received:
    404
    Trophy Points:
    63
    It could be the start of a major correction, then again it could be a one day blip in the longest bull market in history.

    IMO we'll only know in a few weeks or months.

    The one thing I am confident of is that if there is a major correction, the Democratic Party will blame President Trump and his policies and the GOP will blame the Fed, Obama and Hillary.
     
    yardmeat likes this.
  14. Mandelus

    Mandelus Well-Known Member

    Joined:
    Jul 15, 2015
    Messages:
    8,443
    Likes Received:
    1,392
    Trophy Points:
    113
    Correct ... right this will happen or alternatively it will be explained with BS chattering or they will blame the bad guys of Wall Street again to be guilty for it.
     
  15. Carl Von Clausewitz

    Carl Von Clausewitz Well-Known Member

    Joined:
    Oct 1, 2018
    Messages:
    1,155
    Likes Received:
    224
    Trophy Points:
    63
    Gender:
    Male
    Poor partisan fools can't see that both political parties collude together with Wallstreet.

    There is no independent grassroots political party or organization in the United States, they own it all. You all think you're getting freedom, democracy, independence, and better livelihoods where you can't even see the noose tighten around your own necks with every pressing year.

    You all think there are huge differences between both parties.:lol:

    ....Suckers....
     
    Last edited: Oct 11, 2018 at 5:43 AM
  16. alexa

    alexa Well-Known Member Past Donor

    Joined:
    Nov 10, 2008
    Messages:
    13,244
    Likes Received:
    1,370
    Trophy Points:
    113
    Gender:
    Female
    Footsie continues to fall which they are now calling a 'correction'

    European shares at 20 month low

    China goes even further into the red

    “It is fair to observe and all people are observing that the US equity market and stock markets in general have been extremely high”.
    https://www.theguardian.com/busines...b07b0b8d7a343a#block-5bbf0161e4b07b0b8d7a343a

    Is this the next 2008 people have been talking about?
     
    Last edited: Oct 11, 2018 at 8:25 AM
    Carl Von Clausewitz likes this.
  17. The Don

    The Don Well-Known Member

    Joined:
    Aug 9, 2018
    Messages:
    735
    Likes Received:
    404
    Trophy Points:
    63
    Who knows ? Pundits have predicted thirty seven of the last three recessions.

    One day, one week or even one month is too short a time-frame to know whether it's a recession, a short wobble in confidence or just a bit of profit-taking. At any time there are so many different leading and lagging indicators that it's likely pundits can find a few that support their chosen narrative.

    If the Dow is down 20% or more in two or three months time then perhaps it is right to talk about a correction. Until then IMO it's just speculation.
     
  18. Josephwalker

    Josephwalker Well-Known Member

    Joined:
    Nov 25, 2016
    Messages:
    6,964
    Likes Received:
    2,817
    Trophy Points:
    113
    Sears filed bankruptcy yesterday and that was a big part in the fear based sell off. Add to that the feds raising interest rates and recent bond performance and investors got panicked. We are due for a correction though and when you add all this stuff up yesterday was the perfect storm
     
    Carl Von Clausewitz likes this.
  19. CourtJester

    CourtJester Well-Known Member

    Joined:
    Apr 1, 2013
    Messages:
    20,912
    Likes Received:
    3,204
    Trophy Points:
    113
    Hopefully you didn't buy since futures are significantly down for a second day. Market is close to fully valued so to buy or not to buy is a bit of a crap shoot. My guess is buy with caution although there is a significant risk if the Democrats take the House and / or Senate.
     
    Last edited: Oct 11, 2018 at 8:58 AM
  20. squidward

    squidward Well-Known Member

    Joined:
    Jan 23, 2009
    Messages:
    24,310
    Likes Received:
    3,325
    Trophy Points:
    113
    The Fed missed them all
     

Share This Page