Wednesday, January 07, 2009

2009 a Year to Endure

We got the end of year relief rally after meeting fund redemptions. 8800 and 8200 seem to bring back any pice tthat strays too far. Flat to a slow grind down from today's close to the inauguration and one last euphoria defiant bounce then the market opens for 2009. Right back down to 8200 then long slow grinds with occasional stairsteps down. All the way down to 6800. It may go breathtakingly below that very briefly but 6800 will be the new gravity well. We'll go into fall low 7000s. Finish? Not a clue. Ask my assistant:

17 comments:

wagga said...

Dawgs up and posting first thing in the morning. No market for hours yet.

Lou Minatti said...

Wagga, Rob didn't post this in the middle of the morning. He just auto-scheduled the posting time in Blogger.

Rob has been in South America studying plants for the past few weeks. Anything you see from him was written back in November.

ncbill said...

"Vacancy rates in office buildings exceed 10 percent in virtually every major city in the country and are rising rapidly, a sign of economic distress that could lead to yet another wave of problems for troubled lenders."

Commerical real estate collapse, here we come!

http://exurbannation.blogspot.com/2009/01/2009-year-to-endure.html#comments

Nineteen said...

I think you are very close, Rob - I have assumed halving to 7000 from the outset of the dive.

Rob Dawg said...

Everybody has an opinion. Mine is no better but anyone who isn't bracketing their opinions with wide margins is lying and not to be trusted.

Mike said...

Rob, you silly man. Dont you realize that all of present, and future bad news has already been priced in? To infinity and beyond!

More seriously, with those preditictions, you must be of the deflation persuasion. I am too in the short turn but I fear a a swift change to hyperinflation in the not so far off future due to the current gov't policies and reckless printing. Thoughts?

Rob Dawg said...

...with those preditictions, you must be of the deflation persuasion. I am too in the short turn but I fear a a swift change to hyperinflation in the not so far off future due to the current gov't policies and reckless printing. Thoughts?

Absolutely. I had to be dragged into the short term deflation camp. I thought we'd be able to inflate away the deflationary aspects of the credit velocity slowdown but that said hyperinflation is an absolute certainty at this point. My poor HELOC lender is hurting as I borrow at 3.25% and they get paid back with 50% less valuable pesodollars.

Mike said...

Rob, we are definitely on the same page.

My poor HELOC lender is hurting as I borrow at 3.25% and they get paid back with 50% less valuable pesodollars.

Which is one of the reasons that I dont know how long I am going to wait to buy a home. I wouldn't mind paying a super low interest rate for the next 30 years with those inflated dollars either. So many other things to consider though...

Any consensus among those in our camp about how long we will be in a deflationary period?

Jean ValJean said...

tee-hee...

totally unrelated, but I had to share my never-ending admiration for Benoit (TM).

From Caseypedia:

Breaking news: Debt collectors -- Casey changed his phone number in early 2009 in an effort to hide from you. The new number is 916-248-4102.

Property Flopper said...

OK - now that's funny.

Kasey Skala said...

ncbill: on a related note, if rental income from commercial property falls even 5% that could trigger massive amounts of commercial defaults. Deutsche Bank says 3% by end of 2010. I say we see 3% well before the end of '10.

How do we finish '09? With a glass of scotch and half the hair that we have left.

Benoit™ said...

heh... thanks JVJ. :)

I also apprised the nice folks over at CampIdiot... I'm sure they'll exercise restraint and only call Casey in absolute emergencies. ;-)

Akira said...

2009 will be Rodney King 2.0 in the Bay Area thanks to this pathetic POS. What a looser™.

Akira said...

@Dawg,
Since you never much liked trains, public transit, BART and such, you must be pleased that it's so F-ed up now.

w said...

Just a question for the smart people out there.

I was looking at a universal life policy and am curious if the they are one of the ticking time bombs in the world of structured financial products. You get like 2% in bank savings accounts but you get 5% on your payments you make into the universal life policy. You get to use this as a tax deferred investment account. But how can the insurance companies use your money, pay you 5%, make your premium payment, and make a profit for their time and effort? What risk have they taken on? When Riverpark bonds start failing are life insurance companies going to need to be bailed out too?

Rob, thanks for the eye candy. Things were a little too serious here for a while.

Rob Dawg said...

At 8:11 PM, Blogger Akira said...

@Dawg,
Since you never much liked trains, public transit, BART and such, you must be pleased that it's so F-ed up now.


That's pretty callous. The shooting has very little to do with the dysfunction of US transit. In general transit is pretty safe.

Rob Dawg said...

What risk have they taken on? When Riverpark bonds start failing are life insurance companies going to need to be bailed out too?

Yup. insurance companies have been reinvesting and able to use statistics to "sefely" invest in illiquid assets and hedge against unexpected demands for payouts. Both the investments and the hedges have blown up. They are one outlying event away from insolvency. The result will be "other" insurance skyrocketing, you know the stuff you have to have.