Stock markets plummet around the world today

Message Bookmarked

Bookmark Removed

http://graphics8.nytimes.com/images/2007/02/27/business/0228-pg1-webSTOX.gif

― Maria :D, Wednesday, 28 February 2007 03:24 (nineteen years ago)

http://www.ilxor.com:8080/ILX/ThreadSelectedControllerServlet?boardid=40&threadid=52467#unread

― Eisbaer, Wednesday, 28 February 2007 03:59 (nineteen years ago)

China has apparently been in some kind of stock market craze (mom and pop taking out second mortgages to buy stock and the like) and was due for a "correction" -- somehow this in turn had an affect on other markets (finance types to thread?) as did news of a possible US economy slowdown, oil price increases, and signs that the housing market is not about to recover

― Hurting 2, Wednesday, 28 February 2007 04:02 (nineteen years ago)

well, there is all of this chinese stuff (of which i didn't know until today). what i did know (just from watching my own [modest] portfolio) is that the stock market had been scorching hot since late summer until just about a week ago -- obviously some sectors more than others (commercial real estate, e.g., has been posting MAD returns over the past few years; then there are the international markets). also obviously, i've been reading lotsa folks now saying that tomorrow should be a good "buying opportunity" (we'll see).

i definitely think that some sectors were in need of price correction -- e.g., the p/e's of the companies owned by my commercial REIT fund are off the charts -- so i don't think that that sector (or "developing markets" [read: china]) will lead any rebounds (if any). but we'll see -- i'm no guru.

― Eisbaer, Wednesday, 28 February 2007 04:20 (nineteen years ago)

So are we sticking with this thread, then?

― Hurting 2, Wednesday, 28 February 2007 04:26 (nineteen years ago)

sure -- maria's graphix are cooler than my link! :-)

― Eisbaer, Wednesday, 28 February 2007 04:26 (nineteen years ago)

I went from having a 4.29% increase in my portfolio from December to a .29% Increase today! Speculating is exciting!

― Jimmy The Mod Awaits The Return Of His Beloved, Wednesday, 28 February 2007 04:34 (nineteen years ago)

Just remember it don't mean nuthin til you sell.

― Hurting 2, Wednesday, 28 February 2007 04:49 (nineteen years ago)

Course, I don't actually own any stock right now. I'm still a bit shy of the savings goal I want to reach before I start putting money in the market.

― Hurting 2, Wednesday, 28 February 2007 04:50 (nineteen years ago)

well yeah, but it's still amusing!

― Jimmy The Mod Awaits The Return Of His Beloved, Wednesday, 28 February 2007 04:52 (nineteen years ago)

The world of investment is great entertainment, which is a big part of why I subscribe to the Wall Street Journal with no investment portfolio to speak of.

Or do you mean your situation is amusing?

― Hurting 2, Wednesday, 28 February 2007 04:55 (nineteen years ago)

well now that I have a mega surplus of cash I can buy @ roughly the same price it was 3 months ago and start all over

― Jimmy The Mod Awaits The Return Of His Beloved, Wednesday, 28 February 2007 04:57 (nineteen years ago)

LOL Sydney:

http://newsimg.bbc.co.uk/media/images/42622000/jpg/_42622085_asx203ap.jpg

― James Mitchell, Wednesday, 28 February 2007 05:30 (nineteen years ago)

I love this lead from the WSJ site:

"A dramatic plunge in stocks world-wide is forcing global investors to reevaluate their appetite for risk."

Gee, this "risk" stuff doesn't seem so great now that I'm losing money.

― Hurting 2, Wednesday, 28 February 2007 05:51 (nineteen years ago)

http://www.areyougame.com/images/items/HB00044.jpg

― gershy, Wednesday, 28 February 2007 06:00 (nineteen years ago)

well yeah, but it's still amusing!

What pisses me off about it is that I don't play the stock market. I don't buy shares and I don't like to work for companies that give me share options in lieu of actual money. I have no appetite for risk, and yet the stock market crash still affects me because even when I put money into a company pension or a government-sponsored savings scheme, the fuckers can't help themselves, they go ahead and put it into shares and oh look, I lose money.

― accentmonkey, Wednesday, 28 February 2007 08:42 (nineteen years ago)

Who can explain the difference between gambling and investing? Why is one often outlawed and scorned and the other the basis for pensions and the economy? Sure, in investing, there are more variables besides dumb luck, but there are so many variables and unknowns that it too is basically about betting.

― Maria :D, Wednesday, 28 February 2007 11:33 (nineteen years ago)

I guess cos it's more of an informed guess than gambling. It doesn't really matter how much you know about poker, it's 100% about luck, while it's less so with investing. If you were going for an annoying angle you could say that investing is what the moneyed classes do while gambling is what the plebs do, but that would be wearying ILXish.

― The Wayward Johnny B, Wednesday, 28 February 2007 11:37 (nineteen years ago)

― G00blar, Wednesday, 28 February 2007 11:37 (nineteen years ago)

Poker is not even close to being 100% about luck.

― Tracer Hand, Wednesday, 28 February 2007 12:00 (nineteen years ago)

It doesn't really matter how much you know about poker, it's 100% about luck

This is about the most off the money thing you could have said. Luck is the basis of poker, in that the cards dealt are absolutely random. What this means in practice is that the playing field is level for everybody, and those with skill will find edges and exploit margins, in terms of when to bet and when to fold, that unskilled players will miss. As it's a zero sum game, the money will therefore flow from unskilled players to skilled ones.

Although in the short term, the turn of any card can be attributed to luck, in the long term, this "luck" evens out and skill becomes the only variable that can be applied. [Removed Illegal Link] of my own poker stats - taken from last summer, covering roughly 100k hands - which demonstrates what I mean.

― Mark C, Wednesday, 28 February 2007 12:11 (nineteen years ago)

Man, what is up with these illegal links?

http://img.photobucket.com/albums/v222/biondino/graph240706.jpg

― Mark C, Wednesday, 28 February 2007 12:11 (nineteen years ago)

you forgot to take the hours you sat playing, multiply them by minimum wage (or less), then subtract from "profits".

― sanskrit, Wednesday, 28 February 2007 13:04 (nineteen years ago)

True. But I like playing anyway so that fact that I earn $10/hour or so is a nice bonus. And I'm not sure I should be subtracting anything - I willingly do it in my free time.

― Mark C, Wednesday, 28 February 2007 13:18 (nineteen years ago)

£10/hour, not dollars. Sorry for confusion.

― Mark C, Wednesday, 28 February 2007 13:20 (nineteen years ago)

lol @ "Illegal link" - what site did you link to Mark??

It reminds me of when Windows says "Illegal operation" - I'm lookin over my shoulder like "damn, baby, I gotta bust outta here"

― Tracer Hand, Wednesday, 28 February 2007 13:26 (nineteen years ago)

I wasn't going to post the graph, just link to it, so it's that picture. Feds're cracking down on online gambling!

― Mark C, Wednesday, 28 February 2007 13:29 (nineteen years ago)

Well, when you invest, you are 'taking a gamble'--personally you're essentially betting on the success of a company. But, of course, you're actually providing capital for a real company that has decided to divide up its ownership. So it's more than gambling too.

G00blar on Wednesday, 28 February 2007 11:37 (2 hours ago)

You're not really providing capital for a company unless you buy on the initial offering.

Otherwise in some ways investing is like gambling, but it's generally accepted that with long-term stock market investing (as opposed to short-term speculation) the odds are well in your favor - as long as the economy keeps growing and you don't have to pull out in the middle of a depression. Whereas in Vegas-style gambling the odds are always designed to be against you.

― Hurting 2, Wednesday, 28 February 2007 14:13 (nineteen years ago)

were on a bit of a correction in europe at the moment, Up since open, have to see what NY does in a couple of hours.

― Ed, Wednesday, 28 February 2007 14:14 (nineteen years ago)

"Slowly screwing my way across Europe, I had to make a correction"

― Hurting 2, Wednesday, 28 February 2007 14:55 (nineteen years ago)

I helped drive it all into the toilet yesterday afternoon by selling $2K worth of mutual fund shares to pay off tuition

― TOMBOT, Wednesday, 28 February 2007 15:24 (nineteen years ago)

this is good news because it means when I finally get done with school and get a new jarb I will hopefully be buying low, not like last spring when right after I decided "emerging markets" were a good idea that whole sector decided to shit the bed

bears are having a field day with this and talking about how the chinese sell-off was just the excuse institutional bigtimers needed to start ditching lots of bad ideas they've had over the last four years (housing etc.)

― TOMBOT, Wednesday, 28 February 2007 15:27 (nineteen years ago)

Comments here are amusing:

http://forums.wsj.com/viewtopic.php?t=321

The gold fever will never die -- "Money isn't real money, but gold is!"

― Hurting 2, Wednesday, 28 February 2007 15:31 (nineteen years ago)

goldbugs always forget they're talking about a single commodity vs. the entire market. you could do the same with anything in a crash. "money isn't real money, but basketball teams are!"

― TOMBOT, Wednesday, 28 February 2007 15:42 (nineteen years ago)

oh right but you can't con middle class wingnuts into paying for lots and lots of basketball teams they'll never see

― TOMBOT, Wednesday, 28 February 2007 15:43 (nineteen years ago)

wait you mean that denver nuggets bastard lied to me?

― ghost rider, Wednesday, 28 February 2007 15:45 (nineteen years ago)

I'll bet we could make serious money by buying up a lot of any commodity and self-publishing a few books and starting a couple of blogs and sites about why banana futures will weather the coming economic storm or whatever.

― Hurting 2, Wednesday, 28 February 2007 15:46 (nineteen years ago)

futures are good for the atheists worst nightmare

― and what, Wednesday, 28 February 2007 15:50 (nineteen years ago)

Buy Dead Dogs.

― Ed, Wednesday, 28 February 2007 15:51 (nineteen years ago)

this is going to be a strange question about a suspicion i've always had, but stay with me.

i've always wondered about the post '87 crash instituting of a "circuit breaker" rule that halts trading for an hour or two (or even the day) if the DJIA drops precipitously. i entirely understand the value of it, give people a chance to cool their heads and not make rash fear driven decisions, allow time for automated trades to be changed or retooled so the market isn't sucked into an auto-sell vicious cycle. but it just seems unnatural.

if you look at it from an evolutionary perspective, organisms have constant background survival pressures put on them, much like (though in an active sense) companies struggling to stay afloat by making calculated decisions, merging with other companies, etc, with the market responding real time to their decisions. every now and then a huge disaster will hit a living population and wipe out much of it, those flexible enough continue on. not so anymore for the market in aggregate, as these defensive maneuvers written into trading rules attempt to blunt the impact of a sudden massive downward market correction.

i know its a poor comparison that doesn't really work, but what i'm getting at here is this: it's rules like this minimizing risk that make me think the deck is stacked. so there's this cushion against immediate bloodletting, but no protection for irrational optimism. the rules have no curb for absurd irrational behavior such as the market growing 1% each for forty days, yet a 40% drop in one day is not allowed. again, feels like they're stacking the deck.

― sanskrit, Wednesday, 28 February 2007 23:16 (nineteen years ago)

it's there to allow institutional investors time to formulate a cohesive response. This is better in the long term for everyone because it means less volatility for the heavies like state pension plans, credit unions, and myriad consumer banks as well as the big "corporate" holders.

it's stacking the deck in favor of a safer marketplace overall, to stop panic from becoming widespread and prevent the modern equivalent of a run on the town bank.

at least that's how I understand it. at any rate the stoppage probably saved me, personally, at least couple of hundred bucks when I needed to get my tuition $$$ transferred into checking. I sure as hell didn't plan on becoming part of a meltdown.

― TOMBOT, Wednesday, 28 February 2007 23:26 (nineteen years ago)

you're absolutely right, and that is how i've always understood it, but not what i'm really getting at. it just seems odd that no one questions that this pillow is placed there without a corresponding measure to curb expanding bubbles of irrational buying. it seems that the protections it affords comes with an inherent bias towards bullishness (i assume shorters hated it when it came out).

― sanskrit, Thursday, 1 March 2007 00:42 (nineteen years ago)

WTF is natural about the stock market?

― Hurting 2, Thursday, 1 March 2007 02:41 (nineteen years ago)

My portfolio is now - 4% :(

― baaderonixx, Thursday, 1 March 2007 09:28 (nineteen years ago)

possible answers as to why there's nothing stopping upside "bubbles": (a) the circuit breaker rules may have been implemented in the aftermath of the Great Depression (that's just a guess -- some research on precisely when the circuit breakers were initially implemented is in order); (b) dramatic drops or corrections are perceived psychologically as more "destructive" than asset bubbles (although of course asset bubbles LEAD to later crashes and corrections and also cause all sorts of economic distortions and idiocies); (c) no-one gave it any thought (either in the exchanges or the appropriate regulatory agencies) or, if they did, there was industry backlash (b/c of all the $$$ being generated on trades and buying and so on -- though, of course, you can also make lotsa money when the markets go DOWN too).

― Eisbaer, Thursday, 1 March 2007 09:36 (nineteen years ago)

jesus christ, the plunge won't stop...

― baaderonixx, Thursday, 1 March 2007 13:26 (nineteen years ago)

eisbar i just said the circuit breaker rule was installed after the '87 crash. but all good points.

― sanskrit, Thursday, 1 March 2007 13:54 (nineteen years ago)

I think another reason might be because a plunge is pretty instantaneous compared to a bubble. I imagine it's fairly easier to agree on what constitutes the former, when exactly the circuit breakers should kick in, etc. I'm not sure if there's something analogous to the hour or two hour break that could be used to put the breaks on something like the internet bubble, or the housing bubble, which play out over a matter of months...

― porcus dei, Thursday, 1 March 2007 14:03 (nineteen years ago)

http://tinyurl.com/2997qj

― Tracer Hand, Thursday, 1 March 2007 14:19 (nineteen years ago)

yeah porcus dei said it better than I was going to say it - stopgaps against greed have always been tougher to implement than stopgaps against panic. Look at Enron, especially from the perspective given in this Malcolm Gladwell piece. I-bankers who bought into them without looking at the real numbers got off scot-free, and how are you supposed to prosecute people for blindly raking in monopoly money anyway? "You are under arrest for not being bearish enough"

― TOMBOT, Thursday, 1 March 2007 14:20 (nineteen years ago)

Also you have considerable control over how much money you make/lose from a bubble because you have plenty of chances to pull your money out. If there's simply a panic, you're losing money because of mass psychology that you can't stop.

― Hurting 2, Thursday, 1 March 2007 14:31 (nineteen years ago)

During the dotcom boom years there were all these analysts and investors who would get interviewed and they would say things like "if you look at price-to-earnings, there is just no way to justify these stock prices" and "this certainly has all the hallmarks of a classic bubble" and I imagined them saying these things between stifled giggles.

― Tracer Hand, Thursday, 1 March 2007 14:36 (nineteen years ago)

Do any of you guys read the Big Picture? Excerpt:

UPDATE: February 27, 2007 10:59pm

Kudlow starts the show with the famous J.P. Morgan quote: Prices will fluctuate. I respond that we haven't seen much volatility, and prices have only moved in one direction for the past 8 months. Larry corrects me, emphasizing the word "fluctuate."

My response: "Well, we got fluctuated pretty good today," thus, ending my TV career.

― TOMBOT, Thursday, 1 March 2007 14:39 (nineteen years ago)

A guy on Coast to Coast AM said this coincided perfectly with bizarre solar activity and whatever's going on in the zodiac right now. NASDAQ: you should have read your horoscope.

(note: I do not agree with above statement)

― Abbott, Thursday, 1 March 2007 17:08 (nineteen years ago)

If there's simply a panic, you're losing money because of mass psychology that you can't stop.

bubbles aren't the herd following the herd?

― sanskrit, Thursday, 1 March 2007 20:17 (nineteen years ago)

Yeah, but you don't have to follow the herd following the herd in a bubble.

― Hurting 2, Thursday, 1 March 2007 23:21 (nineteen years ago)

plus order of magnitude difference in speed

― TOMBOT, Thursday, 1 March 2007 23:50 (nineteen years ago)

ten months pass...

Alright, I'm now getting seriously freaked out and really cursing myself for not having sold everything 2 weeks ago. It's not like I hadn't been warned. I'm so dumb

― baaderonixx, Wednesday, 16 January 2008 09:12 (eighteen years ago)

RIP savings and baaderonixx jr.'s college education.

― baaderonixx, Monday, 21 January 2008 09:08 (eighteen years ago)

seven years pass...

A lot of emerging markets looking very shaky atm:

http://www.theguardian.com/business/2015/aug/19/emerging-markets-shine-dims-as-capital-flight-nudges-1tn-in-a-year

The Tenge lost 35% of its value when the Kazakh government stopped pegging it to the USD today, the Rand is at its lowest point for 14 years, the Turkish Lira has been dropping, the Rouble is back to February levels of 100+ to the GBP, etc, etc.

― I wear my Redditor loathing with pride (ShariVari), Thursday, 20 August 2015 12:42 (ten years ago)

You must be logged in to post. Please either login here, or if you are not registered, you may register here.