wagner Posted March 13, 2013 Report Share Posted March 13, 2013 Some of this is a bit over my market smarts, but is kind of scary http://finance.yahoo.com/blogs/daily-ticker/stock-market-debt-fueled-bubble-steve-keen-121950839.html Quote Link to comment Share on other sites More sharing options...
2highpsi Posted March 13, 2013 Report Share Posted March 13, 2013 Where is he getting his 70% number? 50% is the typical max. Anything going over would trigger a "margin call" requiring the account holder to deposit additional capital, or liquidate securities. Guys like him typically hold short positions, then spew garbage like this hoping it causes a market dip. Then they make money. Quote Link to comment Share on other sites More sharing options...
wagner Posted March 13, 2013 Author Report Share Posted March 13, 2013 Where is he getting his 70% number? 50% is the typical max. Anything going over would trigger a "margin call" requiring the account holder to deposit additional capital, or liquidate securities. Guys like him typically hold short positions, then spew garbage like this hoping it causes a market dip. Then they make money. Ok, that is some good info there. I read that twice and it seemed to be a bit much to me. I know enough about the markets to realize I should not try to play in them :lolguy: Quote Link to comment Share on other sites More sharing options...
zeitgeist57 Posted March 13, 2013 Report Share Posted March 13, 2013 Technically, everything bought in $USD could be classified as a "debt-fueled bubble", funded primarily by China. Sad, but true. Quote Link to comment Share on other sites More sharing options...
2highpsi Posted March 13, 2013 Report Share Posted March 13, 2013 Ok, that is some good info there. I read that twice and it seemed to be a bit much to me. I know enough about the markets to realize I should not try to play in them :lolguy: Don't get me wrong, it's possible to use crazy leverage strategies where the underlying security is "purchased" with pennies on the dollar. I just don't believe that makes up anywhere near 70% of the market. I'm not a perma-bull either. I see some things that I believe could cause a market down turn. But it's not the bullshit that this guy is spewing, and I don't see another (near term) market turn down to the likes he is talking about. Hypothetically speaking: If the market got cut in half tomorrow (Dow 7000) I know a ton of people that would take all their money off the sideline and invest. Because they remember how fast it just came back last time. Fundamentally that would put some really good companies selling at 4 and 5 PE ratios. And this guy is claiming a near 63% drop??? No fucking way Quote Link to comment Share on other sites More sharing options...
zeitgeist57 Posted March 13, 2013 Report Share Posted March 13, 2013 I agree with Jordan. Since 2008 - and with all the regulations since then - trading on margin is a more tightly regulated business. That being said, I have no doubt that people - mostly market-movers with a ton of dough - will ALWAYS find a way to game the system. BUT, I highly doubt that much margin is being used to fuel the market rise. As a former FINRA-license adviser, I can tell you of the $$$billions that are still sitting "on the sidelines" since the market crashed in '08/'09. If you had just a single-digit percentage gain of investments from savings, CDs, bonds back into the stock market, you'd see this sort of increase. Now...the bigger bubble I'd watch out for is the bond market. If stocks maintain this higher level through a few quarters, and people get dividends that pay better than 1.5%, then you may see a flight back into the market... Quote Link to comment Share on other sites More sharing options...
Tractor Posted March 15, 2013 Report Share Posted March 15, 2013 Ha 70%, during the year 1929 margin was being leveraged at a rate of 10 to 1, now that was a bubble. I use margin all the time, but I wouldn't hold anything overnight using margin unless it was something very obvious. Quote Link to comment Share on other sites More sharing options...
Tractor Posted March 15, 2013 Report Share Posted March 15, 2013 If their is any bubble at this point in our economy it is being caused by extremely low interest rates which I saw are starting to rise and that is actually a good sign. Quote Link to comment Share on other sites More sharing options...
Patterson Posted March 15, 2013 Report Share Posted March 15, 2013 Buy F-Body parts, Profit. Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.