Comments on: The Most Volatile Market Ever

By: Patrick Neid

Patrick Neid — Wed, 26 Nov 2008 11:46:44 +0000

Enjoy it while it lasts. You will miss it when it is gone.

By: Simon

Simon — Tue, 25 Nov 2008 21:47:59 +0000

The chart posted by Prieur du Plessis looks like the seismigraphic output of a very large earthquake. Financial storms seem to superficially have interesting parallels to some physical systems like earthquakes.

They are extremely difficult to predict

The normal low level cyclical graph (small wiggly line) suddenly becomes greatly amplified (big wiggly line)

Lots of damage ocures to brittle structures, (think leveraged institutions)

Ductile structures suffer less damage, (think primary productive enterprises that have a cash buffer)

Failure in one area can lead to a progressive failure in the entire system.

For example a falling crane strikes the corner of a concrete car parking building causing punching failure in the corner column. The force of the top deck landing on the next deck down is sufficient to set of a similar failure in adjacent columns resulting in a progressive failure until either the entire building is flattened or a discontinuity in the system is reached and the progression stops. (think banks lending to each other and using the loans as equity). Actually the twin tower failures were similar also.

A kind of measure that would help mitigate or eliminate the risks of large progressive failures would be deliberate discontinuities in the system, like a fire break or a seismic gap.

Another measure would be having a professional body charged with maintaining the stability of the system. Such peoples education and primary concern would be, like engineers creating stable durable structures. Not the enrichment of themselves or their clients. Reward would be like any other profession based on recognition of achievement in design and technical excellence.

By: DL

DL — Tue, 25 Nov 2008 21:37:30 +0000

leftback @ 4:21

“Either way I think 840 holds and the trading range between 840-980 is back in play”

SPX got to 741 on 11/21/08. I don’t think we necessarily have to retest that before the end of December, but I have to think that we get at least as far down as 800 before the end of the year, and certainly before inauguration day.

By: Mannwich

Mannwich — Tue, 25 Nov 2008 21:23:14 +0000

I have to admit that I have no clue which way things are going the rest of the week. Will likely sit tight in my positions (unless we swing wildly in one direction) and watch most of it from the sidelines. Very cautious right now. Nothing suprises me anymore.

By: leftback

leftback — Tue, 25 Nov 2008 21:21:30 +0000

John, I have it played the other way around, I think tomorrow will be down after durable goods and the deteriorating credit news, plus a safety trade ahead of the holiday. Friday and/or Monday will be the up day/s.

Either way I think 840 holds and the trading range between 840-980 is back in play.

By: jmborchers

jmborchers — Tue, 25 Nov 2008 21:14:55 +0000

Tomorrow should be a relatively big up day for positive consumer speculation going into Black Friday. How hard could it be to beat 50% of last year’s sales?

Friday I expect will be then down.

By: thefinancedude

thefinancedude — Tue, 25 Nov 2008 21:04:04 +0000

http://www.minyanville.com/articles/C-citigroup-STOCKS-volatility-bailout-liquidity/index/a/20123

According to Mr Practical: The stock indexes have moved more in the last 50 days than they have for the last 50 years.

By: TrickStar

TrickStar — Tue, 25 Nov 2008 21:01:10 +0000

The bottom was last Thursday. Anticlimactic, I know.

By: Mannwich

Mannwich — Tue, 25 Nov 2008 20:23:58 +0000

@AT: Yes, unlike many, you get to keep your money and then some…….at least for now. Isn’t that “reward” enough?

By: I-Man

I-Man — Tue, 25 Nov 2008 20:14:51 +0000

AT:

I award you as “TBP Chief Elliot Wave BadAss”