Global Correction

[zorro1]

I understand the banks have slowed down their lending and the affect it will have on family's and small business but In what way will the current situation effect Thailand ?

[midas]

[

The market needs to be cleaned out. Further drops may happen as predicted by Vibe's articles and interview vids from Fabar, Rogers, and Paul.

Fear is a very strong emotion in the markets. Just like greed and "irrational exuberance."

And I also add the "sheople" factor. These sheople are people that started jumping into financial investing for the first times in their lives in the 1990s, when it became "cool" and became "easy money."

That's not the way it works.

The market needs to go down further, to clean itself out, IMO.

I disagree with you. In any market you're always going to get people even novices jumping in when they see

attractive returns-that happened in the past and it will happen again in the future.

The "sheople" factor-was not the real problem in this crisis - it was made much worse by people who granted

mortgages to customers who had no real income and then by extremely greedy Wall Street characters

who compounded it even further with their brilliant so called " synthetic " investments

[midas]

I understand the banks have slowed down their lending and the affect it will have on family's and small business but In what way will the current situation effect Thailand ?

zorro are you talking about Thai banks ?

I raised this question earlier this week and amazingly it seemed a few days ago that there hadnt been any substantial or noticeable

changes in credit conditions here yet ? Thai's could still get credit without too many difficulties at the moment - unless it has just

changed now over the last few days

[zorro1]

I understand the banks have slowed down their lending and the affect it will have on family's and small business but In what way will the current situation effect Thailand ?

zorro are you talking about Thai banks ?

I raised this question earlier this week and amazingly it seemed a few days ago that there hadnt been any substantial or noticeable

changes in credit conditions here yet ? Thai's could still get credit without too many difficulties at the moment - unless it has just

changed now over the last few days

Yes thanks Midas I was talking Thai banks and just trying to figure in what way the Thai banking system would be effected

[LivinLOS]

You guys still here ???

Well at least I guess the argueing over if we were scaremongering has now got a lot quieter

Black October in the works !!

$ 700 billion+ - Proposed Treasury Department legislation

$ 29 billion - Bear Stearns financing

$ 200 bilion - Fannie Mae and Freddie Mac nationalization

$ 85 billion - AIG loan and nationalization

$ 300 billion - Federal Housing Administration housing rescue bill

$4 billion - Mortgage community grants

$87 billion - JPMorgan Chase repayments

$200 billion+ - Loans to banks via Fed's Term Auction Facility

$ 50 billion - Loans from Depression-era Exchange Stabilization Fund

$144 billion - Purchases of mortgage securities by Fannie Mae and Freddie Mac

TOTAL: $1.8 trillion+

COST PER US HOUSHOLD: $17,064+

Don't hear much about what they already spent.

Also when the Fed doesnt get its 700 bn, what does it do ??

http://www.bloomberg.com/apps/news?pid=206...movers_by_index

The Fed today said it will pump an additional $630 billion into the global financial system to address the worst banking crisis in almost 80 years.

So voted down on the 700bn to the banks.. so open the floodgates and give them 630 anyway !!!

Got gold ??

[OlRedEyes]

Problem is, even if you run your own company without much credit, your customers are going to disappear.

There is nothing wrong with credit if it is used in a business sense

to generate more money. The problem in American is it has been used on such

a wide scale just to purchase consumer goods that instantly start to depreciate in value.

You would not find many Asians that do that and yet they were quite happy to provide

the money to US citizens to keep doing it.

Read the context of the remark.

[LivinLOS]

Problem is, even if you run your own company without much credit, your customers are going to disappear.

There is nothing wrong with credit if it is used in a business sense

to generate more money. The problem in American is it has been used on such

a wide scale just to purchase consumer goods that instantly start to depreciate in value.

You would not find many Asians that do that and yet they were quite happy to provide

the money to US citizens to keep doing it.

There is a problem if the business cannot survive without cheap credit..

Interest rates down in these single digits and below inflation is not historically normal.. So if the expectation is there for credit use, and that rug is pulled.. Those businesses will fail.

[OlRedEyes]

Something many people seem to miss is that it is an unbroken chain down to the consumer. It's not only about the banking/financial markets. Many businesses are going to fail, unemployment, bankruptcy, the consumer market on which the whole system is based is threatened. You may have a strong, cash-flush business, but if your customers, be they business or private, can't buy you can't sell. Goods or services. This is going down all the way in the chain.....

[russianrobert]

Asian markets have opened lower of course but nearly as badly as people thought they would.

What are the Asian markets saying?

We don't believe that congress will ultimately fail in passing the bill? Or

We believe the Asian banking system is fundamently sound and financial meltdown in the US will not have the same effect in Asia?

[flying]

Asian markets have opened lower of course but nearly as badly as people thought they would.

What are the Asian markets saying?

We don't believe that congress will ultimately fail in passing the bill? Or

We believe the Asian banking system is fundamently sound and financial meltdown in the US will not have the same effect in Asia?

Or they heard about this already??

Feds do their thing

[lannarebirth]

Can someone explain why when

6% mortgage loans are in trouble

Unemployment highest in 5 years and rising

Credit is crisis

Stock market on it's butt

THE U.S. DOLLAR IS UP?????????

I usually like to comment on what "is" rather than speculate on what "might be", but since this board seems to be about how people "feel" I'll give my opinion. My opinion is based on observation to date and guessing (like everyone else here).

The derivatives market is controling the movement of all things now. Every trade that's been put on is being taken off. Whatever's been done is being undone. Chart's are starting to look like mirror images with 2007 being the pivot point. Every trade on earth (slight exaggeration ) in the past 5-6 years has been an anti-dollar trade. Now, alotof that is by necessity being unwound. Some of that is obvious just by looking, but "my gut" (whom I'd be broke if I listened to often) says it may continue.

Edited September 30, 2008 by lannarebirth

[Naam]

Asian markets have opened lower of course but nearly as badly as people thought they would. What are the Asian markets saying?

everybody has an eye on the billions of liquidity which the central banks (not only in Asia but Australia too) made available today. anyway, Nikkei 4.5% down is quite severe but not as severe as expected and compared to what happened yesterday in other markets.

[lannarebirth]

Well, that can't be good in the short term:

http://www.bloomberg.com/apps/cbuilder?ticker1=.TEDSP%3AIND

ckick flash chart.

[russianrobert]

Asian markets have opened lower of course but nearly as badly as people thought they would. What are the Asian markets saying?

everybody has an eye on the billions of liquidity which the central banks (not only in Asia but Australia too) made available today. anyway, Nikkei 4.5% down is quite severe but not as severe as expected and compared to what happened yesterday in other markets.

That's true but i have a feeling Asia is thinking it can decouple from the American crisis.

Let's see how Europe responds in a few hours.

[siamamerican]

if some frustrated poor boy thinks that mentioning an important fact like tax savings in a discussion "why do you live in Thailand?" is "flaunting wealth in an obscure way" i can only smile. what is there to defend?

Where did you get the idea I was poor? OK, you are big, fat, ugly, and you smell like a monkey fart.

I could claim you are a racist from your post about immigration. Many US immigrants are from poor countries, not only the wealthy countries you listed. Please explain why the country is important.

Below is what you said and I have feeling you can't explain it.

"please list the countries according to priority from where the immigrants came during the last few decades or citizens who are presently applying for immigration. how many applications from Sweden, Norway, Finland, Denmark, Germany, France, Switzerland, Austria, U.K., Italy, Canada or Spain? "

What should I base the priority on? Does it really matter where they come from. Should I count people from lesser countries as half people.

[OlRedEyes]

What are the Asian markets saying?

Like all the markets they are desperately looking for a saviour. It's like putting that big bet down that in the back of your mind you KNOW, but will not admit, is going to lose.

All markets are in a panic. They are trying desperately to hold on. It's a game of chicken, because they know that all it is going to take is for one big player to lose his nerve then chaos will ensue as everybody else jumps in to try and get out as fast as possible. It's on a razor's edge, and the odds are loaded against them.

[cloudhopper]

Some interesting commentary on Asia from Bloomberg;

Days of Rage in Streets Start Derailing Asia: William Pesek

Commentary by William Pesek

Aug. 28 (Bloomberg) -- Asia has indeed decoupled -- not from the U.S. economy, but from political reality.

Thailand is Exhibit A. Three years ago, it was the post- Asian-crisis role model. Living standards were rising, investors were funneling in and Asian peers were envious of ``Thaksinomics.''

The reference here is to the dual-track plan to boost domestic demand and export growth championed by Thaksin Shinawatra. The former Thai prime minister was removed in a September 2006 coup amid corruption allegations. Thaksin fled to the U.K. and bought soccer team Manchester City.

Yet the military leaders who replaced him were painfully inept. That paved the way for the People Power Party to be elected in December 2007. Its pro-Thaksin leader, former television chef Samak Sundaravej, is facing massive protests and calls for his resignation.

And just like that, one of Southeast Asia's shining examples of stability, prosperity and democracy is descending into farce. The joke among investors is which English Premier League team will Samak buy if he flees Thailand?

It's less of a joking matter that strategists like Dwyfor Evans of State Street Global Markets in Hong Kong say Thailand's baht may slide more than 3 percent by year-end, leading global funds to pull money from the country.

Malaysia's Woes

Events in Malaysia also are troubling. Again, this is an economy than won kudos following the Asian crisis a decade ago. Malaysia's headline-grabbing backlash against the International Monetary Fund moved to the background as growth returned, stocks rose and commodity prices soared.

Now, headlines are filled with ``sodomy'' and ``opposition official arrested'' and ``leadership crisis.'' The personality in question is Anwar Ibrahim, who's been accused of having illegal sex with a man. This week, Anwar won back a seat in parliament, increasing his chances of ousting Prime Minister Abdullah Ahmad Badawi. Malaysia's government is adrift when its economy can least afford it.

``At a time when Asia is under pressure from external forces, strong and stable leadership is crucial,'' says Simon Grose-Hodge, a strategist at LGT Group in Singapore. ``Malaysia and Thailand seem unable to deliver that.''

Biggest Surprises

Politics often offer the biggest surprises in Asian markets. In recent years, investors have found themselves less shocked by reports on gross domestic product, inflation or stock movements than coup attempts, scandals or disagreements between neighboring governments.

Disputes abound: China and Taiwan over sovereignty, Japan and South Korea over rocks in the sea, Indonesia and Singapore over pollution, India and Pakistan over disputed territory, Thailand and Cambodia over borders and North Korea and the rest of Asia over nuclear weapons. The Philippines is often on guard for the next ``people power'' rebellion.

Politics is holding Asia back, distracting officials from spreading the benefits of growth, reducing poverty, improving education and upgrading roads, bridges and power system to compete in the global economy. It's also scaring away investors who are growing increasingly risk adverse as the global credit crunch worsens.

Success Story

The region does have its success stories, like Indonesia. Rampant corruption and persistent poverty aren't undermining President Susilo Bambang Yudhoyono's efforts to put Southeast Asia's largest economy on a higher growth path.

``Indonesia,'' says Bruce Gale, a political risk analyst based in Singapore, ``is a lot more stable politically than many foreigners seem to realize.''

Yet politics is even getting in the way of Asia's most developed nations. Take Japan, which is experiencing paralysis at the highest levels of government. Prime Minister Yasuo Fukuda's slipping political support is complicating efforts to shield Asia's largest economy from recession.

Recent declines in markets speak to how Asia hasn't decoupled from the U.S. economy, as pundits once asserted. This period of global instability would be less dangerous if governments were better equipped to handle them.

The fallout from Wall Street's losses continues to flow this way. Michael Dee of Temasek Holdings Pte, Singapore's $130 billion sovereign wealth fund, yesterday found himself in the surreal position of voicing confidence in the once mighty Merrill Lynch & Co.

Merrill has a ``great franchise which has existed through many crises through a long period of time,'' Dee, Temasek's senior managing director of international, told Bloomberg Television.

Unique Asia

Since December, Temasek, Merrill's biggest shareholder, has invested about $5 billion in the third-largest U.S. securities firm. Dee said he has ``great confidence'' in Merrill Chief Executive Officer John Thain. Last year, Thain replaced the ousted Stan O'Neal, who oversaw the firm's largest quarterly loss in its 93-year history.

If Southeast Asia is to stand its ground amid a potential U.S. recession it needs more predictable and transparent government. Only then will economies have credible institutions like judiciaries, central banks, media and watchdog groups to weed out corruption. From there, more efficient and stable economic growth might follow.

All this sets Asia apart from many of the world's markets. Analysts typically assess economies by locking themselves in offices and studying government data, bond yields, stock valuations, and the like. Here in Asia, more luck might be had looking out the window at the street demonstrations below.

(William Pesek is a Bloomberg News columnist. The opinions expressed are his own.)

To contact the writer of this column: William Pesek in Tokyo at [email protected]

[russianrobert]

What are the Asian markets saying?

Like all the markets they are desperately looking for a saviour. It's like putting that big bet down that in the back of your mind you KNOW, but will not admit, is going to lose.

All markets are in a panic. They are trying desperately to hold on. It's a game of chicken, because they know that all it is going to take is for one big player to lose his nerve then chaos will ensue as everybody else jumps in to try and get out as fast as possible. It's on a razor's edge, and the odds are loaded against them.

If that were true the Asian markets would be mirroring the NSE.

There is optimism in the Asian markets.

[lannarebirth]

The good news is, petrol would appear to be coming down in price.

In all the carnage (market closing on it's lows not particularly positive), I note Goldman Sachs (Americas defacto Treasury Dept, these past 15 years) closed $15 off it's intradaylows and $35 off its lows of the 18th.

[OlRedEyes]

What are the Asian markets saying?

Like all the markets they are desperately looking for a saviour. It's like putting that big bet down that in the back of your mind you KNOW, but will not admit, is going to lose.

All markets are in a panic. They are trying desperately to hold on. It's a game of chicken, because they know that all it is going to take is for one big player to lose his nerve then chaos will ensue as everybody else jumps in to try and get out as fast as possible. It's on a razor's edge, and the odds are loaded against them.

If that were true the Asian markets would be mirroring the NSE.

There is optimism in the Asian markets.

Are you saying they are decoupled from what's happening on the NYSE? Not from what I can see.

Sure there may be optimism. I maintain it is desperate optimism. a heartbeat away from panic.

Big players know that what they say publicly will seriously affect their investments. They have to appear optimistic, till the very moment they have managed to extricate themselves. There's been two instances of leading figures making a show of 'investing' in failed financial institutions lately, making a high-profile issue of it. That in itself is an alarm bell. They are trying to shore up some degree of confidence, because if they don't, all hel_l may break loose. Their very well publicised 'investment' is purely to try and protect their real investment. A hedge to boost confidence, nothing more.

[midas]

if some frustrated poor boy thinks that mentioning an important fact like tax savings in a discussion "why do you live in Thailand?" is "flaunting wealth in an obscure way" i can only smile. what is there to defend?

Where did you get the idea I was poor? OK, you are big, fat, ugly, and you smell like a monkey fart.

I could claim you are a racist from your post about immigration. Many US immigrants are from poor countries, not only the wealthy countries you listed. Please explain why the country is important.

Below is what you said and I have feeling you can't explain it.

"please list the countries according to priority from where the immigrants came during the last few decades or citizens who are presently applying for immigration. how many applications from Sweden, Norway, Finland, Denmark, Germany, France, Switzerland, Austria, U.K., Italy, Canada or Spain? "

What should I base the priority on? Does it really matter where they come from. Should I count people from lesser countries as half people.

[siamamerican]

Again, I'm at a loss at determining your point.

Also, look at the stock markets in the countries I listed. How are they performing compared to the US during the last 12 months.

Give it break. I'm not too intelligent, but you are quite ill equipped to discuss anything of relevance.

maybe you are not so quick on the uptake. My point is that you wrote a personal and objectionable

posting that Naam continually " flaunts his wealth " in his contributions to this forum which is no different

to you waffling on about your trading strategy

" I'm not too intelligent ' - ok then I don't have time to talk to you !

Waffling on my trading strategy. Another ignorant post.

Well, if I knew the future, I wouldn't have to wonder about trades. I don't - hence I change direction when the markets change. I sold calls because I thought last week's gains were short lived. I wish the calls I sold were deeper in the money, but you can't always win.

Just curious, try some reading some books that are obsessed with America. You might find that other countries aren't perfect.

Also, don't worry about Naam - he is very capable of defending himself and doesn't need the assistance of a fool.

[siamamerican]

If that were true the Asian markets would be mirroring the NSE.

There is optimism in the Asian markets.

I hope that is the case. Some of the Asian market are so beaten down, that they may have shrugged off Monday's NSE drop. At some point, I hope they stop reacting to the US markets. I have no idea what the markets across the globe are going to do in the next 10 days.

[russianrobert]

If that were true the Asian markets would be mirroring the NSE.

There is optimism in the Asian markets.

I hope that is the case. Some of the Asian market are so beaten down, that they may have shrugged off Monday's NSE drop. At some point, I hope they stop reacting to the US markets. I have no idea what the markets across the globe are going to do in the next 10 days.

There does seem to be some decoupling in progress. Bottom line i believe is that there is optimism in the Far Eastern markets brought about by faith in the solvency of the banking system and the resolve of their goverments to support them.

They are saying they can survive a meltdown in the US banking system.

I hope they are right.

[flying]

They are saying they can survive a meltdown in the US banking system.

I hope they are right.

Im not sure but the more I watch the less I think it is a US Banking system only problem.

I think it may be a banking problem period. I think none get out unscathed

[lannarebirth]

If that were true the Asian markets would be mirroring the NSE.

There is optimism in the Asian markets.

I hope that is the case. Some of the Asian market are so beaten down, that they may have shrugged off Monday's NSE drop. At some point, I hope they stop reacting to the US markets. I have no idea what the markets across the globe are going to do in the next 10 days.

No one does, but what we do know is that the Volatility index is currently at 45. That's extreme. It will either become very extreme (like '87) or it will retrace. What it won't do IMO is stay where it's at. Straddle.

[russianrobert]

They are saying they can survive a meltdown in the US banking system.

I hope they are right.

Im not sure but the more I watch the less I think it is a US Banking system only problem.

I think it may be a banking problem period. I think none get out unscathed

My point exactly.

[OlRedEyes]

They are saying they can survive a meltdown in the US banking system.

I hope they are right.

Im not sure but the more I watch the less I think it is a US Banking system only problem.

I think it may be a banking problem period. I think none get out unscathed

My point exactly.

They may be able (I doubt it though) survive a US banking system meltdown.

And that is the end of it then?

Awww, c'mon people. If you have such a superficial grasp on the world economy, you should be spending your money on beer, not investing it (in the markets or business).

[lordofdelusion]

The US is working on a MEGA PLAN to restore confidence and turn around the financial crisis and it seems it will work. Will cost hundreds of Billions of $'s but if not, it will cost a lot more.

Oh great. The Democrats, the party of no ideas, and the Republicans, the party of bad ideas, are working together. The only thing worse than either of them, is when these a$$8oles work together. I predict the end of the world by next Friday.

Did you think I was kidding when I posted this on the 19th???? These children cannot play together. Asking them to clean up this mess is like asking my 1 year old to clean up her diapers after she makes poopy.

I admit to being off on the Friday part. The really bad day was Monday.

[siamamerican]

If that were true the Asian markets would be mirroring the NSE.

There is optimism in the Asian markets.

I hope that is the case. Some of the Asian market are so beaten down, that they may have shrugged off Monday's NSE drop. At some point, I hope they stop reacting to the US markets. I have no idea what the markets across the globe are going to do in the next 10 days.

No one does, but what we do know is that the Volatility index is currently at 45. That's extreme. It will either become very extreme (like '87) or it will retrace. What it won't do IMO is stay where it's at. Straddle.

Odd times! Last year I was a buy and hold proponent and felt over the long term this strategy would work. This year I've been buying into big dips and selling into rallies. Sold almost everything I owned 10 minutes before the market closed today and now I'm in the cash is king mindset.

Hmm, if the S&P hits 1000, I don't think I will be able stop from jumping full force back into the markets.