The ongoing financial turmoil and financial discussion thread

[Dan02]

Originally Posted by Bertuzzied

$43million for the 649 jackpot tonite. Every good financial plan should have a "win the lottery" section in it.

I do, unfortunately there is only 2 items, hookers and blow.

[Phanuthier]

Sort of pathetic, sort of funny, after $45B of US tax payer dollar bailouts, Citi buys a snazzy new corporate jet for $50M.

http://www.forbes.com/feeds/afx/2009...fx5964993.html

[macker]

Originally Posted by Phanuthier

Sort of pathetic, sort of funny, after $45B of US tax payer dollar bailouts, Citi buys a snazzy new corporate jet for $50M.

http://www.forbes.com/feeds/afx/2009...fx5964993.html

This guy went all in on the markets collapse. Sort of pathetic, sort of funny, sort of clever I guess http://www.cnbc.com/id/28814840 These types of bottoms are where billions not millions are made! Not only in America!

[macker]

http://www.bloomberg.com/apps/news?p...OSw&refer=home

Obama will likely need to ask Congress for more money to recapitalize banks, as much as $1 trillion on top of the roughly $300 billion remaining in the current Troubled Asset Relief Program, according to an estimate by former Federal Reserve economist Ward McCarthy. That will be an even tougher sell for the new president than the stimulus plan, which is headed for a Senate vote this week after passing the House with no Republican support.

WOW! 1 Trillion!

[Glenflame]

Originally Posted by macker

http://www.bloomberg.com/apps/news?p...OSw&refer=home

Obama will likely need to ask Congress for more money to recapitalize banks, as much as $1 trillion on top of the roughly $300 billion remaining in the current Troubled Asset Relief Program, according to an estimate by former Federal Reserve economist Ward McCarthy. That will be an even tougher sell for the new president than the stimulus plan, which is headed for a Senate vote this week after passing the House with no Republican support.

WOW! 1 Trillion!

I read an insider news that the total amount of CDS is up to 6.3 trillion in total. 250 billion is only a hook for the downpayment for the entire amount.

[Ronald Pagan]

Markets may reach a 12 year low.

Claeren looking wise.

http://business.theglobeandmail.com/...alEvents2/home

[Sylvanfan]

This week has been a real blood bath in the Stock Markets. Looks like I'll be back in my Mom's basement by May.

[pepper24]

Be fearful when others are greedy and greedy when others are fearful. If you have money on the sidelines it might be a good time to get in the game.

That being said, don't put all your money in at once. Do dollar cost averaging where you buy pieces over a period of time.

[pepper24]

^ Also, if you need this money over the short term (5 years or earlier) I'd keep it in high interest savings account instead. Getting in the stock markets now should be long term as this mess could take a while to correct.

[macker]

Originally Posted by pepper24

Be fearful when others are greedy and greedy when others are fearful. If you have money on the sidelines it might be a good time to get in the game.

That being said, don't put all your money in at once. Do dollar cost averaging where you buy pieces over a period of time.

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Even Buffett is fearful here and just sold half of his position in J&J
The root of the problem continues to be housing and there is more to come. Lumber futures will let you know when we are comming out of this mess. Until then if you want to short America buy gold You can no longer afford to buy and hold this market. http://www.nytimes.com/2009/02/07/bu.../07charts.html
I wonder what the next 10 years will look like! Maybe Harry Dent has been right all along! Dent recently said "this level of stimulus is at the point that it's like taking a bottle of Viagra and nothing happens.

[Daradon]

Holy smoke, looks like the Dow might break the 7000 threshold (In the wrong direction)

Haven't hit bottom yet.

[macker]

Originally Posted by Daradon

Holy smoke, looks like the Dow might break the 7000 threshold (In the wrong direction)

Haven't hit bottom yet.

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Nope but we are getting closer everyday! The market is ignoring :
1. The magnitude of the monetary & fiscal stimulus
2. The consumer tax cut because of lower energy prices
3. Improving liquidity
4. The low cost of credit
The media will sooner or later run out of bad news...The Fud Factor is trumping items 1-4 right now...

[Nancy]

Originally Posted by macker

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Nope but we are getting closer everyday! The market is ignoring :
1. The magnitude of the monetary & fiscal stimulus
2. The consumer tax cut because of lower energy prices
3. Improving liquidity
4. The low cost of credit
The media will sooner or later run out of bad news...The Fud Factor is trumping items 1-4 right now...

The thing that depresses me is that once we do eventually get this crisis behind us, we will be faced with the task of repaying the massive government debt that has accumulated. Which means, in the long run, taxes will be going up substantially. As such, I'm even beginning to wonder if RRSP's make sense (they only make sense if you retire at a lower tax rate than you are in today) or whether maybe the TFSA is a better option.

[flylock shox]

Alright kids. Let's say I'm a dude who's looking to max out his RRSP contributions for last year (relatively high income), anticipating an extended period of unemployment beginning some time this year (relatively low income). Let's also say I'm looking at a TFSA.

Where do I, as a dude, invest my RRSP money? How about the TFSA money?

This is all, of course, totally hypothetical.

[Glenflame]

Originally Posted by Ronald Pagan

Markets may reach a 12 year low.

Claeren looking wise.

http://business.theglobeandmail.com/...alEvents2/home

If you know BOA, CITI, etc need 4xx billion more dollar to be alive, the market is in normal performance.

[simmer2]

Originally Posted by macker

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Even Buffett is fearful here and just sold half of his position in J&J
The root of the problem continues to be housing and there is more to come. Lumber futures will let you know when we are comming out of this mess. Until then if you want to short America buy gold You can no longer afford to buy and hold this market. http://www.nytimes.com/2009/02/07/bu.../07charts.html
I wonder what the next 10 years will look like! Maybe Harry Dent has been right all along! Dent recently said "this level of stimulus is at the point that it's like taking a bottle of Viagra and nothing happens.

http://blogs.wsj.com/health/2009/02/...googlenews_wsj

There's an article about Buffett selling his position; he only sold health-care companies not other ones. We don't know his reasons, he isn't necessarily fearful.

[MoneyGuy]

Originally Posted by flylock shox

Alright kids. Let's say I'm a dude who's looking to max out his RRSP contributions for last year (relatively high income), anticipating an extended period of unemployment beginning some time this year (relatively low income). Let's also say I'm looking at a TFSA.

Where do I, as a dude, invest my RRSP money? How about the TFSA money?

This is all, of course, totally hypothetical.

If your income puts you in the 32% tax bracket in Alberta or higher, the RRSP is the better choice. Lower income makes the TFSA better. I've seen a federal gov't study that says this, and I agree with it.

I think the economy will start to improve near year end. The market tends to lead the economy by about half a year. I think young folks with lots of years who are talking GICs or going into cash for a couple of years are crazy. When the market recovers, it tends to make up a third of what was "lost" in the downturn within the first 40 days of the recovery. I don't think the recovery will happen immediately but I would DCA in over 2-4 months, so that in four months your fully invested.

Hell, I'm in my 50s so theoretically should be more conservative, but I absolutely feel that in a couple of years we'll recognize the wonderful opportunity that existed right now. My RRSP contrbutions right now (I do these monthly through the year) and my TFSA contribution are going into equities. And I'm probably way older than you are.

That's my two cents.

[flylock shox]

Originally Posted by MoneyGuy

If your income puts you in the 32% tax bracket in Alberta or higher, the RRSP is the better choice. Lower income makes the TFSA better. I've seen a federal gov't study that says this, and I agree with it.

I think the economy will start to improve near year end. The market tends to lead the economy by about half a year. I think young folks with lots of years who are talking GICs or going into cash for a couple of years are crazy. When the market recovers, it tends to make up a third of what was "lost" in the downturn within the first 40 days of the recovery. I don't think the recovery will happen immediately but I would DCA in over 2-4 months, so that in four months your fully invested.

Hell, I'm in my 50s so theoretically should be more conservative, but I absolutely feel that in a couple of years we'll recognize the wonderful opportunity that existed right now. My RRSP contrbutions right now (I do these monthly through the year) and my TFSA contribution are going into equities. And I'm probably way older than you are.

That's my two cents.

That's very helpful. I was looking just to invest in very short term GICs just to make the 60 day contribution deadline for 2008, then change the nature of the investment afterwards. The TFSA I reckoned, would just be fun to play around with, since it's relatively small (and not time-sensitive like the RRSP contribution).

[macker]

Originally Posted by simmer2

http://blogs.wsj.com/health/2009/02/...googlenews_wsj

There's an article about Buffett selling his position; he only sold health-care companies not other ones. We don't know his reasons, he isn't necessarily fearful.

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Right. He increased his stakes in these positions late last year so I was surprised to see him basically reverse course based on his usual long term holding history so maybe even Warren is trading around in this market now. He likely isn't fearful but it is very uncharacteristic of him. On the other had George Soros recently doubled his stake in Potash Corp to become the 8th largest shareholder so at least one of the big boys sees this as a buying opportunity.

[Glenflame]

Why nobody mentioned Buffett is getting caught by buying Bank of America, GE, and etc.?

He paid 4-6 times of current value of Bank of America.