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Bear Market Plunge: StockBlade Timeline Of Views For 2008

October 28, 2008 12:07 AM

As many of my readers know, I have warned, repeatedly, that the financial crisis was greatly understated 8 months ago, and most everyone was wrong. I also made the comment many times that “I was the most negative person alive on the U.S economy and the market - not named Peter Schiff”. Unfortunately my views have proven correct. While this site is intended to be a trading site, I periodically have given my views on fundamental issues regarding a stock and the economy.

Here is a summary of some of my posts this year regarding fundamental problems and that the market would ultimately go lower.

March 11th: “Fed Increases Liquidity - Massive Short Covering Rally”. I make the case that it was a “fake rally orchestrated by the fed” and the facts had not changed for financials and did not believe in it.

March 20th: “Don’t Ignore History”. I make the case that the market was being driven higher by inflation and paper and this never had happened before. Because of this I was concerned about an eventual market implosion.  I also reiterate that the market would go lower.

March 25th “Cramer Is Wrong on Housing - Again”. I state that “Cramer is dead wrong” on FNM and housing and the sector would go far lower and the rally was short covering and should be sold. FNM was about $35 and the homebuilder ETF was about $24. They are now .95 cents and $13.79 respectively.

March 29th “Gold Stocks Are Trades Not Investments” I warned that these stocks were being driven by euphoria in gold, and should not be consider investments at those levels as they “could easily drop 50% or more once the euphoria ends.” AEM was over $70 and has been cut in half since.

March 30th: “If You Think We Are In A Bear Market”. I made the case in this article to “sell the rips” because I believed any rally would not last.

April 25th:  “Market Strength Surprising”. Post is about the fact that the $600 rebate checks will do nothing and the market was ignoring the facts and was wrong and to take profits when you can.

April 26th: Financials: Very Skeptical Long Term” The post says that “there is massive short interest in financials - for good reason”.

May 11th: Mortgage Crisis Is Not Over Like TV Analysts Say - It Hasn’t Even Begun.” Post goes into why the mortgage crisis will get worse, not better, as all the talk was at the time.

May 26th: Buffett Says Recession Will Last Longer Than People Realize”. I agree with Buffett and outline two possibilities. That the recession would be obvious and the markets would go far, far lower rapidly or that we would get “bullfrogged”, basically that the markets would gradually drift lower and lower and lower but never a severe one time plunge.

June 7th: “Current Views”. Post outlines views on economy and the market as negative to very negative.

June 9th: “Financials near March Low”. Post outlines that financials are a trade, nothing more, and the problems would get far worse and that “there are billions and billions of bad debts hiding on balance sheets”.

June 10th: “Bernanke: Downside Risks Have Faded”. I pointed out that I “believed this - like not at all.” and the risks remained or were growing.

June 24th: “Energy And Commodity Stocks Are Trades - Not Investments”. Post outlines the bubble in commodities and “if you are investing in these here for the long haul - you are a fool.” Rather harsh, but was trying to make it clear my position that both would go far lower over time and to ignore the hype that they were going higher. The energy index was near the all time high then and is down 50% since that post.

I could outline other posts, but I think people can easily see what has been my point of view - that everyone was WRONG on the problems coming and the market. I wish everything was fine, and the markets and economy were steadily improving as it would be very easy to help people money on the long side. But that was not the case and I could not ignore what I believed to reality. Unfortunately, virtually all of my views have been proven correct, both with the economy and the markets.

It is very difficult to predict exactly when the markets will understand reality as i have also said that the markets can and will be wrong for a very long time. If i had known that the market would finally understand the problems I would have simply shorted the market. But again, as 2000 pointed out, the market clearly is not an efficient mechanism, regardless of what textbooks teach. Not even close. It is fear and greed.

Written by Tom@StockBlade.com · Filed Under General Market Comments 

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