Round 2: S&P goes to France

[Mp808]

10/8/2011
@10:25 pm

Dow Jones: 10803.27 (-436.50, -3.88%)
CAC (France): 3011.85 (-164.34, -5.17%)
NYMEX WTI Crude: 80.28 (+0.98, +1.24%)

Ok, this is getting ridiculous. I think S&P is on a power trip. I wouldn't be surprised if someone on the inside made a lot of shorts last week.

Although I'm not that confident on the Thai economy, I must say that Q2 earnings are strong and have surpassed my expectations.

เขียนเป็นภาษาไทยดีกว่า เดี๋ยวไม่มีใครมาอ่าน

นี่คือคำถามที่ผมได้มานั่งถามตัวเอง...

Question: ฝรั่งเศสเดือนที่แล้วกับวันนี้แตกต่างกันมั้ย?
Answer: ไม่เลย นอกจากมี S&P มาบ้าอำนาจ

Q: ฝรั่งเศสจะ default มั้ย?
A: ถ้า Greece, Ireland, Portugal, Spain, Italy ยังอยู่ได้ ฝรั่งเศสก็อยู่ได้

Q: Is this a crisis?
A: No, it's a panic. These countries have been like this for years.

Q: พรุ่งนี้ SET จะเน่ามั้ย?
A: Most likely.

Q: Justified?
A: Not at all.

โปรดดู Debt to GDP ratio ใน link: http://en.wikipedia.org/wiki/List_of_so ... ublic_debt
มันของ 2010 แต่ผมว่ายังใช้ได้

What's next? Singapore? (STI: 2821.09 (-62.91, -2.18%))
Come on S&P, give me a break. Unless they actually defaulted, we are not going into another global recession.

I am not trying to push my own opinion or give any hope to anyone. Please use your own judgment.

[multipleceilings]

^ lmao, i hear you but this is how the market is and always will be

You see, the koreans are smart enough to ban the short mechanism from their market for 3 months

S&P is probably pissed they got caught for miscalculating the deficit by 2 trillion US, now they're taking it out on the world.

There are manipulators out there..... coupled with retailers who on their own just always xxxx things up with their emotions anyway

a lot of people know how ridiculous these credit rating agencies are but apparently not enough...... , there you go, look at the markets

let me quote this from bloomberg

S&P Scrutiny
In 2009, when S&P reaffirmed the U.S.’s AAA rating, analysts led by Nikola Swann wrote that the ratio would approach 90 percent by 2013.

“The old fashioned ratings agencies where humans make the decision to downgrade are always wrong,” Christopher Whalen, managing director at Institutional Risk Analytics, said yesterday in a telephone interview.

S&P, Moody’s and Fitch came under scrutiny for ratings of financial products linked to subprime mortgages after losses and writedowns by the world’s biggest financial institutions reached $2.1 trillion.

The Financial Crisis Inquiry Commission called S&P and Moody’s “key enablers of the financial meltdown” in its January report. In April, a Senate panel said that the rating companies engaged in a “race to the bottom” to assign top grades on mortgage-backed securities in order to win fees from banks.

‘Last People’
S&P kept an A- rating on Iceland until October 6, 2008, when the country’s government was forced to guarantee all domestic bank deposits after its currency plunged. The company reaffirmed its AAA rating for Lehman Brothers Holdings Inc.’s financial products unit on Sept. 12, 2008, three days before the bank failed. It downgraded Bear Stearns Cos. to BBB on March 14, 2008, two days before JPMorgan agreed to buy the failing securities firm.

“There is no reason to take Friday’s downgrade of America seriously,” Nobel Laureate Paul Krugman said in a New York Times column. “These are the last people whose judgment we should trust.”

While S&P cut Japan’s credit rating to AA- in 2002, the country has no difficulty borrowing. Japan’s 10-year notes yield 1 percent, compared with 2.41 percent for AAA rated German bunds, Bloomberg data show.

“In those rare cases where rating agencies have downgraded countries that, like America now, still had the confidence of investors, they have consistently been wrong,” Krugman wrote.

[Mp808]

For a more complete picture, please also look at external debt: http://en.wikipedia.org/wiki/List_of_co ... ernal_debt

@multipleceilings
Good to know someone else is not buying into this nonsense.
I agree that S&P is pissed for being criticized and they're taking it out on the world like an angry child.

I mean, high debt is not healthy by any means, but to have these downgrades right now seems almost like a strategic trading move to me.

Pull out your dusty Financial Governance books people. Read up on Moral Hazard and Conflicts of Interest.
Something is gotta be happening behind the scenes on this one.

Institutions are scaring the crap out of people with their selling too. Now, it seems like they're gonna be confused too. For example, notice at the end of today's trading session, you see a lot of synchronized buys, which, to me, signals institutional buying, even though they've been selling all day. So it was a bear trap to kill all the scared people. But since Europe and America are doing bad today, Institutions are gonna be dumping it tomorrow morning ATO and there's nothing small investors can do about it except wait it out.

[multipleceilings]

i typed up a long response and accidentally closed the damn window!!. fuggit...

yeah...in essence i was going to say

first off, those that "know" 2008 is different to this, and know that what the hell is going down does not really pose any drastic economic threat..... including us, have things to say coz we think this sell off makes no sense. way overblown out of proportion

but those that dont know ... way more in numbers... dont know in terms of money but enough to cause significant affect on the markets when manipulated

the only thing that is identical to 2008 is...........................yes, u got it right, us humans

1. most of us humans didnt really understand what happened in 2008, most of us dont understand what the hell is happening now, and what the real "net effect" is
2. most of us usually never learns, and keep making mistakes in life all th time, not just in the stock market
3. knowing number 2, most of us still dont want to learn and up our skills
4. panicking is basically following what others do, it just shows our nature, when we dont know or dont understand something, WE follow, copy, or imitate......
5. us humans dont really want to buy anything when the markets are like this, and we just want to sell, when there is hella thin bid, and everyone wants to sel, the game we play is called, "WHO GETS THE SELL FIRST WINS!" thus, the lightning-fast decline.
6. one major reason is also greed, most of us wants to sell now so we can buy lower! if possible, we want to buy at the lowest point coz it makes us feel good. but most of the time, we end up not being able to buy at the lowest, after we buy, the price goes down even more! so we go back to number 5, then after a while we will proceed to number 6, and possibly continue this loop for eternity.
7. us humans are just annoying !!

there are a few things i would like to say other than that, but im good....

now you see, this whole n.korea vs. s.korean thing just popped up on bloomberg. Are they gonna decide to play on that as well now?

[Mp808]

Well S&P came out and "reaffirmed" France's ratings according to Bloomberg. Good to hear them coming to their senses. Now it's the investors' turn.

Whatever happened to "the market never discounts the same thing twice"? The Europe fear has been discounted at least five times already. It's the same old stuff recycled and repackaged and sold as new.

The Koreans are at it again huh. I wonder how long they're going to keep fighting until they realize that all it does is bring pain and death.

But as you said, it's a vicious cycle. Indeed. Allow me to describe my own impression of "Mr. Market".
Mr. Market is an extremely paranoid person suffering from bi-polar disorder with an addiction to worry. As I read these topics on Thaivi, I see it. One comment I saw about a topic on whether or not you are afraid right now basically says,

"I'm not afraid of [Mr. Market], but I'm afraid that you are afraid." (I'm paraphrasing here)

I think this comment is very true and a very powerful one. It basically sums up investors' mindset. Investors find something to worry about all the time. And when they are not worried, they begin to worry about why they are not worrying. Again, vicious cycle. I just started reading Soros' "Alchemy of Finance" about his famous reflexivity concept and it's very apparent right now. And that phrase above basically sums it up. As Soros calls it, "initially self-reinforcing, but eventually self-defeating processes."

Hope all goes well.

[pdGrff]

1. most of us humans didnt really understand what happened in 2008, most of us dont understand what the hell is happening now, and what the real "net effect" is

yeah i have been trying my a** of to just find out what the heck is happening in the US. Most of the news report the consequences and downsides of this downgrade but they never dare to reveal what has caused this event, or at least not well-rational enough for me to accept.
as for myself, there can't be a real recession if not for a war
Thank you for bringing this up khun Mp808

[1154]

France’s AAA Credit Affirmed by S&P, Moody’s

By John Detrixhe and Anchalee Worrachate - Aug 10, 2011 11:06 PM GMT+0700

http://www.bloomberg.com/news/2011-08-1 ... -rout.html

[multipleceilings]

Well S&P came out and "reaffirmed" France's ratings according to Bloomberg. Good to hear them coming to their senses. Now it's the investors' turn.

Whatever happened to "the market never discounts the same thing twice"? The Europe fear has been discounted at least five times already. It's the same old stuff recycled and repackaged and sold as new.

The Koreans are at it again huh. I wonder how long they're going to keep fighting until they realize that all it does is bring pain and death.

But as you said, it's a vicious cycle. Indeed. Allow me to describe my own impression of "Mr. Market".
Mr. Market is an extremely paranoid person suffering from bi-polar disorder with an addiction to worry. As I read these topics on Thaivi, I see it. One comment I saw about a topic on whether or not you are afraid right now basically says,

"I'm not afraid of [Mr. Market], but I'm afraid that you are afraid." (I'm paraphrasing here)

I think this comment is very true and a very powerful one. It basically sums up investors' mindset. Investors find something to worry about all the time. And when they are not worried, they begin to worry about why they are not worrying. Again, vicious cycle. I just started reading Soros' "Alchemy of Finance" about his famous reflexivity concept and it's very apparent right now. And that phrase above basically sums it up. As Soros calls it, "initially self-reinforcing, but eventually self-defeating processes."

Hope all goes well.

1. Yeah, its just how bloomberg makes money. These headlines and stories sell. Everyday, they have 2 sets of articles on hand. One for when the market is good, one for when it's bad. You see a lot of switch up between good and bad news when the market swings between + and - . personally, its ridiculous to me. facts are facts...

I stopped taking them seriously a long time ago. but it doesnt mean i ignore it cause' we all should be aware of what type of info the crowd is exposed to.

2. Exactly, and that also happens because what is in the head is not in line with what "really is". The truth in its entirety remains the truth no matter how it is perceived. (According to us VI's, the truth is the fundamentals, under the condition that positive business performance to price relationship still prevails, we're okay) Anyway, problem is most people are too damn 'falsely perceptive' ....... they don't understand anything much, worst of all their own self, and they let their heads take them to places, and they aren't even aware ..... hence, the vicious cycle...... lack of awareness.... hell, lots of people are aware but they can't do nothing about it or don't know what to do..... so yeah....

All in all tho, all we can do is realize that its the nature of the market, that's just how things operate, just part of the game. So as long as business operating profitability and good cash management still have a positive correlation with share price, I guess we're good.

[multipleceilings]

1. most of us humans didnt really understand what happened in 2008, most of us dont understand what the hell is happening now, and what the real "net effect" is

yeah i have been trying my a** of to just find out what the heck is happening in the US. Most of the news report the consequences and downsides of this downgrade but they never dare to reveal what has caused this event, or at least not well-rational enough for me to accept.
as for myself, there can't be a real recession if not for a war
Thank you for bringing this up khun Mp808

I guess a lot of us see as well how ignorant people are

Yeah, you won't find anything out no matter how hard you look because the world we're living in is always in a "continuous" state. There are too many factors, its impossible to track down the actual origin. What you want to look for most likely is the "turning point" or the "significant event" that causes everything. This time round, it's most likely the S&P downgrade move...unfortunately, we cannot know more than that..basically we dont know sh*t....so yeah, tahts about it for the origin...... as for the outcome, seriously, no one really knows the net effect, all we have are assumptions based on our knowledge and experience, if A then B, X then Y etc etc.. .. People that think they know or is perceived to know better say this and that, and in the process, those who can't think and have nothing to say will just listen, and most likely when that something is perceived as "bad" ... .... yes, time for those who can't think to panic

want proof? we have always been wrong with our predictions, 2008 proved itself. We were wrong thats why we didnt see the crisis coming (with or without manipulation, if we didnt see it coming, we didn't), again we were wrong, thats why the market came back up in a very resilient manner. There is no ultimate truth out there.. i call these money market games the "created reality".... well, except one thing, fundamentals of the smallest unit in the stock market, the companies themselves. It's probably the only thing that's not as distorted, if you take the stock market away from the companies (basically we're talkin about unlisted companies) you would only invest in those that make you money, the 'sense of wealth' is very clear....with the market in the picture and the way it works, the mechanisms etc. the 'sense of wealth' has been madly diluted. Yeah, there is no hope, we set this game up ourselves and we set ourselves out to ruin, ourselves... lol....

Global scale information manipulation within these free markets is one other thing that is probably the scariest. There is just way too much to say... i could go on for days seriously... In short, the ultimate factor that enables manipulation to succeed everytime without fail......is human emotions coupled with insufficient logic and knowledge

Also as long as these derivatives exist, manipulation will never stop..way too many loopholes...the shorting mechanism for instance has completely lost its purpose as a tool to hedge against business cost.......................

As long as people there is a mechanism that allows people to benefit at someone elses loss and suffering...... this cycle wont end....