STOCKS CRUSHED: Dow -220
Which won't come as a surprise to SAI readers, who have been prepared for lurches downward since last summer.
Hard to find much to like, with oil at $100, housing in full tank, and the Fed trapped between a worthless dollar and a sputtering economy (but no mystery which exit they'll take--Helicopter Ben to the rescue). The good news is that lots of folks are starting to see the glass as half-empty.
Depressed? Take a look at Cablevision (CVC). Berstein's Craig Moffett thinks Dolan family engineering will drive it to $100 in a few years. Or Amazon, which Citi's Mark Mahaney just upgraded on account of sandbagged guidance and international exposure. We're not sold on either analyst's logic, but any reasonable-looking port in a storm.
See Also:
Stock Plunge: Correction or Crash?
How Bad Could the Market Crash Get? Very
Recession Watch: We're Probably Already In One
Hard to find much to like, with oil at $100, housing in full tank, and the Fed trapped between a worthless dollar and a sputtering economy (but no mystery which exit they'll take--Helicopter Ben to the rescue). The good news is that lots of folks are starting to see the glass as half-empty.
Depressed? Take a look at Cablevision (CVC). Berstein's Craig Moffett thinks Dolan family engineering will drive it to $100 in a few years. Or Amazon, which Citi's Mark Mahaney just upgraded on account of sandbagged guidance and international exposure. We're not sold on either analyst's logic, but any reasonable-looking port in a storm.
See Also:
Stock Plunge: Correction or Crash?
How Bad Could the Market Crash Get? Very
Recession Watch: We're Probably Already In One
Hear you on the broken clock thing, but my bias still downward. I just can't shake the bear outlook based on a century's worth of cyclically adjusted P/E. It may be that things are different this time, but if there's one lesson I learned from the last bubble, it's that they probably aren't.
Sorry to hear Wall Street still bullish. Thought everyone was coming around (which would have been a nice bullish sign).
Unfortunatley, that's still not a contrarian stance, Henry.
Every major wallstreet strategist sees the S&P higher by the end of the year, per Barron's (http://online.barrons.com/article/SB119768725735731187-search.html?KEYWORDS=2008+outlook&COLLECTION=barrons/6month -- might need sub). In fact, 8 of the 12 see the S&P as at least 10% higher from the end of 07.
You will be right, like a stopped clock. On August 16th you panned the Market and internet stocks.
Internuts are much higher than they were when u said...
One thing we do know: Based on correctly calculated long-term valuation trends (cyclically adjusted P/E), the stock market is still extremely expensive (close to the peak levels of 1929, 1966, and 1987, and only below the all-time peak of 2000). I expect that this will eventually revert to the mean, and that one of these days we will see the "start of a bear market" that could take us below the 7700 trough on the DOW in 2002. This could be it (and if it is, this is just what it will look like). And given the housing market, credit crunch, oil prices, etc., it's not hard to see how we would get there. But anything is possible, and long-term valuation trends are nearly useless for near-term timing calls.
Why is this relevant for Internet companies? Because the direction of the stock market is important for those who run both public and private firms, whether it seems so or not. Crashing markets often herald crashing economies, which lead to reduced consumer spending and advertising revenue. And crashing markets also throw buckets of cold water in the face of those who were just gleefully distributing angel and VC cash.
http://www.internetoutsider.com/2007/08/about-that-cras.html
Make no mistake, the goldilocks economy is resilient, and the American Consumer is indefatigable. We will weather this storm with yet more inventive credit instruments, robust productivity increases, and continued buoyant corporate profits kept afloat by international exposure and the burgeoning global economy.
Remember boys and girls,
Free market capitalism is the best path to freedom and prosperity.