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Some were expecting the multi-billion bailout plan to sustain the
market
for one more day, since the negative reading last Friday had subsided
a bit from that of Thursday.
But clearly the market was not bullish, but waiting to see what effect
the big bailout plan would have. On Friday, many street-savvy,
common-
sense traders probably kept to the sidelines. Now from Monday's
action
we know that public confidence simply is not there, not in the bailout
plan,
and not in the people entrusted with its administration.
Tuesday (Sept. 23, 2008)'s market action confirms continued
bearishness.
FORECASTS ON TICKER SYMBOL: SPY
SYMBOL, DATE, PRICE, FORECAST, PERCENT
SPY, 20080922, 121.1000, -3.7062, -3.1 <- Strong SELL
SPY, 20080919, 124.5300, -1.6718, -1.3 <- Less negative
SPY, 20080918, 122.9000, -3.2546, -2.6 <- SELL
SPY, 20080917, 116.7900, 4.4816, 3.8 <- Strong BUY
SPY, 20080916, 122.6400, 0.9222, 0.8
SPY, 20080915, 119.3700, 1.6309, 1.4
SPY, 20080912, 125.9200, -2.2014, -1.7 <- SELL
SPY, 20080911, 125.3600, 0.6379, 0.5
SPY, 20080910, 123.5400, 0.9877, 0.8
SPY, 20080909, 123.2900, -0.4754, -0.4
SPY, 20080908, 126.9700, 0.3500, 0.3
SPY, 20080905, 125.8500, 1.0112, 0.8
SPY, 20080904, 123.5000, 2.6908, 2.2 <- BUY
SPY, 20080903, 128.0400, 0.9324, 0.7
SPY, 20080902, 128.0200, -0.0445, -0.0
SPY, 20080829, 128.6500, -1.0711, -0.8
SPY, 20080828, 129.9800, -2.1714, -1.7 <- SELL
[Above forecast figures FYI only, not advice or recommendations.]
It now appears the market psychology is weaker than expected, since
the market fell sharply on Monday, Sept. 22, 2008. Although, based on
the above readings, it should not have been too much of a surprise.
It appears that the big bailout plan will not trump the fundamentals,
even
if it should impact the short-term negatives for a day. The
confidence is
clearly sagging, and Monday's sharp decline shows that the "Confidence
Game" may not work now nor in the future as well as it has in the
past.
This suggests that investors have no faith that the financial crisis
is even
temporarily relieved by the bailout plan, which seeks "non-
reviewability"
when the lack of review and oversight was the cause of the current
crisis
in the first place. The perpetuation of unbridled and unreviewable
action
is the ROOT of the current financial ills -- and that has NOT changed
at
all, and instead is mushrooming.
The arguable uncertainty is the degree the bailout plan, when
approved,
will impact on the market, assuming positively (though that assumption
may not be valid, as it may have been partially or fully discounted).
Of course, the lack of review and control over the bailout plan
arguably
is a dangerous perpetuation, if not expansion, of "business as usual"
on Wall Street, and could reasonably be considered highly toxic and
bearish in Joe Public's mind. There was, and still is, NO
accountability.
NO true reform, but only MORE of the SAME will NOT save the market.
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Fact Check: Henry Paulson is a Republican
Fannie Mae (FNM) and Federal National Mortgage Association (FNA)
Why Congress Objects To The Bailout Plan
Interesting--John Meriwether's hedge fund is.....
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