dow up 400 points

[spanone]

www.nytimes.com

[kentuck]

1. A trillion dollar bailout works wonders with the market.

even if it is in Europe.

[spanone]

2. yep

[Warpy]

6. Happy days are here again

but the hangover is going to be a dilly.

[madokie]

26. It's so transparent, huh

We're being fleeced by our soon to be announced overlords. People better wake the fuck up and soon

[cbdo2007]

3. It's a thing of beauty *eyes begin to tear up*

Cha-Ching!!!

[Are_grits_groceries]

4. That isn't good IMHO.

I'm glad the market is recovering, but this drastic movement both ways is disconcerting to say the least.

I'll bet oil futures and other commodities that depend on oil in some way jump too.

[AllentownJake]

5. Volatility does little to instill confidence

A trillion dollars available to bankers to place bets will increase the markets for the short-term.

[Statistical]

7. The younger you are the more volatility you want.

Large moves down, say even 20% move downward won't materially hurt a young persons retirement value 30, 40, 50 years from now however a 20% move down will give them the opportunity to buy amazing companies "on sale".

Dollar cost averaging (investing regular amounts of money in fixed dollar amounts, say $1000 per month every month) gains more advantage with higher volatility.

As you get older volatility starts to become a mixed blessing and by the time you are a retired it is purely an enemy. However that is why asset allocation should change with age. More stock exposure when young, decreasing as you age.

[dmallind]

8. It doesn't matter how much sense that makes

It does not matter how many millions of retirees have funded and are funding their retirement that way. It's still a casino house of cards ponzi scheme bankster scam that will bring back a preindustrial age (that you are too blind to foresee unlike me) when it utterly collapses tomorrow....no tomorrow.....ok tomorrow....just watch it tomorrow.....you fool you just can't see - it will collapse tomorrow!!!!!!

[Statistical]

10. LOL. OK

[dmallind]

19. Sometimes, surely, the dripping icon is unnecessary....?NT

[Statistical]

22. Ouch.

Sadly many on DU have that genuine view. One would think /sarcasm would be unnecessary but compared to other anti-market posts it really isn't that out of line.

Still I feel silly. :)

[AllentownJake]

28. AIG is trading above 0 on the exchanges

The fact that government intervention into the markets has created major distortions isn't exactly tinfoil

:rofl:

[dmallind]

37. Hey that's a compliment to my satire. I'll take it ;) nt

[AllentownJake]

12. The EU just had to inject 1 trillion dollars of their citizens money to keep it going

:rofl:

Yeah it is a sound thing...

[dmallind]

20. Lemme see

No timeline on the collapse....check

No willingness to try and risk money by putting it where the mouth is....check.

Yep just one more constant doomer getting a stiffy every day with any twinkling hope that this one day they may be right, despite years of being utterly wrong day after day after day.

[AllentownJake]

21. If I knew when the Ponzi ends

I wouldn't be on DU...that is some bigtime insider information there.

Actually I was 100% correct. I said this Greek thing was going to be a giant mess and a big deal and blow up pretty badly in everyone's face risking the entire world financial system you happy thoughts crowd told me what an idiot and what a gloomer I was.

$1 trillion dollars..to save the world once again. Appears my track record is pretty good.

Now why would I place bets on things that I know will happen when some Central bank is just going to print a trillion dollars and cut spending on their own people. Seems silly to me. Knowing when the Central banks have to stop doing this is a very hard bet to place, but eventually they will have to eat the puke they are throwing out to the world.

My track record is great, how is yours doing?

:-)

Kisses, watch California...they are next.

[Are_grits_groceries]

9. I think this kind of volatility

is a little too much. Being in the market now is no guarantee of anything. All bets and rules are off. The 'fat finger of fate' or whatever proved that.

Even companies that are supposed to be stable can end up in some kind of trouble.

With this movement, people better know when to get in and out. I don't know who has their paw on that. A lot of people and brokers don't. Counting on the market even for the long term can be a very risky proposition with the global economy still rocking.

[Statistical]

11. Depends on what your time horizon is.

What does a 5% or 10% decline in a day mean if your time horizon is 2 decades out?

Nothing.

Without any volatility dollar cost average really doesn't provide much benefit (i.e. you don't get much advantage over investing $1000 a month for 3 months vs $3000 at once). More volatility and regular investments mean you buy less shares when stock prices are higher and more shares when prices are lower.

Lastly don't invest in the "market" invest in companies. I like "real" companies. Intel really makes a couple hundred million CPU a year, Boardwalk pipelines really moves millions of tons of natural gas a year, Vale mining really extracts tons of iron a year, first solar really sells GW worth of solar panels a year. I also look for high yielding dividend companies. 4%-6%. Very hard for a company to "fake" paying out cold hard cash every qtr for a decade.

[cbdo2007]

14. ha ha - coming from the guy who just bought 300 shares of BP for a possible 12%

gain over the next few months.

You could throw a dart today and hit a company that is up 5-6% just since last Thu/Fri.

[Statistical]

16. Only a small percentage of my portfoilio.

My largest "core" holdings tend to be large stable dividend paying stocks. Accumulate them on weakness. Sell covered calls against them. When you pick up 6% extra return from covered calls annually (while accepting that sometimes you will lose a monster move) and 4%+ dividends it is much easier to post a solid combined gain each year rather than trying to rely 100% on stock appreciation.

Of course regarding BP it is 500 shares (300 @ 52 and 200 more @ 48.50) you seem to ignore using options to hedge the position. Those $47.50 puts and $55 calls are nicely out of the money. Nothing better than selling risk to speculators who want it. It is unlikely BP will reach either $47.50 or $55 in the next 10 days meaning a good chance they both will expire worthless. May roll them out early to June put/calls depending on how quickly time value evaporates. Also I don't recall giving a target. I think it was you who said 12% over 3 months is a "poor" return.

[ipfilter]

31. Covered calls are a sound hedge and income opportunity.

Theta is the friend of the seller and enemy of the buyer. Every time I sell calls I sing "Time is on my side" in my head. They are almost like free money.

[Statistical]

32. Yeah I got no problem selling risk to someone else who wants to hang themselves with it.

Everyone once and a while they get lucky but most of the time far out of the money calls & puts expire worthless.

I am willing to trade a lottery ticket gain for regular consistent revenue stream. Funny thing is options are so misunderstood people think they are really risky. They can be but they can also be far more conservative than stocks.

[malaise]

13. At this rate hubby and I will lose our

pensions. WTF is going on?????

[Statistical]

15. Why would you lose a pension due to daily volatility in the market?

Pension funds tend to only have limited exposure to the "markets" the majority of the money is in corp bonds and treasuries. A good pension fund manager running a well run pension LOVES volatility. Why? He has millions of dollars in safe secure bonds/treasuries. They will pay out enough interest to cover current obligations. This gives him flexibility to buy companies (especially high yielding ones like Verizon) when market is very volatile and deals abound.

A good pension fund manager will be very selective and wait for the inevitable selloff to buy companies at attractive valuations thus boosting funds overall performance.

[Are_grits_groceries]

17. U.S. state pension funds have $1 trillion shortfall: Pew

http://www.reuters.com/article/idUSTRE61H13X20100218

Google pension funds and their are a shitload of articles about the trouble they are in. Their are a lot of funds with very poor managers apparently. Hmmmmmmmmmmmm.......

[Statistical]

18. Most of the shortfalls come from a much simpler reason.

Regardless of stock market fluctuations, pension funds were destined to fall down a budget hole, the non-profit research center found.

"Over the last 10 years, many states have shortchanged pension plans in good times and bad," said Susan Urahn, the center's managing director, who called the beginning of the century a "decade of irresponsibility."

State promises to put in $x each month and due to budget shortfalls they put in 60% of that. Do that for a decade and you get behind the 8-ball very quickly.

[kentuck]

23. But just like Greece is being asked to sacrifice...

The American people will sacrifice also. They will not asked. It will just happen.

[Statistical]

24. Or we could raise taxes and put politicians in jail who promise to fund a pension and then don't.

But that is just me. Same applies to corporations with unfunded pensions.

Your right though either taxes will go up or pensions will be cut. Unless we have some duper duper decade of stocks there is no other way to close the funding gap. I mean under funding a pension for a year adds up.

Imagine if you carried a monthly balance on a credit card of $1000 but you paid it off in fall. After a decade, no running balance (no shortfall). Now imagine you "underfunded" your payments each month. Put $1000 on a credit card a month but only paid down $600, do that for a decade. Digging out of that whole is tough.

Local/state govt dug a big grave here and there is no easy fix.

[kentuck]

27. Stocks will go down across the board...

As income declines for everyone. There will be less money to spend on consumer products. Our only hope is to get into some derivative business. The debt is master of us all.

[Change Happens]

25. Thank you President Obama for turning our economy around, creating more jobs!!!

Saving our country...

[NJmaverick]

29. +1

[AllentownJake]

33. LOL

This is reaction to a fucking bailout of the entire continent of Europe.

[Change Happens]

35. Oh yeah, which does not effect our markets or economy at all?

Or vice versa?

[NeedleCast]

34. Ugh

Obama doesn't get credit and shouldn't take the blame for brief periods of market volitility. He has little to no impact on it.

[Change Happens]

36. He gets credit for turning our economy around - BIG TIME!

[NJmaverick]

30. Still up over 400