Is a Crash Coming?

August 15, 2010 by  
Filed under Investing

I can’t add much to a recent article from the Wall Street Journal. It contains a list of ten reasons why the market may due for another a big drop. They are reasons based on logic, not hysteria.

I am growing more cautious. A few weeks ago I placed stop orders on our major retirement holdings. I think I’m going to increase the stop price.

I encourage you to read the article and make decisions for yourself. In these troubling economic times, inaction due to inertia is not a decision.

Here is the link: ROI: Is a Crash Coming? Ten Reasons to Be Cautious

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23 Responses to “Is a Crash Coming?”
  1. MasterPo says:

    1) It’s about time you took this stance Mr. TML! I’ve only been saying it for months already! Welcome aboard. Better late than never.

    2) Read that article when it came out. On the whole I agree.

    3) This crash will be worse than anything ever seen before, for the simple reason – the country is FLAT BROKE!!! With a $13 TRILLION dollar deficit there just isn’t the money to pump in to ‘stimulate’ and bailout as already done.

    4) It is the Cloward–Piven strategy at work. Yes, 1+1 still equals two.

    5) Hope you increased your physical gold holdings – and if you think I’m just a nut then ask yourself: Why is the government now going to track gold purchase and sales with 1099’s???

    6) Ever wonder what it was like living in Roman at the final days of the empire? We are all about to experience it. G-d help us all! :-(

  2. Rob Bennett says:

    I believe that we need one more crash to overcome the effect of the millions that The Stock Selling Industry has spent promoting Buy-and-Hold. Once we get to a point where we are all talking about more realistic investing strategies, I expect the economy to take off like we have never seen it take off before.

    My fear is that the next crash would put us in the Second Great Depression. We need something scary enough to get people to open up to alternatives to Buy-and-Hold but not bad enough to put us in the Second Great Depression.


    • MasterPo says:

      WSJ wouldn’t show the whole artcile w/o subscribing but I get the drift. Heard it before and agree.

      Not sure what is worse: What the author says or the comments left (i.e. how few people seem to get it).

  3. MasterPo says:

    Rob – That has to be a joke. (Don’t quit your day job)

  4. Rick Beagle says:

    It is unfortunate that tried and true efforts are being ignored in favor of yet another round of “tax cut” mania (cut taxes and increasing spending always works eh?). Again, the people who bring you these predictions and their predictable solutions have been wrong consistently for a number of years.

    My prediction, if the Republicans retake any house, and if the Dems continue to be wusses when it comes to the economy (seeking bipartisanship is a joke), we will dip, and dip hard. It would appear that certain people have a vested political interest in seeing a collapse, and have thoroughly convinced the unwashed masses to vote against their own self interests.

    Point in case, who really thinks the poorest of the poor (illegal aliens) are to blame for a) loss of jobs; b) health care crisis; and c) sorry state of our economy? The shell game for fools.

    Truly sad.
    Rick Beagle

  5. MasterPo says:

    Yea Ricky.

    Tried and true.

    Worked real well for the Weimar Republic.

    • Rick Beagle says:

      So explain to me how in your household cutting your income while increasing your spending helps?

      It isn’t a trick question, or even that complicated, but alas, the right wing still thinks they have the magic bullet for our economy (despite YEARs of data debunking their myth). But you go ahead po, vote for another round of cuts for the wealthy, and see how that works out.

      Rick Beagle

  6. MasterPo says:

    MY household would NEVER do that.

    But government does it all the time.

    But unlike MY household (and yours!) we can not simply *demand* more $$$ from our employers and those around us while government can via taxes.

    Tell me Ricky, how many “poor” people do you know with employees?
    Does the person who signs your pay checks make more or less than you do?

    • Rick Beagle says:

      “Tell me Ricky, how many “poor” people do you know with employees?”

      Tons. I will leave that for your little brain to figure out…. But if it helps, meritocracy is a good word to to mull over.

      “MY household would NEVER do that.
      But government does it all the time.
      But unlike MY household (and yours!) we can not simply *demand* more $$$ from our employers and those around us while government can via taxes.”

      And unlike your household, the government is forbidden from competing against private businesses to fund themselves. So they encourage people to create a profit, and then tax them. For those that are lucky enough to make over a million a year, the tax rate has been dropping for quite some time with hopes of somehow trickling down, but all we have to show are class wars, destruction of the middle class (rethugs turned down tax breaks and other positive things for small businesses by the way), and undue influence of our political system (again).
      The question is how do you NOT see this? You will point at the libs but the libs did not create, support, or endorse this… that would be the conservatives. The very things that the tea baggers cry about, are the very things their own party did to them, and continue to do to them. It is mind boggling how stupid a whole subset of our population can be.

      I noticed that you still have not explained to me how your party plans to support these tax breaks, increase defense spending (including NASA), and balance the budget? Strip mine social services again I suppose, since that, in your mind is really what is sucking up our money. Look at a pie chart provided by an independent source.

      Rick Beagle

    • Jack Clark says:

      Trust me Po it pains me to say this but, the Beagle is actually on to something.

      It really is put up or shut time from you on your crazy right wing crap.

      The government has a spending problem no doubt. But that has been perpetuated by both parties over the past last thirty years and by both parties when in control of Congress over the last thirty years.

      So while Rush, O’Reilly, Beck and all of the rest of the Right Wing talking head tools keep spouting their vitriol that you apparently drink up daily, there is one thing that seeming you never discuss and always run away from.

      Where are the ideas from either you or your party to fix things?

      Instead of being the party of “No” on all ideas good or bad just because they may come from somewhere other than the extreme conservative wing of the GOP, why can’t the GOP come up with anything new other than just cut taxes?

      The Government also has a revenue problem along with its spending problem and frankly I don’t see really any serious GOP movement to cut spending or to raise new revenues.
      Things can’t get better until both are done or certainly until one is done in a large way and the GOP is doing nothing on either.

      So instead of your cute little ps comments when asked things I’d like to see some real answesr from you.

      If the GOP were to take control of the House and suggest that the Shrub’s tax cuts get extended, what’s the deficit neutral offset?

      What’s the suggestion, other than cut more taxes, to get more people working?

      What’s the suggestion, other than cut taxes, to get to a balanced budget in a sensible way?

      I’d love to hear your answers instead of more of your ideological crap.

      • MasterPo says:

        We – meaning the Obama administration – has allocated $700 BILLION for “stimulus” (though oddly only a bit more than half has actually been spent, I wonder why). That’s on top of TARP, AIG bailout, Freddie and Fannie bailout, GM bailout, cash for clunkers, cash for caulkers, DOUBLE the cost for this census compared to the last one, etc.

        And in spite of all that we *still* have a U6 unemployment rate of 16% and apparently growing.

        If that’s what spending all that money buys us you’d call that a sound expenditure?

        There is no other “idea” to get people into a buying and investing frame of mind besides – gasp – letting them have more money to spend and invest and, in the case of investment, as crazy as it sounds, actually being able to KEEP the profits if successful! Heresy, I know.

        There is no “ideological crap”. There is only truth.

        There is NO historical evidence, NO example in modern (or ancient for that matter) civilization that you or Ricky or anyone else can point to that proves spending this much $$$ and getting this deep into debt is what gets a country out of a rutt and into growth and prosperity. You can’t.

        But I OTOH can CLEARLY point to many examples of gross spending and crushing debt as THE SOURCE for what has DESTORYED nations in the past EVERY SINGLE TIME IT IS TRIED!

        If history is now “ideological crap” then I’m proud to be guilty of that.

        • Jack Clark says:

          “If history is now “ideological crap” then I’m proud to be guilty of that.”

          As usual Po thanks for dodging the question, not answering, and bringing what you always bring to the conversation, zero.

          “There is NO historical evidence, NO example in modern (or ancient for that matter) civilization that you or Ricky or anyone else can point to that proves spending this much $$$ and getting this deep into debt is what gets a country out of a rutt and into growth and prosperity. You can’t.”

          First, I am not by any means with the Beagle on most things. And second I never said that all of this crazy spending was good, necessary, or will amount to anything other than our children’s, children’s, children paying it off.

          What I said previously was that history HAS shown, but you choose to ignore it, is that the GOP’s only idea of more tax cuts would be about the only thing right know more disastrous than another bailout of someone else.

          Neither political party, and that would be your party too, has done a thing in the last nine years to stop the gravy train of debt spending. So if you can’t stop spending then you must tax.

          One way or another Po this country, and that would be all of us, is going to have to take its medicine in one form or another.

          And as I’ve told you before, while I don’t like the idea of a large and probably permanent tax increase, I’ll take it over the GOP plans of either giving more money to the wealthy and hoping that something trickles on our poor and middle class heads, or the usual GOP answer of the last two years, to do nothing.

        • Rick Beagle says:

          Again, you continue to propose that we cut our government’s revenue stream (even though it is historically lower than it has ever been according to the economist and money), while increasing spending with bailout to banks, BP cleanup (again, I refer to your comments that taxpayers should be on the hook for that), defense, NASA, and an assortment of giveaways for businesses?

          The next repub convention sure will be held at Hogwarts, because only magic will make that work. Buy I digress….

          Meanwhile (not nearly a complete list, but you get the gist), the Republicans limit the stimulus to levels lower than most economists predict would be necessary to stimulate job growth (Krugman), interfere with the approval process for top government spots (lowest number approved in history), blatantly support corporate greed (citizens united), provide no ideas to help the country beyond sound bites, actively stir racial tensions, actively promote violence and secession, actively puts political hits on innocent people (nice what you folks did to that lady eh) and organizations (people still think ACORN is the boogeyman despite independent confirmation that it was a pack of lies, and now the nine man strong new Black Panthers…) and then complain about it to their constituents.

          And let us not forget that a number of Republicans have stated that if they regain any of the Houses that they would impeach the President by any means necessary (Bachmann and others).

          This, THIS?! you want as your elected officials? As stated, if the Republicans come to power and make good on their promises, no one will be able to stand between us and the abyss as what little government direction we have will be stifled by a case of the crazies.

          Jack, didn’t you know that Republicans are only fiscally conservative when Democrats are in power? Hopefully that clears up that little mystery for you concerning the Shrub et al.

          Rick Beagle

  7. MasterPo says:

    ps- Nor can we simply print money as we need it! That always works out sooooooooooooo well for countries that try it.

    • Rick Beagle says:

      The truly funny part of this comment, you don’t seem to realize that we would have to print money to support these tax cuts. A trillion in stimulus and “oh no, we are burdening our grandchildren!” but a trillion in tax cuts is simply putting money back in the hands of the people who should have it? I guess for that latter suggestion, we don’t print the money, we copy it?

      Rick Beagle

      • MasterPo says:

        Ricky –

        1) No.

        The truly sad part is that we can’t cut government growth and spending!

        Tax cuts do NOT EVER NEED TO BE “PAID FOR”!!!

        It is NOT the gov’s money!!

        The gov is just that – govenment!

        Goverment does NOT get a “revenue stream”. Certain functions of government require expenditures paid for by taxation. And that’s that.

        Government is NOT a business! It doesn’t have to show a profit or excess. In fact, if gov does show an excess (a surplus) that’s because it TOOK too much $$$ from you and me!!

        2) Let’s burry yet another myth: The defense budget is only *20%* of the entire federal budget! Even now during war (regardless of what Obama calls it these days).

        Can you explain how 20% is bankrupting the country?

        BTW, Social Security and Medicare is more than 40% of the federal budget! And THAT is bankrupting.

        3) And the Republicans got their tails whooped because of it (as well they should have!).

        NTL, when President Bush left office the national debt was $8 trillion. As of right now, according to, it is $13.3 trillion. That’s an INCREASE of 62.5% since Obama took office!

        Even Obama’s own projections show a national budget deficit of $1+ trillion for the next 10 years!

        The sand must feel very cozy and warm over your head. But the truth still remains.

        • Rick Beagle says:

          “Tax cuts do NOT EVER NEED TO BE “PAID FOR”!!!”

          Whether you are happy with it or not, tax collection is the only source of revenue for our states and our nation. If you cut taxes, in order to offset a larger deficit, you have to cut spending. And here is where your Republicans fall down (and a lot of Democrats).

          Explain that.
          Rick Beagle

        • Jack Clark says:

          “NTL, when President Bush left office the national debt was $8 trillion. As of right now, according to, it is $13.3 trillion. That’s an INCREASE of 62.5% since Obama took office!”

          Right Po and as usual that’s only half of the story.

          You’re forgetting the other half that involves the Shrub getting this country involved in two wars that we have no place being in and even if we do there is no “coalition” like Shrub Sr. had and we are footing the whole bill.

          Also under Shrub Jr’s watch the financial and lending institutions of this country were pretty much allowed to regulate themselves.

          That would be like saying we should get rid of the umpires in Baseball and let the pitchers call the balls and strikes since I’m sure they would just “do the right thing”.

          All of these Fubars cost money to fix.

          I won’t even get into the whole Medicare/Medicaid/SS minefield.

          The Shrub had eight years to do something, six of which his cronies controlled both houses of Congress and they batted a combined 0 for 8. And the best they have to show for a fiscally conservative fix was the whole prescription drug debacle that was 100% Bush’s doing and is the largest entitlement since SS.

          Like I’ve been telling you for months now Po, the Left is by no means perfect or even any good but at least they are trying to fix things.

          The Right is just being a giant speed bump that slows down progress by being the party of “No” and after spending obscenely during Bush’s second term now wants to be fiscally conservative?

          Cut the crap Po and see those Tools for what they are.

  8. MasterPo says:

    Ricky – Sometimes I just don’t know what to make of you and your ilk.

    Where do you *think* the money comes from for people to spend and invest? The spending and investment fairies??

    You take people’s HARD EARNED MONEY (oh that’s right – people with money stole it, not actually earned it) and guess what? They have less to spend and invest!

    Cut the government spending!!!!

    You and I and our families are constantly told we have to do more with less.

    How about government live by that creed too?

    Or is that too ideaological a concept?

    • Jack Clark says:

      “How about government live by that creed too? Or is that too ideaological a concept?”

      Why don’t you ask the Shrub, Cheney, DeLay, Hastert, and Frist how conservative they were with spending during their time in power before the next time you criticize the Left about actually trying to do something other than waiting for the big trickle down.

    • Rick Beagle says:

      what do you suggest we cut?

      May I suggest the defense budget? It is huge and the last CBO report that I read estimated in excess of thirty percent waste. And where is the outrage over corrupt defense contractors continuing to receive “no bid” contracts? ACORN was destroyed over lies (confirmed and in court), but Haliburton, GE, XE, and others with repeated offenses are let off the hook repeatedly. Cutting these crooks from the gravy train would be good first step?

      What about those tax policies that encourage companies to move their HQs and their jobs to other countries? That seems a bit counter intuitive? Perhaps we could plug up those holes?

      Let us continue by restricting federal dollar redistribution to states in the union that can not seem to balance their budgets and are and have been for year on state welfare (pretty much every red state except Texas).

      BTW nice little job Cheney did on increasing the number of Mercs that work for our military by the way. Just another little gift that the Shrub administration for you to mull over.

      To recap, there are a LARGE and easy number of saves but you have to get past the corporate sponsors and have the political courage to do it. While I will readily admit a disgust at the lack of a collective spine amongst the Democrats, the Republicans make them look like righteous crusaders…. In other words, I trust the Democrats (by and large) as more likely to do the right thing, than the current crop of Republicans.

      Rick Beagle

  9. MasterPo says:

    Ooops – Posted my reply under the wrong message.

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