Just when I thought the markets were about to find footing … they get spooked and the stampede continues. According to Jeffery Saut of Raymond James selling stampedes usually last for 17 to 20 days.
Currently, cash seems to be king as it seems some are now selling assets and raising cash. Since early 2014 I felt stocks were getting overvalued and I have been raising my allocation to cash, over time, from around 10% to now about 25%. With this, I have an ample supply of it to engage a buy strategy in this market's downdraft. I made my first buy step in this falling market at 1922 last week and around 1870 (S&P 500 Index) I’ll be making another buy should we get there. If we don’t then this puts my strategy on hold.
In looking at the markets this morning, as I write, the S&P 500 futures are steady at about where they closed while Greater Europe is down with most of Greater Asia being down with the exception being (get this) China which is up. (Go figure).
I have no idea or feeling where things might drift today. Perhaps with China finally being up and finding a little footing the states side markets will too. What concerns me is that, thus far, Europe did not follow China’s upward movement today. After all, the markets are spooked and this is a selling stampede which will just have to sell itself down until big money says its time for it to stop ... or, perhaps the Plunge Protection Team steps in.
Now, I wonder where the Plunge Protection team might be that was established by Presidential Order under Ronald Regan as they are suppose to maintain investor confidence in the markets. Seems some have perhaps lost confidence and are now selling as some might say, in stampede fashion.
Indeed, today has the makings to be a most interesting day for investors. The question(s) ... Will the S&P 500 futures hold steady and/or move upward? Or, will the stampede continue?
Below is a link that will explain more about the Plunge Protection team.
https://en.wikipedia.org/wiki/Working_Group_on_Financial_Markets
Comments
Reportedly, the Japan central bank owns about 52% of the etf equity sector for that country.
Maybe price drops would be worse if central banks weren't involved.
Japan central bank report as of Oct. 2015
Derf
P.S. Did any observer hit the power ball ?
"or, perhaps the Plunge Protection Team steps in."
China tried something to prevent their market from plunging, and it didn't work at all.
It may have even had the reverse effect......
With global markets and millions of participants, good luck trying to prevent market plunges.......
As I write, looks like the S&P 500 futures are trending upward. A good thing by my thinking.
Hi @Derf,
I agree in a rising interest rate environment creates some unwanted things in the equity markets. Perhaps, the fed will move forward in their plans for interest rate hikes more slowly than some spokespeople have been broadcasting.
Hi @rjb112,
Thanks for your comment. I acted on your suggestion and I have changed the title line.
Thanks again to all that have made comments. Please stop by again as all comments are welcome both pros and con to my thinking or my comments.
Skeet