Remember this rant, CNBC stock market maven Rick Santelli reacts to the Obama administration bailout of mortgage failures Fannie Mae and Freddie Mac --at taxpayer expense--and kicks off the new Tea Party movement.
Was there any other option though? What is Obama supposed to do? I just don't think there are many options. I think people forget how bad the stock market crash was and if they government didn't bailout all the banks then we would have looked at another Great Depression instead of a great recession.
Michael Lewis, who wrote the book “The Big Short: Inside the Doomsday Machine
” looks at the financial meltdown on 60 minutes. This book is just an incredible read. What's amazing to me is how the people who didn't believe that the real estate prices were going to continue to go up, and saw the danger of all the sub-prime mortgages, had to wait, and wait and wait, until the collapse actually happened. Many people thought they were crazy, and even pulled money out of their funds, thinking they were going to be wrong. But they
Don't forget this. Even CEO's of big companies make this mistake, if you are going to buy on margin then you better have a back up plan in case a world war breaks out or the market just collapses do to some other unforeseen cause.
This was a classic margin call during the melt down of the market a few years ago. McClendon was forced to sell 94% of his Chesapeake Energy Corporation (CHK) holdings, the largest producer of natural gas in the United States, which were worth more than $2 billion at their peak:
In July of 2008, with
Priceline (PCLN) went from $427 to $464, a $37 move over night. Ouch for those who were short and joy for those who were long. It's always a gamble to short in and around earnings with high flyer stocks that can jump or drop in big ways when they report. Nobody wants to gets squeezed if they're short.
And just so we have this clear, here's the good old definition of a short squeeze: A short squeeze results when the price of the stock rises and investors who short-sold the stock rush to buy it to cover their
In times of worry and panic, and in just an awful market, I think this is a good thing to remember, yes from Jimmy Cramer again:
Cramer says in a real bear market, you want to buy the accidental high-yielders
, because even if they don't go up, they'll still pay out a decent enough return, and that dividend makes a great cushion that keeps the stock from falling too low.
I have to say this are good ideas to keep in mind. However, I would say that buying a stock that you like when it goes down isn't a bad idea, don't think averaging in is a bad when the stocks fundamentals are good. Also, think the idea of buying accidentally high dividend stocks
is excellent - this a Cramer staple of late when the market corrects.
With more than 30 years of experience as a currency and commodities trader, Dennis Gartman on Thursday revealed his three rules to trade by in 2011:
1. There's Never Just 1 Cockroach
If you hear someone talk about a stock on TV it's probably too late, as in too late to buy the stock. More often than not, when the stock gets talked about on TV then the stock as already made it's run or is about to and it's hard to catch. You end up chasing the stock.
Sure, this isn't always the case, but you have to tread wisely when you're buying a stock that gets the rounds of the TV hosts on CNBC. If you do buy a stock that's widely pushed, then be prepared
Mad Money host Jim Cramer makes a passionate plea to Federal Reserve Chairman Ben Bernanke to consider cutting interest rates and, in turn, help the market and the people who are losing their jobs on Wall Street.
Many folks give Jim Cramer a hard time, but the guy tells it like it is. Here, he goes off on Bernanke and and St. Louis Fed President Bill Poole. This is a classic and a must see. You've got to love the passion that Cramer has for the market. The guy is an addict in the best sense.
In the video below, Jim Cramer of Mad Money fame, makes this call on Procter & Gamble Company (NYSE) PG during the flash crash of May 2010.
The flash happened on May 6, 2010, the market was down already close to 300 points due to the Greece debt crisis fears. But then the market just tanked, going doing close to 600 points in a few minutes. However, 20 minutes later the market regained the 600 or so points that it had lost. If anything, I think this shows you just how much the market is controlled by computer