Is it time to short the market.

[edhopper]

The market hasn't made financial sense in months. It's headline driven on very low volume.
Is it time to short it for a pullback?

[CoffeeCat]

1. Yes, definitely

There are certain sectors that have risen, and frankly--it makes absolutely no sense.

Furthermore, the media has been doing a bang-up job of marketing the notion that it's green shoots,
rainbows and unicorns all the way. This did effect the market, to some extent. As far as picking
individual stocks...that's the difficult part.

I think some of the retail stocks are overvalued. This month, Target announced very dismal earnings. Despite
that, the stock went up. Target is not doing well at all. They're attempting to position themselves as a
"bargain store"--comparable to Walmart. Most people who do the grocery shopping understand that their groceries
are very high. People are going into Target less for what they are known for--candles, furniture, picture
frames, etc.--so they're grocery sales have to be affected as well. Check out Target--there are so many food
and grocery items on clearance.

Also, some home-construction and building retailers increased lately. I don't understand the logic in that, other
than the media disseminating confusing information about home sales increasing. Articles that tout a 20 percent
increase in sales--is misleading. Yes, it's 20 percent--but off of horrendous lows.

I'm just thinking out loud, but I do agree that it's a good time to short.

[the other one]

2. soon

but probably not yet

after labor day should see a boost, and again after yom kippur

keep your eye on the dollar cost index. it currently is about 78.5. look to short when it gets down to the 70 range

[truebrit71]

3. Disclaimer Needed. Shorting is EXTREMELY risky.

..and should only be undertaken both those that fully understand the risks...

[Turbineguy]

16. As one of my friends used to say:

"There's a limit to the amount of money you can lose when you go long: All of it!"

[The_Casual_Observer]

4. This market is very unpredictable.

[notesdev]

5. I wouldn't touch it in either direction

The fundamentals call for a major market crash, but between the Fed printing money and giving it to banks, and those banks then HFTing their way into believing the insolvent companies they are trading shares of are worth anything outside the expectation of bailout after bailout ad infinitum... at some point this game is going to end, and it will be ugly.

But I wouldn't place any bets on just how long they can keep it up. Bernanke quite frankly scares me, I don't think there's anything he would not do to try to maintain the fiction that this whole mess is not to a great degree his own fault.

[CoffeeCat]

6. Great points, notesdev...

As long as someone/something is propping up this house of cards--it stands.

It's difficult to understand how and when it all comes tumbling down.

No administration wants the crash to happen on their watch. I'm afraid that our politicians
will do anything and everything to avoid accountability. As long as they can tout "growth" and
"green shoots", their polls stay up.

It's frankly...frustrating and sad.

Our economy is like Bernie from "Weekend at Bernie's". We have to keep propping him up on skis, at the
dinner table and in a deck chair next to the pool. This may fool some people in the short run, but you
can't hide a rotting, dead economy forever.

Bernanke is on the left; Geithner is on the right. Unfortunately, that's our economy in the middle.

[pa28]

7. It looks like a reasonable place to start a short for a pullback.

Unfortunately with the type of blowoff top like we're in now it's tough to predict where the ultimate top will be. Like the cliche goes; they can run 'em up longer than you can stay solvent.

Last year I'm sure plenty of people made a reasonable decision based on fundamentals to short oil at 120 or US Steel at 130 during pullbacks. Ultimately they were proven right but they probably were forced to cover or wound up attached to a defibrillator before they realized any profit.

If the dollar breaks into new lows I suppose I'd be covering and buying rather than shorting.

[AdHocSolver]

8. The stock market is a Ponzi scheme rigged to benefit a few select insiders.

They will pull the plug when they feel they can maximize their profits. If you can't read their minds, you cannot know how to profit from the game. You are better off buying lottery tickets.

The "real" economy is surviving on life support. The stock market is being buoyed by infusions of bailout money. There is no correlation between the two.

The "real" economy will not recover until we stop importing practically everything we buy, and bring jobs back to America.

The stock market will "permanently" collapse when foreigners will no longer prop up the U.S. dollar, by refusing to buy our debt.

It is because people can't understand that the stock market is a scam, in spite of all the revelations during the past few years (anyone remember Enron?), that so many people have lost their savings, and the economy is in such a mess.

[Po_d Mainiac]

10. yup Look at the volume leaders

Shitigroup, Fannie, and Freddie have been at the top or near top for weeks. These stocks are pure zombie excrement/junk

[tama]

13. Recovery of real economy

Correct, oil importing countries need to stop importing oil and products made from and with oil.

"Bringing jobs back to America" means, in reality, going back to manual labor in the fields and gardens. Self sufficent and sustainable way of life. A much healthier way of life.

There is no going back to growth mania and mindless consumerism, in real economy. And that is a very good thing. Only thing bad is false hopes and self-deception.

[girl gone mad]

9. Getting very close, BUT..

I've been short oil this week (sco) and I also believe that equities are overpriced, BUT money managers are still desperate to outperform this market so the rally may still have legs for some time to come. I would be cautious.

[edhopper]

11. Last summer

I knew the market was way overpriced. I moved a lot into cash (not enough to avoid a loss) but I didn't want to take the big risk to short.
I see this market as a repeat of the pre-Lehman time. But again I know it might be more risky than I can handle.

[SlowDownFast]

12. Getting close.

I'm starting to edge in on the short end, but watching very closely - like at-my-computer-every-hour-of-the-trading-day closely.

Todays drop seems especially convincing, but stick-saves via intervention and lies/rumors (via CNBShit - their mouthpiece) can happen at any moment, as we have seen before.

The game is rigged and traders really need to be on their toes.

The big money bounces between Equities, Treasuries and FX. You have to watch all three to try to get a handle on where it's all going.

Technicals matter less and less. Stay on the sidelines unless you really have an inkling of what you are doing.

[Skink]

14. By shorting you don't mean borrowing to buy stocks in a declining market?

that is unethical and should not be tolerated. Trading within a portfolio and buying stocks as they lower is perfectly fine.

[A HERETIC I AM]

15. That is not the definition of selling short.

By shorting you don't mean borrowing to buy stocks in a declining market?

Borrowing to buy (go "long") stock is done via a "margin" loan otherwise known as buying on margin. It is not the same as selling short.

that is unethical and should not be tolerated.

Buying on margin is not at all unethical as long as the Regulation T and required minimums are adhered to. It is risky but not unethical.

Short selling is when you sell a security that you do not own. Normally a short seller is required to borrow the shares and then return them when they are purchased at a lower price. An investor that sells short is going to BUY the shares at a later date, presumably at a lower price than they currently trade. The borrowed shares are then returned to the original account.

You might be referring to "naked short selling" which is when a security is sold but no shares are borrowed to "cover". That is certainly considered unethical.

[Joanne98]

19. You can buy bear ETF's now.

[girl gone mad]

21. watch out for the time decay.

[Warpy]

17. I don't think the market ever makes rational sense

but the decision on whether or not to short is your own. I have no idea what the market manipulators are up to. I'm too little a fish to be in on the discussions in the sumptuous paneled rooms in the hidden mansions.

My own sense is that it will likely take a dump this fall and then slowly recover. How much it recovers is anyone's guess, just like the dump this fall is my guess.

We little fish won't know what the smart thing to do is until the mess has been fixed and the multiple crises long over.

[Joanne98]

18. Maybe. it's getting close.

[ParkieDem]

20. I wouldn't.

As a prior poster indicated, shorting is EXTREMELY risky. Not only do you have to be convinced that the market is going to turn downward, you also have to know when it's going to go down.

The market may seem "irrationaly exuberant" now, but on the other hand, it may just be making up for excessive "irrational pessimism" during the latter half of 2008. Sure, the economy was bad then, but was it bad enough for the market to lose 40-60%? Maybe not; that might be why you're seeing the recent uptick in stocks.

[Xenotime]

22. The market is getting worse again. Time to invest in gold