Daily Investment Interpretations
August 4, 2011
(Thursday Night): The
market indices have crashed, with the Dow down more than 500 points: Dow,
S&P, Nasdaq suffer worst point drops since 2008, Stocks
pricing in recession, Market
Dives To Worst Loss Since Dec. 2008 . The NASDAQ Composite
) to end at 2,556.39.
The Dow deflated 512.76
to close at 11,383.68;
the S&P 500 slumped 60.27
to settle at 1,207.07. Oil closed down at $86.29; gold fell
1,650: The VIX exploded 8.28
(!) to 31.66!
Two market mavens argue that now is the time to begin buying, when fear running wild: Why now is the time to buy, and Cody Willard: Why I'm buying. But Mark Hulbert warns that markets don't bottom in a spate of panic selling when gurus are proclaiming a market bottom: Hulbert: It's not a bottom, and Panic in the air. Rather, they sneak up on the experts, and are generally only recognized in hindsight.
In Two ways to protect against the market swoon, low-cost, out-of-the-money puts against the S&P 500 ETF SPY are recommended as insurance against further losses.
Money moves from Gary Shilling: "To economist Shilling, another U.S. recession within 12 months is a matter of when, not if. It may be here already."
Market futures are neutral tonight.