Crash Market Stocks - Financial Tips On Making Money In The Stock Market

Stocks have rebounded quite nicely since September's trading woes. Two weeks ago, trading was looking quite grim with not a lot of optimism. However, markets have had some good trading days and bounced back. Beware of falling into the trap of going long too soon. There still remain a lot of discouraging signs in the market that could push for another sell off. Consumers are sensitive and just the slightest negative pressure can turn optimism into pessimism.

One big thing to keep eyes on is the VIX levels. We have seen quite the spike in the VIX (volatility index of markets), which mostly leads to downward trading in the long run. We saw record VIX levels in 2009 when markets reached lowest levels. The theory is that the more uncertain traders are, the more sensitive and volatile they trade. In fact, just in the past two months, we have seen several +/- 1% Dow trading days. It has come down a bit this past week, but still remains in high levels.

After months of upsetting their subscribers, Netflix announced this week that they would not be splitting their streaming and DVD company up. Recently, Netflix changed their subscription prices, charging significantly more for those wanting to continue receiving DVDs. In addition to the price change, Netflix announced their plan to divide the company and retain the streaming service under the Netflix name and create a new company (Quickster) to house the DVD business line.

Customers responded to this move with even more anger for the company, which resulted in some loss of subscribers. After a few months, Netflix finally gave into the complaints and hacked the Quickster company, keeping the two businesses under the same roof.

Throughout the duration of this debacle, we have seen a tremendous drop in Netflix's (NFLX) stock price. After reaching highs of well over $300, the stock almost reached the $100 mark this past week. Investors have begun to question the decision making ability of the company's leaders and whether or not they have the ability to continue strong growth.

Additionally, Amazon is starting to show its big, ugly face around the corner as a massive competitor of Netflix as they just recently announced their new Tablet as well as their growth in streaming content for their Prime users. This is another influencer for selling NFLX.

Personally, I believe the stock has been a bit oversold at this point. Much of the reaction has been emotional, which tends to reach far beyond the point of logical valuing. The point is, Netflix still controls the largest amount of streaming media content, which will always bear the largest subscription base. If Netflix can keep this trend, they should continue strong growth. I threw some of their stock in my account on Monday. Happy Trading.

A new week begins, and considering what happened last week, there was a lot of anxious investors awaiting the opening bell on Monday. Warren Buffett made it easier on everyone by announcing his plan for Berkshire Hathaway to begin purchasing back its own stock. This move is very interesting, as it is usually Buffett who is critical on companies who initiate to do so, accusing them of "propping up" stock prices for their own companies. He, however, said when there is added value, the move can be very worthwhile for investors. I guess the the market agreed, as Berkshire Hathaway A traded up nearly 8% today. However, it still remains down over 20% for the year.

Buffett is not the first to initiate buybacks for his stock. In fact, 2011 is already one of the highest volume of buybacks ever. This does not necessarily lead to upward trading in the overall markets. In fact, the largest year for stock buybacks was in 2008, which as many know, was the year that also marked the extremely large drop in the markets. The takeaway is, indeed companies buying back stock can be a very good thing for investors and often causes a short term pop in the price, however, it definitely does not guarantee big returns for that particular company.

Markets took a tumble last week as Bernanke announced his newest stimulus plan for the economy. Many felt that the proposed plan was much less than expected which caused a strong retreat in markets on Thursday. Fortunately, markets have recovered a bit since. However, a negative sentiment is still looming over Wall Street as new home sales continue to remain stagnant and employment is sluggish.

Kodak is seeing record drops in their stock price, as investors' concerns are growing in regard to their ability to reposition themselves as a "printer" company. Risky investors are hoping that indeed the sell off is too aggressive and hoping for a small buy back. At this point, they are clearly at high risk, but where there is risk there is a possibility of good reward right? Too risky for my blood.

We are reaching a very pivotal time in market trading, where the next few weeks are really going to set the stage for institutions heading into "redemption" seasons. We saw the massive sell off in gold on Thursday, as hedge funds were forced to sell, needing to show profits for positions. This indeed could be a trend in the near future, leading to me cool off on the gold investment for the short term. Time will tell. Happy Trading.

The past month has been an eventful one in the stock market. It almost feels like 2008 again. I almost thought the day of 500+ point daily drops in the market was over, but as I have always said, this fragile state of the market we continue to wade in, not much is required to shake things up.

Debt problems in Europe continue to apply pressure to domestic markets and US has their own basket of problems with their own debt. We have been a kid at a candy store with mom's credit card for the past two years, and collectors are beginning to come knocking. Anyone who believed that we would cruise out of this recession as we have, with minor scratches, was drinking too much government Kool-Aid. The fact is, is that our economy was hinging on borders of depression and that true unemployment spiked to over 20% in some states and that we have now sailed out and are having consumer responses as they were in 2006... Be assured, this is a mirage.

No doubt the government is prepared to battle any new or unforeseen crisis that hit our economy, but if they continue to do so with mindless spending and stimulus, we will find ourselves in a debt hole that is far to deep to dig out. VIX levels are on the rise, which is an alarm clock for bears... Also, high volume levels, which has been bulls' biggest ally, are finding recent record lows. Are we pivoting the market as we speak? I only see a couple scenarios.

The continual trend that we continue to see is the inverse relationship between the dollar and the stock market. As the dollar decreases, we see corporations outsource manufacturing and production which in turn ups their bottom lines, lifting stocks. However, as dollar values rise, foreign purchasing goes down, lowering net income, which causes for a downturn in the market.

With record low levels for the dollar, it is hard to see how it can dip much further. Of course, there is the rare the case that these two could head in the same direction, which would be a very paradoxical event, yet it is possible. If that is the case, it could cause quite the stir in markets.

The Fed has reiterated their plan to keep interest levels low for however long it takes. Many felt that this was the year we would see the hike back up, but it was not meant to be. Banks have forgotten what it is like to have to pay interest on loans and to earn their margins. They have enjoyed the life of free printed money for the past two years and I fear that when the day comes to reinstate interest rates, banks will have quite a problem. Of course, the government does not worry about such things, as much like the stock market, the government is only concerned about the present and not the future.

Keep an eye on the market the next two months, because it will be a telling one. Many bulls may find themselves wishing they would have cashed in on those big gains... I have. Happy Trading.

It seems as if every new week brings in a new generation of the economy. As we now deal with a global economy, there is so many different occurrences on a weekly basis that effects investor sentiment, that it can be hard to keep up with. At any rate, despite inflated energy and food costs, consumers have kept spending into the storm and morale seems high. Quite honestly, I do really know if this a good thing or something we will pay for later, but for now, long stocks are reaping the benefits.

Looking at some influential data, the rising stock trend may keep on a bit longer. Here are some outside influences that are point to a continuing rising market in the near future:

Bonds in Possible Trouble
Bonds have definitely been the comfort spot for many people during this past downturn, and frankly, the past couple of decades. Yields have steadily risen and made many of their investors happy. Thus, there has been a lot of investment taken out of stocks and put into to bonds, which is another reason why we saw such a strong drop in the markets.

Well, the appeal for bonds could be changing. With financial markets continuing to look more stable, it is only a matter of time until The Fed begins to hike up interest rates. This will directly effect Bond rates and may cause a bit of a retreat into stocks. If the retreat is severe, expect stocks to get a pretty strong bump.

Individual Investor Sentiment Down
It kind of sounds like an oxymoron, however it carries some weight. There constantly exists an inverse reaction of Institutions and private investors... When one believes things are good, the other is fleeing for the hills. As for me, I like to be on the side of the institutions, as they definitely throw their weight around much more and thus drive the market in a stronger direction.

As of late, there has been a lot of negative sentiment with private, individual investors. With this usually comes a more bullish move from larger funds. Don't be surprised to see some large blocks trade within the next few weeks and some violent bumps in key markets.

Japan Back on Their Feet
The stall in production that has occurred in Japan due to the earthquake and tsunami has had a global effect on markets, especially the tech industry. Well, latest data shows that indeed Japan has bounced back from recent production stalls and actually is ramping up production and is seeing some pretty strong growth numbers. This translates into a very favorable factor for upward stock movement and is already effecting momentum.

The realist side of me continues to look at the economy with fear, knowing that any large amount of bad news could very easily change momentum of this recent strong climb. Markets continue to be in a VERY sensitive state, and thus far, we have been very fortunate not to experience anything too catastrophic that could send consumers back to saving their money (that sounds funny). However, the above influences should continue to drive markets upward for the near future.

At any rate, the game plan SEEMS to be working at the moment, when looking at the stock market, but there still remains plenty of problems that need addressing. The stock market is not a true gauge of the actual state of the economy, it is only the perception of stock buyers. As of late, it has been the manipulation game of big banks. My advice, don't put all your eggs in one basket, as it is hard to tell where the money is going at this point. Happy Trading.

I apologize for my lack of consistency in posts as I have been very busy in multiple different projects. I love discussing with the CrashMarketStocks.com community and will be doing updates much more frequently from now on.

We are now closing in almost two and a half years since the major downturn in our economy began to take place. It feels like a distant memory as of now. I still remember waking up on mornings wondering, "who will be the big bank to fall today?" Businesses were dropping into bankruptcy left and right and not just small businesses, business that have been around for decades (Circuit City, Mervyns, Levitz and more).

Today, you would never even assume that existed only two years ago. Malls are full again, consumers are happily paying over $4.00 a gallon for gas and companies like Apple are having record breaking sales numbers. I have seen a lot of magicians in my day, but this is by far the most impressive illusion I have ever seen.

I have endured multiple recessions and I believe our most recent had the quickest change of sentiment out of all of them. What makes this remarkable is what fundamental changes were made during that time. National big banks entered bankruptcy, home foreclosure levels at record numbers, unemployment reaching mid teens in some states, and the stock market dipping the lowest we've seen in years. It is all a distant memory, at least that's what it feels like.

So what has caused such a miraculous turn around? I can't complain, my business is seeing huge turn arounds. What makes me nervous, is the artificial nature it has been built on. Why is it artificial? Here are a couple reasons:

The government has essentially partnered with big banks and is allowing them to rake in record profits off essentially government printed money. The US has issued profit/loss share agreements that are extremely favorable to banks and institutional investors that make doing business a no brainer, while delegating the downside to the government. Now you and I as taxpayers will carry the burden of loose underwriting and bad business practices that brought down many of the banks in the first place.

People are hailing that the housing market has reached bottom. Really? The FDIC reports that 1/6 homes are in foreclosure. Do you see these homes on the market? That is because the government is rewarding banks for holding on to these homes. Shadow inventory (homes that are not foreclosed but are in default) is even worse. Most of these agreements have 5 year lifespans, which makes me wonder what happens in 2o13 when a lot of these agreements are up? Slap another band aide on it I suppose.

Unemployment is still devastating. By far the most influential fundamental tracker still shows a depressing result. Am I suppose to be excited about a 9% national unemployment rate? And this number is not going down anytime soon, even the government admits that.

What we have learned the past two years is that we are not accountable for foul play and bad business practices. People have been bailed out left and right for, in some cases, very criminal decisions. This is why millions of consumers have found that they can stop paying their mortgage and spend their extra income on big screen tvs and new cars with no consequence. Sure, the US Treasury printing press can pick up the bill for now, but that result will come full circle eventually. In my mind, it is a time bomb waiting to explode, and when it does, not even our government will have the time or resources to defuse it. I am staying on my toes.