iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
23,417 Blog Posts

October Decline Super Rare Event, Reminiscent of 2000, 2008, and 2012

Digging into Exodus, I found the recent heart shattering drop, which by the way is being handled with excellent decorum, to be a very rare event, as far as recent history is concerned. Month to date, we’re down 7.5%. Since 1999, the only Octobers with similar declines were in 2000, 2008, and 2012.

Back in October of 2000, the market had already cracked asunder — and the world as we knew it crashed to pieces. I even wrote a book about it. In other words, the October crash came as no surprise in 2000 and markets were already in a grim mood.

Fast forward to 2008, a recent history that most of you could make allowances for, and the financial crisis was in full swing. I mean, the shit was in the fan and spewing everywhere. Worldwide, markets had already melted down. The pleasant experiences of the past 200 years of democracy was in the balance and capitalism, as we knew it, had failed. The banks had been bailed out and the people were readying themselves, outside the city gates, armed with pitched forks and eyes blazing with fury.

And then there was 2012, a year often glazed over as unimportant — but was supremely pivotal in keeping the EU together with Greek bank bailouts. The good news is, once markets bottomed in 2012 — they never looked back — charging forward and soaring in 2013, higher by 36%.

This is year 10 of the bull market, defined by net positive returns in the QQQs. We were up more than 30% last year and have YTD returns in the magnitude of 11%. The recent 7.5% slide in the market has been fast, but taken with a grain of salt — since most people are accustomed to brief interludes of loss followed up by long durations of gains.

Traders aren’t prepared for an extended pullback. We haven’t had one since 2008; and the only markets scares we had since then were mostly superficial and solved by Federal Reserve reassurances.

Is this time different?

Perhaps. Let’s keep an open mind to the fact that we’ve never been in a trade war with China, and certainly not during a time when the Fed was hiking rates as fast as they could. In other words, there are tangible risks to the economy, and the Fed, as always, is ignoring them and tightening credit — which further exacerbates the situation.

My hope is for a 2012 scenario and all will go back to normal soon. After all, the China trade issue could be solved with a conversation on the phone, a crisis to be averted just like the European bailout drama.

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20 comments

  1. acehood

    No reason not to buy China here with, at the very least, long term accounts.

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  2. Lyndon Keltner

    2000, 2008, and 2012 were presidential election years. Some argue that 2018 is a quasi-presidential year given the illegitimacy of President Button Mushroom, who lost the popular vote by the widest margin in both the total vote count and percentage terms since 1789.

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    • Lyndon Keltner

      Moreover, 2018 will be the first year in which the white majority electorate fails to maintain control of the U.S. House of Representatives despite their blatantly racist gerrymandering efforts over the last several decades. There will be more and more minority voters in most of those so-called swing districts that are already designed to maximize their whiteness.

      Trump wants his supporters to believe he can somehow reverse that trend, and they are gladly buying his snake oil. But it is only another lost cause and he is only a con.

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      • metalleg

        You sound kind of bitter. Give it another year or so and you’ll probably get over it.

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        • moosh

          No way, Lyndon probably spent all day thinking about this type of stuff.

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          • Lyndon Keltner

            All day only on rather rare occasions.

            And it’s hard not to think about “this type of stuff” if you have family members who were denied the right to vote when they were young and are still being denied today.

            If the so-called violent left actually exists, they should take The Ballot or the Bullet sermon more seriously.

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        • Lyndon Keltner

          Not really bitter. More like impatient.

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      • wolfdaddy

        Coming from the biggest racist here. Kill yourself

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        • Lyndon Keltner

          racism noun
          rac·ism
          | \?r?-?si-z?m also -?shi- \
          Definition of racism
          1 : a belief that race is the primary determinant of human traits and capacities and that racial differences produce an inherent superiority of a particular race

          Excuse me, I wholeheartedly believe neither race is the primary determinant of anything nor any racial superiority.

          So, by dictionary definition, that would logically make me the least racist commenter on here.

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    • mintdragon

      My dude, if you don’t understand why the US doesn’t use a popular vote, you aren’t mature enough to be commenting on this site.

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      • Lyndon Keltner

        But I do understand. What we have today–a electoral college in name only–is antithetical to what James Madison originally intended when it was designed.

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        • mintdragon

          Dude, I don’t hate you. I’m not putting you down. I don’t do politics on a trading forum. But from a purely logical perspective, if you are aiming for national office, you already know that your success isn’t tied on winning the popular vote.

          If you want to change the rules (for example, to be compatible to what James Madison originally intended), that surely should be done before the campaign window, not used as a pedestal to stand on to pronounce that the winner of the voting process won unfairly.

          I vote every election, and don’t take it personally if my choices aren’t the winners. I spoke my piece and voted my views. My ONE vote. And I’m okay with that, as every American who understand the existing process should.

          Be well, best wishes on your investment choices. ??

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      • Lyndon Keltner

        And, FYI, Constitutional law professors Lawrence Lessig et al. wrote extensively on the matter if you care to understand it better:

        https://medium.com/equal-citizens/on-what-noah-misses-the-continuing-debate-about-the-electoral-college-12a8301bccd5

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    • chuck bennett

      Hey NPC,

      What percentage of the popular vote did Lincoln get?

      stop being stupid

      Regards

      Chuck Bennett

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      • chuck bennett

        Yes, you are the biggest racist here.

        You know this already. Yes

        Funny how you pull out a dictionary. Hahah

        Stupid racist, but I’m not mad at you.

        Regards

        Chuck Bennett

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        • Lyndon Keltner

          1860: Lincoln 39.8%; Douglas 29.5% (Lincoln recevied 10.3% more popular vote than the second-place finisher)
          1864: Lincoln 55.0%; McClellan 45.0% (a 10.0% margin)

          Lincoln clearly wasn’t considered a legitimate President by the Confederacy. Hence, the secession. Lincoln was a spineless moderate politician who was at best lukewarm to the idea of abolishing slavery till he needed the slaves to join the Union Army in late 1862, since you brought him up.

          Facts: Race is a social construct. This very construct was created and developed by some individuals who (sincerely but) incorrectly thought that their lack of melanin somehow made them better than others–way before America became its own country some centuries ago.

          I wish said social construct was a thing of the past. But it still is alive and well as of now. I am racially conscience–and, again, not racist–because of its continued existence.

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        • Lyndon Keltner

          One thing I don’t express often enough…

          I do appreciate your willingness to allow me to explain my views and my reasons, even you may not like them or agree with what I have to say.

          I am very accustomed to being called a troll or a racist on right wing blogs, and I masochistically enjoy the name-calling and the general disapproval. I appreciate the thoughtful responses, however rare they are, even more. Those responses do appear here.

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          • chuck bennett

            39 percent.

            Lincoln did not get the popular vote son. 😉

            Regards

            Chuck Bennett

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  3. mad marsupial

    If China gets back into Opium, I’ll get involved fast.

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