Wall Street and Pricing In Economic "News"

I'm interested in how you know the news in advance?

People always try to pin daily moves on singular events. Its pointless and dumb, the world is not evolving around a single issue at any given time, its a constant confluence of events.

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It's always near impossible to know a reason for any move, but I'd say the Hungary story is the dominant one here.

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yeah, i often fall prey to the stupid AP, etc. headlines on Yahoo! Finance. They place two pieces of news side-by-side and tacitly attribute one as a cause for the other.

e.g., stocks slide as Obama takes giant dump on West Lawn. Those two things may have happened simultaneously, but there is no causal link. Although, if that particular example were to be reality, I think it might cause stocks to slide.

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but the much larger issue of Europe on the brink has not gotten even remotely better

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Not only that, there is a massive new negative datapoint today.

Man that is one low and steady drop right there.

yep.

i've been thinking a lot lately about market psychology and manipulation. it's enough to drive one nuts. the only stake i have right now is my self-directed 401(k). the tax bens make it worthwhile. otherwise, no way would i be f'ing around w stocks. buy and hold seems doomed, and i have no technical skills (or insider info, as far as you know).

Part of the drop has to do with the job numbers, some of it has to do with Hungary and Europe, and this final drop probably has to do with investors not keen on holding on over the weekend.

Before the jobs figure was released the market was trending lower due to Hungary and Europe concerns, then the Dow futures went down another 100+ points after the numbers came out at 8:30.

Earlier in the week there was a spike in the market after O & B said in speeches that there was a strong number coming out on Friday.

They shouldn't publicly comment on a market moving figure before it is released. Their interpretation of a strong number is different from most - at least Wall Street's. They were happy with the 9.7 unemployment figure and the overall number.

The jobs number was propped up by all the census jobs that won't be there in another 60 days. The private sector added roughly 40,000 jobs so it was anemic.

I am not so sure that I agree with pinning daily moves on singular events is pointless and dumb because today seems to indicate that a few headlines caused the drop or at least swamped the other items.

LINK

Even though those guys on the Poli board called the number (within the margin of error?) were they able to make money off of that?

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Earlier in the week there was a spike in the market after O & B said in speeches that there was a strong number coming out on Friday.

They shouldn't publicly comment on a market moving figure before it is released. Their interpretation of a strong number is different from most - at least Wall Street's. They were happy with the 9.7 unemployment figure and the overall number.

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No one from Wall Street gives a shite what Obama or Biden has to say about pending unemployment numbers.

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The jobs number was propped up by all the census jobs that won't be there in another 60 days. The private sector added roughly 40,000 jobs so it was anemic.

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This was known by pretty much every one.

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I am not so sure that I agree with pinning daily moves on singular events is pointless and dumb because today seems to indicate that a few headlines caused the drop or at least swamped the other items.

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No, today indicates that, as evidenced by your post, people think those things have more of an impact than they do. Yes, I'm basically telling you I think you are 100% wrong about this. ETA: Sorry, not trying to be a dick, I just vehemently disagree.

Sorry for the double post.

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Please explain why the market shot up late Wednesday afternoon and why it went down today. I stand by what I wrote about O & B talking up the strong number (in their mind) earlier in the week and the Europe factor and jobs number.

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Politicians talk nonsense all the time, its their job. The last thing any reasonably competent financial analyst is doing is listening to the jibberish that a politician spouts off during the week about a backwards-looking employment report. The financial media hypes the shite out of the UE report, in reality its not that important, as 95% of it is already baked in from initial and continuing claims stats. The lower than expected private sector creation probably had some effect, I explicitly stated that, but it was not, in and itself, the reason the market went down 320 points.

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You didn't know what the number would be until after it was released. What was known by pretty much everyone -- the 40K private sector jobs, other,?

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That it would print 500k. Private (real) missed, the market reacted. It didn't react to the tune of -330.

Unless you look at technicals, you can't reasonably determine how much of that pullback was event driven and how much of it was supply/demand driven, and that is my ultimate point. The market does not move purely on news, it moves on news and technicals. Ignore the technicals and you risk overstating the fundamentals (like blaming today's move entirely on the UE report adn the Hungary development, or ascribing any material amount of the movement on Wed to what a politician said about an overhyped data point) and vice versa. Ignore them if you want.

No, I highly doubt it. It was a shitty day all around, we were sideways for a while then really sold off at the end. I think the euro getting killed, consumer spending remaining shaky and the DJIA breaking through its supports were some of the culprits. We did see some good news out of the G20 summit though on the proposed global bank levy.

On a side note, gold killed it today