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Could mkt bottom tonite

SGDividend,

When your share lent to someone by the brokerage firm, do they pay you commission for this?

Thanks,

 

 

so with the bailout plans news this afternoon.

As the title thread,have we seen the bottom last friday or today's rebound is just temporary? 

 

There is still covered short selling allowed. My shares custodised with a certain brokerage house is now lent to someone. Frankly, until the day my shares are returned, i believe that person out there will still be shorting. Someone borrowed cityspring from me which explains the following:

Source: www.sgdividends.blogspot.com

Why the drastic drop in price, up to -20% within the first 2 hours of trading on 10 Oct 2008?
SGdividends believe it is the result of someone shorting it. Why? Cos our shares have been borrowed through the Share Borrowing and Lending Program by a brokerage firm custodising it. ( To those who dont understand what shorting means, heres a primer. People can short the stock naked or covered. Naked short means selling first without owning a stock or having borrowed it. It is currently penalised by SGX. Covered short means selling first without owning it but having borrowed it and this will not be penalised by SGX. The purpose of shorting is to depress the prices, and then buying it back at a cheaper price to earn a profit.)

Cityspring holds utilities or infrastructure assets and demand for such services are generally recession-proof as electricity, water, e.t.c are a necessity. The only reason for such a decline we feel, is that they have large debts to repay (normal for such asset centric businesses) and people are afraid that they cannot repay their loans at this time when banks are unwilling to lend. But, Cityspring is backed by Temasek so this reason may not be valid, in our humble opinion. Basically, we believe that the fundamentals for this company is unchanged. In fact, a recent Business Times article featured their CEO hinting of acquisitions at a later date as valuations for such assets are still quite high. sectoral investingbelowTherefore, we believe this drop is due to some manipulation taking advantage of this crisis situation and those who have bought it during this drop have made a good decision. (See the article on

 

Well the US did just that and look where they are after they've banned shorting. The long and short of it all is FEAR and irrational behavior has taken over the global markets. I thot the most sensible thing to do would be to shut down the markets just as what Russia,Indonesia and Austria did.

Andrew      ( Date: 11-Oct-2008 01:23) Posted: I think the world need to ban shorting across the board, at least for now,  because the markets are really in extreme pessmism and panic. If market fails, bank will fail and business will fail and pple will walk to the street and law & order will break down. I think a good example now is Iceland, a Country on the brink of banktrupucy........ I think like any storms, it will pass. The question is how long ? Great Depression took 10years to stabilize.  Many historian link world war 2 (1939~1945) to The Great Depression and so is a Banker Panic1907 that link to the Great Depression (1930~1954).

 

Yes, agree with Andrew. It was dropping before 8/10 and was paused for a day or so. At then, I was worrying about the free falling after the ban is lifted and it happens now...

someone said that short selling it's a need as some insiders know about certain rotten news of certain company and sell off their shares quickily, but many times shorting is a oppotunity for those speculators besides the geniune selling from the actual shareholders of the company.

The ban of short sell is too quick while the US banks(FAILURE banks) still negotiating the actual value of their assets to be bailout by the govt. I suppose the banks are relunctant in revealing the shrinkage of their assets, especially those sitting on the top are afraid to be accused. Those subprime starters are really selfish and irresponsible. Those bundled the package of fund raising too......very sick in that part of the world.

 

 

 

absolutely right, when volume are thin that's where the bottoming process start..

the volume now is so huge, that is why also don't bother to pick stocks, knowing that it will go down somemore, unless those drastic one like >30% , that's why i nearly got Bayan Tree & Fiberchem yesterday, but, shit.. just 0.01 difference, then, it goes up.. ceh... no luck.

des_khor      ( Date: 11-Oct-2008 01:07) Posted: Market bottom only when the vol are thin , everyone already forgotten the market.....

 

I think the world need to ban shorting across the board, at least for now,  because the markets are really in extreme pessmism and panic.

If market fails, bank will fail and business will fail and pple will walk to the street and law & order will break down.

I think a good example now is Iceland, a Country on the brink of banktrupucy........

I think like any storms, it will pass. The question is how long ? Great Depression took 10years to stabilize. 

Many historian link world war 2 (1939~1945) to The Great Depression and so is a Banker Panic1907 that link to the Great Depression (1930~1954).

 

Market bottom only when the vol are thin , everyone already forgotten the market.....

 

we have seen  STI tested 2,000 level, DJ tested 8,000 level earlier. Not being positive but could mkt have bottom? Thus, regain a gradual recovery after tonite after days of  nosedive?

i have seen previous crisis where it happened after govt & central banks intervention, and it bottomed after continous days of sell down slaughter .

 I certainly hope it's the same this round!

What's yr view?