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Thread: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

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    Default dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    ... depending on the results of this week's Massachusetts special election !



    (snip)"
    Jim Cramer, the bombastic host of CNBC's Mad Money, is predicting a stock rally if Republican Scott Brown wins in Tuesday's Massachusetts Senate race. Here's his monologue from yesterday evening:

    "The number you need to watch is the number that Scott Brown racks up against Martha Coakley in this amazing Massachusetts Senate race...Even a few weeks ago it was a lock for Democrat Coakley. But now everything's up in the air, and a Brown win would be devastating for the president's agenda...particularly on health care reform, because Republican Brown has said he will definitely vote against the plan.

    Brown in the Senate? That wrecks the 60-vote supermajority the Democrats have been counting on. It could spell the end for this almost year-long nightmare of a piece of health care legislation.

    What does a Brown election mean...? Well, first you're going to get a knee-jerk rally in all the so-called penalized stocks -- the HMOs, the drugs, the medical device-makers. I call it "knee-jerk," though, because these stocks have been on fire for months...It's been clear as a bell that the health care reform wasn't going to affect most health care stocks. That's versus what we thought last year.

    More important, though, I think that investors who are nervous about the dictatorship of the Pelosi proletariat will feel at ease, and we could have a gigantic rally off a Coakley loss and a Brown win. It will be a signal that a more pro-business, less pro-labor government could be in front of us...How about a little bit less like the old Soviet Union? Yeah, that would be a bit more like it. Pelosi politburo emasculation!

    Cramer, a supporter of President Obama, has become increasingly critical of him"(snip)


    Dollar Den 'rules' require that every thread have at least 50% economic content, and this topic arguably has a HUGE economic impact. The 'breaking' of the filibuster-proof senate majority via the election of Scott Brown could immediately lead to the legislative death of national health care, carbon cap and trade, 'recycling' of TARP money paid back by US financial institutions, gov't subsidies for home / car / appliance purchases, and a host of other very expensive proposals.

    If these economic 'threats' were to be removed from the heads of US businesses, as Kramer points out this could lead to a huge boost in US private sector business confidence / investment / hiring / profitability ... which in turn could result in a huge US stock market upward bounce.

    At any rate, any potential 'dice rollers' might want to consider buying a few index call options or leveraged index ETF shares prior to the special election ! I already placed a buy order for some DDM shares as a pure 'gambling bet'.

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    God/dess Zofia's Avatar
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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    More politics! Where is the moderator? Oh, she's the biggest offender.

    Z

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    Quote Originally Posted by Zofia View Post
    More politics! Where is the moderator? Oh, she's the biggest offender.

    Z
    Government has no influence on the economy?

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    Veteran Member XxAmber89xX's Avatar
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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    This is a major shift in the Massachusetts Senate race if it does occur, but I don't know if it will be the tipping point in causing a stock market rally... It would be interested to see as there is alot of $$ on the sidelines waiting for something...

    The ironic truth is Wall Street, ahem 'bankers' give alot more $$ support to the Democrats than the Republicans.
    Oh Canada, we stand on cars and freeze...

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    Banned Melonie's Avatar
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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    Point #1 - it is a proven fact that the majority of stock market price movement in any given year can be traced back to a handful of 'events' that trigger large market moves in the matter of a single day / few days.

    Point #2 - risk tolerant investors stand to gain ( or lose ) big time by correctly ( or incorrectly ) front-running such 'events' when it is possible to do so ... as it certainly is in this particular case.

    Point #3 - for better or worse, at this particular point in time the enactment ( or abandonment ) of proposed US gov't policies with major potential economic / financial impact are likely to have a profound effect on US business operating costs, thus US business economic outlook going forward, thus US business stock share valuations !!!


    Like the recent Dubai debacle, or the Lehman Brothers bankruptcy, it isn't always possible to front-run such 'events' because they simply come out of the blue ( to the general investing public at least ). But in this particular case, the date of the possible 'event' is well known in advance. Thus IMHO at least, failing to bring this potential 'event' to the attention of risk tolerant Dollar Den readers would have arguably constituted negligence on my own part.

    ~
    Last edited by Melonie; 01-18-2010 at 11:23 AM.

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    1 / 19 bought DDM at the open for $45.38 ... closed at $46.40 ...
    Mass election results late tonight

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    OK I'm out on this one ...

    Even though the MA special election will put a Republican senator in office, and thus vastly compromise the ability of new health care legislation, new carbon tax legislation etc. to be passed, these days the US economy is also subject to major effects from foreign sources. In this particular case, out of the blue, China decided to issue a gov't directive to its own banks to severely restrain future lending, which had a surprisingly large negative impact on stock exchanges around the world.

    (snip)"Stocks fell in Asia and Europe today after Chinese regulators told some of the nation’s banks to limit lending.

    China Curbs Lending

    China will restrict overall credit growth in the nation to 7.5 trillion yuan ($1.1 trillion) this year, banking regulator Liu Mingkang said. Some lenders were asked to rein in credit because they failed to meet regulatory requirements including those for capital, Liu, chairman of the China Banking Regulatory Commission, said in an interview in Hong Kong. New loans in the first 10 days of this year were “relatively high,” he told the Asian Financial Forum.

    “Expect earnings to grab the headlines today, but the focus is also on what China is doing,” said Angus Campbell, head of sales at Capital Spreads in London. “It looks like the Chinese are starting to place some constraints on liquidity, which may put a cap on their expanding economy but also have a larger effect on global growth.” "(snip)

    from

    The two major 'takeaways' from this development are probably that ...

    A - China now has a larger impact on the US economy than America does on the US economy

    B - Major US corporations now have a huge 'chunk' of their business activities / profits located in China or at least connected to China

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    No silver bullet. I make a list of risks, weight how much they (should) effect a symbol, purchase decision from there.

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    ^^^ agreed on investments in general, but this wasn't an investment it was a 'dice roll' that actually wound up resembling a poker hand because new 'players' joined the game. And new 'player' China 'called' the US voters' 'bluff' while holding the monster stack of chips !!!

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    so much for the supposed "brown rally" the dow had been down since, didn't se the number today.

    Not the first thing JC has been wrong about. Believe he said Bear stearns would never go under too.

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    Quote Originally Posted by phonehome View Post
    so much for the supposed "brown rally" the dow had been down since, didn't se the number today.

    Not the first thing JC has been wrong about. Believe he said Bear stearns would never go under too.
    Dice roll is right!

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    ^^^ in fairness, it's necessary to mention that Obama's serious proposal to selectively tax / limit large banks has served to severely 'tank' the value of financial stocks thus also 'tanking' stock indexes in which large banks are a major component. For better or worse, non-market forces are still driving market valuations.

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    Quote Originally Posted by Melonie View Post
    ^^^ in fairness, it's necessary to mention that Obama's serious proposal to selectively tax / limit large banks has served to severely 'tank' the value of financial stocks thus also 'tanking' stock indexes in which large banks are a major component. For better or worse, non-market forces are still driving market valuations.
    For a perfect market there needs to be perfect information and this has been a major major problem for a long long time. I think this is far more a problem than government intervention has been (for now - as time marches along I may change my tune to meet future circumstances.)

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    Default Re: dice roll - Jim Kramer sees potential windfall opportunity depending on ...

    ^^^ are you referring to the (re)adoption of FASB 'mark to make believe' accounting standards for Investment Bank derivatives last spring ? Arguably, that single regulatory change was responsible for at least 50% of S&P index gains which have occurred since !!!

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