Thursday, July 23, 2009

Mr. Softee misses, AMZN sells off

MSFT: Won't get worse, but won't get much better

AMZN: Instead of the margin noise, let's look at their acquisition of Zappos. I don't have my Goldman research in front of me, but from this morning Goldman said that AMZN will be able to save $1 per order on shipping, the average ticket on Zappos is $130ish versus $25ish for AMZN, and that Zappos net will be about $20-30 million. That's the story on AMZN, not tonight's margins.

Cramer on his show told people to take some profits tonight and buy a sweater. But then he said tech was going higher. Anyone want to have it both ways?

Here's what Richard Russell of the Dow Theory had to say today:

But next question, did the bear market hit bottom on March 10, 2009? I am doubtful. First of all, valuations on March 9, 2009 did not come anywhere near the typical valuations seen at major primary bear market bottoms -- nor did price earnings ratios for the Dow or the S&P come close. At a true bear market low, the sentiment is beyond bearish, it is total revulsion. At the final bottom, people don't want to hear about Wall Street or stocks. They've been too badly battered, and the losses have been too upsetting and frightening.

Today, just four months after the "supposed March bottom," the public is turning bullish again. At the March 10 low, Lowry's Buying Power Index stood at 96. Four months later, on July 10, Buying Power had dropped to 82. Never in the 78 year history of Lowry's has Buying Power fallen to a new low following a perceived market bottom. In other words, Buying Power now is lower than it was at the March 9 "bottom."

Which means that this after-hours selloff is just profit taking by nervous folks.

And it means nothing.


Anonymous said...

which means time to buy on the dip

X said...

This is scary. ZeroEdge followers are decreasing and Manna followers are increasing .... i liked it the other way

Palmoni said...


Anonymous said...

except for one thing, when people stop buying a market goes down , not up