stunning collapse JPMorgan Chase it will acquire rival Bear Stearns

[Merch]

Yea, GS was short the mortgage market in August. A lot of Wall street guys want to work there. However, I hear earnings are going to dip this quarter.

My advise is to look for the indices to stabilize and the VIX to come down. You want to see the the indices retest some lows and bounce off them before committing.

For Lehman, I would be suprised if they go under. They are the fixed income market place. I'm looking at them retesting lows but not following through. I have cash on the sidelines right now but looking to either buy an ETF or Citi/GS/LEH. Yes looking at buying Lehman.

BSC was at 9% while LEH is at 25%. Liquidity should not be an issue at LEH even though it's the next smallest.

If you are looking at options market, I would set up a straddle and play the volatility. I would probably go out 6 months. But right now I wouldn't play the options because the premiums are too high. Another thing in the option market, I always calculate max pain. It can give you a sense of where the stock price is going into expiration.

Good luck. I find it easier to let the professionals pick the directionand ride tehir coattails.

[TBH]

Somebody at work just told me he went to cash in January.

Not me! I'm going to ride it out. My investments are pretty well diversified, and I've got a long time frame. And my regular contributions during this period will be good for dollar cost averaging.

At least I hope so. Really I'm not selling now because I have no faith in my ability to time the market. I learned my lesson by buying tech stocks in 1999, when they had already run up too far. If I tried to time it, I'd probably sell low and have to buy high to get back in.

[scfr]

Value fund managers from even reputable brokerages (including Vanguard) have taken a hit due to this.... Who would've thought that Bear turned out to be a value trap?

Well ... yes and maybe ... or maybe and maybe ... For example, Vanguard's Windsor 2 fund holds shares in BOTH Bear Stearns & JP Morgan Chase, so who knows how it will all wash out?

But yes, excellent reminder that this news has broad-reaching effects.

[Broken Arrow]

Well ... yes and maybe ... or maybe and maybe ... For example, Vanguard's Windsor 2 fund holds shares in BOTH Bear Stearns & JP Morgan Chase, so who knows how it will all wash out?

Yes, that's a very good point. Most funds are still going to be fine, in my opinion. Even though I didn't come out and say it, I guess my mind was more on individual companies and stocks.

[Troyrb]

Did anyone see Cramer on MSNBC tell people not to take their money our of Bear Stearns on March 11th?

[Broken Arrow]

I didn't, but to be fair, this is the kind of event that I don't think anyone could have foreseen....

However, now that that's happened, my money is on panic in the streets (Wall and Main street that is). Which makes this a great time to buy financials.

[sweeps]

What a difference a day makes. Stocks up >2% so far.

[Broken Arrow]

Well dang, it sure is! The day is not done yet, but it's a good thing I'm not an active trader.

[Merch]

Hope you guys took my advice and either stayed away from the puts or played the volatility.

I'm calling the bottom is near. Look at a retest over the next week, then I am getting in.

Largest volatilities occur at tops and bottoms.

[Broken Arrow]

Is Lehman Liquid Enough?

[sweeps]

What a difference a day makes.

What a difference another day makes.

Down 2.5% today. This is some serious volatility we're seeing.

[Merch]

No doubt Sweeps. I am looking at the indices to test the recent lows. If it holds then I'm getting in. The more time it bounces of the numbers the stronger that support line.

Yes, BA, I am using technical signals to drive my buying. Yes, more trader metric then investor at this moment. When I research, I start at the macro level, then industry, then fundamental for my target companies, and then use technicals to try to see shorterm what the traders are thinking. It's usually trendlines. I also use stop loss to limit my losses. Again, trader short term due to the volatility.

Good luck all!!! And keep you eyes on the trend lines.

[Broken Arrow]

Hey, I got nothing against day trading per se! Ok, well maybe I do, but if you can do it, more power to you. If fact, they say that you learn the most when you learn day trading... even if you don't use it.

I think the problem is that many individual investors don't realize how deep the deepest end of the pool is. They swim out there ill-prepared, and risk drowning themselves so to speak....

But to me, you are an able swimmer. So, even if day trading isn't my style, it is interesting to hear your thoughts on the matter. In the end, the best kind of research is one that takes in everything; fundamentals and technicals alike.

[cptacek]

One thing I am not understanding about this deal...Bear Stearns is a publicly traded company, right? So, if I personally owned some shares of this stock, how can they force me to sell it for $2? And who is doing the forcing?

[Merch]

it's voted on my shareholders at a special. Majority wins. Since it already seems like a don deal, they must know they have 50% of the votes.