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Traffic Spike?

Is there any contrary indicator component to (bearish) blog traffic? I wonder . . .

Note the trend over the past 30 days:
>

Sitemeter traffic to the Bigpicture as of 1/19/08 7:42am

>

I assume the huge increase in traffic this month is (partially) a function of the market turmoil. But geez, that's a pretty big bump.

~~~

For the record, I do not consider myself a "bear" -- Its just that I try to find the truth, search out the facts of the matter. As Rob Corddry once asked, "How does one report the facts in an unbiased way when the facts themselves are biased?"

For the past few years, the macro-economic circumstances have been moving towards the exact issues now causing problems . . . 

Saturday, January 19, 2008 | 08:34 AM | Permalink | Comments (74) | TrackBack (1)
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Comments

The traffic increase had to do with the attention drawn to your site by Doug Kass and the bear trend.

Posted by: John Borchers | Jan 19, 2008 8:43:26 AM

Capitulation soon by the look of that chart. At first I thought it was a market volume chart.

Posted by: chris | Jan 19, 2008 8:50:44 AM

People 'been quoting you various places. e.g., I first found your site via a link on Eschaton last year. Also - those predictions you lucked out on?

Posted by: Mind | Jan 19, 2008 8:54:35 AM

The collective lizard brain is saying "We Want Answers and we want them NOW!". Some of the people reading here probably have actual folding money ready to invest -or- want to know when it will be safe to stop worrying about their 401k.

I jumping back in two days ago and went from 100% cash to 50%. I came in 1 day too early, but some of what I bought went up yesterday. I think this is a bottom, but my 50% remaining cash is ready to average down if need be, or to buy into a timidly rising market, probably next week.

And I plan to make a lot by having bought / buying all the sectors that fell disproportionately further than others. They will rise the most, relatively speaking, and probably faster.

I think we will see a rising market to S&P 1480 this spring, more or less. A summer dip might follow unless great earnings news is prognosticated for the summer. I doubt the S&P will hit 1550 this year. But anyone who buys soon will make money for sure.

People are reading you because they want to know what to do. At this time, this is both what I plan to do and what I have done. BTW, I'm 100% cash because I sold everything on 11-1-07. (I can't stop patting myself on the back for that one.)

Posted by: cinefoz | Jan 19, 2008 9:03:26 AM

You'll see an even bigger spike when people lose their jobs and have plenty of spare time.

I am a contrarian also. As I said before...the bears will be proven wrong - they aren't bearish enough.

Posted by: Steve Barry | Jan 19, 2008 9:15:58 AM

If you look at Birinyi's blogger sentiment poll, the new bears have mainly come from the ranks of the neutral crowd...the core bulls are stubborn.

http://tickersense.typepad.com/ticker_sense/blogger_sentiment_poll/index.html

Posted by: Steve Barry | Jan 19, 2008 9:22:32 AM

I agree the bears are far too bullish. I pulled out my 401K money from the stock market Dec 4,97. So far so good.

The question I have is how much borrowed money still exists in our stock market and global stock markets at this time. Anyone using margin lately has likely potentially doubled their losses.

If too much borrowed money exists in the stock market because it hasn't gone down in 5 years I think S&P 750 is possible.

During 2007, speculation was driving the market higher each day: China growth, metal prices will never sink because of demand, solar is unstoppable, etc etc. Each day there was a reason to drive the market almost 1% higher every few weeks.

I think the banks are nearly done with subprime writeoffs. There will be some credit card writes and other loans which go bad but not as high as previous. The real surprise will come in lack of earnings power with the oversized debt they have now. These 7-10% coupons are going to be a killer when you can't afford many risky loans.

But still in my view the bankrupted banks (yes, I believe C and MER are broke) are not at the heart of the problem.

Speculation is.

The pullbacks as all kind of investments go red will be felt around the world just as it did during the great depression. Losses will be realized and as a cost of those losses some gains have to be taken. After all isn't this what we are seeing now in BIDU, AAPL, RIMM, FSLR, China, Korea, Japan, etc etc?

Earnings power throughout the world has decreased from 2006.

The growth was fueled by speculation and inflation. When you pull away the inflation or reduce it and earnings power reduces that tells you where the profit power came from.

Posted by: John Borchers | Jan 19, 2008 9:35:55 AM

John Borchers,

You may be interested in this article about a sub-prime type issue with stock margin loans.

http://www.businessspectator.com.au/bs.nsf/Article/Shares-hidden-downside-AWRKP?OpenDocument

Posted by: Steve Barry | Jan 19, 2008 9:50:35 AM

Your predictions for 2007 S&P were spot on. That brought you traffic

Posted by: Blonde Vigilante | Jan 19, 2008 10:43:20 AM

Thanks for that link very good article.

If there's one thing I'd love to know it's how many times wikipedia got hits on stock market crashes lately. I would bet it's exponential.

Posted by: John Borchers | Jan 19, 2008 10:44:28 AM

BR,

I am a frequent visitor -- regardless of markets being up or down -- because I can relate well to the realist/skeptical tone in the commentaries and interesting articles/ links available thru the web site.

Suggestion: How about starting a twice a week market sentiment poll for your web site visitors?

Thanks.

Posted by: Nikhil | Jan 19, 2008 11:06:23 AM

Let's not forget Kudlow. He's been the biggest and best advocate for your blog.

He's the reason I found it and he's recommended it on his show for umpteen times in the last few years.

Never mind that it IS the best, most informative, most objective financial blog, and the most inviting to reasonable participation anywhere... Still, Kudlow has in my estimate easily contributed 15% or more of your readership. He's been an absolute funnel.
---
BTW, a philosophical question:

According to the awards cited here by the granting associations referenced:

http://www.ambac.com/

...Is it perchance fair to ponder who might have been on their short lists?

...Or to wonder further if next year's awards would require solvency for nomination?

Posted by: Eclectic | Jan 19, 2008 11:15:07 AM

Sites like your's and Panzer's have been talking about the risk from sub-prime, Alt-A, and the proliferation of credit swaps, CDO's, and the like for awhile. While everything was going kosher, not a lot of people were concerned. Now, everyone wants to find out what guys like you were talking about Barry. I'm just glad I found your site a long time before that and plan on continuing to be a loyal reader.

Plus, you've got great commenters. ;)

Posted by: Florida | Jan 19, 2008 11:17:20 AM

It's actually historically low on a monthly basis (though the month is not over). Check out August...that's the highest in 12 months. So, your site views are kind of like the VIX.

http://www.sitemeter.com/?a=stats&s=sm2ritholtz&r=33

Posted by: Josh | Jan 19, 2008 11:21:40 AM

Well John, here's how many times Google got hit:

http://google.com/trends?q=stock+market+crash

Posted by: That Guy Drinks Beer | Jan 19, 2008 11:23:32 AM

I believe there is still a chance that we can get out of this mess without too much collateral damage.

$150B fiscal stimulus to buy time + 100bp rate cut should stimulate consumer activity, capital investment, housing sales, auto sales, etc. (Remember that most people operate on a cash flow basis. If the cost of a home/auto loan goes down, they will buy more house/car with their monthly payment)

100bp would lower the cost of mortgage resets and reduce the percentage of defaults.

It would also lower the value of the dollar and once the equity markets have shaken out, foreign investors will rush in to buy our multi-nationals on the cheap, lifting equity prices. (unfortunate but necessary after decades of irresponsible debt accumulation)

Without aggressive action, the US will fall into a serious recession/depression and bring down the global economy with it. Then, all bets are off!!!

btw, not usually a Krugman fan, but today's op ed (Don’t Cry for Me, America) is 100% on target . Guess he is a pretty good economist when he is not in the "I hate Bush" mode.

Posted by: bsneath | Jan 19, 2008 11:37:29 AM

It's a shame you can't require a little psychology test to view the site. Then you could show a little bar chart of the grief stages. Probably a lot of flippage from bargaining to depression this week. Or maybe a personality inventory so we could watch the little dots migrate over to the fear/loathing quadrant as the lizard brain takes over. Endless infoporn possibilities there.

Posted by: Roger Bigod | Jan 19, 2008 11:47:56 AM

Barry,

It is obvious to me that the effects of the red pill are wearing off - perhaps the masses watched you fly across the sky with your spot-on projections, but mostly it is your non-biased approach - I believe millions of us are sick of "spin".

Also, from what I have seen, you have the most sophisticated and best managed comments section of any blog - and keeping it that way is surely a time-consuming and/or costly task.

I am honored that I am allowed to contribute.

We appreciate the work you do and the voice you grant us.

Thanks.

Posted by: Winston Munn | Jan 19, 2008 11:48:33 AM

WE LOVE YOU MAN.... Group hug!

Posted by: Ross | Jan 19, 2008 12:05:44 PM

I think you need to take seasonality into account as well. While it is still a big jump, the days of - and just prior to - the holidays make the contrast appear larger than it would otherwise be. My guess is that half the jump is attributable to travel schedules.

Posted by: Noah | Jan 19, 2008 12:09:32 PM

I'm looking for nekkid pictures of CNBC news babes. Why is everyone else here? :)

Posted by: MAS (Seattle) | Jan 19, 2008 12:20:15 PM

bsneath,

I enjoyed your comment above but have some reservations about your conclusions. You and I seem to be somewhat in agreement that this thing could still go either way, but while you tend to the positive bias, I, on the other hand, tend to the negative bias.

I don't see the stimulus package as all that big of deal - and the markets didn't seem to care much for it, either. The problem to overcome is pychological, not monetary - it is time preferences that need be addressed. Fear and apprehension close pocket books. It does no good to furnish $150B if that infusion simply goes into a savings account. Obviously, not everyone is impacted the same way, and while some may rush to spend, I believe the percentage to be much lower than anticipated. And my reasoning is from the recent retail holiday spending - down not because there is no money or credit available, but down because perception of time-preference has changed.

A large Fed rate cut still does not address the problem - the credit squeeze is in the capital markets, out of the reach of Fed intervention. Yes, we can blame the Fed for allowing the shadow banking system to gain control - and now that it has, the normal banking system is but a bit player in the production.

Bernanke spoke of this phenomenon in his Jackson Hole Speech.

Again, it is a time-preference problem. During the mania, buyers felt as if they were compelled to buy in order not to miss out on the explosive housing event; now, the urgency of buying is being replaced with "wait and see" preference.

I am still greatly concerned that a deflationary recession is building steam, and once begun, will not be undone without much pain and suffering.

Posted by: Winston Munn | Jan 19, 2008 12:26:12 PM

Theres not too much good to read today except this blog so I started a model. For each 5 years I took the S&P500 open for the first week of Jan. For 1950 it's 17 and 2005 it's 1211.

I found that with minimal differential average (trying to keep the actual S&P values as close as possible to the projection) to the actual S&P500 numbers the gain per year in the S&P500 would be around 7.98% not including divendends, inflation or anything else.

I found it interesting that with this projection the gains for the last few years are only slightly ahead of the model.

This simple model shows that in Jan 08 S&P500 1426 should have been about where we opened the year and by Jan 09 we should get to 1539.

However, if we are entering anything like the 70's where in 1975 I'm showing a -66% differential from the model S&P500 would be at 850.

Posted by: John Borchers | Jan 19, 2008 12:33:28 PM

You da best!

Posted by: brbrown | Jan 19, 2008 12:36:38 PM

red pill?... ya, they've all switched to those little "blue" pills.

Posted by: Stuart | Jan 19, 2008 12:37:49 PM

December 2008

Sun	Mon	Tue	Wed	Thu	Fri	Sat
	1	2	3	4	5	6
7	8	9	10	11	12	13
14	15	16	17	18	19	20
21	22	23	24	25	26	27
28	29	30	31