coach d,
For MOST people the purchase of DWTI and CMD would be an inappropriate trade.
Igy
coach d,
For MOST people the purchase of DWTI and CMD would be an inappropriate trade.
Igy
China is smoke-and-mirrors. All the demand (growth) past a certain point was due to government mandate. What that point was, I don't know, but I would not be surprised if it was 5%.
Now they're on a trip to the mideast, no doubt to try to lock in some future oil at historically low rates. They will probably be told to take a hike by the big players, and maybe ink a deal with Iran for a few years. Good move, in a vacuum.
China QE coming, again. Everything there will be QE. I hope the US doesn't follow, but really, it is the only intervention still remaining, that can produce the "desired" effect.
Forget the Chinese story, and look to the forgotten India as more of a bellweather.
I hope everybody bought on the dip.
Big,
I will be going the other direction.
Igy
You sell on the dip?
Big Dog Investments wrote:
I hope everybody bought on the dip.
Nope. Need to see more going forward, earnings indications, etc.
russell 2000 small cap index now down 23%.
Seriously.
the market is saying things are half has bad as they were during the financial crisis. Insanity. The US is growing steadily, hiring like mad, etc....
I have seen many references lately to sovereign wealth funds selling billions - I think the Saudis sold $80 billion of blackrock products alone.
23%.
Short the rally.
Ghost of Igloi wrote:
Short the rally.
Igy, I know you are bearish and I know you have been right.
But at some point you have to pull in your wins and assume that when the entire world is consumed with sheer terror, it's time to take profits.
agip,
The regime has changed in my view. Market rallies will be sold with lower highs that will end with lower lows.
When interest rates are pegged at zero bad things happen. We have experience nothing of significance yet.
Igy
Ghost of Igloi wrote:
agip,
The regime has changed in my view. Market rallies will be sold with lower highs that will end with lower lows.
When interest rates are pegged at zero bad things happen. We have experience nothing of significance yet.
Igy
interest rates are not pegged at zero
one ultra short interest rate WAS pegged at zero but any rate over the fed funds rate has always been over zero. In the USA anyway.
The real interest rate on the 10 year treasury is solidly positive.
remember that inflation is low - it's the real rate that matters.
agip you drive me INSANE.
"sheer terror"?
"hiring like mad"?
Are you for real? You sound like a huge, credulous drama queen. Seriously, no insult intended, I have a great friend like that. I would never get into business with him, but he's a great guy.
You sound like you can be jerked every which way, by whatever is the flavor of the day. Get a grip, man! Get some conviction. Get some ideas of your own.
I know it's a dog-eat-dog, what-have-you-done-for-me-lately world, but you will meet an early death acting like that, unless you run off all the toxins every day. I suggest you do no less than a 10-miler. Make sure you eat well, too, to avoid (inevitable) ulcers.
I worry about you. As Igy just said, there haven't yet been any very serious effects manifested in the markets.
agip,
Federal Reserve interest rates were pegged at 0-.25% for seven years. The damage is done. Spurred speculation in a wide variety of asset classes but most rampant in the stock market.
Igy
Maserati wrote:
agip you drive me INSANE.
"sheer terror"?
"hiring like mad"?
Are you for real? You sound like a huge, credulous drama queen. Seriously, no insult intended, I have a great friend like that. I would never get into business with him, but he's a great guy.
You sound like you can be jerked every which way, by whatever is the flavor of the day. Get a grip, man! Get some conviction. Get some ideas of your own.
I know it's a dog-eat-dog, what-have-you-done-for-me-lately world, but you will meet an early death acting like that, unless you run off all the toxins every day. I suggest you do no less than a 10-miler. Make sure you eat well, too, to avoid (inevitable) ulcers.
I worry about you. As Igy just said, there haven't yet been any very serious effects manifested in the markets.
some truth to what you are saying - I am a bit reactive - it is a weak link in my investing. but keep in mind I use this thread to vent - I'm not actually doing much in my portfolio during this downturn, and I preach stability to my clients.
but there is substantial fear out there - the Vix hit 30 last week - it has only been that high 3 or 4 times in the last 8 years. That's no joke.
And yes, there is hiring like mad. 2.7 million new jobs, net in 2015.
And I believe those are almost all private sector - I believe government jobs have been flat or down for years.
But in the end, I don't think 'have ideas of your own' is very good advice to most people in investing. Much better to stand on the shoulders of giants. the hard part is finding the right giants to stand on, and to stick with it when things go awry.
Ghost of Igloi wrote:
agip,
Federal Reserve interest rates were pegged at 0-.25% for seven years. The damage is done. Spurred speculation in a wide variety of asset classes but most rampant in the stock market.
Igy
you put way too much influence on the fed funds rate. It's not nearly as important as you think it is. If a company wants to borrow money it has to go to the market and negotiate with the invisible hand, not with Janet Yellen.
And of course inflation is very low.
In the United States, the federal funds rate is the interest rate at which depository institutions (banks and credit unions) lend reserve balances to other depository institutions overnight, on an uncollateralized basis. Reserve balances are amounts held at the Federal Reserve to maintain depository institutions' reserve requirements. Institutions with surplus balances in their accounts lend those balances to institutions in need of larger balances. The federal funds rate is an important benchmark in financial markets.[1][2]
agip,
My view is low interest rates led to mal-investment. One can be on one side or the other on that thought, but the Federal Reserve has pursued a low interest rate easy money policy for seven years. The quarter point move last month was nothing, but evidently it is changing how some view the markets generally.
Igy
"But in the end, I don't think 'have ideas of your own' is very good advice to most people in investing. Much better to stand on the shoulders of giants."
There is some truth in this, but as in all else, there needs to be a balance. And I understand coming here to vent/ruminate, I do it myself.
I am once again growing worried about the possibilities for the future. While I had arrived at the point where I believed the situation would be manageable, I now believe that nobody is competent/willing to perform the required management.
I'm almost on the verge of buying physical gold. Almost, but not quite. I grow more uneasy with each passing day, just trying to stay ahead of regulation, finish projects, and tie up loose ends. There IS economic activity, to be sure, and lots of it--but that's not the issue. The issue, to my mind, is whether or not the activity is worth pursuing. Costs are really beginning to manifest. Is IBM worth buying for $10 if its P/E at that level is 500?
These are strange days, that will call for each of us, at some point, to make a decision--a real decision--about where we are headed, and how. IMO those who waffle, who let others make their decisions for them, will be no better than those who choose unwisely.
I'm spending more and more time figuring out where to live. I will maintain some US economic presence, but probably no individual personal presence, except for periodic visits. That is the kind of thing it has come down to, for those of us who have the realistic opportunity to move. It's about careful geographic hedging. Really, it's a difficult thing. It's almost like trying to predict the markets.
Anyway, in Star Wars-speak, "I'm getting a bad feeling about this." Speaking to a few people last night, I got the overwhelming sense that there is something critical that everybody is overlooking, something seemingly trivial, but which will have a controlling and catastrophic effect--something like the power grid going down in the US, etc.
Maserati,
People are re-learning the fact that when the risk premium is wrung out of stocks a return to equilibrium is inevitable. Still many here will think it is still game on, and I think they will be discouraged at first, and depressed later. The die has been cast, change your mindset now or pay the price later.
Igy
I have been thinking more about agip's statement: "But in the end, I don't think 'have ideas of your own' is very good advice to most people in investing. Much better to stand on the shoulders of giants."
I would say that this is in general correct for the everyman, with the caveat that I would add "...investing [via the markets]." Indeed, I myself have only stood on the shoulders of giants while investing via the markets, and have done well.
The only use I have had for my own ideas, relative to the markets, is when to NOT invest. I therefore have not used ideas of my own in investing in the markets, but rather for the purpose of living my life, of which investing (via the markets or otherwise) is but one part.
I suppose that's what I was trying to suggest to agip, even if only unconsciously. I suppose I was unconsciously telling him that he needed to think for himself in deciding whether or not to remain "in", NOT in how to structure his affairs while he is, in fact, "in".
That's the point I think we've come to, if you aren't going to play with things like shorts: you must decide if you will be in, or out, for the next while. In a sense, I suppose I was talking my book, just like everyone else, since I got out at 16.5k. Since I intend to get back in at some point, it would be in my interest to have everybody head for the exits and drive down prices.
Funny how things work, when you take a closer look at them. This kind of self-reflection is what I do not see in many people, including particular posters in this thread.
Off to a meeting to discuss sale and use taxes. Regulations...
Maserati,
My teammate at Oklahoma State Johnny Halberstadt, a great runner by the way, once told me: "Hell man use your brain that's what its there for."
Today most of Wall Street is sitting on the shoulders of midgets. It is all the same buy stocks regardless of the valuation and deteriorating economic conditions. It is always a buying opportunity. That is just plain bad advice.
Igy