Down goes the Dow

agip wrote:

guesser.... wrote:

my guess is the market will continue to descend until agip,p, bad wigs and others are no longer guessing where the virus will take us because it will be clear. at that time, the market will take stock of exactly where the economy is and react accordingly...

but then i'm just a guesser who thinks the stock market is just gambling... what's that line from rounders? 'if after 30 minutes you can't figure out who the loser at the table is, it's you.' ...or something like that.

How can you possibly think the stock market makes losers of people, when all you have had to do is buy the index, hang on, and make 10 or 11% per year for 40 years?

Ah but agip, if you look at this carefully selected and very convenient for my argument 8-10 year time frame then you'll see that's in fact not true!

Racket wrote:

agip wrote:

it's helicopter money time. Fed will buy a trillion dollars of bonds.

buy gold.

With the price of oil about to free? No thanks, I'll take the cash falling out of the sky

tell me what you mean. I don't understand.

note that the price of gold and the price of oil no longer track eachother.

If you bought AT&T when they were selling rotary phones, and sold it when they were selling cell phones, then it was investing. Everything in between was gambling.

fake futures now UP over a percent.

So some poor schmuck was shorting the Dow on the fake futures site....then the fed acted and he lost maybe 6% in 30 minutes.

oh man that's gonna hurt.

Let's see what happens. IMO, 0% rate cut was priced in last week.

agip wrote:

Racket wrote:

With the price of oil about to free? No thanks, I'll take the cash falling out of the sky

tell me what you mean. I don't understand.

note that the price of gold and the price of oil no longer track eachother.

I don't see inflation increasing significantly in broad markets, especially with oil crashing hard and the price of round trip travel to Paris approaching $1.25 and a few box tops. What will happen is the price of boomer bait will continue to explode though (classic rusted out cars from the 60s/70s, houses with wallpaper and carpet, that sort of thing).

Auto market was already taking a huge sh!t before this got started and if this injects a boatload of cash into the system then I win because I'm holding a ludicrous amount of student loan debt anyways

Racket wrote:

agip wrote:

tell me what you mean. I don't understand.

note that the price of gold and the price of oil no longer track eachother.

I don't see inflation increasing significantly in broad markets, especially with oil crashing hard and the price of round trip travel to Paris approaching $1.25 and a few box tops. What will happen is the price of boomer bait will continue to explode though (classic rusted out cars from the 60s/70s, houses with wallpaper and carpet, that sort of thing).

Auto market was already taking a huge sh!t before this got started and if this injects a boatload of cash into the system then I win because I'm holding a ludicrous amount of student loan debt anyways

I don't really see gold as an inflation hedge...I see it as a crisis hedge. And if the fed sees the need to move rates to zero, buys a trillion dollars of bonds, and great economies are shutting down...that's a crisis that should benefit gold. On the other hand, it should also benefit the dollar, which will slow gold's gains.

but yeah there's no inflation anywhere...unless people lose faith in sovereign debt.

What's the connection you are making between the fed injection and student loans? I don't see that.

although in regard to oil and inflation...some think low oil will strengthen inflation because consumers will have more money in their pockets to spend (spending less at the pump), and that will push up prices.

I have no real opinion.

But certainly the importance of oil to inflation has lessened as we have weaned ourselves from oil in many ways.

Igy,

The productivity effects of the virus are real, and IMO would be deep but short-lived were it not for gov interventions everywhere. As it is, they will be shallower and only possibly longer-lived, so we will see what the total effect ends up being.

But yes those relatively small economic effects might be sufficient to reveal structural weaknesses in the system. A TRUE pandemic would bring the system to its knees; this pandemic will be only a temporary dislocation. The knock-on effects of the pandemic could end up cutting deeper than 34% or whatever the RUT was down.

So far nothing structural, that we plebes know of, has broken. QE to infinity, helicopter money, debt jubilee were all foreseen, and are extensions of existing policy. The system is bending, we will get to see how elastic it is.

We ARE imo entering a different phase wrt debt, with the explicit understanding that the US debt will never be paid back. This mentality could extend to other debt as well, which means that the value of money will decrease to nothing, because that is what is most often loaned and paid.

This will need to be ironed-out. Clearly things will still have value, and we will still benefit from some medium of exchange. This is part of a larger process of monetary shake-out that has been happening.

I hope that equity prices continue to decline, but I also hope that the dollar stays strong or strengthens. Navigating the coming era will prove burdensome.

BTW Mrs. Maserati is very stressed during all of this, not sure why. Maybe because it is making it more difficult/less appealing to me to end up in eur full-time. I will say that there is now greater uncertainty about things and that uncertainty does have an effect, look at what is happening with agip.

Stress levels are elevated.

Maserati wrote:

We ARE imo entering a different phase wrt debt, with the explicit understanding that the US debt will never be paid back. This mentality could extend to other debt as well, which means that the value of money will decrease to nothing, because that is what is most often loaned and paid.

.

how does the world lining up to make 1% 10 year loans to the US gummint square with a new phase of believing the loans will never be paid back?

Look what happened as I was composing my last post. Another step in the ebolution of debt and money.

Maserati wrote:

A TRUE pandemic would bring the system to its knees;

What classifies as a true pandemic? I can come up with a million doomsday scenarios that would "bring the system to its knees," like a meteor hitting earth.

agip wrote:

Maserati wrote:

We ARE imo entering a different phase wrt debt, with the explicit understanding that the US debt will never be paid back. This mentality could extend to other debt as well, which means that the value of money will decrease to nothing, because that is what is most often loaned and paid.

.

how does the world lining up to make 1% 10 year loans to the US gummint square with a new phase of believing the loans will never be paid back?

The two are most certainly not mutually exclusive. Quite the opposite. And it’s contagious to other loans, like student loans.

20 minutes til the real futures open. I think many many people are going to be hitting f5 together.

A communal experience.

I'm curious to see if the fake futures correspond to the real ones.

Maserati wrote:

agip wrote:

how does the world lining up to make 1% 10 year loans to the US gummint square with a new phase of believing the loans will never be paid back?

The two are most certainly not mutually exclusive. Quite the opposite. And it’s contagious to other loans, like student loans.

I'll read your explanation if you want to go into detail. But I'm not officially asking.

agip wrote:

20 minutes til the real futures open. I think many many people are going to be hitting f5 together.

A communal experience.

I'm curious to see if the fake futures correspond to the real ones.

Lol. I'm down a lot on my investments, but at least the last couple weeks have been really exciting =)

A true pandemic is one that destroys the system, the underlying structure. This isn’t it. Even the fed action just now is the same system acting in the same manner.

Not enough healthy qualified people either able or willing to show up to keep the power on, the water flowing, the goods flowing—that is a real pandemic.

TAA wrote:

agip wrote:

20 minutes til the real futures open. I think many many people are going to be hitting f5 together.

A communal experience.

I'm curious to see if the fake futures correspond to the real ones.

Lol. I'm down a lot on my investments, but at least the last couple weeks have been really exciting =)

isn't that a curse? 'May you live in interesting times'