Down goes the Dow

Bitcoin $39,761

The carnival barker thinks this dip is near its bottom, if that’s useful information for anyone:

https://www.cnbc.com/2022/01/20/jim-cramer-says-the-stock-market-is-getting-closer-to-forming-a-bottom.html

doc idiot wrote:

This strikes me as a critical point at which the future is completely unknown and likely to be markedly different than the present in ways yet to reveal themselves.

Well put, that is exactly how I feel.

Maser wrote:

doc idiot wrote:

This strikes me as a critical point at which the future is completely unknown and likely to be markedly different than the present in ways yet to reveal themselves.

Well put, that is exactly how I feel.

Greed and fear at play in your minds, gents. Careful.

“ Jim Cramer says the stock market is getting closer to forming a bottom”

There is no content to this, other than “the markets are falling”.

Agip, greed idk...fear, absolutely.

agip wrote:

Maser wrote:

Well put, that is exactly how I feel.

Greed and fear at play in your minds, gents. Careful.

my hunch is that traders are looking for a bottom, over the last several sessions. Like today, futures were up and pre-market solidly up, but faded the open. That much is known,

Why?

The issue is not omicron nor Ukraine, both of which the market could assign some approximation of risk moving forward. What is unknown is the more direct influence of how the market can weather further gains without stimulus from the Fed. The time for raising interest rates and cutting bond purchasing is upon us, and so buyers are simply reluctant to buy the dip with the backing from the Fed that it has grown so comfortable with,. A wait and see posturing, so hence, lack of buyers stepping up to follow-through with keeping a bounce going.

I'd watch for a couple of days of rebounding in a row, perhaps more.

agip wrote:Greed and fear at play in your minds, gents. Careful.

Greed? Dunno…

Fear? More than I care to admit

the market does fine when the Fed is raising rates. Not 100% of the time, but on average. I don't see why it would be different this time. The Fed is raising rates because the economy is roaring. That is a good thing.

the VIX woke up today, which is good, but still just 26. I'd really like to see a spike over 30, preferably to 35. Not enough fear quite yet.

But stepping back, remember two of the most important investing lessons:

"Don't do something! Just stand there!"

and

"Impulse is the enemy of good returns."

All that said, the most important part of investing is to have a plan you can stick to through good and bad. At this point in my worry-addled mind the most I can handle is around 60% in stocks, which is what I have now. Generically, 60/40 portfolios are down just 1% over the last month. Just noise. I can stay invested being down 1% in a month, no problem, so my returns should be solid, risk adjusted.

If someone has so much in stocks that they can't handle a 7% correction without impulse selling...then probably they need to reduce their allocation to stocks.

(not speaking to anyone specifically here - talking generally)

Maser wrote:

If things drop seriously, what will reflate the markets? Lowering rates again? Strong economy? Pure price inflation?

Look at every major correction or mini crash over the past 5 years. What do they all have in common?

1) Twitter bears smugly declaring the end of the modern financial system (finger wagging, "I Told You So," the rich shall be eaten).

2) Massive V shape recoveries to legendary all time highs.

There is absolutely nothing wrong with this economy right now - in fact, we have so much demand and so much money that we literally don't have enough bodies to meet the current labor demand! GDP last year was 6% and is expected to be like 4% or more this year, and we're at under 4% unemployment which no one even thought was possible just 10 years ago.

But every other dipsh!t on social media would have you believe we're Wiemar Germany with our 7% inflation. You know who those people are on Twitter? And oh no a bunch of 20 somethings are upset because they can't buy their dream house right of college and life isn't fair :(. Bunch of fvcking losers just clogging up the system with noise.

I remember so well in the fall of 2018 when I was absolutely certain the market was gonna crash and the Fed was gonna raise interest rates. But agip kept saying "just look at inflation and TIPS, the rate hikes are unjustified and the market is trying to tell the Fed." I brushed it off and called him a retard probably, idk, seems likely.

A month later, guess what? The Fed admits that the rate hikes are kinda unjustified given the lack of inflation. Epic V shape recovery followed and I went from being up like 300% on a short position down to like 2% up. I had to scalp wheat futures the rest of the year to bring my portfolio back up. Fvcking wheat futures!

Always look at the big picture and don't fall for the doomer sh!t that passes for "insight."

On BTC...it's now clear that it's just a tech stock with no earnings or dividends.

It seems directly correlated with tech stocks.

Which takes a leg out of the reasons for owning it.

agip wrote:

On BTC...it's now clear that it's just a tech stock with no earnings or dividends.

It seems directly correlated with tech stocks.

Which takes a leg out of the reasons for owning it.

BTC 38,700

If MSFT falls to 281 and AAPL to 147, I might go all in both. 50/50 portfolio in my Roth.

agip wrote:BTC 38,700

... and free falling ...

Ditto GME.

Is this when Igy's prediction finally comes true? S&P 500 back to 1500 or lower?

I have no idea where this is going to stop; as I wrote yesterday, I think we're at a critical point, as often arrives in chaotic phenomena, and what happens now need have no real connection with what's gone before. Hold on for a bumpy ride, everyone, hang on for dear life! I hope everyone found a seat when the music stopped...

Vix got to 29...that's better.

it hit 31 before the big December rally...maybe 29 is close enough.

I don't even remember why we hit VIX 31 in early December. Was that Omicron's discovery in South Africa?

These crises just go away. Would be amusing to go back over 7% drops in the SP500 from 5 years ago or more and read about the false worries that caused them. The worries we don't even remember anymore.

agip wrote:... These crises just go away...

I guess that's your take on this one? I hope you're right. I'm staying in my seat when the music starts playing again... :-)

VS-SJW-IR-TS idiot wrote:

agip wrote:... These crises just go away...

I guess that's your take on this one? I hope you're right. I'm staying in my seat when the music starts playing again... :-)

yeah well my only take on much is that a 60/40 portfolio is very unlikely to lose money over a 3-year span.

that said, buying stocks when down 7-12% is historically a pretty good strategy if you have a long time horizon.

I believe the next phase will stealthily attack mega cap growth, with investors believing the playbook of the last five years is still relevant. Over time confidence will erode while waiting for the bounce back that never comes. Portfolio sales will come in mass 50% lower than today.

Ghost of Igloi wrote:I believe the next phase will stealthily attack mega cap growth, with investors believing the playbook of the last five years is still relevant. Over time confidence will erode while waiting for the bounce back that never comes. Portfolio sales will come in mass 50% lower than today.

You and agip have diametrically opposing views of the future, it seems. I prefer your take, not that it is necessarily more likely (I have no FREAKING idea), but that by choosing to believe it I better protect my retirement.