Down goes the Dow

From this post by The Honest Broker ( Ted Gioia ), you might find it interesting.

honest-broker.com

The Most Dangerous Thing in Culture Right Now is Beauty

Ted Gioia

You think I’m crazy, but just wait and see....

Link:www.honest-broker.com/p/the-most-dange...

thanks I'll take a look this weekend.

Interesting talk going on about this sort of thing. How 'beauty' has become a political football. How beauty feels retrograde, right wing, and to be avoided to many leftists. Crazy stuff.

I've been trying to disengage with twitter, with some degree of success.

Image:i.imgflip.com/82gijr.jpg

Kobeissi Letter:

“JUST IN: The US posted its 3rd largest deficit on record in 2023, spending $1.7 TRILLION more than it brought in.

This was a $300 billion increase in deficit spending compared to 2022.

The US is now spending 44% of GDP per year, the same levels as World War 2.

We are now spending a higher percentage of GDP than what was seen in 2008.
US deficit spending is officially higher than what was seen in 2008, one of the worst recessions in history.

How is this not getting more attention?”

Earnings Scorecard: For Q3 2023 (with 6% of S&P 500 companies reporting actual results), 84% of S&P 500 companies have reported a positive EPS surprise and 66% of S&P 500 companies have reported a positive revenue surprise.

finally starting to get some payoff in bondlandia from these high coupon rates.

my favorite bond fund, VCSH - short term corporate bond fund - has returned 4.5% over the last year. So these high coupons are finally overwhelming capital losses in funds. We all knew that would happen eventually - now sounds like the time. That will help 60/40 portfolio performance quite a bit.

The SEC yield on that fund is 5.8%, which is pretty remarkable for a plain vanilla corp bond fund with a duration of just 2.6 years.

As Israel and the US dabble with starting WWIII, will the market finally reflect how bad things are and tank this week?

Agip - on your tombstone (from many years from now) we will put "he always gave it his all."

I love to see a scary tweet with a 'head in sand' insult. Well I love to see them afterwards, when putting head in sand turned out to be the right move. Again.

This big account did the standard 'this is 2008 all over again and people just want to ignore it' thing and yeah will it's not 2008 all over again, yet anyway.

Stocks up 5% since then and bonds down 5%. I suppose he was right on bonds - that's a big loss for 6 months. But a balanced portfolio did ok.

@JeffSnider_AIP
·
Apr 20
AYFKM!
People really want to put their heads in the sand about this. But this really is 2008 stuff here.
Another huge downdraft.

Time to bet against the shekel it seems.

“The great bubbles take their time. Quite a few years going up. Quite a few years coming down, and the market suffers from attention deficit disorder, so it always thinks every rally is the beginning of the next great bull market. My guess is that we will have a recession, I don’t know if it will be fairly mild or fairly serious, but it will probably go deep into next year. Every bubble has been greeted with a chorus of ‘soft landing,’ and there’s never been one. Each cycle is different, so each cycle, something else happens. It’s always a surprise, but you always have a surprise, so the very idea of a surprise is unsurprising.

I would argue you have to be brave buying when prices are extended and high, because you’re much more likely to lose money. The real bravery to buy when the market is smashed down to a bargain seems to me to be very little. That is not now. If you look at the most predictive measures, and Mr. Hussman does the best of those – very detailed historical record of which ones actually do the best – those measures are about as high as they’ve ever been, today. They’re in the top 2 or 3 percent of all time. There’s a spike in 2000 and a spike in 2021, and this is above 2000 but below the spike in 2021, but we are right up there.

In order to get the market down to where it would typically outperform the long bond by 5%, which you could argue it should, the market, just sheer arithmetic would have to drop by more than 50%. This is not my forecast. I have a very genteel forecast where anything below 3000 would make me think it was reasonable, and if everything works out badly, which it sometimes does, I would not be amazed if it went to 2000 on the S&P, but that would require a couple of wheels to fall off. And wheels tend to fall off when the great bubbles unravel, but it doesn’t mean they have to. It would be unlikely not to get to something close to 3000 on the S&P. You can’t get blood out of a stone. Sooner or later, the simple arithmetic suggests that you’ll either have a dismal return forever, or you’ll have a nice bear market and then a normal return, and the nice bear market will hopefully be less than 50%.”

– Jeremy Grantham, GMO, Bloomberg UK (abridged), October 5, 2023

How long before we're back at all time highs? Mid 2024?

No, 2034.

the SP500 has gone nowhere since July 12, 2021.

826 days

118 weeks

27 months

2.2 years

“Over the coming decade, from current valuations, we expect the total return of the S&P 500 to lag Treasury bond returns by about -6.5% annually. Our 12-year estimate is even worse, at -7.5% annually. That may seem preposterous. It’s easy to forget that we observed a similar outcome in the years following the 2000 extreme. During the 12-year period from 12/31/1999 through 12/31/2011, the total return of the S&P 500 lagged the total return of Treasury bonds by -8.9%. It’s equally easy to forget that the total return of the S&P 500 lagged Treasury bonds from August 1929 to July 1950, and more recently, from March 1998 to March 2020. Bubbles have consequences.”

—John Hussman, October Market Commentary

Did I miss anything good?

You mean besides a hell of a roller coaster ride?

I got that part in the market lol, I mean here on Letsrun.

I assume everyone is still the same ol'? Did agip get his excessively priced and over-styled Fiat? Is Jerome "Maserati" Powell still running the US Federal Reserve from hi Swiss chalet?

Has Igy admitted that he was wrong about anything at all yet (lmao jk on that one)

Things have been quieter in general. Maz. has gone AWOL, though there was a brief episode where he was posting under an alias, presumably because he was being tracked, or some such thing, but that was quite a while ago. Igy and Flagpole have a bet about value of the SNP 500 at the close of '23, and lots of chest thumping there. LOL.

Igy having some good results with short term swing trades on the shorting side.

Fair amount of rear view mirror stuff about all the market analysts that got it wrong about the impending "23 recession, esp, dating back from about a year ago, though admittedly, a very few got it right,Side excursions into the likes of iBonds and much to do about the gyrations of long and short term bonds.

Others feel free to chime in.

But where the hell have you been? Hmmm?