Down goes the Dow

BTC now down 25% from its highs.

Maybe I'll start buying a little.

And now another new high. Life is good!

I’ll vote with my wallet.

Biden ✅

This is a main reason why beating the market is so hard.
it just doesn’t make any sense a lot of the time.
But bet against it and you lose.

this is absurd and makes no sense:

Mag 7: +48% YTD
S&P 493: +7.5%
Russell: just went red for the year again

Agip, I'll admit that it does look a bit skewed, but it does make sense. Maybe a bit exaggerated at the high and low end, but the general trend makes sense.

Remember when we were discussing these things about 6 months ago, i think it was the start of the year, and the observation was made that a lot of retail investors were still sitting out the market after the painful downturn brought on by the Fed's tightening? I wonder if they still tend to be out of the market. It doesn't feel that way.

not sure if sidelined/not sidelined retail investors would explain why investors think only a handful of stocks are worth investing in and if that is sustainable. Maybe because they tend to buy market cap weighted indices and those favor the mag 7? I suppose so .

But the point here is that the vast majority of portfolio managers would never build a portfolio based on this scenario but the market cap weighted SP500 did, and that is working. Hard to beat the market at times like this because this sort of thing isn't supposed to happen to this extreme amount.

at the beginning of the year this poster argued that when a market is rising at a time of declining job openings, the market is about to fall. (or job openings had to rise). but the gap was unsustainable.

SP500 +17% this year so there was no fall.

And job openings have continued to fall.

So this poster was wrong, so far. And would have missed a giant gain if he stayed out of this market. So far the gap has been sustainable. Probably mostly because big tech has been so strong, holding up the index. Which is another answer to the previous post...hard to beat the market when it does things it hasn't done much of in the past.

https://x.com/saxena_puru/status/1743311216188309973

I raised the question of the retail investor participation in the markets more as a consideration of how much further this rally could go.

As for the concentration of the market gains in the Mag Seven, I think it makes sense in terms of tech.'s ability to reshape how business is done, esp. in regard to AI. I see it impacting how businesses work, at very fundamental levels, and how they will need to staff going forward, with commensurate savings in labor costs.

And perhaps most importantly, the very strong earnings being generated by the Mag. Seven companies suggests this shift is real, is being pursued by companies aggressively, and is probably still in its early stages.

That's what I meant when I said it makes sense. And perhaps the exaggerated importance of this move is due to 1) strong growth reported, 2) transformational nature of its produce and its ability to reduce the tremendous cost of labor, and 3) early stage in the transformation.

https://x.com/moonalice/status/1810386071357894866?s=61

yeah the earnings growth and quality is certainly there, in big tech, agreed.

as for the transformational side:

Interesting counterpoint from a GS analyst, whose main argument seems to be 'if this generation of AI were so great we'd know what its killer app would be by now.' So this analyst leans toward the AI surge being false gold.

https://x.com/bruce_arthur/status/1810375420279402676

from early 2024, Good call here on the possibility of a meltup.

and yes, SPX +18% so far this year. Wow.

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Carl Quintanilla
@carlquintanilla
YARDENI: “Now that investors’ recession fears have abated, they’re focusing on company fundamentals .. The possible result: an exuberant meltup phase, which might already be under way and might become irrational .. funded by money moving from interest-paying vehicles into stocks and bonds.” 🇺🇸
@yardeni
$SPX

3:44 PM · Jan 21, 2024
·
164.2K
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Reminder that insider sales are not necessarily bad.

here's one for the record books.

Zuckerberg selling half a billion dollarsish of meta stock just before it rises 50%ish in 6ish months!

Do not sell just because insiders are selling!

GURGAVIN
@gurgavin
MARK ZUCKERBERG HAS NOW SOLD $450 MILLION DOLLARS + WORTH OF FACEBOOK SHARES IN THE LAST 2 MONTHS
$META

11:46 AM · Jan 7, 2024
·
216.2K
Views

Do not agree with linked post on X. He says AI is not designed to solve complex problems, but it's applicability to health care, medicine, biomedical, and just about everything is well known, and far from simple. The god damned thing can write movie scripts, for crying out loud. Bad analysis.

well this didn't mean anything.

From a year ago. Market up 29% over that year.

Game of Trades
@GameofTrades_
Households' net worth is now contracting at the deepest levels since the 2008 Financial Crisis

2:45 PM · Jul 7, 2023
·
795.3K
Views

just seems so easy and risk-free to buy the SP500 now...feels almost like a bond that is very unlikely to fall much.

which can't be good. Buying when things feel safe is probably a suboptimal time to buy.

That's for sure. No big moves, though.

I think it is reassuring hearing Powell yesterday at least mention the possibility of lowering rates. That and the fact that GDP growth and hiring can be easing without any strong recessionary indicators (a soft landing seems likely).

Instead of the SNP 500, though, I tend to nibble on adding to my tech ETF position, and adding a few more shares of Nvidia, for the most part.

Found this thread specifically to say the market does not make sense right now. I thought the S&P 500 was overvalued when it was at 5400 and expected a small correction then. Now we're up another 4%... Kind of wondering where the money is coming from. We've already exceeded basically everyone's prediction for a year end target. I've made more money this year from my investments than from my job... Really doesn't feel like this should continue, but interest rates are expected to drop significantly over the next 18 months...

For the time being, I am putting my extra dollars in a 5% money market account... I don't usually do that, but it would not surprise me at all if we see a 10% pullback at some point before year's end. It's not a bad thing to have a little bigger cushion than usual either.

yeah I've pulled back a little on the margin too...so far not the right move.

actually, Michael Burry, it is very hard. No second inflation spike.

https://x.com/BurryArchive/status/1609768003884941313