Down goes the Dow

Good, if the upward trend continues I will invest in the sewer. Then again your danube steak may prove to be a tube steak. Cow lips and connective tissue tastes good on the way down, but dangerous to your financial health. 😷

Ghost of Igloi wrote:

Good, if the upward trend continues I will invest in the sewer. Then again your danube steak may prove to be a tube steak. Cow lips and connective tissue tastes good on the way down, but dangerous to your financial health. 😷

On the bright side, I'm pretty sure Hussman won't be getting too many calls from his clients about any repercussions of the proposed capital gains tax regulations! And if he does, it's not due to anyone investing in his funds.

😹

Ghost of Igloi wrote:

All the good news priced in. MSFT will be cut in half over the next year. Bookmark it.

well Igy...sorry man. You nailed XLE to the back wall, but this was not a good one.

A year ago Igy predicted MSFT would be cut by half, to $100.

Instead it's at $310 and paid a 1% dividend.

All in all, up 44% since Igy's prediction.

Hey Igy, you asked me to do it.

agip wrote:

Ghost of Igloi wrote:

All the good news priced in. MSFT will be cut in half over the next year. Bookmark it.

well Igy...sorry man. You nailed XLE to the back wall, but this was not a good one.

A year ago Igy predicted MSFT would be cut by half, to $100.

Instead it's at $310 and paid a 1% dividend.

All in all, up 44% since Igy's prediction.

Hey Igy, you asked me to do it.

$Trillions of QE and Govee recklessness does wonders. OK, MSFT will be cut by 75% over the next year. Bookmark it agip.

🌭

Ghost of Igloi wrote:

agip wrote:

well Igy...sorry man. You nailed XLE to the back wall, but this was not a good one.

A year ago Igy predicted MSFT would be cut by half, to $100.

Instead it's at $310 and paid a 1% dividend.

All in all, up 44% since Igy's prediction.

Hey Igy, you asked me to do it.

$Trillions of QE and Govee recklessness does wonders. OK, MSFT will be cut by 75% over the next year. Bookmark it agip.

🌭

how about predicting the demise of DWAC also?

It's down 66% already from last week.

agip wrote:

Ghost of Igloi wrote:

$Trillions of QE and Govee recklessness does wonders. OK, MSFT will be cut by 75% over the next year. Bookmark it agip.

🌭

how about predicting the demise of DWAC also?

It's down 66% already from last week.

I would say good chance it will be worth zero in a year. Less to do with Trump, more to do with SPAC structure. Hope Sally didn’t buy at the high. 😹

Ghost of Igloi wrote:

agip wrote:

well Igy...sorry man. You nailed XLE to the back wall, but this was not a good one.

A year ago Igy predicted MSFT would be cut by half, to $100.

Instead it's at $310 and paid a 1% dividend.

All in all, up 44% since Igy's prediction.

Hey Igy, you asked me to do it.

$Trillions of QE and Govee recklessness does wonders. OK, MSFT will be cut by 75% over the next year. Bookmark it agip.

🌭

Not likely, but it would still be light years ahead of HSGFX.

Johannes wrote:

Ghost of Igloi wrote:

$Trillions of QE and Govee recklessness does wonders. OK, MSFT will be cut by 75% over the next year. Bookmark it agip.

🌭

Not likely, but it would still be light years ahead of HSGFX.

Not at all. MSFT had record earnings, based on this quarter and using a fair value model of 16 x earnings would result in $173. MSFT was trading at 16 times EPS within the past five years. That is not ancient history. I assume recessionary earnings reduced by 30% easily gets you to down 75%. In fact it is reasonable, if not a likely outcome. Sure fairy tale market could continue another year, but that does not negate the ultimate outcome.

Paging Signore Racket,

Check out how much Robin Hood profits off option traders.

https://twitter.com/mebfaber/status/1412272196026724356?s=21

Ghost of Igloi wrote:

Johannes wrote:

Not likely, but it would still be light years ahead of HSGFX.

Not at all. MSFT had record earnings, based on this quarter and using a fair value model of 16 x earnings would result in $173. MSFT was trading at 16 times EPS within the past five years. That is not ancient history. I assume recessionary earnings reduced by 30% easily gets you to down 75%. In fact it is reasonable, if not a likely outcome. Sure fairy tale market could continue another year, but that does not negate the ultimate outcome.

Note that mister softee has had an astonishing 17 straight quarters of double digit revenue growth.

That suggests a target PE of closer to 26 than 16.

Assuming ‘bubble’ instead of ‘remarkable growth’ might be a mistake.

the more I read the more I think that the 'supply chain' issues are 80% increased demand and 20% covid/lack of worker issues.

did you know that the number of shipping containers moving through Long Beach is at an all-time high, something like 20% higher than pre-covid? That suggests Americans are simply very rich and spending out the wazoo. Which might explain some of the inflation too.

In any case, high-spending americans make me more bullish than bearish, that's for sure.

agip wrote:

Ghost of Igloi wrote:

Not at all. MSFT had record earnings, based on this quarter and using a fair value model of 16 x earnings would result in $173. MSFT was trading at 16 times EPS within the past five years. That is not ancient history. I assume recessionary earnings reduced by 30% easily gets you to down 75%. In fact it is reasonable, if not a likely outcome. Sure fairy tale market could continue another year, but that does not negate the ultimate outcome.

Note that mister softee has had an astonishing 17 straight quarters of double digit revenue growth.

That suggests a target PE of closer to 26 than 16.

Assuming ‘bubble’ instead of ‘remarkable growth’ might be a mistake.

https://twitter.com/thestalwart/status/1453285978580336646?s=21

Another view on future revenue growth:

Ghost of Igloi wrote:

agip wrote:

Note that mister softee has had an astonishing 17 straight quarters of double digit revenue growth.

That suggests a target PE of closer to 26 than 16.

Assuming ‘bubble’ instead of ‘remarkable growth’ might be a mistake.

https://twitter.com/thestalwart/status/1453285978580336646?s=21

Another view on future revenue growth:

https://twitter.com/LizAnnSonders/status/1452688264914161665

I like the explanation given in the Twitter post above, by someone named Larry: "Obviously the strongest growth comes after the trough."

Which is rather obvious when you think about. All of which is pertinent in that even if the strongest return on stocks are already realized, that is not to say that there may very well be further returns on stocks ahead.

Nasdaq currently within a half of a percent of its all time highs.

The so-called growth of the last five years is a function of $Trillions in QE and Government spending. So very little of this is organic growth, therefore strongest manufactured growth is induced by QE and Government spending. The obvious effect is on prices of a host of assets, but also producing an unexpected large rise in inflation. Common sense alone tells one this fake set-up is a house of cards. However, as long as investors believe there is a free lunch further positive stock market returns (and other assets) will continue.

Igy, yes--but the rise in inflation was hardly unexpected. In fact, it has been happening for some time.

And don't make the mistake of thinking that there was some pure state of grace 5 years ago from which the current climate sprung off.

The effects of the "fake set-up" are everywhere, the trick is to maximize it where you want it, and minimize it where you don't. Boise in RE for you is good, Hussman is mediocre to negative, and a gas guzzler is yet more negative.

Of course these are simplifications, and the judgments obtain only in the current climate. The lather-rinse-repeat cycle is too tempting, and is time-tested.

small caps down 3% in two trading days

dern machines.

agip wrote:

small caps down 3% in two trading days

dern machines.

appears trade in a tight range, don't you think?

Maseratl wrote:

Igy, yes--but the rise in inflation was hardly unexpected. In fact, it has been happening for some time.

And don't make the mistake of thinking that there was some pure state of grace 5 years ago from which the current climate sprung off.

The effects of the "fake set-up" are everywhere, the trick is to maximize it where you want it, and minimize it where you don't. Boise in RE for you is good, Hussman is mediocre to negative, and a gas guzzler is yet more negative.

Of course these are simplifications, and the judgments obtain only in the current climate. The lather-rinse-repeat cycle is too tempting, and is time-tested.

My turn to rant Maserati….

Well if phony growth has no negative consequences, we should take the Fed balance sheet from $8.4 Trillion to $12.4.? And instead of 60% of the population paying no taxes, why not 80%? And to take my real estate up another 30%, why not a 30 Year Fixed Mortgage at 1%? There is a limit to this nonsense, and when it is reached this bubble pops. Period the end, it will not be smooth or transitory. My humble opinion of course.

In regards to gas guzzlers, I remember all the Hummers, jacked up trucks, four wheelers, snow mobiles, and RVs parked around town with for sale signs back in 2008-2012. How about all the dumping of technology stocks 2000-2006? We bought our first house in Boise from an over extended Micron employee in the early stages of the first tech bubble. Abandoned unfinished sub-divisions in 2010. House across the street the owner walked away. Pipes froze, bank took possession, pipes froze a second time. $330,000 note on the place, sold at auction for $120,000 four years later. Where did that money go, Fed Balance sheet? This insanity is not zero sum. Daughter evicted a squatter where the bank couldn’t get her out for five years of non-payment. Its crazier this time, the distortions of the last two bubbles have been magnified by more reckless behavior. I laugh at how stupid it is, and how clueless society is. But Maserati the globalist elites want it that way, while spouting out their propaganda of doing it all for the down trodden. When people get squeezed they’ll wise up to their being pawns in an unfair system.

Igy