I got 22% last year.
Something like this was due. Just wish we'd get to the goddamn bottom already.
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Stock Market Era |OT3| Nobody expects the Spanish Inflation!
- Thread starter Sheepinator
- Start date
- OT
I got 22% last year.
Something like this was due. Just wish we'd get to the goddamn bottom already.
I understand that 2020-2021 was insane, obviously my comment was somewhat tongue-in-cheek. But does feel like those 22-30% gains everyone was getting are maybe a touch... not real? I can't think of the right phrase for it. It feels like there was a price to be paid for a global pandemic and everything that happened from Aug 20 - Aug 21 was kind of fake in a weird way. Obviously if you sold and locked in profits bless, way to win.
But the bulk of my portfolio is long-term boring index retirement stuff, and it's funny to see this insane bubble and slow popping of that bubble.
The word for what you're describing is "bezzle":
Why the Bezzle Matters to the Economy
carnegieendowment.org
OP
OP
The SNAP collapse seems a bit much, but remember the market may be pricing in not just one quarter of weakness, but a full year perhaps. And SNAP did themselves no favors by just announcing they'd come in below previous estimates, without quantifying how much below. If they'd said 3% below or even 10% below, the stock probably wouldn't be down 40% this morning.
On the topic of ad spending, won't that pick up in the second half due to the midterms?
On the topic of ad spending, won't that pick up in the second half due to the midterms?
The word for what you're describing is "bezzle":
Why the Bezzle Matters to the Economy
Michael Pettis on ERA, man you know he's gotten bigger when I'm no longer the only one posting his stuff, lol.
Edit: To add to the Oddlots discussion, this was the best one they did all year, with Currie, but it jives what I think is coming, which is a shift towards deregulating the banks. I'm sure I'll get teh side eye, but so often sheet and ratios are the reason for a host of things, something has to give.
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I think I posted his stuff a while ago too :D He's great, especially his most recent book.
Hmm, that's pretty close to what I'm thinking but not with as much sinister undertone. There's a certain delusion to the euphoria of the lockdown run, but i don't think that people who profited off of it were ne'er-do-wells necessarily.The word for what you're describing is "bezzle":
Why the Bezzle Matters to the Economy
Yeah man you have, I remember, it's just crazy to me for some reason because this dude went from having his blog hacked all the time to this, lol.
Edit: Then again it's also wild that Roubini is pushing blockchain stuff, lol.
Some of the delusion was probably overly optimistic thinking about the change of lifestyle the pandemic would accelerate and make common place. Remote work, remote doctor's visits, death of the movie theater, death of the gym, outdoor activities, shopping in person, etc. Turns out people like face to face interaction and old businesses are going to drag their feet for decades in adopting remote work.
So while those companies growths shot up because they were actually performing very well, the mistake was thinking it'd be sustained. It's why I never bought into Zoom, Peloton, Teladoc, etc. On the other hand I did think something like Amazon's growth would be sustained.
In the end mostly everyone is getting it wrong besides Buffet lol
It's got a lot of users and it is in its infancy of starting to monetize, which is going really well and they are cash flow positive with a positive balance sheet. They are just getting thrown out with the bath water.
The tech isn't overly special although they have very good image search algorithms but for me what differentiates them from other social media stocks is people are going on there with the intent to purchase and they don't rely on getting user data from other sources as the users are directly searching for things. It's probably going to be more equivalent to an Etsy in 5 years than it is to a Snapchat.
Should they have been $80 so soon? Probably not. But they are quietly executing their business model and continually beating revenue expectations.
Ha I've bought PINS on several occasions and said the exact same thing, it's always gone wrong, single figures and I'll try again
Good luck!
What investing platform do you use?
Most of them these days let you buy fractional shares during day time trading hours.
I've not looked into Etsy at all, but been reading up more on their business more and more to understand why they've been successful and what the appeal is. I've never shopped there.
Despite very large headwinds for probably for the next couple of years this seems like a great opportunity?
hmmm, yeah I agree. Bad poll question
Despite very large headwinds for probably for the next couple of years this seems like a great opportunity?
hmmm, yeah I agree. Bad poll question
Afaik it is still mostly a US thing. None of the platforms I would want to touch in Europe supports it at least.
Low volume on green or red days tells me liquidity is drying up, but that just increases volatility.
This market wants to stair step into a bear market. Death by a thousand cuts indeed.
Edit: TSLA down more than GOOG. We might see TSLA below 600 tomorrow.
This market wants to stair step into a bear market. Death by a thousand cuts indeed.
Edit: TSLA down more than GOOG. We might see TSLA below 600 tomorrow.
Liquidity drying up makes me think of the repo issues around 2018...
2020 stocks only go up.
2022 stocks only go down.
The Federal Reserve is going to start taking liquidity out of the fixed incoming market starting in June. Could be a concern for sure. Though the sell off on the weekly chart has been at 50 week average volume or better.
Lower volume would normally mean a slowing down of selling too. Since you typically need higher volume to drive the market lower. Notice how the higher volume spikes are almost always associated with down moves. Lower volume is normally on the bullish side.
I'm watching this 50% retracement level on the QQQ very closely right now. On the 15 minute chart, candles swinging around it trying to pick a direction.
Personally, this 50% retracement level is a big level to me I would prefer the QQQ to get back over and hold. Because I think a lot of other dominoes fall depending on which way this breaks.
Though even if the low is in, I'm still not expecting that V recovery . Likely closer to a W, or even a WW over months. Check out the SPY or QQQ daily chart from the flash crash in August 2015 through 2016. That flash crash was near the actual low, but it was still very volatile for months after.
If we actually got some sort of V recovery, would be pleasantly surprised. This is more from a fundamental point of view that a lot of companies are guiding lower, and SP500 earnings per share estimates haven't been brought down yet.
I would love this area to be the bottom for my ego haha, since I was always targeting this range of SPY380-400 and QQQ 260-280. It was a combination of technical aspects and fundamentals of P/E ratios needing to come back to normal. However, I didn't really factor in a material slowdown from the consumer that we could possibly be seeing, and earnings growth potentially deteriorating faster than anticipated. So this might end up being a miscalculation on my original estimates. If the fundamentals keep breaking down in terms of lowered earnings growth, that means the current forward P/E of 17 on the SP500, plus the forward P/E on a lot of companies, is wrong and too high. Which means prices should go lower, because the fundamentals don't support higher prices. However, there will never be a flare sent up to tell us this ahead of time from the news. Market will front run whatever event is about to transpire, so this is the importance of watching all these levels.
2022 stocks only go down.
The Federal Reserve is going to start taking liquidity out of the fixed incoming market starting in June. Could be a concern for sure. Though the sell off on the weekly chart has been at 50 week average volume or better.
Lower volume would normally mean a slowing down of selling too. Since you typically need higher volume to drive the market lower. Notice how the higher volume spikes are almost always associated with down moves. Lower volume is normally on the bullish side.
I'm watching this 50% retracement level on the QQQ very closely right now. On the 15 minute chart, candles swinging around it trying to pick a direction.
Personally, this 50% retracement level is a big level to me I would prefer the QQQ to get back over and hold. Because I think a lot of other dominoes fall depending on which way this breaks.
Though even if the low is in, I'm still not expecting that V recovery . Likely closer to a W, or even a WW over months. Check out the SPY or QQQ daily chart from the flash crash in August 2015 through 2016. That flash crash was near the actual low, but it was still very volatile for months after.
If we actually got some sort of V recovery, would be pleasantly surprised. This is more from a fundamental point of view that a lot of companies are guiding lower, and SP500 earnings per share estimates haven't been brought down yet.
I would love this area to be the bottom for my ego haha, since I was always targeting this range of SPY380-400 and QQQ 260-280. It was a combination of technical aspects and fundamentals of P/E ratios needing to come back to normal. However, I didn't really factor in a material slowdown from the consumer that we could possibly be seeing, and earnings growth potentially deteriorating faster than anticipated. So this might end up being a miscalculation on my original estimates. If the fundamentals keep breaking down in terms of lowered earnings growth, that means the current forward P/E of 17 on the SP500, plus the forward P/E on a lot of companies, is wrong and too high. Which means prices should go lower, because the fundamentals don't support higher prices. However, there will never be a flare sent up to tell us this ahead of time from the news. Market will front run whatever event is about to transpire, so this is the importance of watching all these levels.
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Sure. I'm not sure how badly prices are going to fall, but they are starting to go down.
Are there other options? The impression I have gotten is that their toolkit isn't exactly all that broad for this specific issue.
I think we are already starting to see some deflationary pressures happening.
1) Home sales are really starting to drop
2) Companies are beginning to freeze hiring and start layoffs
3) Stock market has come down greatly already
4) Inventory turnover is slowing down for companies
Now we have to see how big of an economic effect this all has. Target and Walmart earnings basically said inflationary pressures have the consumer stepping down in quality and not buying as many high margin items. Now consumers are buying lower margin items, in which walmart and target don't make any money on these items. Plus what baseline level does inflation go down too. If it goes down to 4-5 percent and sticks, that's not a great scenario either.
If anyone has any insight on the housing market, let us know. Because Florida and California are now looking at legislation to help with first time home buyers. In which spending more money doesn't exactly bring down inflation. But the housing market is looking close to completely broken right now between year over year price increases and how much 30 year mortgage rates have gone up. There probably is no good solution here, outside of having it crash again.
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Stolen from Reddit:
www.forbes.com
Tesla Stock Losses Top $575 Billion As 'Investor Patience Wears Thin' With Elon Musk's Twitter ‘Circus Show’
Shares of Tesla plunged to an 11-month low on Tuesday.
www.forbes.com
OP
OP
It was very lucky for Musk's brother to sell out right at the top, just before Musk started selling. And when I say lucky, I mean lucky that he's related and obviously got the advance warning.
Another 50% and I'll buy some!Stolen from Reddit:
Tesla Stock Losses Top $575 Billion As 'Investor Patience Wears Thin' With Elon Musk's Twitter ‘Circus Show’
Shares of Tesla plunged to an 11-month low on Tuesday.
I think we'll start to see signs of inflationary pressures easing when investor sentiment starts to move to 'risk on' mentalities. Too many defensive plays going on right now...
Rate hikes will do it; you just have to give them time. After all, the Volcker shock didn't fix inflation overnight, either.
Inflation has as much to do with the psychology and expectation of inflation as it has to do with money supply vs demand. Persistent inflation can become a self-fulfilling prophecy, which is why you want to get ahead of wage-price spirals as quickly as possible.
Some folks are pointing to anecdotal evidence to say that this is already underway. For instance:
Microsoft CEO Satya Nadella tells employees that pay increases are on the way
Microsoft is paying up in areas like cloud computing to avoid losing talent to top rivals such as Amazon and Google.
www.cnbc.com
I don't think we're there yet.
Yeah it's a good thing to look for. Though be careful if the rotation doesn't happen. If the defensives fade and the rotation doesn't happen, this is a recipe for faster market crash on the SP500 and QQQ. The slow moving crash will accelerate.
I was just looking at the SPY and QQQ daily charts, and neither have touched their 20 day moving average in a long time. SPY barely tagged it 25 trading days ago, and it's been 33 trading days for the QQQ. That's crazy. I'm actually kind of impressed how the QQQ and SPY haven't evolved into a bigger price crash by constantly getting sold down underneath the 20 day moving average. The 20 day is just magnetic enough to have these hold on, but not strong enough to pull them back yet. The last two and half weeks has been very choppy sideways action in a big range, but as long as the SPY or QQQ don't break down from here again, the 20 day is going to come down to meet price and we will see what happens.
It looks like SNAP insiders unloaded a ton of shares too over the past year. Not to mention Satya Nadella selling half his Microsoft shares near Microsoft's top. Fed Chairs finding clarity and selling their individual stocks near the market top, before actively pushing the market lower. The grift was so strong the last couple years
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I'm totally on capitulation right now -- I don't really have any faith that there will be any significant movement on the upside anytime soon, especially because the 20ma is the big resistance point right now.
Someone posted something a while back that said 'Just in time turned into Just in case'. Looking quite apropos right now.
Also, there's lots of downhill effects of increased inventory too (read: increased prices).
Isn't more supply than demand a reason to lower prices? Or are inventory costs that high?
Sorry -- I'm talking more about company inventory, not generalized market supply.
One of the (many) reasons why global supply chains helped to reduce prices is because inventory is always an added cost/liability on the balance sheet, on top of warehousing and such. To compensate for holding more inventory, a company will typically charge more to offset the risk of not selling that product. With good supply chains and JIT, a company can hold much less and thus sell for a corresponding lower price.
Now take the pandemic and broken supply chains: not only is there no supply, but companies are hoarding stuff Just In Case. That hoarding, along with increased demand from consumers due to real or perceived shortages, leads to increased costs for consumers. And that doesn't take into account the knock-on effects as *multiple* companies may be looking for the same stuff, leading to perpetual shortages as suppliers retool.
----
All of this is the main reason why I think the Fed's efforts will ultimately fail because the problem with the current inflationary environment isn't a monetary issue. In fact, an argument can be made that their tightening efforts may make things worse. Many of the inflation indicators can be argued from the supply side -- Chinese supply chains, lack of oil production, etc -- and yet many key figures are arguing for a monetary solution. Ultimately, they're flailing around for some semblance of control, and they're not going to find it.
The Fed can only do so much when it comes to the supply side though.
If inflation gets out of control, JPow will do absolutely everything in his power to cool off demand, hence rate hikes.
The problem is if the Fed is forced to raise rates too quickly, it can cause a recession. The ugly truth about a recession is that it will lower inflation but at what cost (crashing the market and layoffs).
If inflation gets out of control, JPow will do absolutely everything in his power to cool off demand, hence rate hikes.
The problem is if the Fed is forced to raise rates too quickly, it can cause a recession. The ugly truth about a recession is that it will lower inflation but at what cost (crashing the market and layoffs).
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There's barely any stock and construction stalled during the pandemic. Those toxic bundled subprime loans of 08 are not a thing anymore.
I don't see it happening.
This refrain about housing crash is getting tiring. This is an INCREDIBLY different situation compared to 2008- comparing the two is silly.
At the local level, there is essentially no inventory right now. Houses in my town are going 40% above listing due to this inventory shortage.
At the local level, there is essentially no inventory right now. Houses in my town are going 40% above listing due to this inventory shortage.
What happened in '08 was beyond a crash, the system was fundamentally broken. I'm talking a good old conventional, 30% drop in value, crash. Housing starts are down, sales were down 17% last month yoy, lumber is off 60+% from it's high and heading back to pre-covid levels, interest rates are rising quickly, etc. Just go on zillow and look and see how many houses have had their prices dropped recently and you'll see it for yourself. My business is tied to the real estate market and we're battening down the hatches for a bad second half.
The housing inventory issues are going to just get worse in my opinion. As the Fed continues to raise rates and inflation jacks up the price of rentals, what motivation do I have to sell when I have a locked mortgage with at 2.75% interest? Maybe if I'm forced to move, flush with enough cash to not take a mortgage, or whatever - maybe. But now you have high gas costs and the COVID world of remote only isn't sticking quite like people expected. IMO housing near a city center with a lot of job options is a huge perk - especially at low interest rates people have locked in.
I could see a crash when it comes to people who over leveraged multiple properties and it cascading down into more reasonable prices for homes in some ways, but I just don't see that having a domino effect on the average home buyer. Too many would still love to own a home in these areas and might be willing to bite at high interest believing they can refi later.
I could see a crash when it comes to people who over leveraged multiple properties and it cascading down into more reasonable prices for homes in some ways, but I just don't see that having a domino effect on the average home buyer. Too many would still love to own a home in these areas and might be willing to bite at high interest believing they can refi later.
Houses in my area are still selling quite well, but I agree overall that it's going to cool.