Stock Market: Major Happening?
- Thread starter Suhrreal
- Start date
On the back of a 1 trillion pre-covid deficit, and a 2.4 trillion covid bailout. We should make sure to thank our kids and grandkids for the short term sugar high that the current generation has created....
It's too early to say where the actual recovery will be in another month. For sure unemployment will continue to decline (that part is no mystery) BUT will we actually ever get back to pre-coronavirus levels and if so, when.
Right now I'm waiting to see if there will be a virus set back from all the exposure at these protests. This coming week should start to be telling one way or the other. I don't really expect young protesters to suffer much but the secondary infections to their parents and grand parents could be bad IF that happens. And if there is no outbreak from the protests then the lockdown measures were probably bogus to begin with.
Right now I'm waiting to see if there will be a virus set back from all the exposure at these protests. This coming week should start to be telling one way or the other. I don't really expect young protesters to suffer much but the secondary infections to their parents and grand parents could be bad IF that happens. And if there is no outbreak from the protests then the lockdown measures were probably bogus to begin with.
Nasdaq hit the all-time high on Friday.
People should be very, very concerned if they have money in the stock market.
People should be very, very concerned if they have money in the stock market.
Yep. It will probably clear it a little and then go down hard when the second wave hits in a couple weeks.
Yeah, those protesters didnt social distance. It's gonna hit hard.
Yeah, those protesters didnt social distance. It's gonna hit hard.
In the late 20s/early 1930s weimar Germany tried something like this. Their market kept going up. Problem was their currency went down just as fast.
So in other words... nobody knows.
Riding the back of the govt stimulus it should. Plus all the money coming back into the market now that the coronavirus has been exposed.
Definitely buy the next big dip.
That's the problem...I don't think there will be a next big dip. Think it may just shoot straight up. Minor pullbacks will def be bought up though.
As for people talking about coronavirus...I think they put Fauci out to pasture. Highly doubt we are shutting down again and protesters don't strike me as the type to hit the stock market hard.
Concerned...but at the same time, we could still see a massive squeeze up. The shorts will relent more and more pushing us higher. The way Trump talks about the economy -- it's like he knows something we don't. It really is a different kind of confidence coming off of him that I haven't seen before.
And of course after I post this the futures pull back, but we still have 12 hours until open.
There will be another dip but not down to the 18,000..Been told the Market will Hovered around 24,000- 28,000 for a year or two..
There is always a big drop when it goes up like that. Just got to be ready, which is difficult.
The problem is the FED dropped the neutron bomb immediately this time. That never happened before.
We already saw that. This is the product of 2 things: 1. foreign holdings being transferred into the stock market and 2. A race to the top by the smart money with the intent of pulling out.
I predicted this to happen in late summer, but the Saudis have bumped the timeline up with massive investments into several AAA companies, Boeing in particular. They are using their foreign holdings to do so and I have a feeling that their motivation is not only to buy into stocks but also decouple from the dollar because they have a huge budget deficit and need to be able to devalue the riyal. When that happens, buh bye oil stocks and potentially our reserve currency status.
End of the year at best before the slide begins. Maybe a bump right before the election if it looks like Trump is going to win (no, not a political statement), but this is going to be bad, bad, bad.
Not exactly the same scenario, but the premise is similar. The difference is we aren't printing the stock market higher in real time, this is printing and borrowing from the past coming back. We're also losing the trade leverage we would have had from a devalued dollar in the interim.
There are more shorts to be blown out. The Saudis did their buying over a month ago. Boeing and American Airlines exploded last week thanks to shorts getting blown out. There were people talking about both of those companies possibly going bankrupt and trading accordingly. They got annihilated.
I do not think we drop any time soon either. As always, the interest rates will be the thing to watch, and I don't think they dare increase them again in the short term. I think Trump even mentioned something about negative rates. My belief is a ton of money is going to stay locked up in stocks for quite a while.
I was playing them while they were down. Now I'm a little uneasy about them. I think Boeing has some juice left to squeeze along with other defense plays. Boeing is still roughly 50% off all-time high and the volume last week was incredible. Even though commercial airline production is going to take a hit, they are still in aerospace, drones, weapons, military, etc. Amazon is going to start converting commercial airliners into cargo planes. They will have the MAX recertification coming up as well.
Not sure about AA but Boeing sold like 30 billion worth of bonds last week that helped drive their stock higher. There was something in the range of a trillion dollars invested in AAA bonds last week, and JMO but I think we start to see that becoming more and more of a trend, both in corporate bonds but also Treasuries, which are going up. And let's be honest, the FED can't just keep buying back Treasuries indefintely, and at some point foreign holdings has to come into the fray, especially with the shitshow in Africa, Russia, and the Middle East. That .9 or 1% on a 10 year treasury looks awfully good if im holding a bunch of US dollars sitting in the middle of a country on the verge of bankruptcy. Its the safest investment in the world right now.
It's likely the over reaction that typically occurs. The market reacted way too severely to the downside when the pandemic hit, now IMO it's reacting too strongly to the bounce back although the rationale by many is there has been a huge amount of stimulus added to the equation.
All I know is I was down 112K in my 401K and now I am back to 10K gain. It's a start! Only 29 more years until retirement!
Given the trillions of dollars our government gifted a few weeks ago, our currency has no where to go but down. That being the case, where do you put your assets as a hedge against inflation? Some would say gold but that has already had a huge run up. Commodities like corn and beans? People have to eat and the corn market especially has been destroyed oil prices and ethanol plant shutdowns. I don't know what the answer is but the volatility is scary but you don't want to be caught holding much cash in an inflationary economy like ours almost has to be. I suspect some of the run up in the stock market has been foreign investors looking for a relatively safe haven during a time of world turmoil. That is still the U.S.
The fundamentals of the US economy are so weak. Almost every industry is contracting in a major way. Hard to say when there is a major pullback, but I see it as inevitable. Investors plow ahead on any good news, but there is so much bad news on the way
Yet local plants in my area are doing well. Orders for big ticket construction items are holding up. Smaller plants orders are doing well given the time of year. I don't know. The auto industry and housing market has me a little spooked. Builders in our area really pulled in their wings in February yet they seem to be staying busy with smaller jobs. The old saying used to be as the housing market goes so goes the U.S. economy. In my area anyway there is still a shortage of new construction starter homes. I don't think many of the people on TV protesting will be buying a new home any time soon. I suspect real estate values in downtown areas are going to suffer.
It's the polar opposite as far as housing goes for me out in NC. They are still cranking them out like hot cakes. I was thinking it may slow up, but nope. They are going nuts in my area anyway.
There's a lot of ways to either hedge or invest for inflation. Gold runup is minimal at this point. It's going much much higher. Silver is better anyway. How high? See how much more they print when the second quarantine/second wave hits in a couple weeks after these protests where absolutely nobody was social distancing. Maybe I'm wrong but I'm listening to doctors on this one.
The debt problem is worse per capita than 1929. They're not done printing or even close. The dominos are going to crash hard. There's a reason Powell (fed reserve head) is out there practically begging congress to send out more checks to people. He knows what's coming.
But.... In short, own real things that haven't already had debt based run-ups over the last 40 years. It's not as hard to find as you think. Art and collectible cars or tractors is an example.
In other words, property won't be a good inflation hedge unless it produces a real good. Housing will implode when they have to raise interest rates. If they can't raise them or don't... trust me we are SCREWED.
Investing in yourself or your family's education? Depends. Because education has had a debt based run-up in cost too.
Starting a business? Depends on if you can do it with minimal debt.
Debt can still be used but there are issues there that nobody knows how they will play out. And I mean nobody.
I've got my ideas. They're working so far for what it's worth.
Wow Boeing up 12% again but watch out below...treasury buying suddenly went green.
Inflation investment can be put into one very simple statement.
Paper is poison.
In plainer english... pretty much any stock and bond will get demolished one way or another. Resource stocks do well. That's pretty much it.
Buy real stuff. With cash.
Paper is poison.
In plainer english... pretty much any stock and bond will get demolished one way or another. Resource stocks do well. That's pretty much it.
Buy real stuff. With cash.
When you say housing will implode, what do you mean? Actual home values will decrease? Interest rates will soar? Many will not be able to own housing?
Regarding our currency, thats not necessarily true, at least in the short term. Our model leads more to Japanese style deflation for a while, I'm guessing a couple of years. After that, all bets are off and I'm guessing major, major inflation.
BPN is right about silver and gold, I think those are two of the best bets if you're looking for something other than the dollar. If you go heavy into cash, just make sure you spread it around among banks, don't stick it all in just one institution. Banks will be the last domino to fall but they're going down too. T-bonds might be the safest place of all through the deflationary period but you arent going to make a fortune, obviously.
Think 2007/8. Same thing. Maybe worse. They did not learn their lesson somehow.
Add in an aging population to the equation and a small surplus of inventory is going to be a big one in 5-10 years.
To stop inflation, interest rates have to go up. Real estate will get crushed and you can't just sell a building quickly.
The banks are probably going to end up nationalized if it goes that far. At least the depositor aspects of it so people have their money. Things might close but they won't be allowed to stay closed. Those riots last week will look tame.
to me, the markets and cnbc are screaming for the mom and pop retail investor to get back in.. just in time for the coming big sell off.
don't be caught holding the bag.
if you bought when everything tanked, you should be taking profits now.
as far as inflation is concerned, oh yeah, it's coming sooner rather than later, but not in all markets...
I can see food prices going up. Your avg fast food meal is going to be over 10 dollars by the end of the year.
Housing though, I can't see how they can inflate that any more than it already is. Housing is already too expensive and maybe it can go a little higher, but seriously doubt people can afford much of an increase from prices today.
Commercial property is going to be really cheap for awhile. There might be a case for buying commercial property to transform it into residential housing, if you can get the zoning worked out with the local officials.
Used car prices are already super low, so I could actually see those prices rebounding. Buy a nice used car now while they are cheap I guess.
New car prices have to go up. Unit sales are down, so I think per unit price has to go up.
Gold, maybe it will act as a hedge against inflation, but as soon as it goes up, who are you going to sell it to?
I have a hard time finding places to put one's wealth to be honest. Over the long term, the stock market it probably the safest place, unless you think the dollar is going to crash and burn, which while possible, every other currency out there would have to burn first, and unless there was some grand move into crypto, which is still a scam right now, you're probably better off staying sort of diversified and in the system.
Where do you see putting your wealth to take advantage of the coming inflation?
don't be caught holding the bag.
if you bought when everything tanked, you should be taking profits now.
as far as inflation is concerned, oh yeah, it's coming sooner rather than later, but not in all markets...
I can see food prices going up. Your avg fast food meal is going to be over 10 dollars by the end of the year.
Housing though, I can't see how they can inflate that any more than it already is. Housing is already too expensive and maybe it can go a little higher, but seriously doubt people can afford much of an increase from prices today.
Commercial property is going to be really cheap for awhile. There might be a case for buying commercial property to transform it into residential housing, if you can get the zoning worked out with the local officials.
Used car prices are already super low, so I could actually see those prices rebounding. Buy a nice used car now while they are cheap I guess.
New car prices have to go up. Unit sales are down, so I think per unit price has to go up.
Gold, maybe it will act as a hedge against inflation, but as soon as it goes up, who are you going to sell it to?
I have a hard time finding places to put one's wealth to be honest. Over the long term, the stock market it probably the safest place, unless you think the dollar is going to crash and burn, which while possible, every other currency out there would have to burn first, and unless there was some grand move into crypto, which is still a scam right now, you're probably better off staying sort of diversified and in the system.
Where do you see putting your wealth to take advantage of the coming inflation?
Thats what I fully expect. The FED is already the defacto world bank so it only makes sense that the US will nationalize our banks.
Crypto will always be a scam. They may go there but it will still be a scam.
Here's the thing... investing over the last 40 years has been about going outward -- finding someone to make you money.
Inflation investing is inward. It's about protecting.
There are things that will do well. Tesla might be a decent bet on huge dips as an example. Their competitors will get destroyed and then some in most cases.
Personally I bought a kia niro last year. 50 mpg most of the time (issues with winter but overall I love the car). Odds are that car goes UP in value if inflation hits like i think.
And I can still get around a bit. How many people will be able to travel for say... estate sales if gas hits 10 bucks a gallon? What about higher?
The point with what I'm saying is inflation investing is more about efficiency and having stuff instead of paper.
It's not insurmountable. Just have to know your priorities.
Similar threads
Latest posts
-
-
-
-
Softball Some pretty noteworthy stats + milestones that made me do a double take
- Latest: Zack Carpenter
