sure watch your portfolio go down because experts told you so. In the meantime put this in your pipe and smoke it.
OT: Stock and Investment Thread
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I like Brat, but he's getting a few things wrong here. The US dollar is still the king until someone comes to take its crown and right now there isn't a real contender so you are seeing a flight to safety (the dollar) for over a year now. We are still the world's tallest midget. Global currency wars are a relative not absolute game.
Countries that borrowed money in US $ are the ones in real trouble as the price to pay back that debt has risen considerably over the last year, in some cases by 30-40%. This is going to cause significant problems for those countries and many will default. Particularly in Europe as they not only have to pay the $ debt back but they need to sell Euros to pay for their self imposed energy crisis. It could get very ugly over there this winter if they don't come to terms with Putin.
There is not as much leverage in hedge funds as their used to be but there is a lot of leverage in the system and much more in the system via leveraged etf's, swaps, etc than there used to be. Any crash in leverage won't be limited to hedge funds. Overall, I also think this is more of a real economy problem than a wall street financialization problem like the previous crashes have been. That also means it will be much harder to fix and the current admin is doing everything it can to make it worse. For these reasons, I think Powell will continue to raise rates as inflation will be difficult to tame.
Look to Europe for the biggest issues IMO. US always reacts quicker in these times, the Europeans try to sweep things under the rug and always react slower.
Countries that borrowed money in US $ are the ones in real trouble as the price to pay back that debt has risen considerably over the last year, in some cases by 30-40%. This is going to cause significant problems for those countries and many will default. Particularly in Europe as they not only have to pay the $ debt back but they need to sell Euros to pay for their self imposed energy crisis. It could get very ugly over there this winter if they don't come to terms with Putin.
There is not as much leverage in hedge funds as their used to be but there is a lot of leverage in the system and much more in the system via leveraged etf's, swaps, etc than there used to be. Any crash in leverage won't be limited to hedge funds. Overall, I also think this is more of a real economy problem than a wall street financialization problem like the previous crashes have been. That also means it will be much harder to fix and the current admin is doing everything it can to make it worse. For these reasons, I think Powell will continue to raise rates as inflation will be difficult to tame.
Look to Europe for the biggest issues IMO. US always reacts quicker in these times, the Europeans try to sweep things under the rug and always react slower.
C'mon this is a good thread. Don't ruin it with political spamming. Everyone knows Biden is a clown but let's try to talk about the markets here without this.
We have to remind certain people who is responsible for what is happening not only in the markets but the country as well.
Bringing politics into this thread discredits anything the poster has to say about investing. Keep the clowns under that Big Top of the CE Board.
Its not politics to assign blame
I think its OK to talk about how policy affects the markets.
Political spamming offers nothing of value to the discussion.
What is the rate of inflation in the other major industrialized countries?
Is there a policy in any specific country we consider a peer country that has resulted in significantly lower inflation?
Is there a policy in any specific country we consider a peer country that has resulted in significantly lower inflation?
Alright pinehurst calm your *** down. Here’s a nice picture of the President with the Late Queen Elizabeth II.
Currently inflation is a global phenomena as all the major central banks have had expansionary monetary policies for more than 20 years. Because of the rising US$ its actually a lot worse in other countries.
The absolute best thing we could do in the US is to get back to producing low cost energy but currently we are doing the opposite so I fear things will get worse before they get better.
Edit: The current runaway spending like the inflation reduction act is also making things much worse. That shouldn't be ignored.
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I noticed France has an inflation rate of 5.8%
Should we follow their economic policies?
Are they producing more low cost energy than the US?
France and Spain are in much better shape energy wise than the rest of Europe. France because they stuck with Nuclear energy and Spain gets a lot of nat has supply from Morocco.
I have been watching European markets for 30 years. I tend to not believe the numbers they are putting out. There is usually a six month lag from reality.
That is fair
What country has economic policies that have kept inflation low?
Out of the countries with significantly lower inflation would it be Switzerland? If so what are the exact policies they have that keep inflation low?
China has done a great job keeping inflation down…by making in China almost everything they need, by having a zero COVID policy and by buying cheap energy from the criminal regime in Russia. State capitalism done properly.
Can't say I know that much about Switzerland but remaining independent of the EU and controlling their own fiscal and monetary policy is clearly working to their benefit right now.
The answer is fiscal responsibility which very few of the western countries have been doing. The US is in the unique position of being the world's reserve currency which allows us to get away with a lot more but that has its limits. If there was another country (or currency) ready to take our place we would be experiencing a lot more pain. I just don't think there is one for the foreseeable future. But if we keep up our irresponsible ways eventually something will change.
You’re an idiot. You moved your money out of the market which is what the article is about. You got crushed in the 2008 crash so you decided to change your strategy. I’m 90% in cash waiting for further decline and was out of the market in the 2008 crash.sure watch your portfolio go down because experts told you so. In the meantime put this in your pipe and smoke it.
Anyone that has a high cash balance is basically timing the market.
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Oh and almost forgot…China’s housing policy is disinflationary. In the US, shelter is by far the biggest inflation driver currently with medical services being another major driver.
Because the dollar is currently "the tallest midget" I've heard its situation described as "failing up."
Russia and China want to dump it and there is the big push for digital currency - including from DC (where they would like dollar flattened as well imo.)
"Margin calls in Europe began earlier and borrowing based on dollars is now a rope around some necks. Europe is like a house of cards"Aside from fanning inflation, the biggest energy crisis in decades is sucking up capital to guarantee trades amid wild price swings. That’s pushing European Union officials to intervene to prevent energy markets from stalling, while governments across the region are stepping in to backstop struggling utilities. Finland has warned of a “Lehman Brothers” moment, with power companies facing sudden cash shortages. "
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So do you think a politician should run on converting the US economic system to the Chinese system?
PPI comes in better:
As may people know, the CPI is garbage and lags on key metrics 6-12 months (like housing). PPI is better, but still doesn't reflect current reality.....probably lags 3-6 months on some items. The Professor (link above) continues to hit the nail on the head.
Bernie isn’t even consistent with the Chinese system…and I’m not really a big Bernie fan. Dark Brandon is a centrist and rational unlike the fringes on the left and right.
The whole world wants the dollar to move lower but nobody will trust the Russians or the Chinese so that's not a real option. The lack of trust in the Chinese is the only thing keeping Japan from a total meltdown.
Agree Europe is a house of cards and they are in total denial. It's the craziest thing I've ever seen. That cartoon character Ursula Van der leyen came out this morning and quadrupled down on their insane policies.
I wonder when the people will rise up. It seems like just a matter of time.
Bottom line is Americans have lost. $1 trillion in their retirement accounts and now the housing market is crashing. Inflation will come down because most will be poorer. The government will take credit for 5%. inflation but the 2 year compounded rate will be 13%
US doesn't want Ukraine to end - they were over there helping to stage the "offensive victory" kabuki just in time for more money to be poured down the hole.
The cost of primary needs that people have (gas, groceries. utilities) are up 24% on annualized basis (and rents are also crushing). People are using credit cards even as rates rise.
There has been 17 consecutive months of real wages decline.
6.1 trillion dollars of net worth drop (bonds and stocks) in one quarter - most in US history
Bonds not doing well when they are expected to - even LQD is down 21% over 2 years
The question was which major economy has done well controlling inflation. The answer is China (and also Japan). You obviously still think China is a nation of peasants.
You're just ignorant to the dynamics behind your assumption which is funny. I'll listen to your reasoning but you're already starting off incorrectly but ill play. Shoot
Are you saying China is reporting fake data?
What country do you credit for policies that have kept inflation in check and what are those specific policies
You didn't read the article. you just listed the inflation rates for 2021 and 2022, and blamed Biden.
Timing the market” is a loose term that means trying to cut your exposure to the market before it falls and raise it before it rises. It covers a variety of strategies, tactics and time frames.
At the other end of the spectrum you have people who are moving slowly and thinking long term. They aren’t ducking in and out over days, weeks, or even months. They may raise or lower their exposure to the stock market from one year to the next, depending on whether they think stocks (and bonds) are overvalued compared with their fundamentals, or undervalued, or in response to economic or political risks.
People doing this may not even think of what they are doing as “timing.” They may actually object to the term, with its disreputable connotations of day trading. But anything involving cutting or raising stock market exposure temporarily, in the hope of profit and in response to market or economic conditions, is a form of timing.
It’s this latter type that GMO is talking about.
Ben Inker, GMO’s co-head of asset allocation, and asset allocation team members James Montier and Martin Tarlie, have just published a paper that is likely to ruffle plenty of feathers. “Investing for Retirement III: Understanding and Dealing With Sequence Risk” argues that retirees can lower their risk of running out of money by including some market timing in their so-called “glide path,” meaning the path by which their portfolio is expected to evolve as they move through retirement.
Right now, the retirement industry’s typical advice is that retirees should pretty much ignore temporary market conditions, and follow a predetermined optimal “glide path” from risk to safety, stocks to bonds, as they age. (There has been a lively debate about what that glide path should look like, but that’s another story.)
But as the GMO trio point out, these strategies and glide paths all rely logically on an unspoken assumption: That stocks and bonds are priced “fairly,” or (in layperson’s terms) “about right.” This is actually the great unspoken assumption underlying a lot of today’s financial advice: The “expected returns” and “risk” (i.e., volatility) of various assets at any given point is simply based on their average returns and volatility from the past 20, or 50, or 100 years
This is where Inker, Montier and Tarlie come in. They argue that retirees can lower their risk of running out of money by “buying low and selling high.” When the stock market is expensive in relation to fundamentals, they argue, retirees should be adjusting their stock exposure downward. And when the stock market is cheap, they argue, retirees should be ramping their stock exposure up.
Such advice tends to run counter to modern conventional wisdom, which generally advises people to pick an asset allocation based on our individual circumstances and risk tolerance, and adjust it only as those change.
Compared to 2008, this is a slow moving train that most people see crashing but afraid to do anything. I have some losses but it would have been 4 times greater without reacting. I sold META about 1-2 years ago but brought it back @ 17 PE and then started reducing exposure when I realized the PE doesn’t matter for META now. The PE is now 12.5 but at some point people will be attracted to Meta again.
RUdead....U R not dead at all! You are thinking clearly with this post.
Yeah, because deep water (almost limitless sq miles available) wind energy isn’t the future
.Yeah, because deep water (almost limitless sq miles available) wind energy isn’t the future
Wind is intermittent, costly. It can't be relied on for baseload energy, only as a supplement.
It also kills a lot of birds, so not environmental friendly.
Except now we can store the energy and birds are just going to have to figure it out. Birds also struggle with windows by the many many millions each year.
Of course there is windmill cancer to worry about.