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Markets still falling like whoa

Llano Estacado

By Llano Estacado
in Business and Markets

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Eastwood
Eastwood

That's why I'm out. There is no end game, IMO. This has to be fixed outside of the market and I got too nervous about what that entails for retail investors. They will always be last on the list, if o

Rusty Shackelford
Rusty Shackelford
Eastwood
Eastwood

I'm not a financial advisor. This is not financial advise. I don't work in finance. I do not have a degree in finance. Actually, I have a BA and I'm bad at math past Cal I. I won't apologize for the l

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Aqua Buddha

Aqua Buddha 14640

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This Omicron business being blown way out of proportion.  The vaccines/boosters seem to be as effective against it as Delta and the symptomatic cases seem to be less severe.  Sure, it might kill off some people who are still "doing their own research" but nothing is going to be shut down or some such.

This is moving to being endemic to being in a pandemic and we need to learn to live with it.

Edited by Aqua Buddha
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ZB'Tejas

ZB'Tejas 594

Posted
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1 minute ago, 52-80 said:

im getting murdered this week/month.  i'm holding long commodities (oil and gold) which you'd figure would hedge against long equities but nope.  all getting whacked simultaneously.  nasty bloodletting

I had about 30% on the sidelines ready for something like this but put it to work too early. Just getting blasted from the Fall high's.

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Blotto

Blotto 23606

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20 hours ago, elfenix said:

markets having a strong reaction to the no shit news that omicron is here makes me question rational markets theory

Two years ago before any of this Covid shit was on the radar the market was around 3230 (1/1/20). Since then we've had a pandemic that caused the biggest disruption to our GDP in history and yeah we made it back to previous levels, but only because the government flooded the economy with regarded amounts of money. The S&P is currently at 4530 which is a 40% gain in two years which is significantly greater than the historical expectations (8% annually). Current market valuations are all bullshit. Everyone knows it, but as long as the FED continues to inflate the bubble, everyone plays along and piles in. Its nothing new.

I'm assuming this graphic is relatively acccurate  https://www.currentmarketvaluation.com/models/price-earnings.php )

image.thumb.png.72a2a2216b401d5dacfe4b0d39000fef.png

Yeah, yeah.....but its different this time. I remember those same words in 97 when I was just starting out investing and thought I was Gordon Gecko for a year or two. 

18 hours ago, Cheeseweasel said:

BRRRRRRRRRRT > Rational 

The market isnt twitching like a meth whore because of Omicron, its spooked by the FED's recent words on tapering. Omicron might be the straw that breaks the preverbial camel's back, or maybe the Fed reverses course, and the charade continues on for a bit longer. Cheeseweasel nails it. If we keep BRRRRRRRRRRRTing along the market will remain irrational, but right now there is less certainty on the magnitude of BRRRRRRRRRRRT than there has been in a while. My guess is we continue the charade for a bit longer, because kicking the can down the road is our MO. 

 

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Blotto

Blotto 23606

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Posted (edited)
4 minutes ago, Anastasis said:

What is the exit/hedge strategy for a donkey retail investor?

From one donkey to another......fuck if I know. the only difference between me today and me 20+ years ago is I'm expecting to get assraped here shortly. 20 years ago I was convinced markets went up forever. 

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52-80

52-80 19275

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18 minutes ago, Blotto said:

Two years ago before any of this Covid shit was on the radar the market was around 3230 (1/1/20). Since then we've had a pandemic that caused the biggest disruption to our GDP in history and yeah we made it back to previous levels, but only because the government flooded the economy with regarded amounts of money. The S&P is currently at 4530 which is a 40% gain in two years which is significantly greater than the historical expectations (8% annually). Current market valuations are all bullshit. Everyone knows it, but as long as the FED continues to inflate the bubble, everyone plays along and piles in. Its nothing new.

I'm assuming this graphic is relatively acccurate  https://www.currentmarketvaluation.com/models/price-earnings.php )

image.thumb.png.72a2a2216b401d5dacfe4b0d39000fef.png

Yeah, yeah.....but its different this time. I remember those same words in 97 when I was just starting out investing and thought I was Gordon Gecko for a year or two. 

The market isnt twitching like a meth whore because of Omicron, its spooked by the FED's recent words on tapering. Omicron might be the straw that breaks the preverbial camel's back, or maybe the Fed reverses course, and the charade continues on for a bit longer. Cheeseweasel nails it. If we keep BRRRRRRRRRRRTing along the market will remain irrational, but right now there is less certainty on the magnitude of BRRRRRRRRRRRT than there has been in a while. My guess is we continue the charade for a bit longer, because kicking the can down the road is our MO. 

 

 

My question is real rates for long-horizon bonds is something like 2%.  So where is the investible money (of which there is more) gonna go?  I think at the internet bubble it was north of 5%

The whole thing feels like bicycling up a steep hill, where you're gasping and fighting for every foot, and when you look up, there's more hill to go and it never seems to end.

People had been calling for the tops, quoting the Shiller PE, cautioning against the parabolic upward trajectory, for over 18 months.  And every month, something like a Square or Amazon would gap up 10% -- which calls for a correction in following days -- and next month it does it again.

No matter what time horizon someone try to play out their sentiment -- macro, micro, cross sector, relative value, etc -- another time horizon proves it wrong.  Tough fucking game.

 

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Sbbruin

Sbbruin 21904

Posted
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15 minutes ago, Blotto said:

From one donkey to another......fuck if I know. the only difference between me today and me 20+ years ago is I'm expecting to get assraped here shortly. 20 years ago I was convinced markets went up forever. 

My advisor said, yes, expect some correction.  But if you're not looking to cash out soon, the bounce should be relatively quick.  Just hang on and enjoy the ride.

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Posted

I'm very interested in that valuations are high overall, but it's not like everything is going up. Tons of stocks have been absolutely hammered in recent months:

There are still big gains in a number of meme stocks like AMC and GME -- even TSLA -- but the idea of just throw a dart and whatever you hit will go up just isn't the case. So there are definite signs of frothiness in spots, but then it also seems way to easy to just chalk it up to everyone is in a speculative frenzy for everything. 

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21 hours ago, elfenix said:

markets having a strong reaction to the no shit news that omicron is here makes me question rational markets theory

I read r/coronavirus to keep tabs on the latest articles around the variant. The number of articles that hype "4 cases found in Mexico" or "1 case found in Colorado" or "2 cases found in Chicago" are insane. It's like going back to day 1 of this pandemic.

While there is a vacuum of information regarding the variant, it's just one article after another about cases being found. They typically mention "the four people are vaccinated, had mild symptoms, and now are recovered."

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Sbbruin

Sbbruin 21904

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8 minutes ago, FirstTimeCaller said:

While there is a vacuum of information regarding the variant, it's just one article after another about cases being found. They typically mention "the four people are vaccinated, had mild symptoms, and now are recovered."

Yeah, at this point, there is nothing indicated it is any more dangerous than any other variant, just that it has characteristics of being more transmissible.  Variants will keep coming, and we will need regular boosters, but ultimately we need to move on.

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Blotto

Blotto 23606

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Posted

 

1 minute ago, FirstTimeCaller said:

I'm very interested in that valuations are high overall, but it's not like everything is going up. Tons of stocks have been absolutely hammered in recent months:

There are still big gains in a number of meme stocks like AMC and GME -- even TSLA -- but the idea of just throw a dart and whatever you hit will go up just isn't the case. So there are definite signs of frothiness in spots, but then it also seems way to easy to just chalk it up to everyone is in a speculative frenzy for everything. 

Thats one of the issues with even using the SPY or Nasdaq as benchmarks. they are so heavily loaded with a few high performing stocks that they dont really even mean much. But for alot of the stocks on the Nasdaq 100, the CY 2021 returns are still pretty damn good. Taken in context of these same companies growth in stock price over the last 5 years, its way fucking above historical norms.

https://www.slickcharts.com/nasdaq100/performance 

Take NVDA. Even after falling about 15% it has a market cap of $750 billion. 5 years ago that would have made it the most valuable company in the world. Its trading at about 30X times revenue and 90X earnings. Those multiples are insane for a company of its size. Theres plenty of others. Its just seems like a giant confidence game to me, which is great until it isnt. Maybe this will be the one time the market never reverts to norms. 

39 minutes ago, 52-80 said:

People had been calling for the tops, quoting the Shiller PE, cautioning against the parabolic upward trajectory, for over 18 months.  And every month, something like a Square or Amazon would gap up 10% -- which calls for a correction in following days -- and next month it does it again.

No matter what time horizon someone try to play out their sentiment -- macro, micro, cross sector, relative value, etc -- another time horizon proves it wrong.  Tough fucking game.

 

Indeed, I'm not a finance or economics guy, so there's a ton of shit that matters that I probably don't even take into account. All I can say is it feels like....

somethings-fucky-hmm.gif

And with real estate, crypto, and stocks on this never ending tear, I've felt that way for awhile. Yet we keep chugging along as the Fed keeps up their perpetual market machine. 

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Thanks for posting that link to the returns. It's amazing to me that one-third of stocks in the Nasdaq 100 are negative for the year, yet the market as a whole is up sharply. And the weighting of the biggest companies is high, but the valuations for those stocks doesn't seem crazy either.

Google trades at 27 times earnings. It's grown revenue 50% since 2019. Net income has doubled. 

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Blotto

Blotto 23606

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3 minutes ago, ZB'Tejas said:

Damn, my beaten down stocks are just getting beaten down more. I definitely didn't buy any of the good ones in the S&P Index

Quote

5 giant stocks are driving the S&P 500 to records: Goldman Sachs

Rally on despite markets being powered to records by a handful of very large stocks, says David Kostin, Goldman Sachs chief U.S. equity strategist.

Goldman's research shows that five stocks have accounted for 51% of the S&P 500’s return since the end of April. Those five stocks — Microsoft, Google, Apple, Nvidia and Tesla — account for more than one-third of the S&P 500s 26% return this year.

 

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staboner

staboner 4988

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Posted (edited)
On 12/4/2021 at 4:45 AM, Sbbruin said:

Yeah, at this point, there is nothing indicated it is any more dangerous than any other variant, just that it has characteristics of being more transmissible.  Variants will keep coming, and we will need regular boosters, but ultimately we need to move on.

i dunno homeboy. i mean, ich bin no expert (unless the cable needs fixing)

feels like the pandemic induced (further) inflation will have to start some tapering. i just can't see that otherwise. the party in control of the WH will need to see to that for elections (no CR). last time they tried that (2020 I believe) shit went south in one week. just the sniff of it sent motherfuckers into a fit

rock, hard spot, and the medicine that comes with it. unless they try to do something regarded like fix/floors on commodity pricing or some other dumb shit. i wouldn't be shocked in this timeline

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