Markets still falling like whoa

[Bozo_Casanova 26688]

58 minutes ago, Judge Roybeanbag said:

I simply disagree with this mindset.  Working for shelter and sustenance is slavery, basically.  

But even if you didn't disagree with the mindset, it's also not good for the function of the free market to wit,

 

On 7/31/2023 at 4:43 PM, Sam Lin said:

You have not misread my response, I simply disagree that every 40hr job should pay enough for livable space and some sort of retirement. A bare-bones job should pay enough to feed you and keep a roof over your head that same day. That's all.

But here's the thing - as a civilization, we decided, back in the 1930s, to have a social safety net and provide livable space, food and in the 1960s, medical care to elderly people and the very poor.

When adults (not talking about kids in summer jobs) can work full time jobs in support of an enterprise but do not make enough to afford housing and provide for themselves generally, we are subsidizing those employers. That's expensive for us and bad for the free market because price discovery is its essential function. 

This is a relatively new problem. It is only gradually since the mid 80s and but really accelerating since the horrible 2001 and 2003 tax stimulus bills* that majority of people who work in retail and food service do not sit squarely in the middle class. Or rather, they still do, but the middle class has collapsed out of the American standard of living as we have captured most of what they used to take home and handed it up the chain - to their employers and senior management with the support of changes to the tax code.

And it's relevant to this thread, because that value capture, along with the decades of low rates devastating consumer savings, has not only driven the valuations that are the subject matter here but also created a time bomb that the taxpayers will wind up having to defuse - if we can - or it will destroy much of the value that has been created in the last 30 years or so.

So we can either walk back the entire social safety net and rethink what it means to be an American, or return a larger share of productivity gains to workers, or continue to dump future tax dollars into private asset valuations.

[Storm the Field 5306]

On 7/14/2023 at 9:24 AM, Storm the Field said:

Pictured: BofA, JPM, and Morgan Stanley CIO's out there every morning keeping up their imminent recession calls, trying to conjure up a market correction.

 

 

 

BofA throws in the towel.

 

[Cheeseweasel 26438]

I think there's more to it than that, Bozo.

Three key changes since the 50's: 

• Women in the workforce increased the supply of workers.
• We've shifted our manufacturing to other countries and essential become a service economy. 
• Increased immigration of low wage, unskilled workers

In my opinion, those three things have had a major impact on the wage gap.

[52-80 19282]

If you want free money, short the front month VIX futures. Its at 17.00 right now. 

Will be lower in 2 weeks, if not 1…

And please remember to Like and Subscribe. 

[Captainant 27989]

13 minutes ago, Cheeseweasel said:

I think there's more to it than that, Bozo.

Three key changes since the 50's: 

• Women in the workforce increased the supply of workers.
• We've shifted our manufacturing to other countries and essential become a service economy. 
• Increased immigration of low wage, unskilled workers

In my opinion, those three things have had a major impact on the wage gap.

Lol, so it's women and immigrants fault - not the wildly diverging profitability and employee pay basis since Reaganomics? Employee wages have stagnated, especially relative to employee productivity. Wages have stagnated because shareholders demand constant and unrelenting quarterly growth - and worker wages are just another cost to be cut if you ask an MBA who's going to be at a new job in 2 years after their golden handcuffs mature

[Cheeseweasel 26438]

Do you contribute anything to this thread other than your Twitter takes?

Let the adults talk, please.

[Captainant 27989]

Lol where is this narrative of social media sourcing all my opinions? No you dense and regressive motherfucker, I am capable of reading information and forming my own thoughts. 

You must have me confused with one of your own peers sourcing shit from tiktok comments

[G650 14303]

30 minutes ago, Storm the Field said:

BofA throws in the towel.

Yeah I've watched this in real time. My guy has gone from definite recession mid year, to maybe 4th quarter, to eh....

[Bozo_Casanova 26688]

31 minutes ago, Cheeseweasel said:

I think there's more to it than that, Bozo.

Three key changes since the 50's: 

• Women in the workforce increased the supply of workers.
• We've shifted our manufacturing to other countries and essential become a service economy. 
• Increased immigration of low wage, unskilled workers

In my opinion, those three things have had a major impact on the wage gap.

I’ve written extensively about the first two bullets and basically agree*, but I would argue the third a bit because it’s really more an issue that tightening the border post 9/11 ended circularity and led to more immigrants staying here and having kids rather than going home seasonally. 
 

That said- the two contributing factors to the first bullet (which I agree is a huge deal) were the wide legalization of the no fault divorce in the early 70’s (a good thing) and changes to the way tax code that increased incentives to widen income inequality between workers and senior management. And union busting was a major contributor to offshoring manufacturing too, that played as much a role as NAFTA.

[Cheeseweasel 26438]

7 minutes ago, Bozo_Casanova said:

That said- the two contributing factors to the first bullet (which I agree is a huge deal) were the wide legalization of the no fault divorce in the early 70’s (a good thing) and changes to the way tax code that increased incentives to widen income inequality between workers and senior management. And union busting was a major contributor to offshoring manufacturing too, that played as much a role as NAFTA.

Good points. I wasn't implying that any of those points were "good or bad" but just they were/are major shifts from the 50's. Certainly tax policy has contributed to the wealth gap. More importantly the pressure (mostly self inflicted) on corporations to think quarter to quarter rather than long term and the subsequent rewards to leadership for increasing stock prices.

I've always been curious about if those in power knew how NAFTA would play out.

[bluto 4947]

Anybody care to explain todays cliff dive?

[Wally Fairway 5607]

Looks to me like we need another break-away thread (like the stonk & penny stock thread - where did that go anyway), as this has become the economics and social effects of tax policy thread, nttawwt; and I just wanted to come say that  someone (FItch rating svc.) finally had the guts to say the King is wearing no clothes. With interest rates going higher & higher the interest portion of Federal spending will triple/quadruple or even go higher than that, over the next few years.
With JPow focused on inflation and employement, it looks like he and his buddies could be pushing the US spending higher and higher as they we are forced to borrow more and more to make debt service payments. 
As Forrest Gump said, I'm not a smart man but this looks to me like we could be in for a long-time getting fucked in the wallet. 

[Bozo_Casanova 26688]

5 minutes ago, bluto said:

Anybody care to explain todays cliff dive?

Downgrade of US debt by Fitch, the predictable result of near default. 
 

BTC up, however. Don’t shoot the messenger.

Edited August 2, 2023 by Bozo_Casanova

[Cheeseweasel 26438]

6 minutes ago, bluto said:

Anybody care to explain todays cliff dive?

I'm sure it's Reagan's fault.

[Guest]

1 hour ago, Bozo_Casanova said:

Downgrade of US debt by Fitch, the predictable result of near default. 
 

BTC up, however. Don’t shoot the messenger.

Plus, just a roaring rally over the past few months. 

[Cheeseweasel 26438]

45 minutes ago, FirstTimeCaller said:

Plus, just a roaring rally over the past few months. 

"Profit taking" is always a good reason.

[Wally Fairway 5607]

2 hours ago, Cheeseweasel said:

I'm sure it's Reagan's fault.

c'mon Man - more like, thanks Obama

[babysdaddy 2730]

2 hours ago, bluto said:

Anybody care to explain todays cliff dive?

lower credit rating= higher expected long term rates= higher discount for cashflows in the future= negative impact to equities.  Last time we had this we lost 25% in the Nasdaq and 17% in the S&P 500 in a week.  But this rating downgrade is a fucking joke.

[Hefeweizen 5361]

I think Fitch explained their reasoning pretty well.  Fiscal deterioration, check, down to the wire clown shows on debt ceiling, check, 20 years of deterioration in governance.

 

It points to a bleak trend for the US as ultimately it means money is more expensive to borrow as risk is higher.

 

I can’t believe the first  cut was 12 years ago.  Time flies when you’re having fun.

[Incredulity 11717]

28 minutes ago, Hefeweizen said:

I can’t believe the first  cut was 12 years ago.

also that it was in early August in 2011.

That can't be a coincidence, right?

[babysdaddy 2730]

3 hours ago, Hefeweizen said:

I think Fitch explained their reasoning pretty well.  Fiscal deterioration, check, down to the wire clown shows on debt ceiling, check, 20 years of deterioration in governance.

 

It points to a bleak trend for the US as ultimately it means money is more expensive to borrow as risk is higher.

 

I can’t believe the first  cut was 12 years ago.  Time flies when you’re having fun.

 

 

[Incredulity 11717]

Holy shit.  I may agree with Krugman.

 

 

I am not clicking through his Twatter to confirm though.

[Hefeweizen 5361]

Lol Krugman.

 

Edit:  I think there’s another monkey shit flinging debt ceiling slap fight coming so maybe they are getting ahead of it.

Edited August 2, 2023 by Hefeweizen

[Cheeseweasel 26438]

13 hours ago, Hefeweizen said:

Lol Krugman.

[52-80 19282]

Triple A from Moodys.  Triple A from Morningstar.  AA+ from S&P.  AA+ from Fitch. 

This is the equivalent of dropping from 850 to 840 on a FICO score.

[Sam Lin 3566]

Having a hard time seeing why the absolute credit rating matters at all. Globally it's all relative. As long as the US has more projected strength and stability than everyone else, even if it is a B and everyone else is a C, nothing will actually change in distribution of "money" worldwide.

[Bozo_Casanova 26688]

Yeah what’s a few more bips on $1.6T, anyway? And besides, it’s not as though  multiple competing settlement networks and reserve currencies are accelerating into broader use.
 

Good take gents. 

[52-80 19282]

5 minutes ago, Bozo_Casanova said:

Yeah what’s a few more bips on $1.6T, anyway?

Because the 10y moved 400 bips in range over the last few years because of a change in whose rating….?

The narration from Fitch is perfectly valid. Except that story (compounding debt; perpetual budgeting standoff) has been the same for decades. 

[Bevo 3000 10]

On 8/2/2023 at 9:50 AM, Storm the Field said:

BofA throws in the towel.

 

Looks like we have a Senator that disagrees. 
 

https://twitter.com/unusual_whales/status/1686783179485491200?s=46&t=uKnL2agxvSx0rJZI2y3iWw

 

 

Poltician’s trading records are typically pretty solid. 
 

[Cheeseweasel 26438]

14 hours ago, Bevo 3000 said:

Poltician’s trading records are typically pretty solid. 

 

[52-80 19282]

On 8/2/2023 at 5:05 PM, 52-80 said:

If you want free money, short the front month VIX futures. Its at 17.00 right now. 

Will be lower in 2 weeks, if not 1…

And please remember to Like and Subscribe. 

at the open you're up $1250 per contract, so yall owe me lunch money

[Parliament 14392]

I send you my tree fiddy. Post your banking information thx.

[Wally Fairway 5607]

1 hour ago, Parliament said:

I send you my tree fiddy. Post your banking information thx.

your mother's maiden name, street you grew up on, and last 4 digits of your SSN

[Cheeseweasel 26438]

13 minutes ago, Wally Fairway said:

your mother's maiden name, street you grew up on, and last 4 digits of your SSN

By the way, what was your first pet's name?

[52-80 19282]

49 minutes ago, Cheeseweasel said:

By the way, what was your first pet's name?

I call my dog the Big Guy

[Incredulity 11717]

48 minutes ago, 52-80 said:

I call my dog the Big Guy

He does very well on 10%

[Storm the Field 5306]

On 8/2/2023 at 9:50 AM, Storm the Field said:

BofA throws in the towel.

 

JPM waves the white flag.

 

[Incredulity 11717]

Meanwhile the market takes a dump

 

wtf happened this afternoon?

[52-80 19282]

Ive been in and out of the VX position all day scalping gains. Current short has a cost basis of 16.71 against spot price of 17.30. See you next week

[Cheeseweasel 26438]

18 minutes ago, Incredulity said:

wtf happened this afternoon?

@Wally Fairway?????????

[Wally Fairway 5607]

On 7/22/2022 at 9:58 AM, Wally Fairway said:

In an effort to be fully transparent the those who try to make some money on the RWIS (reverse wally investment strategy),

I have slowly started to see if my investing can influence one of the best run investment funds in the history of stock market investing. That is right Berkshire Hathaway in now in my crosshairs , I've started buying LEAP calls on BRK.B, the furthest traded date is currently January 19, 2024, both some $350 strikes (around $10) and a few $400 strikes ($3.50). This is a play on the recession ending by the 3Q 2023 and that my favorite nonagenarians find a good place for most of the estimated $100 billion they have in cash (it was $150 but Uncle Warren liked him some Oxy this year). 
FWIW - I picked the $350 strikes because that is below the 52 week (and all-time) high for BRK, but I'll pick some longer expiry dates once they open.
Right now I have just under 0.4% of my portfolio in the non-stonkiest of investments (which is why I'm posting here not there)

Ride the wave fellow surlyites, you know the drill....sell BRK, buy puts, sell me some of your covered calls.
Is there a 2xRWIS fund?

1+ year update - sold my first 1/9/2024 BRK.B $350 call today for $26+, still have 2 of the $350's, 2 of the $360's and 4 of the $400's. I am up over 100% of the $350 & $360 and with today's action the $400's are up 65% today which gets those to down about 45%.
Overall up about 65%, but need to sell into the BRK.B rally, as the options pricing will start to slow as we get nearer the expiration date. I may let 1 or 2 of the options fill and increase my Uncle Warren holdings, but I have a few months to decide on that (still think that Warren or Charlie dying will become a buying opportunity).

Gotta take some profits while you can (if the reverse Wally scheme worked perfectly then everyone would do it)
Current BRK.B option holdings below

Spoiler

 

Edited August 7, 2023 by Wally Fairway

[Guest]

Lol. Headline to CNN article, linked on Drudge:

"Americans are pulling money out of their 401(k) plans at an alarming rate"
https://www.cnn.com/2023/08/08/economy/401k-hardship-withdrawals/index.html

Oh noez!

The article: "The number of people who made a hardship withdrawal during the second quarter surged from the first three months of the year to 15,950, an increase of 36% from the second quarter of 2022, according to Bank of America’s analysis of clients’ employee benefits programs, which are comprised of more than 4 million plan participants."

"However, overall employee contributions continued to hold steady for the first half of the year, and a greater share of participants upped their contribution rate than decreased it."

[52-80 19282]

1 hour ago, FirstTimeCaller said:

Lol. Headline to CNN article, linked on Drudge:

"Americans are pulling money out of their 401(k) plans at an alarming rate"
https://www.cnn.com/2023/08/08/economy/401k-hardship-withdrawals/index.html

Oh noez!

The article: "The number of people who made a hardship withdrawal during the second quarter surged from the first three months of the year to 15,950, an increase of 36% from the second quarter of 2022, according to Bank of America’s analysis of clients’ employee benefits programs, which are comprised of more than 4 million plan participants."

"However, overall employee contributions continued to hold steady for the first half of the year, and a greater share of participants upped their contribution rate than decreased it."

 

Oh man, 0.29% of 401K participants had to make a hardship withdrawal, which drastically increased 10bps to 0.39% of participants.  Sound the bells.

[Cheeseweasel 26438]

14 hours ago, 52-80 said:

 

Oh man, 0.29% of 401K participants had to make a hardship withdrawal, which drastically increased 10bps to 0.39% of participants.  Sound the bells.

It's CNN. You have to assume their viewers look at the statistics like this:

 

 

[52-80 19282]

46 minutes ago, Cheeseweasel said:

It's CNN. You have to assume their viewers look at the statistics like this:

 

 

+blue hair, scarf, nose ring, che guevara t-shirt

[CooterBrown 18099]

16 hours ago, 52-80 said:

 

Oh man, 0.29% of 401K participants had to make a hardship withdrawal, which drastically increased 10bps to 0.39% of participants.  Sound the bells.

I'm actually pleasantly surprised that that hardships withdrawals are that low. If I had to guess, I would've said around 3-5%. 

 

[52-80 19282]

haters will say it's fake

 

 

[Wally Fairway 5607]

17 hours ago, 52-80 said:

 

Oh man, 0.29% of 401K participants had to make a hardship withdrawal, which drastically increased 10bps to 0.39% of participants.  Sound the bells.

Yeah but is more impactful that saying previously 99.71% of participants did not take a hardship withdrawal but that number decreased to 99.64% did not take a hardship withdrawal; which is a 0.07% decrease in the number of people not taking the withdrawal. 
I mean that isn't going to be a news story anywhere.

[52-80 19282]

VIX 14.67

VX 15.12

UVXY 16.62

all redder than the crimson river

 

[DaysOff 8012]

To the moon. Let's fucking go.