The Stock Market thread

[Ksyrup]

Yeah I brought this up to my agent a couple years ago when we added a covered deck and he said there's an allowance for X percent above current value so I don't need to worry about it.

[NobodyHere]

Originally Posted by NobodyHere

Well so far so good for the S&P today!

Ditto, fingers crossed that I didn't just jinx it.

[Edward64]

Originally Posted by NobodyHere

Ditto, fingers crossed that I didn't just jinx it.

Nice day & week. You are my official lucky charm.

What are you predicting for next week?

[NobodyHere]

Whenever someone asks me for my prediction I'm obligated to post this video:



But in all honesty I have no idea. It seems like half the analysts are bulls and the other half are bears. Personally the only thing I will say is that I don't think there will be any strong rise in the SP500 until gas prices get under control.

[Edward64]

1-2 weeks ago there was news about odds of going into a recession next year and I was thinking the odds are that we will go into a recession this year (e.g. 2 consecutive quarters of lower GDP than previous quarter).

Still may not happen but I don't see much that changed/improved from 1Q to 2Q so fair chance the GDP shrunk again. So a nice recession leading into mid-terms.

https://www.cnn.com/2022/06/29/econo...nal/index.html

The US economy shrank at a slightly faster rate than previously estimated during the first quarter, the Bureau of Economic Analysis said Wednesday.

With one quarter of negative economic growth in the books, the data adds to fears that a recession may be looming.

Real gross domestic product declined at an annualized rate of 1.6% from January to March, according to the BEA's third and final revisions for the quarter.

I am glad that my son got his job last Nov and that my daughter has 2 more years. It'll prob suck for 2022 graduates like it did in 2020.

[Galaril]

Originally Posted by Edward64

1-2 weeks ago there was news about odds of going into a recession next year and I was thinking the odds are that we will go into a recession this year (e.g. 2 consecutive quarters of lower GDP than previous quarter).

Still may not happen but I don't see much that changed/improved from 1Q to 2Q so fair chance the GDP shrunk again. So a nice recession leading into mid-terms.

The US economy shrank 1.6% in the first quarter, adding to recession fears | CNN Business


I am glad that my son got his job last Nov and that my daughter has 2 more years. It'll prob suck for 2022 graduates like it did in 2020.

Recession won’t hit until 2023 I expect. Likely 2023 grads will be taking it in the hit.

[Edward64]

FWIW Boyz, we just lived thru some market history they'll be writing in investing books. I'm hodling (not that I have much choice).

A multitude of factors conspired to generate the stock market’s worst first-half since 1970, all centering on inflation.

Besides the damage to the big stock market averages, there has been carnage everywhere.

Some hope lies ahead: When the S&P 500 plunged 21% in the first half of 1970, it promptly reversed those losses to gain 26.5% in the second half.

[Edward64]

Originally Posted by Galaril

Recession won’t hit until 2023 I expect. Likely 2023 grads will be taking it in the hit.

I'm still thinking this year.

The Atlanta Fed’s GDPNow gauge sees the second-quarter running at negative 2.1%.

Coupled with the first-quarter’s decline of 1.6%, that would fit the technical definition of recession.

[QuikSand]

We may today be in the throes of a techincal recession, and consumer sentiment may indeed be at rock bottom levels... fair enough. But it's not like all the signs are perfectly clear.

Employers can hardly fill jobs right now. They are throwing bonuses left and right, manufacturing incentives to get workers, and the number of people actively seeking work is unbelievably low. That doesn't track with the standard "recession" scenario.

The economy we are in now is one of a kind.

[Edward64]

Good news on oil prices. I guess Biden's plea got through

The market seems to be stiffening up over the past couple weeks.

Unlike several weeks ago when it was all negative, there's some gains now and today, started off over 1%+ in the red but Nasdaq has fought back to end in up significantly in the black 30 min before market closes. S&P also fought back from a loss and is essentially break even right now.

For the first time in nearly two months, crude oil prices have fallen below $100 a barrel, reflecting investors' growing concerns about a US recession that could crimp demand for oil.

The price of West Texas Intermediate crude tumbled by almost 10% Tuesday, falling below $98 per barrel. Brent crude oil was down by more than 10%, to below $102 per barrel.

It's the first time that WTI has been below $100 since May 11. That was also the last time Brent, which typically trades a bit higher, was below $102 a barrel.

Meanwhile, on recession & inflation watch ...

https://www.cnbc.com/2022/07/05/us-u...s-nomura-.html

“The U.S will fall into recession — so negative quarter-on-quarter GDP growth starting in Q4 this year. It is going to be a shallow recession but a long one. We have it lasting for five quarters in a row,” Subbaraman said.
:
“The Fed will be tightening into this recession and that’s because we see inflation as being sticky — it’s going to stay high. It’s going to be hard to get down,” Subbaraman noted.
:
“It’s hard to say this nicely... getting that pain up front and getting inflation down is better for the world economy and society than actually letting inflation get out of control as we learnt in the 1970s.”

[GrantDawg]

5 quarters? Wow. Meanwhile, construction on manufacturing plants are up by 116%. Manufacturers are moving jobs back to the US from China at a record pace. Bloomberg - Are you a robot?

[QuikSand]

Multiple quarters of slow recession seems in play to me.

i think of this like a discontinuity. Typically the economy is just "how was it just before, and is the arrow up or down from there?" Here, we're awakening from a weird fever dream of the last two years, and have no idea what the underlying economic conditions really are. Are all these restaurants propped up with grant funds just going to be fine? Is the demand spurred by people not needing to pay rent going to disappear gracefully? Are the market changes that altered people's attitudes about most "entry level jobs" transient or permanent? I have my guesses, but that's all they are here.

Q2-3-4 of 2022 and the near beyond are going to build off a platform that we can't even see or measure right now.

[QuikSand]

JPMORGAN: “While some may argue the US is already in recession .. this is inconceivable for a labor market that has generated close to 500k average monthly gains for the past six months .. However, .. with inflation at 40-year highs .. the risk of a break in behavior is 40% ..” pic.twitter.com/CSHK6NOQOn

— Carl Quintanilla (@carlquintanilla) July 6, 2022

[Edward64]

Originally Posted by GrantDawg

5 quarters? Wow. Meanwhile, construction on manufacturing plants are up by 116%. Manufacturers are moving jobs back to the US from China at a record pace. Bloomberg - Are you a robot?

Article doesn't get too much into details but I'm of the opinion keep less strategic stuff off/near shore with our friends or wanna-be-friends (e.g. Nike shoes) and spread it around. For the strategic stuff, keep it with allies/friends (e.g. vaccines).

But yeah, glad to see we are moving out of China. One positive that Trump did by forcing the issue.

[Edward64]

Originally Posted by Edward64

Unlike several weeks ago when it was all negative, there's some gains now and today, started off over 1%+ in the red but Nasdaq has fought back to end in up significantly in the black 30 min before market closes. S&P also fought back from a loss and is essentially break even right now.

Oh yeah baby, same pattern as yesterday. Started off solidly in the red and fought back to solidly in the black!

I'm officially calling it, we've hit bottom and there is no where else to go but up

[QuikSand]

i got to make the "one-armed economist" joke today, when asked about the forecast for the economy ahead... fun times

it goes something like: what you really want is the one-armed economist, otherwise he's just going to answer your question by saying "but, on the other hand..."

[Edward64]

Checked Zillow. Interestingly, our house price dropped from a month (?) ago. Possibly beginning of the housing correction.

Not a surprise, it was predicted, but I didn't want it to happen.

[BYU 14]

Ours still went up, but only 1.2%, to just under 500K, so I would say we have at least peaked

[albionmoonlight]

Originally Posted by Edward64

Checked Zillow. Interestingly, our house price dropped from a month (?) ago. Possibly beginning of the housing correction.

Not a surprise, it was predicted, but I didn't want it to happen.

I just checked. Our estimate hasn't gone down. But I note that a house for sale in our neighborhood is asking for about $30,000 under the zillow estimates of the similar houses around it.

On the assumption that that price point is set by a rational real estate agent, I'd say that the zillow numbers are significantly inflated and haven't caught up (or down?) to the market.

(Which is what was always going to happen once mortgage rates went up from 3%)

[sterlingice]

Just looking at a house for sale in our neighborhood, Zillow had it at $497K. It was listed at $489K at the end of May, price cut to $480K last month, and is now under contract. Also, there's a local Houston realtor database that's publicly accessible and most people use in home searches (HAR.com) and it shows the house as only being available for 9 days there. I can't see the contract price but I'm guessing it's in the ballpark. Of course, as of July 2020 (2 years ago), the house value on Zillow was $308K. And the tax value for last year was $285K(!). Absolute insanity.

Another smaller one in a neighborhood over (we live in a large community that is made up a bunch of smaller neighborhoods with only one entrance into them) is smaller (2600 sqft vs 3000 for the last one). Zillow of $448K, 4 days on HAR and under contract asking for last best offer as of yesterday, sale price of $434K, $316K a year ago, $309K tax assessment. It's like this all over our area and it's just batty.

SI

[GrantDawg]

Ours is up another 6% in the last 30 days. But we are in a very hot market with lots and lots of outside investors.


edit: As an example. There is a house that sold around the corner. It is smaller than ours, and it sold a month ago at $50K over what Zillow says our house is worth now. It now has a for lease sign up.

[Edward64]

Well crap. I'm happy that you guys seem to be doing okay. WTF with my area then?

[sovereignstar v2]

Realtor: "Don't pay any attention to Zillow."

[PilotMan]

Originally Posted by GrantDawg

Ours is up another 6% in the last 30 days. But we are in a very hot market with lots and lots of outside investors.


edit: As an example. There is a house that sold around the corner. It is smaller than ours, and it sold a month ago at $50K over what Zillow says our house is worth now. It now has a for lease sign up.

Institutional investors have been buying up property in our subdivision for the past 8-10 years? One company now owns something like 15% of our entire subdivision (300 houses; not condos, houses). It's enough that they responsible for some of the run up in rental prices and tight markets in this area. There's lots of complaints about renters, but the state might need to step in somewhere or these large investment companies are going to start monopolizing the housing market for profit on a massive, massive scale. It sounds to wild to be true, but there's plenty of rumblings out there about it already. John Oliver had it on his show a couple weeks ago.

[Flasch186]

Pay no attention to Zillow z estimates

They literally canceled their Ibuyer program for relying on their own zestimates and shut it down before the bleeding got so bad


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[GrantDawg]

Flash, I hear you. But when I had a professional appraisal last year it was almost spot on the Zillow appraisal. If anything from sale prices, Zillow appraisals may be low here.

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[Flasch186]

Maybe but we watched over and over for 4-5 months Zillow not only over zestimate homes but then for some reason offer $30-50K OVER that. We'd tell sellers to take it and run. Then Zillow would relist the homes and start slashing prices over the next few months and we knew that they were getting it very very wrong.

[Edward64]

There was a house that sold in our neighborhood a couple months for around the zillow price. It was at the highest price ever in our neighborhood. We see a lot of renovation folks so they have not moved in yet.

Don't know their financial circumstances but am thinking it sucks to be them buying at the peak. But am eager to meet them.

[Edward64]

Nice, 4 days in a row! Hasn't happened since Mar

[NobodyHere]

I may be able to retire in the future!

[Edward64]

Originally Posted by NobodyHere

I may be able to retire in the future!

Nice. What is your lean fire strategy?

[Edward64]

Futures have move deeper into red after below was announced.

I'm guessing this means the odds of a higher Fed rate hike has increased?

Job growth accelerated at a much faster pace than expected in June, indicating that the main pillar of the U.S. economy remains strong despite pockets of weakness.

Nonfarm payrolls increased 372,000 in the month, better than the 250,000 Dow Jones estimate and continuing what has been a strong year for job growth, according to data Friday from the Bureau of Labor Statistics.

The unemployment rate was 3.6%, unchanged from May and in line with estimates.

[Edward64]

And just like that we are back solidly in the black. We're back boyz

(okay, appreciate you letting me keep my fantasy going)

[NobodyHere]

Originally Posted by Edward64

Nice. What is your lean fire strategy?

Rum, video games, and kayaking.

[Edward64]

I think you may be underthinking this a little ...

[NobodyHere]

Originally Posted by Edward64

I think you may be underthinking this a little ...

For a more serious take my strategy is to :
1: Put a large chunk of my paycheck into index funds.
2: Pray to the stock market Gods.
3: Wait until investments hit my target number (which is 20-25 times the income I'll want to have).
4. Have the option to retire.


As of this past January I was planning to hit my target number sometime in the middle of 2024. I haven't recalculated because the new number would just depress me.

[GrantDawg]

Musk just sent the official letter terminating the deal with Twitter. What a shock/s

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[RainMaker]

He was never going to actually do it but will be interesting to see the legal fallout now.

[Atocep]

Originally Posted by GrantDawg

Musk just sent the official letter terminating the deal with Twotter. What a shock/s

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Announce bid to buy twitter, Get media publicity, start publicly questioning the accurate of twitter's metrics, tank twitter stock, get the right to rally around you, bail on the deal.


I doubt he seriously wanted to buy twitter. He wanted the attention and wanted to damage twitter.

[RainMaker]

I don't think he intended to hurt them or anything. He made a dumb offer for attention, Twitter called his bluff, and now he's spent the last couple months furiously trying to get out of the deal he signed.

[albionmoonlight]

For those that want a sense of the actual legal ins and outs of Musk v. Twitter, Raffi Melkonian (@RMFifthCircuit) on Twitter will be a very good follow over the next few months.

[Hammer]

I don't see how advertisers can know what they are getting with Twitter. Seems to me the whole platform is a mess. Looks to me the extent of the mess was uncovered, or rather not. Elon couldn't get a handle on the true state of affairs. Don't blame him for bailing.

[Edward64]

Yay on a strong dollar (and not just in Europe). Vacation anyone?

http://www.cnn.com/travel/article/pa...uro/index.html

The euro is plummeting. For American tourists, that means European vacations are more affordable in dollars than they've been in two decades. So while airfare and other travel costs are rising, the strong dollar might help offset those increases for lucky Europe-bound Americans.

At the time of writing, the euro and dollar are almost at parity. The UK pound is also weak: It's exchanging at $1.20.

[Arles]

Originally Posted by GrantDawg

Musk just sent the official letter terminating the deal with Twitter. What a shock/s

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It worked out perfect for him. He had a bunch of twitter stock. So, he sold a ton of Tesla stock before the bottom fell out to get "cash for the deal" and not get flagged. His talks cause Twitter stock to jump up (so he can sell some for profit). Then, he pulls out of the deal and can now use his cash to buy a bunch of cheaper Tesla stock.

No one has manipulated the crypto and stock market more in the last year than Musk. He's sitting pretty while a ton of average people are holding big bags of Dogecoin, Tesla stock and now Twitter stock (which will probably drop to $20-25 on Monday).

[albionmoonlight]

Originally Posted by Arles

It worked out perfect for him. He had a bunch of twitter stock. So, he sold a ton of Tesla stock before the bottom fell out to get "cash for the deal" and not get flagged. His talks cause Twitter stock to jump up (so he can sell some for profit). Then, he pulls out of the deal and can now use his cash to buy a bunch of cheaper Tesla stock.

No one has manipulated the crypto and stock market more in the last year than Musk. He's sitting pretty while a ton of average people are holding big bags of Dogecoin, Tesla stock and now Twitter stock (which will probably drop to $20-25 on Monday).

And the buzz I hear from folks who understand the legal side of all this is that he probably ends up settling with Twitter by paying somewhere between 1 and 2 billion in damages.

Which, as you note, is way less money than he made by manipulating asset prices before buying and selling them.

[albionmoonlight]

dola: AND he accomplished his main goal which was to get in front of bad publicity that he knew was coming by being able to say "'They' are going to try to take me out because I am so dangerous to 'them' now."

[bob]

Why oh why won't ADP allow me to set a specific dollar amount per paycheck towards my 401k rather than only setting it by percent....

[Solecismic]

Today (for those of us who close our eyes and hope for the rest of the quarter) was the unveiling of the quarterly reports from our retirement funds. Rather staggering seeing the drop, knowing that inflation is taking a second enormous bite from the funds.

[Edward64]

Originally Posted by Solecismic

Today (for those of us who close our eyes and hope for the rest of the quarter) was the unveiling of the quarterly reports from our retirement funds. Rather staggering seeing the drop, knowing that inflation is taking a second enormous bite from the funds.

Not looking. Nope.

[albionmoonlight]

Originally Posted by Solecismic

Today (for those of us who close our eyes and hope for the rest of the quarter) was the unveiling of the quarterly reports from our retirement funds. Rather staggering seeing the drop, knowing that inflation is taking a second enormous bite from the funds.

Dollar cost averaging. Just keep putting the same amount/percentage away every week.

And the good news (which we don't hear about because the media is addicted to bad news) is that all the signs are pointing toward inflation having gotten under control in the medium/long term.