The Stock Market thread

[Edward64]

Frakking markets. They were solidly in the black pre-market and now this.

3 weeks of depressing losses and now looking to extend into 4th week. Apple, save us with your big show on Wed.

[Edward64]

FWIW.

Hopefully Jerome will surprise at 50 basis pts.

https://www.cnbc.com/2022/09/07/mark...his-month.html

Traders are now seeing a near certainty that the Federal Reserve enacts its third consecutive 0.75 percentage point interest rate increase when it meets later this month.

The probability of a three-quarter point hike moved to 82% on Wednesday morning, according to the CME Group’s FedWatch tracker of fed funds futures bets.

[Edward64]

Originally Posted by Edward64

Apple, save us with your big show on Wed.

Apple saves the day!

(Not really, Apple underperformed the Nasdaq).

My zillow price continues downward.

[Edward64]

Next inflation report on Tue. If it follows the trend, there'll be 3 weeks down and 1 week up. But please Market Gods, show a nice decrease in inflation!

August 2022 CPI data are scheduled to be released on September 13, 2022, at 8:30 A.M. Eastern Time.

[Edward64]

Regular gas prices have fallen to about $3.20 where I am. Also, my zillow home value has fallen about 7% from peak. I've also noticed meat prices (ribeye's) have fallen. So yeah, I think inflation has more downward trajectory than upward.

My guess is the Fed will be worried about the low unemployment and large number of available jobs.

I've read the Fed target is 4%. So, in addition to the 3-4 Fed governors who (recently) have said rate increases will continue, I'm resigned it'll be a .75 in Sept.

https://www.cnn.com/2022/09/11/inves...ion/index.html

Economists are currently forecasting that consumer prices for August will fall slightly from July and that prices were up 8.1% over the past 12 months. Of course, 8.1% is still incredibly high by historical standards but it would be a notable slowdown from the June’s 9.1% year-over-year spike in prices.

“We probably have seen the peak on inflation. Food and energy prices are coming down. There is more room to the downside,” said Joe Kalish, chief global macro strategist with Ned Davis Research.

Investors seem to begrudgingly accept the likelihood that the Fed will raise rates by 75 basis points again in a few weeks…regardless of what the August inflation data indicates.

But traders are hoping that the September rate hike is the last one of such magnitude. Assuming the Fed boosts rates by three-quarters of a point on September 21, that would bring interest rates to a target range of 3% to 3.25%.

[albionmoonlight]

Originally Posted by Edward64

I've read the Fed target is 4%.

4 Percent of what? Americans who still have jobs by the time they are done?

[GrantDawg]

The beatings will continue until morale is improved.

[Edward64]

Originally Posted by albionmoonlight

4 Percent of what? Americans who still have jobs by the time they are done?

Sorry. 4% inflation

Raising the Inflation Target to 4% Is a Bad Idea | The Fiscal Times

As inflation continues to massively surpass the Federal Reserve's 2% target, we are beginning to hear growing calls from some economists to raise the target inflation rate to 4%. Before the House of Representatives Financial Services Committee last month, Fed Chair Jerome Powell was asked several times about the possibility of raising the Fed's 2% target.

This follows a suggestion from Nobel Laureate economist Paul Romer that the Federal Reserve should raise the target to 3% or 4%. This isn’t a new idea. Economists have been making the case for a higher inflation target for the past decade, and now commentators, such as Matthew Yglesias are starting to promote this idea, too.

[Edward64]

Okay, .75 it is boyz.

Will everyone stop buying "wants". And for "needs", buy the store brands.

The consumer price index increased 0.1% in August. Excluding food and energy, the inflation gauge increased 0.6%, both higher than expected.

Costs were driven by increases in food, shelter and medical care services, offsetting a sharp decline in gasoline prices.

[Kodos]

So... Not the best day to be invested in the stock market.

[Edward64]

Unless you were shorting the market

[NobodyHere]

So long retirement.

[Edward64]

Originally Posted by NobodyHere

So long retirement.

I know there is Fat/Lean/Reg FIRE

Lean FIRE idea was always too "fragile", not enough buffer.

It can be done but it means you were really committed to a tight budget or went to Asia or south of the Border where you can retire comfortably on $20-$30K a year.

[cuervo72]

So, inflation. I'm trying to understand this, and why everyone is shocked that things cost 8% more than they did last August.

I mean, if a trip to the grocery store costs $100 in Jul-21, then $100 in Aug-21 (let's say there was no inflation for a while), then at, say, Mar-22 this jumps to $104, then Jul-22 it is $108...if it is still $108 in Aug-22 aren't we going to be at 8% over last August? Why is this a shock? I mean, when do prices ever go down for anything (gas, yes, but generally for consumer goods)? I feel like once producers know they can get a price for something, they're not going to go back.

(I know capitalism says it should, because competition. But uh, lol.)

[Edward64]

Originally Posted by Edward64

Okay, .75 it is boyz.

Will everyone stop buying "wants". And for "needs", buy the store brands.

Nope, scratch the 75 basis pt hike, it may be a 100. I'm all for it if it gets inflation under control (and us resuming to normal markets 2 days forward, 1 day back)

Wall Street Debates the Fed’s Next Rate Move: ‘They Should Do 100’ - Bloomberg

Tuesday’s unexpectedly hot inflation reading virtually assured markets that the Federal Reserve will raise rates by 75 basis points next week. Wall Street then began to weigh the chance that the Fed might make a more dramatic statement.

The odds for a 100 basis point rate hike jumped more than 20% after the consumer price index showed an increase from July. With hopes of a “Fed pivot” firmly dashed, the S&P 500 Index tumbled as much as 3.2%.

Most investment professionals doubted that an unexpectedly high inflation reading would push the central bank off course to raise rates at their September meeting by an amount not seen since 1984.

“The Fed will want to follow what the market expects and the market is really expecting a 75 basis points move -– so that’s what the Fed will do,” said Tom Di Galoma, managing director at Seaport Global.

But on Tuesday, Nomura economists changed their forecast for the Fed’s September meeting from a 75 to 100 basis points, writing that “a more aggressive path of interest rate hikes will be needed to combat increasingly entrenched inflation.”

[Hammer]

Seems a big market over reaction. This is a backward looking measure over the past year. Inflation isn't high now in the U.K. and I presume things are stable over your way now too. I expect .75 and further evidence of Inflation reduction next time round.

[henry296]

Originally Posted by cuervo72

So, inflation. I'm trying to understand this, and why everyone is shocked that things cost 8% more than they did last August.

I mean, if a trip to the grocery store costs $100 in Jul-21, then $100 in Aug-21 (let's say there was no inflation for a while), then at, say, Mar-22 this jumps to $104, then Jul-22 it is $108...if it is still $108 in Aug-22 aren't we going to be at 8% over last August? Why is this a shock? I mean, when do prices ever go down for anything (gas, yes, but generally for consumer goods)? I feel like once producers know they can get a price for something, they're not going to go back.

(I know capitalism says it should, because competition. But uh, lol.)

Essentially, the thought was that if all prices besides gas stayed relatively flat then CPI would have been negative. Instead other areas like housing increased enough to offset the drop in gas prices.

[Edward64]

The cities with highest inflation.

For Atlanta, it can't be gas (see prices at $3.20 for reg unleaded); it's not housing in my area (my zillow home price has dropped about 7% from high); and it's not been unusually hot weather.

Phoenix - 13%
Atlanta - 11.7%
Miami - 10.7%
Houston - 9.5%
Seattle - 9.0%
Chicago - 8.8%
Detroit - 8.6%
US Average - 8.3%
Philadelphia - 8.1%
Los Angeles - 7.6%
New York - 6.6%

Two U.S. inflation rates: Bad and worse

[QuikSand]

Originally Posted by Edward64

For Atlanta ... it's not housing in my area (my zillow home price has dropped about 7% from high)

that might not be the slam dunk argument you think it is

[QuikSand]

Originally Posted by Edward64

Unless you were shorting the market

[Edward64]

Originally Posted by 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.

I see the new neighbors have finally moved in (they finished the basement). Pretty sure they've "lost" money since they bought at the high.

Wife and I need to bring them some cookies & introduce ourselves.

[NobodyHere]

Here by popular demand!

[Edward64]

Originally Posted by Edward64

Nope, scratch the 75 basis pt hike, it may be a 100. I'm all for it if it gets inflation under control (and us resuming to normal markets 2 days forward, 1 day back)

Wed is the day boyz. Let's hope the bad news is baked in and there is only room for an upward surprise.

Honestly, let's just get this over with. Put me out of my misery

[albionmoonlight]

More of a Main Street than Wall Street view here, but I would assume that most downtown businesses have decided on what level of in-person/hybrid/WFH they are going to do and have implemented those plans.

And based on what I see in Downtown Raleigh, it isn't enough. Pre-pandemic, things were fine. Now, there are a fair amount of empty shops where restaurants used to be. And my parking lot that used to be full is now 1/2 full. And there are more homeless people sleeping in church doors, etc.

I have no idea how representative Raleigh is. And I have no idea how much of the economic activity that moved from downtowns is now occurring in suburbs, etc.

But from just a look-out-the-window point of view, things are still off, and I don't see them coming back anytime soon.

[GrantDawg]

Originally Posted by albionmoonlight

More of a Main Street than Wall Street view here, but I would assume that most downtown businesses have decided on what level of in-person/hybrid/WFH they are going to do and have implemented those plans.

And based on what I see in Downtown Raleigh, it isn't enough. Pre-pandemic, things were fine. Now, there are a fair amount of empty shops where restaurants used to be. And my parking lot that used to be full is now 1/2 full. And there are more homeless people sleeping in church doors, etc.

I have no idea how representative Raleigh is. And I have no idea how much of the economic activity that moved from downtowns is now occurring in suburbs, etc.

But from just a look-out-the-window point of view, things are still off, and I don't see them coming back anytime soon.

I would imagine that businesses based in downtown areas (where the cost of the campus is very high) are more likely to have embraced the work-at-home arrangement than others. I'm in a more suburban area, and I only know of one customer service office that converted to work at home. Of course, the fact almost everyone is understaffed probably makes a difference as well.

[Edward64]

Fed prediction is to keep raising rates from 3.1% to 4.26% from Oct-Mar.

[url="https://www.cnbc.com/2022/09/20/the-fed-is-now-expected-to-keep-raising-rates-then-hold-them-there-cnbc-survey-shows.html"]

The September CNBC Fed Survey shows the average respondent believes the Fed will hike 0.75 percentage point, or 75 basis points, at Wednesday’s meeting, bringing the federal funds rate to 3.1%. The central bank is forecast to keep hiking until the rate peaks in March 2023 at 4.26%.

The new peak rate forecast represents a nearly 40 basis-point increase from the July survey.

And predicting that inflation will be beat next year.

Respondents forecast the consumer price index will end the year at a 6.8% year-over-year rate, down from the current level of 8.3%, and fall further to 3.6% in 2023.

[Edward64]

Some folks on Reddit board pointed out Russia stock market is collapsing today because of hints that Russia will raise higher taxes etc. to support war effort.

I looked at below page and sure enough, Russian stocks (right now) ranges from -2% to -9% with an est. average of -5-6% hit. Sure it's bad but it's not that bad when compared to some hits the US market has taken.

The Russian stock market & economy has been surprisingly resilient. I'm thinking it's probably when Russia loses the war that it'll all come crashing down. I feel bad for the normal Russian investors.

403 Forbidden

[cuervo72]

I keep wondering when our (lone remaining) Pizza Hut is going to reopen their dining area. Not that I'm thinking of dining in, but just curious if they ever intend to.

[Edward64]

Originally Posted by Edward64

Let's hope the bad news is baked in and there is only room for an upward surprise.

Markets went down and then came back up. Unless next CPI shows inflation is ticking down nicely, go for another .75. Get the hurt done this year and we'll start fresh in 2023.

The median forecast also showed that Fed officials expect to hike rates to 4.4% by the end of 2022. With only two policy meetings left in the calendar year, chances are the central bank could conduct another 75-basis-point rate hike before the year-end.

[albionmoonlight]

They've done a good job of setting expectations.

[Edward64]

Yeah, it seems that most Fed Governors have been interviewed/quoted as saying it's going to keep going up until inflation is licked.

Well crap, the market is back down now.

I believe it's been (down-up-down-up-down) so far today.

[NobodyHere]

And now the S&P is down 66

[cuervo72]

What exactly is it that the Fed would like us to stop buying? And who is it they would like to stop buying it?

[Hammer]

Originally Posted by cuervo72

What exactly is it that the Fed would like us to stop buying? And who is it they would like to stop buying it?

Everything and anything. Reduced demand is what will bring inflation down. A hawkish tone yesterday, but I see that as part of the game. Spread fear to encourage people to keep hold of their money.

I expect it to retest the June lows, but close enough now for me. I will DCA in to a Nasdaq index tracker starting today for 6 weeks or so.

[Ksyrup]

I know the Dow is dropping today, but what specifically is causing it in relation to this dude's tweet?

It feels like today might turn out to be a momentous day in economic/financial history in ways that aren’t known to the vast majority of people at the time. A wee bit August 9, 2007-ish.

— Neil Irwin (@Neil_Irwin) September 23, 2022

[NobodyHere]

Sigh

[Solecismic]

Just checking in to make sure everyone with any savings is accounted for. What a ride. A couple of weeks from the quarterly mailing, which is the only time I dare even look at the bottom line.

Pro Tip: Prepare for opening the envelope with two stiff drinks, taken one hour apart.

[Edward64]

Originally Posted by Solecismic

Just checking in to make sure everyone with any savings is accounted for. What a ride. A couple of weeks from the quarterly mailing, which is the only time I dare even look at the bottom line.

Pro Tip: Prepare for opening the envelope with two stiff drinks, taken one hour apart.

What a lousy year. I'm not even going to look, nothing I can do. Will wait until it's nicely trending up.

[cuervo72]

*checks watch*

Yeah, still 20+ years to go until retirement.

[Edward64]

Not quite there yet but you get the idea.


https://i.gifer.com/9O7k.mp4

[sterlingice]

Originally Posted by cuervo72

*checks watch*

Yeah, still 20+ years to go until retirement.

This. It doesn't mean losing a big chunk in a day doesn't suck. But the daily "oh noes" when the market moves 3% is just silly. Then again, it's usually from the section of the audience that was bragging about making 25% when the market was going up... 25%. So I guess that tracks.

SI

[Edward64]

Nice bump this morning. But all gone now. The market is schizo right now. Hopefully, we are near the "acceptance" phase now that all 3 indexes are in bear territory.

I saw unleaded gas for $2.90 (and Costco hotdog meal is still at $1.50). Good news on that front. My zillow house price continues to drop.

[NobodyHere]

Originally Posted by Edward64

Nice bump this morning. But all gone now. The market is schizo right now. Hopefully, we are near the "acceptance" phase now that all 3 indexes are in bear territory.

I saw unleaded gas for $2.90 (and Costco hotdog meal is still at $1.50). Good news on that front. My zillow house price continues to drop.

[Edward64]

Porsche is doing an IPO tomorrow. WTF? It's at the bottom of the Bear market with no real sign of sustained stable/upward trend yet. Is this wise?

[Edward64]

[sovereignstar v2]

Do people believe they are able to time the ups and downs? Why liquidate at this moment?

[Edward64]

Originally Posted by sovereignstar v2

Do people believe they are able to time the ups and downs? Why liquidate at this moment?

My guess is there are a lot of younger investors and older fixed income investors that are tired of getting beat down.

I've read it and I've proven to myself that I can't time the market. I suspect there are a bunch that still think they can.

[albionmoonlight]

Originally Posted by Edward64

I've read it and I've proven to myself that I can't time the market. I suspect there are a bunch that still think they can.

Based on my experience sports gambling, I also understand that I cannot beat the stock market.

The difference is that when I outsmart myself in sports gambling, I lose some beer money. If I were to try to time my investments, I'd lose my house.

[Flasch186]

I think we're in for a hefty recession and I don't think its been remotely priced in. That being said I have tended to be a negative nelly all the way up although profited somewhat (not like I could have if I would have gambled more).

[dubb93]

Originally Posted by Edward64

My zillow house price continues to drop.

As long as my assessment falls along with it, I'm game. I'm not moving anytime in the next 20 years bare minimum(you know unless the bottom completely falls out and I end up homeless or something crazy,) but my property taxes have tripled in the last 5 years.