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OT: Stock and Investment Talk

My long portfolio was down 2% but short portfolio was up 25%. Too bad I was 97% long and 3% short. LOL
You talk a big game on shorting, but I see that you are just a dabbler. Like me with cryptos (75% of my posts, but 0.4% of my portfolio)! HA! HA!
 
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Iā€™ve done plenty of research on Coinbureau so your link isnā€™t particularly helpful. ā€œGuy the crypto guyā€ pushes a pro-crypto agenda. He portrays himself as an expert so all Iā€™m asking for are his credentials. I want to be proven wrong. Otherwise, itā€™s just as likely heā€™s a shill (decent looking British actor is a perfect choice) that works for someone like the Winklevoss twins or an operation in China.
This site may have more info that you want.
 
Would it be safe to say that we just experienced a period of great stock performance in the backdrop of weak economic fundamentals in 2020?

Government engineered share price performance? Yes.

But the bigger picture issue pertains to rates. The fact is not one person on this board has invested during a Treasury bond near market. And such bear markets do occur. When they do, they wreak havoc on equity valuations and can completely negate otherwise strong economic fundamentals.

Look a the last Treasury hear market, which began in roughly 1965 and ended 17 years later in 1981. The Dow started that period at 874. It ended that period at...875. That despite very strong GDP growth; in fact, much stronger growth than which occurred in the subsequent Treasury bull market. Of course, rates collapsed, so share prices turned in their best multi decade performance on record over the subsequent 17 year period.

And where are we today? Very, very low rates. Even after the spike in the 10 year yield over the last few trading sessions. Economic growth has no chance of matching what occurred in the 1965-1981 period. Does that mean that we are looking at 17 years of no share price appreciation? Not likely, as I hope we arenā€™t looking at Treasury yields in the double digits. But a sustained increase i yields, even back to historic norms, would not be good for any of these high flying growth stocks. And it would relate the multiple on businesses that actually earn money today, too.
 
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You talk a big game on shorting, but I see that you are just a dabbler. Like me with cryptos (75% of my posts, but 0.4% of my portfolio)! HA! HA!
Not as fun talking about longs. I donā€™t trade longs, I only invest on the long side. Plus on the short side, I get to actually realize P/L.
 
Not as fun talking about longs. I donā€™t trade longs, I only invest on the long side. Plus on the short side, I get to actually realize P/L.
So we align 97% of time! Why do we argue so much on your 3% and my 0.4%? šŸ˜œ
 
That's because selling GME calls at 800 48 hours before expiration is shooting fish in a barrel, not gambling. But hey, they stuck it to the man.
The second most active options are 800 calls expiring next Friday. People either don't know how options work or just don't like money.
 
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Bull markets have averaged 2.7yrs with a 111% return
Bear markets have averaged 9.5mths for avg return of -35%

All since 1929 so the point is you need to be patient for the long run
 
Government engineered share price performance? Yes.

But the bigger picture issue pertains to rates. The fact is not one person on this board has invested during a Treasury bond near market. And such bear markets do occur. When they do, they wreak havoc on equity valuations and can completely negate otherwise strong economic fundamentals.

Look a the last Treasury hear market, which began in roughly 1965 and ended 17 years later in 1981. The Dow started that period at 874. It ended that period at...875. That despite very strong GDP growth; in fact, much stronger growth than which occurred in the subsequent Treasury bull market. Of course, rates collapsed, so share prices turned in their best multi decade performance on record over the subsequent 17 year period.

And where are we today? Very, very low rates. Even after the spike in the 10 year yield over the last few trading sessions. Economic growth has no chance of matching what occurred in the 1965-1981 period. Does that mean that we are looking at 17 years of no share price appreciation? Not likely, as I hope we arenā€™t looking at Treasury yields in the double digits. But a sustained increase i yields, even back to historic norms, would not be good for any of these high flying growth stocks. And it would relate the multiple on businesses that actually earn money today, too.

Wasn't the 10 year rate in '65 around 5%? I rates reached that level a lot of insurance companies and pension plans would surely reduce their allocation to equities.

But while there are black swans in the pond today, I don't see any with the inflationary inflation spike of the oil embargo. That is unless they ban fracking on existing leases.
 
Bull markets have averaged 2.7yrs with a 111% return
Bear markets have averaged 9.5mths for avg return of -35%

All since 1929 so the point is you need to be patient for the long run

Except from 1929 bear was 2-3x the length of the average. The 1969-1982 was about 2X.
 
Bull markets have averaged 2.7yrs with a 111% return
Bear markets have averaged 9.5mths for avg return of -35%

All since 1929 so the point is you need to be patient for the long run
+1
Be patient and stay the course!
 
You talk a big game on shorting, but I see that you are just a dabbler. Like me with cryptos (75% of my posts, but 0.4% of my portfolio)! HA! HA!
This is me with penny stocks... itā€™s maybe 1-2% of my money but 75% of what I talk about when talking stocks
 
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Wasn't the 10 year rate in '65 around 5%? I rates reached that level a lot of insurance companies and pension plans would surely reduce their allocation to equities.

But while there are black swans in the pond today, I don't see any with the inflationary inflation spike of the oil embargo. That is unless they ban fracking on existing leases.

Thatā€™s a fair point. Energy prices have moved, and given the abundance of oil and gas, likely will continue to trend, lower. However, we donā€™t need Treasuries to move to a 15% yield to meaningfully erode valuations. Simply reverting to historic norms will have a very substantial impact despite healthy economic conditions. And thatā€™s really the point. Normalized rates, which we havenā€™t really seen or permitted since 2006, will be very unpleasant. And such an outcome is not likely to be under the Fedā€™s control.
 
Jan 1996 the S&P was around 600. In 2006 it was around 1200.

Dow was about 5400 and 10,700.

Nasdaq went from 1000 to about 2300.

So over a 10 year period, if you just held through the bubble, it's burst and then it's recovery, you doubled your money.
 
I'll throw another one out there.

If you bought the Nasdaq in 1996, and held through the tech bubble, the financial crisis, and Covid, you are up 13x.

Is this a bubble? To some extent, sure. Where are we in the bubble? No one can say for sure. Should you stay in or get out of the market? Everyone has to make that decision for themselves.
 
I'll throw another one out there.

If you bought the Nasdaq in 1996, and held through the tech bubble, the financial crisis, and Covid, you are up 13x.

Is this a bubble? To some extent, sure. Where are we in the bubble? No one can say for sure. Should you stay in or get out of the market? Everyone has to make that decision for themselves.

well, if bought in 2000, at one of the previous peaks, youā€™re up less than 3x, 21 years later, and it would have taken you fifteen years to get back to even. And, current NASDAQ stock valuations are closer to the valuations in 2000, versus 1996. And yes, I agree 100% that everyone make their investment decision themselves, based on their age and financial position. I also agree that we donā€™t know where we are in the bubble. Greenspan gave his irrational exuberance speech in late 1996, 3+ years before the bubble burst. Now we might be a few years into high valuations, so I donā€™t think the market craziness will go for too much longer, but what the heck do I know?
 
well, if bought in 2000, at one of the previous peaks, youā€™re up less than 3x, 21 years later, and it would have taken you fifteen years to get back to even. And, current NASDAQ stock valuations are closer to the valuations in 2000, versus 1996. And yes, I agree 100% that everyone make their investment decision themselves, based on their age and financial position. I also agree that we donā€™t know where we are in the bubble. Greenspan gave his irrational exuberance speech in late 1996, 3+ years before the bubble burst. Now we might be a few years into high valuations, so I donā€™t think the market craziness will go for too much longer, but what the heck do I know?
Well yeah, if you missed the 5x run in the 4 years leading into the tech bubble, and then bought at the very tippy top, then you didn't do so well.

Assuming you were in on even part of the run up(I could have went out a bit earlier to make the growth even more impressive) you did very well.
 
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I'll throw another one out there.

If you bought the Nasdaq in 1996, and held through the tech bubble, the financial crisis, and Covid, you are up 13x.

Is this a bubble? To some extent, sure. Where are we in the bubble? No one can say for sure. Should you stay in or get out of the market? Everyone has to make that decision for themselves.
+1
Be patient, stick to the plan, don't panic and all will be well. Time is on our side!
 
well, if bought in 2000, at one of the previous peaks, youā€™re up less than 3x, 21 years later, and it would have taken you fifteen years to get back to even. And, current NASDAQ stock valuations are closer to the valuations in 2000, versus 1996. And yes, I agree 100% that everyone make their investment decision themselves, based on their age and financial position. I also agree that we donā€™t know where we are in the bubble. Greenspan gave his irrational exuberance speech in late 1996, 3+ years before the bubble burst. Now we might be a few years into high valuations, so I donā€™t think the market craziness will go for too much longer, but what the heck do I know?
But nobody ever just buys at X or Y. Not a post about dollar cost averaging, just that people accumulate their money over time (i.e., regular paychecks).
 
He and the CB team are definitely experts. Their educational videos are amazing (and over my head on the blockchain tech stuff). Great resource for those into cryptos!

How can you say that the educational videos are amazing, if the information is way beyond your capacity to understand it?
 
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How can you say that the educational videos are amazing, if the information is way beyond your capacity to understand it?
I'm talking about the programming and blockchain details (those videos are just a small subet). Very interesting, but beyond me unless I really dedicate myself to learning it all.
 
But nobody ever just buys at X or Y. Not a post about dollar cost averaging, just that people accumulate their money over time (i.e., regular paychecks).

I was responding to a post where the person picked a very convenient point in time (1996) to show how much the NASDAQ went up. My post was to show balance. Itā€™s not surprising that you didnā€™t respond similarly to that post. In fact, you gave him a ā€œ+1ā€. Keep cheerleading a market where the average P/E ratio for the S&P 500 is WAY above historical averages.
 
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CW with a video to end the week. Great macro discussion. Saving rates have popped up to 25%. Consumers have a lot of firepower now and DC wants to dump another $1.9T on them. Hmm....

GME to the moon? šŸ˜

Also record shorts on bonds this week.

 
Nope. The bears in the thread need to calm down! :)

Mixed day, but good day. Most of my big funds were up. Cryptos today were meh.

I havenā€™t read anyone predict we are headed for a 1929 market crash and prelude to a 1930s style depression. What Iā€™ve pointed out, however, is current prices donā€™t reflect or discount much in the way of risks. To illustrate that point, I compared the current time period to the mid 1960s to show that strong economic performance, while certainly a very important variable, is not the sole determinative driver of equity prices. Ignoring opportunity costs, and how they are likely to evolve, was the message. Then, like now, rates were very low. Then, rates began a multi-decade climb and stocks went exactly nowhere. Had you placed a large amount of money into the market at that time, you would have enjoyed dividends that perhaps were reinvested, but the absolute level of the overall market went exactly nowhere. Did I select that time period deliberately? Absolutely, but more to illustrate how strong economic fundamentals married with a long term Treasury bear market can lead to very underwhelming results. Itā€™s not an environment anyone today has experienced.

Others have selected decade long time period surrounding various advances and subsequent declines to show that, longer term, investors who stayed the course came out with a good result. All true for the periods selected, but Iā€™d point out that none of those periods involve a sustained movement higher in yields. And we donā€™t need a return to late 1970s or early 1980s levels of inflations or rates for a re-rating of multiples to occur.
 
For a certain group of investors, this morning is akin to Christmas Day. Itā€™s the day where Berkshire releases its annual report, along with the ever anticipated letter to shareholders from Warren Buffett. Several notable items, but probably most significant for a Berkshire shareholder is the level of share repurchases. Purchases of individual shares are a zero sum game. With regard to the price where two parties agree to trade, either the buyer or seller will be correct. Itā€™s why many investors have described it as an arrogant act, because youā€™re not aware of what the seller knows that you donā€™t. Well, if youā€™re a current seller of Berkshire, you very well could be selling to Buffett. Yikes.

 
I havenā€™t read anyone predict we are headed for a 1929 market crash and prelude to a 1930s style depression. What Iā€™ve pointed out, however, is current prices donā€™t reflect or discount much in the way of risks. To illustrate that point, I compared the current time period to the mid 1960s to show that strong economic performance, while certainly a very important variable, is not the sole determinative driver of equity prices. Ignoring opportunity costs, and how they are likely to evolve, was the message. Then, like now, rates were very low. Then, rates began a multi-decade climb and stocks went exactly nowhere. Had you placed a large amount of money into the market at that time, you would have enjoyed dividends that perhaps were reinvested, but the absolute level of the overall market went exactly nowhere. Did I select that time period deliberately? Absolutely, but more to illustrate how strong economic fundamentals married with a long term Treasury bear market can lead to very underwhelming results. Itā€™s not an environment anyone today has experienced.

Others have selected decade long time period surrounding various advances and subsequent declines to show that, longer term, investors who stayed the course came out with a good result. All true for the periods selected, but Iā€™d point out that none of those periods involve a sustained movement higher in yields. And we donā€™t need a return to late 1970s or early 1980s levels of inflations or rates for a re-rating of multiples to occur.

So if this was to reoccur(60s event) where would you place your investments? Seems like most are trying to gamble the inflationary expectations by going hard into Crypto rather than Gold/Silver.
 
Cramer said that next job report is very important. If itā€™s good, ā€œexpect the tsunami of selling.ā€

  • If we get any strength here at all, any strength, please brace yourself for another tsunami of selling as interest rates go higher and stocks go lower,ā€ CNBCā€™s Jim Cramer said about the Labor Departmentā€™s looming non-farm payroll report to release Friday.

  • ā€œWithout an ugly set of numbers, the growth stocks are in trouble,ā€ the ā€œMad Moneyā€ host said.
I think Iā€™m going to go back to 25-30% equity before next Friday since there will be basically no gain or loss from my Thursday-Friday purchases. If Cramer is right, those techs will be down another 3-5% for overall down 20%. Iā€™ll have the opportunity to buy more later since the pain will be for a few weeks. I knew I probably brought too much too early. Those stocks will take time to recover.

 
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I havenā€™t read anyone predict we are headed for a 1929 market crash and prelude to a 1930s style depression. What Iā€™ve pointed out, however, is current prices donā€™t reflect or discount much in the way of risks. To illustrate that point, I compared the current time period to the mid 1960s to show that strong economic performance, while certainly a very important variable, is not the sole determinative driver of equity prices. Ignoring opportunity costs, and how they are likely to evolve, was the message. Then, like now, rates were very low. Then, rates began a multi-decade climb and stocks went exactly nowhere. Had you placed a large amount of money into the market at that time, you would have enjoyed dividends that perhaps were reinvested, but the absolute level of the overall market went exactly nowhere. Did I select that time period deliberately? Absolutely, but more to illustrate how strong economic fundamentals married with a long term Treasury bear market can lead to very underwhelming results. Itā€™s not an environment anyone today has experienced.

Others have selected decade long time period surrounding various advances and subsequent declines to show that, longer term, investors who stayed the course came out with a good result. All true for the periods selected, but Iā€™d point out that none of those periods involve a sustained movement higher in yields. And we donā€™t need a return to late 1970s or early 1980s levels of inflations or rates for a re-rating of multiples to occur.
Sorry, but the 60s seemed pretty good for the S&P:

1969 -8.50
1968 11.06
1967 23.98
1966 -10.06
1965 12.45
1964 16.48
1963 22.80
1962 -8.73
1961 26.89
1960 0.47

And actually, from 1970 to 1972 returns were strong up until the energy crisis and crash of 1973-1974.


This sounds how strong the S&P has been over the years. It was up in 1987 (didn't expect that). Obviously, 2000-2002 was the biggest bear in recent history due to the dot.com bubble and 9/11.
 
Sorry, but the 60s seemed pretty good for the S&P:

1969 -8.50
1968 11.06
1967 23.98
1966 -10.06
1965 12.45
1964 16.48
1963 22.80
1962 -8.73
1961 26.89
1960 0.47

And actually, from 1970 to 1972 returns were strong up until the energy crisis and crash of 1973-1974.


This sounds how strong the S&P has been over the years. It was up in 1987 (didn't expect that). Obviously, 2000-2002 was the biggest bear in recent history due to the dot.com bubble and 9/11.

Iā€™ve pointed to the period from 1965 through 1981, which corresponds to the aforementioned Treasury bear market.
 
Cramer said that next job report is very important. If itā€™s good, ā€œexpect the tsunami of selling.ā€

  • If we get any strength here at all, any strength, please brace yourself for another tsunami of selling as interest rates go higher and stocks go lower,ā€ CNBCā€™s Jim Cramer said about the Labor Departmentā€™s looming non-farm payroll report to release Friday.

  • ā€œWithout an ugly set of numbers, the growth stocks are in trouble,ā€ the ā€œMad Moneyā€ host said.
I think Iā€™m going to go back to 25-30% equity before next Friday since there will be basically no gain or loss from my Thursday-Friday purchases. If Cramer is right, those techs will be down another 3-5% for overall down 20%. Iā€™ll have the opportunity to buy more later since the pain will be for a few weeks. I knew I probably brought too much too early. Those stocks will take time to recover.

Re: tech, I would be comfortable sticking with names like Amazon, Alphabet, Apple, FB. Itā€™s the speculative tech that is in trouble. Alphabet should thrive in a reopening environment especially as travel and leisure search and ads skyrocket.
 
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Re: tech, I would be comfortable sticking with names like Amazon, Alphabet, Apple, FB. Itā€™s the speculative tech that is in trouble. Alphabet should thrive in a reopening environment especially as travel and leisure search and ads skyrocket.
All tech will thrive in a reopening/normal environment.
 
All tech will thrive in a reopening/normal environment.
I disagree - and it depends on what you mean by ā€œreopening/normal environmentā€. Reopening is already priced into a lot of stocks, and rates will dictate the market. If inflation or rates spike because we are all having a great time and money is flowing too rapidly it will result in a dangerously volatile market. And spec tech + SPACs = plunge. Keep in mind that packed restaurants and increased travel doesnā€™t necessarily move the market. On the other hand, if inflation and rates remain in-check and stimulus money makes its way through the economy it could be a good year for stocks.
 
Re: tech, I would be comfortable sticking with names like Amazon, Alphabet, Apple, FB. Itā€™s the speculative tech that is in trouble. Alphabet should thrive in a reopening environment especially as travel and leisure search and ads skyrocket.
I agree. I typically buy the techs with PE and not the ones base on sales. They will all get hit,as well as the entire market, but the ones base on sales will be hit the hardest.
 
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