Stock Market

75,462 Views | 820 Replies | Last: 16 days ago by DiabloWags
DiabloWags
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82gradDLSdad said:

I'll leave everyone with this bit of investing hindsight...had I just left my S&P like fund alone in my first phone company 401k and kept adding to it I'm positive I'd be much richer. I got smart and first moved into a globally diversified set of index funds and then even smarter by selling calls and puts against this portfolio. Luckily, I'm first and foremost a saver and a live well below your means person. My wife is too. I guess that's the key unless you just make an awful lot of money. Good luck to you all.

Keeping your expenses low really does give you a big advantage.
Especially in times like these when the Bear comes swooping in and makes everyone feel poorer.
oski003
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dajo9 said:

82gradDLSdad said:

I'll leave everyone with this bit of investing hindsight...had I just left my S&P like fund alone in my first phone company 401k and kept adding to it I'm positive I'd be much richer. I got smart and first moved into a globally diversified set of index funds and then even smarter by selling calls and puts against this portfolio. Luckily, I'm first and foremost a saver and a live well below your means person. My wife is too. I guess that's the key unless you just make an awful lot of money. Good luck to you all.
This. I used to do more frequent trading and realized I was better off buying and holding (with occasional macro-economic trades). Benign neglect. Go to the beach. Everybody's trading record seems to be spotless when they report out after-the-fact. I'd rather hear what people are doing in real time, as we all know sometimes all of us are wrong with the market.
I bought SIDUS today at $1.50 PPS (around 25 Million Market Cap).

https://newsfilter.io/a/04401401374bb82d98cade7f1aa76dae

Obviously a gamble buying stock in a a non-profitable small company. They IPO'd at $27 PPS not very long ago and have been getting destroyed. This is not bill paying money but am curious if anyone has any thoughts on it. I don't have stock in any of the other space tickers I posted.
oski003
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Also, wanted to add that max 401K contribution has increased from 18.5K to 20.5K. I also bought my max in I Bonds this year as I posted earlier.
DiabloWags
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OdontoBear66 said:



Hey when I go away from the % numbers and look at the actuals it gives a lot of pain. But I am getting excited that soon we will be having the escalator going back up....How soon is the question...Good earnings, good valuations key.


I'm literally praying for a Recession so that Mr. Market can start anticipating lower rates again.
Until then, fixed income will provide competition to equities and analyst cash flow models.

The FED needs to at least get back to "neutral".
According to Powell, we are at least 150 basis points away.
And that means several months of 50 basis point increases in order to "catch-up".

It's anyone's guess as to when we will begin to see an easing of inflationary pressures.
Tons of chart patterns are broken and will need to see stabilization and lots of backing and filling.
That's gonna take time.

Until then, I will just continue to listen to my favorite management team's presentations and earnings calls to see if they can continue to execute at a high level and drive growth. Multiples have compressed to unbelievable levels. I think this is partially due to what I call machine selling.

I simply cant think of another reason why a company is trading at only 3.5 to 4.5x sales with a massive IP moat, really good margins, and 2022 guidance being increased on a recent Q1 earnings call.






dajo9
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DiabloWags said:

OdontoBear66 said:



Hey when I go away from the % numbers and look at the actuals it gives a lot of pain. But I am getting excited that soon we will be having the escalator going back up....How soon is the question...Good earnings, good valuations key.


I'm literally praying for a Recession so that Mr. Market can start anticipating lower rates again.
Until then, fixed income will provide competition to equities and analyst cash flow models.

The FED needs to at least get back to "neutral".
According to Powell, we are at least 150 basis points away.
And that means several months of 50 basis point increases in order to "catch-up".

It's anyone's guess as to when we will begin to see an easing of inflationary pressures.

Until then, I will just continue to listen to my favorite management team's presentations and earnings calls to see if they can continue to execute at a high level and drive growth. Multiples have compressed to unbelievable levels. I think this is partially due to what I call machine selling.

I simply cant think of another reason why a company is trading at only 3.5 to 4.5x sales with a massive IP moat, really good margins, and 2022 guidance being increased on a recent Q1 earnings call.









The soon-to-be-unemployed are at your service
DiabloWags
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dajo9 said:

DiabloWags said:

OdontoBear66 said:



Hey when I go away from the % numbers and look at the actuals it gives a lot of pain. But I am getting excited that soon we will be having the escalator going back up....How soon is the question...Good earnings, good valuations key.


I'm literally praying for a Recession so that Mr. Market can start anticipating lower rates again.
Until then, fixed income will provide competition to equities and analyst cash flow models.

The FED needs to at least get back to "neutral".
According to Powell, we are at least 150 basis points away.
And that means several months of 50 basis point increases in order to "catch-up".

It's anyone's guess as to when we will begin to see an easing of inflationary pressures.

Until then, I will just continue to listen to my favorite management team's presentations and earnings calls to see if they can continue to execute at a high level and drive growth. Multiples have compressed to unbelievable levels. I think this is partially due to what I call machine selling.

I simply cant think of another reason why a company is trading at only 3.5 to 4.5x sales with a massive IP moat, really good margins, and 2022 guidance being increased on a recent Q1 earnings call.









The soon-to-be-unemployed are at your service

If this Bear keeps up, I might be working at Home Depot.
Check the Garden Center.
82gradDLSdad
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oski003 said:

Also, wanted to add that max 401K contribution has increased from 18.5K to 20.5K. I also bought my max in I Bonds this year as I posted earlier.


Max 401k and max Ibonds is what I did during my best earning years. The more years you can do this the richer you will be...almost without doubt.
dimitrig
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82gradDLSdad said:

oski003 said:

Also, wanted to add that max 401K contribution has increased from 18.5K to 20.5K. I also bought my max in I Bonds this year as I posted earlier.


Max 401k and max Ibonds is what I did during my best earning years. The more years you can do this the richer you will be...almost without doubt.

Why I Bonds instead of TIPS?


oski003
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dimitrig said:

82gradDLSdad said:

oski003 said:

Also, wanted to add that max 401K contribution has increased from 18.5K to 20.5K. I also bought my max in I Bonds this year as I posted earlier.


Max 401k and max Ibonds is what I did during my best earning years. The more years you can do this the richer you will be...almost without doubt.

Why I Bonds instead of TIPS?




Tell me more about TIPS?
82gradDLSdad
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dimitrig said:

82gradDLSdad said:

oski003 said:

Also, wanted to add that max 401K contribution has increased from 18.5K to 20.5K. I also bought my max in I Bonds this year as I posted earlier.


Max 401k and max Ibonds is what I did during my best earning years. The more years you can do this the richer you will be...almost without doubt.

Why I Bonds instead of TIPS?





I only saw TIPs funds and bond funds weren't that attractive over the years I invested. Ibonds we're pretty easy to understand although buying them through Treasury direct and the limits on how much you could buy was and is a pain. Ibonds will yield over 9% the next 6 months!!!
Unit2Sucks
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oski003 said:

dajo9 said:

82gradDLSdad said:

I'll leave everyone with this bit of investing hindsight...had I just left my S&P like fund alone in my first phone company 401k and kept adding to it I'm positive I'd be much richer. I got smart and first moved into a globally diversified set of index funds and then even smarter by selling calls and puts against this portfolio. Luckily, I'm first and foremost a saver and a live well below your means person. My wife is too. I guess that's the key unless you just make an awful lot of money. Good luck to you all.
This. I used to do more frequent trading and realized I was better off buying and holding (with occasional macro-economic trades). Benign neglect. Go to the beach. Everybody's trading record seems to be spotless when they report out after-the-fact. I'd rather hear what people are doing in real time, as we all know sometimes all of us are wrong with the market.
I bought SIDUS today at $1.50 PPS (around 25 Million Market Cap).

https://newsfilter.io/a/04401401374bb82d98cade7f1aa76dae

Obviously a gamble buying stock in a a non-profitable small company. They IPO'd at $27 PPS not very long ago and have been getting destroyed. This is not bill paying money but am curious if anyone has any thoughts on it. I don't have stock in any of the other space tickers I posted.
A lot of companies that have the same financial profile as SIDUS are going to go out of business. Looks like SIDUS has 1 year + of cash on the balance sheet and needs to raise money to continue as a going concern. If they are able to save the company and turn it into a real business, you will make a strong return on your investment.

I don't know anything about SIDUS specifically but I recently spent some time with the CFO of Relativity Space and learned a bit more about that industry. I would say that I learned that it's difficult as an outsider to separate the BS from the substance and that regulatory overlay is going to have a big say in how successful most of the players are.
DiabloWags
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Unit2Sucks said:


A lot of companies that have the same financial profile as SIDUS are going to go out of business. Looks like SIDUS has 1 year + of cash on the balance sheet and needs to raise money to continue as a going concern. If they are able to save the company and turn it into a real business, you will make a strong return on your investment.



Great minds think alike!
That was the very first thing that I went to check.
Basically no more than 1 year of cash on the balance sheet given the current quarterly losses.
If they truly have some IP, they might get bought out by someone like L-3 Harris or Lockheed Martin.


cbbass1
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DiabloWags said:

OdontoBear66 said:



Hey when I go away from the % numbers and look at the actuals it gives a lot of pain. But I am getting excited that soon we will be having the escalator going back up....How soon is the question...Good earnings, good valuations key.


I'm literally praying for a Recession so that Mr. Market can start anticipating lower rates again.
Until then, fixed income will provide competition to equities and analyst cash flow models.

The FED needs to at least get back to "neutral".
According to Powell, we are at least 150 basis points away.
And that means several months of 50 basis point increases in order to "catch-up".

It's anyone's guess as to when we will begin to see an easing of inflationary pressures.
Tons of chart patterns are broken and will need to see stabilization and lots of backing and filling.
That's gonna take time.

Until then, I will just continue to listen to my favorite management team's presentations and earnings calls to see if they can continue to execute at a high level and drive growth. Multiples have compressed to unbelievable levels. I think this is partially due to what I call machine selling.

I simply cant think of another reason why a company is trading at only 3.5 to 4.5x sales with a massive IP moat, really good margins, and 2022 guidance being increased on a recent Q1 earnings call.

I think your prayers will be answered, DW. I just don't see how we avoid going right into Depression territory. The Fed is signaling that reducing inflation is it's top priority, and avoiding Depression & massive unemployment aren't really on the radar.

And yes, the price gouging and supply shortages that are driving most of our inflation will continue. As many wailed in response to the Covid shutdowns in 2020, "Don't make the cure worse than the disease!"

In a bull market, you buy the dips. In a bear market, you sell the peaks. So I did the inverse-equivalent: Bought a few hundred shares of TZA at $43.96/share. TZA is an inverse index fund that increases 3:1 to decreases in the Russell 2000.
DiabloWags
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cbbass1 said:

DiabloWags said:

OdontoBear66 said:



Hey when I go away from the % numbers and look at the actuals it gives a lot of pain. But I am getting excited that soon we will be having the escalator going back up....How soon is the question...Good earnings, good valuations key.


I'm literally praying for a Recession so that Mr. Market can start anticipating lower rates again.
Until then, fixed income will provide competition to equities and analyst cash flow models.

The FED needs to at least get back to "neutral".
According to Powell, we are at least 150 basis points away.
And that means several months of 50 basis point increases in order to "catch-up".

It's anyone's guess as to when we will begin to see an easing of inflationary pressures.
Tons of chart patterns are broken and will need to see stabilization and lots of backing and filling.
That's gonna take time.

Until then, I will just continue to listen to my favorite management team's presentations and earnings calls to see if they can continue to execute at a high level and drive growth. Multiples have compressed to unbelievable levels. I think this is partially due to what I call machine selling.

I simply cant think of another reason why a company is trading at only 3.5 to 4.5x sales with a massive IP moat, really good margins, and 2022 guidance being increased on a recent Q1 earnings call.

I think your prayers will be answered, DW. I just don't see how we avoid going right into Depression territory. The Fed is signaling that reducing inflation is it's top priority, and avoiding Depression & massive unemployment aren't really on the radar.

And yes, the price gouging and supply shortages that are driving most of our inflation will continue. As many wailed in response to the Covid shutdowns in 2020, "Don't make the cure worse than the disease!"

In a bull market, you buy the dips. In a bear market, you sell the peaks. So I did the inverse-equivalent: Bought a few hundred shares of TZA at $43.96/share. TZA is an inverse index fund that increases 3:1 to decreases in the Russell 2000.

It's sad, but I dont believe that the FED has been able to engineer a "soft" landing since 1994.
I hope that you and I are both wrong, but the odds just arent with us.

Powell has (already) lost a lot of credibility . . . and I think he's capable of losing even more.
They've never embarked upon a strategy of raising rates AND simultaneous drawing down
their balance sheet. - - - Definitely uncharted waters for sure!
DiabloWags
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Univ. of Michigan's Consumer Sentiment fell to 59.1 from 65.2 in April.



DiabloWags
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Down 980 points at 1:40pm Eastern.

S&P down a whopping 140 points (-3.3%)

Nasdaq off 490 points (44.0%)

Nothing to see here.

dajo9
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DiabloWags said:

Down 980 points at 1:40pm Eastern.

S&P down a whopping 140 points (-3.3%)

Nasdaq off 490 points (44.0%)

Nothing to see here.




And the Fed balance sheet still hasn't even gone down yet
DiabloWags
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dajo9 said:

DiabloWags said:

Down 980 points at 1:40pm Eastern.

S&P down a whopping 140 points (-3.3%)

Nasdaq off 490 points (44.0%)

Nothing to see here.




And the Fed balance sheet still hasn't even gone down yet

They are so far away from a "neutral" Fed Funds rate (2.25 - 2.50%) that it's just not funny.

Most likely will see several 50 basis point rate increases over the next several months to get close to that rate.
I believe that the balance sheet "trimming" (run-off) is supposed to start in JUNE.

Initially, there will simply be "run-off" of debt that's maturing.
The pace will be capped initially at $30 Billion a month for Treasuries and $17.5 Billion per month for MBS.
These caps will double after three months, implying that the Fed's security holdings will decline by up to $95 Billion a month. The Fed estimates that such balance sheet "normalization" is equivalent to roughly 50 - 75 basis points of tightening. But these are unchartered waters and no one really knows for sure.

One of the Fed's top priorities is to monitor liquidity in the bond market.
It will be interesting to monitor spreads going forward.
The Fed "Put" revolves around this liquidity gauge.

Relative to U.S. 5 year Treasury securities, the yield on CCC rated debt is widening quickly. That spread grew to 10% last week and is the highest level since late 2020 and around levels where the Fed has previously eased monetary policy to counter slowing economic growth. Some believe that the Fed "Put" is still there, but that it may not come until there is a 15% (1500 basis point) spread between 5 year treasuries and the yield on CCC rated debt.

Will be very interesting to see how the yields behave in non-treasury debt as the Fed continues to tighten and the balance sheet "run-off" increases. There's a lot of RISK that the financial markets will be unable to efficiently absorb the securities running off the Fed's balance sheet.




DiabloWags
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Major retailers announced disappointing quarterly results.

Walmart yesterday (slashed its profit outlook for the year) and Target today did the same highlighting poor operating margins, stating that it could see an additional $1.0 BILLION dollars in transportation costs this year due to rising fuel prices. Target shares (TGT) are currently down 27% today ( - $58.69 ).

Dow Jones is now down 1100 points.
Nasdaq - 555 points
S&P - 160 points

Nothing to see here.




cbbass1
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DiabloWags said:

dajo9 said:

DiabloWags said:

Down 980 points at 1:40pm Eastern.

S&P down a whopping 140 points (-3.3%)

Nasdaq off 490 points (44.0%)

Nothing to see here.




And the Fed balance sheet still hasn't even gone down yet

They are so far away from a "neutral" Fed Funds rate (2.25 - 2.50%) that it's just not funny.

Most likely will see several 50 basis point rate increases over the next several months to get close to that rate.
I believe that the balance sheet "trimming" (run-off) is supposed to start in JUNE.

Initially, there will simply be "run-off" of debt that's maturing.
The pace will be capped initially at $30 Billion a month for Treasuries and $17.5 Billion per month for MBS.
These caps will double after three months, implying that the Fed's security holdings will decline by up to $95 Billion a month. The Fed estimates that such balance sheet "normalization" is equivalent to roughly 50 - 75 basis points of tightening. But these are unchartered waters and no one really knows for sure.

One of the Fed's top priorities is to monitor liquidity in the bond market.
It will be interesting to monitor spreads going forward.
The Fed "Put" revolves around this liquidity gauge.

Relative to U.S. 5 year Treasury securities, the yield on CCC rated debt is widening quickly. That spread grew to 10% last week and is the highest level since late 2020 and around levels where the Fed has previously eased monetary policy to counter slowing economic growth. Some believe that the Fed "Put" is still there, but that it may not come until there is a 15% (1500 basis point) spread between 5 year treasuries and the yield on CCC rated debt.

Will be very interesting to see how the yields behave in non-treasury debt as the Fed continues to tighten and the balance sheet "run-off" increases. There's a lot of RISK that the financial markets will be unable to efficiently absorb the securities running off the Fed's balance sheet.

Did anyone expect that the Fed would be able to avoid a Recession, or worse??

Like I said, there is no "soft landing."

Besides, the interest rate increases are only affecting the small percentage of Inflation that's due to previous increases in money supply. But the price gouging by monopolies with pricing power will continue -- until the recession takes hold, and we see massive layoffs.

Right around election time.

Coincidence?

Finger Pointing Season is about to begin...

Could've avoided all this by imposing a Windfall Profits Tax to discourage price gouging. That would also give producers an incentive to invest in increasing supplies to address supply shortages. That would've killed most of our inflation, and put us pretty close to the 2% target. Then, if there was any more excess inflation remaining, the Fed could address it with monetary policy, when it would be much more effective.

But Capital chooses to scream bloody murder about inflation, and then order a procedure that nearly kills the patient. Why did they choose to jump straight from the Inflation Frying Pan into the Recession/Depression Fire??
DiabloWags
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cbbass1 said:



Did anyone expect that the Fed would be able to avoid a Recession, or worse??

Like I said, there is no "soft landing."

Besides, the interest rate increases are only affecting the small percentage of Inflation that's due to previous increases in money supply. But the price gouging by monopolies with pricing power will continue -- until the recession takes hold, and we see massive layoffs.

Right around election time.

Coincidence?

Finger Pointing Season is about to begin...


No coincidence.
You continue to espouse a Conspiracy Theory that is not based in reality.
To claim that the FED is raising rates to put the Democrats out of power late this year at midterms is absurd.

Just as you believe that the price "gouging" is the primary source of inflation and not the +40% growth in the M2 money supply, energy costs, supply-chain bottlenecks, labor market tightness, etc.

If there was price "gouging" then retailers like Walmart and Target wouldnt be guiding lower and talking about margin pressure. If this was such a GREAT ENVIRONMENT for monopolies in retailing, then a company like Target wouldnt be seeing their stock price collapse 25% today.



dimitrig
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DiabloWags said:

cbbass1 said:



Did anyone expect that the Fed would be able to avoid a Recession, or worse??

Like I said, there is no "soft landing."

Besides, the interest rate increases are only affecting the small percentage of Inflation that's due to previous increases in money supply. But the price gouging by monopolies with pricing power will continue -- until the recession takes hold, and we see massive layoffs.

Right around election time.

Coincidence?

Finger Pointing Season is about to begin...


No coincidence.
You continue to espouse a Conspiracy Theory that is not based in reality.
To claim that the FED is raising rates to put the Democrats out of power late this year at midterms is absurd.

Just as you believe that the price "gouging" is the primary source of inflation and not the +40% growth in the M2 money supply, energy costs, supply-chain bottlenecks, etc.

If there was price "gouging" then retailers like Walmart and Target wouldnt be guiding lower and talking about margin pressure. If this was such a GREAT ENVIRONMENT for monopolies in retailing, then a company like Target wouldnt be seeing their stock price collapse 25% today.

Yet still up 25% from the beginning of 2020 (pre-COVID).






DiabloWags
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dimitrig said:

DiabloWags said:



No coincidence.
You continue to espouse a Conspiracy Theory that is not based in reality.
To claim that the FED is raising rates to put the Democrats out of power late this year at midterms is absurd.

Just as you believe that the price "gouging" is the primary source of inflation and not the +40% growth in the M2 money supply, energy costs, supply-chain bottlenecks, etc.

If there was price "gouging" then retailers like Walmart and Target wouldnt be guiding lower and talking about margin pressure. If this was such a GREAT ENVIRONMENT for monopolies in retailing, then a company like Target wouldnt be seeing their stock price collapse 25% today.

Yet still up 25% from the beginning of 2020 (pre-COVID).








Even with today's 4% decline in the S&P 500, the index is up 22% since before Covid (Jan. 1st, 2020).

If your price "gouging" thesis was correct for a major retailer, you would have expected massive outperformance by Target (TGT) shares. - - - That didnt happen. Their performance is basically in-line with the S&P 500.
dimitrig
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DiabloWags said:

dimitrig said:

DiabloWags said:



No coincidence.
You continue to espouse a Conspiracy Theory that is not based in reality.
To claim that the FED is raising rates to put the Democrats out of power late this year at midterms is absurd.

Just as you believe that the price "gouging" is the primary source of inflation and not the +40% growth in the M2 money supply, energy costs, supply-chain bottlenecks, etc.

If there was price "gouging" then retailers like Walmart and Target wouldnt be guiding lower and talking about margin pressure. If this was such a GREAT ENVIRONMENT for monopolies in retailing, then a company like Target wouldnt be seeing their stock price collapse 25% today.

Yet still up 25% from the beginning of 2020 (pre-COVID).

TGT being up 25% since early 2020 has nothing to do with anything.
It's a nothing-burger.

Even with today's 4% decline in the S&P 500, the index is up 22% since before Covid (Jan. 1st, 2020).
If your price "gouging" thesis was correct for a major retailer, you would have expected massive outperformance by Target (TGT) shares. - - - That didnt happen. It's perfectly in-line with the S&P 500.


It's not my price gouging thesis and I am not even commenting on that.

My point is that this is hardly some sort of collapse in TGT stock. As you state, this is in line with the S&P 500, which is actually still up significantly over the last 2 years.





DiabloWags
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dimitrig said:



It's not my price gouging thesis and I am not even commenting on that.

My point is that this is hardly some sort of collapse in TGT stock. As you state, this is in line with the S&P 500, which is actually still up significantly over the last 2 years.







Huh?

I have a feeling that anyone who owns shares of TGT today is NOT in agreement with you and thinking that this is hardly some sort of collapse in TGT stock.

Target hasnt traded this low since October of 2020.
That's a whole lot of investors that are underwater.



dimitrig
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DiabloWags said:

dimitrig said:



It's not my price gouging thesis and I am not even commenting on that.

My point is that this is hardly some sort of collapse in TGT stock. As you state, this is in line with the S&P 500, which is actually still up significantly over the last 2 years.







Huh?

I have a feeling that anyone who owns shares of TGT today is NOT in agreement with you and thinking that this is hardly some sort of collapse in TGT stock.

Target hasnt traded this low since October of 2020.
That's a whole lot of investors that are underwater.

You have the mindset of a trader, not an investor.

cbbass1
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DiabloWags said:

cbbass1 said:



Did anyone expect that the Fed would be able to avoid a Recession, or worse??

Like I said, there is no "soft landing."

Besides, the interest rate increases are only affecting the small percentage of Inflation that's due to previous increases in money supply. But the price gouging by monopolies with pricing power will continue -- until the recession takes hold, and we see massive layoffs.

Right around election time.

Coincidence?

Finger Pointing Season is about to begin...


No coincidence.
You continue to espouse a Conspiracy Theory that is not based in reality.
To claim that the FED is raising rates to put the Democrats out of power late this year at midterms is absurd.

Just as you believe that the price "gouging" is the primary source of inflation and not the +40% growth in the M2 money supply, energy costs, supply-chain bottlenecks, labor market tightness, etc.

If there was price "gouging" then retailers like Walmart and Target wouldnt be guiding lower and talking about margin pressure. If this was such a GREAT ENVIRONMENT for monopolies in retailing, then a company like Target wouldnt be seeing their stock price collapse 25% today.

Once again, thanks for reinforcing my point.

If you read what I said more carefully, I said that most of inflation now is due to price gouging by monopolies; 2nd leading cause is continuing supply chain disruptions.

Maybe you didn't notice, but the price gouging in oil & gasoline, by energy monopolies, is part of our "higher energy costs" component.

Yes, the 40% growth in M2 is the classic definition of inflation. But it only forces an increase in the CPI when Consumers have a large percentage of that money. But that money went through the economy months ago, and now it's most likely sitting on the balance sheet of some monopoly/corporation/oligarch. At this point, it's NOT sitting in the pockets of Consumers, burning a hole.

That's why, in another one of your previous posts, you showed that CFOs were mentioning "Weak Demand" in an alarming number of conference calls -- a glaring indicator that Consumer Demand was too weak, rather than too strong.

If the mechanism of increasing interest rates is intended to reduce borrowing and weaken Consumer Demand, then why do it -- especially when Consumer Demand is already dangerously weak, and it obviously won't affect the other components of CPI-based inflation?

The politics isn't the only reason for crashing the economy. The other part, as I mentioned before, is to get rid of "tightness" in the labor market, and to make it much more difficult for the embryonic U.S. Labor movement to take hold.

You might want to go through the details of all these arguments that you're making & do a little sanity/consistency check, rather than criticizing the rest of us for being "economically illiterate."
DiabloWags
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dimitrig said:

DiabloWags said:

dimitrig said:



It's not my price gouging thesis and I am not even commenting on that.

My point is that this is hardly some sort of collapse in TGT stock. As you state, this is in line with the S&P 500, which is actually still up significantly over the last 2 years.







Huh?

I have a feeling that anyone who owns shares of TGT today is NOT in agreement with you and thinking that this is hardly some sort of collapse in TGT stock.

Target hasnt traded this low since October of 2020.
That's a whole lot of investors that are underwater.

You have the mindset of a trader, not an investor.



I'm not surprised by your characterization, given that you once posted that you couldnt care less if the market fell by 50%.
Never mind that $900 Billion came into stock funds and ETF's last year, which was more than the PREVIOUS 19 YEARS COMBINED.

Think those investors are sitting on profits?

It sounds like you are fairly young and have never had to endure a Bear Market in price, as well as time.
I'll just leave it at that.


"Cults don't end well. They really don't."
DiabloWags
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cbbass1 said:






The politics isn't the only reason for crashing the economy.

Please explain the basis for your claim that politics is behind crashing the economy.
Be specific.
"Cults don't end well. They really don't."
calbear93
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cbbass1 said:

DiabloWags said:

cbbass1 said:



Did anyone expect that the Fed would be able to avoid a Recession, or worse??

Like I said, there is no "soft landing."

Besides, the interest rate increases are only affecting the small percentage of Inflation that's due to previous increases in money supply. But the price gouging by monopolies with pricing power will continue -- until the recession takes hold, and we see massive layoffs.

Right around election time.

Coincidence?

Finger Pointing Season is about to begin...


No coincidence.
You continue to espouse a Conspiracy Theory that is not based in reality.
To claim that the FED is raising rates to put the Democrats out of power late this year at midterms is absurd.

Just as you believe that the price "gouging" is the primary source of inflation and not the +40% growth in the M2 money supply, energy costs, supply-chain bottlenecks, labor market tightness, etc.

If there was price "gouging" then retailers like Walmart and Target wouldnt be guiding lower and talking about margin pressure. If this was such a GREAT ENVIRONMENT for monopolies in retailing, then a company like Target wouldnt be seeing their stock price collapse 25% today.

Once again, thanks for reinforcing my point.

If you read what I said more carefully, I said that most of inflation now is due to price gouging by monopolies; 2nd leading cause is continuing supply chain disruptions.

Maybe you didn't notice, but the price gouging in oil & gasoline, by energy monopolies, is part of our "higher energy costs" component.

Yes, the 40% growth in M2 is the classic definition of inflation. But it only forces an increase in the CPI when Consumers have a large percentage of that money. But that money went through the economy months ago, and now it's most likely sitting on the balance sheet of some monopoly/corporation/oligarch. At this point, it's NOT sitting in the pockets of Consumers, burning a hole.

That's why, in another one of your previous posts, you showed that CFOs were mentioning "Weak Demand" in an alarming number of conference calls -- a glaring indicator that Consumer Demand was too weak, rather than too strong.

If the mechanism of increasing interest rates is intended to reduce borrowing and weaken Consumer Demand, then why do it -- especially when Consumer Demand is already dangerously weak, and it obviously won't affect the other components of CPI-based inflation?

The politics isn't the only reason for crashing the economy. The other part, as I mentioned before, is to get rid of "tightness" in the labor market, and to make it much more difficult for the embryonic U.S. Labor movement to take hold.

You might want to go through the details of all these arguments that you're making & do a little sanity/consistency check, rather than criticizing the rest of us for being "economically illiterate."

You are conflating issues.

When CEOs/CFOs refer to reduced demand, they are not referring to reduction in demand to meet the current level of supply. They are referring to why the growth rate may not be at the high end of the revenue growth guidance. Most companies, including Target, are still having revenue growth. But both gross margins from increase in the cost of sales and profit margin from increased SG&A are, in each case, being impacted by supply not meeting up to demand. You will probably want to take a look at increased backlog levels that you will see at most companies showing the impact of supply chain constraints and companies not being able to manufacture to meet demand.

As far as compensation costs, see what Google, Amazon, Apple and Microsoft have been doing on compensation - significantly increasing compensation across the company, which additional costs are often passed on to their customers, contributing to inflation as well. This is what you get when you have too low of unemployment rate.

Yes, consumers are paying more for less because of inflation and they are focused more on essentials. If companies were engaging in price gouging, this earnings season (other than for energy companies) would have been fantastic. But profits are going down, even with higher sales, and working capital turn is going down meaning that companies are needing to increase their safety stock and pay more for components and inventory.

And if you think the FED is increasing rates for political reasons, I would question how old you are and whether you lived through any inflationary periods or have read about countries experiencing high inflation. This FED royally screwed up because they bought into this concept of transitory inflation like many "experts" here. The only time there have been soft landings have been in those periods where the FED was proactive and started raising rates at the first sign of inflation like 1994. But people here and elsewhere were cheering a runaway stock market because now Biden was president, celebrating dangerously low unemployment rate, and printing more money to fund excess spending in an already overheated demand environment when there were high alert red flags on supply chain constraints as early as 2020 when my friends actually running companies were telling me that they had never seen supply chain constraints with lead time required in their entire career. Just policy makers and experts who never learn from history and who do not realize that inflation may be the most destructive element for the poor and the middle class. People who are so convinced that they know what is going on with their conspiracy theories clearly have never been in management roles to really understanding what really happens in companies and businesses.
DiabloWags
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dimitrig said:

DiabloWags said:



Huh?

I have a feeling that anyone who owns shares of TGT today is NOT in agreement with you and thinking that this is hardly some sort of collapse in TGT stock.

Target hasnt traded this low since October of 2020.
That's a whole lot of investors that are underwater.

You have the mindset of a trader, not an investor.



I have a feeling that you and Cbbass1 werent around for Black Monday of 1987
That's the last time that Target shares plunged as much as they did today.
"Cults don't end well. They really don't."
dimitrig
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DiabloWags said:

dimitrig said:

DiabloWags said:



Huh?

I have a feeling that anyone who owns shares of TGT today is NOT in agreement with you and thinking that this is hardly some sort of collapse in TGT stock.

Target hasnt traded this low since October of 2020.
That's a whole lot of investors that are underwater.

You have the mindset of a trader, not an investor.



I have a feeling that you and Cbbass1 werent around for Black Monday of 1987
That's the last time that Target shares plunged as much as they did today.



I remember Black Monday, although I was not invested.

The markets recovered very quickly.

DiabloWags
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dimitrig said:

DiabloWags said:

dimitrig said:

DiabloWags said:



Huh?

I have a feeling that anyone who owns shares of TGT today is NOT in agreement with you and thinking that this is hardly some sort of collapse in TGT stock.

Target hasnt traded this low since October of 2020.
That's a whole lot of investors that are underwater.

You have the mindset of a trader, not an investor.



I have a feeling that you and Cbbass1 werent around for Black Monday of 1987
That's the last time that Target shares plunged as much as they did today.



I remember Black Monday, although I was not invested.

The markets recovered very quickly.




Markets clearly arent recovering quickly.
They arent recovering at all.
Just ask Cathie Wood.
This isnt 1987.

You dont fight the Fed.
"Cults don't end well. They really don't."
dimitrig
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DiabloWags said:

dimitrig said:

DiabloWags said:

dimitrig said:

DiabloWags said:



Huh?

I have a feeling that anyone who owns shares of TGT today is NOT in agreement with you and thinking that this is hardly some sort of collapse in TGT stock.

Target hasnt traded this low since October of 2020.
That's a whole lot of investors that are underwater.

You have the mindset of a trader, not an investor.



I have a feeling that you and Cbbass1 werent around for Black Monday of 1987
That's the last time that Target shares plunged as much as they did today.


I remember Black Monday, although I was not invested.

The markets recovered very quickly.

Markets clearly arent recovering quickly.
They arent recovering at all.
Just ask Cathie Wood.
This isnt 1987.

You dont fight the Fed.


It depends on your timeline.

If you have conviction in the companies you are invested in then consider this a sale.

It took 7 years to recover after the 2000 Internet bubble popped.

My strategy is as follows:

1. Buy what I know.

This is advice from Warren Buffet, but it is good advice. If I don't know about something I might research it such that I might eventually be educated about it but I don't buy it if I don't understand the business.

2. Know what I own.

I don't buy an investment because it performed well in the past or because some pundit talked it up. In general I am not trying to trade complex derivatives or invest in instruments that don't interest me even if they can be lucrative. I know my limitations.

3. Understand my tolerance for risk.

I never make trades based on fear or fear-of-missing-out. Fearful people sell perfectly good investments just because they had a bad day/week/month/year. People afraid of missing out often buy only at the tops. I am comfortable buying and holding and buying more and holding some more. I know not everyone is like that, but it fits my risk tolerance. I stopped constantly chasing returns a long time ago. I only place bets at the casino when it is for entertainment purposes only.


4. Diversify

The best returns come from picking a handful of winners and riding them for years, but very few people can consistently pick winners. I am not one of them. During the slumps I don't lose any sleep because I understand my tolerance for risk and have allocated my investments appropriately.

5. Focus on the long term

I started investing while I was in high school (Janus Mutual Funds) and I have never sold a position based on what the broader market was doing. I have, however, added to positions when the broader market sentiment was down and took quality names down with it. As I told a coworker once when the Internet bubble popped and my portfolio took a 50% haircut: "The goal is to buy low and sell high, not buy low and sell lower." It took 7 years to recover from that, but it did recover and then some. To me that was a bigger lesson than some Black Friday selloff.




cbbass1
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DiabloWags said:

cbbass1 said:






The politics isn't the only reason for crashing the economy.

Please explain the basis for your claim that politics is behind crashing the economy.
Be specific.

Sure.

Example: Oil companies & the Saudis have a political preference. Though the oil companies invest heavily in the Dems in order to prevent any action on Climate Change, it's clear that the oil companies would prefer to have Republicans in the majority in both House & Senate. The Saudis clearly prefer Trump & Jared over Biden, because they're easier to purchase, less likely to have issues with Mohammed bin Bonesaw, and less likely to interfere with arms sales for their war against Yemen.

On top of that, with the GOP in the majority, Capital will finally be in a position to "run the table", ignore regulations, especially on Labor and the environment, ignore climate change, and rig elections in their favor nationwide.

So the GOP and Capital have a strong financial interest in drowning small-d democracy in the bathtub. This is accomplished by crashing the economy, and then blaming it on the Dems.

It's not just the oil companies. Health insurers and pharmaceuticals also prefer to have GOP majorities in Congress, and to ignore government regulations and regulators, if the 6-3 SCOTUS doesn't declare all regulations of business unconstitutional first.

When the bubble bursts, those who have cash, and lots of it, are in a position to buy companies, properties, and assets for pennies on the dollar. Those companies that were borrowing & rolling over their debt are in a difficult position, and will either go under or sell out.

The other reason for Capital to crash the economy is to re-exert disproportionate leverage over workers. IF I'm correct on this, expect the Recession / Depression that follows to also lead to massive layoffs and unemployment, with Union members being fired en masse, illegally. The last thing that Capital wants is to have millions of unemployed voters having political power, and voting. So the easy solution for Capital is to have the disgruntled masses voting GOP. There, they can lash out with violent rhetoric against Biden & the Democrats, but the Republicans never have to promise them anything economically!
 
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