[Discussion] Will the Next one be the Worst Recession in History?

[Warhippy]

Aaaand the sell offs have begun.  

Dead cat bounce

 

Bond yields sinking.  10 year treasury note 0.7% alone

 

Oil prices tanking even with the OPEC meeting and suggesting of a 1.5% cut

 

S&P alone fell more than 3% 

 

Dow and NASDAQ flirting with a 3% drop as well to start the day

 

Overall it's ugly.  Some European markets losing 5% or more.  Asian markets down.  South American Markets starting to be affected.

 

https://markets.businessinsider.com/indices/world-stock-markets

[nuckin_futz]

Some have been wondering where interest rates are heading. The Federal Reserve and the Bank of Canada both cut rates .5% this week to 1.25%

 

Markets are unimpressed and are doing their best to force more cuts. Below are charts of the 10yr note yields in Canada and the US. Bit of a swan dive going on there.

 

 

Edited March 6, 2020 by nuckin_futz

[Warhippy]

14 minutes ago, nuckin_futz said:

Some have been wondering where interest rates are heading. The Federal Reserve and the Bank of Canada both cut rates .5% this week to 1.25%

 

Markets are unimpressed and are doing their best to force more cuts. Below are charts of the 10yr note yields in Canada and the US. Bit of a swan dive going on there.

 

 

It's interesting times we're in

[Boudrias]

I see this as an opportunity. Between people panic and a massive share of the market controlled by ETF’s the move down is providing excellent buys. Look for low debt companies, high margins, steady cash flows. There will be a cure for this virus and the world will continue. Bonds will not be a long term option. 

 

The biggest issue is not the virus but world debt. It will kill more people than the virus will. There is no easy fix and it will get nasty.

[Tortorella's Rant]

So how do you know when it's a 'good time to buy.' Nobody can truly predict the market of course, but how can you be fairly certain it's bottomed out and try to get the most bang for your buck? Such as 2008/2009. How were people certain the market would stomp imploding and it was safe to get back into the game. Some people are saying it's due for a massive correction and the DOW is really around the 22,000 mark. Some people say they pulled all their money out of the market two weeks ago meaning either they know something I don't or took a big guess. But then I don't see the point of that either unless you're retired or have nothing but risky equities. I'm in for the 'long game.' I have cash sitting around. I didn't pump any more cash into my account last week/this week because of the whole dead cat bounce which appears to be the case. 

[Boudrias]

3 minutes ago, Tortorella's Rant said:

So how do you know when it's a 'good time to buy.' Nobody can truly predict the market of course, but how can you be fairly certain it's bottomed out and try to get the most bang for your buck? Such as 2008/2009. How were people certain the market would stomp imploding and it was safe to get back into the game. Some people are saying it's due for a massive correction and the DOW is really around the 22,000 mark. Some people say they pulled all their money out of the market two weeks ago meaning either they know something I don't or took a big guess. But then I don't see the point of that either unless you're retired or have nothing but risky equities. I'm in for the 'long game.' I have cash sitting around. I didn't pump any more cash into my account last week/this week because of the whole dead cat bounce which appears to be the case. 

No one knows and that is what creates a market. Even today during a sell off there are buyers. I am one of those old guys and focus on blue chip stocks to hold over the years. Some I have owned for 20 years. Build your core group, establish a cash flow in the portfolio and market timing becomes less of an issue. 

 

The issue that haunts every investor is whether this time it is different. We have been thru 10 years of up markets and complacency can happen. I like to think of myself as a value investor, a quant guy, That makes a lot of sense at a market PE 14 but does it ar PE 21?

At some point equilibrium reestablishes itself. 

[nuckin_futz]

24 minutes ago, Tortorella's Rant said:

So how do you know when it's a 'good time to buy.' Nobody can truly predict the market of course, but how can you be fairly certain it's bottomed out and try to get the most bang for your buck? Such as 2008/2009. How were people certain the market would stomp imploding and it was safe to get back into the game. Some people are saying it's due for a massive correction and the DOW is really around the 22,000 mark. Some people say they pulled all their money out of the market two weeks ago meaning either they know something I don't or took a big guess. But then I don't see the point of that either unless you're retired or have nothing but risky equities. I'm in for the 'long game.' I have cash sitting around. I didn't pump any more cash into my account last week/this week because of the whole dead cat bounce which appears to be the case. 

Dollar cost averaging will take a lot of the guess work out of it. How can you be certain it's bottomed? Look for the news flow to get better. Also when you can look at a daily chart and point to a certain spot and say "that was the bottom".

 

In 2008 it was clear when the Feds made it clear they were going to bail everyone out and stimulate the crap out of everything. This became clear when they let Lehman Brothers go belly up and the crap hit the fan then 2 days later they bailed out AIG. In Europe you had ECB head Mario Draghi's infamous "wherever it takes" comment.

 

People who say they got out at the top or in at the bottom are often lying.

 

Bottom line is money (interest rates) is becoming cheaper. This makes bond yields unattractive. So the only alternatives are real estate and stocks. Once the noise clears the path forward will be clear. The central banks are never going to let this go, they're in too deep to do the right thing.

Edited March 6, 2020 by nuckin_futz

[Boudrias]

10 minutes ago, nuckin_futz said:

Dollar cost averaging will take a lot of the guess work out of it. How can you be certain it's bottomed? Look for the news flow to get better. Also when you can look at a daily chart and point to a certain spot and say "that was the bottom".

 

In 2008 it was clear when the Feds made it clear they were going to bail everyone out and stimulate the crap out of everything. This became clear when they let Lehman Brothers go belly up and the crap hit the fan then 2 days later they bailed out AIG. In Europe you had ECB head Mario Draghi's infamous "wherever it takes" comment.

 

People who say they got out at the top or in at the bottom are often lying.

 

Bottom line is money (interest rates) is becoming cheaper. This makes bond yields unattractive. So the only alternatives are real estate and stocks. Once the noise clears the path forward will be clear. The central banks are never going to let this go, they're in too deep to do the right thing.

As long as politicians have the ability to deficit finance they and their appointees will never be accountable and hard decisions will never be made. What happens when people no longer buy government bonds? It is a huge confidence game and when institutions were bailed out in 2008 it had to do with maintaining confidence in the system. Devaluing currencies has been going on since. 

[nuckin_futz]

2 minutes ago, Boudrias said:

As long as politicians have the ability to deficit finance they and their appointees will never be accountable and hard decisions will never be made. What happens when people no longer buy government bonds? It is a huge confidence game and when institutions were bailed out in 2008 it had to do with maintaining confidence in the system. Devaluing currencies has been going on since. 

They'll be made eventually when they lose control and the market forces them to. People don't really buy the bulk of government bonds, central banks do.

 

Everyone wants to devalue their currency but it's a lot harder to do than it sounds. It takes a big commitment and a lot of effort to do. I'm sure if dollar/yen falls to 100 the Japanese will give it a go.

[Boudrias]

38 minutes ago, nuckin_futz said:

They'll be made eventually when they lose control and the market forces them to. People don't really buy the bulk of government bonds, central banks do.

 

Everyone wants to devalue their currency but it's a lot harder to do than it sounds. It takes a big commitment and a lot of effort to do. I'm sure if dollar/yen falls to 100 the Japanese will give it a go.

Don’t you think central bank balance sheets are a government ran Ponzi scheme?

[Lancaster]

1 hour ago, Tortorella's Rant said:

So how do you know when it's a 'good time to buy.' Nobody can truly predict the market of course, but how can you be fairly certain it's bottomed out and try to get the most bang for your buck? Such as 2008/2009. How were people certain the market would stomp imploding and it was safe to get back into the game. Some people are saying it's due for a massive correction and the DOW is really around the 22,000 mark. Some people say they pulled all their money out of the market two weeks ago meaning either they know something I don't or took a big guess. But then I don't see the point of that either unless you're retired or have nothing but risky equities. I'm in for the 'long game.' I have cash sitting around. I didn't pump any more cash into my account last week/this week because of the whole dead cat bounce which appears to be the case. 

There are entire fields, staffs, etc... all dedicated to timing the markets.  Technical analysis, economic indicators, etc... I'm a finance major doing a MSc in Finance... and I've just barely scratch the surface of it.  

 

There's one very interesting indicator I've read before.... the more scantily clad women's fashion is, it's usually mean it's in a booming market.  Think of the late 90's (prior to the tech bust) and the mid-2000's (before the "Great Recession"), mini-skirts, thongs showing, etc where all the rage.   When fashion changes to something more modest.... it means a decline/recession is coming.  Apparently it's like 80% accurate or something.  

[nuckin_futz]

54 minutes ago, Boudrias said:

Don’t you think central bank balance sheets are a government ran Ponzi scheme?

In a ponzi scheme there is the illusion of money. Central Banks have a printing press. So there is money there.

 

Let me put it like this. If Bernie Madoff had access to a printing press he's not sitting in prison as we speak.

Edited March 6, 2020 by nuckin_futz

[nuckin_futz]

31 minutes ago, Lancaster said:

There are entire fields, staffs, etc... all dedicated to timing the markets.  Technical analysis, economic indicators, etc... I'm a finance major doing a MSc in Finance... and I've just barely scratch the surface of it.  

 

There's one very interesting indicator I've read before.... the more scantily clad women's fashion is, it's usually mean it's in a booming market.  Think of the late 90's (prior to the tech bust) and the mid-2000's (before the "Great Recession"), mini-skirts, thongs showing, etc where all the rage.   When fashion changes to something more modest.... it means a decline/recession is coming.  Apparently it's like 80% accurate or something.  

Some basic technical analysis can be very useful. Price, volume, a couple moving averages, maybe some trend lines.

 

Some people go way overboard with it. Hence the phrase "paralysis of analysis". If you ever see someone whose charts look like this.........

 

 

I'd be willing to bet they are not successful. 

 

This mini skirt thing sounds like more of a lagging indicator. Isn't it human nature to change your habits after the crap hits the fan?

Edited March 6, 2020 by nuckin_futz

[D-Money]

26 minutes ago, Lancaster said:

There are entire fields, staffs, etc... all dedicated to timing the markets.  Technical analysis, economic indicators, etc... I'm a finance major doing a MSc in Finance... and I've just barely scratch the surface of it.  

 

There's one very interesting indicator I've read before.... the more scantily clad women's fashion is, it's usually mean it's in a booming market.  Think of the late 90's (prior to the tech bust) and the mid-2000's (before the "Great Recession"), mini-skirts, thongs showing, etc where all the rage.   When fashion changes to something more modest.... it means a decline/recession is coming.  Apparently it's like 80% accurate or something.  

Pics or shens

[Shift-4]

whoa, wait

I can start wearing a thong again?

[Lancaster]

1 hour ago, D-Money said:

Pics or shens

It was one of those Mark Leibovit annual reports I had few a years back.  

 

As for pics, you can find them anywhere  

Or better yet....

 

 

Edited March 6, 2020 by Lancaster

[RUPERTKBD]

2 hours ago, Lancaster said:

There are entire fields, staffs, etc... all dedicated to timing the markets.  Technical analysis, economic indicators, etc... I'm a finance major doing a MSc in Finance... and I've just barely scratch the surface of it.  

 

There's one very interesting indicator I've read before.... the more scantily clad women's fashion is, it's usually mean it's in a booming market.  Think of the late 90's (prior to the tech bust) and the mid-2000's (before the "Great Recession"), mini-skirts, thongs showing, etc where all the rage.   When fashion changes to something more modest.... it means a decline/recession is coming.  Apparently it's like 80% accurate or something.  

So....as far as Cardi B and Rihanna are concerned, it's a bull market?

[RUPERTKBD]

1 hour ago, Shift-4 said:

whoa, wait

I can start wearing a thong again?

...just so long as you don't go out in public....

[Shift-4]

18 minutes ago, RUPERTKBD said:

...just so long as you don't go out in public....

where else am I going to go?

[PhillipBlunt]

1 hour ago, Shift-4 said:

whoa, wait

I can start wearing a thong again?