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    #16
    Well, I know it's making big moves but three years ago today it was ~20,900. That's 3400 points difference from today. It would not be accurate to say this had erased 3 years of growth, since the needle hasn't stabilized and it might very well bounce back in a matter of days.

    There is no such thing as a sure thing whether fortunate or unfortunate. It looks bad but never discount your geese before they're cooked.
    "Pave the way for the little guy, Caligula!" Harry Solomon, September 28, 1999

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      #17
      Originally posted by Dung Beatles View Post
      Well, I know it's making big moves but three years ago today it was ~20,900. That's 3400 points difference from today. It would not be accurate to say this had erased 3 years of growth, since the needle hasn't stabilized and it might very well bounce back in a matter of days.

      There is no such thing as a sure thing whether fortunate or unfortunate. It looks bad but never discount your geese before they're cooked.
      Right now the Dow is just about 100 points above December 2017. My concern is coronavirus is still in its earliest stages. All it takes is a few big dips to really get things tumbling.

      What we really need is some positive news. This is a time when leadership is critical. Right now the leadership is tied up on Twitter.

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        #18
        Originally posted by W. Rabbit View Post

        Right now the Dow is just about 100 points above December 2017. My concern is coronavirus is still in its earliest stages. All it takes is a few big dips to really get things tumbling.

        What we really need is some positive news. This is a time when leadership is critical. Right now the leadership is tied up on Twitter.
        Again, I'd like to refrain from discussing political causation because it's kinda cross contamination with other threads. I'd rather discuss indexes, the bond market and the nuts and bolts of monetary policy that are being employed to offset this.

        Austrian econ dictates that we let the market take it's natural course of action.

        Neo Keynes and Neo-classical econ dictates that we get on that bailout train and engage in stimulus policy.

        The TRUTH is that spending our way out of this is going to get fucking pricey given that we're already on the hook for 10 Trillion in stimulus spending from this administration alone.

        The risk associated with the '17 stimulus is that it wouldn't leave the economy anywhere to go. We're already spending like nuts and taxes are already low AF. We've also already eased the interest rate down to 1%. And we're already giving out the really big loans. If it still collapses with this kind of crazy fucking leverage, there's not much more room to move.

        In '08 the banks fucked us, this time we fucked ourselves.

        Craziest infrastructure week yet, am I right?
        "Pave the way for the little guy, Caligula!" Harry Solomon, September 28, 1999

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          #19
          Originally posted by Dung Beatles View Post

          Again, I'd like to refrain from discussing political causation because it's kinda cross contamination with other threads. I'd rather discuss indexes, the bond market and the nuts and bolts of monetary policy that are being employed to offset this.

          Austrian econ dictates that we let the market take it's natural course of action.

          Neo Keynes and Neo-classical econ dictates that we get on that bailout train and engage in stimulus policy.

          The TRUTH is that spending our way out of this is going to get fucking pricey given that we're already on the hook for 10 Trillion in stimulus spending from this administration alone.

          The risk associated with the '17 stimulus is that it wouldn't leave the economy anywhere to go. We're already spending like nuts and taxes are already low AF. We've also already eased the interest rate down to 1%. And we're already giving out the really big loans. If it still collapses with this kind of crazy fucking leverage, there's not much more room to move.

          In '08 the banks fucked us, this time we fucked ourselves.

          Craziest infrastructure week yet, am I right?
          This is why I was astonished your fed kept interest rates so low when your economy was getting along well. That course of action hobbled an important lever that could be used for situations where economy stimulus intervention could be needed.
          Last edited by lant3rn; 3/09/2020 1:31pm, .

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            #20
            Mother of god...I just lost a big chunk of my life savings in a single day.

            #bluemonday

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              #21
              Originally posted by W. Rabbit View Post
              Mother of god...I just lost a big chunk of my life savings in a single day.

              #bluemonday
              Was it Warren Buffet who they asked about the millions that he lost when the stock market dropped and he said, I didn't lose anything, I haven't sold any of those stocks. Or something along those lines. You may be down today or up tomorrow. Play the long game and hope for the best.
              Combatives training log.

              Gezere: paraphrase from Bas Rutten, Never escalate the level of violence in fight you are losing. :D

              Drum thread

              Pavel Tsatsouline: kettlebell workouts give you “cardio without the dishonour of aerobics”.

              "Disliking someone is not evidence of wrongdoing or malfeasance or even bias." --Dung Beatles

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                #22
                Originally posted by Diesel_tke View Post

                Was it Warren Buffet who they asked about the millions that he lost when the stock market dropped and he said, I didn't lose anything, I haven't sold any of those stocks. Or something along those lines. You may be down today or up tomorrow. Play the long game and hope for the best.
                This really

                i got out of trying short term investments in 2016, when I took a little bath.

                Stocks on are sale now!!

                Comment


                  #23
                  Originally posted by Diesel_tke View Post

                  Was it Warren Buffet who they asked about the millions that he lost when the stock market dropped and he said, I didn't lose anything, I haven't sold any of those stocks. Or something along those lines. You may be down today or up tomorrow. Play the long game and hope for the best.
                  Yes, hope and prayers. The hallmark of sound investing as well as pandemic response.

                  Mrs Rabbit (who is a communications pathologist who works in the school system) just informed me that NJ is preparing for a statewide virtual lockdown, in case they close all the schools. The kids are mandated to still receive therapy, so it will have to be done remotely.

                  My mother in law is of course convinced it's all a big hoax. Can't for the life of me figure out where she got that crazy idea...


                  ​​​​​​

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                    #24
                    BTW, this is a great stock ticker.

                    http://www.stockmaster.in/dow.html
                    "Pave the way for the little guy, Caligula!" Harry Solomon, September 28, 1999

                    Comment


                      #25
                      I can't touch mine for 2 more years anyway, LOL.

                      By that time I won't need any retirement savings, because Biden will be President and I'll be drinking that free bubble-up, and eating that rainbow stew.
                      Falling for Judo since 1980

                      "You are wrong. Why? Because you move like a pregnant yak and talk like a spazzing 'I train UFC' noob." -DCS

                      "The best part of getting you worked up is your backpack full of irony and lies." -It Is Fake

                      "Banning BKR is like kicking a Quokka. It's foolishness of the first order." - Raycetpfl

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                        #26
                        Warren Buffet said today he hasn't seen anything like this market in 89 years.

                        Implying of course, that he was watching the markets on the day he was born. Probably was.

                        Either way, one has to wonder how many 1000-2000 point consecutive slides the US markets can actually suffer before the whole thing crashes down.

                        Recession? We could be on the verge of an actual depression event, if you've been watching how much of the economy is actually halting outright now. Concerts, events being cancelled, imports frozen, panicked investors, oil war with Putin.

                        Love to hear what could turn this all around at this point short of aliens showing up with the cure for COVID19 and the secrets of FTL travel.

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                          #27
                          We are now officially in a bear market.

                          All stocks are officially on sale. Index funds are the easiest and most reliable way to make longterm money in these conditions. If you personally believe a stock was under performing before, then now is a great time to watch it until the price stops falling and buy it snap it up.

                          As a general rule though, it's very hard to beat the index.

                          I watched the JRE yesterday and I gotta say his infectious disease expert guy did not paint a pleasant picture. Overflowing hospitals, lack of medical services, lack of medical supplies, lack medicine itself because it's all made in China and India... as well as his story about what's going on in Milan, Italy give me no confidence that this is going to improve fast enough to give the stock market confidence to recover.

                          In other words, I don't see these prices going back up significantly for very long until we're over the hump on the life of this virus. A good solid heatwave might help but until summer, I think it's a great time to be thankful you had time to see this coming and move things around.

                          If you have a portfolio and have taken losses already FOR GOD'S SAKE, DON'T SELL and hold on to it. You'll just lose your shirt.

                          Current DOW 23,553.22 Down 1,465 pts today... almost 6% in a single day.

                          Stimulus packages during the fallout might help but don't count on much immediate movement until the news about the virus is that it's going away and the only thing left is the crying.

                          "Pave the way for the little guy, Caligula!" Harry Solomon, September 28, 1999

                          Comment


                            #28
                            Originally posted by Dung Beatles View Post
                            We are now officially in a bear market.

                            All stocks are officially on sale. Index funds are the easiest and most reliable way to make longterm money in these conditions. If you personally believe a stock was under performing before, then now is a great time to watch it until the price stops falling and buy it snap it up.

                            As a general rule though, it's very hard to beat the index.

                            I watched the JRE yesterday and I gotta say his infectious disease expert guy did not paint a pleasant picture. Overflowing hospitals, lack of medical services, lack of medical supplies, lack medicine itself because it's all made in China and India... as well as his story about what's going on in Milan, Italy give me no confidence that this is going to improve fast enough to give the stock market confidence to recover.

                            In other words, I don't see these prices going back up significantly for very long until we're over the hump on the life of this virus. A good solid heatwave might help but until summer, I think it's a great time to be thankful you had time to see this coming and move things around.

                            If you have a portfolio and have taken losses already FOR GOD'S SAKE, DON'T SELL and hold on to it. You'll just lose your shirt.

                            Current DOW 23,553.22 Down 1,465 pts today... almost 6% in a single day.

                            Stimulus packages during the fallout might help but don't count on much immediate movement until the news about the virus is that it's going away and the only thing left is the crying.
                            Craziest part is -1,465 isn't even a record as of 48 hours ago.

                            Strange days.

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                              #29
                              This is one of those rare places I know a little about and everyone else gets to be the dumb ape for a bit. Every one of you mother fuckers are better at math than me and would probably be better than me at this too if you found it very interesting in college or read the same books that I did.

                              Originally posted by W. Rabbit View Post

                              Either way, one has to wonder how many 1000-2000 point consecutive slides the US markets can actually suffer before the whole thing crashes down.

                              Recession? We could be on the verge of an actual depression event, if you've been watching how much of the economy is actually halting outright now. Concerts, events being cancelled, imports frozen, panicked investors, oil war with Putin.

                              Love to hear what could turn this all around at this point short of aliens showing up with the cure for COVID19 and the secrets of FTL travel.
                              ​​
                              I'll respond in parts because a lot of people probably think things like this or don't know at all because econ is boring so they just sort of hold voodoo like beliefs about the economy.

                              1. The answer might shock you how much of a beating the stock market can take before the US slips into recession or depression. I don't think you understand what those terms mean though. The real fella to watch isn't the stock market, it's the bond market. That's what underwrites the entire economy. Bonds insure the whole damn thing. Money doesn't disappear when stock prices collapse. Those prices are from people selling off their investments because businesses appear less provitable. IF the entire stock market lost all of it's value down to say a value of 1 point. as in 24,000 down to just 1 fucking point then the companies that those stocks represent still wouldn't all suddenly be practically worthless. They'd just be vastly undervalued in aggregate.

                              2. There's no guarantee this will trigger a recession, much less a depression. Let's define these terms:

                              "A recession is a business cycle contraction when there is a general decline in economic activity. Recessions generally occur when there is a widespread drop in spending." What they're talking about here is the circulation of money in the economy. When money circulates slowly, IE people aren't spending it, then it's harder for businesses to make profits. So a recession is just a lull in activity. Recessions usually have an inflation problem. Prices up, dollars worth less money.

                              A depression is a sustained, severe decline in activity. The two Depressions of the 20th century in America were marked by deflation. Deflation is when prices fall and the value of the dollar goes up. That means people effectively owe more in debt and have less chance to earn enough to pay off those debts. Suddenly people begin saving their money and the lack of spending means earnings go down for everyone.


                              3. Here's where the bond market becomes so important. It is the insurance policy and represents different kinds of financial debt instruments. Debt is the key word.If enough people can't pay their debts then the bonds start to fail. If the bonds fail, banks fail. If enough banks fail then people can't get credit to work in business and the businesses fail. The bond market mostly doesn't really give a shit what the stock index funds are doing. Stock prices are volatile in comparison but bonds should be kept at stable as possible. What people should worry about is if businesses start laying people off. If big layoffs start happening, that's the sign we're in a recession. If the value of the dollar goes way up, that's a sign we're entering a depression. These things are much more global than they were in the past so if foreign economies start to tank, expect them to seek out US dollars and buy US bonds. That will help stabilize the bond market and the value of the dollar. If the dollar goes up too much, that's the worst case scenario but it's unlikely.

                              A recession looks likely, but there are no guarantees. An awful lot hinges on how well the government manages the health crisis. I am dubious about the prospect of a depression. That's a worst case scenario that's even more dangerous than the current pandemic and frankly much more terrible than people realize.
                              Last edited by Dung Beatles; 3/11/2020 9:58pm, .
                              "Pave the way for the little guy, Caligula!" Harry Solomon, September 28, 1999

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                                #30
                                Originally posted by Dung Beatles View Post

                                A depression is a sustained, severe decline in activity. The two Depressions of the 20th century in America were marked by deflation. Deflation is when prices fall and the value of the dollar goes up. That means people effectively owe more in debt and have less chance to earn enough to pay off those debts. Suddenly people begin saving their money and the lack of spending means earnings go down for everyone.


                                3. Here's where the bond market becomes so important. It the insurance policy and represents different kinds of financial debt instruments. Debt is the key word.If enough people can't pay their debts then the bonds start to fail. If the bonds fail, banks fail. If enough banks fail then people can't get credit to work in business and the businesses fail. The bond market mostly doesn't really give a shit what the stock index funds are doing. Stock prices are volatile in comparison but stocks should be kept at stable as possible. What people should worry about is if businesses start laying people off. If big layoffs start happening, that's the sign we're in a recession. If the value of the dollar goes way up, that's a sign we're entering a depression. These things are much more global than they were in the past so if foreign economies start to tank, expect them to seek out US dollars and buy US bonds. That will help stabilize the bond market and the value of the dollar. If the dollar goes up too much, that's the worst case scenario but it's unlikely.

                                A recession looks likely, but there are no guarantees. An awful lot hinges on how well the government manages the health crisis. I am dubious about the prospect of a depression. That's a worst case scenario that's even more dangerous than the current pandemic and frankly much more terrible than people realize.
                                Good post, but it spawned a follow-up.

                                If there have only been two depressions, and they are defined as you said, why so dubious?

                                Black Tuesday indicated the start of the Great Depression, followed by massive unemployment. So what's to say these massive, unprecedented slides couldn't signal something bad long term?

                                Now in 2020, a lot of people now have the option to WFH. Google just forced their entire US workforce to go remote.

                                But what happens when brick and mortar employees start losing jobs because people stay at home, shop on Amazon, etc?

                                I guess what I'm asking, what are the positive signs that I as an investor would be encouraged by. Right now we are barely getting started with global infection rates.

                                If you're good with logarithmic math I'll post my spooky graphs and we can probably start to guess what economic health is at 1,000,000 and 10,000,000 infections, because it's definitely happening, not if but when.

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