Bear Cub Smells Bubble

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TheTimeLord
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Re: Bear Cub Smells Bubble

Post by TheTimeLord »

So do people find echo chamber threads like this that reinforce their current view of the market helpful in their investing? Or is it simply reassurance that you aren't alone in your viewpoint?
Last edited by TheTimeLord on Thu Aug 27, 2020 2:24 pm, edited 1 time in total.
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knpstr
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Re: Bear Cub Smells Bubble

Post by knpstr »

asif408 wrote: Thu Aug 27, 2020 7:43 am
knpstr wrote: Thu Aug 27, 2020 6:52 am
asif408 wrote: Wed Aug 26, 2020 3:26 pm
knpstr wrote: Wed Aug 26, 2020 1:06 pm Ultimately interest rates and valuations are intertwined. And with the historic low interest rates we have today we should see historic high valuations.
Except for Europe and Japan and much of the rest of the developed world markets, where interest are as low or lower than US rates, yet valuations are 1/3 to 1/2 those of US stocks.
There are other factors.
But if nothing else changed and Europe and Japan had higher rates than they do today, their valuations would (or should) go down accordingly.

Interest rates and valuations aren't so closely related that x% interest rate must always equal $y valuation.
So what is the rationale for Japan having high double digit valuations in the 1980s when interest rates were in the 4-8% range? And interest rates in Japan have been near 0 since the mid 1990s, yet valuations were extremely high in the late 1990s and mid 2000s yet now their valuations are in the mid-teens? There is a similar story in Europe. Valuations were much higher in the 1990s and 2000s in Europe when interest rates were higher. Now Europe has lower valuations when interest rates are lower.

I'd be curious to know what the other factors are. I've seen demographics mentioned but Japan's demographic profile hasn't changed much in the last 30-40 years, their population growth rate has been falling pretty steadily since the 1960s (maybe it's the same for Europe, not as familiar with Europe's history). Seems to me the US is the outlier and there aren't any compelling reasons why lower interest rates should justify higher valuations.
I believe in 1980s Japan was undergoing tremendous growth. That would explain high valuations. And if the rates were lower than 4-8% the valuations would have been even higher.

I think you know valuation is complex and inexact, especially of entire economies. All I'm saying is rates affect valuations, they aren't the only thing that affect valuations. This is nothing new that I just came up with, it is a fundamental concept.
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alluringreality
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Re: Bear Cub Smells Bubble

Post by alluringreality »

TheTimeLord wrote: Thu Aug 27, 2020 1:35 pm So do people find echo chambers threads like this that reinforce their current view of the market helpful in their investing? Or is it simply reassurance that you aren't alone in your viewpoint?
I generally consider discussion on this forum potentially counterproductive opinion that may not align with my intentions. Regardless if someone has higher or lower risk tolerances than my own, or alternate considerations, from time to time there are comments I find interesting and worth reading about elsewhere. My takeaways reading threads with various viewpoints on this forum usually relates to personally unfamiliar topics, such as the put option discussion within this thread. Basically I figure that I'm the only person that needs to be okay with my investing decisions.
Targets: 15% I Bonds, 15% EE Bonds, 45% US Stock (Mid & Small Tilt), 25% Ex-US Stock (Small Tilt)
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dogagility
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Re: Bear Cub Smells Bubble

Post by dogagility »

Robot Monster wrote: Thu Aug 27, 2020 11:56 am Cramer says he and hedge fund billionaire David Tepper are confused by the market’s recent rally
https://www.cnbc.com/2020/04/08/cramer- ... rally.html
I think Cramer is confused about all things related to investing!

Knows how to speak loudly... so there's that...
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000
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Re: Bear Cub Smells Bubble

Post by 000 »

not4me wrote: Thu Aug 27, 2020 5:43 am It strikes me that you see 'optimism' in stocks because prices are high, but 'pessimism' in bonds because prices are high (although you chose to quote yield instead of price). I think they're sending similar messages about the future.
I agree with you from a valuation perspective, not a sentiment perspective. I don't see much optimism in fixed income investors.
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Re: Bear Cub Smells Bubble

Post by 000 »

CyclingDuo wrote: Thu Aug 27, 2020 7:14 am Just curious why you joined and what your particular goals were for joining in terms of your investing?
Stinky wrote: Thu Aug 27, 2020 8:06 am Yes. And, “000”, what were you doing with your free time before you joined this Forum?
Joined during covid work lull / staycation to post helpful comments.
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Re: Bear Cub Smells Bubble

Post by 000 »

To those suggesting that I am fearful or that I should time and/or short the market, you are missing the point.

As I stated in my very second post in this thread:
000 wrote: Wed Aug 26, 2020 3:13 pm I will note that nothing in my OP discusses market timing or -- shudder -- shorting the market. I suppose one might choose to do those things in response to a bubble, but one might also choose to get, or stay, diversified across asset classes, geography, and/or factors.
JackoC
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Re: Bear Cub Smells Bubble

Post by JackoC »

anoop wrote: Thu Aug 27, 2020 12:02 pm "Amid all the cheerleading it may be worth pointing out that aggregate corporate profits have gone nowhere in the past 8 years. Markets keep playing multiple expansion driven by central bank liquidity & illusory EPS growth manufactured by shrinking float due to buybacks."

https://twitter.com/NorthmanTrader/stat ... 3335341056
There's obviously multiple expansion. In Aug 2012 the S&P CAPE was 21.4 now it's 30.6. The problem there as always is determining what the 'right' ratio is. There's no law of nature saying it has to 'revert' to any given mean of a past historical period. However all else equal a lower earnings yield (expressed as 1/CAPE in this case) means a proportionally lower expected return with basic and not entirely unrealistic assumptions of Corporate Finance 101.

But, S&P EPS has also grown faster than National Income Product Accounts (NIPA) the Fred graph the Twitter guy (never heard of him, should I have? :happy ) points to. Here's a paper by AQR from last year addressing possible reasons S&P earnings have outpaced NIPA in recent years. They are not the same thing, IOW the Fred graph is not of S&P or public companies but all ~5 million corporate tax returns and the methodology is not the same either. Buybacks likely have nothing directly to do with it, but several other things might. It is viewed as negative indicator by some when S&P earnings outpaces NIPA, it happened before the 2002 drop also. But like most things, not conclusive or questions like this would be a lot easier, and it would be clearly worth trying to guess if the market is 'overvalued'. As things stand, it's not clear that that is worth it other than a topic to shoot the breeze about to kill a little time.
https://www.aqr.com/Insights/Research/M ... nings-GAAP

And one could also diversify somewhat to lower valued stock markets outside the US. Good reasons might entirely explain those valuation differences. Or not, again if one has a special talent for determining this they really ought to consider getting hired to do it with other people's money, I'm being serious. But anyway, even if the reasons US market is more highly valued are 100% 'correct' now, things may change. That's why we diversify generally rather than keeping all our money on yesterday's winners. But if already reasonably diversified, then I think much more difficult to come up with anything actionable out of 'it smells like a bubble'. Though I also thing indexes like PutWrite are interesting to consider, in general, not specifically in respect of valuations or 'bubbles'.
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Re: Bear Cub Smells Bubble

Post by CyclingDuo »

anoop wrote: Thu Aug 27, 2020 12:02 pm "Amid all the cheerleading it may be worth pointing out that aggregate corporate profits have gone nowhere in the past 8 years. Markets keep playing multiple expansion driven by central bank liquidity & illusory EPS growth manufactured by shrinking float due to buybacks."

https://twitter.com/NorthmanTrader/stat ... 3335341056
No - don't pull out the mustached tea leaf reading perma-bear!!! :oops:

Check his historic record at Larry Swedroe's tracking of gurus predictions. Or other sources of recent...

WRONG! If there is one thing that Sven Henrich knows how to do consistently and with inserted caveats narrated for the sake of those known consistent failed forecasts and analysis, it’s WRONG! But of course we emphasize WRONG with consistency.

We have chronicled the failed forecasting and analysis of the Northman Trader over the years; the early 2019 failed forecast also comes to mind. In this analytical piece published by MarketWatch in March 2019, the offering once again stokes fear by attempting to chart, yes chart the VIX. One more time if you’re not paying attention, chart/technical analysis the VIX. This is a no-no folks!

https://www.finomgroup.com/failed-forec ... -of-sorts/

Sven is a true example of financial porn. Turn it off and move on with your life.

CyclingDuo
"Save like a pessimist, invest like an optimist." - Morgan Housel
anoop
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Re: Bear Cub Smells Bubble

Post by anoop »

CyclingDuo wrote: Thu Aug 27, 2020 5:54 pm
anoop wrote: Thu Aug 27, 2020 12:02 pm "Amid all the cheerleading it may be worth pointing out that aggregate corporate profits have gone nowhere in the past 8 years. Markets keep playing multiple expansion driven by central bank liquidity & illusory EPS growth manufactured by shrinking float due to buybacks."

https://twitter.com/NorthmanTrader/stat ... 3335341056
No - don't pull out the mustached tea leaf reading perma-bear!!! :oops:

Check his historic record at Larry Swedroe's tracking of gurus predictions. Or other sources of recent...

WRONG! If there is one thing that Sven Henrich knows how to do consistently and with inserted caveats narrated for the sake of those known consistent failed forecasts and analysis, it’s WRONG! But of course we emphasize WRONG with consistency.

We have chronicled the failed forecasting and analysis of the Northman Trader over the years; the early 2019 failed forecast also comes to mind. In this analytical piece published by MarketWatch in March 2019, the offering once again stokes fear by attempting to chart, yes chart the VIX. One more time if you’re not paying attention, chart/technical analysis the VIX. This is a no-no folks!

https://www.finomgroup.com/failed-forec ... -of-sorts/

Sven is a true example of financial porn. Turn it off and move on with your life.

CyclingDuo
His observations are 100% correct.
His predictions are 100% wrong.

He does not realize that his observations are worthless, as is 100% of all other economic analysis that folks may be doing here, because all that matters is DNFTF.
LakerP
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Re: Bear Cub Smells Bubble

Post by LakerP »

Just would like to point out that Vanguards most recent fair value CAPE model indicates US equities being fairly valued while international being almost undervalued. This is essentially Robert Shiller's CAPE model and is based on the market as of June 31st, 2020. I think I would rather trust the expert on bubbles and his evidence based model rather than my feelings about the market. Image
tiburblium
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Re: Bear Cub Smells Bubble

Post by tiburblium »

Options bets that the stock market will continue to soar have exploded to dot-com bubble levels:

https://www.marketwatch.com/story/optio ... 1598558379
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Re: Bear Cub Smells Bubble

Post by Grt2bOutdoors »

rockstar wrote: Wed Aug 26, 2020 8:09 pm
000 wrote: Wed Aug 26, 2020 8:06 pm
rockstar wrote: Wed Aug 26, 2020 8:02 pm Let's say we're in a bubble. People will have to be motivated to sell for it to pop. And they'll need somewhere else to put their money. Where would they put it?
They can move it to non-tech stocks.
Also, a lot of "their money" will just evaporate as the share price decreases because the price is set by a single transaction.
But why would they sell?
It will only take 1 or 2 companies in the frothy growth arena to show an earnings estimate miss, reduction in revenues growth, decline in margins, opening up of work offices with actual staff returning, and the air will come rushing out of froth into value companies who benefit from the renewed demand for aghast! gasoline and oil, industrial products, etc.
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Re: Bear Cub Smells Bubble

Post by Grt2bOutdoors »

LakerP wrote: Thu Aug 27, 2020 6:39 pm Just would like to point out that Vanguards most recent fair value CAPE model indicates US equities being fairly valued while international being almost undervalued. This is essentially Robert Shiller's CAPE model and is based on the market as of June 31st, 2020. I think I would rather trust the expert on bubbles and his evidence based model rather than my feelings about the market. Image
Fake news, there is no such thing as June 31st! There you have it. Continue on with the party, please pass the punch bowl! :twisted:
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
burritoLover
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Re: Bear Cub Smells Bubble

Post by burritoLover »

LakerP wrote: Thu Aug 27, 2020 6:39 pm Just would like to point out that Vanguards most recent fair value CAPE model indicates US equities being fairly valued while international being almost undervalued. This is essentially Robert Shiller's CAPE model and is based on the market as of June 31st, 2020. I think I would rather trust the expert on bubbles and his evidence based model rather than my feelings about the market.
This reeks of fitting data to their pre-conceived notion. Since CAPE hasn’t reverted to the pre-2000 mean, they are just going to invent a new model just for this period and rubber stamp the U.S. market as fairly valued.
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BradJ
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Re: Bear Cub Smells Bubble

Post by BradJ »

000 wrote: Wed Aug 26, 2020 12:00 am 1. Tech stocks are priced to perfection. TSLA, AAPL come to mind.
2. 100% stock portfolios are all the rage. Bonds are bad. Cash is trash. Gold is gross.
3. The mainstream is pushing TINA (There Is No Alternative to stocks) as well.
4. Almost everyone is either euphoric about stocks or has succumbed to TINA.
5. Berkshire Hathaway has succumbed to holding huge portions of AAPL.
6. People who would never have owned (as much in) stocks in the past are piling in.
7. Some are day trading their stimulus checks or student loans.
8. Some are leaving good jobs in their 30s to live off stocks passively for 50+ years.
9. I have seen discussions about the stock market in non-investment contexts.

Are stocks in a bubble? Or have they reached a permanently high plateau? Or do I need a dose of optimism? :mrgreen:
How common is #8? FIRE stories make the headlines because they are rare.
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Re: Bear Cub Smells Bubble

Post by 000 »

BradJ wrote: Thu Aug 27, 2020 10:15 pm
000 wrote: Wed Aug 26, 2020 12:00 am 1. Tech stocks are priced to perfection. TSLA, AAPL come to mind.
2. 100% stock portfolios are all the rage. Bonds are bad. Cash is trash. Gold is gross.
3. The mainstream is pushing TINA (There Is No Alternative to stocks) as well.
4. Almost everyone is either euphoric about stocks or has succumbed to TINA.
5. Berkshire Hathaway has succumbed to holding huge portions of AAPL.
6. People who would never have owned (as much in) stocks in the past are piling in.
7. Some are day trading their stimulus checks or student loans.
8. Some are leaving good jobs in their 30s to live off stocks passively for 50+ years.
9. I have seen discussions about the stock market in non-investment contexts.

Are stocks in a bubble? Or have they reached a permanently high plateau? Or do I need a dose of optimism? :mrgreen:
How common is #8? FIRE stories make the headlines because they are rare.
Fairly uncommon in the real world. But the stock market doesn't move based on what ordinary workers are doing. It moves based on what (especially active) investors are doing. Recently, in Bogleheads land, there have been many threads about #8.
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Re: Bear Cub Smells Bubble

Post by cogito »

One of the things that has stuck with me from reading George Soros' Alchemy of Finance has been his assertion that if you can identify a bubble, you buy, not sell.
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Re: Bear Cub Smells Bubble

Post by 000 »

cogito wrote: Thu Aug 27, 2020 10:24 pm One of the things that has stuck with me from reading George Soros' Alchemy of Finance has been his assertion that if you can identify a bubble, you buy, not sell.
Buy and _____?

Hold?
Time the sell?
langlands
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Re: Bear Cub Smells Bubble

Post by langlands »

000 wrote: Thu Aug 27, 2020 10:37 pm
cogito wrote: Thu Aug 27, 2020 10:24 pm One of the things that has stuck with me from reading George Soros' Alchemy of Finance has been his assertion that if you can identify a bubble, you buy, not sell.
Buy and _____?

Hold?
Time the sell?
Stop loss is a possibility. Bet that the thing will skyrocket off euphoria before it drops 20%-30%.
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000
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Re: Bear Cub Smells Bubble

Post by 000 »

langlands wrote: Thu Aug 27, 2020 10:46 pm
000 wrote: Thu Aug 27, 2020 10:37 pm
cogito wrote: Thu Aug 27, 2020 10:24 pm One of the things that has stuck with me from reading George Soros' Alchemy of Finance has been his assertion that if you can identify a bubble, you buy, not sell.
Buy and _____?

Hold?
Time the sell?
Stop loss is a possibility. Bet that the thing will skyrocket off euphoria before it drops 20%-30%.
I've always been skeptical of stops.

The more "protection" the stop offers (closer the stop price is to my purchase price), the more likely it is to be triggered due to ordinary volatility.

There is no protection against an overnight gap down, or maybe even an intraday gap depending on liquidity.

Your thoughts?
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TheTimeLord
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Re: Bear Cub Smells Bubble

Post by TheTimeLord »

000 wrote: Thu Aug 27, 2020 11:14 pm
langlands wrote: Thu Aug 27, 2020 10:46 pm
000 wrote: Thu Aug 27, 2020 10:37 pm
cogito wrote: Thu Aug 27, 2020 10:24 pm One of the things that has stuck with me from reading George Soros' Alchemy of Finance has been his assertion that if you can identify a bubble, you buy, not sell.
Buy and _____?

Hold?
Time the sell?
Stop loss is a possibility. Bet that the thing will skyrocket off euphoria before it drops 20%-30%.
I've always been skeptical of stops.

The more "protection" the stop offers (closer the stop price is to my purchase price), the more likely it is to be triggered due to ordinary volatility.

There is no protection against an overnight gap down, or maybe even an intraday gap depending on liquidity.

Your thoughts?
Life is full of risk.
IMHO, Investing should be about living the life you want, not avoiding the life you fear. | Run, You Clever Boy! [9085]
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000
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Re: Bear Cub Smells Bubble

Post by 000 »

TheTimeLord wrote: Thu Aug 27, 2020 11:15 pm
000 wrote: Thu Aug 27, 2020 11:14 pm
langlands wrote: Thu Aug 27, 2020 10:46 pm
000 wrote: Thu Aug 27, 2020 10:37 pm
cogito wrote: Thu Aug 27, 2020 10:24 pm One of the things that has stuck with me from reading George Soros' Alchemy of Finance has been his assertion that if you can identify a bubble, you buy, not sell.
Buy and _____?

Hold?
Time the sell?
Stop loss is a possibility. Bet that the thing will skyrocket off euphoria before it drops 20%-30%.
I've always been skeptical of stops.

The more "protection" the stop offers (closer the stop price is to my purchase price), the more likely it is to be triggered due to ordinary volatility.

There is no protection against an overnight gap down, or maybe even an intraday gap depending on liquidity.

Your thoughts?
Life is full of risk.
Yes. But why are stops the right strategy to control an active trader's risk? e.g. versus buying puts, or just not investing in the bubbly stock.
langlands
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Re: Bear Cub Smells Bubble

Post by langlands »

000 wrote: Thu Aug 27, 2020 11:14 pm
langlands wrote: Thu Aug 27, 2020 10:46 pm
000 wrote: Thu Aug 27, 2020 10:37 pm
cogito wrote: Thu Aug 27, 2020 10:24 pm One of the things that has stuck with me from reading George Soros' Alchemy of Finance has been his assertion that if you can identify a bubble, you buy, not sell.
Buy and _____?

Hold?
Time the sell?
Stop loss is a possibility. Bet that the thing will skyrocket off euphoria before it drops 20%-30%.
I've always been skeptical of stops.

The more "protection" the stop offers (closer the stop price is to my purchase price), the more likely it is to be triggered due to ordinary volatility.

There is no protection against an overnight gap down, or maybe even an intraday gap depending on liquidity.

Your thoughts?
If liquidity is a concern, you can always do it manually (decide whether to sell at market open next day depending on what happened the day before). I'm thinking of more "vanilla" bubbles like TSLA, bitcoin, and the like (assuming you think they're bubbles) where the market is pretty liquid and you don't need to worry about abnormal "non-economic" market movements stopping you out. Presumably if TSLA gaps down by 20%, the party's over and you would want to sell. Basically, the stop loss acts as both a protection and an indicator for when you want to sell.
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000
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Re: Bear Cub Smells Bubble

Post by 000 »

langlands wrote: Thu Aug 27, 2020 11:21 pm If liquidity is a concern, you can always do it manually (decide whether to sell at market open next day depending on what happened the day before). I'm thinking of more "vanilla" bubbles like TSLA, bitcoin, and the like (assuming you think they're bubbles) where the market is pretty liquid and you don't need to worry about abnormal "non-economic" market movements stopping you out. Presumably if TSLA gaps down by 20%, the party's over and you would want to sell. Basically, the stop loss acts as both a protection and an indicator for when you want to sell.
[emphasis mine]

Thanks. I guess the stop can be used to force to sell at a small loss rather than a large one. So maybe there is a psychological benefit.
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TheTimeLord
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Re: Bear Cub Smells Bubble

Post by TheTimeLord »

000 wrote: Thu Aug 27, 2020 11:20 pm
TheTimeLord wrote: Thu Aug 27, 2020 11:15 pm
000 wrote: Thu Aug 27, 2020 11:14 pm
langlands wrote: Thu Aug 27, 2020 10:46 pm
000 wrote: Thu Aug 27, 2020 10:37 pm

Buy and _____?

Hold?
Time the sell?
Stop loss is a possibility. Bet that the thing will skyrocket off euphoria before it drops 20%-30%.
I've always been skeptical of stops.

The more "protection" the stop offers (closer the stop price is to my purchase price), the more likely it is to be triggered due to ordinary volatility.

There is no protection against an overnight gap down, or maybe even an intraday gap depending on liquidity.

Your thoughts?
Life is full of risk.
Yes. But why are stops the right strategy to control an active trader's risk? e.g. versus buying puts, or just not investing in the bubbly stock.
You make lots of assumptions about things.

https://www.investopedia.com/articles/a ... orders.asp
IMHO, Investing should be about living the life you want, not avoiding the life you fear. | Run, You Clever Boy! [9085]
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000
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Re: Bear Cub Smells Bubble

Post by 000 »

TheTimeLord wrote: Thu Aug 27, 2020 11:35 pm
000 wrote: Thu Aug 27, 2020 11:20 pm
TheTimeLord wrote: Thu Aug 27, 2020 11:15 pm
Life is full of risk.
Yes. But why are stops the right strategy to control an active trader's risk? e.g. versus buying puts, or just not investing in the bubbly stock.
You make lots of assumptions about things.

https://www.investopedia.com/articles/a ... orders.asp
Not sure what assumptions I am making or how the article is relevant.

If I place a stop limit sell order and the underlying gaps beneath my limit price, I will be stuck with the underlying...
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Re: Bear Cub Smells Bubble

Post by finite_difference »

anoop wrote: Thu Aug 27, 2020 9:13 am
Ramjet wrote: Thu Aug 27, 2020 8:20 am
Steve Reading wrote: Wed Aug 26, 2020 2:26 pm
knpstr wrote: Wed Aug 26, 2020 1:06 pm Ultimately interest rates and valuations are intertwined. And with the historic low interest rates we have today we should see historic high valuations.
Literally this +10000.
100% agree, we better get used to high valuations
May be you guys mean “get used to ever higher valuations”, because we are about to see Apple at $10T with substantially similar earnings to what they have now.
That would require Apple’s stock price to go up 5x, which if their earnings stay the same would be a PE ratio of 165? I don’t think we’re “about to see” that anytime soon.

Tesla’s market cap is $0.4T. I’d say Apple’s a pretty good deal by comparison.
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh
anoop
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Re: Bear Cub Smells Bubble

Post by anoop »

finite_difference wrote: Fri Aug 28, 2020 12:20 am
anoop wrote: Thu Aug 27, 2020 9:13 am
Ramjet wrote: Thu Aug 27, 2020 8:20 am
Steve Reading wrote: Wed Aug 26, 2020 2:26 pm
knpstr wrote: Wed Aug 26, 2020 1:06 pm Ultimately interest rates and valuations are intertwined. And with the historic low interest rates we have today we should see historic high valuations.
Literally this +10000.
100% agree, we better get used to high valuations
May be you guys mean “get used to ever higher valuations”, because we are about to see Apple at $10T with substantially similar earnings to what they have now.
That would require Apple’s stock price to go up 5x, which if their earnings stay the same would be a PE ratio of 165? I don’t think we’re “about to see” that anytime soon.

Tesla’s market cap is $0.4T. I’d say Apple’s a pretty good deal by comparison.
Apple will be buying back 10's of billions in stock so that will slightly lower the effective PE.

If Amazon can have a PE of 1000 (which it will by then), Apple's PE at 165 will look tame.

I predict we will see Apple's market cap hit $10T within 2 years. During that time, I expect the S&P500 to hit 7000 and the Nasdaq to hit 25,000.

You can also safely put money in long bonds, since every 2 years the rate will halve generating handsome capital gains forever. This is a Moore's law of sorts, except that there are no limitations imposed by physics. So even if the 30 year yield is 10^-10, if 2 years later the yield is 0.5 * 10^-10, you suddenly have huge capital gains on the one with the 10^-10 yield. No need for negative yields.

Just don't leave your money in cash like I have done for the last 10 years. I have learned my lesson well. DNFTF.

This is the ONLY way that pension funds can survive.

(I do have some history of correct predictions. As the market was tanking earlier this year, I predicted we would see new highs before the year was out.)
anoop
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Re: Bear Cub Smells Bubble

Post by anoop »

000 wrote: Thu Aug 27, 2020 11:14 pm
langlands wrote: Thu Aug 27, 2020 10:46 pm
000 wrote: Thu Aug 27, 2020 10:37 pm
cogito wrote: Thu Aug 27, 2020 10:24 pm One of the things that has stuck with me from reading George Soros' Alchemy of Finance has been his assertion that if you can identify a bubble, you buy, not sell.
Buy and _____?

Hold?
Time the sell?
Stop loss is a possibility. Bet that the thing will skyrocket off euphoria before it drops 20%-30%.
I've always been skeptical of stops.

The more "protection" the stop offers (closer the stop price is to my purchase price), the more likely it is to be triggered due to ordinary volatility.

There is no protection against an overnight gap down, or maybe even an intraday gap depending on liquidity.

Your thoughts?
Stops are what all the financial pundits on CNN/CNBC/YouTube/etc. talk about. If it worked, they wouldn't be pundits on noisy morning TV shows and making videos on YouTube or writing books about how to invest. They'd be billionaires on yachts.
not4me
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Re: Bear Cub Smells Bubble

Post by not4me »

000 wrote: Thu Aug 27, 2020 4:55 pm
not4me wrote: Thu Aug 27, 2020 5:43 am It strikes me that you see 'optimism' in stocks because prices are high, but 'pessimism' in bonds because prices are high (although you chose to quote yield instead of price). I think they're sending similar messages about the future.
I agree with you from a valuation perspective, not a sentiment perspective. I don't see much optimism in fixed income investors.
Interesting -- this helped me get the disconnect I had. Previously, I had interpreted your mention of sentiment as looking objectively at sentiment as expressed by their action in the market. I think now you are saying you use a subjective approach regarding how they felt when they took those actions (or possibly refrained from action?)? I would be interested in understanding more about how you go about that and/or how I missed the point again. Also, do you weight somehow between investors? For example, Fed laid things out yesterday & granted it is being interpreted in multiple ways, but seemed clear & timely enough for me. Are you reading their sentiment into their plans? Does it carry same/more/less weight that others such as posts on this forum? Serious questions. Not 1st time 2 have looked at same scenario & one seen danger and another opportunity.
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CyclingDuo
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Re: Bear Cub Smells Bubble

Post by CyclingDuo »

000 wrote: Thu Aug 27, 2020 10:19 pm
BradJ wrote: Thu Aug 27, 2020 10:15 pm
000 wrote: Wed Aug 26, 2020 12:00 am 1. Tech stocks are priced to perfection. TSLA, AAPL come to mind.
2. 100% stock portfolios are all the rage. Bonds are bad. Cash is trash. Gold is gross.
3. The mainstream is pushing TINA (There Is No Alternative to stocks) as well.
4. Almost everyone is either euphoric about stocks or has succumbed to TINA.
5. Berkshire Hathaway has succumbed to holding huge portions of AAPL.
6. People who would never have owned (as much in) stocks in the past are piling in.
7. Some are day trading their stimulus checks or student loans.
8. Some are leaving good jobs in their 30s to live off stocks passively for 50+ years.
9. I have seen discussions about the stock market in non-investment contexts.

Are stocks in a bubble? Or have they reached a permanently high plateau? Or do I need a dose of optimism? :mrgreen:
How common is #8? FIRE stories make the headlines because they are rare.
Fairly uncommon in the real world. But the stock market doesn't move based on what ordinary workers are doing. It moves based on what (especially active) investors are doing. Recently, in Bogleheads land, there have been many threads about #8.
Since you have time, do a search and post up the links to the threads to substantiate the number of "many threads "regarding those who have posted about retiring in their 30's to live off of stocks passively for 50+ years. I remember there was a thread last year about retiring in one's 30's.

I posted a reply or two, based on the 2019 book Quit Like a Millionaire about a Canadian couple that retired in 2015 in their early 30's with a $1M portfolio divided up 60/40 using a yield shield, and they have been traveling the world living on only $40K a year.

https://www.theguardian.com/lifeandstyl ... leung-fire

Anyway, I would be curious to see what you come up with in terms of the many threads focused on #8. Pro tip: I'm guessing you'll find many more threads regarding retiring in your 50's. :mrgreen:

CyclingDuo
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texasfight
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Re: Bear Cub Smells Bubble

Post by texasfight »

anoop wrote: Fri Aug 28, 2020 12:45 am
finite_difference wrote: Fri Aug 28, 2020 12:20 am
anoop wrote: Thu Aug 27, 2020 9:13 am
Ramjet wrote: Thu Aug 27, 2020 8:20 am
Steve Reading wrote: Wed Aug 26, 2020 2:26 pm

Literally this +10000.
100% agree, we better get used to high valuations
May be you guys mean “get used to ever higher valuations”, because we are about to see Apple at $10T with substantially similar earnings to what they have now.
That would require Apple’s stock price to go up 5x, which if their earnings stay the same would be a PE ratio of 165? I don’t think we’re “about to see” that anytime soon.

Tesla’s market cap is $0.4T. I’d say Apple’s a pretty good deal by comparison.
Apple will be buying back 10's of billions in stock so that will slightly lower the effective PE.

If Amazon can have a PE of 1000 (which it will by then), Apple's PE at 165 will look tame.

I predict we will see Apple's market cap hit $10T within 2 years. During that time, I expect the S&P500 to hit 7000 and the Nasdaq to hit 25,000.

You can also safely put money in long bonds, since every 2 years the rate will halve generating handsome capital gains forever. This is a Moore's law of sorts, except that there are no limitations imposed by physics. So even if the 30 year yield is 10^-10, if 2 years later the yield is 0.5 * 10^-10, you suddenly have huge capital gains on the one with the 10^-10 yield. No need for negative yields.

Just don't leave your money in cash like I have done for the last 10 years. I have learned my lesson well. DNFTF.

This is the ONLY way that pension funds can survive.

(I do have some history of correct predictions. As the market was tanking earlier this year, I predicted we would see new highs before the year was out.)
Anoon gets its. It is all one trade, a massive expanding duration bubble. Lower real rates to push up all asset values.

If you miss out again you will be eating cat food when you retire with the CD and value investors.
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Re: Bear Cub Smells Bubble

Post by texasfight »

The difference between now and the 2000 tech bubble is all in real yields (there is no alternative now, and at a negative long term real yield a stock like Apple could effectively be worth infinity). Not to mention the fact that the Fed wants to blow an asset bubble right now to avoid a deflationary collapse.

per BOA:

"CBs fuelling asset price inflation to attempt using wealth effect to reduce unemployment and "trickle down" inflation to Main st...at some point we will see gold at 3k, Apple $3 trillion, 300 bps HY bond spreads which will cause yields to pop higher, but unlike 1999 no Fed tightening in 2020."
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Re: Bear Cub Smells Bubble

Post by HomerJ »

texasfight wrote: Fri Aug 28, 2020 12:06 pm Anoon gets its. It is all one trade, a massive expanding duration bubble. Lower real rates to push up all asset values.

If you miss out again you will be eating cat food when you retire with the CD and value investors.
(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
A Goldman Sachs associate provided a variety of detailed explanations, but then offered a caveat, “If I’m being dead-### honest, though, nobody knows what’s really going on.”
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Re: Bear Cub Smells Bubble

Post by anoop »

HomerJ wrote: Fri Aug 28, 2020 4:03 pm
texasfight wrote: Fri Aug 28, 2020 12:06 pm Anoon gets its. It is all one trade, a massive expanding duration bubble. Lower real rates to push up all asset values.

If you miss out again you will be eating cat food when you retire with the CD and value investors.
(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
I don't know but to me it looks like you think the probability of a crash is 50%, which is far from "almost certain".
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Re: Bear Cub Smells Bubble

Post by CyclingDuo »

HomerJ wrote: Fri Aug 28, 2020 4:03 pm
texasfight wrote: Fri Aug 28, 2020 12:06 pm Anoon gets its. It is all one trade, a massive expanding duration bubble. Lower real rates to push up all asset values.

If you miss out again you will be eating cat food when you retire with the CD and value investors.
(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
A drawdown would totally be the norm, be it -2%, -4%, -5%, -7% or even -10% or more, etc... without changing the longer term trajectory when looking out over the next few years, and it wouldn't even violate the bull market off the March 23rd lows. We had our 30%+ decline that happens every 5 years or so in February/March. In terms of another intra-year drawdown this year, there is always room for such a drawdown, regrouping, and return to the trend which is all part of the risk/reward scenario investors must to be willing to endure in order to capture the longer term returns.

Even going back to 2009, there was a -16% drawdown in 2011, another -9.8% in 2011, a -9.9% and a -7.7% drawdown in 2012, -5.8% in 2013 drawdown, a -5.8% and a - 7.4% in 2014, a -12.4% in 2015, a -13.3% drawdown at the end of 2015 and going into 2016, a -10.2% drawdown in early 2018 and a -19.8% in late 2018, and a -6.8% in 2019 drawdown.
https://www.yardeni.com/pub/sp500corrbear.pdf

Image

At some point, we will indeed have an intra-year drawdown in the midst of this bull.

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000
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Re: Bear Cub Smells Bubble

Post by 000 »

not4me wrote: Fri Aug 28, 2020 7:12 am Interesting -- this helped me get the disconnect I had. Previously, I had interpreted your mention of sentiment as looking objectively at sentiment as expressed by their action in the market. I think now you are saying you use a subjective approach regarding how they felt when they took those actions (or possibly refrained from action?)?
That is correct.
not4me wrote: Fri Aug 28, 2020 7:12 am I would be interested in understanding more about how you go about that and/or how I missed the point again. Also, do you weight somehow between investors? For example, Fed laid things out yesterday & granted it is being interpreted in multiple ways, but seemed clear & timely enough for me. Are you reading their sentiment into their plans? Does it carry same/more/less weight that others such as posts on this forum? Serious questions. Not 1st time 2 have looked at same scenario & one seen danger and another opportunity.
These are interesting questions. I do not trade on sentiment as part of my regular investment program, so I don't have a systematic approach. I pay attention only to look out for major warning signs. It's like weather forecasts: the vast majority of the time, they are fluff that don't require any specific response from me; but when the forecast says fire tornadoes are coming to my county, I perk up, even though I don't have a specific plan laid out for dealing with fire tornadoes.

I'm not sure about the particular weighing of various sentiments, but I will say that almost anything the Fed publicly announces is non-actionable for me. By the time I see it, the opportunity is gone. The space is simply too crowded with too many eyes. On the other hand, comments from randoms online can be quite informative as they tend to be less veiled than the stuff said by Fed chairmen, analysts employed by banks, etc. and have less exposure. In fact, both for investing and non-investing analysis, I have found that the most underappreciated comments (locked topics, hidden comments) have the greatest potential to show me useful information.
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HomerJ
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Re: Bear Cub Smells Bubble

Post by HomerJ »

anoop wrote: Fri Aug 28, 2020 4:18 pm
HomerJ wrote: Fri Aug 28, 2020 4:03 pm
texasfight wrote: Fri Aug 28, 2020 12:06 pm Anoon gets its. It is all one trade, a massive expanding duration bubble. Lower real rates to push up all asset values.

If you miss out again you will be eating cat food when you retire with the CD and value investors.
(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
I don't know but to me it looks like you think the probability of a crash is 50%, which is far from "almost certain".
I almost certain ALL predictions are wrong.

50/50 covers me no matter what..

Hey, 7000 SP500 sounds awesome... Seriously... double my stock money in 2 years? European cruises for everyone in my family.

But 50% in bonds means if you're wrong (and you probably are), means I'll retire in 3-4 years anyway.

The point is I don't need 100% of my money in stocks... 50% makes me plenty rich.

You guys go all in... but if you're wrong it will cost ya. Me, everything is good either way.

Yes, you can sleep at night thinking you're 100% right, but I've been around a long time, and there's no such thing as 100% right, and since I'm aware of reality, I need 50/50 to sleep at night.
Last edited by HomerJ on Fri Aug 28, 2020 5:11 pm, edited 1 time in total.
A Goldman Sachs associate provided a variety of detailed explanations, but then offered a caveat, “If I’m being dead-### honest, though, nobody knows what’s really going on.”
marcopolo
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Re: Bear Cub Smells Bubble

Post by marcopolo »

anoop wrote: Fri Aug 28, 2020 4:18 pm
HomerJ wrote: Fri Aug 28, 2020 4:03 pm
texasfight wrote: Fri Aug 28, 2020 12:06 pm Anoon gets its. It is all one trade, a massive expanding duration bubble. Lower real rates to push up all asset values.

If you miss out again you will be eating cat food when you retire with the CD and value investors.
(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
I don't know but to me it looks like you think the probability of a crash is 50%, which is far from "almost certain".
I can't quite understand what you are trying to say.
You said recently that you got out of the market in Feb 2008 and never got back in.

You also seem to be predicting some astronomical growth in the next couple years (Apple at $10T). Texasfight who thinks you "get it" seems to be saying you better get on this ride up. You seem content to sit on the side line, presumably waiting for the crash you believe is just around the corner. It seems you have been waiting for that for some time. I am sure you will eventually be right. The tough question is will that make up for all the lost opportunity along the way.
Once in a while you get shown the light, in the strangest of places if you look at it right.
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Re: Bear Cub Smells Bubble

Post by anoop »

marcopolo wrote: Fri Aug 28, 2020 5:08 pm
anoop wrote: Fri Aug 28, 2020 4:18 pm
HomerJ wrote: Fri Aug 28, 2020 4:03 pm
texasfight wrote: Fri Aug 28, 2020 12:06 pm Anoon gets its. It is all one trade, a massive expanding duration bubble. Lower real rates to push up all asset values.

If you miss out again you will be eating cat food when you retire with the CD and value investors.
(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
I don't know but to me it looks like you think the probability of a crash is 50%, which is far from "almost certain".
I can't quite understand what you are trying to say.
You said recently that you got out of the market in Feb 2008 and never got back in.

You also seem to be predicting some astronomical growth in the next couple years (Apple at $10T). Texasfight who thinks you "get it" seems to be saying you better get on this ride up. You seem content to sit on the side line, presumably waiting for the crash you believe is just around the corner. It seems you have been waiting for that for some time. I am sure you will eventually be right. The tough question is will that make up for all the lost opportunity along the way.
Glad you are keeping track. :)

I have changed my stance and I'm getting into the market.

I have bought AAPL, FB, ZM and together they have already made me more than my INTC holdings from 2015 (which I have liquidated because of the 7 nm fiasco, so much for a forever stock). My plan right now is to load up slowly on selections from FANGMANZ. This is for taxable. I don't think I will ever get to more than 50%. I'm not looking for a home run, so if they appreciate enough (e.g. say 30-40%), I may start to liquidate, wait for a correction and then get back in again. I figure might as well play a little bit. Some might find it stressful, but I am enjoying it. If you want to know all my trades as they happen, I'd be happy to post. Almost ANY trade now will beat the 0.01% that SPAXX is yielding.

I'm still conflicted about ethics and morals of investing in certain companies in mutual funds (index or not, and those are my only options in the 401k), but I am working on that aspect of myself as well. Basically, when it boils down to life and death, things tend to play out like in Life of Pi, so maybe it's OK to dump ethics and morals when it comes to making money.
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Re: Bear Cub Smells Bubble

Post by marcopolo »

anoop wrote: Fri Aug 28, 2020 5:24 pm
marcopolo wrote: Fri Aug 28, 2020 5:08 pm
anoop wrote: Fri Aug 28, 2020 4:18 pm
HomerJ wrote: Fri Aug 28, 2020 4:03 pm
texasfight wrote: Fri Aug 28, 2020 12:06 pm Anoon gets its. It is all one trade, a massive expanding duration bubble. Lower real rates to push up all asset values.

If you miss out again you will be eating cat food when you retire with the CD and value investors.
(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
I don't know but to me it looks like you think the probability of a crash is 50%, which is far from "almost certain".
I can't quite understand what you are trying to say.
You said recently that you got out of the market in Feb 2008 and never got back in.

You also seem to be predicting some astronomical growth in the next couple years (Apple at $10T). Texasfight who thinks you "get it" seems to be saying you better get on this ride up. You seem content to sit on the side line, presumably waiting for the crash you believe is just around the corner. It seems you have been waiting for that for some time. I am sure you will eventually be right. The tough question is will that make up for all the lost opportunity along the way.
Glad you are keeping track. :)

I have changed my stance and I'm getting into the market.

I have bought AAPL, FB, ZM and together they have already made me more than my INTC holdings from 2015 (which I have liquidated because of the 7 nm fiasco, so much for a forever stock). My plan right now is to load up slowly on selections from FANGMANZ. This is for taxable. I don't think I will ever get to more than 50%. I'm not looking for a home run, so if they appreciate enough (e.g. say 30-40%), I may start to liquidate, wait for a correction and then get back in again. I figure might as well play a little bit. Some might find it stressful, but I am enjoying it. If you want to know all my trades as they happen, I'd be happy to post. Almost ANY trade now will beat the 0.01% that SPAXX is yielding.

I'm still conflicted about ethics and morals of investing in certain companies in mutual funds (index or not, and those are my only options in the 401k), but I am working on that aspect of myself as well. Basically, when it boils down to life and death, things tend to play out like in Life of Pi, so maybe it's OK to dump ethics and morals when it comes to making money.
Well, in that case I have to agree with HomerJ on this one.
It makes me worry that a crash is coming soon.

You have been out of the market since 2008 waiting for the crash to get back in, now recently with market at all time highs you decide it is time to get back in. I believe the word for that is "capitulation".

You have been wrong about the markets for over a decade, but now believe you can not only predict the direction of the market, but also select the specific stocks that will out perform. I believe the word for that is "hubris".

Good luck to you, hope your trades work out.
Once in a while you get shown the light, in the strangest of places if you look at it right.
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Re: Bear Cub Smells Bubble

Post by HomerJ »

anoop wrote: Fri Aug 28, 2020 5:24 pm
marcopolo wrote: Fri Aug 28, 2020 5:08 pm
anoop wrote: Fri Aug 28, 2020 4:18 pm
HomerJ wrote: Fri Aug 28, 2020 4:03 pm
texasfight wrote: Fri Aug 28, 2020 12:06 pm Anoon gets its. It is all one trade, a massive expanding duration bubble. Lower real rates to push up all asset values.

If you miss out again you will be eating cat food when you retire with the CD and value investors.
(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
I don't know but to me it looks like you think the probability of a crash is 50%, which is far from "almost certain".
I can't quite understand what you are trying to say.
You said recently that you got out of the market in Feb 2008 and never got back in.

You also seem to be predicting some astronomical growth in the next couple years (Apple at $10T). Texasfight who thinks you "get it" seems to be saying you better get on this ride up. You seem content to sit on the side line, presumably waiting for the crash you believe is just around the corner. It seems you have been waiting for that for some time. I am sure you will eventually be right. The tough question is will that make up for all the lost opportunity along the way.
Glad you are keeping track. :)

I have changed my stance and I'm getting into the market.

I have bought AAPL, FB, ZM and together they have already made me more than my INTC holdings from 2015 (which I have liquidated because of the 7 nm fiasco, so much for a forever stock). My plan right now is to load up slowly on selections from FANGMANZ. This is for taxable. I don't think I will ever get to more than 50%. I'm not looking for a home run, so if they appreciate enough (e.g. say 30-40%), I may start to liquidate, wait for a correction and then get back in again. I figure might as well play a little bit. Some might find it stressful, but I am enjoying it. If you want to know all my trades as they happen, I'd be happy to post. Almost ANY trade now will beat the 0.01% that SPAXX is yielding.

I'm still conflicted about ethics and morals of investing in certain companies in mutual funds (index or not, and those are my only options in the 401k), but I am working on that aspect of myself as well. Basically, when it boils down to life and death, things tend to play out like in Life of Pi, so maybe it's OK to dump ethics and morals when it comes to making money.
So you learned nothing?

You're enjoying missing out on 200% gains? You'd have 3x the money today if you just had bought and held, but you think it's enjoyable to play?
A Goldman Sachs associate provided a variety of detailed explanations, but then offered a caveat, “If I’m being dead-### honest, though, nobody knows what’s really going on.”
anoop
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Re: Bear Cub Smells Bubble

Post by anoop »

HomerJ wrote: Fri Aug 28, 2020 5:55 pm
anoop wrote: Fri Aug 28, 2020 5:24 pm
marcopolo wrote: Fri Aug 28, 2020 5:08 pm
anoop wrote: Fri Aug 28, 2020 4:18 pm
HomerJ wrote: Fri Aug 28, 2020 4:03 pm

(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
I don't know but to me it looks like you think the probability of a crash is 50%, which is far from "almost certain".
I can't quite understand what you are trying to say.
You said recently that you got out of the market in Feb 2008 and never got back in.

You also seem to be predicting some astronomical growth in the next couple years (Apple at $10T). Texasfight who thinks you "get it" seems to be saying you better get on this ride up. You seem content to sit on the side line, presumably waiting for the crash you believe is just around the corner. It seems you have been waiting for that for some time. I am sure you will eventually be right. The tough question is will that make up for all the lost opportunity along the way.
Glad you are keeping track. :)

I have changed my stance and I'm getting into the market.

I have bought AAPL, FB, ZM and together they have already made me more than my INTC holdings from 2015 (which I have liquidated because of the 7 nm fiasco, so much for a forever stock). My plan right now is to load up slowly on selections from FANGMANZ. This is for taxable. I don't think I will ever get to more than 50%. I'm not looking for a home run, so if they appreciate enough (e.g. say 30-40%), I may start to liquidate, wait for a correction and then get back in again. I figure might as well play a little bit. Some might find it stressful, but I am enjoying it. If you want to know all my trades as they happen, I'd be happy to post. Almost ANY trade now will beat the 0.01% that SPAXX is yielding.

I'm still conflicted about ethics and morals of investing in certain companies in mutual funds (index or not, and those are my only options in the 401k), but I am working on that aspect of myself as well. Basically, when it boils down to life and death, things tend to play out like in Life of Pi, so maybe it's OK to dump ethics and morals when it comes to making money.
So you learned nothing?

You're enjoying missing out on 200% gains? You'd have 3x the money today if you just had bought and held, but you think it's enjoyable to play?
I learned something from missing out. DNFTF.
anoop
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Re: Bear Cub Smells Bubble

Post by anoop »

marcopolo wrote: Fri Aug 28, 2020 5:43 pm
anoop wrote: Fri Aug 28, 2020 5:24 pm
marcopolo wrote: Fri Aug 28, 2020 5:08 pm
anoop wrote: Fri Aug 28, 2020 4:18 pm
HomerJ wrote: Fri Aug 28, 2020 4:03 pm

(1) This kind of talk makes me almost certain a crash is coming soon.
(2) 50/50 is definitely the right AA for me. If you're right, I'll make plenty of money even at 50% stocks, and if you're wrong, I'll still be protected.
I don't know but to me it looks like you think the probability of a crash is 50%, which is far from "almost certain".
I can't quite understand what you are trying to say.
You said recently that you got out of the market in Feb 2008 and never got back in.

You also seem to be predicting some astronomical growth in the next couple years (Apple at $10T). Texasfight who thinks you "get it" seems to be saying you better get on this ride up. You seem content to sit on the side line, presumably waiting for the crash you believe is just around the corner. It seems you have been waiting for that for some time. I am sure you will eventually be right. The tough question is will that make up for all the lost opportunity along the way.
Glad you are keeping track. :)

I have changed my stance and I'm getting into the market.

I have bought AAPL, FB, ZM and together they have already made me more than my INTC holdings from 2015 (which I have liquidated because of the 7 nm fiasco, so much for a forever stock). My plan right now is to load up slowly on selections from FANGMANZ. This is for taxable. I don't think I will ever get to more than 50%. I'm not looking for a home run, so if they appreciate enough (e.g. say 30-40%), I may start to liquidate, wait for a correction and then get back in again. I figure might as well play a little bit. Some might find it stressful, but I am enjoying it. If you want to know all my trades as they happen, I'd be happy to post. Almost ANY trade now will beat the 0.01% that SPAXX is yielding.

I'm still conflicted about ethics and morals of investing in certain companies in mutual funds (index or not, and those are my only options in the 401k), but I am working on that aspect of myself as well. Basically, when it boils down to life and death, things tend to play out like in Life of Pi, so maybe it's OK to dump ethics and morals when it comes to making money.
Well, in that case I have to agree with HomerJ on this one.
It makes me worry that a crash is coming soon.

You have been out of the market since 2008 waiting for the crash to get back in, now recently with market at all time highs you decide it is time to get back in. I believe the word for that is "capitulation".

You have been wrong about the markets for over a decade, but now believe you can not only predict the direction of the market, but also select the specific stocks that will out perform. I believe the word for that is "hubris".

Good luck to you, hope your trades work out.
Some may call it hubris. I like to think of it as having faith in the fed. It comes from a place of humility knowing the fed always has my back so I safely play.
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HomerJ
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Re: Bear Cub Smells Bubble

Post by HomerJ »

anoop wrote: Fri Aug 28, 2020 6:13 pm
HomerJ wrote: Fri Aug 28, 2020 5:55 pm
anoop wrote: Fri Aug 28, 2020 5:24 pm
marcopolo wrote: Fri Aug 28, 2020 5:08 pm
anoop wrote: Fri Aug 28, 2020 4:18 pm

I don't know but to me it looks like you think the probability of a crash is 50%, which is far from "almost certain".
I can't quite understand what you are trying to say.
You said recently that you got out of the market in Feb 2008 and never got back in.

You also seem to be predicting some astronomical growth in the next couple years (Apple at $10T). Texasfight who thinks you "get it" seems to be saying you better get on this ride up. You seem content to sit on the side line, presumably waiting for the crash you believe is just around the corner. It seems you have been waiting for that for some time. I am sure you will eventually be right. The tough question is will that make up for all the lost opportunity along the way.
Glad you are keeping track. :)

I have changed my stance and I'm getting into the market.

I have bought AAPL, FB, ZM and together they have already made me more than my INTC holdings from 2015 (which I have liquidated because of the 7 nm fiasco, so much for a forever stock). My plan right now is to load up slowly on selections from FANGMANZ. This is for taxable. I don't think I will ever get to more than 50%. I'm not looking for a home run, so if they appreciate enough (e.g. say 30-40%), I may start to liquidate, wait for a correction and then get back in again. I figure might as well play a little bit. Some might find it stressful, but I am enjoying it. If you want to know all my trades as they happen, I'd be happy to post. Almost ANY trade now will beat the 0.01% that SPAXX is yielding.

I'm still conflicted about ethics and morals of investing in certain companies in mutual funds (index or not, and those are my only options in the 401k), but I am working on that aspect of myself as well. Basically, when it boils down to life and death, things tend to play out like in Life of Pi, so maybe it's OK to dump ethics and morals when it comes to making money.
So you learned nothing?

You're enjoying missing out on 200% gains? You'd have 3x the money today if you just had bought and held, but you think it's enjoyable to play?
I learned something from missing out. DNFTF.
Well, you might miss out again, if you liquidate at some point and "wait for a correction".

That cost you dearly before, so why would you do it again?
A Goldman Sachs associate provided a variety of detailed explanations, but then offered a caveat, “If I’m being dead-### honest, though, nobody knows what’s really going on.”
Topic Author
000
Posts: 4036
Joined: Thu Jul 23, 2020 12:04 am
Location: Ursa Minor

Re: Bear Cub Smells Bubble

Post by 000 »

anoop wrote: Fri Aug 28, 2020 5:24 pm Glad you are keeping track. :)

I have changed my stance and I'm getting into the market.

I have bought AAPL, FB, ZM and together they have already made me more than my INTC holdings from 2015 (which I have liquidated because of the 7 nm fiasco, so much for a forever stock). My plan right now is to load up slowly on selections from FANGMANZ. This is for taxable. I don't think I will ever get to more than 50%. I'm not looking for a home run, so if they appreciate enough (e.g. say 30-40%), I may start to liquidate, wait for a correction and then get back in again. I figure might as well play a little bit. Some might find it stressful, but I am enjoying it. If you want to know all my trades as they happen, I'd be happy to post. Almost ANY trade now will beat the 0.01% that SPAXX is yielding.

I'm still conflicted about ethics and morals of investing in certain companies in mutual funds (index or not, and those are my only options in the 401k), but I am working on that aspect of myself as well. Basically, when it boils down to life and death, things tend to play out like in Life of Pi, so maybe it's OK to dump ethics and morals when it comes to making money.
Thanks for posting. I'm worried things may not end well with this strategy. Have you thought about a conservative balanced fund or maybe the permanent portfolio?
anoop
Posts: 1992
Joined: Tue Mar 04, 2014 1:33 am

Re: Bear Cub Smells Bubble

Post by anoop »

HomerJ wrote: Fri Aug 28, 2020 6:28 pm
anoop wrote: Fri Aug 28, 2020 6:13 pm
HomerJ wrote: Fri Aug 28, 2020 5:55 pm
anoop wrote: Fri Aug 28, 2020 5:24 pm
marcopolo wrote: Fri Aug 28, 2020 5:08 pm

I can't quite understand what you are trying to say.
You said recently that you got out of the market in Feb 2008 and never got back in.

You also seem to be predicting some astronomical growth in the next couple years (Apple at $10T). Texasfight who thinks you "get it" seems to be saying you better get on this ride up. You seem content to sit on the side line, presumably waiting for the crash you believe is just around the corner. It seems you have been waiting for that for some time. I am sure you will eventually be right. The tough question is will that make up for all the lost opportunity along the way.
Glad you are keeping track. :)

I have changed my stance and I'm getting into the market.

I have bought AAPL, FB, ZM and together they have already made me more than my INTC holdings from 2015 (which I have liquidated because of the 7 nm fiasco, so much for a forever stock). My plan right now is to load up slowly on selections from FANGMANZ. This is for taxable. I don't think I will ever get to more than 50%. I'm not looking for a home run, so if they appreciate enough (e.g. say 30-40%), I may start to liquidate, wait for a correction and then get back in again. I figure might as well play a little bit. Some might find it stressful, but I am enjoying it. If you want to know all my trades as they happen, I'd be happy to post. Almost ANY trade now will beat the 0.01% that SPAXX is yielding.

I'm still conflicted about ethics and morals of investing in certain companies in mutual funds (index or not, and those are my only options in the 401k), but I am working on that aspect of myself as well. Basically, when it boils down to life and death, things tend to play out like in Life of Pi, so maybe it's OK to dump ethics and morals when it comes to making money.
So you learned nothing?

You're enjoying missing out on 200% gains? You'd have 3x the money today if you just had bought and held, but you think it's enjoyable to play?
I learned something from missing out. DNFTF.
Well, you might miss out again, if you liquidate at some point and "wait for a correction".

That cost you dearly before, so why would you do it again?
I guess it really depends on the message coming out of the fed or if I feel the company might announce not so stellar results. I might miss out, you are right about that.
FireProof
Posts: 765
Joined: Thu May 05, 2011 12:15 pm

Re: Bear Cub Smells Bubble

Post by FireProof »

Contrary to your post, everyone I meet is saying stocks are clearly overvalued, so maybe they are OK.
anoop
Posts: 1992
Joined: Tue Mar 04, 2014 1:33 am

Re: Bear Cub Smells Bubble

Post by anoop »

FireProof wrote: Fri Aug 28, 2020 6:50 pm Contrary to your post, everyone I meet is saying stocks are clearly overvalued, so maybe they are OK.
They have been overvalued for the better part of the last 10 years.
https://www.advisorperspectives.com/dsh ... overvalued

Economic analysis is meaningless. DNFTF.
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