U.S. stocks in freefall

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retiringwhen
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Re: U.S. stocks in freefall

Post by retiringwhen » Mon Apr 16, 2018 11:38 am

cfs wrote:
Mon Apr 16, 2018 11:32 am
The Running of the Bulls

Oh boy, they are back, at least for the past couple of minutes.

You just don't want to be out of this market for ONE day!

Gracias por leer ~cfs~
Don’t you know. I had about 3% of our portfolio out of the market over the previous weekend due to a rebalancing trade from a MF to an ETF that required the MF sale to settle before making the buy during Monday trading last week. I was on pins and needles :-)

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Mon Apr 16, 2018 1:08 pm

Well, Mister Retiringwhen, by switching between accounts you are NOT out of the market. On the other hand, I have read about some posters waiting for the right moment to jump back IN the market (to them I say, what are you waiting for). As I have said ad nauseam, you just don't want to be out of this market for ONE day! Gracias por leer ~cfs~
~ Your Money, Your Portfolio, Your Decision ~

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Mon Apr 16, 2018 1:34 pm

Interesting article by Mister Russel Kinnel from Morningstar.

"Who Got Burned in the Sell-Off"

http://www.morningstar.com/articles/859 ... lloff.html

Good luck, y gracias por leer ~cfs~

p.s. You just don't want to be out of this market for ONE day!
~ Your Money, Your Portfolio, Your Decision ~

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Tue Apr 17, 2018 3:37 pm

The Running of the Bulls

They are running, but some of us are still sitting on the sidelines waiting for the right time to jump back IN or looking for the right product to invest our American Pesos. Need help deciding? Here is a good article by Karen Wallace from Morningstar with some good ideas on core-holders.

"The list below contains our 20 highest-conviction core holding index funds and exchange-traded funds. They are all compelling offerings that efficiently track a broadly diversified and representative benchmark at a low cost. "

Our Favorite Core Passive Funds and ETFs: http://www.morningstar.com/articles/859 ... -etfs.html

Good luck, y gracias por leer ~cfs~

p.s. You just don't want to be out of this market for ONE day!
~ Your Money, Your Portfolio, Your Decision ~

robertmcd
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Re: U.S. stocks in freefall

Post by robertmcd » Tue Apr 17, 2018 4:08 pm

The yield curve continuing to flatten these past 2 days even as stocks going up.

MotoTrojan
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Re: U.S. stocks in freefall

Post by MotoTrojan » Tue Apr 17, 2018 4:18 pm

Less than 2 weeks from my windfall and it is falling the wrong way :(.

Thesaints
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Re: U.S. stocks in freefall

Post by Thesaints » Tue Apr 17, 2018 4:20 pm

robertmcd wrote:
Tue Apr 17, 2018 4:08 pm
The yield curve continuing to flatten these past 2 days even as stocks going up.
This time troubles will be signaled by a curve increasingly sloping...

robertmcd
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Re: U.S. stocks in freefall

Post by robertmcd » Tue Apr 17, 2018 5:22 pm

Except if that happens, global asset prices will get obliterated. I would love for the distortions that the Fed has created to naturally correct themselves as they would in a free market, but we don't have a free market and that cannot happen at this point. It would have been easy to dig out from the 2001 collapse, but instead the Fed blew a monster mortgage bubble. It would have been tough but we could have dug our way out of the 2008 recession, but instead the Fed kicked the can again, and now we have a situation that we cannot get out of. My money is on continued can kicking with ever decreasing interest rates and bigger asset bubbles. Nothing would make me happier than to lose 50% of my net worth in stocks and long dated treasuries at my age of 24 because as of right now I feel I am in even bigger trouble because I never got a chance to accumulate assets with my wages.

Thesaints
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Re: U.S. stocks in freefall

Post by Thesaints » Tue Apr 17, 2018 5:25 pm

When has ever the Fed not "distorted" the market ?

robertmcd
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Re: U.S. stocks in freefall

Post by robertmcd » Tue Apr 17, 2018 5:41 pm

They have since its creation, but the recent foray into ZIRP after 2000, and massive QE after 2008 show that the insanity is accelerating. Look at the BOJ for the future direction we are headed. They own 75% of Japanese ETF's and they have become the only buyer of japanese government debt.

Read up on Fed nominee Marvin Goodfriend's ideas about getting past the issue of people holding onto cash in times of negative interest rates. The Fed kicking the can further is to me the simplest solution to keep things humming along. Occam's Razor

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Re: U.S. stocks in freefall

Post by Thesaints » Tue Apr 17, 2018 5:47 pm

robertmcd wrote:
Tue Apr 17, 2018 5:41 pm
They have since its creation, but the recent foray into ZIRP after 2000, and massive QE after 2008 show that the insanity is accelerating. Look at the BOJ for the future direction we are headed. They own 75% of Japanese ETF's and they have become the only buyer of japanese government debt.
Whereas everything would be fine, if a private subject did ?

tesuzuki2002
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Re: U.S. stocks in freefall

Post by tesuzuki2002 » Tue Apr 17, 2018 5:49 pm

retiringwhen wrote:
Mon Apr 16, 2018 11:38 am
cfs wrote:
Mon Apr 16, 2018 11:32 am
The Running of the Bulls

Oh boy, they are back, at least for the past couple of minutes.

You just don't want to be out of this market for ONE day!

Gracias por leer ~cfs~
Don’t you know. I had about 3% of our portfolio out of the market over the previous weekend due to a rebalancing trade from a MF to an ETF that required the MF sale to settle before making the buy during Monday trading last week. I was on pins and needles :-)
Moving money around can be hard some times... esp. during volatility periods. I like to hope I get lucky and sell on the up day so I can buy on the down day!!!

MotoTrojan
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Re: U.S. stocks in freefall

Post by MotoTrojan » Tue Apr 17, 2018 5:54 pm

robertmcd wrote:
Tue Apr 17, 2018 5:22 pm
Except if that happens, global asset prices will get obliterated. I would love for the distortions that the Fed has created to naturally correct themselves as they would in a free market, but we don't have a free market and that cannot happen at this point. It would have been easy to dig out from the 2001 collapse, but instead the Fed blew a monster mortgage bubble. It would have been tough but we could have dug our way out of the 2008 recession, but instead the Fed kicked the can again, and now we have a situation that we cannot get out of. My money is on continued can kicking with ever decreasing interest rates and bigger asset bubbles. Nothing would make me happier than to lose 50% of my net worth in stocks and long dated treasuries at my age of 24 because as of right now I feel I am in even bigger trouble because I never got a chance to accumulate assets with my wages.
What distortion? How far out of line is the S&P 500's forward P/E right now?

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willthrill81
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Re: U.S. stocks in freefall

Post by willthrill81 » Tue Apr 17, 2018 7:01 pm

MotoTrojan wrote:
Tue Apr 17, 2018 5:54 pm
robertmcd wrote:
Tue Apr 17, 2018 5:22 pm
Except if that happens, global asset prices will get obliterated. I would love for the distortions that the Fed has created to naturally correct themselves as they would in a free market, but we don't have a free market and that cannot happen at this point. It would have been easy to dig out from the 2001 collapse, but instead the Fed blew a monster mortgage bubble. It would have been tough but we could have dug our way out of the 2008 recession, but instead the Fed kicked the can again, and now we have a situation that we cannot get out of. My money is on continued can kicking with ever decreasing interest rates and bigger asset bubbles. Nothing would make me happier than to lose 50% of my net worth in stocks and long dated treasuries at my age of 24 because as of right now I feel I am in even bigger trouble because I never got a chance to accumulate assets with my wages.
What distortion? How far out of line is the S&P 500's forward P/E right now?
Out of line with what? Stocks are priced at what the market deems they should be today.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

MotoTrojan
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Re: U.S. stocks in freefall

Post by MotoTrojan » Tue Apr 17, 2018 7:06 pm

willthrill81 wrote:
Tue Apr 17, 2018 7:01 pm
MotoTrojan wrote:
Tue Apr 17, 2018 5:54 pm
robertmcd wrote:
Tue Apr 17, 2018 5:22 pm
Except if that happens, global asset prices will get obliterated. I would love for the distortions that the Fed has created to naturally correct themselves as they would in a free market, but we don't have a free market and that cannot happen at this point. It would have been easy to dig out from the 2001 collapse, but instead the Fed blew a monster mortgage bubble. It would have been tough but we could have dug our way out of the 2008 recession, but instead the Fed kicked the can again, and now we have a situation that we cannot get out of. My money is on continued can kicking with ever decreasing interest rates and bigger asset bubbles. Nothing would make me happier than to lose 50% of my net worth in stocks and long dated treasuries at my age of 24 because as of right now I feel I am in even bigger trouble because I never got a chance to accumulate assets with my wages.
What distortion? How far out of line is the S&P 500's forward P/E right now?
Out of line with what? Stocks are priced at what the market deems they should be today.
Trying to understand what the quoted person was using as a metric for this out of line bubble. I don’t agree but I presumed they were using some metric that is far above historic norm (cape10) but what matters most, forward returns, is quite healthy.

Either way, I agree with you. I buy at a fair price every time I buy. It’s the market price as you said.

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willthrill81
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Re: U.S. stocks in freefall

Post by willthrill81 » Tue Apr 17, 2018 7:07 pm

MotoTrojan wrote:
Tue Apr 17, 2018 7:06 pm
willthrill81 wrote:
Tue Apr 17, 2018 7:01 pm
MotoTrojan wrote:
Tue Apr 17, 2018 5:54 pm
robertmcd wrote:
Tue Apr 17, 2018 5:22 pm
Except if that happens, global asset prices will get obliterated. I would love for the distortions that the Fed has created to naturally correct themselves as they would in a free market, but we don't have a free market and that cannot happen at this point. It would have been easy to dig out from the 2001 collapse, but instead the Fed blew a monster mortgage bubble. It would have been tough but we could have dug our way out of the 2008 recession, but instead the Fed kicked the can again, and now we have a situation that we cannot get out of. My money is on continued can kicking with ever decreasing interest rates and bigger asset bubbles. Nothing would make me happier than to lose 50% of my net worth in stocks and long dated treasuries at my age of 24 because as of right now I feel I am in even bigger trouble because I never got a chance to accumulate assets with my wages.
What distortion? How far out of line is the S&P 500's forward P/E right now?
Out of line with what? Stocks are priced at what the market deems they should be today.
Trying to understand what the quoted person was using as a metric for this out of line bubble. I don’t agree but I presumed they were using some metric that is far above historic norm (cape10) but what matters most, forward returns, is quite healthy.

Either way, I agree with you. I buy at a fair price every time I buy. It’s the market price as you said.
:sharebeer
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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nedsaid
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Re: U.S. stocks in freefall

Post by nedsaid » Tue Apr 17, 2018 8:39 pm

Oh Oh. I joked a lot about how this thread was a contrary indicator. With the exception of the August 2015 through February 2016 market correction, it seemed that after this thread would pop up again that the market would rally. Now it seems that every time someone posts after a market rally that the recent correction wasn't all that bad that the market seems to fall again. So I guess this thread is a contrary, contrary indicator. Pretty much, the market falls now when the thread pops up again. :wink: This is why I don't write market timing newsletters. Anywho, I have had a lot of fun with this. Also goes to show that timing indicators work until they don't.
A fool and his money are good for business.

Thesaints
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Re: U.S. stocks in freefall

Post by Thesaints » Tue Apr 17, 2018 11:42 pm

nedsaid wrote:
Tue Apr 17, 2018 8:39 pm
Oh Oh. I joked a lot about how this thread was a contrary indicator. With the exception of the August 2015 through February 2016 market correction, it seemed that after this thread would pop up again that the market would rally. Now it seems that every time someone posts after a market rally that the recent correction wasn't all that bad that the market seems to fall again. So I guess this thread is a contrary, contrary indicator. Pretty much, the market falls now when the thread pops up again.
Oh my gosh! You just described the concept of "uncorrelation" :)

dziuniek
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Re: U.S. stocks in freefall

Post by dziuniek » Wed Apr 18, 2018 8:50 am

I think people are missing the fact that the FED can't distort something it's a part of. :twisted:
(more so than ever)

robertmcd
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Re: U.S. stocks in freefall

Post by robertmcd » Wed Apr 18, 2018 10:07 am

MotoTrojan wrote:
Tue Apr 17, 2018 7:06 pm
willthrill81 wrote:
Tue Apr 17, 2018 7:01 pm
MotoTrojan wrote:
Tue Apr 17, 2018 5:54 pm
robertmcd wrote:
Tue Apr 17, 2018 5:22 pm
Except if that happens, global asset prices will get obliterated. I would love for the distortions that the Fed has created to naturally correct themselves as they would in a free market, but we don't have a free market and that cannot happen at this point. It would have been easy to dig out from the 2001 collapse, but instead the Fed blew a monster mortgage bubble. It would have been tough but we could have dug our way out of the 2008 recession, but instead the Fed kicked the can again, and now we have a situation that we cannot get out of. My money is on continued can kicking with ever decreasing interest rates and bigger asset bubbles. Nothing would make me happier than to lose 50% of my net worth in stocks and long dated treasuries at my age of 24 because as of right now I feel I am in even bigger trouble because I never got a chance to accumulate assets with my wages.
What distortion? How far out of line is the S&P 500's forward P/E right now?
Out of line with what? Stocks are priced at what the market deems they should be today.
Trying to understand what the quoted person was using as a metric for this out of line bubble. I don’t agree but I presumed they were using some metric that is far above historic norm (cape10) but what matters most, forward returns, is quite healthy.

Either way, I agree with you. I buy at a fair price every time I buy. It’s the market price as you said.
Just like those buying at the peak of the tech bubble? How about bitcoin at 19K? Efficient market hypothesis didn't work out so well there.

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willthrill81
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Re: U.S. stocks in freefall

Post by willthrill81 » Wed Apr 18, 2018 10:13 am

robertmcd wrote:
Wed Apr 18, 2018 10:07 am
MotoTrojan wrote:
Tue Apr 17, 2018 7:06 pm
willthrill81 wrote:
Tue Apr 17, 2018 7:01 pm
MotoTrojan wrote:
Tue Apr 17, 2018 5:54 pm
robertmcd wrote:
Tue Apr 17, 2018 5:22 pm
Except if that happens, global asset prices will get obliterated. I would love for the distortions that the Fed has created to naturally correct themselves as they would in a free market, but we don't have a free market and that cannot happen at this point. It would have been easy to dig out from the 2001 collapse, but instead the Fed blew a monster mortgage bubble. It would have been tough but we could have dug our way out of the 2008 recession, but instead the Fed kicked the can again, and now we have a situation that we cannot get out of. My money is on continued can kicking with ever decreasing interest rates and bigger asset bubbles. Nothing would make me happier than to lose 50% of my net worth in stocks and long dated treasuries at my age of 24 because as of right now I feel I am in even bigger trouble because I never got a chance to accumulate assets with my wages.
What distortion? How far out of line is the S&P 500's forward P/E right now?
Out of line with what? Stocks are priced at what the market deems they should be today.
Trying to understand what the quoted person was using as a metric for this out of line bubble. I don’t agree but I presumed they were using some metric that is far above historic norm (cape10) but what matters most, forward returns, is quite healthy.

Either way, I agree with you. I buy at a fair price every time I buy. It’s the market price as you said.
Just like those buying at the peak of the tech bubble? How about bitcoin at 19K? Efficient market hypothesis didn't work out so well there.
While I don't believe in the EMH, it is impossible for you to know if you're getting a 'bad deal' unless you know what will happen to stocks in the future. Absent from this foreknowledge, stocks are always priced at what the market deems they should be. Whether this is the 'right' price or not is unknowable.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

lostdog
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Re: U.S. stocks in freefall

Post by lostdog » Wed Apr 18, 2018 10:14 am

International today :)
Financial independence is the best revenge.

MotoTrojan
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Re: U.S. stocks in freefall

Post by MotoTrojan » Wed Apr 18, 2018 10:20 am

robertmcd wrote:
Wed Apr 18, 2018 10:07 am
MotoTrojan wrote:
Tue Apr 17, 2018 7:06 pm
willthrill81 wrote:
Tue Apr 17, 2018 7:01 pm
MotoTrojan wrote:
Tue Apr 17, 2018 5:54 pm
robertmcd wrote:
Tue Apr 17, 2018 5:22 pm
Except if that happens, global asset prices will get obliterated. I would love for the distortions that the Fed has created to naturally correct themselves as they would in a free market, but we don't have a free market and that cannot happen at this point. It would have been easy to dig out from the 2001 collapse, but instead the Fed blew a monster mortgage bubble. It would have been tough but we could have dug our way out of the 2008 recession, but instead the Fed kicked the can again, and now we have a situation that we cannot get out of. My money is on continued can kicking with ever decreasing interest rates and bigger asset bubbles. Nothing would make me happier than to lose 50% of my net worth in stocks and long dated treasuries at my age of 24 because as of right now I feel I am in even bigger trouble because I never got a chance to accumulate assets with my wages.
What distortion? How far out of line is the S&P 500's forward P/E right now?
Out of line with what? Stocks are priced at what the market deems they should be today.
Trying to understand what the quoted person was using as a metric for this out of line bubble. I don’t agree but I presumed they were using some metric that is far above historic norm (cape10) but what matters most, forward returns, is quite healthy.

Either way, I agree with you. I buy at a fair price every time I buy. It’s the market price as you said.
Just like those buying at the peak of the tech bubble? How about bitcoin at 19K? Efficient market hypothesis didn't work out so well there.
Those that bought S&P500 at top of the tech bubble are doing okay right now. Bitcoin doesn’t fit within the EMH in my view.

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Wed Apr 18, 2018 11:45 am

The Running of the Bull

Some of them are running today . . . what are YOU doing?

Good luck, y gracias por leer ~cfs~

p.s. You just don't want to be out of this market for ONE day!!!
~ Your Money, Your Portfolio, Your Decision ~

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nedsaid
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Re: U.S. stocks in freefall

Post by nedsaid » Wed Apr 18, 2018 6:18 pm

dziuniek wrote:
Wed Apr 18, 2018 8:50 am
I think people are missing the fact that the FED can't distort something it's a part of. :twisted:
(more so than ever)
Except that the Fed did some unprecedented things, for example, the purchase of Mortgage Instruments to help bring down mortgage rates. Historically, the Fed limited its purchases of bonds to Treasuries. They also brought short term rates down to almost zero. Hence the nickname, Helicopter Ben, the mental image of the former Fed Chairman dropping cash from helicopters to the people below. The TARP (Troubled Assets Relief Program) also took very aggressive steps forcing even strong banks to take bailout money and forcing the merger of weak financial institutions into strong ones. Literally, everything but the kitchen sink was thrown at the financial crisis to prevent a second Great Recession. Probably when we weren't looking, probably the kitchen sink was thrown in too. Pretty amazing things happened.
A fool and his money are good for business.

gmaynardkrebs
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Re: U.S. stocks in freefall

Post by gmaynardkrebs » Wed Apr 18, 2018 6:33 pm

willthrill81 wrote:
Wed Apr 18, 2018 10:13 am

While I don't believe in the EMH,
it is impossible for you to know if you're getting a 'bad deal' unless you know what will happen to stocks in the future. Absent from this foreknowledge, stocks are always priced at what the market deems they should be.
That is the EMH.

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willthrill81
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Re: U.S. stocks in freefall

Post by willthrill81 » Wed Apr 18, 2018 7:21 pm

gmaynardkrebs wrote:
Wed Apr 18, 2018 6:33 pm
willthrill81 wrote:
Wed Apr 18, 2018 10:13 am

While I don't believe in the EMH,
it is impossible for you to know if you're getting a 'bad deal' unless you know what will happen to stocks in the future. Absent from this foreknowledge, stocks are always priced at what the market deems they should be.
That is the EMH.
By definition, stocks must be priced at what the market currently thinks they should be.

The EMH goes further than that and says that asset prices fully reflect all available information. I do not believe that stock prices fully reflect all available information, mainly because the actors are human beings with all of the fallibility and biases pertaining thereto.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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JoMoney
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Re: U.S. stocks in freefall

Post by JoMoney » Wed Apr 18, 2018 8:54 pm

willthrill81 wrote:
Wed Apr 18, 2018 7:21 pm
gmaynardkrebs wrote:
Wed Apr 18, 2018 6:33 pm
willthrill81 wrote:
Wed Apr 18, 2018 10:13 am

While I don't believe in the EMH,
it is impossible for you to know if you're getting a 'bad deal' unless you know what will happen to stocks in the future. Absent from this foreknowledge, stocks are always priced at what the market deems they should be.
That is the EMH.
By definition, stocks must be priced at what the market currently thinks they should be.

The EMH goes further than that and says that asset prices fully reflect all available information. I do not believe that stock prices fully reflect all available information, mainly because the actors are human beings with all of the fallibility and biases pertaining thereto.
"The China Hustle" movie (discussed over in this thread) suggests an interesting example of the asymmetry of information sometimes in the market. One the main subjects in the movie made a lot of money shorting the stocks after doing some 'due diligence' and seeing for himself that the businesses were not at all what they reported on paper to be.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

gmaynardkrebs
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Re: U.S. stocks in freefall

Post by gmaynardkrebs » Wed Apr 18, 2018 9:15 pm

JoMoney wrote:
Wed Apr 18, 2018 8:54 pm
willthrill81 wrote:
Wed Apr 18, 2018 7:21 pm
gmaynardkrebs wrote:
Wed Apr 18, 2018 6:33 pm
willthrill81 wrote:
Wed Apr 18, 2018 10:13 am

While I don't believe in the EMH,
it is impossible for you to know if you're getting a 'bad deal' unless you know what will happen to stocks in the future. Absent from this foreknowledge, stocks are always priced at what the market deems they should be.
That is the EMH.
By definition, stocks must be priced at what the market currently thinks they should be.

The EMH goes further than that and says that asset prices fully reflect all available information. I do not believe that stock prices fully reflect all available information, mainly because the actors are human beings with all of the fallibility and biases pertaining thereto.
"The China Hustle" movie (discussed over in this thread) suggests an interesting example of the asymmetry of information sometimes in the market. One the main subjects in the movie made a lot of money shorting the stocks after doing some 'due diligence' and seeing for himself that the businesses were not at all what they reported on paper to be.
That is the mechanism by which the EMH works, not a disproof. I am sure there have been many discussions of the weak and form strong of the EMH, so I won't belabor the distinction. If you are arguing that the strong form the EMH is too extreme, I agree, but as long as it is mostly right, most of the time (the weak) form is what you both accept, as it allows for the "fallibilities" to exist for short periods. If you told me that a 100 dollar bill sat out in the open on 5th Avenue with people not picking it for 5 minutes, that might be enough to disprove the strong form; it would take 5 hours to raise doubts about about the weak form, which is true enough to explain why market prices reflect all available public information, with inconsequential delays or gaps.

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