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Del
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Post by Del »

sweetandsour wrote: 10 Jun 2022, 12:57 The talking heads are saying SP will go to 3500. Earlier this week I sold the NVDA that I bought at 162, at 190. The NVDA I bought at 220 will just have to wait.
When do the jabber heads say that this will happen? Next week? Or "sometime"?
Next Wednesday is full of scary news: Retail Sales (a key metric of consumer behavior), also a closely watched poll of manufacturers and their outlook, and the Fed will announce their latest rate hike. The market has priced in an increase of "0.5%, possibly 0.75%." Plus, the Fed discloses their outlook for future rate hikes.

We could see the market fall off the bed and smash the floor. However, 3500 would be quite harmless for a low during this recession. There's a whole lot more "down" underneath there.
sweetandsour wrote: 10 Jun 2022, 12:57Re the new inflation number, Kramer (Cramer?) this morning said we're getting back into Carter country. Feds are saying inflation has peaked, but the big investors are saying "prove it". Lots of double talk going on, with the words "inflation", and "prices". "Inflation has peaked, but prices may not have peaked", I read somewhere.
If we hit the max inflation rate and then live with it for 2 or 3 more years, then prices will keep going up at 8%+ per year. That's about 25% loss on our spending power before we get back on our feet. Plus unemployment will go up, with rolling electric power blackouts across the nation, and we haven't seen the gross impact on grocery prices yet due to drought, fuel costs, and fertilizer shortage.

We can still make money in the market, but there's going to be a lot of pain in everyone's lives.
sweetandsour wrote: 10 Jun 2022, 12:57Anyway, until I know better, I'll buy and sell with my play account. If NVDA goes below 160 Ill probably buy it back, again.
You can buy cheap stocks from now until the recession ends, but you may have to be patient.

At our age, you should learn how to make money in minutes, days, and weeks.... rather than waiting years for a possible pay-off. The hardest part is discerning your own risk tolerance.
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Post by sweetandsour »

sweetandsour wrote: 10 Jun 2022, 12:57Anyway, until I know better, I'll buy and sell with my play account. If NVDA goes below 160 Ill probably buy it back, again.
You can buy cheap stocks from now until the recession ends, but you may have to be patient.

At our age, you should learn how to make money in minutes, days, and weeks.... rather than waiting years for a possible pay-off. The hardest part is discerning your own risk tolerance.
[/quote]

That's not the hardest part for me. The hard part is when to cut my losses and get out; but I'm working on that.
Del wrote: 10 Jun 2022, 14:06
and the Fed will announce their latest rate hike. The market has priced in an increase of "0.5%, possibly 0.75%." Plus, the Fed discloses their outlook for future rate hikes.

Yeah, I saw that, 0.75%
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Post by Del »

The stock market is closed today. Apparently, a whole new federal holiday done snuck up upon all of us without any warning or fanfare.
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Post by sweetandsour »

Del wrote: 20 Jun 2022, 06:14 The stock market is closed today. Apparently, a whole new federal holiday done snuck up upon all of us without any warning or fanfare.
Blame Texas.

Anyway, these 3-day weekends are killing me.
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Post by Del »

I finally ran across an article that sums up my feelings on the market and economy:

Investment Banks Predict How Much More Stock Market Could Plummet
The S&P 500, a key stock market index, could drop another 15% to 20% before fully adjusting to a looming recession, according to a recent analysts’ note from investment bank Morgan Stanley.

“The bear market will not be over until recession arrives or the risk of one is extinguished,” the note predicted, per Bloomberg. Meanwhile, analysts from Goldman Sachs said stock traders were only pricing in a mild recession, “leaving them exposed to a further deterioration in expectations.”
My crystal ball isn't precise at all, but I can imagine a long and painful recession pretty easily. SP500 getting down to 2500 (-50% from the Jan 2020 high). Market will find a bottom and flounder around that level until recovery.

We'll need more than just a couple of elections.... even if Republicans can reverse the Biden policies strangling our energy production, oil companies are not going to invest if the next Democrat president can baby-slap them as easily as Biden did on Day 1, killing vital pipelines and strangling active pumps with a huge environmental tax.

We need a Republican Congress to signal that it wants to pass strong regulations protecting America's vital energy supply. And we'll probably need a Republican president to sign it. Then oil companies will feel safe to invest in exploration, pipelines, and refineries.

So the quickest market recovery we can hope for is starting sometime in 2025.

Us older guys, watching our 401k and looking at retirement, gonna have to be patient.

The next big market clobbering dates:
July 13 - CPI inflation from June data announced
July 27 - Fed Reserve meeting, announce new rate increases
July 28 - Q2 Gross Domestic Product announced. If negative, we are officially in a recession. If more negative than expected, we are screwed.
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Post by coco »

You aren't looking at the positives, Del. The US carbon emissions will go way down if we all starve to death.
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Post by Del »

coco wrote: 21 Jun 2022, 12:59 You aren't looking at the positives, Del. The US carbon emissions will go way down if we all starve to death.
:biggrin: I'm still trying to reconcile Biden's electric cars with Biden's rolling blackouts! Coming this summer all across middle America.

I don't even want to chatter about politics, except to explore opportunities for rebuilding something great and good from the avalanche that is already falling.

Still, there are some obvious policy changes that need to happen before we can restore our prosperity and quality of life. And the Party that cares about the Middle Class, the Working Poor, and the retired folks still trying to live the American dream..... is not in power right now.
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Post by Del »

I've drawn a line through the SP500 going back about 15 years. A straight line that marks the "normal rate of return" for healthy growth of our economy and investments. And guess what?.....

We are right where we ought to be, at SP500 = 3765 on June 21, 2022.

If there hadn't been any covid, if Trump had won in 2020, and if the MAGA economy had chugged along just fine, with Keystone completed and Putin contained.... we'd be right were we are and very happy to be here, looking up and forward to more good times.

The Trump/covid stimulus -- and the much larger and superfluous Biden recovery stimulus -- pumped 33% more cash into the economy, producing an artificial bubble in the market. And now that bubble has deflated back to "normal."

I know that your 401k lost 25% since January, but that was never real in the first place. The stock market recovery after covid just zoomed past normal and kept on zooming, and this was bound to recover to normal under the best of circumstances.

Unfortunately, the stimulus money has caused a lot of inflation because there was no real productivity to match all that money-machine cash. And now we are staring into a long recession, as Biden has strangled the energy supply that fuels America's productivity.

It's going to be a rough at home.... with inflation and unemployment. And the market is going to drop below normal return for a few years. It looks worse than it should, with recession closely following a market bubble.

I just want to say that it's not as bad as it looks, as far as your 401k is concerned.
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Post by gaining_age »

cash... cash is a position. May not beat inflation but interest could beat market drops.


Timing.... you always time the market to some degree.


Puts/calls--- I refuse to do anything with my account that is related to "credit" moves. This is what they require me to do (which means I could also short... which is not my jive)--- so I do not.

My purchases are closer to 50-150 a shot --- but I have zero transaction fees so I trickle a lot.... <how embarrassing> .


G
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Post by Del »

gaining_age wrote: 21 Jun 2022, 20:13 cash... cash is a position. May not beat inflation but interest could beat market drops.


Timing.... you always time the market to some degree.


Puts/calls--- I refuse to do anything with my account that is related to "credit" moves. This is what they require me to do (which means I could also short... which is not my jive)--- so I do not.

My purchases are closer to 50-150 a shot --- but I have zero transaction fees so I trickle a lot.... <how embarrassing> .


G
Ahoy GA! Welcome back!!!!

Tim (S&S) and I have been having a lot of fun watching the market together. We have different trading styles, and we've learned a lot from each other.

The market indexes are down 20% or more from their record highs, but my little trading account is up 10% YTD. (It would be much higher, but I've made some very clumsy mistakes.) My goal is to learn how to make money in any market -- up, down, or sideways. Ultimately, I want to draw a meaningful cash allowance from my earnings each month.

Anyhow, you are doing well to keep your position sizes small as you learn and get more comfortable with trading. Are you having fun with it? What stocks are you following?
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