Stock Trading

[Del]

Entering correction territory. I sold my few shares of NEM this morning, and contemplating capturing profits on my Fid Eq Index as well, and then watch the volatility from the sideline next week. I'm tempted to buy FTAI below 100 though.
Re Harris, that's all we're going to see and hear about everywhere until November. Was predictable, but still, scary.

What is a recession? I think it is broadly defined as two or three quarters of negative GDP growth.

A recession usually means corporate losses (or at least a reduction of corporate earnings), and this is what Mr. Market fears most.

Amazon reported earnings this morning. Earnings beat market expectations, but AMZN revenues were less than expected. Mr. Market takes this as a sign that consumers aren't spending as much.... Coupled with the news that manufacturers are pulling back on their future production.

In an environment of recession fears, the Market is going to pay close attention to election polls. Trump's policy of lower energy costs is now a much bigger deal than FED interest rates.

Tariff taxes and the status of illegal immigrants (plentiful labor supply) are also going to be a factor in some sectors. Don't tell Wosbald, but this is the reason why I do not believe that Trump will actually deport millions of illegal immigrants.

[sweetandsour]

CNN's fear and greed index from last Friday.

https://www.cnn.com/markets/fear-and-greed

[Del]

CNN's fear and greed index from last Friday.

https://www.cnn.com/markets/fear-and-greed

the index has dropped into "Extreme Fear" this morning.

Japan market is in a crash.

US market is in free fall. Think Wyle E. Coyote.

the last three weeks have been hell on my condors. All my work for the last two years is undone.... I'm back to where I started.

[sweetandsour]

CNN's fear and greed index from last Friday.

https://www.cnn.com/markets/fear-and-greed

the index has dropped into "Extreme Fear" this morning.

Japan market is in a crash.

US market is in free fall. Think Wyle E. Coyote.

the last three weeks have been hell on my condors. All my work for the last two years is undone.... I'm back to where I started.

I feel for you. My small trading account is our only account that was not affected, since I had all positions closed and in cash. I'll be watching closely in the morning, looking for buy opportunities. My Fidelity Equity acct value dropped, and I'd like to sell it to capture this year's profits, but selling that one is tricky since it only sells for whatever the price is at the end of the day. Several commentators are saying that we will likely see a quick rebound, if only temporary. This may be the norm until after the election.

from Reuters:

LONDON, Aug 5 (Reuters) - A meltdown in world equity markets in recent days is more reflective of a wind-down of carry trades used by investors to juice their bets than a hard and fast shift in the U.S. economic outlook, analysts say.

While Friday's weaker-than-expected U.S. jobs data was the catalyst for the market sell-off, with Japan's blue-chip Nikkei index on Monday suffering its biggest one-day rout since the 1987 Black Monday selloff, the employment report alone wasn't weak enough to be the main driver of such violent moves, they added.

Instead, the answer likely lies in a further sharp position unwind of carry trades
where investors have borrowed money from economies with low interest rates such as Japan or Switzerland, to fund investments in higher-yielding assets elsewhere.

They have been caught out as the Japanese yen has rallied by more than 11% against the dollar from 38-year lows hit just a month ago.

"In our assessment a lot of this (market sell-off) has been down to position capitulation as a number of macro funds have been caught the wrong way around on a trade, and stops have been triggered, initially starting with FX and the Japanese yen," said Mark Dowding, chief investment officer at BlueBay Asset Management, referring to pre-determined levels that trigger buying or selling.

"We don't see evidence in data that's saying we're looking at a hard landing," he added.

[Del]

CNN's fear and greed index from last Friday.

https://www.cnn.com/markets/fear-and-greed

the index has dropped into "Extreme Fear" this morning.

Japan market is in a crash.

US market is in free fall. Think Wyle E. Coyote.

the last three weeks have been hell on my condors. All my work for the last two years is undone.... I'm back to where I started.

I feel for you. My small trading account is our only account that was not affected, since I had all positions closed and in cash. I'll be watching closely in the morning, looking for buy opportunities. My Fidelity Equity acct value dropped, and I'd like to sell it to capture this year's profits, but selling that one is tricky since it only sells for whatever the price is at the end of the day. Several commentators are saying that we will likely see a quick rebound, if only temporary. This may be the norm until after the election; the Fed has become a political pawn.

I don't believe that this FED Board under Powell is political. They have stuck to their mission of low inflation and full employment, and their comments have been grounded in data. If they wanted to help Biden, they would have lowered rates a bit more quickly. I don't think they would be biased toward Trump.

If I were the FED, I'd be watching the markets and and indicators closely, with a bias toward lowering rates in September -- perhaps by a half point, instead of the "measured" quarter point.

In the meantime, the FED could buy back some bonds -- thus injecting more cash into the economy to mitigate recession fears. But this might trigger inflation before the economy grows away from recession. My guess is that the FED will strap in like the rest of us and see what's working after the rough road is behind us.

The FED does not mind the market much -- too emotional and volatile. They like to look at hard economic data.
===========================

The Reuters report makes sense. The Big Boys are moving the market beyond rational analysis. Let's all see where the dust settles.

[Del]

Guy on Daily Wire (of all places) breaks down the chaos on easy language:

Is The Market Sell-Off A ’Hiccup’ Or ’The Big One’?

[JimVH]

The markets have some cruel timing.

[sweetandsour]

the index has dropped into "Extreme Fear" this morning.

Japan market is in a crash.

US market is in free fall. Think Wyle E. Coyote.

the last three weeks have been hell on my condors. All my work for the last two years is undone.... I'm back to where I started.

I feel for you. My small trading account is our only account that was not affected, since I had all positions closed and in cash. I'll be watching closely in the morning, looking for buy opportunities. My Fidelity Equity acct value dropped, and I'd like to sell it to capture this year's profits, but selling that one is tricky since it only sells for whatever the price is at the end of the day. Several commentators are saying that we will likely see a quick rebound, if only temporary. This may be the norm until after the election; the Fed has become a political pawn.

I don't believe that this FED Board under Powell is political. They have stuck to their mission of low inflation and full employment, and their comments have been grounded in data. If they wanted to help Biden, they would have lowered rates a bit more quickly. I don't think they would be biased toward Trump.

If I were the FED, I'd be watching the markets and and indicators closely, with a bias toward lowering rates in September -- perhaps by a half point, instead of the "measured" quarter point.

In the meantime, the FED could buy back some bonds -- thus injecting more cash into the economy to mitigate recession fears. But this might trigger inflation before the economy grows away from recession. My guess is that the FED will strap in like the rest of us and see what's working after the rough road is behind us.

The FED does not mind the market much -- too emotional and volatile. They like to look at hard economic data.
===========================

The Reuters report makes sense. The Big Boys are moving the market beyond rational analysis. Let's all see where the dust settles.

You somehow posted while I was editing my earlier post, and removing the political Fed comment, which I still think is at least partly true btw, but no matter. I agree, we'll see where the dust settles.

[sweetandsour]

the index has dropped into "Extreme Fear" this morning.

Japan market is in a crash.

US market is in free fall. Think Wyle E. Coyote.

the last three weeks have been hell on my condors. All my work for the last two years is undone.... I'm back to where I started.

I feel for you. My small trading account is our only account that was not affected, since I had all positions closed and in cash. I'll be watching closely in the morning, looking for buy opportunities. My Fidelity Equity acct value dropped, and I'd like to sell it to capture this year's profits, but selling that one is tricky since it only sells for whatever the price is at the end of the day. Several commentators are saying that we will likely see a quick rebound, if only temporary. This may be the norm until after the election; the Fed has become a political pawn.

I don't believe that this FED Board under Powell is political. They have stuck to their mission of low inflation and full employment, and their comments have been grounded in data. If they wanted to help Biden, they would have lowered rates a bit more quickly. I don't think they would be biased toward Trump.

If I were the FED, I'd be watching the markets and and indicators closely, with a bias toward lowering rates in September -- perhaps by a half point, instead of the "measured" quarter point.

In the meantime, the FED could buy back some bonds -- thus injecting more cash into the economy to mitigate recession fears. But this might trigger inflation before the economy grows away from recession. My guess is that the FED will strap in like the rest of us and see what's working after the rough road is behind us.

The FED does not mind the market much -- too emotional and volatile. They like to look at hard economic data.
===========================

The Reuters report makes sense. The Big Boys are moving the market beyond rational analysis. Let's all see where the dust settles.

The Fed may or may not be interested in politics, but the politicians are interested in the Fed.

https://www.barrons.com/articles/trump- ... e=20240809

[Del]

The Fed may or may not be interested in politics, but the politicians are interested in the Fed.

https://www.barrons.com/articles/trump- ... e=20240809

This is nothing new. I remember when President George Bush the First complained that Alan Greenspan ("The most famous civil servant since Pontius Pilate") wasn't lowering rates fast enough during the 1992 election campaigns.

Just as the Supreme Court needs to be independent of Congress and the Executive branch, the Federal Reserve Board needs independence and space to do its job. If the Central Bank becomes political, then America becomes even more like China.

Of course, there are the jabberheads who complain about the Central Bank and argue for abolishing it, because they have no knowledge of history. High inflation and deep recessions used to be regular occurrences in 19th century economic history, along with frequent bank panics. But they had the gold standard then, which was a natural force toward equilibrium.
=============================

The President already "has a say" in the economy. President Biden signed a $1.9T covid relief act.... increasing the money supply by 36%, with no productivity to balance it. That's an economic tropical storm forming in the Atlantic, and there's bound to be cycles of inflation and recession in the forecast.

So basically we sent Captain Powell sailing into a typhoon, and now we want to blame him for taking on some water and spoiling some cargo? Without the FED, we would have sunk.

Every president since FDR signs deficit spending bills that compound our debt. The federal debt increases by $1 trillion every 100 days. That's $5,500 per tax payer. $11,000 per taxpaying family. Let Mr. Trump work on this.