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+21000 on the Dow

Discussions about the economic and financial ramifications of PEAK OIL

Re: +21000 on the Dow

Unread postby Outcast_Searcher » Mon 17 Jul 2017, 15:10:55

pstarr wrote:Seeking Alpha, Jul. 4, 2017 10:06 AM ET: The Shiller P/E Is Misleading? In A Word, No!
So its true that the stock market will crash as it did in 1929, 2000, and more recently in 2008. But this time it will be different. It won't come back 8O


And will you pay the non perma-doomers when you're wrong, AGAIN? (Since you ludicrously claimed we should be paying you upthread? (As if we should pay you for frequent incorrect predictions...)

When are you forecasting this happens? Will you admit you're wrong when the market doesn't "crash" when you predict?

Have you ever admitted when you were wrong over the past decade and economic doom didn't enfold humanity and crush it?

Why on earth should we believe THIS TIME (if the market actually crashes vs. a normal correction in the next few years) "it won't come back"? Due to your constant wrong calls?
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Re: +21000 on the Dow

Unread postby asg70 » Mon 17 Jul 2017, 15:25:04

Outcast_Searcher wrote:Why on earth should we believe THIS TIME


Because he's invested tens of thousands of hours into peakoil.com. The cosmos owes him doom now.

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Re: +21000 on the Dow

Unread postby pstarr » Mon 17 Jul 2017, 15:32:07

So Outcast_Searcher, why not review the argument in the link above regarding P/E instead of the cheap shots and insults. You always claim to be the rational one so you should understand my request for payment was joke?

BTW: what poor predictions? Got date?
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Re: +21000 on the Dow

Unread postby Outcast_Searcher » Mon 17 Jul 2017, 17:47:37

pstarr wrote:So Outcast_Searcher, why not review the argument in the link above regarding P/E instead of the cheap shots and insults. You always claim to be the rational one so you should understand my request for payment was joke?

BTW: what poor predictions? Got date?

I'm not going to waste a bunch of time going through your many erroneous past posts to find a few examples. If you want to pretend you are never predicting economic doom, enjoy yourself. I'll assume the vast majority of folks here have a better memory than that.

But just from memory, you have claimed Tesla is a farce/fraud a number of times, that EV's can't work, etc.

How many hundred thousand Tesla's being driven daily does it take you to admit you were wrong on that one? How many millions? (It looks highly probable we'll have millions on the road within the next 5 years, or perhaps less).

Or are you going to claim you never said that, to make me do some searches?
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Re: +21000 on the Dow

Unread postby asg70 » Mon 17 Jul 2017, 18:31:03

Outcast_Searcher wrote:Or are you going to claim you never said that, to make me do some searches?


He'll claim he was just "joking". That seems to be his go-to excuse when his back is against the wall.

After all, he fashions himself somewhat of an heir to the throne of George Carlin's cynical throne.
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Re: +21000 on the Dow

Unread postby EdwinSm » Wed 19 Jul 2017, 08:21:15

It is interesting that the resident Aunty Doomers (oops, should I have written Anti-Doomers? :P ) are willing to attack Pstarr for saying that an elevate R/E ratio will lead to a collapse, but not one of them has addressed the point of the P/E ratio.

There could be an argument that the ratios are not too high, but if there is a bubble somehow the excess will have to disperse - so will it be a Crash, or a slow long drawn out leak, or are we (like the claim in the 1990s :shock: ) living in a new dynamic where past economic lessons no longer apply?
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Re: +21000 on the Dow

Unread postby Cog » Wed 19 Jul 2017, 09:38:53

Depends on how a doomer defines a crash. The recession of 2007-2009 was deep and painful but it wasn't a crash in my mind. A big correction no doubt but if you didn't dump your stocks, as many of the doomers told you to do, you recovered your value and then some. Or you saw 2009 as the buying opportunity of all time.

Company profits are up right now, banks and tech anyway. Oil is down for now but they pay some decent dividends so I can wait until oil prices rise and take the stock price up with them.

To hear ETP'ers tell it the next stock market crash will result in the value of everything going to zero, Mad Max in the street, and we all starve or resort to cannibalism.
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Re: +21000 on the Dow

Unread postby Outcast_Searcher » Wed 19 Jul 2017, 11:12:06

EdwinSm wrote:It is interesting that the resident Aunty Doomers (oops, should I have written Anti-Doomers? :P ) are willing to attack Pstarr for saying that an elevate R/E ratio will lead to a collapse, but not one of them has addressed the point of the P/E ratio.

There could be an argument that the ratios are not too high, but if there is a bubble somehow the excess will have to disperse - so will it be a Crash, or a slow long drawn out leak, or are we (like the claim in the 1990s :shock: ) living in a new dynamic where past economic lessons no longer apply?

SINCE WHEN is a typical stock market correction or bear market ANYTHING approaching "crash"?

(And using the word "collapse" instead of "crash" for high PE's deserves criticism. If pstarr doesn't like that, he should stop with the hyperbole).

Even corrections involving a meaningful pullback in the stock market aren't a crash, if they last for years. They're no fun for bulls, but during the latter months of them they tend to be a great buying opportunity. And even if we have a "crash" of 25% or so, so what? It's not the end of the world. A stock market INVESTOR needs to be prepared to accept several such crashes over a career of investing, or they shouldn't be in stocks.

And this is one good reason for diversification. (I tend to only have about half my investments in stocks. It helps me sleep much better, and I can live with the lower returns. Everyone has to decide this for themselves. (Best NOT to learn this at the bottom of a crash)). For example, the current clown in the white house AND US stock market valuations caused me to shift a meaningful chunk of my stocks from US stocks to international stocks in 1Q17, given my perceived risk/reward. (Even though this meant taking a significant capital gain, and having to pay an estimated 21% income tax on those gains in state and local taxes. And I harvested some offsetting losses in some commodity stocks (like copper) I've held as an inflation hedge. After all, I can always buy those back at low prices after the wash sale window). With average holding times in the decades, an investor (as opposed to speculator) can do some productive (and very legal) tax planning.

Or are you going to tell us the P/E ratios, etc. are way too high in, say, European and developing markets (generally) too? (Because that isn't credible, IMO).


Edit: Corrected earlier mistake, as I somehow misread "Crash" as collapse.

Edits: Corrected a bunch of minor typos and errors, such as my likely total capital gains tax rate for TY 2017.
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Re: +21000 on the Dow

Unread postby pstarr » Wed 19 Jul 2017, 11:59:30

Outcast_Searcher wrote:
pstarr wrote:So Outcast_Searcher, why not review the argument in the link above regarding P/E instead of the cheap shots and insults. You always claim to be the rational one so you should understand my request for payment was joke?

BTW: what poor predictions? Got date?

I'm not going to waste a bunch of time going through your many erroneous past posts to find a few examples. If you want to pretend you are never predicting economic doom, enjoy yourself. I'll assume the vast majority of folks here have a better memory than that.

But just from memory, you have claimed Tesla is a farce/fraud a number of times, that EV's can't work, etc.

How many hundred thousand Tesla's being driven daily does it take you to admit you were wrong on that one? How many millions? (It looks highly probable we'll have millions on the road within the next 5 years, or perhaps less).

Or are you going to claim you never said that, to make me do some searches?
P/E is now stupendously out of wack. This same preceded the greatest stock market crashes of the 20th and 21st century. Is that not the case?

This extraordinary valuation is not justified by the potential earnings of one company. Tesla is just an electric car company, one among many. But unlike the rest it not diversified. The Mitsubishi Group not only makes the i-MiEV (a reputable little city/suburban vehicle at $22,995) but it also manufactures air conditioners, aircraft, automotive components, forklift trucks, hydraulic equipment, machine tools, missiles, power generation equipment, ships, and space launch vehicles. With a the ongoing oil supply glut, there has been no rapid transition to EV's. And with economic contraction folks would choose the little very un-kewl MiEV.

But that is irrelevant to the larger question: what about today's economy justifies such irrational exuberance in the larger overall stock market? Your attack on me as usual is personal and irrational. Not a response.
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Re: +21000 on the Dow

Unread postby asg70 » Wed 19 Jul 2017, 12:12:40

pstarr wrote:Tesla is just an electric car company, one among many. But unlike the rest it not diversified.


Tesla is diversified. It handles stationary storage and solar. Is the company mature? No. But it is not a one-trick-pony.

pstarr wrote:With a the ongoing oil supply glut


I thought there was no glut, just "demand dearth" as you call it. Watch it. Your narrative is slipping.
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Re: +21000 on the Dow

Unread postby Cog » Wed 19 Jul 2017, 13:08:57

LOL good catch on the oil glut. ETP'ers have been claiming there is no oil glut for 15 threads now. In their mind, no one can afford to buy the oil at current price.
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Re: +21000 on the Dow

Unread postby pstarr » Wed 19 Jul 2017, 13:26:46

asg70, Cog for sake of this thread lets assume this issue has nothing to do with ETP. So if you two can get over your obsession for just one moment, and keep focused, then maybe we can have an intelligent discussion.

Yes there are many factors that affect the stock market. We know that speculation, normal business cycles, currency moves etc are relevant. We do. But what about P/E? Have we moved beyond that? Is this the Singularity? Are we now immune to normal historical warnings?
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Re: +21000 on the Dow

Unread postby pstarr » Wed 19 Jul 2017, 14:55:27

Some here claim the FED is able to pump beyond fundamentals, can prop up the market forever. Really? I say the herd, the active Investors (as opposed to the passive kind, the funds, retirement pools etc) are the same folks who have always been rightly concerned with performance and especially things like debt. Yes, they have no where to park their money at current low interest rates. That's obviously driving the market. There is no where else to go. But . . .

Mom and Pop may not understand techie stuff, but they sure get over-valuation. Do we really believe they can't see through ridiculous Facebook/Tesla valuations? If and when they bail . . what happens?
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Re: +21000 on the Dow

Unread postby Ibon » Wed 19 Jul 2017, 15:03:35

pstarr wrote: Do we really believe they can't see through ridiculous Facebook/Tesla valuations? If and when they bail . . what happens?


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Re: +21000 on the Dow

Unread postby pstarr » Wed 19 Jul 2017, 15:14:00

Ibon wrote:
pstarr wrote: Do we really believe they can't see through ridiculous Facebook/Tesla valuations? If and when they bail . . what happens?


We learn to play dominoes together under the shade of a big tree in the hot afternoon sun waiting for the cool of the evening.

Me too. But as I just noted in another thread, I have also begun to feverishly complete my Suburban Doomstead. I built a good strong secure chicken coop four years ago with remaining wood from my sustainable tree harvest here on the property. Never bothered to populate it with chickens or even add the finishing touches. Was awaiting doom. No longer 8O

I am now building the nesting boxes, having completed the installation of an automatic time-of-day/temperature controlled entry door. Still need to put in water and feed delivery systems. It will be the best. :) And driven by my solar panels and deep water pump.
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Re: +21000 on the Dow

Unread postby Outcast_Searcher » Wed 19 Jul 2017, 16:23:34

Ibon wrote:
pstarr wrote: Do we really believe they can't see through ridiculous Facebook/Tesla valuations? If and when they bail . . what happens?


We learn to play dominoes together under the shade of a big tree in the hot afternoon sun waiting for the cool of the evening.

Did anyone credible EVER guarantee that stocks of companies like Tesla or Facebook can't go down?

I don't think so.

What happens when such stocks fall? Speculators lose money. Investors lose money relative to the previous peak (but not necessarily where they bought the stock.

But does the world end? Does the economy implode? No. I wouldn't want to face a Great Depression scale event with all the debt, but even that wouldn't be total system collapse.

Tesla stock going down is a big problem? Don't make me laugh.
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Re: +21000 on the Dow

Unread postby Cog » Wed 19 Jul 2017, 19:18:04

Going back to what pstarr talked about. I do look at the P/E ratio and how a company's profits have done over the years. As a consequence, I have not invested in stocks like Tesla, Facebook, or even Amazon. I got burnt by the tech bubble in 2001 and said never again. Now that has resulted in me losing out on some fantastic gains in that sector but I'll stick with companies that slowly build profitability over long time horizons. We are talking decades. High dividends paid out over a long time period.

With my playing around investment money, I look for a good stock that is near 52 week lows but is otherwise a solid company. I'll try to buy it there and hold it until I can get an adequate profit and then dump it. That may take a week or it might take a month.

People take a crap on CNBC's Kramer because of his bad calls during the last recession. He earns some of that criticism and has owned up to it. But he wrote a book called "Get Rich Carefully". Its a good read on market timing and how to pick stocks for the long term.
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Re: +21000 on the Dow

Unread postby Outcast_Searcher » Wed 19 Jul 2017, 19:33:25

Cog wrote:Going back to what pstarr talked about. I do look at the P/E ratio and how a company's profits have done over the years. As a consequence, I have not invested in stocks like Tesla, Facebook, or even Amazon. I got burnt by the tech bubble in 2001 and said never again. Now that has resulted in me losing out on some fantastic gains in that sector but I'll stick with companies that slowly build profitability over long time horizons. We are talking decades. High dividends paid out over a long time period.

I agree completely. I'm terrified of speculative stocks with monster (or infinite) PE's, and stay away.

All I'm saying is if such stocks collapse in a bad stock market, it does not mean some kind of collapse or general economic system failure, as pstarr seems to be trying to imply (as doomers will).
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Re: +21000 on the Dow

Unread postby Cog » Wed 19 Jul 2017, 19:44:39

Twitter is a good example of a stock that flew high for a while after its IPO. My father made some money on it but he was too heavy in it. I got him out of it before it turned into a disaster for him. They just don't have a profitable model and companies that don't should rightly scare you. Snapchat is another one that makes no sense to me.
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Re: +21000 on the Dow

Unread postby pstarr » Wed 19 Jul 2017, 20:39:14

Outcast_Searcher wrote:
Cog wrote:Going back to what pstarr talked about. I do look at the P/E ratio and how a company's profits have done over the years. As a consequence, I have not invested in stocks like Tesla, Facebook, or even Amazon. I got burnt by the tech bubble in 2001 and said never again. Now that has resulted in me losing out on some fantastic gains in that sector but I'll stick with companies that slowly build profitability over long time horizons. We are talking decades. High dividends paid out over a long time period.

I agree completely. I'm terrified of speculative stocks with monster (or infinite) PE's, and stay away.

All I'm saying is if such stocks collapse in a bad stock market, it does not mean some kind of collapse or general economic system failure, as pstarr seems to be trying to imply (as doomers will).

Once again,you extrapolate. Classic reactionary thinking way inside the box. By reacting only to your own preconceptions (having deemed me a 'doomer') you feel free to ignore crazy P/E.

At your own risk. Surf on, dude. The sun always shines. :)
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