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Dow Jones Stock Market 2018

Discussions about the economic and financial ramifications of PEAK OIL

Re: +21000 on the Dow

Unread postby GHung » Mon 05 Feb 2018, 18:19:08

Outcast_Searcher wrote:
GHung wrote:Blah, blah, blah

If you ever said anything worthwhile instead of ad-homming like a child, I'd be surprised.

You don't seem to know a damn thing about anything -- certainly not about me.


I know enough to consider all sides of an argument, and you're the king of ad-hom posting. Say thanks. As for knowing anything about you, I can tell a lot just from your regular ad-hom attacks on anyone you disagree with (should I provide a very long list?).

In your case, it's all I care to know.

Now go call me a doomer yet one more time. I've counted about a dozen so far. The next will be just as empty as the first.

BTW: You asked for data/evidence on another thread and ignored it when called on your BS. One more time - Do you really think $trillions of economic stimulus had nothing to do with supporting oil consumption at higher prices? Seems when I ask a logical question in regards to your claims, YOU CUT AND RUN. Then accuse me of not "knowing a damn thing about anything".

Yet again: Do you really think $trillions of economic stimulus had nothing at all to do with maintaining oil consumption at higher prices, and other levels of consumption for that matter? Since you accused me of being a "doomer" (again) because I mentioned debt, I assume you can't give an honest answer.
Last edited by GHung on Mon 05 Feb 2018, 18:35:38, edited 1 time in total.
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Re: +21000 on the Dow

Unread postby GHung » Mon 05 Feb 2018, 18:34:18

Cog wrote:
onlooker wrote:When interest rates are set to rise, I would run for the exit.


You mean like the FED three rates rises we had in 2017 and the market went up 6000 points? Is that the rise you were referring to. LOL


You call those interest rate increases? I call that chicken shit. Sort of like giving someone 25 cents more an hour and calling it a raise. Interest rates averaged 5.75% from 1971-2017.

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Matters little to me since I don't do usury. Besides, when the Feds let Equifax off the hook (as they did today) for losing virtually ALL of our important info, I lock that bad boy down. Hard to think that some of us can do just fine without contributing to their debt schemes, eh? Meanwhile, I pull a Trump and sue.
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Re: +21000 on the Dow

Unread postby rockdoc123 » Mon 05 Feb 2018, 18:57:17

Good buying opportunity was offered today and I took it.


agree, some seriously strong companies out there such as Raytheon and Lockheed Martin which took a 4.5% haircut today. This after a very long climb as a product of good corporate performance.

Saw a quote today that 100% of 10% falls in the market have been followed by much higher highs. This is why they call it a correction.
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Re: +21000 on the Dow

Unread postby GHung » Mon 05 Feb 2018, 19:07:06

rockdoc123 wrote:
Good buying opportunity was offered today and I took it.


agree, some seriously strong companies out there such as Raytheon and Lockheed Martin which took a 4.5% haircut today. This after a very long climb as a product of good corporate performance.

Saw a quote today that 100% of 10% falls in the market have been followed by much higher highs. This is why they call it a correction.


Yep. Your tax dollars at work. Those MIC stocks should do pretty well if Trump gets his military spending increase, and especially if he gets his war.
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Re: +21000 on the Dow

Unread postby Cog » Mon 05 Feb 2018, 19:18:50

You should short stocks if you are that confident about a stock market crash GHung.
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Re: +21000 on the Dow

Unread postby onlooker » Mon 05 Feb 2018, 19:25:23

so Cog since you know a lot about the Market I take it this is just a correction right? So what constitutes a Crash? Just curious
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Re: +21000 on the Dow

Unread postby onlooker » Mon 05 Feb 2018, 20:08:30

The rout oops correction is continuing in the Asian markets as per Bloomberg news
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Re: +21000 on the Dow

Unread postby Cog » Mon 05 Feb 2018, 20:50:36

onlooker wrote:so Cog since you know a lot about the Market I take it this is just a correction right? So what constitutes a Crash? Just curious


Depends on who you talk to but a 10% correction on a index like the Dow could be considered a crash. A correction of 10% over a few days or weeks is a correction. Now people get the mistaken idea that a crash means the value of stocks go to zero and the sky is filled with brokers jumping out of high rises. We have had several "crashes" since 1929 but here we are.
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Re: +21000 on the Dow

Unread postby Cog » Mon 05 Feb 2018, 20:56:15

onlooker wrote:The rout oops correction is continuing in the Asian markets as per Bloomberg news


If you thought this little drop was bad, you should have been around in 2008 time frame. The wails of the doomers reached fever pitch. Doomers here were telling everyone sell, sell, sell. Had they only held on a couple more years they would have seen nine years of growth instead of locking in their losses. Even Cog was a doomer back then since it looked pretty convincing we were in a very bad way. Copious Abundance was one of the few voice of reason back then who said we weren't done for.

I didn't sell my stocks back then, but it did convince me to get out of debt as rapidly as possible because the people who suffered back then had huge mortgages and credit card debt. Not a good place to be if you lose your job during a recession.
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Re: +21000 on the Dow

Unread postby baha » Mon 05 Feb 2018, 21:38:38

I remember 2008 well COG. I was debt free living in an RV in my dad's backyard and growing vegetables. I remember how I felt outside of it all. I was already unemployed and stayed that way for two more years.

It impressed on me the value of being debt free. And the control it gives you. I am again debt free and I have plenty of popcorn :)

If someone will call the bottom I will buy in.
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Re: +21000 on the Dow

Unread postby asg70 » Mon 05 Feb 2018, 22:01:27

onlooker wrote:what constitutes a Crash?


In the context of this site, as it's been so often comically described, it requires this:

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“If and when the oil price skewers for 6 months or more substantially above the MAP, then I will concede the Etp is inherently flawed"
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Re: +21000 on the Dow

Unread postby Outcast_Searcher » Mon 05 Feb 2018, 23:00:27

Cog wrote:I didn't sell my stocks back then, but it did convince me to get out of debt as rapidly as possible because the people who suffered back then had huge mortgages and credit card debt. Not a good place to be if you lose your job during a recession.

If you don't have debt and don't trade on margin, these things can certainly sting a lot but you can't get killed.

I remember consoling a friend of mine in the winter of 2008-2009 who had recently retired and was understandably concerned.

Look, I told her. Think about it. You have no debt. You and your husband own your house and your cars. You have investments and pensions that pay you a steady cash flow. You can live on significantly less than that cash flow if needed. So if things get tight you can give up discretionary spending like international flights for exotic vacations for a year or three. No big deal.

Now, look at the average American. Mired in plenty of debt. Big mortage, don't own their cars unless they're old. Not that many investment assets, so little cash flow outside their jobs. If things get really bad and they lose their jobs, they could lose literally everything. THOSE people have reason to worry if this turns ugly. Unless the financial system literally completely collapses, people with assets and no debt don't have that kind of worry.

It's too bad so many people have to learn the hard way. I wonder how many people burned by margin accounts in 1999 and/or 2008/9 and said "never again" couldn't resist and are sitting on a similar situation.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: +21000 on the Dow

Unread postby Cog » Mon 05 Feb 2018, 23:19:22

Since we do have recession about every ten years or so its very important to always be aware of your financial condition and how safe your job is to weather one. Most people don't do this it completely shocks them when they lose it all, even when they had a good paying job. Debt can be useful but its also a trap that limits your options.

I caught a good break during the last recession since our firm pretty much did only government contracts and those were funded years before the recession hit. Other engineering firms that worked mostly in the private sector had huge layoffs. Wasn't pleasant for them.

But as far as this correction leading to a recession, I'm not seeing it. Market may slide down some more but this isn't 2007 with all the factors in play then.
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Re: +21000 on the Dow

Unread postby evilgenius » Tue 06 Feb 2018, 00:00:42

You could see interest rates rising, in the form of bond yields, for a while. Now that stocks have been clobbered, and people are afraid, bond yields have begun to go down again. I think that must be because people don't prefer to be in cash, but bonds. They at least get paid something to be in bonds while they get nothing for being in cash. They are buying bonds and lowering the yield. It's an interesting bit of movement because it is happening quickly. I've heard people talk about this sort of correction, but they all thought it would play out over a longer time, and not be so powerful.

One of the things I've been looking at are stocks that rely upon dividends to attract investors. I like a stock that pays a dividend, but not one that relies upon paying one to attract me. There are different levels of dividend payout too. Some stocks might pay six or seven percent. Others might pay closer to ten. Those both are more into attracting with yield than potential growth. Some have the business model to back that up and some are posers. Anyway, all of the ones I've been watching have been pricing in about a two percent rise in rates, so far. That is to say that their share prices have fallen by enough so that the yield they pay has gone up by about two percent. I wonder if the order of things will correct that much, perhaps over time?

Bonds would have to get cheaper for rates to go up. That could happen if people got their confidence back and put their money in stocks again. It could also happen if they put their money somewhere else. I don't know where that else would be right now. It could be into the economy in general, if people wind up scared off of stocks. That could raise the inflation bogeyman. For all the volatility this could just be a kind of iterative move, so that things can realign upon a higher rate structure. It could also be the prelude to something worse. I guess we'll just have to see.
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Re: +21000 on the Dow

Unread postby EdwinSm » Tue 06 Feb 2018, 01:52:10

While in my opinion a "correction" was long over due, it seems a bit too early to say whether this is just a "correction" or the beginnings of a crash. As the indexes are still way way up over this time last year I guess we will have to wait a few more days to see if it bottoms out soon. But the initial down side seems a bit like a cliff:
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Re: +21000 on the Dow

Unread postby tita » Tue 06 Feb 2018, 04:16:07

EdwinSm wrote:While in my opinion a "correction" was long over due, it seems a bit too early to say whether this is just a "correction" or the beginnings of a crash. As the indexes are still way way up over this time last year I guess we will have to wait a few more days to see if it bottoms out soon. But the initial down side seems a bit like a cliff:
Image

And if you look at the Dow Jones on a longer period, you realize that between nov 2016 and jan 2018 (a little more than a year), the index grew by almost 50% (18'000 to 26'500).

There is quite some room for a deeper correction. What is surprising is how fast it is happening... But the problem was how fast the index grew up in 2017. We are just returning to the reality.
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Re: +21000 on the Dow

Unread postby Newfie » Tue 06 Feb 2018, 11:07:04

I had my broker disengage from the market a few months back. Take a safe position. It will be interesting to see how well he has done for me.

Cog, my position was similar. Working in transit was somewhat recession proof as in a recession the government puts money into public works to reinvigorate the economy. I was never laid off. But some of that was me. At one job, Fischback and Moore (Ala Milken and Posner) the company was going down the tubes, I survived 3 Black Thursday purges and was paid 1-1/2 my last few weeks just to stay a bit longer.
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Re: +21000 on the Dow

Unread postby GoghGoner » Wed 07 Feb 2018, 11:13:25

Always amazes me how complex these financial instruments can be.

http://www.cmlviz.com/cmld3b/index.php?number=11930&app=news&cml_article_id=20180206_the-astonishing-story-behind-what-really-happened-to-xiv

It's a reminder that the real danger to a portfolio is not a bear market -- we recover from those quite nicely as a nation -- it's the delirium that happens when a bull market gets totally out of control and margin is used excessively in a spurt of just a few days. And by margin, we don't mean normal, everyday investors, we mean the institutions -- even the ones we entrust to be custodians of our investments.

So that's it. XIV likely would have done just fine after this moment in time in the market, will not be given that opportunity to recover. It has been blown out on the heels of yet another Wall Street debacle, which no one seems to even understand, yet.
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Re: +21000 on the Dow

Unread postby Outcast_Searcher » Wed 07 Feb 2018, 13:41:20

tita wrote:What is surprising is how fast it is happening... But the problem was how fast the index grew up in 2017. We are just returning to the reality.

I saw one video clip (on CNBC, I think) late yesterday that accounted for why the market might have fallen so quickly this time. It is simple, and therefore seems reasonable (Occam's Razor). And it fits with your perspective on how fast the market has been rising lately.

The idea was that with active traders, there are a LOT of trend followers once a market moves up so far so fast. So many of these people were likely trading with fairly tight stops and just saying "I'll ride it up, but once it breaks down a bit, I'm out". Once it moved down meaningfully and a large number of such traders got stopped out, the trickle of such selling moves toward an avalanche once the HFT machines notice and add to the selling.

As obvious as this seems, I don't see how this helps active traders make money though. We can't be sure it's right. We can't know if and when that behavior will happen next, even if that theory is right. I'm sure many technicians riding the hindsight horse will disagree, but I'm unimpressed until they can beat the index funds AFTER expenses a majority of the time over a multi-decade timeframe. Thus far, they almost never can.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Dow Jones Stock Market 2018

Unread postby Outcast_Searcher » Wed 07 Feb 2018, 13:48:03

Something I noticed last night and carried into today. Since Friday, crypto-currencies have generally been trading in correlation with the US stock market (day to day, anyway).

Coincidence, or a statement of overall confidence?

I hadn't really thought of crypto-currencies generally reflecting global stock market exuberance in 2017 overall. I'd assumed that was a completely different thing.

I suppose this adds to the evidence that much or even almost all crypto trading might just be short term speculation, instead of some core belief that (for example) Bitcoin will change the financial world -- mirroring the basic idealism of, say, big time Tesla fans.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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