Getbig PHD Economists, help explain something to me.

[Mr Anabolic]

Timing is everything and the boiling frog principle applies. Also, the saying something along the lines of "they can keep the game going longer than you can remain solvent" comes to mind.

In other news the NAR says last month there were record contracts in place for housing purchases. Note that's not closings but offers... Where I am there is no inventory at all outside the city. I sold one in 3 days when all this Covid stuff started, which was a surprise. Tons of new builds going up, any lot that can be bought is being built on...about 30 miles away from center a major metro. I wonder how much retirement money is flowing into these purchases.

NAR is well known for their blatant pumping... fudging building permits and housing sales numbers. 

Commercial RE is finished... over... done... kaput. 

After November (no matter who is POTUS) anyone that lives in/near a major metro is going to to be ground into chop meat.  It will make the current riots look like a Sunday picnic. 

I'll say it again...

Regardless of where you live, if you don't have your guns and ammo now, you better get it.  The most common ammo is 9mm... the price for a 1000rd case of FMJs is currently averaging $800-1000.  The gun and ammo prices will not be coming back to pre-George Floyd levels... not ever. 

[loco]

NAR is well known for their blatant pumping... fudging building permits and housing sales numbers. 

Commercial RE is finished... over... done... kaput. 

After November (no matter who is POTUS) anyone that lives in/near a major metro is going to to be ground into chop meat.  It will make the current riots look like a Sunday picnic. 

I'll say it again...

Regardless of where you live, if you don't have your guns and ammo now, you better get it.  The most common ammo is 9mm... the price for a 1000rd case of FMJs is currently averaging around $1000.  The gun and ammo prices will not be coming back to post-George Floyd levels... not ever.

Saved for posterity.

[loco]

Your questions are completely rhetorical... that's why.  You are also brain locked.  I cannot help you.

Whatever you say, Mr prepper.

[Mr Anabolic]

Saved for posterity.

Fine.  We'll re-visit a year from now.  Liver or crow?... your choice.

[Mr Anabolic]

Whatever you say, Mr prepper.

This is all you got? - lol   

I'm taking up premium parking space in your head.   

[IroNat]

Works both ways.  I made a ton of $ shorting the market in March.   I guess the markets ONLY go up - lol

Having insurance is a good thing... I'm sure Mr LEGENDARY Lynch would agree with that.

You're more of a speculator than an investor.

Not that there's anything inherently wrong with that but there is a difference.

I congratulate you on your successful speculations.

https://en.wikipedia.org/wiki/Speculation

"Speculation is the purchase of an asset with the hope that it will become more valuable in the near future. In finance, speculation is also the practice of engaging in risky financial transactions in an attempt to profit from short term fluctuations in the market value of a tradable financial instrument—rather than attempting to profit from the underlying financial attributes embodied in the instrument such as value addition, return on investment, or dividends."

[loco]

This is all you got? - lol   

I'm taking up premium parking space in your head.   

I thought you'd be flattered.   

[IroNat]

Here's a strategy I use to measure my tolerance for risk.  I call it the "Black Swan Defense".

Feel free to use it but be forewarned it is copyrighted by me and I will sue. 

A Black Swan Event would be 50% overall drop in the stock market.  Why 50%?  It's just an estimate and you have to start somewhere.

I'm not anticipating the end of civilization.

I take the 3 financial investments categories (not including real estate or other stuff) which are cash, bonds, and stock.

Example:

Cash $100,000
Bonds $400,000
Stocks $500,000
Total $1,000,000

Black Swan Event = Cash + Bonds + 1/2(stock)

In the above example this would be $100k + $400k + 1/2($500k) = $750,000

So, in the event of a Black Swan Event my stock values are cut in half.

Would I still be ok if that happened?  Can I continue my current lifestyle?

If I would be ok then my asset allocation is good. 

If such a drop makes me queasy then I need to have more cash/bonds and less stocks.

[Flexacon]

All futures profits are taxed according to the 60/40 rule, i.e. 60% of profits are taxed as long term capital gains and 40% are taxed as short term capital gains.  After all is said and done I pay approx 23-25% tax on all futures and options trades. 

Stocks are taxed at the highest tax rate.  I stopped trading stocks about 10 years ago.

BTW, I took $100K of the March profits and bought more silver when it hit $12 at the end of March... what a gift that was   

Us silver loving fags are looking better than a 10 inch circumcised shaft at a truck stop glory hole.

Silver ain't done yet either. It should reach at least reach triple what you paid for it.

[loco]

Here's a strategy I use to measure my tolerance for risk.  I call it the "Black Swan Defense".

Feel free to use it but be forewarned it is copyrighted by me and I will sue. 

A Black Swan Event would be 50% overall drop in the stock market.  Why 50%?  It's just an estimate and you have to start somewhere.

I'm not anticipating the end of civilization.

I take the 3 financial investments categories (not including real estate or other stuff) which are cash, bonds, and stock.

Example:

Cash $100,000
Bonds $400,000
Stocks $500,000
Total $1,000,000

Black Swan Event = Cash + Bonds + 1/2(stock)

In the above example this would be $100k + $400k + 1/2($500k) = $750,000

So, in the event of a Black Swan Event my stock holds are cut in half.

Would I still be ok if that happened?  Can I continue my current lifestyle?

If I would be ok then my asset allocation is good. 

If such a drop makes me queasy then I need to have more cash/bonds and less stocks.

Great strategy, and similar to what many passive investors and retirees follow.  Some call it the bucket strategy.

This is the reason why I asked Mr Prepper earlier what exactly he meant by what happened to all retirees who had 401K and or IRAs in 2008, but he declined to answer.

If these retirees had bothered to do a little research, learned of these simple strategies and applied them, then they were just fine.  And I know for a fact that many retirees invested in the stock market were just fine in 2008, and actually increased their net worth significantly by 2010 thanks to opportunities created by the 2008 crash and the fail safe strategies they had in place.

[loco]

NAR is well known for their blatant pumping... fudging building permits and housing sales numbers. 

Commercial RE is finished... over... done... kaput. 

After November (no matter who is POTUS) anyone that lives in/near a major metro is going to to be ground into chop meat.  It will make the current riots look like a Sunday picnic. 

I'll say it again...

Regardless of where you live, if you don't have your guns and ammo now, you better get it.  The most common ammo is 9mm... the price for a 1000rd case of FMJs is currently averaging $800-1000.  The gun and ammo prices will not be coming back to pre-George Floyd levels... not ever.

This post didn't age well.

Saved for posterity.

Fine.  We'll re-visit a year from now.  Liver or crow?... your choice.

[nerdoldnerdith]

Economists claim that we are in a recession, yet the stock market is at a record high, a bunch of companies are trading at record highs and have gone buckwild during this so called recession and the housing market is booming, even higher than during the bank scam from 2005-2008.  How is this all possible?

Can you really have a recession, record unemployment, an economy on the brink of a depression yet have record house prices and record stock market?

Something seriously shady is going on and this whole house of cards is going to tumble soon. Are these economists going to claim they didn't see this coming?

Yes. The simple answer is that we are in an inflationary depression. That is where the economy gets worse because the currency rapidly devalues, everything becomes more expensive without people getting richer, and people lose faith in the system.

The other kind of depression with which Americans are most familiar is a deflationary depression. That is where the value of money stays the same or even increases, but there is no optimism in the system, so people don't want to hire, work, innovate, create new wealth, etc. Everything loses value and the economy as a whole becomes worth less.

They are really two sides of the same coin. You get an inflationary depression like we have when governments and banks try to plug the leak with fiat money.

[IroNat]

I will again offer my theory:

The stock market remains high because there are no better alternative investments for this type of investors.

[Mayday]

Yes. The simple answer is that we are in an inflationary depression. That is where the economy gets worse because the currency rapidly devalues, everything becomes more expensive without people getting richer, and people lose faith in the system.

The other kind of depression with which Americans are most familiar is a deflationary depression.

You get an inflationary depression like we have when governments and banks try to plug the leak with fiat money.

We are in a deflationary depression my man which is causing massive wage deflation but people are seeing it as inflation.

An inflationary outcome always requires a deflationary event to kick off the process because that is how you justify ungodly amounts of debt and eventual currency printing.

Prices going up is linked to a decrease in productivity, product shortages, lowering volume and speculation increasing COGS. Our consumer world is modeled off large volume and razor thin margins. When we suffer a volume drop we can't survive on the existing pricing and discount models and so prices must go up or we all go broke.

It looks like inflation but it ain't. I'll use fuel as an example. Here the price has flown up to record highs yet nobody is driving. We're all locked down. Oil was $147/barrel in 2008 and it recently hit $75 or so and then puked down to $61 yet fuel is at record high..... why? lack of volume. The fuel companies can't survive on 0.01/L margin because there is no volume so they jack it up to 0.15/L to cover basic OPEX.

So it's not that prices are inflating due to currency devaluation, it's that your WAGES are deflating and you are seeing prices go up. Hence right now we are at the greatest risk of losing jobs, losing work hours.

The outcome of this is hyperinflation but we will experience total and complete deflationary hell before we get there.

[Body-Buildah]

Would hate to be a young couple trying to buy a house these days, retard prices.
I bought my first house in 1990/91, a 4-BR Garrison on 3-acres, 105K. Of course we were 24 year old kids with jobs that paid like $10.00 at the time , but it was still doable.
(With only 10K down).

These days its nuts.

[Mayday]

Would hate to be a young couple trying to buy a house these days, retard prices.
I bought my first house in 1990/91, a 4-BR Garrison on 3-acres, 105K. Of course we were 24 year old kids with jobs that paid like $10.00 at the time , but it was still doable.
(With only 10K down).

These days its nuts.

We know the outcome of high property prices.

People don't get married and don't have kids because it's too expensive. Western world has deflation of the population, why do you think Europe is getting in boatloads of Africans? It's to fight depopulation because we are all so fucked up with debt that people have 1 kid and suddenly BAM your population halves in 40yrs time.

It's easier to fix than people think but the wealthy won't allow it to be fixed. I think the only alternative is push the remote work policy which allows people to live outside these crazy expensive areas.

[Body-Buildah]

We know the outcome of high property prices.

People don't get married and don't have kids because it's too expensive. Western world has deflation of the population, why do you think Europe is getting in boatloads of Africans? It's to fight depopulation because we are all so fucked up with debt that people have 1 kid and suddenly BAM your population halves in 40yrs time.

It's easier to fix than people think but the wealthy won't allow it to be fixed. I think the only alternative is push the remote work policy which allows people to live outside these crazy expensive areas.

Sucks being old (55) but glad I came up when I did. No social media, no fake-news, no extreme right vs. left, etc.

Sports were sports (not whiny activist platforms), there was no fake music like rap (70's Hard Rock and 80's Metal) girls had big-hair and small asses.

New ghey world we got going today.

[MAXX]

My feeling is that the middle class and above, today, more so than in history, are using index funds as banks. Just to be able to beat inflation.

This is why we see stock market go up today, even in times of recession/lower productivity. Because people don't want their money to whittle away from inflation. This will continue to increase, to the point that most people use the stock market as investment, instead of FIAT in banks.

Or untill the point that a more viable(less volatile) crypto comes along that the general population feels secure putting savings in.

[epic is back]

funny to watch the robinhood commercials showing people like melvin

color of peace

[Mayday]

My feeling is that the middle class and above, today, more so than in history, are using index funds as banks. Just to be able to beat inflation.

This is why we see stock market go up today, even in times of recession/lower productivity. Because people don't want their money to whittle away from inflation. This will continue to increase, to the point that most people use the stock market as investment, instead of FIAT in banks.

Or untill the point that a more viable(less volatile) crypto comes along that the general population feels secure putting savings in.

Sharemarket goes up because they are pumping 120B/mth of QE into it LOL. It has absolutely zero to do with what the retail public are doing.

Retail people increased savings, paid off personal debt then leveraged themselves to the eyeballs to buy a home in the suburbs because of remote working.

The cost of goods isn't going up per se it's that your wages are deflating. It looks exactly the same but one is driven by demand pull and the other is cost push. We are experiencing cost push inflation which is a deflationary mechanism caused by reduction of volume on low margins.

[epic is back]

im holding tight with all assets  until melvin chimes in on how to proceed

[Dokey111]

Bogle died wealthy and loved by family, friends, and hundreds of thousands of grateful and happy investors.   

"Jack did more for American investors as a whole than any individual I’ve known" - Warren Buffet

I worked for him.  He was a good guy.

[Campeon Del Mundo]

Economists claim that we are in a recession, yet the stock market is at a record high, a bunch of companies are trading at record highs and have gone buckwild during this so called recession and the housing market is booming, even higher than during the bank scam from 2005-2008.  How is this all possible?

Can you really have a recession, record unemployment, an economy on the brink of a depression yet have record house prices and record stock market?

Something seriously shady is going on and this whole house of cards is going to tumble soon. Are these economists going to claim they didn't see this coming?

   It's going to be like 2008 but 10 times worse.  It's an economy built on a massive debt bubble.
It will correct to fair value.  Those 600k homes this time next year might be selling for $175k ..

    The stock market and housing markets are all addicted to easy money from the Federal Reserve.  All they are doing is increasing the money supply by printing trillions out of thin air and dumping it in to the financial markets.  That props up the stock market and housing markets.

[TheGrinch]

   It's going to be like 2008 but 10 times worse.  It's an economy built on a massive debt bubble.
It will correct to fair value.  Those 600k homes this time next year might be selling for $175k ..

    The stock market and housing markets are all addicted to easy money from the Federal Reserve.  All they are doing is increasing the money supply by printing trillions out of thin air and dumping it in to the financial markets.  That props up the stock market and housing markets.

who says they will ever stop QE

[mphgrove]

Economists claim that we are in a recession, yet the stock market is at a record high, a bunch of companies are trading at record highs and have gone buckwild during this so called recession and the housing market is booming, even higher than during the bank scam from 2005-2008.  How is this all possible?

Can you really have a recession, record unemployment, an economy on the brink of a depression yet have record house prices and record stock market?

Something seriously shady is going on and this whole house of cards is going to tumble soon. Are these economists going to claim they didn't see this coming?

Do economists truly claim we are in a recession? Unemployment is my own personal measure of recession and it is between 5 and 6 percent (not outstanding, but not bad). Housing and stock market very positive, as stated above. Poverty reduced (temporarily) through all the COVID money. Manufacturing picking up. I may be the only one, but I say we are in a pretty decent economic uptick. But whether it will last is anybody’s guess.