Theory now is - Stock Market will skyrocket further because of the Ukraine-Russia War

[NW-Bound]

I'm much more concerned about an isolated and possibly unhinged Putin raising the nuclear alert status than the stock market at this point.

The despot just did!

 

[yhoomajor]

I think cooler heads need to prevail.

A nuclear war that engulfs the whole world is not worth trying to keep Ukraine in NATO's orbit. Those chest-thumping for war (on either side) need to think that you can not force Russia to change course by sanctioning them (that will only push them more towards China). Eventually we will back Russia into a corner and only stick they will have left is Nukes.

If I were Russia, I would drop the fascination with West. Split Ukraine into two. Ethnic Russian part (eastern Ukraine) and western Ukraine. Western Ukraine wants to join Europe. Let them. You can't force them to like you .

Russia needs to look east. Be wary of China though. China is no one's friend. But Russia may not have any choice left.

I have a fear China may soon start dumping US Treasuries after West seized Russia's foreign reserves. It may turn prices of Chinese goods in US even more expensive.

 

[OldShooter]

... I have a fear China may soon start dumping US Treasuries after West seized Russia's foreign reserves. ...

Complex question but at its base, China does not hold that much of our debt. Less than 4% and equal to a couple of days' trading volume. Their Foreign Direct Investment here is a fraction of this, so no hammer there. To the extent that China does anything that results in a decline of the dollar, they are also devaluating their own dollar-denominated FDI and debt assets and they are hurting their exports by making them more expensive.

... It may turn prices of Chinese goods in US even more expensive.

China is one of a cacophony of countries that hate that the dollar is the international reserve currency. To the extent that community succeeds in knocking the dollar off its pedestal, all imports will become more expensive. (And all international investments held by US investors will become more valuable.)

 

[kgtest]

I'm calling Putin's bluff. He doesn't have the hand he wants people to think he does. If this leads to nuclear war over trying to revert to his cold war ways, he SHOULD be smart enough to know it will not end well for him. As for China, we are understanding what it means to be so reliant on there export. Slow delivery, supply shortage, higher inflation.

The price of a crude barrel is something to watch...but again, economy and market are two different things.

The cash that was pulled from the markets has to go somewhere. It might get pumped back into the economy, which works well for deflation or it might go back into the markets...or it might just stay as cash. I don't know if there is a third option really. I am no economist but I doubt people switch to real estate, or commodities or something else. This is all a simple supply and demand equation. Where is the supply, and where is the demand?

I follow Peter Santenello, a YouTuber who spent 4 years in Ukraine, and just married a Ukranian bride, has in-laws in Ukraine and friends there. He speaks of the will of the Ukrainian people, and a bit of history about how demoralization eventually sends home the invaders...Iraq, Afghanistan, The American Revolution.

https://youtu.be/ARXdHB4ZprM

I agree that Putin didn't play his cards right. If anything he created some fear, but that doesn't lead to Victory.

With this being said, there is a 3mile long convoy of Russian resupply on its way to the city of Kiev, and the city is essentially surrounded.

 

[aja8888]

The cash that was pulled from the markets has to go somewhere. It might get pumped back into the economy, which works well for deflation or it might go back into the markets...or it might just stay as cash. I don't know if there is a third option really. I am no economist but I doubt people switch to real estate, or commodities or something else. This is all a simple supply and demand equation. Where is the supply, and where is the demand?

That cash is in the possession of the top 0.01% in this country. It's called the "wealth effect" and they are not sharing.

 

[Stormy Kromer]

I'm much more concerned about an isolated and possibly unhinged Putin raising the nuclear alert status than the stock market at this point.

I couldn't have said it better. Thank you.

 

[kgtest]

That cash is in the possession of the top 0.01% in this country. It's called the "wealth effect" and they are not sharing.

Lol true, but their grand kids might share some, at some point down the road. Just cuz grandpappy did it right, doesn't mean Jr will. SO many times the first generation stacks it, and by the third generation, poof...it's gone.

 

[Ninepoint5]

i couldn't have said it better. Thank you.

agreed!

 

[FIREarly]

Interesting, have you tried DCA?

 

[Perryinva]

Still think the market is going to skyrocket?

 

[NW-Bound]

Still think the market is going to skyrocket?

Missiles have several failure modes.

Here's one where the motor fails to ignite.

 

[kingkarmann]

I live just down the street from a food bank.
The cars in those lines just keep getting nicer & nicer......

 

[Magus]

Not trying to be snarky, but that's not what that means.

Interesting fact on the 90% of equities owned by 10% of population stat....the still means the other 90% of folks own 10%, which is $5T, which is exactly half of the total pie of the *ENTIRE* stock market value in mid 2009. All boats rising I suppose...but yeah $5T is still a lot of dough so I while I'm sure there probably 50% of the population that doesn't care about the stock market, its safe to say more than 10% do.

As to the topic of the initial post - I think the gas price increases are going to likely cause a recession here and be bad for stocks as oil's cost represents a massive amount of input costs for tons of other things. Probably will help with the FFR though.