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Dow 15,000 anyone?
Old 04-21-2020, 09:33 AM   #341
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Dow 15,000 anyone?

So what happens if stock analysts are reluctant to mark down earnings when major companies pull their yearly projections? (Apparently many analysts let their numbers ride until next earnings cycle reports are issued.)

Answer - irrational exuberance and whispering about the mystical V shaped recovery. Meanwhile, the monkeys in suits throwing darts have interest to keep the party going until the PE numbers start to look unsustainable.

Hold on to your wallets - the downdraft has started again. And this is just the first trickle of bad earnings reports. On the first quarter, of which only a portion was impacted by the WuFlu. Just wait until more bankruptcies are announced. And second quarter earnings are announced. And second wave of infections hit.

Dearly hope to be wrong on this prediction.
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Old 04-21-2020, 09:33 AM   #342
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I am guessing of course, but it seems to me a retest of the lows are underway. I have been waiting for it as it always seems to happen in most bear markets and we haven't had a retest yet.

If we do go lower, and no I am not cheering for it, but if we do go lower it will give those who have been sitting on the sidelines a chance to buy. They say bear markets usually end in despair with investors giving up in defeat and we have not seen that yet. There are some on other websites that are in denial that this is even a bear market. In my book it most certainly is a bear market, I just hope it doesn't get really nasty, but it might.

It's important to understand how the process works and for those who want to buy equities if given the opportunity to buy at lower prices.
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Old 04-21-2020, 12:15 PM   #343
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I was a very bad senior citizen and spent some of my 'fun' money when the Dow dropped below 19000- (Amazon, Microsoft, Walmart &Tesla.). Time will tell but at my age life is too short not to have some fun, especially given all the money I'm saving while under-house-arrest for Covid 19
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Old 04-21-2020, 03:36 PM   #344
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The Director of the CDC did an interview with the Washington Post today and said that the second round of COVID-19 in the fall/winter could be "far more dire" than round one, as it will coincide with Flu season. The market needs to look a lot further ahead. We got out at a little over 27,000 in the Dow and moved into a treasury fund. We expect we'll be keeping our powder dry for quite awhile. This recent bounce from the bottom always seemed too optimistic to us.
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Old 04-21-2020, 05:04 PM   #345
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The Director of the CDC did an interview with the Washington Post today and said that the second round of COVID-19 in the fall/winter could be "far more dire" than round one, as it will coincide with Flu season. The market needs to look a lot further ahead. We got out at a little over 27,000 in the Dow and moved into a treasury fund. We expect we'll be keeping our powder dry for quite awhile. This recent bounce from the bottom always seemed too optimistic to us.

I also reallocated from 60/40 to 100% treasuries in 2019 after the yield curve inverted. The Spanish Flu had three waves of infections with the second wave was the most severe. I also agree that the recent bounce is too optimistic given the number of layoffs and the impact on the global economy.Very unlikely a V-shape recovery will occur in the USA based on what is happening in China. CCP have lifted the "shelter-in-place" but the Chinese consumers are still fearful.
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Old 04-21-2020, 05:17 PM   #346
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I also reallocated from 60/40 to 100% treasuries in 2019 after the yield curve inverted. The Spanish Flu had three waves of infections with the second wave was the most severe. I also agree that the recent bounce is too optimistic given the number of layoffs and the impact on the global economy.Very unlikely a V-shape recovery will occur in the USA based on what is happening in China. CCP have lifted the "shelter-in-place" but the Chinese consumers are still fearful.
Yup, and Foxconn in China is not just cutting back on overtime for workers, but also cutting hours and workers altogether due to big dip in demand for iPhones. They brought all of the workers back to catch up with their supply, but now they've caught up, and demand is way down. It's going to take awhile for us to come out of this.
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Old 04-21-2020, 05:58 PM   #347
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I'm with you, although I scraped 2019 gains in Jan and 3rd week of Feb, then bought back to raise stock allocation about 4% 3 weeks ago when I hit 40% stocks, then sold the rebuy last Friday.

At least it's amusing. I've never sat on 30% cash before, but If we get near 18000, I'm going back in to raise the stock allocation above the 40% floor, again. If it breaks 18,000, I'll buy at 5% intervals down until I'm down to 2 years cash.

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Originally Posted by UnrealizedPotential View Post
I am guessing of course, but it seems to me a retest of the lows are underway. I have been waiting for it as it always seems to happen in most bear markets and we haven't had a retest yet.
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Old 04-21-2020, 06:26 PM   #348
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Originally Posted by btdt22 View Post
I was a very bad senior citizen and spent some of my 'fun' money when the Dow dropped below 19000- (Amazon, Microsoft, Walmart &Tesla.). Time will tell but at my age life is too short not to have some fun, especially given all the money I'm saving while under-house-arrest for Covid 19
Why do you say that? If you have the funds available, especially annual spending money already, the DOW level on any given day shouldn’t keep you from spending.
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Old 04-21-2020, 06:27 PM   #349
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Originally Posted by k-man View Post
The Director of the CDC did an interview with the Washington Post today and said that the second round of COVID-19 in the fall/winter could be "far more dire" than round one, as it will coincide with Flu season. The market needs to look a lot further ahead. We got out at a little over 27,000 in the Dow and moved into a treasury fund. We expect we'll be keeping our powder dry for quite awhile. This recent bounce from the bottom always seemed too optimistic to us.
Well, I think the second round of COVID-19 is going to occur this summer.
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Old 04-21-2020, 07:34 PM   #350
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Is it too much to ask of you to dial it down a bit?
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Old 04-23-2020, 11:06 AM   #351
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A new take on Remdesivir from STAT.

https://www.statnews.com/2020/04/23/...irus-patients/


If the SEC was a real enforcement authority, they should look at who was buying and selling before these news releases. Redesivir was a failed Ebola drug being promoted as a COVID-19 treatment.
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Old 04-23-2020, 11:12 AM   #352
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A new take on Remdesivir from STAT.

https://www.statnews.com/2020/04/23/...irus-patients/


If the SEC was a real enforcement authority, they should look at who was buying and selling before these news releases. Redesivir was a failed Ebola drug being promoted as a COVID-19 treatment.
True there - "released by accident".
Still the market goes up on this rumor, but not down if/when it is refuted.
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Old 04-23-2020, 11:35 AM   #353
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Interesting tidbit caught my ear while eating lunch and watching the Halftime Report on CNBC today when Josh Brown was asked about the apparent disconnect between the stock market which is allegedly forward looking and what is going on economically, the high level of unemployment, a potential second wave of COVID and the 2020 election.... Josh responded that a lot of what we see in daily trading activity is just "software programs trading with other software programs".
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Old 04-23-2020, 11:51 AM   #354
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Interesting tidbit caught my eat while eating lunch and watching the Halftime Report on CNBC today when Josh Brown was asked about the apparent disconnect between the stock market which is allegedly forward looking and what is going on economically, the high level of unemployment, a potential second wave of COVID and the 2020 election.... Josh responded that a lot of what we see in daily trading activity is just "software programs trading with other software programs".
And just wait until quantum computers get in the game.

Coming technological advancements in AI, quantum computing and the like are one of several reasons why I'm so bullish. Those advancements may portend societal disruptions related to jobs and such, with uncertain outcomes. But as a matter of sheer technological innovation and improvements, I suspect that if we could teleport ahead only a decade -- to 2030 -- we'd be astonished at the then state of computing and penetration of machine learning in vast stretches of society, and well beyond our wildest imaginations today.
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Old 04-23-2020, 12:37 PM   #355
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Originally Posted by pb4uski View Post
Interesting tidbit caught my eat while eating lunch and watching the Halftime Report on CNBC today when Josh Brown was asked about the apparent disconnect between the stock market which is allegedly forward looking and what is going on economically, the high level of unemployment, a potential second wave of COVID and the 2020 election.... Josh responded that a lot of what we see in daily trading activity is just "software programs trading with other software programs".
I've been wanting to ask you your thesis/theory for this disconnect. Josh Brown gave his thesis/theory as program trading. Do you think he's essentially right, or are there other things that you think are going on? Do you think it's the Fed and FedGovt put? The masses exhibiting irrational exuberance? I'm throwing out examples of the kind of answer I'm looking for in order to be clear about what I'm interested in - I'm not trying to put words in anyone's mouth (including yours) or take any disparaging view of anyone's opinion or theory.

It seems I am in the minority who thinks that the market has things approximately right currently, and I'd like to understand from someone I respect and someone who is of a different opinion (I think that's safe to say) so I can learn.

I'm not asking why anyone thinks the market will go down - there are plenty of reasons to think it might. I'm also not asking why anyone thinks the market will go up - there are reasons for that as well. What I'm wondering about is why people here - several on this thread I think - think the market currently has it wrong. One can sort of generically say, "Well, the market isn't accounting for awful fact X" - OK, but why hasn't the market accounted for awful fact X? Is the market or its participants not smart or not well informed or being manipulated or ...?

I'm genuinely interested in everyone's opinion on this question.

Please and thank you.
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Old 04-23-2020, 01:50 PM   #356
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It seems I am in the minority who thinks that the market has things approximately right currently, and I'd like to understand from someone I respect and someone who is of a different opinion (I think that's safe to say) so I can learn.

I'm genuinely interested in everyone's opinion on this question.

Please and thank you.
I’m in. And happy to join you in believing the markets have it right. Am I right? Who knows. This is my argument, however:

1. A largely free market, even if wrong, is the best we have.

2. Even if the U.S. stock market isn’t “largely free,” it is what we have and I will happily support it. How many millionaires and billionaires has it created? And in saying that, I don’t believe wealth is a measure of fulfillment or success. As I age, I have come to question the pursuit of wealth beyond that which is necessary to live. I know a lot of miserable wealthy people. I know a lot of carpenters that I admire.

3. I have no problem with machines trading with machines. My iPhone is smarter than I am. The line between Homo sapiens and machines is blurring daily, and has been for decades (see, e.g., biomedical engineering).

4. At the end of the day, this is a statistical issue. The market is a convoluted mess of countless individuals and machines taking a view of the future. The market is a statistically valid sample under all scenarios of which I am aware. Those arguing that the market is missing something have an uphill climb arguing the contrary.

5: It is hard for me to imagine a future that is bleak. I hope I am alive in 2050. Folks alive then will be better off than us, same as we are better off than those alive half a century ago.

Having said all of the above, I am likely wrong.
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Old 04-23-2020, 02:11 PM   #357
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Old 04-23-2020, 02:37 PM   #358
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You are certainly right. Or not. I am comfortable in my uncertainty.

In the meantime people like me are buying as people like you sell.

Please continue.
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Old 04-23-2020, 02:40 PM   #359
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You are certainly right. Or not. I am comfortable in my uncertainty.

In the meantime people like me are buying as people like you sell.

Please continue.
Because uncertainty is such a great buying signal. Interesting.
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Old 04-23-2020, 02:44 PM   #360
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A massive bubble has formed in the market among the top weighted stocks of the S&P 500 Microsoft, Apple, Amazon, Google, Facebook. The weighting of those stocks combined is higher than the combined weighting of the bottom 350 stocks in the S&P 500. This is why it appears that the equity markets are disconnected from reality. Funds, which number more than stocks, are crowding into a small group of stocks to drive up the markets. Like all bubbles, this one will pop. It's just a matter of time.
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