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Does Phase 1 trade deal tempt you more into stocks?
Old 10-13-2019, 07:56 AM   #1
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Does Phase 1 trade deal tempt you more into stocks?

On Friday the big news was an apparent agreement on a US/China phase 1 trade deal. I think there is more to go for the SP500 as the past trade and political news has scared a lot of money into money markets and negativity. However, the one year SP500 gain stands now at 11.1% (as of Oct 11) which is about historically normal and indicates a neutral condition.

My cash is at an all time high due to a one time, not to be repeated, inheritance.

Anybody else feel that at least on a short term basis, maybe a few months, the market is headed higher? And yes, I know this is rank speculation on my part.
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Old 10-13-2019, 08:13 AM   #2
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Almost the only thing which has pushed markets higher (and keep it from falling) much of the year is the promise of a China deal. Every other week or so some news item is posted about progress with the trade deal and the markets would power higher. Later, as nothing comes of it, the froth wears off and markets sink. It's getting old already. This "Phase One" deal is little more than lip service trying to claim some small victory. If anything, the market had been pricing in something more. The biggest issues/promises are still outstanding. I say markets trend lower in to year end. The talking heads will cling to their last hope to put a happy face on things with the "Bad news is good news" logic in that as a result, we have another interest rate cut to look forward to this year.

It's a sad state of affairs when your optimism hinges on the Fed coming to the rescue of a weak/uncertain outlook.

Too much focus is being placed on the stock market. All the artificial support and manipulation in the world is not going to keep it continually moving higher. It's going to fall at some point, so just let it happen and work itself out.

Our government claims China manipulates its currency. At the end of the day, it's little different than manipulating your interest rate. Hypocrisy on display.
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Old 10-13-2019, 09:15 AM   #3
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No.

Quote:
Originally Posted by Lsbcal View Post
... I know this is rank speculation on my part.
So then why are you engaging in it? It's fun, I guess, but IMO it is not a game to be played with serious money.
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Old 10-13-2019, 09:21 AM   #4
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Not into market timing here - just quarterly rebalancing (if needed). Was very close to exchanging a few % of stock for bonds at the market high, but never hit my set point.
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Old 10-13-2019, 09:49 AM   #5
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No.

So then why are you engaging in it? It's fun, I guess, but IMO it is not a game to be played with serious money.
See red above.
... but only when I win.
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Old 10-13-2019, 09:59 AM   #6
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On Friday the big news was an apparent agreement on a US/China phase 1 trade deal.
LOL! We've had apparent agreements before...

Quote:
Anybody else feel that at least on a short term basis, maybe a few months, the market is headed higher? And yes, I know this is rank speculation on my part.
Rank speculation can be fun.

But I wouldn't bet on it.
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Old 10-13-2019, 10:06 AM   #7
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... but only when I win.
Yes. We all love that dopamine shot: see "Your Money and Your Brain" by Jason Zweig
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Old 10-13-2019, 10:08 AM   #8
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LOL! We've had apparent agreements before...


Rank speculation can be fun.

But I wouldn't bet on it.
But in this case the vice premier of China met with Trump publicly (pictures taken). I think this is a done deal as both parities need it, probably Trump needs it more.

Quote:
“Phase two will start almost immediately” after the first phase is signed, Trump says in the Oval Office alongside Chinese Vice Premier Liu He.
See: https://www.cnbc.com/2019/10/11/trum...ith-china.html
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Old 10-13-2019, 10:21 AM   #9
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But in this case the vice premier of China met with Trump publicly (pictures taken).
Seems to me we've seen this sort of "breakthrough" (along with beautiful letters, back and forth praise, warm feelings, pictures, etc.) reached before, only for minds to be changed at the last minute (sometimes in response to a television show or two).

You can go ahead and make a bet if you like. But I wouldn't.
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Old 10-13-2019, 10:24 AM   #10
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If you are into market timing and stuff, the adage “buy on the rumor and sell on the news” comes to mind.
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Old 10-13-2019, 10:28 AM   #11
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Seems to me we've seen this sort of "breakthrough" (along with beautiful letters, back and forth praise, warm feelings, pictures, etc.) reached before, only for minds to be changed at the last minute (sometimes in response to a television show or two).

You can go ahead and make a bet if you like. But I wouldn't.
Well you do have a point. I could get political here but will refrain from saying bad things about the top guy.
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Old 10-13-2019, 10:40 AM   #12
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Well you do have a point. I could get political here but will refrain from saying bad things about the top guy.
You mean Chairman Xi?
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Old 10-13-2019, 10:47 AM   #13
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You mean Chairman Xi?
I will leave this ambiguous
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Old 10-13-2019, 11:17 AM   #14
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Seems to me we've seen this sort of "breakthrough" (along with beautiful letters, back and forth praise, warm feelings, pictures, etc.) reached before, only for minds to be changed at the last minute (sometimes in response to a television show or two).

You can go ahead and make a bet if you like. But I wouldn't.
Presidential libraries are full of these agreements, honorary ink pens, photos of them shaking hands and hugging....and most of those old agreements fell apart over time.
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Old 10-13-2019, 11:44 AM   #15
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If my portfolio goes up about 2% from here I'll sell enough for next year's expenses. It's been within a fraction of a percent of that trigger once or twice earlier this year. If not, I guess I'll be month to month sales during next year.
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Old 10-13-2019, 03:19 PM   #16
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Presidential libraries are full of these agreements, honorary ink pens, photos of them shaking hands and hugging....and most of those old agreements fell apart over time.
In the past they may have fallen apart when administrations changed. Now they often don't last the week.
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Old 10-13-2019, 03:47 PM   #17
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Yeah, Phase I.

I want to know about Phases II - IV before placing short term wager.
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Old 10-13-2019, 04:03 PM   #18
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Phase 1 is historic in that it is the first time a trade deal with China has been focused on them buying more from us (for a change).

Not into market speculation and not into buying from headlines so staying out.

But, finally, there is a Chinese trade deal that actually benefits the USA economy. Historic. Bring on Phase 2. This type of trade deal can only help the USA and I'm for that.
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Old 10-13-2019, 04:31 PM   #19
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Better trade sounds good, the devil being in the details. I'm waiting to see if particularly bad trade news comes during December. That will artificially create room for stock prices to rise during 2020.
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Old 10-13-2019, 04:35 PM   #20
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