'Market bulls and bears are having trouble as 'unlimited' Fed support short circuits models' - CNBC

[empedocles]

Lot of 'shaky' things seem to be going on.

[Johnny2X2X]

1. It's bonkers

I had a sandwich with my financial guru friend last week. We often talk finance, the markets, and individual company values. His models are saying the DOW should be at about 16,000. I see the same thing, there's very little value to be found in the equities markets. It's an unprecedented situation, the markets have never been this overvalued in their history. They're being propped up by the Fed, but it's temporary, the crash will be remarkable.

Even some total Con friends I have who are astute financially have told me they are 100% in cash and bond funds.

[empedocles]

2. Big question is how long the 'propping' can last.

Gold and silver have been quite volatile, day to day. Those markets have a lot of varied 'interests'.

Uncertainty abounds

[Johnny2X2X]

3. Nov 4th

This is the most short sighted endeavor our government has ever taken in the markets. It's 100% related to the election. And it's going to hurt in the long run, a lot.

[empedocles]

4. The S&P index at record highs is especially ludicrous and suspicious.

Great majority of the S&P stocks are markedly down. Somehow, the S&P index seems to be bought upwards. Fooling people.

DJIA does seem grossly overvalued also. However, DJIA hasn't confirmed the S&P highs - which is an indicator.

[Question is, I guess, whether the traitortrumpers can fool enough people, for a long enough time . . . ]

[uponit7771]

6. +1, its not doubt a tech bubble that's going to bust on Nov 4th no matter who wins. I'm watching

... for shot position daily.

The feds can't keep buy up corporate bonds and sticking the US tax payer with the bill

[empedocles]

7. Please let us know how the shorts, and the short squeezers, are doing. Thanks.

[SoonerPride]

8. Biden wins, the Fed pulls price supports, market crashes, trump blames Biden's win

This is exactly what will happen.

[PoindexterOglethorpe]

10. I read recently that the market will probably go up

sharply with a Biden win. Don't recall the source, so I can't say how reliable that statement might be.

[a kennedy]

12. That's what the orange blob is saying too........

DAMN, DAMN, DAMN, DAMN, DAMN

[SoonerPride]

13. He's already giving away the game, because he can't stop himself

And when the market crashes he will add that to his reasons he must stay in power on top of "the election was rigged" and a million other excuses.

I fully anticipate this.

[a kennedy]

15. It makes me just sick. There's just been so much damage to EVERYTHING this piece off shit

has touched in these last four years, it’s just going to be a difficult, difficult rebuild. Gawd I just despise him so much.

[uponit7771]

5. THIS !!!! All the market uptick does not explain bond squeezing or retail traders. That doesn't get

... this much uptick in all the indexes like that.

People would quickly sit out in .25% cash gains in bonds or money market accounts vs lose 10% in indexes in days.

Somethings wrong

[PoindexterOglethorpe]

9. Don't confuse the economy with the stock market.

They are two very different things.

Several things to keep in mind:
Over the long run, the market trends upward.
Two out of three years the market is up.
Most gains and losses occur in an extremely narrow time frame, something like five days in a year.

That all means that trying to time the market isn't a very good idea. Your chance of doing it right is minimal. Especially if you sell in a panic because your holdings have gone down. The best advice is to be diversified, rebalance your portfolio a couple of times a year, and don't fret the corrections. Note that the recovery since the sharp drop in March has been almost complete.

I also wonder why a financial manager thinks the market should be at 16,000 right now.

[empedocles]

11. All that may be well enough . . . in normal times. However, it would be

terrible advice in 1929-1930.

In these abnormal times with the obvious looming spector of 'Depression' [unemployment, middle class losses, continuing Covid, ridiculously top heavy 6 stock market], safety, - stock market promoters of the conventional wisdom aside, safety first, may be prudent.

[Wounded Bear]

14. The markets have been feeling very "bubbly" for a while now...

[PoindexterOglethorpe]

16. One huge problem with the Crash in 1929

is that an awful lot of stock had been bought on margin. People put down 10% of the stock price, and financed the other 90%, only the expectation was that the price would go up, they'd sell, and never have to pay off the loan. That isn't happening these days. I believe even those who do buy on margin need to front up 50% of the stock price, so there's not very much margin buying and the exposure to price drops simply isn't that great.

A lot of people were completely wiped out financially by the Crash and the Great Depression.

Also, throughout the '20s there was already essentially a Depression for farmers. They'd overplanted crops because during the Great War they could sell everything at good prices. The war ended, prices dropped, so they planted even more. That's also a huge contribution to the Dust Bowl. By planting even marginal land, by stripping the land of everything, once the rains stopped, it was a big mess.

The causes of the Crash and the Great Depression are many and complicated.

As long as I've been here people like to gleefully predict another Crash. They gloat over the possibility that stocks will completely crater, as if they don't have a 401k themselves. I just don't get it.

[empedocles]

17. You are probably familiar with long term stock market charts. They are full of considerable

waves. There are some big waves, that really wipe out a lot of people. A big one, given the national debt, the problems in the world economy, the longterm Covid impact yet to be discounted, the great damage to many around the world, trump, a long overdue bear market, etc. is long overdue - with business media acknowledging manipulation in the markets. The idea of a permanent plateau of prosperity, or the manipulated appearance of such, to benefit 401k's - 'I just don't get it',

Given all that, and more, my sense is many folk would like to let the bear do its corrective work on trump's watch.

[PoindexterOglethorpe]

19. I am not saying we have permanent prosperity.

Or that markets don't go up and down.

I do take the long view, mainly because I've been investing for nearly 45 years now. I am vastly better off than I used to be, thanks to the long term. I also have an excellent financial advisor who has me in investments that simply don't go down all that much in market downturns. Lucky me.

[roamer65]

18. We aren't shackled by a gold standard like 1929 to 1933.

YoY, M1 money supply is up by about 40 percent. It will probably double somewhere in 2021. Inflation will be a problem in the future. High inflation.

[Awsi Dooger]

20. I am far superior at identifying the bottom than the top

That tendency is clear cut in my investment history so I don't try to fight or deny it. I rarely sell anything even if I feel a downturn is coming. But I do jump in and buy after downward corrections, like late March and early April this year and January a couple of years ago.

When I was primarily a sports bettor I had equal feel for those numbers up or down. It really shocked me in the market when that didn't hold up.

[empedocles]

21. Imagine the shocks, the investment pro's in the OP headline, are having, when their

million-dollar models don't 'hold up'.






[By the way the acronym for buy low, sell high, is - you guessed it blsh]

[Awsi Dooger]

25. I've spent a lot of time looking at those models

Even tinkered with my own homemade attempts on Excel, because it's not all that dissimilar to what I've long done with sports results. There have been several times when the models were correct and I should have reacted, like maybe 5 years ago when I was overweight on biotech stocks and the models said get out but I did not. My XBI stake really plummeted.

But finally I decided to step back and chart things. I kept a file of the models and what they were saying, regarding the stocks I already owned and others I was considering. It was hit and miss all over the place. After 8 months I'd seen enough and quit updating the file. Buy and hold was faring at least as well if not better than reacting to everything.

In sports I know the variables and can adjust the model, if let's say the NFL becomes more pass happy, which occurred following 2004. In business I don't know enough or care enough to understand why some company or some sector deviated from model expectation. And that reality isn't going to change.

I knew enough to buy Apple a long time ago because I trusted Steve Job's brilliance. That's why I've had this avatar since 2003. The rest of this stuff may be a blur but I went 1-0 when it mattered.

[budkin]

23. This whole thing is going to pop like the worst kind of pimple

And it's going to be horrible.

[empedocles]

24. Hope it doesn't 'pop' all at once. [Martial law threats, etc]

Better it ooze more slowly, soon.