Investing General Discussion

Well apparently the cooks at the Dept of Labor "revised" their CPI data for the last few months. Inflation was higher to push up markets.

Lightning Lord Rule said:

I'm not liking a lot of the news I'm reading lately.

-Inflation for last month got 're-adjusted' up. This will further justify more fed rate raises. Of course actual inflation is still way out of sight of the official #'s whatever they are.
-Employment numbers are shit, but this is raising stock prices. This is still very counterintuitive to me, even though I guess it makes logical sense.
-Just saw a scare story from JP Morgan saying tech stocks have peaked for the year. Though this is likely a counter signal since I'm pretty sure they only put out Opposite News to chum the waters.
-It seems like the last month of rising stocks is based on smoke and mirrors and there's another shoe out there just ITCHING to drop. That's just a feeling on my part though.


I'm getting more and more tempted to put in a stop on most of my index money and buy some SQQQ here soon.

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Looking at each point from my understanding:

1) Powell is basically chasing inflation which won't work. I think of it like gravity and escape velocity. The inflation rate is escaping faster than the gravity rate is pulling it back. Compounding that are tons of factors not limited too : what other countries do, if Europe, Canada, Australia etc raise their rates but the US doesn't raise theirs, there are consequences for that. The market literally doesn't believe Powell will do anything to damage the gravy train because he hasn't so far. The fed is not serious and everybody can see it. Biden admin is doing everything they can to avoid recession (even change the definition) and this soft landing stuff they are doing is a delaying action I fully believe. Don't let it get too bad and keep the market stable for now as best as possible.

2) I think the employment numbers are not only overstated but actually a problem for different reasons. Strong jobs are said to be propping up and strengthening the economy. As an example, a buddy of mine just started doing uber eats. Why? He needed side money because the job he works at isn't paying enough anymore for all his bills. YAY second job helps employment numbers. A lot of these jobs are "temp" or "Gig" jobs that I suspect are filling the gaps and barely helping people get by. Technically a job that looks good on numbers but reality is something else. Layoffs in my experience tend to be a last ditch effort to keep up a stock price. Raise prices or cut labor. There is a ceiling that you can raise prices and there is a floor to cut labor that you aren't functional anymore. Raise prices have been done last year. Now it's cut labor... what is after that? Bankruptcy normally.

3)Was just listening to something that said in the past 40 years that the 3rd year of any President other than Bush has been great for the stock market especially Tech stocks because that's when most legislation gets passed. There is usually a war that needs tech and some kind of shortage or need to put money into the tech sector. Just like the Chips bill that was passed to help tech, need those semiconductors for example. Especially with defense contractors like Boeing or Northrop Grumman and stuff like Starlink from SpaceX since we can't use Russia to launch satellites anymore. Tech may not be growing but will still be here. Heck PLTR just turned a profit for the frist time in ...ever? That's about as tech as you get with their ....what million points of data?

4) I believe you are right. There will be a price to pay for all of this but when is the key and likely nobody knows. Likely it won't be a slow slide but it'll be a ABANDON SHIP type move and it'll be fast. Crashes normally aren't over weeks but hours or days at most. Best you can do financially is try to hedge to the downside if you believe that it may drop. SQQQ is in the 30s right now and I've personally been scooping up some shares here and there for weeks. Never hurts to try and prepare.

Wingz said:

... Likely it won't be a slow slide but it'll be a ABANDON SHIP type move and it'll be fast. Crashes normally aren't over weeks but hours or days at most. ...

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Historical data completely and entirely disagrees with this statement. (2000, 2008, etc.)

The only ones that happen over hours or a day are the weird blips like the flash crash of 2010 (technical issue).

Jysin said:

Historical data completely and entirely disagrees with this statement. (2000, 2008, etc.)

The only ones that happen over hours or a day are the weird blips like the flash crash of 2010 (technical issue).

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Glad someone else said it. Crashes aren't quick.

Got caught holding small bags of AVYA. Here’s to hoping dummies will still buy it when delisted in hopes it’s worth something after ch 11. It’s a small drop compared to what I made, I was just hoping they would pull something off and not ch 11. Would have been moon time. Ended up being a dud lol

I think the perception of a crash being "quick" is that there is usually some major event that sticks in your mind. The 2008 financial crash took a while, but Lehman Brothers was a shock that brought everyone's attention to it.

ECB takes inflation seriously....

SEC (finally) just voted to shorten trade settlements to 1 business day.

A long time coming for that vote.

Rates fucking ripping. That was such a bad CPI print.

Zzen said:

Rates fucking ripping. That was such a bad CPI print.

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So, who is right? Stocks or bonds?

Still bullish on Roku long term.