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The end of the US stock market is nearing

  • #1,161
  • Edited 11:43am Apr 5, 2020 10:06am | Edited 11:43am
Quoting Edd111111
{quote} Hi Igor, to me it seems that only prolonged pain will force the sale of such holdings either through necessity of individuals or Government policy or to avoid bankruptcy. The drop has been relatively quick and if commerce can continue /resume within a shorter time frame than usual down turns, then "Hope" to get out or better is still available. However if commerce does not return or resume and at a reasonable level within for example 100 days (to long for most business and governments to bankroll without productivity) then forced sales and...

"Hope dies hard"... that's for sure... however, what you have just wrote would have made a perfect sense only under a totally different circumstance... there is one major thing that invalidates any potential for an optimistic scenario at the end of the ongoing turmoil... the virus is only a reason... an excuse for what's going on... the actual cause is something else.. it's the inability of the modern capitalistic consumption based economy model to expand further because there are no more free markets left...the existing consumers are already in debts up to their teeth... perhaps the only solution as to throw the money over populated areas from helicopters, as it was already suggested some time ago... though it's the last possible way that has left in order to boost somehow consumers' demand... apparently it's not gonna work for long either because it will end up with hyperinflation... an inflationary shock, if you wish... people are yet to understand that if no virus it would've been something else... as you can see I posted my forecast way ahead of this epidemic story... the real problem is that under current conditions financial capital cannot be reproduced... there are plenty of money around that however cannot be invested anywhere to generate profits... this will inevitably lead to the major changes in the world economic model... mass bankruptcies are to follow shortly... obviously, the problem is not fixable at this point... there will be no business as usual... never ever... from my perspective it's quite likely that some sort of new "dark ages" are coming because culture and science are to be the very first victims of the main shift in the political, social and economic lives of the world population as people will be struggling even to satisfy their very basic needs such as food and shelter...
  • #1,162
  • Apr 5, 2020 11:51am Apr 5, 2020 11:51am
here is quite an interesting source of info to analyse and to get the idea how the world economy is being turned off... https://www.google.com/covid19/mobility/
  • #1,163
  • Apr 5, 2020 3:16pm Apr 5, 2020 3:16pm
Quoting Igrok
here is quite an interesting source of info to analyse and to get the idea how the world economy is being turned off... https://www.google.com/covid19/mobility/
HI Igor, thanks for the reply, Hyperinflation I agree is a massive issue and with the trillions of dollars already printed in so many countries over the last 12 years, its amazing we haven't see more of it. A coordinated effort amongst global central banks could see Government nationalisation of some debts not necessarily a forgiveness of debts. This scenario will be interesting should negative interest rates be normal. I totally agree the market conditions where more than ripe for a downturn (significant crash), not just with your excellent analysis, also with many others, negative bond yields, repo market pump up etc. As for free markets, they can be created easily enough as all other free markets were. Possible markets include digital currency, virtual real estate, carbon credits (not so free but could start a movement) and anything else, Tulips perhaps ? Your first post on this thread shows a much more gentle decline to that which occurred and a much more palatable decline for all those who were not ready. Could this mean that prices linger around areas for longer, or greater volatility withing a range? While I too think there is further to decline to bring about balance again, I see to many vested interests to permit a return to the Dark Ages type scenario. However I do think War is very likely in all recovery scenarios, most especially for political leaders and captains of industry to maintain power (plenty of history examples). I don't think our perception of the world will ever be the same, their is a chance however that business and Nations working together during the crisis will lay a path for further collaboration. Communism v Capitalism in the 50s and 60s produced some of the highest outputs from labour ever, perhaps we need another great space race to reignite and focus purpose as an initial catalyst to stymie the financial bleeding and avoid depression (in population mood) scenarios.
  • #1,164
  • Edited Apr 6, 2020 8:57am Apr 5, 2020 4:49pm | Edited Apr 6, 2020 8:57am
Quoting Edd111111
{quote} HI Igor, thanks for the reply, Hyperinflation I agree is a massive issue and with the trillions of dollars already printed in so many countries over the last 12 years, its amazing we haven't see more of it. A coordinated effort amongst global central banks could see Government nationalisation of some debts not necessarily a forgiveness of debts. This scenario will be interesting should negative interest rates be normal. I totally agree the market conditions where more than ripe for a downturn (significant crash), not just with your excellent...
back in 1970-th the socialistic economic model (USSR and its satellites) was about to win the competition with the capitalistic one (US and its minions)... introduction of Reaganomics has allowed to turn the table around for the West and to win the Cold War eventually... Reaganomics model has since ran out of steam... no more growth potential within this very model... it's now dying right before our eyes... (there also was a so called "Conversion Theory"... it was first introduced in 1930-th and became popular among some of the economists and philosophers in the 1950-th... the idea was to take the best parts from both social systems and economic models and to create some sort of a synthetic one, which would be free of all the shortcomings of them both... I don't know whether it makes sense or not...)
though for the moment my personal perception of the future might be as the following:
1. the world is likely to split into several economic zones of influence with one common currency each... three military superpowers: US, China and Russia will become the "points of assembly"...
2. Anglo-Saxon part would include US (as a leader) also Canada, GB, Australia and NZ...
3. China will become the leader of the Far East part (both Koreas, Taiwan, Singapore and such)... with the exception of Japan, perhaps...
4. Europe is likely to split apart... some of the countries will become particles of Russian controlled economic zone and the remaining others are likely to group around France...
5. Russian controlled alliance may include former USSR territories, also Germany and Japan... (btw both of them are still under US military occupation that in new world order reality must be considered as a waste of precious resources for US)...
6. the rest of the world countries are likely to become satellites of one or another main economic zone... South America will either create its own zone or will get split politically and economically between the main three...

for it to happen the national oriented forces (powers) must first win its ideological and conceptual war against the liberal idea of Globalization... which looks more than probable now and, given the circumstance, is rather only a matter of time... then there should be something like new Yalta Conference where the leaders of those main parts will agree in regards to how their powers will be split over the world territories... social and economic systems are likely to be similar in all the parts and consisting of two segregated contours of capital circulation... one contour is the infrastructural one under full governmental control and another one is a private, capitalistic like, business with the main goal to satisfy the public's needs in consumer goods and services... there will be two different types of money in circulation in each of this economic contours (nothing new here... used to be in Comecon...) in my opinion that's how it might look like after being built eventually on the ruins of the modern world economy...
  • #1,165
  • Apr 6, 2020 1:40pm Apr 6, 2020 1:40pm
https://youtu.be/giiDPiEioe0
  • #1,166
  • Edited 4:45pm Apr 6, 2020 2:08pm | Edited 4:45pm
Quoting Argo
https://youtu.be/giiDPiEioe0
it all could've been possible on any national level... it's impossible to fake the disaster on such a great international scale as it is today... in regards to political corruption and stuff I totally agree with this guy... it's everywhere... though mostly organized domestically...
  • #1,167
  • Apr 7, 2020 2:37am Apr 7, 2020 2:37am
Quoting Igrok
{quote} nice retracement... might be a good opportunity to bail out of longs... infamous song " the day the NASDAQ died" might soon become popular again...
Hi Igor, it looks like the NASDAQ has hit a good retrace level today, I think the sun might be shining and time for shorts?
  • #1,168
  • Apr 7, 2020 2:38am Apr 7, 2020 2:38am
they are now using death rates as fundamental data, preposterous! the pied piper economists are already out to save the day
  • #1,169
  • Edited 4:08am Apr 7, 2020 3:39am | Edited 4:08am
As long as money is pumped into the system, stocks, as one of the inflation-compensational mechanisms, can only continue to go up.
Return To Disorder
  • #1,170
  • Apr 7, 2020 3:51am Apr 7, 2020 3:51am
Quoting eFFx168
they are now using death rates as fundamental data, preposterous! the pied piper economists are already out to save the day
ridiculous indeed... just yesterday I wrote an article outlining there the very same fact...no market reaction on real economic stuff and a huge response on the shadow of hope for some drop in the death rate...
  • #1,171
  • Apr 7, 2020 4:00am Apr 7, 2020 4:00am
Quoting Edd111111
{quote} Hi Igor, it looks like the NASDAQ has hit a good retrace level today, I think the sun might be shining and time for shorts?
given the circumstance NASDAQ is the only thing that might suffer less than the others... people in the industry can easily work from home... pretty much like us...))) I just wonder when the times will come for Boeing workers to assemble their planes right in their garages...
  • #1,172
  • Apr 7, 2020 4:05am Apr 7, 2020 4:05am
Quoting rockit
As long as money is pumped into the system, stocks, as one of the inflation-compensation mechanisms, can only continue to go up.
Weimarer Republik like inflationary future might be in sight... Remarque's novel "The Black Obelisk" is my favorite one...
  • #1,173
  • Apr 7, 2020 4:10am Apr 7, 2020 4:10am
Quoting Igrok
{quote} Weimarer Republik like inflationary future might be in sight...
Well, yes, (in-)officially we are in hyper-infaltion territory, as inflation is the difference of growth of money ("money supply", m3) and growth of economy (gdp) (and not the lie governments and cbs put forth); money-supply (round the world) just exploded while economies will contract at least 25%...
However, in our times inflation hides in the prices of stocks and alike.
Return To Disorder
  • #1,174
  • Apr 7, 2020 4:33am Apr 7, 2020 4:33am
Quoting rockit
{quote} Well, yes, (in-)officially we are in hyper-infaltion territory, as inflation is the difference of growth of money ("money supply", m3) and growth of economy (gdp) (and not the lie governments and cbs put forth); money-supply (round the world) just exploded while economies will contract at least 25%... However, in our times inflation hides in the prices of stocks and alike.
" The Emperor's New Clothes" will be revealed no matter what... and quite soon I guess as they are about to start trowing money from helicopters... international food market might be the first one to respond... in any case, financial capital is no longer able to reproduce...
  • #1,175
  • Apr 7, 2020 10:42am Apr 7, 2020 10:42am
What's all this optimism about? If you look at the wall street the world looks so rosy. :-)
  • #1,176
  • Apr 7, 2020 12:10pm Apr 7, 2020 12:10pm
Quoting Igrok
{quote} ... in any case, financial capital is no longer able to reproduce...
Luckily mine is...matter of fact, it had been producing quite well since people have been declaring various doomsday scenarios. The way I see it is people ARE optimistic....they see this virus as a relatively short lived thing, and soon spending and buying will get back close to normal (with the ability to get things shipped to your house or just pick them up at the store ready for you, consumer goods haven't dropped as much as would be expected). Will things change once this becomes a cyclic issue? Sure, people will be smarter, in that people will make sure they keep a minimum supply of items at home so as not to get caught off guard again, which in itself helps boost the economy.

Will the DJIA zip up to the high again in a month? Probably not, but looking at the Daily, Weekly and Monthly charts, it was easy to see that it was going up this week with 24000 area being the first target (10EMA on the Weekly). Granted, I look at everything from a short term perspective of a few days to a couple of weeks, but I haven't found any real money trader (no disrespect to anyone, but by that I mean someone who will not hesitate to put $10K on a trade) that believes in the total destruction of the stock market and capitalism and society in general (like is mentioned here and various internet news outlets), and I actively trade and converse with a group of several hundred other stock, index, options and futures traders (to be clear, these are NOT investors).

Does the jobs report mean anything right now? No, because everyone understands why the numbers are going up. It is not an economic wonder or any speculation needed. Everyone knows why. But people are getting a small stimulus check, unemployment money is increasing, EBT money is increasing, and many people laid off are still getting their base pay while at home. So, are things bad? Heck yes!! Does this mean the destruction of the economy? Not even close, because people want to get back to normal, even if it is a "new" normal, and every day we are getting closer and closer. Just watch what the markets do when a vaccine is announced, and then watch earnings for the quarter after....

But, like the song says: "It's the end of the world as we know it, but I feel fine..."
  • #1,177
  • Edited 2:04pm Apr 7, 2020 1:48pm | Edited 2:04pm
Quoting moneymaker2
I haven't found any real money trader (no disrespect to anyone, but by that I mean someone who will not hesitate to put $10K on a trade) that believes in the total destruction of the stock market and capitalism and society in general (like is mentioned here and various internet news outlets), and I actively trade and converse with a group of several hundred other stock, index, options and futures traders (to be clear, these are NOT investors).
that's quite an argument of yours... isn't it the same bunch of morons that had been trying to ridicule me for my market outlook for several months straight before stuffing their tongues up their rear ends and now all of a sudden resurrecting again just because the markets are currently making some technical Fibo related correction?...
  • #1,178
  • Apr 7, 2020 3:14pm Apr 7, 2020 3:14pm
You are true discovery to me and briliant person overall. Thanks for your insights Igor.
  • #1,179
  • Apr 7, 2020 4:05pm Apr 7, 2020 4:05pm
Speaking of fundamentals, I wonder how long larger consumer credit will be viewed as a positive for Markets, I suspect this may become a more important indicator, fundamentally as a gauge on supporting living costs /standards, with greater importance as defaults rise.
  • #1,180
  • Edited 4:52pm Apr 7, 2020 4:38pm | Edited 4:52pm
Quoting Edd111111
Speaking of fundamentals, I wonder how long larger consumer credit will be viewed as a positive for Markets, I suspect this may become a more important indicator, fundamentally as a gauge on supporting living costs /standards, with greater importance as defaults rise.
that's the issue to think about, indeed... the main fundamental problem is that the entire idea of Reaganomics was based on consumer credit expansion... so, by now it has already ran out of gas and there is nowhere to expand to... that took place long time ago, as a matter of fact... apparently the economy has never even recovered from the previous 2008 crisis... take a look at how many Nobel Prizes in the economy have been awarded since then... and none of the winners received it for a work somehow dedicated to that crisis analysis... it's a taboo even to discuss those matters among proponents of the modern model of capitalism and within liberal economic scientific community... a really great problem has never been properly analysed, evaluated and no solution or alternative has been offered so far... the whole issue was just swept under the rug ( like it never happened), cosmetically disguised and forgotten... this virus thing is just a trigger (or perhaps even only an excuse) for the greatest in human history economic downturn... sooner or later the virus related matters will fade away but the main problem is not gonna disappear along with those... therefore the smartest people must start thinking about the future and how it might look like in order to restructure the world economy the right way after its imminent collapse...
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