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The Swamp

  • #68,401
  • Jun 17, 2020 12:31pm Jun 17, 2020 12:31pm
Quoting Blackopal
{quote} There are some similar support arrangements here in Australia also. Unemployed have an extra $250 P/Wk from Government. They buy more beer, smoke more pot, and go golfing every day. Life's great for them. But somebody has to pay for it. It is unsustainable. A country has to produce to maintain a healthy economy. If every country in the world adopts similar measures, where will the money come from to pay the bills? Deficits, higher taxes on the smaller percentage of the population who are still employed on lower wages.
we are doing this since 1980 and more since 90 amd 2000. so what will stop this instant greedy society ? healty habita ? deficits ? nothing
Rule No.1: Never lose money. Rule No.2: Market is always right !
S&P 500 WTI/USD
  • #68,402
  • Jun 17, 2020 1:03pm Jun 17, 2020 1:03pm
Quoting DMA Trader
{quote} we are doing this since 1980 and more since 90 amd 2000. so what will stop this instant greedy society ? healty habita ? deficits ? nothing
Japan economy?
those who can, do. those who cant, talk about those who can
  • #68,403
  • Jun 17, 2020 1:04pm Jun 17, 2020 1:04pm
Quoting DMA Trader
short 1.1238
.I added a few here from 1230 to 1234
  • #68,404
  • Jun 17, 2020 1:09pm Jun 17, 2020 1:09pm
EuroZone will start to feel the pain soon.... Finland spoke up.... Wait for Gemany to leave the Euro then its game over - parity for EURUSD

Inserted Video
  • #68,405
  • Jun 17, 2020 1:15pm Jun 17, 2020 1:15pm
Quoting jaylovin
EuroZone will start to feel the pain soon.... Finland spoke up.... Wait for Gemany to leave the Euro then its game over - parity for EURUSD https://www.youtube.com/watch?v=STr3entUFnw
is Finland one of four frugal ones? hope they all speak up..
  • #68,406
  • Jun 17, 2020 1:25pm Jun 17, 2020 1:25pm
Quoting Boulder
{quote} is Finland one of four frugal ones? hope they all speak up..
in comparison yes... Finland's exports in 2017 was around $67 Billion

Germany on the other hand had a $1.4 trillion in the export sector

Even if the smaller countries start to chip away, the bigger players in the export market like Germany and France will feel more strain eventually being forced to react.
  • #68,407
  • Jun 17, 2020 1:53pm Jun 17, 2020 1:53pm
Quoting jaylovin
EuroZone will start to feel the pain soon.... Finland spoke up.... Wait for Gemany to leave the Euro then its game over - parity for EURUSD https://www.youtube.com/watch?v=STr3entUFnw
A Finn here. This extreme right MEP (Laura Huhtasaari) doesnt really reflect Finlands consensus.. Officially we do support the stimulus plan, and large majority of Finns are happy with the Euro.
Pension fund Return This Month: 2.2%
  • #68,408
  • Jun 17, 2020 2:09pm Jun 17, 2020 2:09pm
Quoting 5astelija
{quote} A Finn here. This extreme right MEP (Laura Huhtasaari) doesnt really reflect Finlands consensus.. Officially we do support the stimulus plan, and large majority of Finns are happy with the Euro.
good to get a local view,
those who can, do. those who cant, talk about those who can
  • #68,409
  • Jun 17, 2020 2:16pm Jun 17, 2020 2:16pm
Quoting 5astelija
{quote} A Finn here. This extreme right MEP (Laura Huhtasaari) doesnt really reflect Finlands consensus.. Officially we do support the stimulus plan, and large majority of Finns are happy with the Euro.

Sure I respect that... We were officially happy with our stimulus plan too and look what happened - with the influx of refugees flooding through europe during election, the stupid Brits hit the panic button and voted us out
  • #68,410
  • Edited 2:39pm Jun 17, 2020 2:24pm | Edited 2:39pm
In late 1929, the bubble popped and stock prices fell as market participants realized that corporate earnings would fall and that stocks were overvalued. The PE ratio fell quickly from about 20 in 1929 to about 13 by the beginning of 1930. People naturally expected a quick economic recovery and decided that stocks were cheap. After-all, a PE of 13 (just like today) is pretty enticing. So began the rally of 1930. The PE ratio jumped up to about 18 before the rally fell apart. The market then fell steadily with occasional rallies until the bottom in late 1932. The amazing thing is that the PE ratios never strayed far from 17 during the rest of the bear market except for right at the end when it fell quickly to bottom at 10. The blue line is price over 17 so the fact that the blue line traces the black line demonstrates this. It is just that earnings fell steadily until they fell to about 7 from the peak at 26, a 73% decline. The story of the great bear market was really one of corporate earnings not valuation.

The moral of the story of course is that a PE ratio is pretty meaningless by itself. What matters is where earnings will be in the future. The best guide to that is simply mean reversion. Corporate profits tend to revert to about 6% of GDP. They recently peaked at almost twice that. If they bottom at half this average that would be a 75% fall just like in the Depression. If that happens we might expect the S&P to fall to at least a PE of 15. The S&P 500 earnings peaked about about 85 so a 75% decline would be 21 and a 15 PE would bring the index to a horrifying 315 a 65% decline from here.

Of course this might be overly pessimistic or it might not. But the point is that stocks will follow future earnings and that those will likely go down from here. Stocks are not nearly as cheap as they look.


http://certainruin.blogspot.com/2009...-in-great.html
Written July 6 2009. He was wrong. But he wasn't dealing with corona then. I tend to agree about earnings. The buying crap w/o a job. Leads me to be anti Pollyanna about equities. Not all, just the ones that rise with the tide for no reason. The ones w/o earnings to back it up.
those who can, do. those who cant, talk about those who can
  • #68,411
  • Jun 17, 2020 2:55pm Jun 17, 2020 2:55pm
Quoting gatorinla
{quote} Japan economy?
probably - who knows.
Rule No.1: Never lose money. Rule No.2: Market is always right !
S&P 500 WTI/USD
  • #68,412
  • Jun 17, 2020 3:07pm Jun 17, 2020 3:07pm
Quoting DMA Trader
{quote} probably - who knows.
japan 3 lost decades..Now they lost the Olympics
those who can, do. those who cant, talk about those who can
  • #68,413
  • Jun 17, 2020 3:35pm Jun 17, 2020 3:35pm
While we wait and read part of a Nice Historical review,


Euro is finally stopped drifting up I guess
FX is a Bitc*h!, No one keeps me wake all night but FX does!!
  • #68,414
  • Jun 17, 2020 4:02pm Jun 17, 2020 4:02pm
Quoting gatorinla
{quote} japan 3 lost decades..Now they lost the Olympics

why do we even use that term because we didn't get a new high in the stock matket ?

did gdp went down 30 years ?
Rule No.1: Never lose money. Rule No.2: Market is always right !
S&P 500 WTI/USD
  • #68,415
  • Jun 17, 2020 4:08pm Jun 17, 2020 4:08pm
Quoting Avir
While we wait and read part of a Nice Historical review, Euro is finally stopped drifting up I guess
1.124 very important as a R
Rule No.1: Never lose money. Rule No.2: Market is always right !
S&P 500 WTI/USD
  • #68,416
  • Jun 17, 2020 4:27pm Jun 17, 2020 4:27pm
Liquidity trap: when rates are low enough, consumers rather hold cash than invest into bonds, because their bond portfolio would take a hit when the rates are finally hiked -> monetary policy stops working
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Pension fund Return This Month: 2.2%
  • #68,417
  • Edited 5:28pm Jun 17, 2020 5:11pm | Edited 5:28pm
Quoting DMA Trader
{quote} why do we even use that term because we didn't get a new high in the stock matket ? did gdp went down 30 years ?
Why yes, it has dropped 30 years.. While debt has grown to 240% of gdp. They are a nation of personal savors. The GDP dont cover the debt. It just gets worse as the debt grows. Its hard to build roads, social cost, etc and stay modern as the debt grows. They are spending money they dont have into infinity. An aging population on a volcano. We dont even know the corona affect yet. In the West we dont have the luxury of savors funding the government. https://www.macrotrends.net/countrie...dp-growth-rate
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those who can, do. those who cant, talk about those who can
  • #68,418
  • Jun 17, 2020 5:23pm Jun 17, 2020 5:23pm
Quoting gatorinla
{quote} Why yes, it has dropped 30 years.. While debt has grown to 240% of gdp. They are a nation of personal savors. The GDP dont cover the debt. It just gets worse as the dept grows. Its hard to build roads, social cost, etc and stay modern as the debt grows. They are spending money they dont have into infinity. An aging population on a volcano. We dont even know the corona affect yet. In the West we dont have the luxury of savors funding the government. https://www.macrotrends.net/countrie...dp-growth-rate {image}
https://en.wikipedia.org/wiki/National_debt_of_Japan
those who can, do. those who cant, talk about those who can
  • #68,419
  • Jun 17, 2020 5:51pm Jun 17, 2020 5:51pm
Quoting DMA Trader
{quote} 1.124 very important as a R
If you have cash or any money in the bank. When the Fed or a central bank lowers rates. Its a way to rob you w/o a gun. You might even smile and want it. Its a way a government can screw a saver. By making your money devalue. Forcing some to seek equities or other risky assets. A way a government can force a population to spend. It works great for a while. Eventually the road ends, when they cant cut anymore. Next financial crises. Hat in hand asking for the middle class, for a bailout. They will promise the middle class some shiny beads Or world will end w/o help. The middle class will bend over. Wash rinse repeat.
those who can, do. those who cant, talk about those who can
  • #68,420
  • Edited 7:40pm Jun 17, 2020 7:05pm | Edited 7:40pm
Short 1.1243, 1.1246,49 and 50 pending

In short now 46 and 49
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