Blake Hampton

I’m 22 and I currently live in Oklahoma. I’m a part-time federal employee that’s also going to school for a Bachelors in Computer Science. I grew up with my grandparents in a nice middle-class home and neighborhood. I went to a good elementary school, but went to some pretty ghetto middle schools and high schools. Additionally, I’d say that I’ve done pretty well with money so far, but I’ve learned some hard lessons too. I’ve also experienced childhood struggles but I’m sure not as bad as some others. It’s good to see the bad sometimes, it keeps you grounded.

Record high market valuations for basically every single asset class, record fiscal deficits and debt levels, a moron as our president-elect and more waiting in congress, a ton of money in the system from past QE. Just because things are boring now means nothing.

You are extrapolating nominal returns for a situation that we have never before experienced.

Definitely not too preachy. If I didn't have any responses for my comments, I might as well go talk to a wall.

You guys are absolutely right when you say I don’t have a handle on this—it feels impossible to. I’ve spent the last couple of years really digging into this stuff, and every time I think I’ve figured something out, I quickly realize I’m wrong. We don’t know what’s going to happen. That said, I do think it’s possible to understand the different ways it could play out and position yourself for each scenario. The only thing I’m sure of is that none of this is good, and whatever bad comes from it will hurt a lot of people. I don’t plan to be one of them.

I have studied 2009, and the system was broken. It took governments around the world printing tons of money to save the entire banking system. “If we don't do this tomorrow, we won't have an economy on Monday.” - Ben Bernanke, 2008

We live in an economy where personal consumption expenditures represent 68% of our GDP. Ever heard of the wealth effect? What do you think happens when reality kicks in? Do you really think people will feel the same when they witness half of their retirement accounts disappear? What about when the fiscal situation finally shows signs of breaking, and Congress is soon forced to reform entitlement spending?

It took the S&P 500 13 years to fully recover from the Dot-com bubble, even amid the FED lowering rates to 0% and conducting large amounts of QE. I vehemently doubt we will be so lucky in the future.

I don’t blame people for not understanding the situation. This stuff is all a convoluted mess of data, figures, policy, and other esoteric stuff that most people won’t ever understand. And this is precisely what makes it so dangerous. There are so many people now taking on unbelievable amounts of risk, and they don’t even realize it.

Pg. 10, Eye on the Market - JPM @Spooky posted this on the Tidbits thread and It's quite telling. Thanks by the way, it really is an interesting document.

I completely agree. “History Doesn't Repeat Itself, but It Often Rhymes” - Mark Twain

"I have no idea on timing. It’s easier to tell what will happen than when it will happen." - Warren Buffett

I think there are scenarios where some of these "overvalued" equities still perform well. Companies like Apple might seem expensive, but like Buffett has previously said during an annual meeting, if people generally had to choose between their second car and an iPhone, they would pick the iPhone. He's basically telling us that they have unlimited pricing power, maybe the best pricing power of any business outside commodities. I don't see how the market can do well from here.

Quotes "An investment operation is one which, upon thorough analysis, promises safety of principal and a satisfactory return. Operations not meeting these requirements are speculative." - Benjamin Graham, Security Analysis "The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. They know that overstaying the festivities -- that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future -- will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands." - Warren Buffett, 2000 Chairman's Letter "In the first ten years after the war - the decade ending in 1955 - the Dow Jones industrials had an average annual return on year-end equity of 12.8 percent. In the second decade, the figure was 10.1 percent. In the third decade it was 10.9 percent. Data for a larger universe, the FORTUNE 500 (whose history goes back only to the mid-1950's), indicate somewhat similar results: 11.2 percent in the decade ending in 1965, 11.8 percent in the decade through 1975. The figures for a few exceptional years have been substantially higher (the high for the 500 was 14.1 percent in 1974) or lower (9.5 percent in 1958 and 1970), but over the years, and in the aggregate, the return on book value tends to keep coming back to a level around 12 percent. It shows no signs of exceeding that level significantly in inflationary years (or in years of stable prices, for that matter)." - Warren Buffett, How Inflation Swindles the Equity Investor ^ This article still has a ton of applicability today, and it remains one of the best ever written on investment. The Market - TTM S&P 500 ROE: 17.2% - 24-year average S&P 500 ROE: 13.3% - Current S&P 500 P/B: 5.2x - TTM average S&P 500 tax rate: 18.2% - 30-year average S&P 500 tax rate: 30.3% - Increased interest expense as companies refinance debt issued during ZIRP - (ASU) 2016-1 requiring companies to record unrealized capital gains as income If you were to adjust the Shiller P/E using historically average interest and corporate tax expenses, the number would be sitting at an all-time high by a wide margin. We are currently experiencing the most expensive stock market in history, more expensive than at the peak of the tech bubble.

I unfortunately agree but it's not always their fault completely. I'm tutoring one of my relatives in high-school math, and I soon figured out that she doesn't understand simple multiplication tables. She also grew up in foster care and went to bad schools.

It's my mistake by generalizing the poor in saying that they "are dumb," I edited it to say that they can be.

https://www.crfb.org/papers/fiscal-impact-harris-and-trump-campaign-plans

The "poor" vastly outnumber the rich, and they're the ones that keep the system running at-large. You can only neglect them for so long before they reach a breaking point. An example, during the French revolution, the tax burden placed on farmers was so high that they couldn't afford to eat. The well-known saying: "When the people shall have nothing more to eat, they will eat the rich." - Jean-Jacques Rousseau I'd agree that social unrest is one of the few fears of a rich man, it is one of the only times where he truly becomes powerless. It's essentially an arena where that one man is being pitted against an army. So in our country's great wisdom and intellect, having realized that wealth inequality is arguably at it worst level in history, what have we chosen to do in order to fix it? We elected a man promising tariffs and corporate tax cuts. The poor can also be dumb.

I didn't initially like Twitter anyway, but Elon turned the old Twitter into 4Chan the second he fired all of it's moderation team.

First thing I saw when I first opened X last was a video of an Arab man being stoned to death. Didn't look it up, didn't want it, it was just right there waiting for me on my home feed. Safe to say that I deleted my account, and I also think Elon has gone crazy.

I'm extremely grateful I got served a relatively big loss when I first started; it helped me quickly realize what was actually important. I feel sorry for the ones who walk into a casino for the first time and win big.

From one youngin to another, what moat do you see VRRM having? I really like the business and think that the space has great growth potential, but it does seem like something I'd struggle to understand. My biggest concern is what is their protection from future competition?

Small Cap

Exactly what you said. It’s so much easier navigating now, and I don’t have to deal with constantly opening and closing separate pdfs. It’s very nice.

My best idea for 2025 was giving Value Line another shot, their new digital booklets are incredible.