Sweet

Watched these years ago when I was a 20 something. Friedman tackled a range of beliefs I had at the time and just undressed and exposed how silly some of them were. I think what u learned most is that there are a whole load of secondary consequences that Friedman could see and understood that I didn’t. Clever guy.

Read as much as I could from his Twitter post. He’s right about the media unfortunately.

Thanks for the explanation

Can we really call this an approach when it’s pretty much what everyone is doing? Approach is just as much the how than the what.

What do you mean by this mattee? I think it is possible we have a decade of sideways movement which is fine so long as you can pick your spots. I do think we aren't going to get the 7-8% return buying at this level unless the economy kills it.

I haven’t crunched the numbers in this so it might be worth digging a little deeper for yourself: ”The S&P 500 has a forward price-to-earnings (P/E) ratio of about 15.5x excluding the Magnificent Seven, while the Magnificent Seven has a P/E of about 35x, according to data compiled by FactSet as of January 2, 2024.” https://www.capitalgroup.com/institutional/insights/articles/magnificent-seven-chart-diversify.html#:~:text=The S%26P 500 has a,as of January 2%2C 2024. It’s not hard to find sectors at single digit or low double digit PE’s if you go looking. AI type stocks are a bit speculative however I’m not see a broad market bubble.

Deficit spending probably can’t continue if rates remains high either, new debt will be a much more expensive. They need to get it below GDP growth and keep it there for a while.

Immigration to the US was a lot more restrictive than you seem to realise. Originally nearly all migrants came from the British isles. Then it was ‘white person’ for a time. There were at times quotas, such as those placed on Germans. And even outright bans of certain ethnic groups - Asians were prohibited.

Should we just let anyone in? I doubt the board would say yes. So there should be rules and a process to migration - so figure out what a large majority agree on and work from there. What is certainly not ok is to just allow millions of people to ignore all those rules, break the law by entering illegally, and skip in front of those who have the decency to go down the proper legal avenues. What’s this got to do with the top though? Unless some are predicting the end of America?

I’ve thought about just putting a chunk of money into Pershing and Ackman. He has at times lost his shirt which makes me pause but he has stopped shorting and he has good ideas.

So you aren’t a John Maudlin subscriber then?

I said "it isn’t tethered to the US economy like it once was" and that "largest US companies are now truly global". I'm really trying to say that the so called Buffett rule, which Buffet used as a crude estimate of where valuations of US stocks lay, is probably less relevant now than when he first uttered it. Maybe, I'm really not sure. It all depends on future growth of the companies, interest rates etc.

What has the stock market valuations in those countries got to do with US companies? Global GDP is growing despite the problems in Europe and China. My only point is that yes the US economy is still the most important but the biggest companies are global in their footprint and that matters. Name another country with the equivalent to the so called Mag7.

There is something else too. In years gone by the US stock market was closely aligned to the US economy. The largest US companies are now truly global and it isn’t tethered to the US economy like it once was.

Don't know anything about the guys work, but the meme is funny. Wouldn't surprise me at all. These same guys who warn people off the market seem very happy every time it goes down.

Didn’t see that news.

Regionals got slammed across the board today. Not liking what Powell had to say.

I consider it fraud yes, because he deliberately deceived clients and moved it into a hedge fund which he wasn’t authorised to do. He was supposed to be a custodian of deposits but he was fiddling the books to fund his hedge fund.

FTX funds were siphoned into the hedge fund without the knowledge of the clients. No way that’s legal.

Regarding not telling others what stocks I own. That might seem like a strange approach on an investing board, even selfish, so let me clarify. It’s not that I won’t share an analysis, my views or an idea on a stocks. It’s just I won’t actively broadcast that I own a specific company because I don’t want to defend it. If someone asks me directly what I own I will of course tell them probably via PM. I’ve a lot of respect for the many great posters here who can tell others their exact stock positions, their respective weightings, and still have a clear frame of mind when looking at the stock. I’m afraid I’ve found out that I’m just not good at that yet. PS - I once told my in-laws what I owned and they were checking the my stock price every day and sending me articles. They used to tell my wife ‘I think he should sell it’. It pissed me off. I never told them I sold it so they probably still think I own it . Lesson learned.

I’m not consistent but I’m trying to be 1) fully invested unless there is an exceptional reason not to be, 2) to ignore the noise and compelling doomsday macro predictions which are nearly always wrong, 3) to be patient and buy good companies when they are on sale, 4) to buy something I know and I’ve thought about owning before, this way I can stomach the swings, and to 5) hold it as for as long as there are no better opportunities. In terms of how that is implemented in practice Vinod1 recently described my thinking almost exactly. I don’t think I can write it up better than he did so here is what he wrote: After many years I’ve come to the same view as Vinod1. Sitting with a cash position hasn’t worked for me. When choosing a stock it has to be has to pass the ‘holy shit why are people not buying this’ gut check. If I’m cracking out the excel sheet and cranking numbers into a DCF just to make sure I’ve a ‘margin of safety’ then I almost certainly don’t have a margin of safety. It should be obvious. Generally I don't like small positions. I had a five bagger in a month once, but the position was less than 1% when I took it - so who tf cares - I was still poor. I normally size stocks at 10% - 25% but sometimes I’ve been 100% into a sector index that’s been hit by a wrecking ball. I’m generally adverse to leverage but I might use it one day. I’m not that old either so I can be fairly aggressive when an opportunity arises, but I’ll have to turn it down as the years slip by. I also don’t tell people the stocks I actively own. My insights aren’t that interesting, but more importantly it allows me to be detached from the stock. I can pull the cord on that sucker anytime I want and don’t have to defend that decision to anyone. If I’m pimping said stock it makes it much harder to sell it.

When you say not in the stock market yet what do you mean? When rates were rising we had a decent correct across stocks.

Was this meant for the indexing thread? Agree btw.

Yeh its not by much for sure. I am not cap weighted indexed right now because the Mag7 are just soo much of the index. I think there are times when it is better to be equal cap weighted and now might be one of them.