Have We Hit The Top?

[Gamecock-YT]

1 hour ago, Spekulatius said:

The Republican Party equals Trump now and Trump definitely does not want to reduce spending. Dems and Reps will just spent on different things but they both will spend.

 

handouts to their base. At least in India you used to get a toaster or a TV out of the deal. 

[UK]

https://www.bloomberg.com/news/articles/2024-08-08/jpmorgan-says-three-quarters-of-global-carry-trades-now-unwound

https://www.bloomberg.com/news/articles/2024-08-07/fast-money-quants-are-hammered-after-everything-went-wrong

Edited August 8 by UK

[mattee2264]

What is clear is that neither party has any intention of fiscal restraint. And unlike in Europe the markets won't discipline the USA for that in any meaningful way.

 

That probably does mean that we will have higher for long interest rates (although there may be some easing over the next year if the economy continues to weaken) unless the much anticipated AI productivity miracle materializes 

[Gregmal]

Its kinda wild seeing how much these stupid monkeys are bidding up/down the market on these single, minor data releases the last couple weeks. Folks need to take a break. Grab a Bloody Mary and hit the beach...if your year comes down to scrupulously micromanaging August jobs data then you're doing something wrong. 

[Spekulatius]

10 hours ago, Gregmal said:

Its kinda wild seeing how much these stupid monkeys are bidding up/down the market on these single, minor data releases the last couple weeks. Folks need to take a break. Grab a Bloody Mary and hit the beach...if your year comes down to scrupulously micromanaging August jobs data then you're doing something wrong. 

The news are just the trigger, just like Yen carry trade thingy. The real reason is that there are ton of momentum investors in this market. At least that’s what I am thinking.

[adesigar]

On 8/7/2024 at 9:19 PM, Blake Hampton said:

This is a great point. Dems and Reps are really just two sides of the same coin where they offset themselves financially with both their respective policies. Dems want to increase taxes but also want to spend, and Reps want to decrease spending but also want to decrease taxes. Really what we need is a less bipartisan congress that can actually come to an agreement on something. I guess that’s easier said than done.

Need Democrats in charge of taxes and Republicans in charge of spending.

[Malmqky]

6 hours ago, adesigar said:

Need Democrats in charge of taxes and Republicans in charge of spending.

Have the recent batch of republicans even been better than democrats when it comes to spending?

 

Seems to me like democrats like to tax and spend and republicans like to cut taxes and spend anyways these days..

[bargainman]

On 8/9/2024 at 7:13 AM, Malmqky said:

Have the recent batch of republicans even been better than democrats when it comes to spending?

 

Seems to me like democrats like to tax and spend and republicans like to cut taxes and spend anyways these days..

Yup.  No body wants to pay the piper.  It's been a crazy couple of decades though with the financial crisis and pandemic.  Both of those had a significant impact on spending and debt iirc.  Not sure how the US gets out of this mess other than to inflate.

[Castanza]

On 8/9/2024 at 3:22 AM, adesigar said:

Need Democrats in charge of taxes and Republicans in charge of spending.

 

Only if we can have a Libertarian (or Independent) audit committee that gets to review all budget changes, administration bloat, department creation, social programs, tax changes, defense spending etc.

 

Let them come in every 5 years, audit everything and determine if said program or tax has been effective and whether or not it should stay. Slash it, slash it, slash it!

[Intelligent_Investor]

Spend will never be fixed. America is obsessed with debt and apparently cutting debt is evil. If you suggest not taking on debt the average American will get really upset. Its become a way of life in the US.

[Spooky]

Was camping in the back country  last week and missed all the drama! Looking at prices things don’t seem off significantly. There is definitely something to be said about not looking at short term market activity.

[adesigar]

Imagine if the idiots in DC allowed Investing social security funds and other government funds in the stock market like the Norway and Singapore sovereign funds would the USA even need to take on debt.

[Blake Hampton]

1 hour ago, adesigar said:

Imagine if the idiots in DC allowed Investing social security funds and other government funds in the stock market like the Norway and Singapore sovereign funds would the USA even need to take on debt.

Sounds to me like the foundation for a super bubble. Government mindlessly investing mass amounts of money into stocks doesn’t seem to me like a good idea, but I sort of feel the same way about index funds. Index funds though are invested on a personal basis, social security isn’t.

[Gregmal]

Why? Wouldnt it be more likely that overall, market participants are just realizing superior assets as such?

[John Hjorth]

9 minutes ago, Blake Hampton said:

Sounds to me like the foundation for a super bubble. Government mindlessly investing mass amounts of money into stocks doesn’t seem to me like a good idea, but I sort of feel the same way about index funds. Index funds though are invested on a personal basis, social security isn’t.

 

2 hours ago, adesigar said:

Imagine if the idiots in DC allowed Investing social security funds and other government funds in the stock market like the Norway and Singapore sovereign funds would the USA even need to take on debt.

 

Not neccessarily a foundation for a superbubble, if thought and setup the right way, Blake [ @Blake Hampton ].

 

The Norwegian 'Government Pension Fund Global' may be worth your time and attention for further study and deeper understanding.

 

The economic foundation and basis for the fund is an extra 50 percent points on the taxable income of Equinor [earlier Statoil] as a common and broad political decision back when Norwegian oil venture stated [in the '60s, I think], where this separate tax revevue stream [the separate 50 percent points] not are included in the state budget, but are separated, saved and invested for the very long term, all in separate entity [called Norges Bank Investment Management], which is not controlled by the Norwegian political system, so idiots cant get any stupid ideas with about what to do with all the money.

 

Only in years when economic conditions have been sour has it been alloved to transfer parts af the return on the saving back to the state for inclusion in the budget.

 

As far as I can see will Norway gradually evolve [over some few decades] to a society where the working share of the population will shrink to fewer and fewer capita, because taxation of working income will not be needed to make ends meet in the state budget.

 

It's indeed mindboggling to think about.

 

Link : Norges Bank Investment Management.

Link : Wikipedia page: Government Persion Fund Global

 

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Now back to 'have we hit the top' and whatnot.

[Gregmal]

To a hammer, everything is a nail. I’ve literally heard “bubble” screamed every year since 2011….

[Xerxes]

30 minutes ago, John Hjorth said:

 

 

Not neccessarily a foundation for a superbubble, if thought and setup the right way, Blake [ @Blake Hampton ].

 

The Norwegian 'Government Pension Fund Global' may be worth your time and attention for further study and deeper understanding.

 

The economic foundation and basis for the fund is an extra 50 percent points on the taxable income of Equinor [earlier Statoil] as a common and broad political decision back when Norwegian oil venture stated [in the '60s, I think], where this separate tax revevue stream [the separate 50 percent points] not are included in the state budget, but are separated, saved and invested for the very long term, all in separate entity [called Norges Bank Investment Management], which is not controlled by the Norwegian political system, so idiots cant get any stupid ideas with about what to do with all the money.

 

Only in years when economic conditions have been sour has it been alloved to transfer parts af the return on the saving back to the state for inclusion in the budget.

 

As far as I can see will Norway gradually evolve [over some few decades] to a society where the working share of the population will shrink to fewer and fewer capita, because taxation of working income will not be needed to make ends meet in the state budget.

 

It's indeed mindboggling to think about.

 

Link : Norges Bank Investment Management.

Link : Wikipedia page: Government Persion Fund Global

 

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Now back to 'have we hit the top' and whatnot.

thank you. I find Norway’ way to deal with the resource curse fascinating. I don’t know if Alberta ever setup something similar. Or maybe it was too much of a socialist idea. 
 

Sovereign funds are fascinating. Then you have cases like PIF where the government “accelerate contribute” by moving assets from Aramco to PIF. 
 

different thread I suppose 

[Castanza]

4 hours ago, adesigar said:

Imagine if the idiots in DC allowed Investing social security funds and other government funds in the stock market like the Norway and Singapore sovereign funds would the USA even need to take on debt.

 

Imagine if they just let us opt out of contributions and invest our own money. Social Security is a pretty poor return when looking at how much you contribute vs draw.

[Blake Hampton]

It couldn't be a lump-sum deal and it would have to gradually revert to fixed-income like a lifecycle fund, but it might be able to work. I just have a perceived problem, possibly irrational, with mindless investment that has no fixation on underlying fundamentals. Over time, indexes average out to returns that are relatively simple to forecast from the onset. Is it possible though that money could keep flowing into an index without there ever being a huge correction? What is the longest period after an index drops for it to reach all-time highs again?

 

It is just the simple nature of fixed income vs the stock market. The income from treasuries is fixed and certain whereas the returns from stocks aren't.

[John Hjorth]

3 hours ago, Xerxes said:

thank you. I find Norway’ way to deal with the resource curse fascinating. I don’t know if Alberta ever setup something similar. Or maybe it was too much of a socialist idea. 
 

Sovereign funds are fascinating. Then you have cases like PIF where the government “accelerate contribute” by moving assets from Aramco to PIF. 
 

different thread I suppose 

 

Off topic,

 

@Xerxes,

 

The historical tax revenue stream to the Danish State [It was called a separate tax on carbonhydroxids] - imposed on A. P. Møller-Maersk A/S and its partners in DUC - an enormous amount of money over the years - several hundreds of billions of DKK - on the oil and gas exploration in the Danish part of the waters ofthe North Sea - is basically today gone, vanished, spent [on toilet paper and the likes BS, by Danish idiotic politicians].^[1]

 

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I'll do my best to remember to open a separate topic such sovereign funds in the coming autumn. As you said, it's a fascinating topic.

 

Back to topic.

 

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^[1] A tiny part that gluttony was likely to provide free college studies and 5 years university studies to M.Sc. level for me - a part of the total capital allocation, on which I naturally concur. [  ]

[vinod1]

I think there is a fundamental misunderstanding of how Social Security works in a large economy. Not small national states.

 

Social security could have $50 trillion in stocks and bonds and it makes no difference in reality to how much can be paid out.

 

SS transfers the purchasing power from current workers to retirees. If SS taxes are not collected, it just leads to inflation. Someone has to work and take a pay cut (losing some of the purchasing power by paying SS taxes).

 

Imagine 100% of the country is retired and on SS. SS fund is worth $200 trillion. The govt starts paying everyone and no one needs to work. Someone needs to collect the garbage, produce goods, etc.

 

Vinod

 

 

[Spekulatius]

The important thing about Norway is that they did not invest the trust fund in Norway, the assets are widely distributed over the investable universe worldwide.

 

If they had invested predominantly in Norway , they would have created a super bubble.

[Gregmal]

Anyone got wagers on how mouthy the “stagflation” bros get tomorrow if we get a backwards looking CPI print one tenth of one percent or two above “expectations”…

[73 Reds]

7 hours ago, Gregmal said:

Anyone got wagers on how mouthy the “stagflation” bros get tomorrow if we get a backwards looking CPI print one tenth of one percent or two above “expectations”…

Yep, it's amazing how carried away folks get about every reported piece of economic data.  Personally, I've never paid attention to any of it and these data points have never affected an investment decision because in hindsight it's all just noise anyway.  Even if one trades off these data points for short term swings, how much better do you do in the long run than someone who simply buys and holds great investments?     In fact, I've never met a successful day-trade type individual, and even if they do make money, would they have been better off simply investing for the long run and devoting their time to something more productive?

[John Hjorth]

53 minutes ago, 73 Reds said:

Yep, it's amazing how carried away folks get about every reported piece of economic data. ...

 

It's an economic main stream media thingy / phenomen, it's all about clicks, subscriptions, also as a basis attracting advertising, and thereby advertising income, etc.

 

Next, the people in all kind of financial institutions responsible for sales, assets under management, fees and commisions set in on how they are there for you to help you out of your actual misery from what other  or maybe yourself may have done of harm to your self related to your actual situation [just to get the opportunity fleece you, that is].

 

Simultaneously and together with those first and second waves of gobbling you have members and participants in the political systems everywhere venting their stances on this and that that is actually up for discussion, with 'this can't be right, this is not going to end up well, -we absolutely need to take decisive actions to avoid the future consequenses of that - now!'.

 

Turkey farm behavior and pattern all over it :

 

 

 

That said, for the last few years that I've had a subscription on Economist, I read and scrutinize the byweekly tables of Economic & financial indicators and Makets data, which provides a great pushback on all the 'Turkey noise', ref. above, because you get data, - data with no comments and no noise attached, and gradually one gets an overall feeling how certain parts or countries in world are doing, which matters to me, for my basic understanding of local conditions at given location on the planet.

Edited August 14 by John Hjorth
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