Castanza Posted October 21, 2024 Posted October 21, 2024 8 minutes ago, John Hjorth said: @Castanza is mean today, attempting to kill us all! - Great entertainment! I've been to too many whiskey nights with the boys where they pull up in their 60k Jeep Rubicon, talk about their 5 bedroom home (mind you no kids), bitch and complain about cost of living and salaries; but can't even answer what their 401k allocation percentage is lol.....it's mind numbing after a bit (and the whiskey doesn't help). Most bitching is self induced these days. We're all homeless, but some of us drive nice cars.
UK Posted October 21, 2024 Posted October 21, 2024 11 minutes ago, John Hjorth said: unproductive on a bank account, because 'everything else is 'too risky'' +1. And as time passes by, much more is lost in preparing for market crashes than in actual market crashes:)
Blugolds Posted October 21, 2024 Posted October 21, 2024 @Castanza your above post was good, when you're dealing with small sums that "hurt" if you lose it changes the emotion. I also have never understood (or maybe I understood early) that there really are only a couple variables that you completely control when investing. How much you sock away How long your timeline is to let it "work" If you are saving enough, even what many would consider mediocre returns add up and will provide satisfactory results, and if you give even modest sums long enough to compound (aka start as early as possible) it should provide satisfactory results. Probably the most common lack of focus is people getting the pot large enough to make a difference, they dont save enough or have enough disposable income to get a fat kitty. Instead they put that money toward to oversized home or fancy vehicle, so that when they do "invest", in order to have any meaningful results they would have to have returns that would put them in the .0001% of all investors in history, and thus the appeal of WSB brag posts. They start late in life and have a small pot, trying to work miracles, they want the winning lotto ticket. Again to your point, 401k allocation, nobody wants to play with compound interest calculators, have no idea what the rule of 72 is, no idea what an expense ratio is etc etc. Very very basic stuff but its not sexy like turning $1k into $100k in 6mo taking a flier on a "hot tip" that they saw/heard someplace and got in before the rest of the crowd. Also doesnt help that there is now, more than ever before, a plethora of exposure via social media showing them the mansions, exotic cars that resulted in buying a course, attending a seminar, paying a coach to get rich quick. Its like Ozempic for investing lol, nobody wants to put in the work when there is an easy way for them to get what they want without changing their behavior.
Fly Posted October 22, 2024 Posted October 22, 2024 3 minutes ago, UK said: The contrarian in me wants to load up on TLT after all these high profile interviews talking about shorting/zero exposure to bonds.
Sweet Posted October 22, 2024 Posted October 22, 2024 Why do all these guys believe inflation is going to come ripping back? I don’t get it. Is it because they learned their craft during the 80s when we had the double spike in inflation and they expect the same? Where is the evidence of ‘all roads lead to inflation’ because I don’t see it.
TwoCitiesCapital Posted October 22, 2024 Posted October 22, 2024 (edited) 21 minutes ago, Fly said: The contrarian in me wants to load up on TLT after all these high profile interviews talking about shorting/zero exposure to bonds. TLT has been killed in the last month - but what isn't clear to me is if its anything other than the September effect which has killed bonds in September/October in many of the past few years. Before September, I was pretty well diversified across short, intermediate, long duration and complimented that with spread and leveraged products for increased yield. At the end of August, I sold in- and at- the money calls with October expiries against my long duration instruments and got rid of my leveraged products. That played out well as duration got crushed. About two weeks ago, I sold the vast bulk of my short-term exposure and a chunk of my "spread" exposure and have rolled it to TLT & ZROZ for duration. If this is just another September effect, I think this will go quite nicely. Edited October 22, 2024 by TwoCitiesCapital
UK Posted October 23, 2024 Posted October 23, 2024 https://www.bloomberg.com/news/articles/2024-10-23/schwarzman-says-us-to-avoid-recession-no-matter-who-s-president?srnd=homepage-europe
UK Posted October 23, 2024 Posted October 23, 2024 https://www.bloomberg.com/news/articles/2024-10-22/jpmorgan-at-odds-with-goldman-sees-solid-run-ahead-for-stocks?srnd=homepage-europe Over at JPMorgan Chase & Co.’s asset and wealth-management divisions, analysts offer a more benign outlook. They’re anticipating that US large-cap equities — the big company stocks that have driven much of the recent gains — will remain a pillar of investors’ portfolios and return an annualized 6.7% over the next 10-15 years.
Eldad Posted October 23, 2024 Posted October 23, 2024 22 hours ago, Sweet said: Why do all these guys believe inflation is going to come ripping back? I don’t get it. Is it because they learned their craft during the 80s when we had the double spike in inflation and they expect the same? Where is the evidence of ‘all roads lead to inflation’ because I don’t see it. Because the US deficits now look like they are at the point of no return. 120% debt to GDP has historically been where most countries start to have problems. The US bond sell-off is concerning. Once the world knows that printing money is our only option, the inflation doom loop really starts.
gfp Posted October 23, 2024 Posted October 23, 2024 19 minutes ago, Eldad said: Because the US deficits now look like they are at the point of no return. 120% debt to GDP has historically been where most countries start to have problems. The US bond sell-off is concerning. Once the world knows that printing money is our only option, the inflation doom loop really starts. I wouldn't read too much into a one month bond sell-off.
Sweet Posted October 23, 2024 Posted October 23, 2024 24 minutes ago, Eldad said: Because the US deficits now look like they are at the point of no return. 120% debt to GDP has historically been where most countries start to have problems. Japan rewrote the script on debt and inflation so I’m not sure the link holds. I’m still of the view that the post covid inflation was largely as result of supply chains and not a monetary phenomenon. Although the stimulus checks didn’t help either.
Ulti Posted October 23, 2024 Posted October 23, 2024 22 hours ago, Sweet said: Why do all these guys believe inflation is going to come ripping back? I don’t get it. Is it because they learned their craft during the 80s when we had the double spike in inflation and they expect the same? Where is the evidence of ‘all roads lead to inflation’ because I don’t see it. https://podcasts.apple.com/us/podcast/grants-current-yield-podcast/id1207583745?i=1000673615724 one more guy who sees it
Eldad Posted October 23, 2024 Posted October 23, 2024 12 minutes ago, Sweet said: Japan rewrote the script on debt and inflation so I’m not sure the link holds. I’m still of the view that the post covid inflation was largely as result of supply chains and not a monetary phenomenon. Although the stimulus checks didn’t help either. Japan will collapse eventually. Supply Chains was 2021s lie I thought.
TwoCitiesCapital Posted October 23, 2024 Posted October 23, 2024 1 hour ago, Eldad said: Because the US deficits now look like they are at the point of no return. 120% debt to GDP has historically been where most countries start to have problems. The US bond sell-off is concerning. Once the world knows that printing money is our only option, the inflation doom loop really starts. Japan and Europe are both worse off and not THE reserve currency. Neither has really gone through a existential doom-loop yet. That isn't to say they wont, but I doubt the US goes first.
TwoCitiesCapital Posted October 23, 2024 Posted October 23, 2024 55 minutes ago, Sweet said: Japan rewrote the script on debt and inflation so I’m not sure the link holds. I’m still of the view that the post covid inflation was largely as result of supply chains and not a monetary phenomenon. Although the stimulus checks didn’t help either. Japan is absolutely having trouble. GDP growth has been minimal and its currency has dropped by 40-50% against the USD in the last 5-years. That is more akin to EM currency risk than a "flight to safety" asset that it has historically been characterized as.
Eldad Posted October 23, 2024 Posted October 23, 2024 30 minutes ago, TwoCitiesCapital said: Japan and Europe are both worse off and not THE reserve currency. Neither has really gone through a existential doom-loop yet. That isn't to say they wont, but I doubt the US goes first. True. America has entered the Bread and Circus period it feels like. Both parties competing to offer free stuff. It could take a long time but Inflation will most definitely be the policy of the US government from here on out. There is no other way.
thowed Posted October 23, 2024 Posted October 23, 2024 13 minutes ago, Eldad said: True. America has entered the Bread and Circus period it feels like. Both parties competing to offer free stuff. It could take a long time but Inflation will most definitely be the policy of the US government from here on out. There is no other way. Certainly feels like this at the moment.
Castanza Posted October 23, 2024 Posted October 23, 2024 You don't have to outrun the bear, you just have to outrun everyone else.
Gregmal Posted October 23, 2024 Posted October 23, 2024 Geez it’s like every time we have a 1-2% drop the same old stuff starts up again
Spekulatius Posted October 24, 2024 Posted October 24, 2024 7 hours ago, TwoCitiesCapital said: Japan and Europe are both worse off and not THE reserve currency. Neither has really gone through an existential doom-loop yet. That isn't to say they wont, but I doubt the US goes first. Europe government deficits are restraint (Germany is at 2.1% of GDP, USA is in excess of 6% and that with economy booming). Both candidates are inflationary based on their policies, especially Trump. I think chances are pretty good that we see some raises from the Fed after a few cuts this year. Depends on how the economy is going after the election.
UK Posted October 24, 2024 Posted October 24, 2024 10 hours ago, TwoCitiesCapital said: Japan and Europe are both worse off and not THE reserve currency. Neither has really gone through a existential doom-loop yet. That isn't to say they wont, but I doubt the US goes first. +1
UK Posted October 24, 2024 Posted October 24, 2024 9 hours ago, Castanza said: You don't have to outrun the bear, you just have to outrun everyone else.
UK Posted October 24, 2024 Posted October 24, 2024 3 hours ago, Spekulatius said: Europe government deficits are restraint (Germany is at 2.1% of GDP, USA is in excess of 6% and that with economy booming). Just look at Italy or even France then:). I think this problem will emerge sooner or later and it will be much larger than with Greece. Perhaps Japan will hit the limits first though.
mattee2264 Posted October 25, 2024 Posted October 25, 2024 I think there are a few reasons why US deficits have yet to be inflationary: -There's been a very beneficial supply side impact from cheap immigrant labour which has helped to avoid a wage-price spiral -Despite that massive stimulus the US economy isn't running hot by any means -Commodity prices have dropped off significantly because of China weakness and sluggish global economy ex USA generally -A lot of the spending has been very unproductive e.g. adding to government payroll, paying interest, various vanity projects so hasn't really been filtering into the real economy in the same way the stimulus checks (which contributed to the first wave of inflation) did -Full employment is a bit of a misleading concept because it ignores individuals who have dropped out of the labour force
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