Political Posts

[lnofeisone]

5 minutes ago, Milu said:

I was thinking it would be down somewhere in the 5-10% range so a bit higher than I expected. While I think there was some brand damage I think the model y redesign and its rollout dates for q2 may have caused a lot of European buyers to hold off. 

US and China are driving Tesla's sales. Europe, while important, isn't that big of a slice. With economic uncertainty in the US and intense competition in China, Tesla's sales are expected to face some turbulence. Q2 will be very telling. Who knows where the stock will go but I might just pick up some OTM puts here. 

[Red Lion]

1 hour ago, dwy000 said:

You're not actually suggesting that higher interest rates leads to higher inflation are you?

I’m suggesting that it can and has lead to higher inflation of certain items (housing being an example). Not that they lead to higher inflation overall. I specifically didn’t make a comment about whether they lead to higher inflation on average.
 

do you believe higher interest rates never have the capacity to lead to higher inflation in any circumstance? 

[Red Lion]

1 hour ago, Sweet said:

But interest rates rises tighten which is deflationary.  This works two ways.

Agreed that it works two ways. That was what I was attempting to express. 

[Gregmal]

19 minutes ago, Red Lion said:

I’m suggesting that it can and has lead to higher inflation of certain items (housing being an example). Not that they lead to higher inflation overall. I specifically didn’t make a comment about whether they lead to higher inflation on average.
 

do you believe higher interest rates never have the capacity to lead to higher inflation in any circumstance? 

It’s crazy how people think so statically. Everything is situational and has evolving variables. 

[Luke]

After having posted much in this thread, I wanted to update my thoughts on the current developments:

 

I was advocating to not overinvest into the military as the EU on which i changed my mind. I think Trump trying to go for Greenland is just one additional threat to europe and the EU and we really need to make sure we can match not only Russia and China but also now the US. I now think we have to really up the investments and also start drafting more people into the military asap. Regarding Ukraine, I think we got drawn into a geopolitical game by the US that was not in our interest. I still think we should continue negotiations and in the case of ukraine do less nationbuilding. So there i have not changed my mind that much. I just realized how much a threat the US now is which i really underestimated. I think China can be ignored militarily but not economically.

 

 

[LC]

Are our memories so short that we forget 5%+ inflation prints a few years ago? This is what caused FRB to raise rates.

 

I still don't understand the criticism of Powell. He's done a great job IMO.

[dwy000]

19 minutes ago, Red Lion said:

I’m suggesting that it can and has lead to higher inflation of certain items (housing being an example). Not that they lead to higher inflation overall. I specifically didn’t make a comment about whether they lead to higher inflation on average.
 

do you believe higher interest rates never have the capacity to lead to higher inflation in any circumstance? 

My question was to Greg's reply.

 

Higher interest rates don't make housing more expensive directly, they raise the cost of financing that house.  The house price is unchanged.  And for existing goods (housing, used cars etc) it often leads to lower prices to offset the higher interest charges.  The entire point of interest rate increases is to dampen demand (and therefore price increases) by making the cost (not the good itself, the cost) less attractive while making savings more attractive.

 

While there may be the odd circumstance where higher rates leads to higher prices (and i cant think of one off the top of my head), it's generally short term reactionary.  No economy would ever raise interest rates in expectation of increasing prices.  

 

But come on.  You guys are not stupid, you do a lot of detailed analysis. You know this!  It's not statistical, it's reality.  Greg appears to be arguing it because of a hatred for Powell and being long real estate.  Thats not reason to throw common sense out the window.

[Gregmal]

1 minute ago, dwy000 said:

Higher interest rates don't make housing more expensive directly, they raise the cost of financing that house.  The house price is unchanged.  And for existing goods (housing, used cars etc) it often leads to lower prices to offset the higher interest charges.  The entire point of interest rate increases is to dampen demand (and therefore price increases) by making the cost (not the good itself, the cost) less attractive while making savings more attractive.

This is exactly my point. Powell thought on a basic, first level academic sense that ignores a decade of under building, a Covid period that invigorated demand for personal space and property, and a prolonged period of low rates. It’s was soooo obvious what was gonna happen. And what happened is he made housing more expensive for the majority of the population. Doesn’t matter if it “technically” didnt raise the all cash price @Red Lion and I were paying when competition started dropping like flies. Powell totally fucked the common man because he got drunk on attention from the hedge fund guys in 2022 screaming “it’s their mandate!”…even though the supply and demand of Spaghetti-Os was gonna take care of itself regardless of what he did.

[dwy000]

Just now, Gregmal said:

This is exactly my point. Powell thought on a basic, first level academic sense that ignores a decade of under building, a Covid period that invigorated demand for personal space and property, and a prolonged period of low rates. It’s was soooo obvious what was gonna happen. And what happened is he made housing more expensive for the majority of the population. Doesn’t matter if it “technically” didnt raise the all cash price @Red Lion and I were paying when competition started dropping like flies. Powell totally fucked the common man because he got drunk on attention from the hedge fund guys in 2022 screaming “it’s their mandate!”…even though the supply and demand of Spaghetti-Os was gonna take care of itself regardless of what he did.

He didnt make housing more expensive, he made the building of new housing more expensive.  And of course spaghetti-os would take care of themselves eventually (just like housing) but it's a question of how long and how much they would end up costing.  There isn't an economy in the world that hasn't seen high inflation rates be massively detrimental and it's a continuing cycle unless you do something about it.  

 

Turkey tried the "let's just let inflation play out" for a while. Disaster. I can't think of one where that actually worked out. 

[Sweet]

Powell didn’t fuck the common man.  Covid policies by governments, rightly or wrongly, was the start of inflation.

 

Historically low interest rates helped bid house prices for 15 years.  That almost certainly made homes much more unaffordable than Powell returning rates to the long term average.

 

Did he do so because he was drunk on the attention of hedge funds?  No evidence to suggest that.  And it’s counter factual to what I saw which was many hedge fund guys telling him he needed to raise rates while he refused:

https://www.cnbc.com/amp/2021/10/29/bill-ackman-calls-for-the-fed-to-start-raising-interest-rates-as-soon-as-possible.html

Edited April 2, 2025 by Sweet

[Sweet]

58 minutes ago, Red Lion said:

Agreed that it works two ways. That was what I was attempting to express. 

I understand.  The increase in financing costs to get a mortgage as a result of rate rises are short term.  Medium to longer term it works in the opposite direction.  
 

Low rates bid house prices up, people can keep bidding the house when interest rates are low - so when rates do rise and sellers won’t cut prices, what’s to blame?

 

The ‘higher’ rates (historically average rates) or lower rates (historically low) that helped bid up house prices in the first place.

[cubsfan]

Higher rates killed housing for the young. It absolutely destroyed them. Then rents went through the roof as a result, putting the American dream out of reach for gen Z.  It was such a disaster, many of them continued to live at home with their parents.

[Gregmal]

Agreed. Jerry made a shitty DR Horton 3/2 a luxury item. God bless the establishment lol

[dwy000]

2 minutes ago, Gregmal said:

Agreed. Jerry made a shitty DR Horton 3/2 a luxury item. God bless the establishment lol

Wouldn't JOE be the biggest beneficiary of higher rates then?  

[Gregmal]

1 minute ago, dwy000 said:

Wouldn't JOE be the biggest beneficiary of higher rates then?  

A lot less sensitive to rates than conventional wisdom would say. Same goes for home prices. Touched on this in the thread. 

[dwy000]

3 minutes ago, Gregmal said:

A lot less sensitive to rates than conventional wisdom would say. Same goes for home prices. Touched on this in the thread. 

Ok, but shouldn't they be hoping and pushing hard for higher rates if it leads to higher home prices?  

[Sweet]

Cubs and Greg, house prices have been out of reach for young people for wayyy longer than Powell raising rates.

 

https://amp.cnn.com/cnn/2021/03/23/opinions/millennials-almost-impossible-to-afford-home-olson

 

^ That was before rate rises.

 

Low rates jacked house prices up, nearly everyone knew this was happening, few of those that owned real estate cared, and nobody did anything about it.

[Gregmal]

4 minutes ago, dwy000 said:

Ok, but shouldn't they be hoping and pushing hard for higher rates if it leads to higher home prices?  

They sell to builders and wealthy folks whom build homes and most counter parties pay cash.
 

If builders need volume then they need financing costs to come down. Most RE developments, just look at MF, use some form of leverage. As long as that remains prohibitive not much is gonna get done about the whole supply and demand problem. We “almost” had a MF building spree that crashed the market for those assets with ungodly amounts of supply….almost. But Jerry came to the rescue. 

[LC]

2 hours ago, lnofeisone said:

Who knows where the stock will go but I might just pick up some OTM puts here. 

Ah, the siren sings yet again

[Paarslaars]

Bad orange man bad!

[Spooky]

Reciprocal tariffs just seems lazy.

[Sweet]

 

Edited April 2, 2025 by Sweet

[dwy000]

4 minutes ago, Spooky said:

Reciprocal tariffs just seems lazy.

It's very confusing. Canada has stated their willing to get rid of all tarriffs if US did the same. Thats reciprocal.  So why is Trump putting tarriffs on things that are not reciprocal but calling it reciprocal?  

 

Edit: actually Canada and Mexico don't even show up on that list.  Is this specific products?  

Edited April 2, 2025 by dwy000

[Sweet]

Interesting polling

[Gregmal]

1 minute ago, Sweet said:

Interesting polling

People are morons. Haven't we seen? We can't even admit Disney shit the bed with its market cuz ...."MY TEAM!". 

 

Gonna be time to checkout soon.