Parsad Posted June 6, 2023 Author Posted June 6, 2023 Should we lock this thread and move to the "Have We Reached The Top" thread? The bottom hit pretty much in June 2022 and then again in October 2022. S&P500 is up about 17% from the October 14, 2022 bottom and the Nasdaq is up almost 25% during the same period. I certainly don't think this will be a straight forward market for the next 18-24 months, but you had two good buying opportunities last year and markets are up...especially tech. Time to let the market run until it hits a top and people fret about something else. To me, I think it's going to be CRE and RRE...as well as possible sovereign debt issues around the world...but those may be a year or so away. Cheers!
mattee2264 Posted June 7, 2023 Posted June 7, 2023 I am more inclined to think the market will continue to be range bound/trade sideways as momentum in technology stocks offsets any further weakness in cyclicals. And probably by the time the tech rally runs out of steam and there is a correction there will be grass shoots in the economy and a rotation into cyclicals will keep the market afloat. It does seem almost certain that 3500 last year was the bottom for this cycle.
UK Posted June 7, 2023 Posted June 7, 2023 10 hours ago, Parsad said: Should we lock this thread and move to the "Have We Reached The Top" thread? The bottom hit pretty much in June 2022 and then again in October 2022. S&P500 is up about 17% from the October 14, 2022 bottom and the Nasdaq is up almost 25% during the same period. I certainly don't think this will be a straight forward market for the next 18-24 months, but you had two good buying opportunities last year and markets are up...especially tech. Time to let the market run until it hits a top and people fret about something else. To me, I think it's going to be CRE and RRE...as well as possible sovereign debt issues around the world...but those may be a year or so away. Cheers! Technically, we should wait until +20 from the bottom before moving, but maybe it would be more convenient to just merge both threads into one "Have We Reached The Top/Bottom":)))
james22 Posted June 7, 2023 Posted June 7, 2023 1 hour ago, UK said: Technically, we should wait until +20 from the bottom before moving, but maybe it would be more convenient to just merge both threads into one "Have We Reached The Top/Bottom":))) I suppose we’ve reached the technical definition of a bull market since the stock market is now 20% off the lows . . . https://awealthofcommonsense.com/2023/06/is-this-a-new-bull-market/
Spooky Posted June 7, 2023 Posted June 7, 2023 13 hours ago, Parsad said: Should we lock this thread and move to the "Have We Reached The Top" thread? The bottom hit pretty much in June 2022 and then again in October 2022. S&P500 is up about 17% from the October 14, 2022 bottom and the Nasdaq is up almost 25% during the same period. I certainly don't think this will be a straight forward market for the next 18-24 months, but you had two good buying opportunities last year and markets are up...especially tech. Time to let the market run until it hits a top and people fret about something else. To me, I think it's going to be CRE and RRE...as well as possible sovereign debt issues around the world...but those may be a year or so away. Cheers! Agreed. It seems like we are back into momentum / fomo for the big tech stocks / QQQ which could run for a while. Still looks like a stock pickers market to me - avoid the S&P 500 and new magnificent 7 (or whatever we want to call them). I have been adding to the S&P 600 in my retirement account but even that is starting to move upwards.
Intelligent_Investor Posted June 7, 2023 Posted June 7, 2023 5 hours ago, mattee2264 said: I am more inclined to think the market will continue to be range bound/trade sideways as momentum in technology stocks offsets any further weakness in cyclicals. And probably by the time the tech rally runs out of steam and there is a correction there will be grass shoots in the economy and a rotation into cyclicals will keep the market afloat. It does seem almost certain that 3500 last year was the bottom for this cycle. When the S&P was at 3500 people were saying it was going to 2300 even on this forum lol fear really does spread like wildfire
Dalal.Holdings Posted June 7, 2023 Posted June 7, 2023 https://www.bloomberg.com/news/articles/2023-06-07/druckenmiller-says-he-could-own-nvidia-for-years-bloomberg-invest?srnd=premium Quote Billionaire Stan Druckenmiller said he expects that AI is here to stay, and that he anticipates owning shares of Nvidia Corp. for several more years. Remember, this is the guy that went all in at the top of the tech bubble and got fired by Soros for it. It's not a story that Druck worshippers would tell you...
Spekulatius Posted June 7, 2023 Posted June 7, 2023 22 hours ago, Parsad said: Should we lock this thread and move to the "Have We Reached The Top" thread? The bottom hit pretty much in June 2022 and then again in October 2022. S&P500 is up about 17% from the October 14, 2022 bottom and the Nasdaq is up almost 25% during the same period. I certainly don't think this will be a straight forward market for the next 18-24 months, but you had two good buying opportunities last year and markets are up...especially tech. Time to let the market run until it hits a top and people fret about something else. To me, I think it's going to be CRE and RRE...as well as possible sovereign debt issues around the world...but those may be a year or so away. Cheers! I think the better idea would be just to open a market direction discussion thread each year - clal it "Market direction discussion thread 2023 etc"
dealraker Posted June 7, 2023 Posted June 7, 2023 (edited) It was just yesterday that we were immensely enjoying the change/Greg debate, change was doing 1000 word inflation doomsday warnings and Greg was responding with the standard Roy Kent (Ted Lasso) brevity. And now multiple trillions of upside later I was just now watching Roland Garros tennis, swapped over to CNBC and some guest money manager dude's telling us the AI tech rally is just beginning...the rocket ship is fueled for explosive upside. Damn...I just watch and read. I don't know nuthin'. Edited June 7, 2023 by dealraker
Spooky Posted June 7, 2023 Posted June 7, 2023 42 minutes ago, Intelligent_Investor said: We call them MAGMA now
Gregmal Posted June 7, 2023 Posted June 7, 2023 (edited) Also recall in January we had like a 5% up move or so on the indexes and it was an ultra popular idea to lock in your yearly gains and go grab some “juicy” 5% treasuries…. I still don’t get out of bed for 5%. Even 10 is hard to get excited about. Edited June 7, 2023 by Gregmal
dealraker Posted June 7, 2023 Posted June 7, 2023 Reading this thread for some time has me thinking that we, those of us participating here, are different in the field of what information we use to make investment decisions. It really isn't so much something as simple as agreement or disagreement, it is or may be the personal nature within us as to what's relevant or not. I think we also as a group tend to differ on how long out we are peering, thus things that may be cruicial for some to take advantage of - or be fearful of - that others may just find somewhat irrelevant. Some may have to "keep score" more often, else possibly lose clients. Some are far less interested in the score on a regular - more often - basis. And we can and do have these differences on the very same choices of stocks. So it is interesting particularly if you seek to have others agree with you...because it won't happen. And it won't happen not because they necessarily disagree with you, it is simply that the information and the timeline that's so incredibly essential for your scorekeeping...well, it may be irrelevant for theirs. An example is that I never agreed/disagreed with the information change was presenting, I just do not and never have made a decision based on that type info. I can't, it isn't within me to do that. This isn't a put down of his presentations, they were quite enjoyable for me to read and think about. I read them all as a matter of fact.
Gregmal Posted June 7, 2023 Posted June 7, 2023 I THINK a Ferrari is “too expensive”. So I’m going to spend my whole life refusing to own one until they reach a point where I can get one for the price of a Honda. Maybe once every blue moon I do get to buy one, but more often and frequently than not, by a huge margin, I don’t get one. Conclusion? A Ferrari is not a Honda. And maybe Ferraris are not for everyone. Because more often than not, the price you see is what it costs to own a Ferrari. The price is right and I am the one who needs to mentally get with the program. As far as what is a satisfactory return? What’s a year of your life worth? Definitely not 5-10%.
TwoCitiesCapital Posted June 7, 2023 Posted June 7, 2023 (edited) 2 hours ago, Intelligent_Investor said: When the S&P was at 3500 people were saying it was going to 2300 even on this forum lol fear really does spread like wildfire For me it's less fear and more opportunity and attempting to maximize returns. Everything basically says caution is warranted EXCEPT stock prices. Why would I pay 19x falling earnings? Especially when I think those earnings are abnormally high due to elevated margins, elevated leverage, elevated liquidity, and just-in-time inventory systems that are fundamentally evolving? Why pay above average multiples in an unstable inflation environment which is historically where we've seen below average multiples? Why get a 4% and declining earnings yield on equities if I can get 5-7% easily in fixed income markets with little-to-no duration or credit risk? It's not fear that's driving me away from stocks. It's common sense. I'm still buying some - like cyclicals/material companies that ARE priced for a significant slowdown. But crash or no, I expect most fixed income to outperform most equities over the next few years and so fixed income is the market im playing in. Edited June 7, 2023 by TwoCitiesCapital
Sweet Posted June 7, 2023 Posted June 7, 2023 I think a lot of the problems with the stocks dropping much further was the assumption that there hasn’t been a recession and we still had to bottom. Taken as a probably, the chances of a 50% drawdown are low. I still think the next 10 years aren’t going to be nearly as easy as the last 10, although as ever you can pick your spots.
mattee2264 Posted June 7, 2023 Posted June 7, 2023 (edited) Yeah while there's been another V shaped recovery in stock prices extending the secular bull market even longer it probably comes at the cost of much lower prospective real returns over the next decade. At least for index buyers. But if you avoid Big Tech and pick your spots you can probably do a whole lot better. EAFE for example is trading at 13x forward earnings compared to 18x forward earnings for the US stock market and EM is trading at 12x forward earnings. And if there is some kind of AI productivity growth miracle those markets would probably do very well over the next 10-20 years. Edited June 7, 2023 by mattee2264
maxthetrade Posted June 7, 2023 Posted June 7, 2023 I really don't understand this obsession with where the markt goes. There are almost always some cheap stocks where you can make a killing. VTS is almost a double for me, FFH is up ~25% YTD, KMX is up ~30% YTD. Recently I loaded up on USB and DG (I'm surprised there's no discussion of this name). I couldn't care less what the indices do.
John Hjorth Posted June 7, 2023 Posted June 7, 2023 25 minutes ago, mattee2264 said: ... But if you avoid Big Tech and pick your spots you can probably do a whole lot better. To me, it's amazing and mind provoking to read something like this here on CoBF. Nobody really knows, but everybody is opinionated on the matter, except me, I think.
rkbabang Posted June 7, 2023 Posted June 7, 2023 12 minutes ago, John Hjorth said: To me, it's amazing and mind provoking to read something like this here on CoBF. Nobody really knows, but everybody is opinionated on the matter, except me, I think. Macro predictions are fun to read. Nobody knows, everyone will admit that nobody knows, ... yet everyone still thinks they know.
Ulti Posted June 7, 2023 Posted June 7, 2023 20 hours ago, Parsad said: Time to let the market run until it hits a top and people fret about something else. To me, I think it's going to be CRE and RRE https://www.msn.com/en-us/money/companies/the-next-crisis-will-start-with-empty-office-buildings/ar-AA1ceEKg?ocid=msedgdhp&pc=U531&cvid=606d641185224a20a6248989fb2c9e82&ei=10
bizaro86 Posted June 7, 2023 Posted June 7, 2023 1 hour ago, maxthetrade said: I really don't understand this obsession with where the markt goes. There are almost always some cheap stocks where you can make a killing. VTS is almost a double for me, FFH is up ~25% YTD, KMX is up ~30% YTD. Recently I loaded up on USB and DG (I'm surprised there's no discussion of this name). I couldn't care less what the indices do. Start a DG thread with your thoughts! I'd be super interested in reading it. Took a quick look and think it looks potentially excellent, cheap/quality. Big recent drop.
Red Lion Posted June 7, 2023 Posted June 7, 2023 Thanks for bringing up the DG idea, I didn't realize it had dropped off the cliff since I have never actually taken the plunge to invest in this sector. +1 to starting a DG thread.
Parsad Posted June 7, 2023 Author Posted June 7, 2023 4 hours ago, Gregmal said: I THINK a Ferrari is “too expensive”. So I’m going to spend my whole life refusing to own one until they reach a point where I can get one for the price of a Honda. Maybe once every blue moon I do get to buy one, but more often and frequently than not, by a huge margin, I don’t get one. Conclusion? A Ferrari is not a Honda. And maybe Ferraris are not for everyone. Because more often than not, the price you see is what it costs to own a Ferrari. The price is right and I am the one who needs to mentally get with the program. As far as what is a satisfactory return? What’s a year of your life worth? Definitely not 5-10%. +1! Great analogy! Cheers!
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