Is The Bottom Almost Here?

[changegonnacome]

19 hours ago, Parsad said:

If the U.S. continues to raise rates, and other countries are forced to defend their currencies by selling off more and more USD reserves, it means higher and higher rates for U.S. debt issuances as they roll over maturing debt. 

 

Yep natural overseas buyers of MBS's etc. could turn easily turn into sellers but certainly stop buying new issuances, just as the Fed is also selling.......and then well you've got the banks who used to step into this stuff but not so much any more since Dodd-Frank.........guess we are going to see the unintended consequences of all the re-tooling of financial system that was done post-08......the problem with shadow banks versus real banks.....is the shadows ones go AWOL in a crisis

[Gregmal]

We re staring at deflation everywhere and the Fed is mouth breathing about jobs and rent which are lagging indicators. 

[changegonnacome]

 

[Xerxes]

14 minutes ago, Gregmal said:

We re staring at deflation everywhere and the Fed is mouth breathing about jobs and rent which are lagging indicators. 

 

Isn't that the whole point of being "inflation hawk" ... more about the take-no-prisonner optics

 

[Spekulatius]

19 hours ago, Parsad said:

 

One of the potential risks to the U.S. could be their insistence on fighting inflation.  If the U.S. continues to raise rates, and other countries are forced to defend their currencies by selling off more and more USD reserves, it means higher and higher rates for U.S. debt issuances as they roll over maturing debt.  Cheers!

Your logic makes no sense. The USD is at record highs, so it's not that foreign entities are selling it. If anything , there seems to be a shortage of USD and the EM's are going to feel the pain.

[Gregmal]

38 minutes ago, changegonnacome said:

 

Existing home owners are sitting pretty. Builders are well capitalized and already cutting back starts big time. And shit, now even the greedy greaseball mortgage companies are TIGHTENING lending standards!(I would have expected the opposite)

 

Seems like that housing supply shortage and affordability issue won’t be getting solved any time soon. If nothing else they just taken (insert however many years this crusade takes) and added all those folks to the demand side as well. 
 

This isn’t even considering the fact prices have softened somewhat but nothing crazy overall. We re still way above 2019 prices pretty much everywhere. Still way below on supply. And contrary to the point people like to make about how much mortgage payments have risen year over year, prices relative to that have held respectably. In other words, what people are willing to pay for a home on a monthly basis is up substantially year over year. So you basically just spring loaded the buyer pool should rates ever come down.  

[changegonnacome]

1 minute ago, Gregmal said:

affordability issue won’t be getting solved any time soon.

 

I know a way affordability get solved......the old fashioned way.

 

Now in an inflationary economy.......nominal prices dont have to fall......they can just stay still and fall in REAL terms.

 

 

[Gregmal]

10 minutes ago, changegonnacome said:

 

I know a way affordability get solved......the old fashioned way.

 

Now in an inflationary economy.......nominal prices dont have to fall......they can just stay still and fall in REAL terms.

 

 

Which old fashioned way? Supply and demand based build to oblivion? Dont think theyre trying that yet. 

[crs223]

1 hour ago, Gregmal said:

We re staring at deflation everywhere and the Fed is mouth breathing about jobs and rent which are lagging indicators. 

 

The Fed’s mandate is to foster maximum employment and stable prices.  The Fed will look at jobs and rent.

[Gregmal]

We must stop inflation! 
 

middle class dude 55 years old

annual salary $130k

Expenses yearly $60k

401k $550k

 

5% inflation 

Costs $3000 in added living expenses

 

solving 5% inflation? 
costs his retirement account $150k 

 

more genius 
 

 

[Parsad]

1 hour ago, Spekulatius said:

Your logic makes no sense. The USD is at record highs, so it's not that foreign entities are selling it. If anything , there seems to be a shortage of USD and the EM's are going to feel the pain.

 

Yeah...ok...!  You may want to read below.

 

https://www.bloomberg.com/news/articles/2022-10-10/the-most-powerful-buyers-in-treasuries-are-all-bailing-at-once

 

Cheers!

[changegonnacome]

16 minutes ago, Gregmal said:

We must stop inflation! 
 

middle class dude 55 years old

annual salary $130k

Expenses yearly $60k

401k $550k

 

5% inflation 

Costs $3000 in added living expenses

 

solving 5% inflation? 
costs his retirement account $150k 

 

more genius 

 

Its not about him Greg of course, but you know that already - its about working poor people.........the bottom 1/3 of your brothers and sisters and fellow countrymen....who got 5% pay increases, in an 8% inflationary economy....who have modests incomes, barely getting by already and well a 3% destruction in their purchasing power for them is ghastly....so yeah....screw your dude aboves 401k....maybe he'll have to buy a smaller boat when he retires.....I'll say a prayer for him

Edited October 11, 2022 by changegonnacome

[patience_and_focus]

3 minutes ago, changegonnacome said:

 

Its not about him Greg of course, but you know that already - its about working poor people.........the bottom 1/3 of your brothers and sisters and fellow countrymen....who got 5% pay increases, in an 8% inflationary economy....who have modests incomes, barely getting by already and well a 3% destruction in their purchasing for them is ghastly....so yeah....screw your dude aboves 401k....maybe he'll have to buy a smaller boat when he retires.....I'll say a prayer for him

It's actually not 1/3 but higher (42%) that don't own stocks. Also out of 58% that do own some amount, the balance is only $25k average. Most of them will own miniscule amount. So it's safe to say more than half the population does not give a shit about stock market and do give a lot of shit about inflation.

 

https://news.gallup.com/poll/266807/percentage-americans-owns-stock.aspx

 

https://www.fool.com/research/how-many-americans-own-stock/

 

[Parsad]

17 minutes ago, Parsad said:

 

Yeah...ok...!  You may want to read below.

 

https://www.bloomberg.com/news/articles/2022-10-10/the-most-powerful-buyers-in-treasuries-are-all-bailing-at-once

 

Cheers!

 

Also take a look at this:

 

https://www.marketwatch.com/story/why-questions-are-swirling-about-who-will-buy-more-than-31-trillion-of-u-s-debt-and-at-what-price-11665507637?siteid=yhoof2

 

Cheers!

[Parsad]

Einhorn Says "Value Investing May Never Come Back!"

 

https://finance.yahoo.com/news/david-einhorn-says-value-investing-192102025.html

 

Usually comes back when a numbnutz says something stupid like that!  Cheers!

[Gregmal]

Wasn’t it their damn stimulus checks that created all the inflation? No it wasn’t QE that had been going on for a decade. That’s only gained steam now because those people are desperate for vindication after a decade but they’re still wrong. It was the stimulus checks. So they wanted more money, they got it, and they still complain? 
 

Its impossible for value investing not to work if you find a business that makes money or trades below private market value and has a share structure or mechanism that allows it to get back to shareholders exists. 

Edited October 11, 2022 by Gregmal

[Parsad]

Cathie Woods, the Vanilla Ice of investing:

 

https://finance.yahoo.com/news/cathie-wood-arkk-verge-taking-151314592.html

 

One-hit wonder!  Cheers!

[Gregmal]

1 minute ago, Parsad said:

Einhorn Says "Value Investing May Never Come Back!"

 

https://finance.yahoo.com/news/david-einhorn-says-value-investing-192102025.html

 

Usually comes back when a numbnutz says something stupid like that!  Cheers!

What else is he gonna say with that performance lol? He had a nice few years with mom and dads money, got some attention to build AUM, and has been a disastrous little napoleon ever since. 

[Spekulatius]

29 minutes ago, Parsad said:

 

Also take a look at this:

 

https://www.marketwatch.com/story/why-questions-are-swirling-about-who-will-buy-more-than-31-trillion-of-u-s-debt-and-at-what-price-11665507637?siteid=yhoof2

 

Cheers!

How do you explain that the USD is so high if they are selling treasuries. Do you think they keep it in cash? They sure aren’t buying stocks or real estate.

[Gregmal]

1 hour ago, changegonnacome said:

 

Its not about him Greg of course, but you know that already - its about working poor people.........the bottom 1/3 of your brothers and sisters and fellow countrymen....who got 5% pay increases, in an 8% inflationary economy....who have modests incomes, barely getting by already and well a 3% destruction in their purchasing power for them is ghastly....so yeah....screw your dude aboves 401k....maybe he'll have to buy a smaller boat when he retires.....I'll say a prayer for him

It seems really kinda fucked up though when you consider that chunks of this guys lifetime paychecks have already been going to these less fortunate via taxation. Further he probably wasn’t eligible for all the stimulus checks that caused the inflation. But nonetheless it’s his cross to carry. It’s always the middle class who gets fucked. Same for my current tenants. Were gonna save to buy a home. COVID hit. Finally recovered and got back to work last year. Now they have the down payments, but the mortgage rates pushed them out and back into renting. 

[DooDiligence]

1 hour ago, changegonnacome said:

 

Its not about him Greg of course, but you know that already - its about working poor people.........the bottom 1/3 of your brothers and sisters and fellow countrymen....who got 5% pay increases, in an 8% inflationary economy....who have modests incomes, barely getting by already and well a 3% destruction in their purchasing power for them is ghastly....so yeah....screw your dude aboves 401k....maybe he'll have to buy a smaller boat when he retires.....I'll say a prayer for him

Thoughts and prayers, right?

 

[changegonnacome]

10 minutes ago, DooDiligence said:

Thoughts and prayers, right?

 

 
Yes….and GoFundme page

[james22]

3 hours ago, Parsad said:

Einhorn Says "Value Investing May Never Come Back!"

 

https://finance.yahoo.com/news/david-einhorn-says-value-investing-192102025.html

 

Usually comes back when a numbnutz says something stupid like that!  Cheers!

 

Seems he's saying there's no better time:

 

“There’s just very few of us left,” he said, adding that most market participants these days are not trained or experienced in value investing, or have shifted to passive or quantitative investing.

 

Fewer players means there’s no one to notice what’s happening to these companies and “nobody knows what anything is worth,” Einhorn said. “So there’s an enormous number of companies that are dramatically mis-valued in ways that we haven’t seen before.”

[Ross812]

3 hours ago, Gregmal said:

It seems really kinda fucked up though when you consider that chunks of this guys lifetime paychecks have already been going to these less fortunate via taxation. Further he probably wasn’t eligible for all the stimulus checks that caused the inflation. But nonetheless it’s his cross to carry. It’s always the middle class who gets fucked. Same for my current tenants. Were gonna save to buy a home. COVID hit. Finally recovered and got back to work last year. Now they have the down payments, but the mortgage rates pushed them out and back into renting. 

 

And he isn't even middle class!

 

The latest census numbers indicate what income ranges constitute the middle class (as of 2020). This will depend on family size. For a single individual, a middle-class income ranges from $30,000 - $90,000 per year. For a couple it starts at $42,430 up to $127,300; for a family of three, $60,000 - $180,000; and four $67,100 - $201,270.

[Gregmal]

3 minutes ago, Ross812 said:

 

And he isn't even middle class!

 

The latest census numbers indicate what income ranges constitute the middle class (as of 2020). This will depend on family size. For a single individual, a middle-class income ranges from $30,000 - $90,000 per year. For a couple it starts at $42,430 up to $127,300; for a family of three, $60,000 - $180,000; and four $67,100 - $201,270.

Yup. So some say fuck him. But the truth is that these people are getting royally fucked and further stuck in the hamster wheel as their HARD EARNED savings, and especially retirement accounts that they rely on the system for, are getting destroying because the academics and hedge funds desperate for short alpha and more interest income are pushing narrative that we re in 1981(12 years into an inflation cycle) when in reality we’ve had 18 month of COVID distortion.
 

This particularly hits close to home for me because my father in law, a great normal middle class guy, is losing sleep because he’s lost a decade of savings this year. He isn’t financially sophisticated and spent 20 years busting his ass. He got lucky when Carl Icahn got his company, Forest Labs sold for a small fortune and that finally propelled him from two decades of paycheck to paycheck into some comfort. And now it’s gone to hell because…”the economy was too good”??? In other words, normal people were doing well and finally had job leverage?

 

Or again, I could revert back to one of my tenants who’s rent is 40% below market because I took care of them since they’re good people and did the right thing during COVID. They finally got back to even late last year, started looking for a home in the spring, and poof, a bs $400k home costs them almost 2x their current rent(on a $;00k home)! I hated “the system” before all this, and my animosity towards it has only amplified.