Posted by DigiNomad on 8th of Feb 2024 at 02:17 pm
Asset prices rising in mass is a "positive response" ?
Hmm, maybe I need to revisit economics and see what I missed.
I mistakenly thought that a bit of distress when experiencing asset
hyperinflation would be a logical human response. Of course, those
managing to benefit in such an environment would gaslight those
that show distress, but at its core I thought it was a fairly
simple concept.
Here was my read on the action for the auction: the market
saw that there was not going to be much resistance to the current
debasement of the dollar via additional debt and deficits, so it
priced it in immediately which resulted in assets prices inflating.
Mechanics: If there is no change in underlying value of assets
(e.g. earnings potential doesn't rise because the market signals it
will take up more US Debt), but the currency the assets in question
is priced is debased by the issuance of debt, then prices will
rise. The intrinsic value of assets stays constant in this
case, but when the purchasing power of the currency dropped with
the auction, it took more of that currency than it did a minute
before to buy that same group of assets.
Posted by DigiNomad on 8th of Feb 2024 at 03:00 pm
You took it to the macro level when you invoked politics in your
response....
Anyway, it usually help to have a little understanding why a
trend is exists in order to determine whether to be tight or loose
with risk parameters. In this case, it's fiscally induced asset
hyperinflation and there's no hint or sign that it will slow
down...so it's probably best to loosen up on risk parameters and
ride the inflationary wave.
Posted by DigiNomad on 8th of Feb 2024 at 04:17 pm
I'm net long by A LOT. Check out some of my recent calls that
would have made you great money. I'd be out of business is my
strategy was not flexible, as you are suggesting (In other words,
you don't know me or my trading style). I just sometimes
like to communicate how I feel about the market from a moral POV.
It's sick what the Gov is doing and we have every right to be and I
think should be angry about it. I think that was the
frustration that came out in the post by been_Trumped that you
jumped on like you seem to do when you sense that a conservative is
voicing an opinion...even if not overtly political.
FWIW, his handle suggests he's against Trump? Been_Trumped
sounds like a bad thing to me. But a lot of people just turn red
and lose their sh*t just seeing the name...no matter the context.
How funny would it be if it was trumped...as in what
happens when someone has a better card. Haha. That makes more
sense.
Posted by mastermind on 8th of Feb 2024 at 04:42 pm
OK, that's funny, because I am a conservative myself, albeit an
anti-Trump conservative because I have my own moral POV, so you
don't really know me either. I am betting Been_Trumped is
pro-trump, but no matter. I shouldn't have mentioned the
administration. I just get annoyed when people continually moan
about a rising market, which is probably a good thing for the
majority of the folks here.
Posted by DigiNomad on 8th of Feb 2024 at 05:02 pm
I'm a capitalist - I like the market to rise because the assets
it represents have increased their intrinsic value. Inflating the
valuations of assets via the debasement of currency is not
something any of us should be cheering on, IMO. Increased intrinsic
values (PE's decreasing vs inflating) is worth celebrating..but
that's not what we're experiencing. If you do the math, I
think you will find it is very very difficult to actually stay
ahead, even if you have a lot of assets...you'd have to have
something like 10X the amount of your annual income needs in liquid
assets and have all of that invested in assets that beat the
average asset inflation in order to get ahead in real terms.
Very few people are in that boat and even fewer can guess
right on the asset mix. That's why millionaires widely report being
worried about finances these days - purchasing power has crashed.
"Bubble" is simply a non technical term for "asset
hyperinflation"
here's the thing - it's the story of the haves' and have nots,
and rich getting richer
not everyone owns stocks - most of the poor or lower middle
close do now own stocks - so when the market is screaming higher
and higher, the wealth effect is mainly benefiting folks who own
stocks - but a couple of my buddies I went to high school with,
they are lower to middle class, do not own stocks, so their wealth
didn't go up with SPX went from 2500 to 5000
That's why when Cramer a while back said - if inflation is
hurting you, just sell some stocks to pay for your bills - shows
you how out of touch he is being in the elite status - not everyone
owns stocks to sell Jim.
Posted by DigiNomad on 8th of Feb 2024 at 05:25 pm
The sneaky thing about how the math works is that it's the
middle class that really get crushed. The poor typically have
earned income that mostly indexes with inflation...and you can't
deflate savings that doesn't exist. The rich have assets far
in excess of 10 times their annual family income needs so they can
mathmatically keep up without much trouble. It's the group that has
assets that are between 1% and say 900% of their annual family
income needs. That group is going to have a hard time keeping up as
their savings is melted away by inflationary deficit spending.
From the Gov's perspective, how do they take more money from
an electorate that won't approve additional taxes? It's
actually very simple. Suspend any limit to Gov credit and
deficit spend on whatever they please...which is exactly what they
are doing. The key is that there is no intention of every
paying it back. There never has been any intention of repaying the
debt and never will be. The deficit spending allows them to
spend without voter approval that would normally be needed to raise
revenue. This debases the currency and triggers asset inflation
(always, not sometimes) and prices get reset to a new level until
more deficit spending comes into to renew the purchasing power
slide.
Eventually, the middle class mostly dissapears and you're
left with the ultra wealthly and the poor.
Posted by mastermind on 8th of Feb 2024 at 05:20 pm
You're absolutely right, and many of the points that Digi makes
I know are true. But as a middle class working guy that is close to
what a lot of people consider retirement age, the best thing that I
can do is try to grow my modest account the best I can to
make the best future I can for myself and my family. I can try to
change policy at the ballot box, but trading is a separate issue
from that. And I do try to put on my bear suit in a falling market,
but I know that I am a lot better at being a bull then a bear. Thus
I am happier during confirmed uptrends.
Posted by been_trumped on 9th of Feb 2024 at 02:13 pm
it's just a joke i had going between a few friends since they
were trump supporters before he even took office. they always would
say it would be great if he became president and i told them, well
you guys are going to be jumping for joy because we're about to be
trumped.
Posted by DigiNomad on 9th of Feb 2024 at 02:17 pm
Ha! I think even Trump was shocked, but sounds like you called
it. Can't confirm, but I might have cried. I definitely have a much
different view on things now though. Night and day.
ha ha politics, again being a business owner you can guess which
way I mostly lean, I never discuss it though because people get so
nutty these days.
I will say that I really hate the environment these days - seems
like in the past say 20 years ago you could have debates with
someone from the opposite political spectrum and either disagree to
agree, or even change one's mind a bit and you could have a
rational discussion - these days, it's like if you hold an opinion
on something and someone holds the opposite political opinion,
instead of simply disagreeing about a fundamental issue - the
person is demonized or called a racist.
Everyone is also overly offended these days about anything -
heck most comedians no longer perform a college campuses because
students get so easily offended and protest. When I was at U of I
in the 90's, I saw Jaw Leno, he performed at one of the big
auditoriums - but no more for the comedians and I can't say
that I blame them.
anyway enough said about that stuff - I do think people with the
social media has been a detriment to society.
Why does it have to
what bs announcement did they just have that created that ...
Posted by mastermind on 8th of Feb 2024 at 01:11 pm
Why does it have to be BS when there is a positive response? I guess no news can be good until there is a change in the administration?
Asset prices rising in mass
Posted by DigiNomad on 8th of Feb 2024 at 02:17 pm
Asset prices rising in mass is a "positive response" ? Hmm, maybe I need to revisit economics and see what I missed. I mistakenly thought that a bit of distress when experiencing asset hyperinflation would be a logical human response. Of course, those managing to benefit in such an environment would gaslight those that show distress, but at its core I thought it was a fairly simple concept.
Here was my read on the action for the auction: the market saw that there was not going to be much resistance to the current debasement of the dollar via additional debt and deficits, so it priced it in immediately which resulted in assets prices inflating. Mechanics: If there is no change in underlying value of assets (e.g. earnings potential doesn't rise because the market signals it will take up more US Debt), but the currency the assets in question is priced is debased by the issuance of debt, then prices will rise. The intrinsic value of assets stays constant in this case, but when the purchasing power of the currency dropped with the auction, it took more of that currency than it did a minute before to buy that same group of assets.
You call this a simple
Posted by mastermind on 8th of Feb 2024 at 02:56 pm
You call this a simple concept? From a trader's perspective the simple concept is "follow the trend".
You took it to the
Posted by DigiNomad on 8th of Feb 2024 at 03:00 pm
You took it to the macro level when you invoked politics in your response....
Anyway, it usually help to have a little understanding why a trend is exists in order to determine whether to be tight or loose with risk parameters. In this case, it's fiscally induced asset hyperinflation and there's no hint or sign that it will slow down...so it's probably best to loosen up on risk parameters and ride the inflationary wave.
My point was what’s good
Posted by mastermind on 8th of Feb 2024 at 04:11 pm
My point was what’s good in investing is making money. You can’t do anything about inflation except for try to grow the value of your account.
I know that with your trading style, you’d like to have a flatline market every day, but that s not reality.
I'm net long by A
Posted by DigiNomad on 8th of Feb 2024 at 04:17 pm
I'm net long by A LOT. Check out some of my recent calls that would have made you great money. I'd be out of business is my strategy was not flexible, as you are suggesting (In other words, you don't know me or my trading style). I just sometimes like to communicate how I feel about the market from a moral POV. It's sick what the Gov is doing and we have every right to be and I think should be angry about it. I think that was the frustration that came out in the post by been_Trumped that you jumped on like you seem to do when you sense that a conservative is voicing an opinion...even if not overtly political.
FWIW, his handle suggests he's against Trump? Been_Trumped sounds like a bad thing to me. But a lot of people just turn red and lose their sh*t just seeing the name...no matter the context. How funny would it be if it was trumped...as in what happens when someone has a better card. Haha. That makes more sense.
OK, that's funny, because I
Posted by mastermind on 8th of Feb 2024 at 04:42 pm
OK, that's funny, because I am a conservative myself, albeit an anti-Trump conservative because I have my own moral POV, so you don't really know me either. I am betting Been_Trumped is pro-trump, but no matter. I shouldn't have mentioned the administration. I just get annoyed when people continually moan about a rising market, which is probably a good thing for the majority of the folks here.
I'm a capitalist - I
Posted by DigiNomad on 8th of Feb 2024 at 05:02 pm
I'm a capitalist - I like the market to rise because the assets it represents have increased their intrinsic value. Inflating the valuations of assets via the debasement of currency is not something any of us should be cheering on, IMO. Increased intrinsic values (PE's decreasing vs inflating) is worth celebrating..but that's not what we're experiencing. If you do the math, I think you will find it is very very difficult to actually stay ahead, even if you have a lot of assets...you'd have to have something like 10X the amount of your annual income needs in liquid assets and have all of that invested in assets that beat the average asset inflation in order to get ahead in real terms. Very few people are in that boat and even fewer can guess right on the asset mix. That's why millionaires widely report being worried about finances these days - purchasing power has crashed.
"Bubble" is simply a non technical term for "asset hyperinflation"
here's the thing - it's
Posted by matt on 8th of Feb 2024 at 05:08 pm
here's the thing - it's the story of the haves' and have nots, and rich getting richer
not everyone owns stocks - most of the poor or lower middle close do now own stocks - so when the market is screaming higher and higher, the wealth effect is mainly benefiting folks who own stocks - but a couple of my buddies I went to high school with, they are lower to middle class, do not own stocks, so their wealth didn't go up with SPX went from 2500 to 5000
That's why when Cramer a while back said - if inflation is hurting you, just sell some stocks to pay for your bills - shows you how out of touch he is being in the elite status - not everyone owns stocks to sell Jim.
The sneaky thing about how
Posted by DigiNomad on 8th of Feb 2024 at 05:25 pm
The sneaky thing about how the math works is that it's the middle class that really get crushed. The poor typically have earned income that mostly indexes with inflation...and you can't deflate savings that doesn't exist. The rich have assets far in excess of 10 times their annual family income needs so they can mathmatically keep up without much trouble. It's the group that has assets that are between 1% and say 900% of their annual family income needs. That group is going to have a hard time keeping up as their savings is melted away by inflationary deficit spending.
From the Gov's perspective, how do they take more money from an electorate that won't approve additional taxes? It's actually very simple. Suspend any limit to Gov credit and deficit spend on whatever they please...which is exactly what they are doing. The key is that there is no intention of every paying it back. There never has been any intention of repaying the debt and never will be. The deficit spending allows them to spend without voter approval that would normally be needed to raise revenue. This debases the currency and triggers asset inflation (always, not sometimes) and prices get reset to a new level until more deficit spending comes into to renew the purchasing power slide.
Eventually, the middle class mostly dissapears and you're left with the ultra wealthly and the poor.
You're absolutely right, and many
Posted by mastermind on 8th of Feb 2024 at 05:20 pm
You're absolutely right, and many of the points that Digi makes I know are true. But as a middle class working guy that is close to what a lot of people consider retirement age, the best thing that I can do is try to grow my modest account the best I can to make the best future I can for myself and my family. I can try to change policy at the ballot box, but trading is a separate issue from that. And I do try to put on my bear suit in a falling market, but I know that I am a lot better at being a bull then a bear. Thus I am happier during confirmed uptrends.
FYI it's good that books
Posted by been_trumped on 9th of Feb 2024 at 01:59 pm
FYI it's good that books weren't offering a prop bet on me being pro-trump because you would have lost that bet.
I had a feeling! Is
Posted by DigiNomad on 9th of Feb 2024 at 02:02 pm
I had a feeling! Is it a card reference?
it's just a joke i
Posted by been_trumped on 9th of Feb 2024 at 02:13 pm
it's just a joke i had going between a few friends since they were trump supporters before he even took office. they always would say it would be great if he became president and i told them, well you guys are going to be jumping for joy because we're about to be trumped.
Ha! I think even Trump
Posted by DigiNomad on 9th of Feb 2024 at 02:17 pm
Ha! I think even Trump was shocked, but sounds like you called it. Can't confirm, but I might have cried. I definitely have a much different view on things now though. Night and day.
to me it was very
Posted by been_trumped on 9th of Feb 2024 at 02:23 pm
to me it was very similar to arnold for governor...most were thinking...nah, no way they elect that guy...and then of course it happens.
My 1st cousin met her
Posted by DigiNomad on 9th of Feb 2024 at 02:25 pm
My 1st cousin met her husband on that campaign. Good times.
they were both on team
Posted by been_trumped on 9th of Feb 2024 at 02:27 pm
they were both on team arnold?
Yep, quite the gamble as
Posted by DigiNomad on 9th of Feb 2024 at 02:31 pm
Yep, quite the gamble as they both left other campaigns that, to me, seemed more viable at the time.
pretty funny
Posted by been_trumped on 9th of Feb 2024 at 02:40 pm
pretty funny
ha ha politics, again being
Posted by matt on 8th of Feb 2024 at 04:54 pm
ha ha politics, again being a business owner you can guess which way I mostly lean, I never discuss it though because people get so nutty these days.
I will say that I really hate the environment these days - seems like in the past say 20 years ago you could have debates with someone from the opposite political spectrum and either disagree to agree, or even change one's mind a bit and you could have a rational discussion - these days, it's like if you hold an opinion on something and someone holds the opposite political opinion, instead of simply disagreeing about a fundamental issue - the person is demonized or called a racist.
Everyone is also overly offended these days about anything - heck most comedians no longer perform a college campuses because students get so easily offended and protest. When I was at U of I in the 90's, I saw Jaw Leno, he performed at one of the big auditoriums - but no more for the comedians and I can't say that I blame them.
anyway enough said about that stuff - I do think people with the social media has been a detriment to society.
wasn't an administrative or political
Posted by been_trumped on 8th of Feb 2024 at 01:15 pm
wasn't an administrative or political post for me. we can change it to what wonderful news just came out to give the spike if you want.