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2023-11: Warosu is now out of extended maintenance.

/biz/ - Business & Finance

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18509374 No.18509374 [Reply] [Original]

What the fuck is happening? The Dow and NASDAQ are set to open at January levels.

We were all ready in a bubble due to low interest rates before this started. Junk bonds were only fetching 4%. There were huge pools of collateralized loan obligations made up of junk rate covenant light leverage loans.Housing prices had outpace growth in income and rents by margins akin to 2005-7. The US government was running a $1T deficit during an expansion, and now it will run a $3.2T deficit.

But stonks are booming. Even if this shit started to get cured tomorrow, we'd have major swaths shut down through mid-May, and a month of reopening. Unemployment is 12.7% in my state, headed to 20% by early May. Our unemployment insurance trust will run out in 6 weeks at this rate. State and local budgets are shot.

But we've reinflated to what was already bubble levels. Why?

All I can think of:
1. The big risk before was corporate debt. The Fed is basically promising to buy into junk debt and ensure no one can fail.

2. Because people know inflation won't kick off right away due to all the unemployment, they aren't afraid (yet) that 4-5% inflation turns basically every bond and fixed income security issued from 2009-2020 into negative real yield toxic shit.

3. As more info comes out, 80% of tax breaks in the stimulus went to people with over $1M incomes. The 10% of households own 88% of all stonks, so they will do the best out of all of this. The rich can pump into the market because they know the government won't let it fail (this also means trillions are being pumped to make sure the top 10% get theirs, even if this means Social Security and Medicare are getting fucked). Fixed income was already shit low and with inflation it will become negative yield. Stonks will at least gain value some day.

4. Institutions are desperately trying pair losses buying back in for a rally they know won't last.

But still, I don't fucking get it.

>> No.18509446
File: 107 KB, 1920x1080, Venezuelan-Stock-Market.png [View same] [iqdb] [saucenao] [google]
18509446

>>18509374
When you value shit in shit you can make up any number you want. Gold and crypto are the only escape.

>> No.18509462

>>18509374
It's almost like this was one big hoax

>> No.18509476

>>18509374
You're over complicating it. People would rather park their money in stocks at this point considering the fed is pointing money and interest rates are 0%. Thus, stocks are inflated

>> No.18509698

The real question is, is the fed going to pump the breaks now that things are starting to get out of hand or risk massive inflation to keep the party going

>> No.18509796

>>18509374
Is this how the roaring 20s started?

>> No.18509817

Look at all this n00b cope text

>> No.18509876

>>18509446
Stupid comparison, inflation for March was the lowest in 5 years. Prices aren't rising. I gassed up for $16 today. A few niche items are inflated, makes, home gym equipment, etc.

>> No.18509907

>>18509476
>People would rather park their money in stocks at this point considering the fed is pointing money and interest rates are 0%


Yup. Stocks are the new bonds and crypto is the new stock market.

>> No.18510064
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18510064

>>18509374
Your main problem is that you assume it's the same now as it has been in the past.

The difference is that in a digital world you CAN have infinite growth. Digital products can be copied forever and most money don't take any physical form but remains a number on the screen.

Economics haven't really worked like they have worked for more than maybe two hundred years at most. Things can change.

>> No.18510160

>>18509374
The recession is inevitable. This was just institutions getting on the right side of the market.

>> No.18510200

>>18510064
Currency, or "numbers on a screen" as you put it are not money. Money is a way to communicate the storage of real value between two parties and creating more of the currency does not generate wealth or value. God why do I have to explain this shit its right out there for you to learn about if you'd take a brief step away from the biz hellhole

>> No.18510225

>>18509374
Stock markets are a Jewish trick, seriously. How old are you that you haven’t realized this until now?

>> No.18510305
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18510305

>>18510200
Irrelevant semantics, I could have called it popcorn and the message is the same regardless.

>> No.18510349

>>18509374
1. The big risk before was corporate debt. The Fed is basically promising to buy into junk debt and ensure no one can fail.

It's mostly this I think. Fed basically guaranteed large businesses they wouldn't be allowed to fail. Meanwhile their medium and small sized competition will all go under

>> No.18510405

>>18510064
This is why bitcoin is and will always be the hardest form of money. First time since the internet was created everything could be copied to infinity, besides bitcoin.

>> No.18510527
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18510527

>>18510405
Pity they refused to scale it and killed off adoption in 2017. Lost all its momentum.

>> No.18510542

>>18509374
/biz/ autistic kid answer
>priced in
boomer answer
>earning fall not that bad. Oil cheap
retarded /pol/ answer
>China hoax over. Trump saved America once again
What’s really happening
>institutions suck in normie dumb money and get out

>> No.18510566

>>18510349
So basically we just wind up further down the road to serfdom through the continuing rise of global corporate fascism? Neat!

>> No.18510613

>>18510542
retarded bear answer:
>/biz/ autistic kid answer
>>priced in
>boomer answer
>>earning fall not that bad. Oil cheap
>retarded /pol/ answer
>>China hoax over. Trump saved America once again
>What’s really happening
>>institutions suck in normie dumb money and get out

>> No.18510683
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18510683

>>18509374
>mfw you missed probably the biggest buying opportunity of your lifetime

>> No.18510700

>>18510683
I'm truly trying to cope

>> No.18510800

>>18509876
>inflation for March was the lowest in 5 years
Why are you people so stupid? What do you think assets prices are doing? You think this is a healthy market? The inflation is in ASSETS not consumer goods, the Fed has been doing this for 12 years and you cunts are so dumb you still haven't figured it out. All the signs are there:
1. Money injections are being targeted at assets
2. Asset prices have inflated at a crazy rate since 2008
3. Diminishing returns of monetary policy with 0% interest not being enough to keep them up
4. QE being reintroduced at a higher level in order to make up for the diminishing returns of their policy

If you don't know what a happening now you're just a permabrainelt. Go look at some charts and watch the line go up and down, stupid.

>> No.18510926

>>18509374
Coronachan was a r*ddit nothingburger. High IQ chad investors loaded up 23 March at the bottom while r*ddit was seething.

>> No.18510945

>>18510926
this fucking nigga GETS it

>> No.18510951

>>18509476
>People would rather park their money in stocks at this point

What money?

>> No.18510972
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18510972

>>18510800
You just sound like a whiny bitch who lost all his money shorting and is now trying to cope. Deal with it fag.

>> No.18510989

>>18510926
I packed my bags with UPRO and hit the fucking road!!!!!!

>> No.18511601

there is only 5% inflation in niche items...are you serious ..there is mass inflation everywhere. The biggest trick the devil pulled is/was deceiving everyone that there is no inflation !!!!!...CPI is a manufactured and fictional..we the working class have seen inflation everywhere in the past 20 years.

>> No.18511637

>>18510683
Sucks because I had just the bought previous dip, and don't make much money.


I should have cashed out my CD, and dumped the money in the market but that kinda defeats the point of me buying the CD.

>> No.18511668

>>18510972
ok boomer

>> No.18511727

"Don't want to get suckered into a FOMO rally but I've started to think the drop was nothing to do with the virus and more a ruse to get banksters to inject another round of liquidity into the post-2008 bubble"...this is the best quote of the day

>> No.18511728

>>18511601
It's the biggest scam. Asset price inflation hurts the young and working class. Boomers plan to dump this and then but bonds at a 4% yield.

>> No.18511737

>>18511601
>there is only 5% inflation in niche items...are you serious ..there is mass inflation everywhere. The biggest trick the devil pulled is/was deceiving everyone that there is no inflation !!!!!...CPI is a manufactured and fictional..we the working class have seen inflation everywhere in the past 20 years.
Either woman or over 55 or both.

>> No.18511762

>>18511727
Because there's a solid chance it's true. The kikes had been waiting to dump their bags, and the virus provided the perfect opportunity to do so

>> No.18511767

>>18509374
We're in for a 2 year bear market.

UND will 200x.

>> No.18511785

I am in my early 40's ...anyone with common sense can tell you that CPI is inflated as it is no reflection on the real world

>> No.18511799

>>18509374
There's twice as much USD now, so USD denominated assets need to inflate. No real growth.

>> No.18511807

>>18509374
I have a (friend) who is absolutely certain of a V shaped recovery, or at least something certain of that. He doesn’t want to listen to me at all regardless of all the logic I through his way. These people really are this retarded, and will get absolutely dunked on.

>> No.18511871

The reason for the global hibernation/lockdowns is to slow down the velocity of money...if this new money reaches main street then we are all in big trouble and will expose this financial system for what is really it....a house of cards