/biz/ - Business & Finance

>>384590
Now is the time to buy revenue streams, and use trailing-stop-loss orders to protect yourself.

Personally, I like having trailing-stop-loss-orders set at around 5%, and have them trigger a limit buy at another 5% down. It's worked well a couple of times; I've sold out as the drop started, and bought back in at a lower price.

>>384590

>Stocks are overvalued
>there won't be another crash

Uhh

>>384603

There's no reason why a stock (or a market) that's 20% overvalued is going to suddenly drop in price until it's 20% undervalued just because you want it to. Usually what happens instead is that it only returns 2-3% for a few years until the it's fairly valued. and then continues from there.

The market has no obligation to have a fire sale once every five years where everything can be picked up for under half of it's long-run value, and people who expect that to happen are deluding themselves.

>>384590

Learn mandarin and get ready for the chinese housing bubble. That shit is going to be big.

>>384590
>Almost every stock (especially good stocks) are overvalued

nope.jpg

>>384683

Doesn't this chart imply that now is a good time to buy? Aren't we about at the end of the business cycle once again, or did the recession have some sort of delaying effect?

>>384783
>Aren't we about at the end of the business cycle once again
Yes, no, maybe? Do you have any objective evidence that the markets are about to turn, or are you pulling this from thin air?

>>384629

this man has it right.

>>384795

Gasoline consumption in the US is down, way down past what mileage gains from Cash For Clunkers or other legal mandates for gas mileage could have made by this point. The QE taper has begun and the Fed said they were going to continue with it, and I surmise that will have a detrimental effect on credit markets. Housing sales and consumer spending are down and it's pretty evident that it's not just "the weather" as top pundits were saying throughout winter and spring.

I dunno, I hope I'm pulling shit out of my ass because this is the first time I'll have cash to invest.

>>384590
>There will never be a crash like 2008-2009 for at least another 20+ years, if at all.

Sure sign that it's about to crash.

>>384590
>There will never be a crash like 2008-2009 for at least another 20+ years, if at all.

Ahahaha. Right, keep dreaming. The bond markets in the US are at a record high even with the bond market being 30% down from last year.
The economic collapse is pretty fucking close.
I wonder why in London they are buying water cannons to be put on the streets this summer..

>>384629
The housing bubble is already pretty inflated.
The right time to get in the market there was mid 2000's.
The government over there is already scrambling to keep the markets somewhat stable.

>>384683
This looks like median is historically around 15. Looks over valued.

>>384590
>>There will never be a crash like 2008-2009 for at least another 20+ years, if at all.
>>The best you can hope for is maybe a 10% or 15% correction, and even that is going to take 3 years.

You mentioned 2008. Take a look what happened then. And in 2000-2001. And in the early 1990s. And in 1987. And 1982-1983. And during the 1930s. And depressions before that.

Absolutely everything points to the economy having more potential downside, not upside.

>>384683
Actually, your chart shows that the S&P 500 is overvalued. The spike on 2010 is the result of earnings crashing along with the housing/credit bubble. Stocks are overpriced by approximately 25% based on historical P/E ratios. Based on valuations alone, the stock market isn't yet in bubble territory but these aren't free markets.

Get the Federal Reserve and U.S. government out of the Treasury, MBS, and mortgage markets and you'll see some very serious fireworks in the equity markets. As it is right now, markets *will* correct; it's just that no one knows when or by exactly how much.

Beyond that, the U.S. markets will go into the shitter if China experiences some sort of crash.

>>384590
The second interest rates go above 0% you will see stocks tumble 75%. You are being fleeced right now and have no clue.

I may be able to make it in here later, but stocks I own that are fair value/undervalued:
F(ord)
BAC(Bank of America)
SIRI(SiriusXM)
INTC(Intel)

I think MSFT is fair valued after the run up, but I'm bullish on Surface 3.

>>384824
>The bond markets in the US are at a record high even with the bond market being 30% down from last year
>>384879
>Absolutely everything points to the economy having more potential downside, not upside.
>>384906
>these aren't free markets
>>384916
>The second interest rates go above 0% you will see stocks tumble 75%

Christ I forgot how autistic /biz/ is whenever somebody asks when the next correction will be.

Pic related. Expect a real return of around 5-6% over the next decade. Mild overvaluation doesn't mean everything's going to catch on fire and explode in the next six months.

>you will never have enough money to make a downpayment in 2010

>>384906
>As it is right now, markets *will* correct; it's just that no one knows when or by exactly how much.
This is just the worst form of sophistry, You know what else is true: markets *will* rise; it's just that no one knows when or by exactly how much. Also, markets *will* drop; it's just that no one knows when or by exactly how much. Then, markets *will* rebound; it's just that no one knows when or by exactly how much.

Keep pretending you have a clue what's going to happen or what will optimize your position. Meanwhile, I'll continue to play the long game -- i.e., the only consistently winning bet in the markets.

>>384994
This.
And even if there was a crash, the real economy isn't going anywhere.

>>384926
>owning bank stocks
They're getting fucked in the ass by lawsuit after lawsuit. Too much bullshit to deal with.

>>384994
What are your solid long picks? My main hoe is GILD.

>>384994
iHaz millionz please teach me your secrets. Let me suckle on your breasts of knowledge.

>>384683
Yup.png

>>384590
What are you trying to say here OP? Just because most stocks are currently overvalued doesn't mean you still can't make money. Look into some event-driven strategies.

I can't wait for the next correction, and who cares if it takes another 3 years before that happens (which would be unlikely since we're already almost 6 years into a bull market). Besides, if you don't like how things are priced right now no one's forcing you to buy.

>>384994

Playing the long game works but my feeling is that investing in a manipulated environment is dangerous. QE has been all about lifting asset prices, which it has done fantastically. However, this is a false gain. Demand has been brought forward and we'll never know when gains will be given back. Returns in the run-up to the housing bubble certainly were given back and all it took was a few trillion dollars and the credibility of the U.S. to restore house prices in only some parts of the U.S. and employment still has not recovered.

I'm not going to challenge you because, to date, you've certainly done well enough to say what you say. However, the whole idea of saying that the stock market is normal and that the past few decades of gain will continue is also a logical fallacy, in my opinion.

I agree with you that trading is historically a loser. However, the 2000 and 2008 busts and the subsequent false recoveries, in my opinion, have turned buy and hold on its head. There is something terribly wrong with the U.S. economy and most assets are overpriced by any historical measure.

>>384994
Whoops. I should add that correct is not some 10% drawdown but something really nasty. Your chart of your net worth didn't go back to 2007 but from January 2008 to March 2009, there was a 50% drop in the index.

>>385018
Vanguard, earning a high wage(I think he's said ~400k corporate law or someshit).

>>385018
>>385247
Pic very related.

>>385018
>>385247
He doesn't have any secrets or knowledge. He simply added his high income to passive index funds (which takes no skill, and he has admitted numerous times that he knows nothing about active investing) at the beginning of one of the greatest bull markets ever, thus giving a quasi-illusion that he's made a lot of money from investing.

What you have to understand is that crane operators, government pensions, truck drivers, insurance companies, miners, morons, etc. have all done the exact same thing he has but the individual people doing it do not have $500,000 a year incomes, so their overall end capital is far smaller, thus looking less impressive.

For example, a person who puts in $50,000 compounded at 20% annually at the beginning of six years ends up with $149,299.

But a person who puts in $500,000 compounded at 20% annually at the beginning of six years ends up with $1,492,992.

The second one, to the typical person, looks far more impressive.

Pic related, I didn't even know it was possible for even the most novice to be this retarded.

US Q1 GDP estimate 1 year ago: 2.9%
Revised to 0.1%
Then revised to -1.0%
Recent estimates are at -1.9%

What makes you think Q2 will be much better?

>muh rebound
>muh weather
>muh optimism

If you think the market isn't in a giant bubble right now look at the P/E of $RUT.

>>385264
iHaz actually said all that shit? LOL

I just lost a lot of respect for him. Yeah, I guess his knowledge is pretty much limited to "muh index fund diversification".

>>385264
I'll agree that some of the shit he says there is immature/wrong, but that's the thing. Almost everyone here WOULD be better off using index funds than attempting to invest themselves.

And he's proven it by being so immature to boot. If a corporate lawyer earning several hundred thousand a year and with assets of 9 million dollars shouldn't be stock picking(with the majority of his money, I think he has ~1 mil of non-index assets), that advice applies to almost everyone here as well.

>>385415
I like you

>>385415
that's not saying much because we have literally the most retarded people on this board trying to "turn their life around"

>>385264
who am i supposed to be rooting for?

>>385523
The person without the "iHaz" trip.

>>385233
>QE has been all about lifting asset prices
No, QE has been about encouraging lending and bolstering the liquidity of the financial sector. The rise in equity prices is simply a side-effect of the drop in interest rates. The Fed doesn't give a damn about the level of the stock market, and they don't enact policies designed around it? Why? Because the markets generate wealth, but not economic activity in any appreciable degree.

Furthermore, QE has been on the phaseout since last year. The markets don't really seem to care. People are still buying equities for all the same reasons they did before QE ever existed. If anything, its taken this long for most people to get over the fear generated by the 2008 crash. There are still billions on the sidelines ready to come into the market. Research the mutual fund inflow reports -- people want to own this market, today.

>>385237
With all due respect, this kind of hysteria just isn't productive. I don't know when the markets are next going to drop, and neither do you. I do know that your fear of something "nasty" is just an emotional response.

Bottom line: S&P PEs are only at 19, and the yield curve is miles away from being inverted. There's just no rational basis to play the doomsayer here.

>>385408
>iHaz actually said all that shit?
What I said in that thread can be boiled down to three points:
1. Berkshire Hathaway historically underperforms in bull markets. TRUE.
2. Berkshire Hathaway's performance is affected by the salaries of its team, in the same way that a mutual fun is affected by the fees of its managers. TRUE.
3. Stock pickers underperform peer benchmark indices in 80% of cases, according to peer review studies. TRUE.

>As for losing your respect, I'm really busted up about that. Oh dear ... some retarded impoverished loser with poor reading skills doesn't look up to me! Does anyone have a tissue?

>>385613

>The Fed doesn't give a damn about the level of the stock market

That's why they panicked and cut rates 75 basis points in Jan '08 on a steep market decline.

>>385613

>There are still billions on the sidelines ready to come into the market

And no such thing as "cash on the sidelines." Every buyer requires a seller.

>>385629
Federal Open Market Committee
Press Release Date: January 22, 2008

"The Committee took this action in view of a weakening of the economic outlook and increasing downside risks to growth. While strains in short-term funding markets have eased somewhat, broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households. Moreover, incoming information indicates a deepening of the housing contraction as well as some softening in labor markets."

It's a natural human reaction to correlate the Fed's lowering of interest rates to the then-current markets levels, but these things aren't that simple. There was obviously a LOT going on in 2008, aside from raw movements in the stock market. Indeed, wouldn't it be more accurate to say the financial crisis drove the markets, not the other way around?

In other words, the markets are a symptom of illness, an indicator that something is wrong. The Fed generally tries address the root cause of the illness, not the side-effect.

>>385634
I don't think you understand what that expression means.

>>385647

Hmmmm...

http://en.wikipedia.org/wiki/2008_Soci%C3%A9t%C3%A9_G%C3%A9n%C3%A9rale_trading_loss

The bank then closed out these positions over three days of trading beginning >>JANUARY 21, 2008,<< a period in which the market was experiencing a large drop in equity indices, and losses attributed are estimated at €4.9 billion.

http://money.cnn.com/2008/01/22/news/economy/fed_rates/

Citing weakening economic outlook, Federal Reserve makes biggest cut in nearly 24 years - three quarters of a point.

>>January 22 2008<<
The Federal Reserve slashed two key interest rates by three-quarters of a percentage point Tuesday following an >>UNSCHEDULED MEETING<<, citing continued concerns about a weakening economy and >>TURMOIL<< in the financial markets.

>I don't think you understand what that expression means.

It means cash on the sidelines. Which doesn't exists because every buyer requires a seller.

>>384590
HAHAHAJA, ahah

Gawd, I love the newbie shit on this board.

>>385652
I'm not going to engage in a pointless chicken-or-egg debate over this point. I stand by my view that the problems in the financial and banking sector resulted in a drop in the stock markets (not the other way around) and that the Fed responded to those systemic institutional issues, not to market levels. You are welcome to your own opinion.

>You keep talking about willing buyers and willing sellers, while I'm talking about people who have heretofore elected to be neither. I'm not sure you're putting much thought into your posts at all, which is frustrating. Good day.

>>385668

>You keep talking about willing buyers and willing sellers, while I'm talking about people who have heretofore elected to be neither. I'm not sure you're putting much thought into your posts at all, which is frustrating. Good day.

Not the first time I've been called an idiot by people who don't know what they are talking about.

>>385673

To further my point, think about what happens when the price of a financial instrument opens higher or lower from the prior days close(ie gaps up or down).

>>385673
By money on the sidelines I think he means people that have pulled out large portions of their investments and have the cash sitting in their broker accounts collecting dust.

Other than that small distraction, you're right on all accounts.

Also
>Arguing with gamma

Protip, nobody has ever won an argument against Gamma in the entire year I've known him.

>>385621
>1. Berkshire Hathaway historically underperforms in bull markets. TRUE.
Source? Also, even if true, so what? Historically, the market has averaged annually anywhere from 8-10% while Buffett averaged 29% in his early days for 13 years and 21% up until today. He would make a much higher return percentage if he weren't handicapped by having too much money to invest in smaller, better stocks. Do you even know the effect of compounding?
$10,000 at 10% (best case) for 40 years ends up being $452,592. While $10,000 at 21% for, say, 40 years ends up being $20,484,002.

>2. Berkshire Hathaway's performance is affected by the salaries of its team, in the same way that a mutual fun is affected by the fees of its managers. TRUE.
False. Berkshire Hathaway is a holding company, you moron. As in, you can invest in it like you can invest in any other stock. Warren only has, if I recall correctly, 14 people working in his office and most are secretaries. All of them are not paid excessively, and he limits his personal salary to $100,000. (Although, none of this matter because it has nothing to do with Berkshire's stock.) It's not a hedge fund, dumb-dumb. You don't pay "fees." I thought it was impossible to not know this, especially after how stupid you were here: >>385264

>3. Stock pickers underperform peer benchmark indices in 80% of cases, according to peer review studies. TRUE.
Lel on the top shelf. Those "stock pickers" are not Warren Buffett, David Tepper, Peter Lynch, Benjamin Graham, etc. Pic related.

>>385687

I think he means investors want a higher allocation to equities which indeed does drive prices higher. But reading >>385680 you see that that can happen WITHOUT a trade occurring (ie no cash exchanging hands). In other words "cash on the sidelines" has nothing to do with asset prices.

>>385695
I just read what he said in full context. Yes, cash on the sidelines has nothing to do with asset prices because its outside of the market system.

I don't understand why he's even bringing it up.

>>385691
Yes. Warren Buffet, Peter Lynch, Benjamin Graham are exceptions, but they all used beat the market a long time ago. I highly doubt they would be able to do it again nowadays. The market as a whole has changed a lot. It's much harder to profit over market innefficiencies today than as it were before. Usually, all the information available publicly is already accounted for on the prices of stocks. The only useful information is the private one, but, again, today is much harder to insider trade.

>>385721
>Yes. Warren Buffet, Peter Lynch, Benjamin Graham are exceptions, but they all used beat the market a long time ago. I highly doubt they would be able to do it again nowadays.
Buffett (with numerous others who have been around for over 20 years) still do it today.

>>385721
>I highly doubt they would be able to do it again nowadays.
Why exactly? Most of them (still alive) still do and have been doing so for decades.

>The market as a whole has changed a lot. It's much harder to profit over market innefficiencies today than as it were before.
I'm not sure what you're getting at but the vast majority of successful investors are investors for the long term, not traders for the short term. What you're saying might apply to traders, but not exactly to long term investors. The philosophy of Buffett can be boiled down to finding a great business with good future prospects at a discount to intrinsic value, and buying and holding that business for 10, 20, 30, 40, 50 years, or a lifetime. The short term doesn't mean much, if anything at all, when you're investing for the long term.

>>385691
Oh God, its you. Mister Slurp-at-the-teat of well-known stock pickers. Time for some of your well-worn cut-and-paste glory.

>>385695
>I think he means investors want a higher allocation to equities
No, I'm talking about pent up demand and sustained demand for the short to medium term. The clue was me talking about fund inflows.

And what happens to prices (market levels) when we turn up the demand dial?

>>385758

>The clue was me talking about fund inflows.

Every dollar going into the market also leaves the market. How can you be this stupid?

>>385733
Buffet is hardly doing it nowadays.

Because, if I'm not wrong (I don't know about Peter Lynch enough, but I assume he is a value investor), their investment strategy is based on market inneficiency, based on finding "cheap stocks", basically. The faster way information flows, better insider trading regulations and market regulators, the globalization itself, which make global markets much more interconnected than before, etc, makes markets almost perfectly efficient.

I'm not saying long term investors can't outperform the market, just that it's much harder to outperform it for more then 10% on the long run now.

>>385764

>, just that it's much harder to outperform it for more then 10% on the long run now.

I wouldn't say that. You have to remember about the size of Buffett's operation then vs. now. If you outperform the market long enough, you will become so large as to become the market and you can't outperform yourself.

>>385767

Also a strategy that works for $1,000 likely won't work for $100,000,000. Anyone can easily buy an ATM weekly vertical with $1,000 and turn it into $2,000 by the end of the week. Can you do that with $100,000,000 or $1,000,000,000? No.

>>385746
I think the funniest thing about you is that you can never respond to points raised against you when you're pointed out to be a retard. You don't even know that Berkshire is a holding company and not a hedge fund. Sometimes it feels like throwing rocks at someone with Down's.

>>385764
>Buffet is hardly doing it nowadays.
That's only because he has so much money that he can't invest it in smaller stocks that move (and even if he could, it wouldn't register as much of a return on all of his capital, even if it multiplied). He's still raking in 20%+ a year most recent years anyway.

>their investment strategy is based on market inneficiency, based on finding "cheap stocks", basically.
You're thinking more of the likes of Ben Graham and Walter Schloss, those who simply buy cheap stocks just for being cheap. Most good investors want more than just cheap stocks, the stock has to be worth something for the long term, and has to be undervalued when bought. I think you're thinking along the lines of the "efficient market theory", which has been torn to shreds countless times.

>I'm not saying long term investors can't outperform the market, just that it's much harder to outperform it for more then 10% on the long run now.
Maybe, it certainly depends on the investor and the particular investment methods, but numerous investors that have a 20+ year history of outperforming the market are still doing it today.

>>385762
>How can you be this stupid?
Net inflows, you retard. If you're going to resort to ad hominums then at least be sure you're right before posting. You're embarrassing yourself.

>>385787
Make a cogent point and I will respond. The distinction between a holding company and a hedge fund is irrelevant because we're talking about performance as affected by investment expenses.

Here's a point for you, faggot. Prove to me that Berkshire Hathaway doesn't have salaries that affect the value of the stock. If you can't, then leave /biz/ forever.

>buh bye.

>>385799

>Net inflows, you retard. If you're going to resort to ad hominums then at least be sure you're right before posting. You're embarrassing yourself.

Net inflows to one fund is an outflow for another unless the fund just sits on the cash.

Please grow a brain.

>>385804
>Here's a point for you, faggot. Prove to me that Berkshire Hathaway doesn't have salaries that affect the value of the stock. If you can't, then leave /biz/ forever.
Sorry, the burden is on you to prove that they do. You're a "lawyer" or at least a pretend one, you should know that.

I wouldn't doubt that Berkshire Hathaway has to pay their workers. What are you, even more fucking retarded that you are? Can you name a company in the US that has workers who work for free? The questions are (1) whether them paying their workers somehow has a negative effect on Berkshire Hathaway's stock or performance (which it doesn't), (2) whether Berkshire Hathaway's stock owners are paying Berkshire Hathaway office workers directly in the form of "fees" like a hedge fund (which they aren't), (3) whether even if you were absolutely right on every issue, it would have some kind of effect on Berkshire's net stock performance (which it wouldn't), and (4) even if you were absolutely right on every issue and it did have some kind of hedge fund fee structure, whether it would be worth it (which it would).

I often feel like you're a troll because there's no way someone (especially a "corporate lawyer") could be as stupid as you. Why don't you post your Esq. name and state so we can look at how many of your clients have killed themselves after you lost their case for them. You come across as someone who's been long divorced and who has yellow spots from accumulated tears on your $400 pillow. Go ahead and say bye again so I can laugh at the thought of you refreshing the page and replying yet again.

>>385799

And again read this,
>>385680
>>385680
>>385680
>>385680

something might click in that empty noggin of yours.

>>385819
>>385819

He's also completely ignoring the fact the Berkshire as access to dirt cheap funding via their massive insurance float. Meaning comparing Berkshire to a hedge or mutual fund isn't an apples to apples comparison.

>>385818
>Net inflows to one fund is an outflow for another unless the fund just sits on the cash.
Are you honestly this stupid are you do not you not understand the concept of personal income. Let me explain it for you in terms you might understand:

1. Person gets job.
2. Job pays wages/salary.
3. Person invests income.

New dollars come into the markets all the time, and no they don't always result in outflow.

Riddle me this, Joker. If every inflow was matched by an equal outflow, then wouldn't the world market capitalization would always remain level. Guess what? It doesn't.

>mike drop

>>385825
This too, aslo. He should invest in a bigger small intestine so his head has more room.

>>385819
>Asks him to prove a point in his own argument
>Hurr, durr "yer a leryer"
>Spaghetti errywhere
>I realize I am responding to a literal mentally handicapped person
I got nothing but pity for you, son. Life must be hard for folks like you.

>>384590
>S&P at all time high
>"there will not be a massive correction in the near future"

oh /biz/ when did you start listening to msnbc?

>>385825
This too, also. He should invest in a bigger small intestine so his head has more room.

>>385825
That BRK has a competitive advantage over other investment firms is irrelevant to the point. (Not that its even pertinent under current market conditions, where there's a surplus of capital.) Are you just throwing out random facts and buzzwords now?

>Honest question: have you been drinking? The quality of your posts has gotten markedly worse by the hour.

>>385831
10/10 troll.

>>385830
>>385833
Can't even post correctly. This is just sad. There's no honor in humiliating you further.

>>385826

>New dollars come into the markets all the time, and no they don't always result in outflow.

Hmmmmm...

So when I buy a stock the money I buy it with magically disappears into some black hole? And the stock itself is created with magic fairy dust? Ok. You convinced me.

>>Riddle me this, Joker. If every inflow was matched by an equal outflow, then wouldn't the world market capitalization would always remain level. Guess what? It doesn't.

Read this
>>385680

^^^^This answers that question. See I'm so far ahead of you right now I answered your question 4 hours before you asked it.

But to put it in laymans terms so your dumbass can understand it. The market cap of the market doesn't represent the amount of money put into it. Just the amount of money that the market can be exchanged for at this very moment. I can buy a stock for $1 and immediately offer it for sale at $4. The market just went up 4x in value without any money exchanging hands. Voila.

>>385838
>Doesn't even know how to use green text either.
This must somehow affect his investment performance in some way that I don't know that I can't render an argument for that wouldn't matter anyway that doesn't exist.

>>385843
>I can buy a stock for $1 and immediately offer it for sale at $4
Only if there's excess demand.

>excess demand = money on the sidelines
>boom

>>385846

>Only if there's excess demand.

Actually, nothing stops me from quoting it at $4.

>>385846

And keep on ignoring more than half of each of my posts while I destroy yours in their entirety.

>>385848
You quoting it at $4 doesn't change the market capitalization unless you're the lowest offer, which would only be true if there was excess demand. Otherwise the ask would be lower. You can't change the spread by yourself, kiddo.

>you dun goofed

>>385852

>You quoting it at $4 doesn't change the market capitalization unless you're the lowest offer, which would only be true if there was excess demand. Otherwise the ask would be lower. You can't change the spread by yourself, kiddo.

What if every seller colluded to quote at $4? The market is two-sided. Bids and offers are independent so demand can't force down an offer.

>>385852

You are also consistently ignoring the aggregate for the individual which clouds your thinking. You gotta stop the navel gazing to understand this stuff.

>>385850
Sorry chief, you over-extended with your argument and went right over the edge. You're not going to distract me from your "every dollar in is a dollar out" argument by throwing a bunch of shit at the wall to see if I bite. You backed yourself in a corner; now sit there, son.

>>385857
>What if every seller colluded to quote at $4?
Efficient market theory. Adam Smith, et al. Enlightened self-interest.
>Please step up your game or stop. This is so easy its getting boring.

>>385862
See above. More spaghetti on the walls. It's not "last post wins" kiddo.

>>385865

>Sorry chief, you over-extended with your argument and went right over the edge. You're not going to distract me from your "every dollar in is a dollar out" argument by throwing a bunch of shit at the wall to see if I bite. You backed yourself in a corner; now sit there, son.

You didn't answer my question. What black hole does money go into when you buy a stock?

What magical white hole does the money shoot out from when an investor sell a stock?

>Efficient market theory. Adam Smith, et al. Enlightened self-interest.

I just described a cartel. That's enlightened self-interest.

http://en.wikipedia.org/wiki/Cartel

>See above. More spaghetti on the walls. It's not "last post wins" kiddo.

It was just an observation I forgot to type into my other post. If you want to continue being wrong do so. Again answer the two questions I wrote above. Then you will realize you are wrong about everything and apologize. ( I can dream.)

>>385873

A quote from adam smith

"People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices. It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice.”

—Adam Smith, The Wealth of Nations, 1776

And for FURTHER evidence I'm right.

Why do clearing houses exists?

For what purpose does the Options Clearing Corporation and The Depository Trust & Clearing Corporation exist?

Really I never had to argue with you. I just had to to point to the fact that clearing houses need to exist. With that I'm done.

>>385873
Don't expect him to answer your questions. When he gets proven wrong and it's pointed out to him why he's a retard, he won't refute any of it, he'll simply call you a name or make some kind of irrelevant, intentionally vague post. Oh, wait... >>385877

>>385873
>>385877
>>385887
>>385889
>pic related
>lick your wounds and try again another day, son
>>385890
>samefaggery suspected
>would explain a lot

>>385897
>Points out posts with questions he refused to answer, making himself look more like a tool.
>Accuses someone of samefagging on a board with IDs.
The sad thing is you're like 40.

>>385900
Answer my question >>385804 or leave /biz/.
>buh bye

>>385903
Answer my questions:
>>385691
(You dodged those here: >>385746)

>>385819
(You dodged those here: >>385831)

>YFW you realize God exists.

>>385261
i get like 3 giggles a year from this site

And ihaz continues to display his inability to grasp that someone knows more than he does.

>>385938
>And ihaz continues to display his inability to grasp that someone knows more than he does.
I've yet to meet someone who does. I look forward to the day, nonetheless. I'm sure it would be a rewarding experience.

>>385938

He suffers from the dunning-kruger effect.

>>385909
>>385943
Still no response. Install Gentoo.

>>384590
>missed the solar undervaluation
>missed the mreit undervaluation
you had two opportunities to make mad cash THIS YEAR and probably didn't even look outside the s&p500 daily rate

maybe you should just find a nice mutual fund with a fancy name to put your $500/mo in?

>>385819
>>385787
>>385948

hahaha I fucking love this guy. iHaz getting BTFO. he really has no shame

what do you do for a living, brah?

>>385978
SHIIIIT I wish I got in on KWT last year.
Also REIT ETFs.
Damn.

>>384590
You saw the 3D printing bubble.
You also saw TSLA before the run up.

>never going to miss out on cult stocks again
>retail investor sentiment is as easy to recognize as the weather

>>385613
iHaz Millionz:

I respect you tremendously because you are very clueful and you're trying to help people here. I am not looking to get into an argument with you (I'd probably lose anyway because I'm not a lawyer.) I am here to present a different point of view about the markets. In my opinion, markets are terribly broken and many people don't realize it.

I don't know how much you study markets and market history but doesn't it seem strange that we've had two spectacular busts in 8 years' time (2000 and 2008)? In modern economic history, I don't think you'll be able to find any major economy, nevermind the economy of the issuer of the reserve currency, to have such dramatic volatility in such a short period of time.

QE has been all about raising asset prices and Ben Bernanke has most certainly said so in a typically oblique Federal Reserve way. One of the ideas behind raising asset prices has been to create a wealth effect, which will encourage spending. Bernanke specifically uses the phrase "wealth effect" in his speeches on quantitative easing.

As for being hysterical, did you know that we were going to have a bust pre-2000 and pre-2008? I did. I didn't know the timing but I most certainly knew there were going to be busts and I knew the 2008 crash was going to destroy the U.S. banking system. As pessimistic as I was, I was not pessimistic enough as I did not imagine that it would cause *every asset on the planet*, save USD and JPY and their associated government-issued bonds, to go down.

By all means, don't just believe what I write because I'm just some anonymous guy who could be an utter idiot living in a cardboard box. Take a
read of what Grantham and Hussman are saying. These guys, especially Grantham, are very highly respected and Grantham nailed the past two bubbles.

>>385621
>Oh dear ... some retarded impoverished loser with poor reading skills doesn't look up to me! Does anyone have a tissue?
>Tries to save face by acting like a 15 year old boy who's been called out on his shit
>Fails miserably
Is there anything you *aren't* bad at?

>>385647
Ummm.... The Federal Reserve doesn't always tell the truth and the Federal Reserve is also wrong at times.

"Subprime is contained." Is Bernanke an idiot or was he lying?

Bubbles cannot be seen and thus prevented. All we can do is clean up the mess after a bubble pops. [I don't have the exact quote.] Is Greenspan an idiot or is he lying? Hint: He's lying and the records prove it.

Liquidity in the markets was already achieved with the alphabet soup of programs the Fed unleashed in the wake of the financial crisis: TALF, TARP, MMLFM (or whatever it was called), ZIRP, interest on excess reserves, etc. Does anyone really believe that most recent round of QE was to provide additional, *needed* liquidity? That prior to the extra $1tln the Federal Reserve expanded its balance sheet by, that bonds couldn't catch a bid?

>>385929
wat

>tfw you were only 15 during the '09 crash and didnt buy any shit
>tfw all that missed oppertunity
>tfw nothing that golden will come for many years
Tfw getting educated to become a wage slave instead of making investmentbux

>>384994
Hope you mean short or you will be like one of the japan investors still waiting for the market to recover 30 years later

>>386118
i enjoyed your picture to the letter

>>386121
Ah. Not mine, it's pasta from a few months ago.

I don't really remember the context but I'm pretty sure it was specifically directed towards the tripfag shitting up this thread, assuming he's the Vanguard guy who thinks buying in at the bottom of a crash somehow makes his returns impressive.

>>386120
Japan will never recover. Their demographics are fucked.

>>384873

Keep in mind that graphic is the Shiller P/E, which compares present prices to the trailing 10-year average earnings. It is artificially inflated right now, because we are exiting a multi-year (2008-2010) where earnings were artificially depressed. Earnings dropped 88% in 2008 from 2007!

Stocks can continue to go up and that value will still trend down over time as the poor earning years from the recession begin to get eliminated. It might have been useful in suggesting stocks were overpriced during the tech bubble of 1999, because the 90s were a relatively benign decade for the U.S. economy. But it would seem that metric isn't as useful in gauging the health of the present market, and better metrics would be trailing twelve months and forward-looking PEs.

>>386106
Didn't even notice that snide green text that iHaz wrote at the end.

He's incredibly immature for a 40-something.

By the way iHaz, my parents are many times richer than you, and I'll probably be wealthier than you within a decade. I don't think anyone on this board gives a fuck about who you think is a "loser" or "cool".

I have excellent reading skills and have determined that much of what you say is just flat out wrong and should be ignored.

>>386122
o
i just really like your picture
i had a good laugh

haha

Value oriented growth strategy master race checking in. Who says you can't have your cake and eat it too?

>>386125
>He's incredibly immature for a 40-something.
After reading through this thread I'm pretty sure he's just a troll. I don't think he's 40, I don't think he's a lawyer, I don't think he has any money.

I think he's just a NEET who figured out how to edit HTML for Vanguard statements.
>Needing to validate yourself to the board that is basically /r9k/-watches-CNBC
He dun goofed.

>>386128
post your favorite investments for growth

>>386123
The demographics really don't matter; their job market does not need a growing population anymore thanks to technology. US is in the same boat, arguably worse since we don't have their demographic "problem" and will thus have more people for fewer jobs going forward.

>>386131
holdings or what I look for?

>>386137
Old people retire and collect their retirement funds and pensions. And there is a lot of them.

>>386139
both
im new to this , recently read graham and some little things by buffett. i like their strategy thus far

so any current investments you like, or any past successes and what made you buy.

also any failures youve made in the past. why did they fail on you what did you learn from them

post anything really
i like to read

>>386103
>As for being hysterical, did you know that we were going to have a bust pre-2000 and pre-2008? I did
Yeah, you lost me there friend. Anyone who claims to know the future direction of the markets has no credibility with me. I believe that you THINK you see patterns -- looking back with the benefit of hindsight -- but that's just good ol' confirmation bias rearing its ugly head.

Yes, I understand that rising market levels might have a wealth effect, and that Bernanke mentioned it as early as 2010. That doesn't make it true, nor does it indicate that the main purpose of QE is to buoy asset prices, as you suggest. I posit that liquidity in (and frankly survivability of) the financial sector was a far more pressing concern for the Fed in 2009-2010. But really you're missing the point altogether. The only reason this is relevant to the present discussion is the (incorrect) allegation that tapering QE will lead to a crash. While predicted by some in 2013 (and by a few morons in this thread) the facts just haven't borne it out.

In any event, its obvious you have a lot of fear about the current markets. You're seemingly looking for excuses to justify your desire to avoid the risk you perceive in equities. Its not my place to assuage your fears, and I don't intend to try. If you won't believe the research that says waiting to "buy the dip" underperforms in the long run, then you're not likely to believe me. Your loss.

Good luck out there.

>>386139
Both nigga

>>386170

>Anyone who claims to know the future direction of the markets has no credibility with me

>If you won't believe the research that says waiting to "buy the dip" underperforms in the long run, then you're not likely to believe me.


hehe

>>386184
Kind of obligatory:
https://www.youtube.com/watch?v=jllJ-HeErjU

>>386184
Obviously you don't understand the difference between making near-term market predictions versus peer-reviewed comparative analysis of trading strategies. That's ok. You barely know how to turn your proxies on and off.

>>386188

Ok buddy. Go back to being a self-contradictory moron.

>>386188
>That's ok. You barely know how to turn your proxies on and off.
>Refuses to answer questions
>B-but the k-kids on 4-4chan are s-s-samefagging!
Die.

>>386170

I did not know the future but *a lot* of people knew it was a bubble in 1998-2000. Likewise, the real estate bubble was obvious and if you understand how the mortgage system and collateralization system worked, it was also obvious that it was a bubble. I did not claim to know the immediate direction of the dot-com and housing bubbles but I *knew* and plenty of other professional *knew* that they would bust and crash very, very hard.

No one who knows anything about markets thought that the NASDAQ would only correct 20% or so even when it was only 3,000 on its way to over 5,000. Likewise, it was obvious that once the NINJA loans became popular that housing would collapse hard.

In a way, your being sceptical is good for you: protects you from buying snake oil stories. However, you seem to refuse to see the reality: there are certain events that are very easy to see and they are not one-day things. They are relatively long, multi-year processes than can be aren't just stabs in the dark. We're not talking about day trading here.

I'm fearful, you're absolutely right. I've seen behind the curtain and it's not pretty. However, I'm not 100% out of equities. I have about 20% in equities, 25% cash, and a substantial dollop of PE.

All in good time, we'll see if my caution is warranted. I fully admit, last year was torturous but so was 1999.

>>386184
I'm assuming you're not waiting to buy the dip but you're waiting to buy the crash?

>>386198
>However, you seem to refuse to see the reality: there are certain events that are very easy to see and they are not one-day things.
Are there are tangible warning signs out there? I don't know. I do know there are a lot of people who CLAIM to know the warning signs than can possibly be true. None of these people seem to have terrific long-term trading records either, which causes some skepticism on my part.

Personally, I keep an eye on market P/E levels and on the yields curve. Not because I'm trying to predict the future, but because there is some analysis out there that correlates these indicators to market declines. But even if I buy into this line of thinking, (a) market P/Es are only around 19 -- noticeable but not alarming, and (b) the yield curve is no where near flat. So, bottom line, I'm not losing any sleep any time soon.

>>386209

I buy dips when they come.

>>386209
>>386226
what constitutes a dip?
how much of a % change?

>>386247

Depends, short term, intra-weekly trades a 10 pt move in SPX can be a good dip to buy. For longer term, when in a bull market a mcclellan oscillator print (unadjusted) below -200 tends to give great buying opportunities. In a bear market, maybe wait for a -250 to -300 but the dips are more severe and longer lasting so you have to hunker down and just wait until the bear market is over.

>>386251

Pic related. Purple is the oscillator. Of course it doesn't work all the time but if you believe we are in a bull market, then a -200 print the time to add more aggressively.

>>386254
i like long-term
may i ask how you generated that chart? (programme?)

>>386257

thinkorswim

>>386181
Top lel m8. You should add/edit about how he doesn't refute points brought against him.

>>386090
Trisquel musty rice reporting in.

> Summer 2014
> Overweighting in small-cap gold stocks.

>>386219
The yield curve would be practically impossible to invert at this point and it should be clear why. The Federal Reserve's balance sheet has exploded from about $800bln in 2007 to over $4tln ($4,000bln) now. At a yield of 2.5% for 10-year Treasuries, yields are not going to go lower unless there is another crisis.

The tangible warning signs that something is terribly wrong with the markets:

1. The Federal Reserve balance sheet
2. The continued high unemployment rate in the U.S. The jobs created since have largely been crappy jobs. Also, the percentage of the people of working age who are employed is at a 30+ year low. Remember what Henry Ford understood: Your workers have to earn enough money to be able to buy the product they create.
3. ZIRP and QE
4. $1tln of non-dischargeable college debt
5. Historical record of Federal Reserve tightening after a binge of easy money. The creation of a lot of money causes inflation. As that money is removed to prevent an inflation, it inevitably causes a harder landing than the Fed expects. See 1994, 2000, and 2008. Yes, this is a limited window because the funny money policies of Fed really took off around the 1994 bond disturbance.

I fully admit the P/E ratios are not lot they were in 1999, which was the *big* tip-off that if you bought, you were going to lose your ass. A Case-Shiller P/E of 19 is not insanely high but it is higher than the historical norm of about 15. Also, how much of the earnings are real and sustainable versus earnings that will vaporize when government support is taken away?

The U.S. is in a so-called output gap trap where government has stepped in to provide money flow since the private sector is ill and not recovering.

If the U.S. were creating good-paying, real jobs and new college graduates en masse were getting solid jobs paying $50,000/year or more instead of being unemployed or underemployed (Starbucks barista), I'd go all-in with my unallocated assets in the stock market.

I like how iHaz comes in and literally just spouts a bunch of bullshit, most of which doesn't make any sense (but sort of sounds good) and then gamma comes in, calls him a fag and posts actual useable tips.

>>386382

The run-up to the 2008 bust felt like a real recovery, especially for Wall Street and maybe for you. (I'm not exactly sure if corporate lawyers experienced a boom during false recovery fueled by the housing bubble.)

However, the vast majority of the jobs created during the post-2000 recovery was based on convincing people to extract equity from their houses to spend on junk. This, along with the easy money, no-regulation policies of the Fed fueled a false recovery based on debt and debt instruments that were obviously going to default.

The jobs created included:

1. The Wall Street jobs to create and package debt products
2. The mortgage brokers jobs
3. The real estate agent jobs
4. The various jobs that are created related to a housing boom: furniture, redecoration, appliances, etc.
5. Discretionary spending from equity extraction. Remember Bush's comments after the September 11 attacks? He encouraged to go out and spend money. Take a vacation, go to Disney Land. This was all done on debt.

Doesn't the above sound somewhat similar to what we have now? This is yet another "jobless recovery" based on debt (contrast with recessions prior to 1990). Total outstanding student loan debt now tops $1tln, junk bonds yield about 5% or 6%, and the distortions of the economy were not addressed post-2008.

It's the debt that's the problem: it must be repaid, or else.

>>386382
>The yield curve would be practically impossible to invert at this point
I don't disagree, and its a pretty bullish sign. I'm sure you've already read the studies, but just in case you missed them, let me get you started.

http://www.clevelandfed.org/research/data/yield_curve/

Some highlights:

"yield curve inversions have preceded each of the last seven recessions"

"a flat curve indicates weak growth, and conversely, a steep curve indicates strong growth. One measure of slope, the spread between ten-year Treasury bonds and three-month Treasury bills, bears out this relation"

"we can use the yield curve to predict whether future GDP growth will be above or below average"

You have fun looking at whatever you consider relevant. I'll keep looking at what the Fed itself considers important.

>>386395

You also have to take into account that thanks to ZIRP, debt is more affordable than ever.

>>386400
I've seen the Fed's reports and comments. However, doesn't it strike you that 0.00% - 0.25% for the Fed funds rate and QE to drive down the yield at the long end kind of invalidate all of the stuff they say? It's not comparing apples with apples since the Fed is such a big player in the markets versus the periods that it uses for historical reference.

The only other period that's comparable when the Fed manipulated rates so much is WW2--another highly unusual environment. Post WW2, there was tremendous government intervention to prevent inflation from running amok but the U.S. had a productive economy with the rest of the world in shambles.

You keep doing what you're doing. Your cost basis is low so *if* there is a nasty correction, it won't really matter too much because you'll still have a nominal gain and you will have gotten dividends during that time. My current equities positions are long term holdings and I've held them for 10+ years so it would be shocking for me to actually lose money on these things on a nominal basis.

For people who had large wads of cash and are only now thinking about jumping into the markets, I can only say that I think they're buying somewhat dear (perhaps very dear) and they can expect substandard returns over the coming years.

Note I say "somewhat dear" or "perhaps very dear." I don't actually know because the meter stick we use to measure value, US Treasuries, has been warped by Fed policies.

FWIW, If people were 100% cash right now and asked me for allocation advice, I would recommend a Permanent Portfolio. In a normal economy, I would not recommend a PP with its lower returns than something with greater exposure to equities.

>>386405
Yes, it makes debt more affordable but it also causes an increase in debt. For corporations, it's been a real boon allowing companies like Apple to play strange arbitrage games: borrowing money to pay dividends and then using retained earning to pay off the debt thus avoiding corporate taxes. (I seem to remember that was the trick.) It also allows crappy companies that should be dead to continue living by borrowing money much more cheaply than they should.

On the consumer side, though, it makes people who have existing mortgages to further lower their payments and drives up housing costs. However, that means every person who doesn't have a house will now have to borrow more money to buy the same house. In the end, the monthly payment remains the same.

Many people don't understand that this is the trick of mortgage financing. They think that 4% 30-year mortgage rates make housing more affordable. It doesn't! It only makes the banks richer, especially since they can sell to Fannie and Freddie. The mechanics behind mortgages and real estate prices is clearly described by Dr. Michael Hudson.

>>386408
QE might depress the position of the curve, but I don't see it artificially altering the slope. I'm not looking at the absolute data points; I'm looking at the spread between the ends -- because that's what the research says is relevant.

I do worry about inflation, and I do think inflation will be the factor that finally ends the current bull market (barring a catastrophic news event). But that could be a very, very slow process that spans many, many years. In the meanwhile, I see more years of performance like 2010, 2012, and 2014 YTD. Maybe even with another 2013 thrown in for good measure.

Will there be a correction in there? Perhaps. Probably not one that triggers a bear market, and almost certainly not one that precipitates a recession. Demand for equities remains very high, now and for the forseeable future. That suggests a quick bounceback. My guess is that anyone trying the buy the dip will mis-time it, as they usually do.

Anyway, the next 5 years are a drop in the bucket for long-term investor. Stocks aren't cheap, I agree, but there's no basis to call them dear either. And then you have to consider the cost of doing nothing. Staying on the sidelines yields nothing but regret and lost opportunity for the long-term investor.

The big question unanswered is,
Does the inter-rate rate trading scheme and the HFT systems prop up this inflated valuation system?

I bring this up because it isn't even about quarterly earnings, forecasts, predictions. My gut says something is inherently wrong.

I'm "based" that the fact is the "process/system" is extrapolating derivative based interest as profit hence overall rise in value, in-spite of how things are actually going.

When is a toxic asset/stock/shell corporation valuable? When it is a tax write off.

The market should be hyper bear however due to the market "shutdowns", short stop orders, and a slew of other components that have been integrated I don't foresee a balancing out of this equation.

The bullet-train just keeps getting faster the problem now is we can't take any action until it derails globally.

>>386414
QE is specifically and artificially altering the slope of the yield curve. Yield curve shaping is one of the Fed's tools right now do whatever it is they're trying to do, purportedly trying to resuscitate the economy after the Fed drove it over a cliff and into a ditch. If the Fed were to return the yield curve to what it was like, say, in the mid 1990s with 5% funds rate and may 8% for 10-year Treasuries, get ready for a crisis.

The cost of doing nothing could be dear as I felt last year as I had too much cash. Buying dear would be similar to someone investing a large sum of money in 2007 or early 2008. Substandard returns.

Again, the capital gains from 2009 onward have to be viewed through the lens of the extraordinary efforts by the Fed and all the other major central banks of the world to flood the system with money. The gains are hardly normal and not based on increased productivity.

Gains from QE kind of violate one of the principles of what money/wealth is: a representation of productive effort.

>>386418
HFT doesn't drive up stock valuations longer term where longer term is maybe two seconds for those guys. HFT is mainly about filching pennies off of people, extracting a vigorish.

It's a different matter altogether when you have an entity that can create money without working or doing anything productive and using that money to buy assets. That entity, let's call it the Federal Reserve, doesn't care about fundamentals or whether an asset is dear or not. If things go badly, it can just create more money, depreciate the money others earned and hold, and asset prices will rise again eliminating the loss.

>>384590
>buy some twitter actions
>get 33% in a couple of days

Step it up senpai.

>>386418
I predicted correctly the exact value of the 2007/2008 crash. At 7100. (Funny it went to 6500 something.)
Made a push into all stocks that had at least 100 mil in cash (GE,AMD,etc)
In 2012, I dumped all my stock. (Market was at 12.5k) I did not have GS.
I got 200%.. From my initial 30k

The market is too high for me to go back in, for a long term stretch.

>>386427
Are any currencies backed by any standard? Anymore?

>>386424
>QE is specifically and artificially altering the slope of the yield curve
I don't see it, and the facts don't support you. If you were right, and the Fed was trying to manipulate the slope of the curve, we'd see the long-term rate move in a steady direction as QE was implemented. However, look at the chart. The 20-year rate did move down initially, but then investors came back. Even as QE pushed the short-term rates to zero, the long-term rates didn't move in lockstep.

Now perhaps you've gotten confused somewhere and conflated QE and Operation Twist? They're not the same thing, as you must be aware. Operation Twist can be said to moderate the slop of the curve, but the effect as much less marked than QE.

>>386424
>The cost of doing nothing could be dear as I felt last year as I had too much cash.
I suspected as much. I seems that most of the people screaming about the immanency of a market correction are those who missed out on recent gains. They (and you) will deny it, of course. Psychology has a twisted effect on people's investment views. It's why I stick with scientific approaches.

>>386424
>Again, the capital gains from 2009 onward have to be viewed through the lens of the extraordinary efforts by the Fed and all the other major central banks of the world to flood the system with money. The gains are hardly normal and not based on increased productivity.
Yes, and no. QE was (and is) a tool position companies for future growth despite sever problems in the financial sector.

Your statement regarding productivity is demonstrably false however. Its like you just make stuff up when it pleases you.

>>386444
>If you were right, and the Fed was trying to manipulate the slope of the curve, we'd see the long-term rate move in a steady direction as QE was implemented. However, look at the chart.
Too many charts. Here's the one referred to in my first paragraph.

>>386408
>Your cost basis is low
I've never posted my basis information on 4chan. So either you're the samefag as >>386122 or this thread is filled with desperate idiots.

>>384590
That means the economy is reaching a healthy state. Sorry parasite.

relevant to my interests, I am currently looking into various market risks other than old bull market with a few overvalued companies and bubbles

china might be hiding a financial crisis, their government is secretive, their private sector engages in shadow banking, the cracks have already started to show

a fragile euro and various other currency and debt problems in other countries like Turkey and Argentina might be the next dominoes to fall in a crisis, but alone aren't enough to trigger one

Why are you guys on /biz/ this dumb? You can't predict the future and the stock market always goes up as long as there are untapped markets (topkek, like 5+billion people atm) and natural resources. None of those will end during our lifetime.

Just invest and keep putting money in each year or more often, minimize fees of all kinds (brokerage fees, ETF/fund management fees etc) and become rich over time.

All you "traders", get a well paying job you morons. Trading doesn't work for 99% of people, you are very likely just another failure waiting to happen.

>>386103
you might want to shut the fuck up

>>386478

>china might be hiding a financial crisis
>might be

They're offering urban hukou to Chinese citizens who purchase property in a bunch of cities. The Chinese property market is in serious trouble, and the property market has been what leads the Chinese economy. Sales are slowing, cement, steel, etc consumption has fallen off a cliff, and CCP officials have been injecting money into the economy for a while now.

Shit, the Chinese manufacturing sector expanded for the first time this year only a day or two ago, in part to these mini-stimulus packages.

>>386469
I am the person who is claiming that certain things are predictable, such as the NASDAQ crash of 2000 and the housing bubble crash of 2008. Note I am not saying that I was able to predict the when of those crashes although I know people who did. I did, however, know that those crashes would occur and I also knew when markets were overvalued and no longer worth playing.

I am saying you have a low cost basis because, from what I understand of your investment style based on what you've written over the past few months, you started contributing to index funds fairly early in your career. Being that you're about 45 years old or so, your cost basis is going to be low. Also, since you say you don't play timing games, I'm quite certain that you didn't stay in cash and then go all in late 2008, early 2009. These are reasonable deductions on my part and I suspect they are correct.

Also note that I did not say the quantity price of your cost basis. I can only guess but if what you've said in the past is true, I can say with a pretty good degree is certainty that your cost basis is at most 50% of your net worth and far more likely 33% or less of your net worth.

This has been a pretty intereesting back-and-forth with you. You have presented data I have seen before but you have not addressed the peculiar circumstances of the current environment (ZIRP, massive Fed balance sheet, etc.) Also, one of the first things I pointed out was the massacre in 2008. I'm not looking to get into an argument with you but if you were in index funds during that time, I already speculated that your net worth probably fell by 33% or more. The S&P 500 fell by 50% during that time and if you held index funds in emerging markets fell more than that.

[To be continued....]

>>387563

Point being: Your current net worth is not the result of an economic recovery nor any great financial acument on our part. Had it not been for the funny little bailouts and other programs on the backs of savers, you would have suffered a very dear loss.

We're all aware that you've done well. However, I'm saying that just because you've done well doesn't mean you understand what is going on in the economy and you cannot assume that everyone who presents a different view from you is a liar, uneducated, or wrong.

I've written enough on this thread to present another view for the readers. For very young, averaging in to an index probably makes sense for them. They don't have enough capital to really take a large bath and they've got plenty of time to recover. But they shouldn't assume that the past 30 years is indicative of the kinds of returns they'll see the next 30 years.

BTW, we have the IDs in this board. You'll see that I've not samefagged as my posts on this thread all have the same ID. Also, I think you should recognize my writing style on this thread, too.

>>386781
And thank you for contributing so much intelligent debate here. People may disagree with iHaz or what I write but at least we have offered some sort of reasonable arguments for why we have the opinions we do.

I'm sure someone will find, "Shut the fuck up," to be a real money maker.

For people looking to try to either make money or not lose their money, I hope you guys have gotten some ideas to think about from this thread.

>>386444
Operation Twist, as we're both aware, started buying out longer on the yield curve. I don't remember how much money it was but it wasn't anything last the QE last year which create $1tln of new money. But no, I am not confused. QE is designed specifically to drive down yields. The Fed will say some other rubbish about providing liquidity but there is already plenty of liquidity for credit-worthy entities. Or are you saying that asking corporations such as Apple and Google to pay 5% on debt constricting liquidity? I will say again: there was already plenty of liquidity even before the last round of QE. QE was primarily done to create a wealth effect and maybe prevent the Fed from getting into a liquidity trap a la Japan the past 20 years.

BTW, you do not have a scientific approach. You have a statistical approach, which is very different. Economics is not a science and statistics can show correlations that mean nothing. Would you be willing to state how much your net worth changed from 2007 to March 2009 on a percentage basis? I keep hammering on this because, much to your chagrine I'm sure, I insist that these are unusual times and the losses in 2000 and 2008 in such close proximity are symptoms of a broken system.

QE positions companies for future growth? I would agree that it pulls demand forward in hopes of jump-starting the economy so that its in self-sustaining growth mode. But demand, once pulled forward, must either be given back or some sort of stagnation must occur while new demand builds up.

And no, I do not make stuff up as it pleases me. Please show me the same courtesy I have tried to show you (check out my ID).

>>387592

>Please show me the same courtesy I have tried to show you (check out my ID).

ihaz is an arrogant asshole. I don't see how you haven't realized this yet. He won't debate with you. He'll just ignore your posts and repeat his wrong ideas over and over.

>>387563
>I am saying you have a low cost basis because, from what I understand of your investment style based on what you've written over the past few months, you started contributing to index funds fairly early in your career.
Actually, I didn't become a committed Boglehead until after the dot-com crash in 1999. And since I've purchased various equities (and bonds) throughout that period, as well as employing a variety of annual tax strategies, I have investments at many different basis levels.

None of this is particular relevant, though. The quality of my advice is not dependent on the levels that I bought in to the markets. You suggest that in the event of a correction, I'm better positioned to absorb a loss, while new investors would be hurt to a greater degree. Actually the opposite is true. For a young investor, at the beginning of a 30-40 year plan, an early dip is an insignificant blip on the radar.

You are free to disagree with my suggestions or views, but don't imply that my vision is skewed because of my age or wealth. I'm well aware of the target audience here and I tailor my advice accordingly.

>>387563
>You have presented data I have seen before but you have not addressed the peculiar circumstances of the current environment
I don't concede that the circumstances are peculiar, at least not in any way that's relevant to making near-term investment decisions. Fears about QE phase-out have so far proven unfounded. Yes, bonds are unattractive, but this is hardly the first time that yields have been low. Show me some economically meaningful way in which the paradigm has actually moved permanently; otherwise, buy-and-hold still rules the day.

>>387596
He's not really arrogant he just has nothing else to resort to so he pretends to be arrogant in response to or in preparation of being pointed out as a retard. It's a defensive coping method.

>>387613
I forgot to mention again that he's at least in his late forties and hangs out on 4chan. I bet his Truecrypt drive is just full of cheesy goodness.

>>387619

>retired 40 yr old "corporate lawyer" (why would you retire at 40?)
>$10M+ net worth
>browses 4chan everyday

One of these things is not like the other.

>>387564
>Your current net worth
My current net worth is largely the result of my generous income, not because of the Fed's economic policies.

>just because you've done well doesn't mean you understand what is going on in the economy
I've never claimed any such thing. However, the fact remains, all modesty aside, that I'm one of the (if not the) smartest, best educated, and most experienced people who actively contribute to this board. My wealth may not qualify me to comment on economic theory ... but my intelligence, my education, and my business and legal experience most certainly do. And if I'm dismissive of contrary opinions, I blame the culture of the anonymous message board. If you think always being polite and dilettante gets you far on 4chan, you haven't been here long enough.

>>387567
>thank you for contributing so much intelligent debate here
I'm always happy to engage in a spirited debate, and I always try to be (mostly) respectful to people who show me the same courtesy. Unfortunately the onset of Summer has dramatically lowered the quality of the board's content. If I misdirected a shot across the bow in your direction, I apologize.

>>387592
>QE is designed specifically to drive down yields
QE only significantly affects the short end of the curve, as the chart I posted above illustrates. The Fed recognized this and instituted Operation Twist in an attempt to move the long end too. However, the Fed quickly ran out of short-term securities to sell, and Twst ended in 2012. And yet, the long end of the curve has stayed high(-ish) all on its own. As I said before, its actually a bullish sign.

>>387628

>smartest, best educated, and most experienced people who actively contribute to this board

You legitimately believe that the stock market is a repository for money. There's that arrogance too.

>QE only significantly affects the short end of the curve, as the chart I posted above illustrates

None of the charts you posted illustrate that.

>>387592
>BTW, you do not have a scientific approach.
I disagree entirely. The studies that I cite are peer-reviewed scientific papers by economists. That they do not lead to black-and-white results is fully expected in a system such as the markets. All investments entail risk. How best to incorporate that risk into one's investment strategies, optimally according to one's needs and goals, is scientific. Trying to marginalize thoughtful economic analysis because it relies on statistics is naive and unhelpful.

>>387592
>Would you be willing to state
Give me a start date and I'll run the report. I fail to see how it could support your contention, but I'll give you opportunity to make a case. Frankly, I see the proximity of 2000 and 2008 as nothing more than coincidence, fully expected and natural. Stocks do fall, all the time in fact (pic related). It doesn't mean we've entered spooky times.

>>387596
Another insightful post. Drinking again, I see.

>>387640

S&P 500 didn't exist before 1957.

>How best to incorporate that risk into one's investment strategies, optimally according to one's needs and goals, is scientific.

How do you scientifically define risk? You can't.

>Frankly, I see the proximity of 2000 and 2008 as nothing more than coincidence, fully expected and natural

No causality in a dynamic system like an economy? Ok.

>>387625
Sorry, the Millionaire-chan forum where I usually post is down for extended maintenance. I'm slumming here to pass the time.

If your tiny brain can't grasp the concept that wealthy people are, fundamentally, the same as everyone else, then please anhero at your earliest convenience.

>>387650

>If your tiny brain can't grasp the concept that wealthy people are, fundamentally, the same as everyone else, then please anhero at your earliest convenience.

No I'm only saying YOU are different from everyone else. In that you are barely literate.

>>384683
Do you not realize that the spikes are after the crash (earnings plummet)

>>387658

Shhhhhh...you're gonna hurt his head.

>>384926
>SiriusXM
Nigger you cant...

>>385403
Remember when it got revised down to -1.0% and the market didn't even budge. That's when I got out.

>>387658
nope.jpg

There's actually no correlation between P/E spikes and market crashes.

>>387667

>There's actually no correlation between P/E spikes and market crashes.

HOLY SHIT.

THE MARKET PRICE IS LITERALLY THE NUMERATOR OF THE P/E EQUATION.

>>387682

>posting pictures means I'm right

>>387667

>There's actually no correlation between P/E spikes and market crashes.

Also where's the scientific™ evidence for this assertion? You only posted a picture from a blog. And our eyes are great at deceiving us, especially when it comes to charts.

>My life erryday on /biz/.

>>387691

You are too dumb to recognize. You never answered these questions either. >>385887 Your inability for self-reflection is astounding.

>>387695

And there you go folks. He dodges all legitimate argument and posts witty pictures instead. He doesn't understand the function of clearing and post-trade settlement, and he thinks the market is a repository for money. That's all in this thread alone.

Stop pandering for my attention. Do I look like Ask Jeeves?

>>385846
>Only if there's excess demand.

Wrong, he can price it however he likes, even if it's overpriced.

>>387727
>Wrong, he can price it however he likes, even if it's overpriced.
Of course he can. But it won't affect market capitalization unless its in the bid/ask range. If there's no demand to actually buy at the listed price, the ask just sits meaninglessly on the order book.

Market capitalization is based on the *current price* of shares, not the entire order book. I could list 1 share of GOOG for $10 bazillion in the morning, but that wouldn't change the market capitalization by a penny.

>>387735

>Of course he can.

So you admit I'm right.

And my answer was the response to your false assertion that a change in market cap requires an exchange of cash. So I don't see what your point is now.

Remember if one person can do it, what is stopping everyone from doing so? Nothing.

>inb4 efficient markets

Markets don't always behave so, that's why bubbles exist.

>prove he's wrong
>he posts "you admit I'm right"
>mfw

>>387702
Hey
Just wondering
What's the purpose/function of clearing houses and why do they exist?
(2 part question, please answer both parts, no maymay pictures)

>>387753
Not even
Nice meme

Click on my ID, it will highlight my posts. I have posted pretty much nothing related to this thread

But after observing and reading every post ITT, I'd like you to answer

Please answer

>If your not smart enough to start a debate with a statement, then start with a question and hope no one catches on.

>>387760
whatever dude

>>387761

>>387761

I don't know why people listen to this guy. As you see when you ask him a question that requires actual knowledge to answer and not retarded bloviation, he resorts to namecalling and " le epic maymay" pictures to "prove" his argument. He seems to be unable to think abstractly which makes me wonder how he made so much money as a "lawyer."

All this in addition to frequently calling out samefag on a board with IDs.

>>387767
What purpose does my answering your leading question serve? All you'll do is nit-pick my response, or finding no fault, insult my grammar or spelling. If you have a point to make, then make it. Have the intelligence to articulate your points without relying on rhetorical tricks or ad hominem attacks. You know, like an adult.

Unfortunately, you've already proven, to me, that you're incapable of such discourse. You get maymays because you deserve maymays.

Also, your trip keeps slipping on and off. Maybe that happens when you change your proxy.

>38771

My trip keeps slipping on and off because I only use it when postimg on /biz/.

I try and prod you to see foryourself why you are wrong. But you just call me a troll. Ok, so be it.

I say for every dollar that goes into the market, one dollar comes out so the net flow is always zero.

You say, nope wrong idiot.

I say look at the function of clearinghouses. Their entire purpose is to guarantee the dollar in, dollar out property if the markets.

You respond with, nope wrong idiot.

>>387777
Are you drunk?

>>387786

No im typing on an ipod touch b/c i cant sleep.

Correct trip i believe :^)

Anyways, this stuff is fascinating when you think about it. The actual limits on market behavior/movement. What you ultimately get is that the market is a VERY fluid entity that can absorb all kinds of pressures.

>>387777
>I say for every dollar that goes into the market, one dollar comes out so the net flow is always zero.
So what you're asking, I gather, is whether the stock market is a zero sum game. Like with gambling, where every dollar won is also a dollar lost.

Thinking the stock market is a zero sum game is a common misconception for new investors. However, stocks aren't wagers. They're ownership interests in companies. The value of those interests can (and do) change based on numerous factors such as the economic outlook, profit forecasts and valuations. Indeed, the value can change without a single share changing hands, such as would happen in a market with excess demand.

The complexities of the markets are beyond the scope of this simple reply. I suggest you do some research on the zero sum question if you still feel confused. Here's a starting point:

http://www.bfsinvest.com/resources/investment-commentary/2003/3_2003.pdf

So there's no doubt, the authors answer your question the same way I do:

"Is investing simply a process of transferring money from the losers to the winners? The
simple and accurate answer is no."

>>387808

I did NOT say the market is zero sum. Dividends obviously prove that wrong.

Think about what happens when you buy a stock. You give up cash and get a stock. The sells gets cash and guves up stock. The cash the seller gets = the cash you pay. Dollar in (you pay), dollar out (seller gets paid). The market price represents the exchange rate dollars for stock at which this transaction occurs. Obviously the exchange rate can move WITHOUT an exchange occuring, ie tje market value of a stock can change without trades occuring. Which does happen when a stock gaps.

>>387814
Yes, we all know that the price of a stock is the amount of money at which a willing seller and willing buyer are paired. Did you have a point to go along with that?

Clearing housrs guarantee that when you sell a stock yoy do get paid and when you buy a stock you must pay up. Dollar in, dollar out.

Zero sum game refers to the change in net worth of market participants which is a different subject from market transactions.

>>387819

Wow. I tried to be civil, now I'm done. You truly lack the ability to think abstractly.

BTW, my point for the 20th was that cash is incidental to the process. But If A, then B is too much for you. I don't know how much clearer I can make this.

Yeah, you lost me chief. This whole discussion started with net inflows into mutual funds, which is an indication of *demand* and not a raw market transaction.

>>387826
You seem to be having another bad day.

>>387389

BTW2: Way to go with "yes we all know" for something you called me an idiot for asserting earlier.

>>387829

My day wasn't bad. I like arguing with you because your stupid. It's so easy.

>>387830
>>>387389(Cross-thread)

You just cross-posted to some thread about hookers. I guess we now know why you're distracted. Enjoy your paid sex.

I told you im on an ipod touch and im typing quote links by hand. I messed up. But thats all u got? I have like 5 posts in a row with your inconsistencies and you attack a misquote AFTER accusing me of resorting to petty arguments like name calling and grammar correction.

:^)

I've responded to everything you've said. I'm not sure how debates work where you come from, but I'm not in the habit of beating dead horses. If you have something further to say, then say it. I realize that you enjoy my attention, but I find the current discussion tedious and repetitive.

>>387849
>typing quote links by hand
Mkay. Just an unfortunate coincidence, I'm sure. I, for one, believe you. 100%. Pic definitely not related.

>>387682
>>387691
>>387695
>>387702
>>387735
>>387747
>>387753
>>387760
>>387765
>>387771
>>387836
>>387861
There's a near-50 year old man who not only posts unfunny memes but has an unfunny meme collection folder on his computer.

>>387670
This is comical as fuck.

How can you be this fucking retarded? I wish we had a /g/entooman here who could dox this faglord.

Final Q1 GDP numbers released: -2.9%

>implying that this "recovery" is something more than a glorious dead cat bounce fueled by CB liquidity

>>388055
>it's the weather

>>388061
The court of popular opinion doesn't seem worried.

>But, but but how do I buy the dip when there's dip?
>The dip was yesterday, anon. You missed it, again.

>>388061
The court of popular opinion doesn't seem worried.

>But, but but how do I buy the dip when there's no dip?
>The dip was yesterday, anon. You missed it, again.