Global Macro Trading Journal

The Fed and Treasury are throwing everything at the problem but the markets continue to panic. I'm going to listen to Howard Marks and some of the commenters here and not buy too much too soon. -35% might not be enough for this market, the total collapse from the peak might even reach -40 or even -50%. At -50%, stocks are definitely a buy. But things arent looking good as of now.

One thing that would definitely make me buy and be very comfortable with US equities is if the Fed announces they will be switching to Nominal GDP targeting. That would pretty much remove any apocalypse scenario off the table (that is, a self-feeding reflexivity driven negative collapse), The virus thing will solve itself in 1 to 2 years, so I'm not concerned about that
 
The Fed might not be ready for NGDP targeting though, it would be a big change. But price level targeting, I think they are. They would essentially promise 2% inflation and would MAKE UP for unhitting that target if that happened. Effectively it would be an open ended QE that would guarantee long-term inflation will be 2%, even if helicopter money was necessary to achieve that. This would pretty much remove any chance of a debt deflation 30's style collapse. So that's a catalyst I'm looking for going forward
 
Daal said:
The Fed and Treasury are throwing everything at the problem but the markets continue to panic. I'm going to listen to Howard Marks and some of the commenters here and not buy too much too soon. -35% might not be enough for this market, the total collapse from the peak might even reach -40 or even -50%. At -50%, stocks are definitely a buy. But things arent looking good as of now.

One thing that would definitely make me buy and be very comfortable with US equities is if the Fed announces they will be switching to Nominal GDP targeting. That would pretty much remove any apocalypse scenario off the table (that is, a self-feeding reflexivity driven negative collapse), The virus thing will solve itself in 1 to 2 years, so I'm not concerned about that
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You can always DCA in over a period of time, until you reach your max equity allocation.

E.g. you estimate the lows will be put in between now and August 1 - about 19 weeks, so each week you deploy 5% of your current dry powder.
 
Specterx said:
You can always DCA in over a period of time, until you reach your max equity allocation.

E.g. you estimate the lows will be put in between now and August 1 - about 19 weeks, so each week you deploy 5% of your current dry powder.
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Yeah, thats what I plan to do but I will be using SPX levels instead. Its hard to see, -45% -50% not being a great moment to buy. So I will be scaling on the way down
 
So the Ackman idea was to buy a lot of stocks today because he thinks its inevitable that Trump will order a shutdown. So he is front running the announcement. I think that makes sense, the question is, how long it will take for them to do that? The states are doing gradually, some cities also. It would be better to do it all at once. If you do a partial shutdown, that's not that great, its like being half pregnant. Its better to shut everything down all that once
If markets tank from here (which I doubt), I plan to be more aggressive in my buys. I bought some BRKB today, I might buy some PSH as well. But I think Ackman is right, Trump will have go to the China way soon, the Administration is clearly panicking as nothing they are doing works, so the shutdown is the last option
 
Looks like we reached a bottom today. The reversal + action to the ECB news seems to show that participants have stepped in to buy in a big way. I deployed all my 'responsible' cash into this drop. I just havent thrown the kitchen sink yet. I still have my gold (which I think will go up so I'm reluctant to sell) my trading cash in two brokers (the money I use for day and swing trades). But I did run out of cash in one of my trading brokers and I got a small debit to IB in my investing account
Maybe I should have thrown the kitchen sink though, I dont know. This sell-off was so retarded. China has laid out the path to solve this so all the countries need to do is just to follow it
 
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