So the equity market is ALWAYS forward looking....

SteveM said:
And then, for the cherry on top, you now have an investor herd that saw stocks go up despite living through a pandemic, massive civil unrest, and a full economic shutdown for 3 months....you will literally now have an investing world that believes that stocks cannot go down, that the Fed truly has made stock markets risk free.
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You're missing a critical point in your cynicism.

The fed has basically nuked any safe investment option. I can't get a 1 year CD better than 1% even to shove some emergency fund money into. For 3 month CDs I'd be luck to see 45 basis points. Bond rates are in the toilet - the 10 year is returning 66bp and the 30 year is at 1.46%.

The result is obvious. People aren't blind to the risk nor do they see the stock market as a risk-free investment. They see it as the only investment that can beat inflation at this point. As it stands money is virtually on fire if it's not invested into an index fund at least. The majority of people can't afford to buy rental properties (probably the only semi-safe investment that could return over inflation) so indexing it is. Naturally this drives a small segment of stocks (the big swinging dicks) up sending indexes higher.

The indexes are divorced from reality. I'm not really using them anymore in my macro analysis of the market.
 
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S2007S said:
In most articles I read, especially today all I hear is that markets are ALWAYS forward looking....


Thats all I hear day in and day out day after day, month after month ...that the market is forward looking. But what makes absolutely zero sense is the fact that how come literally 998899% of the time the forward looking narrative is ALWAYS ALWAYS Positive and never ever ever NEGATIVE????



From the article:

“The market is a forward looking mechanism. They see six months from now, nine months from now there will be more semblance of order. The economy will be coming back, and earnings will be coming back. Estimates have stopped going down,” said Steven DeSanctis, Jefferies equity strategist. “You have the full support of the Fed ... the flows into credit markets have been incredible. The capital markets are open. IPOs and secondary offerings are getting done.”





https://www.cnbc.com/2020/06/02/why...-even-with-massive-unrest-across-america.html
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Yeah because they printed zillions of dollars and flooded the system with cash, devaluing every dollar by 40%. Their positive movements are just equity prices catching up with the resulting inflation.

AAPL's fundamental worth hasn't changed much since 2019, but its dollar measurement has! If In 2019 it was valued at 1T, it's worth 1.4T in 2020 dollars.

...the analysts will call this a "bull market" when prices are simply adjusting to the increased quantity of dollars and resulting inflation.
 
kmiklas said:
Yeah because they printed zillions of dollars and flooded the system with cash, devaluing every dollar by 40%...
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The dollar has not devalued by 40% in one year! A new car last year that cost $20,000 does not now cost $28,000!
 
SanMiguel said:
No but they'll soon rip out 40% of the internal costs :)
Look at meat prices
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That is not a dollar devaluation. That is price gouging, pure and simple. I've been watching LE for quite a while. When beef was $125 it was basically 3.50 per pound ground chuck. When it fell to $77, ground chuck went up to maybe 4.25 per pound. Now it is back to 98 bux per, and ground chuck is still at around $4.25 per pound.

Those supermarkets are worse than fricking gas stations!
 
Professional writers talk about forward looking, backward looking stuff.

Professional traders don't bother about that. You can earn money looking forward or backward. You look at the charts.
 
At one time equity prices were priced based on the 'market' of what investors think it's worth
Now price of the market is based on the interest rates or fed rate and algos who have no position in the 'market' with long and short positions.

All these short positions in the futures are also long. too many hedge funds and too much money in the market with nowhere to go ,,market goes up. regardless of fundamentals or the economy. it's mechanical market rather than fundamental market. well it is fundamental. fed rates is 0% and nobody wants cash or something

The FED is literally buying the market. so i don't understand why nobody selling their stocks for cash. cash is trash. investors don't want cash? it's fed or gov't policy not to allow a crash so they buy the stock market cause you get a wealth effect if the 'market' was to crash. people net worth would fall and it would halt spending as people beleive they are losing money or poorere and Trump gets angry cause stock market is falling to what it's worth or fair market value.

too much fake cash in the market.
volatility has complete drop since the the madness of march 1- april 20

the market was halted due to no cash and no bid. on the downside. S$P was at 2015 levels and was about to go lower. you let the 'market' be a 'free market' its volatile. and there is fundamentally no cash to buy all the stocks if people were to sell in the 'open market'

it's a controlled market and you fools think the futures market has no 'market makeres' the algos, gov't ,and some big player are the market makers. the futures and stock markets move the same direction and very thin market.
 
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Overnight said:
That is not a dollar devaluation. That is price gouging, pure and simple.
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It's competitive pricing.
If the cost of something goes up due to inflation you can either increase your costs or you can start making parts out of plastic instead of metal and hope your customers don't care or don't notice. Obviously there are limits...a plastic engine isn't much good :)
 
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