This guy thinks a 30% drop is coming

[Zwaen]

I did buy some volatility though at these levels, just to (imperfectly) offset the long positions. It will probably lose, but that’s oké

 

[v-shape-0DTE]

Unfortunately all the bearish guys are dead broke from this 33% s@P 10 month move . So its too late for most shorts and irrelevant if we drop big . Whats funny about this last 12-18 month move is fed fund rates never dropped and overall earnings are atrocious . I read yesterday earnings ests for 2024 are now the exact same as they were 2 yrs ago for 2024 . There’s no way the economy really accelerates here . People are drowning in debt . The problem the fed has is asset prices have been screaming to all time highs month after month (stocks ,Housing etc). There’s way too much wealth in the system . If they lower rates to much inflation will scream again . It could be the $ dropping big to cause it or wealth demand just buying goods. This is the pandora box the fed finds itself in . Recessions in the economic cycle are very important to suppress demand and reset the bar. The Fed has not allowed a real recession since 2009(Covid was a few months event). There no Big drop to bounce off to sky the economy . Now were in a ho hum sideways for ever type economy just muddling around .

You said it right there in the end. Recessions aren’t a thing anymore.

 

[mervyn]

reading the responses on this thread is scary, 2022 was that long ago. where were you then?

 

[NoahA]

Unfortunately all the bearish guys are dead broke from this 33% s@P 10 month move . So its too late for most shorts and irrelevant if we drop big . Whats funny about this last 12-18 month move is fed fund rates never dropped and overall earnings are atrocious . I read yesterday earnings ests for 2024 are now the exact same as they were 2 yrs ago for 2024 . There’s no way the economy really accelerates here . People are drowning in debt . The problem the fed has is asset prices have been screaming to all time highs month after month (stocks ,Housing etc). There’s way too much wealth in the system . If they lower rates to much inflation will scream again . It could be the $ dropping big to cause it or wealth demand just buying goods. This is the pandora box the fed finds itself in . Recessions in the economic cycle are very important to suppress demand and reset the bar. The Fed has not allowed a real recession since 2009(Covid was a few months event). There no Big drop to bounce off to sky the economy . Now were in a ho hum sideways for ever type economy just muddling around .

What if the reason for the never ending rally in equities is because of something similar to Weimar Germany? What if we are seeing the beginning stages of hyperinflation?

Its like if you're getting sucked into a blackhole. At first you're moving slowly, so you think everything is ok, but you don't yet realize that you're already past the point of no return because when you turn our engines on to escape, you realize that you already can't outrun the grasp of the blackhole.

So here we are today, trying to figure out why the market keeps going higher with all of these problems, but we fail to understand that nobody is buying because of economic factors, but simply to escape currency debasement. The markets are clearly telling us that as more bad economic news comes up, the market goes higher, since they are expecting lots of easing. So if people are buying based on a hyperinflation theory, rather than economic factors, we could already be in that blackhole.

 

[mervyn]

What if the reason for the never ending rally in equities is because of something similar to Weimar Germany? What if we are seeing the beginning stages of hyperinflation?

Its like if you're getting sucked into a blackhole. At first you're moving slowly, so you think everything is ok, but you don't yet realize that you're already past the point of no return because when you turn our engines on to escape, you realize that you already can't outrun the grasp of the blackhole.

So here we are today, trying to figure out why the market keeps going higher with all of these problems, but we fail to understand that nobody is buying because of economic factors, but simply to escape currency debasement. The markets are clearly telling us that as more bad economic news comes up, the market goes higher, since they are expecting lots of easing. So if people are buying based on a hyperinflation theory, rather than economic factors, we could already be in that blackhole.

credit supernova redux, i'd say. everyone dies.

https://williamhgross.com/credit-supernova-redux/

With credit now expanding, the sophisticated economic model provided by Minsky was working its way towards what he called Ponzi finance. First, he claimed the system would borrow in low amounts and be relatively self-sustaining – what he termed “Hedge” finance. Then the system would gain courage, lever more into a “Speculative” finance mode which required more credit to pay back previous borrowings at maturity. Finally, the end phase of “Ponzi” finance would appear when additional credit would be required just to cover increasingly burdensome interest payments, with accelerating inflation the end result.

 

[SunTrader]

ET's ignore/block is pretty dumb. If you ignore/block someone, they shouldn't be able to post in your thread for example. It's like what's the point of it when that blocked person can derail your own thread having side discussions confusing the you the OP.

I have no problem with it.

Obviously I "see" posts that are there but not seen by me. I no longer care what they might be saying and have no confusion about it. Others, oh well.

 

[SammyJ]

What if the reason for the never ending rally in equities is because of something similar to Weimar Germany? What if we are seeing the beginning stages of hyperinflation?

Its like if you're getting sucked into a blackhole. At first you're moving slowly, so you think everything is ok, but you don't yet realize that you're already past the point of no return because when you turn our engines on to escape, you realize that you already can't outrun the grasp of the blackhole.

So here we are today, trying to figure out why the market keeps going higher with all of these problems, but we fail to understand that nobody is buying because of economic factors, but simply to escape currency debasement. The markets are clearly telling us that as more bad economic news comes up, the market goes higher, since they are expecting lots of easing. So if people are buying based on a hyperinflation theory, rather than economic factors, we could already be in that blackhole.

If that were the case the $ index would be not far from its 52 week high and up from 3 yrs ago . I think Weirmar is much less likely to here do to the size of our economy in relation to the world . If prices get to high people stop buying here as evidenced by restaurants and many retailers doing poorly . I think people have never been overall hurt holding stocks the last 45 yrs as we always went back to highs quickly . One day when we stay down month after month for 1,2,3 plus yrs people will walk away and cash in

 

[SunTrader]

What if the reason for the never ending rally in equities is because of something similar to Weimar Germany? What if we are seeing the beginning stages of hyperinflation?

Its like if you're getting sucked into a blackhole. At first you're moving slowly, so you think everything is ok, but you don't yet realize that you're already past the point of no return because when you turn our engines on to escape, you realize that you already can't outrun the grasp of the blackhole.

So here we are today, trying to figure out why the market keeps going higher with all of these problems, but we fail to understand that nobody is buying because of economic factors, but simply to escape currency debasement. The markets are clearly telling us that as more bad economic news comes up, the market goes higher, since they are expecting lots of easing. So if people are buying based on a hyperinflation theory, rather than economic factors, we could already be in that blackhole.

Until Bitcoin (or even good old Gold or other alternatives) prove it can move higher without equities (especially tech) also moving higher what's the point of all this doom and gloom hyperinflation talk?

 

[SunTrader]

If that were the case the $ index would be not far from its 52 week high and up from 3 yrs ago . I think Weirmar is much less likely to here do to the size of our economy in relation to the world . If prices get to high people stop buying here as evidenced by restaurants and many retailers doing poorly . I think people have never been overall hurt holding stocks the last 45 yrs as we always went back to highs quickly . One day when we stay down month after month for 1,2,3 plus yrs people will walk away and cash in

Define: quickly?

Many times it has taken multiple years, 5 or more. Is that quickly?

 

[NoahA]

Until Bitcoin (or even good old Gold or other alternatives) prove it can move higher without equities (especially tech) also moving higher what's the point of all this doom and gloom hyperinflation talk?

Agreed. I'm just waiting for the government to fuck up. We all know there is no way for them to put humpty dumpty back together again after he was fallen off the wall, but we need them to make a move. I think they are scared shitless. They don't want to drop rates and admit things are falling apart, but these high rates cause more and more spending on debt that they can't afford.

Everyone is expecting massive printing, which will be really good for bitcoin, but I'm thinking they want to cause some fear, so they are really holding off. I think they know asset prices need to come down to try and rebalance the system, but there is no way to do this without everything breaking. So for now, we just wait for the fireworks.