Stocks likely to drop another 25%

[stinkynuts]

this is actually a widespread consensus, sadly.

the fed pumped up the economy to degrees never seen, printing an unprececented amount of money which jacked up the stock market, and caused soaring inflation. Inflation will not come down for years, and the Fed has no choice to increase interest rates to combat it. However, this will slow the economy which is already in recession, and will lead to a depression, with losts jobs, a crash in the housing market, and weaker earnings from companies. In additon, money will be funneled from the stock market to high yield treasury bonds. The Fed has said it will not lower rates again until 2025. This is a disaster.

 

[poker]

this is actually a widespread consensus, sadly.

the fed pumped up the economy to degrees never seen, printing an unprececented amount of money which jacked up the stock market, and caused soaring inflation. Inflation will not come down for years, and the Fed has no choice to increase interest rates to combat it. However, this will slow the economy which is already in recession, and will lead to a depression, with losts jobs, a crash in the housing market, and weaker earnings from companies. In additon, money will be funneled from the stock market to high yield treasury bonds. The Fed has said it will not lower rates again until 2025. This is a disaster.

Yes…. But no.

Interest rate we’re never going to stay at record lows.

Money is worth less when it’s printed… against gold, or something else that’s backing it. But since ‘71, it’s just money because we say it is.

People will tell you that more money competing for goods is what printing does, and drives up prices…. However, been to a grocery store lately. Where is all this extra money competing for the goods?

Companies are still posting record profits, even in a recession. It’s crazy.

It may go down again, but I am not terrified. We were due for some corrections before Covid.

 

[stinkynuts]

Yes…. But no.

Interest rate we’re never going to stay at record lows.

Money is worth less when it’s printed… against gold, or something else that’s backing it. But since ‘71, it’s just money because we say it is.

People will tell you that more money competing for goods is what printing does, and drives up prices…. However, been to a grocery store lately. Where is all this extra money competing for the goods?

Companies are still posting record profits, even in a recession. It’s crazy.

It may go down again, but I am not terrified. We were due for some corrections before Covid.

good points!

 

[fall]

this is actually a widespread consensus, sadly.

the fed pumped up the economy to degrees never seen, printing an unprececented amount of money which jacked up the stock market, and caused soaring inflation. Inflation will not come down for years, and the Fed has no choice to increase interest rates to combat it. However, this will slow the economy which is already in recession, and will lead to a depression, with losts jobs, a crash in the housing market, and weaker earnings from companies. In additon, money will be funneled from the stock market to high yield treasury bonds. The Fed has said it will not lower rates again until 2025. This is a disaster.

If it was a widespread consensus, everyone would have sold stocks now and went into cash. It is called rational expectations. And, as a result, the stock price would have drop immediately, and not in a few days or even a few months. It is called efficient market.

 

[mclovinot]

Is there anyway to make money in this market? I have seen some youtubers talking about rebounds potentially and playing the USD currency but I am a newbie so any ideas? I think everyone is putting and shorting but I hate following the crowd.

 

[stinkynuts]

Is there anyway to make money in this market? I have seen some youtubers talking about rebounds potentially and playing the USD currency but I am a newbie so any ideas? I think everyone is putting and shorting but I hate following the crowd.

Yes, wait a few months for stocks to bottom. Then simply buy stocks that have bottomed 70-90%. The following are great stocks that have been greatly reduced:

Netflix
Shopify
Nvidia
Norwegian Cruise lines

 

[stinkynuts]

I bought quite a bit of those four stocks, along with Tesla and Google. All great companies, they should do well in the next few years. Think of this as an opportunity to buy stocks on sale. Choose a handful of companies you believe in and hold on to them.

 

[Ceiling Cat]

The FED is trying to cool the economy to reduce inflation. A analogy of what they are trying to do is to put pin pricks into the blimp to ease it down slowly to avoid being in the air during a storm. They seem to be succeeding for now, but any mention of a financial crisis any where in the world would send the markets tumbling. Personally, I would sell off any holding at this time.

 

[fall]

The FED is trying to cool the economy to reduce inflation. A analogy of what they are trying to do is to put pin pricks into the blimp to ease it down slowly to avoid being in the air during a storm. They seem to be succeeding for now, but any mention of a financial crisis any where in the world would send the markets tumbling. Personally, I would sell off any holding at this time.

"would" or "will"? There is a huge difference.

 

[Ceiling Cat]

Would or will, are you willing to take the chance? I am out of the market.

 

[Steve_Stevens]

Drop another 25% and I'm going on a buying spree.

 

[fall]

Would or will, are you willing to take the chance? I am out of the market.

"out" like you had a significant investment in the stock market that you sold and reallocated into commodities/fixed income/etc., or like you did not have any significant long-term investment in the stock market to begin with? We all take a chance (if we have money, of course). There are no such thing as "safe investment", even cash is not safe in real terms. You need to park money somewhere, and stocks are always the best way to do (unless you have your own business, including rentals, of course)

 

[Ceiling Cat]

"out" like you had a significant investment in the stock market that you sold and reallocated into commodities/fixed income/etc., or like you did not have any significant long-term investment in the stock market to begin with? We all take a chance (if we have money, of course). There are no such thing as "safe investment", even cash is not safe in real terms. You need to park money somewhere, and stocks are always the best way to do (unless you have your own business, including rentals, of course)

Out as in no investments at this time. Since Junes the markets has gone into a downward trajectory. I was able to keep buying stocks profitably till the end of August. I still can buy stocks that will make me a profit but the returns are coming in slower and smaller as stock in general are moving lower in price.

Examples :

https://ca.finance.yahoo.com/quote/AC.TO?p=AC.TO&.tsrc=fin-srch Air Canada (AC.TO)

https://ca.finance.yahoo.com/quote/CTC.TO?p=CTC.TO&.tsrc=fin-srch Canadian Tire Corporation, Limited (CTC-A.TO)

I cashed out my long term stocks ( TRP, ENB, CNQ, SU and TOU ) that I was holding for growth, dividends and dividend tax credits in June ) ( + OVV - no div. tx. cr. ) The money is parked in my trading account where at this time where it earns no significant money. That is not to say that it will not be put back to work in 3, 6, 12 months when the climate is better. For now I will spend my time observing the markets and keep up with events.

If you take a look at the two threads below in the Business, Finance and Investing section :

Portfolio Edition : Swing Trade Competition ( 5 Trading Days ) ➤➤➤➤➤ ➤➤➤➤➤ ➤➤➤➤➤

$18K profit so far

You will see that I am able to pick stocks that can achieve a high rate of return. Much more than any business or property can bring me these days. With property prices so high and the hassle of scumbag tenants is it really worth my time. In this business environment where shopping center parking lots are only 20% full is a business worth my time, investment? My assessment of the situation is that it is time to step back and prepare for I believe that stocks will go lower.

 

[fall]

Out as in no investments at this time. Since Junes the markets has gone into a downward trajectory. I was able to keep buying stocks profitably till the end of August. I still can buy stocks that will make me a profit but the returns are coming in slower and smaller as stock in general are moving lower in price.

Examples :

https://ca.finance.yahoo.com/quote/AC.TO?p=AC.TO&.tsrc=fin-srch Air Canada (AC.TO)

https://ca.finance.yahoo.com/quote/CTC.TO?p=CTC.TO&.tsrc=fin-srch Canadian Tire Corporation, Limited (CTC-A.TO)

I cashed out my long term stocks ( TRP, ENB, CNQ, SU and TOU ) that I was holding for growth, dividends and dividend tax credits in June ) ( + OVV - no div. tx. cr. ) The money is parked in my trading account where at this time where it earns no significant money. That is not to say that it will not be put back to work in 3, 6, 12 months when the climate is better. For now I will spend my time observing the markets and keep up with events.

If you take a look at the two threads below in the Business, Finance and Investing section :

Portfolio Edition : Swing Trade Competition ( 5 Trading Days ) ➤➤➤➤➤ ➤➤➤➤➤ ➤➤➤➤➤

$18K profit so far

You will see that I am able to pick stocks that can achieve a high rate of return. Much more than any business or property can bring me these days. With property prices so high and the hassle of scumbag tenants is it really worth my time. In this business environment where shopping center parking lots are only 20% full is a business worth my time, investment? My assessment of the situation is that it is time to step back and prepare for I believe that stocks will go lower.

So, you did sell your long-term investment. I have a different investment strategy, which is buy and hold, so, a few thousand dollars daily gains or losses is nothing to worry about. As a strong believer in efficient market, my strategy is simple: buy when you have money, sell when you need money, do not look at daily price changes, and do not worry about annual performance. Set your time horizon for 20 years and be happy

 

[Ceiling Cat]

I have sold all my long term investments because I believe I can buy them back at a lower price later. If I can get 25-30 up to 50+% return on my stock picks within days I will grab it.
This is not an idle boast, check out the Swing Trade Competition thread, I can do this consistently. After I grab my cash with both hands and make a stash, I call my lady friends with benefits. All three are middle management and make good money to invest. the forth one has moved to another city to pursue a career advancement but I did not kick her out of the investment club. I more than triple their portfolios annually. Why hobby when these three ladies take good care of their Magic Man. The forth one come to town to see her family 2-3 times a year and also to pamper her Cash Kitty.

 

[fall]

I have sold all my long term investments because I believe I can buy them back at a lower price later. If I can get 25-30 up to 50+% return on my stock picks within days I will grab it.
This is not an idle boast, check out the Swing Trade Competition thread, I can do this consistently. After I grab my cash with both hands and make a stash, I call my lady friends with benefits. All three are middle management and make good money to invest. the forth one has moved to another city to pursue a career advancement but I did not kick her out of the investment club. I more than triple their portfolios annually. Why hobby when these three ladies take good care of their Magic Man. The forth one come to town to see her family 2-3 times a year and also to pamper her Cash Kitty.

Do you write science fiction too?

 

[Ceiling Cat]

Do you write science fiction too?

What part do you not believe? The 25-30 % or the 50+% gain?

 

[fall]

What part do you not believe? The 25-30 % or the 50+% gain?

The "can" part. I may believe in your past realized returns, especially if you invested in stocks with large betas and it was so happened that the market grew a lot. But you make the rookie mistake: you attribute your past gains to your abilities and extrapolate them to the future.

 

[Ceiling Cat]

The "can" part. I may believe in your past realized returns, especially if you invested in stocks with large betas and it was so happened that the market grew a lot. But you make the rookie mistake: you attribute your past gains to your abilities and extrapolate them to the future.

You are assuming much, to say that I merely pick stocks with a high βeta ( volatility ) is to over simplify the situation. If it were that easy then all you have to do is look up a few stocks with high betas then profit is assured. A great many ingredients go into a perfect storm to make things happen. I have written a stock picking program using my own algorithm to identify conditions to know the direction a stock is going. I make my choice backed with facts and probability, not merely on speculation. Not only is it necessary to identify a good stock, you have to know when to buy and when to sell. You also have to do your assessment quickly so that you can act on the information. My stock program gives me that ability.

To assume that I have made money on stocks solely because the market was rising is to have a grossly over optimistic pie in the sky thinking. Have you picked stocks week after week with 25-30 % or the 50+% gains? It is not an easy task. My guess is that the stock market will slow for the next 6 to 9 months before it will rise slowly. I may make less profit in the future, my strategy and methods will work as well and returns proportionate to market conditions.

Even a 10% monthly gain is better than the average stock market investor can achieve. If the monthly gain is re-invested, your money is tripled in 12 months. The returns on my stock picks are diminishing and getting closer and closer to that 10% / month benchmark. I must have the discipline to step away and wait for better conditions. Which I have done since the end of August. There are storm clouds on the horizon, to be followed by a new dawn.

 

[Goodoer]

I'm a buyer. I wish I had even more money to invest.