Back of a fag packet job.
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It’s all in the game yo, all in the game
The year to date low was on August 24 pal, something even a casual observer of the market should know. I didn’t call a top or bottom on Sept 20, I opined that this was not a good time to be invested in equities or high yield credit. The only top that matters to me personally is when I exited long equity positions in Q2 when it was clear that US markets had topped. The S&P may be up 6% since Sept 30 (not 9%) but is still roughly 5% down from the mid summer high and more importantly has not regained its 200day MA. If this were a normal correction the 200 day should have been reclaimed by now.
The reason this isn’t a normal correction and is the early stages of a bear market is that we are now in an earnings recession in the US. This week will provide further clarity, but even the greatly reduced lowball targets set by institutional investors are not being met. The strong dollar and global weakness is starting to take its toll, first on revenue and then earnings (look at IBM today).
You are correct about central bankers and the hope of further easing, that’s the hope that continues to prop up this market, but you know what they say about hope as a strategy. Eventually stock markets reflect fundamentals of the underlying securities and I’m afraid the fundamentals are not good and getting worse. The Fed has a history of eventually fucking things up, this time will not be different.
Retail investors tend to be buy and hold or have their money in managed accounts which is also largely buy and hold. They are always the ones burned in bear markets as they convince themselves or are convinced by others to stay in until they finally cave and sell at the bottom. Institutional investors sell near the top, short the market, and then buy back in near the bottom. They are the ones who control markets after all. I personally don’t try and time the market generally but follow Mebane Faber’s strategy of a broadly diversified portfolio and go to cash on assets that drop below their 200 day MA. The backtested returns are better than average with significantly less drawdown.
I agree you cant generally predict market direction short term. Just as in bull markets in bear markets you get short term rallies and fades, like we are seeing now. We will see who is right in the coming weeks and months. I am predicting a new low by the end of October due to weak US corporate results, a rally towards the end of the year and a very difficult 2016.
Shorten your paragraphs.
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This is your post from August 24th.
I was quoting performance since September 20th as is clear in the post.
I could expand this into a wider debate about “chartists” but I don’t have the energy.
I’m not going to go through the rest of it. I agree with a lot of what you say. You seriously overstate the intelligence of “Institutional Investors” though the vast majority of them under perform the market. Also a buy and hold strategy outperforms nearly all others once what you are buying is something like an S&P ETF.
You’re all over the shop. In your earlier post you were referencing a response of mine to Fitzy from September 30th (not 20th, the last near term bottom was Sept 28th, and the day after my post was Oct 1), and now you want to move the goalposts to August 24. All I said on August 24th was that imo this wasn’t the bottom of this cycle, I still think that’s the case but we will see.
It’s not so much the intelligence of institutional investors, its their ability to move markets due to their size. In particular as they appear to collaborate, as in the recent FX price fixing, which is unlikely to be in isolation.
I’ll make it very simple here mate.
- Since you have said this markets have rallied strongly.
- You said this at the lowest point of the market.
Anyway. That’s enough of that.
What’s your favourite stock these days?
Knorr.
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Fair enough.
I don’t buy individual stocks but I think TSLA is oversold.
Marco Pierre O’Dowd
Don’t believe in individual stocks myself, if I had to buy something to hold it’d probably be Facebook. Thought it was just a gimmick at the start but they are really producing the numbers now.
Be a volatile one, but I think they are the new Google. FB users spend something like 30mins on average a day on the site. Phenomenal.
Bono owns 2% of Facebook I think. Worth a billion or so.
I think Facebook is overdone and will decline significantly in the next 2/3 years.
They are starting to get the ad money rolling. They have all your info, your preferences, all those things retards sign into with their facebook accounts. They can put very specific adds to you and as such charge a premium per click
I do not have a Facebook account.
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You’re not missing much.
Yes but I don’t think they are going to maintain market share. The next generation are already ignoring facebook and moving to less public networks. Although Facebook the company as opposed to the platform will probably just buy up all these emerging networks.
Of all the big players I would see Amazon as the one with the most potential over the medium term. Aliexpress looks well placed to be a capable compeditor in some of the markets but amazons play in the media and web servcie space looks like its capable of huge growth.
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Amazon prime you mean? I’m not so sure they’ll make much inroads there taking on netflix in that particular niche area.
Is there a TFK stock option?
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