Posted on 02/08/2018 2:12:16 PM PST by CincyRichieRich
Or rather, there are rational and irrational components to the movement of markets (as well as intentional manipulation of expectations).
Rational judgment of expectation goes some way to explaining market movements, but you can't ignore irrational surges and slumps.
That stopped almost two years ago. Something else is causing it.
Pretty good analysis.................
That was only the dow. There are other markets than simply the dow.
But, as a whole. Have the fundamentals really changed? We still have massive debt, that's increasing. Bonds are looking more attractive. Easy money at first, so it was easy to make some money. People still can't find[or look] jobs to pay back their student loans. Innovation and tech is/will replace 'menial' jobs every year. Throw in natural disasters left and right.
People are not heeding the words of Gordon Gekko:
“The public’s out there throwing darts at a board, sport. I don’t throw darts at a board – I bet on sure things.”
Gordon cheated with inside information, but he is right about the dart throwing. The little guys in the stock market should probably stick with the tried and true since the big guys can make the market go up and down all the time. For example, I bought some Chevron stock when price dropped this week. I am confident that Chevron is a sound company and its share price will increase over time.
Would it be a good idea to try to stop someone from throwing up when they're in the middle of doing it? It's a bit similar. Let the market finish tossing its cookies, sleep it off, and get back to work.
There is upwards of 8000 points on the Dow of pure vapor in the market, IMHO. That came from the free money (vapor paper) from the QE years of brocko and yellen. It is Dow value that is based on nothing substantial, and, like air in a water hose, has to be bled off.
If Powell were to follow suit, he would take the microphone and announce an interest rate cut just like brocko/yellen did every time the market tried to correct.
This is healthy. You only lose money if you sell. If you're about to retire and are risk-averse, go ahead and cut your losses. If you're 10 years or more from retirement, ride it out and you'll recoup after a while.
Government deficits absorb capital that have its highest and best use in the private sector, not the government sector.
It’s not gambling....at all.
Stocks really took off when Trump won in anticipation of the tax cuts and less regulation. I’m no expert, but it seems to me there was a big psychological component to this rise. Do the fundamentals of the underlying businesses making up the indexes support these stock prices? I’ve been wondering about that for a while. If not, at some point a drop would be inevitable. It seems to me it takes time for businesses to truly improve after years of slow growth under Obama, so the market probably got ahead of itself.
Maybe now that the tax cuts have been passed the anticipation is over and investors and companies are looking at the bottom line.
Unless the cause a huge oil spill or social event.
POLL: What is happening to the stock market?
It is being deliberately sabotaged
It is experiencing a long overdue correction
The Trump economy is crashing
I’m not sure
http://www.headlineoftheday.com
And none of those notes are selling any more. Not the 3 years, not the 10 years.
PRECISELY. ITA.
If you're making a rational judgment about long-term growth potential, that's one thing, but day to day fluctuations don't always yield to rational expectations.
The Dow was in the 700’s back in the 70’s when I got in. Plenty of ups and downs but has always gone up over time. Hang in there.
Well I disagree....but that's how it goes....
Although I do have a question or two....what is long term to you?
And what is short term to you?
So...you think long term investing is or isn't gambling?? I am confused.........
investing is neither irrational nor gambling. Trading on the other hand is.
To suck people in, that’s the Soros’ move.......
Ask not what makes the market move. Ask whether you are flexible enough to trade in the same direction the market wants to move.
******************
WINNER.
Ditto that - CVX (Chevron) is a great company. I bought when the Divvy was 5+% (somewhere in the 70s, thank God). Lot lower Div than that now, but oil is probably never going to go away and the income stream is too tempting to pass up.
I’ve been increasing my Divvy paying stocks, and TRYING to not pay attention to the share price.
Other great picks (IMHO) are HCN, O, F, VZ, T, CTL.
Reap those dividends. Just don’t ever sell the shares and all is good.
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