Anybody Buying Yet? Where’s the Bottom?
- Thread starter NEWHunter
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SAJ-99
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Bear market rally? I guess. I doubt we see new all-time highs again for a while, so this would meet the definition. I expect a lot of back and forth, with the market going a farther than pros expect in both directions. New lows? Pretty solid floor around 3600, but when it makes a run hard to say where it stops.
None of this pattern stops until it looks like the Fed is done with rates. Companies are preemptively laying off in anticipation of tighter financial conditions. That might cause a recession. After all, if we stop spending because we are concerned about a recession we actually cause the recession due to the reflective function.
On the positive, Earning have held up and there is a huge speculative short position, which become buyers in covering at some price level.
HONEYBADGER
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Big tech is waiting until after midterms to make big cuts. Google has already said there will be blood in the streets and Motorola has been talking about the coming RIF for months. December will be bad.
Feel the squeeze. Earnings are ripe especially as the semiconductor world starts reviving from autos rolling off assembly lines to computer AI. Semiconductor realm of ETFs for the safer side and options for the risk / reward - strangles n straddles.
Irrelevant
Well-known member
ya'll made me look.
... yep, still down.
... yep, still down.
mallardman10
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I’m buying on others fears
SAJ-99
Well-known member
Yeah , some of the profit/rev warnings from chip makers seem a little odd, like trying to set the bar as low as possible.
Rough day today, but not unexpected given Monday after Friday expiration. The quarterly expiration in September will be very interesting. Right now we just look to chop within a range, unless someone says something stupid at Jackson Hole.
noharleyyet
Well-known member
Why in Jackson Hole?
The Federal Reserve’s outpost in Kansas City originally conceived the event in 1978 as a forum to discuss agricultural trade. But over the following years, the Kansas City Fed made efforts to broaden out the scope of the conference to general policy matters.
In 1982, the Kansas City Fed sought to pick a venue that would fish Fed Chairman Paul Volcker out of his base in Washington, D.C.
Knowing that Volcker enjoyed fly fishing, the Kansas City Fed originally sought to hold the event in Colorado, but the timing of August led them to pick a location farther north: Jackson Hole, Wyoming.
The event has been consistently held there since, although the COVID-19 pandemic forced the event into a virtual format in 2020 and then again in 2021.
When held in-person, protestors will often travel to Jackson — known for its massive inequality gap — and organize near the lodge. Groups like the Fed Up Campaign and 350.org have called on the Fed to pay more mind to policies that impact marginalized communities and climate financing.
The Federal Reserve’s outpost in Kansas City originally conceived the event in 1978 as a forum to discuss agricultural trade. But over the following years, the Kansas City Fed made efforts to broaden out the scope of the conference to general policy matters.
In 1982, the Kansas City Fed sought to pick a venue that would fish Fed Chairman Paul Volcker out of his base in Washington, D.C.
Knowing that Volcker enjoyed fly fishing, the Kansas City Fed originally sought to hold the event in Colorado, but the timing of August led them to pick a location farther north: Jackson Hole, Wyoming.
The event has been consistently held there since, although the COVID-19 pandemic forced the event into a virtual format in 2020 and then again in 2021.
When held in-person, protestors will often travel to Jackson — known for its massive inequality gap — and organize near the lodge. Groups like the Fed Up Campaign and 350.org have called on the Fed to pay more mind to policies that impact marginalized communities and climate financing.
mallardman10
Member
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- Aug 19, 2022
- Messages
- 20
I’d take the over on lots of stupid things said at Jackson hole!
SAJ-99
Well-known member
Let me be clear, by Stupid I mean things the market doesn’t expect, not things Average Joe doesn’t understand. Right now the market is pretty open to a lot of views. It would be extremely hard to surprise it. However, the market creates volatility when it wants and the narrative follows.
Do you understand what the theory of Rational Expectations is?
SAJ-99
Well-known member
Yep. A lot of Economics is based on it. But it’s BS. We are not always rational.
Do you have a point?
I always appreciate your financial perspective though, "BS" is extreme, IMO.
Macroeconomics are practiced worldwide.
Examples such as: Inflation, unemployment levels, national income, GDP, interest rates, etc - all considered, "macroeconomic" by definition.
Macroeconomics is based on the "theory of rational expectations". A few credits were gained studying the various global economic theories.
I believe volitility is merely one aspect of the rollercoaster ride when viewed from a short term perspective. Overall, it forms a common theme, in the grand scheme. It's fitting considering the topic... Least from one person's perspective.
Macroeconomics are practiced worldwide.
Examples such as: Inflation, unemployment levels, national income, GDP, interest rates, etc - all considered, "macroeconomic" by definition.
Macroeconomics is based on the "theory of rational expectations". A few credits were gained studying the various global economic theories.
I believe volitility is merely one aspect of the rollercoaster ride when viewed from a short term perspective. Overall, it forms a common theme, in the grand scheme. It's fitting considering the topic... Least from one person's perspective.
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SAJ-99
Well-known member
Agree. It was more tongue-in-cheek. All Econ theories are half BS. It’s called the dismal science after all. I actually think there is a lot of support for it in markets, where the collective actions of participants is what makes a market. For example If we expect volatility, we can get volatility. In terms of macroeconomics, it fits well with inflation theories. Other things it doesn’t work so well on, like driving GDP or internet rates. A macro economy it very dynamic, and just what we “expect” isn’t enough. Sometimes we may say we rationale expect one thing and then irrationally do something else.
noharleyyet
Well-known member
My FA never uses the word dismal, except for adjectives describing his competitors...
You clearly don't have a clue what the theory of rational expectations is. It says, prices today reflect all the information that market participants have available at this very moment. And prices will only move (presumably around a median) either up or down as new information is disseminated to the market place. It says nothing about how much market participant opinions can vary or how wide that dispersion of opinions is. It just says that prices today reflect everything investors know.
I believe what you are saying is: market expectations don't have to be correct. Rational Expectations says nothing about that. As new information comes out, prices MAY move. That's it. Most people read way too much into it, and come up with their own interpretation. There is "nothing to work or not work". Prices in all cases reflect what market participants know today. That's it.
And any market, be it housing or widgets or whatever "doesn't create volatility". New information can come out to make market participants to buy or sell, and there can be quite a bit of change in individual market participant expectations. THAT is the volatility that you see. People can see and interpret different data. A dear friend of mine tells me this story of a govt trader at a major bank that was sitting at the desk grumbling and shouting "THIS STUPID MARKET, THIS STUPID MARKET". Gary laughed, you arrogant bastard. The market is moving against you and that's why you are saying this. You arrogantly think "by God, the market doesn't know what I know, cause I'm the world's smartest man!!". Oh really. Maybe the market knows something you don't know. And prices reflect that. Trading/portfolio management is a very humbling career, and highly stressful if you have to do it for a living. It's kinda like a commission-only sales job, in that you eat what you kill. You have to have strong opinions but also use the top part of the phone. I always quote Clint Eastwood: A man has to know his limitations. It is such a telling quip.
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SAJ-99
Well-known member
Not exactly. You have moved to debate the various efficient market forms, which is related to rational expectations, but not the same. You made the point that it is mostly about expectations. The market prices in expectations of the future. The future is never known. As long as those expectations are balanced (some think good future, some thinking bad future) and unpredictable you have a pretty good estimate (wisdom of the crowd, or something). But when everyone think the same thing, we have problems. That is what I mean by “creates volatility”, and it only relates to capital markets, certainly not real estate. It plants the seed for a small piece of new information to have a disproportionate impact on prices. This explains a lot of the last 8 months.
Wont respond the “don’t have a clue” post because I don’t feel it is necessary at this point.
We agree that markets are humbling.
L
longbow51
Guest
Anyone have a guess on what the iBond rates will be in Nov?
