Of course I disagree with you.Originally Posted by Guisslapp
It’s all Trump policies and the Good Lord which have our economy humming!
|
|
|
|
|
Of course I disagree with you.
It’s all Trump policies and the Good Lord which have our economy humming!
You interested in buying 10 year treasuries that pay 1.82%?
You typically by treasures? 🤪
Very little, but I am not old. Still, in the US alone, the bond market is twice as big as the stock market. Daily trading volumes in bonds is over 3 times that of the stock market.
As anyone should know, governments outside the US have issued lots of debt at NEGATIVE rates, which has caused foreigners to shift a greater percentage of their fixed income investment into US sovereign debt that actually pays a positive return. This has made the yield rate of longer term US debt to go down.
Most folks can’t get the yields they need from the fixed income part of their portfolio by buying new debt, so it is pushing more people out on the risk curve to get yield, including bond proxy investments like dividend stocks, utilities, REITs and the like.
Not making this stuff up.
Look at the fact that the average P/E for stocks have gone up dramatically over the past 2 years, the relative performance of utilities, the past examples of interest rate sensitivity to the market (remember the sudden sell off in December 2018 when the fed increased rates).
https://www.investopedia.com/ask/ans...ock-market.asp
Rates won’t stay this low forever. At some point that will change, and it will take the air out of the stock market. We are paying well above the average price for corporate earnings today.
https://www.google.com/amp/s/www.bar...ue-51578786380
Stocks are expensive–and extremely so—based on several measures. The S&P 500 is trading for almost 19 times projected 2020 earnings, one of the highest readings in more than 40 years. Stocks also look rich based on market value/gross domestic product, price/sales, and price/book ratios.
But they do look fairly valued based on the rule of 20, which reflects the market price/earnings ratio and the inflation rate. If the sum of the two is below 20, stocks look cheap. Above 20, they’re expensive. Right now, the total is around 20. Stocks are appealing based on the earnings yield (the inverse of the P/E ratio) less the yield on the 10-year Treasury.
I have started selling off my stock holdings. At this point in my life, semi-retired and set, I am more into asset protection than concerned about growth. I don't follow the market as closely as I used to, but I did tune into CNBC and watched the pundits some last week. There is still support for the notion the market has more room for upward movement and that the economics of it all is very strong. Caveat emptor.
I do know our economy is strong with more room to grow...if Congress and the Swamp would ever either, join in and participate with our great Prez, or just get the hell out of the way!
The stock market goes up 85 percent of the time. With all the algos, corrections are usually sharp and can be harsh.
There is an old trading adage, “don’t fight the Fed.” For those that follow markets closely, you know that is never more true than now.
In my estimation (and I am not a professional, so caveat emptor as well), the market is largely fully valued and if earnings and guidance don’t meet or exceed expectations the risk is to the downside in the short term. Plus on a RSI basis the market is in overbought territory.
It can stay like this for a while and prices can continue to melt up. But it isn’t really doing it for reasons that are based purely on fundamentals. There does seem to be a growing consensus that the global downturn is bottoming. I hear talk of “green shoots” starting to show in Europe and Emerging Markets.
Still, US manufacturing is weak and the strength of the US economy has been and still is the consumer. If that shows signs of cracks, look out below.
On the plus side, the US still leads the world in Technology, but this industry seem to be hated by Republicans and Democrats alike (at least the populists).
Personally, I don’t really like it when the market is going up because of expansion of P/E multiples. I don’t like having to pay more for the same earnings. I would rather the market go up because companies are actually earning more. That is a much more sustainable basis for appreciation.
WTG TRUMP!
US, China sign historic phase one trade deal
The "Melt Up" theory. Perhaps you've seen Dr. Steve Sjuggerud's offerings for financial advice. I have never subscribed to his stock market newsletter but am on his email marketing list, probably because of my past affiliations with the likes of Motley Fools. Anyway, since the middle of last year, while others preach caution in investing in the market...the big correction to come!...Sjuggerud has been advocating for more bull market yet to come. Thus instead of an economic "melt down" he predicts a "melt up." I finally got curious enough to accept his 30-day free trial and have read some of his stuff. Very interesting. His writings are full of stats and numbers and sound financial/economic theories to lend credence to his overall theory that the market has plenty of room to grow. Mostly, a lot hinges on Trump being reelected and not only continuing his policies, but extending them.
I agree Trump's policies, with a cooperative Congress and a constrained judiciary, will have a HUGE positive impact on the economy and it follows that the stock market would benefit. But, there's more to the market than fundamentals. A shooting war starting in East Bofunk province of the country of Whazdaheckstan causes nervousness and a sell-off in the market. Still, sound economic policies does clear the path for more bullishness in the market.
Vote Trump in 2020! (if you care about your own, and the nation's financial future)
I agree 100%. And though we can't rest, Trump is smoking hot with his base and Independents right now with no end in sight.
Trump’s New Hampshire vote dwarfs tallies of past incumbents Obama, Bush
Trump has thus far been an awesome POTUS. There are a few things I disagree with him on, but for the most part he has brought the country back from the brink of malaise and decline.
That said, I hope he listens to Barr and limits his tweeting. I have no issues with him rattling the cages of the dem candidates and those in congress that are as corrupt as the day is long, but he really needs to stop undercutting the folks HE appointed while they try to do their jobs. If he has an issue with them, he can always fire them and replace them with someone else, so all the tweets are kind of over the top.
I agree. Sometimes Trump would be better off if he would just STFU. It gets tiring really. Just act like a freaking mature adult every now and then.
I agree and have stated similar.
I enjoy reading what he’s thinking but come on man! Just keep doing the great job you are for America.
Sometimes I wonder if this is his way to do 4D chess. Think about this for a second... MSM and Democrats were screeching that Barr is just an extension of Trump and not impartial part of DOJ. He is doing Trump's will. They are now praising Barr because of course Orange Man Bad.. and Barr said what he did on ABC yesterday about Trump's tweets.. So now Barr has credibility in eyes of MSM. When Durham's indictments come out and snag some prominent democrats they will be reminded of their positions.
I'd like to think that, but.....I really think this is all impulsive tweeting.
He needs to stop attacking Jerome Powell as well. Everytime he calls for negative interest rates I cringe!
The guy is doing great stuff for the nation. I'd hate to see him lose because of dumb stuff like that.
Posting Permissions
Reply With Quote
