Stock Market- Investing

[dawg80]

Appears the last round of stimulus checks spurred many first time market investors. Now, word is more money is expected to flow into the market when the $1,400 checks go out, to the tune of $billions! There were a bunch, tens of thousands of people, who opened investment accounts in the stock market for the first time. Heard something about African American first-time investors...why would anyone give a damn what color skin someone is? I mean someone actually documented...and how, BTW, the race of investors????

Anyway, moving past that stupidity, I have been reading a lot, ya know like from the Motley Fool, and other of those on-line "experts" warning against a market bubble driven by newbie investors inflating the value of many equities and the market in general. Some claim at 30,000+ the market is not there, in the fundamentals...which bears a lot of merit given the STUPID-ASS Biden et al wrecking the US economy...and a major correction is pending.

Comments? Opinions?

I am watching the sectors of 5G, cannabis, lithium batteries/EVs, and of course, the whole energy sector.

[Guisslapp]

1. It is good that retail investors are flocking to the market. Owning a part of business is the best way to grow your wealth.

2. Mixing politics and investing is a surefire way to underperform.

3. Current valuations (even after the 10% “correction” of the NASDAQ) look pretty full to me, reflecting historically low interest rates (even with the recent spike in the 10 year). “Don’t fight the Fed” has once again (so far) proven to be accurate. With cash generated 10 years from now being valued close to the same as cash generated today, growth stocks have done quite well. Plus bonds pay less than the yield on SP500, so TINA (there is no alternative) has helped keep stock valuations at relative highs. Of course, if you are calculating trailing P/Es, they should be high anyway because 2020 is an unusual year.

A greater correction would not surprise me, and if it is triggered by rates, it wouldn’t surprise me to see valuations come in more, particularly in companies that don’t generate earnings today...

4. I have been long 5g and cannabis for a couple of years. Sold my cannabis positions in the recent Reddit fueled rally. Might get back in later. Long EV, but I play it through materials rather than betting on a single or combination of OEMs or technologies. Long energy, particularly green energy. Other major themes for me are AI, quantum computing, cloud, and cybersecurity.

[Guisslapp]

Also, bought Bitcoin, banks and other financials in 2020 to prepare for reopening and inevitable rising rates. Didn’t buy the energy sector, cause I am inherently long due to my job, but that is another way to play reflation. But as they say, the biggest gains come from when things go from frightening to just bad, so energy (and financials) have already rallied significantly.

[dawg80]

Goosey, my man! your best posts are on our topics like this. You should stick to such and steer clear of your political rantings.

I expect a correction some time during 2021. It might occur later...during the summer, maybe?....after all this additional new money has been absorbed and the market settles back to basic fundamentals. Unfortunately, I'm afraid, many of these newbies who helped fuel the bubble will get clobbered in the correction and that will forever sour them on investing.

When the board is RED! I see BUY signals blinking wildly!!!

[DawgyNWindow]

Appears the last round of stimulus checks spurred many first time market investors. Now, word is more money is expected to flow into the market when the $1,400 checks go out, to the tune of $billions! There were a bunch, tens of thousands of people, who opened investment accounts in the stock market for the first time. Heard something about African American first-time investors...why would anyone give a damn what color skin someone is? I mean someone actually documented...and how, BTW, the race of investors????

Anyway, moving past that stupidity, I have been reading a lot, ya know like from the Motley Fool, and other of those on-line "experts" warning against a market bubble driven by newbie investors inflating the value of many equities and the market in general. Some claim at 30,000+ the market is not there, in the fundamentals...which bears a lot of merit given the STUPID-ASS Biden et al wrecking the US economy...and a major correction is pending.

Comments? Opinions?

I am watching the sectors of 5G, cannabis, lithium batteries/EVs, and of course, the whole energy sector.

Well, if new AA investors get in at the top of a bubble and lose a lot of principal, our resident liberals will be on here complaining that the market is racist and SOME who lost money should be reimbursed with government debt while the financial markets take on more and more regulations. So the color of the investor really matters (to some).

I keep thinking that utilities will have to benefit from any EV usage explosion, as they are not only going to be selling more power but will likely get a lot of government cheese for setting up infrastructure to service these vehicles. Seems logical to me, so I suspect the utility stocks will continue to underperform.

[Guisslapp]

At least with utilities you get better yields during underperformance, and I agree that they should benefit from electrification and investments in the grid (since outside of Texas utilities get to pass the costs on in rates at a known ROE).

[dawg80]

Got a newsletter, one of those "dime a dozen" type of marketing emails designed to elicit a subscription. You know the types. But it also included a brief article stating that a rise in interest rates will be good for the stock market. I did not subscribe so don't know what they propose as an argument, but I don't think rising interest rates will drive the market higher. In fact, it should have the opposite effect.

1. Rising rates increases the cost of money impacting companies' cash flow, etc.. and also discouraging expansion, hiring, R&D, etc...

2. Rising rates will also make alternative investment products more attractive, even CDs and other safe vehicles, thus siphoning off dollars that would have otherwise been invested in equities.

But, I am always open to learn more. So, does anyone have an explanation that supports this notion?

[Guisslapp]

I don’t know that rising rates cause stocks to go up, but they can go up at the same time when the reason that rates are going up is because of the expectations of real growth.

[Bulldog Tom]

Appears the last round of stimulus checks spurred many first time market investors. Now, word is more money is expected to flow into the market when the $1,400 checks go out, to the tune of $billions! There were a bunch, tens of thousands of people, who opened investment accounts in the stock market for the first time. Heard something about African American first-time investors...why would anyone give a damn what color skin someone is? I mean someone actually documented...and how, BTW, the race of investors????

Anyway, moving past that stupidity, I have been reading a lot, ya know like from the Motley Fool, and other of those on-line "experts" warning against a market bubble driven by newbie investors inflating the value of many equities and the market in general. Some claim at 30,000+ the market is not there, in the fundamentals...which bears a lot of merit given the STUPID-ASS Biden et al wrecking the US economy...and a major correction is pending.

Comments? Opinions?

I am watching the sectors of 5G, cannabis, lithium batteries/EVs, and of course, the whole energy sector.

Lots of newbies in Game Stop. Lots of stimulus money spent on life insurance. Economists didn't see that one coming.

[DawgyNWindow]

I'll take a 3 1/2 to 4% CD over the possibility of making 7% in the market (assuming I make the proper choices). The reduction of risk is worth the possible 3 percentage points earned on my money.

[Guisslapp]

I'll take a 3 1/2 to 4% CD over the possibility of making 7% in the market (assuming I make the proper choices). The reduction of risk is worth the possible 3 percentage points earned on my money.

Where you finding that CD rate?

[DawgyNWindow]

Where you finding that CD rate?

I wish.

The conversation was about higher interest rates being good for the stock market, and my point was that my appetite for risk pretty much goes away as soon as guaranteed income reaches about 50% of what I can expect with a riskier portfolio.

Gimme 3 1/2 percent and I am pretty much out of stocks entirely....I like to sleep well at night. Didn't lose a penny from the dot-com bust when that happened, but did work with a lot of previously retired folks that had to return to work because they lost all their savings.

[dawg80]

I'm at the point in my "investing life" where asset protection > asset growth. Yeah, I will always have some "play money" to put in the stock market because I enjoy "the hunt!" Doing research on start-up companies in new industries and getting lucky enough to buy 1,000 shares of some penny stock that jumps up nicely...cha ching! It's like winning a round of golf from friends. I call my money invested in TD Ameritrade and E Trade accounts my "monopoly money." It is also true I have a group of blue chip dividend payers that are steadily growing my kitty, but it's the speculative equities I enjoy the most.

I would buy CDs if they were returning 3% or so. I am in the process of liquidating physical assets I hold, including real estate properties, and all that is doing is swelling my cash position in chunks of $hundreds of thousands at a time. Would like to channel a lot of that into some safe harbor that actually pays something.

[dawg80]

Speaking of speculative equities...if any of you wish to share some ticker symbols to watch I'd be interested. I'll start with one I recommend you do some DD on:

Comstock Mining, Co. symbol LODE. It's a gold/silver mining venture that owns the famous Comstock silver mine. The mine that made Randolph Hearst rich! thanks to his father's mining efforts. In the late 19th Century gold was the rage out west and some fellow discovered gold near Virginia City, Nevada...on the lands of the TV show Bonanza, The Ponderosa. The miners complained about the thick, stupid "gray mud" that made gold mining difficult. George Hearst, a mining engineer, went to the mine and discovered the "gray mud" was in fact silver! He bought the failing gold mine for pennies on the dollar and got RICH! mining the silver.

That's the history part. Today Comstock Mining is generating a steady income mining the silver, and also many ounces of gold when a vein is found. But, Comstock Mining also just bought a 62% controlling interest in Linico, a lithium battery recycling company. Nevada is the only state that has licensed lithium reclamation and lithium battery recycling. And, the Linico facility is close to a Tesla plant...hello!

Anyway, check out LODE.

[dawg80]

Also check out VUZI. It's been a volatile stock so if you're a day trader or willing to do some short term buying/selling this could work well for you. But, I also recommend you consider a long term position given the technology they hold patents on.

Of course, with all such "recommendations" do your own DD. There is no crystal ball and even stock brokers are really clueless, as Mathew Mac's character in The Wolf of Wall Street said. It's a forgazi...pixie dust.