Investment BS Thread - Stocks/Futures/Mutual Funds/Bonds/Commodities/Options/ETFs/401ks/Etc

The stock market will continue to go down. AAPL is simply a foreshadowing of what's to come. Tim Cook has zero innovative ideas and instead relies on constant phone upgrades and "dongles" to create a captive market and pad margins. Meanwhile, discount phone mfrs like huawei are lurking in the shadows, and the American market is ripe for the taking. This is what happens in a mature market.


Add on top of that the long ignored interest rate hikes finally taking effect on the markets (usually takes about a year for markets to adjust to hikes, 2+ years is a record breaker), a myriad of other data coming in (housing, foreign economies, consumer sentiment) all teetering and declining - the US is beginning to feel the shakeup that's been happening in many other foreign markets, just look at China or France. While the economy is still strong, the free money flow has stopped, and businesses have to take a hard look at their fundamentals (you know, that thing that has been largely ignored during ZIRP). Interest rates have skyrocketed for junk rated corporate bonds, all of the sudden people want more yield for the risks they are taking, or they are heading out the door and are causing corporate bonds to unwind. I'll continue to hold off, I would make some bear plays but with this volatility, I could go without more hair loss!

 

Good jobs data and a dovish Powell have certainly injected some adrenaline into the markets today!

 

Yea the FED is in a pickle.

On one hand, they are afraid to raise the Federal Funds Rate (FFR) because that can easily spook people/investors if they do it too aggressively.

On the other hand, they know a recession is coming. The want to raise rates now, gradually, before the recession hits. It typically takes lowering the FFR about 4% to get out of a recession. The FFR is currently about 2.5%, a long way off to get to that 4%. They have been raising it 25 basis points (.25%) every quarter for a couple years now.

Seeing how shaky things are now, they may not be able to get the FFR to 4% before the next serious crash/correction.

 

I think they’re on pace to get there. Isn’t there a somewhat long amount of time after the yield curve inverts until a recession starts (18 months or something like that)? I think we have some time still, the curve hasn’t inverted yet.

 

Yea you are right, there usually is a lag, and I’m hoping that IS the case so there is more time to be proactive rather than reactive.

I’m wondering if this time, because of the magnitude, things could develop quickly.

 

I think you’re right, with algorithmic trading it could be different. Faster, maybe, but maybe the sales cancel out the buys and it plays out normally?

Who knows, you’d be getting into trying to time the market, and that will never works. I will hold through whatever happens, as painful as that may be.

 

I think the Fed knows what's happening already and they're already being dovish. But then again, JP seems to do what he wants. Will his words mean anything in a month or two? Who the hell knows. I have a feeling he will stick with two rate hikes in 2019 as planned. These are the slowest rate hikes in history, and it might actually work. We will see.

 

Where are we going next week. I say were down 2% for the week by the end of friday.

 

I say another dumpster fire since that seems to be the trend.

 

Up 1.8% but all over the place along the way.

 

I also think itll be all over the place at least it has been alot recently. The CEO of apple will probably find a nickel in his couch cushion and sp500 will go up 17% on monday.

 

Your guess of down 2% and my guess of up 1.8% have about the same likelihood of happening. It’s a shitshow.

 

Probably about to sell HTZ. That’s a 12% increase in a week

So far so good. Knowing my luck as soon as I sale it goes back up around $18 from its current under $15 price. Oh well can’t be greedy.

Plus I wanna increase my position in ford next drop.

 

okay maybe NOW oil has found a bottom.

 

Ok, I've been lurking in this thread for a bit and you guys have finally got me convinced now is the time to start up the Roth IRA I have been telling myself I should have (any time should have been a good time to start, just so happens I have been bored at work and finally took the time to do some research and open the account). I am going the Roth route as I already have a 401k through work and the idea of tax free income to supplement my other retirement plans in the future is appealing. Our 401k has a pretty limited choice of funds to invest in so I feel like jumping into the wild west of the open market is going to carry a bit of a learning curve. I think I've done pretty ok for myself with my 401k hovering around double digit returns over the last 3 years even after the dumpster fire of 2018.

I don't plan to invest whole lot of cash off the bat so I am trying to decide what direction would be best for me to go with this new account. Either just buy a small number of shares in 1 or 2 ETFs to spread the investment across a little more of the market and let it go to work or buy a larger number of shares of a few low cost stocks and see if I can make a little money to reinvest and continue playing. I really just want to get a little experience and feel confidant that I'm not going to lose cash that could be put to better use as I continue to save and add to the account.

Any thoughts or suggestions for someone just trying to learn the market?

 

Depends on the ETF but I would check it for fees. Some of them will get you. Some will make periodic "adjustments" that may not benefit you. Just have to do your due diligence.

 

If you want to just ride the market up this year (which is where I think it is headed), and get a decent dividend at the moment, I’d throw it all into SPY or VOO.

 

If you’re going for a simple set it and forget it type investment just put it all in a low cost index fund that tracks the S&P500. You won’t get killed on fees, it won’t be as volatile as individual stocks can be, and it’ll net a good (7-8%) but not exceptional long term rate of return.

If you want to mess around trying to pick individual stocks, dabble in options, or anything else I would say only do that once you’ve fully maxed out your tax advantaged account contributions and only do it with money you’re okay losing.

 

and now i'm wishing i wouldve invested into ford when i said i would... oh well