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Dow Hits 20000 for First Time

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Re: Dow Hits 20000 for First Time

#171

Post by danans »

jcfrei wrote: post #154
xigency wrote: post #71

I understand that people believe Trump is good for business. And I also understand that people believe Trump is good for the rich. And I also understand that people believe Trump is good for the blue-collar worker. But I don't understand how Trump could be a good influence, in the long term, on business and the stock market, when looking at his positions and policy changes. Why Trump isn't good for poor working class…

I have this - admittedly very condescending - theory that a large part of the middle class is still "financially illiterate". Wages are hardly ever discounted for inflation and thus growing wages (in absolute terms) make most people happy. Even if their purchasing power is declining. As long as there is no sharp increase in prices most people won't complain.

Money illusion is well a known theory, first proposed in 1928, and backed by empirical evidence from behavioral economics: https://en.wikipedia.org/wiki/Money_illusion

Re: Dow Hits 20000 for First Time

#172

Post by smileysteve »

cryptoz wrote: post #80
nrjdhsbsid wrote: post #18

Trump for all his craziness is vehemently pro business. I know the whole tech crowd wants him to crash and burn but the stock market rising is no surprise to me. Whether it's worth the damage done to the poor and the environment is yet to be seen.

> Trump for all his craziness is vehemently pro business. No he is definitely not. Trump is anti-business and he makes that very clear. His campaign promises and actions since election are super clear that he is pro-his-wealth and not pro-business. A pro-business politician would raise taxes on the wealthy, provide tax cuts for the middle class, increase the corporate tax rate, improve immigration so that more people…

> increase the corporate tax rate,

A number of economists disagree with you.

* Opaque

* Consumer paid

* Subject to Perversion through Deductions / Inversions

https://www.nytimes.com/2014/01/06/opinion/abolish-the-corpo...

Re: Dow Hits 20000 for First Time

#173

Post by acchow »

i_cant_speel wrote: post #147
bamdadd wrote: post #58

Listen to this episode of Planet money in 2013: Despite all the celebration, the Dow Jones industrial average has not hit record highs recently. If you adjust for inflation, the highs just aren't as high as they seem. And even if it does hit a real, inflation-adjusted high in the next few weeks, it won't mean much. The Dow is a seriously flawed stock index, and it's certainly not a good way to measure what's going on…

I listened to that podcast when it got rebroadcasted. Even the people who are in charge of the Dow admit it's not a great tool for measuring the economy. They don't change it because the only thing it has going for it is the fact that the algorithm has been around for over a century. If they changed it, they wouldn't gain much and they would lose the only thing it has going for it, which is its standing as the oldest…

Also, the stock market isn't the economy.

Re: Dow Hits 20000 for First Time

#174

Post by smileysteve »

thebiglebrewski wrote: post #51

If you had a bunch of money to put in the stock market, would you: - Put 1/3 of it in now and the other 2/3 in when the next crash hits - Wait until it all goes to shit and put it all in then, keeping it in a high-yield savings account until then (they make about as much as CDs these days) Would love to hear opinions!

You Should Really Read This. "What If You Only Invested at Market Peaks" https://news.ycombinator.com/item?id=8210923

Re: Dow Hits 20000 for First Time

#175

Post by loafa »

jknoepfler wrote: post #34
nugget wrote: post #13

Remember when nearly the entire business media predicted that if Trump was elected the stock market would crash immediately? Some of my smartest friends (at hedge funds) placed large bets mid to late 2016 that the market would decline. Now here we are. The lesson isn't that Trump is awesome for the economy (maybe he is, maybe he isn't) or that the market won't crash tomorrow (maybe it will, maybe it won't) but rather…

And here we are, invested in index funds, outperforming the hedge funds again...

Hedging is about protecting your downside. 100% long funds like your index fund may do well in a rising market, but when the market declines you may find yourself wishing you had a hedge fund instead.

Re: Dow Hits 20000 for First Time

#176

Post by big_youth »

harryjo wrote: post #64
jjawssd wrote: post #53

Earlier quoted context omitted.

Fine, but what if there is a chance that the huge heap of regulations supporting entrenched interests is broken up? I'm looking at you Comcast

Let's see which regulations get cut first. So far, it's not the government contracting regulations. Bonus: when Trump "freezes the size of Federal employment" do you think that will be match by a freeze in contracting, or a boost in crony contracts?

He did put in a provision to prohibit federal agencies from hiring contractors. From the order: "Contracting outside the Government to circumvent the intent of this memorandum shall not be permitted."

I haven't seen a single fake news site report that though, they are all pushing the alternative fact that contractors will be hired en mass.

Re: Dow Hits 20000 for First Time

#177

Post by jakeogh »

crisnoble wrote: post #130
jakeogh wrote: post #128

Earlier quoted context omitted.

"Freezing federal hiring literally will cost jobs" Jobs in government, not in private industry. Would you rather we all go on the gov payroll?

All I was trying to say that the current round of executive actions are being taken for businesses and without regards to effects on workers, but you put it more succinctly.

Businesses would like to make their goods as cheap as possible (by using cheap labor outside the US). What he has proposed (tariffs) forces them to build here, hence the jobs are here.

Re: Dow Hits 20000 for First Time

#178

Post by mooreds »

forgetsusername wrote: post #141
mooreds wrote: post #44

Earlier quoted context omitted.

This! So this! I wish that we could just drop the Dow entirely and focus on the more modern indices like the S&P. I understand it has historic significance, but let the DOW lie.

> I wish that we could just drop the Dow entirely and focus on the more modern indices like the S&P. I don't get it. Is someone forcing "us" to use the DOW in some manner? It is what it is, use the information how you choose. This reminds me of people who complain about how the BLS calculates specific measures of inflation or unemployment. They list their methodology. Either you find the information important and use…

No one is forcing you, but when the cultural zeitgeist is behind it (reported every day in the pop news, especially when rising) it promotes mass financial illiteracy.

I think it's a lost cause, just like the metric system in the USA, but dropping the Dow and focusing on more accurate measures would, in a small way, focus people's attention on more important economic news.

Re: Dow Hits 20000 for First Time

#179

Post by ryandrake »

acchow wrote: post #173
i_cant_speel wrote: post #147

Earlier quoted context omitted.

I listened to that podcast when it got rebroadcasted. Even the people who are in charge of the Dow admit it's not a great tool for measuring the economy. They don't change it because the only thing it has going for it is the fact that the algorithm has been around for over a century. If they changed it, they wouldn't gain much and they would lose the only thing it has going for it, which is its standing as the oldest…

Also, the stock market isn't the economy.

THANK YOU for pointing this out.

The stock market is not the economy. Stocks going up is not objectively good, and stocks going down is not objectively bad. Same for housing prices and cost of living.

When the pie grows, often the result is I have a shrinking portion of it.

Re: Dow Hits 20000 for First Time

#180

Post by rconti »

crisnoble wrote: post #124
rconti wrote: post #120

Earlier quoted context omitted.

All of the pro-manufacturing-in-the-US, anti-import stuff.

I have yet to hear about any movement on those campaign talking points.

Do threats not count as movement? What about threats that inspire (alleged) action? There has been quite a bit of both.

Does it have to be an executive action?

Traditionally, the President wasn't the one creating the laws to begin with. So if Congress passes a law and Trump signs it, is it his action then?

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