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Trading halted as U.S. stocks plummet

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Re: Trading halted as U.S. stocks plummet

#71

Post by prmph »

rtkwe wrote: post #49
aguyfromnb wrote: post #24

Earlier quoted context omitted.

> Either they are an indicator or they aren't. Because after the inversion the market (and Fed) reacted? No indicator is infallible or static.

I've been skeptical of the whole yield curve as metric thing because it's not directly tied to the actual state of the economy directly just to the sentiment about the market X years in the future. Given how much we know the whole market is prone to group think, self delusion, and outright manipulation I've grown very skeptical of any indicator about the market that comes directly from the market.

But the actual economy _is_ still about sentiment, no?

Re: Trading halted as U.S. stocks plummet

#72

Post by Insanity »

azhenley wrote: post #65
aswanson wrote: post #39

Earlier quoted context omitted.

Correction is way overdue. Problem is, Fed has no ammo left with interest rates at near zero. We're in for rough days, people.

It is possible for interest rates to be negative. Not that I'm recommending that to happen!

Something that actually happened in Sweden! Although it seems like it's not like that anymore:

https://www.thelocal.se/20191219/sweden-abandons-negative-in...

Re: Trading halted as U.S. stocks plummet

#73

Post by MS90 »

Waterluvian wrote: post #63
pureagave wrote: post #33

Earlier quoted context omitted.

Correct. 7% decline is a pause. If it drops 13% it will pause for another 15 minutes. If it drops 20% it will end trading for the day.

I'm going to say it. It can't possibly collapse 20% in one day... can it?

Looks like it's only happened once, 22.61% on Oct 19, 1987.

Even the 1929 crash wasn't that much, though it did drop about 24.5% over two days, Oct 28 and 29, 1929.

https://en.wikipedia.org/wiki/List_of_largest_daily_changes_...

Re: Trading halted as U.S. stocks plummet

#74

Post by treis »

fancyfredbot wrote: post #50
aazaa wrote: post #10

This will be blamed on COVID-19, but the problems go much deeper. Last year the Fed lost control of the repo market. the event was widely discounted at the time as an end-of-tax-year fluke. It wasn't. Six month ago, the yield curve inverted. People who should have known better said "this time is different." Speculators have been trained over the course of 10+ years to buy the dip. The Fed has your back. What we're se…

This is widely being blamed on oil prices (edit: the virus would have been priced in last week to some extent, but the decision by Saudi Arabia to increase oil production happened over the weekend and hadn't been).

Oil prices going down is a good thing for the economy.

I think people are confusing cause with an effect/correlation. Oil going down usually indicates a recession. Bad economy -> Lower demand for Oil -> Lower oil prices. In that case it's a signal/trailing indicator.

In this case it's: Increased oil supply -> Lower oil prices -> Everything gets cheaper to make -> Increased economic activity

Re: Trading halted as U.S. stocks plummet

#75

Post by steveeq1 »

adventured wrote: post #56
aswanson wrote: post #39

Earlier quoted context omitted.

Correction is way overdue. Problem is, Fed has no ammo left with interest rates at near zero. We're in for rough days, people.

The Fed has as much ammo as there is wealth held in dollars. Which is to say, a lot. First, there is negative rates. Punishing people for holding cash. The ECB and Bank of Japan have done a lot of pioneering work there, the Fed will have already extensively studied what they did, what worked, what didn't work. Second, they have QE, monetizing debt & debasing dollar wealth, which is exactly what they'll unleash for th…

I can practically just smell the inflation.

Re: Trading halted as U.S. stocks plummet

#77

Post by falcolas »

The fact that these controls on the stock market have been triggered reinforces my doubts that our current "profits and growth over sustainability" view of how public companies should operate is in any way good.

Short of a huge change in COVID-19's mortality rate, few if any of these businesses will go under in the next year naturally. The fire sale of stocks due to short-term impacts to revenue, however, just might do what COVID-19 can't.

Re: Trading halted as U.S. stocks plummet

#78

Post by Insanity »

Waterluvian wrote: post #68
aguyfromnb wrote: post #27

Earlier quoted context omitted.

Koyfin: https://www.koyfin.com/home

"I don't know how to read most of this, but I do see that everything's red."

Yeah I'm feeling pretty much the same.

If this was the status of our builds at work, I'd be very worried.

It's interesting to see how it spikes up and down though, never really paid attention to it until now:

https://www.koyfin.com/charts/gip/INDU_EC?t=SPX&t=NDX&frame=...

Re: Trading halted as U.S. stocks plummet

#79

Post by ailideex »

aganame wrote: post #60

Trump created a situation that's shaky as hell. I'm glad something happened that makes him suffer at least some consequences for once. Too bad it had to be this bad an event.

Ehh... I mean ... if the whole rest of the world was somehow unaffected by this ... then ...

You do get that a reasonably conservative projection is that within a year most people in the world would have gotten COVID-19? How the heck did Trump do that?

The only means of slowing COVID-19 has massive effects on the economy. There is now way in hell this would not have had a massively negative impact on the world economy. If you could give some meaningful argument for why US is handling it worse than the rest of the world, by all means. But just saying "Trump is bad" seems to be completely disregarding the reality.

Re: Trading halted as U.S. stocks plummet

#80

Post by secfirstmd »

treis wrote: post #74
fancyfredbot wrote: post #50

Earlier quoted context omitted.

This is widely being blamed on oil prices (edit: the virus would have been priced in last week to some extent, but the decision by Saudi Arabia to increase oil production happened over the weekend and hadn't been).

Oil prices going down is a good thing for the economy. I think people are confusing cause with an effect/correlation. Oil going down usually indicates a recession. Bad economy -> Lower demand for Oil -> Lower oil prices. In that case it's a signal/trailing indicator. In this case it's: Increased oil supply -> Lower oil prices -> Everything gets cheaper to make -> Increased economic activity

Good for short/medium term economy, terrible for the environment though unfortunately. So probably bad for the long term economy when carbon/environmental risks take effect.
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