Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Wall Street sell-off turns 'ugly' as US recession fears grow

independent.co.uk

Post reply on HN
Print view View original

61–70 of 185 posts

Re: Wall Street sell-off turns 'ugly' as US recession fears grow

#61

Post by hnpolicestate »

Is it possible that wall streets economic interests were not aligned with the interests of U.S citizens? One could argue we are now so down the road of globalization that any attempt to pull back would cause economic disaster. I think probably yes.

The wealthy make their money in the market, while the poor rely on wages whose dollar keeps decreasing in value. I get the 401k angle too. But for too long the wealthy have prospered through dividends while the plebs can't afford rent, let alone a house.

Re: Wall Street sell-off turns 'ugly' as US recession fears grow

#62

Post by mjburgess »

michaelscott wrote: post #25
fn-mote wrote: post #14

Earlier quoted context omitted.

> [...] buying low now would be nice. Just to be clear, the point of the linked article is that you cannot know that now is the LOW and not the new high.

That's the premise yeah, but it makes sense to buy more on red days

But that can't possibly be the case -- since such a simple strategy is already priced into the red.

Anything accessible to any person without days/weeks of research or insider knowledge is already priced-in. All the people rationally "buying the dip" are doing so as the price dips.

Any time you buy, you are betting on a future price against everyone else making bets. Most of those other people, who can move markets, are spending their entire lives in R&D to eek out a slightly better bet.

You're a mark if you think you can price better than them -- and they are the ones presently setting the price.

Re: Wall Street sell-off turns 'ugly' as US recession fears grow

#63

Post by darth_avocado »

ren_engineer wrote: post #26
cj wrote: post #2

Hopefully this isn't a biased take: I think this is a unique situation because the recent moves (in my opinion) are largely a result of everyone's uncertainty around America's policies. In other words, the recent stock moves aren't because we're seeing a bunch of companies fail to miss quarterly targets. There are no major economic indicators flashing red. If stocks can drop that fast in a couple weeks, they can also…

just cutting government spending would automatically put the US into recession, deficit spending is the only thing that has kept things going. Huge amount of job growth is either direct government hiring or indirect through businesses hiring off revenue from government contracts

Historic job growth means nothing if everyone needs 3 jobs to earn median household income.

Re: Wall Street sell-off turns 'ugly' as US recession fears grow

#64

Post by criddell »

voidfunc wrote: post #12
lazide wrote: post #10

Earlier quoted context omitted.

Hah, do you think Trump can admit he messed up and change course?

Sort of, but it won't be framed that way. It will just be "we achieved our objectives and we're moving on"

It will be filed away next to the built a wall that Mexico paid for victory.

Re: Wall Street sell-off turns 'ugly' as US recession fears grow

#65

Post by FredPret »

mberning wrote: post #3

To be fair I think this is long overdue. The fundamentals do not support the price of many stocks. Recently Tesla had more market cap than Toyota and many other established brands combined. No way in hell that is believable.

This is true but then there are giant corporations earning giant profits trading at a PE It's only sexy stocks that people get excited by that go to the moon on a paper kite.

For example:

- Comcast (does the public hate them? yes. does the public send them ~$35B in revenue every damn quarter? also yes): PE 8.7 (https://valustox.com/CMCSA)

- JP Morgan, 5th largest bank in the world, biggest bank in the USA. Is banking risky? Yes. Is JP Morgan going to evaporate? Hell no. PE: 11.7.

- General Motors. Setting the world ablaze? No. Going anywhere in the next 20 years? Probably not. Look at their revenue trend. (https://valustox.com/GM) PE: 7.4.

- United Airlines. Yes, they break guitars. Yes, airlines have been a risky bet. But their PE ratio is 8.1. (https://valustox.com/UAL) When you buy cheap, risk is low.

If you see a company's products everywhere but you never hear about their stock, your bargain-stock spidey senses should kick in. When it's the inverse, I stay far away.

Re: Wall Street sell-off turns 'ugly' as US recession fears grow

#66

Post by scarface_74 »

cj wrote: post #2

Hopefully this isn't a biased take: I think this is a unique situation because the recent moves (in my opinion) are largely a result of everyone's uncertainty around America's policies. In other words, the recent stock moves aren't because we're seeing a bunch of companies fail to miss quarterly targets. There are no major economic indicators flashing red. If stocks can drop that fast in a couple weeks, they can also…

This is the only administration that will be able to get away with being this incompetent hopefully. Even if the stock market does go in a free fall this administration, in four years, it should start recovering. Looking at the rest of the leading Republicans, most of them are spineless. But don’t have the same belief system as Trump. You didn’t see any of them parroting Trump’s economic policies during the primaries.

As long as you have at least a ten year time horizon - and you should if you are investing in the broad stock market - you should be fine.

From a completely selfish standpoint, the stock market being down is great - it’s time to buy.

I do feel sorry (not really) for anyone who invested in Tesla. Its brand value is shit globally and the fundamentals aren’t good.

Re: Wall Street sell-off turns 'ugly' as US recession fears grow

#67

Post by aetherson »

simonsarris wrote: post #43
timewizard wrote: post #9

Earlier quoted context omitted.

> There are no major economic indicators flashing red. High levels of corporate monopolization, high levels of stock buybacks, and low to no wage growth. They've been flashing for so long people don't even recognize them anymore.

> and low to no wage growth Huh? There was "low to no wage growth" in the 80's and 90's. We do have wage growth now. https://fred.stlouisfed.org/series/LES1252881600Q Wage growth for over 25 no-college earners has been even better. > high levels of stock buybacks There's nothing economically dire, or even weird, about choosing buybacks over dividends in returning profits to shareholders. It just lets shareholders cho…

We've propagandized a generation of people into believing that there has been no wage growth for 40 years when the deal was actually that there were falling wages in the 80s, stagnant wages in the 90s, and growth since then (with a recession after 2008 that has been fully caught back up to since).

Re: Wall Street sell-off turns 'ugly' as US recession fears grow

#69

Post by Swizec »

panarky wrote: post #46
cj wrote: post #2

Hopefully this isn't a biased take: I think this is a unique situation because the recent moves (in my opinion) are largely a result of everyone's uncertainty around America's policies. In other words, the recent stock moves aren't because we're seeing a bunch of companies fail to miss quarterly targets. There are no major economic indicators flashing red. If stocks can drop that fast in a couple weeks, they can also…

It's surreal watching all the analysts stumble around trying to explain market behavior with half-baked explanations. One says it's tariffs, another says it's "uncertainty", a third worries about "recession", others say "inflation" or "stagflation". But none of them show logically or quantitatively how tariffs or "uncertainty" or vague, unsubstantiated worries about recession reduce the present value of future cash f…

> reduce the present value of future cash flows

> Deep cuts of 50% of more to government employment, selective default on government obligations, convert formerly independent institutions to ideological organs, devaluation of the dollar, and picking winners and losers based on ideology and diktat

All of these reduce the present value of future cash flows by reducing said future cash flows. Like a sibling poster said: If the government stops spending, the US economy is screwed. The US is a lot less "free market" than most realize. Much of the economy is propped up by various subsidies at the raw inputs level.

Also when you choose winners and losers by diktat, this inadvertendly reduces the present value of future cashflows for any company that doesn't get picked.

Re: Wall Street sell-off turns 'ugly' as US recession fears grow

#70

Post by pinkmuffinere »

velcrovan wrote: post #51
michaelscott wrote: post #39

Earlier quoted context omitted.

Agreed, this seemed inevitable. And as a bull, I don't even think we're close to the bottom for the year

So… you're not a bull then

On the Internet, nobody knows he’s actually a human
Post reply on HN