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Wall Street sell-off turns 'ugly' as US recession fears grow
101–110 of 185 posts
Re: Wall Street sell-off turns 'ugly' as US recession fears grow
#102Earlier quoted context omitted.
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
Migrating employees out of the state (which leeches economic output from the private sector) will have positive long-term economic outcomes.
Moving some employees from government (which has some economic value and some non-economic value) to the much higher economic productivity private sector will be brilliant for the economy long term.
But that doesn't mean the most chaotic approach is the best one. Bill Clinton shrunk the federal workforce by 400k without crashing the economy.
I'm a huge free market fan but I note that there's a lot of nice things that come from government jobs, for example clean and safe streets, or well-planned highways, and many others.
Re: Wall Street sell-off turns 'ugly' as US recession fears grow
#103S&P 500 is barely down (~9% as of this post) after returning 23% and 24% respectively in 2023 and 2024. I wouldn't call it ugly, as someone who lived through recession.
A major correction also isn't that surprising. I started planning for it six months ago. The current market behavior is what I'd call "in model". It can always get much worse but this isn't that.
Re: Wall Street sell-off turns 'ugly' as US recession fears grow
#104Hopefully 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…
The present value of future cashflows is vague at best. The market was overpriced and is correcting now. Look at the Shiller PE.
Re: Wall Street sell-off turns 'ugly' as US recession fears grow
#105Earlier quoted context omitted.
Tesla is way better positioned than Toyota in likely upcoming EV world, so capitalization is result of future expectations.
Yeah yeah. Diagram that out to its conclusion for us. The future where Tesla is producing more cars than Toyota at higher margins. What year will that happen?
> producing more cars than Toyota at higher margins
Interesting that Tesla surpassed Toyota in net income in 2023 already: 15B vs 14B.
Re: Wall Street sell-off turns 'ugly' as US recession fears grow
#106Is 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 hav…
This is my observation as well. Recent market gains doesn't reflect how inflation eroded most people purchasing power.
People today are worse off than before Covid even though the market is much higher.
Debt fueled growth (through quantitative easing and deficit spending) is not healthy and always has a bad ending.
Real economic growth is what was seen between 1950 and 1970 where purchasing power increased and most of the gains went to the middle class.
Re: Wall Street sell-off turns 'ugly' as US recession fears grow
#107Earlier quoted context omitted.
I personally think of a bubble has having a significant speculation component which I don't think applies wholly to the housing market in the same way it does today's stock market. The reasons that housing prices are so high, in my opinion, is primarily because of structural problems. But certainly others may feel differently or define a bubble differently.
The reasons likely vary by region.
I think that's true and even true at a zip code level for some locations. Broadly speaking though I think I stand by my assessment but always interested to hear other opinions on the topic because it is quite fascinating.
Re: Wall Street sell-off turns 'ugly' as US recession fears grow
#108Hopefully 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…
> 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.
> High levels of corporate monopolization, high levels of stock buybacks, and low to no wage growth.
Yes
But the Elephant on the sofa is a deranged President threatening important trade partners
Duh!
Re: Wall Street sell-off turns 'ugly' as US recession fears grow
#109Hopefully 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…
> especially if the catalyst was some poorly timed or thought out US policy decisions.
Is there any indication this will change or that worse decisions won't come out next week?