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

Yield Curves Invert in U.S., U.K

bloomberg.com

Post reply on HN
Print view View original

201–210 of 671 posts

Re: Yield Curves Invert in U.S., U.K

#201

Post by kart23 »

sigstoat wrote: post #159
kart23 wrote: post #150

Earlier quoted context omitted.

Not just boomers. Robinhood has made it so you can buy stock on your iphone in a couple minutes. Everyone has stock, and I think the market is crazy overvalued right now. I think everything's a bubble right now. People are in loads of debt, more regular americans invest in the stock market, driving prices higher, all we need is a spark to get the fire going. Could come in the form of china and Hong Kong, could be the…

> Everyone has stock everyone _should_ have stock; what reasonable investment plan doesn't have stock? you might as well hyperventilate about everyone having drawers full of socks.

Sorry, I meant more like day traders and volatile stocks. Especially younger people, who can now become day traders and even trade options with ease. Investment plans are different in the idea that the money is in there for an extended amount of time, and usually just stays invested.

Re: Yield Curves Invert in U.S., U.K

#202

Post by lotsofpulp »

WarDores wrote: post #154
kart23 wrote: post #150

Earlier quoted context omitted.

Not just boomers. Robinhood has made it so you can buy stock on your iphone in a couple minutes. Everyone has stock, and I think the market is crazy overvalued right now. I think everything's a bubble right now. People are in loads of debt, more regular americans invest in the stock market, driving prices higher, all we need is a spark to get the fire going. Could come in the form of china and Hong Kong, could be the…

Agreed. The stock market is seen as a sure thing right now. It's a buying frenzy out there, even for companies that have zero fundamentals.

Is it not a sure thing? Time and time again, the US government has been willing to sacrifice the value of the dollar to pump up the value of equities. Maybe the share price of certain companies decline, but the voters of the US have a vested interest in keeping equity prices high (401k, pension fund investments, etc).

On top of that, the number of companies has been getting smaller and smaller, and the companies left are getting bigger and bigger. If anything, there is more systemic risk than before, and hence even more incentive for bailouts.

As far as I can tell, the day the US stops bailing out equities, I imagine it will be in a weakened state where the USD no longer has reserve currency status, and there might be bigger problems to worry about than a recession. Until then, total stock market ETFs should do at least as well as inflation.

Re: Yield Curves Invert in U.S., U.K

#203

Post by throwanem »

streetcat1 wrote: post #181
tlogan wrote: post #116

Earlier quoted context omitted.

And things will be worse because China is also heading into recession. You know, you need sell all these products to somebody... And when US consumer stops buying new iPhones (or what ever) combined with recession then situation is going be really really tough. So this will be worse that 2008. Much worse. Back in 2008, China was growing and helping to ease the recession. I do not think China's economy will grow durin…

It would not be worse than 2008. since what happen in 2008 is known, by definition it is already prepared for and backed into global risk assessments. It can only get worse if there is something that was NOT present in 2008 will manifest itself.

A parallel recession in China, for example.

Re: Yield Curves Invert in U.S., U.K

#204

Post by mlpinit »

kkotak wrote: post #185
elamje wrote: post #160

A very useful caveat from the insightful, and cautious, Howard Marks - > In that regard, the Financial Times noted on June 1 that “the [yield curve] has ‘inverted’ before every US recession in 50 years.” (Note, however, that this is different from saying every inversion has been followed by a recession.) https://www.oaktreecapital.com/docs/default-source/memos/thi...

Akin to - "It always rains on my birthday. It's raining today - it must be my birthday."

if p, then q is not equivalent with if q, then p. However this follows: if ~q, then ~p. It's not raining, it must not be my birthday.

Re: Yield Curves Invert in U.S., U.K

#205

Post by cestith »

roymurdock wrote: post #165
cjrp wrote: post #157

Earlier quoted context omitted.

> What does trump get from initiating/escalating it Kudos from his base, enhances his "tough guy" image, helps his 2020 campaign.

I've heard that argument but it's wrecking parts of the ag sector, hurting manufacturing (big parts of his base), and will probably push all consumer prices up. I guess if his base can't put 2 and 2 together that prices are rising due to his tariffs it almost makes sense. But I don't think it's that simple, he's clearly a coin operated guy so which coin is operating him to escalate this trade war?

Kopeks and rubles are most likely.

Re: Yield Curves Invert in U.S., U.K

#206

Post by refurb »

sxcurry wrote: post #171
roymurdock wrote: post #151

Earlier quoted context omitted.

My question is what is the point of the trade war. What does trump get from initiating/escalating it, or who is directing him to do it. Seems to be a net negative for all sectors of the economy.

As Paul Krugman says, "What looks like raw ignorance and prejudice is, in fact, raw ignorance and prejudice".

I’m no fan of the President, but Paul Krugman’s rants have gone from heated to just bizarre at this point. Shows that even Noble laureate’s aren’t immune from going off the rails.

Re: Yield Curves Invert in U.S., U.K

#207

Post by jonny_eh »

roymurdock wrote: post #183
sxcurry wrote: post #171

Earlier quoted context omitted.

As Paul Krugman says, "What looks like raw ignorance and prejudice is, in fact, raw ignorance and prejudice".

Come on this guy is the president of the US people need to stop calling him ignorant and dumb just because they don't like aspects of his persona (racist/greedy/cunning/divisive). He is surrounded by aides and business people giving him information and trying to forward their own agendas. He's not just sitting there thinking "wouldn't it be fun to start a trade war to look tough". I respect Krugman as an economist bu…

Would it have been wrong to call King George III mad?

Re: Yield Curves Invert in U.S., U.K

#208

Post by dionian »

tlogan wrote: post #116
throwaway5752 wrote: post #109

Everyone serious knew that a trade war would set a recession in motion, and that it would be a trade war the US would lose because of the directionality of the trade. The thought has always been that the president was using a high leverage negotiating strategy (see https://www.newyorker.com/news/news-desk/for-trump-diplomacy... , for example) to extract maximal concessions from PRC. But in the end, most of the people…

And things will be worse because China is also heading into recession. You know, you need sell all these products to somebody... And when US consumer stops buying new iPhones (or what ever) combined with recession then situation is going be really really tough. So this will be worse that 2008. Much worse. Back in 2008, China was growing and helping to ease the recession. I do not think China's economy will grow durin…

Which would indicate that US will have a massive amount of leverage to renegotiate trade

Re: Yield Curves Invert in U.S., U.K

#209

Post by sremani »

adventured wrote: post #168
throwaway5752 wrote: post #147

Earlier quoted context omitted.

Maybe I'm a crazy for taking the state of the fed funds rate, the budget deficit, and the Fed's balance sheet into account? We can print money, but so far the USD hasn't reflected any sort of consequence for that. They can do a QE program, but will other actors accept the implicit loss on their treasury holdings? I can think of one major player there that is a lot less likely to do so now.

The Fed can replace / deal with China's treasury holdings relatively easily at this point, especially given the strength of the dollar. While $15t in global paper is yielding nothing or worse, the US is still yielding something and is still largely regarded as entirely safe by investors. China is no longer a threat to the treasury market re selling, even though more aggressive selling on their part would definitely c…

What exactly is wrong with this comment for the kind of downvotes?

At personal level, I find adventure one of the most level headed and dispassionate commentators esp. about Finance/Business/Geopolitics.

The whole China treasure holdings argument is at the best paper tiger. The argument is debunked by every respectable finance commentator.

Re: Yield Curves Invert in U.S., U.K

#210

Post by refurb »

cjrp wrote: post #157
roymurdock wrote: post #151

Earlier quoted context omitted.

My question is what is the point of the trade war. What does trump get from initiating/escalating it, or who is directing him to do it. Seems to be a net negative for all sectors of the economy.

> What does trump get from initiating/escalating it Kudos from his base, enhances his "tough guy" image, helps his 2020 campaign.

So your argument that China has been engaging in free trade with the US up to this point and we have no valid concerns?
Post reply on HN