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

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

#271

Post by [deleted] »

magduf wrote: post #188
roymurdock wrote: post #165

Earlier quoted context omitted.

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?

>I guess if his base can't put 2 and 2 together that prices are rising due to his tariffs it almost makes sense. His base really can't put 2 and 2 together. You seem to think it's obvious that tariffs will cause prices to rise, but you seriously underestimate just how stupid these people are.

[deleted]

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

#272

Post by papito »

SkyBelow wrote: post #238
magduf wrote: post #188

Earlier quoted context omitted.

>I guess if his base can't put 2 and 2 together that prices are rising due to his tariffs it almost makes sense. His base really can't put 2 and 2 together. You seem to think it's obvious that tariffs will cause prices to rise, but you seriously underestimate just how stupid these people are.

If your explanation requires assuming that both very powerful politicians and their supports, constituting tens of millions of people, are all incompetent, then perhaps you need to consider an explanation that doesn't require such assumptions.

The explanation is much worse. Guess one single issue that matters to his base, no matter what.

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

#273

Post by chillacy »

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".

Paul Krugman also said the internet was a fad, why is he worth quoting?

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

#274

Post by papito »

apo wrote: post #33

Key recession indicator is flashing red. Unlike the stock market, which is both backward- and forward-looking, the bond market is myopically forward-looking. When the yield between the 10-year and 2-year US treasury inverts, a recession is months away. This chart, showing the difference between the yield (or spread), shows recessions in grey: https://journal.firsttuesday.us/using-the-yield-spread-to-fo... Notice how…

Tell me about it. I offloaded most of my 401K into Fidelity long-term bond fund, and it's up 20% for the year.

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

#275

Post by theli0nheart »

ummonk wrote: post #248
strenholme wrote: post #221

I remember the dot-com crash of 2001 and seeing companies close so fast, they didn’t their employees a final paychecks; I remember one day, after the dot-com collapse a position I was qualified for got filled within three hours. As someone who has seen this before, things are looking ominous: The stock market drop of late 2018 reminded me of the stock market drop we had in 2000, about a year before everything fell ap…

I think the difference this time around is that the largest tech companies (Apple, Google, Facebook, Microsoft, to a lesser extent Amazon) are generating healthy profits. So while there is likely an issue with a lot of the unprofitable unicorns, the industry as a whole won't collapse.

Well, two of those companies survive largely on the basis of advertising, which is in turn financed through the Silicon Valley Venture Capital Machine. If that dried up, it would be Bad News.

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

#276

Post by 8ytecoder »

strenholme wrote: post #221

I remember the dot-com crash of 2001 and seeing companies close so fast, they didn’t their employees a final paychecks; I remember one day, after the dot-com collapse a position I was qualified for got filled within three hours. As someone who has seen this before, things are looking ominous: The stock market drop of late 2018 reminded me of the stock market drop we had in 2000, about a year before everything fell ap…

First of all predicting a crash is a fool’s errand. It as much about emotions as it is about fundamentals. There’s a perfectly valid explanation for the valuation of Startups and the availability of capital for startups in the last 9 or so years. After 2008 crash, markets were stagnant until 2012. At the same time capital was being eased by govts worldwide. This capital has to flow somewhere. Tech startups were ripe at this crucial juncture for investments - we had seen enough successes with the likes of Facebook, Amazon and Google - and tech had a major point in its favour in terms of being able to scale easily. Now, in hindsight (personally i never thought it could work as claimed) this is emphatically not true for the sharing economy.

Plenty of articles have been written about it 2-3 years ago. We all have short term memory and are forgetting this. Every major tech publication predicted a crash in the startup economy. It never came about.

None of this related to the macro environment we are at. Trade wars wreak havoc on the sentiment of business than the actual supply chains themselves. Which is what seems to be happening now.

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

#277

Post by refurb »

leetcrew wrote: post #32
dboreham wrote: post #28

Earlier quoted context omitted.

"and timing the market" Hmm. Isn't that known to be impossible?

not impossible, but very unlikely for a layman. it's like trying to win a 1v1 against an NBA player.

For the layman? I’d argue any investment professional who correctly timed the market (as a whole) simply got lucky.

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

#278

Post by cestith »

theandrewbailey wrote: post #266
cestith wrote: post #218

Earlier quoted context omitted.

There are two things China has been doing for years that the WTO hasn't put an end to. The stated goals of the trade war include stopping those, which I can - as anything but a fan of anything to do with Trump - actually agree need to stop. I'm far from certain the scale and breadth of tariffs involved are necessary to stop them, but I agree those two practices need to stop. One of those is outright IP theft. One esp…

Navarro said it best [0]: Stop stealing our intellectual property Stop forcing technology transfers Stop hacking our computers and steal our trade secrets Stop dumping into our markets and putting our companies out of business Stop their state-owned enterprises from heavy subsidies Stop the fentanyl Stop the currency manipulation [0] https://www.foxbusiness.com/economy/trumps-china-tariffs-not...

I'm not sure we can blame our fentanyl problems on China any more than our cocaine problems on Colombia or our heroin problems on Mexico.

Currency control comes with being a sovereign nation. Our government and the Federal Reserve in the US issue more or less new money into the economy and raise or lower interest rates to control the strength of the US dollar all the time.

I'm not sure dumping is a real problem for most products. Ones that are dumped are often cheaper in the first place because of the other problems, because it's easy to sell cheap when you didn't pay for research, development, design, or industrial engineering for the product. Other dumped products are often such low quality that they could be driven out of the market with consumer rights laws and lemon laws.

The rest I can agree are real issues.

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

#279

Post by fuzz4lyfe »

AnimalMuppet wrote: post #220
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.

What consequence would you expect? Inflation? The Fed would probably welcome inflation right now. And, how does QE cause other players to lose their treasury holdings?

>The Fed would probably welcome inflation right now.

I feel like this while correct will look funny in the context of history. I believe inflation will explode in the next 5 years with near zero interest rates and the fed printing money for all the programs we hear about during the recent debates.

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

#280

Post by refurb »

Retric wrote: post #39
leetcrew wrote: post #32

Earlier quoted context omitted.

not impossible, but very unlikely for a layman. it's like trying to win a 1v1 against an NBA player.

Depends on what you mean by timing the market. Several strategies like keeping a fixed ratio of stocks to bond are effectively timing the market. You pull money out of stocks when they go up, and put money into them when they go down. Personally, I am less interested in absolutely maximizing my returns as I am maximizing the likelihood of reaching a return threshold.

A fixed ratio like rebalancing? That’s not really timing the market as you typically rebalance after a set period regardless of how the market has moved.
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