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Show HN: Is the stock market going to crash?

isthestockmarketgoingtocrash.com

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Re: Show HN: Is the stock market going to crash?

#291

Post by lugg »

StanislavPetrov wrote: post #255
wyager wrote: post #170

Earlier quoted context omitted.

> Hopefully this one is based on solid enough fundamental market forces that it persists after its publication. If you can find any way to predict the future price of things, you can make money by performing arbitrage across time (instead of space, which is how people usually think of arbitrage). This (nominally) describes all types of model-informed time-based investment. The thing with arbitrage is that there's a f…

This is true in a theoretical free market where there is price discovery. In the "markets" that actually exist, though, we don't have true price discovery. We have a market with centrally controlled interest rates, central bank purchasing (in a variety of ways) and other institution-based interference that create inefficiencies that are not organic, and are therefore not self-correcting.

I don't think that changes the previous statement. It just changes the value of truth. Maybe not self correcting, but certainly self regulating towards the new normal as set out by regulatory constraints.

Re: Show HN: Is the stock market going to crash?

#292

Post by jxramos »

chrisweekly wrote: post #286
PDoyle wrote: post #119

Earlier quoted context omitted.

Wow, really interesting read. Thanks for the link. Only trouble is that once people find patterns like this, they have a habit of disappearing. Hopefully this one is based on solid enough fundamental market forces that it persists after its publication. It was published in 2013 so we won't know for sure until after 2023.

> "... once people find patterns like this, they have a habit of disappearing." Hah! Grammatically, "they" refers to the people (not the pattern). IMHO, sometimes these details matter, as in: "Let's eat grandma!" vs "Let's eat, grandma!" or "know your shit" vs "know you're shit" :)

what makes his sentence not an amphiboly? What's the grammatical rule that fixes the "they" to apply to the people not the pattern?

Re: Show HN: Is the stock market going to crash?

#293

Post by yuhong »

Yea, the US economy is based on constantly growing debt basically, which can't last forever. My favorite is the ad bubble now, and ads are basically designed to increase consumption. It is probably worth mentioning China too: http://www.zerohedge.com/news/2017-08-06/chinas-minsky-momen...

Re: Show HN: Is the stock market going to crash?

#294

Post by Sohcahtoa82 »

justin66 wrote: post #64
knewter wrote: post #19

Earlier quoted context omitted.

> Seriously, though, this is a real problem and we need to do something the thing we have to do is not borrow money we can't repay. capitalism is a distributed system. borrowing money you can't repay is a broken local protocol. don't try to fix that with anything but fixing it locally.

> the thing we have to do is not borrow money we can't repay. Literally nobody takes student loans that they are capable of repaying. Why would you, unless you could get a 0% APR? It'd be nice if young people - possessors of great foresight and fonts of wisdom, all - could predict whether they will be able to repay the very substantial loans they're likely to rack up in college. We are not living in a world, or an ec…

> Literally nobody takes student loans that they are capable of repaying.

Probably one of the most incorrect sweeping generalizations I have ever seen.

I finished my BS in CS about 3 1/2 years ago with about $44,000 in student loan debt. I'm currently on track to pay them off within the next 3 years. It'd probably be only 1 or 2 years if I didn't buy a car.

Re: Show HN: Is the stock market going to crash?

#295

Post by Sohcahtoa82 »

ihsw2 wrote: post #223
SmellTheGlove wrote: post #15

Earlier quoted context omitted.

I wouldn't worry about student loan debt being a problem. It's very likely that they're going to get a bailout before a bubble bursts. Where on earth did I come up with this, you ask? Easy - I just paid my student loans off last week. It's only natural that everyone else will now get bailed out! Seriously, though, this is a real problem and we need to do something. Even if it doesn't have a direct effect any time soo…

It's already hurting the housing and consumer spending segments, as per the incessant and continuous "Millenials are killing the X industry" clickbait every other hour. Replace X with home ownership, car ownership, renovation, Chili's, Applebee's, and whatever else services the traditional nuclear family.

The baby boomers cry about millennials killing X industry while in the same breath cry about millennials acting entitled for demanding reasonable wages.

https://pbs.twimg.com/media/DDQqtCyUwAAUp6e.jpg

Re: Show HN: Is the stock market going to crash?

#296

Post by MarkMc »

module0000 wrote: post #234
choxi wrote: post #58

Earlier quoted context omitted.

I think the subtitle sets expectations pretty clearly: > No one knows for sure, but there are indicators that can help us guess. We can chart these indicators to give us the illusion of foresight.

Holy shit, just seeing the "indicators that can help us guess" gives me shivers. The person who utters that phrase is admitting to guessing with their money. Does anyone else find that as absurd as I find it? If I hire a pro to enter/exit a position, if they are guessing(with or without the assistance of indicators), I have made a very bad decision to hire them .

Perhaps you and I have different definitions of the a word 'guess'. To me, it includes 'Making a logical estimate based on available evidemce'. Every investment decision is a guess.

Re: Show HN: Is the stock market going to crash?

#297

Post by luckydude »

graedus wrote: post #157
charlesdm wrote: post #104

Earlier quoted context omitted.

You can see the writing on the wall now, with stocks being pumped up around the world by central banks and with margin debt at an all time high. The problem is, it could be years before there is a collapse, or it could be tomorrow. That's a lot of yield you might be losing out on. A near similar argument could be made in 2014. You probably could have doubled or tripled your money in that period. And even if there is…

> The problem is, it could be years before there is a collapse, or it could be tomorrow. That's a lot of yield you might be losing out on. A near similar argument could be made in 2014. You probably could have doubled or tripled your money in that period. All true. I think what makes sense then is not to get out of the market entirely, but depending on your risk tolerance, simply re-balance so that you own less stock…

Look into structured notes. You can get some gains with sort of an insurance policy.

Re: Show HN: Is the stock market going to crash?

#298

Post by luckydude »

icedchai wrote: post #199
luckydude wrote: post #84

Earlier quoted context omitted.

"occurrences that nobody was aware of and that were only understood afterwards" Umm, I'm no genius but I was managing my mother's money at the time of the 2008 crash. It was very obvious to me that there was going to be a crash, I pulled out of the market in late 2006 and didn't lose a dime in the crash. I think the better statement is "The 2008 crash was obvious but many people were in denial". Again, I'm not a fina…

So you pulled out in 2006... When did you get back in? Timing the market is hard...

Like I said, I'm not a financial wizard, so I'm mostly in cash and I've missed some upside. Not completely, have a pile of Apple stock that's done well, but I'm not the right guy to be managing money. So I've moved most of it to a guy at Morgan Stanley that a friend has been using for a long time.

Re: Show HN: Is the stock market going to crash?

#299

Post by philipodonnell »

module0000 wrote: post #262
jliptzin wrote: post #260

Earlier quoted context omitted.

Couldn't this strategy be easily automated, and therefore, probably has been competed away by now?

The more this strategy is automated, the more effective it becomes. This is a simple explanation for "trends", as people see liquidity consumption and enter on the side to further consume it - more people repeat the pattern. The net result is a "trend", which is a blunt way of saying "demand exceeded supply in direction". There is no sane way to automate this, since everyone's description of "enough" volume delta is…

This is most adaptive algorithms work, though. As your scenario gets played out over and over, the high threshold people will notice the decline in profitability and look for ways of improving the algorithm. They'll look at the various parameters and notice that the lower the volume delta the higher the return, so the volume delta parameter will come down. As everyone's volume delta comes down, the strategy will work less and less until it roughly equals the discount rate.

Anything that can be completely automated will lead to an elimination of excess returns. Having a single parameter that differs between market participants is not enough to stabilize a long-term imbalance.

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