When buying the dip doesn’t work: An analysis of the dot-com crash • Hacker News Board

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#391

Post by UncleMeat » Mon, May 09, 2022, 1:03 PM UTC

srean wrote: post #328

refurb wrote: post #268

Earlier quoted context omitted.

Ok, then I misunderstood and am very confused. You said "This a very popular idea but I don't fully accept it. Goals and desires are not static. They are path dependent and adaptive. I want a funding scheme that's able to fund that." Which I interpret as "I reject the idea of setting some financial goal decades into the future. I want a scheme that is flexible and can accommodate changes to how I want to use my money…

The best sort of discussions are those where each is happy with the other's rewording of their position. I certainly do not reject setting financial goals decades into the future. I do not like ('like' and 'reject' aren't synonyms) investment discipline that are strictly fixated on some goal I had in the past. I would rather have an adaptive trade off of risk to return depending on where I am right now financially. S…

The core problem here is that nobody understood your original comment or the follow ups. It isn't clear what you are criticizing or what alternative you want.

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#392

Post by UncleMeat » Mon, May 09, 2022, 1:06 PM UTC

hn_throwaway_99 wrote: post #92

vitus wrote: post #2

> Buying the dip isn’t some secret strategy. Time is the secret strategy. Ah yes, the good ol' "time in market beats timing the market". Of course, that assumes that markets trend upwards in the (very) long term. Which... if past performance is any indicator of future performance [0], the past 100 years provide a fairly compelling narrative. [0] Another mantra: it's not.

> the past 100 years provide a fairly compelling narrative. In the US. The Nikkei is down over 25% from its peak 32 years ago .

Could this be the exception that proves the rule? I have never seen any example used for this argument except Japan. That makes it seem like the situations that generated that crash and continued loss are pretty unusual. At some point, it becomes difficult to make financial plans in order to mitigate a situation this rare.

For a huge portion of people, it is impossible to build wealth on a salary. Investing is basically mandatory unless you want to have a very low budget in retirement and live entirely off social security.

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#393

Post by tsimionescu » Mon, May 09, 2022, 2:37 PM UTC

chii wrote: post #265

baq wrote: post #260

Earlier quoted context omitted.

Define far. Gasoline engines eg are within 2x of Carnot limit. Not much room for improvement.

> Not much room for improvement. Only for gasoline engines. And the efficiency limit isn't the limit of possible sources of energy for work. Future engines could be electric, and the power source could be fusion.

With electric vehicles, you reach the problem of fuel weight. There is simply no realistic battery chemistry that comes close to the specific energy of oil-based fuels (J/kg). Gasoline (oxidation) is at 46MJ/kg, while a Li-Ion battery has at best ~0.9MJ/kg or so. Even a Zn-Air battery has a theoretical maximum specific energy of ~5MJ/kg, an order of magnitude less than gasoline oxidation.

You need huge increases in engine efficiency to make up for the extra weight. This is the reason why there are no electric cargo transporters so far - you may not care so much if your personal car is heavier, but a truck or cargo ship definitely cares.

Edit: Perhaps a car-sized fusion power generator is possible in some far future technology, but we are enormously far from that. At a minimum, it would require achieving fusion with materials that don't generate neutrons as a by-product, as those are enormously radioactive, and very hard to shield (read: have to be bulky). Things like deuterium-deuterium fusion are far out of reach at the moment, requiring much higher temperatures than we can currently achieve.

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#394

Post by jallen_dot_dev » Mon, May 09, 2022, 3:41 PM UTC

UncleMeat wrote: post #390

jallen_dot_dev wrote: post #344

Earlier quoted context omitted.

> It wasn’t orange juice at all, or any type of fruit juice. It was green juice. This is a distinction without a difference. It doesn't matter what the juice is called. It doesn't change the fact that it's idiotic to pay hundreds of dollars for a machine that just squeezes bags of fruits and vegetables, and needs an Internet connection to ensure you're locked in to only squeezing the company's pricy bags.

Those criticisms are all valid. The "juice is sugary and terrible for you" criticism is much less valid, since the premise was to juice vegetables.

"Green juice" is fruits and vegetables, FYI. Look at their marketing material. The bags listed the ingredients on the front and they included things like apple and pineapple.

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#395

Post by tanjtanjtanj » Mon, May 09, 2022, 4:35 PM UTC

hn_throwaway_99 wrote: post #334

FredPret wrote: post #219

Earlier quoted context omitted.

Japan and the US got into a trade war; it’s a special situation for them. Absent getting a bloody nose from an economic giant, they would have done well

> Absent getting a bloody nose from an economic giant, they would have done well I don't know any economic historian with expertise in Japan who believes that. Their bubble basically puts all other bubbles to shame. The land under the Imperial Palace really was worth more than all the real estate in California at the peak. Japan was destined to have an epic crash of equal proportions to the size of their bubble, any…

The bubble reached evaluations virtually impossible to meet, true, but the US torpedoing the largest semiconductor and electronics company in the world certainly was a contributing factor.

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#396

Post by kmonsen » Mon, May 09, 2022, 5:27 PM UTC

landemva wrote: post #183

kmonsen wrote: post #138

Earlier quoted context omitted.

Right, so the theory is that in good times you put on the brakes so there is something in the tank you can spend during bad times. Spending can take many forms, but the traditional ones are lower interest rates and tax cuts. The issue is that we lowered taxes significantly in the middle of good times. It's like feeding ice cream to kids already on a sugar high. There is no room to lower taxes anymore as we are alread…

Biden raised taxes. Decades of deficit spending demonstrate the feds can print adequate amounts of fiat currency, and issue debt, to continue to bail out the banksters, bail out foreign cruise line owners, and attempt to police the world and police outer space. USA could drop the federal personal income tax and continue on with the charade.

Can you be specific here? Which taxes has Biden raised (not proposed to raise)?

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#397

Post by kmonsen » Mon, May 09, 2022, 5:28 PM UTC

galaxyLogic wrote: post #185

kmonsen wrote: post #138

Earlier quoted context omitted.

Right, so the theory is that in good times you put on the brakes so there is something in the tank you can spend during bad times. Spending can take many forms, but the traditional ones are lower interest rates and tax cuts. The issue is that we lowered taxes significantly in the middle of good times. It's like feeding ice cream to kids already on a sugar high. There is no room to lower taxes anymore as we are alread…

Tax-cuts to the rich meant they had more money to invest in stock-market. And the tax-cuts to the corporations meant they made more profits which made them a more attractive target for stock-investors. Both effects meant the stock-market went higher and higher. And so here we are stock market doesn't seem to be going up because there are no new tax-cuts to the rich. There is inflation which is bad for the poor people…

I think, even without hindsight, that I could have done a better job for the economy than the previous president. Biden? Probably not, he has not done much yet. He also does not have large enough majorities to do anything as any tax increases will probably be blocked by the more conservative members of his party.

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#398

Post by scrivna » Mon, May 09, 2022, 6:56 PM UTC

digitalnatives wrote: post #186

scrivna wrote: post #120

Earlier quoted context omitted.

The UK is at more or less the same price as it was in 2000. France same as 2008. Meanwhile SPY is up 2.75x in that period. The US seems to be the anomaly. Value doesn’t always go higher. Maybe the USA is special, maybe not.

SPY is differently weighted than for example FTSE. Most indexes do not factor in dividends, if you look at the total return data where dividends are reinvested you will see there are gains in Europe, but less than the US.

Thanks, I hadn’t realised the “obvious” indexes were measuring different things

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#399

Post by scrivna » Mon, May 09, 2022, 7:04 PM UTC

scrivna wrote: post #120

rubidium wrote: post #100

Earlier quoted context omitted.

Yea so buy land if you’re so paranoid about becoming Japan. It’s an island nation with a very unique history. Not a great counterpoint to current US and global economics.

The UK is at more or less the same price as it was in 2000. France same as 2008. Meanwhile SPY is up 2.75x in that period. The US seems to be the anomaly. Value doesn’t always go higher. Maybe the USA is special, maybe not.

Thanks for pointing out dividend adjustments work differently on some indexes

Adjusted for dividends since 2012

VUKE - Vanguard UK 100 up 100% VUSA - Vanguard S&P500 up 350%

Re: When buying the dip doesn’t work: An analysis of the dot-com crash

#400

Post by mythrwy » Mon, May 09, 2022, 8:21 PM UTC

5350-uiop-1130 wrote: post #387

tasuki wrote: post #208

Earlier quoted context omitted.

> I [...] feel like we no longer follow any kind of logic after 2008, we totally detached from reality. What does it mean we have detached from reality? That valuations are not what they should be? What exactly should they be then? Who should be deciding these things? And a bonus question: Why do you think the current valuations are what they are?

No value anymore, only speculation. houses for sale getting 30+ bids 200k over asking, buyers waiving all contingencies including appraisal gaps and inspections some houses going for $400k+ over asking EV companies valued at billions of dollars with retail tripping over themselves to buy SPACs before the SPACs even announce what company is merging with them there was no repurcussion to the 2008 crimes. have been inge…

"Fake it till you make It" implies when you make it, stop faking it.

We apparently didn't "make it" enough so had to keep faking after 2008. Now, we apparently think we can live on fake forever but the universe will likely not oblige.

Look at the world. The massive amount of people coming online. The pressure on resources this causes. The diminishing low hanging fruit (oil, water, fertilizer etc). The democratization of knowledge around the globe leading to technical talent in places besides the West and their close acolytes. The broken nature of Western BigCos many of which are one step above Soviet factories at this point in terms of actual efficiency, worker buy in and productive honesty.

I don't know what happens from here, but do believe is we are at the cusp of a radical paradigm shift over the next decade. The next 100 years in the West don't look like the last 100 in which Western companies and their captive governments ran the globe unchallenged.

Maybe I'm a cynic and a pessimist but have zero desire to invest in indexes of ossified Western big company stocks at the moment. Their paper value (in my mind) generally doesn't support their true value and potential earnings going forward. Now, there are no doubt some winners in the bunch and when things settle they are worth picking through. The US still has a lot of potential but so much faking it backed up with regime change military/intelligence ops instead of encouraging productivity and innovation has to be sorted out first to give a stable platform for growth again. We have much further to fall in my opinion before stability is achieved, and I'm not tossing dice in expectation of a reward on that right now. And that includes things like the obscene housing ponzi. It has to wash out and return to a stable base.

Other people might feel differently and they might be right. I thought the same things in 2006 and people with more faith made a lot of money but eventually reality catches up, and perhaps this decade is that time. I'm not a person to bet it isn't.