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Market Moves Suggest a Recession Is Unavoidable

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Re: Market Moves Suggest a Recession Is Unavoidable

#81
post #39

Earlier quoted context omitted.

Inflation adjusted price of gold is down almost 50% from 1980: https://www.macrotrends.net/1333/historical-gold-prices-100-...

How many 1980 investments are at fifty percent or better today?

Since 1980, after adjusting for inflation Gold lost 50%, the S&P 500 is up 600%, or 1700% with reinvesting dividends in the S&P 500.

Re: Market Moves Suggest a Recession Is Unavoidable

#82

Recessions are a necessary part of the business cycle. A lot of people would argue that global central banks have gone too far trying to avoid a recession and thus the next recession will be particularly brutal. Like laws designed to encourage forest growth, when the fire eventually comes it burns far brighter than the fire that burns in a forest left alone.

those laws (actually policies, I think) are meant to keep homes and other property from burning, not to encourage forest growth. wildfire suppression is rarely practiced in true wilderness areas in the US

Re: Market Moves Suggest a Recession Is Unavoidable

#83

If this is true, where is the best place to invest 10k-100k USD today?

I'm playing the cannabis market right now and i'm bleeding. not just because of the slow growth of the canna industry, but the fear in Trumps trade wars and volatility in commodities is affecting every asset class. Honestly, I would keep my hard cold cash. sit on it until the opportunity arises.

Maybe I am ignorant, but how does a trade war affect cannabis stocks? Is there some China connection I am missing?

Re: Market Moves Suggest a Recession Is Unavoidable

#84

Earlier quoted context omitted.

if you think the market will go down you should short it...

I'm pretty ignorant here, how do you short "the market"?

You can do options, futures, short individual stocks, or even buy ETFs that take an inverse position.

As someone else said, if you have to ask this question it's something to be cautious about doing. But, you have to start somewhere so good luck.

Re: Market Moves Suggest a Recession Is Unavoidable

#85

Things that keep me up at night as a software contractor/freelancer: if there's a recession, are contractors the first to go? One counter-argument is that contractors can be a cheaper way for companies to build products (since it's not full time), which might mean companies favor contractors. On the other hand, companies who are reluctant to lay off full-time staff may start by canceling contract relationships.

Ultimately yes, as a contractor your continued employment in financially difficult times is going to be a hard sell. Of course, you could always take a permanent position for a time if that would give you more of a sense of security. Or, you could fall back on the additional savings you've been able to make as a contractor, that higher rem being the benefit of the hedge you were making in the first place.

That said, I've seen companies shed permies over contractors in difficult times, because if you form the view that said difficult times will stick around for a while, the permies look worse as aliability/drain on your projections than having contractors which, although they are higher cost, can be shed trivially. Depends on location though, areas with stronger protections against letting go of permanent employees are the ones where organisations see those same permies as more of a long-term liability. In right-to-work states, for example, it's just as easy to shed either group.

Re: Market Moves Suggest a Recession Is Unavoidable

#86

If you could know a recession was inevitable some time soon from publicly available information then that recession wouldn't happen in the predicted time frame. Everybody would see it coming, take their money out of the market, and it would happen instantly.

That would assume everybody can interpret the information correctly and make an unemotional decision regarding their investments. In reality, everyone wants the party to go on indefinitely.

Re: Market Moves Suggest a Recession Is Unavoidable

#87

If you could know a recession was inevitable some time soon from publicly available information then that recession wouldn't happen in the predicted time frame. Everybody would see it coming, take their money out of the market, and it would happen instantly.

The author said as much himself:

> Yet, I wonder if it is possible to have a recession when so many people expect one. The worst recessions are the ones that people don’t see coming.

Re: Market Moves Suggest a Recession Is Unavoidable

#88
post #63

Earlier quoted context omitted.

A handful of IPOs won't stave off a recession. (It's entirely possible to cancel an IPO, too.) If I were a big pre-IPO company, I'd probably want to go IPO before the recession, in order to get operating capital to survive it.

A few tech IPOs does not make a strong stock market. Seems a bit silly to judge market health on tech having a few IPOs next year

I'm not, but its one of the things I track. A mixture of unemployment, yield curve us2y10y spread, deal activity are all things I look for to signal the end of a cycle. Tomorrow's job report will be interesting, but given all the other indicators I still think we're looking at a sideways to up market next year. Caveat being the risk of a recession elsewhere in the world and the contagion effect.

Re: Market Moves Suggest a Recession Is Unavoidable

#89
post #46

Earlier quoted context omitted.

What would be the best way to do this? Is there an index fund or something that is based on shorts? Sorry for the lack of knowledge.

there's inverse ETF's. SPXS is a leveraged "bear fund" that gains value as the S&P500 decreases in value. SPXS is particular will move 3X the movement of the S&P500 so a loss of 1% in the market is a gain of 3% in SPXS. SPXS has been an awful fund to hold since 2009.

Be careful with leveraged ETFs because of decay. They are really only good to hold short periods.

https://seekingalpha.com/article/1864191-what-you-need-to-kn...

Re: Market Moves Suggest a Recession Is Unavoidable

#90

Earlier quoted context omitted.

How many 1980 investments are at fifty percent or better today?

Since 1980, after adjusting for inflation Gold lost 50%, the S&P 500 is up 600%, or 1700% with reinvesting dividends in the S&P 500.

Completely beside the point. The question was safety, not potential profitability.

Also, please paint the full picture: How many percent of all 1980 investments retain halt their value or more today? My first guess would be: A small minority.

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