Get started

Depression

Jerome Powell said he wouldn't save the stock marketIn a 60 minutes interview (I think) the FED chair said the stock market could go down. I don't want to rewatch the whole thing, and I can't find the quotes on the internet because you know that's not something important at all. It's in there. He said "yes, you can lose your money" and more. Not saying his word is to be trusted but he hasn't planned to "save" the stock market. Meanwhile, retail bullishness is at all time high, on the FED site the question "will stocks go up" has a record number of "yes". Suckers will buy "cheap", as they always do, but they do not have enough weight to drive the price. A part of money printed out of thin air ends up in the stock market this is true. During QE 1-4 a correlation of 98% has been found: 98% of the time the FED bought bonds, the stock market went up. And retail that gets checks, "free" money, is going to do the "safe thing" and the "right thing", the "rational thing", what they have been told to do, and invest it in "safe productive companies that always go up". They can't really save their "money" (currency), the option they have is what they have heard over and over "beautiful dividend paying productive business that always go up because it always have value because it always go up". Yes, alot of money will flow into the stock market. Here is the thing: The stock market will only go up, if the US DOLLAR falls faster than the stock market does. In real money term it will fall 100%. In $ terms, sure, it can go up. Who cares about something priced in ponzi currency? The whole bull market driver, for the entire bull market, and by very far, were corporate buybacks (company profits don't get taxed until they sell shares if they use that profit to buy shares). Now almost all companies are underwater and need bailouts. Buybacks have slowed down in 2019 and now I strongly believe those will strongly decline. I expect them (at least) to be at their lowest in 10 years. Foreign countries might want to dump both their US equities, and their US dollars (currency or treasuries) also. China was super mad and have been reducing their usd exposure, but they still own over a trillion. Boy will they be pissed when the USA inflate their debt away. I think that's the end of the usd reserve currency. 2020 was a nice round year for a great depression. Powell got asked in that 60 minutes interview "Will this be called the second great depression in the future" and he froze and looked terrified lololo, then ye of course he said "naaah, there will be a sharp downturn, a violent recession worse than 2008, but we will recover by late 2021" or something like that. During the whole interview he has weird ticks and makes strange faces. I think he is a little worried 😃 This depression will be worse than the 1930s. For foreigner this means we'll get discounts on nice companies (outside of the USA duh). For Americans emmm rip. I want to post a list of countries with average price to earnings, but alot of this info is behind pay walls. I'll just go for something very generic and partly outdated but that's fine don't need perfection, just need to know where to look first. I know the USA and India are so expensive. I think Europe is quite undervalued, and prices are not down falling. I like Africa there is potential to go way up, but this is far more risky I think. I am not going to keep holding euros and dollars that are racing to zero. I need to grow my trading account more but as soon as I have a decent size I need to generate profit (I hate the idea of trading for income but I'll have to) I'm going to want to put some of my money into real assets. Anyone that worked for more than just a few years or maybe I should say anyone that ever worked period should want to save up some of it and keep it in a real asset not a ponzi ran by banks & government that only benefit them. Hey here is the whole Elon Musk quote. Calling social democrats fascists, calling the quarantine stupid, calling out big tech censorship, tearing down the narrative, calling the average dum dum a fool? I'm really liking the new Elon Musk. Real inflation does not just come from a currency supply expanding more than the GDP (amount of goods and services). If the GDP contracts then there is less stuff. If there is less stuff, it becomes more valuable. The US won't starve. They can produce so much food (1 of the reason is how much CO2 we pumped into the atmosphere). In the short term they might have some meat shortage but it's not a huge deal. I really don't think anyone will starve. Powell has clearly said "we just want to print money so small & medium business survive a few months, we are just trying to buy time". So he is not trying to print the country into wealth, like Zimbabwe. But it doesn't matter. This is a ponzi scheme and like every ponzi scheme you need to burn more and more cash to sustain it. You can never stop it without the whole thing collapsing. Plus politicians are never going to want to give back the powers they got, and the public is going to want more "free stuff" "we need a living wage that's all we ask" "we just want the bare minimum to live in human dignity". The US bonds are trash bonds. The country is collapsing from the inside. The US stock market was extremely expensive before the GDP contraction. There is no one to bail them out. Don't look at west europe we got our own problems we ain't going to bailout anyone, plus we became so reliant on the USA... I hope it crashes soon so I can start making money. The USA really holding everything back zzzzz. Stupid modern portfolio theory. This will either be called a great depression, or the greatest depression, or the deep depression. Or maybe they invent a new worse word. "Bipolar psychosis dysphoric disorder". I wish the bureaucrats didn't try to "help". Oh well at least I'll get to say "told you so".
TVC:DJIShort
by MrRenev
13
SH, cleared for take off, runway Covid2020, no delayEquities are about to burst, I am very bullish SH. USA leadership has spectacularly fumbled the ball in responding to covid. Hot spots are developing as Trump is hellbent on reopening the economy. This will set the USA up for a massive 2nd wave this fall, unfortunately. This will ensure business remains crippled, if not completely shuttered till spring 2021. Trump doesn't realize that 'the economy' isn't an abstract thing--it's comprised of individuals whose health under-girds all else. The general health, safety, and well being of the country is our chief capital stock. Queue Abraham Maslow: Meet basic health and safety needs 1st. Insane R:R available Targeting $75-100 to begin
AMEX:SHLong
by scottybfx
1
SPY Long Channel identified Or How I Learned to Stop Shorting and Love the Fed. This channel will be the range the SPY travels within for May, until a breakout on either side. A breakdown would likely mean consolidation, but NOT a bearish signal unless carried by momentum, which seems gone now that the Fed is buying ETFs. There are plenty of support levels to keep the SPY sideways rather than down. On the other hand, a break upwards out of the channel would represent a breakout back to last year levels. I doubt this will happen. At some point the trend must end, and will have to consolidate, whether that means going sideways for a bit or consolidating to the major levels. Personally, I doubt we can revisit the 220 lows unless wave 2 turns out to be a worse disaster than wave 1. Major Levels: 286, 280, 272, 264. Support: 246, 220 Resistance: 295, 313 "But Jorji! Where are your candles! I thought we were supposed to be trading stocks!" I turned them off because I wanted a clearer picture of the trend, try it for yourself. Please feel free to comment/discuss/critique my charts in the comment section. Always happy to collaborate. tl;dr SPY 300 6/19
AMEX:SPYLong
by Jorji
3
Bulls Don't Get Your Hopes UpRetail is plowing into USO, tech, and US stocks. Even with the "Fed Liquidity", the 1st quarter of 2020 was the largest QoQ contraction in credit conditions EVER. The fundamental economic data is putrid. The worst ever. and REMEMBER, corporate profits peaked in late 2018, which is also when the Russell 2000 entered a bear market. The SPX was saved from crashing by a Fed that slashed interest rates in 2019, but with this biggest global shock we have ever seen and with money supply velocity at ZERO, there's nothing that traditional monetary policy can do for the markets. Markets bounced off of hope and optimism given to them by Mnuchin. Don't trust the administration. Things are about to get UGLY UGLY
SP:SPXShort
by Ludwig_Von_Mises
20
SPX | Fear and HopesThere's a large amount of speculation whether or not the United States will enter into a deep depression; And there's some potential for it. Housing Starts for single family homes has decreased to levels seen in the 1980's, meaning there will be more families moving into multy-family homes; or apartments. Housing asking prices are dropping along with demand shown by multi-sector consumers. The inflation rate hasn't moved, which is good for now, though the interest rate isn't looking so good with the possibility of negative rates. I guess you can say the injection of trillions of dollars by the FED has mitigated the fall, but I'm not even sure this is the beginning. My assumption is that SPX will have a lot more selling pressure than displayed this past week. New highs were lost in two days and the close was lower than the previous candles' close. Personally, I'm longing SH until I can see some fundamental upside for this economy. I speculate a prices being near $1600 before we start to recover from this potential Global Recession.
TVC:SPXShort
by jordvnflows
S&P 500 Rebound SituationThis is a more detailed look at the current crash rebound on the S&P 500. The daily chart with a Fib Retrace box shows we've managed to rebound higher than the 50% fib retrace (2788 on the chart) which was my initial call for a reversal point. If we continue higher, the next fib level up is the 62% retrace which is about 2930, around 2% higher from Friday's close. The NASDAQ 100 (not shown) has incredibly broken over the 62% retrace. This is due to very strong tech stocks like NFLX (at new highs), MSFT, INTC, and insanity stocks like TSLA filled with morons. I'm not exactly sure what tech buyers think the future holds... I guess they see a virus treatment soon followed by a V-shaped recovery to new all time highs? Yet all over the global markets we see record breaking horrors... unbelievable unemployment, small businesses closing, decimated oil prices, ugly bank index, dead airlines/leisure/auto markets, and real estate looking terrible. All this and more is screaming an economy with serious problems ahead, not new all time highs. Most likely the tech buyers aren't thinking anything but are just buying what is going up and betting on further Fed stimulus to offset bad news. I think that will end in tears. The fundamental action of markets is to discover fair value by testing price levels--going up and down seeing what values hold and which don't. So my expectation (which is just a guess like anyone else's), is that despite manipulations from the Fed, there can be no faith in a higher market given the current situation of extreme negatives and unknowns without a retest of previous lows. If the market drops and holds previous lows, then maybe bulls have a point. Until then it's just a bear market rally, amplified by the Fed, sucking in fools and their money to be separated. And once the current bullish frenzy turns, the charts will show an ugly lower high on the indexes, the fear will return, and I wouldn't expect March lows to hold. However, to keep myself from getting too carried away with a bearish view, here's a bullish take (at least for the short term). I've also put the S&P500 priced in gold (the yellow line), which I think is a proxy for a market index with the "Fed shenanigans" removed. This value is still approaching the 38% retrace. In 1930, when the DJIA was priced in gold (along with everything else), the initial rebound from the 1929 crash went as high as the 50% retrace over 6 months or so. So from the point of view of the S&P500 priced in gold, one bullish view might be a bounce to the 50% retrace by the yellow line. We'll see how long the market can continue its extreme ramp higher, but when it finally turns, I suspect the market mood will turn uglier than anyone alive has ever seen it.
SP:SPXShort
by MystryBox
10
Stocks Peaked 20 Years Ago. US Perma-Bulls are Chasing a BubbleIn nominal terms, US stocks have gone higher and higher over the last 20 and 30 years. This is priced in US Dollars. Priced in terms of real money, stable money, the US stock markets and the US real economic growth peaked 20 years ago. Over the last 20 years we've printed a crap-ton of money to paper over the losses and make ourselves feel richer, but it's all been an illusion. A money printing fueled bubble. And the most recent cycle peaked in September of 2018, when the Russell first entered into a bear market and when the gold bull left the train station. In terms of what's happening right now: The Russell is sitting at the top end of its range right underneath major resistance. Without big stock buybacks driving the market there won't be enough buying power to send it to new highs. The Fed can print as much money as it wants but it can't stop a massive global shock. Money velocity is at ZERO. Doesn't matter how much money you print, you can't fix a solvency problem with more liquidity. You can only buy yourself short slivers of time. Its only a matter of time before economy gravity is respected and the global markets, including the US equities, get absolutely cratered.
TVC:RUTShort
by Ludwig_Von_Mises
1
SPX: The Great Depression and Today's Market 1W (Apr. 27)X FORCE GLOBAL ANALYSIS: The Great Depression that took place in 1929, took 10 years to recover, and is still remembered as one of the most devastating events that hit the stock market. Today, the stock market is recovering from a devastating hit caused by a virus outbreak (COVID-19). Governments and banks have worked together, initiating both monetary and fiscal policies to resuscitate the market. However, doomsday theories arise, comparing the current situation to that of 1929. In this analysis, we explore the possibilities of a Depression in 2020. Analysis - First off, we look at the technicals, comparing the Dow Jones Industrial Average in 1929, and the S&P500 in 2020 - Visuals demonstrate a similarity in terms of the general trend - Both charts start off with a parabolic move (not demonstrated above). - Then, a phase of consolidation - marked by the red zone - which represents base 4 of a parabolic move - The first thing to note during this phase is that we see an extended bearish divergence - Prices form higher highs and the Relative Strength Index (RSI) forms lower highs, demonstrating a lack of strength in the bullish trend - After reaching the peak, we see the Moving Average Convergence Divergence (MACD) form a death cross. This death cross marks the beginning of a temporary bearish trend reversal - Then a bounce near the trend line takes place. During the Great Depression, DJI bounced over 50% before continuing to drop. SPX has currently bounced over 30%. - As it bounces, an ascending bearish wedge pattern is formed - As the ascending wedge pattern reaches resistance between the 0.618 and 0.5 FIbonacci resistance zones, a rejection takes place - Prices drop further, and we see a continuation of a downtrend following the descending trend line, marked by the dotted purple trend line. - According to Ray Dalio, one of the most successful hedge fund managers in history, there are debt supercyles - The last debt supercycle ended in 1929, and usually last 50-100 years - Because this crisis was initiated by a viral outbreak, the real economy has also been significantly damaged, with unemployment rates having skyrocketed Counterarguments - Unlike the government and banks back in 1929, we are more prepared for a crisis today. - The US has initiated Quantitative Easing at an unprecedented rate, and the Fed has cut interest rates like never before in history - As biomedical companies heavily invest in medicines and vaccines, we see hope in eradicating the virus. - Since this crisis was triggered by the virus, mass production of a vaccine could immediately end the crisis (driven by bullish anticipations of the future), and possibly take us to all time highs - The doomsday prediction has been a popular argument for years. Ray Dalio has also been taking about the possibility of a debt supercycle since 2016. Market Sentiment: The fear and greed index for the S&P500 Index still points towards fear, despite the huge bounce we have recently witnessed. What We Believe It's impossible to perfectly predict and time the market. Leveraging for maximal positions in the market is definitely not optimal, and so is terminating all positions to catch the bottom. We believe that the trend is your friend. Identifying short, medium, and long term trends is absolutely essential, and choosing the right stocks, with strong fundamentals that can stand the test of time throughout this crisis, is the recipe for success. Trade Safe.
TVC:SPX
by XForceGlobal
12
OIL FUTURES, STORAGE and STRATEGIC PETROLEUM RESERVEFuture prices may be related to the fulfillment of the contract associated to them. In the case of Oil, the Future Contract Specs for WTI can be found here (www.cmegroup.com). So upon the contract Expiration (Last Trade date that can be found here: www.cmegroup.com), you will have to receive the Oil Barrels (1000 per Future purchased as per this contract in this case). This requires storage capacity, and given the current Covid scenario, this has been compromised (read more about this here: www.nytimes.com). It seems that given that the price of the futures are negative, it means that sellers are willing to PAY buyers to take the asset from them... so this might mean that it is cheaper for them to have someone take the oil from them and take care of the storage, than having to do it themselves (having to store more than they can, or even drop production to be able to prevent more supply from compromising current storage capacity and the costs associated with it). I think that Governments and other entities with high storage capacities might stand to benefit from this. They can get paid to take the oil from these suppliers, while also increasing their Oil reserves. In the case of the US, for example, the US has the Strategic Petroleum Reserve (en.wikipedia.org(United_States)), read more here (www.spr.doe.gov). If they acquire the oil barrels now, when things normalize, they will be at an advantage with higher volume supply than others, to sell. They will be able to regulate the Oil market and other markets that depend on it. Will be looking into it as it evolves. Thoughts?
NYMEX:CLK2020
by gotomars
1
NEW GREAT DEPRESSION ?There are two scripts white and pink , the main difference between them is how to consider the final reverse of American market during Great Depression whether in 1932 or in 1941. Concerning fundamental factors , there are 2 main factors pointing to dramatic plunge of US economy. The first factor is obvious , COVID - 19. The second one is zero FED rate, so the great number of American people have not opportunity to refinance their debts and mortgage by which there are congested. During long period of time credit used to be backbone of economic growth in developed countries, when FED rate achieved to zero it means that such system stop performing. Probable targets of current plunge are 2151 , 1411, 670
SP:SPXShort
by BandBInvestment
2