I needed a vacation from posting here. It's was the right thing to do for me. Others have taken a break and came back. So no big deal.

When I felt like posting again I couldn't remember my login info. So I had to create a new account, but I didn't want to look like I was trying to pull the wool over people's eyes. So I used a similar name. I guess I could have used highnote1, but highernote seemed like it fit better given the circumstances.

Mainly, I had some used racing books I wanted to sell. Plus I wanted to see if I could get some PA members to beta test my new website that functions like stock market / betting exchange where buyers and sellers can bid on products for sale. But I have no money to advertise since my work completely disappeared two weeks ago and I don't see it coming back until May at the earliest and that might be wishful thinking.

I also missed posting in the stock market section. Several years ago I suggested that Mike create a stock market section. It is one section I really enjoy reading and posting in. So far it has been fairly non-partisan, politically-speaking.

I enjoyed posting on the political topics, but then it became no fun because there is too much vitriol. It isn't easy to have a reasonable conversation. It turns partisan quickly and eventually people resort to name calling. I tend to be a liberal libertarian so no one on either side likes what I have to say. LOL So I decided to take a break from it all and my new website was the result. I was a lot more productive when I wasn't posting here.

And now I've just spend 5 minutes explaining myself. :D

That wasn't too bad of a post.

I quoted Zweig where he said there are three crucial conditions for a bear market:

1. Extreme deflation. This is not present in 2019, but the fed just cut rates. Perhaps they fear deflation because deflation is what happened during the great depression?

2. PE ratios of 18 or above. The current PE of the S&P is around 21 [and falling], which Zweig says is bearish. However, he says the exception is when profits are low (causing high PEs) because of a business downturn. This was the case in 2016 with poor earnings when this paper was written, but it may also be true in August of 2019.

3. Inverted yield curve. An inverted yield curve last occurred in early August of 2008."
---------------

So fast forward to March 2020.

1. We have not seen extreme deflation, yet, but we might. Look at oil prices. Look at employment. When people have no money all the inventory sits in warehouses. If companies want to move that inventory they will have to lower prices on the products. That means they make less and have less to spend on new inventory and so on and it becomes a vicious cycle until we enter a depression. That's why the gov needs to inject massive amounts of cash into the little people's pockets. They government should also go on a massive building program like the New Deal. That's what got us out of the Great Depression. Maybe the New Green Deal this time around? The Great Depression also brought us WWII due to the rise of nationalism in Europe. And now England has left the EU. The EU was created to avoid WWIII. But this can be discussed in the political section of PA -- although politics is economics.

2. The PE Ratio of the SP500 is around 18.50 and has been falling. But the E in PE is falling that's why the PE Ratio is getting higher -- there is a major business downturn.

3. The Yield Curve has been inverted on and off over the past year. It is not inverted today but it is trending towards zero. It could go negative and invert.

So the gazillion dollar question is what will be the effects of this pandemic on the economy? Will it turn into another Great Depression? Will it bring war? The Spanish Flu is said to have helped bring WWI to an end. So maybe CV19 will prevent a war from happening. It's hard to fight a war when everyone is sick.

http://ww1centenary.oucs.ox.ac.uk/bo...rst-world-war/

Still NOT totally baked in yet...

Fla. just announced a shutdown...and EVEN bigger news...but under the radar...Shanghai....just announced shut-downs :rolleyes:....thought the Chinese were done with this...like you could trust them...guess not...promise you this will show up in the markets as well...

Agreed...what else can one say... :rant: :puke:

I can say this....There's a time to own and a time to be in cash....What time do you think this is?

It's like betting horses. The favorite at 5/2 might be a terrible bet, but at 10/1 is a bargain.

Same with the stock market. It depends on the stock and the price.

It's probably not a good time to own Boeing!

Not all stocks are going down in value, but even stocks that are going up seem risky.

Like I wrote earlier, profit is the reward for taking risk, but also a fool and his money are soon parted.

Buy when there's blood in the streets, but the market can stay irrational longer than you can stay solvent.

It's like yin and yang. A time to live. A time die. A time to love. A time to hate.

A tale of two cities... It was the best of times. It was the worst of times.

The market is schizophrenic right now. Cash is the safest bet, but fortunes were made after the stock market crash of 1929 when people bought great companies for pennies on the dollar.

When everyone thinks it's time to be in cash, that's definitely the time to LOAD UP.

A wise man once suggested that we shouldn't speak unless we could improve on silence. I don't know why this post reminded me of that...:)

I'm struggling to understand the market. The futures are up tonight as I write this, but the market could go down tomorrow.

Will silence provide deeper understanding?

We have all these old Wall Street maxims to draw from, but they are contradictory. Which one do you follow?

I guess my previous post was a long way of saying I have never been more unsure of what the **** will happen tomorrow. :confused:

I can't expect help from well-known maxims when my money is on the line. I listen only to myself...since it's I who will be asked to face the consequences of my actions. Maxims are always contradictory, no matter what the topic of discussion is. "Fortune favors the bold"...the maxim tells us...while also informing us to "never put all our eggs in one basket". These may be cute soundbites...but they impress only in retrospect, IMO.

there is no such thing as "safe" in any market, and that does include CASH.

some day you are going to see the Dow at 100,000. when it gets there, and i promise it will, the money or cash that you will be able to take out of that market will not buy you as much as when the Dow was 1000.

Buffett said put all your eggs in one basket and then keep your eyes on that basket.

Buffett also said why don't we get drunk and screw.

Oh wait. That's a different Buffett, but maybe a good maxim for these trying times. Too bad all the bars are closed.

I don't need to know what's going to happen tomorrow or the next day.

I only need to witness what is happening now and make my decision based off of that...what better way to make a bet or an investment then with up to the second information? It's like the computer teams at the track who have the "super secret" last second pool numbers at their disposal...

That makes sense because you have gotten good at it.

I've always specialized in hedging and using models to make bets like the direction of wheat futures over the next 30 days. So it would take me a while to learn techniques for making short term trades.

I tried FX years ago, but it was too much like playing online poker or making Dr. Z show bets -- fun for a while, but boring. Maybe I just needed to bet more money? The greater the stakes the more excitement. Problem is, I don't like to lose.

But I understand where you're coming from.

First-time weekly jobless claims totaled 6.7 mm today, on top of the 3.3 mm from last week. Using those numbers and the most recent data, the unemployment rate is now around 10%.* Unfortunately, it will get much worse, as I'd expect another 5 mm to 7 mm in first-time claims next week and more after that.

*The official unemployment rate is not calc'd using the weekly claims data. I'm just using the data as a very rough proxy.