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  #31  
Old 01-25-2021, 10:29 PM
roper1 roper1 is offline
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The bubble won't burst until interest rates rise. There's so much sovereign debt globally that rates will stay low until there are enough taxpayers to pay gov't interest obligations. That's a ways out! Money should flow to equities.

A layman's perspective, don't use this but if you do & make money send me a cheque...
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  #32  
Old 01-25-2021, 11:17 PM
Map Maker Map Maker is offline
 
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Bubble won’t burst until everyone is back into the market.
Still a lot of money on the sidelines.
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  #33  
Old 01-26-2021, 10:34 AM
The Elkster The Elkster is offline
 
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Institutional investors may own most of the shares on the market but retail investors can very much move the price. Just look at the recent runup with gamestop and blackberry. Also the acccidental runup in a startup when it was mistaken for another company that elon musk mentioned on twitter. There has been a huge ramp up in short term/retail trading in the last few years with the advent of no fee trading. The start of the pandemic has only made things worse as has the success of Tesla. The price of a stock is set by those actively buying and selling not those who are sitting back and holding no matter the size of those holdings.

Retailers are indeed managing to move the price and not in a good way. Its almost all speculation and not based on underlying value (see Dot Com 1.0). I've monitored the Reddit investing forums for a few years and there is almost a complete irrationality to their thinking. They'll find a company with a small scale good news tech story and create this fantastic narrative of how this thing is going to the moon. Anything with cloud computing, AI, Space is destined for greatness. They never talk profit margins, competition, cost of doing business, fickleness of customers...oh and low interest rates are alway's baked into the reason a massive P/E is very reasonable. Plenty of short trading and short squeeze plays being hatched as well. They are not investing they are in effect gambling and the cumulative effect is significant.

Its pretty scary to watch. I don't know when this will end but it is not going to go well.
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  #34  
Old 01-26-2021, 08:30 PM
Arty Arty is offline
 
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What's really going on here is the launch of hyperinflation. That means, extreme amounts of money (nowadays mostly in terms of debt) chasing the same or less amounts of product and services. It's classic Weimar hyperinflation, well documented.
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For the last few years globally there's been a slowing economy even before the china-virus started to spread. The dot-com crash, 2008 housing crash, 2015/teens crash, and especially the apparent pandemic shock were all dealt with by intense 'money-printing' officially to 'stimulate' the economy, but really to kick the can down the road. Issued largely in terms of debt, which can never be repaid. USD 27 trillion and counting, at least south of the border, and growing exponentially. Our last Minister of Finance Morneau clearly saw it, and he quit. The only way that kind of debt can be dealt with is paying it and/or interest off with new hugely inflated dollars. The smoke screen of a virus pandemic is a wonderful coincidence (maybe) for governments to hide it or distract most of the population from it.
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When lumber and groceries and vehicles and stocks rise 30% or more in a year in a slowing economy, it is not a one-time temporary effect brought on by 'pandemic' fears. If anything, lower activity would drop prices making everything cheaper, not more expensive. But in fact goods and services are not getting more valuable despite being more expensive - the value of money is really dropping like a rock. It won't end anytime soon, or with a soft landing. And few if any 'first world' currencies will be saved as they are all completely interwoven now.
http://thirdparadigm.org/doc/4506088...Money-Dies.pdf

You can bet your bottom dollar that most billionaires and their politicians in power are now re-arranging things to stay that way when the seams come apart. I think it's called 'feudalism'.
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  #35  
Old 01-26-2021, 10:11 PM
Fisherdan Fisherdan is offline
 
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Quote:
Originally Posted by The Elkster View Post
Institutional investors may own most of the shares on the market but retail investors can very much move the price. Just look at the recent runup with gamestop and blackberry. Also the acccidental runup in a startup when it was mistaken for another company that elon musk mentioned on twitter. There has been a huge ramp up in short term/retail trading in the last few years with the advent of no fee trading. The start of the pandemic has only made things worse as has the success of Tesla. The price of a stock is set by those actively buying and selling not those who are sitting back and holding no matter the size of those holdings.

Retailers are indeed managing to move the price and not in a good way. Its almost all speculation and not based on underlying value (see Dot Com 1.0). I've monitored the Reddit investing forums for a few years and there is almost a complete irrationality to their thinking. They'll find a company with a small scale good news tech story and create this fantastic narrative of how this thing is going to the moon. Anything with cloud computing, AI, Space is destined for greatness. They never talk profit margins, competition, cost of doing business, fickleness of customers...oh and low interest rates are alway's baked into the reason a massive P/E is very reasonable. Plenty of short trading and short squeeze plays being hatched as well. They are not investing they are in effect gambling and the cumulative effect is significant.

Its pretty scary to watch. I don't know when this will end but it is not going to go well.
The retail trading is something I’ve noticed too. In the last few months I have been constantly bombarded with ads for no-fee trading. It’s non-stop.

I think there is an addictive quality to it as well. My Dad, who is 77 and has more than enough savings, is basically all in stocks now. This is how he spends his retirement time.
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  #36  
Old 01-27-2021, 12:58 AM
Drewski Canuck Drewski Canuck is offline
 
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The idea of hyper inflation as a result of increased money supply chasing the same bundle of goods is a possible analysis.

But what the money printing by Governments is doing is getting money into people's hands to pay debt that has been incurred. Not money to purchase future goods.

This was the idea of Quantitative easing, that operated in 2009 - 2010. The US Banks were bailed out over the Mortgage defaults that brought down the US Banking system, as well as alot of blue chip auto manufacturers.

The bailout money was eventually repaid and the quantitative easing ended.

The trouble this time is that the debtors are not a few big banks and car makers who will re launch without the burden of debt and Union Pension obligations. The debtors this time around are people who will have to have jobs to pay the taxes to pay the money that was given to them to pay existing and incurred debt, as quantitative easing.

Because of the tax burden now being created as quantitative easing, there will be less and less money for goods to be purchased with in the hands of citizens in the future, if the citizens can ever find well paying jobs to pay the tax burden and support themselves.

So do not worry about hyper inflation from devaluation of the money supply. Worry how in the world the next generation will ever pay off the massive debt we have created. It is their future which will be hobbled by the tax bill in the future. It is their future standard of living that will be crippled by an incredible tax bill we are racking up today.

The World has seen a Nation that suffered under oppressive taxation before, in Post WW I Germany. That debt was the war debt owed to the rest of the world.

What that scenario of currency devaluation and crippling tax burden gave rise to in Post WW I Germany, was extremism, hatred, economic decay, antisemitism, and war.

Drewski
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  #37  
Old 01-27-2021, 08:23 AM
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Thanks for the pdf Arty. Here is another read on great inflations of the past.

https://recision.files.wordpress.com...f-money-24.pdf

There is nothing in economic history that hasn't happened before. But the one constant is that the people pulling the strings always fail to learn from it.
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  #38  
Old 01-27-2021, 04:28 PM
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Quote:
Originally Posted by Map Maker View Post
Bubble won’t burst until everyone is back into the market.
Still a lot of money on the sidelines.
Bubble started leaking today. I still see the market needing to lose 10% to come closer to reality. Once profit taking hits the likes of Tesla...the free for all could see the market down 15%.
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  #39  
Old 01-27-2021, 05:40 PM
Map Maker Map Maker is offline
 
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Originally Posted by Sundancefisher View Post
Bubble started leaking today. I still see the market needing to lose 10% to come closer to reality. Once profit taking hits the likes of Tesla...the free for all could see the market down 15%.
I have a buddy that has been sitting all cash since last March. I call him a “canary in a coal mine” because he would be one of the last holdouts to buy back in. He just bought some Railroad stock on Monday. Lol

I’ve given up long ago on trying to make sense of the market. I just protect what needs to protected and the rest I can play with and have no worries.
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  #40  
Old 01-27-2021, 06:05 PM
fishtank fishtank is offline
 
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Janet Yellen at the Treasury warming up the printing press , what inflation ? will be record profit for the banks .
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  #41  
Old 01-27-2021, 06:10 PM
fishtank fishtank is offline
 
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Quote:
Originally Posted by Map Maker View Post
I have a buddy that has been sitting all cash since last March. I call him a “canary in a coal mine” because he would be one of the last holdouts to buy back in. He just bought some Railroad stock on Monday. Lol

I’ve given up long ago on trying to make sense of the market. I just protect what needs to protected and the rest I can play with and have no worries.
cp is spliting their stock and looks like many years for oil by rail again with the keystone scrapped, warren buffet will make it happen .
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  #42  
Old 01-27-2021, 06:15 PM
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Originally Posted by fishtank View Post
Janet Yellen at the Treasury warming up the printing press , what inflation ? will be record profit for the banks .
Inflation is the dog that doesn't bark.
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  #43  
Old 01-27-2021, 07:42 PM
roper1 roper1 is offline
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cp is spliting their stock and looks like many years for oil by rail again with the keystone scrapped, warren buffet will make it happen .
Yessir. Share splits by legit companies make the shares more accessible to retail investors, and the share price usually continues an upward trend. I've experienced this a few times, most recently the Telus split a few months back. More net stock value today for sure.
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  #44  
Old 01-27-2021, 10:59 PM
Drewski Canuck Drewski Canuck is offline
 
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Share splits do help further run ups in the markets where share valuation gets too expensive for a block trade of 100 shares.

Where a Company has been buying back shares, or holds significant shares in treasury, a share split also helps fund Executive Compensation by allowing the Company to distribute shares as bonuses to upper management while still having ample shares on hand.

Many Companies keep their key employees with "Golden Handcuffs", meaning share options that vest after 3 years. So if you want those shares, you have to stick around year to year to get the shares promised years earlier.

Needless to say, if there are alot of shares vesting, you have to have the shares on hand to deliver.

That is another example of how the Retail Investors get the shaft over and over again. The Board, CEO, CFO, EVPs, VPs, and Managers get piles of promises for free, and further dilute the share pool in the marketplace.

Drewski
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  #45  
Old 01-27-2021, 11:03 PM
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Quote:
Originally Posted by Map Maker View Post
I have a buddy that has been sitting all cash since last March. I call him a “canary in a coal mine” because he would be one of the last holdouts to buy back in. He just bought some Railroad stock on Monday. Lol

I’ve given up long ago on trying to make sense of the market. I just protect what needs to protected and the rest I can play with and have no worries.
So...Thursday Jan 27...

Who wants to lay a guess down as to what will happen tomorrow.

I’m going to predict down 3%
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  #46  
Old 01-28-2021, 08:14 AM
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From the GME thread.

"I saw this stock back in Oct when it was at $10 when the founder of Chewy came on board. Surprisingly it was a tweet from a fantasy football analyst I follow. I know zero about stock trading so I just passed on by."

Not to pick on Tbiddy, but this is what you see in bubbles.
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  #47  
Old 01-28-2021, 08:37 AM
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Originally Posted by bdub View Post
From the GME thread.

"I saw this stock back in Oct when it was at $10 when the founder of Chewy came on board. Surprisingly it was a tweet from a fantasy football analyst I follow. I know zero about stock trading so I just passed on by."

Not to pick on Tbiddy, but this is what you see in bubbles.
Yup. Today could be a dead gopher bounce with a few people not believing a correction is coming but one is coming soon.
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  #48  
Old 01-28-2021, 09:00 AM
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Quote:
Originally Posted by Sundancefisher View Post
Yup. Today could be a dead gopher bounce with a few people not believing a correction is coming but one is coming soon.
I don't think the entire stock market is in a bubble. Certain sectors and markets are in bubble land. Others are relatively cheap. Bonds, at rates where they are, seem to be the biggest and most dangerous bubble right now IMHO.
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