Economy crash =/= stock market crash?

Zola.

A broken clock is right twice a day. 

shortseller09

adindas said:

Also, normally Friday is not a good day for the stock marker as the traders especially with leverage tend to close their position to avoid weekend fees.

Utter nonsense.

adindas

shortseller09 said:

adindas said:

Also, normally Friday is not a good day for the stock marker as the traders especially with leverage tend to close their position to avoid weekend fees.

Utter nonsense.

Friday in the closing hours.

How much weekend fees did a trader pay during the weekend without being able to trade During the weekend ? Dead Money !!!

Sensible Trader especially with leverage will avoid Dead Money if they still could without incurring any loss!!

Also for weekly option traders, they will normally expire every week, generally at market close on Fridays.

shortseller09

adindas said:

Friday in the closing hours . 

How much weekend fees did a trader pay during the weekend without being able to trade During the weekend ? Dead Money !!!

Sensible Trader especially with leverage will avoid Dead Money if they still could without incurring any loss!!

So when you say Friday is not a good day, what do you mean? Are you presuming all traders are long?

Type_45

I'm watching with keen interest to see when the average investor realises we are at the beginning stages of a global debt default and a hard-landing recession.

Zola.

The US defaulted already, back in 1971
When you have a monopoly on violence i guess you can just print monopoly money for the foreseeable and paper over the cracks, letting future generations pick up the pieces of the fiat ponzi...  

adindas

shortseller09 said:

adindas said:

Friday in the closing hours . 

How much weekend fees did a trader pay during the weekend without being able to trade During the weekend ? Dead Money !!!

Sensible Trader especially with leverage will avoid Dead Money if they still could without incurring any loss!!

So when you say Friday is not a good day, what do you mean? Are you presuming all traders are long?

In the theory this is known as the weekend effect. Of course this is just a general pattern not necessarily accurate 100% all the time.

For that reason normally Monday at the market opening is a good time to buy stock (go long) following the drop in Friday market Closing price. The impact is magnified if there are holidays before or following weekend in a row.

https://www.investopedia.com/terms/w/weekendeffect.asp

Type_45

Zola. said:

The US defaulted already, back in 1971
When you have a monopoly on violence i guess you can just print monopoly money for the foreseeable and paper over the cracks, letting future generations pick up the pieces of the fiat ponzi...  

And that was the beginning of the end.

Type_45

Nancy Pelosi has bet on big tech stock, apparently. What's the bet the CPI print will be lower than expected when it's released shortly.

Type_45

adindas said:

bd10 said:

Type_45 said:

bd10 said:

I'll bet on policy mistake. Fed's hand is forced, inflation is getting political and not "just" an economic issue. Baseline assumption: too aggressive tightening, accepting recession in the process. Wouldn't be surprised if Fed would accept that to reign inflation in a bit. Forward Libors are lower from summer next year. Would not suggest that this inversion will lead to a recession, but market's just expecting some easing. And this stop-start I fear will catch many out. Add to that, the Fed put is nowhere close to current levels. Not a good time to hold long duration assets. So yes, it will be bumpy for quite some time. Hope to be wrong but I think we're in for a real treat: high volatility, equity prices drifting lower in general. Few up-days mistaken for being a turn-around, etc. Some markets perhaps but better (=less negative) than others, bonds a no-go and cash depreciating at maybe 5-7% pa, so where to hide?

Gold? But that price will presumably come down too, so timing it right could be profitable.


Regarding the markets, I was looking at some graphs yesterday of bear markets of the past. They suck money in from the sidelines with promising rallies. Sometimes the rallies will be 20%+. Only to fall even further. 

"The job of a bear market is to take as much money as possible" - Someone on Twitter.

Problem with gold is its relationship to the real yield and trade weighted Dollar: Gold struggles when real yields rise, adjusted for FX. Pretty stable relationship since GFC. I added some earlier in the year when the inflation persistency and Ukraine war kicked off. Not much, just a bit to cover any tail risks (Putin flying off the handle, stagflation, ...). Gold and Tips for that matter would benefit if real yields fall on the account of inflation. We've got the prospect of policy mistake on one hand and rampant inflation which - yes might come off due to the base effect, but if you me whether RPI, CPI etc is representative? No idea, am looking at my personal rate of inflation, so how to make a good CPI forecast? I can't, no idea.

... historically UBS is well known and quite accurate in predicting CPI in the US. I have posted this before on another thread.

https://fortune.com/2022/04/07/ubs-peak-inflation-march-consumer-price-index-2022/

He got it right that the CPI has peaked @8.5% in March but missed the figure in April (e.g Actual 8.3% vs Predicted 8.0%)

CPI is 8.6%.

UBS were wrong. 

As I said, a minuscule down tick from 8.5% to 8.3% tells us nothing.