Tesla Investor's General Macroeconomic / Market Discussion

[GoTslaGo]

Yes it's a very seasonal measure. I'm applying it here because for the first time in over 2 years we've had 2 consecutive down months (note Feb was revised downward). Normally this measure recovers sharply in Feb, this year not so much, and it's contradicted sharply by the consumer confidence levels. That contrast can be indicative of lagging out of phase measures that tend to flag leading indications of precaution of a correction. Couple that with interest rate data and warrants yellow flag

Here is time frame over more than a year so you can see the 'normal' seasonal recovery vs this year.
View attachment 223865

Thanks!

 

[GoTslaGo]

Interesting development in N.Korea. Fuel supplies are low/being hoarded. Not sure what this means. Chinese govnt restricting supply? N.Korean hoarding for possible conflict?

Pyongyang drivers scramble as gas stations limit services
Pyongyang drivers scramble as gas stations limit services

Washington Post - 12h ago


PYONGYANG, North Korea - Car users in Pyongyang are scrambling to fill up their tanks as gas stations begin limiting services or even closing amid concerns of a spreading shortage.

Quote from the article:

But spokesman Lu Kang gave an ambiguous response when asked if China was restricting fuel deliveries.

“As for what kind of policy China is taking, I think you should listen to the authoritative remarks or statements of the Chinese government,” he said, without elaborating on what those remarks or statements are. “For the remarks made by certain people or circulated online, it is up to you if you want to take them as references.”

End quote.

 

[kenliles]

An additional cautionary post here.
Double topping and new record of Margin Debt in the markets. It's become dangerously decoupled from Real market value.
Please note:
This is not meant to dissuade TSLA investment - As I've said before and repeating- not a good time to be underinvested in TSLA and my core stock positioned nearly tripled in past recent months-- that said-
This is meant to put some cautionary flags for HOW you make that investment. And how you might hold through unknown events of a long term.

Margin debt is not a strong predictor of future market/economy direction. But it does show you a measure of the risk currently spring-wound into the market. So it can indicate it's expected reaction to events or downturns - the market when so leveraged will react sharply to those events if and when they occur.
Make your own judgements of that risk against current backdrops of US/World social-political-economic states

If you believe TSLA to be an excellent long term investment-
Are you positioned to weather such possibilities in your portfolio and life? Match those individual conditions to the proper risk equation - otherwise you may find yourself un-wantingly force out

Please be careful out there-

 

[Intl Professor]

To adumbrate your caution, a superficial correlation between relief at the French voting outcome today should show the sensitivity of the market to distant yet important macro events, and that may change more as the day progresses!!

 

[Ocelot]

To adumbrate your caution, a superficial correlation between relief at the French voting outcome today should show the sensitivity of the market to distant yet important macro events, and that may yet change more as the day progresses!!

"adumbrate"... and that is why I think you should change Intl to THE professor.
Quick note to say I really aprreciate that graph kenliles. Very interesting. I am a bit surprised (with my superficial knowledge of how the market really works mind you) that the margin debt did not "meet" the real growth line in 2007/2008. Makes me think terms like 'correction' are really not that.

 

[kenliles]

Very interesting. I am a bit surprised (with my superficial knowledge of how the market really works mind you) that the margin debt did not "meet" the real growth line in 2007/2008.

It would have- it was getting close (within months); This was the difference in a normal recession and The Great Recession - on the order of a modern day Great Depression. That financial(bank) driven event in mid 2008 dropped the market value so precipitously the margin debt could not unwind fast enough. That said- and to your point, a correction is not always 'corrective' and may only adumbrate

 

[Intl Professor]

I should have thanked you for the charts, even an amateur investor like myself can be concerned about the correlation you show.

By the way, there is an off chance but a possibility the ratcheting up by the Trump Administration of the North Korean situation might have a sudden unwelcome iteration. Already the Chinese are concerned and so I'm sure you would agree and most pundits would, that this complicates their negotiating position with the North. What I'm also worried about as has been discussed on this forum is an accidental military catastrophe but also a slimmer possibility of Trump deliberately ordering a strike, especially if his domestic agenda is frustrated even further which should be expected. We have precedence for presidential action during the Nixon administration when Nixon ordered a world-wide nuclear alert in response to something the Russians did in the Middle East which he did not like.

Many hope that some foolish order would be blocked by either McMaster or the Defense Secretary, but they could be cashiered and replaced with a more compliant appointee. The precedent here in spades again comes from the Nixon administration when at least two Attorneys general were fired until the redoubtable Robert Bork was selected. Then Nixon got his prosecutor fired. I'm old enough to remember Lily Tomlin's classic joke on Laugh In: "I dreamed last night I sculpted the first family in ice cream, and then watched it melt." I hope we don't have to go through that again, unless it is necessitated by such dangerous bumbling of the village's idiot in chief.

 

[Intl Professor]

"adumbrate"... and that is why I think you should change Intl to THE professor.

Thanks, but no thanks. I'm narcissistic enough as it is. Unfortunately I actively use most of my vocabulary in speech and even more in writing since I never had a college English class and wrote better in high school than after an S.B. in engineering at MIT. That is why I was not a good teacher since I don't consider the target audience. That is not a problem here, however, as I know there are lots smarter people, including yourself. Think of it as a way of catching up to you.

 

[Intl Professor]

Today Nate Silver's site has an update on the continuing saga of Republican efforts to eviscerate Obamacare.

Trump’s Health Care Bill Won Over The Freedom Caucus — But Risks Losing Everyone Else

I think he makes a powerful case the next attempt will fail as well. That means Obamacare will persist at least until the next Congress and the Democrats have an issue to campaign on until that time: expansion of Medicare to all or single-payer.

Five thirty eight also addresses the issue of the Wall.

Trump Dropped His Demand To Fund The Wall — That’s Smart Politics which also gives the Democrats another issue in the campaign leading up to 2018: comprehensive and humane immigration reform.

If the Democratic leadership were not an oxymoron in drag it would do more than advocate a common approach to structural reform of the party, a fifty state strategy plus bottom up issue development, the strategy so far revealed. It could at least suggest what might be the policy changes which the majority want as in the two instances above. Structural reform is needed, of course, in both parties. But it is easier to appeal directly to what the masses want in terms of either vague generalities which are effective, like making America great again—who could object to that?—or specific policies tailored to appeal like universal health care or maybe practical and humane immigration policy—say issuing an identity card for any current resident of the United States. (I know there are problems with that, but.... Ask the Pope for a solution. He has already addressed most eloquently the problem posed by global warming, for example.)

In 2017 or 2018 the Democrats might convene a convention before or after the primary season to change the name of the party to either Christian Socialist Party (or something similar) as is the label in many "advanced" countries. I prefer small "c" like "christian Democrats" or "Humane Democrats" which is more ecumenical. (The most conservative person I know—a staunch Catholic— used to say "Christ was the first communist.") Further, with all democratic candidates at the convention preparing an agenda for vote on policy issues such as the aforesaid. I leave to you to speculation on an "Economic Bill of Rights" or "Stopping the Rape of Earth" as additional planks of the platform.

Fire away, either bullets or grapeshot.

 

[Sparky]

Some stray thoughts:
I think the name of the major political parties is less important than the policies voters ascribe to them. I'd like to find some good reading material on the intersection of policy and the anticipated disruption to white-collar jobs from A.I. and robotics. Please post anything you've read that seems cogent and relevant to U.S. and global macro.

Coal miners may have better iconography than lawyers, doctors and engineers but far less political influence when it's those jobs on the line.

The recent law changes affecting internet privacy, when combined with IOT and capable neural models are worth public discussion. Imagine Comcast (or the electric company) not only knows every website you visit but also when you open your fridge, pour a shot of bourbon, take a pill, run your (ahem) vibrator. These data can be encrypted but there's a tension between gov's desire to snoop and people's desire to say "none of your damn business". Apply policy here.

Also, my experience with info-bots has been getting much better. Recently, I was at Home Depot looking for a thermostat. The one I wanted, wasn't on the shelf and then queried the "Customer Service" desk person who was not helpful. Then I logged on to the store website from my phone, searched the item and learned the store had 10+ of those items (and directed me to where in the store to find). It's not long before we'll prefer the robot service over a person since it will be faster, more knowledgeable and more congenial.
More recently, I've had the unfortunate need to engage with an Oncologist for my mother-in-law. For a job that mostly involves informing people about which bad choice they get to make for their health and quality of life, the doc was terrible at disseminating information on benefits, side-effects, life expectancy, cost of one type of care vs another etc etc. I see an opportunity for a "caring", knowledgeable, bot to prescribe tests, diagnose and recommend treatment.
I think in the near future, we'll prefer the robot. What to do about that?

For me it's about the next set of problems and who is thinking of a policy framework to extract the benefits from the disruption while minimizing harmful consequences; and discussing in a way that brings us all along.

A party that spends less time spent reacting to inane tweets and unresolvable culture wars would be attractive to me.
Smart people here. Love to get a reading list.

 

[kenliles]

quick review-
economic macro
GDP Q1 growth sucks- lowest in 3 years
inflation picking up some
bond yield curve holding ok-
House passed 1 week budget funding extension- senate will do same- non-issue as expected
the New Trumpcare proposal swung hard right gathering the (no)Freedom Caucus, losing at least that many from other end of Repub
nada chance
the Tax reform was a list of bullet points only - not even at the proposal level- even so shifts burden to dem states and middle income-
nada chance

World socio-political - still a effin' mess

Overall - holding steady but still trending more risky IMO

Tax shift from bullet point release Wednesday:

reminder- SpaceX launch Sunday
good weekend all--

 

[MitchJi]

If the stock market tanks, taking down Tesla, one strategy would be to short the market.

How effective (reliable) would it be to be long gold instead?

In other words is gold an effective hedge against losing money on TSLA due to a market crash? I have a friend who has an excellent record timing gold. I'm thinking about trading gold to produce a second stream of income and to protect our TSLA portfolio.

 

[Intl Professor]

Tillerson's statement to the UN today has a built in problem. Unless I missed a qualifier he said something to the effect: "If you give us what we want, no missiles or nukes, we'll negotiate directly with you." The Israelis often do the same, especially with Iran or the Palestinians, and the US has in the past with the Soviet Union. The Baruch plan for nuclear disarmament failed in 1946, for example, when the Soviets stalled unless the U.S. gave up its monopoly beforehand. A quick check of Wikipedia revealed opinion is divided as to whether the U.S. was serious at all. "If you give us what we want, then we will negotiate," is a signal we'll never consider you a partner in negotiations, only a conquered victim. That is explained politically as a position popular at home while having the advantage of not giving anything in return while seeming to. The failure of Baruch was a tremendous mistake as we are seeing now with the nuclear issue raised once again by such a responsible government, the Peoples' Republic of Korea.

I remember my grandmother, a cherished soul except for a few racist memories like this, using the term "Indian giver" for someone who would want to take something back. Now the origin of the term was probably due to the fact which is a stain on our white heritage, land ownership. Native Americans must have been extremely puzzled by these barbarians saying one could "own" nature. The Pope has done good work in the encyclical cleaning up the Biblical discussion of dominion. It is to be translated more in the direction of husbanding the bounty of nature in the sense of nurturing it. Late, but great ideas that need, if I dare use the term, adumbrating.

 

[Intl Professor]

The Guardian has an interesting tidbit about a lawsuit in the UK regarding Steele's revelations about Kremlin dirt on Trump. Apparently the "opposition research" connecting Trump and the Russians was shared in unedited detail with British Intelligence. A similar lawsuit against BuzzFeed is underway in the U.S.

UK was given details of alleged contacts between Trump campaign and Moscow

The witches' stew thickens.

 

[Intl Professor]

Here is a more practical and real solution than my dry iceberg fantasy.

A crucial climate mystery is just under our feet

 

[kenliles]

Non-issue as expected

Congress reaches deal to fund the government through September (The Washington Post)

(Moved from accidental post in long term thread, sorry)

 

[neroden]

If the stock market tanks, taking down Tesla, one strategy would be to short the market.

How effective (reliable) would it be to be long gold instead?

It's extremely unreliable. Sometimes crashing stock markets mean gold goes up, sometimes they mean gold goes down.

In other words is gold an effective hedge against losing money on TSLA due to a market crash? I have a friend who has an excellent record timing gold.

That's super unusual. Most people lose money trading gold. It's exceptionally difficult; it's a very unusual market and doesn't behave quite like any other market (not even like silver!)

Go ahead, pick his brains, he probably knows which sort of stock market crash goes with gold going up and which sort goes with gold going down. I certainly don't.

 

[neroden]

Now the origin of the term was probably due to the fact which is a stain on our white heritage, land ownership. Native Americans must have been extremely puzzled by these barbarians saying one could "own" nature.

Native American "land ownership" was in the nature of usufruct (the right to use, within limits of responsible management) and was also typically communal.

The funny thing is, most certainly during the 1600s, and as late as the 1900s, *so was English land ownership*. Land ownership came with inherent responsibilities, was subject to all kinds of communal rights, and "wasting" the land was prohibited. There was a concerted Parliamentary program over the course of several centuries to eliminate the legal responsibilities of landowners in England, and to eliminate communal ownership (starting with the Enclosure Acts). The English understood the Native American concepts of land ownership perfectly well, because they were just like the old English concepts. They knew they were stealing from the Native Americans. But they were stealing from the English people too, so I suppose this sort of theft seemed normal to them.

The Pope has done good work in the encyclical cleaning up the Biblical discussion of dominion. It is to be translated more in the direction of husbanding the bounty of nature in the sense of nurturing it. Late, but great ideas that need, if I dare use the term, adumbrating.

 

[neroden]

Tillerson's statement to the UN today has a built in problem. Unless I missed a qualifier he said something to the effect: "If you give us what we want, no missiles or nukes, we'll negotiate directly with you." The Israelis often do the same, especially with Iran or the Palestinians, and the US has in the past with the Soviet Union.

Oh, yuck. Israel's Netenyahu government is basically considered to be out-of-control untrustworthy lunatics by most of the world, which is why nobody negotiates with them except the conquered & oppressed Palestinians who don't really have a choice. Trying to pull that sort of *sugar* on Iran is a sign of ridiculous arrogance.

Now, the US was already developing a reputation of being run by out-of-control untrustworthy lunatics under GWB... and Trump has increased this reputation... this is only going to add to it.

The Baruch plan for nuclear disarmament failed in 1946, for example, when the Soviets stalled unless the U.S. gave up its monopoly beforehand. A quick check of Wikipedia revealed opinion is divided as to whether the U.S. was serious at all. "If you give us what we want, then we will negotiate," is a signal we'll never consider you a partner in negotiations, only a conquered victim. That is explained politically as a position popular at home while having the advantage of not giving anything in return while seeming to.

I don't think anyone who's paying attention considers the Trump approach to North Korea to be serious in any way. I do think he is unlikely to do anything military if China outright tells him not to, though.

We have very little information on the Chinese negotiations with North Korea, beyond random clues about what they've embargoed and what they haven't embargoed. I wish we had more information.

 

[dmckinstry]

I hope we don't have to go through that again, unless it is necessitated by such dangerous bumbling of the village's idiot in chief.

And to think, until now I thought that description applied only to Bush II. Now it looks like by comparison he was a genius.