Tesla Investor's General Macroeconomic / Market Discussion

[Intl Professor]

We'll, that didn't take long. Bipartisanship at work.

Trump agrees to fund government, raise debt limit to Dec. 15, Schumer, Pelosi say

Suppose we take the devil's view of the Prez. (Hope for wish fulfillment, of course.)

The press for its own reasons has got this exactly wrong.

‘Trump betrays everyone’: The president has a long record as an unpredictable ally

The Republican leadership in Congress has got this exactly wrong. The problem is their partisanship. Everyone wants bipartisanship, even Trump supporters, and even the Republicans pay lip service to it. But on Obamacare, etc., their instinct is to push their agenda and insist the opposition is playing unfair because of its partisanship. Health care has shown they have not thought through the implications of their dogmatic approach when almost everyone, including the insurance oligopoly, raised alarms.

The advantage of regular order of business is a formal process to weigh opposition and make compromises on legislation. That should be the way forward. If that happens some will claim, not me, Trump was a genius and he's saying it now. Congressional leaders had a chance, let me, the new Diogenes, show you the way with my enlightened art of the deal, he is saying.

Kelly, who is supposed to be a neophyte on policy, should back this approach. Let Congress be Congress on policy. Let it earn its keep by doing its job.

Of course, Rosie O'Grady, or scenario, mumble, mumble.

 

[Rarity]

Comparative advantage is false. I looked at the historical record: there is no empirical evidence supporting the idea that comparative advantage actually exists between nations, and a lot of empirical evidence proving it completely false.

You should love Trump's trade policies then, and especially love Wilbur Ross.

Ricardo's idea is truly, madly, deeply difficult. But it is also utterly true, immensely sophisticated -- and extremely relevant to the modern world.

http://web.mit.edu/krugman/www/ricardo.htm

 

[MitchJi]

Cross posting the first part of this post:

I believe that there is an excellent chance that the market will either have, or start a substantial decline (10%-20% for 2-3 months) by the end of October. Possibly starting as soon as next week. If that happens it will present huge opportunities.

Jesse Livermore:
Livermore continued to make money in the bull markets of the 1920s. In 1929, he noticed market conditions similar to that of the 1907 market. He began shorting various stocks and adding to his positions, and they kept declining in price. When just about everyone in the markets lost money in the Wall Street crash of 1929, Livermore was worth $100 million after his short-selling profits.

Jesse Livermore: The Greatest Trader Who Ever Lived
He returned to New York with what he termed a “fair-sized roll.” Then, on April 16, 1906, he was hit by a premonition. With no warning, he yielded to a strange urge to sell short a thousand shares of Union Pacific railroad—an urge even he admitted he didn’t understand. Two days later, the San Francisco Earthquake hit. and the Union Pacific was decimated; he’d made $250,000 literally overnight.

The reason that he made so much in the market crashes isn't a coincidence. It's because markets never crash up and individual stocks almost never crash up.

That means that if the market has either a substantial correction, or a crash it's a huge opportunity that doesn’t happen very often. The Macro Thread has a lot of excellent discussion about protecting assets, but don't remember seeing anything about taking advantage of the potential opportunity.

 

[Lump]

More records today for those focused on fundamentals instead of "Mass Media News".

 

[Lump]

LOL at the likes of Paul Krugman & company.

$2 trillion man? Market value added since Trump's election win passes milestone

Like it or not, the U.S. stock market has performed exceptionally well since President Donald Trump was elected.

The S&P 500 has added $2.04 trillion in market value since Trump's election last November through Monday, according to Howard Silverblatt, senior Index analyst at S&P Dow Jones Indices. The benchmark rose to a record on Monday and then another in early trading Tuesday.

 

[dmunjal]

LOL at the likes of Paul Krugman & company.

$2 trillion man? Market value added since Trump's election win passes milestone

Like it or not, the U.S. stock market has performed exceptionally well since President Donald Trump was elected.

The S&P 500 has added $2.04 trillion in market value since Trump's election last November through Monday, according to Howard Silverblatt, senior Index analyst at S&P Dow Jones Indices. The benchmark rose to a record on Monday and then another in early trading Tuesday.

I would say it's all based on corporate tax reform. It better come this year.

 

[dmunjal]

I would say it's all based on corporate tax reform. It better come this year.

It looks like it's going to happen.

Gold Drops, USD Pops As Mulvaney/Ryan Signals Tax Plan Coming September 25th | Zero Hedge

 

[ValueAnalyst]

Can you summarize why inflation is still so low in one word?

 

[ValueAnalyst]

I expect a recession to start in 1H19.

 

[kenliles]

Progress in USA Real Median Income:

and more recently, progress in the lower percentiles-
(albeit not enough - and may abate under current administration policy)

 

[kenliles]

and the Great Big Picture:

[Note- correlative with socio-political scene]

 

[dc_h]

Can you summarize why inflation is still so low in one word?

Technology

 

[dc_h]

Progress in USA Real Median Income:
View attachment 247973
View attachment 247971

and more recently, progress in the lower percentiles-
(albeit not enough - and may abate under current administration policy)
View attachment 247972

Lower quartile wage gains have only happened after 5 years of growth, since the 1960's. I'm not worried that tax gains for upper incomes will hurt the poor directly, but that overstimulation of the economy will push the federal reserve to slow the economy. The slow steady growth of the last 8 years has been very sustainable. Any tax breaks to stimulate growth need to encourage more labor force participation.

I'm already seeing cracks in food services, where quality labor shortages tend to show up early. I've advised Econ friends in the past to study this as a leading indicator of full employment and leading inflation indicator. Wage pressure in food services implies that there is limited additional labor to enter the work force.

 

[Starno]

Progress in USA Real Median Income:
View attachment 247973
View attachment 247971

and more recently, progress in the lower percentiles-
(albeit not enough - and may abate under current administration policy)
View attachment 247972

We're in the peak of the economy right now.
A few more quarters, then interest rate will rise until central bank mess up, and it's recession again.

https://www.linkedin.com/pulse/big-...ew_base_post_details;OHSWRE1NTteC+2dj6pcEwA==


https://www.linkedin.com/pulse/central-banks-reversals-signal-end-one-era-beginning-another-dalio/

 

[kenliles]

US Tax reform will enter the macro discussion in coming weeks

Why American Workers Pay Twice as Much in Taxes as Wealthy Investors — Bloomberg
"<
A billionaire investor can pay about the same marginal rate as a $40,000-a-year worker, a fact Warren Buffett has famously lamented.
>"

 

[sundaymorning]

We're in the peak of the economy right now.
A few more quarters, then interest rate will rise until central bank mess up, and it's recession again.

https://www.linkedin.com/pulse/big-picture-ray-dalio/?lipi=urn:liage:d_flagship3_profile_view_base_post_details;OHSWRE1NTteC+2dj6pcEwA==


https://www.linkedin.com/pulse/central-banks-reversals-signal-end-one-era-beginning-another-dalio/

I believe that the Obama era $700 billion infusion of cash to bailout the US economy contributed to this long bull run. Historically, when was the last time we saw these kinds of government measures? Economies around the world from China, to Japan, to Europe are doing the same, infusing $BILLIONS to stimulate the past several years. These infusions have paid off handsomely and I believe will contribute to one of the longest bull market in US history.

One of the biggest tax revenues growing within the US market right now is marijuana, which has also paid off handsomely for states that decided to take advantage of its usage. Peyton Manning once said that his chain of Papa John's restaurants in Denver saw immediate spikes in activity after marijuana was legalized, "I wonder why?" He added.. being from California I remember the governor Davis years when the state was in billions of $dollars worth of debt, I am not seeing the same pattern, as @Lump has pointed out, the S&P has saw $2 trillion of growth since Trump took office. I am not at all concerned about a looming recession, unless more evident "signs" begin to reveal itself.

As for the stock market being at historical highs, it's only natural that most Americans who could no longer afford to buy or own a home, look elsewhere to invest their money, the stock market offers the most logical sense.

 

[dc_h]

We're in the peak of the economy right now.
A few more quarters, then interest rate will rise until central bank mess up, and it's recession again.

https://www.linkedin.com/pulse/big-picture-ray-dalio/?lipi=urn:liage:d_flagship3_profile_view_base_post_details;OHSWRE1NTteC+2dj6pcEwA==


https://www.linkedin.com/pulse/central-banks-reversals-signal-end-one-era-beginning-another-dalio/

This is when the real Keynes would stand up and cut spending or increase taxes. The longer the Fed is on the sidelines the longer the run.

We would post my top five options to plug the deficit and be better prepared for the next recession, but that requires a new thread.

 

[dmunjal]

I believe that the Obama era $700 billion infusion of cash to bailout the US economy contributed to this long bull run. Historically, when was the last time we saw these kinds of government measures? Economies around the world from China, to Japan, to Europe are doing the same, infusing $BILLIONS to stimulate the past several years. These infusions have paid off handsomely and I believe will contribute to one of the longest bull market in US history.

One of the biggest tax revenues growing within the US market right now is marijuana, which has also paid off handsomely for states that decided to take advantage of its usage. Peyton Manning once said that his chain of Papa John's restaurants in Denver saw immediate spikes in activity after marijuana was legalized, "I wonder why?" He added.. being from California I remember the governor Davis years when the state was in billions of $dollars worth of debt, I am not seeing the same pattern, as @Lump has pointed out, the S&P has saw $2 trillion of growth since Trump took office. I am not at all concerned about a looming recession, unless more evident "signs" begin to reveal itself.

As for the stock market being at historical highs, it's only natural that most Americans who could no longer afford to buy or own a home, look elsewhere to invest their money, the stock market offers the most logical sense.

$700B is small potatoes to what the central banks have done with QE. That is trillions. As high as $21T worldwide.

Big Central Bank Assets Jump Fastest in 5 Years to $21 Trillion

 

[AudubonB]

Can you summarize why inflation is still so low in one word?

No.

 

[AudubonB]

Lowwagesandexcessmanufacturingcapacityandlargeserviceemployeepool

is the best I could do....