Tesla Investor's General Macroeconomic / Market Discussion

[Intl Professor]

Congrats to those that didnt listen to Krugman, Summers & the other Liberal blabber heads & invested correctly over the last 12 months, hopefully the Dodgers can bounce back tonight so we can really celebrate along with our record highs.

Please don't give Liberalism a bad rap. All American politicians are self-described free marketeers,* save Bernie Sanders who is the only progressive happy with the moniker "socialist." (There, I was able to type what I cannot say without a knee jerk—socialist. Edit: I do have a tic now.) Liberals trace their origins to the victory of the merchant class over the landed gentry in England in the early to middle 19th century. Our new gentry is the top 10 percent who are classic Liberals an "un-landed gentry." They are quite happy to have a developer and his lackeys run the country. And you haven't seen the end of it yet, although it is beginning, because the worker bees are organizing. Wait until the attack on Mueller goes full on! That won't happen until the tax cut for corporations, at least, is in the bag.

As a certified blabber head, I am long Tsla and was able to buy another 50 shares this year due to a mistake my more free market oriented wealth manager made. He is right, however, to caution by moving us slowly into more cash anticipating the vulnerability of the market to a full-blown kakistocracy. Lest you think me harsh, please answer a question I and many others have. Why does the Federal Office of Emergency Management refuse to show its hurricane disaster plan prepared in other administrations for Puerto Rico but apparently is not ashamed to show it for Hawaii? Just a question. Seeking answers. Sorry, I think, obviously mistakenly, that I am a fact-based blabber head. Nice phrase, by the way. Spiro Adnew had a more alliterative one. "Nattering nabobs of negatism." And you know what happened to that vice-president who continued to receive payoffs in his White House office for favors to contractors during his stint as governor of Maryland.

*See Gary Wills, Nixon Agonistes, for a beautiful history of Liberalism and its core tenet, free markets.

 

[Intl Professor]

As to investing (real important part of your post) it is time to repatriate all those offshore profits and get some corporate tax reform. I don't want to get political but as an investor in many of the companies with offshore profits I admit to my bias about getting that done.

I think Progressives would agree if a stipulation restricted those profits to productive investments in the future of the corporation, not just windfall benefits to the corporation and investors. I am happy that Tsla does not currently show a profit; all is invested in the future. That makes it a GREAT corporation for long-term investors like myself. Of course there is a value to investors in the short-term if profits go up. My concern, as Gretchen Morgenstern has pointed out, some elect to increase dividends or buybacks that are higher than the amount they pay in R&D, say, of new drugs, and she mentions names. That's neglecting value accretion and really is a bribe to shareholders. Of course, on my death, I have advised my wife she should invest in income producing endeavors, after paying off whatever debts we have. So I'm a hypocrite, lest you cast the first stone, though I'm convinced that is not your style.

Dividends could be in the future for Tesla, not too distant, I hope. Then the test might be does it still spend more for investment in R&D? I can't see any diminution occurring near term for probably ten years and I won't live that long.

 

[Lump]

My focus & comments all year have been directed at the Liberal market commentators who totally missed this rally, they predicted a market crash & economic collapse & simply cant admit they were wrong.

I will pass on searching for this FEMA report you are seeking, I believe you are retired so you should have lots of time looking thru bloated Gov. files.

 

[GoTslaGo]

I think Progressives would agree if a stipulation restricted those profits to productive investments in the future of the corporation, not just windfall benefits to the corporation and investors. I am happy that Tsla does not currently show a profit; all is invested in the future. That makes it a GREAT corporation for long-term investors like myself. Of course there is a value to investors in the short-term if profits go up. My concern, as Gretchen Morgenstern has pointed out, some elect to increase dividends or buybacks that are higher than the amount they pay in R&D, say, of new drugs, and she mentions names. That's neglecting value accretion and really is a bribe to shareholders. Of course, on my death, I have advised my wife she should invest in income producing endeavors, after paying off whatever debts we have. So I'm a hypocrite, lest you cast the first stone, though I'm convinced that is not your style.

Dividends could be in the future for Tesla, not too distant, I hope. Then the test might be does it still spend more for investment in R&D? I can't see any diminution occurring near term for probably ten years and I won't live that long.

I doubt Dividends will be showing up anytime soon for Tesla. Too much going on, they need all the capital they can get their hands on to pay back out.

More seasoned investors, please disagree if my following is BS:

I had wondered about income producing endeavors, especially in retirement. Obviously if one has a Pension that’s a no brainer to keep (my folks do, and I’m jealous). The other option are Annuities, but does one really want to give up all that money?

So my thinking is to build a portfolio of low cost mutual bond funds (I use Vanguard) with reinvested dividends for now (as I am still working). My goal is to have these grow so they are generating good monthly income with my ultimate goal to have them producing monthly income in our retirement. I know some more savvy investors will buy individual bonds, but it’s just too much to learn/research for me. The caveat is that the interest rate/amount will vary some per month, AND one’s principle can theoretically be lower/lost (and visa versa)—as opposed to an annuity.

Any other thoughts? Any critique to this logic?

 

[EinSV]

My focus & comments all year have been directed at the Liberal market commentators who totally missed this rally, they predicted a market crash & economic collapse & simply cant admit they were wrong.

I will pass on searching for this FEMA report you are seeking, I believe you are retired so you should have lots of time looking thru bloated Gov. files.

I think that is a fair criticism of some commentators/investors (I haven't checked to see whether the ones you have listed fall into that category).

On the other hand, there was a third path that so far has turned out to be much better than either divesting from stocks or remaining invested in U.S. stock markets -- shifting to ex-US markets:

One of the smartest things you could have done with your money at the start of the year was to get it out of the USA.

American stock market indices have performed much worse than their overseas competitors so far in 2017. That’s despite the hoopla over the gains in the headline U.S. indices.

Meanwhile the U.S. dollar has tumbled sharply against major — and not-so-major — international currencies as well.

The net result is that those who diversified their wealth internationally are… well, winning.
​

Wall Street won’t tell you, but U.S. stocks are underperforming

And as mentioned in my post above, since markets outside the US have significantly outperformed US stock, it is hard to give credit to US politicians for the stock market's performance this year. Of course, this could all change but for the time being the US markets are not keeping up with markets elsewhere since the beginning of the year despite stellar performance by some sectors, especially tech.

 

[Intl Professor]

My focus & comments all year have been directed at the Liberal market commentators who totally missed this rally, they predicted a market crash & economic collapse & simply cant admit they were wrong.

I will pass on searching for this FEMA report you are seeking, I believe you are retired so you should have lots of time looking thru bloated Gov. files.

Can't spend time on this. Way too much of my time is spent on TMC. I'm not at all sure the "blabber heads" predicted a market crash. Their focus, at least the ones you quoted, were concerned about giving our great leader credit for the recovery which is only reaching "normal" status now. That groundwork was laid before. My concern is that a lot of good about regulating the economy will be lost and then when a real emergency occurs, like hurricanes, the least well situated both geographically, economically, and darker of color will suffer the most. Though now a non-believer, that is the residue of what little remains of my early Christian training. Many progressives feel the Pope has got it right on the crucial issues.

\When the dropping consumption of the poor and all but the upper middle class (where we lie) effects the economy we may have a change. Seems to me Wall Street thinks the prospect of tax reduction is what is driving prices. I'm much more optimistic, I think a disruption in energy is what is happening. The tell is the priorities reactionaries like Trump and his supporters believe that we need a shift toward coal, and not cleaner energy. Another on the positive side, are the wages paid to clean energy installers, say, in wind. Meanwhile we're getting a return to serious main stream reporting despite labelling the press as a whole for spewing fake news and being "the enemy," just as was the case with Watergate. Paranoids often create self-fulfilling prophecies confirming their suspicions.

I think even you might agree that coal is being pressured by smart energy investors more than Obama's weak focus on renewables. I have a lot of confidence in business making the right decisions, much less for politicians and the hope for change by their supporters. It is pretty well documented the policies of Trump will fall hardest on those who are most vulnerable—those in the old confederacy. I do not have much confidence in businesses whose model is purely financial, like lobbying for benefits for dead technologies, changes in accounting rules, relaxation of duly passed laws regulating financial reform, or marketing versus word of mouth advertising based on the quality of their products, et cetera.

 

[kenliles]

My focus & comments all year have been directed at the Liberal market commentators who totally missed this rally,

I think that’s fair Lump, and generally agree with it (even as a financial progressive myself). Agree with EinSV above.

I’ve advised family and friends to stay in but not too leveraged. The biggest problem right now is the unknown that comes from nowhere. That risk is high currently.

Correlated with money moving out of US, for those same reasons. I agree with Al, a repatriation of capital that is required to be actually (re)invested would be a ‘tax cut’ this progressive would vote for.

 

[Lump]

I think that is a fair criticism of some commentators/investors (I haven't checked to see whether the ones you have listed fall into that category).

On the other hand, there was a third path that so far has turned out to be much better than either divesting from stocks or remaining invested in U.S. stock markets -- shifting to ex-US markets:

One of the smartest things you could have done with your money at the start of the year was to get it out of the USA.

American stock market indices have performed much worse than their overseas competitors so far in 2017. That’s despite the hoopla over the gains in the headline U.S. indices.

Meanwhile the U.S. dollar has tumbled sharply against major — and not-so-major — international currencies as well.

The net result is that those who diversified their wealth internationally are… well, winning.
​

Wall Street won’t tell you, but U.S. stocks are underperforming

And as mentioned in my post above, since markets outside the US have significantly outperformed US stock, it is hard to give credit to US politicians for the stock market's performance this year. Of course, this could all change but for the time being the US markets are not keeping up with markets elsewhere since the beginning of the year despite stellar performance by some sectors, especially tech.

Old data, so you shouldn't repost it it.
Comparing S&P 500 vs Chinas internet MoMo stocks like Alibaba, Tencent & Baidu while not factoring risk is poor journalism.

S&P500 1 year is 24%
QQQ 1 year is 30%
Chinas MSCI that the article is showing with mostly tech stocks is up 39% pretty much inline with US techs.

Poland up 50% & Austria up 47% are doing great, whats the point of writing an article showing that? there will always be markets especially emerging markets outperforming the US, there were plenty when Obama was President should I dig those up? Was Putin a better President then Obama in 2016?

The 10 best and worst performing stock markets of 2016 | Money Observer
Or in 2015, do you see Obama's name mentioned while Russia was trouncing the US?
This year's best performing stock market is…Russia


Spend your energy trying to make money for your kids & grandkids & stop focusing on this petty crap the media is spewing to spruce thier viewership & profits.

 

[neroden]

We speak with Columbia University psychology and psychiatry professor Carl Hart, who argues people are dying because of ignorance, not because of opioids.

That's actually true. People are dying because of ignorance, not because of opioids.

Opiates are wonder drugs if used properly... but doctors don't know how to use them properly. I know about this personally.

So, something like ten years ago, a close friend of mine with severe degenerative disease, who often has extremely severe pain which is cripppling ("frozen in a rictus of pain", 8 on the pain scale), had to quit all the other painkillers. Aspirin, naproxen, and all the other NSAIDs were quite ineffective, were causing severe stomach problems, and several were causing heart problems. She was already doing all the meditation/exercise/etc. stuff. Cannabis was contraindicated.

That leaves opiates, so she was prescribed opiates. We were worried about the possibilities of addiction and tolerance, so I did intensive research.

It turned out that the world experts on long term opiate usage were a network of MS sufferers in England who had blogs. They had discovered the following very important facts / rules:

1. You never want to be out of pain. If you are fully out of pain, that is when you start to develop tolerance; it is when you start to get high; it is when you have a chance of getting addicted.

When using opiates, you simply want to take the edge off so that you can get through your day. You want to bring the pain down from 8 to 1 or 2. Once the pain is at 1 or 2, so that you can feel it but it's not distracting you from absolutely everything, then you're done, you've taken enough opiates.

If you are never fully out of pain, you will never develop tolerance and you will never get high and you will never become addicted. You can take opiates for 20 years, 30 years, 50 years, 70 years, on the same dosage, with the same effect on pain, without any risks provided you follow this rule.

An MS sufferer who had become addicted to opiates (due to poor prescribing), and had *quit and detoxed* (suffering extreme pain, of course), was able to *go back on opiates* without becoming addicted again, by following this rule rigidly. And by the time I read her blog entry, had stayed on them for over 5 more years. Unfortunately, the tolerance effect is permanent, so she was stuck with the increased dosage caused by the tolerance created by poor prescribing.

Doctors typically don't know this. They never explain it to their patients. The MS patients had figured it out on their own by trial and error.

2. Opiates are slow-acting, and don't start working for 30 minutes to an hour. The onset time slightly different for each opiate/opioid. But basically you just have to suffer through the first hour in extreme pain before you can tell whether the opiate is working. So when you first start trying opiates for pain, you have to take a small dose -- to make sure you don't take too much... and then don't take more until that first hour is up. This trips up people; this is one way people end up taking too much opiate even if they know rule #1.

Many opiates are packaged with Tylenol (acitaminophen), which does start acting immediately. This is pernicious and I think it should be banned, because:

3. Long-term Tylenol use causes liver failure. (If you start having problems, you have to stop it for at least ten years before you can use it again.) If you're on opiates for the long term, you must get the ones without Tylenol. It's safe for opiates to be used for 70 years, but daily use of enough Tylenol will kill you in 5 years. Although this has been known in the medical literature since the 1970s, the doctors typically don't know this either, which is really incredible malpractice.

4. Opiates work very poorly for muscle pain in particular. Many people who have other forms of pain (including those with MS) also have muscle pain, and for some reason opiates just don't work well for muscle pain. Many people with "nonspecific" or unidentifiable pain have muscle pain, and opiates don't work well for them at all. They work great for pain from nerve damage, joint damage, connective tissue damage, etc. etc. etc., but there seems to be something funny about muscle pain which counteracts the opiates. Luckily massage, heat, relaxation exercises, etc. work well for muscle pain (though they're not very good for most of the serious degenerative-disease sources of pain).

----
That's it. That's how to take opiates safely. Used correctly, opiates are wonder drugs. They are the only painkillers which can be safely used for multiple decades without causing liver failure, kidney failure, heart damage, severe stomach damage, or other fatal conditions.

My friend's been on the same dose for a decade, no tolerance, no high, no addiction, and it's vastly improved her life. It's a wonder drug.

But the doctors do not know how to prescribe opioids. They require careful instruction in how to take them. Every patient should know that the goal is "pain that you can feel but that doesn't prevent you from focusing"; every patient should know that the opiates don't start working for an hour. The doctors will carelessly prescribe too much and will not tell the patients any of this, and will kill patients by prescribing drugs with Tylenol for too many years. Which is why I had to learn this from MS sufferers in England.

 

[neroden]

My focus & comments all year have been directed at the Liberal market commentators who totally missed this rally, they predicted a market crash & economic collapse & simply cant admit they were wrong.

Mmmm. Several commenters who were expecting economic collapse have very good economic analysis but missed two things:

(1) The great renewable energy transition. This is creating an large, slow-motion economic boom of a sort which has not been seen since the railroad boom of the 19th century. It overrides a lot of economic phenomena which were true throughout the 20th century. When it finishes, watch out, because that puts us in the economic circumstances which led to World War I.
(2) The fact that stocks can, under certain circumstances, do great even when the underlying economy is going to hell. This should be obvious but people focused more on the broader economy often miss it.

 

[EinSV]

Old data, so you shouldn't repost it it.
Comparing S&P 500 vs Chinas internet MoMo stocks like Alibaba, Tencent & Baidu while not factoring risk is poor journalism.

S&P500 1 year is 24%
QQQ 1 year is 30%
Chinas MSCI that the article is showing with mostly tech stocks is up 39% pretty much inline with US techs.

Poland up 50% & Austria up 47% are doing great, whats the point of writing an article showing that? there will always be markets especially emerging markets outperforming the US, there were plenty when Obama was President should I dig those up? Was Putin a better President then Obama in 2016?
View attachment 256708
The 10 best and worst performing stock markets of 2016 | Money Observer
Or in 2015, do you see Obama's name mentioned while Russia was trouncing the US?
This year's best performing stock market is…Russia


Spend your energy trying to make money for your kids & grandkids & stop focusing on this petty crap the media is spewing to spruce thier viewership & profits.

YTD data at 10/27 close according to Yahoo Finance:

VWO (Vanguard Emerging Markets): +23.69%

VX US (Vanguard total ex-US): +20.21%

VFINX (Vanguard S&P 500): +14.27%

VTI (Vanguard Total US Stock Market): +14.15%

One-year return comparison is much closer as US markets popped right after the election but have not kept up since the turn of the year.

As I mentioned, US tech has done much better than the rest of the market so NASDAQ is doing well.

FWIW I am coming to this from an investment angle rather than politics. I shifted almost all of my stock index funds to a combination of international/emerging markets and US tech (due to valuation issues not politics) so this has worked out well for me this year. Whether it will continue remains to be seen ....

 

[Lump]

Wall Street won’t tell you, but U.S. stocks are underperforming

Massive US Trump rally began night of election, US markets rallied roughly 12% before New Years Eve.
I guess this "journalist" forgot to mention ~12% in 7 weeks,

Further digging about the "columnist"...maybe a tad biased.
https://www.marketwatch.com/story/i...shes-states-that-voted-for-hillary-2017-09-29
40% of Americans won’t believe accurate news stories about Hillary Clinton
The $2.8 billion winners of Trump’s proposed tax cuts are his kids

 

[kenliles]

I’m not exactly following...But regardless of media convictions —
just for clarity regarding my opinion.
The cost of Trump (financial and otherwise), is massively beyond any benefit of whatever stock market rally (if any) can be attributed.
Even beyond (arguable)points that his anticipated policies (i.e. tax cuts), as yet unexecuted, are entirely responsible for the market rally since election, any benefits pale compared to the cost suffered due to the populace that put this moron(that’s a compliment), in charge of anything.
And yes, that means I don’t blame him, but those voters granting him the powers of the office.
Just so we’re clear;

 

[Intl Professor]

I think I posted, way back, about my favorite course which I taught for many years, Authoritarian Mass Movements, which was not about bowels, as one colleague wagged, but the disturbing rise of popular authoritarian mass movements of the 20th century, both communist as in Russia and China, but free market types like German Nazism and Italian Fascism. One book appropriate for the class was Hannah Arendt/s, The Origins of Totalitarianism, especially her third part where she constructs a model after a historical tour de force. One takeaway: they were all popular movements with a charismatic leader who was gifted at public relations. Another was their insistence on crushing any opposition and institutions that could defend liberty, democracy, truth, or constructive dialogue with the regime. Orwell, of course, even earlier put his finger on the problem when Winston works in the Ministry of Truth to either eliminate the power of language connected to thought or to change the meaning of words for the same end. Freedom became slavery, and vice versa.

A contemporary beacon of the dangers such movements pose is a recent book by a Yale historian, Timothy Snyder, On Tyranny: Twenty Lessons from the Twentieth Century. I saw today an interview conducted by the hated CNN which coincided with my memory of Arendt's work. Here is another interview capturing the essence of the book. Caution: the site is progressive, so I have forewarned to avoid others who believe it is an offense for the press to attack a president, even though all suffer from it since Washington. That is its role. What is different with Trump is his labelling all of it an "enemy of the people," just like the villains of Russia, China, Germany, and Italy maintained it to be. Trump has recently bragged about creating fake news and how successful the tactic has been in neutralizing the press.

On Tyranny: Yale Historian Timothy Snyder on How the U.S. Can Avoid Sliding into Authoritarianism | Democracy Now!

We are in very deep caca and only ten months in.

To quote the great tt007, feel free to ignore me, but your reposts give me more to think about than most.

Bye for now. My wife has to walk me.

 

[neroden]

YTD data at 10/27 close according to Yahoo Finance:

VWO (Vanguard Emerging Markets): +23.69%

VX US (Vanguard total ex-US): +20.21%

VFINX (Vanguard S&P 500): +14.27%

VTI (Vanguard Total US Stock Market): +14.15%

One-year return comparison is much closer as US markets popped right after the election but have not kept up since the turn of the year.

As I mentioned, US tech has done much better than the rest of the market so NASDAQ is doing well.

Ah. My US portfolio is extremely heavily tilted towards tech so that's probably why international stocks haven't been looking particularly attractive to me this year.

FWIW I am coming to this from an investment angle rather than politics.

 

[neroden]

One takeaway: they were all popular movements with a charismatic leader who was gifted at public relations. Another was their insistence on crushing any opposition and institutions that could defend liberty, democracy, truth, or constructive dialogue with the regime.

It's a serious risk right now, and has been since the election theft in 2000 (remember the illegitimate G W Bush regime saying that everyone had to support the President?). However, the risk is actually dropping. There's much more social agreement in the US that it's OK to criticize the current regime now than there was in 2002, when there was a serious chill on open discussion.

And one thing I'm certain about: if we do get an authoritarian dictator, it won't be Trump. He's much too incompetent, to the point where pretty much all of his staff hate him. Worry, rather, about who might attempt to replace Trump through non-legitimate means. An orderly impeachment or 25th amendment removal would be fine. But if we had a military coup against Trump -- perhaps to prevent him from starting a nuclear war -- the person who did that (and could credibly claim to have saved the world from nuclear war!) could be a real candidate for a successful charismatic dictator.

 

[Intl Professor]

I agree. Trump is really not interested in leading, that would require a plan. We have a fake White House as he fritters away his authority and the dignity of the office each day. He's really an insecure guy. But they can be really dangerous.

 

[goinfraftw]

Question: What happens if the Mueller probe fixes at least 80% of the problems? What happens to the US economy? World economy? What short-term and long-term effects are there on the Climate Accord and implementation of it?

 

[neroden]

The Paris Climate Accord was a neat piece of diplomatic jiujitsu.

It is completely non-binding, enforceable only by public shaming, and as a result it will be completely implemented by every country, whether they sign it or not, and whether their government supports it or not!

I can't say about any other political consequences.

 

[22522]

I think I posted, way back, about my favorite course which I taught for many years, Authoritarian Mass Movements, which was not about bowels, as one colleague wagged, but the disturbing rise of popular authoritarian mass movements of the 20th century, both communist as in Russia and China, but free market types like German Nazism and Italian Fascism. One book appropriate for the class was Hannah Arendt/s, The Origins of Totalitarianism, especially her third part where she constructs a model after a historical tour de force. One takeaway: they were all popular movements with a charismatic leader who was gifted at public relations. Another was their insistence on crushing any opposition and institutions that could defend liberty, democracy, truth, or constructive dialogue with the regime. Orwell, of course, even earlier put his finger on the problem when Winston works in the Ministry of Truth to either eliminate the power of language connected to thought or to change the meaning of words for the same end. Freedom became slavery, and vice versa.

A contemporary beacon of the dangers such movements pose is a recent book by a Yale historian, Timothy Snyder, On Tyranny: Twenty Lessons from the Twentieth Century. I saw today an interview conducted by the hated CNN which coincided with my memory of Arendt's work. Here is another interview capturing the essence of the book. Caution: the site is progressive, so I have forewarned to avoid others who believe it is an offense for the press to attack a president, even though all suffer from it since Washington. That is its role. What is different with Trump is his labelling all of it an "enemy of the people," just like the villains of Russia, China, Germany, and Italy maintained it to be. Trump has recently bragged about creating fake news and how successful the tactic has been in neutralizing the press.

On Tyranny: Yale Historian Timothy Snyder on How the U.S. Can Avoid Sliding into Authoritarianism | Democracy Now!

We are in very deep caca and only ten months in.

To quote the great tt007, feel free to ignore me, but your reposts give me more to think about than most.

Bye for now. My wife has to walk me.

I used to think Eric Hoffer 'True Believer' was the reference work. Using it as a reference, I don't think Trump has many true believers. Maybe I'm wrong.