OT: Lets talk about stocks (Part 3)

[Hope Of Glory]

Don't think I gave you an exact date either. The hard part in any future-looking statement is seeing the pieces that will unfold, but there are always human survival behaviours that makes planning difficult.

Moreover, we are already in "the big crash".

1) Stocks are way down ---> expect consequences
2) 10% inflation, faster than wage increases ---> expect consequences
3) Real estate is crashing --> expect consequences
4) The energy situation in Europe is a time bomb of high probability
5) The real estate situation in China is a time bomb of high probability
6) Interest rates are going up fast (less loans, more saving, less money supply = slow down)
7) Unemployment is about to start going up if only because startups won't get their next round of financing, and the big 5 are already conducting shadow layoffs via coming back to the office orders.
8) Demographic is terminal, everywhere where there is capital. Beyond high probability that most countries economies will go down for the next 35-40 years. Only the US millenials will rebound that sinking ship, and only for 10 years.

What did you think it would look like, like 1929? It's 2022, you are in it. +The 4 horsemans (war, famine, pandemics, financial collapse) come together, always...the famine part is likely and accelerate the others 3.)



January/Feb is my guess. Real estate and unemployment are what always pushes it down - real estate is going but it's not quite there yet - unemployment is a slow-moving trend.

Things do look grim. So what are you doing with your money? Holding cash? If so, what's your entry point?

 

[HuGort]

Don't think I gave you an exact date either. The hard part in any future-looking statement is seeing the pieces that will unfold, but there are always human survival behaviours that makes planning difficult.

Moreover, we are already in "the big crash".

1) Stocks are way down ---> expect consequences
2) 10% inflation, faster than wage increases ---> expect consequences
3) Real estate is crashing --> expect consequences
4) The energy situation in Europe is a time bomb of high probability
5) The real estate situation in China is a time bomb of high probability
6) Interest rates are going up fast (less loans, more saving, less money supply = slow down)
7) Unemployment is about to start going up if only because startups won't get their next round of financing, and the big 5 are already conducting shadow layoffs via coming back to the office orders.
8) Demographic is terminal, everywhere where there is capital. Beyond high probability that most countries economies will go down for the next 35-40 years. Only the US millenials will rebound that sinking ship, and only for 10 years.

What did you think it would look like, like 1929? It's 2022, you are in it. +The 4 horsemans (war, famine, pandemics, financial collapse) come together, always...the famine part is likely and accelerate the others 3.)



January/Feb is my guess. Real estate and unemployment are what always pushes it down - real estate is going but it's not quite there yet - unemployment is a slow-moving trend.

Feds said yesterday they want 2 years of 6.5% unemployment. That's macro change from where we are now. They must be planning big rate increases. Some are predicting a depression. I hope they are wrong. I am calling on major recession. Like you though, hard to factor in human factor. Chinese I don't trust them. Could see major war break out.

 

[SOLR]

Things do look grim. So what are you doing with your money? Holding cash? If so, what's your entry point?

Mostly holding cash at this point, this will last 3 years....
I think there are multiple entry points. Real estate will be first.

 

[Hope Of Glory]

Mostly holding cash at this point, this will last 3 years....
I think there are multiple entry points. Real estate will be first.

Yeah I'll definitely be looking to buy real estate in the next few year. This seems like a no-brainer, once prices drop. They're already dropping.

 

[HuGort]

Mostly holding cash at this point, this will last 3 years....
I think there are multiple entry points. Real estate will be first.

Generally when GICs rates are high the stock market dips. Many people like the security of solid return rates

 

[montreal]

Why I Remain Bullish on the United States of America - A Wealth of Common Sense

Following the Great Financial Crisis of 2008 a number of macro doom-and-gloomers began predicting a collapse of the U.S. dollar. The Fed was “printing” trillions of dollars. Interest rates had never been that low before. It was an appealing narrative if you were someone stuck in the negative...

awealthofcommonsense.com

 

[HuGort]

Why I Remain Bullish on the United States of America - A Wealth of Common Sense

Following the Great Financial Crisis of 2008 a number of macro doom-and-gloomers began predicting a collapse of the U.S. dollar. The Fed was “printing” trillions of dollars. Interest rates had never been that low before. It was an appealing narrative if you were someone stuck in the negative...

awealthofcommonsense.com

In words of Warren Buffett, circa 2008, this whole sucker almost came down. Came within a hair of seeing total financial collapse.

Going to be a few years before S&P gets back to 2021 levels. Interest rates are going to rise quite a bit yet. Earnings have started to slide. Fed wants two years of 6.5% unemployment rates. To get inflation under control. We are in major financial war

 

[SOLR]

I'm also bullish about the US - they can take a punch and give one.

And well, they have the only millennial generation of any size, in the world. Demography is destiny yade yadda.

 

[HuGort]

Another day not so great numbers.

 

[BehindTheTimes]

I'm also bullish about the US - they can take a punch and give one.

And well, they have the only millennial generation of any size, in the world. Demography is destiny yade yadda.

Not I.

Another day not so great numbers.

We’ve got about another 20% to go.

 

[HockeyF3ind]

Not I.


We’ve got about another 20% to go.

SPY 300!

 

[SOLR]

Not I.

"bullish in comparison of everywhere else and there is a significant political risk in the next 5 years"

 

[BehindTheTimes]

"bullish in comparison of everywhere else and there is a significant political risk in the next 5 years"

Perhaps, I can go along with this, but the idea that the US isn’t in deep dogshit themselves is not something I can get behind. The entire financial system and financial markets are at risk imo.

I find it hard to be bullish on that. The unfunded pension liabilities alone is enough to collapse the system if missteps are taken. The US isn’t immune to global markets caving in. They are completely corrupt and the next crash will make 2008 look small imo. Market conditions have only deteriorated since.

 

[HuGort]

S&P dropped 5% yesterday. DOW dropped 4%. On bad CPI report for August. Inflation is continuing to surge. Feds need to increase interest rates higher than expected. Hold them longer also. Many are predicting the S&P to hit 3,000.

 

[SOLR]

Perhaps, I can go along with this, but the idea that the US isn’t in deep dogshit themselves is not something I can get behind. The entire financial system and financial markets are at risk imo.

I find it hard to be bullish on that. The unfunded pension liabilities alone is enough to collapse the system if missteps are taken. The US isn’t immune to global markets caving in. They are completely corrupt and the next crash will make 2008 look small imo. Market conditions have only deteriorated since.

Everybody is in deep shit in the short term, but I'm taking a longer view in general.
The US has been here before, and while some days I find it hard to be hopeful, I do believe it is better to be hopeful than not, as a way of inducing the growth mindset necessary to operate in my environment.

 

[SOLR]

S&P dropped 5% yesterday. DOW dropped 4%. On bad CPI report for August. Inflation is continuing to surge. Feds need to increase interest rates higher than expected. Hold them longer also. Many are predicting the S&P to hit 3,000.

Feds need to fix the real problem: re-arranging the supply chains for a world without China. This means a lot more inflation over the next 10 years (to rebuild the factory base, and automate these things). We don't need any of that climate change privation idiocy. We can solve climate change and have abundance, the world's population will decrease significantly (reproduction rate models have been proven wrong every year for the past 12, it's always much worse than the revised models!) in the next 60 years (inflation is yet another macro against family formation) - moving TO natural gas/hydrogen and EVs at scale would reduce carbon emissions to the point we would reduce atmospheric carbon...by replacing all the wood, petroleum, coal, dogshit, controlled forest burns (fertilization) that are the real problems. Growing a lot of food is a carbon CAPTURE mechanism (to say nothing of automated farming that requires 30% of the N/K inputs etc.) . Our politicians are hypocrites running far away from their own best interests.

 

[QuebecPride]

S&P dropped 5% yesterday. DOW dropped 4%. On bad CPI report for August. Inflation is continuing to surge. Feds need to increase interest rates higher than expected. Hold them longer also. Many are predicting the S&P to hit 3,000.

For long term investors, it's another great opportunity to invest.

 

[Hope Of Glory]

Feds need to fix the real problem: re-arranging the supply chains for a world without China. This means a lot more inflation over the next 10 years (to rebuild the factory base, and automate these things). We don't need any of that climate change privation idiocy. We can solve climate change and have abundance, the world's population will decrease significantly (reproduction rate models have been proven wrong every year for the past 12, it's always much worse than the revised models!) in the next 60 years (inflation is yet another macro against family formation) - moving TO natural gas/hydrogen and EVs at scale would reduce carbon emissions to the point we would reduce atmospheric carbon...by replacing all the wood, petroleum, coal, dogshit, controlled forest burns (fertilization) that are the real problems. Growing a lot of food is a carbon CAPTURE mechanism (to say nothing of automated farming that requires 30% of the N/K inputs etc.) . Our politicians are hypocrites running far away from their own best interests.

Do you have any specific company (or even ETFs) worth looking up that could benefit from the upcoming factory boom in the US or elsewhere in the world?

 

[QuebecPride]

Do you have any specific company (or even ETFs) worth looking up that could benefit from the upcoming factory boom in the US or elsewhere in the world?

I know I was not the one you asked.

But the simpler, the better, 99% of the time in investing.

So if you want US exposure, as a Canadian, I'd suggest VUN, which is a total market US ETF.

But I strongly suggest you simply go with a worlwide total market funds like VEQT (if you`re okay with having 100% equity).

 

[HuGort]

Feds need to fix the real problem: re-arranging the supply chains for a world without China. This means a lot more inflation over the next 10 years (to rebuild the factory base, and automate these things). We don't need any of that climate change privation idiocy. We can solve climate change and have abundance, the world's population will decrease significantly (reproduction rate models have been proven wrong every year for the past 12, it's always much worse than the revised models!) in the next 60 years (inflation is yet another macro against family formation) - moving TO natural gas/hydrogen and EVs at scale would reduce carbon emissions to the point we would reduce atmospheric carbon...by replacing all the wood, petroleum, coal, dogshit, controlled forest burns (fertilization) that are the real problems. Growing a lot of food is a carbon CAPTURE mechanism (to say nothing of automated farming that requires 30% of the N/K inputs etc.) . Our politicians are hypocrites running far away from their own best interests.

If you think world's population is going to decrease significantly, you are pipe dreaming. We are adding more people per year than ever before. Over 80 million each year added. The growth rate is slowing but you have more people. Back 50-60 years ago, height of baby boom, world's population was growing 2-2.3%. But only 3 billion people. So, earth only added 60million each year. Today our growth rate is half what is was in 1960s, but 1.1% at 8 billion people is over 80 million each year. We are growing faster than ever before in 4 billion year history of Earth. Nnot going to see major decreases each year. The opposite will happen. Population will increase.

Your pollution problem is cars. There are 6 times more cars on the road today than late as 1985. The earth is the same size. All those carbons are taking their tole. You can tell with global warming. All these new viruses popping up. Crazy weather patterns. You have 80 million more people each year,economy grows average 2% per year. That means more people with more money. Cars have taken off like never before. If we don't change no world for our grand children. At least world as we know it.

On China, I don't know what to do? They are not honest people. Dealing with them in business sometimes I think there is nothing they wouldn't do. I could tell a few episodes which would curl your ears. They see things different than we do. Likely a by-product of growing up in a country smaller than Canada but over 1 billion people. Eventually it will go to a major war. For we have what they want. We have land and resources. At some point it will break. I just hope I am not alive to see it.

I thought for a moment they may use this Russian war as a stepping stone. But looks to be too early yet.

 

[Hope Of Glory]

I know I was not the one you asked.

But the simpler, the better, 99% of the time in investing.

So if you want US exposure, as a Canadian, I'd suggest VUN, which is a total market US ETF.

But I strongly suggest you simply go with a worlwide total market funds like VEQT (if you`re okay with having 100% equity).

Thanks for anwsering, always appreciate your input. But yes, the vast majority of my holding is in VFV and XEQT alreadu. I'm mid-late 20s so I'm not stressed about the market at all long term.

But I like to make fun, side bets with roughly 5% on my portfolio. That's why I was asking about companies that will benefit about the upcoming manufacturing boom that hopefully materialize in the next 5-10 years. There's probably decent money to be made from that, although I'm not sufficiently well-versed in the subject to make a big bet on it.

 

[SOLR]

If you think world's population is going to decrease significantly, you are pipe dreaming. We are adding more people per year than ever before. Over 80 million each year added. The growth rate is slowing but you have more people. Back 50-60 years ago, height of baby boom, world's population was growing 2-2.3%. But only 3 billion people. So, earth only added 60million each year. Today our growth rate is half what is was in 1960s, but 1.1% at 8 billion people is over 80 million each year. We are growing faster than ever before in 4 billion year history of Earth. Nnot going to see major decreases each year. The opposite will happen. Population will increase.

Your pollution problem is cars. There are 6 times more cars on the road today than late as 1985. The earth is the same size. All those carbons are taking their tole. You can tell with global warming. All these new viruses popping up. Crazy weather patterns. You have 80 million more people each year,economy grows average 2% per year. That means more people with more money. Cars have taken off like never before. If we don't change no world for our grand children. At least world as we know it.

On China, I don't know what to do? They are not honest people. Dealing with them in business sometimes I think there is nothing they wouldn't do. I could tell a few episodes which would curl your ears. They see things different than we do. Likely a by-product of growing up in a country smaller than Canada but over 1 billion people. Eventually it will go to a major war. For we have what they want. We have land and resources. At some point it will break. I just hope I am not alive to see it.

I thought for a moment they may use this Russian war as a stepping stone. But looks to be too early yet.

Your stats are incorrect in a crucial way, you are ignoring the terminal population in 85% of countries and Africa will go terminal by 2035 instead of 2060, given what is happening in Ukraine (out of food).

The population will decrease significantly. The Chinese are unveiling their dismal census that overcounted their population by 100 million women(!) - and they will lose half their population by 2070, that's minus 600 million right there, without wars, famine etc etc. (that's all coming).

Even the NYT is talking about this:

Long Slide Looms for World Population, With Sweeping Ramifications (Published 2021)

Fewer babies’ cries. More abandoned homes. Toward the middle of this century, as deaths start to exceed births, changes will come that are hard to fathom.

www.nytimes.com

That was before the pandemic, wars, de-globalization, famine, wars (food wars), and climate change. Nigeria will go terminal before 2030 if they stop getting food help.

India is going terminal (everytime you think it can't go lower...it can)

Anyone who is looking at this seriously: there is only one outcome possible.

 

[QuebecPride]

Thanks for anwsering, always appreciate your input. But yes, the vast majority of my holding is in VFV and XEQT alreadu. I'm mid-late 20s so I'm not stressed about the market at all long term.

But I like to make fun, side bets with roughly 5% on my portfolio. That's why I was asking about companies that will benefit about the upcoming manufacturing boom that hopefully materialize in the next 5-10 years. There's probably decent money to be made from that, although I'm not sufficiently well-versed in the subject to make a big bet on it.

If US companies benefit from the manufacturing boom, odds are they will be in VFV or XEQT, unless they're private. It's really tough to predict which companies or sector will outperform.

You might want to look at companies with a low P/E and a high margin of profits. Those who rank high in both those metrics should do well, but again it's far from a guarantee. In our Student fund at the University, we invested in companies like Transforce (TFE), Richelieu Hardware, etc, that have proven to outperform in the past 5-10 years. But you really have to dig deep to make a good selection and it takes a ton of time. Personally, unless I'm getting paid to do research, I wouldn't put the time into it. The reward for the amount of time involved is very tiny % wise on returns. And a lot of luck is involved. Separating luck from skill is one of the long-time classic conundrums in Investing.

I'd start with those two ratios and identify a few companies that interest me that score well in those two, but I would not hold my breath and expect to outperform the index funds.

 

[Hope Of Glory]

If US companies benefit from the manufacturing boom, odds are they will be in VFV or XEQT, unless they're private. It's really tough to predict which companies or sector will outperform.

You might want to look at companies with a low P/E and a high margin of profits. Those who rank high in both those metrics should do well, but again it's far from a guarantee. In our Student fund at the University, we invested in companies like Transforce (TFE), Richelieu Hardware, etc, that have proven to outperform in the past 5-10 years. But you really have to dig deep to make a good selection and it takes a ton of time. Personally, unless I'm getting paid to do research, I wouldn't put the time into it. The reward for the amount of time involved is very tiny % wise on returns. And a lot of luck is involved. Separating luck from skill is one of the long-time classic conundrums in Investing.

I'd start with those two ratios and identify a few companies that interest me that score well in those two, but I would not hold my breath and expect to outperform the index funds.

Yeah, that won't ever be worth it money wise given how little money I plan on investing (low 4 digits at best), the time it takes to do the research and, as you said, how much luck involved there is. Working overtime would be much more lucrative. But it's a fun challenge to undertake as someone who is completely outside of finance. I'm fully aware that my chances of beating the market are low and, even if I succeed, that will be mostly due to luck. Still a pretty interesting exercise to undertake so thank you for the pointers. I will definitely look into that in the near future.

 

[DailyKaizen]

In words of Warren Buffett, circa 2008, this whole sucker almost came down. Came within a hair of seeing total financial collapse.

Going to be a few years before S&P gets back to 2021 levels. Interest rates are going to rise quite a bit yet. Earnings have started to slide. Fed wants two years of 6.5% unemployment rates. To get inflation under control. We are in major financial war

The best time to make profit is when there is (figuratively) blood on the streets, to evolve the Rothschild original quote...

Also, you find out who's been swimming naked when the tide goes out ...this anecdote? is apt to illustrate all of today's complaints about a bear market etc are the ones who don't bother to have the initiative to turn lemons to lemonade...dig the well before you are thirsty...apply this wisdom to investing and it will be practical and advantageous for you.