Eduardo must be losing his mind
- Thread starter bdgan
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It’s temporary. What you really mean is the market just got ahead of the manipulative Fed. Prepare for blastoff.
Blastoff? Driven by what? The promise of AI?
Otherwise, valuations are already way out over their skis, which we might expect when a massive sum of money is in circulation and all of it is looking for some kind of yield. Thus stock prices become unanchored and get bid up into the stratosphere. The central bankers, led by the US Fed, were the cause of this, as they financed the reckless fiscal spending during Covid. The global economy is now struggling as a result -- first inflation, then recession.
The real economy on Main Street -- the lower two-thirds of Americans -- are feeling the effects of stagflation. The "growth" in employment, if we want to call it that, has largely been in government services and healthcare. It hasn't been within the growth engine -- manufacturing, farming, mining, etc. These have been in recession for several years now. Plus we still have inflation above target.
This is known as stagflation. Most people don't recognize it, and officials don't want to acknowledge it, because it is terrible. Stagflation is being masked. A lot of people left the workforce for retirement (via the Covid money supply windfall), or have given up seeking employment (i.e., the male basement dwellers). They are not counted among the unemployed.
In short, we are not producing more. We are just producing at higher prices. That is not real growth.
The Fed can cut interest rates and stoke inflation -- the reason the long end of the bond curve is rising -- or leave interest rates high and stoke unemployment, thus creating a recession/depression. Either way most people are simply becoming more poor.
This is not a good economy for the average citizen. That is why they voted the way they voted. The elites -- the people you see on TV -- think it is a good economy because they are swimming in cash. They cite the bulk statistics, which include all of the cash being spent by the wealthy. But all of that money is now a burden for the poor and working class, i.e., high prices and high interest rates. The middle class -- the people on the margin -- continue to see their numbers erode.
This is the kind of stock market that can continue to soar as investors keep their heads in the sand, but usually it ends badly. This week we may have started to see cracks develop within the foundation.
Insiders have been selling. Warren Buffet has been raising huge sums of cash. I am not that smart, so when he is selling I am not buying.
Good luck to all, and a Merry Christmas. Time for the Santa Rally.
Driven by an unleashed US economy. Much of what you say about the current economy is true. But sit back and watch, my friend. I’m not impressed with Warren Buffett either. He bought Coca Cola, newspapers and supported Obama as part of a protection racket. It’s not hard to make money if you have money. It’s extremely difficult to make money out of nothing. Warren Buffet couldn’t carry Elon Musk’s jockstrap.
I was the working class all my working life and didn't live beyond my means and invested. I didn't party my ass off with 22% credit card debt. I trained for new jobs while working and I invested rather than spent. I did not inherit great wealth. So, I am tired of hearing about the elites vs the poor working class especially those that spent their working life buying into wealth acquired through consumption and get rich by the acting rich routine.
Elon was born wealthy and bought up other people's ideas and subsequently sucked off the government teet for survival (before railing against the same government teet that was wholly responsible for his subsequent wealth generation). Elon couldn't figure out how to put on a jockstrap (or a condom, for that matter), so he just carries other's and claims them as his own.
That's great. I did the same. It is a must no matter where you stand on the economic scale. Your standard of living must adjust accordingly.
But ..... you and I had the benefit of massive amounts of stimulus to the tune of a 36 Trillion dollar national debt. That debt is now a colossal millstone on the next generation. In other words, it is harder for them to scrape up the same amount to invest.
This huge transfer of wealth has continued, even during a pandemic (when the opposite should have occurred) as the M2 money supply continues to grow. That is the fuel behind current market valuations.
This particular issue is non-partisan as both political parties have added fuel to the fire, just in different ways. I might argue that one is less damaging than the other but that doesn't change the basic premise: This is a country that went into massive debt while building next to nothing with that capital. We are now facing the inevitable fallout: Taxation either through the IRS or through inflation.
There is no getting around this. We have heard that business incentives will be coming, but the raw truth is that it takes the consumption of capital to build a factory before that factory can produce a return on investment. During the interim we will have the tax: IRS or inflation. If the government uses the IRS then the capital, for wealthy taxpayers and corporations, has a tendency to flee the country in order to avoid paying up. If they use inflation then investors and the wealthy benefit as consumers get hurt.
This is why it is irresponsible not to pay as you go, whether it be for a factory or to fund a war or to pay for old people or to pay for medical care. Now we have a massive interest payment on top.
Most people do not understand this. They just look at their current bank account balance without a thought to how it got there and without a thought to what it means for the next generation.
Musk belonged to an upper-middle-class family in South Africa. So, while they were wealthy enough to have a comfortable lifestyle, they couldn't support Musk after he moved to Canada. Musk didn't get his early money from his parents for startups. There are many myths surrounding Musk’s parents' financial wealth.
One rumor is that his father owned an emerald mine, which Musk denied. He actually worked his way through college and had $100,000 in student debt.
Elon Musk Is Among the Richest in the World — Was He Born Rich?
For years, Elon Musk has been listed as one of the top five richest people in the world. Was the Tesla founder born rich? We've got the answers.
That makes you an American Hero in my mind. One of many millions but an American Hero nonetheless.
I largely agree but...
- Young people still have tremendous opportunities. It's not that difficult to earn $80k+ if you're a skilled tradesman or even a truck driver.
- Too many young people graduate with large student debt and a career that doesn't generate sufficient income for them to get a decent return on their educational investment. These young people have nobody to blame but themselves and their guidance counsellors. They forego options like community college and trade schools. Meanwhile they major in areas that have low demand/salaries.
- Many young people today are going to benefit from the largest wealth transfer in the history of this country.
That intergenerational wealth transfer is uneven, just as the points I made above are uneven. For me personally I will inherit nothing, because I came from a working class family. In fact, instead of an inheritance, there is a good chance that we will be stuck with the burden of parental old age care.
I don't have a problem with unevenness as long as it did not come through borrowing. But it did, so we have taken money from some to benefit others.
I totally agree with the corruption of education in this country -- high cost to train for a job that does not exist, or a job that does not produce a reasonable return on investment. It is insanity, or corruption, depending on whether you are the borrower or the institution. All the more reason to get rid of the Department of Education and public financing of education. The status quo has removed market performance incentives, so it should come as no surprise that, overall, we don't get a good return on our education dollar.
Same here. My father went to Milton Hershey school. He started from nothing. My wife’s father is a pastor. We both stood on our parents’ shoulders, used our education to become certified professionals and then spent less than we earned and invested the rest. We stopped working in our 50’s because we achieved most all of our goals and didn’t want to keep working just to give millions away. It’s been a wonderful life as they say. If you make good decisions and have a little faith, anyone can do it.
You (and I) might have done all the right things but your early retirement had a huge tailwind, which is a headwind for the next generation.
To put it simply, your stock returns would not have been anywhere close to what you realized without all of the deficit spending (stimulus) that put this country 36 trillion in debt.
Now we have to unwind that debt (through austerity) or hyper-inflate the currency (i.e., take the cash away that grew rather easily for you). Maybe we can grow out of it with technology and oil mining but I struggle to see how that will reverse a debt/GDP that stands at 120%. The higher that number goes the worse it becomes, just as it is with social security. The longer we do nothing the larger the inevitable cuts.
If we can't get people to understand this on a bulletin board comprised of college graduates then what hope is there? The "elites" can do whatever they want and get away with it, because the rest of us are stupid.
Again much of what you say is true. These things need to be improved if not fixed entirely. Inept government poses the greatest risk to everything on the planet. The stock market has survived throughout and I suspect will continue to thrive over the long term. Self correction has been built into our system and is at work as we speak. We’ll see how it turns out. I am an optimist but I can understand the doomsayers.
Nothing gets "fixed" when the people that need to do the fixing are the ones reaping the benefits.
I could go on and on about the many ways that the current system is corrupt. One thing we should keep in mind is what a society will do when it deems a system is unfair. Eventually they will do whatever it takes to overthrow that system. History is replete with examples.
That article reads like it was written by an early, faulty version of ChatGPT.Musk belonged to an upper-middle-class family in South Africa. So, while they were wealthy enough to have a comfortable lifestyle, they couldn't support Musk after he moved to Canada. Musk didn't get his early money from his parents for startups. There are many myths surrounding Musk’s parents' financial wealth.
One rumor is that his father owned an emerald mine, which Musk denied. He actually worked his way through college and had $100,000 in student debt.
Elon Musk Is Among the Richest in the World — Was He Born Rich?
For years, Elon Musk has been listed as one of the top five richest people in the world. Was the Tesla founder born rich? We've got the answers.marketrealist.com
Musk's daddy owned a yacht and a plane, among many other luxury items. They were RICH. And, yes, Elon's daddy owned the rights to work the emerald mines ... but didn't actually own the mines ... but that was a business-savvy choice. And Musk's daddy, who was a philandering scumbag, like Elon, gave Elon the money to start his acquisitions of other people's companies. And Elon, being the dirtbag he is, would try to make it seem like it was his idea. And Elon, being the dirtbag he is, would depend on the government just to exist ... for years and years ... and when he finally felt secure enough, would turn on the government because it benefitted him to do so ... and, in actuality, his play here was to back a "new" government so he could REALLY get his way as a part (head?) of the decision-making team.
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S&P way back up (+1.84%) halfway through trading today. Only 100 points roughly from its all time high. I'm thinking we see a retraction/correction in '25 to the tune of about 12% but then again did anyone see nearly 30% growth this year coming?
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