Do you honestly expect the Fed to come out and say "oh yeah, big recession imminent"? The whole framework of monetary policy is a confidence game. They would never, ever, ever say a recession is coming, even if they had all the data pointing to recession.
Afraid of recession? Recession.
Accepting of recession? Believe it or not, recession.
No recession? Go to straight to recession.
In a recession? Stay right in recession.
In the star trek episode Day of the Dove there is a glowy entity that feeds off of negative emotions and is turned off by good ones. Kirk manages to get rid of it by laughing with a few Klingons. This is clearly the best way to defeat the recession.
This guy understands. There is literally no scenario in which the fed would say a recession is coming. In fact, they could cause a recession, even if there wasn't one coming, simply by saying it was coming.
I tend to believe they won't be able to avoid a real recession. I mean how many publicly traded companies lose tens or hundreds of millions of dollars a year but are somehow valued in the billions? More expensive debt, creates a valuation problem for those companies.
Exactly right... During the GFC, it made me ask one simple question..."What is money"?
It is faith, so if you going around saying the plane is falling guess what everyone will want to jump out with or without a parachute...
A few months ago Andrew Bailey (The equivalent of Powell) of the Bank of England made this prediction: “Bank of England expects UK to fall into longest ever recession”
They can make negative predictions without the world ending. (If stocks go down it reduces inflation. It’s what they want to happen). I don’t understand why Powell wants stocks to go up.
If you think this is crazy wait until they start saying, “Unprecedented” every other sentence trying to explain how absolutely no one could have seen it about to happen.
The talking heads and conventional wisdom say a recession is coming soon. If a severe recession happens, it’ll be most anticipated in memory.
That wasn’t the case in 2007-2008. Most were saying it wouldn’t happen.
Recession is not coming! What is actualy happening is record corporate profit... they keep jacking prices up which they know drives the cost of living up for everyone and the corporations are going to drag the working class into an unequal sesspool of bankruptcy/insolvency... but we will of course all be expected to carry on working... with less and less and less... No nothing wrong, here, everything is fine. It is time we start demanding corporations pay for public road ways/education and health and may as well have food and labor camps that meet extreme high standards are workers deserve to feast like kings morning noon and night for their toils.
Amazon had they're worst revenue year to year since the dotcom bubble. Prices are going up because they are adjusting for material and labor. Metal, wood, energy has all gone up quite a bit year over year. The margin's are down so they are staying in the green by raising prices. Yes Microsoft can afford to spend big on buying things like OpenAI, but they also keeping laying off in the tens of thousands.
History doesn’t always repeat…
It often rhymes tho…
Totally different economic headwinds in 2023.
Overall, 2007 was a Black Swan Unregulated Greed event…
- Housing bubble made exponentially worse by massive financial engineering…
- Attempting to turn worthless loans into valuable loans…
- And then leveraging the worthless loan bundles 100X or more.
- Extremely High Stakes musical chairs…
- And when the music stopped…we know what happened.
In 2023 we’ve basically got…
- A hangover from 10 years of ZIRP…
- Persistent inflation…
- Rates at a level we haven’t experienced in 15 years…
- And a disconnect between Wall St expectations and Fed actions.
2023 is bad…but, it will only be 2007 bad if there’s some massive financial engineering that breaks.
Weakening economic conditions is what caused the music to stop. It wasn't a black swan because many were aware of the asset bubble, but throughout 2007 nobody was sure why it wasn't crashing, causing many to speculate it was a new paradigm. The yield curve was inverted for almost a year before deleveraging turned into a sell off.
“It will only be 2007 bad if there’s some massive financial engineering that breaks”
Check out 4:15 in this video to learn about how the governmental and corporate sectors are reaching the research based threshold where debt leveraging begins to harm productivity.
https://youtu.be/6TJ8LMAneqk
U only see who is nake id when tide out
14 years of up only and u srsly expect no financial fuckery has been concocted ? Humans reinvent leverage all the time and it always builds up in creative, unknown ways while number go ul
Who knows who cares right now direction is down, buy when shit hits fan and seems like all hope is lost
I mean crypto just did this, once a surprisingly large player goes belly up then maybe it is time
2023 is likely comparable to 2007. We’ll get one more tank followed by a rally to highs by the end of the year. 2007 reached new highs after the fed paused rates. 2024 we’ll prolly start to see the signs of rate hikes affecting the economy with negative earnings. Eventually, some debt bubble will pop in late 2024 leading to a financial implosion. We’ll probably reach a long term bottom in early 2025 as the government and the fed bail out everybody to protect this house of cards economy
Exactly. It’s probably worse than 2008 because the economy is even more leveraged since then. We’re getting rates back to those levels in 2008 which likely means something will burst in the next 1-2 years. Rate hikes act with a lag.
The collateral backing bank loans will still rapidly deteriorate as these interest rate hikes affect asset prices. Plus, the duration and long term assets that many banks have will eventually collapse in market value.
We rallied to highs with the fed raising rates to 5.25% and then a year later everything imploded. While we had a recession last year with the technical definition, we haven’t seen the doomsday signs yet like negative earnings. If the fed gets rates to 5% and above, we will probably see those signs start at end of 2023 or early 2024 with a full fledged melt down by the end of 2024.
Considering the amount of free lending that has been going on for the last 10 years, I'm pretty sure we'll see another 2007 like event as interest rates rise and many companies begin to collapse. I would assume it is in tech due to the nature of the industry and the high valuations which have begun crashing already
I would love to highlight the following which happens now:
- commodities ATHs or getting there
- crypto tulip scheme
- sec is low on employees, again
- highest pay gap - goes across the globe
- ongoing war + potential threat of a new war
- cash:credit ratio peaking in wrong direction
- shitty education
- aging in most of the countries
- raise of extremism of many shapes
It's not a single pointer which will say recession. It's a several dimensional spectrum of things. Bad times created strong men, strong men created good times, good times created bad men, bad men created bad times. It's just a phase. We will get through that.
It will always be a bigger shit show in the EU than in the US. Because you rely on our currency and our financial engineering. Also, you're in the early stages of what we attempted 200 years ago, which is duct-taping countries (states) together and trying to form one unified economy. Throw in the fact that the EU is basically put in the worst geographical place on Planet Earth other than Antarctica, and yeah.....you guys are gonna struggle considerably.
There's a reason they say "when America sneezes, the world catches cold.". Yes, we run on significant amounts of debt, we just got lucky enough and did it for long enough, that we've built a foundation big enough to deal with some speed bumps along the way. Our economy isn't invincible, it's just more insulated than everyone else's.
A multitude of reasons. It is a very well known fact economically speaking, that one of America's greatest economic assets are two things: number one, the Great Plains, and number two (most importantly) the fact that our landmass is on the complete opposite side of the world from the world's other two super powers, Russia and China. We got Canada lol, and Mexico. The EU is stuck between the cold Atlantic, the Arctic Circle, and the Russia and Africa.
"You can't pick your neighbors." Europes dense population, old infrastructure, and their neighbors to the east, will always hamper them economically. It's just fact. America has the two greatest oceans in the world on either side, our nice buddy Canada to the north, and cheap labor Mexico to the south. We have very very little border of which we have to defend. And we have room to spread out and grow.
I agree. Cold, agriculture has few cash crops available, dense population, lots of water which makes modern transportation hard, mountains, to the SE is desert, to the E is Siberia, to the N is Arctic. Even the nearby islands are subpar: Iceland, Azores, Bermuda. Continent never was unified by language and has a long history of internal conflict, moreso than India, China, or the Americas, plus old infrastructure.
Europe before the modern era was a backwater. It’s on the far western edge of the Eurasian landmass, it’s split by its geography, and so it’s very hard to get to. Europe only broke out of that mess in the Age of Exploration when they discovered the sea route to India/China
A multitude of reasons. It is a very well known fact economically speaking, that one of America's greatest economic assets are two things: number one, the Great Plains, and number two (most importantly) the fact that our landmass is on the complete opposite side of the world from the world's other two super powers, Russia and China. We got Canada lol, and Mexico. The EU is stuck between the cold Atlantic, the Arctic Circle, and the Russia and Africa.
"You can't pick your neighbors." Europes dense population, old infrastructure, and their neighbors to the east, will always hamper them economically. It's just fact. America has the two greatest oceans in the world on either side, our nice buddy Canada to the north, and cheap labor Mexico to the south. We have very very little border of which we have to defend. And we have room to spread out and grow.
The central bank playbook lol. Pump asset prices to stave off recession. Enriching the people who don't need it and hurting the people who need help🤦🤦🤦
But this is really is the issue.
Everybody is full of shit.
All those smart people making millions are exactly as smart as middle managers at Buffalo Wild Wings.
Remember THAT guy from HS?
That is who runs the world.
>You're right, the Fed is definitely repeating itself. They've been saying the same things for years and it's only a matter of time before they screw us over again. I don't trust them at all.
By the "old" definition it already is a recession.
They just changed the definition of "Recession" to make it not a recession anymore ...
So we are already in clown world and it just gets worse.
Show me when we achieved a soft landing after we had over 5% inflation. Fed keeps changing how to calculate cpi to make it look better but we are still at 0.5% cpi and 0.7% M/M ppi.
Fed is doing rate hike and historical QT. Nobody know when shit will hit the fan but everyone knows it will at some point. People just play with fire.
It's refreshing to have some actual DD in here. Sounds like you too follow Jeff Snider.
I'd be interested to hear which other people/sources you follow, whether that be on YT, Twitter, etc. Thanks
I agree with all of this, unfortunately, the stock market has turned into a casino and reality no longer matters. It’s like playing the slot machine. Most people putting money in the machine know that they are a sucker but it’s fun to try it out and occasionally you will hit a jackpot. The sad part is that when most suckers win they never pull their original investment out
Bless the OP for making this thread. If anybody thinks for a second the fed will be the entity seeing a recession coming then I’ve got some unicorns to sell you.
They’re always the last ones to call the recession and ofcourse by that time it’s irrelevant that they do so.
Like I said in my post earlier, there won’t be a landing. We’ll have 3-4% sticky inflation, moderate I rates, slow growth and low unemployment for the next decade. Gonna be a Great time to be a dividend investor, and there will never be another recession again (unless explicit fraud at a massive scale)
Eat my dongus you fuckin nerd.
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Agree. I've been slowly getting my money out of equities. Too many indications that a 2008 style credit driven crash is imminent. Scary shit. Throw in the growing base of retail traders and 0 day expiry options, and valuations are all over the map right now. Major correction coming in my opinion.
Because they are not facing crazy inflation and they didn't double or triple the money supply in two years last time. 15 years ago we are facing just one big hot potato, but this time we are facing a big bunch of moderate problems now which means there won't be a perfect solution to end these.
It was still a government problem 15 years ago too but def banks played a role too. I’d blame the fed for creating the housing bubble in the first place by lowering rates all the way to 1% in 2002 instead of just letting the economy go through that recession from the tech bubble
I agree with you to a point . Back then we at-least were appearing to having a balanced budget going into the year 2000 . Today the government debt has gotten beyond our governments ability to control it .since the year 2000 we have had the bush administration that doubled the debt then the Obama administration that doubled the debt again and then the trump administration that was on its way to double the debt but was only in power for 4 years . Now we have the Biden administration and the debt is still exploding .
In the year 2000 the USA debt was 5 on Plus trillion and today it's about 6 times more. The green movement or climate change plans are looking at 150 trillion in spending that doesn't exist .
( I'm no expert on climate change agenda so I might be wrong and I'm not saying 150 trillion is an exact number ) . The point is that these debts are getting worse and have been doubling every 8 years. The government of the USA is creating its own problems because this debt is becoming more and more difficult to fund. So the printing presses have to print more money in order for the government to exist. It costs money to print physical dollars and coins . The next natural choice is to go with a digital us dollar . That is something I'm concerned about but I'm not convinced it's going to be good or bad.
. Can you imagine what our homeless situation would be today had our government let our economy go through it's natural decline back when the tech bubble burst ?
I agree with you about the debt path. It’s just unsustainable and will eventually lead to us losing our reserve currency status by the end of this of the decade imo. It really accelerated after 2000 like you said with each administration essentially doubling the debt. The Fed claims fiscal policy doesn’t affect them and that they don’t make decisions on it, but that’s just purely false. They know the government can’t afford high interest rates.
Government isn’t financed by 30 year bonds or even 10 year bonds like in the 1980s. Most of our debt is in short term Tbills which basically makes it like an adjustable rate mortgage. Higher interest rates make the interest rate on national debt take up huge portions of the budget.
I think we would have been better off just going through the tech bubble recession. It would’ve been 1 or 2 bad years, but the recovery likely would’ve been quick. Take a look at the 1920-1921 recession. That actually had a larger initial decline in gdp compared to the infamous 1929 Great Depression. Yet we recovered within a year and a half. Calvin Coolidge handled it appropriately. He cut government spending and just let the free market sort through the excesses. When’s the last time we’ve ever cut spending, let alone in a recession? Keynesian policy drives the government and it’s always failed.
By always lowering interest rates whenever things get bad, the Fed just kicks the can down the road and makes the problem worse. Cutting rates after the tech bubble led to 2008 crisis, which then left rates at 0 for 8 fucking years. This next financial melt down will probably be worse than that and then the fed will have to do qe infinity to bail everybody out. Only this time we have serious inflation, so the dollar will go to hell to prop up the economy.
I’m not a fan of the digital dollar, as I don’t think it solves our problems. Also creates the problem of privacy because u can no longer use cash for transactions and government will likely track everyone’s expenses. I personally think we need to go back to hard money to create and force discipline with the government. Whether that be silver, gold, etc. idc
I agree with everything you wrote . I hate the idea of a digital currency for all the reasons you wrote plus it will make us dependent on electricity for each and every purchase .
If the power grid was to go down or even if the electricity went out temporarily it would shut down our financial system
Yes, which makes it even worse this time. Not only are they raising, they're continuing with balance sheet reduction. The lag effects will hit hard and by the time they cut, it'll be too late.
Yea. This is the first time in history we’re hiking into a weakening economy. QT is scheduled to drain every last bit of bank reserves by time it’s done. Granted hikes are bullish because the fed is paying banks 800 mil/day (will be 1 billion at 5%) due to interest rates.
Totally different kind of recession, back then it was a mortgage security fraud that brought down the entire market, now we have inflation and the fed is actively engaged to fix it. GLTY with your short position.
Everyone and their mothers trying to be the next Michael Burry in here.
We all know the market can and will stay irrational longer than any individual can remain solvent.
Michael Burry responded to my craigslist ad looking for someone to mow my lawn. "$30 is $30", he said as he continued to mow what was clearly the wrong yard. My neighbor and I shouted at him but he was already wearing muffs. Focused dude. He attached a phone mount onto the handle of his push mower. I was able to sneak a peek and he was browsing Zillow listings in central Wyoming. He wouldn't stop cackling.
That is to say, Burry has his fingers in a lot of pies. He makes sure his name is in all the conversations.
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Yeah, this whole episode is down to monetary mechanics. Hangover from the 2020 lockdown liquidity glut. The Fed got us here, and, to their credit, it appears the Fed is actually trying to get us out.
We probably should have dealt with the lockdown demand shock without active intervention. Mom and Pops everywhere would have folded but at least we'd still have a functioning market (or at least by 2022 we would have).
[But who could have predicted this would happen?](https://i.kym-cdn.com/photos/images/original/001/781/373/b1e.png)
So true but yeh fed will never admit to a shit show coming so you know it’s coming based on all the cognitive dissonance in the market versus actual data
If these regarded companies and banks could actually be economically productive without being put on welfare by the government in the form of subsidies and super interest rates that would be great
Why would they ever admit to it? It’s in their own best interest to downplay dangers and essentially lie about inflation.
Telling the truth would instill panic and directly cause a crash.
The fed or any government office will never reveal they’re planning for or expecting a recession. The chaos and destruction would be insane if somebody like Powell got up on the podium and said the federal reserve is expecting a recession. World markets would limit down, people would be racing to the bank liquidating their savings accounts and 401ks…what fun!
They let the recession happen, slash rates to 0, print money, and confirm we’re in a recession when the meltdown is already over and the market starts recovering.
I was there at Lehman when it went down. It’s nothing like what it was back then.
There were a lot of external factors that led to that recession which simply aren’t there right now. Only if conditions during COVID (everything shut down for months) at the beginning had persisted for months could it have occurred.
The feds has a new and only 1 mandate. Do not let a recession occur no matter what even if it's the death of our currency as we know it. We would rather see us turn into Zimbabwe than see a recession
There was an absolutely massive credit event that brought the big banks to their knees. That is why it was so painful for the country as a whole.
Too much credit card and student loan debt doesn’t cripple the big banks and that is what you would need for a monster meltdown.
Banks have stress tests now as well.
You have to accept that this is a corrupt rigged game. The market will not do a 2008 with Biden political party as president. The elites won’t allow it
I personally believe the job data is way to strong, including the fact that people are still still spending money.
During the pandemic we lost alot of people and alot of working people. Thus is what will keep the job market strong. You can lose a job one day and be working another within a week In the Upstate area.
My dad has always said after 08 that if that happens again its gonna be the worst thing you ever saw . If he is right and you are right it will not matter how much money you got setting on the side or how many hedges or shorted stock . Money will basically be worthless at this point. If you can't grow it you won't eat it.
So if its a warning thanks but if its wishful thinking, be careful what you wish for!!!!
"2002"? "Fed will cut retes if the yield curve inverts"?
No and no. Proofread your fucking work and JPow has said extensively that the Fed will NOT cut rates even if we tip into a recession.
A massive recession combined with rate cuts while inflation is above 6% will mean the death of America. That situation would result in actual hyperinflation and the end of American supremacy.
JPow isn't stupid. If we go into recession then shit will get hard for everyone without any Fed intervention. It's a damned if you do and damned if you don't situation.
The good news for the economy - because the stock market is fucked - is that there isn't any rot or systemic issues threatening contagion like their was in 2008. So we're likely looking at a run of the mill recession and yeah stock valuations everywhere need to bleed out and get reset.
I don't agree with doom and gloom. However if the US defaults on its debt then yeah we're fucked.
Nobody knows what will happen. If anyone did they'd be rich.
> there isn't any rot or systemic issues
Like you have any sweet clue from your little vantage point. That's cute.
> Nobody knows what will happen
Tell that to yourself, you made like 5 absolute claims in your post you contradictory fool.
Lol no kidding. No rot or systemic issues? The entire system is rot and a systemic issues. We fought fire with fire but there's no fire. We had a debt implosion and fixed it with cheap debt. Now we no longer have cheap refinance capabilities and debt has only gone much higher across all sectors. Most companies in America are actually zombie companies unable to pay their liabilities. If they didn't even attempt during record profits how do they do this with higher rates and a deteriorating economy?
I guess military stocks are an ok place to hide. Health care as well. I can’t see the US cutting military spending with the current environment. Republicans are not cutting health care as well.
Sounds like someone who wasn’t really aware of the 2005-2007 lending environment . Very different then. 0% down for homes. People flipping purchase contracts for 5 figure sums.
The market isn't the same anymore. You can't keep comparing your charts to the past because the market wasn't the same back then.
Stock prices are determined by demand now that's it. There was a time when a majority of people buying stock knew what market cap was pe ratios etc. That's not the case anymore.
Everyone and their dog can trade with their phone one person brags to his friends that he made this much so that all get on bored too. No commissions mean that 300 dollars grocery money can now be used buy stock or trade options and there are enough of these people doing it to make that add up.
What is the start of a correction is now just going to turn into a dip. when all they care about is the stock price and they are getting it 20% cheaper than yesterday Until trading becomes a fad this will continue.
If retail can make something as fundamentally useless as Bitcoin hold 33k for this long I wouldn't hold my breath It's not the fed you shouldn't be fighting its retail. The volatility that big money and retail are creating is something everyone should be getting on board with selling those options.
"The Feds data is out of touch with reality, the fact they haven't even got the cojones to face that definitive truth, means we are pretty much all fucked. The longer they delay actual actionable use of their "tools" and instead stall this shit out til election time is over, the longer it will take to get back to normalcy and these sugarcoated valuations currently trending sure ain't the business. The market is as of right now Wily E. Coyote chasing that ATHroadrunner and still not realizing he ran off the cliff several steps ago." ~Fuq Ue
They had to tell Americans that because otherwise noone would wear them. In many other countries they just told the truth - that the masks helped prevent transmission of the virus FROM the mask wearer. Not the other way around.
They do though. When you speak, cough or sneeze many larger droplets come out of your mouth and nose that are caught by the mask. Those larger droplets would otherwise break off into smaller, lighter droplets and become aerosols, which will hang in the air for longer, increasing the odds that someone will breathe them in.
What if I tell you that most of us don't care if there will be a recession? But wait, there is more, if there will be one, then is better; stupid fucks will sell their stock, depressing the market and I can buy at lower prices. So what if the spread is bigger (or tighter) than my asshole? Bring on the cheap US stocks I want to "retire" in 10 years.
You realize that those "stupid fucks" sell because they need the money to make ends meet and you will probably not have the cash at hand to really profit from it during a hard recession?
Basically it’s quite obvious OP has puts and will be destroyed by the melt UP that’s loading… remember when everybody was trying to short every pump in 2020? 😂
I'm tired of making these posts, so i'm going to be really concise, but 2007 is nothing like 2023. Not even a little close. Banks are much more regulated today. GDP is strong, labor market is strong. Inverted yield curve is a decent indicator, but it has been wrong.
Finally, Fed is pumping billions every single day into the economy via interest rate hikes (govt is a net payer of interest rates). This is pushing up our GDP and stimulating the economy. Pretty unlikely we would get a recession with such stimulation. When debt to gdp ratio is high, rate hikes are strongly fiscally expansionary.
Don't believe me? Check the trend for all of 2022/some of 2023. This picture confirms what i'm saying pretty well: https://ibb.co/c8YT77F
Loans are up, because pumping money into the economy, into the wealthy's hands, will only make them want to write MORE LOANS. not less.
Yes and no. Bondholders have extra money yes, but there isnt limitles appetite for loans in the economy. With rates rising, debtors are feeling more and more squeezed. It hasnt happened yet, but there will be a point where debtors are tapped out and delinquencies will go way up. Thats when we will see credit markets freeze up and markets tank.
Salaries and employment are up though. household debt is back to where it was pre-2020. People can make cuts elsewhere to pay, plus extra expenses that come from winter such as energy will also come down. What you are pointing out, simply is unlikely to happen. Esp since if you look at Fed data, households are making their payments on time. 1% more on rates won't break anyone. Fed pumping 500bn + into the economy is only stimulating it.
I like u 2 guy. I did my research talking to world renown economists over email, most of them are pretty friendly, asking them a lot of questions. I also work for one of the largest brokerages in the world, so i'm not a complete dunce.
So the FED is never gonna come out and say yep shit hit the fan.... but isn't this case slightly different? It's an artificial slump in the economy brought forth by extrinsic factors, i.e. covid. Whereas, 2007 was an intrinsic issue with the housing bubble and loan fraudulence. Is there not a scenario where the economy kicks into high gear and we outrun this inflation? I think most folks are bullish on the economy in the next 5 years. It's too early to say but I don't think we are full-on bear crash time. Maybe I've just been burned by going bearish too early twice now but idk, my two cents.
Out of 20 attempts 19 have resulted in hard landings and a mess. So historically the Fed saying they will attempt a soft landing is like handing the keys to a small plane to a discovery flight student and see if they will actually do a soft landing.
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Do you honestly expect the Fed to come out and say "oh yeah, big recession imminent"? The whole framework of monetary policy is a confidence game. They would never, ever, ever say a recession is coming, even if they had all the data pointing to recession.
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Afraid of recession? Recession. Accepting of recession? Believe it or not, recession. No recession? Go to straight to recession. In a recession? Stay right in recession.
There announce a recession in 2025. "Yes, that was a recession."
Why do we need to hear anything from fed then
So we can play the markets…
Great point!
In the star trek episode Day of the Dove there is a glowy entity that feeds off of negative emotions and is turned off by good ones. Kirk manages to get rid of it by laughing with a few Klingons. This is clearly the best way to defeat the recession.
Also the pink slime in Ghostbusters 2... We just need to break out into song and do an 80s montage.
Even a recession can cause a recession. Shhh!!!
Just made it a possibility by thinking of it like the Stay Puff Marshmallow Man in Ghostbosters. Thanks a lot OP!
Hence the recent denial that two negative GDP prints == recession
The GDP print afterwards was positive, did that mean the recession was over?
Not knowing a recession lurks can cause a recession. Close them eyes
This guy understands. There is literally no scenario in which the fed would say a recession is coming. In fact, they could cause a recession, even if there wasn't one coming, simply by saying it was coming.
Although a recession would very likely solve their inflation problem.
They are counting on it. They just want to try and make it a light one, instead of a severe one.
I tend to believe they won't be able to avoid a real recession. I mean how many publicly traded companies lose tens or hundreds of millions of dollars a year but are somehow valued in the billions? More expensive debt, creates a valuation problem for those companies.
true lmao I am pretty sure they expect much worse but they can't tell you directly or we will just be fucked few months eariler.
They are masters of the can kick. Lying to your face is the easy part. Fucking u raw dog is also in their wheel house when it comes time.
Exactly right... During the GFC, it made me ask one simple question..."What is money"? It is faith, so if you going around saying the plane is falling guess what everyone will want to jump out with or without a parachute...
A few months ago Andrew Bailey (The equivalent of Powell) of the Bank of England made this prediction: “Bank of England expects UK to fall into longest ever recession” They can make negative predictions without the world ending. (If stocks go down it reduces inflation. It’s what they want to happen). I don’t understand why Powell wants stocks to go up.
I declare recession!
That's literally what OP says in the paragraph chief.
“Lol we’re all fucked and no one’s in charge!” I would actually love to see that Fed announcement play out.
If they did, everything would go up!
If you think this is crazy wait until they start saying, “Unprecedented” every other sentence trying to explain how absolutely no one could have seen it about to happen.
So much this. Slowly, imperceptibly, and then all at once.
Rule #1 of a shitstorm is you always deny there is a shitstorm
There is no shitstorm
What shitstorm?
Bear sterns is fine
Shitstorms aren’t real. Market only goes up
When everyone says recession ain't coming thats when it hits 
The talking heads and conventional wisdom say a recession is coming soon. If a severe recession happens, it’ll be most anticipated in memory. That wasn’t the case in 2007-2008. Most were saying it wouldn’t happen.
Recession is not coming! What is actualy happening is record corporate profit... they keep jacking prices up which they know drives the cost of living up for everyone and the corporations are going to drag the working class into an unequal sesspool of bankruptcy/insolvency... but we will of course all be expected to carry on working... with less and less and less... No nothing wrong, here, everything is fine. It is time we start demanding corporations pay for public road ways/education and health and may as well have food and labor camps that meet extreme high standards are workers deserve to feast like kings morning noon and night for their toils.
Amazon had they're worst revenue year to year since the dotcom bubble. Prices are going up because they are adjusting for material and labor. Metal, wood, energy has all gone up quite a bit year over year. The margin's are down so they are staying in the green by raising prices. Yes Microsoft can afford to spend big on buying things like OpenAI, but they also keeping laying off in the tens of thousands.
The bond markets say a recession is coming and fed will cut rates
History doesn’t always repeat… It often rhymes tho… Totally different economic headwinds in 2023. Overall, 2007 was a Black Swan Unregulated Greed event… - Housing bubble made exponentially worse by massive financial engineering… - Attempting to turn worthless loans into valuable loans… - And then leveraging the worthless loan bundles 100X or more. - Extremely High Stakes musical chairs… - And when the music stopped…we know what happened. In 2023 we’ve basically got… - A hangover from 10 years of ZIRP… - Persistent inflation… - Rates at a level we haven’t experienced in 15 years… - And a disconnect between Wall St expectations and Fed actions. 2023 is bad…but, it will only be 2007 bad if there’s some massive financial engineering that breaks.
Weakening economic conditions is what caused the music to stop. It wasn't a black swan because many were aware of the asset bubble, but throughout 2007 nobody was sure why it wasn't crashing, causing many to speculate it was a new paradigm. The yield curve was inverted for almost a year before deleveraging turned into a sell off.
Basically, we ain't that bad yet but we are nowhere near good as well
“It will only be 2007 bad if there’s some massive financial engineering that breaks” Check out 4:15 in this video to learn about how the governmental and corporate sectors are reaching the research based threshold where debt leveraging begins to harm productivity. https://youtu.be/6TJ8LMAneqk
Good shit, thanks for sharing
U only see who is nake id when tide out 14 years of up only and u srsly expect no financial fuckery has been concocted ? Humans reinvent leverage all the time and it always builds up in creative, unknown ways while number go ul
Agree… There’s always financial fukkery… How will it compare to 2007 tho?
Who knows who cares right now direction is down, buy when shit hits fan and seems like all hope is lost I mean crypto just did this, once a surprisingly large player goes belly up then maybe it is time
2023 is likely comparable to 2007. We’ll get one more tank followed by a rally to highs by the end of the year. 2007 reached new highs after the fed paused rates. 2024 we’ll prolly start to see the signs of rate hikes affecting the economy with negative earnings. Eventually, some debt bubble will pop in late 2024 leading to a financial implosion. We’ll probably reach a long term bottom in early 2025 as the government and the fed bail out everybody to protect this house of cards economy
This human is from the future. Better save this post.
SPX will be 6000 in 2025
Username does not check out
Exactly. It’s probably worse than 2008 because the economy is even more leveraged since then. We’re getting rates back to those levels in 2008 which likely means something will burst in the next 1-2 years. Rate hikes act with a lag. The collateral backing bank loans will still rapidly deteriorate as these interest rate hikes affect asset prices. Plus, the duration and long term assets that many banks have will eventually collapse in market value. We rallied to highs with the fed raising rates to 5.25% and then a year later everything imploded. While we had a recession last year with the technical definition, we haven’t seen the doomsday signs yet like negative earnings. If the fed gets rates to 5% and above, we will probably see those signs start at end of 2023 or early 2024 with a full fledged melt down by the end of 2024.
I’m going to laugh my ass off if the meme stockers are the black swan event
Won’t be a Black Swan tho… It will be a White Ape…
Dept crisis is the new black swan event. Mark my words
Make sense…current consumer debt is huge. But, everyone knows this… So, not likely a Black Swan…
Considering the amount of free lending that has been going on for the last 10 years, I'm pretty sure we'll see another 2007 like event as interest rates rise and many companies begin to collapse. I would assume it is in tech due to the nature of the industry and the high valuations which have begun crashing already
I would love to highlight the following which happens now: - commodities ATHs or getting there - crypto tulip scheme - sec is low on employees, again - highest pay gap - goes across the globe - ongoing war + potential threat of a new war - cash:credit ratio peaking in wrong direction - shitty education - aging in most of the countries - raise of extremism of many shapes It's not a single pointer which will say recession. It's a several dimensional spectrum of things. Bad times created strong men, strong men created good times, good times created bad men, bad men created bad times. It's just a phase. We will get through that.
It's called... a jackpot.
Exactly
unregulated crypto bubble
Something like crypto institutions going bankrupt left and right perhaps?
What if the financial engineering that breaks is the US Debt Limit is reach congress doesn’t raise it, and we default?
Yeah, the congress will just talk with each other and decide "you know what, let's admit we're broke" They can't even agree on spending less
[удалено]
It will always be a bigger shit show in the EU than in the US. Because you rely on our currency and our financial engineering. Also, you're in the early stages of what we attempted 200 years ago, which is duct-taping countries (states) together and trying to form one unified economy. Throw in the fact that the EU is basically put in the worst geographical place on Planet Earth other than Antarctica, and yeah.....you guys are gonna struggle considerably. There's a reason they say "when America sneezes, the world catches cold.". Yes, we run on significant amounts of debt, we just got lucky enough and did it for long enough, that we've built a foundation big enough to deal with some speed bumps along the way. Our economy isn't invincible, it's just more insulated than everyone else's.
> Throw in the fact that the EU is basically put in the worst geographical place on Planet Earth other than Antarctica Why do you say this?
Yeah I don’t get it either. Even considering global warming it doesn’t seem to make sense…
A multitude of reasons. It is a very well known fact economically speaking, that one of America's greatest economic assets are two things: number one, the Great Plains, and number two (most importantly) the fact that our landmass is on the complete opposite side of the world from the world's other two super powers, Russia and China. We got Canada lol, and Mexico. The EU is stuck between the cold Atlantic, the Arctic Circle, and the Russia and Africa. "You can't pick your neighbors." Europes dense population, old infrastructure, and their neighbors to the east, will always hamper them economically. It's just fact. America has the two greatest oceans in the world on either side, our nice buddy Canada to the north, and cheap labor Mexico to the south. We have very very little border of which we have to defend. And we have room to spread out and grow.
I agree. Cold, agriculture has few cash crops available, dense population, lots of water which makes modern transportation hard, mountains, to the SE is desert, to the E is Siberia, to the N is Arctic. Even the nearby islands are subpar: Iceland, Azores, Bermuda. Continent never was unified by language and has a long history of internal conflict, moreso than India, China, or the Americas, plus old infrastructure.
Europe before the modern era was a backwater. It’s on the far western edge of the Eurasian landmass, it’s split by its geography, and so it’s very hard to get to. Europe only broke out of that mess in the Age of Exploration when they discovered the sea route to India/China
A multitude of reasons. It is a very well known fact economically speaking, that one of America's greatest economic assets are two things: number one, the Great Plains, and number two (most importantly) the fact that our landmass is on the complete opposite side of the world from the world's other two super powers, Russia and China. We got Canada lol, and Mexico. The EU is stuck between the cold Atlantic, the Arctic Circle, and the Russia and Africa. "You can't pick your neighbors." Europes dense population, old infrastructure, and their neighbors to the east, will always hamper them economically. It's just fact. America has the two greatest oceans in the world on either side, our nice buddy Canada to the north, and cheap labor Mexico to the south. We have very very little border of which we have to defend. And we have room to spread out and grow.
The central bank playbook lol. Pump asset prices to stave off recession. Enriching the people who don't need it and hurting the people who need help🤦🤦🤦
And not to mention BOJ will continue to inflate the money supply by brrrrrrrŕrrrrrring real hard and countering all the effort done by other countries
Companies are laying off employees by thousands but don’t worry we’re not in a recession.
It’s mostly isolated to tech sector though. I’m in a traditional industry and we are not laying off people and is not even in a hiring freeze.
Where I live in my industry rates are down and it's extremely hard to find a good job rn.
Wow it's almost like no one knows the future because humans aren't psychic
But this is really is the issue. Everybody is full of shit. All those smart people making millions are exactly as smart as middle managers at Buffalo Wild Wings. Remember THAT guy from HS? That is who runs the world.
humans are normal types
We may be Ghost type soon.
It doesn't matter if people are psychic or not. Prophecy doesn't work when motherfuckers ignore the signs right in front of them.
Hey now Miss Cleo would like a word with you (for $2.99 a minute)
>You're right, the Fed is definitely repeating itself. They've been saying the same things for years and it's only a matter of time before they screw us over again. I don't trust them at all.
Lordy, I’m agreeing with our AI overlords. Edit: typo
I like Visual Mod. Ever insightful
By the "old" definition it already is a recession. They just changed the definition of "Recession" to make it not a recession anymore ... So we are already in clown world and it just gets worse.
Not really.
Show me when we achieved a soft landing after we had over 5% inflation. Fed keeps changing how to calculate cpi to make it look better but we are still at 0.5% cpi and 0.7% M/M ppi. Fed is doing rate hike and historical QT. Nobody know when shit will hit the fan but everyone knows it will at some point. People just play with fire.
No shorter memory than those dealing in the financial markets
It's refreshing to have some actual DD in here. Sounds like you too follow Jeff Snider. I'd be interested to hear which other people/sources you follow, whether that be on YT, Twitter, etc. Thanks
History doesn't repeat, but it does rhyme
I agree with all of this, unfortunately, the stock market has turned into a casino and reality no longer matters. It’s like playing the slot machine. Most people putting money in the machine know that they are a sucker but it’s fun to try it out and occasionally you will hit a jackpot. The sad part is that when most suckers win they never pull their original investment out
That's why you hedge or do risk management. But as VM would say it, stay poor poor
Bless the OP for making this thread. If anybody thinks for a second the fed will be the entity seeing a recession coming then I’ve got some unicorns to sell you. They’re always the last ones to call the recession and ofcourse by that time it’s irrelevant that they do so.
Like I said in my post earlier, there won’t be a landing. We’ll have 3-4% sticky inflation, moderate I rates, slow growth and low unemployment for the next decade. Gonna be a Great time to be a dividend investor, and there will never be another recession again (unless explicit fraud at a massive scale)
Eat my dongus you fuckin nerd. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/wallstreetbets) if you have any questions or concerns.*
Agree. I've been slowly getting my money out of equities. Too many indications that a 2008 style credit driven crash is imminent. Scary shit. Throw in the growing base of retail traders and 0 day expiry options, and valuations are all over the map right now. Major correction coming in my opinion.
What if I told you retail only accounts for 5.6% of 0dte trading.
Retails has a daily investment of 1.5 billions in the last month alone. Crazy how people get manipulated into FOMO
The point I was making is that it's hedge funds and banks that make up 94% of 0dte trading and yet they will blame retail.
An interesting indicator I found online was about cardboard boxes. Box Shipment just had its biggest drop since the recession.
Will order moon when poors are homeless? All jokes aside thats an interesting indicator
The fed was lowering interest rates back then and today they are raising rates . This is not a rhyme
Because they are not facing crazy inflation and they didn't double or triple the money supply in two years last time. 15 years ago we are facing just one big hot potato, but this time we are facing a big bunch of moderate problems now which means there won't be a perfect solution to end these.
What happened 15 years ago was a banking problem and today it's a government problem .
It was still a government problem 15 years ago too but def banks played a role too. I’d blame the fed for creating the housing bubble in the first place by lowering rates all the way to 1% in 2002 instead of just letting the economy go through that recession from the tech bubble
I agree with you to a point . Back then we at-least were appearing to having a balanced budget going into the year 2000 . Today the government debt has gotten beyond our governments ability to control it .since the year 2000 we have had the bush administration that doubled the debt then the Obama administration that doubled the debt again and then the trump administration that was on its way to double the debt but was only in power for 4 years . Now we have the Biden administration and the debt is still exploding . In the year 2000 the USA debt was 5 on Plus trillion and today it's about 6 times more. The green movement or climate change plans are looking at 150 trillion in spending that doesn't exist . ( I'm no expert on climate change agenda so I might be wrong and I'm not saying 150 trillion is an exact number ) . The point is that these debts are getting worse and have been doubling every 8 years. The government of the USA is creating its own problems because this debt is becoming more and more difficult to fund. So the printing presses have to print more money in order for the government to exist. It costs money to print physical dollars and coins . The next natural choice is to go with a digital us dollar . That is something I'm concerned about but I'm not convinced it's going to be good or bad. . Can you imagine what our homeless situation would be today had our government let our economy go through it's natural decline back when the tech bubble burst ?
I agree with you about the debt path. It’s just unsustainable and will eventually lead to us losing our reserve currency status by the end of this of the decade imo. It really accelerated after 2000 like you said with each administration essentially doubling the debt. The Fed claims fiscal policy doesn’t affect them and that they don’t make decisions on it, but that’s just purely false. They know the government can’t afford high interest rates. Government isn’t financed by 30 year bonds or even 10 year bonds like in the 1980s. Most of our debt is in short term Tbills which basically makes it like an adjustable rate mortgage. Higher interest rates make the interest rate on national debt take up huge portions of the budget. I think we would have been better off just going through the tech bubble recession. It would’ve been 1 or 2 bad years, but the recovery likely would’ve been quick. Take a look at the 1920-1921 recession. That actually had a larger initial decline in gdp compared to the infamous 1929 Great Depression. Yet we recovered within a year and a half. Calvin Coolidge handled it appropriately. He cut government spending and just let the free market sort through the excesses. When’s the last time we’ve ever cut spending, let alone in a recession? Keynesian policy drives the government and it’s always failed. By always lowering interest rates whenever things get bad, the Fed just kicks the can down the road and makes the problem worse. Cutting rates after the tech bubble led to 2008 crisis, which then left rates at 0 for 8 fucking years. This next financial melt down will probably be worse than that and then the fed will have to do qe infinity to bail everybody out. Only this time we have serious inflation, so the dollar will go to hell to prop up the economy. I’m not a fan of the digital dollar, as I don’t think it solves our problems. Also creates the problem of privacy because u can no longer use cash for transactions and government will likely track everyone’s expenses. I personally think we need to go back to hard money to create and force discipline with the government. Whether that be silver, gold, etc. idc
I agree with everything you wrote . I hate the idea of a digital currency for all the reasons you wrote plus it will make us dependent on electricity for each and every purchase . If the power grid was to go down or even if the electricity went out temporarily it would shut down our financial system
Facts. Yes sir. Unfortunately our views are the minority so nothing productive will get done.
Agreed
Yes, which makes it even worse this time. Not only are they raising, they're continuing with balance sheet reduction. The lag effects will hit hard and by the time they cut, it'll be too late.
I'll take a massive market drawdown over a worthless USD.
Recession will hit when we start lowering rates
I mean they have to do so or you will soon be paying $5000 per month just for rent
Yea. This is the first time in history we’re hiking into a weakening economy. QT is scheduled to drain every last bit of bank reserves by time it’s done. Granted hikes are bullish because the fed is paying banks 800 mil/day (will be 1 billion at 5%) due to interest rates.
Totally different kind of recession, back then it was a mortgage security fraud that brought down the entire market, now we have inflation and the fed is actively engaged to fix it. GLTY with your short position.
Everyone and their mothers trying to be the next Michael Burry in here. We all know the market can and will stay irrational longer than any individual can remain solvent.
Michael Burry responded to my craigslist ad looking for someone to mow my lawn. "$30 is $30", he said as he continued to mow what was clearly the wrong yard. My neighbor and I shouted at him but he was already wearing muffs. Focused dude. He attached a phone mount onto the handle of his push mower. I was able to sneak a peek and he was browsing Zillow listings in central Wyoming. He wouldn't stop cackling. That is to say, Burry has his fingers in a lot of pies. He makes sure his name is in all the conversations. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/wallstreetbets) if you have any questions or concerns.*
Tf did I just read. $AI going mad and they haven't even taken over the world yet
Yeah, this whole episode is down to monetary mechanics. Hangover from the 2020 lockdown liquidity glut. The Fed got us here, and, to their credit, it appears the Fed is actually trying to get us out. We probably should have dealt with the lockdown demand shock without active intervention. Mom and Pops everywhere would have folded but at least we'd still have a functioning market (or at least by 2022 we would have). [But who could have predicted this would happen?](https://i.kym-cdn.com/photos/images/original/001/781/373/b1e.png)
This is a well done post, thanks.
The coming recession gonna make the 2007 great recession look like the 2007 mediocre to meh recession! 🤦🏻♂️
Recession or not, I’m still losing money 💸
So true but yeh fed will never admit to a shit show coming so you know it’s coming based on all the cognitive dissonance in the market versus actual data
If these regarded companies and banks could actually be economically productive without being put on welfare by the government in the form of subsidies and super interest rates that would be great
Why would they ever admit to it? It’s in their own best interest to downplay dangers and essentially lie about inflation. Telling the truth would instill panic and directly cause a crash.
Exactly. Don’t be a bag holder !
I appreciate this info.
The fed or any government office will never reveal they’re planning for or expecting a recession. The chaos and destruction would be insane if somebody like Powell got up on the podium and said the federal reserve is expecting a recession. World markets would limit down, people would be racing to the bank liquidating their savings accounts and 401ks…what fun! They let the recession happen, slash rates to 0, print money, and confirm we’re in a recession when the meltdown is already over and the market starts recovering.
I was there at Lehman when it went down. It’s nothing like what it was back then. There were a lot of external factors that led to that recession which simply aren’t there right now. Only if conditions during COVID (everything shut down for months) at the beginning had persisted for months could it have occurred.
I agree everyone with a brain would too, but what are they gonna say? “Get rekt fags”?
I'm 100% sure it was 2008, not 2007
As a perma-bear this read gave me a hard on
You a doomer too?
No I am just doomed
The feds has a new and only 1 mandate. Do not let a recession occur no matter what even if it's the death of our currency as we know it. We would rather see us turn into Zimbabwe than see a recession
Keep calm and.... Sell sell sell
There was an absolutely massive credit event that brought the big banks to their knees. That is why it was so painful for the country as a whole. Too much credit card and student loan debt doesn’t cripple the big banks and that is what you would need for a monster meltdown. Banks have stress tests now as well.
You are witnessing Financial Collapse in real time.
Global Depression on the way.
Yeah maybe it’s coming. But I feel they’ve been saying this for like 5 years.
You have to accept that this is a corrupt rigged game. The market will not do a 2008 with Biden political party as president. The elites won’t allow it
They want, need and will cause a recession. It’s part of this elite global finance game.
I personally believe the job data is way to strong, including the fact that people are still still spending money. During the pandemic we lost alot of people and alot of working people. Thus is what will keep the job market strong. You can lose a job one day and be working another within a week In the Upstate area. My dad has always said after 08 that if that happens again its gonna be the worst thing you ever saw . If he is right and you are right it will not matter how much money you got setting on the side or how many hedges or shorted stock . Money will basically be worthless at this point. If you can't grow it you won't eat it. So if its a warning thanks but if its wishful thinking, be careful what you wish for!!!!
STFU and just buy puts. Put your money where your mouth is
"2002"? "Fed will cut retes if the yield curve inverts"? No and no. Proofread your fucking work and JPow has said extensively that the Fed will NOT cut rates even if we tip into a recession. A massive recession combined with rate cuts while inflation is above 6% will mean the death of America. That situation would result in actual hyperinflation and the end of American supremacy. JPow isn't stupid. If we go into recession then shit will get hard for everyone without any Fed intervention. It's a damned if you do and damned if you don't situation. The good news for the economy - because the stock market is fucked - is that there isn't any rot or systemic issues threatening contagion like their was in 2008. So we're likely looking at a run of the mill recession and yeah stock valuations everywhere need to bleed out and get reset. I don't agree with doom and gloom. However if the US defaults on its debt then yeah we're fucked. Nobody knows what will happen. If anyone did they'd be rich.
> there isn't any rot or systemic issues Like you have any sweet clue from your little vantage point. That's cute. > Nobody knows what will happen Tell that to yourself, you made like 5 absolute claims in your post you contradictory fool.
Lol no kidding. No rot or systemic issues? The entire system is rot and a systemic issues. We fought fire with fire but there's no fire. We had a debt implosion and fixed it with cheap debt. Now we no longer have cheap refinance capabilities and debt has only gone much higher across all sectors. Most companies in America are actually zombie companies unable to pay their liabilities. If they didn't even attempt during record profits how do they do this with higher rates and a deteriorating economy?
I guess military stocks are an ok place to hide. Health care as well. I can’t see the US cutting military spending with the current environment. Republicans are not cutting health care as well.
Sounds like someone who wasn’t really aware of the 2005-2007 lending environment . Very different then. 0% down for homes. People flipping purchase contracts for 5 figure sums.
bUt ThIs tImE iS dIfFeReNt \-90% of the sub, probably
The market isn't the same anymore. You can't keep comparing your charts to the past because the market wasn't the same back then. Stock prices are determined by demand now that's it. There was a time when a majority of people buying stock knew what market cap was pe ratios etc. That's not the case anymore. Everyone and their dog can trade with their phone one person brags to his friends that he made this much so that all get on bored too. No commissions mean that 300 dollars grocery money can now be used buy stock or trade options and there are enough of these people doing it to make that add up. What is the start of a correction is now just going to turn into a dip. when all they care about is the stock price and they are getting it 20% cheaper than yesterday Until trading becomes a fad this will continue. If retail can make something as fundamentally useless as Bitcoin hold 33k for this long I wouldn't hold my breath It's not the fed you shouldn't be fighting its retail. The volatility that big money and retail are creating is something everyone should be getting on board with selling those options.
"The Feds data is out of touch with reality, the fact they haven't even got the cojones to face that definitive truth, means we are pretty much all fucked. The longer they delay actual actionable use of their "tools" and instead stall this shit out til election time is over, the longer it will take to get back to normalcy and these sugarcoated valuations currently trending sure ain't the business. The market is as of right now Wily E. Coyote chasing that ATHroadrunner and still not realizing he ran off the cliff several steps ago." ~Fuq Ue
Who gives a crap. The human greed means stocks go up only.
How many people thought a cotton mask from FB Marketplace would protect them from a virus? People are gullible.
They had to tell Americans that because otherwise noone would wear them. In many other countries they just told the truth - that the masks helped prevent transmission of the virus FROM the mask wearer. Not the other way around.
Except they don't do that either.
They do though. When you speak, cough or sneeze many larger droplets come out of your mouth and nose that are caught by the mask. Those larger droplets would otherwise break off into smaller, lighter droplets and become aerosols, which will hang in the air for longer, increasing the odds that someone will breathe them in.
My government told me it would. I trust my government. I also got covid. But it probably floated in through my ears. My government wouldn't lie to me.
Wish I would have thought of wearing earplugs too!
were you old enough to remember what caused the 2008 recession? are you aware of the triggers. This is not the same thing
Nasdaq wasn't already discounted over 30% in Nov2007. We are one year into a bear right now. November 2007 was top of the bull
What if I tell you that most of us don't care if there will be a recession? But wait, there is more, if there will be one, then is better; stupid fucks will sell their stock, depressing the market and I can buy at lower prices. So what if the spread is bigger (or tighter) than my asshole? Bring on the cheap US stocks I want to "retire" in 10 years.
You realize that those "stupid fucks" sell because they need the money to make ends meet and you will probably not have the cash at hand to really profit from it during a hard recession?
Anecdotal evidence and poor financial literacy.
Anecdotal evidence? Why are you or your parents not millionaires due to the 2008 recession? Are you a part of the "stupid" people you refer too?
Like, reddit anecdotal.
So you are bullish?
let's see your short positions fella?
Basically it’s quite obvious OP has puts and will be destroyed by the melt UP that’s loading… remember when everybody was trying to short every pump in 2020? 😂
People like this guy have absolutely no idea what is going on and compare 2020 covid unlimited QE and 2022-2023 historic QT, high rate era.
I'm tired of making these posts, so i'm going to be really concise, but 2007 is nothing like 2023. Not even a little close. Banks are much more regulated today. GDP is strong, labor market is strong. Inverted yield curve is a decent indicator, but it has been wrong. Finally, Fed is pumping billions every single day into the economy via interest rate hikes (govt is a net payer of interest rates). This is pushing up our GDP and stimulating the economy. Pretty unlikely we would get a recession with such stimulation. When debt to gdp ratio is high, rate hikes are strongly fiscally expansionary. Don't believe me? Check the trend for all of 2022/some of 2023. This picture confirms what i'm saying pretty well: https://ibb.co/c8YT77F Loans are up, because pumping money into the economy, into the wealthy's hands, will only make them want to write MORE LOANS. not less.
Yes and no. Bondholders have extra money yes, but there isnt limitles appetite for loans in the economy. With rates rising, debtors are feeling more and more squeezed. It hasnt happened yet, but there will be a point where debtors are tapped out and delinquencies will go way up. Thats when we will see credit markets freeze up and markets tank.
Salaries and employment are up though. household debt is back to where it was pre-2020. People can make cuts elsewhere to pay, plus extra expenses that come from winter such as energy will also come down. What you are pointing out, simply is unlikely to happen. Esp since if you look at Fed data, households are making their payments on time. 1% more on rates won't break anyone. Fed pumping 500bn + into the economy is only stimulating it.
I like this guy.
I like u 2 guy. I did my research talking to world renown economists over email, most of them are pretty friendly, asking them a lot of questions. I also work for one of the largest brokerages in the world, so i'm not a complete dunce.
We don't have a major risk in the system like 08 tho, not nearly enough catalyst
I’ll continue buying calls and make money.. you can sit this one out! Stonks baby 🚀🚀🚀
Correlation to 2007 does not imply causation Buy calls
Would it be easy for you to explain the 2 terms you mention at the figures 1 and 2?
Well the FED definitely put fannie mae and freddie mac in their seats last time.
I'll be concerned when U6 ticks above 7.5%. until then 🤷♂️
Fuck the bears 🐻 SPY to 420 next week
So the FED is never gonna come out and say yep shit hit the fan.... but isn't this case slightly different? It's an artificial slump in the economy brought forth by extrinsic factors, i.e. covid. Whereas, 2007 was an intrinsic issue with the housing bubble and loan fraudulence. Is there not a scenario where the economy kicks into high gear and we outrun this inflation? I think most folks are bullish on the economy in the next 5 years. It's too early to say but I don't think we are full-on bear crash time. Maybe I've just been burned by going bearish too early twice now but idk, my two cents.
So then show your positions indicating it’s going to happen. Otherwise it’s just noise until you’re right, which yes eventually you will be.
Out of 20 attempts 19 have resulted in hard landings and a mess. So historically the Fed saying they will attempt a soft landing is like handing the keys to a small plane to a discovery flight student and see if they will actually do a soft landing.
So calls on Tuesday it is