OPEC is about to fall below 30% global market share for the first time in three decades after recent production cuts. Investing |
- OPEC is about to fall below 30% global market share for the first time in three decades after recent production cuts.
- Headline Nonfarm Payrolls 224,000
- Do investors actually believe a rate cut is coming in july?
- An argument for owning junior gold miners heading into the tail-end of the economic cycle
- In September 2007 the FOMC began cutting rates with stock markets at All Time Highs and the U3 rate at 4.7%, up only 0.3% from the recent low.
- Issues with MSFT
- Where can I get top 10 fund returns by year?
- Randomly generated charts resemble real charts with trends and patterns?
- When do companies “pay the piper”?
- Fed faces tougher task in deciding whether to cut U.S. rates
- Under the efficient market theory, are sector markets significantly less efficient than the total stock market?
- Margin trading vs leveraged ETF
- Earthquakes in California
- Why hasn't Robinhood's fee free trading taken over?
- Stocks
- AutoZone just reached all-time high. Stock is up 67.8% in the past 12 months with revenue up 3% and profits 12% YTD. The company had $5.2 billion in debt with $174 million in cash as of May.
- China's Kangdexin made up ￥12B in profit
- Where can I learn more about OPEC/oil and gas?
- Best books on Swing Trading & Position Trading?
- Dividend Stock vs. Mutual Fund?
- Best App for Portfolio Aggregation
- How Would A War Between the US and Iran Affect the Market?
- Assets riskier than Cash, but less risky than equities
| Posted: 05 Jul 2019 02:22 PM PDT They're cutting further to maintain price stability, but it's causing them to loose market share like crazy to competitors like US shale producers. https://twitter.com/stuartlwallace/status/1145232557841272833?s=21 [link] [comments]  |
| Headline Nonfarm Payrolls 224,000 Posted: 05 Jul 2019 05:31 AM PDT https://www.bls.gov/news.release/empsit.nr0.htm Might be tough to cut with that. [link] [comments]  |
| Do investors actually believe a rate cut is coming in july? Posted: 05 Jul 2019 06:40 PM PDT Implied probability of a rate cut in July is at over 90 percent, according to FT. Luke Bartholomew, investment strategist at Aberdeen Standard Investments, said the latest jobs numbers were "good", but a rate cut from the Fed in July was "inevitable". Do investors really believe a cut is coming in July? When the Fed doesn't cut markets will tank... Unless the Fed really is stupid enough to cut while the economy is doing great. And stocks are at ATHs. Why are we cutting again? https://www.ft.com/content/885767f6-9f1e-11e9-9c06-a4640c9feebb [link] [comments]  |
| An argument for owning junior gold miners heading into the tail-end of the economic cycle Posted: 05 Jul 2019 06:16 PM PDT With 'whatever it takes' becoming the global central bank motto after Powell's conciliatory December speech, most arguments against owning gold have evaporated. "It generates no cash flow" becomes significantly more appealing as real yields on large portions of the global bond market enter negative territory, with the US seemingly trending towards the zero lower bound.
I understand this is a relatively contrarian opinion on here, but the market is not yet pricing in enough cuts into 2021. While the short-end of the curve may whipsaw due to trade developments, it will end decidedly lower without moving higher again this cycle. Let me repeat that: the Federal Reserve will not raise rates or tighten again this cycle. December was both a policy error and proof that a.) rate increases are intolerable given the amount of outstanding debt ex households b.) the world is awash in dollar denominated debt and decreasing overseas liquidity will crush global economic activity.
Let me point out that the equity market seems to be the only thing anyone on this subreddit focuses on, however it's also the least relevant capital market. The bond market is screaming that a policy error has occurred, and the bond market typically ends up being correct. Does that mean stocks have to come plummeting to earth? Hardly. In fact, given rhetoric around the globe it has obviously become a mandate of the global monetary authorities to continue the economic expansion at all costs. The why is more difficult, but my personal opinion is that another global economic recession has been deemed untenable given the worldwide rise of populism since 2008. People are angry about their circumstances, angry about inequality, and although paradoxically a recession tends to decrease inequality, it would also lead to a drastic rise in populism and discontent.
Conventional wisdom is that the central banks are out of ammunition; they aren't. A few things have changed: a.) Central banks are quite blatantly working in concert and coordinating policy responses. b.) Globalization means that barring capital controls interest rates should trend together barring outliers (eg Venezuela). US govt credit is the last risk-free asset with a reasonable yield, and it appears to be the last domino to fall. c.) QE was a paradigm shift. If an authority controls the money supply and is willing to perform OMOs on any asset class, they can without a doubt support prices within that asset class. Could equities be next? Japan has blazed the path in monetary policy and ETF purchases are where they are presently at.
So, do I believe central bankers can prevent a deflationary bust or global economic slowdown akin to 2008? If you had asked me ten years ago I would have referenced 'this time is different' in jest. Today, I'm not so sure. I'm confident that they could prevent a credit crunch and bust in asset prices a la 2008 if policy is coordinated on a global scale. The question now seems to be whether they should. Recessions often entail creative destruction and the loss of jobs whereas Japan has shown that perpetually depressed rates (eg no hurdle rate) can lead to zombie companies and potentially lower growth going forward. There's obviously way more to it than that, but this post is getting long and I haven't even talked about gold miners yet.
Now, why should one own some form of gold? When it's clear that a slowdown is ahead, central banks around the globe are going to go further negative and ease like the status quo depends on it, because it does. Presently almost every leading indicator I follow is showing a slowdown in global economic activity, and while it may not presage a recession, the stark policy pivot we've seen from every major central bank across the globe is what people should be paying attention to.
You might ask, why not own bonds then? Why junior gold miners instead of the physical metal? I'll start with the first. There's a few reasons why bonds seem less appealing than gold on a forward looking basis. I'd argue that the biggest predictor of bond returns on a forward-looking basis is starting yield, but that's largely irrelevant when most simply want a portfolio hedge. Well, I've got good news for you, why do bonds go up in a recession? Because yields go down. So if you presently own Treasuries as a hedge you're essentially betting that yields will approach and potentially go below zero in the event of a slowdown. Well let me tell you, regardless of economic conditions the smart money will flock to gold when there's no longer an opportunity cost to holding it over risk-free assets, and that happens when real interest rates approach zero. If you don't see a use case for a metal that has historically acted as a store of value (over time), compared to a currency that's been around for ~300 years, is engineered to be inflationary and is currently priced to lose money over time, then I'm not sure what to tell you. The only case in which treasuries or sovereigns will make money is a case in which junior gold miners will almost assuredly make more money.
And finally, why junior gold miners instead of gold? Well, it's simple really: gold isn't an asset that produces cash flows so I'm using it largely as a hedge. Instead of holding 40% bonds I'm sitting at around 10% GDXJ and 7.5% other miners that exhibit a sort of optionality in relation to gold price; the miners have low debt & expenses with a cost of production well above the current price of gold, so they act in a sense as an OTM call on gold, have a low cost of carry and lower bankruptcy risk than the index.
Alright, that's the end of the line for me. I've spent too much time writing this and if I add much else it'll become even more convoluted.
Edit: Wanted to add a few more things. Although I find it to be exceedingly unlikely, on the off chance of some inflationary shock gold would significantly outperform bonds, even in a rising rate environment. The big downside risk is that the economy is wonderful and Powell raises rates, in which case hopefully the extra equity exposure as opposed to owning bonds would make up for some of the difference. I also think gold miners are generally a terrible investment and that this is a special situation given the current macro & monetary environment. I do not plan to hold miners and rebalance for years, if my thesis plays out I'll begin paring my position as rates (FFR) approach 0. Don't be surprised to see a short-term reversal going into the July Fed meeting. IMO many headwinds for gold will abate as it becomes more obvious that this slowdown in global leading indicators likely isn't transient or entirely related to the trade war. [link] [comments]  |
| Posted: 05 Jul 2019 10:54 PM PDT People who think the FOMC won't cut at the meeting in 4 weeks have no idea what is happening. With UST's way below the EFF (even the 30Y just about) and USD-Libor joining in (now at ~2.30%), a cut is 100% going to happen. Only mystery is whether its a single or a double (50bps). [link] [comments]  |
| Posted: 05 Jul 2019 09:22 AM PDT What are some problems with Microsoft. I've been looking to buy and I'm trying to find problems with it. What are some downsides to the company, cuz everywhere I read it's almost always positive. [link] [comments]  |
| Where can I get top 10 fund returns by year? Posted: 05 Jul 2019 11:17 AM PDT I can get 2018 top 10 funds(by return) on Kiplinger. However I cannot find where I can find the top 10 funds from 1999, 2006 or any previous year. The reason I want this is for some research. I would prefer a free source however if there are no free sources any source would work. I am looking for something like this but for years other than 2018. https://www.kiplinger.com/tool/investing/T041-S001-top-performing-mutual-funds/index.php [link] [comments]  |
| Randomly generated charts resemble real charts with trends and patterns? Posted: 05 Jul 2019 08:46 PM PDT So some months ago I read the book "A Random Walk Down Wallstreet" and I remember a chapter where the author said something along the lines that flipping a coin and charting its outcomes (heads = price increase, tails = price decrease) would result in a realistic looking stock chart filled with "trends" and "patterns". He was arguing against "technical analysis" (that whole chapter was hilarious btw). So I actually tried this now and his statement was actually pretty accurate. So I wrote some code (see below if interested) that loops a few thousand times and randomly (coin flip) decided if the stock was gonna go up or down. The price moved randomly between 0-99 cents on each loop. So let's say we simulated this for 5000 days. Each day the stock will go up a random value between $0.00 - $0.99 OR down a random value $0.00 - $0.99. Ran this a few times and used Google Sheets to plot the data sets into a chart: https://docs.google.com/spreadsheets/d/1B8Jqysw8ezSOO1K2Ogteqi3bOUAjdEbsqU8fkif18Ds/edit#gid=1166485348 I choose some random values as starting points and if it hit a price close to $0 I restarted it. [link] [comments]  |
| When do companies “pay the piper”? Posted: 05 Jul 2019 11:39 AM PDT Using BYND for example. Assuming they are actually overvalued, when does that come to fruition? Hypothetically if all current investors did not pull their money, wouldn't BYND be valued exactly where they should be? At what point does the though of them being overvalued become actualized and actually effect the company? [link] [comments]  |
| Fed faces tougher task in deciding whether to cut U.S. rates Posted: 05 Jul 2019 09:19 PM PDT On Friday, the Labor Department said nonfarm employers added 224,000 jobs last month - the most in five months, and not the kind of labor market that would normally cause the U.S. central bank to cut interest rates. Continuing jobs gains make Fed policymakers' debate over whether the economy needs stimulus even more difficult, setting up a possible standoff with markets at their July 30-31 meeting. [link] [comments]  |
| Posted: 05 Jul 2019 08:39 AM PDT |
| Margin trading vs leveraged ETF Posted: 05 Jul 2019 10:23 PM PDT Which would be a better choice for long term buy and hold:
The 10-year trailing return of IVV is 14.62%, so option 1 would have yielded me 14.62*2-3.8 = 25.44%, while the 10-year trailing return of SSO is 26.17%, so it seems like the leveraged ETF is a better option (no risk of margin call too). References: [link] [comments]  |
| Posted: 06 Jul 2019 01:53 AM PDT As an outsider it seems like a big earthquake on the West Coast is overdue and I've seen reports in the last few days of the biggest quake for a while (25 years). A lot of tech companies are based in Cali, would any of you take major earthquake risk into account in terms of selling companies HQed in the area? (Not talking about shorting, but selling holdings you have) (Safety first - value of people >>>>>>>>>>>> value of investments) [link] [comments]  |
| Why hasn't Robinhood's fee free trading taken over? Posted: 05 Jul 2019 12:24 PM PDT Are they really just that bad to the point bigger investors would rather take on loss of capital gains in fees just because of the hassle Robinhood puts it's consumer base through? You'd think they'd want to focus on usability and market share. What are your thoughts? [link] [comments]  |
| Posted: 05 Jul 2019 12:37 PM PDT Quick question: is it pointless to have only a few hundred dollars in stocks? I have a few stocks giving great dividends but not on a large scale. I know I can keep buying shares and build it up but just wanted to see others views on this. Thanks! [link] [comments]  |
| Posted: 05 Jul 2019 08:42 PM PDT |
| China's Kangdexin made up ￥12B in profit Posted: 05 Jul 2019 08:13 PM PDT The hi-tech material company made up 1.7B dollars in profit in over 4 years, found to have never made a dime during an investigation. Following China Kangmei Pharma's $4B in cash holdings "accounting error". https://www.bloomberg.com/opinion/articles/2019-07-04/why-i-ve-lost-faith-in-china-s-private-sector [link] [comments]  |
| Where can I learn more about OPEC/oil and gas? Posted: 05 Jul 2019 05:45 PM PDT Hey everyone. Wanting to be more informed on OPEC/oil and gas. Any resources you'd recommend to look at? Thanks! [link] [comments]  |
| Best books on Swing Trading & Position Trading? Posted: 05 Jul 2019 06:33 AM PDT Hey investors, I would like to start trading on a deeper level of understanding and I would love some book recommendations. I would prefer to read books that are extremely proven to be best practice and by reputable authors. I'm currently looking to swing/position trade. I have a full time job and have other projects on the side so I don't have a lot of time so I'd prefer to make some gains by holding a stock for a period of time (1 week to months at a time). I will likely be starting with a couple of thousand until I solidify my strategy. I will also be using Robinhood. A couple of questions for you guys: Anybody working a full time job but make some decent side money doing swing trading? How much time do you typically spend in a week? How much money do you guys invest with? Thanks for the help!! [link] [comments]  |
| Dividend Stock vs. Mutual Fund? Posted: 05 Jul 2019 11:46 AM PDT Looking to begin dollar cost averaging a dividend paying security. Looking at either a high div. yield stock like Enbridge, or a mutual fund in which I haven't done any research into yet. As a 21 year old student with other investments, risk is not an issue. I have decided to periodically put money into an investment to get my 10% fund going early. I've had my eye on Enbridge for a while now cause they're a solid company and have a div yield of 6.19 with the potential to make some gains, but a mutual fund has diversity on its side and also has higher fees I believe. Thoughts? I work at RBC and have a few mutual fund friends who can advise me in that section. Just looking for a compare and contrast of my options. Thanks! [link] [comments]  |
| Best App for Portfolio Aggregation Posted: 05 Jul 2019 10:22 AM PDT Does anyone have a recommendation for a free(ish) app that aggregates multiple portfolios? I have a 401k and stock accounts with multiple companies? Also curious to see if anyone has seen something that shows how much percentage your portfolio has of a certain stock taking into individual holdings and mutual/ETFs. For example, if someone holds AMZN and QQQ, how much $$ they actually have in AMZN. *over mobile please excuse formatting [link] [comments]  |
| How Would A War Between the US and Iran Affect the Market? Posted: 06 Jul 2019 02:02 AM PDT As conflicts escalate in the Middle East, How would it affect the market? I don't think it would kickoff the 'big impending recession' that is gonna happen as the market seems likely to climb for now. Would a war with Iran dramatically affect the market or do investors not care. I've never been in the market when a war has broken out so I have zero idea what to expect. [link] [comments]  |
| Assets riskier than Cash, but less risky than equities Posted: 05 Jul 2019 06:26 PM PDT Late 20's here. Retirement accounts: I invest in low cost index funds thru Vanguard and Fidelity. I max my Roth IRA and my employer generously contributes 7% to my 401k (I also contribute an additional 13%). Taxable account: Every Monday, I contribute anywhere from $50 to $400 to my taxable account (27 stock picks). I also have Cash sitting in Vanguard's federal money market VMFXX (settlement fund) which yields around 2.3%. My questions: For my Taxable account, having done some research on actual T-bills, CD's and short duration bond funds like SHV, SHY, BIL, VCSH, GSY, NEAR, etc, what are some other Bond ETFs or other alternative assets/ideas that you invest in that's riskier than Cash but not as risky as equities? Time horizon: 10 years Intention: Curious as to what others hold in their portfolios. I'm trying to yield more than 2.3% but not take on the type of risk that's associated with equities. [link] [comments]  |
| You are subscribed to email updates from Lose money with friends!. To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
| Google, 1600 Amphitheatre Parkway, Mountain View, CA 94043, United States | |
No comments:
Post a Comment