***Official*** 2015 Stock Market Thread

[Hugo Drax]

BBRY still underperforming the S&P 500 and Nasdaq.

 

[sm625]

I went to buy some XLF 23.50 puts ahead of the Fed release, and I noticed that the puts are way outrageously overpriced compared to the calls. When XLF is trading at 23.64 theres no way in hell a 23.50 put should be selling for more than the price of a 23.50 call when they both expire tomorrow. This usually means rally time!

 

[Nograts]

No change to interest rates. S&P up half a po-cento

 

[SketchMaster]

Just watched ADXS drop from 20.83 to 14.18 in a matter of minutes. I had it as a paper trade and wondered if the market just got some bad news on it, but I shrugged it off and went back to work.

It's now back up over 20...

C'est la vie.

 

[Imp]

Well, f*ck that. Zero interest rates forever!!!

 

[Train]

I really don't like keeping rates low forever.

It's going to get to a point where we still have them low when the next bubble pops, then not be able to "stimulate" anything by lowering them further.

 

[JTsyo]

Well that rally didn't last long.

 

[Imp]

That's great... Rates don't go up AND the few stocks I have go down.

Next Fed announcement is late October, apparently. They'll probably make something up by then on why not again.

 

[MustISO]

Well that rally didn't last long.

Yeah, I had a big bounce and then checked back a while later and it was negative. There really was no way to make the market happy with either decision. The media has played the rate increase up quite a bit and so many people/companies try to manipulate the market it's more a game than anything else.

 

[Charmonium]

Rates are definitely going up this year if the infamous dot plot is any indication. Only 4 of 17 members see the rate staying constant through the end of the year.

The following chart compares rate predictions from June (green) to Sept (purple)

So although the board has overall become more dovish, the vast majority see at least one increase this year.

http://www.businessinsider.com/fed-dot-plot-september-2015-2015-9

 

[jpiniero]

I think you should expect 0% now until after the elections. After that, who knows.

 

[s0me0nesmind1]

I think you should expect 0% now until after the elections. After that, who knows.

0% until November 2016

I really wish they raised the rates, either way raise or not it's going to be interesting how the markets react. I'm wondering if we have seen our low point for the year or if that is destined to come when the rate hike comes.

 

[Charmonium]

Markets generally improve for at least a couple of years after a rate hike cycle begins. 2007-8 was an exception. Things were already going to shit by the time the fed raised rates and Greenspan was an idiot. They had to turn around almost immediately since by keeping rates too low for too long they had created the sub-prime loan problem.

Anyway, I don't think you're going to see a violent market reaction. The initial fed move is mostly symbolic. As I mentioned before, 2yr treasury rates have already doubled since last year and this move has been amply telegraphed. The fed has also shown it's dovish bias toward moving as slowly as they can get away with so no one thinks this will herald a set of aggressive rate hikes - the dot plot notwithstanding.

 

[Imp]

Markets generally improve for at least a couple of years after a rate hike cycle begins. 2007-8 was an exception. Things were already going to shit by the time the fed raised rates and Greenspan was an idiot. They had to turn around almost immediately since by keeping rates too low for too long they had created the sub-prime loan problem.

You just described Canada 2015.

Anyway, now if the market goes down, some "analyst" will say it's because the U.S. Fed confirmed the world economy outlook sucks.

Canadian dollar might continue tanking since the recovery was supposedly based on the strong U.S. or international economy. OMFGBBQ, not all great.

 

[sm625]

Things were already going to shit by the time the fed raised rates and Greenspan was an idiot. They had to turn around almost immediately since by keeping rates too low for too long they had created the sub-prime loan problem.

That's not true. The Fed raised rates steadily beginning in mid 2004 and ending in mid 2006. They stopped in 2006 because they surely realized they had popped the housing bubble. But with stocks pushing all time highs in 2007, they could not cut rates until the market threw a fit in mid 2007. But by then it was too late.

 

[s0me0nesmind1]

Seriously? Dow is down 1.10% right now because the fed DIDN'T raise rates? Sounded like a lose-lose heh

 

[KB]

Seriously? Dow is down 1.10% right now because the fed DIDN'T raise rates? Sounded like a lose-lose heh

A lot of people wanted the fed to raise rates, not because they want higher interest rates, but because they wanted certainty. By delaying the rate hike, the Fed has increased uncertainty. Because we still don't know when rates will raise, the market will stay volatile.

I am still accumulating shares. A lot of high yield blue chip companies out there.

 

[JTsyo]

Seriously? Dow is down 1.10% right now because the fed DIDN'T raise rates? Sounded like a lose-lose heh

Down 1% due to international markets being down. The Fed announcement seemed to only have an effect for one hour.

 

[Imp]

CAD is someone down against the USD after starting higher. Stocks closed down.

Markets don't know what to do.

 

[Charmonium]

That's not true. The Fed raised rates steadily beginning in mid 2004 and ending in mid 2006. They stopped in 2006 because they surely realized they had popped the housing bubble. But with stocks pushing all time highs in 2007, they could not cut rates until the market threw a fit in mid 2007. But by then it was too late.

Granted, rates started increasing before 2007. I should have checked that. But my point is still valid. Most ARM's had 3 or 5 year resets. So once the fed started raising rates, there was going to be a delay of several years before you started seeing defaults. So the fact that the fed started hiking in 2004 and you didn't see the rash of defaults until 2007 isn't coincidence.

The problem was that the fed only started raising rates only after it was obvious that they had waited too long. Of course there were other factors as well, but the raising of rates was the death knell for the housing bubble.

 

[Imp]

Something about how the October Fed meeting doesn't have a press conference scheduled. Think that was the original plan, not sure if anything's changed since this past week.

 

[IHateMyJob2004]

BBRY still underperforming the S&P 500 and Nasdaq.

I agree. It's a good time to buy.

 

[us3rnotfound]

I agree. It's a good time to buy.

Lol, who has a Blackberry these days? They're dead to me. And don't go tellin' me about IOT. I know IOT.

 

[FelixDeCat]

Heres the stock market next week:

 

[Charmonium]

Yeah, earnings estimates seem to continue being downgraded and we're almost into the 4th quarter. It's going to be difficult to justify higher share prices in that sort of environment.

I don't think we'll see another 10% correction but you're probably right that volatility will continue unabated.