***Official*** 2016 Stock Market Thread

[Red Squirrel]

Things might be looking good for Bombardier! Went up by a few pennies in the past few days. Looks like they actually did deliver on lot of their passenger jets.

I wanted to buy Rare Earth Mineral (REM:LN) stock today but seems you can't buy those through Virtual Broker as they only deal with North America. How does it typically work in cases like that, do alternate markets have mirror stocks or something? Or are you pretty much constrained to buying within your general location/continent or whatever your broker supports? I think that one may possibly go up in the future once Tesla really ramps up production of their batteries but it's just an uneducated guess. Basically they are sitting on a pretty big lithium reserve. I already have some Baconara Mineral ones for same reason. Almost debating on buying more given how cheap they are. As a noob, I'm buying with a very uneducated assumption they may go up though. It's a gamble.

Wonder if I should look into solar related stocks too, prices of solar modules have been coming down, hydro prices keep going up. People and companies may start to buy more into it in the next decade or so. With VB you have to buy 100 at a time, I imagine that's the price you pay for the low commission fees, so typically can only afford the cheaper stocks. The thing with those is you can make it HUGE if you get lucky. Microsoft, Apple, etc were all there at one point.

 

[Charmonium]

Not sure where you are but in the US, stock of foreign corps are traded as separate securities called ADRs - American Depository Receipts. The ADR of say Nestle will trade in sympathy with the foreign stock. Not sure how this works in foreign markets but would imagine you have similar securities. Unfortunately, the demand probably isn't as great so probably don't have as many companies issuing ADRs or equivalent.

 

[ImpulsE69]

Bought some GLD today. Gold is down to close to pre-Brexit level. I think it can go back down to $1,270 level as the trend and sentiment is pretty negative right now. I thought about buying NUGT but I hate 3x ETF and I don't know the tax structure of NUGT. I also think miners are more vulnerable than gold even though many have corrected 40-50%. But that was after 200-400% rise from the low.

I also sold some Twitter trading shares I bought at $15 and used the profit to buy some British Queen's Beast gold coins.

Be glad you didn't. I bought NUGT right before the rather drastic drop on a dip that only kept dipping. It is insane that everything is like it is, but I expect that after the elections it will recover some. Until then I just keep sniping DUST/JDST and grabbing some JNUG on the upswing. What is wild is watching both the dollar and gold go down at the same time.

I also bought into BMY after the downfall because most analysts thought the market was overly harsh, but it continues to fall. I do think longterm they will recover some, but wow, it's like everything I touch turns to shite.

 

[Imp]

WTI down hard again today... Almost time to get into those triple-leveraged long oil ETFs!!!

"Rumors" of an OPEC supply freeze or meeting should be hitting Twitter for those HFTs to read up within a few days!


Edit: And some cargo shipper, Hanjin, went bankrupt. I don't have a good grasp of the situation and don't fully understand its significance.

 

[dullard]

Edit: And some cargo shipper, Hanjin, went bankrupt. I don't have a good grasp of the situation and don't fully understand its significance.

Hanjin was one of the world's largest shipping companies. Basically the great recession a few years back drastically lowered world trade. World trade still hasn't really recovered (it briefly recovered and then fell again). Europe and the developing economies are in shambles. They just aren't trading much.

At the same time, Hanjin and its competitors all went heavily into building massive ships. It made sense at the time, world trade was booming up until the recession, ports were expanding, and the panama canal was expanding. In the world-shipping business, the way to get a leg up is to build a bigger boat since your costs plunge with a bigger boat.

However, they didn't realize that debt-based recessions take decades to recover rather than months like most other recessions. So you ended up with every shipping company with much expanded capacity and demand that never came back. That is a recipe for bankruptcies all around.

Overall, probably not a major disruption. But there will be some immediate disturbances since the boats can't dock otherwise they are being confiscated. That means whatever is on them can't be delivered.

 

[Charmonium]

Thanks. That was interesting. The lead time on ship building has to be years. I can't even imagine how you plan for that kind of lag.

I wonder what affect this will have on ship builders that have contracts with them.

 

[FelixDeCat]

WTI down hard again today... Almost time to get into those triple-leveraged long oil ETFs!!!

"Rumors" of an OPEC supply freeze or meeting should be hitting Twitter for those HFTs to read up within a few days!


Edit: And some cargo shipper, Hanjin, went bankrupt. I don't have a good grasp of the situation and don't fully understand its significance.

Right on the money. They got Putin to say something and all he said was something like "I like production cuts" for the phoney "meeting" in late September. Result? Crude futures up 1%.

Bunch of bullshit.

Im now short a call spread expiring 9/16/16.

 

[jpiniero]

The jobs report was mediocre. Time to buy!!

 

[Imp]

US job numbers... Briefly glanced at it, think it hit 151k in August. I assumed they sucked since markets went up. Mediocre works too. Bad news = more stimulus/QE, so of course the market would go up.

My guess is one Fed hike in December just to save face. Otherwise, they'll look stupider than they do now -- but but but 4 hikes this year...

Delinquencies took a break for some reason. Same thing appeared to happen in Canada. On the other hand, they took a break in Q3 2008 too. Q2 is up on St. Louis Fed site:

https://fred.stlouisfed.org/series/DALLCIACBEP

 

[Charmonium]

That's an interesting chart, especially if you edit it to see it in terms of percentage change. The only thing I can guess is that the delinquencies are evenly distributed over various sectors and that's why there isn't more press coverage of it. Still, it would seem to be a negative sign.

Although you could also look at this as being the turning point I suppose. Delinquencies I would think are a lagging indicator. Things have already gone to shit by the time you're so bad off that you can pay your debts.

 

[Mai72]

I don't get stocks. You need to put enough in to see any type of return. I have a friend whose invested in multi-family apartments. When he got into the market he saw immediate returns on his money. I'm talking 12% the first year. And it has only gone up after that. Plus, real estate is tangible. You can touch it. Walk on the property.

I guess everything has its pluses/minuses.

 

[Imp]

That's an interesting chart, especially if you edit it to see it in terms of percentage change.

Indeed... If we're repeating history, are we at Q2-Q3 2008 or Q1-Q2 2009 using yoy percentage change?

Consumer/residential loans don't seem to be moving up, this chart's just commercial/industrial.

 

[larciel]

I don't get stocks. You need to put enough in to see any type of return. I have a friend whose invested in multi-family apartments. When he got into the market he saw immediate returns on his money. I'm talking 12% the first year. And it has only gone up after that. Plus, real estate is tangible. You can touch it. Walk on the property.

I guess everything has its pluses/minuses.

real estate is savings acct.

stock market is Vegas.

 

[brianmanahan]

I don't get stocks. You need to put enough in to see any type of return.

the return is directly proportional to the investment amount

and someone can't exactly buy 50$ of a multi-family house per week

 

[Charmonium]

I don't get stocks. You need to put enough in to see any type of return. I have a friend whose invested in multi-family apartments. When he got into the market he saw immediate returns on his money. I'm talking 12% the first year. And it has only gone up after that. Plus, real estate is tangible. You can touch it. Walk on the property.

I guess everything has its pluses/minuses.

Real estate tends to do well in a low interest rate environment because debt service is one of your main expenses and with low rates you keep that to a minimum. Plus you had a lot of pent up demand from after the recession. Take a look at this chart.

http://www.frbsf.org/economic-resea...6/may/household-formation-among-young-adults/

Household formation took a nosedive during the recession with people moving back home, parents moving in with children, etc. Now, you can see that trend is rising.

As long as rates stay low, you'll probably do ok in a well rated REIT. I know that the NYC Bloomberg radio station is constantly advertising National Realty as giving a 12% return on investment for, I think, the past 10 years. But return is ALWAYS directly proportional to risk. So if you're getting 12% now, the odds are pretty good that you're going to end up paying for that somewhere down the road. Probably when rates go up - which could be pretty far down the road.

Indeed... If we're repeating history, are we at Q2-Q3 2008 or Q1-Q2 2009 using yoy percentage change?

Consumer/residential loans don't seem to be moving up, this chart's just commercial/industrial.

I think that the consumer has yet to speak and that we have yet to see a true economic recovery. Until you see another real boom in housing, I don't think we're there yet. And I don't mean a run up in prices, I mean an actual construction boom - something we really haven't seen. Last I checked we're only about half of the way to the pre-recession highs.

 

[Imp]

But are banks still holding onto a sea of foreclosures from the previous bubble? With so much time passed, the abandoned ones are probably dilapidated and need to be torn down like they're actually doing in Detroit...

It's the low rates. People don't care how much their condo/house is worth when they're buying it, they only look at the monthly payment. Comparing monthly payments using current rates to "regular" rates closer to 5% prime, you get a pretty good idea why/how prices get inflated so much.

 

[Charmonium]

I'm guessing that would be 'Vacant Housing Units Held off Market'

And yes, it looks like that number has been hovering around 7.4M units for the past 4 years. But as you say, anything that's been vacant that long, there's a good chance it's going to be beyond repair. And definitely if it's been vacant since the recession.

But that just reinforces the need for new construction I would think. As far as the banks taking losses on those properties, I'm sure that loan loss provisions were made long, long ago.

 

[turtile]

But are banks still holding onto a sea of foreclosures from the previous bubble? With so much time passed, the abandoned ones are probably dilapidated and need to be torn down like they're actually doing in Detroit...

It's the low rates. People don't care how much their condo/house is worth when they're buying it, they only look at the monthly payment. Comparing monthly payments using current rates to "regular" rates closer to 5% prime, you get a pretty good idea why/how prices get inflated so much.

People don't buy houses by the cost of the house but if they are able to afford the monthly payment. As you raise the interest rate people need to make more money or the value of housing shrinks. I can't tell you how many people I met or know who buy a house at the top of the budget range. They don't take in all of the other costs that deal with owning a home (basically, all of there extra income goes into the house and/or they get a second job).

Where I live, you can't get rid of old houses since there are so many new houses on the market. Yet none want to part with their used house at what the market will bare.

 

[Imp]

This is talking about the bubble in Australia, which I think is the biggest in the world right now. Debt-income ratio is even higher than Canada's 1.65, IIRC. Every housing bubble discussion I read, it seems like someone chimes in with "someone doesn't get economics 101" or you need to increase supply because economics, yo -- not here, mainly comments sections and other popular discussion sites.

"The problem is you can't apply year 10 economic theory to a metropolitan housing market."

The housing market doesn't behave like the market for bananas or cans of beans, experts say.

...

"Homes are unaffordable not because we are building too few but because the market is flooded with cheap credit," he said.

Might be video:
http://www.smh.com.au/business/the-...chart-suggests-it-doesnt-20160902-gr7sbz.html

 

[FelixDeCat]

Now the next "play" will be pump oil into the meeting in late September (which will result in nothing), then bring it back down after no cooperation. Bunch of garbage.

 

[FelixDeCat]

the return is directly proportional to the investment amount

and someone can't exactly buy 50$ of a multi-family house per week

Every time you make a payment, some goes to principal, some goes to interest. You are buying your home. Also, its $50, not 50$.

Also, look up housing REITS, which can be purchased $50 at a time if you are so inclined, but at $10 per trade its kind of stupid.

 

[Imp]

Now the next "play" will be pump oil into the meeting in late September (which will result in nothing), then bring it back down after no cooperation. Bunch of garbage.

Meh, no need to "play."

"Shitty" job numbers means market lowers probabilities for the next hike in September. DXY goes down, commodities up, and maybe Fed will even do more QE or do NIRP, so markets go up.

Fantasy land is where we live. Markets up on "bad" news, down on "good" news. All is well until everyone lends out of money to borrow or jobs to pay loans.

If we're lucky, Fed will hike once after election so they can say they aren't incompetent/liars. Then markets crash in January after Christmas break... like last year.

 

[FelixDeCat]

LOL!! Saudis and Russians "agree" to work together to raise oil prices.

So predictable (the pump before the late September dump).

 

[turtile]

LOL!! Saudis and Russians "agree" to work together to raise oil prices.

So predictable (the pump before the late September dump).

But nothing guaranteed....

 

[FelixDeCat]

But nothing guaranteed....

Which is why its foolish to go against the flow. Just play the game.

I bought some Whiting Petroleum (WLL). Credit Suisse says its worth $12. I bought at $7.80.