Anyone here follow the stock market ?

We are breaking through some important technical levels.
What concerns me is china, its the second largest economy in the world. The fact that they are slowing and the chinese are making futile attempts at pumping money into their financial system to hold up their market to no avail, is troubling. Also, you cant believe a word the chinese say, we may never really know just how weak their economy is really getting.
Europe is stagnat, now china. Although the US economy is ok ( for now) its only a matter of time before US companies start feeling the effects of a global slow down.
My biggest concern: the fed has no bullets, rates are already near zero. If we take some sort of economic hit, there are no more weapons the fed can use. Had the fed raised rates a year earlier, we might have a cushion. I am sitting on my hands and if we get another big drop, i will start putting some money to work ( a little at a time on big down days) just to buy some S&P funds.

I'm in the camp of those that believe that if the Fed doesn't do another round of QE, the economy will go right into a recession. The weak recovery will end in collapse. Regardless of what happens in China. I don't support QE but short term everything collapses without it.

I do I keep warning my kids an ex kids . But they are too stupid to listen especially the ones in Germany.

I follow everything I check food prices. I don't have to do that, but I am used to doing that.

I think the euro will crash. It would have crashed already but it is being propped up by the dollar. So it is just a matter of time.

20-30% bear market coming. The forward earnings are terrible, the only thing that kept this market going was trillions from the fed/zero interest rate and a robust china. We have neither and the fed is now out of ammo in this fight. Major deleveraging ahead.

My portfolio is 100% cash. I will back up the truck after the crash. Going to leave the 401k alone, have 30+ years to retire.

Im doing the same thing ; all cash. The global slow down will hitbthe US and
P/E multiples will have to come down.
Im lookmimg at the s&p going to 1800, maybe lower. Right now im just scalping by making a point here and a point there.

Nope..

I used to follow the market, and heard for years about a big crash because of defict spending, remember the market was at 3,000 when Reagan was in office


nothing is going to happen, all the doomsayers always eat crow!!

it may go down but, it will always come back up, the entire world depends on us.

Of course the market will come back, it always does. However, it would be kimd of stupid to keep your money in stocks when the global economy is weakening and interest rates are going to rise.
Why not stay in cash and gradually put your money to work after large sell offs..
If the dow drops another 1000 points over a few days, buy some index funds.

well said belmont

That's actually bad advice he gave Binnie. Just because the market drops 1000 points doesn't mean it's ready to go back up soon. The old saying goes "The market can stay irrational longer than I can remain solvent". That means you can buy on a down dip and think you are about to make a killing, and then end up sitting on dead money moving sideways for another 4 years.

I encourage everyone to read the old time classic, the Great Grandfather of all technical analysis books, "Technical Analysis of Stock Trends", first written in 1948. That book is considered a professional college grade text book and is the key to understanding a great deal else if you use it as a masterkey.

PS: The book is a few inches thick. So don't bother with this if you don't enjoy reading.

That is true Alfa Romeo, but the stock market always fluctuates. Even if your money is going sideways, in six years to 10 years time you will make a return in profits, but that is if you have patience. It all depends on what kind of stocks you put your money in.

Alpha
If you buy a little on big dips you will make out well in the long run. Its impossible to know when you hit bottom my friend, it aint gonna happen.
Buy on big dips when everyone else is afraid.
How many investors bought the bottom in 2009??? Only liars.
You can buy index funds every 700 point drop in the dow or 75 point drop in the s&p .

In six to 10 years time you will make a return in profits if the companies you invested in rebound with the broader market. And the internal fundamentals of that company is going to determine how much it rebounds (beta).

Buying the Dow or an Index fund on dips is one thing. Picking individual stocks out and them buying them on dips or corrections is quite another. The thing about the Dow is that it won't give you outsized returns. The beautiful part about the Dow is that it will keep rising. Dow? Yes. Index funds? Meh. Beware of fees. Mutual funds? No. Most mutual funds do not beat the Dow from what I understand.

All of that said, "dips" are not a proper price signal.

How do you know a bear market is about to hit? The stock market forecasts recessions. I don't think that's happened yet. And the new trade deal that everyone was distrustful of is moving forward, the TPP (or Trans Pacific Partnership). That might boost corporate profits and the stock market with it, whether or not it causes a net loss or gain in domestic employment.

Most of what goes on in the stock markets these days has to do with what the markets expect the federal reserve to do. The fed was acting as if rate hikes were coming and There will be no More QE due to a supposed recovery. That alone was enough to shake things up and make the markets go down. I highly doubt the Fed will actually hike rates meanwhile the market crashes.. I expect them to return to more QE and low interest rates. Flooding the market with easy money may very well prop things up all over again..but how long that will continue to work, there's really no way of knowing.

SoCal, I wouldn't read that much into QE when doing due dilligence on a stock and the stock exchanges. The reason why is because even before most people even heard of QE, US Corporations were already sitting on top of a mountain of 2 Trillon dollars in cold hard cash. Not equity, or capital gains. Cash. They simply refused to invest it for expansion.

I was hearing that before too. Its been a while since I looked into it but I remember reading how a huge chunk of that cash was mainly from the biggest companies like Google, Apple, Microsoft and more I can't remember right now. Some of the money was cash borrowed due to low interest rates. A lot of it was deposited in banks which meant it was being loaned out and invested somewhere else.
Either way, I wouldn't pretend to know how QE factors into any specific stock.
Just more generally QE tends to bid up stocks for a variety of reasons.

Very low ( historically low rates) force investors and fund managers into stocks opposed to other assets. Those searching for yield were only going to find it in stocks. That is what really propelled this market. Get 3 1/2% in a checking account and watch what happens to the stock market.
Another thing to look at are long term bonds. If short term rates go up and long term rates start falling, thats a very ominous sign ( inverted yield curve).
No matter how bad we think things will get, you will always make money buying stocks when everyone is in panic mode. Same with real estate.

To make sure your company's stock is rising due to rising profits and not just cash reserves, I would check the cash flow statement. QE might show up there if the Fed is buying securities from corporations. If the QE is just the Fed buying bad mortgage bonds from the banks to give them liquidity so that they can begin lending again, again it's redundant. The corporations still have that mountain of cash they're sitting on. Or maybe it's like you say....only certain corporations are cash rich, the others are just going along. But if the companies that are hoarding cash are the titans that make up the Dow Jones Index, then QE can't bypass them to jumpstart economic activity. Everything either begins with or passes through the Dow Jones 30 (or whatever the number is today that make up that index).

No one really has to buy a stock. What happens is money becomes cheaper to rent, and when corporations begin doing so, stock valuations begin to rise because growth is portended by analysts. That rising valuation causes specialists to raise the bid and the ask, Before you know it, "the market" is forcing stocks up due to the power of supply and demand for a security. But it didn't begin with supply and demand (for a stock).

If there is a "pressure" to move into stocks and out of government securities due to falling interest rates, it is because a manager of millions or billions of dollars cannot justify to his employers and investors his investing their money into securities with low and lower interest rates. So his job security relies on him moving into a higher yield vehicle.

All of that said, I think we agree on your post. I just love breaking it down.

I think the inverted yield curve might be a sell signal because if long term corporate bond yields are going down, that means the face value is up, which means the big money is buying corporate bonds and foreseeing a market correction in the longer term.

Wait, i didnt mean they are forced to buy, what i meant was fund managers looking for a good return were only going to get it in stocks due to rates being so low. Seriously, where else were fund managers going to make money for clients ???

Of course they're not forced to buy. But if they don't, out they go. I think we agree Belmont.