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Started By
Message
re: Is October when the bottom falls out of the market?
Posted on 9/30/22 at 6:17 am to Thundercles
Posted on 9/30/22 at 6:17 am to Thundercles
The big flush hasn’t happened yet, and it will, so maybe. Whipsawing it on the way down to suck up buy orders, break trailing stops, minimize options damage and control the panic. This has got a 2008 or worse feel to it and with global macro rightfully so, gonna get nasty methinks and people’s resolve will be tested in more ways than one.
1
Posted on 9/30/22 at 6:37 am to LSUtoOmaha
quote:
The market does not care about news that has already been announced, and almost always comes out of a bear market when news is still terrible.
True but I don’t think we are anywhere near the news not being terrible. In the past the fed could just increase QE and drop rates. The government could just dump a huge stimulus package. I don’t see that happening. When the Republicans are thrown back in office I foresee a stalemate of sorts.
Posted on 9/30/22 at 8:32 am to Thundercles
Just like 2008 it’ll be a great buying opportunity. Already is really.
Posted on 9/30/22 at 10:35 pm to TejasHorn
quote:
Just like 2008 it’ll be a great buying opportunity
Many with cash on the side are salivating over the coming dip. Just like March 2020. Like a kid in a candy store. Cash is king.
Posted on 10/1/22 at 2:15 am to TejasHorn
quote:
Already is really.
I'm iffy on this. I see this decline picking up steam before it it levels off. I think buying now isn't the worst thing ever, but I think holding out until Q1 is the best bet.
Posted on 10/1/22 at 8:22 am to Thundercles
The interest rate gonna be 15% next year but a loaf of bread is gonna be 10 bucks
The only way for us to survive this is to have Russia nuke us and start over
The only way for us to survive this is to have Russia nuke us and start over
Posted on 10/1/22 at 11:16 am to DTRooster
I don't have confidence in bulls turning it around with the lack of liquidity. I have more confidence in bears getting too aggressive at bad prices turning us around, but I don't know if we're there yet, they are quieter this time around. It seems there's enough liquidity for counterpunching overconfidence on both sides, but that's about it.
Posted on 10/1/22 at 11:59 am to JLivermore
There will be bounces, but the trend will definitely be downward for at least the rest of the year.
Earnings reports will start coming out next week, many will likely be lower than consensus. Q3 GDP will be down, that report will drive the market lower. Durable goods will likely be down, driving the market lower.
CPI will be... tricky. It's going to be tough for YoY CPI to go up as we get into comparing this year to last year's rapid increase (if that increases, we're truly in shitsville), so the real focus (for the time being) will be on MoM.
Energy is still high (electricity & natural gas) and food has continued to spike. While oil and gas have dropped quite a bit, I don't know if it's enough to offset the other growth. If it comes down to housing prices, I think CPI could be slightly up (due to home prices actually being based on rent equivalence and rents are going up). If MoM is flat or negative, the market will respond very favorably. If it's positive (which I think is likely) then the market moves downward (the higher the increase, the deeper the drop).
Strangely, if Unemployment rises it may be a positive for the market (I think sharply rising unemployment is one of the signals the Fed is looking for to pause rate hikes).
If the Fed pauses (from the emergency meeting on Monday), the bulls will run for a bit, but it's going to be just another bounce which will be derailed once Q3 numbers start coming in.
Get your SQQQ ready.
Earnings reports will start coming out next week, many will likely be lower than consensus. Q3 GDP will be down, that report will drive the market lower. Durable goods will likely be down, driving the market lower.
CPI will be... tricky. It's going to be tough for YoY CPI to go up as we get into comparing this year to last year's rapid increase (if that increases, we're truly in shitsville), so the real focus (for the time being) will be on MoM.
Energy is still high (electricity & natural gas) and food has continued to spike. While oil and gas have dropped quite a bit, I don't know if it's enough to offset the other growth. If it comes down to housing prices, I think CPI could be slightly up (due to home prices actually being based on rent equivalence and rents are going up). If MoM is flat or negative, the market will respond very favorably. If it's positive (which I think is likely) then the market moves downward (the higher the increase, the deeper the drop).
Strangely, if Unemployment rises it may be a positive for the market (I think sharply rising unemployment is one of the signals the Fed is looking for to pause rate hikes).
If the Fed pauses (from the emergency meeting on Monday), the bulls will run for a bit, but it's going to be just another bounce which will be derailed once Q3 numbers start coming in.
Get your SQQQ ready.
Posted on 10/1/22 at 12:06 pm to Bard
Stocks still aren't that cheap. I think the S&P multiple is in the low 18's right now. I think that's going to come down to 15-16x at least, possibly lower.
This post was edited on 10/1/22 at 12:07 pm
Posted on 10/1/22 at 12:19 pm to Bard
I read this morning that spending still won't stop and inflation is still going up because there's still a glut of money. The Fed's only option is to keep increasing rates until the government and people stop spending money nonstop.
LINK
quote:
Other states – and cities– too are flush with money, and they’re spending it in a million different ways either directly or by subsidizing one thing or another. And Congress just passed massive give-away legislation that douses corporations and consumers in all kinds of incentives, cash, rebates, and what not.
And this kind of stuff just keeps on keeping on – because states and cities are flush with pandemic cash, and cash from tax revenues, and they’re going to throw this money at their businesses and consumers. And Congress is still living in an era where money was free, and it acts like it.
quote:
Total consumer spending on goods and services, adjusted for inflation – so “real” consumer spending – ticked up by 0.1% in August from July, and by 1.8% from a year ago, to another record, despite raging inflation.
This was driven by increased spending on services (adjusted for inflation), even as spending on goods (adjusted for inflation) continued to dip from the huge mega-stimulus surge last year. Clearly, the Fed’s message about wanting to slow demand hasn’t gotten through to consumers just yet
LINK
Posted on 10/1/22 at 2:17 pm to Thundercles
I would love to see unit sales in comparison to adjusted sales dollars. With the inflation and shrinkflation we've seen I have to wonder if that isn't skewing sales upward as people are spending more but getting less (this is truer with soft goods, but the principle is the same).
Posted on 10/2/22 at 7:46 pm to Thundercles
If Core CPI m/m comes in weak enough to allow .5 from the Fed Nov. 2nd, then risk-on will explode (markets way up/dollar way down). If Core CPI m/m is high enough to force a .75 from the fed, things could get extremely bad.
Every financial thing on earth comes down to 2 things this month which will decide heaven or hell:
1. Core CPI m/m due out middle of the month
2. Nuclear war
Every financial thing on earth comes down to 2 things this month which will decide heaven or hell:
1. Core CPI m/m due out middle of the month
2. Nuclear war
Posted on 10/2/22 at 8:36 pm to BarleyPop
quote:
If Core CPI m/m comes in weak enough to allow .5 from the Fed Nov. 2nd, then risk-on will explode (markets way up/dollar way down).
I disagree.
CPI is going to be surrounded by bad news. Q3 earnings being down, GDP being down (again... maybe this time they'll actually call it "a recession"), Unemployment going up (again), Durable Goods being down (again), etc. If MoM CPI is flat, we could see a market bounce but that's about it. If it's up, even another .1, the market takes it hard because that is just one more point to push the Fed to an increase of at least .5.
Posted on 10/2/22 at 9:41 pm to Bard
quote:
I disagree.
CPI is going to be surrounded by bad news. Q3 earnings being down, GDP being down (again... maybe this time they'll actually call it "a recession"), Unemployment going up (again), Durable Goods being down (again), etc. If MoM CPI is flat, we could see a market bounce but that's about it. If it's up, even another .1, the market takes it hard because that is just one more point to push the Fed to an increase of at least .5.
I'm torn between being polite vs being direct. If this were a face to face conversation I would smile and nod and let you say your opinions and then change the subject to something you knew more about or something I knew less about. But, given the anonymous message board format, i will just tell you bluntly:
Core m/m CPI. None of that other crap matters in the least. Not one tiny bit. If it comes in at .3 or less, there will be a huge relief rally. This is not an opinion that requires debate. It is a fact.
If we get .3 (probably even .4) or less and no nukes, the Dow will be up 1000s of points from its current position.
*another concern is Credit Suisse, but I don't believe they are collapsing between now and then.
Get that acceptable m/m core in 2 weeks, followed by fed .5 in Nov and Dec, followed by .25 in '23 then pause, and everything's good with the world. Until $120 oil hits again. And it will without another SPR release.
Posted on 10/2/22 at 11:23 pm to BarleyPop
After looking at the m/m core chart, I'd say .4 would be a terrible outcome and would likely be received poorly by markets. So .3 or less gets the rally with .2 or less being fantastic as that would put in a "lower low" on that particular chart's wave.
Posted on 10/3/22 at 1:11 am to Bard
quote:
Bard
I'm more in your point of view. I think the Fed has fully realized how much they fricked up by not raising rates faster sooner. Jerome Powell has plainly stated they will continue to raise rates until people start losing jobs en masse. Even slightly less inflation doesn't put us any close to their actual goal yet. Slowing down would just encourage the markets, which is exactly what he doesn't want.
Along with Terrible Q3 earnings and GDP being released. I put no faith in the job numbers as the administration is fabricating them to hide the true depth of the looming disaster
Posted on 10/4/22 at 8:59 am to Thundercles
If this is the bottom falling out i'm all for it 
Posted on 10/4/22 at 9:06 am to Thundercles
No. The fed will smoke and mirror the hell out of this until after the holidays I think.
Posted on 10/4/22 at 9:13 am to FLObserver
This is what the market has become. Weak data causes a rally.
Amazing.
Amazing.
quote:
On Monday, Wall Street soared to its best day in months in a widespread relief rally after some unexpectedly weak data on the economy raised the possibility that the Federal Reserve won't have to be so aggressive about hiking interest rates.
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