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 The Simple Facts On Equities And Debt
Robodog 474 posts, incept 2011-06-12
2022-09-16 11:13:29

Well, with interest rates waxing, at least savers have an annual small opportunity to benefit by buying up to $ 15K ($ 10K + up to another $ 5K, via their U.S. tax refund) of relatively risk-free (notwithstanding capital risk) I-bond (not crApple) 30-year government debt, which is nice, albeit not nearly enough to whip inflation now.

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Defiance to tyrants is obedience to God. ~Ben Franklin
Just like heaven The Cure
As free as the wind Roxy Music
On the silent wings of freedom Yes
Chemman 260 posts, incept 2021-05-03
2022-09-16 11:13:38

@Blanca

LOL; I was stationed in Japan with the AF 1971 - 1974. During that time frame President Nixon took us off the Gold Standard and the Yen went from 360 per dollar to about 270 per dollar.
Rokwell 66 posts, incept 2008-10-23
2022-09-16 11:13:44

Smacktle,

Invested? No, not in this environment. I just had a conversation with a friend last night and this topic came up. He said he had pulled 90% of his cash out of the market earlier this year because he was afraid of a crash. I suggested that money can be made even when the market declines, but not everyone is interested in trading. I dabble in options, nothing serious and nothing that will make or break me. Put spreads have been entertaining as of late.
Phillydog 80 posts, incept 2021-09-13
2022-09-16 11:42:08

So where do you hide, if bomd rates keep rising and stocks keep dropping and our dollars come home and inflation is hot as hell...

Everybody takes a haircut i guess?
Tickerguy 188k posts, incept 2007-06-26
2022-09-16 11:43:22

You don't @Phillydog, and attempting to do so in anything that has leverage exposure costs you more.

Stocks are ALWAYS levered because (1) they're at the BOTTOM of the capital structure, and thus NEVER protected against loss, including 100% loss, and (2) because debt IS protected against loss AND falling coverage costs goose EPS there's an IMPLIED leverage in common stock that almost-nobody understands but boy, they all love it on the way up.

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NASA faked out a computer instead of running the test.
Then tried to launch and aborted instead of going "BOOOM!"
Did they abort the JABS after faking THOSE tests?
Veeger 669 posts, incept 2013-02-13
2022-09-16 11:49:42

I went cash this summer. Liquidated some energy stock which I've always felt was a good bet. Was feeling a bit like it had been a mistake, but even the 'good stuff' drops precipitously when a crash occurs. I'll stay in cash until 'After'

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I remember the Diamond Princess.


Slowly at first, then all of a sudden.
Tickerguy 188k posts, incept 2007-06-26
2022-09-16 11:50:21

You can sniff around and buy here and there, but if you've got material exposure here, and especially if you're adding exposure trying to "average down" you're taking a terrible risk.

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NASA faked out a computer instead of running the test.
Then tried to launch and aborted instead of going "BOOOM!"
Did they abort the JABS after faking THOSE tests?
Bluebird 2k posts, incept 2008-05-02
2022-09-16 11:58:40

Here's an old ticker that has some useful information

4/18/08 When Men Had Balls That Clanked
https://market-ticker.org/akcs-www?post=....

Tdurden 1k posts, incept 2015-01-29
2022-09-16 12:00:50

I had the "pleasure" of talking to a few people calling themselves financial planner/advisors around 2006/2007. None of them would give me a straight answer to one question: "Under what circumstances would you move me into all cash"? After a 10% drop? 30%? 70 %?! We both knew the answer....they would ride my account and everyone elses' down to zero if it came to that.

I'll never forget the pace I was working at early 2007 brought in a clown from merrill lynch to calm the sheep in their 401k after Countrywide had been cut in half. That clown BRAGGED that they were buying MORE Countrywide because it was on sale! At that point I knew I had made the right decision by not getting into that company's 401k.

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"I'd like to live just long enough to be there when they cut off your head and stick it on a pike as a warning to the next 10 generations that some favors come with too high of a price." -Vir Cotto Ba
Veeger 669 posts, incept 2013-02-13
2022-09-16 12:01:00

Nope. No adding exposure at this house. Averaging down isn't a very good plan. It IS a good plan to lose all one's cash however.

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I remember the Diamond Princess.


Slowly at first, then all of a sudden.
Thombradley 209 posts, incept 2021-11-01
2022-09-16 12:29:00

I believe issuing additional shares has a name existing shareholders call it I think it begins with a D
Nelstomlinson 749 posts, incept 2011-12-21
2022-09-16 12:31:54

I was 100% in cash by 2011. I bought land, built my retirement home on it, moved in. i have no debt, no financial assets. It's worked out really well so far.
Clay3482 2k posts, incept 2008-11-13
2022-09-16 12:35:55

I honestly do not think there is a place that you can hide without taking some type of haircut, if this is the real correction.

Understand the last 8 year business cycle / debt cycle that was allowed to clear completely was 1992. The 2000 dot com bubble was postponed due to 9/11. The 2008 great Financial Crisis was bailed out because of Bernanke telling congress that if they didn't pass TARP it would mean tanks in the streets.

So if this is the real correction then we should see massive deflation in housing, metals, land, etc etc everything really since this is the everything bubble.

I am diversified. I actually changed jobs so that I could cash out my 401 K, yes I paid the taxes, and the 10% penalty but I did not want to see a drop in value of 85% more or less, which is what I thought I would see if I kept it in the narrow options that my company would let me invest in.

I finished paying off ALL DEBT. Everything. Credit Cards, Mortgage, Daughters College, everything. I bought some more preps such as food, and self defense items. I got a bigger propane tank and filled it up. basically I tried to store my cash in items that represented wealth, and stress relief.

Understand if this is the great correction, there is no way you can buy enough preps as in food to outlast the years that we have in front of us. It is pretty plain to see that The USA has decided to throw Europe under the bus and export what inflation we can to them. It is also plain to see that we want a direct confrontation with Russia so that the West can get the mineral, energy, and resources in Siberia.

With the amount of leverage in the system when it gets to the point of Margin calls and forced liquidation it is going to be a long way down. China will not rescue the worlds economy this time as they have a huge real estate collapse that is taking down their economy already, before the demand destruction caused by high inflation in the west.

The entire 3rd world will be on fire this winter, which is summer in the southern hemisphere, as inputs on food production will start to show up. The 3rd world is fucked.

To put it simply, right now is not the time to worry about the return ON your investment, but rather it is the time to worry about the return of your investments. Keep Cash. Get debt free. Buy what you think you will need for at least 12 months out, start using it and rotating your stock. Stay as Liquid as you can, ready to get some deals when asset prices fall 75% or more and if you are in a big city / blue hive - my advice is get out now. Go somewhere rural.

We are in a transition from a UniPolar world where the US was able to dictate to everyone what had to happen, to a MultiPolar world where there will be at least an option for countries to follow if they do not want to follow the US. Just like when 13 little colonies stood up to the most powerful military in the world because they wanted to have their own self determination, 65% of the worlds population is at the same crossroads. While it will be hard, they have to decide if they want freedom or not.

At the same time the US will have to either accept reality like England eventually did, and wait and watch those 13 colonies fail or succeed or the US will go the USSR route and squash any and all opposition. Not only foreign but also domestic.

I have no clue how this will play out.

I do know that the FED has to continue to raise Interest Rates until their is capitulation, and demand destruction. If they do not get it done by November then it will be real hard as the 2nd wave of energy inflation will hit hard and fast as the complete energy sanctions on Russia kick in and SPR will be at a record low and need to be refilled. They have to cause demand destruction and a collapse in energy prices because of demand destruction before Nov/Dec or they will have a credibility problem, and will have to do what Volker did and go mid-evil on interest rates to save the US Dollar.

They have to save the US Dollar, Nothing else matters. The Jan 6 stuff and the RED Get MAGA speech shows you that they are scared to death of domestic problems. They can fight a few here and there but not 50% of the country. SO buckle up, get ready, and get somewhere safe. Enjoy time with family. Prepare as best as you can physically and emotionally but then live your life. Enjoy what you can while you can.
Joedirt11 44 posts, incept 2022-07-08
2022-09-16 12:45:20

I have read TG off and on since 2008. That is the time in my life I wanted to learn how the world of economics really works. Actually I realized I had gained that interest because prior to that I wanted to understand the political system. That led me to economics. Follow the money. It's also when I realized the entire system is built on debt and the gov is not your friend. I've stood on the premise that rates can't rise significantly or the entire system (corp and gov) will implode. I still am in that camp even though TG is not. I do think there will be another hike but that will likely be the last. I also believe the gov will bail out tbtf again. Time will tell.

Off topic, what do you make of senator Grahm (I despise the guy) deliberately sabotaging the party with his stupid abortion bill? That was on purpose. No way it wasn't. Now there are reports the GOP is pulling some campaign funding from races in AZ, PA, and WI. Three critical states I would think need more money not less. I believe the candidates in these states are also endorsed by MAGA man? I know Masters in AZ is. I suspect you will see the rino's in the GOP do things like this to sabotage the MAGA candidates because they don't believe in the uniparty and don't tow the uniparty line? The dems are funding these campaigns because they think MAGA can't win. I predict this backfires on them spectacularly if the elections are even slightly fair?

https://www.azcentral.com/story/news/pol....

Not the best source but damn google is the goat of search engines! I'm trying to get away from g. It's not easy.
Tickerguy 188k posts, incept 2007-06-26
2022-09-16 12:46:28

Quote:
Off topic, what do you make of senator Grahm (I despise the guy) deliberately sabotaging the party with his stupid abortion bill?

Oh its definitely intentional - but it points out that BOTH SIDES are perfectly happy shooting themselves in the head and believe they can get away with it without being eaten.

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NASA faked out a computer instead of running the test.
Then tried to launch and aborted instead of going "BOOOM!"
Did they abort the JABS after faking THOSE tests?

Workerbee 4k posts, incept 2009-03-18
2022-09-16 13:00:04

I have 10% salary going to my 403b, money market.
I already have the max going to my HSA.
One way or another, the amount of money going to my retirement is gone.
I'll pay it in taxes or gamble in the 403b.
I guess I'm a gambler.


DH recently cashed his retirement with minimal penalty.
We're now debt free (except for < 3k+ vehicles...will be paid off by December...we like having the extra slush cash and mattress stuffing on hand).

Paid cash for a guns and butter, a shed, insulation, solar stuff, some fun stuff and a shit ton of additional preps.

The day my employer goes outta business or I turn 59 1/2, I'm cashing that bitch.

I trust the market about as much as the .gvt



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'Keep pushing fuckers, you'll find the trip wire eventually'
~ Quik49

'This is the part where you find out who you are'
Jw. 559 posts, incept 2019-10-10
2022-09-16 13:10:11

The New American Dream?

It's 1990, start a marginally productive business with a decent product. Get established and then expand (via debt) into a large business with a strong, high turnover "profitable" product. Borrow (to expand even though ULM knows that if the rate goes up the model is unsustainable) and roll over the debt following the interest rate down. All the while upper level management gets PAID six plus figures, the owner, seven plus. Play the numbers so the profit is just ahead of the projections. When it no longer pencils out the company goes belly up and upper level management (who are now millionaires) retire in style. The rest, primarily the lower level workers get thrown out on their ass. Business is liquidated and ULM gets away without any financial consequences whatsoever....

Did I get it right??




@Clay3482, a little of raising rates and a little of 'encouraging' Europe's (and other nation's) economies to go into the toilet to keep the dollar strong... I think they want domestic problems, it would make a great excuse to let full tranny out of the box. Honestly there should already be that fight but somehow a certain group of people have been 'tamed' and rendered action-less. I think that by the time that group realizes it was had, we will be past the point of no return.



The spending must continue until it can't.

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The spending must continue, until it can't.
Wayiwalk 509 posts, incept 2016-11-09
2022-09-16 13:53:54

Most of us live in the US. We are all taking a haircut of sorts, for some, it will be a scalping, others, a buzz cut, and for smart folks, a trim. As your dollars buy less, even if you are completely out of the markets, you are getting a trim.

May the folks on MSNBC and other financial rah rah shows get scalped and a Brazilian wax job executed by a pit bull.

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The Lockdowns Will Continue Until the Morale Improves!

I keep thinking, "it can't get any worse" and then it does!
Smokintoad 122 posts, incept 2014-10-14
2022-09-16 13:54:02

Quote:
Hmmm, looks like the "crank of leverage" is about to go brrrrrrrrrrrrrrrrrrrrrrrrrrr in reverse.


Abelardlindsey 1k posts, incept 2021-03-26
2022-09-16 13:55:02

Quote:
Oh its definitely intentional - but it points out that BOTH SIDES are perfectly happy shooting themselves in the head and believe they can get away with it without being eaten.


But why? How does Graham benefit by damaging his own party?

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It's all in the mitochondria.

"It's the future, and...you're not."
Fdmt 3 posts, incept 2021-08-24
2022-09-16 13:55:02

Quote:
Most say the stock market via IRAs, 401Ks etc

I'm a dumb guy who resembles that remark because I literally don't know what else to do.

Lots of folks here saying cash out.

Other folks here saying (I think) that cash above FDIC limits is as good as gone.

So if one sells off equities, where does all of that cash go? Into a mattress?

If you're holding metals, where do you store it? Five hundred ounces of bullion under your bed?!

If we're at the point where the only answer is "buy guns, ammo, and food", I'll resign myself to "Don't worry, be happy!" because I'm not going to survive the Mad Max phase anyway.
Abelardlindsey 1k posts, incept 2021-03-26
2022-09-16 13:55:02

What I don't understand is why Lindsey Graham would want to damage his own party. In general, politicians survive and build their careers by blowing with the electoral winds. If there is some massive American first sentiment brewing among the voters, you would think that career politicians would first analyze it to determine if its for real or not, and if real, would seek to co-opt it for no other reason that to protect their political careers. This was the standard MO during Clinton's time as well a Bush II.

For some reason, the current politicos either seek to sabotage their own party or simply retire from politics. It doesn't make any sense to me as it does not seem to be in the self-interest of someone who want to maintain a political career.

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It's all in the mitochondria.

"It's the future, and...you're not."
Abelardlindsey 1k posts, incept 2021-03-26
2022-09-16 13:55:02

Quote:
It's 1990, start a marginally productive business with a decent product. Get established and then expand (via debt) into a large business with a strong, high turnover "profitable" product. Borrow (to expand even though ULM knows that if the rate goes up the model is unsustainable) and roll over the debt following the interest rate down. All the while upper level management gets PAID six plus figures, the owner, seven plus. Play the numbers so the profit is just ahead of the projections. When it no longer pencils out the company goes belly up and upper level management (who are now millionaires) retire in style. The rest, primarily the lower level workers get thrown out on their ass. Business is liquidated and ULM gets away without any financial consequences whatsoever....


The English language word for this is grifting.

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It's all in the mitochondria.

"It's the future, and...you're not."
Supertruckertom 7k posts, incept 2010-11-07
2022-09-16 13:55:02

Freight Report.
Slowing.
Our buddy over at SAIA told us that 6 scheduled nightly runs out of Atlanta were cancelled due to lack of freight volume.

Company cook out day yesterday afternoon at my job.
Talked to dock Supervisors and office Supervisor.
Freight volumes are back to 2016 levels.

It is more then just Fed Ex.
LTL and I would surmise truckload is seeing it.

Glad Estes is a debt free company, and privately held.
I may work less, but still have a job and make my bills.
No vaccine mandate here either.

Wife's job is in limbo but the way they keep calling her into meetings for the restructuring sure shows she is in demand.

Just what agency will she work for in December or be in Private sector contracting?

Nothing signed and on paper for what that is worth.
GA HB 1331 of 2022 is the restructuring Bill.


Really surprised it isn't a Gubernatorial Campaign issue.

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Preparing to go Hunting.
Jules 891 posts, incept 2009-04-18
2022-09-16 13:55:02

@Bluebird - thanks for the trip down memory lane. Everyone else - go read that ticker.
And to @Tickerguy:
Quote:
None of this will happen. Not one person in 1,000 that reads this Ticker will do it, and not one of the 50 that do take this step will enlist their neighbors to do it too.

Yes. Yes, I did take those steps. And, once again, thank you for that advice. I sleep so much better now without a mortgage, car loan, or credit card bills to pay every month. Not everyone can do what I did. I don't have a family to raise. But as the old saying goes, "If I can do it..."

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'2023 is going to be shithole bad' - Clay3482 5/24/22

My new favorite insult is "You sound vaccinated"
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