The Great 2022 Stock Market Crash
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When Time magazine says "stocks are dead".
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We are off to a good start. I think I heard one of the talking heads on BNN, CNN or wherever mention over half the analysts are saying we are going to enter a bull market this year.
I hope you meant December 2022.
I think we're still in the bull market.
We're just seeing the expect impact of significant interest rate hikes and the expectation of more.
Market is still up very nicely.
It seems like "market watchers" have no attention span, we've had a tiny dip from the peak just a few weeks ago, for completely reasonable and foreseable reasons.
But I guess if there is nothing going on, you still need to make some news.
History does repeat itself. Every time the fed has been in a lengthy sustained tightening mode we have a bear market. The fed is into a lengthy sustained tightening mode. How do I know? they have told us in clear language that they are going into a lengthy tightening mode.
"buy when there's blood in the streets." - Baron Rothschild
The Nasdaq is down 33%, the S&P 500 and the Dow are pretty close to 20% and the average PE is still above the long term average. Canada is doing better because we have a heavier weighting on commodities and energy . Recently those two sectors seem to be turning bearish as well. I think we still have a lot air to let out. I hearing people describing stocks as value stocks when they have a PE of 20 or 25.
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Exactly that. We're already on the verge of a correction in the markets. Next step is entrez-vous, Monsieur Ours.
It's a short term blip, which we get all the time.
We're not even down TTM, and I'd say a financial year is the minimum time period to analyse any equity performance.
will comeback to this post in December 2022. I wouldn't be surprised if there is another -20 to go.
Still no blood, really, other than the tech and crypto wreck. Although, the test of the bear market on the S&P 500 is real. And markets are below 200 day moving averages. You would think it has a good shot of happening.
I use 20% drops in the market as an entry/addition point. This is definitely an entry point, so I'm looking actively. But it's not "go all out" - I would take further action if there was a 30% drop. This was my playbook in 2020 too.
I use 20% drops in the market as an entry/addition point. This is definitely an entry point, so I'm looking actively. But it's not "go all out" - I would take further action if there was a 30% drop. This was my playbook in 2020 too.
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I agree.
I have increased my buys, but I'm not betting the farm. Throwing around a few K's here and there, but I'm not ready to start throwing 5 digits yet.
I'm limping in. Usually a few hundred bucks a day, making sure I don't buy too early. (Yes, a few hundred a day, because I don't pay commissions).
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18,557 Posts
Berkshire still looks pretty good......still green at 6M, YTD, 1Y, 5Y.....
They are sitting on about $145 billion in cash and no doubt getting some phone calls and looking around for a bargain.
Wouldn't it be funny if Warren and Charlie bought Twitter, now that Elon is balking at the deal ?
They are sitting on about $145 billion in cash and no doubt getting some phone calls and looking around for a bargain.
Wouldn't it be funny if Warren and Charlie bought Twitter, now that Elon is balking at the deal ?
Matters how much the government tries to "fix" things
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I find it interesting to consider the parallel that we may be entering, if the world devolves into another deep recession.
While the Fed, BOC, and central banks around the world try to navigate out of the current situation, it is important to consider the financial damage the Great Recession of 2008 caused.
The question for today is how high central banks can raise interest rates without causing another deep recession creating all that would follow.
Remember that in the 2008 Great Recession, many companies struggled or went completely out of business. Bear Stearns, Lehman Bros, folded and other companies like Ford, GM, Chrysler struggled to stay alive. The US housing market crashed and the entire real estate and mortgage markets were near death. A lot of Americans suffered deep financial losses.
Here we are today, with companies like Tesla, Apple, Google sitting on top of the markets. What would they look like if the world goes into a recession ?
For those who wish for high interest rates that could cause a recession, it can get very ugly in a hurry.
Here is an inside look at what happened at GM, who where the biggest company in the world.......until they weren't.
After I retired, I knew from high level union friends and a GM Canada executive the battle waging inside GM and how CEO Rick Wagoner had fought on our behalf, and I sent an email to him. I thanked him on behalf of all GM retirees and employees, for not throwing us "under the bus" as some politicians, media and his critics were demanding. I received an email back from him thanking me for acknowledging his efforts and saying it meant a lot to him.
Even most of my GM friends don't know that Wagoner traded off his own resignation to save their jobs and pensions.
www.forbes.com
While the Fed, BOC, and central banks around the world try to navigate out of the current situation, it is important to consider the financial damage the Great Recession of 2008 caused.
The question for today is how high central banks can raise interest rates without causing another deep recession creating all that would follow.
Remember that in the 2008 Great Recession, many companies struggled or went completely out of business. Bear Stearns, Lehman Bros, folded and other companies like Ford, GM, Chrysler struggled to stay alive. The US housing market crashed and the entire real estate and mortgage markets were near death. A lot of Americans suffered deep financial losses.
Here we are today, with companies like Tesla, Apple, Google sitting on top of the markets. What would they look like if the world goes into a recession ?
For those who wish for high interest rates that could cause a recession, it can get very ugly in a hurry.
Here is an inside look at what happened at GM, who where the biggest company in the world.......until they weren't.
After I retired, I knew from high level union friends and a GM Canada executive the battle waging inside GM and how CEO Rick Wagoner had fought on our behalf, and I sent an email to him. I thanked him on behalf of all GM retirees and employees, for not throwing us "under the bus" as some politicians, media and his critics were demanding. I received an email back from him thanking me for acknowledging his efforts and saying it meant a lot to him.
Even most of my GM friends don't know that Wagoner traded off his own resignation to save their jobs and pensions.
How General Motors Was Really Saved: The Untold True Story Of The Most Important Bankruptcy In U.S. History
Five years after an unprecedented government bailout there's no shortage of people--including President Obama--taking credit for rescuing the most important industrial company in American history. But the truth of what happened during GM's darkest days has never been told. Until now.
www.forbes.com
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18,557 Posts
As to the above.......the housing market is key.
We can withstand some carnage in the stock markets, we can survive some higher prices, but if the housing market collapses, we will be in deep trouble.
I think we are teetering on the knife edge right now.
We can withstand some carnage in the stock markets, we can survive some higher prices, but if the housing market collapses, we will be in deep trouble.
I think we are teetering on the knife edge right now.
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The Fed can't raise interest rates high enough to battle inflation caused by supply/demand metrics due to the pandemic collapsing supply chains, because it would cause an uncontrollable severe recession.
The Fed can't very well sit on their hands and do nothing while inflation runs rampant.
They are left with raising the interest rates a little and hoping that has a desired effect. They are basically "hoping for the best".
There isn't a shortage of baby formula in the US because of money printing or an excess number of new mothers needing formula.
Prepare for high inflation until the supply chains get untangled. Hopefully it won't be a long wait.
The Fed can't very well sit on their hands and do nothing while inflation runs rampant.
They are left with raising the interest rates a little and hoping that has a desired effect. They are basically "hoping for the best".
There isn't a shortage of baby formula in the US because of money printing or an excess number of new mothers needing formula.
Prepare for high inflation until the supply chains get untangled. Hopefully it won't be a long wait.
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