patrick.net

BlueSardine says

As an aside do you speak englush?

I know I know... bond market lingo ... I naturally assume I am speaking to an audience that knows the general baseline assumption of the topic in my language

Key lines to watch on 10's

Close above 2.44% and next trading day follow through you're testing 2.62%

We close under 2.03% next trading day follow through should get us to 1.87% on 10's

If we are to break lower in yields we should break under 2%

Last few moves lower in yield for bonds have created yield slippage at key levels, so respect the trend.

However, just be very stubborn to break below 2% this year so I have to respect the market place not letting the 10 year yield go to one handle this year

Right now conventional wisdom is we test the 2.40% - 2.44% range with the recent moves but I am still sticking to the break off that 2% level this year because 2.038% still doesn't count

Very tight range in yields this year unlike the previous years where you can see the action pre 2017 more with this chart

Logan Mohtashami says

My favorite idiot.

It hasn't happened up to now,it can never happen.
What MAGA is that the U.S. has never had a small downturn or Depression.
Happy days are always here.

CHARRRRRRRRRRRRTTTTTTTSSSSS!

Good to see a Logan thread up in here.

For guys like HEY YOU and DEEPCGI every bull agrees that in the next 500–1000 years America is finished. However we understand that just because it's "inevitable" does not mean it's "imminent".

The reality is we get about 80 spins on this planet and only 40 of which involve our finances. Thus there is a stunning arrogance in your position that the once in a millennium kaboom will happen during your watch.

For guys like HEY YOU Who is in the twilight of his existence, all I can say is I'm sorry it didn't work out for you. I'm sorry that you sidelined yourself in the 70s or 80s getting out (at DJIA under 2k) Now you are too old to risk it and must live on your meager savings for the last 15 spins you have on this planet. I'm sure you will still be here snarking and trolling till your last breath - and no doubt you WILL see other collapses, but none powerful enough to knock the markets down to the 1970s 80s level where you decided to "wait out the kaboom". Again I truly am sorry it didn't work out like you thought.

However, for younger guys like DEEPCGI There is still time for you. I truly suggest the "inevitable does not mean imminent" lesson that every investor should. Take your licks from the "1994 till current" or whatever sideline position you took and slowly start backing away from it. 40 - 50 years from now when you draw your last breath you will thank me for this. Good luck.

Logan Mohtashami says

Remember 2/3rd of our labor force have some form of college education now

And how is that going to help when competing with outsourcing and other wage pressures. You clearly don't work for a large corporation.

tr6 says

wage pressures.

Every wage factor we have is basically at all time highs

Logan Mohtashami says

Every wage factor we have is basically at all time highs

Personal income is not wages. The graph above depends on corporations paying dividends, rents going up, etc. Wages, minus factors dependent on asset inflation and wealth effect, are not that great.

tr6 says

Personal income is not wages.

Be mindful, median income is population adjusted and doesn't count for benefits

Real wages are making good gains because inflation is low

So, basically a thesis for a Roman empire collapse of America is a open war that we will lose and it won't be stimulative to the economy either like it was in the past

If you want to go with that dude, all yours

When the recession happens, unless this cycle last another 7 years, oh lord the bears would hang themselves by then... it will look more like 2000 than 2007.

However, can't look that far out in time, really working off 90 day data lines always.. Even the yearly predictions are suspect to changes late in a cycle not so much in the early years or mid cycle.

This will be the longest economic expansion ever..

The Bears never learn. There is no no reason for a recession on the horizon. We are gonna see the greatest home construction boom in the next few years. Home building and it's related services are such a huge part of the economy, there is no way we can have a recession. Sure there will be a recession one day, but not in the foreseeable future.

Strategist says

greatest home construction boom in the next few years.

Years 2020-2024 you have better demographics for housing construction, always was going to be impossible to hit the 50 year moving average in this cycle but the next decade should look better than that chart above due to chart below

As we have replacement workers we do have replacement buyers, just have less capacity in context to boomers because of all the homes we have built for decades as those homes will still be around when the boomers die off



Single family starts still growing, MF boom in terms of rate of growth has cooled down since the 2015 Tax credit expiration

https://loganmohtashami.com/2017/09/19/hurricanes-harvey-irma-maria-and-housing-starts/

Logan Mohtashami says

Years 2020-2024 you have better demographics for housing construction, always was going to be impossible to hit the 50 year moving average in this cycle but the next decade should look better than that chart above due to chart below

As we have replacement workers we do have replacement buyers, just have less capacity in context to boomers because of all the homes we have built for decades as those homes will still be around when the boomers die off

What a beauty. We have a lot of catching up to do in the home building sector.. Add to that the positive demographics emerging for the home construction business.
It's an opportunity of a lifetime folks. Buy homebuilders NOW.

Strategist says

Buy homebuilders NOW.

KBH $10 bucks was a steal back then ;-)

Three generations ago we would be spending this time hustling to ensure we had enough to eat next week.

Now, we spend that time on the Internet screeching at one another about how "terrible" everything is.

deepcgi says

The most amusing part though, from the perspective of the R&D I have been involved in for the past 8 years, is that you seem to believe you will not have to tear your shacks down to the baseboards to be on the wise side of the next big fear.

Tell us more.

Logan Mohtashami says

Strategist says

Buy homebuilders NOW.

KBH $10 bucks was a steal back then ;-)

It's still a steal. My largest holding is "ITB" - Home builder ETF. Up 33% in the last 12 months.

Strategist says

"ITB"

KBH since $10

Logan Mohtashami says

1. Longest job expansion in U.S. history, almost double the previous record

https://fred.stlouisfed.org/graph/?g=fgh1
1959 - 1973: 25 million jobs gained ~50% expansion in jobs vs. 30% expansion of working-age population.

[mild recession in 1960 saw 200,000 jobs (0.4% of workforce) lost but that's irrelevant to the bigger picture]

1974 - 1980: 12 million jobs gained -- 16% expansion in jobs vs. 12% expansion in population

1981- 1990: +18M jobs -- 20% expansion in jobs vs. 10% expansion in population

1991 - 2000: +22M jobs -- 20% expansion vs. 13% demographics

2001 - 2006: +6M jobs -- 4.5% expansion vs. 7.8% demographics (in 2005 boomer echo was age 5-23)

2007-2016: +6M jobs, 4.6% expansion vs. 5% demographics

(these are peak-to-peak numbers, Dec 2007 employment level wasn't recovered until mid-2014)



shows how the Fed pumped $3.4T of new money into the economy 2009-2014.



red is corporate profits added. Flat since 2012 oddly enough. Something rotten in the State of Denmark with that.

Graccius was about 150 years before Diocletian. So if we are (your words) mirroring Rome year for year we have a 150 year golden era before peak and several hundred years of decline.

Double hooray!!!

Bellingham Bill says

(these are peak-to-peak numbers, Dec 2007 employment level wasn't recovered until mid-2014)

Do you guys realize that

A. Longest job expansion on record

B. We have 6,200,000 job openings, the highest every in human kind history

So much for the pathetic 96,000,000 people out of work non sense

C. Outside the Hurricanes, unemployment claims look really good

Even with manufacturing going into a recession in the U.S. in this cycle

tr6 says

Personal income is not wages

indeed! everybody knows WASCUR is wages :)

blue is PI, red is WASCUR, green is WASCUR / PI (right axis)

Bellingham Bill says

One of my favorite Cute cuddly American bear charts it goes into the category



D. The extreme left wing makes everyone out to poor to hate on Capitalism

Logan Mohtashami says

Even with manufacturing going into a recession in the U.S. in this cycle

capacity is at recessionary levels still

not that that is necessarily a bad thing, idle capital is still capital, but the question is jobs.



no movement on the needle in manufacturing jobs since 2010.

I agree the construction print is a crime and should be double that to replace our shitty aging postwar housing stock

green is information jobs, software is still eating everything.

Bellingham Bill says

Even with manufacturing going into a recession in the U.S. in this cycle

Prime example .... what I tell the kids, is when these old guys run manufacturing charts ... show this

then show the Output charts






I wrote this article Manufacturing Under President Donald Trump

https://loganmohtashami.com/2016/12/09/manufacturing-under-president-donald-trump/

To show exactly why the American bears hooked on Manufacturing jobs were going to be blazed out wrong ... Dean Baker got me on this with his rants of that the Dollar needs to be 20% lower for output and jobs to come back

Not 1940's -1960's anymore old days ... Productivity gains came in this sector leading to higher output

Logan Mohtashami says

Which still needs to live off a weak yen

360, now that was a weak yen. 110 is still on the strong side, McDonald's wages are $13/hr there, vs $19 when the yen was at 80.

150 would be getting on the weak side again.

Bellingham Bill says

Which still needs to live off a weak yen

Logan Mohtashami says

weak

110 isn't weak. It's in the normal range. 80 was making Japanese labor utterly non-competitive with the US, let alone the cheap-labor countries.

Bellingham Bill says

Who do you consider extreme left?

Extreme Left = MMT ( Bernie Sanders Crew) God Bless Bernie for wanting to pay for everything as that makes him a No Go on MMT .. ..

Extreme Right = Gold Bugs Anti Central Bank

If you don't consider yourself any of this .... then you're not in that group

Bellingham Bill says

110 isn't weak. It's in the normal range. 80 was making Japanese labor utterly non-competitive with the US, let alone the cheap-labor countries.

I even spelled it out with the chart dude .. I am not talking about recent moves, they want the Yen weaker of course but it always doesn't work that way

This will be my last post on this thread and for 2017. So let wish you all a Happy Thanksgiving, Christmas and New Years all at once

and know... the future .... it will not be nameless, it will not be faceless, it will not be heartless .... We are the United States of America, our people will succeed!

Cheers gents now you all can go back to your regular scream fest

#USA

Logan Mohtashami says

I even spelled it out with the chart dude

you're cherry-picking the yen graph

https://imgur.com/a/5Gtfh

Logan Mohtashami says

This will be my last post on this thread and for 2017

Come in here, diarrhea a bunch posts with graphs that you can't defend, and leave. That's Logan.