patrick.net

sit on cash till good news

no good news = no green

clambo says

I think it has 10% more to go down.

That would equate to about the S&P 500 being at the all time high just prior to the March/April 2020 bear market.

So the bottom in this bear market is near the top of the last bull market (June 2010 to March 2020).

.

ad says

That would equate to about the S&P 500 being at the all time high just prior to the March/April 2020 bear market.

So the bottom in this bear market is near the top of the last bull market (June 2010 to March 2020).

Hircus says

I think many missed the boat and didn't buy near the bottom because they awaited further declines that never materialized.

I missed the boat. I don't want to miss again. Seems like bad news is already built into several stock prices (maybe not completely).
Market is closed for the first time ever for Juneteenth. Wtf?

clambo says

I think it has 10% more to go down.

Agreed. I suspect Dow will bottom at about 28,000, then bounce around for a bit. Once midterms are over market will start to go back up and probably finish the year just over 30,000.

We're still heading towards a recession/ stagflation but the markets won't tell the true tale of how main street is suffering. Wall Street has been disconnected from the real world for almost a decade.

GreaterNYCDude says

Wall Street has been disconnected from the real world for almost a decade.

Right. However, there was a time, before the past decade decade when markets reflected what was happening on the main street. Seems like our country is all about finance control and manipulation (as opposed to China which is all about technology and manufacturing)

You guys are going to screw around and coin the Minsky Hour.

Tenpoundbass says

You guys are going to screw around and coin the Minsky Hour.

Please elaborate Tenpoundbass.

1337irr says

Tenpoundbass says

You guys are going to screw around and coin the Minsky Hour.

Please elaborate Tenpoundbass.

https://en.wikipedia.org/wiki/Minsky_moment

If the Minsky Hour does not happen by itself, it could always be engineered, I reckon.

Overall P/E is still pretty high. I think there could be a lot of sudden downside but any upside will be slow and gradual. I not rushing out to buy anything right now; sitting on a bunch of cash earning 0.01% (which is better than losing 30%).

Federal Reserve manipulation is the big thing to watch. I think the Fed will try to split a fine line between inflation and recession and we'll wind up with some "excess" inflation and some economic slowdown / recession. Because nothing will actually be resolved, this could continue for years.

SunnyvaleCA says

sitting on a bunch of cash earning 0.01%.

Friend, you can earn more than that with a high degree of safety. I am not talking about "Money Market Funds" which are not insured by the FDIC.

Brokered FDIC backed one month CD's pay a significant fraction of a percent. If you want more than 1.0 percent you need to go out to 2 to 3 months. Higher rates for longer terms. These are brokered at Fidelity and Vanguard in $1000 increments. No commission is charged. (Maybe they get some consideration from the bank that issues the CDs?)

Treasury Direct, which has even finer granularity ($100 increments) will sell you Treasury Debt with no fees. You will get market rates for all the terms: 1 month, 2 month, 3 month, 6 month, 1 year, etc. The one month yield is approximately 1%.

B.A.C.A.H. says

Treasury Direct, which has even finer granularity ($100 increments) will sell you Treasury Debt with no fees. You will get market rates for all the terms: 1 month, 2 month, 3 month, 6 month, 1 year, etc. The one month yield is approximately 1%.

Thanks for the heads up on this B.A.C.A.H., I'm going to check out the T-bills when purchasing I-Bonds. I've been looking for a safe interest bearig mattress to stuff my emergency fund under...

But AZZ yields 1.61% and you can sell cover calls for extra money!

In a few weeks I will convert some of my IRA to a Roth IRA, it's a good time to do it.

I'd rather pay the tax on conversion of things that are down 25%+

SunnyvaleCA says

Overall P/E is still pretty high.

S&P 500's P/E ratio (trailing twelve months) is 18.5 and around the average P/E value from 1980 to present day.

https://www.multpl.com/s-p-500-pe-ratio

....

P/E is a decent ratio to measure, but investors need to take in context growth of a company. FB might be a great value at this point even though the company is matured at 12 for its P/E. KHC might not be worth it at 35, but it's book value per a share is pretty amazing!

Still, I'm buying AZZ. I think the market they have and where they are located makes sense for long term growth and it is at 12 for a P/E.

https://www.multpl.com/shiller-pe
Current Shiller PE Ratio: 28.39 +0.06 (0.22%)
4:00 PM EDT, Fri Jun 17
Mean: 16.95
Median: 15.87
Min: 4.78 (Dec 1920)
Max: 44.19 (Dec 1999)
looks still not cheap. Is this better indicator than regular P/E.

This is what I did for my last purchase. I bought NU. Why? Because Warren Buffet bought it too. I bought it at a lower price than him ($3.34). Does this kind of foolishness make any sense for stock picking? I am going to hold this one for 5 years.

1337irr says

P/E is a decent ratio to measure, but investors need to take in context growth of a company. FB might be a great value at this point even though the company is matured at 12 for its P/E. KHC might not be worth it at 35, but it's book value per a share is pretty amazing!

Still, I'm buying AZZ. I think the market they have and where they are located makes sense for long term growth and it is at 12 for a P/E.

I will review what Value Line Investment Survery says about AZZ

Pleasegabbar says

1337irr says

P/E is a decent ratio to measure, but investors need to take in context growth of a company. FB might be a great value at this point even though the company is matured at 12 for its P/E. KHC might not be worth it at 35, but it's book value per a share is pretty amazing!

Still, I'm buying AZZ. I think the market they have and where they are located makes sense for long term growth and it is at 12 for a P/E.

I will review what Value Line Investment Survery says about AZZ

Please let me know what you find out, a second opinion is a good thing.

1337irr says

Please let me know what you find out, a second opinion is a good thing.

Sure thing. Residents have a free subscription to Value Line Survey through our local public library.

1337irr says

Please let me know what you find out, a second opinion is a good thing.

Here is their take on AZZ

Thanks! The labor shortage is interesting...

Would anybody here be interested in making an activist shareholder company to fight wokeness? I figure we could pool our shares in some management company to try to get companies like Disney to be less woke.

1337irr says

Would anybody here be interested in making an activist shareholder company to fight wokeness? I figure we could pool our shares in some management company to try to get companies like Disney to be less woke.

Not sure if anti-wokeism will have a long term market. If Democrats loose in the next couple of elections, they might drop wokeism and adopt a different strategy. Or not. Time will tell.

1337irr says

Thanks! The labor shortage is interesting...

Morning Star's fair value for AZZ is 53.

Is the buying opportunity of the decade just around the corner (December to March time frame)?

gabbar says

Is the buying opportunity of the decade just around the corner (December to March time frame)?

you never know, but it feels like its coming.

idea though is to buy at discount, not all at once in case false bottom

gabbar says

idea though is to buy at discount, not all at once in case false bottom

I buy 50%, then followed by two 25% purchases. Not sure if this the right plan. I am a dumbo, I had bought Netflix many years back when it was $7 and then sold it for a quick profit. I didn't know any better and I didnt have anyone to guide me.

Wanted to share this comment from Gary Friedman, Chairman and Chief Executive Officer of Restoration Hardware. He has a reputation for being truthful and sincere. He expects the next several quarters to be "a short term challenge".

"The deteriorating macro-economic environment has resulted in lower than expected demand since our prior forecast (a few weeks back), and we are updating our outlook, particularly for the second half of the year".

gabbar says

Netflix many years back when it was $7

You may get that opportunity again ..

SunnyvaleCA says

sitting on a bunch of cash earning 0.01%

Ally Bank is paying 1%

Booger says

Ally Bank is paying 1%

I do have ALLY on the watchlist. Its a Buffett stock. Hoping to catch it at a lower price point in August.

Booger says

You may get that opportunity again ..

I will buy with a bucket if it does but its not likely.

I have no fucking idea what the stock market is going to do. Just buy dividend aristocrats and you should be able to retire in Caligulan splendor at some point without having to touch the principal. Just make sure that you have a good will to make sure that your estate goes to someone in Poland to make sure that white people get your money when you croke.

American Express Savings Account pays currently 1% APY
https://www.americanexpress.com/en-us/banking/online-savings/high-yield-savings/

You can get more than 5% now on certain US bonds, like TIPS.

https://finance.yahoo.com/news/morning-brief-tech-stocks-first-half-2022-100037356.html

"Facing one of the worst downturns we’ve seen in recent history" - Mark Zuckerberg, July 1, 22