Rough week in the stock market...

[CosmicCowboy]

I'm down 6K in 5 days.

how about you guys?

[Wilt Chamberlain]

I'm down 6K in 5 days.

how about you guys?

I'm busy trying to gain cred by making up shit about how much money I make on a msg board. Haven't checked the market.

[Spurminator]

Hurts, but glad I pulled 20% out of stocks for a down payment last week.

[CosmicCowboy]

Hurts, but glad I pulled 20% out of stocks for a down payment last week.

I took some losses last week thinking this was going to happen and went to 50% cash. About to put it back in, though...one of my favorite long term plays ( a LNG company in final stages of approvals) is getting killed along with oil prices. About to buy back in dirt cheap next week.

[InRareForm]

I buy stock with the notion of divedends. I don't worry about the inevitable falls and declines. I am in it for the steady stream of cash with solid companies.

Speaking of which... Time to buy some more

[Spurminator]

I don't have nearly enough in the market for dividends to amount to anything.

[ChumpDumper]

You guys see a bottom very soon? So many variables.

[DarrinS]

Down 15K in past two weeks.

[CosmicCowboy]

You guys see a bottom very soon? So many variables.

I'm watching energy stocks right now. I think the fracking industry has been prematurely declared dead. Yeah I expect oil to dip into the thirties but I don't think it's gonna stay there. I think it will stabilize around $50 and WILL knock out some of the higher cost lower tech players around the world but the US frack technology will be able to make plenty of money at $50.

[Bender]

Down several thousand recently.

Like InRareForm, I mostly stick with dividend stocks and funds.

[CosmicCowboy]

I love playing with high risk growth stocks. It's like the thrill of Vegas without the hookers and blow.

[CosmicCowboy]

I took it in the nuts on a chinese silver mine play recently...still don't understand what happened on that one...damn company is a proven low cost producer, has 80 million in the bank (almost 50 cents per share cash). Silver has always tracked somewhat along with gold but also has lots of industrial applications...especially in solar panels...every panel made uses 2/3 ounce of silver...with the bazillions of solar panels being produced silver should inevitably increase in value even if gold doesn't...anyway...bought in at 1.20 and then this chinese stock market shit happened and that baby got thrown out with the bathwater and took a major dump...I sold it at 80 cents when it was about to be delisted on the NYSE...

[Bender]

I want to retire in a couple years, i cant be chancy... Been sticking to conservative and moderate-conservative funds. XOM is a very large holding for me though, and thus I've been goin' down down down for about a year.

Nice dividends though :)

[CosmicCowboy]

Sometimes conservative means sitting in cash for awhile. September/October historically has brought some doozy corrections and this one looks to be worse than usual since it was bubbled to start with.

https://dentresearch.s3.amazonaws.com/EconomyandMarkets/images/082115_ENM2a.gif

[CosmicCowboy]

I vividly remember October 19, 1987...I was elk hunting in Colorado...packed out an elk on horseback, loaded the horses and the elk and got in my truck... turned on the radio just as they were saying the DJIA had crashed 500+ points (over 22% at the time) in one DAY. I thought I heard it wrong.

[SpursforSix]

I exited long futures ositions yeasterday in Feeder Cattle and Natural Gas for the only reason that I wasn't going to be around to baby sit them today. Thank God. I think I'm going to look at shorting several commodities futures next week.

[CosmicCowboy]

I'm still pumped about my LNG stock position even though it's been hammered with the drop in oil and I'm down 5K on paper. I'm going to try to catch close to the the bottom and drop another 10K in it. It's well under $2 today and could easily be at $20 in 4 years. The market hasn't realized that the cheaper NG is the more attractive LNG becomes and the LNG plays like Cheniere (not the one I'm playing) get their tolling charge no matter what the commodity price is. Get the long term contracts in place and get the liquification plants built and it's a multi billion revenue stream for 20+ years.

[InRareForm]

I am wondering if vanguard natural resources is a good play soon. Very cheap, they offer 11 cent divendeds , And major upside.

[hater]

down 25k on my portfolio

it'll bounce back, not worried here

[CosmicCowboy]

Interesting play. Super cheap if they can maintain that dividend rate.

[DMX7]

I'm down 6K in 5 days.

how about you guys?

Only 6K down after this horrific weak? I would say you're a winner.

[DMX7]

I am wondering if vanguard natural resources is a good play soon. Very cheap, they offer 11 cent divendeds , And major upside.

I don't know anything about vanguard natural resources but if it's what I think it is, then the reason it's so cheap is precisely because few people think it can actually maintain that dividend... and to be honest, considering the price of oil and where it could be going (even lower), it also has major downside.

[CosmicCowboy]

gonna get even uglier. Dow and NASDAQ down big in futures this morning. China has everyone spooked.

Also, oil into the 30's this morning.

[SpursforSix]

gonna get even uglier. Dow and NASDAQ down big in futures this morning. China has everyone spooked.

Also, oil into the 30's this morning.

Oil has been in the 30's since last night.

My bad...I thought you were predicting oil going to 30's.

[CosmicCowboy]

Whoa! Dow opened 1000 points down.

[Winehole23]

down 603 at the moment

[hehateme]

Lost 7k in the past few minutes. Biggest underperformer that killed me so far the past few weeks has actually been Apple's steady decline from that $134 mark though.

[DarrinS]

http://stream1.gifsoup.com/webroot/animatedgifs2/1424924_o.gif

[Spurminator]

Well anyone who bought at the bell this morning is having a pretty good day so far...

[boutons_deux]

Dow Drops 1,000 Points In Early Trading
http://www.huffingtonpost.com/entry/stocks-are-dropping-everywhere_55db1d1ce4b04ae4970399f8?ir=Business&section=business&utm_campaign=082415&utm_medium=email&utm_source=Alert-business&utm_content=FullStory&ncid=newsltushpmg00000003&kvcommref=mostpopular

[boutons_deux]

unregulated, untaxed capitalism is a fucking riot, n'est pas?

[DMX7]

Well anyone who bought at the bell this morning is having a pretty good day so far...

Yesterday night, financial news reported that China (Monday morning for them) had a major sell off so the writing was on the wall for today.

[DMX7]

unregulated, untaxed capitalism is a fucking riot, n'est pas?

What? You're way off message in this thread. This selloff isn't about regulations/taxes/etc., it's simply about china's economy, and we're all affected in a globalized world.

[Clipper Nation]

It's a shitshow this morning. Liquidity is even worse than the flash crash. The system is so jammed that people can't even make trades.

[Clipper Nation]

unregulated, untaxed capitalism is a fucking riot, n'est pas?
Where's this "unregulated, untaxed capitalism" happening? It sure isn't in the US or China.

[boutons_deux]

Where's this "unregulated, untaxed capitalism" happening? It sure isn't in the US or China.

stock trading on wall st is untaxed, unregulated. high speed trading is a scam. just mention a "sales tax" on stock trading and watch the financial criminals scream like fat pigs.

your financial person will churn your stocks to kill your profits by pocket trading fees, but the buying/selling is untaxed.

[Clipper Nation]

stock trading on wall st is untaxed, unregulated.
Did I miss where the capital gains tax was repealed and the SEC shut down?

[Spurminator]

If the stock market is untaxed, then I'm owed a hefty refund.

[tlongII]

I'm down 6K in 5 days.

how about you guys?

Down over 10K.

[pgardn]

Down over 10K.

>10K

This is the game boys. I'm not going anywhere. Live by the sword die by the sword.
Ill take on more work and make it up.

[boutons_deux]

If the stock market is untaxed, then I'm owed a hefty refund.

stock market TRADING is untaxed.

[DMX7]

stock market TRADING is untaxed.

The gains are taxed. And why should you get taxed on trades that yield realized losses?

[boutons_deux]

The gains are taxed. And why should you get taxed on trades that yield realized losses?

when you sell (for loss or gain), somebody buys, so there should be a "sales tax" on the sale

[DarrinS]

Lol


https://www.youtube.com/watch?v=HslBj2B22lg

[DMX7]

Lol


https://www.youtube.com/watch?v=HslBj2B22lg

We need a little context here.

[m>s]

Glad I'm not in too deep right now, sitting on a mountain of cash going on 2 years now

[Clipper Nation]

stock market TRADING is untaxed.
Again, false. As usual, you're confusing "not up to your extremist standards" with "nonexistent."

The funny thing is, China would be your dream stock market. The top 12 companies are all owned and operated by the government. They've literally banned the biggest shareholders from selling stock for six months in a frantic attempt to prop up the system. And it's a disaster.

[DMX7]

Glad I'm not in too deep right now, sitting on a mountain of cash going on 2 years now

I've earned way more in dividends and net gains that what i've lossed (not even a realized loss) in the last week. Earning 1% interest on your "mountain of cash" is for suckers. You've lost money on inflation alone.

[DMX7]

The market has rebounded BIG TIME from this morning. Down less than 1% now.

[boutons_deux]

Again, false.

when anybody buys stock, what is the govt tax rate on the purchase?

[m>s]

I've earned way more in dividends and net gains that what i've lossed (not even a realized loss) in the last week. Earning 1% interest on your "mountain of cash" is for suckers. You've lost money on inflation alone.
I understand that but today is what I was worried about and the worst may be yet to come. Ive actually invested part of it into other business ventures which earn a much bigger yield than the market so it isn't all In cash

[pgardn]

when you sell (for loss or gain), somebody buys, so there should be a "sales tax" on the sale

Man you really want some poor old folks with retirement to get whipped. This tax will get passed down by the entity that holds their money.

[pgardn]

I understand that but today is what I was worried about and the worst may be yet to come. Ive actually invested part of it into other business ventures which earn a much bigger yield than the market so it isn't all In cash

What happens when your other business ventures lose money? Or you just pull the plug on some guy who has asked you to invest in his lucrative car wash business while he is building 20 new car washes some of which YOUR money went to?

[ChumpDumper]

What happens when your other business ventures lose money? Or you just pull the plug on some guy who has asked you to invest in his lucrative car wash business while he is building 20 new car washes some of which YOUR money went to?I'm sure will have diversified into other imaginary ventures and funds by the time he finishes reading your post.

[pgardn]

It's a shitshow this morning. Liquidity is even worse than the flash crash. The system is so jammed that people can't even make trades.

This is probably a good thing.

[pgardn]

I'm sure will have diversified into other imaginary ventures and funds by the time he finishes reading your post.

It is amazing what estute investors we have on this site.

Im getting crushed. But it's all on paper for now. But it could be realized if for some reason I had to cash out. I just feel sorry for the people who must cash out now to make some payment. I don't want people in financial difficulty to have to suffer from these incidents.

That commercial that simplified trading as: "when you see value in a stock and buy, you are buying from someone equally convinced that the stock has reached a high value and will go down." This is just not the case. People may have to sell to pay bills; They have no other choice.

[pgardn]

Glad I'm not in too deep right now, sitting on a mountain of cash going on 2 years now

Then you lost out on some stellar years of big, big gains.

If you have played this game and not been punched in the face yet then you really have not played the game. Much like fighting, in the parlance of a world you claim to understand.

[Spurminator]

Suddenly I'm positive on the day.

[Aztecfan03]

when you sell (for loss or gain), somebody buys, so there should be a "sales tax" on the sale

It isn't a good or service, so why exactly should it be taxed with a sales tax?

[m>s]

Then you lost out on some stellar years of big, big gains.

If you have played this game and not been punched in the face yet then you really have not played the game. Much like fighting, in the parlance of a world you claim to understand.
didnt miss out on most of it, I may have overestimated by saying two years could be closer to a year ago when I pulled out

[pgardn]

didnt miss out on most of it, I may have overestimated by saying two years could be closer to a year ago when I pulled out

How did you know to pull out?

And last year was also very good for me, just not as good as the year before. So in my world you lost making some very nice profits. Too bad.

How have you learned to time the market so well? Especially considering how many years you have expected an apocalypse? Based on what you post you should be buying only food, water, and weapons. Definitely not stock. I'm trying to help you here.

[m>s]

How did you know to pull out?

And last year was also very good for me, just not as good as the year before. So in my world you lost making some very nice profits. Too bad.

How have you learned to time the market so well? Especially considering how many years you have expected an apocalypse? Based on what you post you should be buying only food, water, and weapons. Definitely not stock. I'm trying to help you here.
Finance background and good intuition. I still have some money out there in 401k. One could only look at the market and P/E ratios and know that the market is overbought. I wouldn't be surprised to see us go a lot lower. The economy is in worse shape than they admit

[pgardn]

Finance background and good intuition. I still have some money out there in 401k. One could only look at the market and P/E ratios and know that the market is overbought. I wouldn't be surprised to see us go a lot lower. The economy is in worse shape than they admit

You should be on Wall Street then. Or an economics professor. People like you are extremely rare. Good intuition is a gift. Do not go into foreign affairs as you have taken a predictive punch in the face. Which if your intuition in this area were accurate should have probably led to financial collapse. Hmmmm....

So I guess you don't follow your own foreign conflict predictions which shows a great deal of self control.

[DMX7]

You should be on Wall Street then. Or an economics professor. People like you are extremely rare. Good intuition is a gift.

No, people who suffer from delusions of grandeur on the internet and can't even keep their story straight on when and what they invest in aren't all that rare.

[m>s]

You should be on Wall Street then. Or an economics professor. People like you are extremely rare. Good intuition is a gift. Do not go into foreign affairs as you have taken a predictive punch in the face. Which if your intuition in this area were accurate should have probably led to financial collapse. Hmmmm....

So I guess you don't follow your own foreign conflict predictions which shows a great deal of self control.
That's the thing, maybe next time my hunch is wrong and I lose money. This time I win and I'm happy.

my only regret is not investing in American Airlines. My father was adamant that they were just posturing for better labor agreement and that they wouldn't fall flat. A few people I know got filthy rich but I was too nervous to risk it.

[m>s]

No, people who suffer from delusions of grandeur on the internet and can't even keep their story straight on when and what they invest in aren't all that rare.
Invested in gm at under 20, Kroger at 22 or something, countless others some of these I more than doubled my money.

[DMX7]

It is amazing what estute investors we have on this site.

Im getting crushed. But it's all on paper for now. But it could be realized if for some reason I had to cash out. I just feel sorry for the people who must cash out now to make some payment. I don't want people in financial difficulty to have to suffer from these incidents.

That commercial that simplified trading as: "when you see value in a stock and buy, you are buying from someone equally convinced that the stock has reached a high value and will go down." This is just not the case. People may have to sell to pay bills; They have no other choice.

You're completely right about that, but small time investors who are forced to sell for immediate cash aren't really the primary drivers of prices imho. Institutional investors drive prices the most.

[m>s]

3m and Amazon were also great investments

[DMX7]

Yeah, my investing skills go way up too with selective memory and the power of Yahoo! Finance's historical data.

[m>s]

Dude you don't have to feel bad everyone is losing money. I would hate to work on walls street. Interviewed for an internship once at an investment firm back when things were really volatile and everyone in the office was on suicide watch. Couldn't work in that type of environment

[m>s]

Yeah, my investing skills go way up too with selective memory and the power of Yahoo! Finance's historical data.
Didn't even have time to go look all those up right quick

[m>s]

You seem a little bit butt rustled at my superior German intellect comrade, no need to feel this way

[DMX7]

when anybody buys stock, what is the govt tax rate on the purchase?

Why should it be taxed? As someone else has already stated, it's not a good or service (i.e., some type of end-product)...A stock in an equity investment (i.e., an ownership interest in a company). Equity investments shouldn't be subject to a sales tax. The investment itself already gets taxed on its income and the dividends it pays out to its investors get taxed again.

In the world you're describing, if I start up a business an make an initial investment of $100K, and then immediately decide to sell half that business to my friend at book value, he should have to pay $50K + 8.25% sales tax??? That's bullshit.

[m>s]

That would be double taxation, commie gtfo

[DMX7]

That would be double taxation, commie gtfo

That would be triple taxation... Double taxation already exists.

[m>s]

True, unless it's a 401k and you buy in with pretax dollars

[DMX7]

True, unless it's a 401k and you buy in with pretax dollars

He's proposing a sales tax on all trades.

If you buy in with pre-tax dollars, that just means the money you're using to purchase hasn't be subjected to personal income taxes yet... but you're still getting hit with bouton's proposed tax eventually regardless.

For example, if you buy a share of IBM, you pay:

1.) Sales tax on initial purchase of the IBM share (a tax paid directly by you).
2.) Income tax on income of IBM which you own a share of (a tax paid by IBM, affecting amount of income available to you)
3.) Distribution of IBM's income from IBM directly to you (a tax paid directly by you)

[DMX7]

FYI - A Roth 401K avoids taxes on dividends but you can only use AFTER-tax dollars in one of those.

[m>s]

He's proposing a sales tax on all trades.

If you buy in with pre-tax dollars, that just means the money you're using to purchase hasn't be subjected to personal income taxes yet... but you're still getting hit with bouton's proposed tax eventually regardless.

For example, if you buy a share of IBM, you pay:

1.) Sales tax on initial purchase of the IBM share (a tax paid directly by you).
2.) Income tax on income of IBM which you own a share of (a tax paid by IBM, affecting amount of income available to you)
3.) Distribution of IBM's income from IBM directly to you (a tax paid directly by you)
You just drew up a boutons proposal, lol. Looks even more batshit insane spelled out this way. That guy is a dangerous lunatic

[ElNono]

http://media.giphy.com/media/ToMjGpQpquWnMevuV1u/giphy.gif

[boutons_deux]

It isn't a good or service, so why exactly should it be taxed with a sales tax?

why not? it's a non-essential "thing" (it ain't food, etc) so tax its sale. NY state and NYC city sales taxes are sky high, so why 1% or 2% of stock trades? why the fuck not?

[DMX7]

why not? it's a non-essential "thing" (it ain't food, etc) so tax its sale. NY state and NYC city sales taxes are sky high, so why 1% or 2% of stock trades? why the fuck not?

So is this tax you're proposing a state tax or a federal tax? And are all equity investments going to be subject to this tax? Bad news for small businesses, if so.

[DMX7]

I would rather cap the amount of income that is subject to special qualified dividend income tax rates.

[boutons_deux]

Why should it be taxed? As someone else has already stated, it's not a good or service (i.e., some type of end-product)

a product is being exchanged, sold/bought, money changes hands, why shouldn't it be taxed? an share is definitely a THANG

[pgardn]

You're completely right about that, but small time investors who are forced to sell for immediate cash aren't really the primary drivers of prices imho. Institutional investors drive prices the most.

But Many small investors enter the market through institutional investors.
The real point though was having to sell to pay bills, not because you thought the investment was bad. You just can't afford to see it go any lower and then rebound.

Agreed though.

[pgardn]

a product is being exchanged, sold/bought, money changes hands, why shouldn't it be taxed? an share is definitely a THANG

So when you convert dollars into Euros it should be taxed because they are things?

[boutons_deux]

So when you convert dollars into Euros it should be taxed because they are things?

why not? there is certainly bank service fee.

[pgardn]

why not? there is certainly bank service fee.

Its a great way to inhibit travel I guess.

Now do we tax our government banks who make these exchanges?

*cue Accountants lathering up while Boots institutes new tax rules*

[boutons_deux]

Its a great way to inhibit travel I guess.

Now do we tax our government banks who make these exchanges?

*cue Accountants lathering up while Boots institutes new tax rules*

bank money changing fee income is taxed as their general income, I guess.

[m>s]

The income is already taxes at the corporate tax rate in the first place, and then you pay a second tax on capital gains. Why would there need to be a third tax? Eliminate capital gains if you want a sales tax. You're literally taxing the income generated by the company 3 times

[DarrinS]

Lost 6K today. Nice

[ducks]

never had it never sold it just on paper
should have sold it last week

[Bender]

Rebounding today

[hater]

down 25k on my portfolio

it'll bounce back, not worried here

As I was saying.....

[m>s]

Hail Victory kameraden, this economic news sure is exciting for our prospects

[pgardn]

As I was saying.....

I won the losses contest.
I don't think people are fessing up.

[ChumpDumper]

Did we just all decide to stop watching?

[DMX7]

Pretty weak ass "rebound", lol.

[CosmicCowboy]

I took my hit and went mostly cash two weeks ago saved myself another 10K in losses. Still sitting on a few thousand shares of one LNG stock that is way down with oil but I'm in that one for the long haul. If oil drops to $32 and takes that stock with it some more I'm gonna load up like I'm Daddy Warbucks.

[Bender]

Pretty weak ass "rebound", lol.
yep, so much for the morning rebound...

[m>s]

Dead cat bounce or were out of the woods?

[CosmicCowboy]

Probably a dead kitten bounce. China market is still going to shit despite all the government intervention. Their stock crash will trigger a liquidity crash that will trigger their real estate crash. They have shed 5 TRILLION in market value since mid-June.

[DMX7]

Anybody start buying yet? I dabbled very lightly in the market this morning... very lightly, but I have cash earmarked for a good opportunity.

[CosmicCowboy]

Anybody start buying yet? I dabbled very lightly in the market this morning... very lightly, but I have cash earmarked for a good opportunity.

I have my finger on the trigger but haven't squeezed it yet. The stock I'm looking at is still dropping slowly.

[DMX7]

Oil is pretty interesting right now. At sub-$40 per barrel prices, it just can't go much lower without companies shutting off supply and quickly pushing the price back up. 12-15 months from now it could easily be back up over $75.

[CosmicCowboy]

Oil is pretty interesting right now. At sub-$40 per barrel prices, it just can't go much lower without companies shutting off supply and quickly pushing the price back up. 12-15 months from now it could easily be back up over $75.

A lot of producers were and are still hedged with contracts based on $80 oil. As these expire you will see production gradually drop but not as much as you might expect. the rig count may drop but it will be your latest generation walking rigs still running and they are a lot more productive than the old school rigs...They can punch 12 or 15 holes on the same pad without ever having to break down and move. That and new tech on the fracking end can still give some of these fields a damn good profit at $40 oil.

[DMX7]

A lot of producers were and are still hedged with contracts based on $80 oil. As these expire you will see production gradually drop but not as much as you might expect. the rig count may drop but it will be your latest generation walking rigs still running and they are a lot more productive than the old school rigs...They can punch 12 or 15 holes on the same pad without ever having to break down and move. That and new tech on the fracking end can still give some of these fields a damn good profit at $40 oil.

You sound like you know about drilling than I do, but we're talking about the big picture broad market here.

I don't think the impact of hedging in this regard or some fields that can sustain an overall profit at $40 is going to have a material impact on overall supply near-term (next 12-15 months).

But we will see... I am obviously only speculating here.

[CosmicCowboy]

I understand that a lot of people are looking at rig counts being cut in half and assuming that production will be cut in half. I'm saying that at least in the US these latest gen II rigs are at least twice as productive as the older rigs which makes the process cheaper and more efficient.

[DMX7]

Great rally today, but most seem to expect heavy volatility ahead.

[tlongII]

I haven't changed my portfolio. Ride or die.

[The Reckoning]

better sell now schlong

[boutons_deux]

So is this tax you're proposing a state tax or a federal tax? And are all equity investments going to be subject to this tax? Bad news for small businesses, if so.

JAMES HENRY, jamesshelburnehenry at mac.com, @submergingmkt (https://twitter.com/submergingmkt)

Henry is former chief economist at the international consultancy firm McKinsey & Co. He is now senior fellow at the Columbia University Center for Sustainable International Investment (http://www.vcc.columbia.edu/).

He said today: “This stock turbulence is a great example of why we need a Financial Transaction Tax.

As brilliantly portrayed in this video by the British actor Bill Nighy (https://www.youtube.com/watch?v=qYtNwmXKIvM), a tiny tax on financial translations carried out by institutions would raise hundreds of billions of dollars.”

http://www.commondreams.org/newswire/2015/08/26/stock-turbulence-argument-financial-transaction-tax

https://www.youtube.com/watch?v=qYtNwmXKIvM

how would stock or bond trading transaction tax be bad news for small businesses.

it would have to be a federal tax because the financial system is worldwide, not state limited. eg, NY or other states with trading exchanges would not impose the tax.

exchanges FLEE the USA tax operate in other countries? I'm pretty sure the industrial countries would impose similar taxes after USA's lead. The revenues would be too enormous to ignore.

[Winehole23]

And this is what most of the commentators don’t get, that all this market runoff we’ve seen in the last year or two has been by the Federal Reserve making credit available to banks at about one-tenth of 1 percent. The banks have lent out to brokers who have lent out to big institutional traders and speculators thinking, well gee, if we can borrow at 1 percent and buy stocks that yield maybe 5 or 6 percent, then we can make the arbitrage. So they’ve made a 5 percent arbitrage by buying, but they’ve also now lost 10 percent, maybe 20 percent on the capital.


What we’re seeing is that short-term thinking really hasn’t taken into account the long run. And that’s why this is very much like the long-term capital market crash in 1997, when the two Nobel prize winners who said the whole economy lives in the short term found out that all of a sudden the short term has to come back to the long term.


Now, it’s amazing how today’s press doesn’t get it. For instance, in the New York Times Paul Krugman, who you can almost always depend to be wrong, said the problem is there’s a savings glut. People have too many savings. Well, we know that they don’t in America have too many savings. We’re in a debt deflation now. The 99 percent of the people are so busy paying off their debt that what is counted as savings here is just paying down the debt. That’s why they don’t have enough money to buy goods and services, and so sales are falling. That means that profits are falling. And people finally realize that wait a minute, with companies not making more profits they’re not going to be able to pay the dividends.


Well, companies themselves have been causing this crisis as much as speculators, because companies like Amazon, like Google, or Apple, especially, have been borrowing money to buy their own stock. And corporate activists, stockholder activists, have told these companies, we want you to put us on the board because we want you to borrow at 1 percent to buy your stock yielding 5 percent. You’ll get rich in no time. So all of these stock buybacks by Apple and by other companies at high prices, all of a sudden yes, they can make that money in the short term. But their net worth is all of a sudden plunging. And so we’re in a classic debt deflation.


PERIES: Michael, explain how buybacks are actually causing this. I don’t think ordinary people quite understand that.


HUDSON: Well, what they cause is the runup–companies are under pressure. The managers are paid according to how well they can make a stock price go up. And they think, why should we invest in long-term research and development or long-term developments when we can use the earnings we have just to buy our own stock, and that’ll push them up even without investing, without hiring, without producing more. We can make the stock go up by financial engineering. By using our earnings to buy [their own] stock.


So what you have is empty earnings. You’ve had stock prices going up without really corporate earnings going up. Although if you buy back your stock and you retire the shares, then earning the shares go up. And all of a sudden the whole world realizes that this is all financial engineering, doing it with mirrors, and it’s not real. There’s been no real gain in industrial profitability. There’s just been a diversion of corporate income into the financial markets instead of tangible new investment in hiring.http://www.nakedcapitalism.com/2015/08/michael-hudson-smoke-and-mirrors-of-corporate-buybacks-behind-the-market-crash.html

[pgardn]

And yet for the long haul the individual that plays makes far more money if well diversified.

You keep your money in Savings, you lose.

Look at almost any 15 year period and compare. We know there are people/institutions with an unfair advantage yet "we" must play. I challenge any poster to reveal the secret of a better investment than US stocks.

[Winehole23]

We know there are people/institutions with an unfair advantage yet "we" must play.Be that as it may, more than half of Americans don't, as of September of last year.


The Federal Reserve Survey of Consumer Finance found that only 48.8 percent of Americans held stock either directly or indirectly in 2012, the latest period measured. That's the lowest level since 1995, when 40.5 percent of Americans held some form of stock. (Indirect ownership of stock includes stocks held in mutual funds, 401-K plans and other investment vehicles.)

The survey said only 14 percent of Americans own stocks directly—down from 21 percent in 2001.


But even more than most assets in America, their ownership is highly skewed toward the wealthy. Fully 93 percent of the wealthiest 10 percent of Americans own stocks. That's nearly twice the level for the middle 50 percent and far more than the 26 percent stock-ownership rate for the bottom 40 percent.http://www.cnbc.com/2014/09/08/the-stock-gap-american-stock-holdings-at-18-year-low.html

[Bender]

And yet for the long haul the individual that plays makes far more money if well diversified.

You keep your money in Savings, you lose.

Look at almost any 15 year period and compare. We know there are people/institutions with an unfair advantage yet "we" must play. I challenge any poster to reveal the secret of a better investment than US stocks.


:tu

I've been investing in pipeline companies (MLPs) and MLP funds. they make their money transporting and moving NG and petroleum, and although the price fluctuates ("goes down") with oil & gas stocks, they still make their money and they have great dividend yields.

besides that, I'm generally very diversified.

been leaning towards Ginny Mae funds the past year or so. Hopefully a safe-haven in any market meltdowns.

Having all of your money in savings/CDs/MMs etc at near-zero interest rates.... no thanks, although I have the recommended 4-6 months income in them.

[The Reckoning]

And yet for the long haul the individual that plays makes far more money if well diversified.

You keep your money in Savings, you lose.

Look at almost any 15 year period and compare. We know there are people/institutions with an unfair advantage yet "we" must play. I challenge any poster to reveal the secret of a better investment than US stocks.


bonds and mutual funds are pretty good too. just have to keep diversifying your portfolio.

[pgardn]

bonds and mutual funds are pretty good too. just have to keep diversifying your portfolio.

Mutual funds have all sorts of stock/bond mixtures and are indeed the easiest way to diversify IMO.

[pgardn]

Be that as it may, more than half of Americans don't, as of September of last year.

http://www.cnbc.com/2014/09/08/the-stock-gap-american-stock-holdings-at-18-year-low.html

Most of my stock is thru mutual funds as it is so much easier to diversify this way.
I suggest Vanguard as it has very low fees and does not allow constant churning if one is in for the long haul.

It would also make sense that many in the U.S. who are not wealthier do not participate as they don't have money to. But if they work for a company that has some sort of pension then they do probably participate.

And I totally get why owning stock directly is down, this all correlates well with individuals entering via mutual funds exclusively.

[CosmicCowboy]

This is a TERRIBLE time to hold long bonds unless you are planning to collect them out. FED is gonna HAVE to start creeping rates back up and existing low interest bonds will take a shit in value.

[pgardn]

This is a TERRIBLE time to hold long bonds unless you are planning to collect them out. FED is gonna HAVE to start creeping rates back up and existing low interest bonds will take a shit in value.

It indeed is but bonds are not as volatile either unless they are junky. In stock you can take a one day pounding and some people can't handle that psychologically.

[spurraider21]

does booboo seriously think you can solve every problem by taxing it?

[m>s]

I feel sorry for people who think now is a good time to buy in

[pgardn]

I feel sorry for people who think now is a good time to buy in

So you are selling?

[m>s]

So you are selling?
Only thing I have out there is some money in retirement accounts and I've weighted it heavily toward bonds

[pgardn]

Only thing I have out there is some money in retirement accounts and I've weighted it heavily toward bonds

So you got out of stocks?

[m>s]

So you got out of stocks?
Not 100% but mostly yeah, I've been out for around a year. Hard to say when it was going to correct by now we are starting to see it. Pretty sure we are not done here.

[m>s]

Also do you know about the shemitah?

[Winehole23]

And I totally get why owning stock directly is down, this all correlates well with individuals entering via mutual funds exclusively.the non-institutional investor doesn't trust the market so much. he/she might not be wrong. historical patterns aren't destiny.

[CosmicCowboy]

I was half out two weeks ago. Only stock I held was one I was planning to keep to 2020+ anyway.

[Gordon Gekko]

Rough week for losers who panic. I'll make millions off them.

[pgardn]

the non-institutional investor doesn't trust the market so much. he/she might not be wrong. historical patterns aren't destiny.

Absolutely true.
But if someone mentions a better suggestion to invest long term than US stocks I would like to know.
There is risk in every investment.

[pgardn]

I was half out two weeks ago. Only stock I held was one I was planning to keep to 2020+ anyway.

I did absolutely nothing. But I don't try to time the market constantly and I have time.
The strength of my investing is realizing the U.S. is not in an immediate crisis with every event. 2007-08, when I bought heavily, was a lucky decision I guess as we did get a lot closer to a real mess than I realized.

My father killed it during the first Iraq conflict when the DOW was at 2100. I listened to his reasoning.

The next month and a half could be huge for me with a project. I have always wanted to teach, and even though I really like my job it may be time to quit and give something back to my fortunate situation.

You may all sing the National Anthem on 3. And uh 1...

[InRareForm]

I think Starbucks will be near the 100 mark in the next year or so to be honest

[vy65]

Ahem

[clambake]

don't worry. its some kind of dead cat bounce.