Stock Market Watch, President-Elect Trump

[zap]

Originally Posted by Look585

<rant>

"Labor Force Participation Rate" gets tossed around way too often (usually with political overtones) and very few people even know how it is calculated. Lower is not necessarily bad, higher not necessarily good.

Two examples:

1) If old people are living longer in retirement, labor force participation rate goes down (ceteris paribus) as retirees (not in an assisted living facility) count as part of the labor force but aren't participating. Is that a good or bad thing?

2) If more young people are in school, labor force participation rate goes down (again, ceteris paribus) as students (16 and over) count as part of the labor force but aren't participating. Is that a good or bad thing?

Lies, damn lies, statistics...

</rant>

Economists look at labor participation rates as it affects growth. Whats interesting is that the participation rate in the US among prime age (25-54) workers has also fallen, down around 2% since the start of the last recession.

[tigoat]

I am losing my butt right now. Was short late last year and then went long for the Santa Clause and New Year rally, which didn't happen. AAPL and TWTR are big killers right now.

[fiamme red]

I just had the courage to look at my 401(k). I think I'll have to add five years to my projected retirement date.

[Steelman]

The "TSX" Toronto Stock Exchange is down 20% from its high in 2014. The Canadian dollar is trading at 70cents US, a level not seen since 2003.

If you have US dollars, I would consider shopping north of the border, especially when there is an indication that oil is recovering.

[Steelman]

Originally Posted by tigoat

I am losing my butt right now. Was short late last year and then went long for the Santa Clause and New Year rally, which didn't happen. AAPL and TWTR are big killers right now.

I'm discouraged by Apple too, but the valuation is reasonable, and they have billions in cash. That is without taking into account what products/technologies are coming.

People are selling their winners, looking for a source of cash. When the correction is over, like last time, people will be scrambling to get back in to AAPL.

[rounder]

When I was in graduate school in the mid-80s, people thought that DOW at 2,000 was the magic number. That was before the internet and so long ago.
l

[verticaldoug]

Originally Posted by Steelman

I'm discouraged by Apple too, but the valuation is reasonable, and they have billions in cash. That is without taking into account what products/technologies are coming.

People are selling their winners, looking for a source of cash. When the correction is over, like last time, people will be scrambling to get back in to AAPL.

Apple is basically a one product company- Iphone. 70% of revenues and an even higher percentage of profits is driven by this product. The ramp of rumors and buildout for Iphone7 will start this summer, and ultimately decide the direction of the stock price.

[MattTuck]

Originally Posted by Tony T

So, you think the Fed will step-in and say that ' about that 1% rate increase in 2016 "never mind" '

"Don't fight the Fed", last meeting was not a "one and done" rate increase. When the Fed starts to raise rates, they continue to raise rates. Look for 4 more increases in 2016 (which will still only get us just above 1％)

Good news is that gas is now below $2

Tony, Over the last couple weeks, I believe the rate has dropped below the fed's target on multiple occasions, and by not insignificant amounts. Unwinding this situation is not as simple as just pulling a comically large lever on the wall at the Fed. The chain of linkages to get the rates to raise in the market is not perfect, and honestly, not full understood after all the crazy stuff they've done in the last 8 years (reverse repos, and all sorts of weird stuff to mess with bank reserves) and a weak economy is going to pressure rates lower, not higher.

Also, this past week, the probability of a January rate CUT is higher than before the rate hike. I'm not saying there will be a rate cut, I'm saying that the Fed has gotten itself in a pickle, and its playing out in the capital markets and the real economy in ways that no one really can fully predict; because so much of the Fed's actions were unprecedented.

[happycampyer]

Originally Posted by MattTuck

Tony, Over the last couple weeks, I believe the rate has dropped below the fed's target on multiple occasions, and by not insignificant amounts. Unwinding this situation is not as simple as just pulling a comically large lever on the wall at the Fed. The chain of linkages to get the rates to raise in the market is not perfect, and honestly, not full understood after all the crazy stuff they've done in the last 8 years (reverse repos, and all sorts of weird stuff to mess with bank reserves) and a weak economy is going to pressure rates lower, not higher.

Also, this past week, the probability of a January rate CUT is higher than before the rate hike. I'm not saying there will be a rate cut, I'm saying that the Fed has gotten itself in a pickle, and its playing out in the capital markets and the real economy in ways that no one really can fully predict; because so much of the Fed's actions were unprecedented.

An apt analogy I read recently is that the Fed is like a cat up a tree--it was much easier getting up than it will be getting down. The massive misallocation of capital that has taken place over the last six or seven years is starting to reverse itself (it's surprising that it has taken so long since QE3 ended). And with wild cards like the Saudis continuing to contribute to a glut in oil, the Chinese regulators destroying credibility in their financial markets, tensions in the Middle East, Korea, etc. it's going to be a very bumpy ride.

[oldpotatoe]

Originally Posted by fiamme red

I just had the courage to look at my 401(k). I think I'll have to add five years to my projected retirement date.

And in 5 years you will be saying you'll get the retire 5 years earlier.

[Tony T]

..or not

[saab2000]

Originally Posted by fiamme red

I just had the courage to look at my 401(k). I think I'll have to add five years to my projected retirement date.

Or we could have a killer week and your estimate comes down. These things fluctuate.

[jlwdm]

I saw an article on yahoo finance the other day that I recall said the average stock in the s&p 500 is down over 20% from its high in the last year.

It is a weighted average and a small number of companies make up a lot of value.

Jeff

[PFSLABD]

Originally Posted by likebikes

Down 1000 points this week.

It's like a downhill bike ride. What goes down, inevitably goes back up, again.

[laupsi]

Investing and saving should be very simple. One of the first rules in personal ifinance is to make time work for you, the second is to minimize risk. Dollar cost averaging is not complicated and if done early in one's working life, is a very successful means to a comfortable outcome. Regardless of the economic conditions, save/invest often and consistently. And if at all possible start early.

Don't make it complicated!