***Official*** 2019 Stock Market Thread

[JEDI]

Fed meets on Wednesday... double cut probability is currently 21%.

Fed meets on Wednesday... double cut probability is currently 21%.

cutting the fed rate is stupid when the econ is good.
wtf?!

 

[jpiniero]

cutting the fed rate is stupid when the econ is good.
wtf?!

Because the stock market will crash if they don't. As I've mentioned.

 

[Charmonium]

The Fed is probably expecting a recession in 12-18 months. If that's the case, they want to lean into it by keeping liquidity high.

Cheap money creates more demand for corp finance - borrowing. That's because when rates are low, you have more potential projects that you can make money on.

If their/my time frame is correct, any monetary stimulus has to start in the foreseeable future - 0-6 months.

 

[FelixDeCat]

My prediction - .25 only with dovish outlook

 

[FelixDeCat]

Because the stock market will crash if they don't. As I've mentioned.

The fed is not responsible for keeping the stock market at elevated levels, especially when the market throws temper tantrums over temporary concerns.

Excluding late last year when the market fell nearly 20% from its high only to recover and reach new all time highs again when the Fed stop tightening, a lot of the drama has been taken out of daily market gyrations since pre-programmed robotic algorithms do most of the technical trading.

Now people get paid to sit on the sidelines, answer for the algos trading and tell people not to sell when the market goes down. I miss the good ol' days.

 

[jpiniero]

Cheap money creates more demand for corp finance - borrowing. That's because when rates are low, you have more potential projects that you can make money on.

Companies aren't borrowing to expand - they are borrowing to do stock buybacks to prop up the price temporarily. What I think happened in December is that companies stopped the buybacks until the Fed promised to stop raising, and then cut rates.

I'm not convinced a stock market crash would mean a recession (because the market is so screwed up) but the Fed clearly disagrees.

 

[Charmonium]

Companies aren't borrowing to expand - they are borrowing to do stock buybacks to prop up the price temporarily. What I think happened in December is that companies stopped the buybacks until the Fed promised to stop raising, and then cut rates.

I'm not convinced a stock market crash would mean a recession (because the market is so screwed up) but the Fed clearly disagrees.

I never know how much detail to go into so I tend to gloss over things.

I shouldn't have implied that businesses would NECESSARILY expand with lower rates. My point was that at any given moment, any business has a list of potential projects that have to be financed if they're to be realized.

For each project, there's going to be an expected break even point where the return on the project is equal to the cost of financing it. So the lower the cost of capital, the more potential projects are financially viable.

If that's what the fed is doing, this SHOULD help to stimulate economic growth. But there are always other parameters that can push in the opposite direction. For example, as the economy starts to contract into a recession there might not be enough economic activity to make all of your potential projects feasible.

 

[jpiniero]

Ha, Wall Street is mad they didn't get the double cut.

 

[FelixDeCat]

Ha, Wall Street is mad they didn't get the double cut.

It did not need one. Thats how the opioid epidemic got started. Give them pain killers without any need. Give them rate cuts without any need.

Brilliant!

 

[KB]

Ha, Wall Street is mad they didn't get the double cut.

Its typical market behavior, buy on the rumor, sell on the news.

 

[IronWing]

The Fed is playing pattycake with the Trump admin and stock market now. "Trump's about to do something stupid that will tank the market. Quick, here's a completely unwarranted rate cut."

 

[Ken g6]

Well, Trump tanked the market again. I wonder if there's a pattern to this? I've been auto-investing around the second of the month for awhile now, and it seems like the market always tanks just before or around that time.

 

[s0me0nesmind1]

Well, Trump tanked the market again. I wonder if there's a pattern to this? I've been auto-investing around the second of the month for awhile now, and it seems like the market always tanks just before or around that time.

Yeah I should really switch from doing it at the end of month haha.

Come to think of it though, I might start tapering down my investments in general. I can't see much reason for the general market to go up much over the course of the remaining of this year at minimal.

 

[FelixDeCat]

Well, Trump tanked the market again. I wonder if there's a pattern to this? I've been auto-investing around the second of the month for awhile now, and it seems like the market always tanks just before or around that time.

Let me know when your next bucket goes into autoinvest. I will buy some cheap weekly puts on the QQQs.

 

[dasherHampton]

Did you AMD holders get out? Or are you in for the long haul?

 

[s0me0nesmind1]

Did you AMD holders get out? Or are you in for the long haul?

I did right before it turned to $30. Last I saw it was up to over $34 but recently went down a bit after earnings.

AFAIK @zinfamous still has his.

 

[zinfamous]

It got up to $34.87 ~last week, and so never triggered my $35 sell order on half shares. Came so close....I'll be fine though, this is that annual hiccup.

It seems more than predictable these days: AMD has a fairly decent earnings report, owners panic. ...and it was actually recovering quite decently throughout yesterday, until that weird thing happened at ~330pm or whenever and it lost another 10% or whatever. ...then I learned that was Trump doing his dumbshit again. Seriously, SEC needs to arrest that motherfucker for all this repeated market manipulation that his tweet fingers command. Honestly seems like a buying opportunity, though.

 

[s0me0nesmind1]

It got up to $34.87 ~last week, and so never triggered my $35 sell order on half shares. Came so close....I'll be fine though, this is that annual hiccup.

It seems more than predictable these days: AMD has a fairly decent earnings report, owners panic. ...and it was actually recovering quite decently throughout yesterday, until that weird thing happened at ~330pm or whenever and it lost another 10% or whatever. ...then I learned that was Trump doing his dumbshit again. Seriously, SEC needs to arrest that motherfucker for all this repeated market manipulation that his tweet fingers command. Honestly seems like a buying opportunity, though.

Yeah I really don't understand these AMD ups and downs. There is really no reason for it because it seems like they are on solid footing and ahead of intel. All the publicity I have seen from them lately has been nothing but positive.

Fucking silly to drop that substantially after meeting expected earnings.. They did... what they anticipated/expected... And that equals a 15% drop? Stupid.

 

[zinfamous]

Yeah I really don't understand these AMD ups and downs. There is really no reason for it because it seems like they are on solid footing and ahead of intel. All the publicity I have seen from them lately has been nothing but positive.

Fucking silly to drop that substantially after meeting expected earnings.. They did... what they anticipated/expected... And that equals a 15% drop? Stupid.

well, their P/E is still absurdly high at something like 127? They are definitely crushing Intel in the desktop space, performance, sales, and marketshare over the last 5 months of so, but that is also the smallest market that they compete in.

AMD still sucks in addressing OEM/Laptop space with solid APUs to compete with Intel. ....but if the Google rumor is true that they are in part, or wholly dumping Intel for their cloud/server solutions, then that is a very big deal. ...very big. AMD still also has to prove that they can supply the vendors and OEMs like Intel has historically been able to do.

 

[s0me0nesmind1]

well, their P/E is still absurdly high at something like 127? They are definitely crushing Intel in the desktop space, performance, sales, and marketshare over the last 5 months of so, but that is also the smallest market that they compete in.

AMD still sucks in addressing OEM/Laptop space with solid APUs to compete with Intel. ....but if the Google rumor is true that they are in part, or wholly dumping Intel for their cloud/server solutions, then that is a very big deal. ...very big. AMD still also has to prove that they can supply the vendors and OEMs like Intel has historically been able to do.

I often wonder how sales like that go.... Does AMD just pop-in and say "heeeeeey Google, want to change processors?" or does Google go do an RFP for new parts all the time or something?

I mean, unless their sales suck - why even change processors? The cost to change probably isn't easy because you will likely have to change other hardware (at least the mobo) with it.

I probably only ask that question now since I work in sales related to technical software that requires lots of implementation costs....

 

[zinfamous]

I often wonder how sales like that go.... Does AMD just pop-in and say "heeeeeey Google, want to change processors?" or does Google go do an RFP for new parts all the time or something?

I mean, unless their sales suck - why even change processors? The cost to change probably isn't easy because you will likely have to change other hardware (at least the mobo) with it.

I probably only ask that question now since I work in sales related to technical software that requires lots of implementation costs....

well with Intel, you have to change the Mobo every single generation anyway (well, every update, actually), so it's not like companies aren't already used to that. I do think the salesfolks have established relationships with and/or just do their rounds with the system admins--either info bombing them or scheduling time with them to go over the upcoming options. I'm sure they know the needs of each company they plan to do business with, and these days AMD can bring to them some insane cost savings in power, hardware replacement, all the while dramatically improving performance and overall efficiency. Even so, Intel always has that mind share and it's a tough nut. I'm sure there's a cost in something like completely swapping out Intel for AMD, or the other way around, and that sort of time and $$$ may not be worth the data presented on paper.

I think that stuff takes a long time to set up, and you're planning to buy for a year or later down the line, on top of generally needing to replace hardware daily, anyway. Hell, we have people here that no exactly how this works. I know I don't.

 

[Ken g6]

Let me know when your next bucket goes into autoinvest. I will buy some cheap weekly puts on the QQQs.

I don't know what that means. I just mean my monthly IRA contribution is set for the first of the month, and usually takes 24 hours to complete.

 

[jpiniero]

well, their P/E is still absurdly high at something like 127? They are definitely crushing Intel in the desktop space, performance, sales, and marketshare over the last 5 months of so, but that is also the smallest market that they compete in.

Uh, no. Intel made 2.7B last quarter just on desktop alone, AMD made 940M on all of Computing and Graphics. How much of that 940M was desktop, can't say since AMD doesn't give that kind of granularity. Which is kind of annoying but within SEC rules.

One big problem is that the console sales are slumping. Not surprising given how late in the cycle it is, but it's doing worse than expected. The Switch is not helping of course.

As for Google, they don't have to completely dump Intel. Just buy less Xeons and more Rome than they are now.

 

[zinfamous]

Uh, no. Intel made 2.7B last quarter just on desktop alone, AMD made 940M on all of Computing and Graphics. How much of that 940M was desktop, can't say since AMD doesn't give that kind of granularity. Which is kind of annoying but within SEC rules.

One big problem is that the console sales are slumping. Not surprising given how late in the cycle it is, but it's doing worse than expected. The Switch is not helping of course.

As for Google, they don't have to completely dump Intel. Just buy less Xeons and more Rome than they are now.

I think maybe it's a margin issue? that one marketshare/revenue chart showed AMD in the 72% and 74% for each, respectively. They sold more units in desktop, by far, and represented far more (gross) $$$ in sales, but the margins were lower, no? That's how I understood it.

AMD is still shedding the last piece of debt from Mabudallah which, I think, will probably be a memory before this year ends...which is staggering when you think about. The 99% of all that smart people in the world decried that this is the thing that would kill them. Anyway, I think they've offset all of these various expenses into their reports, such that all targets are actually met and, the headwinds that the entire semi industry has predicted, now effects them, but probably not as much considering their now-established advantages.

 

[jpiniero]

I think maybe it's a margin issue? that one marketshare/revenue chart showed AMD in the 72% and 74% for each, respectively. They sold more units in desktop, by far, and represented far more (gross) $$$ in sales, but the margins were lower, no? That's how I understood it.

Any marketshare charts you've seen on the net is just DIY, which is a small part of desktop sales. Given that AMD doesn't give out specific desktop #'s it's hard to say how much revenue is actually increasing there. I think Wall Street is dissapointed they aren't doing better, especially given Intel's troubles.