Discussion ***Official*** 2020 Stock Market Thread

[s0me0nesmind1]

No one is saying unemployment don't matter. It will eventually. Right now 2.4 trillion stimulus bailout and Fed money > unemployment numbers. To give you an idea how much 1 trillion dollar is, if you only stacked $100 bills, that stack of $100 Benjamins would go over 678 miles high into the air.

Consumer consuming > *

Right now - that's not happening.

Unemployment will make that lack of consumption permanent.

States that can't even keep up with unemployment benefits (Payouts, or applications).

That and unemployment checks will barely cover rent + lights + some food. That doesn't mean people out shopping for cars, clothes, toys, games, etc.

You're trusting OUR GOVERNMENT to keep up with the demand of our economy. They can't even distribute a $1200 stimulus check effectively for fucks sake.

Anyone who thinks unemployment doesnt matter either doesnt know how a consumer driven economy works or has had too much to drink..

The reason why the effect of the catastrophic unemployment number has been blunted is because everyone is on the dole for now, and we expect a reopened economy will provide jobs for those people when the time comes.

Without all the bailouts there would be anarchy and rioting in the streets and stocks we be at or near zero.

We would be Venezuela.

Edit: Also Chavezes extreme socialist agenda destroyed their economy coinciding with the collapse in oil. Their currency became worthless as a result and unless we dig ourselves out of debt one day the dollar too will also crash.

Viva Chavez!

This.

 

[s0me0nesmind1]

ooh nice

i should have a kid

As nice as 12 weeks of 100% pay is (16 weeks of 100% at my last job at an accounting firm)... It comes at a hefty price still. My kids are a 3yo and a 4 month old and I'm already pressured to sock away money in 529s for both of them =/

Best part though is laughing at the wife who gets meager 8 weeks of paid disability (@ 60% pay).... and women wonder why they get paid less than men in life lol. Wife has been at the same job since getting out of college, while I've had 4 employers.

 

[ponyo]

Consumer consuming > *

Right now - that's not happening.

Unemployment will make that lack of consumption permanent.

States that can't even keep up with unemployment benefits (Payouts, or applications).

That and unemployment checks will barely cover rent + lights + some food. That doesn't mean people out shopping for cars, clothes, toys, games, etc.

You're trusting OUR GOVERNMENT to keep up with the demand of our economy. They can't even distribute a $1200 stimulus check effectively for fucks sake.





This.

Your question was why isn't people shitting bricks right now when unemployment is so high. And my answer is market already priced that in for right now. And the market has told you that for 5 straight Thursdays in a row. What more proof do you want? You think you're the only one who sees 20%+ unemployment? Tell us something we don't know and we might care about your opinion.

So is the real economy and not the stock market in trouble? I believe yes. When do I think the real economy troubles will be reflected in the stock market? Probably late Q3 or early Q4. What does that tell you? Nothing. Because I could totally be wrong.

 

[WhoBeDaPlaya]

I used to watch CNBC for the female anchors. Erin Burnett and now Becky Quick. But I rarely watch TV now. I canceled cable TV like 10 years ago. Only reason I can still watch CNBC is because of my TD Ameritrade ThinkorSwim app. But I rarely watch it as I find it really distracting. I need to put it on very low volume or mute if I have it on.

No need, you can just watch Trump's daily briefings for Chanel Rion.
Dumber than a brick, but can still give you a stiffy

Will probably take a break from daytrading for a little while. While making some bank is nice (like IWM 5/1 $121Cs today), there's more to life than staring intently at a candle chart

 

[WhoBeDaPlaya]

No one is saying unemployment don't matter. It will eventually. Right now 2.4 trillion stimulus bailout and Fed money > unemployment numbers. To give you an idea how much 1 trillion dollar is, if you only stacked $100 bills, that stack of $100 Benjamins would go over 678 miles high into the air.

That's why we need $10,000 bills like Japan.
You know, like how I store 100TB of 4K VR pr0n on 7x14TB HDDs, instead of 100x1TB HDDs

 

[shortylickens]

i wonder what percent are posting on ATOT while they're supposed to be working

Not shorty.
Lost my job a while back. Contractors are not considered essential, especially when all we do is call out alarms.

 

[ponyo]

That's why we need $10,000 bills like Japan.
You know, like how I store 100TB of 4K VR pr0n on 7x14TB HDDs, instead of 100x1TB HDDs

VIX is down another ~11% today. Love days like today where I don't have to anything and I make money just from VIX going down

And that's picture of 10,000 Yen or about $93 US dollar. Our $100 bill is worth more.

 

[dasherHampton]

I don't know anything about WDC but Jan 2021 is longtime in the options world. Lot can happen 8 months. I'm all about cash covered puts, but I don't sell that far out. If I'm selling 8 months out, I want far higher max return than 13% for my cash. I want theta to work for me so I like selling weeklys and month or two out at most. Cash covered puts are still risky and you're tying up your cash capital. 13% max return is not enough reward given the outsized risk.

Couple of things:

1) You realize that 30 puts means covering shares at 25% less than they sit right now? The 40 puts are at $8.50 right now, over double where the 30 puts sit. I picked 30 puts become they're about as safe as it comes.

2) It's higher than a 13% annualized return.

3) You have to cover your options with cash? What level are you? Talk to your broker.

 

[ponyo]

Couple of things:

1) You realize that 30 puts means covering shares at 25% less than they sit right now? The 40 puts are at $8.50 right now, over double where the 30 puts sit. I picked 30 puts become they're about as safe as it comes.

2) It's higher than a 13% annualized return.

3) You have to cover your options with cash? What level are you? Talk to your broker.

You get paid with put premium. $10,000 / $75,000 is 13.33%. And that's for 8 months. I got paid over 22% on TSLA puts I sold with 2 months expiration.

And I only sell cash secured puts. If I don't have the cash to buy the assigned shares, I do not sell puts. Selling naked puts is dangerous. It's not about level. I can sell nake puts if I want. It's about risk control. You're playing with fire if you're selling puts which you can't cover with cash. Especially puts 8 months out. You're damn crazy and asking to go broke and owing money to your broker.

 

[WhoBeDaPlaya]

And that's picture of 10,000 Yen or about $93 US dollar. Our $100 bill is worth more.

Couldn't find a $10,000 picture in Google search. At least not without President Camacho on it!
Also, Jerome Powell might as well be black. Might just be Camacho's great, great grandfather

 

[dasherHampton]

You get paid with put premium. $10,000 / $75,000 is 13.33%. And that's for 8 months. I got paid over 22% on TSLA puts I sold with 2 months expiration.

And I only sell cash secured puts. If I don't have the cash to buy the assigned shares, I do not sell puts. Selling naked puts is dangerous. It's not about level. I can sell nake puts if I want. It's about risk control. You're playing with fire if you're selling puts which you can't cover with cash. Especially puts 8 months out. You're damn crazy and asking to go broke and owing money to your broker.

Unless I'm serverly mistaken that's not a naked option. The price on the shares is fixed at $30.

But no matter. We obviously disagree. I consider that about as safe of a 15%+ annualized return as you can get. The puts are 25% LESS than the current share price.

People seem to be happy to get 3% nowadays.

 

[ponyo]

Unless I'm serverly mistaken that's not a naked option. The price on the shares is fixed at $30.

But no matter. We obviously disagree. I consider that about as safe of a 15%+ annualized return as you can get. The puts are 25% LESS than the current share price.

People seem to be happy to get 3% nowadays.

https://www.investopedia.com/terms/n/nakedput.asp
It doesn't matter what it's called. Your max gain is the sold put premium. So $4.10. That's it. However, your potential loss is far greater. If you sell WDC $30 put and the stock falls to $20, then you're down $6 even after subtracting the $4 put premium you received. By selling put that far out in January, you're not letting theta work for you. You want to join the theta gang as it's very powerful tool. But theta is most powerful for options with less than month expiration. So you're leaving out your best friend and helper theta by buying Jan 2021 option.

Like I said, you want to set aside cash in your portfolio in case the stock gets assigned. Just because your broker lets you sell naked because you have level 2 option privilege which most broker will give to anyone who's breathing and has a pulse doesn't mean you shouldn't set aside the cash yourself. You should always exercise good risk control. Because your broker is always going to give you enough rope to hang yourself. You do not want to end up like this idiot who picked up pennies in front of steamroller and got run over and killed.

Granted, this fool sold OTM naked calls. But you can still lose big selling puts if the buyer decides to exercise and you don't have the money set aside to buy the stock. They don't have to wait til expiration and can exercise the put at anytime. So if WDC drops to $10 two months from now, you better have the money to buy at $30. Then you're screwed since WDC is trading at $10. You just lost way more than the put premium you received.

You're better off selling weekly and monthly puts if your goal is income generation. The options are more liquid so you get better buy/sell spread. And those weekly and monthly puts add up over time and you'll make more money than selling put 8 month out. But options are not free lunch. It's very dangerous selling calls and puts. I do it, but I'm aware of the high risk which is why I only sell cash secured puts and covered calls.

 

[WhoBeDaPlaya]

^ This. I treat "Sell to open" with the utmost caution, though watching someone else get thrashed by theta is fun.

On another note, technical analysis is a fine tool (I look at Fibonacci retracements, dark pool indicators (GEX/DEX), etc.) but it all goes out the window when a damn Tweet up and manipulates the market. That and the fed printer going brrrr.. in the background.

It's absolutely hilarious that I'll compile a solid TA bearish case these past ~2-3 weeks, and just say f*ck it, and buy calls (and profit) anyway!

 

[Svnla]

Clueless pigs get slaughter, badly.

Young investors rush into struggling oil ETF that isn't even tracking the price of oil anymore

Traders on Robinhood and SoFi Invest rushed to buy the United States Oil ETF, which crashed this week and has lost more than 80% of its value this year.

www.cnbc.com

 

[WhoBeDaPlaya]

Clueless pigs get slaughter, badly.

Young investors rush into struggling oil ETF that isn't even tracking the price of oil anymore

Traders on Robinhood and SoFi Invest rushed to buy the United States Oil ETF, which crashed this week and has lost more than 80% of its value this year.

www.cnbc.com

Novice investor + Robinhood = loss pr0n
Tons of it this week on r/wsb

https://www.reddit.com/r/wallstreetbets/comments/g77iwd

 

[dasherHampton]

I trade less on margin than I used to. I actually have no margin debt as of right now. But damn is it hard to make real money if you decide your never going to go into margin. When I was day trading full time I was always in margin. I think I paid $6000+ one month in interest.

I learned the hard way NEVER to use "sell to open" on options. It happened within about a year and 1/2 after I had started trading for real. Luckily it didn't cost me that much.

I would often designate my puts and calls Sunday evening just to be sure I got them in before open Monday morning. If I could I would usually would check them around 8:15-8:20 to make sure everything was in order. Anyway, I sold some weekly puts on something (I don't remember exactly what) for around $500.

At 8:15 the open order showed everything was ok so l left it alone. At around 9 I checked again. For some reason my account balance looked off so I dug a bit. Sure enough: The puts had opened at ZERO. I was like "What the F%^K?". I had given them away.

I even called the brokerage to have the look at it. The people I talked to were all perplexed and couldn't explain it. I eventually got a letter from them explaining that "Options are volatile". Ya think?

iirc The puts expired unexercised, so my only loss was that $500. But never again. That taught me more than $500 spent at any business school.

 

[WhoBeDaPlaya]

Summary of the trading week / economic data :

 

[FelixDeCat]

That's why we need $10,000 bills like Japan.
You know, like how I store 100TB of 4K VR pr0n on 7x14TB HDDs, instead of 100x1TB HDDs

Pfft. Try this one on for size:



Hyerinflation hit Zimbabwe so they eventually had to print a $100 Trillion Dollar note worth about .40 cents. Fiat currency and printing money by issuing debt that will not be repaid is a fools game that leads to a dead end.

Do you honestly believe America will repay $30,000,000,000,000? For that to happen we would have to cut government spending to the bone by eliminating defense spending, cutting entitlements drastically and raise taxes as high as possible - then apply the excess to debt repayment. That would hurt our precious stock market and economy, and we cant have that!

America has no appetite to pay the bill. We are doomed to our fate.

 

[JEDI]

Pfft. Try this one on for size:

View attachment 20121

Hyerinflation hit Zimbabwe so they eventually had to print a $100 Trillion Dollar note worth about .40 cents. Fiat currency and printing money by issuing debt that will not be repaid is a fools game that leads to a dead end.

Do you honestly believe America will repay $30,000,000,000,000? For that to happen we would have to cut government spending to the bone by eliminating defense spending, cutting entitlements drastically and raise taxes as high as possible - then apply the excess to debt repayment. That would hurt our precious stock market and economy, and we cant have that!

America has no appetite to pay the bill. We are doomed to our fate.

so why isnt inflation in the US shooting up like Zimbabwe?

 

[FelixDeCat]

so why isnt inflation in the US shooting up like Zimbabwe?

For now we are catching a break. How long it lasts, nobody knows.

That question has been asked for years now. You have two camps - the "percent of GDP" and "relative to other country's debt" crowd who think we can borrow until we default because they will always make excuses for our bad behavior. Then you have people like billionaire Ray Dalio who has been preaching and converting crowds warning that the world is in a debt spiral.

As long as the world believes we can make just interest only debt payments they will keep faith in our currency. If other nations follow our lead and keep things relative - ditto.

But our taxes are too low, our spending and borrowing is too high and we worship at the feet of an inflated stock market.

I remember runaway inflation of the 1970s. I remember the Fed jacking up rates to 20% to reign it in. Thats when the Fed had BALLS!

Now we are just a bunch of crybabies, always looking for a handout and a free lunch.

 

[brianmanahan]

But our taxes are too low

bingo

either income's gotta go up to compensate for more spending, or the spendings gotta go down to compensate for less income

i don't get why they seem to have such a disconnect

 

[ponyo]

I bought this bolivar purse for my wife last year when we visited Bogota, Colombia, in part because I thought it was pretty cool and also as a reminder what can happen to any currency. I think I paid like $12 or so to two Venezuelan girls who were making and selling handbags and wallets made from Venezuelan bolivar. It's also why I started buying gold, silver, and platinum because I was concerned with long term impact of our and world debt. It's also why I now want to buy some Bitcoin to hold. You never know when your small insurance might payoff in 10 or 20 years down the line. Like any insurance, you hope you never have to use it. But if you do, it can be a lifesaver. Nice thing about gold and Bitcoin is once you buy it, there's no monthly or annual premium you gotta keep paying to keep your insurance. It's yours forever and all you have to do is store it.

 

[brianmanahan]

Nice thing about gold and Bitcoin is once you buy it, there's no monthly or annual premium you gotta keep paying to keep your insurance. It's yours forever and all you have to do is store it.

as you get more gold though, it becomes more necessary to ensure adequate protection

i wouldn't want to buy a lot of it until i get my own house. and the house would need either a very good hiding spot for the gold, or a very unmoveable safe

 

[ponyo]

as you get more gold though, it becomes more necessary to ensure adequate protection

i wouldn't want to buy a lot of it until i get my own house. and the house would need either a very good hiding spot for the gold, or a very unmoveable safe

Nonsense. Bank safe deposit box is large enough to store more gold than you can afford. Even if you kept it at your house, gold is small enough and easily hidden that I could hide it in my house and let you search it for a year and you still wouldn't find it. You can store gold practically anywhere because it's so small and compact.

 

[brianmanahan]

Nonsense. Bank safe deposit box is large enough to store more gold than you can afford. Even if you kept it at your house, gold is small enough and easily hidden that I could hide it in my house and let you search it for a year and you still wouldn't find it. You can store gold practically anywhere because it's so small and compact.

safe deposit is an option but those things always scare me, i dunno why. i feel like i'd get mugged on the way to the bank or on the way back.

and my memory's so bad that if i hid it in my house, i'd probably eventually forget that i even owned it

of course then someone might find it in 2500 years, like lydians who left behind their staters when fleeing the persians... that would be pretty sweet.