Discussion ***Official*** 2022 Stock Market Thread

[AdamK47]

Markets are taking it fairly well. Was expecting a bigger drop. Only hit one of my limits.

 

[jpiniero]

Full point hike is now the slight favorite.

 

[FelixDeCat]

And the Market goes up.

Lol at shorts?

 

[Lost_in_the_HTTP]

Well, the marketeers were whining about inflation, now they want to whine about steps to deflate it. What exactly DO they want?

 

[dullard]

Well, the marketeers were whining about inflation, now they want to whine about steps to deflate it. What exactly DO they want?

A different government.

 

[jpiniero]

Ouch JP Morgan. That alone should make it a pretty big red day.

 

[dullard]

Ouch JP Morgan. That alone should make it a pretty big red day.

That reminded me of this post:

If you guys haven't been already, the banks are the place to be. I am in USB, WFC, C, JPM et al.

Banks really do not do well when interest rates rise.

 

[AdamK47]

Pinterest stock exploding in after market.

I still don't understand the purpose or appeal of Pinterest. I guess I'm just not cool enough to understand.

 

[jpiniero]

Going to be a pretty green day, which I find baffling. Does Wall Street think the Fed is going to turn the money printer back on that soon?

Ethereum is also getting close to $1500.

 

[KB]

Going to be a pretty green day, which I find baffling. Does Wall Street think the Fed is going to turn the money printer back on that soon?

Ethereum is also getting close to $1500.

They think the interest rate rises we will be slower. The market priced in a decent recession and huge interest rate rises, so anything less than that would be good.

 

[AdamK47]

They think the interest rate rises we will be slower. The market priced in a decent recession and huge interest rate rises, so anything less than that would be good.

That's pretty much what I thought.

Market pricing in a recession and the fed being cautious on interest rate hikes.

 

[KB]

That reminded me of this post:

Banks really do not do well when interest rates rise.

They definately can. As interest rates rise, Net interest margin goes up. Thats the difference between the interest rate they pay on savings accounts ~0.2% and the interest rate they charge on loans ~5.5%. The banks are being hit by dropping mortage refinancing income and lower bond sales, but those too will recover and the banks will do well as long as housing sales return at these interest rates.

JPM got hit pretty hard because they are being prudent and increased their loan loss reserves, which show up as a loss in EPS and they quit their buy backs to increase capital as a result of the Fed stress tests.

 

[jpiniero]

They think the interest rate rises we will be slower. The market priced in a decent recession and huge interest rate rises, so anything less than that would be good.

A recession would be good for stocks because that would give the Fed an excuse to turn the money printer back on. Maybe that's it but the rate hike odds velocity has dropped only slightly.

I doubt that 3% would be enough to curb inflation even with a recession and only a short period before they cut it back to 0 probably wouldn't be enough time to scare people into RTO.

 

[AdamK47]

A recession would be good for stocks because that would give the Fed an excuse to turn the money printer back on. Maybe that's it but the rate hike odds velocity has dropped only slightly.

I doubt that 3% would be enough to curb inflation even with a recession and only a short period before they cut it back to 0 probably wouldn't be enough time to scare people into RTO.

That will only exacerbate the problem they are trying to fight.

 

[FelixDeCat]

A recession would be good for stocks because that would give the Fed an excuse to turn the money printer back on. Maybe that's it but the rate hike odds velocity has dropped only slightly.

I doubt that 3% would be enough to curb inflation even with a recession and only a short period before they cut it back to 0 probably wouldn't be enough time to scare people into RTO.

Damn the torpedoes. We need 10% mortgage rates now.

 

[AdamK47]

Damn the torpedoes. We need 10% mortgage rates now.

~16% was the mortgage interest rate in '81. The same year my parents bought the house I grew up in.

 

[AdamK47]

Goldman Sachs, Bank of America, Tesla, Google, and now Apple are announcing a hiring slowdown. More will follow. We'll work our way to hiring freezes and then ultimately layoffs.

Real signs of a recession.

 

[FelixDeCat]

Down she goes!

 

[FelixDeCat]

Down she goes!

And back up it goes. Looks like they are ignoring higher rates in favor of acceptable earnings.

 

[dank69]

Which one of you was this?

https://twitter.com/x/status/1549006056629706752

 

[AdamK47]

It's like yesterday never happened.

 

[jpiniero]

Maybe I should post this in the Rona thread, but housing is absolutely farved.

Phoenix - average SFH 490k
Dallas - 540k
Atlanta - 550k
Orlando - 420k
New Orleans - 423k

OK so those aren't Bay Area numbers. But the average HHI in New Orleans is 43k. WTF are the hedgies going to do with all that real estate? Someone with a 40k income isn't going to be making a $3k rent payment.

 

[jpiniero]

7 days to go and the odds have gone back down to a triple hike. But still the velocity is still sitting around 3.5-3.75.

The market is acting like the Fed will say they will start cutting soon. I am skeptical.

 

[FelixDeCat]

Looks like the bull is back.

 

[FelixDeCat]

Which one of you was this?

https://twitter.com/x/status/1549006056629706752

Lol...is that for real? 😳