I like this little article. Bullish or Bearish, Long-Term Forecasting Is a Folly What will stocks do in the next several years? You can’t know now. https://www.fisherinvestments.com/e...h-or-bearish-longterm-forecasting-is-a-folly# (BOLD is my opinion OR what I consider important content) "The S&P 500 is clocking round numbers and record highs, corporate earnings are growing, and there is ample talk of a pro-business White House adding tailwinds for years—buy! So say some. But every action has an equal and opposite reaction, so of course there is also a loud chorus saying valuations are too high and returns for the next several years will be weak. Who is right? In our view, none of them. We are bullish for now, but long-term forecasts are a fool’s errand. Beware. Whether bullish or bearish, none of the factors people cite can help you predict where stocks will go over the next 5, 10 or more years. Stocks, like all assets, move on supply and demand. Forecasting stocks in the long run therefore requires knowing how stock supply will evolve, which is impossible. A multitude of factors affects business creation, not to mention the decisions to go public, conduct stock-based mergers, buy back shares and accept buyouts or otherwise go private. It depends not just on regulations and the political backdrop, but also the economic environment (which is a lot less influenced by politics than either major US party claims), the principals’ appetite for risk taking, market sentiment and so much more. Demand, too, is difficult to pin down beyond the next 30 months or so. And none of the factors people cite now have a repeat, predictable effect on it. Tax cuts and other supposedly pro-business policies? Nice in theory, but not uniformly bullish. If hopes get too high and the changes are smaller than expected, disappointment may reign. If changes pass narrowly, it could simply extend uncertainty, courtesy of the prospect that a future Congress could just change things back. Ping, pong, flip, flop, stocks don’t like such uncertainty. Similarly, with valuations—whether traditional price-to-earnings ratios or the cyclically adjusted version (price versus 10 years of inflation-adjusted earnings)—it seems logical to presume high means “pricey” and “sure to drop or disappoint.” But market history is rife with examples of seemingly pricey stocks and indexes getting even more expensive as investors become ever-more willing to pay more for future profits. We also have myriad examples of stocks getting less “expensive” even as share prices keep rising, thanks to growing earnings. We also have the inverse, where cheap stocks keep getting cheaper. It is a hodge podge and yields only one logical conclusion: Valuations aren’t a timing tool. Not in the short run. Not in the longer term. Even knowing which of these camps is right about the next several years wouldn’t help you now. Stocks are cyclical. There are bull markets and bear markets (deep, long declines of -20% or worse, typically with fundamental causes). One forecast making the rounds Monday morning envisioned the S&P 500 price index hitting 10,000 by yearend 2030 (it hit 6,000 today, making this a forecast for a 66.7% price return in the next 5 or 6 years). Sounds nice! But it is entirely possible the index could get there with a nasty bear market striking at some point within the window. Or, if the weak-returns crowd is right, it could very well be because a bear market struck at the exact wrong/right time to make 10-year returns look meh. In both cases, we would have good years and bad years. None of the rhetoric or tools in headlines now tell you when the good and bad years will strike. Don’t get us wrong. Long-term returns matter. They are why we all invest! But the long endeavor of investing is all about navigating the ups and downs along the way. In a decade with lean cumulative returns, that means maximizing the likelihood of participating in the bull markets along the way and not letting the bad times dissuade you from trying to reap the good. And in a decade with strong cumulative returns, investing is all about … maximizing the likelihood of participating in the bull markets along the way and not letting the bad times dissuade you from trying to reap the good. Same thing! Bull markets and bear markets. Ultimately, what matters most for investors is the cumulative return over their entire time horizon and whether it is sufficient to meet their goals. For most folks, that means their entire life expectancy—plus more if the assets are also meant for a spouse, heirs or charitable bequest. Returns over a short window within this long stretch are largely arbitrary. Take any investor’s portfolio over 20, 30 years or more, and you can probably cherry-pick a 10-year run with subpar cumulative returns and a great six-year window. They may even overlap, if you have brutal two-year bear markets sandwiching a stellar six-year bull market. We get that sequencing matters to folks taking cash flows and to those with short time horizons, so we won’t write this all off as trivia. But in the grand scheme of things, the impossibility of forecasting far-future returns means it comes quite close." MY COMMENT Anyone that has been investing for ten years or more knows the above is true. We all have expectations and thoughts about where the markets are going. BUT.....how often do our predictions come true? There is no way to anticipate what the markets are going to do and why. there are just way too many factors that come into play......and....most of those factors are impossible to know in advance. So.....that is why I simply stay invested all the time. ALSO....due to the FACT that the SP500 will be positive any one year at least 70% of the time. i do trust and invest according to the academic research and what it shows about various investor behaviors and.......PROBABILITY.
Well we got the CPI and PPI out of the way this week as well as some jobs data. GOOD. I dont want this sort of stuff to engulf and detract from the NVDA earnings next week. We have seen way too many great earnings this time around made irrelevant by events and news items and guidance. It is a total WASTE of good earnings when this happens. US wholesale inflation picks up slightly in sign that some price pressures remain elevated https://finance.yahoo.com/news/us-wholesale-inflation-picks-slightly-134034716.html (BOLD is my opinion OR what I consider important content) "WASHINGTON (AP) — Wholesale prices in the United States rose last month, remaining low but suggesting that the American economy has yet to completely vanquish inflationary pressure. Thursday's report from the Labor Department showed that its producer price index — which tracks inflation before it hits consumers — rose 0.2% from September to October, up from a 0.1% gain the month before. Compared with a year earlier, wholesale prices were up 2.4%, accelerating from a year-over-year gain of 1.9% in September. A 0.3% increase in services prices drove the October increase. Wholesale goods prices edged up 0.1% after falling the previous two months. Excluding food and energy prices, which tend to bounce around from month to month, so-called core wholesale prices rose 0.3 from September and 3.1% from a year earlier. The readings were about what economists had expected. Since peaking in mid-2022, inflation has fallen more or less steadily. But average prices are still nearly 20% higher than they were three years ago — a persistent source of public exasperation that led to Donald Trump's defeat of Vice President Kamala Harris in last week's presidential election and the return of Senate control to Republicans. The October report on producer prices comes a day after the Labor Department reported that consumer prices rose 2.6% last month from a year earlier, a sign that inflation at the consumer level might be leveling off after having slowed in September to its slowest pace since 2021. Most economists, though, say they think inflation will eventually resume its slowdown. Inflation has been moving toward the Federal Reserve’s 2% year-over-year target, and the central bank’s inflation fighters have been satisfied enough with the improvement to cut their benchmark interest rate twice since September — a reversal in policy after they raised rates 11 times in 2022 and 2023. Trump’s election victory has raised doubts about the future path of inflation and whether the Fed will continue to cut rates. In September, the Fed all but declared victory over inflation and slashed its benchmark interest rate by an unusually steep half-percentage point, its first rate cut since March 2020, when the pandemic was hammering the economy. Last week, the central bank announced a second rate cut, a more typical quarter-point reduction. Though Trump has vowed to force prices down, in part by encouraging oil and gas drilling, some of his other campaign vows — to impose massive taxes on imports and to deport millions of immigrants working illegally in the United States — are seen as inflationary by mainstream economists. Still, Wall Street traders see an 82% likelihood of a third rate cut when the Fed next meets in December, according to the CME FedWatch tool. The producer price index released Thursday can offer an early look at where consumer inflation might be headed. Economists also watch it because some of its components, notably healthcare and financial services, flow into the Fed’s preferred inflation gauge — the personal consumption expenditures, or PCE, index. Stephen Brown at Capital Economics wrote in a commentary that higher wholesale airfares, investment fees and healthcare prices in October would push core PCE prices higher than the Fed would like to see. But he said the increase wouldn’t be enough “to justify a pause (in rate cuts) by the Fed at its next meeting in December.″ Inflation began surging in 2021 as the economy accelerated with surprising speed out of the pandemic recession, causing severe shortages of goods and labor. The Fed raised its benchmark interest rate 11 times in 2022 and 2023 to a 23-year high. The resulting much higher borrowing costs were expected to tip the United States into recession. It didn’t happen. The economy kept growing, and employers kept hiring. And, for the most part, inflation has kept slowing." MY COMMENT AND.......here is the other economic news today....not that this sort of short term data matters. US weekly jobless claims fall; unemployment rolls shrink https://finance.yahoo.com/news/us-weekly-jobless-claims-fall-133847631.html MY COMMENT Monthly data is bad enough....but weekly data.....what a joke. AND....we have seen that this employment data is probably the WORST of any government economic data.....totally worthless and inaccurate.
Of course it would not be a market day without some mention of NVDA. Nvidia stock has 25% upside as it approaches an iPhone moment with its Blackwell chip, analyst says https://finance.yahoo.com/news/nvidia-stock-25-upside-approaches-034458011.html (BOLD is my opinion OR what I consider important content) "Nvidia has rocketed to all-time highs, but investors should hold on a while longer as the company's next-generation Blackwell GPU will be a watershed moment, a note from Melius Research this week said. Ben Reitzes, a managing director at Melius, bumped his Nvidia price target to $185, representing potential upside of 26% from current levels. Reitzes believes Nvidia is approaching its Apple iPhone moment, and that selling now would be akin to selling Apple stock after it released the first generation iPhone. "It's similar to the feeling around product cycles with Apple's iPhone some 15 years ago, just on a different scale. So, while it sounds strange, giving up on Nvidia here after its hit — Hopper — is like giving up on Apple at iPhone 1 or 2," Reitzes said, referring to the current generation Hopper chip. Nvidia stock has been a tear ever since OpenAI released ChatGPT in November 2022. Since then, Nvidia has soared nearly 800% to become the largest company in the world, with a market capitalization of over $3.5 trillion. Nvidia's Hopper and upcoming Blackwell GPU chips represent the foundation of artificial intelligence advancements, which are powering everything from AI chatbots like ChatGPT to text-to-video and self-driving cars. "Big clouds, sovereigns and large enterprises are still more likely to invest more in this 'once-in-a-lifetime opportunity," Reitzes said. And Nvidia's enviable position means big profits are in store for its investors, according to the note. "We are not only excited about Blackwell driving upside to the street in 2025 — and Rubin in 2026 — but we are also increasingly optimistic that gross margins can snap back firmly into the mid-70s by mid-FY26," Reitzes said. Nvidia could earn more than $5 per share in profits by 2027, which "looks conservative now," according to the note. Reitzes increased his revenue and profit estimates for 2025 through 2027 for Nvidia, citing higher gross margins and continued investments from cloud hyperscalers. And at those profit levels, Nvidia stock looks attractive from a valuation standpoint. "Even with a decelerating growth rate on huge numbers, Nvidia's CY2025 PEG ratio stands at about 0.8x on our estimates. This ratio is 33% less than Broadcom's and the lowest in the Mag 7 by a wide margin," Reitzes said. Nvidia stock is up 197% year-to-date and trading about 2% below its record high of $149.77 per share." MY COMMENT LOL....I am NOT an analyst.....although I play one on this thread........sometimes. My.....magic eight-ball........view of NVDA over the next 2-3 years........+250%. AND....with that "guess" I am holding back and being conservative.
Speaking of NVDA......looking at my two accounts I have some hefty gains in the stock. Oldest shares show a gain of over +1000% in one of my two primary accounts. In this particular account due to adding shares over many years the gain for all shares is +354%. In my other primary account......the total long term gain that I have in NVDA is +537%. The earliest shares in this account are at.....+1100%. Where are you at TireSmoke with your oldest shares? Probably way above my gains above.
Right now I have a small gain to start the day. Mostly due to NVDA being up at the moment. i have four stocks UP and five stocks DOWN.
just playing with some data in an OLD IRA account. My sibling has an old IRA account that I have never messed with. Up till August 12, 2024.....it was siting 100% in the SP500 Index. I have been managing her BIG brokerage account for a long time....but have ignored the IRA in the past. On August 12 of this year I decided that the IRA account was too big to just let it all sit in the SP500. It had gotten to the point of having multiple hundreds of thousands of dollars in the account........over $200,000....but...below $400,000. So on August 12, 2024.....I sold out a big chunk of the SP500 Index and put ALL the funds into my typical nine stocks.....all in all at once. Fast forward three months. NOW....48% of the account is in my typical nine stocks.......52% of the account is in the SP500. Over that three months here is how each position has done: GOOGL +6.03% AMZN +26.40% AAPL +4.98% CMG +9.07% COST +8.26% HD +16.55% MSFT +4.82% NVDA +40.00% PLTR +97.00% In this particular account and also in my kids account and their spouses account.....CMG and PLTR are full size positions. In my brokerage accounts they are STILL SMALL positions. Primarily due to not having any money to boost them up....I dont want to sell anything else to add to CMG and PLTR. BUT...eventually I will get a chance to add to them when I have some new money for the accounts. The total stock portion of the IRA account above has a gain of +27% since august 12, 2024. All in all a very satisfactory move in this account. Although three months is still......THE SHORT TERM. So nothing to write home about....yet. I suspect that my sibling has at least a 20 year life expectancy....over that time is when the real GAINS will come. I am posting this as yet another example of "MY" investing process......and thinking.
I'd have to dig to find out but after the splits I bet it would be the equivalent of buying at around $1 or $2 per share at today's price. It has been a heck of a ride. I kind of let it be it's own thing and try to treat it separately than my day job and side business. The good news, I think, is next year they are changing our benefits provider and it opens up more investment options for my 401k. Right now the only stock option is our company stock, which is kicking a$$ the past few years. I only have 4% of my 401k in company stock and the rest in Vanguard S&P500. I have a bit of thinking to do before I make any changes.
BUMMER.....the markets have now...."weenied out". Yes that is an investing term of art. I assume this is why: Fed does not need to 'be in a hurry' to lower rates: Powell https://finance.yahoo.com/news/fed-...-a-hurry-to-lower-rates-powell-200004723.html
TSLA is now down by $46.52 from the high this week. Tesla stock falls 4% as Trump trade fades, EV tax credits come under threat https://finance.yahoo.com/news/tesl...-tax-credits-come-under-threat-170918953.html
Personally I would like to see them restore the ability of EVERYONE....regardless of taking the standard deduction or the amount......to deduct property taxes on their primary home....on their taxes.....in place of the credit for buying an EV which goes to the most well-to-do segment of society. Exclusive-Trump's transition team aims to kill Biden EV tax credit https://finance.yahoo.com/news/exclusive-trumps-transition-team-aims-172748188.html
Thank you POWELL for tanking the markets. Another small loss for me today. BUT....I did manage to beat the SP500 by 0.40%. Money in the bank. Moving on to Friday and next week NVDA day on Wednesday. I am sure NVDA will put up very nice numbers.....but....am not counting on the stock to be UP as a result.
