The Long Term Investor

Discussion in 'Investing' started by WXYZ, Oct 2, 2018.

  1. WXYZ

    WXYZ Well-Known Member

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    You have to LOVE these SHALLOW holiday markets......well....not really. With everyone preoccupied and many off work, especially in the investing world......the markets just DRIFT. BUT......who cares.......it is going to be a BOOMING Christmas season for business and retail this year.

    Data: Early holiday shopping boosted by urge to 'splurge' in face of inflation, supply issues

    https://finance.yahoo.com/news/sale...boosts-in-holiday-online-sales-143052448.html

    (BOLD is my opinion OR what I consider important content)

    "With fewer COVID-19 restrictions on in-person shopping, data suggests digital commerce revenue is already rising, signaling that economic headwinds aren't slowing the consumer's willingness to spend.

    With consumers kicking off the holiday season early given supply chain bottlenecks, revenue from Web purchases is up 18% in the U.S. and 8% globally year-over-year, according to Salesforce digital commerce sales data.

    "That tells us that consumers have read the headlines about potential issues with product availability and they're shopping early," Rob Garf, VP and GM of Retail at Salesforce, told Yahoo Finance in a recent interview.

    Meanwhile, many Americans are suffering from sticker shock after seeing prices rise in recent months. The average selling price (ASP) has soared this holiday season compared to last year, with prices jumping 12% in the U.S. and 11% globally.

    "The inflationary concerns are coming to bear, but there's still a splurge," Garf added. "Consumers are happy, they're feeling good and positive and they're shopping early."

    Major retail earnings out this month revealing a divide between retailers trying to keep their prices low for consumers, and those that are able to pass the costs to shoppers this holiday season. However, Salesforce found that for the second half of the year, retailers are going to absorb about $223 billion incremental cost of goods sold.

    "They're going to absorb much of that as I mentioned, but they are going to pass some of that along to the consumers, but there is this sense of positivity and consumers are buying," Garf said.

    Many Americans began shopping for holiday gifts as early as Halloween — heeding retailers warnings that supply chain issues could lead to shortages of popular Christmas gifts.

    In fact, retailers have pulled back on early-season discounts with rates in the U.S. down 16% and 10% globally, Salesforce data found.

    "We're typically seeing an increase at this time of year. I've been calling it this case of discount chicken, where retailers going into the holiday season have this great thought out holiday calendar, and after the first week they rip it up and they call audibles and they discount and they chase the margin," Garf told Yahoo Finance.

    "Consumers might not win the game of discount chicken this year," he warned. "Buy early buy often, especially with product availability issues."

    With inflation — which is at a 31-year record high with prices of goods and services up 6.2% since last year — certain product categories are seeing an uptick in sales this holiday shopping season: luxury handbags is up 59%, furniture 44%, and footwear at 37%.

    "What we see is more experiential categories, right? We're going from this last year and a half of needs and we're shifting to wants," Garf said.

    Even with sales already in full force at many stores, retailers still expect a big turnout on Black Friday, traditionally among the biggest shopping days of the year.

    "For digital in particular, we'll see spikes on Black Friday," Garf said. "Two-thirds of [shoppers] say they will go into the store again. It's really a balance of the digital shopping and the store shopping and really being able to blend that together, creating a seamless experience." "

    MY COMMENT

    YEP.......money in the bank for investors. The SLOW re-opening continues. The "economists" and "prediction experts" are way behind the curve. The country....regular people.....in most states have moved on from Covid. A few states are still locked down and living in COVID FANTASY.....but who cares....that is their problem. Money in the economy is overflowing.....people are spending. People with investment accounts and owners of homes are FLUSH.
     
  2. WXYZ

    WXYZ Well-Known Member

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    There is a reason that I focus on the BIG CAP GROWTH side of the markets. The up and coming young companies......THAT ARE PROVEN. There are always many companies....especially in TECH.....that are the next BIG thing. Unfortunately....for the vast majority of them....it never happens to the extent that investors anticipate. I STRONGLY prefer to miss out on the very early years and wait to get in after the company is at the START of its PROFITABLE BOOM years. I try to identify the DOMINANT companies when they are still young.....BUT....the handwriting is on the wall. When I find a company like that.....I ride the wave for as long as possible.

    Selloff in Highly Priced Tech Stocks Is Pressuring Hedge Funds That Piled In

    https://finance.yahoo.com/news/selloff-highly-priced-tech-stocks-210818031.html

    (BOLD is my opinion OR what I consider important content)

    "(Bloomberg) -- Losses are picking up in very-high-priced technology stocks that had recently grown in popularity among hedge funds.

    Farfetch Ltd. and Snowflake Inc. fell, driving a basket of software and internet companies that have yet to earn any money down more than 5%, its biggest decline since March, data compiled by Goldman Sachs Group Inc. show. Farfetch plunged 14% after the online apparel retailer trimmed its full-year forecast for digital growth. Snowflake, a software developer due to report results next week, sank 9%.

    That’s bad news for hedge funds who just boosted exposure to high-growth, high-valuation stocks to extreme levels. At the start of the fourth quarter, companies with enterprise value exceeding 10 times sales accounted for a third of their equity holdings, the highest level since at least 2002, according to data from fund filings compiled by Goldman.

    A lack of profits had until recently done little to dissuade investors betting that rock-bottom interest rates will justify valuations for expensive stocks such as technology. Now as the bond market has started to price in higher odds of rate hikes next year after President Joe Biden picked Jerome Powell for a second term at the head of the Federal Reserve, investors may be reconsidering their appetite.

    While many of these high-growth, low-profit companies have attractive outlooks, the dependence of their current valuations on long-term future cash flows makes them particularly vulnerable to the risks of rising interest rates or disappointing revenues,” Goldman strategists led by David Kostin, wrote in a Friday note.

    It could be bad timing or it could be a case of selling begetting selling, considering the growing concentration of these stocks in the portfolios of professional speculators. Notable losses in a few companies that don’t fit the high-priced tech definition but are also hedge-fund favorites -- Visa Inc. and Mastercard Inc., for instance -- could be evidence that positions are being unwound.

    The pain is not limited to hedge funds. Another devotee of growth stocks, the famed money manager Cathie Wood, saw her flagship ARK Innovation ETF (ARKK) drop more than 4%, extending its monthly slide to 11%. Another fund, ARK Genomic Revolution ETF (ARKG), sank 5% to a one-year low.

    Hedge funds might have doubled down on super-growth stocks, seeking to catch up with the market amid favorable year-end trends, according to Michael Purves, founder of Tallbacken Capital Advisors. Thanks to the drag from bearish bets and spotty stock picking, the industry has struggled to keep up with the market, with those tracked by Hedge Fund Research Inc. returning 12% this year. That’s less than half the gain of the S&P 500.

    With their concentrated bets going awry, fund managers could be forced to unwind the positions as the window for the annual book is quickly closing.

    I’m guessing they figured a big broad equity gain would lift all boats into year end, and that you would get outperormance from higher volatility/higher beta stocks,” said Purves. “If hedge funds were really bulled up, they have to suddenly de-risk that exposure that will exacerbate” the selloff, he added.

    To Dennis DeBusschere, founder of 22V Research, the retreat coinciding with a selloff in the cryptocurrency market may hurt sentiment of the retail crowd, whose wealth has appreciated significantly amid a rally in some of the riskiest corners of financial markets.

    “A puke in unprofitable Tech will worry some people, especially if it translates into further drawdown of Bitcoin/other crypto,” he said. “Just about all investors I talk to are worried about the consequences of a large move lower in the crypto related” space."

    MY COMMENT

    AS USUAL......making money in the market is NOT based on SPECULATION. It is all about PROBABILITY. It is FUN to watch the insanity.....but....I will not participate in it. That is why I have CONSISTENTLY invested in the same old way for over 45 years. LONG TERM investing......for life. The......"accumulation".......of wealth. Anyone can do it.......if you give it some realistic and reasonable thought.
     
  3. WXYZ

    WXYZ Well-Known Member

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    I have....NEARLY.....a perfect, uniform, portfolio this morning. EVERYTHING is RED except for one stock.....Costco. It is Up by 11 cents.
     
  4. WXYZ

    WXYZ Well-Known Member

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    It is a nice week for me this week. I have FOUR shows......WED, FRI, SAT, SUN. The BAD news.....all are outside. Hopefully the weather will hold and none will get canceled due to the cold or rain.
     
  5. WXYZ

    WXYZ Well-Known Member

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    I am sure EVERYONE that reads here knows that I have.......ZERO......interest in Chinese companies. The worlds most brutal communist dictatorship, etc, etc, etc. Here is a bit of information on that topic.

    How to avoid the world's second biggest economy in your portfolio

    https://www.cnn.com/2021/11/22/investing/china-stocks/index.html

    (BOLD is my opinion OR what I consider important content)

    "The Chinese economy presents some unique challenges for investors. On one hand, China is home to several of the most dynamic and rapidly growing companies on the planet, such as electric car makers Xpeng and Nio (NIO) as well as privately held TikTok owner ByteDance.

    But China's recent crackdown on the tech sector has slowed earnings momentum at big brand name firms including Baidu (BIDU), Alibaba (BABA) and WeChat owner Tencent (TCEHY).

    Continued human rights concerns, brought to the forefront once more following questions about the safety of tennis star Peng Shuai, are also a problem for some investors.

    So can (and should) you avoid the world's second largest economy? Some experts think that's exactly what investors should be doing.

    "Investors have underestimated autocracy risk," said Perth Tolle, sponsor of the Freedom 100 Emerging Markets (FRDM) ETF, a fund that has no exposure to Chinese stocks.

    "You can't always factor in the risk of a government coming in overnight and saying to a company 'you can't really make a profit,'" she said.

    Tolle told CNN Business that investors should be more concerned about capital flowing out of the country due to worries about Beijing exerting more control over companies in mainland China.

    That's why her fund has more exposure to other markets such as Taiwan and South Korea instead of China. Taiwan Semiconductor (TSM) and Samsung (SSNLF) are two top holdings in the FRDM ETF.

    Emerging markets funds doing better without China exposure

    Tolle isn't the only one screening out China from emerging markets funds. Big fund companies such as iShares and Columbia Threadneedle also have emerging market ETFs that leave Chinese companies out of their holdings.

    The funds have outperformed broader emerging markets funds this year, too, showing that investing for social good can be profitable.

    The FRDM ETF, as well as the iShares MSCI Emerging Markets ex China ETF (EMXC) and Columbia EM Core ex-China ETF (XCEM), are each up between 6% and 8% in 2021.

    That's compared to a 2% drop for the broader iShares MSCI Emerging Markets ETF (EEM), which owns Tencent, Alibaba and Chinese food delivery service Meituan as top holdings.

    Other investing experts argue that Chinese president Xi Jinping's recent push to crack down on big tech firms is not a good sign for earnings in the short-term.

    "We like the longer-term view, but in the near- term, we're more cautious," said Jeff Mortimer, director of investment strategy at BNY Mellon Wealth Management. "Some other emerging markets have better growth potential."

    "The move from promoting more entrepreneurship to an equal growth sharing of the pie changes the equation," he added. "We took some money off the table and reduced our exposure to China."

    Another portfolio manager argued that trying to predict which companies or sectors will come under the "Xi Jinping thought sphere of influence" makes investing there a challenge. Major Chinese education stocks have taken a hit this year as well due to regulatory concerns.

    "The investor perception of risk has risen in China, and it has risen with cause," said Paul Espinosa, portfolio manager with Seafarer Capital Partners.

    Espinosa also said China isn't as attractive as other emerging markets simply because stocks outside of the country are better bargains.

    Companies in Brazil and others parts of Latin America are more compelling values than Chinese-based firms, Espinosa said. He's also looking at investment opportunities in the Middle East.

    "Everyone is so focused on China, and it is dominated by growth investors," he said. "But there are more opportunities outside of China.""

    MY COMMENT

    NO.....I will not invest with the communist dictator of China having absolute and total control over my money.

    As to emerging markets.......who cares. Over my lifetime I see this stuff over and over and over. They NEVER emerge. It is the same countries it has been for the past 45 plus years I have been investing. In fact........the vast majority of the emerging countries.........have been emerging for over 100 years now.....it NEVER happens.

    SAME....with International investing. Why waste my time. I can count on two hands the number of International companies that I would call WORLD LEADERS in their field. The few I have looked at in the past.....I NEVER pulled the trigger and I am glad I did not. the simple truth is.....AMERICAN COMPANIES and BUSINESS.....are the WORLD LEADERS in most business categories.

    MY.......dominant....companies give me plenty of International business exposure. I am sure there are investors that do very well in the emerging markets and international investing......but....it is just not my thing.
     
  6. oldmanram

    oldmanram Active Member

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    In times like these I like use the "Retail Therapy" approach to keeping me positive
    What's on SALE today ????


    We all know the market is a little overvalued,
    And a little Holiday correction might just be the ticket to pick up some momentum leading into next year.

    Or we could crash because of the fear mongering about inflation
    EDIT: On inflation, it is world wide, simple supply demand inflation, it will more than likely trend down from here as the supply chain is restored back to normal.

    "W" ..... ditto on the Chinese companies, I'm just avoiding at all cost

    "W" Have fun this week ,
    Watch out for the mother/daughter groupies
    and Don't get electrocuted if it rains
     
    WXYZ and TomB16 like this.
  7. andyvds

    andyvds Active Member

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    I'm pretty sure, before the end of December, we're on an QQQ all-time high trip again.
     
    WXYZ likes this.
  8. WXYZ

    WXYZ Well-Known Member

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    I should SELL all the TESLA that I bought on Monday........I am DOWN by 5.7%. OMG......OMG.
     
    TomB16 likes this.
  9. WXYZ

    WXYZ Well-Known Member

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    Today was such a LOSER of a day all through the day....that...by the time we got to the end and had prices come back some......it ended up as a fairly minimal loss for me. I was RED today....but not by a lot. It was nice to see Amazon and Apple end up in the green along with Costco which was green all day. I will take it.......A MORAL VICTORY......type of a day. I got beat by the SP500 by 0.52% today.
     
    #8549 WXYZ, Nov 23, 2021
    Last edited: Nov 23, 2021
  10. TomB16

    TomB16 Well-Known Member

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    You picked up trading skills quickly.

    :biggrin:
     
    WXYZ likes this.
  11. WXYZ

    WXYZ Well-Known Member

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    Basically last market day of the week tomorrow. The markets will be closed on Thursday and than only open till 1:00 on Friday.
     
    TomB16 likes this.
  12. WXYZ

    WXYZ Well-Known Member

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    OK.....my "new" TSLA went up some before the close so I am ONLY down by.......4.6%......since I bought on Monday....... to end the day.

    This LONG TERM investing is hard.

    Ok...so back to reality. STILL glad that I made this buy on Monday. Over the long term the all in all at once....no market timing.....WILL......pay off as usual. When you have a multi DECADE horizan.......assuming that I live that long......it is much EASIER to be an investor. AND...fortunately....my entire TESLA position is still nicely positive.
     
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  13. WXYZ

    WXYZ Well-Known Member

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    NOW.....lets focus on what is really important today......PIE. I got my Pecan Pies made last night. They are in the refrigerator. They look great.....even if I do say so myself.

    Tomorrow is going to be a PIE day at our house. There will be Apple, Pecan, Pumpkin, and French Silk Chocolate.

    I guess you can tell......I am IGNORING the markets today. It is just a RE-HASH of yesterday. My account is doing exactly what it did yesterday......nine positions in the red....and....COSTCO in the green.
     
    Jwalker likes this.
  14. WXYZ

    WXYZ Well-Known Member

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    WELL......nothing to see in the markets today.....so I will post a little article about my favorite......most brutal communist dictatorship in the world. This is indirect information for investors.....but.....another brick in the wall when it comes to doing business or investing in Chinese companies. PLUS......I think this is an interesting story.

    China's disappearing ships: The latest headache for the global supply chain

    https://www.cnn.com/2021/11/24/business/china-shipping-data-mic-intl-hnk/index.html

    (BOLD is my opinion OR what I consider important content)

    "Hong Kong (CNN Business) Ships in Chinese waters are disappearing from industry tracking systems, creating yet another headache for the global supply chain. China's growing isolation from the rest of the world — along with a deepening mistrust of foreign influence — may be to blame.

    Analysts say they started noticing the drop-off in shipping traffic toward the end of October, as China prepared to enact legislation governing data privacy.

    Usually, shipping data companies are able to track ships worldwide because they are fitted with an Automatic Identification System, or AIS, transceiver.

    This system allows ships to send information — such as position, speed, course and name — to stations that are based along coastlines using high-frequency radio. If a ship is out of range of those stations, the information can be exchanged via satellite.
    But that's not happening in the world's second-largest economy, a critical player in global trade. In the past three weeks, the number of vessels sending signals from the country has plunged by nearly 90%, according to data from the global shipping data provider VesselsValue.

    "We are currently seeing an industry wide reduction in terrestrial AIS signals in China," said Charlotte Cook, head trade analyst at VesselsValue.

    New data law could worsen supply chain chaos

    Asked about the issue, China's Ministry of Foreign Affairs declined to comment. The State Council Information Office, which acts as a press office for the country's cabinet, did not immediately respond to a request for comment about why shipping providers were losing access to data.

    But analysts think they've found the culprit: China's Personal Information Protection Law, which took effect November 1. It requires companies that process data to receive approval from the Chinese government before they can let personal information leave Chinese soil — a rule that reflects the fear in Beijing that such data could end up in the hands of foreign governments.

    The law doesn't mention shipping data. But Chinese data providers might be withholding information as a precaution, according to Anastassis Touros, AIS network team leader at Marine Traffic, a major ship-tracking information provider.

    "Whenever you have a new law, we have a time period where everyone needs to check out if things are okay, "Touros said.

    Other industry experts have more clues of the law's influence. Cook said that colleagues in China told her that some AIS transponders were removed from stations based along Chinese coastlines at the start of the month, at the instruction of national security authorities. The only systems allowed to remain needed to be installed by "qualified parties."

    Not all of the data is gone: Satellites can still be used to capture signals from ships. But Touros said that when a ship is close to shore, the information collected in space is not as good as what can be gathered on the ground.

    "We need terrestrial stations in order to have a better picture, a more high-quality picture," he added.

    With Christmas approaching, a loss of information from mainland China — home to six of the world's 10 busiest container ports — could create more problems for an already troubled global shipping industry. Supply chains have been under strain this year as badly congested ports struggle to keep up with a rapidly rebounding demand for goods.

    Shipping firms rely on AIS data to predict vessel movement, track seasonal trends and improve port efficiency, according to Cook from VesselsValue. She said the lack of Chinese data "could significantly impact ocean supply chain visibility across China." The country is one of the world's major importers of coal and iron ore, as well as a huge exporter of containers.

    "As we move into the Christmas period, it will have a really big impact on [supply chains] and this is the most important element right now," said Georgios Hatzimanolis, media strategist for Marine Traffic. He expects the loss of "minute by minute" ship data from China to have "a great impact on the supply chain," since companies may lose crucial information about ship docking, unloading and leaving times.

    The global supply chain is already under "great stress," he added. "It doesn't need another factor to make it more difficult."

    China's self-isolation

    China's desire to retain absolute control over all data and information within its borders isn't surprising, as President Xi Jinping continues to reassert the ruling Communist Party's dominance in every aspect of the economy and society.
    The country has been pushing for economic self-sufficiency as it faces external threats, such as US sanctions on key technologies.

    Xi emphasized his self-reliance goals in the years before and during a bitter trade and tech war with former US President Donald Trump. That's the point, for example, of "Made in China 2025," an ambitious plan to push China's manufacturing sector into more advanced technological fields.

    Some top officials in Beijing have recently tried to quell concerns among global investors that the country is isolating itself from the rest of the world as it prioritizes national security.

    Chinese Vice President Wang Qishan, considered a trusted ally of Xi, told the Bloomberg New Economy Forum in Singapore that China would not "develop isolated from the world." Speaking via video, he also called on countries to keep supply chains "stable and smooth."

    But China has embraced policies during the coronavirus pandemic that often appear to do otherwise.
    For example, during the pandemic Xi has doubled down on his push for self-reliance, stressing the need to create "independent and controllable" supply chains to ensure national security.


    And the country's sweeping clampdown on tech extended this summer to foreign IPOs, when the Cyberspace Administration of China proposed that major companies with more than a million customers seek approval before listing shares overseas. As with the recent data privacy law, the agency cited concerns about whether personal data held by those companies could be exploited by foreign governments.

    China's actions this year may come at a cost, though, if the country goes too far in its attempt to protect itself from perceived foreign interference."

    MY COMMENT

    Yet another.....WARNING SIGN.....for would be China investors........and....another BIG CLUE for those companies that insist on continuing to do their manufacturing in China.

    OBVIOUSLY this is intentional. ANY analyst that thinks this is just because of new PRIVACY LAWS in China is......DUMB AS A POST. China is INTENTIONALLY isolating itself from the world and from any system that might allow others to see what is going on in the country. If I was a......conspiracy nut.....I might think this was an......intentional....... attempt to make our supply chain issues a little more of a problem.
     
    #8554 WXYZ, Nov 24, 2021 at 10:05 AM
    Last edited: Nov 24, 2021 at 10:18 AM
  15. WXYZ

    WXYZ Well-Known Member

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    I like this little article.......it reflects a valid observation......especially for long term investors.

    Don't Fight a Market That Is Right Much More Often Than It's Wrong

    https://www.realclearmarkets.com/ar...ht_much_more_often_than_its_wrong_805017.html

    (BOLD is my opinion OR what I consider important content)

    "Two years on from the pandemic’s dawn, and pundits remain blind to its biggest lesson: Don’t fight the market. It is right much, much more often than all those who keep arguing it is wrong.

    That crowd has been wrong at virtually every turn over these 20 months, since stocks bottomed in the short, painful, lockdown-induced bear market. A big rally despite COVID’s spread and persistent lockdowns? “The market is wrong!” Then it was “wrong” that growth stocks were leading off the lows instead of value, a mistake vaccine rollouts would surely “fix.”

    Next stocks were “wrong” to overlook the contentious presidential election and January 6. “Wrong” to rise through winter lockdowns Mak-II and the Delta variant’s later surge. Rising stocks and low bond yields are “wrong” about the Fed’s quantitative easing taper and elevated inflation. And supposedly wronger longer as they power through supply chain catastrophes, labor shortages and vaccine mandate chatter.

    This craziness must end sometime, surely--no? No. It isn’t craziness. It is right.

    Yes, in the very short term, markets can seem quite irrational and inefficient. That is where bubbles and panics alike seemingly come from. Like Ben Graham said, stocks are a voting machine in the short run—about popularity. But in the intermediate to long run a weighing machine…weighing fundamentals….relatively rationally and efficiently. And more rationally and efficiently than you and I can. That is what we have seen these past two years, as stocks priced what pundits couldn’t envision. And maybe you couldn’t.

    And, of course, stocks legendarily pre-price all widely known information and opinions, no matter how smart we think we are. And the pundit and grouser crowd’s information and opinions are always widely known and discussed—hence priced.

    So to get ahead, shift your focus. Assume the market is basically right and efficient, not irrational and wrong. People, many very smart people, will call it reckless and foolhardy, but it is the wisest, most time-tested way to navigate the market and reality. To see it, just flip all of these events on their head.

    Start with stocks’ initial rally in late March 2020. Stocks rightly jumped fast off the low since nearly everyone could see and understand the bear market’s cause near-immediately—and estimate the associated economic damage. Unusual! There was no uncertainty about the downturn’s main driver. It was lockdowns, full stop. The fallout was obvious nearly instantly. That let markets price the damage faster than ever. It also gave stocks a clear view of what would end the carnage: reopening. Even without a precise timetable from the government, stocks subconsciously understood a reopening would come before long. They were right.

    Growth stocks’ leadership was right, too. Putting the economy in a medically induced coma didn’t reset the economic cycle that began way back in 2009. It simply put it on ice, ready to resume close to where it left off once lockdowns ended. That meant stocks naturally behaving as they do in almost every maturing expansion, which is when growth usually leads.

    Moreover, growth stocks were simply positioned better than value to weather the remaining ongoing issues. Their fat gross margins were shock absorbers. They concentrated in sectors and industries that were lockdown winners thanks to e-commerce and remote work. More economically sensitive value stocks have thinner gross operating margins and smaller cash cushions and rely on debt financing. They face headwinds that few appreciate to this day.

    Stocks have been no less rational over this past year. Looking past the election was utterly right, considering the gridlock-lite the election brought. This legislature is among the most do-little in decades, and audacious proposals seemingly die daily. Look how watered down the infrastructure bill became from initial proposals—only about $550 billion in genuine new spending–much of which may never get spent. It spreads spending over more than the slated five years, considering permitting and construction timelines. The social spending bill has shed programs and tax hikes alike—with more to come. The longer it drags the smaller it gets—if it passes at all–and if it isn’t re-negotiated by future congresses which it almost surely will.

    The Delta variant? We now have data galore showing it didn’t stop the recovery when it supposedly ravaged the Sun Belt this the summer. That offers an approximate blueprint for any wintertime surges in California and northern states. That stocks correctly didn’t tank on Delta’s rise should prove beyond a shadow of doubt in the dark and dreary minds’ of the pundits and grousers that lockdowns drove 2020’s early-year decline.

    The supply chain crunch? Q3 earnings reports show stocks were dead right to rise through it. S&P 500 earnings soared far past expectations. Gross margins stayed resilient in all sectors, with Tech and Tech-like Communication Services leading the charge. This, too, stocks already told you about, as growth has led value by a mile since mid-May.

    Inflation? Stocks aren’t wrong to rise through it—again, see earnings. Consumers hate it, but businesses have pricing power. That preserves margins as prices rise, making stocks a hedge against the kind of initial inflation hiccups we’ve encountered. Nor are bond yields wrong to stay low, as high inflation comes from the supply crunch—temporary. After one-off price jumps flow through the economy, inflation eases as prices rise more slowly off a higher base.

    QE tapering? It proved fine for stocks in 2013. Relatively efficient markets know this, too. Trust them.

    Stocks constantly size up all of these and more, registering the likely outcome in prices. Those prices are the best darned single signal of reality extant. So don’t pooh-pooh markets. This Thanksgiving, show markets some gratitude and love for their hard work. And listen closely in the New Year. There is an aged saying seldom heeded….”The Market Knows.” And it knows more than you and I do, thankfully."

    MY COMMENT

    A CLASSIC rationale for long term investing. The VAST majority of short to medium term blather and hand wringing is ALWAYS WRONG. The long term direction for the markets is.....sooner or later.......ALWAYS POSITIVE. The items and reasoning that the short term thinkers always focus on are simply a mirage.....illusion. Traders love it. It is what creates the short term volatile trading environment that allows then to......"TRY".....to make money. As a long term investor........IGNORE it all.
     
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  16. WXYZ

    WXYZ Well-Known Member

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    When I looked a short time ago.......I was GREEN. A nice change up from the past couple of days and the open today.

    I wish to say......HAPPY THANKSGIVING.....to all posters, readers, lurkers, and investors.

    We should ALL be thankful for having the ability to invest and provide for the future of ourselves and our family. In the end that is what it should all be about.....FAMILY. I also want to say THANK YOU to the STOCKAHOLICS family for this site.
     
  17. emmett kelly

    emmett kelly Well-Known Member

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    what time should we start arriving at your house?
     
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  18. TireSmoke

    TireSmoke Member

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    Happy Thanksgiving! @emmett kelly glad to know you will be there too! Hopefully W made enough pies!
     
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  19. WXYZ

    WXYZ Well-Known Member

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    Beside all the pies that we made....a local realtor gave us a GIANT Apple pie and a GIANT pecan pie. SO....we have a total of EIGHT pies in the refrigerator right now. One giant apple, one giant pecan, three normal pecan, one French Silk Chocolate, and two pumpkin. That is for NINE people.

    Add in a 23 pound turkey, meat dip, artichoke dip, queso dip,, four kinds of chips, a nice size INTERNATIONAL award wining White Cheddar cheese, fancy crackers, olives, celery sticks, glazed carrots, petite peas, mashed potatoes, stuffing, cranberry, gravy, deviled eggs, two different types of rolls.

    YEAH....I guess we have enough for STOCKAHOLICS to drop in. In our house......what supply chain issues? We have to do all this so EVERYONE......by request...... can take home massive amounts of left-overs.
     
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  20. WXYZ

    WXYZ Well-Known Member

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    I REALLY dont care about inflation as a happening or as an economic event. It is just NOT relevant to me as an investor. BUT....I do post on the topic for those that are interested or want to follow along on the topic. Here is the latest semi-economic data.

    A key measure of inflation rose to a 31-year high in October

    https://www.cnn.com/2021/11/24/economy/third-quarter-gdp-inflation/index.html

    (BOLD is my opinion OR what I consider important content)

    "US price surges eased in the third quarter of the year. But they climbed to a more than 30-year high in October — showing the pandemic price hikes are clearly not behind us yet.

    A deluge of economic data ahead of the Thanksgiving holiday highlights how the pandemic economy is still very much in flux.
    A key measure of inflation stood at 5% over the 12-month period ended in October
    , the Bureau of Economic Analysis reported Wednesday. That was the highest level since November 1990.

    Stripping out food and energy costs, which tend to be more volatile, prices rose 4.1% over the period, the most since January 1991.

    Meanwhile, the same inflation gauge grew at annualized rate of 5.3% in the third quarter, the BEA reported earlier Wednesday morning. That compares with an increase of 6.5% in the second quarter. While that's good news in principle, prices are still very high.

    The same early report updated the pace of US economic growth between July and September to 2.1% on an annualized basis, slightly less than economists had predicted. An initial report last month said the economy had grown at a rate of 2% last quarter. The little bump was due to strong consumer spending in spite of the high prices.

    Even so the economy grew at a much weaker pace in the third quarter than in the three months before, when the pace of growth was 6.7%. Over the summer, the growing supply chain challenges, along with worries about the rapidly spreading Delta variant of the coronavirus weighed on the recovery.

    Growth may have slowed over the summer, "but there is lots to give thanks for with a growth boom expected in the final quarter of the year," said Chris Rupkey, chief economist at FWDBONDS LLC.

    Economists expect that abating Delta worries, along with a faster pace of recovery in the labor market and rising wages, will make for a strong end to the year.

    Spending into the holiday season

    Even though prices are high, Americans can afford to spend their hard earned cash. At least for now. Concerns are brewing that inflation could rise to a level that will keep people from spending, which would be bad news for the recovery.

    High prices have consistently shown up in measures of consumer sentiment and are weighing on how people feel about the economy.

    The University of Michigan's consumer sentiment tracker for November looked slightly better than an initial read of the data earlier in the month, but the message still remained the same:
    "Consumers expressed less optimism in the November 2021 survey than any other time in the past decade about prospects for their own finances as well as for the overall economy," and that was down to the high inflation, said Richard Curtin, chief economist of the Survey of Consumers, on Wednesday.

    "Complaints about falling living standards doubled in the past six months and quintupled in the past year," he added.
    Survey participants expect their incomes to decline when adjusted for inflation, but for the holidays that won't make a difference yet. The desire to have a "normal" holiday season is strong, according to Curtin, and accumulated savings will help Americans spend big this year in spite of higher prices.

    Wednesday's data also showed this trend: In October, incomes increased 0.5%, while disposable incomes rose 0.3%. That was up from September when incomes fell. Meanwhile, spending increased 1.3% in October.

    The savings rate fell to 7.3%, the lowest level since December 2019.
    "

    MY COMMENT

    YES......the economy is slowing slightly. I suspect that we will see this continue into 2022 and 2023 and will eventually get back to a DEFAULT position......which is a DEFLATIONARY ENVIRONMENT.

    In my view inflation of 4.1% to 5% is not that much of a SHOCKER with all the FREE MONEY sloshing around and the supply issues we are having.

    What I find really STRANGE about this little article is the headline and the article talk about a "key measure of inflation" and "the same early report".....BUT.....NEVER mentions what report they are talking about in the article. I assume it is the ......personal consumption expenditures (PCE) data.
     

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