Stock Thread

[JAA 2,857]

1 minute ago, David Dodds said:

1 hour ago, JAA said:

GME at +25% today is scary.  Its ####### Tuesday.  Nothing good happens ever on Tuesdays.

Scary? This is literally the dip. 3 days from now and you are going to wish you had doubled down when it was only $245. 

I got diamond hands, just not a bottomless wallet!

Would be pretty ballzy of me to move my large and losing BB position into GME.

[Nigel 3,610]

5 minutes ago, David Dodds said:

Scary? This is literally the dip. 3 days from now and you are going to wish you had doubled down when it was only $245. 

I got in yesterday at $153 using unsettled funds to do so, no choice but to hold for a few days anyway. Not a huge position but happy to be along for the ride. 

[caustic 4,194]

Ballard Power Systems (NASDAQ:BLDP): +7.2% post-market, adding to an 11% run-up in today's regular session, on news that Canadian Pacific  (NYSE:CP) railroad will employ Ballard fuel cell modules for its Hydrogen Locomotive Program.

The modules will provide a total of 1.2 MW of electricity to power the locomotive.

Through the program, CP Rail will develop North America's first hydrogen-powered line-haul freight locomotive by retrofitting a formerly diesel-powered locomotive with Ballard hydrogen fuel cells. Ballard plans to deliver six of its 200 KW fuel cell modules to CP Rail in 2021.

[Ridgeback 97]

1 hour ago, kevzilla said:

I doubled the S&P's return in spite of being 56% cash, no complaints

Nice...! I made just over 2%, but not complaining as I'm sitting on 23% cash, and and anchor in TLT which is taking up 22% of my portfolio. 

[IC FBGCav 5,798]

25 minutes ago, David Dodds said:

Scary? This is literally the dip. 3 days from now and you are going to wish you had doubled down when it was only $245. 

I have considered this, just couldn't pull the trigger.  That was around 140.

[Sand 6,241]

23 minutes ago, IC FBGCav said:

I have considered this, just couldn't pull the trigger.  That was around 140.

I bought one share at 101 so I could watch it.

Problem:  NOW I HAVE TO ####### WATCH IT!

[Charlie Harper 1,226]

2 hours ago, JAA said:

I got diamond hands, just not a bottomless wallet!

Would be pretty ballzy of me to move my large and losing BB position into GME.

Hmmmmmmmmmm......

Man wish I would have thought of this when I added more GME at $100. Doing it at $240 is scary.

I am somewhat hesitant because I think once the GME stuff is done, WSB will go into BB like originally planned. I probably should DCA down into BB.

[Charlie Harper 1,226]

I also started a position on UWMC today. I was waiting until I sold some of my GME to get it in my ROTH, but because there was a post about it on WSB I bought it in my brokerage account since its a long-term hold anyways. 

WSB on $UWMC

If Chad and WSB are on the same side, sounds like a good stonk to me.

[cosjobs 15,364]

19 minutes ago, Charlie Harper said:

I also started a position on UWMC today. I was waiting until I sold some of my GME to get it in my ROTH, but because there was a post about it on WSB I bought it in my brokerage account since its a long-term hold anyways. 

WSB on $UWMC

If Chad and WSB are on the same side, sounds like a good stonk to me.

ex div date was today, so should be on sale tomorrow

[NajehHejan 430]

59 minutes ago, Charlie Harper said:

I also started a position on UWMC today. I was waiting until I sold some of my GME to get it in my ROTH, but because there was a post about it on WSB I bought it in my brokerage account since its a long-term hold anyways. 

WSB on $UWMC

If Chad and WSB are on the same side, sounds like a good stonk to me.

Getting in tomorrow- thanks!

[CGRdrJoe 4,121]

Game stop after hours 💎💎🙂🙂

[Capella 31,901]

Dodds -  explain where you think the price for GME is going and why?

[wilked 2,156]

1 minute ago, Capella said:

Dodds -  explain where you think the price for GME is going and why?

Check out Uncle Bruce, he gives good detail on the why and where it’s going 

[Capella 31,901]

5 minutes ago, wilked said:

Check out Uncle Bruce, he gives good detail on the why and where it’s going 

Who’s this 

[IC FBGCav 5,798]

11 minutes ago, Capella said:

Who’s this 

Youtuber, I recommend watching him too.

[IC FBGCav 5,798]

I think this starts with an explanation:

https://youtu.be/Wj4or1_eA_c

[Capella 31,901]

4 minutes ago, IC FBGCav said:

Youtuber, I recommend watching him too.

Just found him, thanks you and Wilked. 

[BassNBrew 11,872]

7 hours ago, Sand said:

MulletandMead quiet today.  Oh, yeah, Amazon is up...

Up 6% in my life savings account. Would have been 8% if The Bezos boat anchor wasn’t dragging me down. 

Hiking the AT this week.  Well part of it. Needed to let some funds settle and was pretty much all in after Monday after hours. 

[Capella 31,901]

31 minutes ago, IC FBGCav said:

I think this starts with an explanation:

https://youtu.be/Wj4or1_eA_c

Wait that’s 7 hours. Holy #### I can’t watch that. This guy talks for 7 hours? 

[CGRdrJoe 4,121]

2 minutes ago, Capella said:

Wait that’s 7 hours. Holy #### I can’t watch that. This guy talks for 7 hours? 

I made it 2 minutes and gave up 

[McBokonon 3,898]

5 minutes ago, Capella said:

Wait that’s 7 hours. Holy #### I can’t watch that. This guy talks for 7 hours? 

“So I tied an onion on my belt, which was the style at the time. Now, to take the ferry cost a nickel...”

”Oh FFS ok I’ll buy GME just stop please.”

[Bonfire 154]

So if there are a zillion market order for RBLX at market open, how is it decided what order they are executed? 

[Swaymoney 71]

27 minutes ago, Bonfire said:

So if there are a zillion market order for RBLX at market open, how is it decided what order they are executed? 

No idea, things will be crazy with RBLX tomorrow!  How do you even know what amount to put in for an order?

[CGRdrJoe 4,121]

Just now, Swaymoney said:

No idea, things will be crazy with RBLX tomorrow!  How do you even know what amount to put in for an order?

One million dollars! It should go up in 2 weeks 

[cosjobs 15,364]

BTC going crazy tonight. It shot up to 55.600 then plummeted $2000 to 53,500 in three hours.

[Swaymoney 71]

Anyone know a good site that can give you good stock price amounts on when to sell?

[CGRdrJoe 4,121]

6 minutes ago, Swaymoney said:

Anyone know a good site that can give you good stock price amounts on when to sell?

https://letmegooglethat.com/?q=footballguys.com
 

good luck

[Swaymoney 71]

19 minutes ago, CGRdrJoe said:

https://letmegooglethat.com/?q=footballguys.com
 

good luck

Or you could not be an azzhat, and recommend something from prior experience that would provide more and quicker insight than a Google search would.  Pretty ingenious, right?  

You find out your girl was cheating on you today and have to take it out on someone else?

 

Eta: btw, that's gotta be the worst, most arrogant response ever. If you know of a site that you've had success with, why not just share it?  Why be a jerk and suggest that I use Google, like I've never heard of it before?  Of course I searched some crap up and have a list.  If you have a list, would it kill you to share, instead of post an arrogant, condescending, useless response?  And if you don't have recommendation, keep your idiotic, useless response to yourself.  Isn't this thread about helping each other have success investing and making money? 

Edited March 10 by Swaymoney

[CGRdrJoe 4,121]

10 minutes ago, Swaymoney said:

Or you could not be an azzhat, and recommend something from prior experience that would provide more and quicker insight than a Google search would.  Pretty ingenious, right?  

You find out your girl was cheating on you today and have to take it out on someone else?

 

Eta: btw, that's gotta be the worst, most arrogant response ever. If you know of a site that you've had success with, why not just share it?  Why be a jerk and suggest that I use Google, like I've never heard of it before?  Of course I searched some crap up and have a list.  If you have a list, would it kill you to share, instead of post an arrogant, condescending, useless response?  And if you don't have recommendation, keep your idiotic, useless response to yourself.  Isn't this thread about helping each other have success investing and making money? 

You must be new here, grow some thicker skin 

[CGRdrJoe 4,121]

11 minutes ago, Swaymoney said:

Or you could not be an azzhat, and recommend something from prior experience that would provide more and quicker insight than a Google search would.  Pretty ingenious, right?  

You find out your girl was cheating on you today and have to take it out on someone else?

 

Eta: btw, that's gotta be the worst, most arrogant response ever. If you know of a site that you've had success with, why not just share it?  Why be a jerk and suggest that I use Google, like I've never heard of it before?  Of course I searched some crap up and have a list.  If you have a list, would it kill you to share, instead of post an arrogant, condescending, useless response?  And if you don't have recommendation, keep your idiotic, useless response to yourself.  Isn't this thread about helping each other have success investing and making money? 

Also, this has to be the worst post I this three and that includes all the cydy posts, TODEM posts the best picks ever, GM posts the worst picks ever that work out eventually and @hooter311will help you buy a zebra so either beagle or #### because it’s all here 

[Swaymoney 71]

2 minutes ago, CGRdrJoe said:

Also, this has to be the worst post I this three and that includes all the cydy posts, TODEM posts the best picks ever, GM posts the worst picks ever that work out eventually and @hooter311will help you buy a zebra so either beagle or #### because it’s all here 

Is that English?  Or should I copy and paste that into Google to have it translated?  

[Swaymoney 71]

8 minutes ago, CGRdrJoe said:

You must be new here, grow some thicker skin 

Always the cop out response.  OK deal, I'll throw some Scotts fertilizer on and grow thicker skin and, with all your infinite wisdom, you post a good site to help with target price points on when to sell stocks. 

Edited March 10 by Swaymoney

[CGRdrJoe 4,121]

18 minutes ago, Swaymoney said:

Always the cop out response.  OK deal, I'll throw some Scotts fertilizer on and grow thicker skin and, with all your infinite wisdom, you post a good site to help with target price points on when to sell stocks. 

Two weeks from now

[JB Breakfast Club 1,388]

19 minutes ago, Swaymoney said:

Always the cop out response.  OK deal, I'll throw some Scotts fertilizer on and grow thicker skin and, with all your infinite wisdom, you post a good site to help with target price points on when to sell stocks. 

Buy Finley (is this still a FBG joke? I haven't followed NFL for almost a decade).

[Yo Mama 5,043]

29 minutes ago, JB Breakfast Club said:

Buy Finley (is this still a FBG joke? I haven't followed NFL for almost a decade).

I’m still diamond hands with all my Antonio Gates stock from back i the day. 

[Bossman 1,919]

8 hours ago, BassNBrew said:

Up 6% in my life savings account. Would have been 8% if The Bezos boat anchor wasn’t dragging me down. 

Hiking the AT this week.  Well part of it. Needed to let some funds settle and was pretty much all in after Monday after hours. 

How can AMZN be dragging you down?

Did you buy in at $3k??

Edited March 10 by Bossman

[Capella 31,901]

10 minutes ago, Bossman said:

How can AMZN be dragging you down?

Did you buy in at $3k??

I think he got in at 3300 or 3400 

[jamny 6,631]

Well that escalated fast.

[Wild Young Billy 131]

14 hours ago, Sand said:

Good article here on Cathy Woods' Top 10 holdings and some of her thoughts on future technologies, bitcoin, etc.  In ascending order:

SPOT, TWST, Z, PSTG, NVTA, SQ, TDOC, CRSP, ROKU, TSLA.

The beta of that group is about 87.

 

I think that Square becoming a bank is a huge deal. Square serves the underserved SMB and will certainly make some headway by providing financial services to them. SMB are overlooked by the big banks and the small community banks often can't provide the services they need. 

I also think that the whole Banking as a Service (BaaS)  trend has an interesting future. 

[rick6668 1,257]

$135 away from a FBG subscription.

[wilked 2,156]

Uncle Bruce says hodl so I’m hodling 

[Navin Johnson 527]

9 hours ago, Capella said:

Wait that’s 7 hours. Holy #### I can’t watch that. This guy talks for 7 hours? 

Think he's set to go live again in 30 minutes.  Watching 0n 1.5x.  good stuff.

[McBokonon 3,898]

7 hours ago, Swaymoney said:

Anyone know a good site that can give you good stock price amounts on when to sell?

There’s no good answer here. That’s entirely dependent on your goals. If you belong to a normal broker (I don’t know what sites like WeBull and RH have) you get analyst reports that usually provide one year price targets. That’s not very useful if you’re really a long term investor because I care about 3,5,10 years from now but I suppose that’s one tool. Benzinga has analyst price targets when you search by individual ticker, too. Thefly.com as well. If you’re just trading, some people use technicals so learn those. Some (many) have no real plan at all. 

I sell when the reason I bought the company is no longer valid or growth slows to a point I’m better off elsewhere. 

[[icon] 10,138]

Speculative market on Steroids?

 

[quote]Are we in a bubble?

Good grief. We had the Fed change the duration of its balance sheet in 2000. Then we had the Fed change the composition of its balance sheet in 2020. The world’s most important central bank has in effect become a mutual fund, buying everything from commercial mortgage-backed securities (CMBS) to investment-grade credit to junk bonds. The average yield in the high-yield bond market is a record-low 4%, whereas even the lowest default rate you would ever see in the most robust of economic expansions would necessitate an interest rate closer to 6%. We are at 4% for an economy whose sole sources of vitality are vaccines and fiscal stimulus checks.

If HY bonds are mispriced, then all risk assets are mispriced, including equities. We have a situation on our hands where U.S. companies that make no money have seen their stock prices soar 19% year-to-date and outperform those which are profitable by 15 percentage points. Okay. Let’s not hurt anyone’s feelings and call it a bubble. Let’s call it a speculative market on steroids.

Here’s the evidence.

Valuation:

The CAPE smoothed P/E multiple has expanded for six straight months. It bottomed at 24.8 in March at the price index trough, closed December at 33.7, then to 34.5 in January, and now to 34.8 in February. By way of comparison, the multiple was 32.3 in March 2001, as the tech wreck bear market really got going; and 32.6 in September 1929. Investors always think they can get out before the peak is in. History rhymes.

Leverage:

Margin debt has soared 42% from a year ago (+115% at an annual rate over the past three months alone). This is exactly what the trend was in August 2007 and September 2000. Right near the market peaks.

Positioning:

The put-call volume ratio has been below 0.60 with near consistency since the middle of November. It’s a stretch we haven’t seen in over eight years. The BofA survey shows that global portfolio managers are running with the lowest cash levels in eight years, and have the highest exposures to equities and commodities in a decade.

Technicals:

As we published on Friday in Technicals with Dave, our technical chart work is still flashing green on the major averages. ‎That is all very near-term and can switch on a dime. For the traders out there: Our Strategizer models are advising caution and foreshadowing subpar returns on a twelve-month basis. All this means is that selling into the strength that we see ahead makes prudent sense. I should add that from my lens, the fact that the S&P 500 is now 13% above its 200-day moving average is an extreme gap worth noting and monitoring — it was 11% back in February 2000, just ahead of the tech mania bust and 7% in October 2018, ahead of the near-20% drawdown heading into the end of that year.

Sentiment:

What do 56 IPOs in less than two months (+180% YoY) at $21.4 billion (+331%) tell you? Or Bitcoin now with over $1 trillion of market value? Need I say more?
 

-------

 

I agree with David here. By all measures the markets are now in full bubble territory... Some of the markers I am looking at are:

Speculative option positions are highest on record.

Highest-ever volumes in pink sheet stocks.

Short interest is lowest on record.

Margin debt is highest on record.

Hedge fund gross exposure is highest on record.

Investor optimism is highest on record.

Mutual funds have the lowest cash position in history.

Everyone is all in.

That same reflation bet spills across into a record-short bond position, a record-short dollar position, record inflows into equities, record inflows into emerging markets, record inflows into commodities... the list goes on and on.

The question is whether the market is correct in taking these risks.

The economy is still probably trending at or below zero (the numbers will get screwy YoY for a while) due to huge insolvencies and a still restricted global economy; and structural unemployment is 6-10% (i.e., whether you include the Labor Force Participation rate or not) showing how bad the picture really is. Debts have been temporarily forgiven but not permanently, so those payments are yet to come, and a LOT of demand for durable goods and housing has been brought forward. There is a high chance of payback, and the economy can't survive without stimulus.

The risks are (1) the market trying to price in higher rates (but likely to be capped by the Fed or by more sluggish growth) and (2) a strong potential for the dollar to rise. Both causes upset the speculative reflation party. Or it can wither away if growth comes in weaker than expected. I err towards a rising dollar and weaker growth over time, once stimulus fades.

But, the question I am wrestling with is whether we are even using the right denominator for assets anymore. The massive money printing doesn't show up in CPI due to demographics, debt loads, deflation effects of technology, or globalisation; but it does show up in assets. I'm starting to play around with the idea that the right way to understand what is really going on is to change the denominator to the Fed balance sheet for US equities, or the G4 Central Bank Balance Sheets for global stocks. Since QE started in 2008, stocks have basically traded sideways (i.e., they have offset the balance sheet but have done no more than that).

Only technology stocks have outperformed the balance sheet since 2008 and that suggests that the tech trend is a secular trend, which also makes sense to me.

In gold terms, equities are fairly priced versus the long run average too.

Thus, I'm starting to think we are looking at 2 bubbles: a shorter-term bubble in reflation (that can be corrected by a sharp sell off), and the really big bubble that is distorting everything—central bank balance sheets. When viewed through those two lenses, everything since 2008 makes more sense. [/quote]
 

...

Edited March 10 by [icon]

[JAA 2,857]

9 hours ago, Bonfire said:

So if there are a zillion market order for RBLX at market open, how is it decided what order they are executed? 

On TD Ameritrade I just put in a limit order for 10 at $60.  Site said no market orders.

[JAA 2,857]

11 minutes ago, [icon] said:

Speculative market on Steroids?

 

Are we in a bubble?

Good grief. We had the Fed change the duration of its balance sheet in 2000. Then we had the Fed change the composition of its balance sheet in 2020. The world’s most important central bank has in effect become a mutual fund, buying everything from commercial mortgage-backed securities (CMBS) to investment-grade credit to junk bonds. The average yield in the high-yield bond market is a record-low 4%, whereas even the lowest default rate you would ever see in the most robust of economic expansions would necessitate an interest rate closer to 6%. We are at 4% for an economy whose sole sources of vitality are vaccines and fiscal stimulus checks.

If HY bonds are mispriced, then all risk assets are mispriced, including equities. We have a situation on our hands where U.S. companies that make no money have seen their stock prices soar 19% year-to-date and outperform those which are profitable by 15 percentage points. Okay. Let’s not hurt anyone’s feelings and call it a bubble. Let’s call it a speculative market on steroids.

Here’s the evidence.

Valuation:

The CAPE smoothed P/E multiple has expanded for six straight months. It bottomed at 24.8 in March at the price index trough, closed December at 33.7, then to 34.5 in January, and now to 34.8 in February. By way of comparison, the multiple was 32.3 in March 2001, as the tech wreck bear market really got going; and 32.6 in September 1929. Investors always think they can get out before the peak is in. History rhymes.

Leverage:

Margin debt has soared 42% from a year ago (+115% at an annual rate over the past three months alone). This is exactly what the trend was in August 2007 and September 2000. Right near the market peaks.

Positioning:

The put-call volume ratio has been below 0.60 with near consistency since the middle of November. It’s a stretch we haven’t seen in over eight years. The BofA survey shows that global portfolio managers are running with the lowest cash levels in eight years, and have the highest exposures to equities and commodities in a decade.

Technicals:

As we published on Friday in Technicals with Dave, our technical chart work is still flashing green on the major averages. ‎That is all very near-term and can switch on a dime. For the traders out there: Our Strategizer models are advising caution and foreshadowing subpar returns on a twelve-month basis. All this means is that selling into the strength that we see ahead makes prudent sense. I should add that from my lens, the fact that the S&P 500 is now 13% above its 200-day moving average is an extreme gap worth noting and monitoring — it was 11% back in February 2000, just ahead of the tech mania bust and 7% in October 2018, ahead of the near-20% drawdown heading into the end of that year.

Sentiment:

What do 56 IPOs in less than two months (+180% YoY) at $21.4 billion (+331%) tell you? Or Bitcoin now with over $1 trillion of market value? Need I say more?
 

-------

 

I agree with David here. By all measures the markets are now in full bubble territory... Some of the markers I am looking at are:

Speculative option positions are highest on record.

Highest-ever volumes in pink sheet stocks.

Short interest is lowest on record.

Margin debt is highest on record.

Hedge fund gross exposure is highest on record.

Investor optimism is highest on record.

Mutual funds have the lowest cash position in history.

Everyone is all in.

That same reflation bet spills across into a record-short bond position, a record-short dollar position, record inflows into equities, record inflows into emerging markets, record inflows into commodities... the list goes on and on.

The question is whether the market is correct in taking these risks.

The economy is still probably trending at or below zero (the numbers will get screwy YoY for a while) due to huge insolvencies and a still restricted global economy; and structural unemployment is 6-10% (i.e., whether you include the Labor Force Participation rate or not) showing how bad the picture really is. Debts have been temporarily forgiven but not permanently, so those payments are yet to come, and a LOT of demand for durable goods and housing has been brought forward. There is a high chance of payback, and the economy can't survive without stimulus.

The risks are (1) the market trying to price in higher rates (but likely to be capped by the Fed or by more sluggish growth) and (2) a strong potential for the dollar to rise. Both causes upset the speculative reflation party. Or it can wither away if growth comes in weaker than expected. I err towards a rising dollar and weaker growth over time, once stimulus fades.

But, the question I am wrestling with is whether we are even using the right denominator for assets anymore. The massive money printing doesn't show up in CPI due to demographics, debt loads, deflation effects of technology, or globalisation; but it does show up in assets. I'm starting to play around with the idea that the right way to understand what is really going on is to change the denominator to the Fed balance sheet for US equities, or the G4 Central Bank Balance Sheets for global stocks. Since QE started in 2008, stocks have basically traded sideways (i.e., they have offset the balance sheet but have done no more than that).

Only technology stocks have outperformed the balance sheet since 2008 and that suggests that the tech trend is a secular trend, which also makes sense to me.

In gold terms, equities are fairly priced versus the long run average too.

Thus, I'm starting to think we are looking at 2 bubbles: a shorter-term bubble in reflation (that can be corrected by a sharp sell off), and the really big bubble that is distorting everything—central bank balance sheets. When viewed through those two lenses, everything since 2008 makes more sense.
 

...

There is tremendous about of money and support in the market these days.  Its a huge business.  I believe this model lends itself to a lot of nobodies with a few bucks (like myself) buying 1m shares of triple-0 stocks hoping for tendies for all.

[JAA 2,857]

https://www.reddit.com/r/wallstreetbets/comments/m1s4gv/i_made_a_promise_to_some_friends_that_i_would_eat/

[JAA 2,857]

BB is 4% pre-market.  Im really on the fence of losing like 17% overall on my original long term BB (like 2-3 year hold) to gamble on GME for a quick buck.  The theory though would be to cash the GME tendies at >500 and then buy the dip of BB when it goes back down to $8.

[JAA 2,857]

FWIW Im already up 10% on BLDP thanks to resident stonk whisperer @Todem

[stbugs 3,484]

14 minutes ago, [icon] said:

Speculative market on Steroids?

 

Are we in a bubble?

Good grief. We had the Fed change the duration of its balance sheet in 2000. Then we had the Fed change the composition of its balance sheet in 2020. The world’s most important central bank has in effect become a mutual fund, buying everything from commercial mortgage-backed securities (CMBS) to investment-grade credit to junk bonds. The average yield in the high-yield bond market is a record-low 4%, whereas even the lowest default rate you would ever see in the most robust of economic expansions would necessitate an interest rate closer to 6%. We are at 4% for an economy whose sole sources of vitality are vaccines and fiscal stimulus checks.

If HY bonds are mispriced, then all risk assets are mispriced, including equities. We have a situation on our hands where U.S. companies that make no money have seen their stock prices soar 19% year-to-date and outperform those which are profitable by 15 percentage points. Okay. Let’s not hurt anyone’s feelings and call it a bubble. Let’s call it a speculative market on steroids.

Here’s the evidence.

Valuation:

The CAPE smoothed P/E multiple has expanded for six straight months. It bottomed at 24.8 in March at the price index trough, closed December at 33.7, then to 34.5 in January, and now to 34.8 in February. By way of comparison, the multiple was 32.3 in March 2001, as the tech wreck bear market really got going; and 32.6 in September 1929. Investors always think they can get out before the peak is in. History rhymes.

Leverage:

Margin debt has soared 42% from a year ago (+115% at an annual rate over the past three months alone). This is exactly what the trend was in August 2007 and September 2000. Right near the market peaks.

Positioning:

The put-call volume ratio has been below 0.60 with near consistency since the middle of November. It’s a stretch we haven’t seen in over eight years. The BofA survey shows that global portfolio managers are running with the lowest cash levels in eight years, and have the highest exposures to equities and commodities in a decade.

Technicals:

As we published on Friday in Technicals with Dave, our technical chart work is still flashing green on the major averages. ‎That is all very near-term and can switch on a dime. For the traders out there: Our Strategizer models are advising caution and foreshadowing subpar returns on a twelve-month basis. All this means is that selling into the strength that we see ahead makes prudent sense. I should add that from my lens, the fact that the S&P 500 is now 13% above its 200-day moving average is an extreme gap worth noting and monitoring — it was 11% back in February 2000, just ahead of the tech mania bust and 7% in October 2018, ahead of the near-20% drawdown heading into the end of that year.

Sentiment:

What do 56 IPOs in less than two months (+180% YoY) at $21.4 billion (+331%) tell you? Or Bitcoin now with over $1 trillion of market value? Need I say more?
 

-------

 

I agree with David here. By all measures the markets are now in full bubble territory... Some of the markers I am looking at are:

Speculative option positions are highest on record.

Highest-ever volumes in pink sheet stocks.

Short interest is lowest on record.

Margin debt is highest on record.

Hedge fund gross exposure is highest on record.

Investor optimism is highest on record.

Mutual funds have the lowest cash position in history.

Everyone is all in.

That same reflation bet spills across into a record-short bond position, a record-short dollar position, record inflows into equities, record inflows into emerging markets, record inflows into commodities... the list goes on and on.

The question is whether the market is correct in taking these risks.

The economy is still probably trending at or below zero (the numbers will get screwy YoY for a while) due to huge insolvencies and a still restricted global economy; and structural unemployment is 6-10% (i.e., whether you include the Labor Force Participation rate or not) showing how bad the picture really is. Debts have been temporarily forgiven but not permanently, so those payments are yet to come, and a LOT of demand for durable goods and housing has been brought forward. There is a high chance of payback, and the economy can't survive without stimulus.

The risks are (1) the market trying to price in higher rates (but likely to be capped by the Fed or by more sluggish growth) and (2) a strong potential for the dollar to rise. Both causes upset the speculative reflation party. Or it can wither away if growth comes in weaker than expected. I err towards a rising dollar and weaker growth over time, once stimulus fades.

But, the question I am wrestling with is whether we are even using the right denominator for assets anymore. The massive money printing doesn't show up in CPI due to demographics, debt loads, deflation effects of technology, or globalisation; but it does show up in assets. I'm starting to play around with the idea that the right way to understand what is really going on is to change the denominator to the Fed balance sheet for US equities, or the G4 Central Bank Balance Sheets for global stocks. Since QE started in 2008, stocks have basically traded sideways (i.e., they have offset the balance sheet but have done no more than that).

Only technology stocks have outperformed the balance sheet since 2008 and that suggests that the tech trend is a secular trend, which also makes sense to me.

In gold terms, equities are fairly priced versus the long run average too.

Thus, I'm starting to think we are looking at 2 bubbles: a shorter-term bubble in reflation (that can be corrected by a sharp sell off), and the really big bubble that is distorting everything—central bank balance sheets. When viewed through those two lenses, everything since 2008 makes more sense.
 

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I agree with you. Just look at all the discussion in here. Not that long ago it was mainly about good companies that people felt would increase because they were doing well. We’ve got two separate threads on penny stocks and CYDY. This thread is 90% GME. If that doesn’t worry you, nothing will.

The whole theory on GME/others and fighting hedge shorts seems to not jive as well with the overall short interest at all time lows. Seems that the margin interest may be more of the driver and that’s scary because any large dips get exacerbated. The market came roaring back because of stimulus and the hope that that just means more money coming into the market.

I also agree on tech and the secular trend. If people think that these companies aren’t going to be driving growth and big banks and oil will now be driving don’t get it. Sure things rotate because there’s always a herd but those are short term trends. As a long term investor and someone who was alive and working in software back during the dot com bubble, I can tell you that while I know there will be scores of EV and Genetics companies that die on the vine, they are a big part of the future and the dot com era was a time when valuations had nothing to do with reality. There are a lot of non-profitable or just becoming profitable tech companies, but back then there were way more non-revenue companies. It was early, early in the cycle. Tesla didn’t exist. Google wasn’t close to being a public company. The iPhone didn’t exist, heck the iPod didn’t exist until the market had already started its correction. Netflix was a mailing company and I can’t remember if they existed. Amazon was only a couple years public and didn’t have AWS or anywhere near the breadth of reach/sales. Anyone trying to tie the dot com bubble to the tech market today is way off base, they are not even remotely the same.

Anyway, just my thoughts on the long term market and short term, I have no clue.