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Thread: FireWeatherMet Account Talk

  1. #1045

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    Default Re: FireWeatherMet Account Talk

    I actually want to be wrong on this, but I am not putting my money on it...

    I would much rather be invested then camping in cash and losing to inflation - guaranteed.

    I tried to hold firm. I lost unrealized gain during the Obama Presidency. I did not want to do that again.

    I have no confidence in any of these goobers. I also have little confidence in investors. We have yet to see panic capitulation.

    Anyway, I think I'll just watch.
    Lookin' up at the 'G Fund'!!!

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  3. #1046

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    Default Re: FireWeatherMet Account Talk

    Post duped
    Lookin' up at the 'G Fund'!!!

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  5. #1047

    Default Re: FireWeatherMet Account Talk

    Quote Originally Posted by Boghie View Post
    I actually want to be wrong on this, but I am not putting my money on it...

    I would much rather be invested then camping in cash and losing to inflation - guaranteed.

    I tried to hold firm. I lost unrealized gain during the Obama Presidency. I did not want to do that again.

    I have no confidence in any of these goobers. I also have little confidence in investors. We have yet to see panic capitulation.

    Anyway, I think I'll just watch.
    You're right about being in cash while inflation is running high. But 1 thing I've found thru research of past decades is that inflation usually rises when the economy is doing well (aka last years super GDP of 5-6%).
    Its actually rare to have high inflation with economic downturns, remember 2008-2009 when inflation was super low or actually negative?
    The "Stagflation" of 1973-1982 was a major exception, but even there, from 1975-1979 our GDP was high those years (No Recession) but just rising inflation.
    The 1st 6 months of this year tried to mimic that, and you're right its worthy of fear.
    If Oil had continued going slowly up, or just leveled off at $130/barrel, then I would be probably hiding on the -G- Lillypad most of the time.
    If supply chains were continuing to have major issues, I would also be wary of stocks.
    But both those things have improved a lot...we see it every time we pull up to the pumps and its 40-50 cents/gal cheaper than just 6 weeks ago.
    Ukraine War also has taken a pause...with no major issues affecting us from there, that haven't already been baked in back in Feb-Mar.
    Also China loosening its super restrictive "No Covid" policy, helping supply chains.
    These are basically 99% of what's caused the huge Inflation Spike across the globe (not just the US).

    The big thing I try to remember, is that whenever we have major socio-economic issues, and there is a turning point in what caused them....that's when the BIGGEST gains usually occur.
    Like March 2009, when Bernanke/Geithner/Summers took all uncertainty out of the "Toxic Real Estate Assets", Bank Failures, GM failing, by announcing an agreed upon plan to prop all 3 up.
    Some people didn't like that from a political point of view, but you have to keep political bias OUT of investing, because back then that decision to save the banks, the auto industry, as keep millions of people from losing their homes by allowing restructuring of loans, told the beat down markets that its full steam ahead,, even though hundreds of thousands of jobs were still being lost for several more months, the market looking 6 months forwards, saw that the worst was behind them.

    I was just starting investing on my own back then, on this site. I was watching a lot of CNBC and Fox Business News. Saw a major conflict between Cramer and his CNBC cohorts calling March 2009 "The Bottom" vs FBN, loaded with gals with shapely exposed legs, and not much market knowledge, constantly saying "The Other Shoe Is About To Fall".
    That kept me out of stocks part of 2009, 2010 even 2011. I slowly realized FBN was highly partisan, and would not acknowledge any good economic news, as long as a Democrat was in the WH, whereas CNBC and Bloomberg talk more "price" regardless of what the political climate is.
    I started a thread several years back here somewhere titled "Fox Business News Sucks" based largely on that experience, so that's why you'll see me refer to that, tongue in cheek, from time to time.

    As for "capitulation", if a 30%+ drop (nearly a 3rd of the total market value) in just 6 months isn't capitulation, I don't know what is.
    Especially falling that much while we're still gaining millions of jobs, and unemployment rate remains near historic lows.

    Definitely not saying we're out of the woods for good, just probably thru August. Then in Sep we'll have to see how oil, price at the pumps, and monthly inflation numbers are trending.
    Will Russia do something crazy, like use tactical nukes because their getting their a$$es kicked, or fire on US ships transporting LNG to Europe?
    Will OPEC suddenly reverse course and pump LESS Oil?
    Will Monkey Pox prove more contagious, or a new, worse strain of COVID emerge?
    Will US job growth suddenly end, and we start losing lots of jobs?
    Any of these, or a combo, could send us into panic selling and a new low.
    But minus this, then we're very likely to trend higher thru the end of the year...IMHO.
    Until of course, all those too stubborn to go into stocks early, finally start stampeding in, then its worth keeping an eye on our Sentiment Survey, which could warn us of a possible massive profit-taking sell-off.

    Have a good weekend Boghie.
    CURRENTLY 100% G (as of COB 03/18/2024) 1st March IFT

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  7. #1048

    Default Re: FireWeatherMet Account Talk

    As we close out the week (and the month of July), trying to stay humble and nimble, and re-evaluate what my short term "tactical" approach for Aug will be.
    Charts below showed where we were, and what my thoughts were 8 days ago (top chart) and where we ended up (bottom chart).
    As expected we not only shot up to fill the upper gap, but alo blew past it and past another potential barrier, Oscar Carboni's favorite, the 100 EMA (even though he refuses to label it, as if we can't figure it out-lol)

    So the question is, how far to ride this wave?
    Well, my system is to hit a few "singles" early in the year to get ahead of the major indices by at least 1-2 percent, then basically stay put (invested) unless a clear topping pattern presents itself for another good exit in order to re-enter at a lower price. without getting too greedy.
    So the next 2 potential barriers that could put a temporary pause to the upward trend, are the 1) 50% retracement (black line) between the recent all time high and the recent low. You can see we are only about 1 percent away from that if things close as is at 1pm.
    The other is the 200 EMA which is still about 5-6% higher from here.

    Will chew on it a bit this weekend, and at the very least I like the feeling about going fully invested (50/50 C & S) into a new month. Because even if I decide to exit at the 50% retracement upon another big up day Mon-Tue, that would still give me a 1% gain for Aug, and allow me a 2nd IFT to get back into stocks if we dip slightly.
    And unless the price of Oil, or some other economic indicator like jobs, changes drastically, I think any drop of the 50% retracement would be shallow (1-3%) before we go up further to test the 200 EMA.
    One thing for sure, the recent rise in no way resembles a "Bear Flag Rally" that we've seen in previous months, both the slope and choppiness are different this time, because, well, large macro-economic conditions are different (unless one believes FBN-lol).
    So for those thinking of going in right now, my advice would be...DON'T...at this point. Remember that Wall St story about Bulls...Bears...and Pigs. Wait to see a 2-3 day pullback.
    But don't wait much more than that, because then you run the risk of the train leaving the station at breakneck speed, without you...IMHO.

    SP.jpg
    CURRENTLY 100% G (as of COB 03/18/2024) 1st March IFT

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  9. #1049

    Default Re: FireWeatherMet Account Talk

    Tom made a very interesting point about 2 days ago regarding how strong "Bear Market Rallies" can get....looking at 2008.
    Now before anyone says 'Well, that was on a totally bigger scale" lets compare 2008 to 2022.
    You'll see that the "initial" fall from the late 2007 highs into early 2008 was only near 20% on the S&P...while our decline this year was near 25% (see charts below).


    SP 2008.jpg
    SP.jpg

    You'll notice that in 2008 from March to June SP surged all the way up to to and past, the 200 MA. This was while we were in a "REAL" recession, losing nearly 200,000 jobs a month (as opposed to GAINING 300,000-500,000/month currently this year).
    The reason for this surge, might have had less to do with areas of resistance, but more to do with big events ongoing. I researched some Financial Crisis Timeline history, and it seems that rate hikes and Bear Stearns spooked the market thru early 2008.
    However, Paulsen kept assuring people that everything was under control...and the market liked it so much it went on a big 3 month tear. But late June rumors started that Fannie & Freddie were in trouble.Paulsen then said they might need to be bailed out, and that set the "Bear Rally Top".
    More info on the "Toxic Assets" in our Banking system did the rest of the sinking late summer into fall. https://www.thebalance.com/2008-fina...meline-3305540

    So now back to 2022 (the 2nd chart above). The big fear this year is INFLATION. However the 30% drop in gasoline prices has simultaneously translated into most other commodities (see chart below).
    Matter of fact, the only real chart you need is the one below...it basically tells you INFLATION HAS PEAKED and that we should start seeing that in monthly CPI reports shortly. Even Real Estate has cooled significantly.
    Gasoline prices have fallen a record number of days in a row, and down nearly a dollar from early summer. If you haven't noticed that, you've been living in a cave. A "Bear" cave-lol.
    As for the FED, their next meeting isn't until Sep 21st, so they have nearly 7 weeks to see if inflation starts significantly slowing. This is fueling our spectacular bear Market Rally, and should continue into the 1st half of Sep.
    We do get another inflation number this Wednesday I think, so that could be a brief "Sell the News" day, esp if its still not showing a decent drop-off.

    So back to the 2022 S&P Chart above...if inflation is "Risk Off" for now, and the market is loving it...how far up can we go?
    If 2008 is a "Risk Off" example from March-July...it seems at a minimum, the 200 Moving Avg. That's about 5% higher from here on the S&P.
    Its even more of a rise on the Small Caps (below) about 11% higher from here.

    S-Fund.jpg

    You might have notices that the S has been a laggard for 2021 into June 2022 but in the last 6 weeks it has vastly outperformed the C.
    My system calls for me to stay ahead of all the indices and when I go into stocks I go into the top stock fund for the year (still the C).
    But in late July when I went back into equities, instead of going all C, I went 50/50 C and S, since the S was starting to have some really big up days...and might raise that ratio soon.
    And so far no regrets. Even on a day like today when the C took a brief breather and went slightly negative the S was up near 0.80% so I still made nearly half of that again today.
    So far for 2022 My goal of staying ahead of all the funds is working out...about 5% ahead of F...8% ahead of C...14% ahead of S. If only I knw back in January that the -G- was the fund to beat!
    My system actually is "screaming at me" to not make another IFT for the rest of the year. I should listen, but probably will muck it up (lol).

    So anyway, I am planning to stay in stocks about 90% of the time between now and late September, aiming for at least the 200 day EMA, and just like 2008 showed, a bit of an overshoot above that.
    But the price of Oil is key...as are world events that could disrupt it. As long as it stays steady or slowly falls, we should be in good shape on the inflation front...which means good shape on the Fed front.
    And since new Jobs number shows the economy is doing well, and the Atlanta Fed prediction of positive GDP for 3rd Qts 2022 means even Recession could be off the table...maybe the "Goldilocks Soft Landing" might be reached after all (maybe if the Fed doesn't stomp on it).


    THE ONLY CHART YOU REALLY NEED (below)

    Commodites.jpg

    Last edited by FireWeatherMet; 08-08-2022 at 07:11 PM.
    CURRENTLY 100% G (as of COB 03/18/2024) 1st March IFT

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  11. #1050

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    Default Re: FireWeatherMet Account Talk

    If inflation subsides to 4% - 5% the FED will back off.

    If it accelerates they will hammer it.

    The FED's main job is to ensure the integrity of the U.S. dollar. To do so they want a 2% inflation rate. Deflation is the worse of all worlds, rapid inflation (say over 8%, just guessing) is the next worse, and inflation greater than something like 5% can be handled softly. While external events always play a role, the FED responding to inflation and the devaluing of the dollar is expected and will have an affect. I think the next inflation (CPI) rate comes out tomorrow.
    Lookin' up at the 'G Fund'!!!

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  13. #1051

    Default Re: FireWeatherMet Account Talk

    Quote Originally Posted by Boghie View Post
    If inflation subsides to 4% - 5% the FED will back off.

    If it accelerates they will hammer it.... I think the next inflation (CPI) rate comes out tomorrow.
    Interesting points and I agree with what would happen in either scenario but I do have to ask...WHAT IN THE WORLD MAKES ANYONE THINK INFLATION IS GOING TO ACCELERATE?

    Here are the biggest inflation influencers (below) and they are all telling us that if there is going to be any acceleration to Inflation...it will be acceleration to the DOWN-side.
    If anyone waits until inflation gets down to 4-5% before getting into stocks, that could be 6-12 months down the road and we would probably be at a new high on the S&P, 20% higher from now...and at that point any further gains would be slow.
    The only way to make money, is to "Read the tea-leaves" which aren't even that subtle...they are SCREAMING pretty loudly (again below).

    Commodites.jpg
    CURRENTLY 100% G (as of COB 03/18/2024) 1st March IFT

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  15. #1052

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    Default Re: FireWeatherMet Account Talk

    A friend of mine was telling me about how the housing market is falling hard again. I don't pay attention much since our will be paid off in a year and we don't look at a house as an investment. He bought a new house one year ago at the highs and I doubt the home is valued at what he paid for it. So yeah, housing going going down will be very deflationary. Big picture, deflation is the bigger threat as technology becomes even bigger parts of our lives.

    Two problems I see coming are thanks to this "inflation reduction bill".

    There is nothing earmarked for oil and gas. Oil and gas are like cigarettes, despite "everybody knowing how dangerous they are", they both will linger on for many years to come. The difference is, while we can live without cigarettes if they disappeared tomorrow, we couldn't do without a 10% reduction in oil/gas production. Say what you want, but we'll NEVER power AC units, cars, stoves, hot water tanks and furnaces with any technology we currently know of (sun, wind). It's a false hope.

    Second, taxes will be raised on utilities to pay for this mess. Since utilities have to make enough to pay for their assets, it comes down to prices going up for electric and gas utilities.

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  17. #1053

    Default Re: FireWeatherMet Account Talk

    CURRENTLY 100% G (as of COB 03/18/2024) 1st March IFT


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  19. #1054

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    Default Re: FireWeatherMet Account Talk

    It was a good day.
    May the force be with us.

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  21. #1055

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    Default Re: FireWeatherMet Account Talk

    No complaints here

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  23. #1056

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    Default Re: FireWeatherMet Account Talk

    Gasoline futures much lower than the national average. ($3.05 vs $4.01) Even with gas taxes, that's a big discrepancy with possible lower gas prices at the pump coming in the weeks or months ahead.

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