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lombardo

Why do stocks keep going up when so many experts say it's the end of the cycle?

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If they are not buying then who is?

There are so many experts in the world of economics and finance who are warning that we are near the end of the economic cycle and that a recession is on the horizon. E.g. Ray Dalio is the head of the biggest hedge fund in the world and he has been vocal about an impending crisis.

 

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1 hour ago, winkie said:

Goes up until it goes down... Like property and insurance everything a gamble... Such is life. 😉

But the difference with property is that there aren't so many "experts" predicting a crash. Property is however stalling.

If it isn't the big investors who are moving the market then who is? It could be that they are speculating for the short trem before selling within a couple of years.

Edited by lombardo

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34 minutes ago, lombardo said:

But the difference with property is that there aren't so many "experts" predicting a crash. Property is however stalling.

If it isn't the big investors who are moving the market then who is? It could be that they are speculating for the short trem before selling within a couple of years.

Property in some places is over valued, in other places under valued......places where there is security, safty and has everything a human could want and more, an abundance of food, free wind, solar and water energy, clean air.....very highly populated areas will have to compete for a lack of natural resources.....bricks, concrete and shopping very expensive.....freedom means can move to better places for less, more space and a better way of life = a longer life of better quality.😉

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1 hour ago, lombardo said:

But the difference with property is that there aren't so many "experts" predicting a crash. Property is however stalling.

If it isn't the big investors who are moving the market then who is? It could be that they are speculating for the short trem before selling within a couple of years.

The market is moving the market.

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1 minute ago, Si1 said:

The market is moving the market.

You paid HOW MUCH!......must be planning to live there a while......you don't buy a car for how much it can make you, it is what it can do for you, sometimes paying far too much for some bricks will make more in prosperity/growth than it will make by just holding it.......sometimes it will lose in more ways than one = a total disaster.;)

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As long as borrowing money remains cheap, asset prices are going to go up - especially as companies take to borrowing money to buy their own stock back to boost prices and executive bonuses.

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10 minutes ago, Sour Mash said:

As long as borrowing money remains cheap, asset prices are going to go up - especially as companies take to borrowing money to buy their own stock back to boost prices and executive bonuses.

Haven't we been here before.;)

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On ‎07‎/‎05‎/‎2019 at 13:18, lombardo said:

If they are not buying then who is?

Almost everyone with money is buying. If you have a DC pension you're probably buying every month unless you've chosen a very risk averse approach. Dollar cost averaging is a good strategy, so most people should be buying.

There are things like a recession on the horizon, but this and various other issues are always lurking, yet equities outperform other asset classes and give good returns in the majority of years. We have a lot of worries now, but this was the case in previous bull markets.

 

On ‎07‎/‎05‎/‎2019 at 13:18, lombardo said:

There are so many experts in the world of economics and finance who are warning that we are near the end of the economic cycle and that a recession is on the horizon. E.g. Ray Dalio is the head of the biggest hedge fund in the world and he has been vocal about an impending crisis.

 

 

I knew who he was, but never really knew much about him, so I just searched and this was the first thing I looked at:

https://observer.com/2019/05/ray-dalio-bridgewater-investing-tips-reddit-ama/

Ray Dalio’s Brutally Honest Tip: Amateur Investing Is Harder Than the Olympics

By Sissi Cao05/08/19 11:57am
 
It appears he's bullish, having just reduced his estimate of a probability of an impending recession, so I'm not sure you're right about him and the impending crisis.
 
 
 

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On ‎07‎/‎05‎/‎2019 at 15:25, lombardo said:

But the difference with property is that there aren't so many "experts" predicting a crash.

I think the difference with property is that you can't short it. Others might say the difference is that for a mixture of reasons (mostly security and culture) most people will seek to buy rather than wait at all prices. So most buyers either buy at any price or speculate that prices will go higher. Investors in equities are a lot more discerning and speculators can bet prices will fall.

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On 07/05/2019 at 13:18, lombardo said:

If they are not buying then who is?

 

Often the company themselves via share buy backs.

Everyone is doing it and the result will be a lot of share prices that keep increasing until the banks decide to stop throwing money at them.

It's one reason I'm still bullish about AAPL, they can keep on releasing flawed products and losing market share for years to come but they have enough hard cash already to just keep on buying their own shares.

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Pension funds buy willy. 

The problem is prices rise just before a collapse. Market manipultors just outright lie:""buy the dips." Are markets increasingly volatile? Yes. Sure sign of edginess. 

There will be no warning. There will be a concerted effort to say "buy"  just as avalanche begins: how else to cash out, you need buyers to sell to.? 

Stock valuations are insane: run.

Ianafa; dyor.  

 

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17 minutes ago, 24gray24 said:

Pension funds buy willy. 

The problem is prices rise just before a collapse. Market manipultors just outright lie:""buy the dips." Are markets increasingly volatile? Yes. Sure sign of edginess. 

There will be no warning. There will be a concerted effort to say "buy"  just as avalanche begins: how else to cash out, you need buyers to sell to.? 

Stock valuations are insane: run.

Ianafa; dyor.  

 

Yep, I'm now a cynical old git when it goes to stockmarket talk. I've lived 2 real cycles, though I also remember 1988/9 as a kid. Indeed, during dot.com I made a year's salary at the time in 2 weeks, only to blow it. So yes, late-stage markets can be adrenaline-filled, but it is then easy to blow up.

With my wiser 45-year-old head, I have now put my pension fund into cash and some corporate bonds back in October, got out just before the fall that month.

Now, if I had 100% perfect timing, I'd have perhaps bought back in around early November, but actually my fund has risen since then due to interest and coupon payments, plus I actually exited with Sterling at $1.25, it is now $1.30, so in practice I wouldn't have gained much from the market recovery since November.  The Dow is now only 600 points more than when I sold and I'd have lost 5% on the exchange rate shift and interest missed.

When the fall happens it is going to be fast and furious. That is never the time to sell. I'm just waiting, if there is a 30% fall (quite likely in my mind), then I'll think about getting back in.

At that point my pension is pretty much done, as with likely 12 years until I can technically touch it, there is no way I'm going to miss the lifetime earnings allowance. I've now moved to putting money into ISAs and Gold.

 

Edited by Mikhail Liebenstein

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On 08/05/2019 at 23:39, Habeas Domus said:

Often the company themselves via share buy backs.

Everyone is doing it and the result will be a lot of share prices that keep increasing until the banks decide to stop throwing money at them.

It's one reason I'm still bullish about AAPL, they can keep on releasing flawed products and losing market share for years to come but they have enough hard cash already to just keep on buying their own shares.

Yes that's my understanding, too, all the cheap money means companies are propping up their own share prices*. As for 'until the banks decide to stop throwing money at them', yes, and won't that (genuine question) only stop when governments stop throwing money at the banks? And is that EVER going to happen?!!

*edit: and they're doing that because high-ups' salaries/bonuses are often linked to the company's 'value'.

Edited by North London Rent Girl
forgot an important bit

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I'm buying and will continue to do so till I retire. No point trying to time the market just time in the market. Rebalance and invest regularly Look at the recently revived HPC threads from 2004 so see how trying to time the market worked out for them! The market can remain irrational longer than ones lifetime or ability to remain solvent.

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3 minutes ago, Captain Kirk said:

Something to do with QE and cheap money.

Cheap created money that is not spent living day to day requires a home....soon there will be other payment means and that will upset the apple cart.... what then will be value when of little value? 😉

 

 

 

 

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  • 311 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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