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Joe Kennedy supposedly said he avoided the stock crash of 1929 by getting out of the market when his shoeshiner started giving him stock tips. Multiple times r

Joe Kennedy supposedly said he avoided the stock crash of 1929 by getting out of the market when his shoeshiner started giving him stock tips. Multiple times recently I’ve been at restaurants recently overhearing people talk about how much money they’re going to make in Bitcoin. It’s hard to convey here, but the make-money-who-cares-how-it’s-magic came across every time in such a wow-this-is-definitely-a-bubble way. But as they say, markets can remain irrational longer than you cane remain solvent.

hellofunk 9y ago
As far as the stock market goes, sentiment has not yet reached a peak. There are still a lot of what I call the "wise naysayer" on CNBC and elsewhere, claiming that we are due for a big decline, or even a crash. Until there are no naysayers left, the chances of further climbs is supported by sentiment analysis.
- deleted 9y ago
  [deleted]
- lend000 9y ago
  I love that this comment was down-voted because it so ironically conveys how accurate sentiment analysis is -- i.e. the masses reject it.
  - hellofunk 9y ago
    Exactly.
- danmaz74 9y ago
  In every single crash I know of there were lots of naysayers up until the actual crash. As a matter of fact, right after each crash I personally remember, there were some of those naysayers who got elevated to oracle-status by the press for a time, "the one who had foreseen this all". But they always failed to predict the timing of the next crash, so oracle-status didn't last. Bottom line: still having naysayers isn't a relevant signal. Predicting that there will be a crash is easy (you are almost guaranteed to be eventually right). Predicting WHEN the crash will be is (almost?) impossible.
- jgalt212 9y ago
  I agree stocks are rich/richish by most metrics, but still cheaper than bonds/real estate. And the latter have very strong negative correlation to the level of interest rates. Plus, private equity is sitting on close to $1T of dry powder. That's a pretty strong back stop to stock prices. In short, to avoid the crash you need to figure out what causes mass PE withdrawal, and get in front of that. https://www.bloomberg.com/news/articles/2017-09-01/why-private-equity-has-963-billion-in-dry-powder-quicktake-q-a https://www.bloomberg.com/news/articles/2017-09-01/why-priva...
  - timr 9y ago
    "I agree stocks are rich/richish by most metrics, but still cheaper than bonds/real estate. And the latter have very strong negative correlation to the level of interest rates." Bond prices go down. Yields go up.
    - jgalt212 9y ago
      Yield spreads are at extremely rich levels. happy now?
      - deleted 9y ago
        [deleted]
mathattack 9y ago
The Palo Alto equivalent (which I've seen) is "the bartender gives 3D printing pitches"
deleted 9y ago
[deleted]
tomjen3 9y ago
If you only invest what you can lose, it doesn't matter how long the market is irrational. Bitcoin is a high risk investment/volatile in the short term, but the question is what is it long term? You put your money in btc and they may crash 30% in a day. If you panic then you lose money.
- quickben 9y ago
  Not sure what's with the downvote, but you are in essence right about going long. "Markets can remain irrational a lot longer than you and I can remain solvent." As for BTC, approach with caution, short or long.
  - tomjen3 9y ago
    HN has has a segment who are violently anti BTC, and so will downvote anything not critical to it.
tryingagainbro 9y ago
I am all out of stocks, put all my money on blockchain companies, as per an Uber drivers' advice. Apparently it is the future.
hkmurakami 9y ago
Mid 2000s was about flipping houses. Do we have seminars at Marriott courtsides pitching bitcoin yet?
- deleted 9y ago
  [deleted]
- dangoor 9y ago
  I searched for "bitcoin seminar" and was not disappointed: https://www.eventbrite.com/e/bitcoin-investmentwhat-how-when-where-why-tickets-36699969597# https://www.eventbrite.com/e/bitcoin-investmentwhat-how-when...

hellofunk 9y ago

As far as the stock market goes, sentiment has not yet reached a peak. There are still a lot of what I call the "wise naysayer" on CNBC and elsewhere, claiming that we are due for a big decline, or even a crash. Until there are no naysayers left, the chances of further climbs is supported by sentiment analysis.

deleted 9y ago
[deleted]
lend000 9y ago
I love that this comment was down-voted because it so ironically conveys how accurate sentiment analysis is -- i.e. the masses reject it.
- hellofunk 9y ago
  Exactly.
danmaz74 9y ago
In every single crash I know of there were lots of naysayers up until the actual crash. As a matter of fact, right after each crash I personally remember, there were some of those naysayers who got elevated to oracle-status by the press for a time, "the one who had foreseen this all". But they always failed to predict the timing of the next crash, so oracle-status didn't last. Bottom line: still having naysayers isn't a relevant signal. Predicting that there will be a crash is easy (you are almost guaranteed to be eventually right). Predicting WHEN the crash will be is (almost?) impossible.
jgalt212 9y ago
I agree stocks are rich/richish by most metrics, but still cheaper than bonds/real estate. And the latter have very strong negative correlation to the level of interest rates. Plus, private equity is sitting on close to $1T of dry powder. That's a pretty strong back stop to stock prices. In short, to avoid the crash you need to figure out what causes mass PE withdrawal, and get in front of that. https://www.bloomberg.com/news/articles/2017-09-01/why-private-equity-has-963-billion-in-dry-powder-quicktake-q-a https://www.bloomberg.com/news/articles/2017-09-01/why-priva...
- timr 9y ago
  "I agree stocks are rich/richish by most metrics, but still cheaper than bonds/real estate. And the latter have very strong negative correlation to the level of interest rates." Bond prices go down. Yields go up.
  - jgalt212 9y ago
    Yield spreads are at extremely rich levels. happy now?
    - deleted 9y ago
      [deleted]

mathattack 9y ago

The Palo Alto equivalent (which I've seen) is "the bartender gives 3D printing pitches"

deleted 9y ago

[deleted]

tomjen3 9y ago

If you only invest what you can lose, it doesn't matter how long the market is irrational. Bitcoin is a high risk investment/volatile in the short term, but the question is what is it long term? You put your money in btc and they may crash 30% in a day. If you panic then you lose money.

quickben 9y ago
Not sure what's with the downvote, but you are in essence right about going long. "Markets can remain irrational a lot longer than you and I can remain solvent." As for BTC, approach with caution, short or long.
- tomjen3 9y ago
  HN has has a segment who are violently anti BTC, and so will downvote anything not critical to it.

tryingagainbro 9y ago

I am all out of stocks, put all my money on blockchain companies, as per an Uber drivers' advice. Apparently it is the future.

hkmurakami 9y ago

Mid 2000s was about flipping houses. Do we have seminars at Marriott courtsides pitching bitcoin yet?

deleted 9y ago
[deleted]
dangoor 9y ago
I searched for "bitcoin seminar" and was not disappointed: https://www.eventbrite.com/e/bitcoin-investmentwhat-how-when-where-why-tickets-36699969597# https://www.eventbrite.com/e/bitcoin-investmentwhat-how-when...