6 ms·

And the stock market is unfazed. So now you know where most of that money (trillions of relief for Covid) trickled to. The financial markets. We basically print

by bawana 6y ago

And the stock market is unfazed. So now you know where most of that money (trillions of relief for Covid) trickled to. The financial markets. We basically printed money to assuage the fear and anxiety of the speculators to whom the world is beholden

three_seagrass 6y ago
Markets were expected worse (~16%), and strong Q1 earnings coupled with Fed pumping is why you have the uptick.
- koonsolo 6y ago
  Serious question: How do you know that markets were expecting 16%? Where do you read that?
  - three_seagrass 6y ago
    My wife has CNBC on in the background during the day while we WFH, which is where I saw them talking about it.
- treyfitty 6y ago
  Your position sounds valid, but i also want to point out that we're at a point where "expectations" matter. For one, you can see from the past that initial claims reports every thursday were often far in exceed above expectations, yet all but one Thursday had stock market rallies. Furthermore, stocks who missed Q1 earnings and provided or retracted guidance had their stocks increase the next trading day. So, to say the stock market jump today was a result of 14.7% unemployment rate vs the expected 16% is an unfounded assertion. Could it be that it's because US-China tensions have allegedly eased? Could it be that oil jumped 4.5% today and is likely to have given investors faith that demand for oil is increasing? Or could it be a bunch of other things at once? I don't think it's fair to distill the stock market to just one outcome anymore. There's too much going on at once.
  - three_seagrass 6y ago
    I never claimed there was a single factor, but the better-than-expected unemployment was a large one.
trcollinson 6y ago
I keep hearing comments like this yet no real indication of what we should do instead of having the market the way we do. I have a lot of my personal wealth (which is not a substantial number compared to a lot of investors) tied up in two areas. One of those is the stock market (the other is real estate). Most of that is tied to index funds because the returns are good. 401K's and retirement accounts is basically where it is. I would imagine many of those who have any savings in the US are in the same place. So, a few things. First, as a small time investor that has a good chunk of my future tied up in the US stock market, I certainly would not say that the stock market has been unfazed over the last few months. It has been quite up and down. I am glad it stabilized a bit so that this report didn't tank it. Second, I am glad that the Fed did something to assuage the fears of the market. Remember my future, and many millions of other peoples futures, are tied up in that market. Finally, let's stop making this out as if there are a few good ole boys sitting in a back room moving the market around while they drink scotch and smoke cigars and that they suddenly get nervous and start ruining everything. The finance market has some really brilliant people working in it and trying very hard to make money. What is the negative there? I think of it as a symbiotic relationship. So, if you disagree with the market and how we are all beholden to speculators, what exactly do you suggest we do?
- Ididntdothis 6y ago
  I think you are expressing the problem. The market doesn’t reflect economic reality but instead there are a lot of people who need the markets to stay up so their future is secure.
  - nickff 6y ago
    We are all dependent on a variety of complex systems to maintain our standard of living; the stock market is just one of those systems, and it is one of the most highly-visible, and widely reported.
  - lotsofpulp 6y ago
    How is that not reality?
reactor 6y ago
No, https://slate.com/business/2020/03/federal-reserve-bond-market-wall-street-trillion.html https://slate.com/business/2020/03/federal-reserve-bond-mark... explains well.

by bawana 6y ago

three_seagrass 6y ago

Markets were expected worse (~16%), and strong Q1 earnings coupled with Fed pumping is why you have the uptick.

koonsolo 6y ago
Serious question: How do you know that markets were expecting 16%? Where do you read that?
- three_seagrass 6y ago
  My wife has CNBC on in the background during the day while we WFH, which is where I saw them talking about it.
treyfitty 6y ago
Your position sounds valid, but i also want to point out that we're at a point where "expectations" matter. For one, you can see from the past that initial claims reports every thursday were often far in exceed above expectations, yet all but one Thursday had stock market rallies. Furthermore, stocks who missed Q1 earnings and provided or retracted guidance had their stocks increase the next trading day. So, to say the stock market jump today was a result of 14.7% unemployment rate vs the expected 16% is an unfounded assertion. Could it be that it's because US-China tensions have allegedly eased? Could it be that oil jumped 4.5% today and is likely to have given investors faith that demand for oil is increasing? Or could it be a bunch of other things at once? I don't think it's fair to distill the stock market to just one outcome anymore. There's too much going on at once.
- three_seagrass 6y ago
  I never claimed there was a single factor, but the better-than-expected unemployment was a large one.

trcollinson 6y ago

I keep hearing comments like this yet no real indication of what we should do instead of having the market the way we do. I have a lot of my personal wealth (which is not a substantial number compared to a lot of investors) tied up in two areas. One of those is the stock market (the other is real estate). Most of that is tied to index funds because the returns are good. 401K's and retirement accounts is basically where it is. I would imagine many of those who have any savings in the US are in the same place. So, a few things. First, as a small time investor that has a good chunk of my future tied up in the US stock market, I certainly would not say that the stock market has been unfazed over the last few months. It has been quite up and down. I am glad it stabilized a bit so that this report didn't tank it. Second, I am glad that the Fed did something to assuage the fears of the market. Remember my future, and many millions of other peoples futures, are tied up in that market. Finally, let's stop making this out as if there are a few good ole boys sitting in a back room moving the market around while they drink scotch and smoke cigars and that they suddenly get nervous and start ruining everything. The finance market has some really brilliant people working in it and trying very hard to make money. What is the negative there? I think of it as a symbiotic relationship. So, if you disagree with the market and how we are all beholden to speculators, what exactly do you suggest we do?

Ididntdothis 6y ago
I think you are expressing the problem. The market doesn’t reflect economic reality but instead there are a lot of people who need the markets to stay up so their future is secure.
- nickff 6y ago
  We are all dependent on a variety of complex systems to maintain our standard of living; the stock market is just one of those systems, and it is one of the most highly-visible, and widely reported.
- lotsofpulp 6y ago
  How is that not reality?

reactor 6y ago

No, https://slate.com/business/2020/03/federal-reserve-bond-market-wall-street-trillion.html https://slate.com/business/2020/03/federal-reserve-bond-mark... explains well.