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welcome to the L-shaped recession. welcome to the secular bear market. a secular bear market periodically shows amazing % gains in stocks, but always ending dow
by p0ltergeist 18y ago
welcome to the L-shaped recession. welcome to the secular bear market. a secular bear market periodically shows amazing % gains in stocks, but always ending down. look at the dow in the 30s, the nikkei in the 90s (and now)...even cyclical gains of 100% or more could not stem the larger down trend
forget all this garbage of now being a great time to max out ten credit cards to build a website. there is only one rule for secular bear markets - preserve wealth. there is no value in planting in an economic winter. don't fight it, wait for an economic spring to appear in the economy and have capital ready for a more appropriate climate. we have years to go. this will end only when all excess debt is deleveraged and governments, consumers and companies alike have healthier balance sheets purged of debt.
- josefresco 18y agoWelcome to Hacker News p0ltergeist and thanks for your comment. No value in planting in an economic winter? Doesn't that conflict with 'buy low sell high' principle? If you wait too long for the spring, you end up paying too much. /not an expert, has mucho debt
- p0ltergeist 18y agoNo value in planting in an economic winter? Doesn't that conflict with 'buy low sell high' principle? no. the dow is going to 5000 (but will likely go to 12000 first) . that is a better time to consider "planting". furthermore oil is going to go over $200 and t-notes will yield 20% before this is all over, because what we are doing now is planting the seeds for hyperinflation (to follow our current deflation) with all of this "50 billion here, 100 billion there, 700 billion here" money printing.
- swombat 18y agoI hope you have some good solid spread betting going on to clean out when all your predictions come true. Oh, you don't? You mean these are just in-the-air?
- Zaak 18y agoThat's a good point. If you really do know what's going to happen, there's almost certainly a way you can profit from it.
- p0ltergeist 18y agoi do and i will
- david927 18y agoThat's interesting you say that, because while I feel I've seen this coming (and have annoyed people for years to get into metals), at the same time, I'm not confident at all with exactly how it will all pay out. My gut says that if it's paper, it's worth paper. But really, I don't know.
- p0ltergeist 18y agonot that i need to satisfy you, but i have seven figures in high yield bonds that are tax free. why are my bonds high yield? because i bought them when you and your other ham-and-egger friends were trying to figure out when GOOG would hit $1000...when instead you should have been cashing out. i'll definitely be ready for 20% t-notes with plenty of ammo, and you'll still be chump-change
- dmix 18y agoSo you can afford a book on grammar?
- david927 18y agoI'm with you, polter. Dow at 5 or even less, hyperinflation, etc. It's scary like a hurricane; seeing it coming doesn't help much. But I'm planting now. Partly because I have some 'peek-a-boo' technology and nothing could stop me at this point. But also because I think if I do it right, I can play the circumstance to my favor. I'm planning on keeping my job (as long as possible) and now that friends are getting laid off, I'm roping them into my plans. No offices, no logo t-shirts, and no fuzzy business plans. But I'm planting.
- p0ltergeist 18y agowell obviously there is no bad season for a true lead-to-gold scheme....but the market will be the judge of that. good luck
- nradov 18y agoThe DJIA at 5000 and hyperinflation are mutually exclusive. Currently we are in a deflationary period.
- johnyzee 18y agoIf hyper-inflation is coming, why would you hold on to cash? Sounds like a perfectly good reason to max out home equity loans at a fixed rate.
- prakash 18y agoCan you explain more about this? You have stated what you think will happen. What leads you to conclude that a "L-shaped recession"/ "secular bear market"? Thanks!
- p0ltergeist 18y agobecause this is not stocks leading the economy down (2000), this is the economy leading stocks down. this is a global debt crisis. simply restoring confidence will not change anything. those in debt will have to come out of debt. why aren't banks lending? would you lend to someone already technically insolvent? we've increased the national debt by 10% in just about a month. you tell me if you think that bodes well for the economy. indeed, debt will become more of a problem in coming years as people see their secured assets lose value (i.e., classic "underwater" loans). people will all seek to liquidate at once, but since they are underwater they will still be in debt even when they no longer have possessions. DEBT. that is all you need to know about this crisis. it will take years for our debt situation to be solved. until it does, we are in a secular bear.