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I probably have terminal "investor brain," but whenever this stuff happens my first thought is "my favorite store is having a sale." Then I think about everyon

by srvo 1y ago

I probably have terminal "investor brain," but whenever this stuff happens my first thought is "my favorite store is having a sale." Then I think about everyone that's getting hurt by this and kick myself for giving into my lizard brain.

deleted 1y ago
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tananaev 1y ago
I'm bouncing between this and thinking that "this time it's different". You can reverse tariffs policy, but a lost trust is very hard to repair.
- giantg2 1y ago
  If it's reversed faster than alternatives are in place, then it won't matter too much if the trust is there because what alternative is there? The logistics and stuff take time to change. If it persists long enough, then the trust piece will be more of a factor.
  - energy123 1y ago
    The alternative is to not spend and not invest and not hire because confidence is down and policy uncertainty is high, leading to a recession.
    - giantg2 1y ago
      Mone of that really has to do with the tariffs. Consumers will continue to buy what they can afford. This won't reduce that much, probably by about 5% is my guess based on multiple factors. Most healthy companies will continue to operate just fine. Market confidence is down, but it's been fragile due to it's overvalued state for a while. Aside from tariffs, policy outlook is very business friendly. This mostly a market overreaction or correction from being overvalued if we look at the past. This Chinese trade war has been going on since Trumps first term (at least). The rates on the top import/exports have been around or over 25% for a while. It's also interesting how much China is hurting itself with pork. The Chinese own Smithfield and are a huge importer of pork from the US, yet they slapped an 80% tarriff on it?
- readthenotes1 1y ago
  The lost trust won't affect the price of eggs or Honda Accord in Waukeekee
  - deleted 1y ago
    [deleted]
  - viraptor 1y ago
    It will affect if people buy a Honda they don't 100% need right now, or keep emergency money in case things go worse. Which on larger scale will still affect prices of everything.
- Animats 1y ago
  > You can reverse tariffs policy, but lost trust is very hard to repair. Indeed. That's especially true on the NATO side. This is a historical event on the scale of the breakup of the USSR.
  - timr 1y ago
    > Indeed. That's especially true on the NATO side. This is a historical event on the scale of the breakup of the USSR. Exaggeration isn't helpful. Whatever "this" is, you can't possibly make an assessment of that kind until years after the fact. In March 2020, people were convincing themselves that the global economy was flying straight into the ground, but people who didn't lose their minds made a lot of money, quickly. IMO, there was a better case for that panic, given the context (they were partly right! the lockdown stuff was incredibly costly!), than there is that this particular spasm is meaningful. Only time will tell.
    - ls612 1y ago
      In many ways the spasms we have seen globally the last few years are all downstream of the lockdowns and their damage.
    - motorest 1y ago
      > Exaggeration isn't helpful. Whatever "this" is, you can't possibly make an assessment of that kind until years after the fact. I don't think you fully grasp the gravity of Trump's actions. For the first time in its history, NATO is excluding the US from arms purchase programs. This takes place at a time where the EU is scrambling to prepare for a war with Russia, which is also caused by Trump's action of abandoning it's allies, The Trump administration is also heavily invested in annexation rhetoric targeting multiple NATO members. Then there's the whole tarrif absurdity. These sequence of moronic steps individually represent world-changing events. They all took place in a couple of months into the Trump administration's takeover. This goes well beyond the suspicion that Trump is a Russian stooge. This changes the way the world was structured after WW2. The fall of the soviet union might even have a smaller impact in world history.
- sentientslug 1y ago
  Every time this happens people say it’s different. See: COVID pandemic. And we know the V shaped recovery that came after that. Of course that shouldn’t be interpreted as a predictor of what’s to come next (because it’s not), my only point is to say that the same rhetoric pops up frequently during downtowns since forever.
  - chewbacha 1y ago
    At the time, there was trust that the government wanted to assist the recovery. They have lost the benefit of the doubt. This actually feels malicious. With Covid, recovery came as Covid was removed. With Trump, recovery can come with…
  - viraptor 1y ago
    After the initial COVID phases nothing major really changed long term as far as the world balance goes though. Everyone got affected, everyone started recovering. Things may have been uneven, but not like now, right?
    - pton_xd 1y ago
      That's his point. In the moment, everyone panics and thinks XYZ catastrophe is the end of the world as we know it. In hindsight, it never is. But who knows?! Maybe this is the time...
      - roenxi 1y ago
        > In hindsight, it never is. Up until WWII happened I doubt many people would have believed that sort of death and destruction was right around the corner. They'd just had WWI and weren't expecting that settling the unsettled business from that would be around 3x worse, break the European colonialists and ... I don't know how wiped out Jews in Europe were, but it was a painful experience although I assume some survived. The property damage was also extensive. High tariffs isn't going to be the end of the world & this particular stage of crisis doesn't look very important. But the overall geopolitical crisis we're in as everyone realigns certainly could end the world as we know it. Both in the literal and worst case senses. Few went in to WWII chuckling and saying that they were going to break their own power permanently, but that is what a lot of participants ended up doing.
- _bin_ 1y ago
  Did anybody actually “trust” other countries to start with? I’m reminded of the cynical yet accurate quote that nations don’t have friends, they have interests. I expect the American feds to pursue the best interests of Americans (though these policies aren’t in those best interests, it seems admin doesn’t know?) and foreign nations to do the same. This point is especially hollow because it is true that many countries have maintained asymmetric tariffs on us. Trade deficit aside, we shouldn’t let others collect a larger % of their imports from America than we collect of our imports from them. I’d take their cries of “lost trust” more seriously if they hadn’t shown with their actions they will pursue their own advantage too.
  - Aurornis 1y ago
    The “reciprocal” tariffs are nothing close to reciprocal. I hope you know by now that the numbers Trump presented were not actual tariff numbers that other countries put on us. The trust issue is domestic, too. Businesses just got slapped with the largest tax increase in history at home. Pointing fingers at other countries is a distraction. It’s ridiculous to think that this will encourage companies to start building factories here when even the raw materials are now heavily taxed on their way in to the country. Any sane company is going to pause US factory investment until there is some clarity and predictability.
    - _bin_ 1y ago
      I think I miscommunicated my support for some trade policy change as support for Trump’s “liberation day” tariffs. Here are things I think we should fix: - America and Hypotheticalstan each export $1T to each other with a bunch of tariffs on various things. America raises $50B in tariff revenue on Hypotheticalstan’s imports while Hypotheticalstan raises $100B on American imports. - America doesn’t make enough defense-critical stuff: steel, solar panels, chips, aluminum, rare earths, etc. - America has a ~$918B trade deficit. Things I do not care about: - Vietnam makes our Nikes. - We have a trade deficit with specifically Vietnam.
  - d1sxeyes 1y ago
    > Trade deficit aside, we shouldn’t let others collect a larger % of their imports from America than we collect of our imports from them. Why should you care how much another country charges its residents to import stuff from the US? Just sell at the price you want to sell at and who cares what goes on after your goods land.
- Aurornis 1y ago
  The closest modern analogy might be Liz Truss’ short tenure in the U.K. Her actions paled in comparison to this absurd tariff situation but the only way to resolve it and restore confidence was for her to resign. The problem in the US is that the tariff situations is bonkers insane, was clearly not thought out at all, and the person controlling the strings is talking about ways to run for a 3rd term instead of considering resignation. This is a political crisis. The best we can hope for is that the Senate pushes forward with attempts to reign in the president’s tariff powers and the House actually goes along, which is unlikely right now. I think we’re going to start seeing Republicans test the waters with breaking rank with Trump soon though.
  - deltaburnt 1y ago
    > I think we’re going to start seeing Republicans test the waters with breaking rank with Trump soon though. Been hearing that weekly for 8 years. If everything before this didn't trigger significant action, I doubt this will.
    - peteforde 1y ago
      This. When people this committed to crazy are shown [more] evidence, they just double down.
      - JohnnyMarcone 1y ago
        If people start turning against Trump, Congress will follow. Look what happened after the 2022 terms. Dems over performed and everyone immediately tried to make Ron Desantis a thing. Sharks will always be in the water around Trump waiting for him to slip. The question is, will Independents(maybe even some of the base) shift hard away when they start feeling the pain of the tariffs.
      - wellackshually 1y ago
        [flagged]
  - everybodyknows 1y ago
- j4coh 1y ago
  I really doubt they will reverse things. It will take impeachment or a new election before they admit they were wrong.
  - steve_adams_86 1y ago
    I strongly suspect they still wouldn’t admit they were wrong.
- autoexec 1y ago
  Loss of trust and finding other sources for the things they used to buy from the US, perhaps even producing those things themselves and becoming a new competitor the US didn't have before.
deleted 1y ago
[deleted]
animex 1y ago
For me, it's trying to gauge how deep the rabbit hole is.
- jayd16 1y ago
  Yes, I'm tempted to buy the dip but as a novice how do I know I'm not just hopping in the down elevator.
  - awfulneutral 1y ago
    Experts also do not know the answer to that.
  - weard_beard 1y ago
    One way to do it is pile into something with strong fundamentals you think will survive. Be the first into a rowboat that’s not leaking. Others will join you.
  - Cthulhu_ 1y ago
    Keep track of where it has been; you don't need to buy at the absolute lowest point, if it creeps back up you can slowly buy in again. Have a look at trackers like the S&P 500 after previous crashes, it takes 3-6 years for the market to return to its previous highest value. Or six months in the case of the panny-D crash.
- outer_web 1y ago
  Eh, just invest in the volatility.
loeg 1y ago
The market can keep falling until Trump pulls the lever back or enough of his pet legislators are willing to override him. As a long-term investor, I'm not selling. But we have no idea where the bottom is.
- energy123 1y ago
  The market is still pricing in the optimistic scenario of tariffs being repealed, either by supreme court (e.g. on the non-delegation doctrine), by congress veto (13 more Republican defectors), by impeachment, or by Trump changing his mind. If none of these four scenarios come to pass, the market will keep dropping as these possibilities get priced out and the remaining scenarios (escalation or maintenance of the tariffs) become more likely.
  - loeg 1y ago
    Right. > 13 more Republican defectors In the Senate, but we still need an even bigger chunk in the House.
  - timr 1y ago
    > The market is still pricing in the optimistic scenario of tariffs being repealed "The market" has no idea what the impact of the proposed changes are. Setting aside the obvious questions about whether or not this stuff will even happen, it's just not possible for something this complex to be evaluated so quickly. This is panic. People are wildly guessing about the "worst case scenario", without any detailed understanding (or even data) on what might happen [1,2]. It's all speculation, but lots and lots of people love to write horror stories for clicks and points. [1] Just for example: what does it even mean for an "X% tarrif on all products from country Y" to be imposed? The Harmonized Tariff Schedule is hundreds of thousands of line items, each with a different rate. Are they all being replaced with a single number? Is that line item number being multiplied by a factor? Something else? I guarantee that almost nobody knows the answer to that question right now. I'm not even sure an answer exists. [2] This is the only thing I've found that comes close to answering the question: https://hts.usitc.gov/reststop/file?release=currentRelease&filename=Change%20Record https://hts.usitc.gov/reststop/file?release=currentRelease&f... Starting just from the first line item leads to a branching set of changes, many of which have exceptions and dependencies on other changes: https://hts.usitc.gov/search?query=9903.01.25 https://hts.usitc.gov/search?query=9903.01.25 Working through that changeset is a non-trivial operation, and then, working through the impact on something as detailed as a supply chain for any non-trivial product is immensely complicated. Now do it for every product.
cperciva 1y ago
"Be greedy when everyone else is fearful" isn't just a recipe for profit; it also acts to reduce the size of market crashes and thereby make people get hurt less. Give in to your lizard brain!
- _bin_ 1y ago
  The caveat being if you have even a coarse-grained sense of market timing, this works strongly against your own pnl. The optimal strategy is to long the bubble, short the correction, then long the recovery. It’s not possible to do perfectly but you can often sell for part of the way down and skip some of your losses before buying back in. This generally would increase vol but is personally advantageous if you can do it. It is incredibly to “follow your lizard brain” and destroy your returns. Selloff? “Time to be greedy!” Whoops, caught that falling knife with your hand. Maybe it’s a V-shaped recovery a la corona. Maybe it’s a decade plus like the Nasdaq post-dot-com. Rally? “Time to be fearful!” Wait, it keeps going up? Do you get more fearful? Do you sit in cash for years amidst inflation and high returns?
- j4coh 1y ago
  Where does the cash come from if you’re invested? Are you just keeping huge piles of cash around in low interest accounts in the hopes that a black swan event comes along?
  - fmbb 1y ago
    You of course sold all your stocks beginning of November because you knew a deep crash was coming and wanted to be ready to buy into it. And now you have a lot of cash.
  - s1artibartfast 1y ago
    Yeah. I have 5 years salary in cash, and know many people who also pulled out of the market over the last 6 months. Hell, warren buffet is sitting on 350 billion in cash waiting for this exact scenario.
    - 1y ago
YZF 1y ago
I also try to think about things this way. Be careful though. When the stock market crashes everyone is negative and the pressure is on.
_bin_ 1y ago
I’ve had to shut my mouth hard the past week. I went heavily short right before the “liberation day” announcement and doubled my port. My buddies in finance, or my buddies who work elsewhere but whose accounts look rough, don’t want to here me enthuse about the nutty multiple expansion finally reversing so I can take my cash and buy at sale prices.
carabiner 1y ago
Cool, what are your trades going to be tomorrow?
Aurornis 1y ago
> my first thought is "my favorite store is having a sale." This gets repeated a lot, but unless you already had most of your portfolio in cash it’s not actually a net win to see a drawdown like this. The course of the global economy was just altered. The best case scenario would be if the proposed tariffs go away completely, but even then the markets will be cautious for the next 4 years at minimum. The market is down because the future prospects for those businesses just got much worse. Yeah you can buy them at a cheaper price, but their corresponding future output remains down as well. It’s like seeing a thing you wanted to buy go on sale, but upon closer inspection it’s on sale because it became damaged and you’re buying damaged goods. The best case scenario is that the administration pulls the “just kidding” card, reverses course, and claims some sort of victory while returning to the previous status quo. If that happens, stocks were briefly on sale even though they’re not rebounding back right away. However, if the administration digs their heels in and tries to push forward then the market is going to continue downward. This isn’t a normal drawdown. This is a crisis with the leadership of the United States.
- kortilla 1y ago
  >This isn’t a normal drawdown. This is a crisis with the leadership of the United States. The same thing happened just 4 short years ago when covid hit. Mass panic and then intervention kicked in. The intervention could have been taken away at any time but the market went extremely risk-on anyway and you would have gotten left behind if you sold out. >but even then the markets will be cautious for the next 4 years at minimum. You are overestimating the cautiousness of the market. Unless there are better returns offered in some other investment, the capital is going to pile back in if something like tariff deals start getting announced.
  - Aurornis 1y ago
    > The same thing happened just 4 short years ago when covid hit. COVID was a natural disaster. Leadership responded to it. This is the opposite. Markets were going well. Leadership intervened to crash them. Do you see the difference? It’s not the same. > You are overestimating the cautiousness of the market. You are underestimating the impacts of risk premia. This administration just showed that they don’t know what they’re doing, but they’re willing to go all-in on disastrous economic policy. They’ve already waffled on previous policy and then came back and doubled down. They’re still talking about more tariffs. This isn’t a little “oopsie” any more. It’s a pattern. It’s going to be a long 4 years until we can get back to stability. > Unless there are better returns offered in some other investment You are so close. It’s not just returns, it’s risk. Trump just made the market hyper risky.
mitthrowaway2 1y ago
If my favorite store went on sale, I'd be especially happy if the sale never ended and the prices never came back up. But it's hard to feel the same way about my investments.
- Ekaros 1y ago
  Makes me really think what is being sold. A significant discount in stock that continues paying dividends would be actually be reasonable. More return for same money. But many stocks are more so collectibles... Value going up for sake of it...
Kiro 1y ago
It being your favorite store implies you buy there a lot, which means you're already losing out so I don't get your reasoning.
moi2388 1y ago
Same. Sounds like the next four year will be nice to buy on a discount. I’m okay with that. As for people getting hurt, yeah, that sucks.. but you should never invest what you can’t miss..
- motorest 1y ago
  > As for people getting hurt, yeah, that sucks.. but you should never invest what you can’t miss.. You do understand that pension funds are financed through these investments, don't you? This means that the people who will be hurt the most are those who didn't invested. It's not the billions that Bezos and Musk lost that's painful. It's the old mom or pop who worked their whole life and now can't retire because their pension doesn't allow to survive.
  - moi2388 1y ago
    And you do realise these are long-term investments by pension funds and governments right? You aren’t actually getting paid with the actual money invested, they usually already calculate with 108-110% coverage, and already assume life-long coverage with an average far exceeded average lifespan, precisely to take this into account
- mailund 1y ago
  I mean, a lot of people who never invested in anything are going to get hurt by the incoming trade war as well tbh
JohnTHaller 1y ago
The phrase "don't catch a falling knife" has been uttered quite a lot the last few days
hippari2 1y ago
Well that includes you getting hurt too so don't feel too bad.
blitzar 1y ago
How many times have you "bought the dip" in the last 30%?

by srvo 1y ago

deleted 1y ago

[deleted]

tananaev 1y ago

I'm bouncing between this and thinking that "this time it's different". You can reverse tariffs policy, but a lost trust is very hard to repair.

giantg2 1y ago
If it's reversed faster than alternatives are in place, then it won't matter too much if the trust is there because what alternative is there? The logistics and stuff take time to change. If it persists long enough, then the trust piece will be more of a factor.
- energy123 1y ago
  The alternative is to not spend and not invest and not hire because confidence is down and policy uncertainty is high, leading to a recession.
  - giantg2 1y ago
    Mone of that really has to do with the tariffs. Consumers will continue to buy what they can afford. This won't reduce that much, probably by about 5% is my guess based on multiple factors. Most healthy companies will continue to operate just fine. Market confidence is down, but it's been fragile due to it's overvalued state for a while. Aside from tariffs, policy outlook is very business friendly. This mostly a market overreaction or correction from being overvalued if we look at the past. This Chinese trade war has been going on since Trumps first term (at least). The rates on the top import/exports have been around or over 25% for a while. It's also interesting how much China is hurting itself with pork. The Chinese own Smithfield and are a huge importer of pork from the US, yet they slapped an 80% tarriff on it?
readthenotes1 1y ago
The lost trust won't affect the price of eggs or Honda Accord in Waukeekee
- deleted 1y ago
  [deleted]
- viraptor 1y ago
  It will affect if people buy a Honda they don't 100% need right now, or keep emergency money in case things go worse. Which on larger scale will still affect prices of everything.
Animats 1y ago
> You can reverse tariffs policy, but lost trust is very hard to repair. Indeed. That's especially true on the NATO side. This is a historical event on the scale of the breakup of the USSR.
- timr 1y ago
  > Indeed. That's especially true on the NATO side. This is a historical event on the scale of the breakup of the USSR. Exaggeration isn't helpful. Whatever "this" is, you can't possibly make an assessment of that kind until years after the fact. In March 2020, people were convincing themselves that the global economy was flying straight into the ground, but people who didn't lose their minds made a lot of money, quickly. IMO, there was a better case for that panic, given the context (they were partly right! the lockdown stuff was incredibly costly!), than there is that this particular spasm is meaningful. Only time will tell.
  - ls612 1y ago
    In many ways the spasms we have seen globally the last few years are all downstream of the lockdowns and their damage.
  - motorest 1y ago
    > Exaggeration isn't helpful. Whatever "this" is, you can't possibly make an assessment of that kind until years after the fact. I don't think you fully grasp the gravity of Trump's actions. For the first time in its history, NATO is excluding the US from arms purchase programs. This takes place at a time where the EU is scrambling to prepare for a war with Russia, which is also caused by Trump's action of abandoning it's allies, The Trump administration is also heavily invested in annexation rhetoric targeting multiple NATO members. Then there's the whole tarrif absurdity. These sequence of moronic steps individually represent world-changing events. They all took place in a couple of months into the Trump administration's takeover. This goes well beyond the suspicion that Trump is a Russian stooge. This changes the way the world was structured after WW2. The fall of the soviet union might even have a smaller impact in world history.
sentientslug 1y ago
Every time this happens people say it’s different. See: COVID pandemic. And we know the V shaped recovery that came after that. Of course that shouldn’t be interpreted as a predictor of what’s to come next (because it’s not), my only point is to say that the same rhetoric pops up frequently during downtowns since forever.
- chewbacha 1y ago
  At the time, there was trust that the government wanted to assist the recovery. They have lost the benefit of the doubt. This actually feels malicious. With Covid, recovery came as Covid was removed. With Trump, recovery can come with…
- viraptor 1y ago
  After the initial COVID phases nothing major really changed long term as far as the world balance goes though. Everyone got affected, everyone started recovering. Things may have been uneven, but not like now, right?
  - pton_xd 1y ago
    That's his point. In the moment, everyone panics and thinks XYZ catastrophe is the end of the world as we know it. In hindsight, it never is. But who knows?! Maybe this is the time...
    - roenxi 1y ago
      > In hindsight, it never is. Up until WWII happened I doubt many people would have believed that sort of death and destruction was right around the corner. They'd just had WWI and weren't expecting that settling the unsettled business from that would be around 3x worse, break the European colonialists and ... I don't know how wiped out Jews in Europe were, but it was a painful experience although I assume some survived. The property damage was also extensive. High tariffs isn't going to be the end of the world & this particular stage of crisis doesn't look very important. But the overall geopolitical crisis we're in as everyone realigns certainly could end the world as we know it. Both in the literal and worst case senses. Few went in to WWII chuckling and saying that they were going to break their own power permanently, but that is what a lot of participants ended up doing.
_bin_ 1y ago
Did anybody actually “trust” other countries to start with? I’m reminded of the cynical yet accurate quote that nations don’t have friends, they have interests. I expect the American feds to pursue the best interests of Americans (though these policies aren’t in those best interests, it seems admin doesn’t know?) and foreign nations to do the same. This point is especially hollow because it is true that many countries have maintained asymmetric tariffs on us. Trade deficit aside, we shouldn’t let others collect a larger % of their imports from America than we collect of our imports from them. I’d take their cries of “lost trust” more seriously if they hadn’t shown with their actions they will pursue their own advantage too.
- Aurornis 1y ago
  The “reciprocal” tariffs are nothing close to reciprocal. I hope you know by now that the numbers Trump presented were not actual tariff numbers that other countries put on us. The trust issue is domestic, too. Businesses just got slapped with the largest tax increase in history at home. Pointing fingers at other countries is a distraction. It’s ridiculous to think that this will encourage companies to start building factories here when even the raw materials are now heavily taxed on their way in to the country. Any sane company is going to pause US factory investment until there is some clarity and predictability.
  - _bin_ 1y ago
    I think I miscommunicated my support for some trade policy change as support for Trump’s “liberation day” tariffs. Here are things I think we should fix: - America and Hypotheticalstan each export $1T to each other with a bunch of tariffs on various things. America raises $50B in tariff revenue on Hypotheticalstan’s imports while Hypotheticalstan raises $100B on American imports. - America doesn’t make enough defense-critical stuff: steel, solar panels, chips, aluminum, rare earths, etc. - America has a ~$918B trade deficit. Things I do not care about: - Vietnam makes our Nikes. - We have a trade deficit with specifically Vietnam.
- d1sxeyes 1y ago
  > Trade deficit aside, we shouldn’t let others collect a larger % of their imports from America than we collect of our imports from them. Why should you care how much another country charges its residents to import stuff from the US? Just sell at the price you want to sell at and who cares what goes on after your goods land.
Aurornis 1y ago
The closest modern analogy might be Liz Truss’ short tenure in the U.K. Her actions paled in comparison to this absurd tariff situation but the only way to resolve it and restore confidence was for her to resign. The problem in the US is that the tariff situations is bonkers insane, was clearly not thought out at all, and the person controlling the strings is talking about ways to run for a 3rd term instead of considering resignation. This is a political crisis. The best we can hope for is that the Senate pushes forward with attempts to reign in the president’s tariff powers and the House actually goes along, which is unlikely right now. I think we’re going to start seeing Republicans test the waters with breaking rank with Trump soon though.
- deltaburnt 1y ago
  > I think we’re going to start seeing Republicans test the waters with breaking rank with Trump soon though. Been hearing that weekly for 8 years. If everything before this didn't trigger significant action, I doubt this will.
  - peteforde 1y ago
    This. When people this committed to crazy are shown [more] evidence, they just double down.
    - JohnnyMarcone 1y ago
      If people start turning against Trump, Congress will follow. Look what happened after the 2022 terms. Dems over performed and everyone immediately tried to make Ron Desantis a thing. Sharks will always be in the water around Trump waiting for him to slip. The question is, will Independents(maybe even some of the base) shift hard away when they start feeling the pain of the tariffs.
    - wellackshually 1y ago
      [flagged]
- everybodyknows 1y ago
j4coh 1y ago
I really doubt they will reverse things. It will take impeachment or a new election before they admit they were wrong.
- steve_adams_86 1y ago
  I strongly suspect they still wouldn’t admit they were wrong.
autoexec 1y ago
Loss of trust and finding other sources for the things they used to buy from the US, perhaps even producing those things themselves and becoming a new competitor the US didn't have before.

deleted 1y ago

[deleted]

animex 1y ago

For me, it's trying to gauge how deep the rabbit hole is.

jayd16 1y ago
Yes, I'm tempted to buy the dip but as a novice how do I know I'm not just hopping in the down elevator.
- awfulneutral 1y ago
  Experts also do not know the answer to that.
- weard_beard 1y ago
  One way to do it is pile into something with strong fundamentals you think will survive. Be the first into a rowboat that’s not leaking. Others will join you.
- Cthulhu_ 1y ago
  Keep track of where it has been; you don't need to buy at the absolute lowest point, if it creeps back up you can slowly buy in again. Have a look at trackers like the S&P 500 after previous crashes, it takes 3-6 years for the market to return to its previous highest value. Or six months in the case of the panny-D crash.
outer_web 1y ago
Eh, just invest in the volatility.

loeg 1y ago

The market can keep falling until Trump pulls the lever back or enough of his pet legislators are willing to override him. As a long-term investor, I'm not selling. But we have no idea where the bottom is.

energy123 1y ago
The market is still pricing in the optimistic scenario of tariffs being repealed, either by supreme court (e.g. on the non-delegation doctrine), by congress veto (13 more Republican defectors), by impeachment, or by Trump changing his mind. If none of these four scenarios come to pass, the market will keep dropping as these possibilities get priced out and the remaining scenarios (escalation or maintenance of the tariffs) become more likely.
- loeg 1y ago
  Right. > 13 more Republican defectors In the Senate, but we still need an even bigger chunk in the House.
- timr 1y ago
  > The market is still pricing in the optimistic scenario of tariffs being repealed "The market" has no idea what the impact of the proposed changes are. Setting aside the obvious questions about whether or not this stuff will even happen, it's just not possible for something this complex to be evaluated so quickly. This is panic. People are wildly guessing about the "worst case scenario", without any detailed understanding (or even data) on what might happen [1,2]. It's all speculation, but lots and lots of people love to write horror stories for clicks and points. [1] Just for example: what does it even mean for an "X% tarrif on all products from country Y" to be imposed? The Harmonized Tariff Schedule is hundreds of thousands of line items, each with a different rate. Are they all being replaced with a single number? Is that line item number being multiplied by a factor? Something else? I guarantee that almost nobody knows the answer to that question right now. I'm not even sure an answer exists. [2] This is the only thing I've found that comes close to answering the question: https://hts.usitc.gov/reststop/file?release=currentRelease&filename=Change%20Record https://hts.usitc.gov/reststop/file?release=currentRelease&f... Starting just from the first line item leads to a branching set of changes, many of which have exceptions and dependencies on other changes: https://hts.usitc.gov/search?query=9903.01.25 https://hts.usitc.gov/search?query=9903.01.25 Working through that changeset is a non-trivial operation, and then, working through the impact on something as detailed as a supply chain for any non-trivial product is immensely complicated. Now do it for every product.

cperciva 1y ago

"Be greedy when everyone else is fearful" isn't just a recipe for profit; it also acts to reduce the size of market crashes and thereby make people get hurt less. Give in to your lizard brain!

_bin_ 1y ago
The caveat being if you have even a coarse-grained sense of market timing, this works strongly against your own pnl. The optimal strategy is to long the bubble, short the correction, then long the recovery. It’s not possible to do perfectly but you can often sell for part of the way down and skip some of your losses before buying back in. This generally would increase vol but is personally advantageous if you can do it. It is incredibly to “follow your lizard brain” and destroy your returns. Selloff? “Time to be greedy!” Whoops, caught that falling knife with your hand. Maybe it’s a V-shaped recovery a la corona. Maybe it’s a decade plus like the Nasdaq post-dot-com. Rally? “Time to be fearful!” Wait, it keeps going up? Do you get more fearful? Do you sit in cash for years amidst inflation and high returns?
j4coh 1y ago
Where does the cash come from if you’re invested? Are you just keeping huge piles of cash around in low interest accounts in the hopes that a black swan event comes along?
- fmbb 1y ago
  You of course sold all your stocks beginning of November because you knew a deep crash was coming and wanted to be ready to buy into it. And now you have a lot of cash.
- s1artibartfast 1y ago
  Yeah. I have 5 years salary in cash, and know many people who also pulled out of the market over the last 6 months. Hell, warren buffet is sitting on 350 billion in cash waiting for this exact scenario.
  - 1y ago

YZF 1y ago

I also try to think about things this way. Be careful though. When the stock market crashes everyone is negative and the pressure is on.

_bin_ 1y ago

I’ve had to shut my mouth hard the past week. I went heavily short right before the “liberation day” announcement and doubled my port. My buddies in finance, or my buddies who work elsewhere but whose accounts look rough, don’t want to here me enthuse about the nutty multiple expansion finally reversing so I can take my cash and buy at sale prices.

carabiner 1y ago

Cool, what are your trades going to be tomorrow?

Aurornis 1y ago

> my first thought is "my favorite store is having a sale." This gets repeated a lot, but unless you already had most of your portfolio in cash it’s not actually a net win to see a drawdown like this. The course of the global economy was just altered. The best case scenario would be if the proposed tariffs go away completely, but even then the markets will be cautious for the next 4 years at minimum. The market is down because the future prospects for those businesses just got much worse. Yeah you can buy them at a cheaper price, but their corresponding future output remains down as well. It’s like seeing a thing you wanted to buy go on sale, but upon closer inspection it’s on sale because it became damaged and you’re buying damaged goods. The best case scenario is that the administration pulls the “just kidding” card, reverses course, and claims some sort of victory while returning to the previous status quo. If that happens, stocks were briefly on sale even though they’re not rebounding back right away. However, if the administration digs their heels in and tries to push forward then the market is going to continue downward. This isn’t a normal drawdown. This is a crisis with the leadership of the United States.

kortilla 1y ago
>This isn’t a normal drawdown. This is a crisis with the leadership of the United States. The same thing happened just 4 short years ago when covid hit. Mass panic and then intervention kicked in. The intervention could have been taken away at any time but the market went extremely risk-on anyway and you would have gotten left behind if you sold out. >but even then the markets will be cautious for the next 4 years at minimum. You are overestimating the cautiousness of the market. Unless there are better returns offered in some other investment, the capital is going to pile back in if something like tariff deals start getting announced.
- Aurornis 1y ago
  > The same thing happened just 4 short years ago when covid hit. COVID was a natural disaster. Leadership responded to it. This is the opposite. Markets were going well. Leadership intervened to crash them. Do you see the difference? It’s not the same. > You are overestimating the cautiousness of the market. You are underestimating the impacts of risk premia. This administration just showed that they don’t know what they’re doing, but they’re willing to go all-in on disastrous economic policy. They’ve already waffled on previous policy and then came back and doubled down. They’re still talking about more tariffs. This isn’t a little “oopsie” any more. It’s a pattern. It’s going to be a long 4 years until we can get back to stability. > Unless there are better returns offered in some other investment You are so close. It’s not just returns, it’s risk. Trump just made the market hyper risky.

mitthrowaway2 1y ago

If my favorite store went on sale, I'd be especially happy if the sale never ended and the prices never came back up. But it's hard to feel the same way about my investments.

Ekaros 1y ago
Makes me really think what is being sold. A significant discount in stock that continues paying dividends would be actually be reasonable. More return for same money. But many stocks are more so collectibles... Value going up for sake of it...

Kiro 1y ago

It being your favorite store implies you buy there a lot, which means you're already losing out so I don't get your reasoning.

moi2388 1y ago

Same. Sounds like the next four year will be nice to buy on a discount. I’m okay with that. As for people getting hurt, yeah, that sucks.. but you should never invest what you can’t miss..

motorest 1y ago
> As for people getting hurt, yeah, that sucks.. but you should never invest what you can’t miss.. You do understand that pension funds are financed through these investments, don't you? This means that the people who will be hurt the most are those who didn't invested. It's not the billions that Bezos and Musk lost that's painful. It's the old mom or pop who worked their whole life and now can't retire because their pension doesn't allow to survive.
- moi2388 1y ago
  And you do realise these are long-term investments by pension funds and governments right? You aren’t actually getting paid with the actual money invested, they usually already calculate with 108-110% coverage, and already assume life-long coverage with an average far exceeded average lifespan, precisely to take this into account
mailund 1y ago
I mean, a lot of people who never invested in anything are going to get hurt by the incoming trade war as well tbh

JohnTHaller 1y ago

The phrase "don't catch a falling knife" has been uttered quite a lot the last few days

hippari2 1y ago

Well that includes you getting hurt too so don't feel too bad.

blitzar 1y ago

How many times have you "bought the dip" in the last 30%?