World markets are tanking

[AU64 10,122]

6 minutes ago, Brad_ATX said:

Well no, it won't be the last time we see 26,000.  The market has always gone up over the long term, but today was the single worst day in market history with regards to raw points lost on the Dow.  Certainly concerning when we've lost about 2,200 points in the last three trading days.

True...would have preferred to see it going up....but it goes up and down of course and convenient to be able to buy with some growth potential....mostly been selling the past month or so......looked a little too "good" when it got over 24,000 or so.     As I noted earlier.....the market is not the economy and even looking at corporate earnings, the economy looks pretty good.     

And you have to watch out about raw points....it's percentage that matters.... 

[TexasTiger 12,900]

I’m not sure what this fact means, I just know what Trump claims the Stock Market has meant lately:

 

 

John Harwood

 

@JohnJHarwood

 

 

increase in Dow Jones Industrial Average from president's Inauguration Day to Feb 5 of following year: --Trump 22.7% --Obama 38.5%

3:12 PM · Feb 5, 2018

[Brad_ATX 13,654]

9 minutes ago, AU64 said:

True...would have preferred to see it going up....but it goes up and down of course and convenient to be able to buy with some growth potential....mostly been selling the past month or so......looked a little too "good" when it got over 24,000 or so.     As I noted earlier.....the market is not the economy and even looking at corporate earnings, the economy looks pretty good.     

And you have to watch out about raw points....it's percentage that matters.... 

Which is exactly why I made sure to point out it was on raw points only

[AU64 10,122]

32 minutes ago, Brad_ATX said:

Which is exactly why I made sure to point out it was on raw points only

I appreciate that.....and funny thing is that last Thursday people were activing buying stocks when the market was 26,000 and today they are selling when it is 24,000.....so wondering if the same people who were buying are now selling?    Sounds like some people might have been caught short. 

And what happened over the weekend that made such a difference in their view of the future?    :I'm guessing it was the Eagles winning the Super Bowl?  Probably as good an explanation as we will get on CNBC or Fox. 

Funny thing also is that I did a quick search on "why the selloff" a few minutes ago and first thing up was an article from 2014 attempting to explain the dip in July.....when the market was about 17,600 and had dropped about 2-3%.  

Just have to keep the faith...

[Brad_ATX 13,654]

36 minutes ago, AU64 said:

I appreciate that.....and funny thing is that last Thursday people were activing buying stocks when the market was 26,000 and today they are selling when it is 24,000.....so wondering if the same people who were buying are now selling?    Sounds like some people might have been caught short. 

And what happened over the weekend that made such a difference in their view of the future?    :I'm guessing it was the Eagles winning the Super Bowl?  Probably as good an explanation as we will get on CNBC or Fox. 

Funny thing also is that I did a quick search on "why the selloff" a few minutes ago and first thing up was an article from 2014 attempting to explain the dip in July.....when the market was about 17,600 and had dropped about 2-3%.  

Just have to keep the faith...

From what I'm reading, the sell-off is happening for multiple reasons.  Higher bond yields are making those more attractive investments than they have been for quite some time.  When you combine this with the likelihood that interest rates are going to rise soon and the fear of inflation finally hitting after 8+ years of growth without inflation, you end up with a combustible situation.  Pretty decent analysis of it here:

http://money.cnn.com/2018/02/05/investing/stock-market-today-dow-jones/index.html

It still doesn't mean that the sell-off is a long-term thing though.  Could be just a brief cooling down period (like a team winning 10 straight, losing 2-3, then ripping off 7 more).

[RunInRed 16,413]

@Auburn85 chasing asse 5% yields in a rising rate environment? ?‍♂️

[AU64 10,122]

2 hours ago, Brad_ATX said:

From what I'm reading, the sell-off is happening for multiple reasons.  Higher bond yields are making those more attractive investments than they have been for quite some time.  When you combine this with the likelihood that interest rates are going to rise soon and the fear of inflation finally hitting after 8+ years of growth without inflation, you end up with a combustible situation.  Pretty decent analysis of it here:

http://money.cnn.com/2018/02/05/investing/stock-market-today-dow-jones/index.html

It still doesn't mean that the sell-off is a long-term thing though.  Could be just a brief cooling down period (like a team winning 10 straight, losing 2-3, then ripping off 7 more).

Thanks for the link....and that makes some sense except that four or five days ago people were buying stocks at around 26,000 and all of a sudden someone woke up this morning and decided that inflation was in our future? ..so they decide to panic and sell out?   That is what does  not make sense unless a number of people had to sell....maybe profit taking or for other reasons that caused then to take a loss on their investments.   

There is usually more to these panic reactions than just an epiphany about possible future events ...like maybe inflation in the future?.....although a few influential people may be able to get the ball rolling with comments over the weekend or on the early morning business shows. 

Just suggesting that anyone who sold stocks after 10AM today did not do it because they all of a sudden were worried about inflation or that the fed might raise rates.  For example, understand some ETF funds had to bail at whatever the could get for some of their stocks in order to meet demands of their customers who might have wanted to do some profit taking... Mostly I am in ETFs but they have the potential for a volatile affect on the market. . 

 

    

[Elephant Tipper 430]

3 hours ago, TexasTiger said:

increase in Dow Jones Industrial Average from president's Inauguration Day to Feb 5 of following year: --Trump 22.7% --Obama 38.5%

3:12 PM · Feb 5, 2018

GARBAGE !

Either you didn't do your homework or _________ ?  The information you quoted is FALSE.  Here are the FACTS and REAL numbers:

First, the market doesn't care about inauguration day.  Election day is the determinant.  The market reacts to the incoming
administration's policies when determined whose policies will be implemented.  Harwood is quoting someone who wants to mislead and you
apparently don't mind helping him.

Second, for funsies, let's take those two immaterial dates Harman quotes and then use the REAL numbers to show you what
actually happened during the Obama timeframe.
a) On 01/20/09 the market closed at 7,949.  Btw, the market lost 4% (332 points) on the day of Obama's inauguration.  
b)) On 02/05/10 the market closed at 10,012.  That was a 2,063 point gain which was 26%, NOT the 38.5% which Harman purports.

Third, for funsies, let's take the DJIA numbers on the day of DJT's inauguration:
a) 01/20/17 the market closed at 19,827.  For what it's worth, the market closed 95 points higher the day of DJT's inauguration.
b)) 02/05/18 the market closed at 24,345.  That's a 23% gain in overall market value, but again, those two dates are immaterial to
how the markets trade and there is little difference between 23% and 26%.
c) What you should also understand is that this was a 4,500 point gain under the DJT administration's first year.

Fourth, the market reacts to election results, NOT inaugurations.
a) 11/04/08 the market closed at 9,625.  The very next day after Obama's election the market lost 486 points to close at 9,139.  That
was a 4% loss in market value based upon Obama's election.  Imagine that, the market tanked twice when it knew for sure that Obama
would become president.
b)) For the next 5 months the market continued to drop, falling below 6,700 in March, 2009.  The market LOST 30% upon Obama's election
before it began to turn.
c) In the weeks prior to the 11/08/16 election date, the DJIA market traded in the high range of 18,500-18,600.  On election day,
with HRC a 95% favorite to win the election, the market tanked 900 points, about 5%.
d) In overnight trading on 11/08/16, the market continued to drop until the news came out that DJT won Pennsylvania.  The drop stopped.  
Over the next few hours the market traded sideways in the 17,425-17,500 range.  
e) Once DJT was projected the winner of the election the market soared from around 17,500 in overnight trading.  The day after the
election, the DJIA closed at 18,332.  The DJIA gained 800 points by the close of the day after the election.  UNPRECEDENTED !
f) IF you had entered the market the morning after DJT's election you would have gained from 17,500-24,345 (today's close) which is a
39% gain as of today, 02/05/18.
g) The market after Obama's election opened at 9,616 and by 02/05/10 closed at 10,012, which was only a 4% gain.  VAST difference
between the numbers Harman quotes, and more accurate.

Fifth, even with an 11% correction today, the market is still far ahead of the Obama, Bush, Clinton, Bush and even Reagan legacies.  
Once the DJT policies are in full force this market will rocket.  A new bright future for America has only begun under DJT.

I didn't vote for DJT but I wish I had.  Next time.

[AUDub 11,150]

Nikkei is in free fall right now. We’re probably not done. 

[homersapien 11,379]

1 hour ago, AU64 said:

Thanks for the link....and that makes some sense except that four or five days ago people were buying stocks at around 26,000 and all of a sudden someone woke up this morning and decided that inflation was in our future? ..so they decide to panic and sell out?   That is what does  not make sense unless a number of people had to sell....maybe profit taking or for other reasons that caused then to take a loss on their investments.   

There is usually more to these panic reactions than just an epiphany about possible future events ...like maybe inflation in the future?.....although a few influential people may be able to get the ball rolling with comments over the weekend or on the early morning business shows. 

Just suggesting that anyone who sold stocks after 10AM today did not do it because they all of a sudden were worried about inflation or that the fed might raise rates.  For example, understand some ETF funds had to bail at whatever the could get for some of their stocks in order to meet demands of their customers who might have wanted to do some profit taking... Mostly I am in ETFs but they have the potential for a volatile affect on the market. . 

 

    

The current theory (I like), is programmed trading - similar algorithms.

[RunInRed 16,413]

1 hour ago, Elephant Tipper said:

GARBAGE !

Either you didn't do your homework or _________ ?  The information you quoted is FALSE.  Here are the FACTS and REAL numbers:

First, the market doesn't care about inauguration day.  Election day is the determinant.  The market reacts to the incoming
administration's policies when determined whose policies will be implemented.  Harwood is quoting someone who wants to mislead and you
apparently don't mind helping him.

Second, for funsies, let's take those two immaterial dates Harman quotes and then use the REAL numbers to show you what
actually happened during the Obama timeframe.
a) On 01/20/09 the market closed at 7,949.  Btw, the market lost 4% (332 points) on the day of Obama's inauguration.  
b)) On 02/05/10 the market closed at 10,012.  That was a 2,063 point gain which was 26%, NOT the 38.5% which Harman purports.

Third, for funsies, let's take the DJIA numbers on the day of DJT's inauguration:
a) 01/20/17 the market closed at 19,827.  For what it's worth, the market closed 95 points higher the day of DJT's inauguration.
b)) 02/05/18 the market closed at 24,345.  That's a 23% gain in overall market value, but again, those two dates are immaterial to
how the markets trade and there is little difference between 23% and 26%.
c) What you should also understand is that this was a 4,500 point gain under the DJT administration's first year.

Fourth, the market reacts to election results, NOT inaugurations.
a) 11/04/08 the market closed at 9,625.  The very next day after Obama's election the market lost 486 points to close at 9,139.  That
was a 4% loss in market value based upon Obama's election.  Imagine that, the market tanked twice when it knew for sure that Obama
would become president.
b)) For the next 5 months the market continued to drop, falling below 6,700 in March, 2009.  The market LOST 30% upon Obama's election
before it began to turn.
c) In the weeks prior to the 11/08/16 election date, the DJIA market traded in the high range of 18,500-18,600.  On election day,
with HRC a 95% favorite to win the election, the market tanked 900 points, about 5%.
d) In overnight trading on 11/08/16, the market continued to drop until the news came out that DJT won Pennsylvania.  The drop stopped.  
Over the next few hours the market traded sideways in the 17,425-17,500 range.  
e) Once DJT was projected the winner of the election the market soared from around 17,500 in overnight trading.  The day after the
election, the DJIA closed at 18,332.  The DJIA gained 800 points by the close of the day after the election.  UNPRECEDENTED !
f) IF you had entered the market the morning after DJT's election you would have gained from 17,500-24,345 (today's close) which is a
39% gain as of today, 02/05/18.
g) The market after Obama's election opened at 9,616 and by 02/05/10 closed at 10,012, which was only a 4% gain.  VAST difference
between the numbers Harman quotes, and more accurate.

Fifth, even with an 11% correction today, the market is still far ahead of the Obama, Bush, Clinton, Bush and even Reagan legacies.  
Once the DJT policies are in full force this market will rocket.  A new bright future for America has only begun under DJT.

I didn't vote for DJT but I wish I had.  Next time.

The Dow has lost 27% of its gains since Election Day 2016.

[AU64 10,122]

And yet it's still up about 25%  ....hope you were able to take advantage of it...

[Elephant Tipper 430]

17 hours ago, RunInRed said:

The Dow has lost 27% of its gains since Election Day 2016.

RIR, two things.  First, you're trying to use the same asinine logic as TT using some catchy headline that's short and sweet but not factual.
You're just quoting some talking head who wants this dramatic decline to mean it's a bad reflection on DJT's policies.  It isn't.  
DON'T DO IT.

Second, your statement tells me that you didn't bother to read what I wrote or you don't understand it.

So let's take your statement, "The Dow has lost 27% of its gains since Election Day 2016".  (The "loss" was worse than that, but I wonder if
you've read this far).  My question to you is, Do you even know what those numbers were to create that fiction you posted ?  Probably not.  
You should want to be honest with yourself so I'm going to try and help you with that so you don't latch onto whatever false diatribe that's
put out in the "news".

Before I start, you need to also understand that these numbers which people quote are ephemeral.  They are of no consequence.  For
example, during the Obama administration the DJIA dropped about 1,200 points in just a few minutes, not like the decline that took all
day we witnessed on 02/05/18.  That fall was due to programmed trading with stops kicking in PLUS some trader had used a novel strategy to
take advantage of such which further accelerated the drop.  Was that a reflection of Obama's policies ?  No.  02/05/18 was most likely
the same or similar.  The fundamentals of this economy are excellent and will only improve with the current administration's policies.

So let's take your statement and work with it.  The market on election day (overnight trading) had bottomed at around 17,450-17,500.  This price range was
"ephemeral".  It lasted just a few hours, but it was the market's rallying point so we'll use it.  When the news was  announced that
DJT won PA, then MI, then WI, the market began to take off.  The market topped at 26,616 in 01/26/18, which also was ephemeral.  It too lasted
only a few hours. Using those two extreme price points, in 14 months the market grew about 9,166 points.  From that high of 26,616 the market
dropped to 23,781 the morning of 02/06/18.  That's a loss of 2,800 points which is a 31% loss.  But this is not how one figures these market
moves but I keep seeing them quoted on here as being truth.  smh  You said that the market lost 27%, but I say it was worse.  It was 31%.

To finish, let's use the closing price for 02/06/18 which is 24,912.  Subtract the 17,500 from election night and you have an increase
of 7,400 points which is a total increase of 42% in market since election night, 2016.  But I'm telling you that these numbers are temporary.
They don't mean that much in the grand scheme of the market but they're used to try and demonstrate a foolish point.  

Last of all, the market does not necessarily reflect economics, in fact, it does so less and less.

Did you read this far ?  If you did, then I'll state it once more, the market is up 42% since election day, 2016 as of today's close.

 

[Elephant Tipper 430]

18 hours ago, homersapien said:

The current theory (I like), is programmed trading - similar algorithms.

Yes, most likely.   No fundamentals have changed, no political change has occurred, no announcement of war and no announcement that Nick Saban has been sainted.

EDIT: Possible interest hike could have precipitated a drop, but then a hike in interest rates indicates a healthy economy, one that is growing and there is competition for $$$$.

[Elephant Tipper 430]

17 hours ago, AU64 said:

And yet it's still up about 25%  ....hope you were able to take advantage of it...

Since election day, 40% + as of today's close.

[NolaAuTiger 3,295]

18 hours ago, RunInRed said:

The Dow has lost 27% of its gains since Election Day 2016.

 

12 minutes ago, Elephant Tipper said:

Since election day, 40% + as of today's close.

*Grabs popcorn, cracks open a beer.... waits for @RunInRed to respond

[AU64 10,122]

10 minutes ago, Elephant Tipper said:

Since election day, 40% + as of today's close.

One thing I know is that when the programmed trading kicks in, private investors/traders like me better get out of the way or you will get run over.  And you don't take a loss unless you sell during the panic or programming frenzy.   Paper losses are not real losses unless you make them so....at least that is usually the case for individual investors. 

[augolf1716 21,170]

I have been with the same small financial firm in Orlando for over 20 years. She has been on CNN multiple times and obviously I trust her. She sent this e mail out yesterday. 

 

Dear Clients,

 

The current stock market selloff is long overdue and perfectly normal during regular market cycles. The catalyst is fears of a recession due to rising interest rates. There is no sign of a recession now but there will be another recession, eventually.

 

The economy is finally strong enough that the Federal Reserve no longer needs to keep rates artificially low as it did during and after the Great Recession of 2007-2009. The unemployment rate is 4.1%; 81% of 4th quarter 2017 corporate earnings that have reported have exceeded estimates; and 75% of those companies have increased their fiscal year 2018 earnings-per-share projections.

 

Even though the recent market movement has been quick and drastic, selloffs are ordinary, typical, and healthy over the long run. The market will find its footing again and it is important to remember that the macroeconomic fundamentals drive markets over the long run.

 

Below are a few excerpts from Susan’s January Commentary column,  Macroeconomic View and Outlook:

 

“The macro picture remains positive. Corporate earnings and revenues grew at a fast pace during the year. The economies of all 45 countries tracked by the Organization for Economic Cooperation and Development were on pace to expand, an unusual status. This occurred despite the continuing global geopolitical turmoil and deep global angst and uncertainty created by both Brexit and by “first-year” White House drama. In other words, all the “headline risk” we have discussed this year in prior Commentaries continued…but still could not trump the good news of corporate earnings and revenues. Indeed, most dips were marked by big buying.”

               

“Unfortunately, many post-election stock unbelievers began jumping on the bandwagon late in the cycle. TD Ameritrade reported that in November, its index measuring investors’ stock exposure had it largest move up EVER. Think about it. November 2017, after the stock market had been on a virtual tear for 10 months, investors poured in to stocks. It’s usually a sign of an upcoming market top. Of course, U.S. stocks are long overdue for a correction to wring out inevitable market excesses.”

 

“We are optimistic that the stock market will end higher in 2018 than in 2017, however, we do believe that returns will be much smaller and volatility will be much higher. Headwinds will include higher short-term interest rates making new home mortgages more unaffordable, higher inflation both in energy, wages and goods affected by higher production costs, more global political turmoil including and especially in Washington, D.C. as midterm elections come center stage with Russia intrigue as a backdrop.”

We encourage you to reread the entire column in the attached Commentary.

[Auburn85 432]

21 hours ago, RunInRed said:

@Auburn85 chasing asse 5% yields in a rising rate environment? ?‍♂️

Hey RIR, sorry it took so long to get back to you. Eh, not necessarily chasing, but  I do look for stocks where the dividend is safe from a cut and the stock price has potential to grow.

Centurylink is stock I've watched for a while, but always shy away. Huge yield. However, in the past, they've cut the dividend. Also, the stock has projected down over the last few years. Despite the downward track, the company is still maintaining the current dividend.

[AU64 10,122]

3 hours ago, Auburn85 said:

Hey RIR, sorry it took so long to get back to you. Eh, not necessarily chasing, but  I do look for stocks where the dividend is safe from a cut and the stock price has potential to grow.

Centurylink is stock I've watched for a while, but always shy away. Huge yield. However, in the past, they've cut the dividend. Also, the stock has projected down over the last few years. Despite the downward track, the company is still maintaining the current dividend.

Thanks....and for anyone hoping to build a reasonable retirement base, 5% is a very modest investment goal.   For many seniors who have been retired for a while, we saw CD rates at barely 1% and bonds just a bit higher.  There was no way to protect the future with interests rates that barely kept up with the rate of inflation, especially for seniors faced with medical costs that far outstripped COLA adjustments...which depleted retirement funds at a rapid rate.. 

Always nice to have a safe investment with returns in the 5-7% range...and they were not that easy to find for quite a while. . 

[Brad_ATX 13,654]

4 minutes ago, AU64 said:

Thanks....and for anyone hoping to build a reasonable retirement base, 5% is a very modest investment goal.   For many seniors who have been retired for a while, we saw CD rates at barely 1% and bonds just a bit higher.  There was no way to protect the future with interests rates that barely kept up with the rate of inflation, especially for seniors faced with medical costs that far outstripped COLA adjustments...which depleted retirement funds at a rapid rate.. 

Always nice to have a safe investment with returns in the 5-7% range...and they were not that easy to find for quite a while. . 

I'm not sure what the exact funds are, but I know my retired parents use an annuity.  Gives them something like a 3% guaranteed return each year, but if the market outperforms, they get more.  It's about as safe as you can get.

[AU64 10,122]

15 minutes ago, Brad_ATX said:

I'm not sure what the exact funds are, but I know my retired parents use an annuity.  Gives them something like a 3% guaranteed return each year, but if the market outperforms, they get more.  It's about as safe as you can get.

Thanks....lots of retirees do.....they provide maximum safety but returns are often not that good.   That is one of the balancing acts that we have to make.   If you have a lot of money, a  3% return might be enough but there are formulas about how much you can withdraw and not run out.   Sometimes those annuities are spin offs from company retirement plans and have options for the lifetime of both spouses but with lower monthly benefits. 

Lots of good articles out there on the pros and cons of annuities but I'm a big fan of Roth IRAs or 401ks which you (or a professional) can manage during your 30s through your 50s to build up the fund before going more conservative.   Anyone who does not maximize their 401k opportunities is just short-sighted.   All the years I worked, I only had a true company retirement plan for about 15 years (two companies) and both companies abandoned their plans and went to defined contribution plans (401k) ..cashed me out.....so I ended up in charge of my retirement plan for most of my working life.  

[Brad_ATX 13,654]

3 hours ago, AU64 said:

Thanks....lots of retirees do.....they provide maximum safety but returns are often not that good.   That is one of the balancing acts that we have to make.   If you have a lot of money, a  3% return might be enough but there are formulas about how much you can withdraw and not run out.   Sometimes those annuities are spin offs from company retirement plans and have options for the lifetime of both spouses but with lower monthly benefits. 

Lots of good articles out there on the pros and cons of annuities but I'm a big fan of Roth IRAs or 401ks which you (or a professional) can manage during your 30s through your 50s to build up the fund before going more conservative.   Anyone who does not maximize their 401k opportunities is just short-sighted.   All the years I worked, I only had a true company retirement plan for about 15 years (two companies) and both companies abandoned their plans and went to defined contribution plans (401k) ..cashed me out.....so I ended up in charge of my retirement plan for most of my working life.  

They have active 401ks (as do I).  They've just moved a decent amount to annuities as they've hit retirement.

[AU64 10,122]

7 hours ago, Brad_ATX said:

They have active 401ks (as do I).  They've just moved a decent amount to annuities as they've hit retirement.

That takes the worry and uncertainty out of it.  As for me, I would miss the excitement of watching my retirement pool lose 5% overnight.. or grow by 30% ☺..keeps me active.. but sometimes nervous.

[RunInRed 16,413]

@Elephant Tipper ... I'm a simple guy, I'm not sure what any of your nonsense is ... but my Auburn education tells me:

• The DOW ended at 18,332 on Election Day. 
• On Jan 26, the DOW peaked at 26,616 (26,616-18,332 = 8,284; 8,284 / 18,332 ... up about ~45% from Election Day).
• Monday this current 'correction' bottomed at  at 24,345 ( 24,345-18,332=6,561; 6,013/18,332 = ~+33%). 
  • After this correction, the DOW had given up 27% of gains since election (45%-33%=12%; 12%/45% = 27%).
  • It has since recovered some.

You are entitled to your own "ephermal" opinions but not your own facts.  Based on today's (2/07/18) closing price of 24, 893, the DOW is up ~35% since Election Day.  Carry on.