OT: Recovery Poll
- Thread starter leeinator
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The DOW and NASDAQ were both lower than this last April. We are going to be ok.
Agree....it will be ok, but how long till it's ok? I have 2 close friends who were to retire within days and now have told their employer they have rescinded their retirement temporarily until the market recovers. One works for Procter & Gamble. Also.....I can't remember, but how long did the 2008 cliff take to get back to where it was? I think a few years, but not sure. I have already retired so this recent dive doesn't really effect me cause I have plenty of time.
The stock market is the least of our worries.
Our national leadership has to start leading and stop the policy whiplash before the idea of stability can be considered. Practically fabricating a recession out of thin air. As Ferris Bueler’s teacher put it in that now viral scene:
"In 1930, the Republican-controlled House of Representatives, in an effort to alleviate the effects of the… Anyone? Anyone?" When he gets no reply, he answers his question himself: “Great Depression."
"Passed the... Anyone? Anyone? The tariff bill. The Hawley-Smoot Tariff Act. Which... Anyone? Raised or lower? Raised tariffs in an effort to collect more revenue for the federal government. Did it work? Anyone? Anyone know the effects? It did not work, and the United States sank deeper into the Great Depression."
If they're that close to retirement and hadn't moved most of it to low risk investments like bonds and low risk stocks, that's on them. You can't be that close to retirement and still be sunk in high risk, volatile stocks
I think they accumulated primarily their company stock over many years and were going to cash it in and move it to some type of conservative monthly income producer to go with their SS. Now their company stock has dived too low for them, so they'll have to work a little longer until it comes back up to an acceptable level. Not sure how long that will take though.
Here is one more quote for consideration (not that there are any shortages of people rightfully pointing out this craziness). Bill Ackman, a billionaire hedge-fund manager who’s a Trump ally, warned this could result in “a self-induced economic nuclear winter... This is not what we voted for.”
The long-term implications of what has been done both on the tariff front, coupled with the disastrous foreign policy is setting us up to be truly screwed when it comes to international trade. Combine with simultaneously working hard to deport a large part of our agricultural and construction workforce, while putting nothing forward to truly fix immigration so we can get people we need, and it's a great recipe for turning the world's largest economy into an also-ran. People like to conveniently forget that the Hawley-Smoot Tariff Act disaster is a big reason that the US ushered in FDR and much more government intervention, government subsidies and progressive ideas.
We are very much more an international economy now. Eroding trust with allies and watching them rush to establish better trade relationships with other countries is going to magnify all of these issues long term and take away our bargaining power.
As a reminder. Trump isn't conservative. Trump isn't Republican. Trump is a narcissist of the highest order. If you aren't a native American, you are an immigrant, or the descendent of one.
Ronald Reagan was a conservative and a Republican: "Other countries may seek to compete with us; but in one vital area, as a beacon of freedom and opportunity that draws the people of the world, no country on earth comes close. This, I believe, is one of the most important sources of America's greatness...You can go to live in France, but you cannot become a Frenchman. You can go to live in Germany or Turkey or Japan, but you cannot become a German, a Turk, or Japanese. But anyone, from any corner of the Earth, can come to live in America and become an American"
ETA: Last comment on this thread from me. Another guy with TDS:
JPMorgan CEO Jamie Dimon “The recent tariffs will likely increase inflation and are causing many to consider a greater probability of a recession,” Dimon warned in his annual letter to shareholders. “Whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth."
“America First is fine, as long as it doesn’t end up being America alone,” Dimon said. “If the Western world’s military and economic alliances were to fragment, America itself would inevitably weaken over time,” he said.
Dimon also pointed out that these forces are inextricably linked. “It is extremely important to recognize that security and economics are interconnected – “economic” warfare has caused military warfare in the past,”
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Agreed, but in theory the stock market represents a collective prediction on future earnings (not sure that's really the way it's worked the last decade and a half; I think it's just been the least bad place to park investments as everything was overpriced relative to predicted earnings). So the stock market drop in theory represents a collective prediction of where the economy is headed.
The current drop isn't even reflecting the worst case scenario, which is we are really trying to greatly reduce international trade in order to eliminate trade deficits in goods and neither congress nor courts not political pressure is going to stop that. Certainly there is some probability assigned to that, but I think this is mostly a prediction of "it's going to be bad, but political pressure will push him to rescind tariffs or this is an opening negotiating move and we will actually move to reciprocal tariffs (as in the normal definitino of the word, not the made up definition they are using) or get some other discrete policy concessions that will maybe result in some new tariffs, but just with the normal level of destructiveness that new taxes bring, not the pain that comes from trying to reorganize world trade. I think that last option is probably being assigned much less probability now that people have seen how they are defining "reciprocal". There's really no concession other countries could make that would even make sense in the context of how they are defining reciprocal. Not that Trump is bound by any logic or reasonableness in negotiating, so there is still some possibility that the tariffs have no real connection to what he claims he is looking for other countries to do. But not looking great.
On an inflation adjusted basis, the S&P 500 didn't recover for 6 years. https://www.gurufocus.com/economic_indicators/5860/inflation-adjusted-sp-500-index-price
That ignores that there were dividends paid out during that time, so if you were reinvesting dividends, it may have recovered in 4ish years?
I think there's still a good chance it will recover in less than a year (maybe even less than 6 months). But that depends on us changing course. If we don't, I'm thinking it will be longer than 4 or 5. If we keep them in place long enough to drive a serious recession, even if tariffs are lifted at that point, as we learned with COVID, you can't just flip the switch on the economy. When you throw an artificial wrench into it, it can break it in ways that take a little while to recover from.
Too early to tell. Things have to shake out on what we really commit to. This is all purely in response to chaos/uncertainty which can become more certain in relatively short time and the money pours back in. Although, the fact that POTUS introduces so much chaos in and of itself in inherently a bad thing for markets period. Investors and consumers hate chaos. Check out CCI...woof.
That is as of today. If tariff continue into next year like this, things won't be OK, as you say.
I truly think this is just a negotiating tactic by Trump to get better trade deals. He knows this is stupid and won't work.
I voted 1-3 years simply because we have more issues that aren't' just tariffs. The labor market cannot support a robust economy. That is a huge issue that tariffs being stopped don't address.
I think the stock market was overvalued last April and was shocked that it kept inching up until Trumps tariffs were announced.
I had my best year ever Biden's last year in my investments and it wasn't close. So far, this year. Trump cost me 1/3 of what I made last year and I got out before the big sell off the first of this month. Timing my buy back? Hmmmmm
The March 2020 COVID drop was fully recovered by July 2020, so I suspect we'll see about the same.
Maga's believe in Trump and think he was a great businessman and the economy was going to magically get better. I don't blame them, they believe in him and are willing to put their money where their heart lies. Stocks will come back but will it be 6 months to 6 years my only question.
Who do you know that can bankrupt a Casino that was profitable before he bought it?
He bought an airline, discount type airline, and proceeded to remodel all the plane's with gold seating to make into an upscale airline. Bankrupt them too.
Go look how many of his contractors have sued and won for non-payment? Trump simply will not pay people he owes. How is this good business? He does stay rich because of his Dad. His Dad set him up with so much wealth and real estate that income is always coming in.
Everybody knew the COVID disruptions were temporary. This is not remotely the same.
Do you honestly believe the majority of Trump's voters didn't know this ? Trump was running against the worst candidate with the most radical and unpopular agenda possibly ever. I acknowledge a core of "Magas" in the Republican party and until the Dems can somehow acknowledge they have a core of "sky screamers" (or whatever) in their party and the adults from both parties can somehow quit pandering to their extremes were going to continue going from one insane candidate to the next.
That was with us helicoptering money into the economy and while much of the damage came from teh completely unnecessary and unjustifiable "Covid" Stimulus under Biden and then was exacerbated by the Inflation "reduction" act, there was probably a good bit of inflation baked in at that point that wasn't reflected yet, so not sure how applicable that example is.
We printed $3 trillion and handed it all out in April - June of 2020 and started the years long inflation fire that followed to make that quick recovery. Let's hope it's not entirely the same.***
Trump haters are going to hate. I am on his side. The world needs us.
Example One: If this happens stock market will go up 3000 points.
https://www.politico.eu/article/eu-offers-trump-removal-of-all-tariffs/
Example One: If this happens stock market will go up 3000 points.
https://www.politico.eu/article/eu-offers-trump-removal-of-all-tariffs/
It’s really disconcerting that these are our choices and that we swing so drastically from one leadership to the next. How can any other country trust us when we swing policy so drastically every 4-8 years?
It doesn't swing as much as you think. Washington is full of long-time insiders. Status stays the same. This time is different and it's a big swing. Globalization is coming to an end. Countries and stock markets are going to have to adjust.
Investing in you company stock is extremely risky. If the company goes down, you just list your job & your savings.
Honestly, I’m the problem. I’ve ignored the increasing power grab by the executive branch over the last 40 years. I haven’t been involved in pushing my congressman to do their job and push back rather than Be party shills. I’ve largely just voted party line stuff and ignored the rest as “just politics”. The idea of someone like Trump being able to do what he’s done was not imaginable to me. I took our freedoms for granted and assumed we would never support someone who doesn’t defend them.
100% true, but a lot of people do it. I bought about 20% of my investments in company stock. Most like to do it because the company usually gives employees 10-20% discount on the current price. Just don't put all your 401k into company stock. At least diversify a little bit.
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