Screwball

Another example; no N in FANG anymore (publicly traded edition)?

From 700 to 166 in 6 months.  Ouch!

They have been overpriced since they started, and I'm not saying they were not worth something, but their business model depended on poaching. Without the "last mile" they are toast (like many others).  Plan your NFLX position accordingly. 

Notice this is from August of 2021.

When you have pictures of rocks selling for 1.3 million dollars, somethings seriously fucked up.  And it has gotten more crazy than that since.

And now some of that idiocy is taking a big shit.  Imagine that.

I honestly have a hard time believing what I see today.  But I'm crazy so that helps - and I have a good time.  h/t Joe Walsh

There is an entertainment value to the now popular crypto vs. tulip parallel.

4 hours ago, Deleterious said:

I really enjoyed that movie.

 

I never heard of it, but a buddy gave me a CD so I spun it up and watched it last night. Covers all the angles from Ford Motor Company to the racing world, and the people who participate. I thought it was well done, and with Bales and Damon chances are it will be pretty good.

Mid 60s, muscle car era. It's easy to make them go fast, but in the road course environment they also have to brake.  And go 200 mph.

I did some research to see how accurate the move was to real life.  One story I ran across was a guy who wanted to buy a GT40 at the local Ford dealer.  He told the dealer he didn't want the 289.  He wanted the 427.  OK, so he test drove it, scared the shit out of him, and once back to the dealer said, "maybe I should get the 289.

That was the 289.

Racing related.  From 2019.  Some have probably watched this.  I thought it was really good.

This caught my eye today.  I don't know how this picture will look so we'll see. The market gapped down and went south until around noon, then fiddled around and made the days low at 3:21.

I don't remember how much the market was down at that time, but it was a bunch.  FTR, I use the S&P.  At 3:50 pm it printed a 32.17 increase in one minute.  I would have to do the math, but what kind of money would it take to do that?

Probably above my pay grade, but that is wild.

3 hours ago, Deleterious said:

I always wonder about the few green ones on days like today.

Some call this a stock pickers market.

And then some.

I haven't watched any of the Fed pressers in a long time other than a little today.  But I got curious today and did a little poking around.  The Fed announced an open ended buying of MBS  March 15, 2020.  If you look at the chart below, it is the exact day where you see a bubble that says 2191.86.  Then look up and to the right and you will see a bubble that says 4818.62.  That is Jan 4, 2022.

That is a 3 year chart.  As you can see, once you get to the top bubble, the market turns over.  So what happened on the day of the second bubble?  The date is Jan 4th.  Did anything happen that day?  Yep.

Dow drops nearly 400 points in first loss of 2022, as traders brace for a more aggressive Fed

The money line;

Quote

Rates also jumped, putting pressure on equities, after the minutes from the Federal Reserve’s most recent meeting showed the central bank has discussed reducing its balance sheet shortly after it raises rates later this year. 

Discussed reducing it's balance sheet... All 9 trillion of it.  For context, a 5 year chart.

Their balance sheet has expanded from 4 to 9 trillion (rounding) in the last 2 years.  I wonder how much the total MBS purchases (over a trillion) actually add up to, and what we accomplished for creating all this money (I guess, since this isn't bonds, the debt isn't monetized, so where did it come from?).

One thing we did was send the S&P some 2600 points higher, or quick, someone do the math - 120% if you hit bottom to top.  And this is only a 2 year run.  Ain't that friken sweet?

Sure, but for who?  How many people doubled their money in the last two years? Guessing it ain't most of us.  And now they are talking about more rate hikes, limiting MBS purchases - in other words - taking away the punch bowl. Usual policy says when inflation is running hot you raise rates.

The market expected 50bp, got it, then ripped to the upside, along with the rip went commodities, with crude closing around 108.  Not helpful.

We'll see where this goes, but the Fed has a market that turned over while we have a 8.5 inflation rate and a last quarter -1.4 GDP.  Who you gonna save?

Sure as fuck won't be us chumps.

Purchasing MBS started in 2009 when the bankers blew up the world, ended in 2010.  Re-started in 2020 due to COVID, still going, and I don't think the dual mandate of the Fed includes being a home building cop.

17 minutes ago, Tiger337 said:

I understand why they dropped when Covid hit, but I wondered why they started dropping in Summer, 2019.  

From that bank rate article.  The text is kind out of sequence, but the point valid.
 

Quote

 

The Fed couldn’t escape zero rates in the 2010s just as much as it couldn’t escape devastating recessions.

Officials would ultimately end up leaving interest rates at rock-bottom until 2015, after which they only hiked interest rates by 25 basis points once per year. That is, until 2017, when the Fed hiked three times, and 2018, when they hiked four more times. The fed funds rate peaked at 2.25-2.5 percent.

Facing tepid inflation and moderating growth, the Fed also decided in 2019 to cut interest rates three times to give the economy a fresh boost — similar to Greenspan’s “insurance” cuts of the 1990s.

The fed funds rate looked like it was about to settle there until the coronavirus pandemic came along, ushering back in another era of near-zero rates. The Fed slashed rates to zero across two emergency meetings within 13 days of each other as the gears of the economy came to a halt.

Chair Janet Yellen took the helm of the Fed from Bernanke in February 2014 and steered the economy through its Great Recession recovery until February 2018, when Chair Jerome Powell was installed.

 

Speaking of the Fed, can anyone explain why they are buying MBS to begin with?

1 hour ago, Tiger337 said:

S&P 500 up almost 3%.  That is surprising. It usually goes down when the Fed speaks.  

First, I have to correct myself.  Above I posted "Once COVID hit they had to raise rates."  Should read "lower."  My bad.

****

To address this, it was fun to watch.  No chart porn here, so I have some.  Today's S&P by the minute. The two cyan lines are the Fed release at 2pm, and the start of their presser at 2:30pm.  I watched part of it.

Adding to Del's point;

A link to their unwinding plan;

Plans for Reducing the Size of the Federal Reserve's Balance Sheet

Powell spoke until almost 4 if I remember right.  What the market was looking for is the QT numbers.  Everybody expected 50bp, some wanting/guessing 75.  I don't know what the Street was expecting for the reductions in monthly buying, but the way the market acted, the may have been on the dovish side.

1 hour ago, Tiger337 said:

Just the person I wanted to see here.  Why did they raise the rates in 2018 and then bring them back down in 2019?    

Fed’s interest rate history: A look at the fed funds rate from the 1980s to the present - from Bankrate. com

New Fed head approves first rate hike of 2018 - from CNBC

FTA;

Quote

 

The Federal Reserve voted Wednesday to raise interest rates by one-quarter of a percentage point, in the central bank’s first policy meeting led by its new chairman, Jerome "Jay" Powell.

The move marks the first rate hike for 2018, bringing the benchmark interest rate to a range of 1.5 percent to 1.75 percent due to a "strengthened" economic outlook, said the Federal Open Market Committee in a statement. But it won’t be the last rate hike this year — the Fed has already penciled in three increases, with a fourth one also likely, depending on the pace of economic growth.

 

2018 was before COVID and the economy was hot.  Once COVID hit they had to raise rates.

We will find out in about a half hour how big their balls are in today's world.

Anyone who thinks the Fed made rate decisions based on Trump is a fucking idiot.

I think the 10 yr did touch 3% today.

From that AP article;

Quote

That’s why Powell and other Fed officials have said in recent weeks that they want to raise rates “expeditiously,” to a level that neither boosts nor restrains the economy — what economists refer to as the “neutral” rate. Policymakers consider a neutral rate to be roughly 2.4%. But no one is certain what the neutral rate is at any particular time, especially in an economy that is evolving quickly.

That is a sample of bullshit from the article trying to explain the clueless Fed wizards trying to manage something they cannot manage, and haven't for a very long time.  Slow learners, but our system.

It appears the bond market is starting to agree with that assessment.

But they have a problem; They blow up the everything bubble or they starve half of America.  Your move.

1 hour ago, Tiger337 said:

Welcome back Srewball! It's good to see you here.

They did start raising rates in 2018, but I think Wall Street didn't like it, so it didn't last long!

 

Thanks Lee.  Hope you are well.

I followed the migration but just watched from a distance.  I had to sign up to thank Biff in the advise thread so while I was here...

I'm kind of disappointed with this thread - no chart porn.  🙂

And screw the banksters.

On 4/6/2022 at 10:09 AM, Deleterious said:

They are predicting an 80% chance its 50bps.  About three years late though.  They have a 50 story high rise on fire and they are trying to put it out with glasses of water from the kitchen sink.

Love it!!!!

My over/under is 2 hikes.  They are scared shitless.

37 minutes ago, Tigeraholic1 said:

Is this French for the boom boom room?

When you are my age there isn't much booming going on.

It is a room in the corner of the house and garage.  It was a back porch slab when the house was built, but now an enclosed room that I totally remodeled.  It has two outside walls that have windows I can crank up which are also screened to keep the bugs out.  A ceiling fan, TV, stereo, chairs, table, and made up to look like a beach house.  Complete with sea shells, driftwood, sand, fishing pole, and boat oars (mounted on wall) and a large map on one wall of Clearwater Beach in Florida.  I did have a kegerator in there but draft beer got to expensive.  So there is a lot of fun going on there while staying clothed.

I have a satellite & external antenna feed to the TV but sometimes I take the laptop and hook into the TV to stream something off the computer.  At night when our lines are busy I have buffering issues.  This should fix that.

It will also allow me to mount another security camera over the driveway, which I couldn't do before due to lack of signal.  I can mount it on the dish mount and I have a solar panel to charge it since it will be up in the air.

These things made me so happy I had to drink a few beers. 🙂  I drank two, just for Biff.

On 10/21/2021 at 2:03 PM, Biff Mayhem said:

Mesh WIFI. You'll thank me.

I’m here to thank you.

I didn’t know there was such a thing until I read that.  What? Really?

I’ll give you a consumer report kind of thing. I have WIFI issues – dead spots where I don’t want them.  I’m on physical cable coming in the front corner of my house. Spectrum, used to be Time Warner. Cornhole, Ohio, so we don’t have the last mile good stuff.  My 60 buck plan a month gives me a 20 Mbps connection. Sometimes I get more, other times not, depending on time of day.  For reference.

I want to expand my WIFI to a back room just out of the main house, and the garage as well. You know, party central.  I also have security cameras.  Two in the front of the house, and two in the back.  The ones in the front work pretty good. When you get an alert, you want to hook into the camera and see a live shot. You can do it with your phone from anywhere if everything works. Since the ones in the front are closer to the router, I can get a visual in not too much time.  In the back – not so much - if at all.  Too far from the router.

If something is going goofy – time matters.

I researched that system and said – yea – that makes sense.  So I pushed the button.  Came in today, so off we go.  But before I killed the old router, I went around the house with my phone and checked speeds.  I used xfinity speed test.  I took 4 readings.  1) in the same room with the router. 2) far corner of my basement. 3) out of house back room with the door shut. 4) far end of my garage from the router (doors shut).  I took multiple readings over an hour or two.

Router room = 40

Basement = 40

Fun Room = 30

Garage = 15-20 (at least 5 tests)

I ran at least 3 for all of them.

Install new system. Followed directions, didn’t take long.  You hook up the main router first, then the other two takes care of themselves. You might have to fiddle with a few things, but painless. Once I could see everything was working, I took another speed test.  Router room = 70. WTF? That’s what it said, and so did every other place in the homestead.  Unreal!

I had an old Belkin router.  I don’t know what changed, but I’m sure glad it did. This is sweet.

Might be the best 130 bucks I ever spent.

Thank you!!!!