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Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.

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Does the market know something we don’t?

The odds of a regional war, a government shutdown, the nomination of a 4 time indicted grifter, the inability of one of the two major parties to govern, the next downgrade of U.S debt are all increasing by the hour. Labor strife is everywhere, the real estate market is coming to a grinding halt, you get the idea. How is the market hanging in there under the current circumstances?
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Comments

  • A few things come to mind:
    1) Consumers are still spending. What inflation?
    2) US markets will always attract cash from all over the world. Still viewed as most solid and stable.
    3) If asset bubbles were to burst, the perception is that they will re-inflate soon enough thanks to a meddling Fed intervention.
  • edited October 2023
    Factoring in current events, the "market" has been incredibly resilient this year.
    The recent Fed’s Survey of Consumer Finances indicated the median net worth
    of American families climbed 37% between 2019 and 2022 after adjusting for inflation.
    Consumers were in a strong financial position which allowed continued spending in 2023.
    It will be interesting to see how the "market" reacts if/when spending materially deteriorates.

    American Household Wealth Jumped in the Pandemic
  • Hey guys,,,,, you answered my question. Much appreciated. Consumer spending will overcome whatever else might happen.
  • Yeah, not to mention the incompetent buffoon crime lord we have sleeping in the White House, with all his grossly inept, corrupt appointees running the country into the ground.
  • edited October 2023
    “How is the market hanging in there under the current circumstances?”

    “… strings and ceiling wax and other fancy stuff”

    But I’m not certain your original premise is fully accurate. A check of Bloomberg shows all 3 major indexes well below their 52 week highs. Until yesterday the Dow was actually in negative territory for the year. And if you compare the Dow to where it was 2 years ago, it’s substantially lower.

    DJI close on October 29, 2021 35,816
    DJI close on October 24, 2023 33,141


    (*Quotation from ”Puff the Magic Dragon”)
  • We might be stuck in the "malaise" period for equities. After accounting for inflation, the real returns might not be kind.

    Bonds could easily end up outperforming equities these next few years, though long-term bonds might endure some additional pain as 2023 closes. Heck, bonds might steal the show in 2024.
  • Starting to think when and at what point do folks throw in the towel and say no mas? Boomers have most of the shekels...why fart around when you can lock in 5% plus for the next year or two or three ..markets way overvalued, especially you look at apple at 30x with no growth for two years or something....when the giant flow machine reverses when folks start losing their jobs, whoosh look out below...

    I'm looking at funds like MRFOX, PVCMX, LOGOX. That don't hold a ton of the widely held index funds top stocks...truth be told, very small portion of portfolio likely just doing it out of habit. Mostly in tbills and CDs

    Wondering if we'll go back to the 60s savings, no screwing around in the casino with your life savings... how are companies going to roll over debt when they need to refinance at higher rates?
  • how are companies going to roll over debt when they need to refinance at higher rates?

    The debt/equity ratio is now a feature in all my screens on MFO premium. I'm also looking for good Martin ratio numbers.

    Like you, I am looking for opportunities where the return hasn't relied on the usual suspects.

    For those unfamiliar with the Martin ratio, here is the definition from MFO premium:
    Like Sharpe and Sortino, it measures excess return, but relative to its typical drawdown. After the 2000 tech bubble and 2008 financial crisis, which together resulted in a “lost decade” for stocks, investors have grown very sensitive to drawdowns. Martin excels at identifying funds that have delivered superior returns while mitigating drawdowns. It too is best used when comparing funds of same category over same evaluation period – this very comparison is the basis for determining a fund’s MFO Rating metric.
  • rsorden said:

    Yeah, not to mention the incompetent buffoon crime lord we have sleeping in the White House, with all his grossly inept, corrupt appointees running the country into the ground.

    The incompetent buffon crime lord lost the election in 2020 and is no longer in the White House.
  • edited October 2023
    Pessimism is rampant.

    Heck, with headlines like “The lights have all turned red”, “Nobody wants mutual funds now”, “Into the dumpster”, “Fidelity has ‘disappeared’ Dodge and Cox”, and “…Total Return fund will be liquidated” - what would you expect?

    Cheers!
  • An old cliche is that the market hates uncertainty. Everywhere you look uncertainty is rampant. One of the two parties that runs things is operationally and morally bankrupt. The basic rule of law no longer is the cornerstone of our democracy . Two real wars rage out of control. These issues are way beyond consumer spending and the ebb and flow of market returns.
  • edited October 2023

    rsorden said:

    Yeah, not to mention the incompetent buffoon crime lord we have sleeping in the White House, with all his grossly inept, corrupt appointees running the country into the ground.

    The incompetent buffoon crime lord lost the election in 2020 and is no longer in the White House.
    Perfectly stated.
  • "Then i fumbled in the closet, through my clothes, and found my cleanest dirty shirt..."
    ---K.K.

    That's what the US has become: the cleanest dirty shirt. MAYBE. But the economy is not so very tied to politics, anymore than politics is tied to Ethics. Check out the fabulous new, shiny House Speaker yet? More of the same from out of there, only worse.

    Meanwhile, I've geared myself to hold back expectations until at least 2025. In between now and then, there's stuff on sale to be obtained.
  • @rsorden: The incompetent buffoon crime lord lost the election in 2020 and is now facing 91 counts of criminal activity.
  • @Old_Joe The biggest issue facing America in 2023 may be that almost half the country supports the “crime lord” who lost the election in 2020. That is THE ISSUE of our time.
  • larryB said:

    @Old_Joe The biggest issue facing America in 2023 may be that almost half the country supports the “crime lord” who lost the election in 2020. That is THE ISSUE of our time.

    I tend to agree. No soul. No ethics. Empty shell. And they flock to him.

    Orwell: "With enough beer and football, they were easy enough to control."

    Uncle Adolf, to Lord Halifax, 1937: "Shoot Gandhi, and if that does not suffice to reduce them to submission, shoot a dozen leading members of Congress; and if that does not suffice, shoot 200 and so on until order is established. You will see how quickly they will collapse as soon as you make it clear that you mean business."

    Trumpster: "I could go out on 5th Avenue and shoot someone and get away with it."
    (Let us hope the Orange Disgrace cannot wiggle out of all of the charges against him currently!)
  • Agree with @Old_Joe. It is a slow train wreck in GA case and rope only tightens.

    I try to ignore the news as the titles are silly. Fact is that the bond vigilantes is back and demanding higher yield while the earnings are mixed (and expensive). Few bright spots in bond. Otherwise, there are few opportunities out there.
  • Its comforting to know that others share a similar view. I view Trump as one of the biggest threats to the safety and security of this country, and yet he still has his many "loyalists". Amazing times. It's no wonder politicians view us as sheeple.

  • edited October 2023
    Trump and his ilk present a clear and present danger to society/democracy.
    This minority seeks to impose their ideology (and curtail freedoms)
    on the entire population via the legislative process.
    The sheer power craving and authoritarian tendencies are troubling to say the least.
    Unfortunately, we only have two major political parties and one of them is now utterly dysfunctional.
    It astounds me that so many of my countrymen still support this scoundrel.
    Perhaps current judicial proceedings will finally hold Trump accountable for his criminal activities?
  • prizewinning comedy

    Kenyan

    You really should leave
  • prizewinning comedy

    Kenyan

    You really should leave

    Agreed.
  • edited October 2023
    If the U.S. is in such dire straits, what is the fascination with U.S. government issued / government backed paper? What gives you confidence that this government’s Treasury Department would make good on those T-Bills 3, 4 or 5 years out? What makes you think the FDIC wouldn’t be corrupted by than and your “government backed” CDs held worthless?

    Is it wrong to assume that your chances of getting your money back are at least as good as (and possibly better than) those government “guaranteed” pieces of paper if wisely invested among a portfolio of good corporations? And if your machinations about this country’s future are dark and foreboding, why not move some of your assets abroad to safer havens? Foreign domiciled companies? Swiss francs? How about hard assets like gold and silver or real estate?

    Even a badly adrift thread like this might lend itself to some serious discussion of investible assets.
  • How typical. How very predictable.

    Step One: @rsorden and @Baseball_Fan feel free to destroy a completely non-partisan financial conversation by injecting scurrilous and vile political comments. This is OK for them though, because this is America and they are free to say whatever they want, no matter how inappropriate to the circumstances.

    Step Two: Other MFO members respond to the provocation, and @rsorden and @Baseball_Fan then loudly complain the MFO is a nest of left-wing commies whose agenda is nothing less than to destroy America.

    What a couple of complete assholes.
  • I agree with O_J somewhat. Political BS should be moved to OT. Why it hasn't gone bye bye yet ? Did it need to be flagged first ?
  • @Old_Joe...like a typical lefty, TDS infected loon, you fail to see the facts. You attack me for " injecting scurrilous & vile political comments" when I was just adding additional FACTS to the initial post of this thread that mentioned "the nomination of a 4 time indicted grifter" yet once again failed to mention the underlying cause of the nations many issues, 99.9% brought on by this total failure of mound of skin & bones that occupies the White House 1 or 2 days a week.

    And yes, MFO has become a den of leftist hatred for anything common sense because of folks like you that can't keep you lefty nonsense to yourself and stick to discussing investments. You really need to see someone for your condition, TDS has infected your entire life.

    And I do enjoy soooo ruffling the snowflakes here...it's actually quite hilarious to read what utter buffonery they come up with to try & blame everything on the Orange Manace. You have no idea how hard I am laughing as I write this.
  • And another thing @Old_Joe, it shows alot about you as a person, your character, and your lack of both intelligence & class, that you resort to name-calling & vulgarities. That 3rd grade public education on display here.
  • @Derf- Why should a perfectly reasonable conversation between MFO members be removed from the financial section because of the destructive conduct of two people who obviously have no regard for MFO or it's members?

    If there are continued egregious violations of conduct here, from either side of the political spectrum, the people responsible should be not allowed to post except in the OT section.
  • @Old_Joe Agreed...so your out, as is larryB, Observant1, Crash, davidmoran, Baseball_Fan, and myself. You started it, so stick to your guns & disappear, loser!
  • Here is a simple solution to the MAGA among us problem. Just ignore them. Just ignore them.
This discussion has been closed.