Shonuff
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Investing General Discussion
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Guest, it's time once again for the massively important and exciting FoH Asshat Tournament!
Go here and give us your nominations!Who's been the biggest Asshat in the last year? Give us your worst ones!
Shonuff
Mr. Poopybutthole
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He didn't say 5 years. He said energy, financials, travel and some industrials will outperform next year.
Its overdone. I mean, for God's sake, the price of oil is so low that it assumes no air travel anywhere in the world for three months straight.
I bought a bunch of energy, financials and travel after reading JP Morgan's note on how bad the sell off was. If you are thinking there will be no flights anywhere on the planet for three months, I have a bridge to sell you.
Big Phoenix
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Sanrith Descartes
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Sanrith Descartes
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Gravel
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How is inflation off the table? Fed just announced 3 plan rate hikes. Inflation hasn't even started.
Zog
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Most profits were from business travel and high dollar seats, corporate America has already moved away from business travel and embraced digital meetings.
The last any corporate entity is to go "let's start spending more money on meetings when our profits are going to start shrinking."
You'll need low energy costs to make anything on cheap seats. If tom is right then the airlines will continue to be unprofitable and rely really on holiday travel to make up for the rest of the year and that ship has sailed until next year end and after 2 years of getting shit on, i guarantee they will be in debt up to their eyeballs by November 22.
Shonuff
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Semantics. Inflation is being dealt with using a double taper. Not completely dealt with, but more than before.
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Zog
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The article from Peter Schiff is spot on i think, a dove can't change his feathers.
If the fed was serious about inflation, they wouldn't keep buying assets and pouring just a little bit less gasoline on the fire.
Gravel
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I guess you have more faith in the Fed than I do (or maybe I should say Lee does).
I think we're finally at the point people have been waiting a decade for, where the Fed interventions finally don't have enough away and it all comes tumbling down. I think at best, they may be able to deter a complete collapse, but it's going to be incredibly painful still. Likely the worst economic collapse in US history.
LachiusTZ
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Shonuff
Mr. Poopybutthole
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One of my Finance professors at Penn State (undergrad) was a member of the Fed, so I might be a little biased. He was a member of the old Fed though, one that didn't care about employment, just about curbing inflation. This new Fed with their dual mandate is a bit different. I can remember sitting there and him saying the Fed didn't give a damn about employment numbers, that inflation was the most important thing to the Fed.
Still, I agree with Tom Lee that this is a risk on move. And the Fed does reserve the right to get more intense about hiking. Powell does have to pass the confirmation process next month still. He still has to pass the hearings.
Sanrith Descartes
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The Fed does care about inflation. However, what the Fed cares more about is Government borrowing costs. There is a $2T spending bill one vote from being passed. Our Government in its current form cannot survive interest rates at 2, 3 or 5%. The interest charges would kill them. Congress has fucked us into a corner without a way out. Im not making this a political derail but the Coronachan debacle was mishandled as well as it could be mishandled in terms of keeping our country solvent. There is no way to deal with the massive amount of dollar printing that happened the last 24 months. Except of course 20% interest rates and that bankrupts the government with its debt burden.
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Gravel
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I guess it depends on what they do. If they raise rates and we have a crash, will they stay on course? If so, there may be hope. If they lower them again we just kick the can down a bit further and the market finally realizes that we're a ticking time bomb.
Edit: And like Sanrith said above, we really need to figure out how to lower the total debt. I know the government generally doesn't care about that, but it's starting to get out of whack similar to the Japanese lost decade. We need to bring it back to where we can raise interest rates without bankrupting ourselves with interest payments.
Edit: And like Sanrith said above, we really need to figure out how to lower the total debt. I know the government generally doesn't care about that, but it's starting to get out of whack similar to the Japanese lost decade. We need to bring it back to where we can raise interest rates without bankrupting ourselves with interest payments.
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Sanrith Descartes
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I was one penny from being stopped out of DOCU. Day is still young though.
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Sanrith Descartes
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