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Sanrith Descartes

Sanrith Descartes

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Jysin said:
Quoting myself, relevant link:

www.bloomberg.com

Post-Lehman Path Makes a Case for Buying the Rout

Anyone who bet on US stocks in October 2008, well before the market bottomed, would have been up 440% by the peak last year.
www.bloomberg.com www.bloomberg.com
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Them are some amateur numbers there...

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Sanrith Descartes

Sanrith Descartes

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1655491637611.png


Lets see...breadth isnt good. VIX still over 30. Zero good news besides oil dropping. Now, we do have a lot of put gamma expiring but people buying into it have got to realize the shit is just going to get moved out to the next expiry since (see all the reasons I previously listed).

I ain't buying it.

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Creslin

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A key difference when looking at all the s&p returns graphs when it enters a bear market is those guys looking at 08 or 2012 or 2020 and trying to talk up stocks always fail to mention the fed in those years flooded the markets with liquidity and this year they are doing the opposite making a quick v shaped rebound really unlikely.
 
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Mist

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Creslin said:
A key difference when looking at all the s&p returns graphs when it enters a bear market is those guys looking at 08 or 2012 or 2020 and trying to talk up stocks always fail to mention the fed in those years flooded the markets with liquidity and this year they are doing the opposite making a quick v shaped rebound really unlikely.
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Like I said a while ago, when the music stops they'll be all out of knobs to turn this time.
 
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Creslin

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Sanrith Descartes said:
Lots of big balls to be shorting heavy down this deep.

Click to expand...

We really aren’t down that deep though. If this was the bottom it would be one of the shallowest recessions in a long time especially for the S&P and Dow. I mean the Dow isn’t even in bear market territory yet.

it just feels deep because anyone invested in tech is down 30-40% which is pretty deep.
 
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Sanrith Descartes

Sanrith Descartes

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Creslin said:
We really aren’t down that deep though. If this was the bottom it would be one of the shallowest recessions in a long time especially for the S&P and Dow. I mean the Dow isn’t even in bear market territory yet.

it just feels deep because anyone invested in tech is down 30-40% which is pretty deep.
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A shitload of put gamma dropped today. We have a 3-day weekend and we closed green. Granted anything can happen in the next 3 days but I can easily see some sort of pop on Tuesday. Market fundamentals are still shit, but a day or two of green early in the week can fuck a lot of shorts.
 
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Creslin

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Sanrith Descartes said:
A shitload of put gamma dropped today. We have a 3-day weekend and we closed green. Granted anything can happen in the next 3 days but I can easily see some sort of pop on Tuesday. Market fundamentals are still shit, but a day or two of green early in the week can fuck a lot of shorts.
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Oh ya I short term I totally agree with you shorts are dangerous. We may even have a more extended rally with no real news for a few weeks. But I don’t think this is the bottom yet because I expect q2 earnings and forecast revisions to be brutal along with another rate hike in July and warning signs in real estate.
 
Sanrith Descartes

Sanrith Descartes

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Creslin said:
Oh ya I short term I totally agree with you shorts are dangerous. We may even have a more extended rally with no real news for a few weeks. But I don’t think this is the bottom yet because I expect q2 earnings and forecast revisions to be brutal along with another rate hike in July and warning signs in real estate.
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I don't call bottoms or tops. But I will say that like everything, some stocks are over sold and the S&P 500 PE is down to 18.5 which is 2007 recession area. We can and might keep falling, but I can't see it dropping another 15 or 20%. I think we are.in the neighborhood. Until the next black Swan event hits us next week.
 
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Gravel

Gravel

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Hmm? Seems like the floor has quite a ways to go to me. I know GAAP skewed things, but even in the post-2000's era we still have room to fall. And then consider we still have the massive leverage problem the Fed put us in that is completely unprecedented.

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sp-500-forward-12-month-pe-ratio.png


Also found this link useful with all kinds of analysis.

www.currentmarketvaluation.com

Price/Earnings Analysis Indicates Stock Market is Overvalued

The P/E ratio of the S&P500 shows that the market is currently 79.2% overvalued compared to historical norms.
www.currentmarketvaluation.com www.currentmarketvaluation.com
 
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Sanrith Descartes

Sanrith Descartes

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Gravel said:
Hmm? Seems like the floor has quite a ways to go to me. I know GAAP skewed things, but even in the post-2000's era we still have room to fall. And then consider we still have the massive leverage problem the Fed put us in that is completely unprecedented.

View attachment 417760

sp-500-forward-12-month-pe-ratio.png


Also found this link useful with all kinds of analysis.

www.currentmarketvaluation.com

Price/Earnings Analysis Indicates Stock Market is Overvalued

The P/E ratio of the S&P500 shows that the market is currently 79.2% overvalued compared to historical norms.
www.currentmarketvaluation.com www.currentmarketvaluation.com
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Short of nuclear war or 1776 the sequel, I gotta think the majority of really bad shit is already in play at this point. At some point we get some sort of peace in Ukraine/New Russia. That helps the market by providing finality to an unknown.

Granted the biggest issue left might be Taiwan, but a CCP invasion of Taiwan brings us to a shooting war one way or another. Either we engage China or if we do nothing 1776 pops off. So from a market perspective it's a game ender.
 
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Creslin

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Sanrith Descartes said:
Short of nuclear war or 1776 the sequel, I gotta think the majority of really bad shit is already in play at this point. At some point we get some sort of peace in Ukraine/New Russia. That helps the market by providing finality to an unknown.

Granted the biggest issue left might be Taiwan, but a CCP invasion of Taiwan brings us to a shooting war one way or another. Either we engage China or if we do nothing 1776 pops off. So from a market perspective it's a game ender.
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The really bad shit ya but all the little bad shit still to come like earning revisions and weak housing market. And we are still tightening and the market has priced in at what the fed has said or a bit less so it depends on if you think a 3% is a fed rate can stop inflation. Personally I don’t and think we have the risk of rate shocks like we had in June every month as CPI continues to run really hot.

I still go back to the analogy of 2000 since I think that is such a similar bubble and back then the s&p took forever to chop its way to the bottom though we did have 9/11 in there. Most recessions see bottoms in the -30 to 40 percent range and I just can’t see it not being the case this time. And that’s my optimistic view.

My pessimistic view is this will be way deeper as we pumped so high and wouldn’t so much say the fed is out of bullets rather they have turned the gun on the economy.
 
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