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Tesla, Twitter and Whole Foods portend the end of the bull market.
MGLICKER
Posts: 7,995 ✭✭✭
Though the combined market cap of the three is only about 10% of market giant Apple, each had a significant negative move this week.
These are a few of the current darling stocks. Tesla is the dream car that never really will be.
Twitter is mostly dot com bubble bust part II era hype, that is a cool platform but will never produce real ad income.
Whole Foods is a nice chain, but in a prolonged era of shrinking real family income, $7.00 a pound for tomatoes or strawberries no longer flies.
Farewell bull run, it was bogus at best, and got pulled up much more than it got pushed up.
Where the collapse will leave PM's is any ones best guess.
These are a few of the current darling stocks. Tesla is the dream car that never really will be.
Twitter is mostly dot com bubble bust part II era hype, that is a cool platform but will never produce real ad income.
Whole Foods is a nice chain, but in a prolonged era of shrinking real family income, $7.00 a pound for tomatoes or strawberries no longer flies.
Farewell bull run, it was bogus at best, and got pulled up much more than it got pushed up.
Where the collapse will leave PM's is any ones best guess.
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Comments
I have a friend who is higher up in Whole Foods and she is not investing any more in the Company she works for after yesterdays 20% drop because of forecasted competition that she feels they will no longer to be able to compete against.
<< <i>Nice tie in to keep it PM related LOL.
I have a friend who is higher up in Whole Foods and she is not investing any more in the Company she works for after yesterdays 20% drop because of forecasted competition that she feels they will no longer to be able to compete against. >>
Interesting. They are the gold standard in their category. I used to shop at a Whole Foods weekly. Prices just became unmanageable on an everyday basis.
MJ
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
yes, but when they themselves say/admit they wont be able to compete going forward that's a dagger in their own heart. Did they think they'd be rewarded for being honest? lol
<< <i>Interesting. They are the gold standard in their category. I used to shop at a Whole Foods weekly. Prices just became unmanageable on an everyday basis.
yes, but when they themselves say/admit they wont be able to compete going forward that's a dagger in their own heart. Did they think they'd be rewarded for being honest? lol >>
Certainly refreshing.
<< <i>
<< <i>Interesting. They are the gold standard in their category. I used to shop at a Whole Foods weekly. Prices just became unmanageable on an everyday basis.
yes, but when they themselves say/admit they wont be able to compete going forward that's a dagger in their own heart. Did they think they'd be rewarded for being honest? lol >>
Certainly refreshing. >>
Smart actually. They got all their dirty laundry out in the open with weaker forward guidance. Now they really have six months to get their organic duck eggs all in a row. Plus, if they beat weaker guidance the stock stands to get rewarded. They were punished fully for next quarter.
MJ
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
whole paycheck.
<< <i>Whole Foods=
whole paycheck. >>
On many items like fresh seafood and fresh produce that is very true. They are quite competitive though on their high quality private label products. Seems like the direction that they plan on expanding. It will be tough to sell premium priced products though, in many channels of retail as inflation soars and disposable incomes at the 99% level remain stagnant.
Liberty: Parent of Science & Industry
<< <i>Interesting. They are the gold standard in their category. I used to shop at a Whole Foods weekly. Prices just became unmanageable on an everyday basis.
yes, but when they themselves say/admit they wont be able to compete going forward that's a dagger in their own heart. Did they think they'd be rewarded for being honest? lol >>
Sounds like a plan to go private for cheap...
<< <i>
<< <i>Nice tie in to keep it PM related LOL.
I have a friend who is higher up in Whole Foods and she is not investing any more in the Company she works for after yesterdays 20% drop because of forecasted competition that she feels they will no longer to be able to compete against. >>
Interesting. They are the gold standard in their category. I used to shop at a Whole Foods weekly. Prices just became unmanageable on an everyday basis. >>
Best cure for high prices is high prices. Such a simple concept yet so misunderstood. Crazy eh?
Knowledge is the enemy of fear
I've spent a ton of cash in whole foods over the years. Unfortunately for them, I was meeting a guy from craigslist that was slowly selling off all his junk silver because he was unemployed. There is area out front with about 6 tables with chairs around them. I never spent a dime in the store itself , the place was full of hipster doofuses it gave me the creeps , the table area was well lit though .
Thanks for your service , whole foods
I like tesla as an idea , the company is bumping up against a lot of entrenched cronies in their efforts to sell direct. Even if they fail , any small thing they can do to make life difficult for the scummy auto sales industry is a bonus.
<< <i>I never spent a dime in the store itself , the place was full of hipster doofuses it gave me the creeps , the table area was well lit though . >>
Certainly not the run of the mill Kroger crowd, that is for sure.
Fortunately our closest store is in a less doofussy part of town.
<< <i>
<< <i>I never spent a dime in the store itself , the place was full of hipster doofuses it gave me the creeps , the table area was well lit though . >>
Certainly not the run of the mill Kroger crowd, that is for sure.
Fortunately our closest store is in a less doofussy part of town. >>
Sure but you are in a red state
<< <i>Sure but you are in a red state >>
Good point, though Tucson is fairly liberal.
Once entered a Whole Foods type place outside of Los Angeles. Seemed like the Outer Limits.
<< <i>Though the combined market cap of the three is only about 10% of market giant Apple, each had a significant negative move this week.
These are a few of the current darling stocks. Tesla is the dream car that never really will be.
Twitter is mostly dot com bubble bust part II era hype, that is a cool platform but will never produce real ad income.
Whole Foods is a nice chain, but in a prolonged era of shrinking real family income, $7.00 a pound for tomatoes or strawberries no longer flies.
Farewell bull run, it was bogus at best, and got pulled up much more than it got pushed up.
Where the collapse will leave PM's is any ones best guess. >>
End of bull market??
Im long aapl, mcd, jnj, qcom, aet, pru , cvx, ge , so its still a bull market for me. Long term unrealized gains.
Im actually nibbling on a couple you mentioned at these levels.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
Over the years, the precious metals forum runs about 80% permabulls for precious metals, with a smaller percentage, but a majority that are permabears on the U.S. stock market or that avoid it completely. Deviations from those readings tend to be much more useful and interesting than the prevailing opinions of the forum. If the thread was dominated by dyed-in-the-wool precious metals folks buying U.S. stocks (ex-gold miners) it would be a lot more interesting information, and give a much bigger chance for a stock market top.
Has there ever been a more tepid response to new all time record highs in the Dow Jones Industrial Average? Most stock folks I know, and I know more than a few, are skittish, defensive, waiting for a shoe to drop (Ukraine to explode, Greece to default, a U.S. bank holiday, etc). I don't believe that I know anyone that is a raging bull on the stock market. I'm sure there are some in the press, or with newsletter subscriptions to sell, but those are far different groups with different motivations than people investing their own money.
There are so many heroes wanting to call the stock market top. As I often write, calling top is a low percentage game, no matter if it is a top in metals, real estate, bonds, or stocks. Calling top can be an entertaining game, and fine for those looking to have fun. It is not something worth spending much time or energy on, unless a person shows an uncanny knack for pulling the rabbit from the hat.
I agree with most of what you are saying. In our closed and manipulated stock market, there seems to be little real excitement, beyond some of the frothy Nasdaq issues that is. It reminds me of the top of gold at $1900, where few but the conservative radio talk shills where excited about $2000 gold.
Blue chip stocks have become proxy for 10 year notes with a dividend yield of a touch below 3% on both. Seems that when the Feds now drive up bids on the market through their Wall Street buddies now, the money hits the top high cap names and misses the 600 P/E speculative issues.
Unless interest rates decline significantly from here, we appear to be at a top.
With the Feds seemingly successful ability to keep rates from 0%-1% in the shorter term markets for 6 years, many are lulled into a false sense that the powerful fed has full control of across the board interest rates. This is true until it is not true.
Looking at Russia for example, as the war of words between Putin and the West intensify, Vlade could easily dump his holdings of $3,000,000,000 in Dollar reserves. A quick mouse click could hammer the dollar and cause a hefty jump in rates.
Same is true of Japan which holds $1.5T of our debt, and though an ally, is in deep fiscal trouble and may have to sell some of this paper to cover their own $250k per citizen debt load. Ditto China which is sitting on a powder keg of debt.
More importantly though, with real CPI at 6% plus per year, investment dollars will pile into commodities and cause an inflation spiral which will make low rates untenable.
Judging by your consistently bearish posted sentiment.
My sense is you have been out of the stock market a longtime I'm thinking.
If so why don't you tell us what you have learned and missed in your analysis and perhaps done differently to have
made some money in stocks ??
I give away money. I collect money.
I don’t love money . I do love the Lord God.
<< <i>MGICKER
Judging by your consistently bearish posted sentiment.
My sense is you have been out of the stock market a longtime I'm thinking.
If so why don't you tell us what you have learned and missed in your analysis and perhaps done differently to have
made some money in stocks ?? >>
Very good questions! I have been a market bear for many years, I put most of my life savings into coin inventory for my business 12 years ago. Most of the longer term holding coins have done quite well.
This is what I have learned about the markets in 40 years. First off, current pricing of a group of equities and their true value are two very different things.
Amazon is a great example. Visionary founder, cutting edge (or close) technology and plenty of sales volume. Problem is though, they are essentially an electronic Wal-Mart, selling low tech stuff like caramel corn and cupcake stands. Margins will never, ever be more than a dribble in their business, yet the market expected wonderful things. My short position did quite well (closed now) and I am currently looking for other over exuberant plays.
If one could assure me that all is well in the debt markets and the slowly growing economy were to naturally hold interest rates down, I might be convinced that a PE of 20 on the market was reasonable. Three problems, first, the debt market will go pop as it did in 2008. This time though, market manipulation (QE repeats) will fail as the sinking currency (not against other manipulated currencies, but commodities) will spiral down.
Number 2, PE's are grossly distorted by two items. First off, one time charges, which when accounting held some repute and sway were used very sparingly, are now used routinely and nearly quarterly by some concerns. My estimate is a 20-25% bogus increase in earnings reportage as quarterlies are always reported as ex items. Next is the overseas earnings that are tax sheltered. Apx 50% of the Blue Chippers earnings are locked in Europe and other friendly confines to avoid US taxation. Fair enough I suppose, but the earnings are not of the same quality as the domestic taxed dollars and repatriation is quite expensive. 30% or so in the case of Ebay recently.
My best estimate of the SP500 Price/earnings ration is really closer to 30 than the 20 or just below which is offered up by the talking head.
The one number that Wall Street cannot cheat on is the dividend yield. In the 1.9% range today for the SP500. Historically very dangerous. The only other time that it has been this low was right before the dot com burst of 2000. That of course was a bloody mess.
Impossible to predict whether the Dow reaches 20,000 or 10,000 next. Plenty of liquidity to drive the numbers up, but with margin debt at record highs, watch out. Valuations are just not there. Once margin buyers unwind positions, the action can be fast and painful.
dividend yield
you out of stocks for many years.
But in watching stocks go up now for 5 years have you learned anything differently in this bull run since 2009
that might make you think differently about stock investing?
That's what I was really asking.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
<< <i>Well you given plenty of reasons why your bearish thinking has kept
you out of stocks for many years.
But in watching stocks go up now for 5 years have you learned anything differently in this bull run since 2009
that might make you think differently about stock investing?
That's what I was really asking. >>
No. We have seen this boom and bust cycle 3 times since 1987, inclusive. This will be the forth and I believe of the Japan Nikkei 1989 type which will take over a generation to recover from. Sure some technical traders have made a bunch of money. I don't do that, stock valuation is pretty easy to evaluate compared to other asset classes. Overpaying may work for a while but always end poorly.
Right now everyone want to believe that inflation is under 2%. As long as they keep enough suckers in that camp, all is well. When the market realizes that the emperor is naked, 10 years bonds will readjust to 5% plus and bring PE rations down by a third.
For those that don't do links, the brief version is:
* look for a top in the transports first, IYT is a good proxy
* look for an inverted yield curve, when short term rates exceed long term rates
* look for extreme bullish sentiment at places such as the Association of Individual Investors
http://www.aaii.com/sentimentsurvey
link1
* other anecdotal evidence such as a bull on magazine covers, or the proverbial story of the shoe-shine boy giving Joseph Kennedy stock tips. Some people personally know "wrong-way" friends or relatives that have an uncanny knack for buying market tops.
None of these four is giving a sell signal at the moment.
http://tradesbytiger.blogspot.com/2014/05/tea-leaves-for-market-top.html
link2
As always, any and all indicators can fail. An out of the blue news event such as a major meteor strike can precipitate a bear market without any preconditions.
Thanks.
/edit to add: as always, I have nothing to sell. I am just another small fish trader in the big ocean. My blog is a trading journal that I am currently updating weekly. As I say on my page, real trades, no advice.
Problem was, the Dow Indu was at about 4200 at the time and soared to well over 10k before it popped 6 years after that encounter.
Traditional measures of over exuberance may not be the proper gauge today as many individuals have shunned the market after the 2008/09 debacle.
What I do see now though is a complacence that with the wizardry of the fed, the economy will never really slump again and lation will always remain manageable. Both of those assumptions are false.
<< <i>Thank you for the summary. I recall in late 1994 stopping at a grocer on an early morning trip. Two guys were discussing their mutual funds as they put cabbages on a display. A market top indicator? Maybe.
Problem was, the Dow Indu was at about 4200 at the time and soared to well over 10k before it popped 6 years after that encounter.
Traditional measures of over exuberance may not be the proper gauge today as many individuals have shunned the market after the 2008/09 debacle.
What I do see now though is a complacence that with the wizardry of the fed, the economy will never really slump again and lation will always remain manageable. Both of those assumptions are false. >>
You've been wrong for years. Dead wrong. You missed the entire bull market in stocks. Why should I or anyone else listen to a coin dealer that knows only a little about stocks, that has been so extremely wrong for so many years? Your writing style is entertaining, but it is costing anyone that takes it seriously, money.
Then you have the nerve to nitpick me over one of your anecdotes from 1994 over one of my indicators? Sheesh. Talk about a big ego, and someone that can't learn a lesson. Dude, you might start by eating some crow over your terrible market calls. Start by saying the words "I was wrong." The day after your post calling a major market top, stock market had a monster up day, with record highs for the Dow and SPY. All I hear is more wah-wah-wah (Charlie Brown teacher sound) about manipulated markets, the Fed, etc. Maybe try eating some humble pie and perhaps an old dog can still try and learn from others. Perhaps it is too late for you, perhaps you are too old, too thick headed to be open to learning from anyone else.
Perhaps you know everything. From the way you write, it seems like you have basically learned nothing and for the most part are citing tangential indicators to show that you were right all these years, even in the face of a once-in-a-generation bull market in stocks.
In any case, without hearing the 1994 conversation it may have meant nothing. If it were typical hemming and hawing over what fund to pick how much to invest, it would mean nothing. If it were two young people bragging over their big gains, and how they were going to retire in a few years from their investments, that would be another thing. I don't hear much of that talk these days, even with the record highs.
The S&P 500 is up about 22% since the last high point around Oct'2007. About 4% annualized. Not bad, I suppose - if you started from scratch. But stockholders took a major bath first, just to get there. How many bailed out in panic on the way down and then never recovered? Who needs that kind of treatment?
Frankly, nobody can afford to have the stock market go down - especially gov.com. If they can't tax gains upon withdrawal or liquidation, the whole scheme goes up in smoke. So the only recourse has been to inflate, since economic activity can't seem to get much traction. How many $trillions of stimulus & QE has been redistributed to the bankers and corporate cronies thus far? I've stopped keeping track.
Call it what you like. I think it's a house of cards.
I knew it would happen.
.2% expected, .6% reported
Core rate .2% expected. .5% reported.
Only one months figures, but 6-7% annualized inflation may force the fed to wake up.
Liberty: Parent of Science & Industry
<< <i>Confirmation bias >>
Good point, Baley. The incubator of all bubbles.
* look for a top in the transports first
I am not a buyer of transports.
Knowledge is the enemy of fear
I have to agree that it would be a hard act to follow.
I knew it would happen.
If you chose to-
Can you make a brief statement why this is a market for a passive investor to trust? Personally I see this market as risky business right now.
<< <i>I am not a buyer of transports.
I have to agree that it would be a hard act to follow. >>
Lets put what I see into perspective though. Maybe the transports come back down to test the 5000 breakout and drops 30%. Is that any different than gold dropping 30% from 1900? Same investment return, different asset classes. In the end, does/should the investor care?
Knowledge is the enemy of fear
<< <i>BIDASK,
If you chose to-
Can you make a brief statement why this is a market for a passive investor to trust? Personally I see this market as risky business right now. >>
Most investors should already have a well thought out asset allocation.
They should simply rebalance if , their stocks for example, have grown to be to large a part of their overall allocation and exceeds their tolerance level for having that much exposure........they should simply rebalance into another asset class such as cash.
If your talkiing about someone who has no allocation to stocks then yes I would definitely get invested even at this level of the dow to the extent
a person can risk and tolerate fluctuation.
I dont like makeing market calls.......
Much better to have a well thought out asset allocation where one rebalances when part of that asset allocation has gotten to big (or small) because of market appreciation ( or depreciation).
This disciplined process of rebalancing around one's risk tolerance in various asset classes works well over time very well.
The idea being we control what we can control, that is, how much skin we put in the game rather than making market calls which fools the majority most of the time.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
a person can risk and tolerate fluctuation.
Dan, I tolerate risk pretty well these days, and I heartily disagree.
I knew it would happen.
First off, the entire bull market in stocks runs from about 1981 to date. I have done quite well in the front end and medium term of the bull, and have profited handsomely on the crashes.
Your truculence towards someone with a varying opinion to yours is a sign of dogmatic thinking which in itself indicates
a bubble market. Sort of the logic that as long as no one defects from the fragile bull, it will remain intact and we can all prosper. (look up Blinder-Robinson from the 1980's)
Today was a rather profitable day btw. The declining interest rates threw up a warning flag before the bell and I was able to take advantage of the small slide.
Second coin purchase was 3 Peace dollars on Ebay which with a quick flip and a small profit, launched my new business.
Unfortunately, many retired folks have lost 6 years of bank deposit returns as the fed plays chicken with their life savings. A number of oolder people are taking risks that they would normally be uncomfortable with, as they are just trying to find some sort of positive income.
I have seen a lot in that span of time day in and day out. That includes learning that those who consistently try to make market calls are wrong and their returns show it.
Look, everyones tolerance for risk is different.
I have learned the best way to invest is to quantify your tolerance for risk in various asset classes and build a diversiified portfolio based on that.
After that rebalance, rebalance and rebalance to stay consistent with the original allocation that mirrors your tolerance level in the various classes. ( unless there is some life changing event) in which case you rethink how you have allocated your portfolio.
This approach takes discipline.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
<< <i>I have learned the best way to invest is to quantify your tolerance for risk in various asset classes and build a diversied portfolio based on that. >>
So what percentage of retirees portfolios are now recommended to be in equities?
It used to be a small percentage, what are the investment houses suggesting now to the old timers?
In other news...
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<< <i>
<< <i>I have learned the best way to invest is to quantify your tolerance for risk in various asset classes and build a diversied portfolio based on that. >>
So what percentage of retirees portfolios are now recommended to be in equities?
It used to be a small percentage, what are the investment houses suggesting now to the old timers? >>
its not bases on what investment
houses say!
Reread my post.
Portfolios are based on the individual circumstances of the retiree!
Not some Wall Street investment house model.
And yes I work for Morgan Stanley !
I give away money. I collect money.
I don’t love money . I do love the Lord God.
<< <i>Portfolios are based on the individual circumstances of the retiree! >>
I understand that. When I interviewed with Merrill Lynch in the mid 80's, they had suggested portfolio allocations based on years to retirement.
Life was simpler then and it was only a suggestion, of course the recommendations were based on many factors.
The idea was to wind down what was perceived to be the riskier instruments (common stocks) as the investor got older. Seems that about 15-20% equities was considered the reasonable max for the oldest clients.
With money markets and debt instruments offering historic low returns, just wondering if the allocations have skewered to the more aggressive vehicles.
<< <i>
<< <i>Portfolios are based on the individual circumstances of the retiree! >>
I understand that. When I interviewed with Merrill Lynch in the mid 80's, they had suggested portfolio allocations based on years to retirement.
Life was simpler then and it was only a suggestion, of course the recommendations were based on many factors.
The idea was to wind down what was perceived to be the riskier instruments (common stocks) as the investor got older. Seems that about 15-20% equities was considered the reasonable max for the oldest clients.
With money markets and debt instruments offering historic low returns, just wondering if the allocations have skewered to the more aggressive vehicles. >>
winding down risk as one approaches retirement is still
a watchword .......and even if a client wanted to chase a higher risk/higher return
investments because of low yields it would not be under my watch.
What is just as important is to discuss the other side of the balance sheer...ie spending .
There is nothing more frustrating than to have a good diversified asset allocation but
a client cannot control their spending .
I give away money. I collect money.
I don’t love money . I do love the Lord God.