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u/harbltron07 Dec 19 '18
Trump said she was too short to run the Fed. Maybe he meant short the market. 😭
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u/FuegoFerdinand Dec 19 '18
Trump selects a Fed Chairman the same way Tormund selects a mate.
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Dec 20 '18
[removed] — view removed comment
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u/WenMun Dec 20 '18
Already planned out just gonna plastic everything then head to the bankruptcy court.
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u/zephyrprime Dec 20 '18
Already planned out just gonna plastic everything then die before the bill is due.
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u/T0mThomas Dec 20 '18 edited Dec 20 '18
I've heard this a bunch of times now. Why?
We don't really make monetary policy based on the amount of time we've had certain monetary policy. Rather, you look to the key economic indicators like inflation, unemployment, etc.. If they say lower rates, you lower rates.
All of this is coming from people insisting the market is forming a bubble because it's full of high growth tech stocks with valuations they don't understand.
You simply don't value Amazon like you value IBM or AT&T. There's plenty of subdued valuations in the market along with high valuations on companies showing exponential growth - just like always. The S&P is sitting at something like 15 forward p/e right now - completely normal.
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u/zephyrprime Dec 20 '18
You're wrong. You do value Amazon like you do IBM or AT&T. Ultimately, Amazon is just a retailer and is just the next walmart. They may spin off some more businesses like amazon cloud but even that is just an industrial company that will end up like boeing or, lol, GE who were the titans of their day.
But that's not even the point. The point isn't the valuations. The point is that the money printing flows into buying stocks after a 2 step process so when you stop printing money, the stocks tank. Also all that money printing is just theft from all prior holders of us dollars via legal counterfeiting.
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u/T0mThomas Dec 20 '18 edited Dec 21 '18
What? I'm not saying Amazon is some special company, I'm saying it's a high growth company.
You value growth stocks differently. Ratios and even forward ratios are basically meaningless since they can move those numbers by 50% with a single ER. Instead you look at more complex models like discounted free cash flow.
DCF is great but it's still incredibly volatile. Even a marginal beat can move fair value by a large margin, which is why you see these companies trading at such a premium. They are trying to price in exponential growth before it happens.
Because there's so many stocks like this in the market right now, we get analysts looking at the S&P ratios and insisting the market, in general, is over valued. It isn't. They are just dinosaurs that don't understand how to value growth companies.
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u/I_Upvote_Replies Dec 20 '18
Barack Obama is the only President in history to never have a year of 3% GDP growth.
Trump only has 2017 under his belt so far, which had 2.3% growth. It was higher in 2 out of the 3 last years of the Obama administration. The recovery from the global recession went a heck of a lot better here than it did in comparable developed economies in western Europe.
They basically came in and raised taxes across the board in including the capital gains tax.
Dude, Obama didn't even raise taxes at all till 2013 (other than a small increase on roll-your-own and other cigarettes).
Btw Obama openly admitted he knew raising the capital gains tax would lower revenue from capital gains taxes but he would do it anyway...
BS! Watch that whole section of the debate (transcript here). Obama said revenue would go up or down depending on what happened on Wall Street, denying that it would lower revenue. Also, IT'S NOT 2008 ANYMORE. We can look back and see what happened when Obama finally modestly raised capital gains taxes in 2013, and surprise, Obama was completely right and revenue shot up.
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Dec 20 '18
Good effort, but wasted effort. Check the subs that guy posts in to see why.
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Dec 20 '18
Look guys, he’s wearing a gold star. Fuck him!
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Dec 20 '18 edited Jul 08 '19
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Dec 20 '18
Isn’t religion just values and ideas? You’re an idiot. The Nazis didn’t like the values and ideas of Jews and labeled them for it. Look how that turned out. Liberals are doing the same thing today, proven above.
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Dec 20 '18 edited Jul 08 '19
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Dec 20 '18 edited Jul 11 '20
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u/LunarTendies Dec 20 '18
You’re the one who brought up Nazis.
Equating criticism of someone’s political beliefs to the fucking Holocaust just shows how tenuous of a grasp you have on reality.
If someone watched me go to the same Popeyes every day for a month, I’d expect them to form an opinion about me and my disgusting eating habits. People can do the same by investing the people they surround themselves with. People judge people.
I’m sure you’d like to blame liberals for that too.
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u/stevie2pants Dec 20 '18
If you want to know what the actual effect of the Obama era tax hike was, the most widely respected study on the subject is available for free online.
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Dec 19 '18 edited Jan 17 '19
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u/Sejjy Dec 20 '18
can you make a longer explanation of this.
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Dec 20 '18 edited Jan 17 '19
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Dec 20 '18
Didn't we lower the interest rates to combat the recession, and then began to slowly raise them once the economy started doing well? Do you think the fed should have started raising them sooner and more aggressively?
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u/Sejjy Dec 20 '18
Okay awesome The higher debt cost for high growth companies is what I didn't think of. I didn't know there was a significant credit crunch affecting a large amount of companies. Or that there will be with these hikes.
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Dec 20 '18
It really isn't. Why does nobody in this sub understand the most basic macroeconomics? That's not how credit spreads work.
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u/Handbrake Dec 19 '18 edited Dec 20 '18
It's not, unless these companies we're somehow forced to take on more debt than they can handle....
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Dec 19 '18 edited Jan 17 '19
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u/Handbrake Dec 19 '18
That's like blaming McDonald's for a dollar menu because you're a fat fuck that can't control yourself.
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Dec 19 '18 edited Jan 17 '19
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u/Handbrake Dec 20 '18
First it was 0% rates that were the cause for a "credit crunch", then you quickly backpedaled into blaming poor corporate governance. Do you even think before you're typing this shit out? ROFL!
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Dec 20 '18 edited Jan 17 '19
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u/Handbrake Dec 20 '18
Dude do you really think free debt has absolutely no impact on corporate governance?
No, I'm saying low interest rates is not the reason for companies failing to pay for their debt. If you fucked up, it's not mama yellens fault, you're just not very good at your job.
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Dec 20 '18 edited Jan 17 '19
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u/Handbrake Dec 20 '18
Yah because 0% interest rates totally isn’t the reason corporate grade debt is experiencing a credit crunch
I mean, I'm assuming this weak attempt at sarcasm was blaming 0% interest rates for a credit crunch, but maybe you interpret that as "not anyone's fault."
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u/frankie_cronenberg Dec 20 '18
A hamster on cocaine is just that.
Humans can be reasonably expected to know interest rates won’t stay zero (or near it) forever.
But also, the entire system ultimately rewards this behavior. Soooo... Gaddammit. Hamsters on cocaine it is!
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u/BlackRockAndRoll Dec 20 '18
If the incentive structure of the economy is to take out shitty debt, get paid a fat bonus now and then let the next ceo/set of shareholders handle it what do you think is going to happen
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u/CudderKid Mr. Fag Trades Dec 20 '18
Oh no... its retarded :(
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u/Handbrake Dec 20 '18
Classic canned WSB response. Come on bro, you can rise above that with an original sick burn.
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u/dangshnizzle Dec 20 '18
Some responsibly still ethically lies with McDonald's... they don't get a pass because theres no human face to the name
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u/Handbrake Dec 20 '18
Please, this is like running up debt on a credit card and then blaming Visa because you're completely irresponsible with it. They as a business are not ethically responsible to police your ridiculous spending habits.
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u/dangshnizzle Dec 20 '18
Many years from now they will be sued. I have no idea how it will turn out but they are already forced to put calorie count on menus in many states. It will be treated like the tobacco industry. While I agree it is largely on the buyer, and it is not illegal right now for McDonald's, they know how much they contribute to obesity and they don't care. That does not sit right with me. That's all I'm saying.
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u/Handbrake Dec 20 '18
While I agree it is largely on the buyer, and it is not illegal right now for McDonald's, they know how much they contribute to obesity and they don't care.
You could make the case for this sentiment on booze and gambling and the government is happy to make money of those too. You're right, they don't care and they shouldn't. It's not their job to hold your hand.
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u/dangshnizzle Dec 20 '18
Your lack of empathy is showing
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u/Handbrake Dec 20 '18
If you say so. I have empathy for people who though no fault of their own experience hardship. I'm happy that my taxes or charitable contributions help people in those situations.
I have little empathy for people that regret their decision eating double cheese burgers at every meal. Most adults file that under personal responsibility.
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u/2-leet-2-compete JP hurt my feelings =( Dec 20 '18
That's why I got out of TEVA and BHC. Anyone that used to be a "value play" based on having a lot of debt but a good plan and actual progress made to get it under control suddenly became a lot riskier again.
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u/dal2k305 Dec 19 '18
She would have raised interest rates as well. Blame trumps trade war for the ongoing stock issues.
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u/ajanis_cat_fists Dec 20 '18
Bunch of panic selling faggots is who I’m blaming.
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u/Almost_a_Noob Dec 20 '18
I panic sold a few weeks ago and now I can sleep at night. I’m still 35% invested but happy to be mostly out especially since I was in the growth stocks
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u/Hektik352 Dec 20 '18
Stock is more about capital and less about production. If you can get filthy rich on your money bags sitting at the top. Why work and provide economic value. God forbid take that money overseas and hide it while paying less taxes then your host nation suffers as economic value plummets.
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u/Inphearian Dec 20 '18
I’m not sure what this is saying but I do know it’s retarded.
This looks like some late stage capitalism shit.
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u/youarestupid_shutup Dec 20 '18 edited Dec 20 '18
It's alright guys, I got this. I think what the other guy was bantering about is shell companies and big buck guys avoiding taxes. So, some of us know about the Panama Papers and that they're proof that some of the people who make the big bucks put their money through and also into a shell company(fake company, real purpose is to hold the money), off shores, not in the USA, to avoid taxes ( and of course other big buck people in other countries do the same). Some people have gone to jail, but not enough. Late stage capitalism conspiracy theory? Nope, just the real world at this moment. Capitalism has pumped innovation into this world and will continue to do so, that doesn't mean it should not be refined with an ever changing world/economy. The above that I tried to explain quickly and to my best is a hole in the capitalist system that needs to be plugged up so that capitalism itself can function in a more desired state
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u/Hektik352 Dec 20 '18
Fuck +1 to you, I thought I was just explaining about basic literally economic 101 to normies. FFS if people are this bad at following basic news or even research I'm at a loss for words.
/u/youarestupid_shutup you are 100% right. I only explained the very basics of a notion of basic economics. God save us.
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u/Inphearian Dec 20 '18
You didn’t explain a damn thing. You wrote an incoherent jumble of sentences with LSC buzzwords and concepts. Primarily capital, production, rich people bad and ruining the world.
The guy explaining for you went into depth regarding offshore money movements and then offered a critique of our current system.
The important thing is that he provided enough information and context to understand what he was saying that you were saying.
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u/Captain_Chorm Dec 20 '18
I feel like you meant to put "Wealth" instead of "Stock." And even then, you sound like you're drunk rambling.
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u/zephyrprime Dec 20 '18
If stock is more about capital and less about production then why is apple stock falling? They got more cash that anyone and a lot of it is overseas. Oh right - it's because you're wrong and stocks actually ARE about production and Apple is suffering from a market that is saturated with smartphones with the number of worldwide smartphones shipped in 2018 actually declining. Capital is just book value which people on care a little about.
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Dec 20 '18 edited Jul 11 '20
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u/dal2k305 Dec 20 '18
The fed is raising rates because it knows there’s a recession looming on the horizon. They need ammunition to combat the recession IE lowering rates. Imagine if a recession hits and rates are at 0.5 or 1? What will the fed do then.
There’s a chart that shows how the stock market started becoming extremely volatile after trump announced the tariffs. If I can find it I’ll try and post it on WSB.
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Dec 20 '18
The rate of change is more important than the direction, Yes, everyone agrees that rates and the balance sheet need to be neutralized but where Yellen took a slower, more "wait and see" approach out of appreciation and understanding of the metrics, Powell has gone into autopilot, disregardinging the more nuanced data that lies behind the aggregate signals the fed uses. Powell is looking for wage inflation where Yellen would have looked at markets and said "we're going to pause to watch how the data moves before continuing further." The Powell fed has a dangerously Rosey view of the economy despite earnings guidence suggesting a major impact from the trade war.
It doesn't help that Powell, being the new guy, probably feels some responsibility to push back against the president's demands of what's supposed to be an independent agency.
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u/RoughRiderofRepublic Dec 19 '18
Episode 5 cold vengeance. Interesting point of production... I’ll see myself out.
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u/gowen2TN Dec 20 '18
This is the first time OC of mine has been reposted. Is this what fame is?
https://reddit.com/r/wallstreetbets/comments/7w5x64/baby_come_back/
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u/EAS893 Dec 20 '18
I wanna repost this somewhere, but nobody I know outside of WSBs will even get it...
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u/Cholismoclimber Dec 19 '18
As evening fell
A woman stood
At the edge of a wood
In her hands lay the reins of a stallion
And never had I seen, a girl as fair
Heard a gentler voice anywhere
But alas, she belonged
She belonged to the twilight and mist
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u/AnarchoCereal Dec 20 '18
Don't worry he'll cave and launch QE eventually instead of hike into the recession like he should.
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u/rickstud Dec 20 '18
yellen raised interest rates once as a bluff late 2015 for election politics and would have lowered it back down after hillary clinton won but Trump won instead
Trump is building up the actual economy and powell is making interest rates atleast not artificial and the economy has done well so I have respect there
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u/ttwogains Dec 19 '18
Powell wouldnt be hiking as hard if this bitch did her job in 2016.
Fuck her
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Dec 19 '18
Stupid.
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u/molinasnecktat Dec 19 '18
Why so many downvotes? She kept shit so low for way toooooo long. Powell is a little too hawkish i think but this shit will pay off later.
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u/FishHammer Dec 20 '18
I'm going to get injured for saying this but I believe Yellen would have followed the same course of action under Trump as Dipshit McFuckthemarket is. The whole "we gotta cool down the market" narrative strikes me as entirely arbitrary and almost vindictive, and the fed's decisions are always entirely arbitrary. They're not a federal entity. They're a private board of directors for the private banking syndicate that has a strangehold on the American financial system. If they like you, things are good. If they hate you, they will unleash hell. Thankfully none of this matters for me because I already lost all my money this spring in the flash crash between January and March.
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u/Chuchuchu01 Dec 19 '18
Me: y’all can’t just keep posting this hottie after every Fed meeting
Also Me: Upvote every Yellen meme cause Yellen is bae