Trading the stockmarket (NO Referrals)

Surveyor said:
Good to hear.

Cash can be spread around banks and building societies with FSCS protection up to £85,000 (£170,000 for joint accounts).
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Still losing money in real terms though, with very low interest rates and high and rising inflation (8%+ I would say). So you are still losing by holding cash, the question is, where would you not lose?
 
radderfire said:
Still losing money in real terms though, with very low interest rates and high and rising inflation (8%+ I would say). So you are still losing by holding cash, the question is, where would you not lose?
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You're predicting a big general financial crash so it would seem there's nowhere you would not lose. With cash in the bank £1 will still be worth £1 even if you're losing out to inflation. If your prediction is correct £1 in stocks will be less worth less than £1 and also losing out to inflation.
 
Returns are around 1%. You'd be better off with a Chase account at 1.5. Unless you get lucky, which you probably won't.

My misses has a fair chunk in PB and its just getting inflated away.
 
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I've moved to more dividend focused stocks. SIPP is going into MNG for a while now, and my ISA I've YOLOed 100% into Intel. Firstly the dividend is nice, second the growth stocks will get hit harder and I still want semiconductors.

Not really arsed what happens to the stock price, wouldn't mind a crash right now as circumstances mean I have loads of disposable, so I'm scrimping and pouring everything into accumulating as much as possible during this downturn.
 
It's already at a low post COVID, another crash may well be incoming, stop buying myself now apart from the crazy world of crypto.
 
radderfire said:
My prediction - There will be quite a big general financial crash quite soon, probably mid August. It is quite hard to position yourself against this as most asset classes will be affected. Personally I would not be buying any stocks until I had seen this crash take place. Right now, there is a lot of macro risk, as in risk of a banking crisis, which could affect the stock market. The question is, where do you take cover, because leaving large amounts in cash could also be risky.
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I don't see the risk of a banking crisis myself.
 
200sols said:
I don't see the risk of a banking crisis myself.
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I don’t either. Financial buffers are high. BoE are saying that interest rates can go substantially higher before people have issues servicing debts. Savings are at the highest for a long time due to changes in peoples spending habits during covid. Banks, property etc. are going to be very safe in this next bear market. Heated markets like tech, crypto etc. have already fallen and have a bit more to go. This is going to be an inflation not credit driven recession.
 
200sols said:
No.

Should I ask you, do you working in the crypto sector? This isn't 2008 (imo of course)
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No, I don't.

One thing that is notable is that Jamie Dimon warned of stormy times ahead, and it's unusual for a major figure in banking to make a warning like that. Another indicator to keep an eye on is bond yields and yield curve inversion.

Inflation is gathering pace and I don't see it slowing down. The way I see it is central banks only have one tool to address this, and that is raising interest rates. The problem with this is there is a lot of debt and mortgages out there, and if interest rates are raised even by small amounts it all becomes unaffordable, and the economy goes into recession, and everything gets worse. Hence there is a big limit on what central banks can now do about inflation, so they are likely going to have to pause or even revert interest rate rises. At this point, there may be a relief rally in things that respond well to loosening monetary policy. Central banks will continue to raise interest rates and then pause and lower them, in a kind of yo yo, i.e. regular pivots. This will only be able to go on for so long and then it is crunch time.

When it comes to the stockmarket, then I think the play is looking for recession resilient companies with decent dividends, probably easier said than done.
 
radderfire said:
No, I don't.

One thing that is notable is that Jamie Dimon warned of stormy times ahead, and it's unusual for a major figure in banking to make a warning like that. Another indicator to keep an eye on is bond yields and yield curve inversion.

Inflation is gathering pace and I don't see it slowing down. The way I see it is central banks only have one tool to address this, and that is raising interest rates. The problem with this is there is a lot of debt and mortgages out there, and if interest rates are raised even by small amounts it all becomes unaffordable, and the economy goes into recession, and everything gets worse. Hence there is a big limit on what central banks can now do about inflation, so they are likely going to have to pause or even revert interest rate rises. At this point, there may be a relief rally in things that respond well to loosening monetary policy. Central banks will continue to raise interest rates and then pause and lower them, in a kind of yo yo, i.e. regular pivots. This will only be able to go on for so long and then it is crunch time.

When it comes to the stockmarket, then I think the play is looking for recession resilient companies with decent dividends, probably easier said than done.
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I would worry more about rapid rising of interest rates causing job losses. Pay will rise to respond to inflation and there’s quite a bit of savings in accounts from the lockdowns. Household debt is quite a bit lower than it was during the 2007-2009 recession which was a credit driven recession. The only people that will suffer credit related issues are lower earners in society and so it’s not going to bring the economy down as they do not have assets like houses etc.

We aren’t going into a severe recession like the 2007-9 one but I also wouldn’t play it down as if they over do it with interest rates or don’t get the inflation under control then things could get a bit messy. I would be cautiously confident of being able to sit out of the market for a bit to time the fall and then buy back in for another bull run. We need to let that bear run its course.
 
CRB index and WTI index are all crashing. The back of inflation has been cracked. Its an earnings recession for me, people at the bottom won't really see it, its the corp profits and shareholders (wealthier people & 401k's) that'll get the brunt of it. FED seems ok with job losses as well to get inflation back under 2%/3%, that'll effect people at the bottom though

Do i think we're in a different financial era? Yea, possibly, very hard to have high conviction on either side, does the world go back to deflationary (lower rates, easy money) keeping the the current system going. Huge tailwinds with that, demographics, automation, AI, debt

Or do we get financial repression (inflating the debt away) It's very unpalatable for the general public that ie 5% inflation, 2% 10y interest rate = -3% return

Negative interest rates with CBDC's though, they are getting a huge amount of noise at the moment..that's 1% inflation, -2% 10y interest rate = -3% return. Same outcome, different lens. Far more palatable. Debt is a drag on growth, if we're moving to this ESG world where supply chains are brought closer to home, i suppose that would be the inflationary tailwinds.
 
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Banks arent badly placed this time, well funded & able to continue in profits Lloyds is too cheap but any view can be wrong I guess. CRB shows up 34% YTD or 50% from a year ago, I think it will rise over a decade. Its reasonable to think CRB continues to fall, if we had strong currency but I think any losses are via inflation not deflation; the bank of Japan is broken for example but not the country itself and I dont know how that turns out but dont reckon YEN is going up ditto every other QE currency.
CRB up is good for FTSE, unlike Dollar we have had weak currency which means the FTSE looks quite fine against SPY or DOW

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I think its best to stay in the market, if SPY regains prices it had start June then we might sell from there. Thats presuming we break the trend of falls, according to this guy

CRB Commodity Index - Price - Chart - Historical Data - News

CRB Index increased 39.19 points or 13.00% since the beginning of 2024, according to trading on a contract for difference (CFD) that tracks the benchmark market for this commodity. CRB Commodity Index - values, historical data, forecasts and news - updated on October of 2024.
tradingeconomics.com tradingeconomics.com

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edition.cnn.com

Analysis: Russia broke the stock market. Now there's only one reliable way to make money

Investors searching for safe havens during the worst inflation in more than 40 years are out of luck.
edition.cnn.com edition.cnn.com
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We live in interesting messed up times.
 
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