Financial Markets Meltdown

[MountainTi]

Originally Posted by Bigfeet

Sorry if this has already been discussed - I didn't spot it in a quick perusal of the thread (or maybe didn't understand it )- but what would be a good investment to look at? I agree that 7% inflation from government data seems low for real cost of living expenses. 5% bond yields, if you could find them, still falls behind this number. But, what is the better choice?

Varget. Buy for $70/lb at cabelas, sell for $140/lb on here

[Dean2]

Originally Posted by Bigfeet

Sorry if this has already been discussed - I didn't spot it in a quick perusal of the thread (or maybe didn't understand it )- but what would be a good investment to look at? I agree that 7% inflation from government data seems low for real cost of living expenses. 5% bond yields, if you could find them, still falls behind this number. But, what is the better choice?

Re read this thread in detail. There is a ton of quality information in it from a number of well informed folks that will answer your question or at least put u on the right path.

[EagleEyes]

Thanks for everyone who posts in here. Being a younger and novice investor its always nice to be able to hear others quality information on the market. I've tried following the advice here and its been working well for me. I've built a decent portfolio that seem to be doing well. Thanks everyone who posts I sure appreciate it.

[roper1]

I was a decent day in the markets away from another milestone, gonna have to wait awhile now I fear.

[CDN offroader]

Originally Posted by Bigfeet

If you hold bonds to maturity, is it still a poor investment choice at this time?

Here is a decent article from Andrew Hallam(author of Millionaire Teacher) on bonds. https://assetbuilder.com/knowledge-c...ocks-and-bonds

I personally am a ways from retirement, and invest in a mix of 100% equities etfs and dividend growth stocks/etfs, and index ETFs.

I am a buy and hold investor, I don't care if the market goes up or down, as I'm not selling any time soon. Market crashes = Black Friday sales, not something to be feared.

[Dean2]

Originally Posted by CDN offroader

Here is a decent article from Andrew Hallam(author of Millionaire Teacher) on bonds. https://assetbuilder.com/knowledge-c...ocks-and-bonds

I personally am a ways from retirement, and invest in a mix of 100% equities etfs and dividend growth stocks/etfs, and index ETFs.

I am a buy and hold investor, I don't care if the market goes up or down, as I'm not selling any time soon. Market crashes = Black Friday sales, not something to be feared.

It is a good article and contains a lot of conventional wisdom. The single biggest problem is he started in 2000 and ran forward from there. Interest rates have been in continuous decline over that 22 year period. Declining interest rates increases the value of bonds, which helps offset periods when stocks drop. However, buying or holding bonds now, when rates are at historic lows, and going into what we know for sure will be a rising interest rate environment is a whole different kettle of fish as I explained above. You buy bonds when interest rates are at the top of the range, not at the bottom.

Bank of Canada interest rate from just before 2000 to now. You can't get much lower than zero but it has already gone up .75 and there is talk of a full 1% increase at the next B of C meeting.

[KGB]

It’s not a good day on the markets today…

[fishtank]

Originally Posted by KGB

It’s not a good day on the markets today…

Can always average down …. I think for the next bit it will be bad news coming out of China( expect more supply chain issues). Inflation numbers and raising interest rate . sell off in may ? Can see a big jump on VIX..

[slough shark]

Originally Posted by Dean2

It is a good article and contains a lot of conventional wisdom. The single biggest problem is he started in 2000 and ran forward from there. Interest rates have been in continuous decline over that 22 year period. Declining interest rates increases the value of bonds, which helps offset periods when stocks drop. However, buying or holding bonds now, when rates are at historic lows, and going into what we know for sure will be a rising interest rate environment is a whole different kettle of fish as I explained above. You buy bonds when interest rates are at the top of the range, not at the bottom.

Bank of Canada interest rate from just before 2000 to now. You can't get much lower than zero but it has already gone up .75 and there is talk of a full 1% increase at the next B of C meeting.

I’m kind of curious what you think the chances are of inflation still running high while looking at what I’m thinking will be a big market hit as all of a sudden hedge funds have to pay interest in order to gamble? If so I’m kind of curious what will win out with the fed, trying to keep inflation down or prevent a larger market hit. This is the weirdest market/economy I’ve seen as nothing seems to be acting rationally, it’s also a lot more volatile than I’ve seen in some time and it seems things have the ability to move rapidly with a lot more significant variables in play.

We just sold our house because we need to move to get closer to my wife’s work and the kids school and I’m torn if I even bother to look at getting a different house right aways because of what very well could happen with prices and inflation. We got a 120 day rate lock and pre approval in place last week before the rate increase (and coming increases) in case we see something we want but it makes me a nervous buyer. Prices are always fast to go up but they go down slower it seems to me looking at the past. Not sure I want to wait a couple of years only to buy a house discounted 10-20% in price and sign up for a mortgage with what I’m guessing will be a 6% mortgage

[Dean2]

I never try to time markets in terms of buying and selling. That includes real estate. For going on 15 years at least, since the 2008 melt down in the States, CMHC, the Gov, and many analysts have been predicting the Canadian housing market will implode. So far they have been dead wrong. Will it flatten, maybe even drop, it likely will some time but I have absolutely no idea when.

What I can say for dead certain, inflation is going to run very high for at least the next 3 to 5 years. This is not a short term problem. What follows from that is the Bank of Canada will keep raising rates in an attempt to moderate inflation. Interest rates and the cost of goods are both going to be a whole bunch higher 3 years from now than they are today. If rates and prices get high enough you may actually see the foreclosure rates climb, but I think that is a ways off yet. Alberta has not had anywhere near the growth in house prices the eastern Canada has, and Vancouver. We are however trying hard to catch up as people move here to get away from housing so expensive they can't buy it.

Make what you will of that information.

[DiabeticKripple]

Originally Posted by Dean2

I never try to time markets in terms of buying and selling. That includes real estate. For going on 15 years at least, since the 2008 melt down in the States, CMHC, the Gov, and many analysts have been predicting the Canadian housing market will implode. So far they have been dead wrong. Will it flatten, maybe even drop, it likely will some time but I have absolutely no idea when.

What I can say for dead certain, inflation is going to run very high for at least the next 3 to 5 years. This is not a short term problem. What follows from that is the Bank of Canada will keep raising rates in an attempt to moderate inflation. Interest rates and the cost of goods are both going to be a whole bunch higher 3 years from now than they are today. If rates and prices get high enough you may actually see the foreclosure rates climb, but I think that is a ways off yet. Alberta has not had anywhere near the growth in house prices the eastern Canada has, and Vancouver. We are however trying hard to catch up as people move here to get away from housing so expensive they can't buy it.

Make what you will of that information.

Not to mention the federal government upping their immigration quota and flooding the housing market with potential buyers/renters while there is already a shortage of houses.

Doesn’t make sense to me to increase the amount of people looking for housing while not doing anything to build more houses.

[bdub]

This week was a broad based selloff of pretty much everything. We had a few periods this year where everything has sold off for a few days at a time. One in every month.

But really it has been a tale of two markets since November with tech and long duration getting sold off and commodities and commodity producers making big gains.

Central Banks are jacking up the rhetoric on oversize rate increases coming. Gonna be interesting to see how far they can go before slowing the economy down and causing another recession, especially with the amount of debt that has been added to the system. The USD$ has really been gaining strength for the last few months and should continue to strengthen as rates rise. That should cause big problems for other countries dependent on imports of energy and food as inflation starts to really bite. A growing energy/food crisis is staring us in the face. We are going to feel it here but it will be way worse in other countries. Gonna get ugly I think.

[Twisted Canuck]

Oh, it's already ugly, bdub. But it sure has room to get much, much worse.

[pikeman06]

Originally Posted by Twisted Canuck

Oh, it's already ugly, bdub. But it sure has room to get much, much worse.

It's already looking like a bad start to the week and the markets haven't even opened.

[Dean2]

Bad couple of days on the market. I had mentioned back in Feb that I had sold down my positions in the Royal and TD by a significant amount. Looks like I am going to get a chance to buy a bunch of bank shares back at very good prices. I will start legging cash back in when Royal hits 125 and TD hits 84. There are also going to be buying opportunities in a bunch of Pipeline and Utility companies etc. As hard as it is to watch the portfolio take a drop in value, these are the perfect times to use the cash that has accumulated to pick up bargains. I however would still not be going anywhere near Shopify, Twitter, Facebook etc. let alone the mid and small cap tech or airlines and cruise ships.

[elkhunter11]

Originally Posted by pikeman06

It's already looking like a bad start to the week and the markets haven't even opened.

China is dragging things down big time, I held on to some cash waiting for another covid dip and this might be it. Now it's a matter of when to buy

[fishtank]

Originally Posted by elkhunter11

China is dragging things down big time, I held on to some cash waiting for another covid dip and this might be it. Now it's a matter of when to buy

It’s going to be a long drag…. They are in some major issue with COVID lockdown Lots of angry and sick people in Shanghai . Debt and market taking a dump . Oil price are dropping expect slow down in the China demand .

[KGB]

Originally Posted by Dean2

Bad couple of days on the market. I had mentioned back in Feb that I had sold down my positions in the Royal and TD by a significant amount. Looks like I am going to get a chance to buy a bunch of bank shares back at very good prices. I will start legging cash back in when Royal hits 125 and TD hits 84. There are also going to be buying opportunities in a bunch of Pipeline and Utility companies etc. As hard as it is to watch the portfolio take a drop in value, these are the perfect times to use the cash that has accumulated to pick up bargains. I however would still not be going anywhere near Shopify, Twitter, Facebook etc. let alone the mid and small cap tech or airlines and cruise ships.

Do you think the banks will drop another 10%?

[Dean2]

Originally Posted by KGB

Do you think the banks will drop another 10%?

Well RBC is at 130 this morning, recent high was $147 when I sold in Feb, so off 11% so far , and my first buy order is in at $125, each subsequent buy is at $2 less per buy, so yes, I am expecting another 5-10%. That said, if it drops more than that I will just keep adding. To be clear however, I did buy some RBC at 130 and some TD at $92 Friday and Today. I also have a buy order on Enbridge at 52 and another at 50. There are more orders in but you get the idea. Like I said, I believe in legging in, not trying to time the very bottom.

[Dean2]

So today is a prime example of how hard it is to time markets. The fire sale on RBC shares at 130 didn't even last the whole day. Closed at $131.60. If I had not had a buy order in at the limit price good for 90 days I would likely have missed out unless I want to sit and watch the markets all day long. That is the whole advantage to limit orders, price dips, they fill automatically. Now, could the shares drop again tomorrow and fill the next buy at $125, could be, might also take weeks or never happen at all. What I know for sure is if you bought RBC at the annual high in pretty much the last 15 years, 12 months later you are way better off. If you bought at the year low, you are really doing well, so anything in between is good too.

[KGB]

Doesn’t look good today! All red…

[fishtank]

Originally Posted by KGB

Doesn’t look good today! All red…

Look to be red for the earnings , big oils reporting record profit on Friday will turn it around .

[elkslayer132]

Lost a bundle on Tesla today but it will come back. Might be a good time to get a bit more. I will be watching close

[bdub]

Monster tech is reporting starting today after hours. We get Google, Microsoft, Facebook, Amazon and Apple this week. Trillions of dollars in market cap under the microscope. Boeing reporting as well. Any of these could send the SP/Nasdaq for a ride depending on how the market sees it but it seems like the tech selloff is starting to pick up steam. The junkier tech names are already down 50, 60, 70% plus. The strongest in the sector are usually the last names to bite the dust and they have held up relatively well so far considering the slaughter in the rest if the sector.

[Dean2]

Originally Posted by bdub

Monster tech is reporting starting today after hours. We get Google, Microsoft, Facebook, Amazon and Apple this week. Trillions of dollars in market cap under the microscope. Boeing reporting as well. Any of these could send the SP/Nasdaq for a ride depending on how the market sees it but it seems like the tech selloff is starting to pick up steam. The junkier tech names are already down 50, 60, 70% plus. The strongest in the sector are usually the last names to bite the dust and they have held up relatively well so far considering the slaughter in the rest if the sector.

You are right about that. Shopify is trading at literal one quarter of it's very recent high. Goes once more to prove that you can have as much growth as you can possibly imagine but unless it produces a net profit it really has no value. Like the old saying, lose a nickel an orange but we wil make it up on volume. Same idiot arguement restaurants are making using Skip the Dishes and Uber Eats, who both earn MORE than the profit on each sale. Even the high growth tech that was making a positive return were selling at such a high multiple, and still are, that it makes no sense. If a company has no bottom line it really has no long term future. Good trading stock but not a long term hold. Never confuse the two.

[bdub]

Originally Posted by Dean2

You are right about that. Shopify is trading at literal one quarter of it's very recent high. Goes once more to prove that you can have as much growth as you can possibly imagine but unless it produces a net profit it really has no value. Like the old saying, lose a nickel an orange but we wil make it up on volume. Same idiot arguement restaurants are making using Skip the Dishes and Uber Eats, who both earn MORE than the profit on each sale. Even the high growth tech that was making a positive return were selling at such a high multiple, and still are, that it makes no sense. If a company has no bottom line it really has no long term future. Good trading stock but not a long term hold. Never confuse the two.

Lol. Yes exactly.

Here's some of the multiples. Not my data, someone else recently.
P/E of twitter 128x, tsla 120, amzn 44, msft 29, appl 26, sp500 21

P/S of the same 8, 16, 3, 11, 7, 2.7

[flyrodfisher]

Originally Posted by Dean2

You are right about that. Shopify is trading at literal one quarter of it's very recent high. Goes once more to prove that you can have as much growth as you can possibly imagine but unless it produces a net profit it really has no value. Like the old saying, lose a nickel an orange but we wil make it up on volume. Same idiot arguement restaurants are making using Skip the Dishes and Uber Eats, who both earn MORE than the profit on each sale. Even the high growth tech that was making a positive return were selling at such a high multiple, and still are, that it makes no sense. If a company has no bottom line it really has no long term future. Good trading stock but not a long term hold. Never confuse the two.

Precisely!

I classify the skip the dishes and uber eats type of companies as purely parasitic...and even as non users of these "delivery" companies we are paying for them at the till.

@Dean2....BTW you post some great financial advice.

[roper1]

Hey, Thanks a bunch to you guys lending your thoughts & expertise on a subject quite dear to a lot of us.

[bdub]

Here comes the wall of cash to shareholders. Cenovus increases dividend from 0.14$ to .42$. Profit up 7x.


https://www.cenovus.com/invest/finan...y-results.html
https://www.theglobeandmail.com/busi...rally-triples/

[Bigfeet]

Anyone have any experience with the TD Ameritrade thinkorswim platform? The paper trading option allows you to learn how the stock market works, do trades, etc. without spending any cash. Looks to be a good learning tool?