Will the stock market crash (June 24 2016 Update)?

[warriorchick]

Life is easy when you don't have any major investments.

Mo' money, mo' problems, amirite?

Reminds me of when glow and I got married on October 17, 1987. We had just spent the bulk of our modest savings on our modest wedding.  Two days later, Black Monday happened.

I was never so glad to be broke.

[GooooMarquette]

If we're talking about the end of globalization, P&G, MMM and especially GE are going to suffer badly. Prior to 2008 the long-term return in the stock market was 9%.  Since 2008 it's been more like 5%.   Post BRexit it and what's coming with the end of globalization makes me think it's can be closer to zero.

It's easy to cherry-pick time periods to make them look good or bad.  For the returns prior to 2008, how about starting with the dot-com bubble?  Or for more recent returns, how about looking at overall returns since 2009 instead of 2008?  How about looking at returns from the mid-60s to the early-80s?  That would make even a zero return seem spectacular.

Select the dates carefully enough, and you can paint any picture you want.

[Tugg Speedman]

For him, near-term means the next week or so.
If stocks do decline 10% in the next week, is that a crash?
(Note, stocks declined 10% in four days in late August when China devalued.  Stocks are at that same level now, buying that panic, and holding to today, produced no gains.)


JPM Head Quant: Expect Up To $300 Billion In Program Selling, "5-10% Near-Term Downside To The S&P500"
http://www.zerohedge.com/news/2016-06-26/jpm-head-quant-expect-300-billion-program-selling-5-10-near-term-downside-sp500

is week, we expected a Brexit outcome to have an asymmetric impact for equities, with downside exacerbated by unwind of long equity investor positioning. In particular, increasing equity volatility would induce systematic strategies (Volatility Targeting, Risk Parity, CTAs) to start deleveraging their high equity exposure, resulting in $100-300 billion of selling.

[MU82]

Mo' money, mo' problems, amirite?

Reminds me of when glow and I got married on October 17, 1987. We had just spent the bulk of our modest savings on our modest wedding.  Two days later, Black Monday happened.

I was never so glad to be broke.

My employer had just launched a 401k plan for us in April 1987. I eagerly plowed the max allowed into it every two weeks, investing in the S&P 500 fund option. When Black Monday struck 6 months later, I panicked, sold all of the fund and put everything in the money market option. I simultaneously directed future investments go into the money market fund.

So I locked in the losses from the crash and then got zero benefit when the market recovered.

That is why the "average investor" fails. Thankfully, the 30-something, 40-something and especially 50-something me is a little more knowledgeable about these things than the 20-something me was.

It's one of the oldest cliches, but so true ... I wish I knew then what I know now. (Or at least what I think I know now!)

[MomofMUltiples]

Mo' money, mo' problems, amirite?

Reminds me of when glow and I got married on October 17, 1987. We had just spent the bulk of our modest savings on our modest wedding.  Two days later, Black Monday happened.

I was never so glad to be broke.

Chick, about that same time my husband was accidentally sent a check from a retirement account that was supposed to be Wired directly the new account instead.  Took a few day to get it to the new account.  Never was I ever so happy to not have my money "working" for me.

I'm on my way home from a week in Berlin and it didn't strike me that the Germans were too exercised about the Brexit  (and I was spending a lot of time with officials in the Ministry of Economics and Energy).  These associations change all the time, and markets adapt. That's why you don't get too excited when you have 20% annual returns in your portfolio, or too nervous when you have -10%, both of which I have experienced (more than once) over the past four decades.  Slow and steady, and You can win the race, or at least not lose it.

[brandx]

The New York Times lead on Sunday (today) gets it right.  The institutions and structure put in place after WW2 are at real risk of collapsing.  A realignment of the world like nothing seen since 1945.

It took me a while to figure out your game, but I finally got it.

You are a calamity groupie.

[Tugg Speedman]

I'm on my way home from a week in Berlin and it didn't strike me that the Germans were too exercised about the Brexit  (and I was spending a lot of time with officials in the Ministry of Economics and Energy).  These associations change all the time, and markets adapt. That's why you don't get too excited when you have 20% annual returns in your portfolio, or too nervous when you have -10%, both of which I have experienced (more than once) over the past four decades.  Slow and steady, and You can win the race, or at least not lose it.

Did you meet with them Friday because before Friday they were all confident that brexit was never going to happen. This is quite shocking for them. Just read the German papers in about how German politicians are conflicting themselves with statements about what's next.

[Dr. Blackheart]

For him, near-term means the next week or so.
If stocks do decline 10% in the next week, is that a crash?
(Note, stocks declined 10% in four days in late August when China devalued.  Stocks are at that same level now, buying that panic, and holding to today, produced no gains.)


JPM Head Quant: Expect Up To $300 Billion In Program Selling, "5-10% Near-Term Downside To The S&P500"
http://www.zerohedge.com/news/2016-06-26/jpm-head-quant-expect-300-billion-program-selling-5-10-near-term-downside-sp500

is week, we expected a Brexit outcome to have an asymmetric impact for equities, with downside exacerbated by unwind of long equity investor positioning. In particular, increasing equity volatility would induce systematic strategies (Volatility Targeting, Risk Parity, CTAs) to start deleveraging their high equity exposure, resulting in $100-300 billion of selling.

The Black Swan doesn't seem to mind, ai-na?

[GooooMarquette]

It took me a while to figure out your game, but I finally got it.

You are a calamity groupie.

Yeah, he must've been lots of fun just before civilization as we knew it ended on Y2K.

[MomofMUltiples]

Did you meet with them Friday because before Friday they were all confident that brexit was never going to happen. This is quite shocking for them. Just read the German papers in about how German politicians are conflicting themselves with statements about what's next.

I spent the entire week with them, both before and after the vote.  They did believe Britain would vote to remain, but didn't think the Brexit vote was that significant for anyone but Britain.  What politicians say in papers is what politicians want the world to hear  What they say in private - like, Britain has always held itself an arm's length from the rest of the EU, is what I trust they think as individuals.  These where some very smart individuals high up in the German Ministry.

I'm only reporting my conversations; I certainly don't claim to know what all of Germany or Europe thinks.  In all financial matters, we must act as we see fit to protect our wealth.  Like chick and others, I pay a very good person to look after that for me, and generally take his advice.  So forgive me if I don't cash out in small bills tomorrow and stuff them in my mattress.

[GGGG]

It took me a while to figure out your game, but I finally got it.

You are a calamity groupie.

It took you this long?  Dude's probably got a basement full of canned good and gas masks.

[4everwarriors]

I spent the entire week with them, both before and after the vote.  They did believe Britain would vote to remain, but didn't think the Brexit vote was that significant for anyone but Britain.  What politicians say in papers is what politicians want the world to hear  What they say in private - like, Britain has always held itself an arm's length from the rest of the EU, is what I trust they think as individuals.  These where some very smart individuals high up in the German Ministry.

I'm only reporting my conversations; I certainly don't claim to know what all of Germany or Europe thinks.  In all financial matters, we must act as we see fit to protect our wealth.  Like chick and others, I pay a very good person to look after that for me, and generally take his advice.  So forgive me if I don't cash out in small bills tomorrow and stuff them in my mattress.

Duz yur dude drive ta work or take da bus, hey?

[MU82]

It took you this long?  Dude's probably got a basement full of canned good and gas masks.

I can only imagine what Heisy was thinking about the future of the world (not to mention the U.S. economy) after 9/11.

I'm guessing, "We may never, ever recover from this," was probably his main thought.

[Tugg Speedman]

I can only imagine what Heisy was thinking about the future of the world (not to mention the U.S. economy) after 9/11.

I'm guessing, "We may never, ever recover from this," was probably his main thought.

Nope ... got long

Remember, I'm a professional speculator.  I used to manage/trade OPM (other people's money) but now I speculate for myself and a handful of other professional investors.

So Am I a calamity Groupie ... yes.  My business works best when we are at the beginning of the end of civilization.  When things are going great I struggle.

That is why I'm so pissed at myself about my losses on Friday.  It was an unforced error.

So yes, I'm in and out all the time and now I'm pressing my shorts (more UK stocks than US stocks but both, and a smaller position in China A-shares.  Biggest position is the short in the Pound, looking to cover in the lows 1.20s.).  I will until everyone gets that warm wet feeling in their pants.  My guess is that is in the next two weeks.

How good am I at doing this?  Been doing it since 1986, thirty years, and continually turn down offers to so the same for large investment banks and hedge funds.

[4everwarriors]

Heisy Baby, did ya drive ta work or take da bus, hey?

[Mutaman]

Remember, I'm a professional speculator.

Really? I thought you were a professional cutter and paster of articles on a college basketball websight.

[GooooMarquette]

Remember, I'm a professional speculator.

How good am I at doing this?  Been doing it since 1986, thirty years, and continually turn down offers to so the same for large investment banks and hedge funds.

If you're as good as you say you are, you should have plenty of $$$$ put away - so why all the worry about the next financial disaster?

[GooooMarquette]

I'm beginning to seriously wonder if the Brexit is actually going to happen.

http://www.economist.com/blogs/bagehot/2016/06/anarchy-uk

Cameron had no plan, Boris Johnson (leading Brexit advocate) apparently has no plan, Parliament (including members who voted for Brexit) have no plan...so basically the entire UK is currently staring at each other with blank looks on their faces.  Meanwhile, Merkel and Hollande are asking the UK what kind of message they should send to other EU members...and nobody is answering the phone.  And the two-year exit process doesn't begin to run until after the UK formally requests withdrawal.

My guess - more and more people sign the petition for a re-vote, so it is granted...and "stay" wins by a landslide because UK citizens now realize their own government has no clue how to proceed without the EU propping it up.

[MU82]

Nope ... got long

Remember, I'm a professional speculator.  I used to manage/trade OPM (other people's money) but now I speculate for myself and a handful of other professional investors.

So Am I a calamity Groupie ... yes.  My business works best when we are at the beginning of the end of civilization.  When things are going great I struggle.

That is why I'm so pissed at myself about my losses on Friday.  It was an unforced error.

So yes, I'm in and out all the time and now I'm pressing my shorts (more UK stocks than US stocks but both, and a smaller position in China A-shares.  Biggest position is the short in the Pound, looking to cover in the lows 1.20s.).  I will until everyone gets that warm wet feeling in their pants.  My guess is that is in the next two weeks.

How good am I at doing this?  Been doing it since 1986, thirty years, and continually turn down offers to so the same for large investment banks and hedge funds.

You are my hero. (You would be even more my hero if you admit you were wrong -- as I called you out for moving the goalposts at 11:46:53 PM last night.)

Hard to believe you made an unforced error Friday. You sell yourself here in Scoop Land as knowing everything about everything. So disappointed to hear you are (almost) mortal.

[naginiF]

the majority of my assets are in land/my bldg, and the businesses(dental and an indoor self-storage facility)  that i own.  i'd say 1/3 in retirement plans, invested in the market, 2/3 businesses and bldg.  i realize the businesses and bldg are hooked at the hip with the overall economy, but i believe it may be a better set-up than the reversal.

I've been mildly curious about the self-storage industry for a while.  'mild curiosity' defined as every time I see a facility in a super rural area, or two in close proximity in a metro area, the following questions pop into my mind but 20 seconds later leave.

- what does the customer base look like?  Is it consumer or small/mid business?
- if consumer, is it mostly temporary usage (just got divorced living in a'ppt until i can find a house) or long term (i don't have room for Mom's estate but can't part with it)?
- other than on site advertising i've seen minimal advertising.  am i just not seeing it or is it a 'hey, when you need storage you know it' situation?
- it seems like there was a big spike in supply 15 (ish?) years ago and, unlike the self-serve yogurt shop explosion of 5 years ago, it looks like there is still a good amount of demand for that supply.  Was this really a newly found service or were there other versions of this service available before the latest manifestation?

I'm not looking for anything detailed (if so, tell me to pound), just an educated pedestrian' level of info.

*****not super sorry for going off topic in this thread******

[Tugg Speedman]

You are my hero. (You would be even more my hero if you admit you were wrong -- as I called you out for moving the goalposts at 11:46:53 PM last night.)

Hard to believe you made an unforced error Friday. You sell yourself here in Scoop Land as knowing everything about everything. So disappointed to hear you are (almost) mortal.

Often wrong but never in doubt.

[brandx]

Nope ... got long

Remember, I'm a professional speculator.  I used to manage/trade OPM (other people's money) but now I speculate for myself and a handful of other professional investors.

So Am I a calamity Groupie ... yes.  My business works best when we are at the beginning of the end of civilization.  When things are going great I struggle.

That is why I'm so pissed at myself about my losses on Friday.  It was an unforced error.

So yes, I'm in and out all the time and now I'm pressing my shorts (more UK stocks than US stocks but both, and a smaller position in China A-shares.  Biggest position is the short in the Pound, looking to cover in the lows 1.20s.).  I will until everyone gets that warm wet feeling in their pants.  My guess is that is in the next two weeks.

How good am I at doing this?  Been doing it since 1986, thirty years, and continually turn down offers to so the same for large investment banks and hedge funds.

Chicas and Heisy HAVE to be brothers. Unless one of them died in the womb.

[MU Fan in Connecticut]

Right, the UKIP (the party leading the charge to leave) only has 4 seats, out of the 1450 in the British parliament. It's not insane to think that the government is gonna pull an "oh sh!t, we really screwed up" moment and not actually enact it. It's not like it was a landslide vote, and people who voted to leave were pretty open by saying that they may have screwed up. They could also take into account the demographics of the vote, where young voters who will have to deal with the consequences were overwhelmingly in the remain camp.

The one thing Britain has going for them is that their liberal and conservative party isn't as divided as democrats and Republicans in the US, they could actually pull this one out.

Only 51.9% voted to leave hardly overwhelming.  There were several news articles on this on Friday that Britons were Googling "what it means to leave the EU" because most of then who voted leave had no idea what they were voting for.

[rocket surgeon]

I've been mildly curious about the self-storage industry for a while.  'mild curiosity' defined as every time I see a facility in a super rural area, or two in close proximity in a metro area, the following questions pop into my mind but 20 seconds later leave.

- what does the customer base look like?  Is it consumer or small/mid business?
- if consumer, is it mostly temporary usage (just got divorced living in a'ppt until i can find a house) or long term (i don't have room for Mom's estate but can't part with it)?
- other than on site advertising i've seen minimal advertising.  am i just not seeing it or is it a 'hey, when you need storage you know it' situation?
- it seems like there was a big spike in supply 15 (ish?) years ago and, unlike the self-serve yogurt shop explosion of 5 years ago, it looks like there is still a good amount of demand for that supply.  Was this really a newly found service or were there other versions of this service available before the latest manifestation?

I'm not looking for anything detailed (if so, tell me to pound), just an educated pedestrian' level of info.

*****not super sorry for going off topic in this thread******

no problems-this is a new endeavor for us.  i built a 12,000 sq. ft bldg. in 2003)  we use half for my dental ofc. and my brothers accounting business.  so that left about 6,000sq. ft vacant.  our intentions were to turn it into more office space.  well, over the years, we had quite a few hits, all misses and then the economy chit out in 2008-09...my builder suggested self storage a few years ago and i laughed.  well here we are.  i was driving around one day and saw this beautiful indoor, climate controled self storage facility-BANGO!  if you go to a self storage blog, it's a whole different world.  my facility is relatively small(35 units) by industry standards, but i just want to get some cash flow going.  btw, i am about a month away from opening.  anyway, there are waiting lists for these, especially the indoor climate controled ones.  i have another acre plus just outside and that may become phase II and have 60 or so more units. i have a 500 unit apartment complex across the street from me.  self-storage has become a must-have for apartment dwellers, college students in transition, movers in transition, art, guns, motorcycles, snowmobiles, we have our township needing climate controll to store/archive hard copy stuff goingback years.  if you need storage, you don't need advertizing other than a web site and word of mouth.  the facility will be practically self run except for those who want a tour.  everything else can be done online.  i can monitor the facitlity from my phone of i-pad.  everyone, and mean EVERYONE i talk to say they cannot build these fast enough.  if you visit inside self storage, you will be amazed of how omnipresent this is 

[Badgerhater]

no problems-this is a new endeavor for us.  i built a 12,000 sq. ft bldg. in 2003)  we use half for my dental ofc. and my brothers accounting business.  so that left about 6,000sq. ft vacant.  our intentions were to turn it into more office space.  well, over the years, we had quite a few hits, all misses and then the economy chit out in 2008-09...my builder suggested self storage a few years ago and i laughed.  well here we are.  i was driving around one day and saw this beautiful indoor, climate controled self storage facility-BANGO!  if you go to a self storage blog, it's a whole different world.  my facility is relatively small(35 units) by industry standards, but i just want to get some cash flow going.  btw, i am about a month away from opening.  anyway, there are waiting lists for these, especially the indoor climate controled ones.  i have another acre plus just outside and that may become phase II and have 60 or so more units. i have a 500 unit apartment complex across the street from me.  self-storage has become a must-have for apartment dwellers, college students in transition, movers in transition, art, guns, motorcycles, snowmobiles, we have our township needing climate controll to store/archive hard copy stuff goingback years.  if you need storage, you don't need advertizing other than a web site and word of mouth.  the facility will be practically self run except for those who want a tour.  everything else can be done online.  i can monitor the facitlity from my phone of i-pad.  everyone, and mean EVERYONE i talk to say they cannot build these fast enough.  if you visit inside self storage, you will be amazed of how omnipresent this is

In the rural area where I now live, the barns on non-working farmsteads have been converted to RV and boat storage.  Such places near subdivisions with outdoor storage rules do the best.  Nice stream of income without much hassle.

We have a whole segment of the economy dedicated to managing extra stuff.....storage, resale shops, craigslist, ebay, professional organizers.....plenty of opportunity at all levels there for those who want to put in the effort.