Investing Thread

[Hards Alumni]

No. He actually didn't. The United States economic recovery has been stronger than almost all of the worlds because we spent a bunch to make sure we didn't face an enormous economic catastrophe on top of a public health one.

Our GDP is just slightly below where it would have been projected to be, our inflation is in check especially compared to Europe, and our unemployment is microscopic.

https://home.treasury.gov/news/featured-stories/the-us-economic-recovery-in-international-context-2023

Ignore the "Biden Administration" stuff in here and just look at the figures. This started under Trump. Frankly he should take a lot more credit for this (and Operation Warp Speed) than he does, and not focus so damn much on personal vandettas.

YEP.

[MU Fan in Connecticut]

The hand wringing over the debt has been going on for forty or more years. At what point do we think that it isn't much of a problem?

Anyway inflation has been decreasing and interest rates have topped off for months now.

But some very smart business people here have predicted a recession (or worse) for some time. So I just want to know when that will be.

FWIW, I read a CNBC interview with an economist this week and he referred to it as a "rolling recession for lack of a better description" which is why the job numbers continue to be good.  He said it was hitting one sector at a time and as that sector improved and popped back up the next one will slow.  The housing market had been dead and showed an uptick in May followed by the best month in two years in June as buyers have to come to grips that the loan % increase is here to stay.  Travel and hospitality has seen non-stop a flood of spending.  I can say that manufacturing other than defense, aerospace, automotive is extremely slow right now.  Everyone I talk to says the same.  The powers that be decided we are furloughing operators in stages over the next 6 weeks because we don't want to lose them.  I've talked to other manufacturing plants that are on 3 day work weeks.  My customers are telling mew the same both domestic and internationally.  Everything is being pushed out into late 3Q early 4Q.  My customers order forecasts do show a sizeable increase in September and stable after that. 

[Coleman]

The hand wringing over the debt has been going on for forty or more years. At what point do we think that it isn't much of a problem?

Anyway inflation has been decreasing and interest rates have topped off for months now.

But some very smart business people here have predicted a recession (or worse) for some time. So I just want to know when that will be.

This is the only debt metric that matters: https://fred.stlouisfed.org/series/GFDEGDQ188S

It is still historically high, but decreasing. As long as we keep trending down, we are fine. Ideally we'd like to be below 100%

[Uncle Rico]

FWIW, I read a CNBC interview with an economist this week and he referred to it as a "rolling recession for lack of a better description" which is why the job numbers continue to be good.  He said it was hitting one sector at a time and as that sector improved and popped back up the next one will slow.  The housing market had been dead and showed an uptick in May followed by the best month in two years in June as buyers have to come to grips that the loan % increase is here to stay.  Travel and hospitality has seen non-stop a flood of spending.  I can say that manufacturing other than defense, aerospace, automotive is extremely slow right now.  Everyone I talk to says the same.  The powers that be decided we are furloughing operators in stages over the next 6 weeks because we don't want to lose them.  I've talked to other manufacturing plants that are on 3 day work weeks.  My customers are telling mew the same both domestic and internationally.  Everything is being pushed out into late 3Q early 4Q.  My customers order forecasts do show a sizeable increase in September and stable after that.

This sounds accurate based on what I've seen and dealt with

[Skatastrophy]

YoY CPI growth has seemingly halved. Seems like the folks on main street are feeling some relative relief.

[Hards Alumni]

This is the only debt metric that matters: https://fred.stlouisfed.org/series/GFDEGDQ188S

It is still historically high, but decreasing. As long as we keep trending down, we are fine. Ideally we'd like to be below 100%

Agreed.  People crow about the debt, but then don't mention that GDP is also up.

[MU82]

FWIW, I read a CNBC interview with an economist this week and he referred to it as a "rolling recession for lack of a better description" which is why the job numbers continue to be good.  He said it was hitting one sector at a time and as that sector improved and popped back up the next one will slow.  The housing market had been dead and showed an uptick in May followed by the best month in two years in June as buyers have to come to grips that the loan % increase is here to stay.  Travel and hospitality has seen non-stop a flood of spending.  I can say that manufacturing other than defense, aerospace, automotive is extremely slow right now.  Everyone I talk to says the same.  The powers that be decided we are furloughing operators in stages over the next 6 weeks because we don't want to lose them.  I've talked to other manufacturing plants that are on 3 day work weeks.  My customers are telling mew the same both domestic and internationally.  Everything is being pushed out into late 3Q early 4Q.  My customers order forecasts do show a sizeable increase in September and stable after that.

Not sure about the "rolling recession" term (and neither was the interviewee, to his credit), but I do agree with the concept. I'll only add that this kind of thing is quite common.

[TSmith34, Inc.]

Ignore the "Biden Administration" stuff in here and just look at the figures. This started under Trump. Frankly he should take a lot more credit for this (and Operation Warp Speed) than he does, and not focus so damn much on personal vandettas.

He'd like to take credit for it, and he could, except the right-wing decided to make a life-saving vaccine a wedge issue, so he can't without alienating his drooling base. Look no further our own drooling dentist who did a 180-flip, just like Fox told him to do.

[SoCalEagle]

32.3 trillion dollar debt, soaring interest rates, declining real incomes.

"Celebrate good times, c'mon....."

Your post is about a year too late.  Still harping on inflation?  Turns out it was transitory after all.  It increased rapidly just as Biden was coming into office and has shrunk to about half of where it was at its peak, and is still falling.  If you're rooting for America to do well, this is about the best post-COVID outcome you could expect. 

[tower912]

Another half million  jobs added in June.   Stocks down due to fears of FED reaction.

I was wrong.    The official number for June was 209000.   Somebody jumped the gun and I bit.   

The other source has not retracted its 497k tally, though.

[TSmith34, Inc.]

I was wrong.    The official number for June was 209000.   Somebody jumped the gun and I bit.   

The other source has not retracted its 497k tally, though.

I believe that was the ADP report, so scanning different data.

209K is enough to guarantee another rate hike to slow down the economy, so the market dipped. Personally, I think the Fed is overshooting on interest rates with inflation slowing as it has, but they are sticking to their 2% target.

[jesmu84]

The FED has to step in. Can't let those workers get too much leverage.

[MU Fan in Connecticut]

I was wrong.    The official number for June was 209000.   Somebody jumped the gun and I bit.   

The other source has not retracted its 497k tally, though.

The 497 was ADP June report.  Higher than expected.

[Goose]

SoCalEagle

You think inflation has really been cut roughly in half? I think the government economic numbers that are reported are about as believable as the economic numbers that China reports.

As for inflation, I have no idea what items have reduced in price over the past year, but any reduction in certain products was met with increases elsewhere. We have restaurants in our area that raised prices 3-4 times over the past year and have not seen reduction.

[The Hippie Satan of Hyperbole]

SoCalEagle

You think inflation has really been cut roughly in half? I think the government economic numbers that are reported are about as believable as the economic numbers that China reports.

As for inflation, I have no idea what items have reduced in price over the past year, but any reduction in certain products was met with increases elsewhere. We have restaurants in our area that raised prices 3-4 times over the past year and have not seen reduction.

A reduction in inflation isn't a reduction in prices.  (That would be negative inflation or deflation.)  A reduction in inflation means that prices are increasing at a lesser rate.

For example, when inflation peaked last July, it was at 9.1% which meant a 9.1% increase from July 2021.  Inflation this past May was 4.0% - prices were 4.0% higher than May 2022.

I have no idea why you wouldn't believe the governments economic numbers.

[SoCalEagle]

SoCalEagle

You think inflation has really been cut roughly in half? I think the government economic numbers that are reported are about as believable as the economic numbers that China reports.

As for inflation, I have no idea what items have reduced in price over the past year, but any reduction in certain products was met with increases elsewhere. We have restaurants in our area that raised prices 3-4 times over the past year and have not seen reduction.

Goose, don't take it from me, look it up for yourself.  Inflation is less than half of where it was a year ago, and will likely continue to go down.  The good news for me is that inflation is down even lower in my area (running at 3.2%).  I think what you are saying is that you don't like the latest inflation numbers (maybe you want to see them higher for political reasons) so you will ignore them.  Dude, get out and celebrate, things are looking much better now than in the recent past.   

Sultan, you hit the nail on the head regarding how to read inflation.  That's exactly how it works.  And now some economists are thinking that inflation is falling too fast and we may have deflation on the horizon.   For those of you who remember your Econ classes, deflation is much worse than inflation.  Slow down the Fed, they are cutting inflation too fast!!!

[SoCalEagle]

RIVN stock is on fire, up roughly 90% in the past nine sessions. Today shares are hovering around $25, almost double its closing price of $13.45 on June 26.

I almost pulled the trigger on this one, but I got caught flat footed.  Oh well, anyone thinking of buying in at this level?  Pros, cons are welcome. 

[Goose]

Sultan

Thank you for the inflation education. I fully understand the process.

Do you believe the China economic numbers?

SoCal
Deflation or stagflation is something we do not want. As for political reasons, when it comes to economics, I always pull for positives, regardless of the party.

[The Hippie Satan of Hyperbole]

Sultan

Thank you for the inflation education. I fully understand the process.

Do you believe the China economic numbers?

I haven't spent even one second of my life examining China's economic numbers.

[Skatastrophy]

I haven't spent even one second of my life examining China's economic numbers.

There's a reason that the yuan isn't a viable global currency, it's less than 5% of global reserves. Odd thing for Goose to bring up, imo.

[The Hippie Satan of Hyperbole]

There's a reason that the yuan isn't a viable global currency, it's less than 5% of global reserves. Odd thing for Goose to bring up, imo.

I think he does a lot of business there so I can see why he would pay attention to it. I have no need to.

[Skatastrophy]

I think he does a lot of business there so I can see why he would pay attention to it. I have no need to.

Oh that makes sense. From a purely investing standpoint I go out of my way to avoid owning any Chinese companies. You can't trust the government's financials, and you can't trust chinese company financials due to the CSRC not measuring up to the SEC. The SEC does a pretty good job of keeping US public company's financials on the up-and-up. The CSRC does not do the same for chinese public companies.

The current administration has been trying to put pressure on china to get their crap together, we'll see...

[ZiggysFryBoy]

I haven't spent even one second of my life examining China's economic numbers.

Hoo-lee shît, you guys.  Something Sultan isn't an expert in.  Amazing.

[MU Fan in Connecticut]

There's a reason that the yuan isn't a viable global currency, it's less than 5% of global reserves. Odd thing for Goose to bring up, imo.

My intrusive Google news feed keeps giving me news story on the BRICS countries discussing starting a BRICS reserve currency to rival the US$ and to a lesser extent the Euro and Yen and Pound Sterling.  I find the topic interesting.  The consensus of economists says you have to be a major stable economy, none of which any of the BRICS countries are.  Recurring mention of not trusting China monetary numbers either.  And isn't Yuan pegged to the US$?

[Skatastrophy]

My intrusive Google news feed keeps giving me news story on the BRICS countries discussing starting a BRICS reserve currency to rival the US$ and to a lesser extent the Euro and Yen and Pound Sterling.  I find the topic interesting.  The consensus of economists says you have to be a major stable economy, none of which any of the BRICS countries are.  Recurring mention of not trusting China monetary numbers either.  And isn't Yuan pegged to the US$?

They have tried pegging, and decided it was not for them.

This both accurately answers your question, and is a joke. I appreciate you teeing that one up for me.