Ukraine War... How much will S&P drop this week?

[Tim]

There’s not a second that goes by that I worry about the US not being the greatest military power in the world. I’d be more concerned about China more from an economic standpoint. I also wonder how long a country’s people will want to continue under a government like theirs.

Probably not a question of “want”. A question of power , most people choose BATNA, survival or life.

[Zaphod]

Not terribly concerned about China, they snuffed themselves out before they could have a real chance to be a player. Theyre demographically rekt from their one child policy and the resulting choices that were made due to that (favoring boys). Add on a bunch of zero covid lock downs and its even worse.

WIll be fastest rise to power and shift to Japanification in history.

Militarily, not exciting to think about of course, but hopeful doesnt happen, though it seems to be destined, since at least mid 2010s.

Remember the axiom: Currency war, trade war, shooting war...

[Dont_know_mind]

Not terribly concerned about China, they snuffed themselves out before they could have a real chance to be a player. Theyre demographically rekt from their one child policy and the resulting choices that were made due to that (favoring boys). Add on a bunch of zero covid lock downs and its even worse.

WIll be fastest rise to power and shift to Japanification in history.

Militarily, not exciting to think about of course, but hopeful doesnt happen, though it seems to be destined, since at least mid 2010s.

Remember the axiom: Currency war, trade war, shooting war...

What do you think happens with the COVID in China in the next 12 months?
Would be interested to hear your thoughts about it.
They managed to control it after a major outbreak, which no one guessed would happen and now ongoing Covid zero policy it seems.

I think we are at a very interesting point in the market, where there seems to be an overwhelming consensus that there will be a recession before the end of 2023.

I took the plunge and went from 2X to 3X leveraged on my commodity country index positions on 7/1/22 (last friday).

May be there will be a recession, but I like the prices recently. Yields are such that geared at 3X, I estimate that I get back at least 25% of the risk position in dividends in the next 12 months. Unfortunately, with the weakness in the market in the last 6 months, the recent dividend only covered for 70% of the decline in value of the holdings over this period.

Long term though, I really like it, and a 2X LETF position on some of the commodity exporting country indexes is to me like a commercial property that yields 7-10%, with better diversification than a commercial property.

And if there is not a US recession by 2023, or China gets a coherent COVID policy in the next year, I have a feeling this baby will rocket. I must temper this overenthusiastic gut feeling as it has also been massively wrong on occasion in the past.
It is sweet when it's correct though and sized right, which I very much hope here, otherwise could be an uncomfortable 18 months for me...

Maybe I am missing something, but the diversified miners are flush with dividends and unlike 2008, there are no large capex plans on the drawing board and no major supply response yet. So I can't see why the dividend stream cannot continue for another 3 years at a high rate (except with a recession, but then resource prices may bounce back strongly in the recovery as inadequate supply response to date). I have only thought out 1 year at current dividend rate and it is attractive. If it sustains for longer than that, then it could be very good.

The other option could be that I am making the mistake of increasing my resource exposure at peak resource cycle prices and at peak dividends before they crater... I've thought about it a lot lately. I decided to take the risk and am now at 85% of my maximum possible equity risk exposure. I wonder if this is poor discipline, but I figure that I want to just maximise the expected return (and endure a larger drawdown if it occurs). There is a chance that there will be a recessionary bear market (i.e the current bear market + recession + deeper, more prolonged bear market than without recession), but I figured not so much that the risk wasn't worth taking. I also bought some more Uranium exposure last week, now 4% of my equity exposure.

I guess my baseline is that the US will not slip into recession by Q4 2022, setting up for a good year end rally that I don't want to miss out on. Maybe my thinking is too affected by FOMO, greed and recency bias to the recent bull market.

I've thought about it a lot lately and still bit the bullet. Something about the current setup, is irresistable to me.
I could be walking into a ditch, but I just can't resist the pot of gold that I think I see there!
I might be incorrect and horribly wrong, but I think it is a better risk:reward setup than in May 2020 for the investments that I look at.

[Dont_know_mind]

I was thinking about it more today. I think there is a very high probability (in my mind >95%) that US real GDP will be negative in q2. I think this is more a function of wages lagging CPI and the effect of the recent inflation spike. I tend to think there is only a 5% chance the q1 and q2 (if it occurs) negative real GDP growth prints will be classified a recession. I think real rates are still headed higher, but gradually over time. I find it hard to understand why people are falling over themselves to go into cash when real rates are still deeply negative. Still more puzzling and possibly more hazardous than being long crytpo is shorting nominal equities when: inflation is high, unemployment is low, real rates are still very negative. I would tend to think this is the tail end of an inflationary boom. Which could turn into stagflation. But we are not there.

Too much confidence that the Fed is correct in their forecasts. Last year they said rates would be zero for years. This year they say they will take rates to wherever they need to take them to get inflation down.

I've been an avid Fed watcher for decades. I love the theatre. I'm not fast enough to make any profit from following the Fed. I like to fade the people who follow the Fed move. It causes a waterfall and I buy that. I am pretty slow in getting news and it also suits my contrarian tendencies. It will be very interesting to see what happens. This is like a repeat of my experience in the past when I was short equities and wrong, the negative carry just killed me over a 6 month period. This time however, I am on the other side. If I am wrong the extremely positive carry allows me to live to fight another day and if I am right... that will be sweet.

[Tangler]

There’s not a second that goes by that I worry about the US not being the greatest military power in the world. I’d be more concerned about China more from an economic standpoint. I also wonder how long a country’s people will want to continue under a government like theirs.

Economics matter. If you win economically it is only a matter of time before you win militarily.

Money buys stuff.

They are stealing technology and developing the capability to conduct a war our people are not ready for.
Fear motivates the unwilling.
I hope I am wrong.

[CordMcNally]

Economics matter. If you win economically it is only a matter of time before you win militarily.

Money buys stuff.

They are stealing technology and developing the capability to conduct a war our people are not ready for.
Fear motivates the unwilling.
I hope I am wrong.

And they have way more manufacturing than we do. The US needs to start bringing that manufacturing home or else there’s going to be some issues in the future.

[Tim]

And they have way more manufacturing than we do. The US needs to start bringing that manufacturing home or else there’s going to be some issues in the future.

The issue is which policies will encourage that.

"Obama reminds people of what a snake oil salesman sounds like. Lol The best part was during Trumps campaign Obama saying that jobs are not coming back, theres no way those jobs are ever coming back, and then mocked Trump asking him how hes going to make a deal to bring back those jobs. Now we have Obama taking credit for the economy, lmao!!! And immediately after he spoke about taking credit for the economy he claimed that republicans in congress had obstructed him and prevented him from getting anything done. He couldnt get anything done and yet he’s responsible for the economy? Lol

Read more: https://www.city-data.com/forum/poli...nna-do-10.html"
Not intended to start a political thread. Widely different economic objectives.

[Dont_know_mind]

The issue is which policies will encourage that.

"Obama reminds people of what a snake oil salesman sounds like. Lol The best part was during Trumps campaign Obama saying that jobs are not coming back, theres no way those jobs are ever coming back, and then mocked Trump asking him how hes going to make a deal to bring back those jobs. Now we have Obama taking credit for the economy, lmao!!! And immediately after he spoke about taking credit for the economy he claimed that republicans in congress had obstructed him and prevented him from getting anything done. He couldnt get anything done and yet he’s responsible for the economy? Lol

Read more: https://www.city-data.com/forum/poli...nna-do-10.html"
Not intended to start a political thread. Widely different economic objectives.

The Obama years may well have been wasted years. He would probably sell it as preparing the soil for the good stuff about to happen.
More unfortunately, social media or something in the water has moved both parties further to the right and left than usual.
If only sanity returned to the major parties and there was a sensible centre (right or left).

[Tim]

The Obama years may well have been wasted years. He would probably sell it as preparing the soil for the good stuff about to happen.
More unfortunately, social media or something in the water has moved both parties further to the right and left than usual.
If only sanity returned to the major parties and there was a sensible centre (right or left).

"why many doctors and medical professionals are fleeing the CDC and NIH." So many of our institutions have been polarized, it will be difficult to rebuild if there is any attempt to make them "mission oriented". Both government and private. Sanity of the major parties is not the only damage.

[doctorbone]

It’s been 5 months since the war started. What’s the end game? Putin doesn’t look like he’s going to stop. Ukraine doesn’t look like they can win back the territory they lost. Armistice? Looks like the world is moving on.

[Rando]

It’s been 5 months since the war started. What’s the end game? Putin doesn’t look like he’s going to stop. Ukraine doesn’t look like they can win back the territory they lost. Armistice? Looks like the world is moving on.

It's turned into a stalemate. It looks like from on both sides of the aisle the focus has gone from helping Ukraine to punishing Putin. The little blue and yellow flags on Twitter posts and handles are disappearing and no one is doing photo ops with Zelensky.

I think the attention of the world has moved on but we're still bankrolling a war, it's doing tremendous damage and I can't see that it's helping anyone at this point.

[FIREshrink]

Economics matter. If you win economically it is only a matter of time before you win militarily.

Money buys stuff.

They are stealing technology and developing the capability to conduct a war our people are not ready for.
Fear motivates the unwilling.
I hope I am wrong.

This is so important, and anyone who doubts China's ambitions or strategy need only read The Hundred-Year Marathon: China's Secret Strategy to Replace America as the Global Superpower by Michael Pillsbury to get it straight.

https://www.amazon.com/Hundred-Year-Marathon-Strategy-Replace-Superpower/dp/1627790101/ref=asc_df_1627790101/?tag=hyprod-20&linkCode=df0&hvadid=312021238077&hvpos=&hvnetw=g&hvrand=283189316273058341&hvpone=&hvptwo=&hvqmt=&hvdev=m&hvdvcmdl=&hvlocint=&hvlocphy=9033617&hvtargid=pla-524526481399&psc=1

[fatlittlepig]

It’s been 5 months since the war started. What’s the end game? Putin doesn’t look like he’s going to stop. Ukraine doesn’t look like they can win back the territory they lost. Armistice? Looks like the world is moving on.

yeah i saw this coming

[nastle]

It's turned into a stalemate. It looks like from on both sides of the aisle the focus has gone from helping Ukraine to punishing Putin. The little blue and yellow flags on Twitter posts and handles are disappearing and no one is doing photo ops with Zelensky.

I think the attention of the world has moved on but we're still bankrolling a war, it's doing tremendous damage and I can't see that it's helping anyone at this point.

Killing young men of Eastern Europe, that is the policy of western leaders unfortunately
putin obviously doesn’t care about his own losses either

[Kamban]

It's turned into a stalemate. It looks like from on both sides of the aisle the focus has gone from helping Ukraine to punishing Putin. The little blue and yellow flags on Twitter posts and handles are disappearing and no one is doing photo ops with Zelensky.

I think the attention of the world has moved on but we're still bankrolling a war, it's doing tremendous damage and I can't see that it's helping anyone at this point.

This was obvious to everyone except the idiots in congress and our demented chief.

Hopefully we won't be giving away more billions when gas here is >$5/gal and groceries have shot through the roof. The people have had enough of this nonsense.