T Nation

MSN: An Epic Bear Market Is Coming

Evidence suggests that both Wall Street insiders and Main Street everymen are beginning to position themselves for the pain.

A recent piece by The Associated Press provides the basic outline: Average Americans have lost faith in equities and have consistently been selling into strength over the past few years, something that hasn’t happened since records started at the end of World War II.

http://money.msn.com/investing/an-epic-bear-market-is-coming

Could this be the long awaited Obama collapse?

:slight_smile:

LOL i didn’t even have to read past the first paragraph to know Anthony Mirhaydari was responsible for it. Though I did have to look up his name, since I only recognize him by his avatar. He spent all of 2012 espousing the same chicken little bullshit. My investments returned around 17.5% in that bear market of 2012, so I hope this guy is right again! lol

Maybe now you can finish your sex change operation.

Non-US based equities will do fine, as will commods.

Inflation is likely, so corporate debt is dreadful to hold.

[quote]Jewbacca wrote:
Non-US based equities will do fine, as will commods.

Inflation is likely, so corporate debt is dreadful to hold.[/quote]

If you have time, would you please expand upon this.

I personally am mystified at this market. There seems to be no fundamentals to support it other than the fed’s ever continuing dilution.

[quote]JEATON wrote:

[quote]Jewbacca wrote:
Non-US based equities will do fine, as will commods.

Inflation is likely, so corporate debt is dreadful to hold.[/quote]

If you have time, would you please expand upon this.

I personally am mystified at this market. There seems to be no fundamentals to support it other than the fed’s ever continuing dilution. [/quote]

If you read the article, he has a good graph of falling participation in the market beginning in 2007. First serious withdrawal since WWII…

[quote]JEATON wrote:

[quote]Jewbacca wrote:
Non-US based equities will do fine, as will commods.

Inflation is likely, so corporate debt is dreadful to hold.[/quote]

If you have time, would you please expand upon this.

I personally am mystified at this market. There seems to be no fundamentals to support it other than the fed’s ever continuing dilution. [/quote]

LOL @ mystified. Explains it perfect. My mind tells me Jewbacca is 100% correct, but I remember reading as late as early fall that bonds were so hot people couldn’t issue them fast enough.

5 years to actually start making money again, but in all reality, there probably isn’t even any real gains in there with the inflation coming.

Any guesses on the housing market recovery ?

[quote]MaximusB wrote:
Any guesses on the housing market recovery ?
[/quote]

I am personally betting on housing :slight_smile:

For headhunter you need a better Chicken Little:

[quote]jj-dude wrote:
For headhunter you need a better Chicken Little:

[/quote]

PS. “On a calm sea, every captain is a good one” – Roman Proverb

The market is determined by statistical forces with several hundred million actors. Virtually nobody gets it right. If the market is doing consistently poorly or well, then anybody can sound like a pro. On the other hand, people do make statements and eventually some of them – by sheer dumb coincidence – turn out right. These people are the next round of pundits, until what they say fails. Don’t believe any such “experts”.

I haven’t met any economic experts who I thought had a methodology that could explain their subject matter, i.e., my considered opinion as a career scientist is that economics really is just smoke and mirrors. Basing national policy on it is idiocy.

Best economic advice: Learn basic Math ('specially subtraction, which optimists like to short change), then don’t fuck up.

– jj

[quote]JEATON wrote:

[quote]Jewbacca wrote:
Non-US based equities will do fine, as will commods.

Inflation is likely, so corporate debt is dreadful to hold.[/quote]

If you have time, would you please expand upon this.

I personally am mystified at this market. There seems to be no fundamentals to support it other than the fed’s ever continuing dilution. [/quote]

Pretty much this. The debt/gdp is at levels where organic growth is slow and unlikely. CEO’s rather buy back their own shares than invest into growth at this point. This also drives the stock price up.

Also corporate profit margins are already on a very good level so growth is not to be expected from there either.

Looking at the debt and where we are now this volatile era of sideways will most likely atleast continue for another decade or so, and that is IMO the best scenario.

To me it also looks like there would be no fundamentals supporting the rise of indices from these levels (other than fed), but trying to rationalize the behaviour of markets into the future is almost impossible.

[quote]jj-dude wrote:

[quote]jj-dude wrote:
For headhunter you need a better Chicken Little:

[/quote]

PS. “On a calm sea, every captain is a good one” – Roman Proverb

The market is determined by statistical forces with several hundred million actors. Virtually nobody gets it right. If the market is doing consistently poorly or well, then anybody can sound like a pro. On the other hand, people do make statements and eventually some of them – by sheer dumb coincidence – turn out right. These people are the next round of pundits, until what they say fails. Don’t believe any such “experts”.

I haven’t met any economic experts who I thought had a methodology that could explain their subject matter, i.e., my considered opinion as a career scientist is that economics really is just smoke and mirrors. Basing national policy on it is idiocy.

Best economic advice: Learn basic Math ('specially subtraction, which optimists like to short change), then don’t fuck up.

– jj[/quote]

If that’s true, how can people make money on the long term on the markets? It happens, there are traders that base their decisions mainly on the fundamentals (as opposed to the technicals: the mathematical side). If being right is coincidence in the long term they shouldn’t make any money.

Countingbeans, why do you believe the inflation will be that bad? I believe that if the U.S. economy suffers, the whole world will suffer economically speaking. In economic hard times investors invest in traditionally “safe” assets, such as the USD (and gold). Of course if the USD status as safe asset would change, that would be a whole other matter, however I believe that is very improbable.

I don’t get it. We have a President who hikes taxes on the job creators, hikes capital gains taxes on those who invest the most, has no plan for paying down the debt and they predict a bear market.

Go figure.

[quote]Xav wrote:

[quote]jj-dude wrote:

[quote]jj-dude wrote:
For headhunter you need a better Chicken Little:

[/quote]

PS. “On a calm sea, every captain is a good one” – Roman Proverb

The market is determined by statistical forces with several hundred million actors. Virtually nobody gets it right. If the market is doing consistently poorly or well, then anybody can sound like a pro. On the other hand, people do make statements and eventually some of them – by sheer dumb coincidence – turn out right. These people are the next round of pundits, until what they say fails. Don’t believe any such “experts”.

I haven’t met any economic experts who I thought had a methodology that could explain their subject matter, i.e., my considered opinion as a career scientist is that economics really is just smoke and mirrors. Basing national policy on it is idiocy.

Best economic advice: Learn basic Math ('specially subtraction, which optimists like to short change), then don’t fuck up.

– jj[/quote]

If that’s true, how can people make money on the long term on the markets? It happens, there are traders that base their decisions mainly on the fundamentals (as opposed to the technicals: the mathematical side). If being right is coincidence in the long term they shouldn’t make any money.

Countingbeans, why do you believe the inflation will be that bad? I believe that if the U.S. economy suffers, the whole world will suffer economically speaking. In economic hard times investors invest in traditionally “safe” assets, such as the USD (and gold). Of course if the USD status as safe asset would change, that would be a whole other matter, however I believe that is very improbable.
[/quote]

Good question. Stock traders are different than economists. The most important point in buying stock is seeing how the company has been run over time and seeking out competent management practices. This is different than trying to figure out what 1000 companies are going to do in the next 2 years and if consumers somehow “get confidence” to start spending. So for instance I have quite a bit of stock that has been doing well in spite of the supposed recession of which my portfolio has barely taken a note. Taking time to vet who you let use your money is time well spent. If I invested like a lot of people – relying on reports like the OP gave – I’d have been bankrupt years ago. I don’t ever invest in anything I consider to be risky and prefer to take a very long-term approach to wealth management. Works for me, but YMMV.

– jj

[quote]jj-dude wrote:

[quote]Xav wrote:

[quote]jj-dude wrote:

[quote]jj-dude wrote:
For headhunter you need a better Chicken Little:

[/quote]

PS. “On a calm sea, every captain is a good one” – Roman Proverb

The market is determined by statistical forces with several hundred million actors. Virtually nobody gets it right. If the market is doing consistently poorly or well, then anybody can sound like a pro. On the other hand, people do make statements and eventually some of them – by sheer dumb coincidence – turn out right. These people are the next round of pundits, until what they say fails. Don’t believe any such “experts”.

I haven’t met any economic experts who I thought had a methodology that could explain their subject matter, i.e., my considered opinion as a career scientist is that economics really is just smoke and mirrors. Basing national policy on it is idiocy.

Best economic advice: Learn basic Math ('specially subtraction, which optimists like to short change), then don’t fuck up.

– jj[/quote]

If that’s true, how can people make money on the long term on the markets? It happens, there are traders that base their decisions mainly on the fundamentals (as opposed to the technicals: the mathematical side). If being right is coincidence in the long term they shouldn’t make any money.

Countingbeans, why do you believe the inflation will be that bad? I believe that if the U.S. economy suffers, the whole world will suffer economically speaking. In economic hard times investors invest in traditionally “safe” assets, such as the USD (and gold). Of course if the USD status as safe asset would change, that would be a whole other matter, however I believe that is very improbable.
[/quote]

Good question. Stock traders are different than economists. The most important point in buying stock is seeing how the company has been run over time and seeking out competent management practices. This is different than trying to figure out what 1000 companies are going to do in the next 2 years and if consumers somehow “get confidence” to start spending. So for instance I have quite a bit of stock that has been doing well in spite of the supposed recession of which my portfolio has barely taken a note. Taking time to vet who you let use your money is time well spent. If I invested like a lot of people – relying on reports like the OP gave – I’d have been bankrupt years ago. I don’t ever invest in anything I consider to be risky and prefer to take a very long-term approach to wealth management. Works for me, but YMMV.

– jj[/quote]

You have a very intelligent approach. But, keep in mind that when the market as a whole takes a huge dive your stocks will dive with it! Perhaps not quite as low but they will be headed south.

There must be sound economic reasons for investors to keep investing in the market. And if they feel that there are more reasons to be on the sidelines over the next four years your stocks will eventually be effected.

Keep in mind we have a President who punishes success. Large Investors know this and are quite reluctant.

So take care my friend and best of luck to you.

[quote]ZEB wrote:
You have a very intelligent approach. But, keep in mind that when the market as a whole takes a huge dive your stocks will dive with it! Perhaps not quite as low but they will be headed south.

There must be sound economic reasons for investors to keep investing in the market. And if they feel that there are more reasons to be on the sidelines over the next four years your stocks will eventually be effected.

Keep in mind we have a President who punishes success. Large Investors know this and are quite reluctant.

So take care my friend and best of luck to you.[/quote]

You do realize that you CAN NOT foresee the future? No one can. So there is no way you can make decisions as to “sit on the sidelines for 4 years”. What is even worse is you are more likely to be wrong than right in your forecast.

There is actually plenty of studies done on this subject, and they all point out how horrible people are trying to reason the markets long term.

You know… in the beginning of 20th century if someone came to you and told you all the wars and crises we will have would you have invested a single penny?

OK. I wouldn’t buy anything right now. But saying things like, ok I am going to sit this shit out because of the president is just absurb.

[quote]Toohard wrote:

[quote]ZEB wrote:
You have a very intelligent approach. But, keep in mind that when the market as a whole takes a huge dive your stocks will dive with it! Perhaps not quite as low but they will be headed south.

There must be sound economic reasons for investors to keep investing in the market. And if they feel that there are more reasons to be on the sidelines over the next four years your stocks will eventually be effected.

Keep in mind we have a President who punishes success. Large Investors know this and are quite reluctant.

So take care my friend and best of luck to you.[/quote]

You do realize that you CAN NOT foresee the future? No one can. So there is no way you can make decisions as to “sit on the sidelines for 4 years”. What is even worse is you are more likely to be wrong than right in your forecast.

There is actually plenty of studies done on this subject, and they all point out how horrible people are trying to reason the markets long term.

You know… in the beginning of 20th century if someone came to you and told you all the wars and crises we will have would you have invested a single penny?

OK. I wouldn’t buy anything right now. But saying things like, ok I am going to sit this shit out because of the president is just absurb.[/quote]

Not at all absurd. I withdrew from the market a couple of years ago after it came back. I then put some of the money into realestate and I’ve made a killing as housing prices were quite low. The rest of that money went into my small business which has also done well.

By the way, if you check the number of government regs at the beginning of the 20th century you’d see why the market ended up doing well over time. We are currently in an anti-business climate promulgated by an anti-business…“soak the rich” US President. If you want to leave your money in the market good luck to you. But, as for me, and millions of others, I am tired of being persecuted for doing well. I don’t like the raise in capital gains taxes only for those who make a certain amount of money. And I don’t like other changes (Obamacare etc.) which the socialist Obama has put through. Hence, I am indeed sitting on the sidelines until we have a more busienss friendly President.

And that does not only go for the markets it also goes for my small business. I am cutting back wages (not bonuses so they can make it back by performance). Those in Washington who actually thought that I was going to pay an additonal 5% in taxes simply because I have done well are mistaken. That tax hike is being passed on to my employees and to my customers. And most likely every business is doing the same thing.

I don’t have to invest a dime in the market or expand my business. I’m sitting tight for the next four years. And if you don’t think some very serious professionals are doing the same thing then you don’t really know what you’re talking about.

http://money.cnn.com/2010/05/16/markets/individual_investors/

Business people, both of the investor and small business class, across the country will react to Obama’s reelection in their own best interests. Obama’s attack on the successful will leave him with unintended consequences.

Ah, ZEB, ofcourse if you choose to invest to something else it is very smart. I was just saying laying all your money in the bank account where inflation slowly eats away the value is not smart.

I don’t live in the USA, but I’ve heard a lot of people I personally know say the same as you just did. Taxes go up -> it is a shared pain. They look to hire people to do less hours per week etc.