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livinincali
Participant[quote=SK in CV]
AAPL hasn’t been a growth play for a very long time. I can’t find any older data real quickly, but it hasn’t had a P/E of over 25 for at least 5 years. FB, based on most recent quarter earnings is at about 50, it was in the thousands not too long ago. Amazon is still over a thousand.[/quote]P/E has nothing to do with growth rates. Stocks with high growth tend to support higher P/Es but growth is about total revenue YoY and total earnings YoY. Even earnings/share isn’t as good of a measure because of all the stock buybacks we’ve seen. For example AAPL earnings/share went up YoY but their total earnings went down YoY.
Participant[quote=CA renter][quote=paramount]Are there deflationary signals right now? In the bond market maybe?[/quote]
There have been deflationary signals for many years. Why do you think the Fed has been intervening so much in our economy? ZIRP is almost always a sign of deflation, IMO.[/quote]
Yup we’re doing the same thing as Japan’s been doing for the past 20 years. Fighting deflation at all costs. In doing so, we are slowing down the growth of our economy as too many productive assets have to be allocated to debt repayment. If you let the too big to fail, actually fail you solve many of the problems in the economy including income inequality. Now people sitting on the other side of the balance sheet looking to collect rent on the productive segment of the population hate this idea, but it would get our economy growing again as we’d have more money to invest in productive things.
Participant[quote=flu]Damn. FB @ $63/share premarket… Short sellers getting squeezed?[/quote]
Maybe, but there isn’t much short interest on FB. Less than 1 day to cover and only 2.5% of the float is short. It’s likely just everybody desperately chasing the few stocks that are actually growing at a reasonable rate. Everybody that sold AAPL the other day because it’s no longer a growth play is looking for the next growth play.
I’m really not that excited about QCOM earnings. Yeah they beat the street but they’re down YoY, Mobile is definitely slowing down on the hardware side. Software might still be ok, but AAPL, Samsung, and QCOM are all showing signs that high-end mobile has reached saturation point.
Participant[quote=The-Shoveler]I would like to see something like that.
“infrastructure investment”
completing the train along the 15 would get a lot of cars off the road, or even just completing riverside to San Diego Via OceamSide station (the missing link) would be a massive change for the better for both counties.
(already goes to OC and LA).[/quote]
Additional light rail would be good and hopefully reasonably cost effective. Of course instead we’re going to waste 10 billion dollars building high speed rail between cities in the central valley that don’t make any sense. Of course in today’s world of campaign finance we don’t get good infrastructure investment we get hand outs to campaign contributors to build useless stuff at a massive cost.
Participant[quote=spdrun]Big unknown as to how, though. Pushing money into speculation diverts it from productive activities. Remember that the Fed tightened and KEPT tightening even after the NASDAQ bubble started deflating in 2000.
[/quote]I think the fed’s committed to completing the taper no matter what happens to the stock market or the economy. Their ego’s are too big and they are slow to act. The economy could enter recession later this year and QE reboot probably wouldn’t come until mid 2015 at the earliest. Even if QE or some other stimulus did come back quickly after the economy declined it will be too late. The confidence in the fed will already be eroded at that point.
Most of the bullish analysts are betting on heads I win tails you lose kind of logic right now. I.e. if the economy does poorly it’s ok to be long because the fed will be there to bail out the market, or it’s ok to be long because the economy is getting better.
Participant[quote=The-Shoveler]
He who out prints and out spends wins.[/quote]No, they create the biggest bubble, which eventually comes crashing down.
Participant[quote=The-Shoveler]The ones left holding the bag will be anyone who is holding renminbi (RMB).
They have far far far out printed the whole world.
This is how we are losing the stimulus game LOL
They build infrastructure, we make enemies destroying it.
Turning dollars into smoke, noise and ash.[/quote]No we are losing the stimulus game because demand is local and supply is global. In addition the stimulus game doesn’t work when you’re already deeply in debt (i.e. Japan). There is no fiscal solution to the too much debt problem we face. The solution is to embrace default and deflation and get back to a point where we can grow the economy again.
Granted that destroys plenty cities and pension funds but that already happened. There’s nothing you can do to change the fact that those plans are unfunded and there’s no way to make good on them. We just haven’t decided to realize that yet.
Participant[quote=CA renter][quote=AN]DOW to 5K will mean recession worse than what we saw recently. Which means we’ll see housing price < than what we saw this last bottom and unemployment >10%. Yeah, that’ll be fun.[/quote]
Not fun, but entirely possible, IMHO. This is why the reflation of the credit bubble was such a bad idea. They encouraged even more speculation, which was the problem in the first place.
Should have let things settle back to normal after 2008, save for some real jobs programs, infrastructure, and energy-related spending. We were almost there, but then they goosed everything back to bubble levels again. Now, we have even more debt than we would have if they had let things fall, and we are in an even weaker position because people have been dealing with declining wages and using up their savings for so many years. Best to get bad things over with quickly instead of prolonging them for years or decades.
IMHO, we are going to be in a deep recession by 2016/2017.[/quote]
I tend to agree but I personally think the main street sector of the economy won’t be much worse off than if currently is if the stock market bubble pops. This time around the bubble isn’t employing many people (i.e. why the recovery has been so weak so far).
Participant[quote=AN]People don’t sell unless they can buy another. People can’t buy if they don’t have a job. People don’t sell if they’re underwater. They won’t sell if they have no equity to help them buy their next house. So, you’ll never have # of sellers > # of buyers, if you have people able to stay in their houses for free. We’ve seen that happen recently.[/quote]
What about the real estate investors/speculators that bought with all cash. Can they sell?
ParticipantIf you believe in Federal Government bailouts, just buy some MUB.
Participant[quote=flu]
No AN, they are closing that Hooters down. A real estate investor bought the shuttered Vagabond Inn next to it and the Hooters building, and wants to turn it into a hotel again I guess. So the Hooters is being relocated to San Marcos….according to people who know… (not me… of course)….[/quote]
Yeah. Those properties were purchased in Jan 2012 by HP-RB Hotel LP for a little over 3 million (looks like a Mom and Pop operation). The Hooters lease run until March 2016, but I’m sure they might be able to work something out prior to the end of the lease term.
January 13, 2014 at 9:01 AM in reply to: Off Topic: How much home can you afford-not what you think #769718Participant[quote=flu]This really isn’t any different than people who win all those big prizes on the Price is Right… They lady who recently won then Audi R8 convertible is most likely going to take the cash prize instead of the actual car… I seriously doubt she has the finances to pay for the income taxes, registration,etc for a $150k+ new car…
http://www.autoblog.com/2013/12/30/woman-wins-audi-r8-price-is-right-biggest-prize-ever/%5B/quote%5D
There is no option for a cash prize on the price is right. You can either take the prize and pay income taxes on the full retail amount or you can forfeit the prize. For a specialty item or something non transferable like a trip that would be hard to sell on craigslist for something at least 50% of full retail it might be better to just forfeit prize.
Participant[quote=6packscaredy]Could you have a separate contract to be paid a monthly fee for the loan, at some discount to the actual savings?[/quote]
I suppose you could house carry some sort of contract but there’s nothing backing it. If the person chooses not to pay you don’t have equity to go after. It also has to come out of the buyers income so it might be hard to find the buyer where the assumable loan is 25% of their gross and they have another 5% to pay you.
January 13, 2014 at 8:37 AM in reply to: Got to love Elizabeth Warren “the antidote to CNBC” #769715Participant[quote=spdrun]^^^
Glad that we have more conservative Fed voting members this year to counterbalance her worst impulses, then.
Not sure if her ideas would work anyway — despite QEx, participation rate was at an all-time low last month.[/quote]
About the only thing that QE succeeds in doing is creating a bubble in asset prices somewhere. That only helps if the asset bubble is in something the general economy can participate in. In 1999 the asset bubble created a job for anybody that could write a little html. In 2004-2006 it created a bunch of jobs for real estate related activities.
This time there is no big thing in the general economy that’s related to the asset bubble in bonds and stocks, unless you want to point to increases in food stamps and disability. There was a little increased business in refinancing but that’s gone now. There was also a little increase in mobile/web 2.0 but nothing compared to 1999 and more difficult for the average Joe to retool into. Mobile web development is a little over the head of your average mortgage broker and automation has come a long way since 1999.
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