Stock Market

[E. Bryant]

Poor SOB working the customer service phones that day: "Do you get any error messages on your Tesla app at all?"

I would like to point out that while my Ford Econoline E-350 suffers from a number of flaws that would be unacceptable to modern EV buyers, it also is at low risk from suffering a broken window due to slamming the door too hard and that I've yet to break off any pieces of the frame while attempting to recover other vehicles (and if such a calamity were to occur, it could be fixed by a local farmer with a buzz-box stick welder).

 

[NoDopes]

Serious increase in mortgage delinquency

Soft landing will feel like that cyber over the culverts

 

[Bigfatcock]

My dividends buy my stonks. DCA for life.

 

[kthomas]

Trump's still gonna support policies which require printing trillions. What the markets are starting to price in is how that money will be allocated differently than the current administration.

Our deficit ballooned under Trump. People seem to forget that.

We are now $35T in debt...

 

[kthomas]

Investment firm says massive short of Truth Social stock before Trump shooting was ‘filed in error’

Who knew!!! All you have to do once you short a stock the day before a major event like this and it goes against your favor is you call your broker and say, “Whoops! My bad. I want a do-over on that. Then they’ll say, ‘No problem buddy. We gotcha covered.’'

I did not know the stock market worked like that. Amazing!!!!

How can an error like this even be made?

 

[Emerson0311]

https://www.cnbc.com/2024/08/01/wayfair-w-earnings-q2-2024.html

Full disclosure - my current gig is in an adjacent slice of the consumer durable goods market, and we are not (yet) seeing what's reported here. But it should surprise no one if/when it comes because consumers are simply tapped-out by the past several years of increasing costs and flat wages.

Being tapped out is what I’m seeing on the ground among trades and resource workers locally. We make more than we ever have have in $$$, and we are right back in the early 20’s always coming up short ethos.

 

[Emerson0311]

How can an error like this even be made?

We know how; only if it’s on purpose.

 

[kthomas]

I’m seeing boats, vehicles, houses etc local to me all being offered a lot cheaper than anytime since 2019. By the spring the employed will be in a good spot.

There's certainly been some signs of my area of a looking recession.

I can get any contractor to come over to my house at the drop of a hat, they are all hungry for work. People are spending much less money than just a couple of years ago, when it was impossible to get any sort of a contractor over.

It's also been a really rough time to find a job, the job market sucks. I've been looking for employment for over a year, and any company interested in me says they just can't afford to hire on new people.

The largest growing sectors of the economy are the government and healthcare. That's not good.

 

[kthomas]

We know how; only if it’s on purpose.

It's the only one that makes sense.

I don't know how you "accidentally" short a stock like that. Makes no sense.

 

[Emerson0311]

It's the only one that makes sense.

I don't know how you "accidentally" short a stock like that. Makes no sense.

Just proves how greedy and shameless the deep state is. They don’t even care if it’s obvious, because the clot shots and easy living have dumbed down the population.

 

[eca7891]

My dividends buy my stonks. DCA for life.

I have a good chunk in those as well.


Maybe 30%+ in one portfolio .

That’s individual stocks.

The mutual fund portfoli pays well too. (VPMAX, VWNAX)

 

[IronSkillet]

“Berkshire still owns 980.06 million shares of the company.”

Now he is dumbing apple .
Maybe is selling off just enough not to panic the masses as he stocks up on cash ?

https://www.cnbc.com/2024/08/03/berkshire-hathaway-earnings-2024-q2.html

 

[Redmanss]

Now he is dumbing apple .
Maybe is selling off just enough not to panic the masses as he stocks up on cash ?

https://www.cnbc.com/2024/08/03/berkshire-hathaway-earnings-2024-q2.html

As simple of an investor as Buffett is, still hard to say exactly why he's cut so much Apple. Too much single exposure (likely), herding cash for a coming dip buying spree, whale in the waiting (Occidental?), nobody will know until it happens. Same goes for BofA sales recently. He's a T-Bill buying cash whore anyhow, I'm okay with that so long as he strikes when the timing is right, didn't care for his sideline sitting in '20.

Full disclosure, I own a fair amount of BRK.B.

 

[E. Bryant]

For those that can't remember the last crab because it was so long ago, here's Berkshire's 2008 annual report:

https://www.sec.gov/Archives/edgar/data/1067983/000119312509042455/dex991.htm

Please note the following:

Berkshire has two major areas of value. The first is our investments: stocks, bonds and cash equivalents. At yearend those totaled $122 billion (not counting the investments held by our finance and utility operations, which we assign to our second bucket of value). About $58.5 billion of that total is funded by our insurance float.

Also recall one of Warren's most famous quotes:

Buy when there's blood in the streets, even if the blood is your own.

Gotta have a cash position in order to play that game. BRK looks to be setting itself up once again for the potential of an upcoming fire sale.

 

[375fan]

As simple of an investor as Buffett is, still hard to say exactly why he's cut so much Apple. Too much single exposure (likely), herding cash for a coming dip buying spree, whale in the waiting (Occidental?), nobody will know until it happens. Same goes for BofA sales recently. He's a T-Bill buying cash whore anyhow, I'm okay with that so long as he strikes when the timing is right, didn't care for his sideline sitting in '20.

Full disclosure, I own a fair amount of BRK.B.

Isn't he sitting on billions in cash presently? Based on some of his past comments, I don't think he sees anything worth buying or feels prices too high to support their values on the majority of stocks at this time. He is a solid value investor. Just my take.

 

[doubloon]

Isn't he sitting on billions in cash presently?

Half as much as 2021.

About the same as last year, about the same as the year before ...

Cash or cash equivalent.

 

[XTREM HTR16]

Reckon I’ll follow Warren. Cash out and then buy back in….

 

[doubloon]

Reckon I’ll follow Warren. Cash out and then buy back in….

I could be wrong but ...

Technically his cash position hasn't changed since 2022 ... in 2021 he had ~$88B in cash ... last three years it's been ~$38B-ish in cash ... in 2020 (doing the math backward) it was $40somethingishB in cash before he sold a bunch of shit pushing it to ~$88B ... Chevron? can't remember

If I had $38B it would all be in mattresses and glass jars and tree stumps ... and ammo

 

[S3th]

You need to consolidate cash and equivalents plus investments in treasuries since they break that line out. Berkshire is sitting on $270B of cash and cash eq.

 

[Lightning8]

I could be wrong but ...

Technically his cash position hasn't changed since 2022 ... in 2021 he had ~$88B in cash ... last three years it's been ~$38B-ish in cash ... in 2020 (doing the math backward) it was $40somethingishB in cash before he sold a bunch of shit pushing it to ~$88B ... Chevron? can't remember

If I had $38B it would all be in mattresses and glass jars and tree stumps ... and ammo

I would have my own small nation somewhere. "Who's John Galt" style.

 

[Lightning8]

Interesting historical chart. Seems like we are in/near a recession with hiring steadily trending down plus unemployment consistently rising (and I think actual unemployment numbers worse).

 

[kthomas]

View attachment 8472582

Interesting historical chart. Seems like we are in/near a recession with hiring steadily trending down plus unemployment consistently rising (and I think actual unemployment numbers worse).

Where did this chart come from?

I haven't seen the unemployment rate be reported as 7.3% anywhere, but I do believe it. BLS is currently reporting 4.3% for July

Unemployment rate doesn't tell the full picture. In order to be counted as unemployed per the BLS, you have to be "actively looking" for work. Those that are discouraged from the current job market (and many are), have simply given up. They are not considered unemployed. And apparently this is at an all time high, especially amongst middle aged men.

The current job market sucks (I unfortunately knew all too well), so I believe this graph. But I'm really curious where the 7.3% comes from.

 

[Redmanss]

Where did this chart come from?

I haven't seen the unemployment rate be reported as 7.3% anywhere, but I do believe it. BLS is currently reporting 4.3% for July

Unemployment rate doesn't tell the full picture. In order to be counted as unemployed per the BLS, you have to be "actively looking" for work. Those that are discouraged from the current job market (and many are), have simply given up. They are not considered unemployed. And apparently this is at an all time high, especially amongst middle aged men.

The current job market sucks (I unfortunately knew all too well), so I believe this graph. But I'm really curious where the 7.3% comes from.

That’s from ‘08.

 

[Lightning8]

Where did this chart come from?

I haven't seen the unemployment rate be reported as 7.3% anywhere, but I do believe it. BLS is currently reporting 4.3% for July

Unemployment rate doesn't tell the full picture. In order to be counted as unemployed per the BLS, you have to be "actively looking" for work. Those that are discouraged from the current job market (and many are), have simply given up. They are not considered unemployed. And apparently this is at an all time high, especially amongst middle aged men.

The current job market sucks (I unfortunately knew all too well), so I believe this graph. But I'm really curious where the 7.3% comes from.

Look at the trend - I said "historical". Leading up to 2008. There are a ton of FRED graphs showing rising unemployment and reduced hiring. Government seems to release jobs numbers every month then quietly revise down.

 

[nso123]

I think the crash of 08 is different from anything we have brewing right now. I am leaning more toward a dot com bubble burst type situation. I have been slowly rebalancing everything for the last month or so. I managed to lose less than 1% value in my portfolios Friday, so I am pretty satisfied that I can weather things for now. That being said, I am trying to avoid taking a lick that would knock me back 10 years, even if I have to give up some amount of potential gain for now. My plan is to work for roughly ten more years before retiring.

 

[S3th]

Bonds were a good trade at the peak of this interest rate cycle. If Septembers rate cut doesn't come, extremely unlikely, Treasury ETFs will sell off. That's a re-entry point.

The more a 50bp cut gets priced in, the more they will run up.

 

[kthomas]

Shit, thanks guys! Obviously I'm still waking up over here

I was genuinely curious if there was someone tracking unemployment rates in a manner that was more representative of reality than the BLS.

 

[Lightning8]

 

[Lightning8]

 

[Lightning8]

 

[Redmanss]

I could be wrong but ...

Technically his cash position hasn't changed since 2022 ... in 2021 he had ~$88B in cash ... last three years it's been ~$38B-ish in cash ... in 2020 (doing the math backward) it was $40somethingishB in cash before he sold a bunch of shit pushing it to ~$88B ... Chevron? can't remember

If I had $38B it would all be in mattresses and glass jars and tree stumps ... and ammo

The stack of "cash" is mostly held in short term T-Bills where BRK is earning ~5% on those holdings. Parking that money somewhere safe while making something from it is the Buffett way of doing business. (Yes, I know calling USG T-Bills "safe" in the Bear Pit is its own conversation, saving that one for another time.) Here's the latest 2Q consolidated balance sheet, take a look at those equities and T-Bill differences from 6mo earlier.

That's a fire sale happening right before the fire starts, as fast as a company the size as Berkshire can make it happen without cratering an equity on their own while still selling it off.

The one extrapolation I've made is Buffett is smelling something huge coming, more than a simple correction or election uncertainty that he always rides out, but it's like he sees a bloody grizzly in his pasture hovering over the shredded carcass of his prize bull.

 

[Californio]

2008 Warren Buffett came in and made sweetheart deals and made piles of money. Since December 2023 he has sold off Apple and BofA adding almost 200B to his cash hoard, pay attention.

 

[doubloon]

The stack of "cash" is mostly held in short term T-Bills where BRK is earning ~5% on those holdings.

Yeah "cash" as an investment term has never meant just actual stacks of money ... includes holdings that are high liquidity and lower risk.

 

[Redmanss]

Yeah "cash" as an investment term has never meant just actual stacks of money ... includes holdings that are high liquidity and lower risk.

Very true, admittedly myself and others lazily type out “cash” in here for brevity because we’re typing this on our phones and leave a level of assumption for others to interpret it to mean other holdings and equivalents. I’m far from a reporter for the WSJ.

 

[doubloon]

Very true, admittedly myself and others lazily type out “cash” in here for brevity because we’re typing this on our phones and leave a level of assumption for others to interpret it to mean other holdings and equivalents. I’m far from a reporter for the WSJ.

Si.

Me too, that's the same way I used it in my previous post to say his "cash" position hasn't changed in like 3 years.

Stock Market

If Intel sees a 1 handle, I am opening a small 200-share position. traded the morning volatility for a 5% gain

www.snipershide.com

 

[E. Bryant]

Here's the graphic floating around Twitter this weekend:

At today's prices, this buys Intel and Wells Fargo. If things go south 2008-style (which is definitely within the range of possibilities) then Warren is going to end up owing multiple banks plus large swathes of other industries.

 

[375fan]

Here's the graphic floating around Twitter this weekend:

View attachment 8472975

At today's prices, this buys Intel and Wells Fargo. If things go south 2008-style (which is definitely within the range of possibilities) then Warren is going to end up owing multiple banks plus large swathes of other industries.

He knows a correction is coming and is getting prepared for good buying opportunities.

 

[E. Bryant]

From Berkshire's 2009 annual report:

Charlie and I avoid businesses whose futures we can’t evaluate, no matter how exciting their products may be. In the past, it required no brilliance for people to foresee the fabulous growth that awaited such industries as autos (in 1910), aircraft (in 1930) and television sets (in 1950). But the future then also included competitive dynamics that would decimate almost all of the companies entering those industries. Even the survivors tended to come away bleeding.

Just because Charlie and I can clearly see dramatic growth ahead for an industry does not mean we can judge what its profit margins and returns on capital will be as a host of competitors battle for supremacy. At Berkshire we will stick with businesses whose profit picture for decades to come seems reasonably predictable. Even then, we will make plenty of mistakes.

We will never become dependent on the kindness of strangers. Too-big-to-fail is not a fallback position at Berkshire. Instead, we will always arrange our affairs so that any requirements for cash we may conceivably have will be dwarfed by our own liquidity. Moreover, that liquidity will be constantly refreshed by a gusher of earnings from our many and diverse businesses.

Fascinating that this can so easily be compared and contrasted with events occurring 15 years in the future. It's almost like the market and investors have been here before.

 

[S3th]

Holy shit. Anyone looking at the overnight market?

 

[kthomas]

Looks like the Nikkei is in free fall right now. Same with crypto.

What is happening?

 

[E. Bryant]

Holy shit. Anyone looking at the overnight market?

Japan is starting off its week with some spiciness.

The Yen/USD is getting ready to kiss 145. It was a hair shy of 162 less than four weeks ago. I fully expected to see hints of 2000 and 2008 in the next crash, but I guess we're getting some 1997 flavor as well.

 

[NoDopes]

Holy shit. Anyone looking at the overnight market?

Just more corrections from Friday?

 

[E. Bryant]

It appears that crypto will not be playing the role of safe harbor at this time.

 

[E. Bryant]

Just more corrections from Friday?

This feels a bit deeper.

 

[E. Bryant]

Looks like the Nikkei is in free fall right now. Same with crypto.

What is happening?

BOJ attempted to hike rates last week... from 0.1% all the way to 0.25%. This was presumably done to arrest the free-fall of the yen, but it seems that they at the very least broke the yen carry trade, which now seems to be fueling some sort of contagion event.

All the Very Smart People(tm) assured us that this can't happen as Things Are Different From Last Time(tm).

 

[kthomas]

BOJ attempted to hike rates last week... from 0.1% all the way to 0.25%. This was presumably done to arrest the free-fall of the yen, but it seems that they at the very least broke the yen carry trade, which now seems to be fueling some sort of contagion event.

All the Very Smart People(tm) assured us that this can't happen as Things Are Different From Last Time(tm).

I'm curious to see what tomorrow brings...

 

[david walter]

So, stops closely placed? Or?

 

[E. Bryant]

I'm curious to see what tomorrow brings...

The Nikkei 225 closed down 12.5%, and is now down 20% in the past three sessions (and about 25% off the all-time high set about three weeks ago). The yen strengthened by 2.5% in just one day and broke below 143.

The amount of stuff breaking right now is insane. But Jpow and Yellen will soon be along to announce that the printer is getting fired up again, and that's going to kick off a heck of a short-term rip.

 

[Bigfatcock]

Who’s ready for some deflation buying?

 

[IronSkillet]

Black Monday