Ron Paul: 50% stock market plunge 'conceivable'

[ghostParticipant]

Ron Paul: 50% stock market plunge ‘conceivable’

Thoughts?

[The man in the mountainParticipant 4102]

I voted for Ron, what a shame that he didn’t get in before Obama sold us off, we are what? 20 trillion into the ground? America it’s time you realize that someone owns you and they are of a specific religious background…

[ghostParticipant]

The man in the mountain wrote:

we are what? 20 trillion into the ground?

debt clock

[BeerParticipant 11832]

Sadly, I think most stocks are cheap right now. I say sadly because we have devalued the dollar so much. If our money supply has quadrupled since pre-financial crisis while the value of the stock market has doubled it seems like we’ll be looking back at 2017 prices 10 years from now thinking damn, stocks were cheap back then. It doesn’t actually mean we’ll have more purchasing power or be relatively more wealthy…it just means we’ll have bigger numbers in our brokerage accounts and 401ks.

[ghostParticipant]

Beer wrote:

Sadly, I think most stocks are cheap right now. I say sadly because we have devalued the dollar so much. If our money supply has quadrupled since pre-financial crisis while the value of the stock market has doubled it seems like we’ll be looking back at 2017 prices 10 years from now thinking damn, stocks were cheap back then. It doesn’t actually mean we’ll have more purchasing power or be relatively more wealthy…it just means we’ll have bigger numbers in our brokerage accounts and 401ks.

Interesting. Do you not worry about inflation?

[RemovedParticipant 4676]

Beer wrote:

Sadly, I think most stocks are cheap right now. I say sadly because we have devalued the dollar so much. If our money supply has quadrupled since pre-financial crisis while the value of the stock market has doubled it seems like we’ll be looking back at 2017 prices 10 years from now thinking damn, stocks were cheap back then. It doesn’t actually mean we’ll have more purchasing power or be relatively more wealthy…it just means we’ll have bigger numbers in our brokerage accounts and 401ks.

And ever since we removed the gold for being the backing of the dollar, and made it the value of the word of the government… Just makes it a joke.

I would worry about inflation, but the currency doesn’t really have a true value anymore. It is based on an idea, so how exactly do you consider its value.

I do not believe that the stock market will crash. This is just another politician that is in the system, that is unhappy with the power shift, and just proclaiming another doomsday prediction. The politicians have said one thing after another would happen each and every day. Why would I believe another cry wolf politician?

[HydroParticipant 164]

Yes it is definitely possible. We’re in a nine year bull market and stocks are currently at or near all-time record highs. In my view now is not a good time to put money into the broad stock market, most stock index funds, or general stock market type mutual funds. Stock prices are just too high. I see a lot of stocks right now that insanely overpriced – Amazon at a price-earnings ratio (PE) of 180, Netflix PE 215, Tesla PE is negative 73! That’s right, Tesla’s current stock price is $348 for a company that is actually losing $4.77/share per year. Many of the so-called blue chip stocks are very expensive right now – Chevron PE is 69, Exxon Mobil PE is 32.

IMO the time to buy an asset is when the everyone has capitulated, bailed out and taken their lumps & losses, and the crowd has no interest in it and have moved on to other investments. That’s when the real bargains can be found. If you have the courage to step in and buy after the masses have given up hope and the asset has been decimated and left for dead.

[ghostParticipant]

Hydro wrote:

Yes it is definitely possible.

I agree, it does worry me a bit. I think you make some very good observations and I definitely agree with your last point. It is never easy to buy at those points in time.

[xlrsnbrgParticipant 1786]

I will laugh if it happens. All the incompetents hired through feminist quotas will be laid off.

A man shouldn't make his life's objective to be on the side of the majority, but to avoid finding himself in the ranks of the insane. (Marcus Aurelius)

[Anonymous 42]

No losses to report here!

F~~~ED ONCE, SHAME ON YOU WALL STREET!

F~~~ED TWICE, SHAME ON ME WALL STREET!

Those MOTHERF~~~ERS GOT A BAILOUT!

I GOT F~~~ED FOR THE WHOLE ENCHILADA!

I’m purchasing almost 50 lbs. a week in rice and beans! I know what a good investment looks and TASTE LIKE!

EAT S~~~ WALLSTREET! AND DIE! MOTHERF~~~ERS!

[BeerParticipant 11832]

ghost wrote:

Interesting. Do you not worry about inflation?

I think we’re in for some years of higher inflation in the near future as reality catches up to Obama era policies, but I can’t do anything to control it. All I can do is invest my money so it grows. I doubt I’d do much different if you told me we will have 2% inflation next year vs 10%. All I can do is invest and hope my returns continue to be bigger than inflation each year.

Hydro wrote:

Stock prices are just too high. I see a lot of stocks right now that insanely overpriced – Amazon at a price-earnings ratio (PE) of 180, Netflix PE 215, Tesla PE is negative 73! That’s right, Tesla’s current stock price is $348 for a company that is actually losing $4.77/share per year. Many of the so-called blue chip stocks are very expensive right now – Chevron PE is 69, Exxon Mobil PE is 32.

You just have to look at what your buying. I wouldn’t touch Amazon with their ridiculous P/E because they are already so huge that for them to have a reasonable P/E either they have to multiply in size like 20x over(good luck with that) or their share price has to plummet(I see a higher chance of this). Same for TSLA. The market values them higher than GM or Ford while they bleed money year after year, wouldn’t exist without government subsidies, and sell a fraction of the cars either of the other two does. Even if they turn into a legit car manufacturer over the next decade, how much more can their stock go up when its already valued at what other large car manufacturers are?

I mainly just invest in dividend payers myself, and I’m more concerned about their ability to pay their dividends than the P/E. Why should I care if a company has a P/E a little higher than its historical average if they are paying out dividends maybe with only 60% of their free cash flow? They can easily cover that without having to borrow money or sell assets, and they have room to grow…works for me. In the end if I’m parking money in a 1% account vs putting it in a stock that pays a 4% dividend and reinvesting I’m still coming out ahead even if stock prices are flat for the next few years.

More or less I’ve come to the conclusion that we aren’t in an 8 year bull market…we are in an inflationary market.

[MarketWatcherParticipant]

Beer wrote:

Sadly, I think most stocks are cheap right now. I say sadly because we have devalued the dollar so much. If our money supply has quadrupled since pre-financial crisis while the value of the stock market has doubled it seems like we’ll be looking back at 2017 prices 10 years from now thinking damn, stocks were cheap back then. It doesn’t actually mean we’ll have more purchasing power or be relatively more wealthy…it just means we’ll have bigger numbers in our brokerage accounts and 401ks

Beer wrote:

You just have to look at what your buying. I wouldn’t touch Amazon with their ridiculous P/E because they are already so huge that for them to have a reasonable P/E either they have to multiply in size like 20x over(good luck with that) or their share price has to plummet(I see a higher chance of this). Same for TSLA. The market values them higher than GM or Ford while they bleed money year after year, wouldn’t exist without government subsidies, and sell a fraction of the cars either of the other two does. Even if they turn into a legit car manufacturer over the next decade, how much more can their stock go up when its already valued at what other large car manufacturers are?
I mainly just invest in dividend payers myself, and I’m more concerned about their ability to pay their dividends than the P/E. Why should I care if a company has a P/E a little higher than its historical average if they are paying out dividends maybe with only 60% of their free cash flow? They can easily cover that without having to borrow money or sell assets, and they have room to grow…works for me. In the end if I’m parking money in a 1% account vs putting it in a stock that pays a 4% dividend and reinvesting I’m still coming out ahead even if stock prices are flat for the next few years.

Spot on analysis. You know what you are talking about and I agree with your opinion of Amazon. However they achieve the super high PE by deferring profit through tax loopholes. The market knows it and gives it a pass.

[PrincekieParticipant 1042]

Thoughts:

1. Mainstream media going on about how the great recession of 2007-08 is “over”. GET TO F~~~! It NEVER went away. Over $20 trillion debt, plus accumulated debt, plus another $10 trillion in new debt….
2. The money printing presses have been on bloody overtime printing s~~~loads of worthless fiat currency.
3. Before every recession/plunge/depression there’s always low unemployment plus stock market highs. Don’t believe me? Look at the late 80s, 2001 and 2006.
4. Here’s something that’s a weird coincidence… every single stock market crash has taken place in October. I’ve heard a rumours/warnings that October 16th 2017 could see a major downward slide in the market. Don’t shoot the messenger!
5. We’re in the midst of bubble territory. We’ve got housing market bubbles (cheap low interest loans holding up a non existent market), case loan bubble, MAJOR CHINESE HOUSING AND STOCK MARKET BUBBLE, bubbles on top of bubbles….basically when this thing bursts it’s gonna take a LOT of people down.
Nothing’s changed since 2008. Nothing apart from the amount of debt that’s been accumulated since then.

[PrincekieParticipant 1042]

Here’s something else I’m thinking that looks fairly s~~~e.

Here in the UK we get government borrowing tomorrow. If they borrowed more this July than last (and I predict they have) its another sign the tax take has topped out before they even get close to getting the deficit down. That’s a horrible position to be in. If the BOE print now they see inflation creep up and wages fall,if they dont the economy rolls over.The US Fed will focus everyone’s minds though once it starts to dawn that they have tightened the US into a recession. All coming along nice now. I’m sure houses have topped in the UK as well as the housing market has been sliding for months.

They might take a while to show up in the figures,but the secular top is probably in and will stand for a couple of decades inflation adjusted. Anyone who bought earlier this year and had a first child,that child will be off to uni before they break even again. A long distribution cycle lies ahead for houses,bonds and “growth” shares.

This great disinflation cycle is ending. It started in ’82 and it’s coming to an end. BANG!

[TravisParticipant 84]

Conceivable but unlikely.

Best advice my dad gave me, "Don't get married. Don't have kids."

[IRuleMeParticipant]

Wallstreet will crash again, and just as they’ve done time and time again, they’ll turn to the government for the fix.

[Author]

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