Message from @Zyzz
Discord ID: 405768716719226890
@Zyzz nice job, I agree have to take some profits along the way. at the same time I'm trying to not sleep on the wayside while things go up, so I'm using options to rigidly define my p/l scenarios. But I don't want to be waiting years for an eventual crash before making bullish trades. Trying to tread carefully
@here I try to give a warning a week about risk in investing, instead this week I give you this video. https://www.youtube.com/watch?v=E1xqSZy9_4I
It's a guy who's job is to read market quotes as his normal day jobs, and he's reading the quotes out during the Flash Crash of May 6 2010
@ThisIsChris sheeit
@John O - yeah, that was crazy. anyone who didn't panic sell turned out fine though, the market recovered in a few minutes, it was basically attributed to algorithmic trade machines going into a negative feedback loop and causing each other to go down
That's one of the most frightening things, to realize how fragile everything is. My cousin was telling me about cyber security a few months ago, and I almost shit myself. This is another great example of no matter what you do, a huge portion of your fate is out of your control
@John O - omg so true, I interviewed at a cybersecurity firm once and they said all the computer exploits outthere are like a giant iceberg and the entire cybersecurity industry is just frantically trying to get visible peak above water and doesn't have the resources for everything below
There's some service (governmental I think) that whites reports on all exploits found and that company's whole job was trying to sift through to inform sysadmins which ones they were most at risk of
@here This should be really easy idk why I'm being so slow atm: What is the cash flow of a 15-year bond that pays coupon interest semiannually with coupon
rate 7.5% and par value $100,000?
I'm assuming I just calculate the cash flow for all 30 payment periods? I missed class the day this was discussed.
nvm
@ThisIsChris Thanks for the heads-up! I'm going to take a look. I'll let you know if I decide to piggyback it
@Deleted User Yeah I am curious what you think!
Wow, that stock has been on a tear the last two weeks.
I would have jumped on it if I had seen it yesterday.
With that huge gain today I think I've missed a lot of the opportunity.
What's surprising is that Intel's stock is basically unchanged from its earlier highs despite the tech-heads freaking out over Spectre and Meltdown
At the same time it's clearly more wind in nvidia's sails.
Yeah it's hard to judge when the NVDA train might stop. I mean, "now" is a valid answer, but earnings report is just 2 weeks away
@ThisIsChris knowing when it’ll stop is a tough game to win. SSO is currently up 1% since I sold half my stake. Of course I would have loved to make that extra money but I had no idea it would continue to go up. At some point you have to look at your current profit, be content with what you made, and sell a portion (or all of it)
@Zyzz yep, good thing to keep in mind. I just heard one of the signals I consider bearish: normies in my office talking about NFLX earnings. Reminds me of sitting on the subway last month and hearing normies talk about Bitcoin.
http://mondoweiss.net/2012/03/wall-street-firm-slammed-the-door-on-young-warren-buffett-for-religious-reasons/ this is an interesting article I'm not sure what to make of yet. It's written by a Jew, talking about bitter Jews controlling Wall Street, and the non-prejudiced non-Jews who eventually warmed some of their hearts.
@here anyone who's been watching the market especially with respect to AMZN and NVDA
@Zyzz remember a few weeks back you said you were trying to identify where an asset bubble might be coming from? I was interested too so I hunted down this information from the Federal Reserve:
Here it shows that the total debt balance is higher than '08's levels, but it's way lower for Mortgages and HE Revolving this time, somewhat lower for credit card debt, but way higher for auto loans and student loans, just as you were saying.
@ThisIsChris nice find! Seems like the auto loan and student loan balances have increased tremendously.
If those asset bubbles were to pop you’d have to have something happen in the economy where a lot of jobs are lost
I don’t think either will lead us into a recession but they will prolong it
I think the read through here is 1) there will be a ripple effect when the auto loan bubble does indeed pop, 2) the popping of the bubble will cause automakers to pull back on production (cutting jobs) and will cause dealerships to cut back on sales/financings (cutting jobs), 3) lenders have court precedent saying they can garnish wages - this will ripple through the rest of economy as it will take away from other spending, 4) negative equity balances on trade-ins are being rolled into the next car loan - this has its own set of problems and issues
We have 3 varibles that impact how much car someone can buy(monthly payment) - 1) term, 2) interest rate, 3) principal. we know interest rates are increasing. if there is any shock to the economy it would be reasonable to assume interest rates on sub prime and near prime auto loans would spike (flight to quality). Principal balance is increasing - 1) used car prices are increasing, 2) negative equity being rolled into next loan. The only relief for borrowers is to extend the term of their loan.
Historically low interest rates forced there by central bank manipulations is creating crazy levels of indebtedness. It will end ugly. Thanks for sharing, this is the first I've seen data on the equity of trade-ins and I'm not surprised at all.
Good stuff.
@Zyzz Is there anything to stop lenders from extending the terms of the borrowers loans indefinitely?
Are 7 year car loans a thing yet?