Message from @Zyzz

Discord ID: 396077071471738881


2017-12-28 23:03:50 UTC  

I'm back, catching up to the thread...

2017-12-28 23:04:34 UTC  

I agree with @Zyzz The aggregate P/E of the S&P is too high for me to be comfortable making large bets on upwards moves

2017-12-28 23:04:46 UTC  

If I were to do that, I would want to hedge for a big crash

2017-12-28 23:05:01 UTC  

I think it's going to go up 10% on the year or nosedive hard.

2017-12-28 23:05:20 UTC  

but that and $4 will get you a coffee at (((Starbucks)))

2017-12-28 23:05:21 UTC  

@Zyzz here's a question, do you think we could say that even if the market goes up possibily, can we be confident saying it *won't* go up 10%? Maybe selling those OTM calls is a way to go on this

2017-12-28 23:05:30 UTC  

@Deleted User what catalyst do you see for a nose dive?

2017-12-28 23:06:16 UTC  

War is the most obvious thing, but a general bubble-popping correction seems overdue.

2017-12-28 23:06:22 UTC  

Nose dive not sure, but we could get interest rate hikes from the fed

2017-12-28 23:06:42 UTC  

@ThisIsChris i am seeing dec 2018 295 strike calls sell at ~2.6. i dont think thats enough premium for me to hold for a year with unlimited loss potential

2017-12-28 23:07:10 UTC  

I don't see things staying static is all I'm sayin'

2017-12-28 23:07:17 UTC  

@Deleted User war is a possibility with NK no question. What would pop the bubble?

2017-12-28 23:07:38 UTC  

I think a broad-scale pullback on credit

2017-12-28 23:07:40 UTC  

i am expecting rate hikes from the fed.. i think cadence of rate increases is key

2017-12-28 23:07:52 UTC  

too many rate hikes, too quickly will spell disater

2017-12-28 23:07:53 UTC  

IMO the american consumer is tapped out

2017-12-28 23:08:00 UTC  

agreed

2017-12-28 23:08:29 UTC  

The outstanding credit numbers are nuts, both in the consumer and corporate spheres

2017-12-28 23:08:46 UTC  

I think that's what is driving a lot of the increase in stock prices

2017-12-28 23:08:51 UTC  

@Zyzz agreed on the decembers, now I'm looking at chains for more near term (also included on the pdf)

2017-12-28 23:08:52 UTC  

lenders get frightened? i can see that happening. what would cause them to get frightened?

2017-12-28 23:09:06 UTC  

I'm saying that there will be a pull back on people seeking credit

2017-12-28 23:09:10 UTC  

especially if interest rates rise

2017-12-28 23:09:26 UTC  

i 100% agree that consumers are buying on credit rather than actual money they are earning

2017-12-28 23:09:35 UTC  

or rather, I'm saying that pullback would be the catalyst

2017-12-28 23:09:55 UTC  

I guess what always frightens lenders, if people default. @Zyzz you gave a pretty good analysis the other day on default rates for the largest asset classes. I actually wanted to ask where you find that data

2017-12-28 23:10:05 UTC  

gonna be AFK for a bit but I'll rejoin later and jump in if I have anything to say.

2017-12-28 23:10:23 UTC  

Hope you do!

2017-12-28 23:19:08 UTC  

i get a lot of my student loan info from zerohedge

2017-12-28 23:20:06 UTC  

@Zyzz Interesting. If I understand the process your analysis took: 1. You knew that understanding the size and eliinquincy rates of different asset classes was important to know, and then 2. you googled around for articles that talked to each asset class and its delinquincy rates. Is that correct? I'm just trying to understand process, I thought there might just be a single database where you go to get these types of facts, but I also wouldn't be surprised if such a database didn't exist and you just have to know the right question to ask and start googling

2017-12-28 23:20:41 UTC  

And the reason I'm trying to understand process is I'm also trying to learn how to do good research myself of course

2017-12-28 23:20:52 UTC  

Not trying to "question" or something

2017-12-28 23:22:34 UTC  

@ThisIsChris at work we talk about this stuff a lot. that seeking alpha link was something i knew intuitively (subprime auto defaults) but didn't know an actual %. there are a lot of people in SoFl with nicer cars than me and I know damn well they do not make as much money as I do.

2017-12-28 23:23:27 UTC  

student loans I knew about by reading zerohedge. i have also heard anecdotal stories of high debt loads and parent cosigners (you remember cannoliqueen?)

2017-12-28 23:23:58 UTC  

we understand recessions happen every 8 or so years.. the last one was in 2009

2017-12-28 23:24:23 UTC  

we are about due for one. i know the market is frothy and not just the stock market but the RE market as well

2017-12-28 23:24:51 UTC  

its not a question of if but when and what will trigger it

2017-12-28 23:25:20 UTC  

my position is the tax cut will kick out the possibility for a recession a few years. i dont think it'll happen until after trumps reelection

2017-12-28 23:27:59 UTC  

if we look at 2008's recession that was triggered because you had this massive asset class getting bid up in price with easy money (teaser interest rates, very high LTV (loan to value), no doc/no income loans, subprime borrowing, diversity programs for home loans, etc.). and of course you had some predatory practices such as adjustable rate mortgages amongst other things.

2017-12-28 23:29:24 UTC  

the financials crisis could have been avoided if they would have done: 1) require 20% down payment no matter what, 2) require documentation as to the borrower's job and current income. and of course forget about the other social engineering bullshit