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Remember risk reward. Stocks are not that cheap yet. Interest rate is sky high and impending crisis.....
Use common sense
1. No big rally is coming soon...limited upside.
2. Downside on the other hand can be large...either recession or debt crisis or.both
Why take risk for so.little reward?
I, being poor, have only my dreams; I have spread my dreams under your feet; Tread softly because you tread on my dreams.
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(This post was last modified: 21-03-2023, 08:55 AM by
sgbuffett.)
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(21-03-2023, 08:45 AM)sgbuffett Wrote: 10 days ago everything also safe. We never heard of signature bank or SVB.
Once you see a white ant it means the house wooden structure is already rotten.
Of course optimistic investors are in constant denial and brain is receptive to only good news. ...that's why every crisis kills many investors.
So have you converted all your stock holdings into cash?
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Calmly and logical look at this to see the problem..
1. Global Debt grew to 300T as of today
2. Interest rate pushed up from 0% to 4.75.
3. The extra cost of debt servicing rises by 15T.
4. Where is thus money coming from given economy remains weak.
This debt servicing debt will cause a wave of defaults and stress in financial.system.
Why nothing much as happened yet?
That is because most indebted companies have not yet rolled over their debts. Similarly families are still on low rate mortgages until they expire soon.
Do not ever take signals from the stock market during crisis. Stock markets are often optimistic and like to declare problems over prematurely. This draws in investors who have the bad habit of "bargain hunting"...only to lose big when crisis become full blown.
I, being poor, have only my dreams; I have spread my dreams under your feet; Tread softly because you tread on my dreams.
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Fed aggressive rate hikes always results in recession or crisis.
Fed aggressive rate cuts always results in bubbles ...
I, being poor, have only my dreams; I have spread my dreams under your feet; Tread softly because you tread on my dreams.
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Already huffing and puffing 20years ago about debt but so what , no big deal today chugging along. So it establishes crisis is no crisis and debt is no debt.
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GFC 2008 vs current banking crisis
I, being poor, have only my dreams; I have spread my dreams under your feet; Tread softly because you tread on my dreams.
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