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Is inflation looming?

Old 08-13-2021, 08:48 AM
  #21  
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Originally Posted by TransWorld View Post
That is not the case with my financial management firm. They consistently rank in the top 1 or 2% of rate of returns over most years and averaged over a long period of time. They have a track record decades long.

Most financial investment firms do worse than the market averages. They are one of the few who do better. It is not just selling the losers to make the portfolio look better. It is not flash in the pan with one year good and the next year bad. It is not smoke and mirrors. They actually have a better rate of return, consistently.
Yep. And anyone in the right side of the bell shaped curve STAYS in the right side of the bell shaped curve…right up until they don’t. You can do it with coin flips. If you do enough of them, the win-loss distribution of a binomial approximates a Gaussian distribution




a certain small percentage will - by random chance - give you 40 ‘heads’ in a row, even with an honest coin.

That has no bearing whatsoever on the results of the next toss, although over time the central limit theorem implies that the expectation (50-50) is pretty much where you will end up with enough flips.
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Old 08-13-2021, 10:13 AM
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Originally Posted by Excargodog View Post
Yep. And anyone in the right side of the bell shaped curve STAYS in the right side of the bell shaped curve…right up until they don’t. You can do it with coin flips. If you do enough of them, the win-loss distribution of a binomial approximates a Gaussian distribution




a certain small percentage will - by random chance - give you 40 ‘heads’ in a row, even with an honest coin.

That has no bearing whatsoever on the results of the next toss, although over time the central limit theorem implies that the expectation (50-50) is pretty much where you will end up with enough flips.
You are entitled to your opinion. What you do not consider is a team that sees the horizon and understands it differently and more correctly than the average coin flip. Most investment managers do not. Only a few percent do. They have proven that in over 40 years. It is not just a bunch of lucky coin flips.

As an example, March-April 2020 the S&P 500 dropped 34.5%. It was a rapid, sudden drop due to COVID-19 panic. Most investment people use the rule 10 - 20% being a correction and anything more is a bear market. They then called for investing in Value stocks, which lead after a bear market. In a bear market, Value stocks get unusually beaten up. So, in the recovery of a new bull market they lead the rise in stocks.

But, there were no excesses which classically are root causes of bear markets. Bear markets (with only The Great Depression in history as an exception) do a slow rolling drop at the top. Corrections are sudden and rapid. They correctly called this a correction, not a bear. Recovery was at a rate typically seen in a correction, much more rapid than a bear.

They said this was a continuation of a late stage bull market. Late stage bull markets have Large Growth stocks lead the market (think Apple, Alphabet (Google), Amazon). They did not shift my portfolio from Growth to Value. The first few months, Value did predominate, because many investment managers loaded up. Then the Value rally fizzled. By later in the year and this year Growth has outperformed. This proved there understanding was correct, and most investment firms had called it wrong. My portfolio beat the market averages and most other investment managers over the entire year of 2020 and are beating them in 2021. (My portfolio is the total number of dollars I have them invest. It is not what stock is hot in their portfolio, trading away under forming stocks at the end of the quarter - often referred to as ‘window dressing’.)

I could go through a number of other examples. They are correct in their predictions 70% of the time. They have enough counter investments so if they are wrong, my portfolio does not get beaten down too badly. But, taken as a whole, they outperform the markets and most other investment managers. Facts and their explanations (which one can look back on to check their accuracy) show this to have a high accuracy.
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Old 08-13-2021, 10:58 AM
  #23  
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I won’t deny that there are some people who shouldn’t be in the market at all or who without someone to steady them will jump on the biggest bubble just before it bursts or dump a sound investment just before it rebounds. But that’s an emotional response. And some financial advisors will have lucky guesses and beat the market in the short term. But the overwhelming majority of financial advisors will not beat the S&P 500.





And if you look at your financial advisors paperwork, they will ALWAYS tell you that past results are no guarantee of future results. That disclaimer is there for a reason.

But it’s your money…

Last edited by Excargodog; 08-13-2021 at 11:34 AM.
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Old 08-13-2021, 03:15 PM
  #24  
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I took a graduate level statistics course and got an A. So I understand random coin flips with an unweighted coin. I understand a bit about investment management, as I took a graduate course in it and got an A. I have been reading the WSJ for more than 40 years.

I can read and understand financial information, I just do not want to take the time (nor do I have the temperament) to manage my own investments. The firm I am with has hundreds of professionals in their research department. They do more work than I have hours in the day.

You are entitled to your opinion. My information I have shared here is not to convince you. It is to share insight for others to improve their understanding.

There are no risk free decisions to decide to put your money. That is why the federal law requires every investment manager to put that disclaimer in. There is a risk in loss of your money in stocks, in bonds, in mutual funds. There is a high probability of gains.

There is an almost certainty of loss doing what my grandmother did, putting cash under her unmentionables in her chest of draws. It is called inflation.

I have spoken factual information. Most investment managers do not beat the market averages. There are a few percent that really truly do, over the long haul. Theirs is not random coin flips and chance. Theirs is based on profound research and insights. That is rare. When you find them, take advantage of them. Be cautious there are plenty of “slick used car salesmen” out there. Sort through those to find the few that actually do better than an index fund, over the long haul.
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Old 08-14-2021, 08:09 AM
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Notice that consumer products are now shrinking in size/quantity to offset the inflation.
Compare rolls of TP from a year ago (420 sheets) to now only 380 sheets...
For real! They think we are stupid...
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Old 08-14-2021, 08:21 AM
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Originally Posted by PerfInit View Post
Notice that consumer products are now shrinking in size/quantity to offset the inflation.
Compare rolls of TP from a year ago (420 sheets) to now only 380 sheets...
For real! They think we are stupid...
It's pure marketing...
They will introduce"bigger" later....
Happens every few decades...it's just a cycle....
you get old enough, you can sit back and watch.
Maybe for some might not realize it...but think MOST do...
More to do with supply chain...it's easier to update a size than do price increases...from a marketing perspective, it's "easier to swallow" as people see the basket in of goods not change in price to take home even if they get less.
You print money....things are going too go up in cost!!
Just like increases in minimum wage....
Nothing is free....now more $$$ chasing the same amount of goods/service.
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Old 08-14-2021, 08:42 AM
  #27  
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Originally Posted by PerfInit View Post
Notice that consumer products are now shrinking in size/quantity to offset the inflation.
Compare rolls of TP from a year ago (420 sheets) to now only 380 sheets...
For real! They think we are stupid...
Its for all those halfa**ed political people out there. They do not need as much.
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Old 10-02-2021, 10:30 AM
  #28  
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And green politics is ALSO driving inflation:

https://asiatimes.com/2021/10/green-...stock-markets/









There has been an increase in energy demand due to an unseasonably hot summer and the reopening of airline flights and other forms of transportation, but the spectacular increase in energy prices is the result of constraint on demand.

Virtually the whole of the world’s political elite has signed on to the carbon neutrality agenda, including the government of China, which appears to believe that support for carbon neutrality (which China has pledged by 2060) will mitigate hostility to China in the West.

But the energy market suggests that the hard reality of supply constraints will overwhelm the Green agenda before it gets started.

The energy price shock adds to the inflationary pressures that continue to build in Western economies. Supply constraints in the United States have spilled over to the services sector, as the Philadelphia Federal Reserve’s survey of nonmanufacturing companies indicates
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Old 10-09-2021, 12:35 PM
  #29  
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https://www.msn.com/en-us/money/markets/an-energy-crisis-is-gripping-the-world-with-potentially-grave-consequences/ar-AAPjcIE



An excerpt:

When the coronavirus pandemic first swept the world in early 2020, gas reserves were abundant and the price was at rock bottom. But production of both gas and oil was sharply curtailed as economies shattered, and reserves were eaten up by the unusually cold weather in Europe last winter.

The energy crisis first emerged in China, the world’s manufacturer, as global demand for its products suddenly and unexpectedly shot upward this year. Coal stocks were low, and an unofficial Chinese ban on Australian lignite meant they couldn’t quickly be replenished. Power companies turned to the spot market for liquefied natural gas (LNG) instead, and its price soared.

In Asia, the spot price, measured in a million British thermal units, went from less than $5 in September 2020 to more than $56 this October.

As a result curbs on power consumption have been implemented across two-thirds of China, disrupting factory production and daily life.

Some factories have shut down altogether. China’s power cuts will further disrupt international supply chains already stretched by the pandemic. Factories have had to reduce production at a time when they are usually ramping up for the December holiday season.

In Guangdong, China’s most populous province, authorities have banned the use of elevators in office buildings for the third floor and below, encouraged residents to use natural light as much as possible, and asked for air conditioners to be adjusted to higher temperatures. Beijing and Shanghai canceled annual light shows during the Golden Week holiday that spanned the first week of October.
https://www.reuters.com/business/ene...ch-2021-10-08/

"As other energy prices like natural gas and coal keep pushing higher, upside risks to the oil market have started to build," said Bank of America's Christopher Kuplent.

The price run-up has been spurred by soaring European gas prices, which have encouraged a switch to oil for power generation.

Benchmark European gas prices at the Dutch TTF hub on Friday stood at a crude oil equivalent of about $200 a barrel, based on the relative value of the same quantity of energy from each source, according to Reuters calculations based on Eikon data.

"An acceleration in gas-to-oil switching could boost crude oil demand used to generate power this coming northern hemisphere winter," an ANZ commodities analyst said in a note.
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Old 10-10-2021, 07:39 AM
  #30  
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The 1970s return, this time as farce.
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