How are we in a recession? Real GDP growth YoY has been positive each of the last 12 quarters. Serious question. I don't understand macro economics very well.
---The advance GDP growth reading for the fourth quarter suggested the economy contracted at a rate of 0.1% during the fourth quarter when an increase of 1.0% had been expected among economists polled by --- http://finance.yahoo.com/marketupdate/update oh..i forgot..it will be "revised"..wait and see the effect of tax increase i care less about all this crap. seriously..but some volume and volatility would be nice. gaps would be nice..regardless to their direction..but every day-flat open,flat close 0.5% range..
like i said above- i care less about it. but when "they" expect +1% and got -0.1%-it's kind of surprise ,isn't? what i do expect is some sort of reaction. either way up or down,.i don't care which way. you can't make money of flat market(unless you writing options(which i don't)). but even writing option at current volatility levels is imo suicidal. i'm wrong?
Europe is also contracting at 0.2%. Mortgage applications are down (today's news) Mortgage interest rate is highest since last september (today's news) Semiconductor stocks are warning(LLTC, INTC, ALTR, TXN,...) I believe we have good evidence that the road ahead is bumpy and too much optimisem market reaction is not justified. At least taking profit and staying in cash makes more sense. I believe we will see a day that YTD gain will be zero (about 6% drop from where we are). It will happen soon. If you sell now and enter at that time, you will be way ahead of the market.
I'm always curious when people say "we are in a recession" when few others are saying it. I get the sense people throw that term around more than they should. But like I said earlier, I don't understand macro economics and so maybe we are always on the brink of a recession. What the market is pricing and the mood of the market is a different conversation. I agree on the optimism. But it can last for months and many more percent. I think we'll have a 10% gap down in the market this year. I don't know when and I don't know from what level. I'm flat delta, short a small amount of vol and looking for purely idiosyncratic trades.
Of course it doesn't. The old rule of thumb is 2-quarters. NBER definition is "a recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales". In anycase, if that Bob guy believes this will 'magically' be revised up to avoid hitting the recession trigger, why not just fudge the numbers now?
I remember 2000 it was manic you literally felt like the Internet would change the world old brick and mortar stocks where done, prices would go to infinity. Now its its like gritting your teeth, as the market grinds higher on "rotation" etc etc this will end badly, the treasury market wont crash and if you buy equities at these levels you will make no return in ten years. Then if you have cash you will also flat line. So sell options free money until something crushes your position. So buy gold, why because it will go parabolic, is it in a bubble of course it is, will it get worse of course it will when the market touches or goes over its high and then collapses in a heap.