Stock Market Tanking Globally

eleos1954 · Aug 5, 2024

Do you think this is a market correction or are we going into a recession/depression ??

Global stock markets are sliding as Japan suffers biggest fall since 1987

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Paulos23 · Aug 5, 2024

It is just an overreaction to low-earning reports. Not everything is where stockholders want it so they are selling, which happens now and then. It's a great time to pick up some stocks.

Remember, the stock market is NOT the economy. It is a representation of how stockholders and investors feel about companies that they hold stock in. Just because they are selling them off does not mean we are heading to another recession/depression. There are other economic factors that are doing fine.

The IbanezerScrooge · Aug 5, 2024

"Bidenomics strikes... JAPAN!!"

I do think it's curious... I mean economists have been saying for a little bit that things were indicating a recession and then saw yesterday some authoritative report that said it's imminent and then BOOM the next day it starts. But it's kind of a self-fulfilling prophecy, right? Investors see this report the the markets are going to tank, they start selling off everything to cut losses, which causes the markets to tank.

Hans Blaster · Aug 5, 2024

The IbanezerScrooge said:
"Bidenomics strikes... JAPAN!!"

I do think it's curious... I mean economists have been saying for a little bit that things were indicating a recession and then saw yesterday some authoritative report that said it's imminent and then BOOM the next day it starts. But it's kind of a self-fulfilling prophecy, right? Investors see this report the the markets are going to tank, they start selling off everything to cut losses, which causes the markets to tank.

Stock traders are some of the most emotional people I know of, and yet they claim everything is "rational". SMH.

seeking.IAM · Aug 5, 2024

I reckon it depends on how you look at it. I prefer thinking they are running a sale on stocks! If you believe in buying the dips, today may be as good as any.

civilwarbuff · Aug 5, 2024

seeking.IAM said:
I reckon it depends on how you look at it. I prefer thinking they are running a sale on stocks! If you believe in buying the dips, today may be as good as any.

Seems a little early to jump on the merry-go-round. If we are entering a recession then the market has a ways to go down (and maybe stay down for an extended period). Not sure what the number they will use for bear market but I won't be surprised to hear that mentioned over the next few weeks. That would be a decline of 20% or more for at least a few months.

What Is A Bear Market?

The Dow Jones Industrial Average officially fell into what investment professionals call a bear market in September 2022. That means that the DJIA declined by at least 20% from its most recent high. If you’re new to markets, big bear market declines can seem scary. That’s why it’s important to un

www.forbes.com

seeking.IAM · Aug 5, 2024

civilwarbuff said:
Seems a little early to jump on the merry-go-round.

Time will tell. If there is a rebound, swing traders who pick the right companies may benefit nicely. Otherwise, invest for the long haul. But, it is not a time to lock in your losses, in my opinion.

RestoreTheJoy · Aug 5, 2024

W

Paulos23 said:
It is just an overreaction to low-earning reports. Not everything is where stockholders want it so they are selling, which happens now and then. It's a great time to pick up some stocks.

Remember, the stock market is NOT the economy. It is a representation of how stockholders and investors feel about companies that they hold stock in. Just because they are selling them off does not mean we are heading to another recession/depression. There are other economic factors that are doing fine.

Well, except when the stock market WAS the economy in the last 3 years, as Biden/Harris constantly said, under crushing inflation, that at least our 401Ks are doing great.

By the way, top economic adviser left Biden today and joined the Harris campaign. So expect more of the same. MSN

Paulos23 · Aug 5, 2024

RestoreTheJoy said:
W

Well, except when the stock market WAS the economy in the last 3 years, as Biden/Harris constantly said, under crushing inflation, that at least our 401Ks are doing great.

By the way, top economic adviser left Biden today and joined the Harris campaign. So expect more of the same. MSN

Trump said it as well, so I don't expect anything different. The key is it is not a driver of the economy, it is a way to look at it and make bets. But people are bad at looking at patterns and figuring out good odds in a dynamic system like the US economy (or the world economy for that matter). People get confused when the stock market is doing well they assume the economy is doing well, but the stock market could be doing well because the companies are squeezing the little guys for all the money they can. Not a sustainable economy in my book.

JosephZ · Aug 5, 2024

The Nikkei is up 3000 pts in early trading and US futures are all up at the moment. Maybe we will see stocks turnaround tomorrow.

civilwarbuff · Aug 5, 2024

JosephZ said:
The Nikkei is up 3000 pts in early trading and US futures are all up at the moment. Maybe we will see stocks turnaround tomorrow.

Wouldn't hold my breath; that can turn around in a matter of minutes.....

Nithavela · Aug 5, 2024

civilwarbuff said:
Wouldn't hold my breath; that can turn around in a matter of minutes.....

I think it's called a "dead cat bounce".

iluvatar5150 · Aug 5, 2024

eleos1954 said:
Do you think this is a market correction or are we going into a recession/depression ??

Global stock markets are sliding as Japan suffers biggest fall since 1987

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My (potentially flawed) understanding is that Japan has had extremely low (i.e. 0% or negative) interest rates for a long time, which prompted investors to borrow Yen, which they converted to dollars they then used to buy American securities. When Japan raised their interest rates, something about the strengthening of the Yen screwed with the risk level of these investments and triggered a big selloff.

Hans Blaster · Aug 5, 2024

iluvatar5150 said:
My (potentially flawed) understanding is that Japan has had extremely low (i.e. 0% or negative) interest rates for a long time, which prompted investors to borrow Yen, which they converted to dollars they then used to buy American securities. When Japan raised their interest rates, something about the strengthening of the Yen screwed with the risk level of these investments and triggered a big selloff.

You mean leveraged positions caught out in bad position cause havoc. That. Never. Happens. (No wait, it happens all the time. cf. the great recession)

timewerx · Aug 6, 2024

Looming recession, depression, + threat of regional conflict in the whole Middle East and Europe, posturing between China, Japan, etc.

That's exactly how things looked like shortly before WW2.

RoBo1988 · Aug 6, 2024

Paulos23 said:
Remember, the stock market is NOT the economy.

Funny; when anyone mentions any trouble on "main Street" - businesses closing, jobs lost; a supporter of the party in power will be quick point to how great the stock market is doing.

KCfromNC · Aug 6, 2024

timewerx said:
Looming recession, depression, + threat of regional conflict in the whole Middle East and Europe, posturing between China, Japan, etc.

That's exactly how things looked like shortly before WW2.

And for most years since then. I'm reminded of the quote "economists predicted 9 of the last 5 recessions".

Richard T · Aug 6, 2024

This weeks sell off was the warning shot. here are just a few things to consider.

The dollar declined from 160 to 145 yen because Japan finally had the courage to raise interest rates to .25% Ilavatar is right, this small hike set things in motion with the Yen and the Nikkei. Later, we likely will hear about the monster player(s) that got caught on the wrong side of the trade. Fundamentally though everything points to a correction and if war deepens, look out.
Warren Buffet should not fool you with buying and holding. He sold half his Apple stake last month and his company is sitting on 250 billion plus in cash.
Everyone too expects rate cuts now, but what if inflation reaccelerates? Stagflation anyone? Sure seems possible. War too would contribute to inflation as well.
In 1929, inequality was at an all time high, we are near that again.
Look at the Sahm's rule too. What Is The 'Sahm Rule' Behind The Market Panic? There is alot of hot momentum money in the markets and when things start looking bad these folks are going to pull their funds.
The reasons listed here are numerous but deep corrections and rallies do not always make sense. May God lead everyone with their investments and planning.

Hans Blaster · Aug 6, 2024

timewerx said:
Looming recession, depression, + threat of regional conflict in the whole Middle East and Europe, posturing between China, Japan, etc.

That's exactly how things looked like shortly before WW2.

Your historical references are just all off.

If we use the traditional date of Sept 1939 for the start of WW2...

China and Japan weren't posturing. They were already at war for several years and Japan had invaded China.

The Middle East wasn't the global trigger point it is today or would be after WW2. The oil fields of Arabia and Mesopotamia were mostly undeveloped. It was a backwater of minor interest to the global powers. The regional colonial powers were allies.

The economies were recovering at the start of WW2 with the major down turn being years behind them. The stock market crash (see title of thread) that broke the economy was 10 years before the start of WW2.

The one place where it sort of resembles then currently is war in Europe, but at the start of WW2, the echos of the previous war had died down from nearly two decades in Europe and the main threat was a belligerent nation (Germany), whereas to day that belligerent nation is Russia and they have already started their pathetic war of conquest.

timewerx · Aug 6, 2024

Richard T said:
Warren Buffet should not fool you with buying and holding. He sold half his Apple stake last month and his company is sitting on 250 billion plus in cash.

Big names like Warren Buffet isn't always giving you genuine forecasts. A person with such tremendous influence and wealth can easily manipulate stock prices.

If I make a forecast that in 7 days, we'll see an average 5% decline in value and the markets did dip an average of roughly 5% after 7 days, then my forecast would have been accurate.

Now if Warren Buffet had the same forecast and spread the information all over the internet and with many financial articles over-sensationalizing his prediction, and Warren actually selling his stock, we might see a 20% decline instead of 5% if he kept quiet about it.

They time their announcement when the market might turn around for the worse - to amplify the dip so they can buy back their stocks for really cheap.

Warren Buffet can keep "mum" about things but he'll make a lot more money if he opened his mouth.

It may sound like he's doing everyone a favor but only among experienced traders. The additional volatility it causes on the other hand won't be good for the weakest and most vulnerable in our society.

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