"The Stock Market Discussion thread "Post all your thoughts on this recent volitality"

umcsom said:
really... do you know anything at all? Gold was a fixed price by the government until 1973. Now go and pick a free market number please.It's a shame that you insist on carrying on a conversation about inflation, by using a link that says "adjusted for today's dollars".

Sustainable economic growth requires a strong currency and low inflationary expectations. The USA has done without for quite some time. Nobody can say they haven't been warned. The one market the Fed is helpless to manipulate speaks the truth.

HumDoHamaraDo said: Money in Money Market Funds, $3.1 TrillionYup... and when all that money realizes the gig is up

It's amusing that all the baby boomer 401k and mutual fund investors are foolish enough to believe that Wall St. is going to let them live lives of leisure on the golf courses in Florida

My generation, ahead of the baby boomers, are the only ones who reaped the rewards of inflation in our retirement investments. We cheated the economic hangman.

The baby boomers are going to lose it all, and wonder what happend.

umcsom said: ifyouhavetoask said: umcsom said:
really... do you know anything at all? Gold was a fixed price by the government until 1973. Now go and pick a free market number please.It's a shame that you insist on carrying on a conversation about inflation, by using a link that says "adjusted for today's dollars".

which one? I already had fixed the gas one by the time you wrote this post. Which other one is like that? and now you show me some data that states you are right and I am wrong. And make sure you understand why the price of gold was so low in 1970. here is a primer.

Now please show me DATA that I am wrong.from your Gas link:

"Historical Yearly Average California Gasoline
Prices per Gallon 1970 to 2007
Based on 2007 Dollars, Adjusted for Inflation"

ifyouhavetoask said: I think you're missing the point. I was a grown adult in 1972, when Nixon took the dollar away from gold. He did it because the rest of the world would no longer fund our nation's problems in Vietman. Sound familiar? The Iraq/Iran thingy is going to decimate your buying power. Sure, you might see the S&P go to 5,000, but it will mean $3,000 gold.

The dollar used to be worth gold, and that's why inflation was kept in check from the end of WW2 until 1972. After that, it's been an orgy of printing Monopoly money. Your dollar has lost most of its value since then, and it's about to lose a heck of a lot more.

I am NOT missing the point. I am disagreeing with you. That does not make me wrong and I am not missing the point. You spout crap after crap. You make stuff up all the time, then you predict the future. I want you to stand behind something you say. You said prove that you are wrong and I did multiple times. However, you can provide no support for your arguments. You just jump from one idea to the next without providing any support or data. You are no better than a Tarot card reader.

You have now been called out. Provide data that commodities that were not price fixed by the US government increased in value more than the S&P 500 did in the same amount of time when dividends were reinvested. Prove to me that you have not been lying and making stuff up for the past several posts. PROVE IT TO ME!!!!

let me guess. You will now go on another rant that means absolutely nothing and tell us how we are all going to be luck to be eating cat food when we get old.

umcsom said: Provide data that commodities that were not price fixed by the US government increased in value more than the S&P 500 did in the same amount of time when dividends were reinvested. Prove to me that you have not been lying and making stuff up for the past several posts. PROVE IT TO ME!!!!

let me guess. You will now go on another rant that means absolutely nothing and tell us how we are all going to be luck to be eating cat food when we get old.Oil was not fixed by the government in 1970, correct?

Oil in 1970 $3.39

Oil today = $128.

3,500% increase.

Would you like more examples?

ifyouhavetoask said: umcsom said: Provide data that commodities that were not price fixed by the US government increased in value more than the S&P 500 did in the same amount of time when dividends were reinvested. Prove to me that you have not been lying and making stuff up for the past several posts. PROVE IT TO ME!!!!

let me guess. You will now go on another rant that means absolutely nothing and tell us how we are all going to be luck to be eating cat food when we get old.Oil was not fixed by the government in 1970, correct?

Oil in 1970 $3.39

Oil today = $128.

3,500% increase.

Would you like more examples?Yes, and this time can we have more examples without cherry-picking the date ranges? Shesssh.

ifyouhavetoask said: umcsom said: Provide data that commodities that were not price fixed by the US government increased in value more than the S&P 500 did in the same amount of time when dividends were reinvested. Prove to me that you have not been lying and making stuff up for the past several posts. PROVE IT TO ME!!!!

let me guess. You will now go on another rant that means absolutely nothing and tell us how we are all going to be luck to be eating cat food when we get old.Oil was not fixed by the government in 1970, correct?

Oil in 1970 $3.39

Oil today = $128.

3,500% increase.

Would you like more examples?

OK good start. Now the question is why has it gone up so much. The numbers would be completely different if you chose 1974. The reason why is because that is when OPEC took control of crude oil pricing. Information here, again like gold there was a fundamental shift in the early 1970's on how crude was priced.

ifyouhavetoask said: umcsom said:
Just admit you have no idea what you are talking about. Either that or the misspelling of "nominal" through you off.It's not a question of me knowing or not knowing what I'm talking about. You're arguing with me about how quickly the building is collpsing, instead of focusing on the fact that it's going to land on your head.

Gold and oil and a host of other things have beaten the S&P since the early 70's. I've shown you that.

For the sake of argument, let's say I was 100% wrong, and the S&P had beaten gold and oil by 300% over those 35 years. Would that actually made you feel better? In other words, if the vast majority of your asset appreciation comes from inflation, what have you really gained?

That's the lesson the baby boomers are learning right now. As the dollar continues to erode, oil contines the march to $200, and the depression takes hold, the 401K and mutual fund holders are going to find out that they not only didn't make a dime, but their seed pile is rotten.

I was laughed off this forum 1.5 years ago, when I wrote that the dollar would collapse, Countrywide and Bear Stearns would go bankrupt, Citi was insolvent, etc. You, like others here, get caught up in the small details (YOU'RE SOOOO WRONG! BEAR STEARNS DIDN'T FILE BANKRUPTCY!). I'm sure that makes the stock holders at CFC, BSC and C feel better

It doesn't really matter if you like the directions I give... they might take you on a roundabout path, but they will get you there

Look for another 20-30% drop in the dollar over the next year, accompanied by a wave of big bank failures. By then, you'll wish the S&P was only being beaten by oil at the rate of 2,000%

....Maybe I'm too late to the conversation...

So equity appreciation was mostly inflation.
Investing in gold and oil is basically profiting off inflation.
Bonds will get killed in inflationary environment.

What should I invest in....gunpowder?

It's always entertaining to see people base arguments on PRICES as opposed to VALUES.

Care to explain how investing in gold/oil (raw material) and let it sit there is going to outpace investing in a "thingamajig" that takes raw materials, add value, sell it at a certain margin for effective price of (price of raw material) + (margin)....

Maybe i'm missing "something..."

agentpt5 said: puckah18 said:

Care to explain how investing in gold/oil (raw material) and let it sit there is going to outpace investing in a "thingamajig" that takes raw materials, add value, sell it at a certain margin for effective price of (price of raw material) + (margin)....


because most consumer products such as IPODS are nothing but inferior junks marketed to ignorant people with no taste. Just look at the 30 dinosaurs making up the DOW30 and tell me which one of them are not middle-age has-been that should be dead long ago.

....which wouldn't that make these companies EVEN more attractive to invest? Take raw material, turn them into junk that sells VERY WELL to ignorant people = (price of raw materials) + (even more margins)....

I'll lay it out plainly. I'm pro equity/stocks/companies until the aforementioned companies deliver NEGATIVE margins.

Care to explain how gold isn't based on the "next fool" fallacy?

If you want to make a TRUE argument, please stick to your thesis (I think it was something like gold will be a better investment because of inflation). Your last argument can very well be applied to gold as well. How is gold not dependent of the "next sucker?"

and I still don't understand how "high margin" wouldn't beat inflation. There is something fundamentally wrong either with my statement or your statement..

Inflation = rising prices for goods and services.
A company takes in raw goods/raw labor, adds value, then sell that particular good at a marginally higher rate....

Thus:

(raw material base cost) + (inflation effects) + (margins) = corporate profit

Now if I am to assume that margins are positive, corporate profit will ALWAYS outpace your golden bullet (inflation).

margins will be squeezed or become negative?? Even if margins become 0.00000000000001, it will still outpace inflation.

gold has been valued for 5000 years, but the bartering power has fluctuated. You happened to caught it at the right wave. If you want to use this argument, how about Jade, Ivory, Diamonds, and etc? How about something even more precious like LAND? We're finding gold mines every year, thus increasing supply, but unless Earth has been expanding, land is FINITE. If anything land has been chased after for as long as there was living organisms. Wouldn't land be a even better proxy? Why gold? Oh yea, cherry picking.

In my opinion, you simply picked the very well performing item in an asset class (raw material) that outperformed another asset class (equity) in the time period. Kudo's to you. But if I simply picked 1 outperforming STOCK and compared it to the whole basket of raw materials, your inflation argument would be a joke.

Perhaps you want another illustration...Let's take your precious gold that you love so much. When you paid $380 for your gold and it shot up to $1000, I'd rather own a company that owns the gold mine. For every $380 gold you bought from me, it probably only cost me $250 to mine and process. Sure you think you're brilliant, since your gold ingot shot up to $1000. But as the owner of the mine, I can still produce the same ingot for $250 + some inflationary labor cost and sell it for $1000.....

Regardless, corporations will be more profitable than simply owning gold.

puckah18 said:

Perhaps you want another illustration...Let's take your precious gold that you love so much. When you paid $380 for your gold and it shot up to $1000, I'd rather own a company that owns the gold mine. For every $380 gold you bought from me, it probably only cost me $250 to mine and process. Sure you think you're brilliant, since your gold ingot shot up to $1000. But as the owner of the mine, I can still produce the same ingot for $250 + some inflationary labor cost and sell it for $1000.....

Regardless, corporations will be more profitable than simply owning gold.

You are hair splitting here. I consider all gold and gold related investments such as gold stocks as one for the discussion here.

Using your logic in a prior post, shouldn't companies mining worthless gold be worthless too?

puckah18 said: agentpt5 said: puckah18 said: margins will be squeezed or become negative?? Even if margins become 0.00000000000001, it will still outpace inflation.

I see that you are one of those "there is no inflation" kool-aid drinker.

I'll be nice and let this insult slide. Read my previous post.

Profit = margins + Inflation + base material cost. As long as margins are positive profit will outpace your inflationary returns. I don't care about inflation, as long as the company that operates can continue to charge Raw Materials + Inflation cost + margin.

During the past several years, manufacturers have been absorbing raw material costs, as they are unable to pass on price hikes to customers.

puckah18 said: As long as there is positive margins, investing in companies WILL OUTPACE INFLATION.

Only if you pick the right companies. Pretty much every companies listed in the Dow 30 in the 1920s were bankrupted. The long term return of an individual company is close to zero. If you want to spread your bet and use the market average, the long term return of new companies minus bankrupted companies is no better than the rate of inflation.

puckah18 said:

Exactly! Just like you picked gold to invest out of a basket of raw materials. If you simply picked the basket of raw materials vs picked a basket of US stocks, then we'll be in a TOTALLY different argument.

your position: precious metals, my position: stock


All raw materials - copper, uranium, platinum, gold, silver, oil, gas have risen against the depreciating dollar. And I have stocks in gold and silver. I am not against stock. Just those useless companies selling worthless junks.



You win in the argument of "gold appreciated at a higher pace over the last 10 years compared to US stock indice"

I win in the argument of "CocaCola stock has beaten a basket of precious metals over the last 100 yrs."



I know this for sure -- my birthday is not 1908. Who want to own CocaCola, nothing but water and sugar. It is a has been anyway. It is irrelevant if my or your "argument" win. There is a time and place for everything. Now is not the time for useless companies selling worthless gadgets.



Anyone can cherry pick. And also, you're wrong with your "long term return" statement. If you want to make a blanket statement, make sure you back it up. Stock indices may have survivor bias, but to incorporate all that succeeded and failed all you ahve to use is GDP. As far as I see, IN THE LONG RUN, GDP has outpaced inflation which indicate that companies as a whole DO GENERATE POSITIVE RETURN over inflation hedges.



I know this is my "long term return" -- 100% in tech stocks prior to 1998. 100% in dot com stocks from 1998 - 2000/2001. 100% cash from 2001 to 2003. 100% in gold, silver, oil, gas since 2003. Added credit cards (mastercard, visa) in the last couple years.

I don't think that you did better.


Oh, and about the kool-aid drinking. I wonder whether I should drink the koolaid of numerous scholars, nobel prize winners, researchers.....or agentpt5.......

Who cares what or who you pick as shepard? In fact, I encourage right wingers to do the opposite of what I do. Some are so ignorant and arrogant that they will jump off a cliff before admitting errors.

magika said: Woah, the doom and gloomers* are out in full force today. Here is what I don't understand: if the end is truly nigh and the great depression is about to send us all into soup lines, why are you on here telling us about it? Isn't it better for you guys to go buy your precious metals and oil stocks in order to profit all of us dumb sheep who don't understand the sky is falling?

Nah. I think being a doom and gloom prophet is just sexier.

*There is a difference between being a doom and gloomer and simply thinking the economy is in a bad position. There are several posters here who are true "the end is coming" doom and gloomers, and it is to those people who I am referring to - not the permabears.

We have already purchased our precious metal and oil. We are just sitting on our ass collecting the rewards of our "hard work" and "success" from hitting a few mouse clicks.

Shouldn't you celebrate my "hard work" and "success"? In fact, shouldn't you propose special tax cuts for my "hard work" and "success"?

magika said: agentpt5 said:
We have already purchased our precious metal and oil. We are just sitting on our ass collecting the rewards of our "hard work" and "success" from hitting a few mouse clicks.

Shouldn't you celebrate my "hard work" and "success"? In fact, shouldn't you propose special tax cuts for my "hard work" and "success"?
I highly doubt you believe your own statements about your own success.

Duh! But you do. Rich = "hard work" = "success" = tax cuts

agentpt5 said:
Duh! But you do. Rich = "hard work" = "success" = tax cuts

Mmm. That radical populist kool-aid, it must taste good. Drink up, be bitter!

agentpt5 said:
Even though I like bitter beer, why do you think that I am bitter? I am having a good time laughing at losers applying your logic. Maybe you are just jealous that I am hitting home runs, while you don't even know how to get a base hit.

I am sad for you. Your arrogance has no bounds, and your hatred for everyone who doesn't agree with you shows your maturity level. Don't laugh too loud though, those men in white coats might come give you your medicine again, and then you won't be able to entertain us until the sedatives wear off.

OK, I'm done messing with you - it was a good laugh, I love watching nutty people like you preach endless doom and gloom on the internets. Have fun, get the last word for me!