Jun 16, 2022 11:30:05 GMT c said:

Rather than make a new thread for it right since, will just toss it here. The recession is here. Spending is starting to drop across the board by consumers. Only a matter of time before we start to hear bailout talk as those CEO bonuses do not pay themselves.

I wish they didn't bail out the GFC just so you would understand that it was the least worse option. If the banks didn't get bailed the US wouldn't be a first world country today.

This recession was inevitable, this is the formula

((GFC + Covid)*QE)^Stupid

I'm currently watching Cramer shilling stocks based on their PE ratios... When earnings are about to be creamed.
Also on the headlines that US new housing constructions already down 14%

Yeah noticed all of the NOW IS A GREAT TIME TO INVEST stuff being slammed out.

Not ever going to support the bailouts. The US taxpayer literally paid for the top execs of companies that needed them to get billions in performance bonuses after the companies told congress without a bailout they would fail. 10% of the government cash that was sent to these companies was spent on executive performance bonuses.

This repeated during COVID except bonuses were paid before they took government cash just in case.

Perhaps we should just let things hit the fan for once.

Last time we did that we got the Great Depression Ness.

Jun 16, 2022 19:55:24 GMT @ness said:

Perhaps we should just let things hit the fan for once.

You are actually correct, the market doesn't make sense because since the GFC it hasn't been a free market.
The Fed deliberately made money cheap and then didn't have the balls to put it back.

It's like you were opening a store and you had no customers, so you started a buy one get three promotion and your store filled up.
Then all the people in the store told you if you stopped the promotion they wouldn't come any more, so you keep giving stuff away and tell everyone your store is a huge success even though you are losing money hand over fist.
This is exactly what the Fed Reserve has been doing, except you can do it with impunity when you are also the guy printing the money.

The amount of money flowing in the economy today means that the value of nothing is real.
This is what the market is slowly realising and it actually follows if you look at the way the markets are deflating, from least to most tangible.
Crypto then Tech then the Broader Market... And none of these are finished deflating and now the contagion spreads into the real world in the way of house prices declining rapidly and consumer sentiment dying in the ass.

There is no such thing as a recession it is just a measure, it just means that people believe that everything is bad and they stop spending.
When they have had enough of believing that, the recession is over.

For those playing at home, the REITs are also getting hammered.

etfdb.com/etfdb-category/real-estate/

Some nasty losses there

BTC broke 20k and trying to get below 19k.

Looking more and more to me like QE skewed all the markets, perhaps crypto never would have been a thing without it.

Jun 16, 2022 13:31:00 GMT iNCY said:

Jun 16, 2022 11:30:05 GMT c said:

Rather than make a new thread for it right since, will just toss it here. The recession is here. Spending is starting to drop across the board by consumers. Only a matter of time before we start to hear bailout talk as those CEO bonuses do not pay themselves.

I wish they didn't bail out the GFC just so you would understand that it was the least worse option. If the banks didn't get bailed the US wouldn't be a first world country today.

This recession was inevitable, this is the formula

((GFC + Covid)*QE)^Stupid

I'm currently watching Cramer shilling stocks based on their PE ratios... When earnings are about to be creamed.
Also on the headlines that US new housing constructions already down 14%

A.) Well that's kinda fucked...
B.) Every left wing nerve in my body winced at the sound of this.
C.) How dare you try to take away one of my most valid criticisms of Obama. Now all I have is Syrian drone strikes and Gingrichcare :lol:

As a result of interest rate hikes, it is expected companies will raise prices again to offset the loss in demand. Also polls are showing Trump will win in 2024, so companies will be aiming for a bailout and a return to 0 interest rates that a Trump win will bring.

After that last devastating spike to interest rates, mass layoffs have started. Gonna have to them lower them to pull this country out of the recession we are in. Strangely the layoffs seem to all relate to people who would benefit the most from a 0 interest rate, like larges investment groups or speculative tech people who buy companies on debt. Media does not care and is worded things as if the great depression is coming back because the feds had the audacity to rise interest rates 1.5 percent.

Speaking of mass layoffs, Musk's layoffs are illegal ones that will cost him millions because he is supposed to give 60 days notice before he lays people off because he has bad vibes about the economy.  

Housing market def is cooling as those are the departments are being dismantled by investment firms.  No more easy money from rental groups taking as many loans as they can get for rent backed securities.

You all know how I love drawing orange lines on graphs, this is the US housing market, the orange line I drew in is an approximate historical average.

The red box is the stupidity that preceded the GFC
Prior to the red box in Q3 2002 the US median house price was 186k and at it's peak reached 257.4k in Q1 2007 which is a 38.4 increase 13% over the base inflation rate of about 25% that the orange line moved in the previous 5 years.

In star contrast the blue box is the lunacy of QE world, the median price is 428.7k which is 52% INCREASE over the historical trend of the orange line.
It's nearly all down to QE and artificially low interest rates. 

Anyone who looks at the data and talks about "Putin's price hikes" is a liar.

It's all musical chairs and the economy can actually handle this unless the music stops, if something happens to contract the labour market and affect peoples ability to repay their mortgages we are in trouble.
And because of the rampant stupidity of the inflation situation we are now in, Uncle Jerome may end up pulling the handbrake exactly that hard.

Nice spot. Notice that nice little dip, then final spike before the crash in your red box. We are so fucked.

US labor market is doing extremely well. We can hit that break hard. As I said in the other thread, many businesses cannot really afford anymore to survive and it is time to rip the bandaid and let them realize it. Want labor costs to drop, we need to reduce the amount of open jobs. US right now has 11.4 million open jobs for 164.6 million workers. We keep creating jobs this ratio gets more extreme and wages will rise. I am all for it, but people more concerned with a traditional economy may want to see workers have less power.

Jun 27, 2022 3:34:30 GMT c said:

Nice spot. Notice that nice little dip, then final spike before the crash in your red box. We are so fucked.

US labor market is doing extremely well. We can hit that break hard. As I said in the other thread, many businesses cannot really afford anymore to survive and it is time to rip the bandaid and let them realize it. Want labor costs to drop, we need to reduce the amount of open jobs. US right now has 11.4 million open jobs for 164.6 million workers. We keep creating jobs this ratio gets more extreme and wages will rise. I am all for it, but people more concerned with a traditional economy may want to see workers have less power.

The frightening part is the return to the mean after the GFC, it's almost a perfect line, this should make us all nervous as it shows the market it able to correct, the difference today is that the correction without a dip was able to happen last time because the Fed basically took all the bad debt. Not sure that can happen again considering that act created the inflation that lead us to where we are today.

The lever of interest rates is unpredictable on how it will affect the market.
With the small adjustments already made the new house construction market has stopped pretty much dead.
I think home ownership is tracking at about 64.8% of US households.
Everything rests on the reports from Companies on their earnings and sales in the next quarter.
The stock market is currently having a mini rally because PE ratios look good, the problem is it is todays price and last years earnings.
The companies that have reported, like Target are sounding the alarm.

I also reject your sentiment on workers power, when you have code monkeys being offered 150k signing bonuses, nothing about that is positive, it is another indicator that inflation is rampant.
Good for that particular worker and terrible for the broader economy.

Return to the mean will only occur when the driver away from the mean is removed. And in home prices it is the economic investment of buying a home you do not plan to live in. Gonna be hard to correct as long as rental is a good investment.

No company needs to hire a programmer for 150k up front. And again, in the US no one is hiring a general programmer with a 150k signing bonus as that is three year salary here. But programmers are limited resource and the scarcity vs demand intercept determines the price of their labor. They are high demand, but not high supply, as they have the math wall to cross. Most hobby programmers can not pass the industry tech interview, and the math wall to formally learn CS turns many college students away from it.  So you cannot expect to hire one of the limited supply of competent programmers for near min wage prices.  And if you want experience in actual industry that is business related, that will really cost you.

The cost my cohort was advised to charge by the firm that was headhunting us was $100 an hour min for statistical programming or consulting.  We were told that was an acceptable rate to charge for junior consultants of our calibre and experience level since we had a very specific multiprone training in assessment, analysis, evaluation and statistical programming.

Jun 27, 2022 5:06:30 GMT c said:

Return to the mean will only occur when the driver away from the mean is removed. And in home prices it is the economic investment of buying a home you do not plan to live in. Gonna be hard to correct as long as rental is a good investment.

No company needs to hire a programmer for 150k up front. And again, in the US no one is hiring a general programmer with a 150k signing bonus as that is three year salary here. But programmers are limited resource and the scarcity vs demand intercept determines the price of their labor. They are high demand, but not high supply, as they have the math wall to cross. Most hobby programmers can not pass the industry tech interview, and the math wall to formally learn CS turns many college students away from it.  So you cannot expect to hire one of the limited supply of competent programmers for near min wage prices.  And if you want experience in actual industry that is business related, that will really cost you.

The cost my cohort was advised to charge by the firm that was headhunting us was $100 an hour min for statistical programming or consulting.  We were told that was an acceptable rate to charge for junior consultants of our calibre and experience level since we had a very specific multiprone training in assessment, analysis, evaluation and statistical programming.

If we don't return somewhere close to the mean then we have sky high inflation for the foreseeable future.
That insane low interest rate and QE money the Fed splashed around like horny drunk sailors on shore leave is going to have to be removed from the market somehow.

The fact that nearly all of those funds ended up sitting in various asset classes leaves no outcomes that don't involve collapsing those prices to a certain degree... That I can see anyway.

Jun 27, 2022 5:06:30 GMT c said:

150k signing bonus as that is three year salary here

Entry level is around $80k/year for programmers for normal companies that aren't trying to get bottom of the barrel prices (adjusting for a "normal" city like Denver). Two or three years and it's $100k. Mid-level experience is $120k. Senior engineers start at $140k and approach $200k. That's just salary, not including bonus, 401k match, equity, benefits, etc.

Jun 27, 2022 5:06:30 GMT c said:

But programmers are limited resource and the scarcity vs demand intercept determines the price of their labor.

There are zillions of programmers, the thing now is that virtually every company needs them in some manner.

Jun 27, 2022 5:06:30 GMT c said:

but not high supply, as they have the math wall to cross

The amount of math in programming is overestimated - you only need basic math unless you're doing some really deep analytical stuff, which the vast majority don't do. Comp sci isn't the only route to programming. Many excellent programmers have non-programming degrees. I have a programming focused degree but it's technically a business degree rather than comp sci.

Jun 27, 2022 5:06:30 GMT c said:

Most hobby programmers can not pass the industry tech interview, and the math wall to formally learn CS turns many college students away from it

The FANG company interviews are generally focused around data structures and algorithms that are learned in comp sci, not math. They are actually easier for recent comp sci grads because they learned about them recently, whereas us old ass programmers who have been working for 20 years have to go back and relearn them for interviews because we haven't had a need to use those data structures and algorithms once in 20 years. Any interview that involves a binary search tree is a red flag for me.

Been a while since I was anywhere near the job market, but either way entry level hires are not getting two years of pay up front. There is a huge difference too in starting pay for where you are working as a programmer. Area I was looking at would have started far higher since we would be programming for analysis. The guys who are programming for websites will be making far, far less.

My friend who does conceptual knowledge measures for programming in signal corps love that binary tree. It is a great way of seeing if people understand programming at a very high level. Searching the tree, traversing the tree and inserting or deleting nodes all involve pretty high level concepts, but can be exampled very simply on a whiteboard with pseudocode and basic equations, while also allowing people to demonstrate what is happening to the tree itself. He finds it works better than a sort or pseudocode problem solving for separating those who understand programming at a high level from those who do not. Not as good as just testing them with the first task they will work on if hired, but that is not entirely ethical.

The math is not intense, but really is gated by algebra. Algebra introduces variables and functions, the backbone of programming. Many students hate algebra so much they want nothing to do with programming when they see linear algebra as a requirement, and you need linear to do a lot of high end programming shit.

Everyone go home, inflation is obviously over... Someone pop the champagne.

And prices are all falling in the US again. Gas so slowly retreating, housing is frozen, grocery prices retreating, etc. Demand collapsed across many industries and price spiking lead to a recession. Companies now retreating pricing to restart sales. Not out of the woods yet, but it was clear that a breaking point was passed and spending reacted.

White House news is good news too as it shows meat prices are slowly retreating from record highs six months ago. Threatening anti-trust lawsuits against the meat industry has them slowly reversing some price increases.  Too little, too late though, Republicans are ready to take action themselves and bills moving through committee that will give the USDA subpoena power to investigate antitrust violations themselves.  

Basically we're still taking it up the pooper but at least now they have the decency to give us a pillow.

Well the meat industry is fucked. Republicans are ready for action and they have no allies with democrats. And lobby cash is not going to save them now, as ranchers are lobbying as well.

Gas industry may try to squeeze the US more but Europe is passing windfall taxes and other countries are likely to do the same. Also they are likely facing demand collapse for the 4th of july weekend, which means lost profits.

Consumer spending on general goods down 25% in one year from Q1 reports. Demand collapse is very, very real.

Bring on the UBI. Of course they're only gonna do that when things gets bad a someone finds their head on a spike.

UBI will not help. The demand collapse curve is steeper than when we hit the great recession. Clearest sign Incy's collapse is happening.

What happens when the share price of tech companies collapse...
Well perhaps they no longer feel the need to keep people on their books who don't do anything

These videos should have been the canary in the coal mine that the market was going to contract in a big way.
I am not a doomsayer, I just reject the "new paradigm" and maintain eventually gravity kicks in, you can't escape fundamentals...




At least this girl will have a power ass for stacking boxes. [/cynical]

We are about halfway through the correction I think

Tech is not what I would use. I would use straight Dow. Tech had a TON of scams that got boosted by easy cash. I think we will correct to 8000ish as people remember why tech crashed in the dotcom era and the disconnect between the value of tech companies and their actual productions.

Isn't Boris a great guy? He's so concerned with finding creative ways to get young people into houses...
Absolutely nothing to do with the risk of the economic ruin of a collapse in house prices I am sure.

Younger gen cannot afford housing with the way prices are going. US median house is 15 years median pay. This is the capitalist solution.

<_< I'll be able to afford it if my parents die suddenly and their healthcare bill doesn't claim the estate.

If they need to be in a "home" well, that was my shot.