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Look at margin during early 2020. How it shrank. It’s like a polygraph. This is gambling porn at its finest.
Do you appreciate how fucked up this is? Do you?
The market is fucking degenerate. It’s like those pay per head sportsbooks that allow you to wager on credit.
What percentage of Bitcoin is margin? Just asking.
In my previous post I used the term “invest”. In before you ridicule me for doing so. Of course, nobody was “investing”.
It was a land grab. Not wrong but also not investing.
Special bonus:
You know what was ironic? I do not think Trump benefitted one lick. He was the only person of means in America who didn’t bink the insane asset growth we enjoyed. Even your elderly boomer mother’s retirement assets crushed.
Chart again, cause I can’t stop. I am raw from wacking off to this chart.
Look at how the “margin” goes green after dot com and housing. Oh, the memories we shared.
Care to draw the future? Come up to my room and I will show you my etchings Sonatine.
Quote:
Originally Posted by Sanlmar
gazprom shares. aka why all the 'investigations' into biden's son stayed in the tabloids and out of courts. some threads are too expensive to pull.
correct me if im wrong but institutional investors can write off losses a lot more effectively than retail, yes?
also id love it if you explained to me like im 6 how the 2008 CDO implosion resulted in positive credit balances. like obviously im not really understanding what im looking at here.
Lack of margin debt.Quote:
Originally Posted by sonatineQuote:
Originally Posted by Sanlmar
gazprom shares. aka why all the 'investigations' into biden's son stayed in the tabloids and out of courts. some threads are too expensive to pull.
correct me if im wrong but institutional investors can write off losses a lot more effectively than retail, yes?
also id love it if you explained to me like im 6 how the 2008 CDO implosion resulted in positive credit balances. like obviously im not really understanding what im looking at here.
Quote:
Originally Posted by gimmickLack of margin debt.Quote:
Originally Posted by sonatine
interesting... this is where i really understand how green i am with this; simple concepts like this are difficult to really see/understand in 3 dimensions.
It's only positive in the sense that there's a lack of interest to borrow and/or loan.Quote:
Originally Posted by sonatineQuote:
Originally Posted by gimmick
interesting... this is where i really understand how green i am with this; simple concepts like this are difficult to really see/understand in 3 dimensions.
Here's the whole article...
https://www.advisorperspectives.com/...3-6-in-october
...and here's the inverted margin debt and sp500...
https://www.advisorperspectives.com/...36219cba15.png
...the way the first chart was calculated creates a positive number usually when margin debt goes down. Very rarely could balances go green without it.
I was getting sad that the community was finally getting so dumbed down that they found no enjoyment in this kind of thing, Gimmick.
Quote:
Originally Posted by gimmickIt's only positive in the sense that there's a lack of interest to borrow and/or loan.Quote:
Originally Posted by sonatine
wait is it a lack of interest or is it the credit market risking off? two very different things, obviously.
They're mostly connected, but the chart indicates behavior/status/leverage related to margin accounts. And both are connected to interest rates.Quote:
Originally Posted by sonatineQuote:
Originally Posted by gimmick
wait is it a lack of interest or is it the credit market risking off? two very different things, obviously.
Risk tolerance and/or lack of options move all of them.
Note the date you start to hear about stocks like ATT offering 8% coupon yield….. which it does btw. It’s due for a pop.
and yes, this has everything to do with BTC.
This all plays out in the next 10 months not tomorrow.
Looking at those graphs gives me a sense of dread, 401k really has no great hedge capability….
Maybe slide some $$$into emerging market and high yield bond funds…blah
WWSD…
https://www.thetanarena.com
https://www.twitter.com/thetanarena
4 million players in one week.
Thetan Coin has potential to 10X.
Make up to $100 an hour playing this game?
https://www.youtube.com/watch?v=OH0JUa6oczQ
REAL GAMES LIKE OTHELLO DON'T NEED THE BLOCKCHAIN
The advanced 6 year old explanation, now that i have more time. The chart uses these numbers...Quote:
Originally Posted by sonatineQuote:
Originally Posted by Sanlmar
gazprom shares. aka why all the 'investigations' into biden's son stayed in the tabloids and out of courts. some threads are too expensive to pull.
correct me if im wrong but institutional investors can write off losses a lot more effectively than retail, yes?
also id love it if you explained to me like im 6 how the 2008 CDO implosion resulted in positive credit balances. like obviously im not really understanding what im looking at here.
https://www.finra.org/investors/lear...gin-statistics
...and does this (A+B)-C=X for every month.
A=Free Credit Balances in Cash Accounts
B=Free Credit Balances in Margin Accounts
C=Debit Balances in Margin Accounts
X="Credit Balance"
What you don't see is collateral and number of accounts. It's always an aggregate and only tracks FINRA/NYSE clients customers balances.
Margin Debt movements matter the most because when they go up they lower A and B. And when debt goes down it either frees credit or erases accounts.
They generally still go towards the same direction, but the velocity isn't the same, because even though they interact with each other larger market forces have a larger impact on the direction. Most of the time when they do move to different directions it is related to boom/bust cycles.
A quick glance at few months in 2007-2009. All numbers are in billions. First the Januaries.
2007 (90+156)-285= -39 balance
2008 (142+276)-328= +90 balance
2009 (93+156)-178= +71 balance
Then a few select months when something happened.
In August 08 Free Credit Balance in Margin accounts was 359b. In September 193b. Cash went up 16b and debt 7b. August "credit balance" was +158b and September was +-0b. 166b got erased as Free Credit from margin accounts. Most likely because the assets depreciated and/or people got called. This is one of the few cases where a positive "credit balance" going down is a negative indicator.
In October 08 things went back to "normal" regarding what the numbers indicated. Cash down 7b, Credit down 6b and Debt down 67b. The "credit balance" was +54b. And here the neutral balance going up was a negative indicator.
Also since the left hand side of the equation (A+B) is Free Credit it sort of means that as long as it's above 0 they could get more margin debt. Obv impractical, risky and since the figure is an aggregate it represents millions of different people. But the basic assumption is that they either don't want to borrow or someone doesn't want to lend. And that's related to risk tolerance, investment options and few other things i can't think of now. Oh availability of credit to lend at least.
I'll compile where we are now in another post.
So the latest numbers for 2021 (October).
Cash 226b, Credit 201b and Debt 936b. The balance -509b.
Cash is growing 8% on average and it's up 17% from a year ago.
Credit is growing 3% and down 8% from a year ago.
Debt is growing 12% and up 42% from a year ago.
So the left hand side went up 9% and right hand 42% in a year. The avg growth is exponential and it creates this disparity with relatively small differences. To a degree the left hand side supports the right, but the nature of elements that create a need for more collateral to support margin also tends to depreciate credit in margin accounts and then there's the aggregate thingie.
I forgot to mention bond markets in the previous post. They are also correlated with stonks, can appear as margin credit and with lower margin requirements they can obv lower debt. It's just the mechanism with interest that sort of clears that noise for "credit balance" to function as an indicator of market sentiment.
That said these are Bizarro times. QE, printing, never ending deficit, 2 month recessions and few dozen other things do their own thing.
And then the economic horror porn part from this article...
https://realinvestmentadvice.com/is-...-2000-possible
To highlight what a P/S ratio of ten entails, we quote Scott McNeely, the CEO of Sun Microsystems, from 1999.
“At 10 times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10 straight years in dividends. That assumes I can get that by my shareholders. It assumes I have zero cost of goods sold, which is very hard for a computer company. That assumes zero expenses, which is really hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that assumes you pay no taxes on your dividends, which is kind of illegal. And that assumes with zero R&D for the next 10 years, I can maintain the current revenue run rate. Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those basic assumptions are?”
https://www.youtube.com/watch?v=dI9EgzgXskg
word.
tl;dr i think only a fool wouldnt be bearish fundamentally because you cant just flood the market with counterfeit dollars like we started doing in 2017 and somehow claim its legit because its the fed running the auctions.
however.
whose to say they dont just keep the spinning plates on their sticks for decades and then simply replace them with better plates? (something i learned a lot from; watching burry short tesla. you can be right and still go broke.)
so yeah when i see these doomcharts, i dont know man... i dont trust the market to be unrigged enough to bottom out? ill sure as shit be ready to make money off it if it does tho.
#spy220
Gimmick you're a smart guy clearly...
All Economics and economies are cyclical and cycle. Although there is some VERY important things going on here opposite of what happened in 2007. Like a loose lending markret. Which did lead to a bubble in 2008, but that is not at all what is going on here now, it's very hard to get a mortgage right now. So a sign also the lending Market is tight right now, all of which goes against this is some bubble so inevitably it will pop theory.
Just because prices are HIGH and they are good which they are right now for all, that does not mean that inevitably it must come down, and so this is some bubble it's not, that's not at all what is going on right now, you're welcome glgl...