Generational Dynamics Forum - New Site

I heard a story today that was interesting. One of my friends knows a trader who only trades every few years. I've discussed this trader some, but heard more today.

He doesn't normally keep any money in his futures account. When he is ready to put on one of his infrequent trades, he adds money, puts the trade on, then collects his profit. Today I was told that he has never missed.

This time was different. He added money after the March low, then sold at 2840, 2880, and 2920. He didn't think the S&P futures would get to 2920 but nonetheless they did. He added enough money to be good up to about 3200. At 3200, he had to add more money which, according to my friend, is the first time he has ever had to add more than his initial money.

When he added money at 3200, he sold an additional position equal to the first 3 positions he took.

Another example of the extremes we are seeing. Probably 500 year extremes in my estimation.

Other than this trader, I know 2 other traders and another one I follow on Twitter that I trust to be the most accurate in forecasting the stock market.

All have been bearish for 2 months. That doesn't mean they're short. They're just saying the market is in a very extreme position.

Higgenbotham wrote: Wed Aug 05, 2020 7:24 pm https://www.marketwatch.com/story/like- ... 2020-08-03

By GMO’s math, U.S. large-cap stocks are priced to deliver losses of nearly 5% per year over the next seven years.

As of June 30 when the S&P was at 3100.

https://moneyandmarkets.com/long-term-i ... ar-market/

Gold and Bitcoin are doing very well. I bought some more S&P puts today as the Jan 2021 puts I am buying are now cheaper than before the March crash. There is less time left and the volatility has gone down some as the market has gone back up to near highs. Given Covid, the shutdowns, the March crash, the riots, the trillions printed, the dollar drop, the election, etc I think the risks are higher even given the reduced time frame.

I still think a bit of inflation could crash the market. People would be worried the Fed would not print so fast. With the trillions printed and the dollar down, inflation seems a real risk. So much of what America buys is imported, when the dollar goes down in the international markets then local inflation will go up.

vincecate wrote: Wed Aug 05, 2020 8:11 pm I bought some more S&P puts today...

I'm planning to sell 3 more ES very soon. I think we're done.

vincecate wrote: Wed Aug 05, 2020 8:11 pm I still think a bit of inflation could crash the market. People would be worried the Fed would not print so fast. With the trillions printed and the dollar down, inflation seems a real risk. So much of what America buys is imported, when the dollar goes down in the international markets then local inflation will go up.

I remember seeing a headline when Covid first hit and markets crashed "And the Winner is....Deflation!" I laughed (and agreed in my head). But nobody thought the Fed could basically print its way out of this the way it has. It basically had to merge with the Treasury to pull this off. But I think you are correct that if we actually get a whiff of true inflation (not just asset inflation hahah) things would change rapidly.

What the Fed usually does on this enviro (when there is a rising public perception that inflation is imminent with dollar tankage, stock bubbles, gold and silver rocking) is create a deflation "scare" for a short period. I thought we would have gotten one of these by now. Especially with all the newbies in the precious metals now.

All have been bearish for 2 months. That doesn't mean they're short.

T noted prices now are mainly the fear of inflation due to the magnitude
of the monetary and fiscal stimulus worldwide.
Will raise cash and basically wait.
Will wait for oil, gold and commodity crack up boom to collapse
since we should understand it may last longer than shorts can
stay solvent as we know. The politicians caused this fiat issue point blank.
On my part it will be written as Trump the bag holder compromised in the Office
as American think tanks are criminal untaxed cabals with the agency's in tow
on the back of the working man who is passed pissed off with these criminals.

We did note way back they will embrace the point we are only matching what
we are up against.

Analysts at the Silver Institute say they expect mine supply to continue its four-year slide this year.
Even with most mines back online, the institute projects a 7% decline in mine output in 2020.
Global mine production fell by 1.3% in 2019.

https://www.zerohedge.com/s3/files/inli ... ok=vd8gvME_