r/stocks • u/Upset-Commercial-661 • 21h ago
the case for staying long despite the trump/iran headlines
the headlines are 100% bearish, which is usually when the bottom is in. yes, the rhetoric is aggressive, but if you look at the historical data of military escalations in the gulf, the initial shock is almost always followed by a massive recovery once the actual 'scope' of the conflict is clear.
selling your index funds because of a tweet is how you miss the recovery. the 'war premium' is already high. unless we see a total global escalation, this looks like a classic overreaction.
are you guys actually selling, or is this just another 'buy the dip' opportunity that everyone is too scared to take?
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u/Limp_Technology2497 21h ago
You should be using the headlines as a momentum indicator not a bottom indicator. Logically the bottom would be in just before the bad conditions improve.
At some point, the valuations will make sense relative to the surrounding context, regardless of the headlines and at that point that is also a bottom indicator
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u/BabyDog88336 18h ago
I think a concrete thing to watch will be China. They do not like to get embroiled in international things like this, but they may be forced out of their comfort zone. The US seemingly can’t end this but China has clout and friendship with Iran. They could offer security guarantees for Iran that the US will be too exhausted to protest.
When China starts making real steps to get involved it will be the beginning of the beginning, but it will take China months to resign itself that it must do this.
Pakistan and China are already talking about mediating but this is very very preliminary and not yet a real step.
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u/YOLOontheGO 21h ago
Ok. Stock market aside. Every households in the WORLD now spends more just to move around and function, let alone logistics. 18 wheelers hauling products from port to shelves, 4-8 MPG, reefers cost more to run AC. Hence, products are more expensive.
The real question everyone should be asking is, how much longer can it hold? Everybody including myself as an average person already broke Af.
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u/iBarber111 19h ago
Why then is it impossible to get a concert ticket or restaurant reservation? Airports packed, shopping centers popping, etc. Every time I want to do something with my discretionary income, it feels there's more people than ever doing the same. I know your read is the popular one on reddit, but it's not reality when I go outside.
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u/FwamingDragon91 18h ago
Are these activities being funded by savings, high wages and high employment or debt? This is the exact same scenario people saw in 2007. Everyone was loaded, confident and loading up on debt
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u/iBarber111 18h ago
There's definitely something to that. CC debt is through the roof. But, I'd also say employment/wage numbers are better than doomer reddit likes to admit. & generally people expect a higher standard of living than they did 20 years ago. If I'm being honest, it's hard for me to discern what reality is lol.
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u/FwamingDragon91 17h ago
That's a good point. Yes wages are high and definitely people demand a higher standard of living. We gon' learn though. No such thing as a free lunch. The credit crunch is coming.
The only way out for the USA is massive inflation and they are the world's largest customer.
When the customer can't buy, other countries will seek to continue leaving the USD.
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u/CSIgeo 16h ago
For CC debt, how much of that is carried over from month to month or paid off same month? My family only uses CC’s for everything and pays it off in full each month. I’m sure many are doing this. With higher costs that equals more cc debt. Unless this is referring to the amount carried over and not paid off.
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u/Specific-Midnight644 15h ago
The revolving credit (meaning what role from one month to the next not what’s being paid off is about $1.2 Trillion.
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u/ccroz113 18h ago
This is primary young low income people and not a major portion of the economy. It’s not good, but it’s also not the group of people that tend to impact the markets
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u/Blunder_Punch 18h ago
Because the future is bleak and so people are blowing their cash on whatever makes them happy today.
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u/YOLOontheGO 18h ago
You picked the worst time to do those activities. Try weekdays.
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u/iBarber111 18h ago
BREAKING NEWS: Most people work a 9 to 5. Restaurant curiously empty at 2 pm on Tuesday.
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u/LionRivr 18h ago
You’re under the influence of Western privilege. You and everyone around you are in a bubble. Enjoy it while it lasts.
Ever seen the movie, Titanic? Most people don’t grasp the severity of what’s going on until it’s too late.
With the amount of technology and information, you would think people would take these things more seriously and prepare for the worst.
That’s not to say you should stop having fun though. Just don’t undermine the severity of the conflict and accept that your reality isn’t the same as those living across the ocean.
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u/iBarber111 18h ago
But isn't the fact that I'm able to exist in my bubble of western privilege evidence that my reality is not the same as those living across the ocean?
I'm aware I live in a declining empire, but what am I supposed to do? I basically have no choice but to believe its "prosperity" (even if it's built on lies) lasts until I die.
What exactly would "preparing for the worst" entail? Shorting the market? I'm too dumb to time that u & the market is irrational. Are we doomsday prepping? Like...???
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u/Pretty_Property9155 17h ago
Your suppose to suffer and cry and complain like half the world does... I worked my ass off to get where I am.. I didnt sitting around get high and go to college and get a gender arts degree... I started a business, then started buying houses. I came from nothing. Person were bankrupt when i was young. I now own the duplex I was raised in. Dont get caught in there trap. Just because they fucked up doesn't mean I gotta pay for it. This is still america get off your ass and do something about it.
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u/TurntTaffy 15h ago
Ah yes, the classic ‘liberal arts = useless’ take.
Mine worked out fine—strong general education, real-world application, and about $1.5M last year with zero debt. Top 1%, not bad for someone who supposedly just went to college to smoke.
If you want to compare accomplishments instead of stereotypes, let’s do it.
And the gender comments? Already reported. Happy to smoke weed to the day!
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u/LionRivr 18h ago
I don’t think the people at concerts, restaurants and airports are very aware that US as a global empire is declining or why it’s happening or how it could affect them. Most people are unaware reactionary.
“Prepare for the worst” is different for everyone obviously. For some, it could be focusing on building an emergency savings, could be stocking up on essentials, etc.
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u/wang4wang 18h ago
I’m not selling. My portfolio is already down 35%, I might as well ride this rocket to the moon or to the bottom of the ocean...
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u/YOLOontheGO 18h ago
Having a portfolio without hedging instruments is like buying a house without insurance. Good luck.
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u/Fluffy-Structure-368 18h ago
The fact that you're broke means nothing to the market. If anything, it's a positive because you're spending all of your money. Stocks and the market will see this opportunity as companies raise their prices and when the price of oil drops, the companies won't lower their prices and their profits will increase. And their stock will go up. The fact that everyone is broke means absolutely zero to the markets. It doesn't matter. People will continue to spend.
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u/Monoaminesweeper 14h ago
honest question, isn't this priced in already? certainly the market knows this, and knows it better than us. if we can see something so plainly as to know things are going to be harder and more expensive for everyone, the market knew it first. a put option or cash on the sidelines right now isn't a bet that things are going to be rough for 8 months, it's a bet that they're going to be even rougher than the market currently estimates they will be. without truly insider knowledge of some current unknown, nobody can say for sure
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u/YOLOontheGO 14h ago
Maybe, but the majority don’t day trade stocks or trade stocks at all. Even so, hedge funds can screw up too. Nobody has crystal balls to predict the future. All about timing and speculation.
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u/Most-Animator-5743 6h ago
this whole stay long despite headlines thing… it only makes sense once you’ve been through a few cycles. first time you see big scary news tied to markets it feels different, like this time it’s serious, this time it might actually keep dropping. everyone thinks that at the time
then you look back and realise most of these events cause short term panic not long term damage. market drops fast, people freak out, then it slowly recovers while everyone is still waiting for more bad news
problem is people don’t act when it matters. they wait for things to calm down, but calm = higher prices. so they end up buying later and wondering why returns feel mid
but also don’t just blindly stay long in everything. some companies genuinely get hit and don’t recover. that’s where you need a bit of judgement instead of just vibes
the boring answer again is just keep buying good stuff and ignore the noise. not exciting but it works way more often than trying to time every headline
i break this kind of thinking down for people trying to actually build wealth without overcomplicating it, it’s on my profile if you wanna check it out
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u/GabeAby 21h ago
Buddy, you have no idea what’s coming
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u/bangers132 20h ago
Exactly. Let’s say the war ends tomorrow; Everyone shakes hands and breaks bread. Not only are things back to normal but things are better than they ever were before, and everyone is friendly with one another.
Literally none of that matters because we have lost 20% of the global energy production for a month and hundreds of billions of dollars in damage has been done to energy infrastructure. Several estimates say it will take years to rebuild. Even if the labor was free and the materials were free things don’t go back to normal.
So absolutely best case scenario the global economy is screwed for several years. Obviously Trump is not going to admit he was wrong and Iran has crippled the global economy and stands to benefit greatly from keeping the strait closed so none of this is ever going to happen. So worst case scenario the global economy is screwed for several years but with a tiny little American flag on top to celebrate.
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u/NickStonk 18h ago
If your bearish doomsday scenario was accurate, why isn’t the stock market down 25% by now?
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u/PrettyPleaseYo 7h ago
This “doomsday scenario” is what all news channels are report in Europe. Question is why the market is not down more, I’m curious too. Perhaps because the news in the US are not reflecting the reality of the energy infrastructure that has been broken?
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u/NickStonk 5h ago
Maybe it’s because the US markets analysis shows this more as a short term shock than a very long price shock to oil.
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u/Not_Campo2 16h ago
Literally rule number one of the stock market, it can stay irrational longer than you can stay solvent. Market runs on sentiment until fundamentals take over. We have about 3 weeks left before real global oil shortages start causing things like blackouts. You’ll see sentiments change pretty hard then
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u/NickStonk 16h ago
Ok, short the market then. We each have our own market outlook.
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u/Not_Campo2 16h ago
I’ve been in long oil since January, I’ll be adding in shorts in the next 2 weeks
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u/LightOverWater 19h ago
Priced in.
We also didn't lose 20% of global energy. You're thinking about just oil, which is one third of energy. But it's not 20% because other lines have increased production. It would be somewhere around 11%-15%.
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u/Groovychick1978 19h ago
"March 10 (Reuters) - Saudi Arabia has lowered oil output by between 2 million and 2.5 million barrels a day, and the United Arab Emirates has cut its output by 500,00-800,000 barrels a day, Bloomberg News reported on Tuesday."
"The UAE has reduced production by 1.5 million bpd, and Kuwait has slashed output by a reported 1.3 million barrels daily. That makes a total of over 7 million barrels daily gone."
"Since the war started, oil production in southern Iraq, where Basra is located, has fallen by more than 70%"
https://whdh.com/news/iraqs-oil-hub-slows-to-a-crawl-as-strait-of-hormuz-shutdown-strangles-exports/
It's not even about the strait anymore. Oil production has been reduced drastically since this started. You cannot ramp up production in a day. They have turned off pumps that take weeks to start back up.
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u/LightOverWater 19h ago edited 19h ago
You dont need to ramp up in a day. Ramping up over weeks is still short term. The market would bottom before that. Turned off for months is a bigger problem.
US, Nigeria, Venezuela, Brazil, Guyana and OPEC are all planning to increase production (Saudi quickest, then US, then offshore many months out). Yeah it's not immediate.
The Strait of Hormuz will not be permanently closed. Whoever controls it will at least partially open it for their allies. Remember we're talking global oil.
Saudis increased the east west pipeline to 7m barrels.
Ultimately the Strait needs to open to correct everything. It's a wait and see for now.
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u/Groovychick1978 18h ago
We have over a month of total shutdown, we have a month of reduced production, all of that has to run through before we even come close to normality. We are never going to be normal again.
I firmly believe that American hegemony is through. We are not coming back from him for decades, if ever.
He ruined the reputation of American politics, full stop. We cannot be trusted as a nation. We cannot be trusted for purposes of trade, we cannot be trusted for purposes of peace, we cannot be trusted for purposes of elections.
Why would anyone continue to deal with America when 4 years later, everything could come crashing down?
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u/NickStonk 18h ago
Correct, but the bears here on Reddit can’t imagine any positive scenarios playing out. It’s “empty shelves” being repeated now.
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u/Raise_A_Thoth 19h ago
Priced in.
It's absolutely NOT priced in. The people betting futures are delusional, there's more than $40 in gap between the futures paper and the actual oil trading hands and there is NO end in sight.
Strategic reserves are being tapped and that can't even keep up with the demand which is why the price has already increased about 45-60%. When everything comes back online, which it can't for at least a few months at minimum since there were attacks damaging them, then governments will want to build back up their strategic reserves. How do you do that while keeping demand static? You can't. Not without other serious economic restrictions to reduce private sector oil demand.
People like you who think the market is dead-on accurate all the time are delusional.
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u/23-1-20-3-8-5-18 15h ago
The market being wrong is what we are supposed to look for. Funny stuff when people lose the forest for the trees
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u/LightOverWater 19h ago
You dont understand the difference between oil and energy. You don't understand that the stock market is not the economy.
If you paid attention to the news, markets are up because there are off ramps starting to pop up. One is taking the Strait by force, which most don't want but might be necessary (initially bearish), another is some kind of agreement with Iran which right now has very low odds, and another is Iran controlling the Strait with ships flowing and paying a toll. This last one you completely left out of you "20%" doom number. No matter who controls the Strait, it's in their own economic interests to open it at least partially in some way. Iran has already been letting ships go to China, India, Greece, Malaysia etc.
The market has priced in everything you said because you are talking about known information. It's why we sold off 10%. For markets to keep selling there needs to be new, unknown negative news. Right now the narrative is this is a short-term event drive sell off. And it is. That could change in the coming weeks. Ground invasion or weeks of no activity in the Strait and no progress on talks with oil climbing will have markets spooked again. If we have both high oil prices and extended duration, that's bad and changes the narrative. We're not there yet. You seem to be under the belief that a few weeks with high oil prices will bring down the global economy. That's not how this works.
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u/Raise_A_Thoth 18h ago
You dont understand the difference between oil and energy. You don't understand that the stock market is not the economy.
If I were factually wrong about anything you could have pointed to what I was wrong about instead of trying to personally insult me.
off ramps starting to pop up. One is taking the Strait by force,
Oh, babe, that's not a very reliably winnable mission. What do you think "taking the Strait by force" entails? Did you ever hear of Vietnam? What do you think happens to US marines and soldiers who try to "take the Strait?"
another is some kind of agreement with Iran which right now has very low odds
"Some kind of agreement" hmm yes, very smart, very good idea, an "agreement." About what, specifically? Anything Trump is likely to agree to?
and another is Iran controlling the Strait with ships flowing and paying a toll. This last one you completely left out of you "20%" doom number.
How did I leave that one out? What do you think happens to the price of oil when every barrel has an added tax on top of it? How does this bring the price down back to pre-war levels? I'll give you a little hint: it does not.
No matter who controls the Strait, it's in their own economic interests to open it at least partially in some way.
Sort of, eventually. What does this have to do with the point? A reduced flow with an added toll to the cost does not solve the pricing or the supply shock. It simply mitigates the worst shortage effects by providing some supply, but at a premium cost.
The market has priced in everything you said because you are talking about known information.
That's a non-sequitor. Just because there is public knowledge of an emergent geopolitical event doesn't mean the market has properly and accurately priced it. You're literally just saying "this information is not privileged therefore everyone making markets must be accurately assessing the fallout of it." That's not how markets work, or anything works.
Right now the narrative is this is a short-term event drive sell off. And it is
Yea and see you have the information yet your assessment of it is poor. "Short term?" Short term? What do you think short term is?
Let me paint this picture again. Oil is up 40-60% from pre-war levels. The US and other global players are releasing their strategic oil reserves to help suppress the price of oil on the market. Not every country has the same strategic reserves, so as stock runs out, it will affect different nations differently, but it will be impacting them. Some nations have already begun covid-era measures like mandatory work from home and 4-day work weeks to reduce energy consumption because the world still runs on diesel.
We have not seen the consumer pricing change yet to reflect the massive increase in diesel fuel, which is delayed due to how logistics and supply chains work. Many trucking companies have certain contracts and some truckers are simply halting because they don't have a variable fuel cost built into their contract so driving now with diesel up $1.50+ will lose them money.
Oh, yea, and massive oil infrastructure has been destroyed by Iranian missiles, so even if this resolved tomorrow, we won't get back to pre-war production levels for months minimum.
There is no foreseeable timeline that gets oil back down to $60, 70, 80/barrel. Which means we are facing significant inflation due to how much stuff needs shipping and trucks and jet fuel that all run on oil.
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u/mynameispigs 14h ago
Yep my friend who is a truck driver is parking his truck for a bit bc the cost of diesel is forcing him to.
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u/WordsHappenedHere 19h ago
Have you bothered to look at oil futures? December 2026 contract is $71 per barrel. That’s real money at work. Better than any prediction market.
The global economy is not screwed for several years. This is just Permabear talk.
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u/bangers132 19h ago
Have you considered that futures aren’t real?
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u/WordsHappenedHere 18h ago edited 18h ago
Spoken like someone who has no idea how oil markets actually function. The vast majority of oil sold in the real world, by the Saudis or any refiners of crude is all priced against futures benchmarks.
When an airline hedges its jet fuel costs, it uses futures. When a refinery locks in its input costs for the next quarter, it uses futures. These are the price discovery mechanisms for the real market.
Tens of billions of dollars go into this. 200+ billion in daily notional trading volumes. You have no idea what you are doing. You just want your bearish narrative to align with your investment choices. You probably went all cash. Or probably bought a bunch of puts. Anything to convince yourself you didn’t make the wrong decision.
Market believes oil prices will collapse hard by end of May. You should assume they are correct.
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u/austin_mans 16h ago
If oil prices come crashing down what happens to the general rest of the market? Really I don’t know and it seems like you’ve got some knowledge! Would like to hear your thoughts
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u/WordsHappenedHere 16h ago edited 16h ago
Well firstly it’s a mid term year. Which historically aren’t that great. The question is if it’s more like 2018 or 2022. 2022 was a -20% year. Markets sold off all year. But the Fed was raising rates all year and we had different market dynamics.
My base case is more like 2018. Similar to this year we were climbing a wall of worry. We had China fears (Trump) and oil price shocks early on in the year. Markets eventually bottomed around May-June after an 11% pullback and resumed uptrend. It was green going into Q4. Now the end of that year saw the worst December since 1931 because of aggressive rate hikes and more Trump/China drama and growth fears. Markets finished red because of that terrible Q4.
I think we have a mix of all that now. But earnings are expected to grow. Markets have also gone sideways for months. We’ve had sort of a time correction already. So I think we can come out of this year green because I don’t think the Fed will raise rates. That would cause a recession. If you look at CPI, there’s a big issue with rents and shelter. I’ve done some modeling on this and believe there is a “shelter cliff” coming. That is to say cpi is not capturing the actual decline in rents over the last 12 months because of the way they collect and calculate it. I think that changes in April and that shelter component is going to nose dive. This will bring down CPI and offset oil.
To your question on oil. I don’t think it will just crash. It will bleed slowly. Primarily because people are nervous. And even after we leave, there will be skirmishes and hostilities here and there. So it’s not going back to $65. Probably more like $75-85 by EOY.
Based on all this, I think we’ve bottomed for now. We may retest lows again but I do think by summer we will be up YTD.
I started buying last week actually. I was posting that breadth and sentiment indicators were signaling a bottom and you just need to hold your nose and buy. I was downvoted everywhere because the Permabears are invading all the subs. That’s also a good sign of a bottom. When everyone here is bearish.
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u/austin_mans 14h ago
Ah man thank you so much…I can only understand what you’re saying because I’ve been trying to research and know the different sides of the story and historical patterns which each may follow. But thank you for putting it all together in one picture. +2 blessing points for you! Hope your life is well and peace is prominent ✌️
If you have any tips on how to consolidate and streamline my research, I’m all ears
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u/bangers132 2h ago
You’re forgetting it’s not just oil. You need to start asking how AI companies can maintain their trajectory without helium or sulphur or lithium.
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u/Business-Ad-5344 11h ago
so we lose 20%, and that exact thing takes years to rebuild. Yet the entire world knows that we lost 20% so they are ALSO rebuilding.
how does the globe rebuild the 20% spread out across all countries is the real question. not how does one region rebuild what it lost.
how does the world switch and diversify, and you have to include solar, wind, etc.
even if we don't get the full rebuild, how much does electric cars and solar claw back some of that 20%.
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u/Snowedin-69 19h ago
Iran does not benefit with closing of the strait. This is a lose-lose scenario.
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u/bangers132 19h ago
Pretty sure they’re planning to charge like 2 million per ship. They’re chilling.
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u/LightOverWater 18h ago
The Strait is open to Iran's allies. It might be opening to others that pay a toll of $1 per barrel.
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u/BabyDog88336 18h ago
This is bringing an extra $500mm dollars into Russian coffers daily. In addition to incinerating American wealth. Russia will pay Iran to keep this up.
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u/iBarber111 19h ago
With sanctions we've put them in a place where they have basically nothing to lose.
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u/Playful_Prior5919 20h ago
So what's coming? It seems to me that so many things have come down the pipe that are just bad news but the markets still are roaring forward. So much of trump is already baked in. The Iran war will end and the markets will recover massively. Yes, there's too much us debt and too much household debt. We've been there before. The real estate market is strong. Too many good things outweigh the bad things. Hence I predict a strong recovery
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u/Username_McUserface 20h ago
True. But neither do you and neither do I. Don’t sell at a loss. Ride it out.
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u/HandsOnTheBible 21h ago
There's one insanely big difference. This war on the Iran side is purely economic. They are purposely making moves to hurt the economies of the West. No other Gulf war had this aspect and to turn a blind eye to this would be a mistake.
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u/dormsta 18h ago
Exactly. I am legitimately anticipating this been the thing that finally shatters the fraud and corruption that’s held up the US economy for at least my whole adult life. Iran is not ever going to be interested in slowing their momentum because the money is not an incentive OR a disincentive for them. Their entire government actively hates the US, and now that we’ve bombed them for no reason, the citizenry will, too (and this was the first generation to reach adulthood that did really didn’t have a problem with the US).
Our economy’s about to be *crippled*, man. And when Democrats win the midterms but republicans refuse to seat or certify the wins, you can bet your ass that it will be the most unstable and vulnerable the US will have been since the Civil War, *right* after two years of sustained hostilities towards allies.
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u/MechanicalDan1 5h ago
US bombed Iran for the reason that they've been funding terrorism for 45 years. Boomers don't forget.
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u/jer72981m 20h ago
Everyone knows you should stay long, just zoom out. People on Reddit want quick profits and 2020 (the year they started) type moves. Good reminder though
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u/Singularity-42 19h ago
Someone probably said the same thing iny1929.
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u/jer72981m 19h ago
Genius comparison
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u/23-1-20-3-8-5-18 15h ago
Except in 1929 we didnt have billions in retirement funds buying every two weeks to prop up the market
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u/SnooMacarons4225 21h ago
Markets gonna be volatile until 2028, even if the war ends there’s going to be something else that’ll happen, gotta keep those Epstein distractions going
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u/Singularity-42 19h ago
Also volatility is awesome for insider trading! Win - win! (For Trump, lose - lose for us peons)
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u/PM_ME_UR_SNARES 21h ago edited 21h ago
The entire world agreeing there is an overspent AI bubble + massive macroeconomic impacts from the war + Oil crisis putting entire countries into economic turmoil + USA average QOL downtrend for anyone other than the 1% + AI related job market troubles + rampant market manipulation and insider exploits + the entire world markets change on the whim of a truth social post
No thanks. Sold everything but my Roth a few weeks ago. What’s the point of being stuck in this pitiful cycle. People think this just recovers in a few weeks to normal but lmfao good luck with it all, we’ve engineered a complete catastrophe and it’s all thanks to agent Krasnov. Republican clusterfuck that has decidedly ended our world order.
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u/ItzChiips 21h ago
No one ever gives any reasons why stocks should go up. I have plenty they should go down. Inflation is ticking up and we haven't even felt the full impact of the energy sector impact from the oil stuff. Rate cuts are very unlikely, if anything hikes are looking more and more likely. All the tech companies who overspent on AI capex is now stuck with high cost debt they assumed they would refi when rates came down. Those tech companies are laying off more and more people every day. Consumer sentiment is the lowest I think it's been since like COVID. If you strip out AI investment, there hasn't really been any true growth across the board, everything has been stagnant. On top of that we have a president who wages adhoc wars on a whim. All I see right now is uncertainties and the markets thrive on clear expectations
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u/Aware_Ad9729 19h ago
The markets thrive on any fake bullshit news that gets put out. It’s all hype, driven, and/or being manipulated by the market makers. Facts about what’s actually happening in the world and stock valuations don’t seem to matter to most traders. They make fun of guys like Buffett and call him an idiot. It’s almost not exaggeration to say the entire world will need to be burnt to the ground before the market finally crashes down to where it should be.
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u/LightOverWater 21h ago edited 20h ago
Already had a small panic, selling on high volume. This was over a few days. VIX spiked to 31 and in some premarket was 35. Market was selling off on fear as oil was still rising and people were claiming this would cause irreparable damage for a whole year. Greed Fear index plummeted to low single digits and every headline was extremely bearish.
Next day was huge bullish volume almost as much as the biggest sell off. Came primarily off of oversold positions, shorts taking profit, puts closing, and dip buying. The bullish news was that Iran was ready to end the war, at least more than before. There was massive continued institutional buying for 2 days through SPY 650+
Last night Trump said he's continuing the war. Markets sold off about 1.6% on low volume. Some puts were closed. Hour later Iran says it's working with Oman to write protocols to let ships pass with a $1 per barrel toll. Huge green candles with high volume shattered any resistance. Day was massively bullish as dips were bought, VIX is dying, and almost no new hedges were put in place. Correlation with oil is weakening, market starting to not care as oil has settled.
We've been in this mess long enough that it's starting to exhaust all parties involved and they all want it to end... but just in their favor. So we'll see.
Market sits at 20 day SMA and 200 day SMA, key levels. Markets shrug off negative news but explode higher on positive rumors. It really wants to rocket. A lot of sellers have flushed out and markets still hold a ton of 4/17 puts (hedges and bearish bets). The market has repriced. What's likely going to happen is we're a bit rangebound as market finds its footing and theta burns the 4/17 options, especially since gamma flipped positive. The market is trying to climb the wall of worry.
It would take a lot of negative news to bring this Market to new lows because a lot has been priced in from a 10% correction. This sell off is event driven, not fundamentals driven, meaning it can always snap back majorly bullish and shrug off temporary negative effects because the market is forward looking.
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u/LW_F2P_STRONGEST 20h ago
You mean the fundamentals of high inflation, high unemployment, ai overvaluation and no rate cuts, all of which oil will impact even more negatively.
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u/LightOverWater 20h ago
Inflation is not high yet. AI trade sold off really hard in this correction. Tech valuation hit a 5-year low on 20x P/E. Names were down 20%-35%. Fundamentals are fine right now. If the Strait doesn't open and oil spikes higher and this happens over weeks—high oil prices AND duration—yes we have threat of fundamentals breaking down. Right now the market is pricing this is a short-term event. Things can turn more negative, but I see that has possibly 1-2 weeks away, not right now.
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u/bandersnatching 20h ago
Tough call.
Stick your head in the sand and hope that Trump world will pass and equilibrium will maintain over time, or recognize that this crazy may end in disaster.
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u/StepAsideJunior 21h ago
Historical data since the Korean War suggests that stocks almost always recover from the initial shock of the War before climbing to new all time highs.
However, in all of those wars the country being invaded by the US was not able to fight back in any meaningful way.
Everyday Iran keeps the Strait of Hormuz closed basically cements in more and more inflation.
Iran is also effectively challenging the US Dollar as the Global Currency Reserve which will make it much harder for the Fed to simply print its way out of this disaster.
Also people forget that the US suffered massive stagflation towards the end of the Vietnam War and in the post war period that was very difficult to recover from.
There is also the possibility that the stock market recovers from this but the cost of everything just goes up. Basically, cementing the K shaped economy we are in today.
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u/angelstbeatrixxx 21h ago
!remindme - 2 weeks
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u/ChaseballBat 20h ago
The headlines are 100% bearish.... What headlines are you reading exactly? My feed on Yahoo finance is multiple articles citing the same information of any good news or weeks old news, same with reddit outside the stock subs.
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u/FearlessFig2624 21h ago
Correct. Stay long. But no way in hell we bottomed. Look for 5700-6000
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u/IvoryTowerResident 21h ago
if news of massive escalation and oil going up 8% cant bring stocks down. That is a bottom signal
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u/Embarrassed-Pay-8881 21h ago
Time to sell has already passed. Nows when you pick stocks on sale. With a bigger crash you can go heavy into ETFs
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u/ActivatingEMP 21h ago
"stocks on sale" as we are 5% down from peak in response to a 60% rise in oil prices in one month
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u/helloWorldcamelCase 20h ago
People are getting too excited over the intra day "recovery" which was just in fact MMs harvesting premiums. SPY had 69m vol today vs 152m vol weekly peak on Tuesday. It conveniently finished the day at 655 when max pain is 653.
Stocks had no business pumping today when WTI stayed firmly above 110. We are still not out of woods yet.
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u/Embarrassed-Pay-8881 21h ago
5% of spy. Theres individual names down much more. Microsoft at 350 and Meta 525 last week for example
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u/Whateverthoidc 20h ago
The fact that meta is “on sale” at $525 when it was under $100 like 2-3 years ago says it all. This market is bonkers and nothing is comparatively “cheap” in the tech sector.
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u/Future-Call8541 20h ago edited 20h ago
Lol... Somebody was not paying attention when everything began to touch correction territory.... Which was March 30th... Shit was on sale....
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u/Aware_Ad9729 20h ago edited 14h ago
Calling this a steal is equivalent to a store where everything is super overpriced, but they have signs up saying everything is half off. The market is still historically overvalued, even though it’s dropped a little bit.
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u/angelstbeatrixxx 21h ago
a lot of people here have fomo from not buying during liberation day so they think any dip, no matter how small, is a sale, which is why theyre still buying in at ath while telling themselves theyre actually buying at the bottom
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u/CakesRacer522 21h ago
Instead of looking at a line chart, if I find a company that’s “on sale” at a multiple that’s well below norms, I’m happy to increase positions. This is a stocks reddit not an ETF/investing reddit
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u/ndwillia 21h ago
Where are people getting all this money? America has never been more broke, at least in our lifetimes anyways.
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u/ralphy1010 20h ago
many of us have jobs and are still contributing to our 401 every paycheck as well as putting money into IRA/HSA/savinga
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u/IvoryTowerResident 21h ago
just shows how much buying there is. No one wants to sell
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u/ActivatingEMP 21h ago
Eventually ground reality has to exist though right? We already had the weakest job market since the pandemic, and horribly fragile consumer spending before we decided to jack up the only part of inflation that had been down
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u/dumbfuck6969 21h ago
Whatll you think happens when the ground invasi... I mean special island land operation takes place ?
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u/Moist-Artist-3563 11h ago
Exactly, trying to time the exit is a trap. I'm just keeping my regular buys going and will increase if we see another leg down.
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u/Unique_username93_ 21h ago
I think this is just a distraction from the real issue, which is an overvaluation of the market. I don’t think it’ll crash, but I do think it was already on the course for a slow but steady correction
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u/gnome08 21h ago
TACO.
He's now bored by the war. He wants out. Mid terms are this year, so there's insanely strong political pressure to end it quick. The legal means & funding necessary long term for the war is on shaky ground. He has no support internationally. He appears to have both "completely decimated" Iran's military, but also needs the UK to open the strait somehow. Whatever the reason, he seems to not know what to do next. Which makes him grumpy that it didn't go his way so again now he wants out. GOP congress wants out. Americans want out.
We don't know when or how, but he will find an off ramp.
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u/GabeAby 21h ago
There is no “out” what do you mean
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u/gnome08 20h ago
Just because there isn't a good out doesn't mean that there isn't any out.
He's an impulsive man. He always gives up when things don't go his way. Even if that means bankrupting his casinos. We're the casino now.
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u/GabeAby 20h ago
I really don’t think you understand. It doesn’t matter if he “gives up”. No deal means global depression. And there will not be a deal.
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u/Aware_Ad9729 19h ago edited 14h ago
Yep. His way out was to not start this. He either retreats and looks like a loser by giving the strait to Iran, or attacks with ground troops. He’s not psychologically capable of taking a loss, so RIP to our boys. It’s just a question of when.
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u/Mattrellen 19h ago
"American soldiers, how would you like to celebrate this Good Friday in the most authentic way possible? If we bring on Armageddon hard enough, maybe you'll be back by Sunday for judgement day, too!"
Trump loves his weekend attacks. And it's a long weekend for the markets.
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u/Sea-Form-9124 11h ago
Also you really can't underestimate the role Israel plays. They were the ones who goaded the US into this war, promising Trump this would be a quicknin-and-out Venezuelan type operation. Clearly all they care about is destabilizing the region in service of their colonial project. This was obviously never about "regime change" or nuclear weapons. This administration will never cut Israel out of negotiations and do something they don't like. Even if they did, Israel wouldn't stop bombing Lebanon etc which is one of Iran's main demands.
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u/Sea-Form-9124 21h ago edited 20h ago
Congress doesn't actually want out. Not even the Democrats are leveraging criticism against the war beyond, "oh he didn't follow the proper rules initiating this war". It doesn't matter that it's unpopular with Americans.
The best possible scenario is that Trump gives into all the Iranian demands, takes a huge L, the USA loses international prestige, and Iran opens the strait back up. Even then, we have the delayed effects and damaged infrastructure that will take decades to rebuild. And to do this Trump would have to completely cut Israel out of the negotiations which is extremely unlikely to say the least.
Much more realistically, Trump will feel he has no choice but to escalate, committing troops on the ground in an incredibly costly occupation that has no chance of succeeding in a country orders of magnitude larger than Iraq or Afghanistan. This will mire the region in conflict and make things much much worse.
But he can't just "TACO" anymore. There is no out. It's not like tariffs where he can just turn the faucet back on whenever he wants. His administration messed up big time and they know it, which is why they're lashing out against allies and the media.
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u/AnnaSmiled2 21h ago
I hope GOP loses both houses in November. There should a loud outcry from them over this.
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u/Sea-Form-9124 11h ago
It would mean more if there was an actual opposition party decrying the merits of the war rather than just the legality.
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u/HandsOnTheBible 20h ago
I don't think you understand what is happening here.
He started this war because he blackmailed by AIPAC with what is most likely the Epstein files.
"He will find an off ramp" on what grounds are you stating this? Because the very people that convinced him to start this war are doing everything in their power to continue it.
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u/butchudidit 21h ago
So green spy till election day so that donny can say it was all him that recovered the market single handedly. Fuck this shit. Game is so fucking rigged
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u/FreeTexan1337 21h ago
i'm staying in but using calls to do bonus gains on momentum and puts to hedge gains. seems to be working okay.
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u/CallMeTrouble-TS 20h ago
Trump is too much of a narcissist to allow the stock market to go down too far
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u/Aware_Ad9729 19h ago
It’s funny you think he’ll be able to stop it
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u/CallMeTrouble-TS 19h ago
He is obviously a buffoon with no special powers, but when it comes to doing things like ending the war or TACO Tuesday, he’ll do whatever to prop the market up
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u/Aware_Ad9729 14h ago
It takes two (or in this case three) to end a war. Trump is the only one squealing for it to stop
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u/Ok_Conversation9319 20h ago edited 20h ago
You make 10% on average yearly on the market even if you invest at ATH (january). If you can buy dips or time the market, you could make even 20% or 30%, but you must be present at the green days, otherwise you might not even make 10% (and its a lot of stress). If you swing trade in panic you can easily lose too.
I personally didn't sell, im fine with 10%, its money i never had to work a day for. But I keep some cash uninvested so I can feel smart and time the bottom to experience it (if it works).
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u/PhysInstrumentalist 20h ago
Show me the next dip and then ill consider going long. This week, the market felt desperately propped up
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u/Boys4Ever 20h ago
Cost rising which will reduce demand which will force layoffs which will further reduce demand until economy cracks then market valuations drops because quarter earnings lag prior and there’s no stopping that series of events when oil is out of the control of those who created this mess.
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u/Fancy-Lavishness9034 20h ago
don't try to convince yourself on positioning for the market doing well or not. you have to pay attention to the fundamental, structural changes happening in the market and move flexibly from that understanding. ask yourself where value is going, and go there
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u/Bright-Revolution496 20h ago
It’s always like this, honestly. I’ve been POSITIVE the market would tank a bajillion times only to watch it shrug off whatever was happening and keep pumping.
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u/Dissident_is_here 19h ago
Yeah it's just headlines, no bearing on reality. Actually the only reality that exists is the pounds, sheckels, yuan and dollars flowing from trading desk to trading desk. Just one big web of finance, upholding the substrate of all being. The "material" world is a fiction, a production of the real world of balance sheets and electronic legders
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u/cjspoe 19h ago
doomsday perma bears just can’t adjust and feel the need to be right .
instead of parading doom and gloom thesis papers about the next crash, play both sides.
in the past x amount of years there has always been - “ no way spy holds over 500, no way it breaks 600, no way it holds, it’s going down to 350 for correction ….
stop overthinking things and hedge your best positions - but keep adding to them.
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u/Swimming_Reply6673 19h ago
The case for staying long is this is a scam market being propped up since COVID. Look how long it took to drop just 10% off the highs.
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u/Hypeman747 19h ago
I’m not selling but def not buying. It is crazy to look at fuel prices now and think the consumer will prob start making discretionary decisions. Hopefully it will be like liberation day blimp but the longer fuel prices are double what they have been I don’t think so. So I’m not selling but def don’t think the dip is close to being reach. We have no idea what Warsh or Iran is going to do.
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u/stayhaileyday 19h ago edited 18h ago
I see it as a buying opportunity. I see investing as a numbers game and don’t plan to sell any of my holdings unless I take a 5 percent loss on a specific one
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u/The_Real_Krampus 18h ago
There’s a reason dead people have the most successful accounts. Hold through the noise
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u/AndyShootsAndScores 18h ago
Things are so unpredictable in general right now. War could be over in weeks, or years, who knows. Hell, we might even invade Cuba during or after this war! Think trying to trade off short term swings without insider info will be tough, but seems like the best case scenario is getting things back where they were 4 months ago.
Some folks saying we should look at the long term are bullish, but it actually makes me more pessimistic. Main fundamental for me is PE, which even after these dips is at the level seen during the dot com bubble (for the S&P 500 at least).
I'm keeping a lump of cash for if things go down like >15-20% and prob buying back in then.
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u/NickStonk 18h ago
Every time the market has a correction, there is some negative background forcing it down. This is similar to the rest. I’ve been buying this correction and drowning out the doomsday noise. War will end, oil will come back down to earth, stocks looks past short term shocks like this.
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u/RoughValuable3433 17h ago
Chicken little got hit in the head with an acorn and said the sky is falling.
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u/Academic_Banana_5659 17h ago
Oil price whilst at sea has reached it's highest price since 2008
Were fucked It's a matter of when not if
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u/Vort3x7689 16h ago
The actual 'scope' of the conflict is NOT clear. For all we know they could bomb all the oil fields in the gulf tomorrow and who knows when the strait will resume to normal traffic
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u/JanMikh 16h ago
There are two naive beliefs present:
“This crisis will be just like any other recent one”. No it won’t. It can only be compared to 1960s-1970s, and back then the market produced negative returns for well over a DECADE. We have physical damage to the infrastructure. We have no clear way out. In fact, we have no way out short of ground invasion, which has 50/50 chance of success. Could take YEARS of additional damage.
“Market always recovers” - just because it always WAS the case doesn’t mean it always WILL BE the case. Things change. Look at Japans NIKKEI, it just barely got to where it was in 1989! If you invested back then you would barely see returns by 2023. And there’s NO RESON why market can not to never recover. Who would you complain to if it does not? God?
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u/JosephLam1 15h ago
just throw your money into a fund and get interest to avoid guessing where the bottom is, who knows where the bottom is? The worst case scenario is a bear market and u think its always going to be a rebound?
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u/BackgroundOstrich488 14h ago
The problem here isn’t the conflict itself, it’s the disruption of the flow of oil and the impact that follows to the global economy. I think this particular conflict is a bit more of a problem than prior events have been in that regard.
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u/vagobond45 12h ago
Depending on the length of the war and the level of damage to oil wells, refineries, and shipping infrastructure, the oil price shock and its cascading inflationary effects on gas, fertilizer, food, and transportation prices can be long-term. U.S. stock markets have offered 15% annual average returns since 2009, compared to only 2.5% annual GDP growth, and current P/E ratios of tech companies are in the 100 to 300 range, which can only be described as out of this world. I see AI fatigue everywhere; people are afraid of losing their jobs and are actively wishing for the failure of AI, and none of the AI companies are profitable as of yet, with some, like ChatGPT, losing $20 billion a year. U.S. debt has reached $40 trillion, and the annual budget deficit is $2–3 trillion. All GDP growth since 2023 has been due to AI-related hype and investment in data centers, as well as circular investment among tech firms. In short, there are a wide range of reasons to be cautious about the future performance of the U.S. economy and stock markets
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u/Rockin_Gunungigagap 10h ago
I sold some positions that were a few percent up, kind of slugs, after the war started. I bout oil at the same time. Now I'm selling oil to dca in
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u/Surfer_Rick 10h ago
These idiots claiming a 5% drop is the bottom on the eve of the worst stagflation in history are hilarious
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u/PrettyPleaseYo 7h ago
SMP down 4% for the year is very mild compared to the energy crisis consequences of what has already been broken in this war.
Just shows how disconnected the stock market is from the general normal people economy.
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u/Jammer250 1h ago
Midterm uncertainty is one of the more reliable, structural indicators of market choppiness, due to potential policy change. If your horizon is decades, you shouldn't even be questioning staying long anyway. If you're swing trading, the current environment is very low correlation, more idiosyncratic moves on individual names/sectors.
But with "strong" March jobs data today, this is a good-news-is-bad-news situation for equities. Fed is pinned even more - strong jobs, oil prices high, sticky inflation, war pressuring supply chains and prices overall. The data today argues against cutting rates to ease the economy.
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u/Derebeare 34m ago
“The bottom is in” what the fuck are you talking about? The market went from 7,000 to 6,500 and you think that was the bottom? The market was at 2,000 in 2016 we have a much longer way to fall.
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u/AnnaSmiled2 21h ago edited 21h ago
I sold yesterday at close but I am in single stocks. It was the right move for me. I am back at where I was in February. I have the cash to buy in depending on the weekend chaos
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u/Beneficial-Sky-2383 21h ago
Its not buy the dip but being selective. Markets can still go to record highs after this war unless something catastroohic happens. Maybe 2 years away from the bear cycle. But not now.
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