2026 Stock Talk

ASAP wrote

I know this has been ad nauseam... but no one here thinks there is an actual correction coming?

If you discount the 7 companies that are consistently passing money amongst each other based on hopes of AI and other companies that are making profit based on major cost cuts - there is really nothing out there that's doing too well...

Layoffs are skyrocketing as well and all interest rate cuts so far haven't proved to result in anything. Not even going to get into the major political / tarriff turmoil.

My view is that the economy is fine and progressing well overall; the stock market is currently consolidating but not (yet) in a bear market. So I’d stay in the market except that there is a lot of political noise (or worse) and it is increasing and all of it looks to me like risk to the economy and market. In other words, I don’t see anything coming from Washington that will help the economy or markets but many potentials to hurt. That is why I posted earlier today that I’ve started moving more to cash. I will likely maintain that posture until the midterms, then reassess.

The fed is always late, should have cut 50bps last month but now will wait and be late again in December.

I won’t elaborate further because of the forum prohibition on politics.

2000cs wrote

My view is that the economy is fine and progressing well overall; the stock market is currently consolidating but not (yet) in a bear market. So I’d stay in the market except that there is a lot of political noise (or worse) and it is increasing and all of it looks to me like risk to the economy and market. In other words, I don’t see anything coming from Washington that will help the economy or markets but many potentials to hurt. That is why I posted earlier today that I’ve started moving more to cash. I will likely maintain that posture until the midterms, then reassess.

The fed is always late, should have cut 50bps last month but now will wait and be late again in December.

I won’t elaborate further because of the forum prohibition on politics.

Would you mind elaborating on how this is measured today?

I'd like the non salesman / non stock market view if possible...

You talk about interest rates knowing full well at this time this has done nothing to help consumers - it was done to help business refinance bad / long term debt. The 10Y Treasury Yield which mortgage loans are based on hasn't moved in 2 years and 30 year mortgages are over 6.2% lol.

So simply from a consumer perspective - how is the economy doing well?

ASAP wrote

Would you mind elaborating on how this is measured today?

I'd like the non salesman / non stock market view if possible...

You talk about interest rates knowing full well at this time this has done nothing to help consumers - it was done to help business refinance bad / long term debt. The 10Y Treasury Yield which mortgage loans are based on hasn't moved in 2 years and 30 year mortgages are over 6.2% lol.

So simply from a consumer perspective - how is the economy doing well?

It is not uniform, as I implied, but GDP/GNP has been up each of the past 3 quarters (it may be down or much lower in Q4 due to the shutdown since gov’t is a big part of it). Inflation is down. Private sector employment is up. Most metrics are good or improving. Again, not everyone experiences the same as things are not at all uniform. There are some negative signs, like recent layoff announcements. But they have not overcome hiring to date.

I would say the Fed’s recent rate cuts didn’t really help consumers but they hurt them less. Meaning if rates have stayed as they were that would have hurt. Fed reductions help stimulate the economy (keeping rates high restricts or constricts it). That helps businesses borrow to expand, which necessitates hiring. If they over-stimulate, that would become inflationary which is why the Fed walks a tightrope - and it has been so fearful of inflation that it acts late with respect to labor. The Fed mostly works on very short term interest rates and lets market expectations work the long rates. However the can and do buy and sell long bonds, somewhat influencing long rates including mortgages directly and indirectly via signaling.

Congress can stimulate or retard the economy with fiscal policy. The CR not getting authorized, resulting in the shutdown, is a good example of a short term retarding of the economy via fiscal policy (congress controls fiscal policy). The stimulus checks during and after COVID were stimulative, and the last round overstimulated and contributed to inflation.

By the way I’ve never been a salesman, I’m retired now. My training was in economics and business, I spent a lot of years as CFO of a good size company that was very active in debt markets. I think I understand these issues pretty well, but I don’t claim to be an expert.


Edit: nothing against sales; it is a skill that would have served me well in my career but I never developed.

Just started the process to dip into a private equity fund. Will see if this move pans out in adding diversification into my portfolio.

2000cs wrote

It is not uniform, as I implied, but GDP/GNP has been up each of the past 3 quarters (it may be down or much lower in Q4 due to the shutdown since gov’t is a big part of it). Inflation is down. Private sector employment is up. Most metrics are good or improving. Again, not everyone experiences the same as things are not at all uniform. There are some negative signs, like recent layoff announcements. But they have not overcome hiring to date.

I would say the Fed’s recent rate cuts didn’t really help consumers but they hurt them less. Meaning if rates have stayed as they were that would have hurt. Fed reductions help stimulate the economy (keeping rates high restricts or constricts it). That helps businesses borrow to expand, which necessitates hiring. If they over-stimulate, that would become inflationary which is why the Fed walks a tightrope - and it has been so fearful of inflation that it acts late with respect to labor. The Fed mostly works on very short term interest rates and lets market expectations work the long rates. However the can and do buy and sell long bonds, somewhat influencing long rates including mortgages directly and indirectly via signaling.

Congress can stimulate or retard the economy with fiscal policy. The CR not getting authorized, resulting in the shutdown, is a good example of a short term retarding of the economy via fiscal policy (congress controls fiscal policy). The stimulus checks during and after COVID were stimulative, and the last round overstimulated and contributed to inflation.

By the way I’ve never been a salesman, I’m retired now. My training was in economics and business, I spent a lot of years as CFO of a good size company that was very active in debt markets. I think I understand these issues pretty well, but I don’t claim to be an expert.


Edit: nothing against sales; it is a skill that would have served me well in my career but I never developed.

Man - it makes sense... this is written as a CFO or head of a company would write it... I wouldn't divulge what i do but I do know a thing or two about that

On a consumer level - I highly disagree - layoffs are currently hitting level we have not seen in 15 years, there is very little consumer confidence and growth continues to come from VERY few sectors. A lot of GDP growth came from the healthcare sector as well as AI buildout... inflation is down where? Vs estimate or vs prior year? Certainly not the latter which has deep meaning to consumers... I see consumer data reports and I see what is happening right now when consumers spend on core items. Interesting have done NOTHING for consumers, they've done a ton for investors and businesses...

ASAP wrote

Man - it makes sense... this is written as a CFO or head of a company would write it... I wouldn't divulge what i do but I do know a thing or two about that

On a consumer level - I highly disagree - layoffs are currently hitting level we have not seen in 15 years, there is very little consumer confidence and growth continues to come from VERY few sectors. A lot of GDP growth came from the healthcare sector as well as AI buildout... inflation is down where? Vs estimate or vs prior year? Certainly not the latter which has deep meaning to consumers... I see consumer data reports and I see what is happening right now when consumers spend on core items. Interesting have done NOTHING for consumers, they've done a ton for investors and businesses...

There’s an old saying/joke among economists that if your ask for an economic forecast from n economists you’ll get at least n+1 opinions. Do your own research, read your preferred sources and come to your own conclusions. No point in debating them.

On the jobs market, Brian put out this video today. I agree with many of his takes on the economy and stock market. Is frank and to the point while using available sources/data to back up his statements.

zx10guy wrote

On the jobs market, Brian put out this video today. I agree with many of his takes on the economy and stock market. Is frank and to the point while using available sources/data to back up his statements.

Pretty good summary of the data we do have. I read recently that the FED may be softly changing the inflation target to 3% (which makes a lot of sense for many reasons). This is based on some of the balance sheet moves the FED is making or has announced. If true, a rate cut in December is pretty certain - but as I stated in a prior post, my view is it is too little and too late. So I expect some bumpiness.

On retail jobs, this is not surprising because the long-term trend is still toward on-line shopping. Layoffs in Q4 are not uncommon - most retail hiring this time of year is temporary help for the holidays, not full time.

On the plus side corporate earnings in Q3 handily beat expectations with double digit profit growth. A few more still to report, but a pretty robust quarter. That suggests sales have remained stout, and reinforces the idea the layoffs have more to do with efficiencies (maybe supported by Ai) than poor business conditions.

Markets are not pricing in a recession or further significant rate cuts (after Dec), yet. They’re not always right, but it is a good indicator of how much weight each new data point actually gets by those placing their money on the line.

As I said in the earlier post, there is a lot of uncertainty now and it seems like the risks are all to the downside, but they are still risks and not certain.

Market is way overvalued, highly leveraged now.
There is ~1.3 Trillion $ in margin debt now.
Hindenburg omen was triggered week before last

But, there is probably going to be a short squeeze this week now that .gov will probably open soon and Bitcoin & Ethereum liked the news :-)
Market may rally year end then crash next year 30-40% now that the market is figuring the circle-jerk of the AI bubble.
Keep ≥15% cash and wait to deploy
Capital preservation very important
When the market is trading at the extremes, trade the opposite of the rest of the herd

I sold out all of my high gain NVDA and AMD at the recent ATH. Figured I was too exposed with VTI and VOO positions having high NVDA components.

Holding the money at HYSA and a bit of BND for now.

Re: retirement spending.

I recently helped my parents plan out their retirement budget, using rhe 4% rule they are shockingly comfortable in budget allocations, as someone else said you really do need to map it out because you dont need as much income as you think you do.

No longer saving for retirement (pretty big shift for most responsible retirees)
No longer paying FICA
Compounding any leftover money from not hitting your 4% draw rate

All 3 of those factors tend to mean you can retire with less than your brain tells you that you need.

Mech Spec wrote

I sold out all of my high gain NVDA and AMD at the recent ATH. Figured I was too exposed with VTI and VOO positions having high NVDA components.

Holding the money at HYSA and a bit of BND for now.

Re: retirement spending.

I recently helped my parents plan out their retirement budget, using rhe 4% rule they are shockingly comfortable in budget allocations, as someone else said you really do need to map it out because you dont need as much income as you think you do.

No longer saving for retirement (pretty big shift for most responsible retirees)
No longer paying FICA
Compounding any leftover money from not hitting your 4% draw rate

All 3 of those factors tend to mean you can retire with less than your brain tells you that you need.

I'm long on those stocks and will buy any big dips. I have thought of selling NVDA to load more PLTR or AMZN.

floridaorange wrote

I'm long on those stocks and will buy any big dips. I have thought of selling NVDA to load more PLTR or AMZN.

I was up like 5x so... easy call for me. The bubble will go at some point here since AI is not actually what people say it is.

Mech Spec wrote

I was up like 5x so... easy call for me. The bubble will go at some point here since AI is not actually what people say it is.

Yep and agree there is enough exposure through index funds.

ASAP wrote

I know this has been ad nauseam... but no one here thinks there is an actual correction coming?

If you discount the 7 companies that are consistently passing money amongst each other based on hopes of AI and other companies that are making profit based on major cost cuts - there is really nothing out there that's doing too well...

Layoffs are skyrocketing as well and all interest rate cuts so far haven't proved to result in anything. Not even going to get into the major political / tarriff turmoil.

I do. Back in April or May I moved ~70% of my portfolio into a MMA for exactly that reason. I'm not worried about missing the absolute peak, but watching things go up since has been a bit difficult to stomach. Still, like you, I'm sticking to fundamentals and what I perceive to be an inevitable correction needing to happen.

Mech Spec wrote

I was up like 5x so... easy call for me. The bubble will go at some point here since AI is not actually what people say it is.

5x is beautiful. Ive only invested what I can afford to lose, so Im letting it run through the peaks & valleys. Buffered by 2 slow growth mutual funds.

Wealthfront and chill. I don't have the stomach, time or desire to be actively in and out of stuff. I have automatic deposits into WF from my HYS account. When I see the market drop I increase the amount of my automatic deposits. If it drops a lot I might also deposit some extra manually. I've had too much cash sitting around so have been moving a lot more into my WF investment account. Also moved some out of HYS to their bond portfolio as I was reading about rate cuts coming for a while.

I don't know if this is the best strategy, but I think it beats not investing at all. Since I started with WF around 2016 I've been averaging about 16%/year. Just wish I had put more money in earlier on instead of sitting on cash.

Reborn_ wrote

I do. Back in April or May I moved ~70% of my portfolio into a MMA for exactly that reason. I'm not worried about missing the absolute peak, but watching things go up since has been a bit difficult to stomach. Still, like you, I'm sticking to fundamentals and what I perceive to be an inevitable correction needing to happen.

So you’re trying to time the market?

I don't know what to think anymore. I thought for the last 7 years that a major correction was coming. There was a big drop at the start of COVID, but that corrected real fast. More or less, the market has grown at a very steady pace. Inflation has been a big problem, no doubt, for the last 3 or so years. Everything is expensive. It's very easy for me to gauge this by reviewing my monthly CC bills over the past 4 years. We put everything on our CCs. Our spending hasn't changed much at all, but our monthly CC bill has gone up 20-23% compared to what we spent back in the 2021/2022. That's alarming, IMO.

Our portfolio has grown dramatically during that time and I've had some great raises to offset the rise in costs. I'm consider myself very lucky and fortunate, but I know that a vast majority of Americans are struggling and it's getting worse. There really a clear line and valley between the haves and have-nots.

Regarding the market, I read lots of stories about how bad the market is yet, I remain confused as it's continues the climb. I know that the market doesn't necessarily represent reality, but I remain perplexed by its performance.

I work in mergers and acquisitions and I've never been busier over the last 5 years compared to when I started back in 1998. We're turning down work which is crazy to me.

I'm on the Bogleheads forums a lot and that is one hell of an informed financial group. I don't read much in the way of those folks being overly concerned except for perhaps the ACA subsidies not being extended. Most assume a 15-20% correction at some point over the next few years, but not much in the way of doom and gloom.

The labor market is trash because of the current administration cutting 300,000+ federal jobs, tech firms cutting their over-hires, and to a smaller extent AI replacing certain jobs, etc. It will be interesting to see the job and financial impact of baby boomer generation retirements and deaths. Many have a ton of money and a many more don't have remotely enough to retire.

RickFLM4 wrote

So you’re trying to time the market?

Essentially, yes. But for me, it's no regrets. I'm still ~30% in (and growing) so that's enough exposure for me, for now.

Reborn_ wrote

I do. Back in April or May I moved ~70% of my portfolio into a MMA for exactly that reason. I'm not worried about missing the absolute peak, but watching things go up since has been a bit difficult to stomach. Still, like you, I'm sticking to fundamentals and what I perceive to be an inevitable correction needing to happen.

History shows that this is pretty bad approach to personal investing. Yes, you can lose a ton of money during a correction, but often times the recovery is swift and you'll come out way ahead. I've weathered all the financial corrections and downturns since 1999. I never once moved money. My biggest mistake was being ignorant to investing and selecting mostly high fee, high expense ratio, and actively managed funds between 1999 and 2015 plus having a financial advisor and all the fees that go with that BS. If I would have done S&P500 index funds and managed things myself a lot earlier, my portfolio would easily be 50%+ larger.

By sitting out since this spring, you've missed out on a lot of growth assuming you were in funds that matched or better the S&P500. My portfolio has grown by over 10% between April and now.

AI data centers require massive amounts of storage. As a result, companies that produce storage hardware, such as Micron, Samsung, etc. are likely to have steady revenue in the near future. Would these companies be good short-term investment opportunities?

2000cs wrote

The host was Louis Rukeyser; I don’t recall the guest but I’ve heard that advice several times in my investing life - never sell. However I’m getting increasingly anxious about 2026 politics and political strife given the inability or unwillingness of Congress to simply pass a CR and work on anything else, and of course the midterms. That creates uncertainty which is not good for the economy and the stock market, so I am selectively selling down to hold more cash (15% now going to 30% or more).

Contact the mutual funds you are interested in or the ones you hold in your deferred account to see about tax treatments. My understanding in general is that the holder (you) is not taxed on capital gains until they are paid (and some of their dividends are gains, some returns of capital, and some dividends as those terms are used in the tax code). In other words, you get cash but get somewhat favorable tax treatment. There are other investments like publicly traded limited partnerships that you can be taxed on your share of income whether paid or not, and some of them are taxable in part or whole if held in tax deferred accounts.

These days ETFs are more popular and more liquid than most mutual funds or CEFs, and there is such a great variety that they are worth spending some time to research. They can be held in a taxable account (SCHG is an example of one focused on growth with low dividends, so low taxes. Designed for appreciation so capital gains, not ordinary income) or tax deferred accounts (SCHD is a dividend ETF with a decent yield; SPYI or JEPQ are dividend ETFs that juice the returns with covered calls). I mention these not to recommend them but because they are popular, widely held, so there is a lot of info on them pro and con.

I have a some money in mutual funds in some brokerage accounts and the tax hit is minimal.

So far what's left after taxes of my RMD funds have been going into CDs. The returns are lower but tolerable. And the money provides a cushion should the market tank I can do a transfer in kind from my tax deferred accounts to my brokerage accounts and be well positioned for the recovery.

At some point when CD interest rates decline enough rather than take the RMDs as cash I'll just do a transfer in kind to my brokerage accounts and leave the money invested.