dmp said:
Amazon, Google and Facebook face continuing anti-trust challenges from Governments. What used to be tech companies are now retail, advertising, and advertising. Will be interesting how it plays out.
Yes I might trim some google too... I never liked facebook (I sold my apple in the 80s, wish I didn't). Right now the index investing is lifting the big cap FANG stocks (facebook, apple, netflix, google).
Crypto currencies that do not have a central authority will be nearly impossible to regulate.
and likewise impossible to value. A matter of trust until something happens to lose that trust. I still don't see the intrinsic value. While my small gold position is only down 10% now, was down more than 20% before. Inflation should help that too.
They are worldwide, distributed networks. Countries with higher levels of freedom, like the US, will be the least likely to go on the offense, especially now that they are so pervasive in the national conscious. Time will tell how disruptive they become. I doubt they will destroy the USD.
Bitcoin will more likely challenge credit cards... Square (payments company) has already expressed interest in crypto, it would be smart of paypal and maybe card companies to incorporate it (blockchain).
It seems these fears are mostly with the tinfoil hat crowd.
fear is mostly from people trying to protect their personal wealth with virtual currency, these would be in China, Korea and lots of trading activity in Japan. I think S. Korean government has already made noises about restricting it, china already has capital flows restrictions.
The US has been pretty receptive so far.
Hopefully, countries in the near term pass a exemption on spending that exempts from capital gains. A $600 exemption was floated in the US at the end of 2017.
why? It seems like trading profits from a cryptocurrency should be taxed just like buying and selling gold or securities?
Maybe I should start a crypto index. Anyone want to buy? (j/k)
your late to the game, initial applications for ETF were rejected, but now that some exchanges are selling futures contracts they are reapplying for bitcoin ETF... Many people (like me) think it is a bubble, but some serious investors are trading around the rapid increase. There is much money to be made while it keeps going up and it could do that for a while longer. I am not smart enough to time it. (I can't even make a profit on gold :
).
At some point, the economy will start to slow down again and the high value stock market will pop. With so much leveraged trades now I expect the stock market crash could be pretty spectacular (you can buy leveraged ETFs in any brokerage account now!)
We are way past due for a market correction. I can't recall going this long without one, but I think perhaps the rapid trading algorithms are buying the dips, and index investing is reducing volatility. But after a correction which is likely a buying opportunity, the market is expected to be up for 2018 too.
More likely scenario is economic stimulus from tax cuts and offshore repatriation of retained earnings, will heat up inflation causing the central bank to finally raise interest rates higher. Most (all?) economic contractions are directly caused by central bank tightening. In fact the historical bull market "was" driven by central bank easing and injected liquidity, but they are now withdrawing liquidity (here at least, europe is still easy). The near term market rise is driven by corporate earnings that just got a huge boost from tax law changes.
2018 looks good for now, but nothing goes up to the sky so eventually they will kill this golden goose market.
Many will be fighting to find a chair then.
bitcoin is more likely to be a bubble that bursts suddenly than the stock market... A HUGE drop for the stock market is 20%, (black monday in 87 was -22%) bitcoin swings that much with the weather.
The crypto space has that going for it - much less investing on margin.
in fact the few firms trading bitcoin futures have significant margin requirements to discourage using so much leverage
The improved earnings in 2017 caught me by surprise and now it seems the bull market has a few more years. But time will tell.
Yup, I would still buy the dips in 2018.
JR
PS: It seems like slow money is finally catching on to index investing (i worry that this too can cause distortions since individual stocks are not being bought/sold on merit). Warren Buffet just won his million dollar bet that an index fund would outperform a basket of hedge funds over 10 years, so smart money is not that smart. If i was smarter (braver) I would trade options that are cheap because of the unnaturally low volatility, but this won't last forever and I am getting too old for risky investments. Stocks are already risky enough.
