darn, not looking up how much a ticker cost could’ve been quite the missed opportunity
Anyone have ideas on companies to short? I’m already short ZM, LCID, TSLA, DASH, UBER, QS, RBLX, NKLA, and will most likely short Rivian when it goes public.
Shorting Tesla seems like a bally move, there’s so much irrationality going on with that stock.
Yeah and I’m prepared to wait out the irrationality for a while if necessary. I shorted at 701 and I’m fine with it climbing to 1k before falling to reality. In fact I hope it does hit 1k because then maybe my FIL will be willing to take some/all of his profits.
The EV sector in general is bonkers. Rivian is expected to IPO with a valuation of 80 billion–a bigger market cap than GM without yet having sold a single vehicle. I do think they’re a legit company that will make and sell nice trucks, but come on. Lucid dropped recently but still has a market cap of 30b, equal to Kia’s. They, too, have yet to produce a single vehicle. Nikola is a gravity-powered truck company that still has a market cap >4b. Lordstown (RIDE) was another fraud. QuantumScape is supposed to be a solid-state battery company but it’s a scam. Though a scam, its market cap is >9b. Romeo Power (RMO) is a few guys in a garage, but it took a while for the price to reflect that.
Today was the end of the lock-up period for insider selling of RBLX shares. I expected a dip, but there wasn’t much of one, which might be bullish so I covered. (Or maybe the end of the lock-up was priced in, but it sure wasn’t for LCID, which dipped 24% in the Sept 1 pre-market.)
Diamond-handing my TSLA short of course. Thisisfine.jpg
I’m like 95% sure the TSLA short will be correct in the long run but it might take 15 years! Also as long as they can just keep selling stock at this valuation they’re fine in perpetuity. I’m sure they’re super expensive but I’d prefer long dated puts.
Anyone with experience with any of the vanguard inflation protection funds? Looking for a safe place to park the EIDL money to offset the interest rate (3.75%).
Inflation funds seem like the opposite of what you want, or at least irrelevant for your goals - isn’t the 3.75% interest rate fixed?
There’s nowhere to get a “safe” return of 3.75% when 30-year bonds are yielding less than 2%.
Safe is relative I suppose. It doesn’t have to be perfectly safe. Fwiw the prospectus lists it as “2” level of risk on a 1-5 scale.
I wouldn’t characterize a bond fund as “safe” in the current market. A typical inflation protected bond fund (or any high quality bond fund for the most part) will have a yield less than 1% net of fees and taxes, and to get that you carry interest rate risk because a rise in interest rates will result in a capital loss on the ETF units. I think you’d actually be better off shopping around for the most favorable high interest savings account if you might need the money in the next, say, 24 months.
But inflation is, if I understand it correctly, irrelevant to you. So you shouldn’t be looking to protect against inflation.
A common scenario is where a retired couple wants to make sure they can continue to pay for groceries, housing expenses, etc. Because those costs fluctuate with inflation, they want to protect against that risk - they want to make an investment that pays off more when inflation is high (because they’ll need the extra return to pay off their higher costs) and less when inflation is low (the lower return is fine because it will be sufficient to pay the lower costs).
In that scenario, an inflation-protected investment makes sense. But your case is different - you are going to owe 3.75% on that loan regardless of what inflation does. If you buy an inflation-protected security, you’re actually choosing to take on risk because you’re intentionally buying something with greater nominal payoffs when inflation is higher and lesser nominal payoffs when inflation is lower, even though your cost (the 3.75% loan) is the same.
Now, maybe this makes sense as part of an overall asset allocation strategy, but if you’re mentally tying it to the loan, then I think you should be actively avoiding inflation-protected securities. (Plus what @mosdef said.)
Last year I moved about half of our fixed investments to an intermediate TIPS fund and we got almost 6% (nominal not real) in the first 12 months. I wasn’t sure it was the right move, but it worked out so far over the first year anyway.
Thanks. Good things to think about. The first function of the money is a Covid hedge over the next 1-3 year time frame. Locking in access to “cheap” money so to speak.
Once the money is fully assigned to the allowed spending categories then it becomes a lot more flexible.
Heck if inflation does spike and truly safe interest exceeds 3.75 then it’s a win in itself.
No opinion on the companies but redditors sure love the space stonks, RKLB being their current pet.
Not exactly a space stonk but I have some ASTS shares. They’re trying to launch a satellite phone internet service that will work with your existing phone and provide data coverage in remote places. It’s a longshot but priced accordingly. There won’t be market-moving news until next year, but the symbol is gradually gaining attention on reddit.
1 Like
This seems pretty dumb? There is nothing wrong with buybacks, the problem is shoveling money to firms that do buybacks when they go broke.
Like, I get that dividends are taxed as ordinary income so there is some tax arbitrage here, but what exactly is the point of this? You’re just going to encourage companies to not return money to shareholders, which I guess is fine if you think that will result in increased investment or whatever, but I would bet heavily on “increased executive compensation” over “increased investment” actually happening.
To the extent the point is to raise money, just (wait for it) TAX RICH PEOPLE MORE.
Or just stop pretending that capital gains are some kind of magical beast that must be taxes lower than interest or dividends.
2 Likes
I think this is the result of the real power being private business owners. Obviously huge publicly traded corporations get tons of press and people rightfully hate them for being terrible, but at the end of the day the people in charge of the firms usually don’t have their own money at stake. Like I’m sure Tim Cook and the Apple board care about this and don’t like it, but Tim Cook has only an indirect financial interest in the policy outcome.
Contrast this with Koch Industries or Cargill or whoever (and these people, not coincidentally, are the truly massive donors). The tax proposals at issue directly influence their bottom line, and it is most certainly their own money at stake. They’re just far more motivated and are subject to much less disclosure (thanks Justice Roberts). Look at the lobbying power of car dealers, for example. It is a pretty small industry that has completely captured state legislatures and congress. They’re so motivated because the laws mean millions of dollars a year to them personally.
1 Like
Someone yesterday morning posted a DD about some bonus employees will get if the price is at least $20. Sure enough, the apes read that and bought it up to $21 and change. I can’t see RKLB going away soon on WSB. Can easily see it pulling an AMC in the next few weeks.
As for top symbol mentions, you have to filter out the obvious shill spam garbage like CLOV. I don’t think I’m the only one ignoring all CLOV posts there.
I shorted AMC just now at $51, looking to cover around $30 and am prepared to wait a while.
It would have been a lock to short GME or buy puts on/before earnings day but I wasn’t paying attention. It’s still not a bad idea to short it long-term but I’ll wait for a better spot. My diamond hands have enough of a workload with TSLA.
I like how Ryan Cohen had to explain to the apes that a company can’t issue dividends when their net profit is negative (and NFT dividends are no exception). But IMO he should still issue them, grant the shareholders their wish. Negative profits = negative dividends, make the shareholders pay Gamestop. A stupidity tax, if you will.
1 Like
At publicly traded companies the people with direct stakes are the tax department. They add literally zero value to the organization other than identifying and acting on tax arbitrage situations. If tax rules change to reduce those situations then the lawyers and accountants in tax are looking at layoffs and/or less pay and/or obsolescence. Not a fun range of outcomes.
So last week I finally decided to start moving some of my too-large emergency fund/cash position into the market. Don’t believe there has been a positive day for the S&P since!
1 Like