Stock Market/Investing/Day Trading/Speculative Trading Thread

[KidsSeeGhosts]

I'm not trying to specify what the reasons behind inflation are. I think @BingoDingo probably has it summarized as well as you can from a birds eye view and in a couple of paragraphs.

I'm just arguing that corporate profits are not a cause of inflation. They're a result.

They certainly can be, and are to some extent, but impossible to identify whether it's meaningful or statistically relevant w/o access to every FP&A group's excel instance.

 

[BingoDingo]

Kind of asking and answering different questions though. I would love to see the author's math b/c I don't know how you possibly begin to isolate corporate profits as a variable. More compelling point IMO is inflation in production expenses is quite a bit lower than the inflation in ultimate consumer costs.

Non-IVA/CCA Adjusted post-tax profits are part of the Quarterly BEA GDP report.

 

[Jim14510]

They certainly can be, and are to some extent, but impossible to identify whether it's meaningful or statistically relevant w/o access to every FP&A group's excel instance.

Agree to disagree. A bit semantics maybe. A corporation's goal every year is to maximize profits. I don't know how you can look at a period in time and say "The corporations maximized profits too much during that time and that's why prices increased."

Nobody is looking back at a period of deflation and saying the reason for the deflation is because corporations didn't maximize profits enough.

 

[BingoDingo]

They certainly can be, and are to some extent, but impossible to identify whether it's meaningful or statistically relevant w/o access to every FP&A group's excel instance.

No, that's not true at all.

 

[KidsSeeGhosts]

Non-IVA/CCA Adjusted post-tax profits are part of the Quarterly BEA GDP report.

You're for sure more knowledgeable on than me, so correct where I stray. My point is similar to yours in that there are too many dependent variables in the system to really isolate the delta of opportunistic price increases above and beyond commodity and other input increases.

 

[BingoDingo]

You're for sure more knowledgeable on than me, so correct where I stray. My point is similar to yours in that there are too many dependent variables in the system to really isolate the delta of opportunistic price increases above and beyond commodity and other input increases.

Well, to the extent that omitted variables introduce bias to the underlying model, yes...but you can test/correct for those issues relatively easy. If you are modeling the relationship/treatment effects, you are not trying to capture all the variables that have any interaction with your independent variable...you're trying to select the best group of variables that explain the most amount of variance in your target variable(CPI) in a statistically/robust way, given the time continuity of your series. You aren't calculating the actual impact - you're estimating it..and it's just hard to imagine that a variable with nearly no correlative relationship that explains, at most, 5% of the variance in CPI even when using lagged effects would ever give you any significant effect on inflation (because profits are a product of consumption...consumption isn't a product of profits....at least not directly). Either way, you shouldn't use after-tax profits as a dependent variable anyways...lol

 

[LoudHogRider]

Non-IVA/CCA Adjusted post-tax profits are part of the Quarterly BEA GDP report.

If you could just use a few more acronyms ...

 

[cwessel76]

If you could just use a few more acronyms ...

 

[BingoDingo]

If you could just use a few more acronyms ...

In the world I've created in my own head, everyone knows about consumption and inventory adjustments...

 

[Jim14510]

Well, to the extent that omitted variables introduce bias to the underlying model, yes...but you can test/correct for those issues relatively easy. If you are modeling the relationship/treatment effects, you are not trying to capture all the variables that have any interaction with your independent variable...you're trying to select the best group of variables that explain the most amount of variance in your target variable(CPI) in a statistically/robust way, given the time continuity of your series. You aren't calculating the actual impact - you're estimating it..and it's just hard to imagine that a variable with nearly no correlative relationship that explains, at most, 5% of the variance in CPI even when using lagged effects would ever give you any significant effect on inflation (because profits are a product of consumption...consumption isn't a product of profits....at least not directly). Either way, you shouldn't use after-tax profits as a dependent variable anyways...lol

That's a whole lot of words to say corporate greed isn't a cause of inflation.

 

[Toe]

https://www.cnbc.com/2024/01/30/worlds-no-1-shipper-pleads-with-congress-to-help-end-houthi-chaos.html

 

[Frogsker30]

https://www.cnbc.com/2024/01/30/worlds-no-1-shipper-pleads-with-congress-to-help-end-houthi-chaos.html

I read that link as worlds no 1 Sniper

 

[Toe]

 

[God is a Husker]

Boys should we create our own farm stocks basket and bet on the Agriculture lobbyists + Space Troll Elon ?

DE
CNH
BAYR
CTVA
ADM
SMG
NTR
CAG


yeeeeee haaaaawwwww (seed) drill baby (seed) drill!

 

[Jay Bilzerian]

Boys should we create our own farm stocks basket and bet on the Agriculture lobbyists + Space Troll Elon ?

DE
CNH
BAYR
CTVA
ADM
SMG
NTR
CAG


yeeeeee haaaaawwwww (seed) drill baby (seed) drill!

That portfolio backtest not so sexy on this one

 

[BingoDingo]

 

[BingoDingo]

Damn!

 

[LoudHogRider]

Damn!

No rate discount for you!

 

[Toe]

Commercial real estate feels like a trainwreck in slow motion. Sure hope it doesn't turn into a trainwreck in fast motion....

Commercial real estate a 'manageable' problem but some banks will close: Powell

Federal Reserve Chair Jerome Powell is predicting that more small banks will likely close or merge due to commercial real estate weaknesses, but that the problem is ultimately "manageable."

finance.yahoo.com

Wall Street worries banks aren't worried enough about commercial real estate as NYCB turmoil mounts

Regional banks have been setting aside money to deal with future losses on commercial real estate, but in the wake of problems at New York Community Bancorp some analysts now fear it hasn't been enough.

finance.yahoo.com

Regulators are now "pumping the phones basically asking, ‘What does your commercial book look like?’" Chris Whalen of Whalen Global Advisors told Yahoo Finance.

The concern regulators have, Whalen added, is that higher commercial real estate exposure could get banks "tarred and feathered" by investors.

"What really annoys us about NYCB and other banks with commercial exposures is that they knew months ago that the OCC was demanding pre-emptive increases in capital and loan loss reserves," Whalen said in a separate research note.

"Why? On the assumption that some commercial property valuations in the $20 trillion market are in a free fall and that, accordingly, defaults will spike in 2024."

Powell acknowledged in his "60 Minutes" interview that some smaller banks will "have to be closed" or merged "out of existence" due to losses tied to the falling values of properties across the US that are suddenly worth much less due to the Fed’s elevated interest rates and the effect of a pandemic that emptied out many city-center buildings.

But "we looked at the larger banks' balance sheets, and it appears to be a manageable problem," Powell said.

"There's some smaller and regional banks that have concentrated exposures in these areas that are challenged. And, you know, we're working with them. This is something we've been aware of for, you know, a long time, and we're working with them to make sure that they have the resources and a plan to work their way through the expected losses."

What do you think, manageable problem, or is this just Fed-speak from Powell?

 

[BingoDingo]

Remarkable stuff...