We Are in Bear Market


Glad to know somebody is recognizing his leader is irrelevant. He always was, and he always be. The swamp pulling his strings is another thing.

Oh, I thought he was going to drain it? :smiley:

Now, to the real news:

President Donald Trump’s debt sales will surpass levels last seen when the U.S. was digging out of its worst economic crisis since the Great Depression. The difference is, this time the economy is booming.

The debt issuance at this quarterly refunding beats the previous record of $81 billion first set by former Treasury Secretary Timothy Geithner in 2009 when the U.S. was recovering from the Great Recession. This time borrowing is surging as the economy hums along at a 3.5 percent annual growth rate and unemployment is near a half-century low.



-40B MoM in margin could be the driver for the decline? Anyone tracking fund flows? @Jil?

Stock-Market Margin Debt Plunges Most Since Lehman Moment | Wolf Street


We are well aware of this forced selling phenomenon.

Forced selling is not the trigger of a decline but is the one that cause a decline to be deeper than if there is no forced selling. One effect of forced selling is…

At the time, these stocks soared by stunning amounts, and people, such as myself, used margin debt, to enhance their returns. When stocks plunged, the margin calls came, and these people had to sell their holdings into an illiquid and plunging market. They ended up selling their best and most liquid stuff first and watched their trash get trashed further.

AAPL is extremely liquid, both underlying shares and options. So many investors who got margin calls are forced to sell AAPLs. Is why Jil is very puzzled why AAPL having a strong earnings and yet still drop. Hence, is ok to buy fundamentally strong stocks like AAPL now.

Finally, we want to flush out those weak margin investors, we know they are flushed when we have a market capitulation. A sharp decline in prices with high volume that reverse the next day.


“Weak margin investors”: would that be Manch? Has he capitulated yet?


No, not capitulated yet. You guys can all suck your thumbs and DIE



Did you reduce your margin usage to 2:1?


Stock has touched bottom on Oct 10 (lowest), then went up again came down Oct 29th, went up and came down Nov 20th, resulted margin call triggers.

Margin calls triggered every stock including AAPL.

When such things happening, nov-dec period (with government shutdown, hanging government, fed rate hike talks), it continues downward trend, we land up into 20% bear market.

We are current at 9.1% level in broad market, but all techies (FAANGs) crossed down more than 20%.

This has been like than since last 45 days and volatility may be there another 45 days until Dec 31, 2018, we have one full qtr down.

It is horrible at this stage.


Three Kudos !!!


All I understand is people questioning “Why panic now to others than providing some justification for hope or some justification/proof how market will come up?”

What and How will the market turn differently now, when fundamentals are positive and market sentiment is deep negative !


That means people are being irrationally pessimistic. Expect a strong reversion upwards.


Everyone cares so much about Manch. Let’s wish him a big Santa Claus rally! He can magnify Santa Claus by 10x :rofl:

I just hope Santa Claus will also lower interest rate a lot. Powell is ruthless to all you guys


triggered margin calls, not margin call triggers :slight_smile:
Few ways to trigger margin calls,

  1. Professional shorts did it intentionally
  2. Liquidation of a large hedge fund for whatever reasons
  3. Horrible news such as PCG possible bankruptcy


Is pessimism extreme yet? If not extreme, the re-bounce could be DCB, technical re-bounce or bull trap :slight_smile:


Professionals are cruel. Once they smell blood, they won’t buy at fair value. They would do what WB does, 30% below intrinsic value (just an illustration). As small retail investors, we can try to tailgate them or just ignore them and buy & hold (strong fundamental stocks). So long you’re not too aggressive i.e. minimal or zero use of margin, you should be ok, and invest only with spare (i.e. not need to be use for the next few years) money. If you can’t sleep well, you are over-exposed, sell some till you can sleep even if sun doesn’t rise (j/k).

The keys are: strong fundamentals, and spare money.


Doesn’t matter. Might take a few days or might take months. Final result is the same.


Drawdown from peak :cry: :

Facebook: 40%
Apple: 26%
Amazon: 27%
Netflix: 39%
Google: 20%


People are acting as if the world fell apart already. Incredible discounts.


Not many have the right personality to be in stock market.