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Thread: Bond Market

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    MisterVeritis's Avatar Senior Member
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    Bond Market

    Consider here that the value of the US bond market is about $51 trillion.

    Thatís more than 1,100 times the total capitalization of the US stock market. Thatís right, the bond market is 1,100 times bigger than the US stock market!

    https://peternavarro.substack.com/p/...hind-the-stock

    This caught my attention.

    The US is unable to sell its bonds. I have unrealized losses probably approaching $50,000 in one of my accounts. Meanwhile, despite the slowing US economy my stocks are increasing in value. I think many people and organizations are taking their losses on the bonds and putting that money into stocks.

    I have started moving my money into American silver coins. I think the US economy is in really big trouble.
    Call your state legislators and insist they approve the Article V convention of States to propose amendments.


    I pledge allegiance to the Constitution as written and understood by this nation's founders, and to the Republic it created, an indivisible union of sovereign States, with liberty and justice for all.

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    I don't think the upward trends in the stock market will hold up much longer. Next year could be really ugly!
    My Revenge will be Success! - Donald J Trump

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    My military TSP has bonds in it. I should probably move them into the other options.
    ΜOΛΩΝ ΛΑΒΕ


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    Prices in both bonds and stocks are hyper-inflated. It's pretty much a captive market for both, much less for bonds than stocks. It's mostly institutional investors playing musical chairs with each other. Insurance companies alone own some 40%-50% of bonds, and in the case of the stock markets institutions own over 80% of stocks, at least they make over 80% of trades anyway, which is why it's ridiculous to claim the stock markets represent real economies. Retail investors pay highly inflated prices for both bonds and stocks, and are a small part of the financial markets. The giant elephant in the room is that Corporate debt and consumer debt dwarf govt. debt, but only govt debt is supposed to be bad according to the GOP shills, which is why I don't put any more stock in right wing GOP economic fantasies than I do left wing fantasies.
    Last edited by Chuck; 01-09-2024 at 02:51 AM.

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    Quote Originally Posted by Chuck View Post
    Prices in both bonds and stocks are hyper-inflated. It's pretty much a captive market for both, much less for bonds than stocks. It's mostly institutional investors playing musical chairs with each other. Insurance companies alone own some 40%-50% of bonds, and in the case of the stock markets institutions own over 80% of stocks, at least they make over 80% of trades anyway, which is why it's ridiculous to claim the stock markets represent real economies. Retail investors pay highly inflated prices for both bonds and stocks, and are a small part of the financial markets. The giant elephant in the room is that Corporate debt and consumer debt dwarf govt. debt, but only govt debt is supposed to be bad according to the GOP shills, which is why I don't put any more stock in right wing GOP economic fantasies than I do left wing fantasies.
    Insurance companies own about 10% of stocks by this chart.

    Stock-Ownership_US.jpg


    20% of the bonds


    corpbond_1-1-209923121.png
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    Bonds at a premium: The impact of insurers on corporate bond issuers


    https://cepr.org/voxeu/columns/bonds...e-bond-issuers

    insurance companies, premiums and bond investments

    I use data on more than 1,500 US insurance companies to identify shifts in their bond demand. Insurers hold nearly 40% of US corporate bonds (Figure 1). Their primary source of financing is insurance premiums from households, i.e. payments made by policyholders for protection against losses caused by events such as car accidents or windstorms.

    They have a nice graph, too.

    And, doesn't refute the percentage of stocks owned by institutional investors. As for all the rest ... small potatoes.

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    The stock market has a needle in their arm and their heroin is US deficit spending. US GDP growth under Biden is equal to the US deficit.
    If you want to see the market crash then just announce that we are going to cutting spending. Wall St has plans for our money, in China.
    Let's go Brandon !!!

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    Quote Originally Posted by RMNIXON View Post
    I don't think the upward trends in the stock market will hold up much longer. Next year could be really ugly!
    Why?
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    Quote Originally Posted by Chuck View Post
    Prices in both bonds and stocks are hyper-inflated. It's pretty much a captive market for both, much less for bonds than stocks. It's mostly institutional investors playing musical chairs with each other. Insurance companies alone own some 40%-50% of bonds, and in the case of the stock markets institutions own over 80% of stocks, at least they make over 80% of trades anyway, which is why it's ridiculous to claim the stock markets represent real economies. Retail investors pay highly inflated prices for both bonds and stocks, and are a small part of the financial markets. The giant elephant in the room is that Corporate debt and consumer debt dwarf govt. debt, but only govt debt is supposed to be bad according to the GOP shills, which is why I don't put any more stock in right wing GOP economic fantasies than I do left wing fantasies.
    No sane person has ever claimed markets are rational. You cannot have rational price discovery with irrational or ignorant players.

    The markets are not all about EPS etc. They are about the inflows from the 401k truck dropping money to them every week. Stocks also are priced in relation to other asset classes competing for the same capital. What do stocks have that really can compete with them ? Gold? Gold has no reason to do anything but sit where it is while the cost basis to owners of gold risd every year. The loss of use of capital is what the same money could earn in income every year. Lets say you bought gold at 2000. Assume you gave up an average of 10% returns elsewhere because that's exactly what you just did.

    Iow every year add 10% to your cost to understand what you really have in it. At 10% one would have about 4000 an ounce cost in the gold in 7 years. A loss of 50%. In another 7 years you have the equal of 8000 cost in your ounce of gold .in the real world gold offers a negative return of around 10% per year. So in reality gold is about the worst place to put money.

    It makes buyers feel warm and fuzzy is all. Nobody is going to need to buy condoms with gold pieces.

    But what do I know ?

    I was only an investment broker for 27 years and have over 50 years trading experience.

    If one doubts my wisdom gained from the aforementioned go back in time a bit. Of all the posts etc about markets etc over the 5 years I've been here that I've made in regards to any market not a single one has been wrong or missed thecmark.

    Not one. If you think I'm full of it find an instance. You won't because it does not exist


    In the asset class averaging 10% one could take the same 2000 and its worth 4000 in 7 yesrs . A 100% gain.
    Thats why gold offers no competition to other asset classes and exactly why only financial illiterates swear by it

    There is no magic to understanding the markets. It's really just a simple game played with numbers

    Understanding numbers what you have to have to understand markets and of course a bit of knowledge about the psychology of humans helps
    Last edited by Cotton1; 01-09-2024 at 08:32 PM.
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    Quote Originally Posted by MisterVeritis View Post
    Consider here that the value of the US bond market is about $51 trillion.

    That’s more than 1,100 times the total capitalization of the US stock market. That’s right, the bond market is 1,100 times bigger than the US stock market!

    https://peternavarro.substack.com/p/...hind-the-stock

    This caught my attention.

    The US is unable to sell its bonds. I have unrealized losses probably approaching $50,000 in one of my accounts. Meanwhile, despite the slowing US economy my stocks are increasing in value. I think many people and organizations are taking their losses on the bonds and putting that money into stocks.

    I have started moving my money into American silver coins. I think the US economy is in really big trouble.
    Actually the US stock and bond market show a market cap of 51 trillion bonds and 46 trillion stocks a10% difference
    I'm yo.
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