Wall Street -vs- Main Street: Reality Sell-Off Underway….

The NAFTA sell-off is underway.  Relax.  No big deal.  The “NAFTA Reality Correction” is approximately 5 to 7%.  Multinationals hold greatest exposure. Everything is temporary.

(LINK To Story)

Twists and turns as Wall Street paper economy shifts toward ultimate equilibrium with Main Street real economy.  Real company P&L results (MAGA) will eventually replace speculative stock valuations.  Volatility is the norm while navigating the space between.

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179 Responses to Wall Street -vs- Main Street: Reality Sell-Off Underway….

  1. dufrst says:

    People don’t realize that a lot of money was made today by traders, brokerage houses, insiders, hedge funds and market makers. People don’t just make money when market goes up!

    The market is reacting to fed chairman taking the helm and to some extent to NAFTA. I think the big deal is the economy’s performance. It’s on fire! The ISM number today I hear was an all time high! Employers are hiring and wages are rising. The tax cuts start to show up in people’s checks this month and of course the bonuses keep getting paid out. This is going to be a blockbuster year! Perhaps 4% plus growth. The Dow will be at 30K come year end. MAGA!!

    Liked by 9 people

    • dufrst says:

      Record high!

      Liked by 7 people

    • thedoc00 says:

      I agree with you, on all points. What people also do not realize is that the Market never really bottomed nor rebaselined after the big drop in 2009. For 8 years business people, NOT economists, kept saying the Fed was creating a much larger problem that would have to faced eventually, with all their actions to help Obama. That is why I am no big fan of Yellen’s. Trump’s actions actually forced real live financial factors and considerations back into the US market, which have been ignored for the past 8 years. The market will rebaseline and move forward based on those factors.

      People also do not realize that the US consumer comprises over 40% of the input to the world wide market. That is why NAFTA and TPP shocks had such a major impact.

      Liked by 3 people

    • Carrie2 says:

      dufrst, and it a small percentage in any case, but the fake news can’t help themselves in trying to scare people. 7 times it has gone up and after this drop it is still over $24K, and you are right there are those who make money when down and when up. People look it as gambling but it is really a well-oiled and organized way for the smart people to always make money whether the stock market is up or down. Time for people to stop thinking so much of money and start thinking about helping others with the money they already have at hand. You can’t take money with you when you pass away, but some think that without a hunk of money they won’t be happy. Yet, I know nuns and monks who don’t have money concerns and yet survive and continue to help others because God takes care of helping them to help others, and that is how we need to think. I am not knocking having money because we all want to live well, but again so do those without enough money.

      Liked by 4 people

    • snellvillebob says:

      It started the day down 550 points and within 30 minutes went up 900 to 350. It was amazing. The ticker looked like my motorcycle speedometer with an electric drill hooked up to it when rolling back the mileage when I was 13.

      Liked by 2 people

  2. JAS says:

    Never, EVER, look at points up or down, look at percentages. Points are for media news, percentages, that’s not news :).

    Liked by 1 person

    • JAS says:

      Great example on FOX. Here’s the headline:

      “Stock market plunges, with Dow down a record 1,175 points in the Big Board’s biggest one-day drop”

      And the pic shows a broker looking like he’s ready to jump off the building.

      THEY NEVER TALK ABOUT PERCENTAGES!

      Liked by 1 person

  3. duchess01 says:

    The 1% Get A Scare — More To Come?

    February 05, 2018
    by John Rubino, Dollar Collapse:

    https://www.sgtreport.com/articles/2018/2/5/the-1-get-a-scare-more-to-come

    World’s Richest People Lose $68.5 Billion in Stock Selloff

    The fortunes of the world’s 500-richest people dropped by $68.5 billion Friday as equity markets swooned with investor worries about the pace of interest rate hikes in the U.S. Warren Buffett led the declines, shedding $3.3 billion to end the day at No. 3 on the Bloomberg Billionaire Index with $90.1 billion. J

    Like

  4. PgtSndThinker says:

    I look at the stock market the same way I do a herd of horses. ANY change, any noise, any unfamiliar movement or odor is cause for alarm. They often react first by running away, then evaluate from a safe distance. How fast do they run? 🙂 Ask any rider who has ended up on the ground because the horse moved out from under them like greased lightning.

    Liked by 1 person

  5. thluckyone says:

    movie reference: “Trading Places” – “Mortimer, we’re RUINED!!”

    Liked by 1 person

  6. H.R. says:

    I have a dividend-paying Main Street portfolio. Yup, I took a hit Friday and today. I’m down about 1.5%. I’ll still get the same dividends regardless of the stock price. I can afford another 10%-20% drop before I’m back to what I paid for the stocks. On a couple of dividend-paying stocks I inherited, I can afford a 95% drop before they reach their purchase price.

    I really don’t comprehend buying tulip bulbs. I want shares in a company that makes things, sells them at a profit, and shares the profits with the shareholders. I’m just not into the next hot stock offered on the Wall Street Casino.

    Liked by 1 person

    • Janeka says:

      If it doesn’t pay dividends I don’t want it.. When I lose $1,000 in market value yet I make $5,000 per year in dividends off the same stock I’m good. Over the years I’ve picked up several blue chips purchased at less that 10% of their current market value.. I made more $ in January 2018 than I did from 2012 to October 2016.. Profit taking it a normal trend from January thru April across all sectors.. Yes please.. Buy American made it helps me a lot

      Like

  7. Michael says:

    DW came home from work (wealth management) and says they were all watching the fall and the drop(s) came soooooo close to hitting the curb but then would recover a few points.

    One could be forgiven wondering if this was an intentional act.

    Liked by 6 people

  8. William F Buckley's Ghost says:

    Wages rose in America for the first time in thirty years thanks to President Trump and two Obama appointees to the Federal Reserve Yellen, today, and Kaplan on Friday decided to pound the table for high interest rates to derail everything President Trump has accomplished. Make no mistake this was a completely political attack on MAGA. Remember, the law of supply and demand does not cause inflation. If workers wages increase because of increased demand for workers it is a normal economic cause and effect. That a higher demand for workers is infationary is a myth used to justify the Federal Reserve’s political agenda. What’s wrong with prosperity?

    Liked by 2 people

    • dagnyshrug says:

      We’ve been in for a correction for a while. Many say the market has been overbought for only two months. If you look back, the tipping point was about a year ago. When the dust settles we’ll rebuild on a solid foundation. The fundamentals are there.

      As a retired mortgage banker I’m a little worried about the housing market, but only a little and only short-term. Housing prices and mortgage interest rates are rising faster than salaries, but salaries will likely catch up before there’s enough inventory to seriously hurt housing starts, or cause a significant decline in home values.

      Fixed rate mortgages have been so low for so long there aren’t a lot of adjustable rate mortgages out there (unlike 2007-2008), and years of tighter borrowing standards means there’s not a lot of junk paper out there either.

      Like

  9. milktrader says:

    Anyone watching overnight Dow futures, we’re down another 571 points from the close. That’s about 11% drop in 3 trading days.

    Fear is being injected in spades. Watch VIX hit 50 tomorrow.

    Believe me, I don’t want this to happen just making observations.

    Like

  10. milktrader says:

    Well, now we’re 720 points down …

    Like

  11. Troublemaker10 says:

    Why the stock market is selling off, explained
    https://www.washingtonpost.com/news/wonk/wp/2018/02/05/why-the-stock-market-is-selling-off-explained/?hpid=hp_hp-top-table-main_wb-marketexplainer-645pm%3Ahomepage%2Fstory&utm_term=.8a0a5a0c6fd2

    Excerpt:

    The bottom line is: The economy is doing well but stocks might not race up from here. To sum up, the stock market dip looks like an overdue reality check on how high prices were on Wall Street. That’s healthy. The decline of 1,175 points on Monday is the biggest single-day point drop in history, but in percentage terms, it doesn’t even make the top 50.

    The U.S. economy also still looks to be in good shape. Yes, there are concerns about inflation, but they have yet to materialize.

    Liked by 2 people

  12. milktrader says:

    Overnight markets are going bonkers.

    Like

  13. milktrader says:

    Down 850 … where’s the Fed? Buy some damn futures!

    Like

  14. Pam says:

    Like

  15. Pam says:

    Like

  16. HankM says:

    I didn’t think it was politically wise of Trump to brag about the record highs in the stock market that is essentially a Giant Casino where gambled money can grow exponentially or be lost in a day or 2.

    The super wealthy and experienced investors and hedge fund managers made more mega fortunes with this record fall because they know the market indicators well, when the market has out paced reality and when to buy low and when to sell high while most Americans have pension and other fund managers controlling their often locked in minor investments compared to the big insider players.

    But in a reasonably healthy capitalist economy there will always be new and old investors to keep the market Casino open for business to ensure a general upward trend over time so as sundance said “Relax. No big deal.” Unless of course you took out a mortgage on your debt free home and invested it all in the market a few days ago to ride the upward trend and retire early. Never invest money in the market unless you can easily do without it.

    Liked by 1 person

    • Luke of the D says:

      Well said! The economy is roaring due to the common sense American First principles of President Trump, but the stock market will rise and fall as the great casino grinds away. I trust new jobs, new businesses, construction, and optimism… but the stock market? Never.

      Liked by 1 person

  17. katshomenow says:

    Q says it’s a message to President Trump that “they” control the markets by the drop of 666.

    Like

    • thedoc00 says:

      Trump is not trying to “control the market”, that is what Obama was doing when trashed the main-street US economy. Trump is working to get them to put their money and activity into the US Economy, which they are either doing or have planned to do.

      Q is full of it and by moving money back to the US, Q is actually doing as Trump is asking ad enabling.

      There is a key message missing from the “tax cut” discussion playing out in the media.
      Yes, current members of the middle class are going to see bigger pay checks.
      Yes, the rich will gain more money, but they re the ones who grow main street economies.
      Under Obama the rate of decline in the size of the middle class accelerated to the point that the rate of decline in the size of the tax base was accelerating as well.
      The people who “grow” the middle class and the tax base are those “evil” rich people who do all the investing. You want those rich people reversing the habits they developed under Obama, by putting their money into the US economy.

      Like

  18. Virtually all S&P and Dow stocks are globalist multinational corporations. Perhaps the big money was betting on Trump getting impeached or otherwise removed from office. The Memo(TM) was a devastating blow to the Left, and by extension the government subsidized multinationals. Exiting NAFTA is just one consequence of the Left’s failure to torpedo Trump’s presidency. Now there is anti-trust litigation to worry about. And even the central bank, the Fed itself, may be threatened. These are all good things, make no mistake. But there’s a lot of money behind all of these parasitic institutions and its now starting to leak out.

    I believe a lot of people thought Mueller was going to be Trump’s undoing – and that once Trump was gone the money spigots would be re-opened into the coffers of these multinationals that comprise something like 90% of the total stock market capitalization. After all, it has always worked out this way since at least the Clinton years. The multinationals and the big banks always came out on top. Not anymore. Hence the panic.

    Like

    • I should also add the same holds true for foreign stock markets as well…their market capitalizations are typically dominated by a few globalist multinational companies based in the country in question, which all basically follow the U.S. model in terms of organization/operation.

      This model of a “national champion” multinational corporation may be seeing the first phase of its ultimate demise.

      Like

  19. Ziiggii says:

    Like

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