Posted by kristianp 3 days ago
Wednesday - "Market soars because of election"
Thursday - "Market plummets because of election"
Can we at least agree that no one has any idea what is going on?
"Market drops 3% as Foo"
Thanks to whoever added that sub, now we have rubbish like this.
Am I crazy? Wasn't Astra released just over a month ago? And wasn't Fable 5.1 released around the same time?
How often do we expect frontier models to be released?
Fable 5 was June 9 > Fable 5.1 was September 1 (85 days)
Opus 5 was July 24 > Opus 5.5 was September 22 (61 days)
Yeah, we're not due for a model refresh until the end of month if current release roadmaps of 2-3 months hold.
Still +4% YoY.
24/7 sensationalist news is just exhausting.
Anyone paying attention knows the market is in a weird place, and large swings today are the small swings of the past. It's hardly a "plummet" when the amortized line for the past month, including today, is mostly a linear decline.
We've had a couple of single-day 4% drops over the past few months too. Oh no, the market is the lowest it's been in... 3 months!? This is the largest decline we've seen in... 4 months!?
Could it be a market correction? Could it be a full-on collapse? Sure.
But is a single 4% drop worth a headline "plummeting into correction territory"? Not really.
That term has a very specific meaning in that context.
https://en.wikipedia.org/wiki/Market_correction
[ For the record, the link I originally included: https://www.wsj.com/livecoverage/stock-market-today-dow-sp-5... ]
That said, the Nasdaq hasn't seen a lot of -4.8% days recently. This particular article isn't egregious.
This is a bigger jump, but it's also immediately after elections and other activity so I'd expect higher volatility than normal.
Do you think people who buy QQQ are impressed with this?
VTV is up 21% yoy btw.
Yesterday Nvidia's market cap was 4.89T. Today it is $4.45T. What happened to the $440 billion? Do you think we could have built factories with it?
Theoretically the market cap should equal the present value of expected future returns (dividends and buybacks, not speculation), modulo risk, but that assumes a perfect market.
Did you just wake up from a 30 year nap or?
That said, a lower share price is not a cost to the company, except perhaps in terms of stock based compensation.
It's a "shitty economy" today because
(1) Interest rates were generationally low for an extended period of time from 2009 - 2022. We will likely never see that kind of sugar rush again in our lifetimes.
(2) Trump made a deal with OPEC+ during the early days of Covid to drastically cut supply for some fixed time interval. That agreement hurt our economy coming out of Covid.
(3) Consumers completely changed their behaviors and the supply chain had lots of random kinks in the flow of goods. Some countries still maintained closed borders. Ports had months log backlogs of ships waiting to offload cargo as shipping containers were in short supply where they were needed.
(4) The price of eggs and pork were massively inflated because of avian+swine flu outbreaks which we normally deal with by killing the entire flock.
(5) The west coast had a massive drought and a terrible fire season. This was awful for farming/ranching and we still haven't rebuilt the cow herds that shrunk from those years.
(6) Capitalism demands constant efficiency improvements. If they can avoid a full time hire by instead using independent contractors, they will. If they can create an industry of gig workers instead of long term contracts, they will. The entire economy has been rebalancing risk and uncertainty on the backs of workers and away from companies. This causes all sorts of drops in quality of life, consumer sentiment, financial security among the society.
Biden's regulatory regime had almost nothing to do with the efficiency of the economy during his term. Just because he didn't open more of Alaska's wilderness to fresh drilling or because he didn't approve the KeyStone XL pipeline didn't have any noticeable effect on the US economy (except perhaps to keep some more truck drivers employed).
I’m not saying Europe is automatically better on those axes, but even the least charitable assessments have it very competitive with the US on several.
All of which is to say: “well if our politics are so backwards how come we have so much economic/military power?” is a structurally useless question to ask, because those things are not correlates the way people think they are. It’s like asking “if your car is so much safer than mine, how come mine is so much faster?”
The current economy being Biden’s fault, and not tariffs, corrupt tax cuts for the rich, and oil blockades, is certainly a take.
Judging by the recent elections, I’d say most US voters don’t agree with that take.