Seeking Alpha

Yellen warns on small cap and momo sector valuations

  • Sticking to what we mostly already know about Fed thinking, Janet Yellen - in prepared remarks before the Senate Banking Committee - says interest rates could rise sooner and at a faster pace if labor market strength continues to surprise to the upside. The opposite, she quickly notes, is also true - should data disappoint, policy would be more accommodative than currently anticipated.
  • Treasurys are zigging and zagging on her remarks, but about flat, and the S&P 500 and Dow remain little-changed. Small caps (IWM -0.7%) and momentum sectors like social media (SOCL -1.1%) and biotech (IBB -1.1%) are selling off as the Fed boss says their valuations "appear to be stretched."
  • The Q&A is underway; live blog and video here.
Comments (86)
  • ComputerBlue
    , contributor
    Comments (680) | Send Message
     
    They better be careful in case labor participation jumps down to 61%. According to the BLS, the labor force participation rate was flat at 62.8 percent in June, matching the lowest level recorded in a decade.
    15 Jul, 10:41 AM Reply Like
  • Captain Pike
    , contributor
    Comments (504) | Send Message
     
    Yes anyone watching this cooked unemployment rate and basing a decision on it is rather slow. Until the participation rates recover the labor market is not tight. That will take years of growth.
    15 Jul, 12:59 PM Reply Like
  • bruinswin72
    , contributor
    Comment (1) | Send Message
     
    Thanks Yellen. And your expertise that biotech valuations, specifically, "appear to be stretched" comes from where? You can't lose on that comment, I guess. . . as my holding in BIB would attest to.
    15 Jul, 10:42 AM Reply Like
  • SanDiegoNonSurfer
    , contributor
    Comments (2564) | Send Message
     
    "your expertise that biotech valuations"

     

    Yellen herself may not have expertise in biotech but the Fed has a lot of technology and teams of analysts studying multiple economic and risk indicators -- yes, including equity valuations. Would it really be so surprising if some were sector analysts?
    15 Jul, 12:35 PM Reply Like
  • kata
    , contributor
    Comments (441) | Send Message
     
    Actually, it would be very surprising. Smart analysts in Biotech get big bucks. They don't work for the Fed.

     

    Yellen's remarks are more like "..irrational exuberance.." utterances from Greenspan, and the market kept going for another three years after that. She just tried to hedge her remarks into small cap social and biotech because they have gone up a lot to date.

     

    IMO, how much something has gone up is never a great indicator of how much is can go up. In the long term, valuations are usually tied to fundamentals, not day dreams. So if a biotech perfects a life saving drug, it probably will be in great demand to those that can now afford it worldwide and will deserve to go up. Same is more than likely true for social, tech, medical instrumentation and energy. But you buys your tix and you takes your chance.

     

    I wonder what Ms Yellen is invested in. Hope its not Treasury's, lol...
    15 Jul, 05:46 PM Reply Like
  • june1234
    , contributor
    Comments (2492) | Send Message
     
    At the end of the day with rising rates on the horizon the Fed is just trying to control the bubble they created just as when few weeks ago they mentioned the possibility of applying fees to investors attempting to withdraw money from the $10T corp debt out there
    15 Jul, 06:00 PM Reply Like
  • Welt
    , contributor
    Comments (110) | Send Message
     
    Really killed my PCLN and GILD moves today, but I guess it's healthier for the markets to retreat after her comments rather than shooting up parabolically.
    15 Jul, 10:45 AM Reply Like
  • Fear & Greed Trader
    , contributor
    Comments (4502) | Send Message
     
    A pullback in a name like (NASDAQ:GILD) is an opportunity ,, it certainly isn't "stretched" in regards to its valuation...

     

    Yellen has presented us with a gift..

     

    Long GILD
    15 Jul, 12:41 PM Reply Like
  • leopardtrader
    , contributor
    Comments (860) | Send Message
     
    Who is the SA writer on this rubbish ? She did not say what your headlines portray. This information is misleading. No mention of momo or biotech. What is stretched is some aspect of corporate yields. Thata simply does not translate to momentum stocks !
    15 Jul, 10:50 AM Reply Like
  • leopardtrader
    , contributor
    Comments (860) | Send Message
     
    This is exactly what she said in her prepared remarks:

     

    "Financial Stability
    The Committee recognizes that low interest rates may provide incentives for some investors to "reach for yield," and those actions could increase vulnerabilities in the financial system to adverse events. While prices of real estate, equities, and corporate bonds have risen appreciably and valuation metrics have increased, they remain generally in line with historical norms. In some sectors, such as lower-rated corporate debt, valuations appear stretched and issuance has been brisk. Accordingly, we are closely monitoring developments in the leveraged loan market and are working to enhance the effectiveness of our supervisory guidance. More broadly, the financial sector has continued to become more resilient, as banks have continued to boost their capital and liquidity positions, and growth in wholesale short-term funding in financial markets has been modest.

     

    See the prepared remarks in FED website : http://1.usa.gov/1nDIWfV
    15 Jul, 11:53 AM Reply Like
  • dwdallam
    , contributor
    Comments (6580) | Send Message
     
    leo

     

    Thanks. A much different idea than presented here on SA headlines.
    15 Jul, 12:49 PM Reply Like
  • John Grandits
    , contributor
    Comments (203) | Send Message
     
    perhaps carefully reading the Fed minutes prior to bashing SA would lead to more insightful commentary on these threads. without doing so, or simply performing a word search of the minutes for terms such as, 'momentum' 'biotech' 'social' etc, is pretty careless when making such accusations.
    15 Jul, 01:18 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    Thank you leopardtrader!
    15 Jul, 01:32 PM Reply Like
  • KilgoreTrout
    , contributor
    Comments (27) | Send Message
     
    http://1.usa.gov/1qDEfBJ

     

    "Nevertheless, valuation metrics in some sectors do appear substantially stretched—particularly those for smaller firms in the social media and
    biotechnology industries,"

     

    Pg. 20 of the report linked above.

     

    Agree with John, check your sources before bashing..
    15 Jul, 01:38 PM Reply Like
  • Interesting Times
    , contributor
    Comments (10108) | Send Message
     
    Can "stretched" mean a "bubble" ??
    15 Jul, 02:48 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    Ah, thank you KilgoreTrout. The Fed is very irresponsible speculating on future cash flows of biotech and social media.
    15 Jul, 02:52 PM Reply Like
  • Robert Duval
    , contributor
    Comments (2885) | Send Message
     
    Works for me, LT.
    15 Jul, 11:27 AM Reply Like
  • Deja Vu
    , contributor
    Comments (1148) | Send Message
     
    "For e'en though vanquished, she could argue still;
    While words of learned length and thundering sound
    Amazed the gazing rustics ranged around,
    And still they gazed, and still the wonder grew
    That one small head could carry all she knew."

     

    (changed he to she :-)
    15 Jul, 11:32 AM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    Yellen! What asset class is not "stretched" to you!? You just hurt many small companies ability to employ people, congratulations.
    15 Jul, 11:33 AM Reply Like
  • SanDiegoNonSurfer
    , contributor
    Comments (2564) | Send Message
     
    'What asset class is not "stretched"....'

     

    Natgas.
    15 Jul, 12:42 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    Touche!
    15 Jul, 01:14 PM Reply Like
  • mosheoskar
    , contributor
    Comments (57) | Send Message
     
    We'll I guess I like your comments. Oil natgas and other assets not related to low interest rates are not stretched
    15 Jul, 02:49 PM Reply Like
  • doug.whatzup
    , contributor
    Comments (35) | Send Message
     
    Serious question: Does the evaluation of asset classes fall under the purview of the fed chair? Maybe it does -- I don't know -- but it seems stupid that one woman's remarks about biotechs can tank the markets. I'm pretty sure she doesn't know a lot more about biotechs than I do (which, admittedly, isn't a lot).
    15 Jul, 11:52 AM Reply Like
  • SanDiegoNonSurfer
    , contributor
    Comments (2564) | Send Message
     
    "I'm pretty sure she doesn't know a lot more about biotechs than I do"

     

    "She" doesn't have to. All she needs is for the Fed to have analysts who do have expertise and a system in place for validating their analyses. She's not chairing a sorority dance committee. She's chairing the Governors of the Federal Reserve system and speaks for the Board.
    15 Jul, 12:46 PM Reply Like
  • Tack
    , contributor
    Comments (12704) | Send Message
     
    I'm with Doug on this one. The Fed can and should focus on interest rates, inflation, and liquidity, but not be making judgments on stock-market valuations, much less individual sectors. The market always does, and will, take care of valuation issues without intervention from Fed observers.
    15 Jul, 01:10 PM Reply Like
  • doug.whatzup
    , contributor
    Comments (35) | Send Message
     
    It just seems to me that, if there is in fact a bubble, it'll burst on its own without the Fed's help. Pretty sure evaluating asset classes is not part of her job description, and I have to wonder why she spared the big boys on the Dow, but these are strange times we're living in.
    15 Jul, 01:39 PM Reply Like
  • machiavelli
    , contributor
    Comments (414) | Send Message
     
    doug.whatzup, why are you referring to the statements of a highly educated and experienced official as "one woman's remarks"? Do you think the sex of the individual is important in this regard? If you were trying to be a passive aggressive macho man then congrats you succeeded, otherwise you might want to check yourself.
    15 Jul, 02:06 PM Reply Like
  • doug.whatzup
    , contributor
    Comments (35) | Send Message
     
    Really? It's now politically incorrect to reference a person's gender or to a woman as "she"? Are you serious?
    15 Jul, 02:14 PM Reply Like
  • BornIn87
    , contributor
    Comments (98) | Send Message
     
    machiavelli, I don't think doug.watzup meant anything by using woman. Sure he could have said "one person's remarks", but seeing as he didn't make any sort of negative statement about women, you can hardly make the assumption that he was making any statement in regard to gender. You may need to check yourself, also. As far as I know, it is not wrong to call a woman a woman.
    15 Jul, 02:26 PM Reply Like
  • machiavelli
    , contributor
    Comments (414) | Send Message
     
    Since you got really defensive, Doug, it makes it really easy to assume your manhood is in jeopardy unless you can point out someone's gender without reason. BornIn87, it is obvious to me that Doug wanted to reduce the value of Yellen's statement as much as possible so he brought it down to what he thinks is the lowest level of import: "one woman's remark". It might not be as obvious to some but I see right through it. Have a nice day!
    15 Jul, 02:43 PM Reply Like
  • Interesting Times
    , contributor
    Comments (10108) | Send Message
     
    Sometimes I think the FED needs to just keep quiet. The more they talk the less intelligent they look !!
    15 Jul, 02:51 PM Reply Like
  • doug.whatzup
    , contributor
    Comments (35) | Send Message
     
    I believe you're projecting your own sexism, Machiavelli. What possible difference could it make whether the remarks came from one woman or one man? And in what way is my asking if you're completely off topic comment is serious being defensive? I really thought you must be joking, but since you're obviously not, let me assure you that Janet Yellen's gender is of no consequence or import to me whatsoever.
    15 Jul, 02:56 PM Reply Like
  • machiavelli
    , contributor
    Comments (414) | Send Message
     
    IT, I have not seen Yellen speak but I remember watching poor Bernanke slouched over and sweating at the congressional hearings. He did not look stupid but he also did not look comfortable as he dodged questions.
    15 Jul, 02:58 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    There is not even any historical record for social media firms, speculating on the value is just that - pure speculation. The Fed has no place doing that.
    15 Jul, 03:07 PM Reply Like
  • machiavelli
    , contributor
    Comments (414) | Send Message
     
    Doug, would you agree with me that there is a loud and vocal segment in our society that do put a lot emphasis on gender when they judge someone's abilities? My comments are just part of the fight against that. I hope you feel gender discrimination is wrong like I do. If you do then I owe you an apology.
    15 Jul, 03:19 PM Reply Like
  • SoCalNative
    , contributor
    Comments (423) | Send Message
     
    mach, so tired of your politically inspired "do-gooding." Everyone knows who's team your on.
    15 Jul, 04:27 PM Reply Like
  • SoCalNative
    , contributor
    Comments (423) | Send Message
     
    Yes Doug. He/She or whatever is posting is serious. All the time with this PC garbage. Tell Janet to go fix me a sandwich.
    15 Jul, 04:30 PM Reply Like
  • SoCalNative
    , contributor
    Comments (423) | Send Message
     
    You're so brave. Keep on fighting the machine bro!
    15 Jul, 04:31 PM Reply Like
  • getreal10000
    , contributor
    Comments (228) | Send Message
     
    machiavelli,
    It's nice that you want to support women but please understand, even if there is a loud and/or vocal segment that judges by gender, individual women are eminently capable of changing hearts and minds as they meet and exceed expectations for their jobs. No special treatment is needed. That being said, I didn't read anything negative in doug's comment. As the Fed chairperson, Janet Yellen is fair game for discussion and passing judgment. I've read all kinds of comments here about Ben Bernake, Larry Summers, and other men. I've made some of them myself!
    15 Jul, 04:33 PM Reply Like
  • Robert Duval
    , contributor
    Comments (2885) | Send Message
     
    It's totally meaningless. If Yellen commented on any asset class, it would not sell off unless it should anyone.

     

    If the momemtum stocks are so cheap after today, we should see the bulls here buying with both hands, along with insiders.

     

    Otherwise the old saying, put up or shut up. I'm short these stocks and haven't covered a single share.
    15 Jul, 04:57 PM Reply Like
  • machiavelli
    , contributor
    Comments (414) | Send Message
     
    Thanks, SoCalNative. I see you side with the misogynists. Good for you.
    15 Jul, 05:00 PM Reply Like
  • Robert Duval
    , contributor
    Comments (2885) | Send Message
     
    Then biotechs weren't that strong to begin with. If they are, insiders would back up the truck today. I don't see that.
    15 Jul, 05:17 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    MacroTrader:

     

    "If Yellen commented on any asset class, it would not sell off unless it should"

     

    Maybe over the long run it would go back to where it should be, I understand your point, but when the Chair of the Board of Governors of the Federal Reserve System bashes an asset class, over the short run "deserve" has nothing to do with it.
    15 Jul, 05:42 PM Reply Like
  • littup
    , contributor
    Comments (315) | Send Message
     
    machiaveli,

     

    you dont have to assume that I am reducing the value of Yellen's statements.
    I am saying it loud and clear. I trust or listen to no central banker, including Yellen.

     

    I agree with all the commentators that state that all this biotech and social media overvaluation(even though clearly some are) is just a hedge for the fed.

     

    I consider it RIDICULOUS for the fed to need to observe how frothy or bubbly they HAVE MADE the markets with all their intervention.

     

    Why doesnt yellen comment on nyc real estate? or banks balance sheets? oh no..she couldnt do that could she?

     

    so please, get real.
    15 Jul, 09:22 PM Reply Like
  • littup
    , contributor
    Comments (315) | Send Message
     
    agreed.
    15 Jul, 09:23 PM Reply Like
  • littup
    , contributor
    Comments (315) | Send Message
     
    machiavelli, this isnt the place for this dude. enough with your monetary credit expansion concepts. you're destroying us.
    15 Jul, 09:23 PM Reply Like
  • kata
    , contributor
    Comments (441) | Send Message
     
    I guess you don't remember "Greenspanspeak". He was masterful at saying whatever the listener wanted to hear in his words and nothing at all. But transparency was introduced by Bernanke and for the life of me, I don't know what it accomplished. Nothing more or less than QE, I suspect. Yellen's Brooklyn accent is charming but she only responds to the dumb questions she's asked. Personally, I'd rather listen to Greenspan but she'll get better.
    15 Jul, 11:19 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    I was a complete fan, today was abysmal for no reason, in defense of nothing, and not appropriate at all, total agency problem at the Fed.
    15 Jul, 11:28 PM Reply Like
  • SanDiegoNonSurfer
    , contributor
    Comments (2564) | Send Message
     
    Tack et al., Equity analysis is not some new thing at the Fed. Here's a paper from one of the Fed's research groups analyzing 1) the 1987 stock market crash, and 2) the =>role of the Federal Reserve at the time<= in intervening to ensure adequate liquidity for the purpose of preventing a panic-fueled crisis. Interesting to note just how many factors they analyzed -- everything from prevailing portfolio management algorithms to futures pricing.

     

    Eveyone seems hypersensitized. Because QE. Because Yellen. But really there's nothing radically out of the ordinary here.
    15 Jul, 11:55 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    I don't believe in their magic formula, but I'm sure it works when followed by a don't-fight-the-Fed bash. As someone else pointed out people do not do things for country, they do it for money, and for the Fed to say that their government employees know better than the people that could easily have their jobs is misguided at best.

     

    Agency problem because their dual legal mandate is full employment and price stability, and they are freelancing.
    16 Jul, 12:06 AM Reply Like
  • SanDiegoNonSurfer
    , contributor
    Comments (2564) | Send Message
     
    Forgot the link: http://1.usa.gov/120VIKB
    16 Jul, 10:25 AM Reply Like
  • MarketDummy
    , contributor
    Comments (79) | Send Message
     
    "The Committee recognizes that low interest rates may provide incentives for some investors to "reach for yield," and those actions could increase vulnerabilities in the financial system to adverse events. While prices of real estate, equities, and corporate bonds have risen appreciably and valuation metrics have increased, they remain generally in line with historical norms. In some sectors, such as lower-rated corporate debt, valuations appear stretched and issuance has been brisk. Accordingly, we are closely monitoring developments in the leveraged loan market and are working to enhance the effectiveness of our supervisory guidance. More broadly, the financial sector has continued to become more resilient, as banks have continued to boost their capital and liquidity positions, and growth in wholesale short-term funding in financial markets has been modest."

     

    Text says "low-rated corporate debt". Nothing there about "Small caps and momentum sectors like social media and biotech."
    15 Jul, 11:59 AM Reply Like
  • heywally
    , contributor
    Comments (177) | Send Message
     
    Not in IBB right now but the Fed Chief is commenting on market valuations now?

     

    Probably okay though as some volatility is my cup of tea, as I buy dips conservatively. Thanks Janet.
    15 Jul, 12:04 PM Reply Like
  • littup
    , contributor
    Comments (315) | Send Message
     
    indeed, its a joke that the fed is now commenting on market valuations. its none of your business fed.
    15 Jul, 09:25 PM Reply Like
  • SA Editor Stephen Alpher
    , contributor
    Comments (540) | Send Message
     
    "Nevertheless, valuation metrics in some sectors do appear substantially stretched—particularly those for smaller firms in the social media and
    biotechnology industries."

     

    http://1.usa.gov/1qDEfBJ
    15 Jul, 12:05 PM Reply Like
  • leopardtrader
    , contributor
    Comments (860) | Send Message
     
    Thanks. I didnt see the full report
    15 Jul, 12:27 PM Reply Like
  • yliu54
    , contributor
    Comments (170) | Send Message
     
    I just don't get it. The Fed has been backing up that retarded money printing program for years, now they are complaining about side effects, looks it is everybody else's fault.
    Good news is, We have a stock analyst as Fed chair now. I think Obama should tell us clean energy sector is undervalued tomorrow, since he likes it so much.
    15 Jul, 12:11 PM Reply Like
  • eagle1003
    , contributor
    Comments (1485) | Send Message
     
    I thought the communist method of 'central planning" had been discredited with the breakup of the USSR. Now the US is walking down the same path with the FED politburo calling the shots. Truly mind boggling.
    15 Jul, 12:25 PM Reply Like
  • Scott Beardsley
    , contributor
    Comments (17) | Send Message
     
    I don't think you genuinely understand Soviet central planning.
    15 Jul, 04:04 PM Reply Like
  • MrVincent
    , contributor
    Comments (229) | Send Message
     
    Yellen warned about social media stocks. I finally agree with her on something.
    15 Jul, 12:48 PM Reply Like
  • psychological-dividends
    , contributor
    Comments (561) | Send Message
     
    I wonder if Yellen shorted any of these stocks.
    15 Jul, 01:07 PM Reply Like
  • Welt
    , contributor
    Comments (110) | Send Message
     
    I realllly doubt it.......
    15 Jul, 01:17 PM Reply Like
  • june1234
    , contributor
    Comments (2492) | Send Message
     
    She meant utilities which have been markets momo sector lately
    15 Jul, 01:53 PM Reply Like
  • Mark Krieger
    , contributor
    Comments (3765) | Send Message
     
    stretched? Now that's an understatement!
    15 Jul, 02:00 PM Reply Like
  • Lakeaffect
    , contributor
    Comments (967) | Send Message
     
    For years the Fed has suppressed rates and pushed investors out on the risk curve. They've printed money and degraded the dollar. They've set inflation on it's own momo track. This in an effort to accomplish a behind-the-scenes re-capitalization of the oligarch banking system, at the expense of middle class savers, investors and working folks.

     

    By implementing endless series of QE and other manipulations, the Fed is the enabler and author of the current dysfunctional political situation. They have taken Congress and the President off the hook for doing anything to assist economic growth, opening the door for them to bicker over meaningless issues and accomplish nothing while Rome burns.

     

    Apparently Yellen is trying distance the fed from the bubble that is now in danger of bursting. Better to blame the careless investor for letting this get out of hand.

     

    It is funny to me how those investors that jumped on the bandwagon for the "free ride" now decry Yellen's foray into manipulating equities they own. It's apparently ok to those investors if the Fed manipulates other folks investments, but not the ones they own.
    15 Jul, 02:01 PM Reply Like
  • littup
    , contributor
    Comments (315) | Send Message
     
    nicely put!
    15 Jul, 09:26 PM Reply Like
  • pollyserial
    , contributor
    Comments (1055) | Send Message
     
    Is anyone surprised that the Yellen slammed sectors sold off hard LAST WEEK?
    15 Jul, 02:04 PM Reply Like
  • Bouchart
    , contributor
    Comments (755) | Send Message
     
    Yellen, I want to go short TSLA. If I do so could you make a prepared statement saying it's overvalued? I could use a few extra bucks. Thank you.
    15 Jul, 02:43 PM Reply Like
  • psychological-dividends
    , contributor
    Comments (561) | Send Message
     
    Hahah. Where is the line? Its so blurry I can't see it.
    15 Jul, 09:50 PM Reply Like
  • Illuminati Investments
    , contributor
    Comments (3283) | Send Message
     
    This is her "irrational exuberance" moment. If the Fed's ultra dovish policies backfire and we get asset inflation, she can always point to these comments and say "see, I warned you" as she parlays the unfortunate fact that Fed chairs are now such influential celebrities into speaking gigs and book deals.
    15 Jul, 04:31 PM Reply Like
  • Fear & Greed Trader
    , contributor
    Comments (4502) | Send Message
     
    Funny to see the reaction to the minutiae of a fed speech

     

    Whats really going on is the earnings releases from (NYSE:WFC) (NYSE:C) (NYSE:GS) (NYSE:JPM) (NYSE:JNJ) and now (NASDAQ:INTC) and they are hardly overvalued or in a bubble..

     

    Speaking of bubbles

     

    excerpts from a recent article from Value Walk on the Types of "bubblers"

     

    Doomsday Bubblers have been warning us that the stock market is in a bubble for as long as you have known them, and either want you to keep your entire portfolio in cash or in gold (or bitcoins). They remind me of this character from Winnie the Pooh and their theme seems to be that stocks are always over valued.

     

    Knee Jerk Bubblers go into hibernation in bear markets but become active as stocks start to rise and become increasingly agitated, the more they go up. They are the Bobblehead dolls of the bubble universe, convinced that if stocks have gone up a lot or for a long period, they are poised for a correction.

     

    Armchair Psychiatrist Bubblers use subtle or not-so-subtle psychological clues from their surroundings to make judgments about bubbles forming and bursting. Freudian in their thinking, they are convinced that any mention of stocks by shoeshine boys, cab drivers or mothers-in-law is a sure sign of a bubble.

     

    Conspiratorial Bubblers believe that bubbles are created by small group of evil people who plan to profit from them, with the Illuminati, hedge funds, Goldman Sachs and the Federal Reserve as prime suspects. Paranoid and ever-watchful, they are convinced that stocks are manipulated by larger and more powerful forces and that we are all helpless in the face of this darkness.

     

    Righteous Bubblers draw on a puritanical streak to argue that if investors are having too much fun (because stocks are going up), they have to be punished with a market crash. As the Flagellants in the bubble world, they whip themselves into a frenzy, especially during market booms.

     

    Rational Bubblers uses market metrics that are both intuitive and widely used, note their divergence from historical norms and argue for a correction back to the average. Viewing themselves as smarter than the rest of us and also as the voices of reason, they view their metrics as infallible and mean reversion in markets as immutable.

     

    check all that apply
    15 Jul, 04:38 PM Reply Like
  • Scott Beardsley
    , contributor
    Comments (17) | Send Message
     
    Very entertaining summary of bubble-think. One small criticism; doomers dislike bitcoin because the electrical grid WILL go down permanently within the hour. Question them on this logic, and they scream GOLD and GUNS at you until your ears bleed.
    16 Jul, 09:38 AM Reply Like
  • Robert Duval
    , contributor
    Comments (2885) | Send Message
     
    Fear, then Yellen gave you a gift today! Time to load up on social media stocks cheap! (er).
    15 Jul, 04:58 PM Reply Like
  • Tack
    , contributor
    Comments (12704) | Send Message
     
    M...

     

    Notice you suddenly fail to mention your loudly touted (NYSE:BAC) & (NYSE:C) shorts.
    15 Jul, 05:09 PM Reply Like
  • Fear & Greed Trader
    , contributor
    Comments (4502) | Send Message
     
    T,
    he (Mac) only mentions the (on paper) winners
    15 Jul, 05:28 PM Reply Like
  • Robert Duval
    , contributor
    Comments (2885) | Send Message
     
    Best Ways To Invest -- What's Your Opinion? A Place To Share Ideas! #31 [View instapost]
    Today I added 2 more shorts. Both are a target of zero in my view. (NASDAQ:GRPN) and (NASDAQ:ANGI)

     

    (NYSE:P) I see as perhaps worth $10 (currently 26)

     

    (NYSE:YELP) is worth maybe 25-30 (currently 70)

     

    I changed my mind, made room for ANGI and GRPN by covering the banks. I'm not any more bullish, but why short something for a dollar or 2 when others might drop 50%

     

    I am also not short (NASDAQ:AMZN) or (NASDAQ:PCLN) anymore. Why?

     

    I only want to short the second tier, weaker players, that will be killed by the bigger fish like the above 2 or (NASDAQ:GOOG) or (NASDAQ:AAPL) Even (NYSE:TWTR) I would rather not short right now -- as it could turn into THE news feed.

     

    I reiterate most assets I see as expensive, but some like the ones I am short, are ridiculous.

     

    My only short that is strong technically; is (NASDAQ:Z), which has gone parabolic, but come off recently.
    15 Jul, 05:36 PM Reply Like
  • Fear & Greed Trader
    , contributor
    Comments (4502) | Send Message
     
    Mac,

     

    Yelllen dint give me a gift - the latest earnings on (NYSE:C) ,(NYSE:JPM) (NYSE:GS) and (NASDAQ:INTC)

     

    are the 'gifts" that were earned with good corp results..

     

    should be more of those in the next few weeks

     

    Your "momo" stocks arent's a 'proxy for the "stock market"
    15 Jul, 05:52 PM Reply Like
  • Robert Duval
    , contributor
    Comments (2885) | Send Message
     
    I covered those.

     

    Changed my mind when I added GRPN and Angi shorts a few days ago, which I was surprised to get stock on. Covered all banks at the same time and posted clearly as such.

     

    You really seem to like to cherry pick what I post. You saw my post clear enough. Why pretend I never made it? Going to do this again?

     

    I'm not a fan of the banks. Easy to beat when you release enough loan loss reserves. Duh.

     

    Anyway, as you are sure I am wrong, buy some yelp! You are a pro, I'm an amateur. Surely I must be wrong.
    15 Jul, 05:15 PM Reply Like
  • Robert Duval
    , contributor
    Comments (2885) | Send Message
     
    If anyone is er------- I can't say it -- to buy momo stocks that have never made a profit, then complain about the Fed which has done nothing but talk up assets, I don't know what to say to you.

     

    Ps that applies to junk bonds too.

     

    Consider your investment strategy, carefully,

     

    Short momo / social media.
    15 Jul, 05:21 PM Reply Like
  • chinabox
    , contributor
    Comments (2) | Send Message
     
    A picture is worth a thousand words:

     

    http://on.ft.com/1ktNAZp
    15 Jul, 06:06 PM Reply Like
  • psychological-dividends
    , contributor
    Comments (561) | Send Message
     
    I think we can agree. Janet Yellen has some serious communication problems. Hahah.
    15 Jul, 09:54 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    Here is a petition:

     

    "Janet Yellen and the Federal Reserve should state publicly that they will not make further comment on valuations of individual sectors of the stock market."

     

    Please sign:

     

    http://goo.gl/2I6YS9
    18 Jul, 07:39 PM Reply Like
  • Scott Beardsley
    , contributor
    Comments (17) | Send Message
     
    That's hilarious.
    18 Jul, 07:44 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    BELIEVE my friend, I ousted an All-Star catcher and annoyed a sitting POTUS: http://seekingalpha.co...
    18 Jul, 07:50 PM Reply Like
  • dramorgan
    , contributor
    Comments (39) | Send Message
     
    Just signed. Not right that anyone in that position should be actively influencing my investments. What was HER reasoning?
    18 Jul, 08:35 PM Reply Like
  • Joe Springer
    , contributor
    Comments (2162) | Send Message
     
    Thanks dramorgan, the reasoning was never provided! Mark Schoenbaum jut signed too!

     

    http://cnb.cx/1szFoyu
    18 Jul, 08:39 PM Reply Like
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