So I thought the world (at least the US) was in trouble

[Goin2drt]

I am just curious. So the pandemic hit hard. Lots of folks lost jobs and times were/are pretty tough. The US wants to print money and put trillions into the economy but not much of that is going to actual individuals. Let's face it the stimulus is not huge money that would cause what we are seeing right now.

With the above facts why is everything going bonkers and folks are spending like crazy. Not just the high end watch market (as we all know from TRF). Cars are going crazy, selling for over MSRP and you can't even get them. Homes are selling like nuts with multiple offers and selling for over asking in bidding wars. 2 just went up for sale in our small neighborhood and comps were $100 sq ft and they were listed and sold in days for $225 sq ft. Not a small increase.

I thought times were tough? What is happening? It seems like these are the best of times in terms of folks having and spending money like crazy. Me personally we are sitting on the sidelines. Socking money away as I do not want to pay a premium for anything. Hell if I could sell my house I would, problem is we would just have to buy another at these inflated rates.

[Golfguy77]

I can only speak for myself, but we didn’t travel and eat out at restaurants like we normally do last year. That freed up money to purchase things like luxury goods.

[m j b]

Yeah, what he said. For those of us who still have jobs, lots of money and lots of pent-up demand.

I just sold my one year-old domestic car for more than I paid for it.

[PackPride]

Supply and demand- combined with cheap money.

[Computantis]

Originally Posted by Golfguy77

I can only speak for myself, but we didn’t travel and eat out at restaurants like we normally do last year. That freed up money to purchase things like luxury goods.

My next question is how often are people eating out? It’s bananas!

[CastorKrieg]

Originally Posted by Goin2drt

I thought times were tough? What is happening? It seems like these are the best of times in terms of folks having and spending money like crazy. Me personally we are sitting on the sidelines. Socking money away as I do not want to pay a premium for anything. Hell if I could sell my house I would, problem is we would just have to buy another at these inflated rates.

Covid doesn't hit people equally, white-collar workers who can WFH are not spending money buy saving - no travel, no eating out, etc. Suddenly people have LOTS of money available. This + Robinhood is also why stock market is rushing ahead.

[HHIslander]

Good post, OP. It appears to me too that the world has pretty much gone crazy. As an old left-brain MBA guy who has seen many bubbles come and go, this is shaping up to be the biggest bubble I've ever seen. I've been riding it up in the market and with some real investments, but I am liquidating right now. I wouldn't buy anything either. I just sold a long-term rental condo in NW FL area that I paid $210K for in 2017 for $450k. Sold in 8 hours. PT Barnum was right.

Seems like the entire world has forgotten ECON 101/102.

[Thug]

The pandemic hit the lower class more than upper due to nature of jobs (service workers harder hit than an analyst at F500). Most restaurants are probably still bringing in a lot less versus pre COVID.

[sgwatchguy]

We’re in the upside down. We just don’t know it.

[CastorKrieg]

Originally Posted by HHIslander

Seems like the entire world has forgotten ECON 101/102.

They always do because 'this time it is different'. It never is. I need the market to hold 2 more months, then I liquidating for a down payment for the family home.

[77T]

I know your gist is the financial angle - but the global loss of life reaching nearly 3 million has consequential emotional impacts.

Ever heard, “Let us eat and drink,
for tomorrow we die”?

I think the spending sprees you’re noticing may be impacted by a “You Only Live Once” frame of mind. Debt is rising as sharply so it isn’t all stimulus money as some may suspect.


Sent from my iPhone using Tapatalk Pro

[brandrea]

Originally Posted by 77T

I know your gist is the financial angle - but the global loss of life reaching nearly 3 million has consequential emotional impacts.

Ever heard, “Let us eat and drink,
for tomorrow we die”?

I think the spending sprees you’re noticing may be impacted by a “You Only Live Once” frame of mind. Debt is rising as sharply so it isn’t all stimulus money as some may suspect.


Sent from my iPhone using Tapatalk Pro

Couldn’t agree more Paul

[breitlings]

Hyper inflation

[EEpro]

Those items and our groceries are all denominated in ever more worthless dollars.

[CastorKrieg]

Originally Posted by 77T

I know your gist is the financial angle - but the global loss of life reaching nearly 3 million has consequential emotional impacts.

That is true, but also a lot of people inherited a lot of money and property. Say what you want - having parents in assisted-care home on the other side of the country is not a very comfortable situation for anyone.

[turkeysub93]

Curious on everyone's thoughts...

Will we see a correction in the real estate market by early 2022? Or earlier?

[HHIslander]

Originally Posted by CastorKrieg

They always do because 'this time it is different'. It never is. I need the market to hold 2 more months, then I liquidating for a down payment for the family home.

+1000. Trying to explain "it never is" to someone who is convinced "this time it is" is more than frustrating. I've got a sister who is thinking of putting her kids college money in crypto because someone at her work made a killing off of it. The pro-cryptos are the absolute worst, they're swimming in the kool-aid. That implosion is going to be nuclear and I'd short it if I could find a way.

[CastorKrieg]

Originally Posted by HHIslander

+1000. Trying to explain "it never is" to someone who is convinced "this time it is" is more than frustrating. I've got a sister who is thinking of putting her kids college money in crypto because someone at her work made a killing off of it. The pro-cryptos are the absolute worst, they're swimming in the kool-aid. That implosion is going to be nuclear and I'd short it if I could find a way.

Crypto is for grandmas and grandpas, it's NFTs where all the cool kids play now (if crypto is stupid how do we call NFT?).

A good short article from a16z on the subject: https://a16z.com/2021/03/29/active-trading/

A combination of illusory superiority bias—the belief that we are more financially savvy than we actually are—and a culture of financial optimism leads most retail traders to believe they have above-average trading ideas and strategies. (This, of course, is contradicted by proponents of passive investing, who point out that active strategies underperform passive ones in returns especially when accounting fees.) In part, the psychology of American exceptionalism extends to active trading.

This is going to be one hell of a ride down.

[HHIslander]

Originally Posted by CastorKrieg

Crypto is for grandmas and grandpas, it's NFTs where all the cool kids play now (if crypto is stupid how do we call NFT?).

A good short article from a16z on the subject: https://a16z.com/2021/03/29/active-trading/



This is going to be one hell of a ride down.

LOL at NFTs. CNBC had a guest last week who said "The future lies in NFTs" and the anchors didn't even challenge him, completely let him get away with it. Non fungible Tulips.

That's a great read, I have already read it. I think I got the link here?? but not sure.

Heck of a ride indeed. I just wish I knew when it was gonna start and what the catalyst will be. I'm thinking a combo of inflation/rates and a geo-political crises or two will push it. You?

[sokoloka]

https://www.youtube.com/watch?v=r7GzaLROW0E&t=1s

Lovely video on the general asset surge we're seeing.

[CastorKrieg]

Originally Posted by HHIslander

I just wish I knew when it was gonna start and what the catalyst will be. I'm thinking a combo of inflation/rates and a geo-political crises or two will push it. You?

My guess is the rates going up, but on the Fed's side it's not going to happen at least for 1-2 years, every government in the world now wants people to spend money going out of the pandemic and not save. US is a bit ahead of the curve, but I'm surprised countries in Europe do not put specific measures to boost consumption in the short term - I think it will happen in the summer once we are sure there won't be any more lockdowns.

[Blansky]

These type of upheavals are above my pay grade in terms or the financial aspects BUT I wonder socially, if we'll see a baby boom once the euphoria kicks in from life as normal again.

Will we already be near a baby boom due to all that free time at home.

Will we see a lot of divorces from "too much time at home".

And of course, how will work, telecommuting, play out in the future.

[flyboyyy]

You'll note the big banks just had a blowout quarter. JPM / GS are somewhat bellwethers of consumer spending (from the credit side anyway). There is an interesting interview earlier in the week where Jamie Dimon notes the glut of savings that has grown quite substantially over the past year. While many folks are still obviously hurting, overall the glut of liquidity (and looking like more coming) shows there is still a LOT of money out there ready and willing to be spent. Folks are correct though, no escaping the basic laws of econ and physics. Here's some quotes from the interview earlier in the week:

“What happened is, the consumer has so much money, they’re paying down their credit card loans, which is good,” Dimon said. “Their balance sheet is in excellent, outstanding shape – coiled, ready to go and they’re starting to spend money. Consumers have $2 trillion in more cash in their checking accounts than they had before Covid.”

Total loans at the bank slipped 4% from a year earlier to $1 trillion, even as deposits held at JPMorgan jumped 24% to $2.28 trillion. While that would normally be a bearish sign in a weakening economy, in this case, it just means that consumers will be laden with cash as vaccines allow for a broader reopening, Dimon said Wednesday during a call with reporters.

Consumers have been saving roughly 30% of their stimulus checks from each of three rounds, and recently have been plowing more money into debt repayment, CFO Jennifer Piepszak said.

[Goin2drt]

Originally Posted by 77T

I know your gist is the financial angle - but the global loss of life reaching nearly 3 million has consequential emotional impacts.

Ever heard, “Let us eat and drink,
for tomorrow we die”?

I think the spending sprees you’re noticing may be impacted by a “You Only Live Once” frame of mind. Debt is rising as sharply so it isn’t all stimulus money as some may suspect.


Sent from my iPhone using Tapatalk Pro

I agree this has a part as well to do with it. I just fear what is to come. Even with "help" from housing programs and offering lower interest rates and longer pay offs just rolls the rock down the road. End of the day if folks can't pay, they can't pay. Also I understand the ole Econ 101 and inflation is starting to happen, try building a home right now, so when that starts to have an effect on the spending craze, oh boy.

Just really weird that on one side you hear doom and gloom and we need to keep printing money because the financial crisis yet the actual indicators of folks spending like crazy would tell you something different.

[huncho]

Originally Posted by HHIslander

LOL at NFTs. CNBC had a guest last week who said "The future lies in NFTs" and the anchors didn't even challenge him, completely let him get away with it. Non fungible Tulips.

That's a great read, I have already read it. I think I got the link here?? but not sure.

Heck of a ride indeed. I just wish I knew when it was gonna start and what the catalyst will be. I'm thinking a combo of inflation/rates and a geo-political crises or two will push it. You?

NFTs are a bubble but that doesn't mean they're a scam. they definitely have some very good use cases, one of which would be ticket sales

[Chewbacca]

Everyone’s not wrong and more right than most as it pertains to their own markets and situation.

I’ll add that it’s always wise to slow down with big ticket items, there’s always another bus.

Old good quality assets in smaller markets were too cheap for too long. Digital means you don’t need to live in SF, NYC, Austin or Dallas to be ‘in’ the right areas. You can live anywhere and be relevant. See post above for $100 ft² (wtf?) for a ready built home, you can’t build for that. But dropping $50k on a watch with $2k worth of gold makes sense?

Cars are selling for over because there’s less. Simple as that. The supply chain is strained and it’s the second choice for those who want a new toy and can’t get the home or boat or rec property.

There’s always more to debate but it’s all pretty logical (irony) when you study historical info, business, and human behaviour.

I’m going to plant some tulips.

[pickettt]

It's disheartening when everyone knows things don't make sense, but they just keep on believing the story.

[tudorbaja27]

Originally Posted by Goin2drt

I am just curious. So the pandemic hit hard. Lots of folks lost jobs and times were/are pretty tough. The US wants to print money and put trillions into the economy but not much of that is going to actual individuals. Let's face it the stimulus is not huge money that would cause what we are seeing right now.

With the above facts why is everything going bonkers and folks are spending like crazy. Not just the high end watch market (as we all know from TRF). Cars are going crazy, selling for over MSRP and you can't even get them. Homes are selling like nuts with multiple offers and selling for over asking in bidding wars. 2 just went up for sale in our small neighborhood and comps were $100 sq ft and they were listed and sold in days for $225 sq ft. Not a small increase.

I thought times were tough? What is happening? It seems like these are the best of times in terms of folks having and spending money like crazy. Me personally we are sitting on the sidelines. Socking money away as I do not want to pay a premium for anything. Hell if I could sell my house I would, problem is we would just have to buy another at these inflated rates.

Depends which world you live in. WFH, remote lifestyle? Engaging in business not affected by COVID? You're fine.

The lower class has been hit much harder by this.

[77T]

Originally Posted by huncho

NFTs are a bubble but that doesn't mean they're a scam. they definitely have some very good use cases, one of which would be ticket sales

The best use case for the NFT is registering your durable and sole ownership of the IP for certain digital assets. Not for one-time uses like ticketing. In many cases you might resell a ticket - but the image on a phone or the digital asset can be duplicated outside the NFT structure.

The ticket gives you no rights to anything that you experience via its use.

The underlying blockchain that tracks and validates one’s NFT is a good use for tracking anything - be it ticketing or crates of goods. I think that’s what you may have meant?


Sent from my iPhone using Tapatalk Pro

[huncho]

Originally Posted by 77T

The best use case for the NFT is registering your durable and sole ownership of the IP for certain digital assets. Not for one-time uses like ticketing. In many cases you might resell a ticket - but the image on a phone or the digital asset can be duplicated outside the NFT structure.

The ticket gives you no rights to anything that you experience via its use.

The underlying blockchain that tracks and validates one’s NFT is a good use for tracking anything - be it ticketing or crates of goods. I think that’s what you may have meant?


Sent from my iPhone using Tapatalk Pro

i was referring to mark cuban's vision for nft's and something that he's going to try to implement with the mavericks. i think we're far away from the digital asset use case

https://www.cnbc.com/2021/03/26/mark...ticketing.html