Althouse: At the New Year's Eve Café...

December 31, 2017

At the New Year's Eve Café...

... what are you seeing in that crystal ball?

114 comments:

The Cracker Emcee Refulgent said...: '36 was kind of a grim year. I'm betting '18 will be a whole lot better. No Deptession. No appeasement.; 12/31/17, 6:03 PM
The Cracker Emcee Refulgent said...: Or Depression.; 12/31/17, 6:04 PM
Unknown said...: Shouldn't that crystal ball be on the back of a turtle, rather than an elephant?

Turtles all the way down for 2018.

- james james; 12/31/17, 6:07 PM
Jaq said...: Man, watching the Bills Dolphins game and they had a scuffle and the refs ran out of flags and started throwing hats. Can’t wait to see how this comes out.; 12/31/17, 6:07 PM
Jaq said...: “There are multiple fouls on this play!” And the ref is just grinning Couldn’t really follow it all.; 12/31/17, 6:08 PM
rhhardin said...: I wonder if it's worth recording the midnight celebratory gunfire that rural Ohio prides itself on again. It's awfully cold to be outside with a rifle this year.; 12/31/17, 6:10 PM
eddie willers said...: What a great illustration!

Google image search tells me it's J.C. Leyendecker; 12/31/17, 6:13 PM
Lucien said...: I've known for a while that most of the hatred in our politics comes from the "Resistance", but now Katha Pollitt has come out and admitted it in the New York Review of Books.

She hates everyone who voted for Trump . . and everyone who voted for Jill Stein . . . and everyone who voted for Gary Johnson. She pretty much hates anyone who did not demonstrate sufficient fealty to the Entitled One.

The official image for 2017 should include someone being hit over the head with a sign reading "Love Trumps Hate".; 12/31/17, 6:14 PM
Jaq said...: She pretty much hates anyone who did not demonstrate sufficient fealty to the Entitled One.

Not to mention, she hates everybody who believed Juanita Broaddrick.; 12/31/17, 6:18 PM
Jaq said...: Streamed Blade Runner 2049, it was a pretty good move. right up to the complete dud of an ending.; 12/31/17, 6:21 PM
n.n said...: In '36, it was a progression from catastrophic anthropogenic global warming to catastrophic anthropogenic climate change. In 2018, hopefully people have invested in anthropogenic futures, and we can smooth the global climate reset.; 12/31/17, 6:23 PM
Oso Negro said...: Booth Tarkington!! Who here has read “Penrod” ? Or “Penrod and Sam”?; 12/31/17, 6:25 PM
rhhardin said...: In Your Eyes (2014) is a little unsteady about what the problem is and how the solution works, except maybe take it as about what love is like in general, with an allusion to Dustin Hoffman breaking up the wedding in The Graduate, as to mechanics.; 12/31/17, 6:29 PM
The Cracker Emcee Refulgent said...: Any responsible Cracker knows that you use a shotgun with birdshot for celebratory gunfire. Fire it over the roof of the barn for an added measure of safety.; 12/31/17, 6:31 PM
rehajm said...: Happy New Year everyone!; 12/31/17, 6:31 PM
Quaestor said...: That lil dood's heinie.

What kind of mage can't keep track of his nappy?; 12/31/17, 6:32 PM
rhhardin said...: I can record WWV's time signal plus the backyard bird microphone combined, but not every celebrant has a precise timepiece, which makes logging the distance away of each shot impractical. Five seconds per mile.; 12/31/17, 6:34 PM
rhhardin said...: You can do the distance-away thing with the Wednesday noon testings of tornado sirens though.; 12/31/17, 6:36 PM
David53 said...: Do you think Jeff Bezos could just buy North Korea in 2018?; 12/31/17, 6:37 PM
buwaya said...: Major market correction by Sept/Oct.
I'd give it 60%.
100% if things go badly for Republicans Nov.

I am hedged, but still very exposed. Can't avoid it really.

I did quite well with Ruger RGR; 12/31/17, 6:37 PM
rhhardin said...: Radio Japan says it's the year of the dog.

http://www.nhk.or.jp/rj/podcast/rss/english.xml

Get good luck dog-shaped bells at your local shrine or temple.; 12/31/17, 6:41 PM
Jaq said...: The fireworks are getting pretty annoying already.; 12/31/17, 6:44 PM
Michael K said...: Major market correction by Sept/Oct.
I'd give it 60%.
100% if things go badly for Republicans Nov.

If the polls look bad, I agree. If the Dims take Congress, or at least the House, the market correction will look like 1929.; 12/31/17, 6:49 PM
rehajm said...: Major market correction by Sept/Oct.
I'd give it 60%.
100% if things go badly for Republicans Nov.

Althousians have correctly predicted 500 of the last zero market crashes. I'll take the other side of that trade.; 12/31/17, 6:56 PM
rehajm said...: No family fireworks this year- too cold.

I watched Sydney Harbor on video this morning. It'll have to do.; 12/31/17, 6:58 PM
gspencer said...: "What are you seeing in that crystal ball?"

Another good year for Trump, meaning for us, for America

Another set of lessons that whatever the Democrats want or propose is dreck; 12/31/17, 7:08 PM
Greg Hlatky said...: Wild prediction for 2018: Hillary Clinton will not be president.; 12/31/17, 7:13 PM
Guildofcannonballs said...: I see little green monsters always darting just out of direct eyesight.

But you can hear 'em too. SSHHHH BE QUIET!!!; 12/31/17, 7:18 PM
bagoh20 said...: I'm very positive for 2018 becuase the economy runs on two things: freedom and optimism. Trump is very quickly advancing both. I only fear the stupidity of a chubby Korean with a ridiculous haircut. A coup there is a good bet for 2018. Kim has hired Russian bodyguards, becuase he can't trust his own. I'm not really sure that's any better. Ronery, so very ronery; 12/31/17, 7:20 PM
roger said...: For your reading pleasure:

https://www.pasadenastarnews.com/opinion/; 12/31/17, 7:21 PM
roger said...: specifically:

https://www.pasadenastarnews.com/2017/12/30/democrats-year-of-living-angrily/; 12/31/17, 7:22 PM
Big Mike said...: Manchin apologizes to his constituents for voting against Tax Reform. The apology is too little, too late, too irrelevant, and doesn’t save his seat. Tammy Baldwin, Heidi Heitkamp, Joe Donnelly, and three Democrat senators to be named later also have to find new jobs. Republicans win two of Tennessee, Arizona (Flake’s seat), and Nevada, but lose one in an upset. (Minor upset, if it’s Nevada.); 12/31/17, 7:28 PM
pacwest said...: "Major market correction by Sept/Oct.
I'd give it 60%.
100% if things go badly for Republicans Nov."

I'm dealing with a viscous cold/flu tonight, so maybe I'm missing something, but I'd give a 0.000% possibility that the major indices will go down to 0$.; 12/31/17, 7:29 PM
David53 said...: "I am hedged, but still very exposed. Can't avoid it really.'

Yeah, but it's been a great year!; 12/31/17, 7:31 PM
Marc in Eugene said...: 'Penrod' stories very amusing, yes; however, I don't think that they are suitable to be read in the public schools in these latter days.; 12/31/17, 7:33 PM
Unknown said...: Trump season 2 - the unpredictability avalanche; 12/31/17, 7:36 PM
bagoh20 said...: "I'd give a 0.000% possibility that the major indices will go down to 0$."

Agreed, but they could end up valued at a couple Bitcoins.; 12/31/17, 7:38 PM
Gahrie said...: but I'd give a 0.000% possibility that the major indices will go down to 0$.

He thinks that there is a 60% chance that the market corrects next year, not that the market will lose 60% of it's value. He thinks that there is a 100% chance that the market will correct if the Republicans lose control of the government.; 12/31/17, 7:39 PM
Richard Dillman said...: I admit to having read “Penrod.” Many of today’s young readers would probably find Tarkington’s work tedious and hopelessly outdated.; 12/31/17, 7:44 PM
Jaq said...: Probabilities say there has to be a correction. Not every stock that is along for the ride deserves to be there, even assuming that most of the prices are rational. But it's sort of like advertising. "Half of the money is wasted, but nobody knows which half."; 12/31/17, 7:48 PM
Jaq said...: People talk about the intrinsic value, or lack thereof, of bitcoin, but what is the intrinsic value of a stock certificate that doesn't pay dividends? I don't really know what people are paying for except the expectation that somebody will always buy it.; 12/31/17, 7:54 PM
Michael K said...: Penrod was something I read long ago. I wonder if today's kids can read Sherlock Holmes.

My youngest grandchildren get good grades but I wonder what that is based on.

I try to get them to read but sports are all the rage.

The lefties will complain I mention family, then post nasty comments about them.

They are sort of an informal opinion poll. They are of all political opinions. Their friends are also good sources of info.; 12/31/17, 7:56 PM
Mark said...: I had a rather audacious idea last night (although plenty of people have done such things before me) --

Should I take a day trip up from D.C. to go see Cav/Pag at the Met? It would be 4-5 hours to get up there and 4-5 hours back (whether driving, train or bus), but on Greyhound it would be only about $35 round trip (versus a few hundred bucks on the trail or even driving (tolls, gas and parking).

I saw Cavalleria Rusticana and Pagliacci years ago at the Baltimore Opera (I think it was them), but have never been to the Met. It would make for a long day -- out the door at 6 a.m. and not home until midnight, but you can sleep on the bus.; 12/31/17, 8:02 PM
Jaq said...: The other thing about Blade Runner 2049 was the extraneous inclusion of politics. The sort of evil character rants about the requirement for a “wall” between replicants and humans as a way to maintain “order.” It was a strained metaphor that had almost nothing to do with the movie, mostly it was a shot at Trump, as far as I could tell.; 12/31/17, 8:08 PM
Ann Althouse said...: Definitely do it, Mark. Great energetic starting of the year.; 12/31/17, 8:11 PM
William said...: Old saying: The market can remain wrong rather than you can remain right......My prediction of the coming year is that I will be wrong about a significant number of things, but I won't be wrong often enough to give my stupidity any predictive value.......Churchill said that he was wrong about half the things he believed but the problem was that he didn't know which half. I've got some things in common with Churchill.; 12/31/17, 8:13 PM
Mr. Groovington said...: This comment has been removed by the author.; 12/31/17, 8:14 PM
William said...: Rather s/b longer. I predict my copy editing skills will decline in the coming year.; 12/31/17, 8:15 PM
Jaq said...: Science discovers that Communism won’t work on account of chicks’ mating preferences.

These results indicate that higher economic status can offset lower physical attractiveness in men much more easily than in women. Neither raters’ BMI nor age influenced this effect for females rating male attractiveness. This difference explains many features of human mating behavior and may pose a barrier for male engagement in low-consumption lifestyles.

Save the planet and decrease income inequality, or get laid? Your choice gentlemen!; 12/31/17, 8:15 PM
Jaq said...: Marx proposed that women should become sluts with no standards so that men didn’t feel obligated to chase wealth. The problem is that women aren’t going to do that, and if a man can’t get wealth, well, he can always get power, and that attracts chicks too. Hence, Marxism is doomed to fail, or to produce a brutal dictatorship, due to it’s inability to deal with female hypergamy.; 12/31/17, 8:23 PM
Michael K said...: "Should I take a day trip up from D.C. to go see Cav/Pag at the Met?"

I will have to be satisfied with The Barber of Seville in Tucson.

The Arizona Opera stages the operas in both Tucson and Phoenix.

Life is good here. 75 today,; 12/31/17, 8:29 PM
Michael said...: Loved Booth Tarkington when I was a boy. Great stuff.

FMOC will raise rates two times in 2018
Market will correct with no attendant panic . Recover to current levels
Collusion will disappear from conversations
I will work less in 2018 but will make more money than I did in 2017
Bitcoin will taper off and stay around 12000
Blockchain usage will become better understood and trusted
Nothing will happen with NK; 12/31/17, 8:34 PM
Michael said...: Ah, and Republicans will retain control of Congress and the Senate; 12/31/17, 8:35 PM
n.n said...: This comment has been removed by the author.; 12/31/17, 8:39 PM
n.n said...: Republicans will retain control of Congress and the Senate

Maybe, if they place principles before principals, and comply with the religious/moral law: conservation of principles.; 12/31/17, 8:41 PM
Jaq said...: So, if I understand the latest Russia article from the New York Times, the crime is based on the idea that Russia hacked a server at the DNC that the DNC won’t allow law enforcement to even examine. Apparently Mueller, per the NYT, is taking the word of a company hired by the DNC that the Russians did it, even though their own timeline says that they kicked out the Russians before most of the really damaging emails were even written, and even though the evidence points to a leak.

And even though Donna Brazille’s book provides plenty of evidence of disgruntled Democrats at the DNC who could easily be imagined to have been motivated to leak the emails. The leaked emails largely had to do with DNC and press favoritism for Hillary, and actions that what we now know was the Hillary controlled DNC to damage Bernie’s campaign.; 12/31/17, 8:47 PM
LYNNDH said...: Sure hope your right Michael.
Yesterday, I was called a "racist, A-H"(not the initials either) by a white, middle aged woman because I took polite issue with her bumper sticker that said "Resist Trump". I said I embraced Trump, to which she took umbrage. One can hope 2018 might lessen the stupidity of the Left.; 12/31/17, 8:47 PM
tcrosse said...: World War III will be triggered by spell-check modifying a crucial word in an important communication.; 12/31/17, 8:50 PM
rehajm said...: I don't really know what people are paying for except the expectation that somebody will always buy it.

For an asset that has value but doesn’t pay a dividend there is a ‘dividend’- some other reason to hold it that econ calls convenence yield. Just like cash which people chose to hold over US Treasuries for some reason. atax avoidance, criminal activity etc may be enough. Greater fool theory probably accounts for the rest, as you suggest...; 12/31/17, 8:57 PM
YoungHegelian said...: @Tim,

The crime is based on the idea that Russia hacked a server at the DNC that the DNC won’t allow law enforcement to even examine.

Do you ever wonder what the DNC had on that server that they didn't want the FBI to see? Or, was the staff of the DNC so paranoid that they didn't trust the FBI, even though it was under their guys at DoJ?

Whatever was the reason, that they went with CrowdStrike and, in doing so, forever destroyed any chance of investigation by law enforcement just strikes me as one of the biggest mysteries laying out there in plain sight that no one has yet investigated.; 12/31/17, 8:59 PM
Big Mike said...: @Lynndh, nothing can lessen the stupidity of the left.; 12/31/17, 9:04 PM
pacwest said...: "He thinks that there is a 60% chance that the market corrects next year, not that the market will lose 60% of it's value."

Duh on me. I'm running a pretty high fever. It does give me insight into Inga's thought processes though.; 12/31/17, 9:26 PM
Jon Ericson said...: tcrosse said... [hush][hide comment]
World War III will be triggered by spell-check modifying a crucial word in an important communication.

I fear that you may be very close to the truth.; 12/31/17, 9:31 PM
Big Mike said...: Well, tonight represented the fizzling out of a strange year. I took the wife to a restaurant in downtown Winchester that had a special five course New Year’s Eve menu. We had never been there before, but TripAdvisor gave them something like 4.8 stars out of 5. I think we got there on the 0.2 night, because the service was terrible and the food was worse. Or perhaps “filet mignon” is French for “piece of stew meat.” Who knows?

Then when we got into our car and started to pull away from the curb a stranger opened the back door and started to climb in. I pointed out, in a loud and firm (but polite) voice that he was getting in the wrong car. Apparently an honest mistake because he apologized and moments later we saw him climb into the back seat of a similar, and identically colored, car. But for just a moment I thought our 2017 was going end with a carjacking.

I hope the rest of you are wrapping up 2017 with better food and less drama. Happy New Year to you all (now less than 90 minutes away here in Virginia).; 12/31/17, 9:40 PM
E-Dogg said...: Good evening—

Somehow I just happened to come across this blog. It was a specific posting from 2014, I believe. Anyway, I was delightfully surprised to see that this blog is still current. I am a new “fan” and will be around here sporadically.

Thank you for the words.

Sincerely,
Emily; 12/31/17, 9:56 PM
mockturtle said...: Happy New Year to all! And God bless you.; 12/31/17, 9:57 PM
FullMoon said...: For at least three decades scientists and environmental activists have been warning that the world is on the verge of a global warming “apocalypse” that will flood coastal cities, tear up roads and bridges with mega-storms and bring widespread famine and misery to much of the world.

The only solution, they say, is to rid the world of fossil fuels — coal, natural gas and oil — that serve as the pillars of modern society. Only quick, decisive global action can avert the worst effects of manmade climate change, warn international bodies like the United Nations, who say we only have decades left — or even less!; 12/31/17, 10:03 PM
MacMacConnell said...: eddie willers said...
"What a great illustration!

Google image search tells me it's J.C. Leyendecker"

Yes JC signed it. He was a famous advertising illustrator, mostly for his Arrow shirt ads of the 1920s and 30s. Have a great new year.; 12/31/17, 10:09 PM
Mark said...: Happy New Year, Emily!; 12/31/17, 10:10 PM
Carter Wood said...: This comment has been removed by the author.; 12/31/17, 10:25 PM
iowan2 said...: Good night all, See you next year.; 12/31/17, 10:34 PM
Carter Wood said...: This comment has been removed by the author.; 12/31/17, 10:35 PM
Carter Wood said...: Oh shoot. I had thought this was a 1936 edition looking forward to 1937, but I leaped a year ahead. Well, hate to waste a prediction:

1937 was the year of FDR's court-packing scheme.

2018 will bring the nation another fight over the Supreme Court as RBG can no longer resist the march of time. Trump garners* an opportunity to reshape the high court for a decade or more, and his opponents go DemCon 1. Democracy is further undermined as riots disrupt the economy and leftist Senators declare the Administration even more illegitimate.

* Vice President John Nance Garner actively opposed Roosevelt on the Judicial Procedures Reform Bill of 1937, creating a rift between the two. The result gave us Vice President Henry Wallace in Roosevelt's third term, the single most dangerous VP in U.S. history. Except for Burr, perhaps.; 12/31/17, 10:37 PM
Richard Dillman said...: I predict that 2018 will be unpredictable, even to Scott Adams. But we will be frequently surprised.

Happy New Year!; 12/31/17, 10:46 PM
glenn said...: WW2. If he had half a brain.; 12/31/17, 10:56 PM
walter said...: "And in the darkest night she takes a telescope
Looks through the wrong end and loses hope pointing at the nearest thing

[Chorus 2]
And strong winds are blowing through her hair
I reach, out to touch it but it's not there
Strong winds are beating down our door
Shaping our lives we never know what for"; 12/31/17, 10:57 PM
Mark said...: It's January! Happy New Month!; 12/31/17, 11:03 PM
walter said...: Just a reminder..Jan 9th is national Static Electricity Day.; 12/31/17, 11:09 PM
Bay Area Guy said...: @Carter Wood,

"The result gave us Vice President Henry Wallace in Roosevelt's third term, the single most dangerous VP in U.S. history. Except for Burr, perhaps."

He was either a Commmist plant or an unwitting dupe. Thank God some sensible Dems booted Wallace off the '44 ticket. He woulda been president.; 12/31/17, 11:10 PM
BudBrown said...: This comment has been removed by the author.; 12/31/17, 11:39 PM
narciso said...: In the novelization of the first episode of sliders, the first show that really explored the multiverse, our heroes come upon a world where the soviet's took over, they explain
the us lost the cold war, the first step was a president Wallace, then they mention Alger hiss as one of his successors.

Starting the year on a more positive note

www.americanthinker.com/articles/2017/12/looks_like_a_happy_new_year_for_the_forces_of_freedom.html; 12/31/17, 11:51 PM
sane_voter said...: Happy New Year to all Althouse denizens and our brilliant hostess!

I don't really get into New years as a festive holiday. Just another of many markers of time slipping away.; 1/1/18, 12:06 AM
narciso said...: No actually the times piece is a game of telephone, rat they concocted because the dossier was becoming too ridiculous. So in this story Papafob the would be oilman who never drew any wells talked to Alex downer the John Kerry down under about son info related to Hillary, a year before we has discovered the watercloset sever that lay bare her transactions through guistra UN Russia. Mind you that server wee likely hacked by a half dizen sources. But the emails came from another source, that wasnt known till arrange released them everyqhere. Very near beer.; 1/1/18, 12:28 AM
narciso said...: Wee likely, the story comes through Maggie haberman, the one who loved podestas rizzotto and Matt apuzzo, who helped shutter the demographic unit that could have been useful some months ago.; 1/1/18, 12:33 AM
narciso said...: Well that it for tonight, goodnight.; 1/1/18, 12:40 AM
Jon Ericson said...: Be at war with your vices,
at peace with your neighbors,
and let every new year find you a better man.

--Benjamin Franklin; 1/1/18, 1:20 AM
chickelit said...: ♫ I can't stand it I know you planned it
But I'm gonna set it straight, this Watergate
I can't stand rocking when I'm in here
Because your crystal ball ain't so crystal clear... ♫; 1/1/18, 2:12 AM
chickelit said...: mockturtle wished us...Happy New Year to all! And God bless you.

Back at you, mock. May you prosper in the new year.; 1/1/18, 2:19 AM
Clyde said...: Baby New Year's hat presaged the lava lamp by some thirty years...; 1/1/18, 2:20 AM
gadfly said...: Megan McArdle considers: Is bitcoin money, or a payment system? Mounds, or Almond Joy? Great taste, or less filling?

She concludes: none of the above. well, farewell, bitcoin, we hardly knew ye.

But don't miss the new way to slip ads into commentary:

The new TV series "Ozark" [on Netflix] has the best explanation of this I’ve seen in popular culture. To paraphrase: Say you have $1 million in cash. What can you actually do with it?

If you try to deposit it in the bank, they will file a report, and you will shortly be explaining to the government where that money came from. Unless you have a good explanation, you will then be desperately trying to hire a lawyer in order to avoid a trip to the pokey.; 1/1/18, 2:30 AM
Bruce Hayden said...: "Megan McArdle considers: Is bitcoin money, or a payment system? Mounds, or Almond Joy? Great taste, or less filling?

She concludes: none of the above. well, farewell, bitcoin, we hardly knew ye."

I would agree. What I do think that it is, is a bubble. One of the in laws explained over the holidays how and why they invested $500 they didn't have (as evidenced by their returning 500 rounds of 9 mm of mine to me as my Christmas present) in Bitcoin. No expert, but I do have an MBA and a lot of experience dealing with tech and tech startups, and their investment sounded brain dead.

For the most part, it makes a poor store of wealth. Everyone accepts dollars, Europeans also accept Euros. Etc. gold is still good, because of its stability and scarceness. Dollars, Euros, Rubles, etc also come in convenient amounts, ranging from 1¢ all the way up to $trillions$, and everything in between (in the case of $$$). What do Bitcoins have that these don't?

As for a payment system, Visa, MC, etc work great. Huge worldwide interconnected system. Also underneath is a way to dispute and reverse charges. We also have bank to bank transfers and checks. All very fast and efficient. Bitcoin is neither. Moreover, it doesn't appear to scale the least bit well. Scaling from dozens to thousands to millions to billions of transactions is important with payment systems. The only thing maybe going for it is its secrecy, but that comes at a price (besides slowness to clear an inability to scale well), and that is that Bitcoins contain their entire history, which means that if they are intercepted, they essentially show the fingerprints of everyone who has touched them since their inception.

If you are looking for the next generation of money and payment systems, I would suggest that the most likely source is going to be the tech giants like Google, Amazon, and Apple. Already have ApplePay, and Amazon gift cards can provide some anonymity. They take up much less room than cash, and can be sent electronically. And these companies have capitalizations exceeding that of some countries.; 1/1/18, 3:32 AM
rhhardin said...: The value of a stock is the present value of all the dividends it will ever pay; or, what is the same thing, the present value of all the earnings it will ever have.

Nobody knows what those will be, or how to discount to present value for the future.

But in particular it doesn't depend on the current dividend rate.; 1/1/18, 5:08 AM
rhhardin said...: Gold isn't a great store of value. Its value in inflation-adjusted dollars has fluctuated all over the place.

Except for taxes, short term Treasuries are probably the best store of value. Their yield is more or less the inflation rate, but you don't suffer much loss if the inflation rate goes up owing to their being short term. Long term bonds change in value hugely when the interest rate changes, short term bonds don't.; 1/1/18, 5:15 AM
rhhardin said...: Inflation adjusted long term treasuries (TIPs) are good for an IRA.

It has to be a tax protected account because they charge you real taxes every year on the gain from inflation but don't pay you the money to pay the taxes with; so no good for a taxable account.; 1/1/18, 5:18 AM
rhhardin said...: They started TIPs because the Fed wanted a clean market evaluation of expectation of inflation (by comparing its competitive yield with that of non-adjusted treasuries), but the IRS screwed it up by declaring you owe taxes every year on the gain from inflation.

So they don't provide the clean computation the Fed wanted after all.; 1/1/18, 5:22 AM
rhhardin said...: I-bonds (a type of savings bond) aren't bad to own. They mature in 30 years though so you'll owe taxes then. I think it's limited to buying $10k a year. They're inflation protected.

We're talking store of value, not speculation on future success.; 1/1/18, 5:41 AM
Jaq said...: The value of a stock is the present value of all the dividends it will ever pay; or, what is the same thing, the present value of all the earnings it will ever have.

That’s the rule everybody agrees to follow, I don’t see how it is remotely true though. It’s like a game that has a set of absurd rules that only makes sense if everybody “believes in” them. Do you think Apple is ever going to pay out all of that money they have? Or Google? Or do you think it is more likely that they will make errors in judgement at some point, and begin throwing good money after bad, and at some point, all they will have left is white elephant real-estate holdings, of which only the land has actual value?

That’s like saying in Poker, a “flush beats a straight,” as long as everybody agrees to the rules, you can take the money off the table when you have a flush and the other guy has a straight, but it doesn’t mean a flush has “intrinsic value.” Did RCA ever pay out anything equivalent to the value of it’s stock in the early days of radio? It’s a game based on artificial rules.; 1/1/18, 6:26 AM
Jaq said...: I think that the main difference between the stock market and bitcoin is that the absurdity is harder to see, from the investor’s POV. The stock market illusion does provide economic benefits, but like bitcoin, it sort of exists because money has to go somewhere.; 1/1/18, 6:30 AM
Jaq said...: The value of a stock is the present value of all the dividends it will ever pay; or, what is the same thing, the present value of all the earnings it will ever have.

You would think then that a properly priced stock would lose value every year.; 1/1/18, 6:31 AM
rhhardin said...: You would think then that a properly priced stock would lose value every year.

No, the future earnings become more valuable because they're discounted less each year.

The price isn't arbitrary agreements but competitive investments.; 1/1/18, 6:40 AM
Jaq said...: The stock market and bitcoin are “investments” in human nature, I guess, which is a pretty solid and constant thing which has a logic of it’s own, that isn’t really reducible to symbolic form for easy manipulation. Finally got to my “aphorism” and now I can let it go.; 1/1/18, 6:44 AM
rhhardin said...: Bitcoin has no earnings to support it. It's just a hope that it will stay money, and a speculation that it will do no worse than stay the same value in dollars.

Stocks are supported by earnings, which have the same units as value and so make sense.; 1/1/18, 6:48 AM
rhhardin said...: Treasuries are dollars, just out of circulation for a while until the treasury matures.

The out-of-circulation is why they sell Treasuries. They put your dollars out of circulation so that they can spend them themselves without inflating the economy.; 1/1/18, 6:50 AM
Jaq said...: No, the future earnings become more valuable because they’re discounted less each year.

Now that makes sense. Within the bizarro world that is the stock market. Kind of like the “rolling wave” theory of project management. You can’t plan too far ahead in a complex project because you have to wait for the unknowables to come into sight. That’s why ships have a steering wheel and you set a watch for icebergs, even though you know exactly where New York harbor is.

The price isn’t arbitrary agreements but competitive investments.

Right. The money has to go somewhere, so let’s invent a market and some rules and put it there, and we all agree to play by them. Not that the stock market isn’t a net good for humanity, unlike bitcoin, which seems like a casino that sucks vast amounts of energy.

Stocks are supported by earnings, which have the same units as value and so make sense.

It’s just that there is little guarantee, or incentive, for firms to pay out those earnings, so they may as well not exist, except as mutually agreed value cues. Probably because there is only so much money that dividend paying stocks can soak up and still make sense. The ocean of money that has to be accommodated is just too large for the market to handle in a “rational” way. There is so much money that even bitcoin has become a thing. The money has to go somewhere.; 1/1/18, 6:55 AM
rhhardin said...: It’s just that there is little guarantee, or incentive, for firms to pay out those earnings

Stockholders own the company. They vote on directors every year.

This usually shows up as a hostile takeover. Some company buys all the stock from the current owners at a good price and votes those shares against the directors.; 1/1/18, 6:58 AM
rhhardin said...: They don't have to pay the earnings, by they way. Some investors prefer reinvesting in the company. The earnings have to go somewhere, either to raise the value of the company through investing in it, or paying out to stockholders.

It's a matter of indifference which they do.

Nevertheless the present value of all the earnings and the present value of all the dividends are the same. Their time order is different, is all.; 1/1/18, 7:01 AM
Rusty said...: what will 2018 bring?
change; 1/1/18, 7:20 AM
Big Mike said...: @Rusty, change we can believe in?; 1/1/18, 7:28 AM
AllenS said...: 2018 will bring more of the same. For instance, Hillary won't shut the fuck up.; 1/1/18, 7:35 AM
AllenS said...: Brutally cold again this morning. Getting ready to go outside and feed the cats. Looking through the binoculars at the small building where I put the cat food, I see a dead black cat in front of it. Pretty sure it's the oldest cat, named Mom.; 1/1/18, 7:42 AM
Big Mike said...: Sorry about that, AllenS. I take it these are barn cats?; 1/1/18, 7:48 AM
AllenS said...: Yep, it was Mom. She must have just died, because she wasn't frozen stiff. The other 6 look healthy.; 1/1/18, 7:54 AM
AllenS said...: Yes, they are. I built them a nice house with a small entrance and a large pad inside, but Mom always slept in the barn. There still some loose hay in the mow.; 1/1/18, 7:56 AM
mockturtle said...: I'm sorry to hear of your cat, Allen. Sad way to start the year. :-(; 1/1/18, 8:45 AM