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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: sense who wrote (197210)	3/14/2023 10:58:21 AM
From: carranza2	Read Replies (1) \| Respond to of 219988

Schwab was a screaming buy yesterday. Almost pulled trigger, got distracted by real work.

To: sense who wrote (197210)	3/14/2023 1:05:26 PM
From: sense	Respond to of 219988

At a PE of ~20 ? What was a reasonable PE to make banks a screaming buy... the day after Lehman ? In 1999-2000 and in 2008, Schwab made very nice "bat ears" double tops... just like today. (Easily enough seen on a Yahoo Finance chart at the "max" setting). In each of those prior bubbles, Schawb share price fully retraced the full span of its rise into the double top before being "a screaming buy"... which today would mean... Schwab at around $13 or $14... Maybe spot them a point or two for inflation... but, otherwise, the "upside" is based in believing... the bubble we're in now isn't done yet... and has another leg up. That narrative probably died this week ? For now, the bias in rate reductions will likely be focused on "preventing the wheels from coming off" not "driving another leg higher" ? We've already had too much of that this cycle... interventions thus far have imposed a > 6 month post peak "pause" in the ongoing market decline... and, that's probably all we see today... is not retail racing back in to put money at risk in the market... but... "the control levers" being manipulated to enforce "discipline"... requiring price discovery is suspended... until the "control" is removed... But, you might be right... they could spin rates back below zero... as some suggest is necessary just to keep things from blowing up... And, if they do that, it might force prices higher... in another bubble built on top of the one we have... and with that still not inducing me to want to own it... Macrotrends charts historical PE... which I expect is a useful view of it if considering "an investment"... As a trade... buy it at $46 on Monday, sell it at $56 today... and, yeah, that's a good trade. No quibbles. But, if not running charts to trade... do I want the holding risk ? Not a snowballs chance... Schwab is a great proxy for "retail interest in the stock market"... and... what does that look like now ? I think you don't even begin to "wait for it" until PEs are back in the 12 to 15 range... But, note in looking at charts of the values... price and PE... that PE isn't a static self referential figure like price... so, needing to anticipate where the puck is going to be, parsing future earnings at Schab... as retail investors learn, as they do every cycle, that you can lose money in the stock market. Look at the history in revenue... and you see a one way ramp into a 5X over the last 12 years. Is that pattern sustainable ? As always, "it depends"... on how well the economy is doing... how comfortable retail investors are in stocks... how much money is being created to support the bubble at a given time ? But, that's what happens at bubble peaks... is people projecting historical trends as sustainable into the future... when reality is not cooperative. Otherwise, the trading history and the maths are simple enough... take the price at the peak and divide by 2, and take the price in between the bat ears, and divide by 3... and that's your "target price range"... currently $21 to $42... while veteran bottom fishers will wait for a bottom... down around $13 to $14... that difference in the range between ~$14 and ~$42... being a 3X... is pretty much "normal" market valuation variation ? Normalcy bias... the herd following trends... and people being bad at math... is all you need to explain that function...