Fed rate increase = lower hifi prices?

It's the internet @soix, no worries. I find if you push smart people, it makes them think more and you learn more from them. I meant it quite honestly. I have no ego in this area and I did read everything you said looked deeper into some things I have not followed as closely as I could, etc. I have a financial advisor, I regularly talk to our economists and analysts are work because how and what we build is so tightly tied to related commodities, and do my own research.  My advisor encouraged me to invest more after the initial pandemic drop and he was absolutely right and I followed his advice. He thought I was taking too much of a risky position w.r.t. commodities late last year, but that turned out very well. I didn't follow his advice as well as I could w.r.t. Covid medical investments.  Any time human nature can play a huge role in the outcome, nothing is easy.

@deludedaudiophile

I find if you push smart people, it makes them think more and you learn more from them.

Case in point, you’ve got me thinking about the value of using the real earnings yield as part of an indicator. The thing is, you really can’t just use the earnings yield alone as an indicator because it’s always in the context of the current economic environment (i.e. an earnings yield of 5% with rates at 3% is completely different from a 5% yield with rates at 8%). So, to take that into account you need to view it relative to something like bond yields to see what it’s really signaling. I use nominal bond yields in our model so that’s why I’m using a nominal earnings yield, but if you’re up for it I’d highly encourage you to explore using the real earnings yield in some fashion to see if it offers useful predictive abilities. I’d certainly be interested in anything you find.

@soix ,

You have nothing to apologize for. If anything, hearing from you was educational and sobering.

All the best,
Nonoise

@deludedaudiophile hey, just as a rough idea and from a quick, off-the-cuff look, there might be some useful info from the real earnings yield. What I failed to realize initially, because I’m just not that smart, is that by using the real earnings yield you are inherently taking into account market conditions — duh. It appears that when the real yield goes negative it might be a good sell signal, and when it climbs back to 3% or so it might be a good buy signal. Could be wrong, but it sure seems like something worth looking into. The biggest problem is you’re beholden to current earnings estimates (or next year’s estimate if you’re using forward earnings), so any earnings revisions could lead to false buy/sell signals. Such is investing. Anyway, thanks for making me think. BTW, as a coincidence I used to work directly with Ed Yardeni — he was our economist when I was market strategist at Deutsche Bank.

I wanted to revive this thread,  I traded my CJ Classic 2se toward a DAC.  The dealer had it on his site by the time I got home.   I clicked on the ad this morning, less than 24 hours later and it was gone .   I clicked on several other items I saw in store yesterday and there were gone too.   They got $250 more than what I was trying to sell it for locally and gave me all the money for it.   Just shows that some brands retain decent value used.