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Looking for Reasons to Sell?

Well we have had quite a ride lower today–based on Chinese AI? Or maybe based on the Columbian dustup. Or maybe there simply are lots of folks with big gains in big tech who are looking for a reason to sell. NASDAQ is off 3% and the S&P500 is off about 2% is what we know for sure.

Interest rates took the plunge with equity prices–now at 4.55%–down around 8 basis points.

The tumble in interest rates helped to negate the downward pull caused by the sharp tumble in stocks—meaning preferreds and baby bonds are relatively flat–or maybe up the smallest of amounts.

I notice that some folks are tip toeing into the political arena with their comments. It is unbelievably hard to avoid in the current environment, but do the best you can. I am watching comments as always–and may just on occasion delete any that get over the line too far. I am not going to delete stuff that has a little toe over the line–it is getting almost impossible to avoid.

12 thoughts on “Looking for Reasons to Sell?”

  1. Strange couple of days. I wasn’t really planning to sell, but I sold some – had some GTC’s fill on things like LPRDP at almost $27 (buying back cheaper) and some others I was looking to trim at the right price. Little spikes in prices did the job.

    Picked up some EIX debt at about 6.7%.

    1. King, Maybe Warren Buffet ? Think he still has a big stash he is earning good interest on.

  2. When NVDA loses the equivalent of Ireland’s or Sweden’s entire GDP in market value in 8 hours, maybe your stock is overvalued….

  3. Many tech stocks are overvalued right now with unrealistic short-term expectations for AI applications and because of that they make up a huge % of the SP500. AI is a long-term play that the market has unrealistically priced for the short term. It all depends on your investment horizon. If you believe in US tech companies for a 10-year+ horizon then u will have ups and downs but likely be rewarded. Forget politics, it’s all about being a disciplined investor and the willngnes to stick to your strategy.

  4. I placed market index purchases earlier today, (S&P and total) fxaix and fzrox, so they will fill after close since mutual funds in this case. Actually generally speaking I like Monday to purchase, seems often down. But not a timer. Before one knows it, today just a blip on the chart for e.g. S&P. Dow was up as all know. Nasdaq not a broad market but a sector, tech. The news is interesting though, the A1 tech from China cheaper and open sourced, and market taken completely by surprise today.? Hmmm. No one knew or anticipated before today, gotta wonder.

  5. I’ve been running the Deepseek R1 reasoning models locally on my 4090 since release last week. Even with a compressed model, I’ve been simultaneously impressed and perturbed by the logic in the chain of thought it provides.

    American AI giants when they are so awash in billions do not prioritize reducing spending cost, and they have been richly rewarded by the stock market for how much money they invest rather than the end results. Deepseek used a bevy of innovative techniques to significantly reduce training cost and revealed all their techniques in a white paper. Making it open source, this is such a monumental shift in the AI business.

    I hope nobody lost too much money today but I’m glad to see OpenAI’s closed model get knocked down with an open source one.

    (Note, I have minimal exposure to tech, just collecting my nickles from the Treasury, banks, utes, reits.)

    1. H-ster what I heard on the news today reminded me of the story I heard about how Google started. Instead of building a bigger is better computer system Larry Page and Serge Brin linked a bunch of inexpensive off the shelf computers to start their search engine. Similar to what these people thought of, Something no American AI developers thought to do.

      1. Rather like super-computers that were made by linking many processors- doesn’t seem that unexpected– but the techies love the new, shiny, pricey fast stuff.

      2. Charles,
        Decades ago, my company sold components to Google because they insisted on building all their own servers to save money. They never wanted anything “special”, just good quality at rock bottom price (I got dragged in because they wanted us to guarantee that we never sold to anyone on the planet at a cheaper price – which we wouldn’t do). They were also real sticklers about warranty. If a part with a 5 year warranty failed one day before the warranty expired, it was coming back for replacement.

        I have no idea whether they are still that frugal.

  6. Tragedy = Opportunity
    A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty, I am Azure

  7. Thanks Tim for this post. I sold one position today on a common Reit stock that is coming up on its x-dividend date. Another of those I wish I hadn’t bought and am weeding out. From reading the comments on here a lot of us are getting restless to buy something.
    Normally I don’t sell into a down market unless it is like the one we had in 2020 when there was the opportunity to move into higher quality that were at fire sale prices and we bet they would recover. Similar to the bank crisis but I had funds then so no need to sell anything at a loss.
    I’m glad you referenced the news as I was tempted to comment the price of my morning cupa Joe would be going up but I refrained.

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