The ultimate COVID thread

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Nobody knows where the bottom is.
I have been trickling in on the way down after we were 15% from highs. Taking 10% of my liquid assets and buying on big drops like today. Once the volatility subsides and we don’t get big swings, I will be more aggressive.
That is just my strategy tho. If the virus is tailored due to warming temps, I suspect things will bounce back. If it doesn’t behave like the flu, likely more pain ahead.
 
sevoflurane said:
Nobody knows where the bottom is.
I have been trickling in on the way down after we were 15% from highs. Taking 10% of my liquid assets and buying on big drops like today. Once the volatility subsides and we don’t get big swings, I will be more aggressive.
That is just my strategy tho. If the virus is tailored due to warming temps, I suspect things will bounce back. If it doesn’t behave like the flu, likely more pain ahead.
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Solid plan
 
According to new NYT report, a Brazilian official that met with Trump and Pence over the weekend at Mar-a-Lago has tested positive.

E2EE7B85-868D-4B84-B6B4-C1096ACB39BA.gif
 
Potentially naive question here, but if the market keeps dropping does it at all make sense to use loan money to invest in the market if the eventual correction will likely yield higher returns than the loan interest rate?

For context, I'm in my last months of residency.
 
hebel said:
Potentially naive question here, but if the market keeps dropping does it at all make sense to use loan money to invest in the market if the eventual correction will likely yield higher returns than the loan interest rate?

For context, I'm in my last months of residency.
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I knew people who did this in 2008. As for the details I’m not sure. But if you could get a loan at 3% you should expect a 20% ROI
 
Wkrdoc said:
You guys think we are near the bottom?

2008- financial/housing crisis. Government not as astute in printing money

2020- transient virus (even though we are likely in the 1st or 2nd inning). Government will stimulate, give tax breaks, delay fed taxes etc etc
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No but it's hard to tell where the bottom will be. I'm tending to buy some every 10% drop or so, however I'm guessing this will be prolonged just because of how it's going to paralyze the economy for a few months.

The fundamentals are still okay long term, I don't think there's going to be any soul-searching like in 2008 where it was "is the financial system itself going to collapse?". Then we literally had no idea how many financial products were backed by total **** housing loans that could never be repaid. The bond/credit rating system itself was in question.

A virus is running through the population that mostly kills people that aren't in the workforce anyway and isn't going to prevent people from going back to work eventually. What's going to hurt is all the loss of discretionary spending as we enforce social distancing and try to tamp down the epi curve. Like I said earlier, earnings reports for this quarter are gonna be brutal and we may see some companies that are highly indebted or barely profitable in the entertainment sector to go under or at least get bought up. I don't think the market is going to start recovering at least until then.

The people who are saying this is going to be a quick bounce back up are wrong. It's gonna come back up eventually but the loss of income/growth for all this entertainment being cancelled, business flights being cancelled, difficulty to do business between continents, loss of discretionary spending as people hole up in their houses and save in case they need it for the apocalypse, etc etc....is going to be huge. We're seeing unprecedented things happen in regards to entertainment/events (NBA canceled?? March Madness with no crowd? Summer Olympics in question?).
 
calvnandhobbs68 said:
No but it's hard to tell where the bottom will be. I'm tending to buy some every 10% drop or so, however I'm guessing this will be prolonged just because of how it's going to paralyze the economy for a few months.

The fundamentals are still okay long term, I don't think there's going to be any soul-searching like in 2008 where it was "is the financial system itself going to collapse?". Then we literally had no idea how many financial products were backed by total **** housing loans that could never be repaid. The bond/credit rating system itself was in question.

A virus is running through the population that mostly kills people that aren't in the workforce anyway and isn't going to prevent people from going back to work eventually. What's going to hurt is all the loss of discretionary spending as we enforce social distancing and try to tamp down the epi curve. Like I said earlier, earnings reports for this quarter are gonna be brutal and we may see some companies that are highly indebted or barely profitable in the entertainment sector to go under or at least get bought up. I don't think the market is going to start recovering at least until then.

The people who are saying this is going to be a quick bounce back up are wrong. It's gonna come back up eventually but the loss of income/growth for all this entertainment being cancelled, business flights being cancelled, difficulty to do business between continents, loss of discretionary spending as people hole up in their houses and save in case they need it for the apocalypse, etc etc....is going to be huge. We're seeing unprecedented things happen in regards to entertainment/events (NBA canceled?? March Madness with no crowd? Summer Olympics in question?).
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But are the fundamentals still good? Sure, it’s good for the anesthesiologist that can pour cash into the down market, but what about the hourly employees of all those arenas? The vast majority of people don’t have the cash on hand to weather a work stoppage for 2 weeks, let alone for months. We completely gutted our social safety nets and a crisis like this will show how that ripples through our economy. I just wonder if we’ll spend as much bailing out citizens as we did the banks?
 
GravelRider said:
But are the fundamentals still good? Sure, it’s good for the anesthesiologist that can pour cash into the down market, but what about the hourly employees of all those arenas? The vast majority of people don’t have the cash on hand to weather a work stoppage for 2 weeks, let alone for months. We completely gutted our social safety nets and a crisis like this will show how that ripples through our economy. I just wonder if we’ll spend as much bailing out citizens as we did the banks?
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It won't be good for the average guy I totally agree with that. Again though, those people (younger generally, healthy, likely to survive) are still gonna be looking for work after this rolls through the population, and I highly suspect the work will come back again. Probably a lot slower than it went away though.

Company fundamentals overall are still pretty good is what I meant. It's not like the banking crisis where we thought a whole sector of our economy was possibly built on a bed of mortgages that nobody would ever be able to repay. Companies have a lot of debt but if it starts getting bad, debtors (bondholders) are going to realize they have more to gain by easing up on the companies rather than pushing them into defaulting or bankruptcy.

I agree with the proposals that we should be putting cash directly into people's hands (instead of a stupid payroll tax cut) or making mandatory paid leave for the next 6 months for all employees who don't have paid leave currently.
 
calvnandhobbs68 said:
It won't be good for the average guy I totally agree with that. Again though, those people (younger generally, healthy, likely to survive) are still gonna be looking for work after this rolls through the population, and I highly suspect the work will come back again. Probably a lot slower than it went away though.

Company fundamentals overall are still pretty good is what I meant. It's not like the banking crisis where we thought a whole sector of our economy was possibly built on a bed of mortgages that nobody would ever be able to repay. Companies have a lot of debt but if it starts getting bad, debtors (bondholders) are going to realize they have more to gain by easing up on the companies rather than pushing them into defaulting or bankruptcy.

I agree with the proposals that we should be putting cash directly into people's hands (instead of a stupid payroll tax cut) or making mandatory paid leave for the next 6 months for all employees who don't have paid leave currently.
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I understand where you’re coming from, but how do you finance mandatory paid leave? I seriously doubt many businesses have the cash reserves to finance 6 months of mandatory paid leave. I genuinely wonder how many could even survive 1-2 months. I’m not a business owner so I don’t really know. I’d venture 90%+ of people in general haven’t saved up 6 months of an emergency fund—in our “spend now” culture, I just don’t see many businesses being in a much different boat.

I’m sure there will be more easing, but this is the problem running a perennial deficit. This will hit people hard, but as per the usual arrangement, no lessons will be learned by anyone.
 
Bloodbath. This isn’t over. The damage will take months to even see a partial recovery. I’m more pessimistic now that this will take 6-12 months before we bounce back to 2800. In the meantime 2150-2300 is highly likely before the bloodletting stops.
 
I just read page 1 and page 8. It's super interesting to see how wrong even the seemingly expert investors on this forum have been. Just goes to show that no one really knows and it's all really just a gamble. My guess is it'll bottom out around 14-15k then start some shoots and drops. In 2-3 years back to the 30k area. But who the F*** knows. No one knows. Some in my family pulled their assets out of the market at 29k, thinking 30k was just not realistic. They might've been right but who the F*** knows when they should put their money back in the market.
 
NicMouse64 said:
I just read page 1 and page 8. It's super interesting to see how wrong even the seemingly expert investors on this forum have been. Just goes to show that no one really knows and it's all really just a gamble. My guess is it'll bottom out around 14-15k then start some shoots and drops. In 2-3 years back to the 30k area. But who the F*** knows. No one knows. Some in my family pulled their assets out of the market at 29k, thinking 30k was just not realistic. They might've been right but who the F*** knows when they should put their money back in the market.
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While I didn't get in the thread til page 2 I stand by everything I said throughout.

Nobody should be too confident of their ability to predict the future. That said the market has been strongly valued for years and seemed like only a matter of time til a confluence of bad press and bad short term economic factors could converge and cause a big drop. I am strongly a stay the course type investor and don't particularly worry, but this is a huge deal in the short term. Right now the market moves are mostly based on panic of the unknown. Eventually once the panic subsides reason will take over and the market will rise but when that will be is anybody's guess. My personal guess is that we are still in the early phases of how this will play out and until the worst is over the market will not recover.
 
Mman said:
While I didn't get in the thread til page 2 I stand by everything I said throughout.

Nobody should be too confident of their ability to predict the future. That said the market has been strongly valued for years and seemed like only a matter of time til a confluence of bad press and bad short term economic factors could converge and cause a big drop. I am strongly a stay the course type investor and don't particularly worry, but this is a huge deal in the short term. Right now the market moves are mostly based on panic of the unknown. Eventually once the panic subsides reason will take over and the market will rise but when that will be is anybody's guess. My personal guess is that we are still in the early phases of how this will play out and until the worst is over the market will not recover.
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In the grand scheme if you don't plan on divesting from your 401k or other assets then staying the course is usually the right move long-term. Things like a pandemic should make you think twice though. This is going to get worse epedemiologically and probably economically as well.
 
This should make you rethink that 100 percent equity allocation most of you seem to believe in. It’s foolish to think that this type of volatility can’t happen again in 5 years. If you must be invested in equities then at some point be prepared for massive bear markets. It’s just part of the cycle/game.

The reason I’m optimistic looking 1-2 years out is due to history. The history of our markets shows we always bounce back especially with zero percent rates and 1.5 trillion in QE. Anyone cost averaging in now (today or tomorrow) will make a boatload of profit over the next 2-3 years. I’m predicting 75 percent gains from the intraday low tomorrow in just 2 years.
This panic is truly a buying opportunity but predicting the exact bottom is impossible. I’ll be happy to be fully invested at 2150 even if we go lower. Yes, I’m still buying as we drop each day until I’m out of bullets at 2150.
 
NicMouse64 said:
In the grand scheme if you don't plan on divesting from your 401k or other assets then staying the course is usually the right move long-term. Things like a pandemic should make you think twice though. This is going to get worse epedemiologically and probably economically as well.
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If this virus going around makes you change your thoughts on investing, then you had the incorrect asset allocation to start with. It's a stress test for your emotions. Long term investing outcomes depend more on your mentality than your intelligence. People who panic and sell when things go down cannot ever do well. I will be honest that I have not even looked at any of my investment balances this week. Just doesn't matter. I'm too far out from retirement to care what the number is and I'm smart enough to know that whatever % it dropped by this week is going to be more than offset by the increased future returns of new money compared to what I would have been expecting.

Put it this way, the S&P 30 years from now is going to be what it will be and that is unrelated to what it is now. The lower it goes now, the more the future gains will be. It's only when you get close to retirement that you need to pay attention but you can do that by changing your asset allocation slowly over time to be more and more conservative.
 
Times like these should make us feel blessed to be in medicine - a field where our services are desperately needed, we can help people out, and stay employed. I do think a lot of people will be without wages shortly, and that would be devastating. I’d hate to worry about losing my paycheck on top of all of this.

let’s just hope we all stay as healthy as possible during this pandemic. So far it seems working aged people should pull through.

Lastly, I feel this will probably cause the market to sink below 20,000 for the DJIA. Still, now looks like a nice time to start buying into the market if you can.
 
The key is to begin gradually changing your allocation as you reach your retirement goals. For those that maintain 100 equity allocation going into retirement this is a valuable lesson about how much the stock market can drop in 1 month.
 
Spikebd said:
Times like these should make us feel blessed to be in medicine - a field where our services are desperately needed, we can help people out, and stay employed. I do think a lot of people will be without wages shortly, and that would be devastating. I’d hate to worry about losing my paycheck on top of all of this.

let’s just hope we all stay as healthy as possible during this pandemic. So far it seems working aged people should pull through.

Lastly, I feel this will probably cause the market to sink below 20,000 for the DJIA. Still, now looks like a nice time to start buying into the market if you can.
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to be fair I am also concerned I will lose my paycheck for 2+ months when elective surgeries are all cancelled, but that's why I try to keep 18-24 months of emergency fund on hand (I mean that's not necessarily the reason but it sure comes in handy...)
 
Profile picture for The New York Times
Twitter › nytimes
The New York Times
Breaking News: U.S. stocks had their worst day since the 1987 stock market crash, with the S&P 500 now in a bear market. nyti.ms/2wPXF4P
 
BLADEMDA said:
The key is to begin gradually changing your allocation as you reach your retirement goals. For those that maintain 100 equity allocation going into retirement this is a valuable lesson about how much the stock market can drop in 1 month.
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100% equities is always a bad idea IMHO, but it's near criminal nearing retirement when you face the risk of sequence of returns risk. I mean if you were 100% equities and retired in January and planned on withdrawing 4% per year, your lifestyle just got a massive step backwards. On the other hand if you were conservatively allocated and taking maybe 3% you barely even notice this.
 
BLADEMDA said:
This should make you rethink that 100 percent equity allocation most of you seem to believe in. It’s foolish to think that this type of volatility can’t happen again in 5 years. If you must be invested in equities then at some point be prepared for massive bear markets. It’s just part of the cycle/game.

The reason I’m optimistic looking 1-2 years out is due to history. The history of our markets shows we always bounce back especially with zero percent rates and 1.5 trillion in QE. Anyone cost averaging in now (today or tomorrow) will make a boatload of profit over the next 2-3 years. I’m predicting 75 percent gains from the intraday low tomorrow in just 2 years.
This panic is truly a buying opportunity but predicting the exact bottom is impossible. I’ll be happy to be fully invested at 2150 even if we go lower. Yes, I’m still buying as we drop each day until I’m out of bullets at 2150.
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Just remember that last time we went as low as 800. 😉
 
Just found out my parents were very heavy in equities, and they could have retired in January had they wanted. Thought they finally rebalanced (at my pleading) last year. But my dad, a finance guy/CFO thought all was too well with the economy. Absolutely criminal to be that reckless; hope they enjoy working a few more years.

I’m 34 and 100% equities with little cash available (been making big loan payments), but I’ve got 30k tucked away in Ally savings I may end up tossing in a little each month. May also stop making those extra payments on my student loans, rates only 2.2%.
 
The market at these numbers are a far better deal than paying off student loans at 2.2 percent. But, once we reach 3,000 again (which we will) then I’d pause about using money set aside for debt or emergencies to invest in equities.
 
Shimmy8 said:
Just found out my parents were very heavy in equities, and they could have retired in January had they wanted. Thought they finally rebalanced (at my pleading) last year. But my dad, a finance guy/CFO thought all was too well with the economy. Absolutely criminal to be that reckless; hope they enjoy working a few more years.

I’m 34 and 100% equities with little cash available (been making big loan payments), but I’ve got 30k tucked away in Ally savings I may end up tossing in a little each month. May also stop making those extra payments on my student loans, rates only 2.2%.
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Do not touch emergency funds (have enough for 6-12 months). You don't know what the future brings. Investing in the market now can take years/decades to produce profits. Sh-t can happen. Covid-19 was a black swan, which can be followed by many others, for the simple reason that it will destabilize the world economically and politically. People who invested in the stock market in the early 1930s did not see the results for a couple of decades. Your investments may become worthless before regaining value; that's very hard to watch and tolerate, especially if it's your first time.

As the cynical among investors say: the night is darkest before becoming even darker. Don't worry about missing the bottom. Even if you invest at 20% higher, you will still make a TON of money if the market recovers. There is also a LONG way till the bottom. The market is still overpriced like hell; the P/E of the S&P 500 is still more than 15, and that's on last quarter's earnings. I would not invest until the pandemic gets under control. And I would NEVER invest more than what allows me to sleep at night; even if the market drops 20% in the following month (that's why I have been sitting in 40% cash equivalents for years).
 
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Zero percent interest rates. Trillions in QE. That means the market is cheap with a P/E of 15. I agree the real P/E is 50 right now so waiting for a real P/E of 8 won’t ever happen. The question is at what point stocks look cheap relative to 0.8 percent treasury bonds. I’d say a P/E of 15 with 2.5 percent dividends is solid ground in terms of equities. But, I do agree it may take longer than 2-3 months to see any meaningful recovery in the market.
 
1.5 trillion in QE (which given the deteriorating consumer fundamentals of a pandemic is like pouring gas into a car without wheels).....but a bit of student debt relief or taxpayer subsidized health coverage was the “crazy” idea this year
 
vector2 said:
1.5 trillion in QE (which given the deteriorating consumer fundamentals of a pandemic is like pouring gas into a car without wheels).....but a bit of student debt relief or taxpayer subsidized health coverage was the “crazy” idea this year
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Bernie? That you?
 
dr doze said:
Good grief stop being so dumb



Bomb Iranians. Perfect timing. Wag the dog. 😡
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Liberals being liberals, turning this into a political bash/blame trump moment. Don’t recall Obama being blamed for the swine flu
 
Wkrdoc said:
Liberals being liberals, turning this into a political bash/blame trump moment. Don’t recall Obama being blamed for the swine flu
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His response is to blame the Fed for not printing more money.
 
Wkrdoc said:
Liberals being liberals, turning this into a political bash/blame trump moment. Don’t recall Obama being blamed for the swine flu
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swine flu was a pig of a thing, but this coronavirus is the king of viruses
 
Wkrdoc said:
Liberals being liberals, turning this into a political bash/blame trump moment. Don’t recall Obama being blamed for the swine flu
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Obama didn’t deny there was an potential problem, congratulate himself multiple times on a “great job” while our county lags pathetically behind most other developed nations in diagnosis/case isolation.

btw I consider myself republican and voted against Obama both times. I would be delighted if Romney or McCain were managing this... just not this idiot who literally contradicts his top heads of science agencies at every turn.
 
So, FFP and Doze are correct. This will be a huge "2008 type" event which will likely take at least 1, if not 2 years, for the markets to recover. I've cancelled my pending orders but have spent half my dry powder already. I liquidated a bond fund and CD in order to raise more cash. I now have a nice stash of dry powder once the market bottoms. I'm going to actually wait for the bottom which will be an S and P of 2150. The pundits on TV are all doom and gloom but are positive we will retest 2350 in the next 1-7 days. 1/2 of them think we will fall to an S and P 500 of 2150. So, I'm going to wait this out until we approach 2200. I do think 2350 is pretty much a foregone conclusion at this point.

This is a true Bear market with a recession. FYI, some of my stocks are back to 2009-2010 levels so this is a real blood bath. Many good companies are down 50-60% from their highs already.

This lesson, March 2020, has taught me that I definitely do not want more than 55% equity exposure going into my retirement years. I still have time to recover completely (my time horizon is 3-5 years) from this Bear market but I'll need to re-balance aggressively out of equities once the Bull returns to Wallstreet.

As for FFP's comment on my feeling the pain I can assure him that every asset class I own is down from the highs except GOLD. Only Gold has truly held up in this bear market. My return from gold over the past 5-7 years is small but positive. That is not true for some other asset classes by the time this Bear market hits the bottom.

I still stand by my posts that the next few weeks is a fantastic investment opportunity for those with a 3+ year time horizon. Perhaps, the S and P 500 retraces all the way back to 1850 making this the third worst bear market of all time.
 
Look at the graph above. 2350 is pretty much a foregone conclusion (December 2018 lows) followed by 2100-2150. If we fall below 2100 the next re-test will be 1850.
 
Stock futures point to more losses Friday following market’s worst day since ‘Black Monday’
PUBLISHED THU, MAR 12 20206:05 PM EDTUPDATED 26 MIN AGO
 
For FFP I have a graph to show just how much lower we can go. We will use the 2014 market as a potential bottom because 2009 was a crisis of the financial system. The fear was the entire system was going to collapse. Covid 19 simply isn't at that level despite the hysteria and panic:
Note the number 1850. That was a level we re-tested several times over the years 2014-2016. If you are a true pessimist then 1850 is your market bottom. I prefer the 2150 level from 2016 but your guess is as good as mine. FYI, 1850 represents a 45% market decline from the recent all time highs.
2150 is more likely which represents a 35% decline from the recent highs. That is more in line with the expected Bear markets.

1584065862887.png
 
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Lol, “78%” approval guys, guess it’s all over pack it up.






But seriously, Trump is an irresponsible idiot and you’re an irresponsible idiot if you don’t vote for literally anyone else
 
vector2 said:



Lol, “78%” approval guys, guess it’s all over pack it up.






But seriously, Trump is an irresponsible idiot and you’re an irresponsible idiot if you don’t vote for literally anyone else
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Nope still wouldn’t vote for Bernie. I truly believe he would do more damage to the country (albeit with honesty and passion) than Trump horribly bungling a pandemic potentially killing an extra 50, 100 or 300k people.

Biden- yes. I will vote for someone with dementia over Trump which shows how low my opinion is of our president. I would also be just fine with a random pick from our population given how horrible our choices have become.
 
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