The ultimate COVID thread

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We'llBeDoneIn15Minutes said:
I didn't learn anything about technical analysis in college. I took that up when on my own I could see the repetition and looked into is this a real thing I'm observing. All I learned in college was that I was being taught garbage on the upper levels. Keynesian crap, stuff like wasting resources on war magically gets you out of economic depression. I knew it was all illogical and numerical trash so by graduation I lost interest in a career in economics. You seem very impressed with academia. I've spent enough time around it to realize it's like everything else, most are ordinary, some are very special. Look at Paul Krugman. Wins a Nobel Prize and couldn't be much of a bigger clown.
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I'm not impressed by academia, just pointing out it's basically a settled fact in the field that technical analysis does not work from a long term point of view. I assume most of us here are persuaded by science and fact.

I'm not trying to dissuade you from doing whatever you want to do. Have fun with it.
 
pgg said:
So, you're market timing.

If that's what you want to do, OK, I won't repeat the arguments against it. But maybe it'll help to step back, and before you click SUBMIT on the TSP web site, say out loud "I'm going to time the market because I believe I know something the market doesn't." And as that statement floats in the air around you, maybe you'll just close the browser window and go outside for a while. 🙂
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Well, thankfully I didnt do anything knowing I have till the end of the day to hit the submit button... Interest rates to 0 somehow just now and so I'll probably not do anything and just keep it the way it is.
 
Mman said:
I'm not impressed by academia, just pointing out it's basically a settled fact in the field that technical analysis does not work from a long term point of view. I assume most of us here are persuaded by science and fact.

I'm not trying to dissuade you from doing whatever you want to do. Have fun with it.
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Likewise 🙂
 
CardiacAnesThrowAway said:
Futures just opened, and are at -3%. Really early, obviously.
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Now close to -5%. Crazy we're not up 10% when the market should be impressed by how potus multitasked so well today. Interspersing corona updates with naked corruption, finger pointing, and Hillary/Benghazi rehashes is no easy task







 
pgg said:
So, you're market timing.

If that's what you want to do, OK, I won't repeat the arguments against it. But maybe it'll help to step back, and before you click SUBMIT on the TSP web site, say out loud "I'm going to time the market because I believe I know something the market doesn't." And as that statement floats in the air around you, maybe you'll just close the browser window and go outside for a while. 🙂
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I believed in an efficient market until this pandemic. Now I realize how clueless the traders really are.
 
Deanmonster said:
I believed in an efficient market until this pandemic. Now I realize how clueless the traders really are.
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Approximate quotes from memory:

On most days, the stock market is a voting machine. Once in a while, it becomes a weighing machine. (Ben Graham)

When the tide goes out, we'll see who is swimming naked. (Warren Buffett)

First they said that I was a one sigma-event, then two sigma, then three sigma, now I am a six sigma event. (Warren Buffett, about being an "exception" to the efficient market hypothesis, sigma being the standard deviation. Six sigma is one in 500 million.)
 
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FFP said:
Approximate quotes from memory:

On most days, the stock market is a voting machine. Once in a while, it becomes a weighing machine. (Ben Graham)

When the tide goes out, we'll see who is swimming naked. (Warren Buffett)

First they said that I was a one sigma-event, then two sigma, then three sigma, now I am a six sigma event. (Warren Buffett, about being an "exception" to the efficient market hypothesis, sigma being the standard deviation. Six sigma is one in 500 million.)
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IF Financial history has taught us anything is that extreme events are not normally distributed. See also LTCM, Asian Currency Crisis, Global Financial Crisis. AKA Fat Tails. Lots of these risk models simply assume that things will only get a little worse than historical averages then add a safety factor of 20% or so and lever up the bets. It works great more than covering expense ratios. Until it doesn’t. People mistake leverage for skill all the time. Unknown.png
 
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dr doze said:
IF Financial history has taught us anything is that extreme events are not normally distributed. See also LTCM, Asian Currency Crisis, Global Financial Crisis. AKA Fat Tails. Lots of these risk models simply assume that things will only get a little worse than historical averages then add a safety factor of 20% or so and lever up the bets. It works great more than covering expense ratios. Until it doesn’t. People mistake leverage for skill all the time.
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People mistake luck, too, for skill all the time (not that it's the case with great investors who keep performing for many years).

The EMH is a nice theoretical concept. In practice, it's absolutely untrue (not only in times of crisis). But it's still being taught by geniuses who couldn't make a living in the stock market. The market is much more of a voting machine than a weighing machine, much more irrational than EMH proponents would like us to believe.
 
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txhorn said:
hmm, not sure how market is going to react. we saw a pretty big drop after the last rate cut
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Stock futures drop — hit ‘limit down’ — even as Fed slashes rates; Dow futures off 1,000 points
PUBLISHED SUN, MAR 15 20206:01 PM EDTUPDATED AN HOUR AGO
 
2350 in the s and p 500. That's the critical number. I bet we come close in the next 5 trading days.

To be sure, MKM Partners’ JC O’Hara thinks the market may be getting close to reaching a bottom as sentiment keeps dropping and technical signals “suggest a selling climax is near.”

“We believe the conditions are such that we are closer to a sentiment low,” the firm’s chief market technician said in a note Sunday. “Market bottoms are often made with two distinct lows; a low in price and a low in sentiment, and they don’t always occur at the same time. Both are needed before stocks can move higher.”
 
I feel like I've made some major mistakes in my investment strategy.

I have way too much debt, and while I have equity in investments (real estate) -- I'm wishing I had no debt and had cash ... I think I'd like to go find a remote island and count my money.
 
If you had a diversified portfolio of 70/30 or 80/20 then this storm could be weathered easily. I am able to go from 60/40 to 80/20 as we approach 2300. This way I’m able to cost average down.

In addition having no debt with cash reserves makes coping with a market crash more tolerable.
 
Is anyone using this opportunity to refinance a mortgage? I bought my house during one of the rare times recently that rates were well over 4%. Mine is 4.3%. I’m looking to refinance to a 15 year below 3%. The question is, should I take some cheap cash out with the refinance?
 
Is anyone shorting? Seems like the general consensus is that the market will head down further. If you are so confident of the further drop, why not short the market and make money as the market drops?
 
JobsFan said:
welcome to the uneasy feeling of being right when you wish you were wrong.
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For anybody not retiring in the next 5 or 10 years, the lower the market goes the better it is for them. Since I am not that close to retirement every drop of the market is a net good for me. If it drops low enough, it might be able to let me retire a year or two earlier. I get excited when it has 10% down days.
 
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GravelRider said:
Is anyone using this opportunity to refinance a mortgage? I bought my house during one of the rare times recently that rates were well over 4%. Mine is 4.3%. I’m looking to refinance to a 15 year below 3%. The question is, should I take some cheap cash out with the refinance?
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the problem is that banks are flooded with refinances right now. Searching bankrate shows me worse rates available now then you could get 3 months ago because they simply don't have the manpower to finish the work they have. Wait for that glut to clear and then refi rates will tank as they compete for what is left.
 
GravelRider said:
Is anyone using this opportunity to refinance a mortgage? I bought my house during one of the rare times recently that rates were well over 4%. Mine is 4.3%. I’m looking to refinance to a 15 year below 3%. The question is, should I take some cheap cash out with the refinance?
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I’m no financial expert, but I think the ship might’ve sailed a couple of weeks ago to get the super low rates. I thought about doing it a month or so ago but was too busy to follow through on research. But a financial message board I’m on on Fri said the rates have gone back up with everything going on and aren’t super low anymore. Are you still seeing below 3% today? If so, then I’d definitely go for it.
 
AMEHigh said:
I’m no financial expert, but I think the ship might’ve sailed a couple of weeks ago to get the super low rates. I thought about doing it a month or so ago but was too busy to follow through on research. But a financial message board I’m on on Fri said the rates have gone back up with everything going on and aren’t super low anymore. Are you still seeing below 3% today? If so, then I’d definitely go for it.
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I saw 2.8% for 15 year fixed as recently as Friday. I haven’t looked yet today. I have heard the mortgage companies are inundated with applications right now and thus have raised rates. I fully expect (or hope) rates drop again as this drags on for a few more weeks.
 
GravelRider said:
I saw 2.8% for 15 year fixed as recently as Friday. I haven’t looked yet today. I have heard the mortgage companies are inundated with applications right now and thus have raised rates. I fully expect (or hope) rates drop again as this drags on for a few more weeks.
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rates usually track the yield on the 10 year treasury and that isn't going to skyrocket anytime soon so as soon as their pipeline dries up, mortgage rates will quickly follow back down. It's definitely just keeping them artificially high right now because they have more work than they can handle. I personally expect lots of rates below 3% within next 3-6 months.
 
facted said:
3-4k elderly?!

This has the potential to kill a few million Americans and if you don't see that yet, I can't help you. The data is right on front of you.

It's logarithmic spread in every affected country except SKorea basically.
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You are arguing with a brick wall.
 
SaltyDog said:
Well if the virus had truly been circulating in the community unfettered for 6+ weeks, and these are the numbers, I find that somewhat reassuring.

(He says while knocking on wood)
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420 as of March 15

publichealthinsider.com

Update on COVID-19 in King County for March 15, 2020 – PUBLIC HEALTH INSIDER

Summary: Public Health reminds our community to respond to the need for blood donations. We are announcing several suspensions of in-person Public Health service desks. We are reporting 32 new cases today, bringing the confirmed case count total in King County to 420. In addition, two new deaths...
publichealthinsider.com publichealthinsider.com
 
nimbus said:
420 as of March 15

publichealthinsider.com

Update on COVID-19 in King County for March 15, 2020 – PUBLIC HEALTH INSIDER

Summary: Public Health reminds our community to respond to the need for blood donations. We are announcing several suspensions of in-person Public Health service desks. We are reporting 32 new cases today, bringing the confirmed case count total in King County to 420. In addition, two new deaths...
publichealthinsider.com publichealthinsider.com
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Still not logarithmic spread. Still reassuring that only new deaths are from the nursing home patients.

:xf::xf:
 
Mman said:
For anybody not retiring in the next 5 or 10 years, the lower the market goes the better it is for them. Since I am not that close to retirement every drop of the market is a net good for me. If it drops low enough, it might be able to let me retire a year or two earlier. I get excited when it has 10% down days.
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i’d still rather have been wrong about this ...
 
I've got a very long investment horizon ahead of me. I just keep putting money into my Roth IRA, 100% in VTSAX á la J.L. Collins. I say let it keep falling!
 
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So, how long can all doors of economy be closed before the Civil Unrest starts? Predictions?
 
FFP said:
Two words: National Guard. There won't be unrest because gatherings won't be allowed. Already it's 10 people or less.
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agree - but i think people will want me to change my username to chickenlittle as it is - so didn’t post it
 
FFP said:
Two words: National Guard. There won't be unrest because gatherings won't be allowed (hence no mob). Already it's 10 people or less. They can whine on social media.
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they’re two very big words
 
JobsFan said:
my guess 1 month
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Sounds like a really good estimate. They are talking about carrying this out to July or August. I don't think the National Guard is nearly large enough to shut down the entire country with widespread unrest, though I admit that's a gut instinct not based on statistics.
 
We'llBeDoneIn15Minutes said:
Sounds like a really good estimate. They are talking about carrying this out to July or August. I don't think the National Guard is nearly large enough to shut down the entire country with widespread unrest, though I admit that's a gut instinct not based on statistics.
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Other countries have given police powers to their militaries. Everything is possible in times of war.
 
FFP said:
Other countries have given police powers to their militaries. Everything is possible in times of war.
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... or in time of mass civil unrest. This is the *active duty* 82nd Airborne, US Army, brought in to quell the post-Katrina civil disobedience. In an American city.

Some snowflakes or otherwise-entitled folks in this country with the attitude, “I’m an American and can do whatever the fu(k I want” might be in for a little civics lesson in the near future.
6B1DA7A0-7A3D-4359-A287-E4B87675C7DB.jpeg
 
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We'llBeDoneIn15Minutes said:
So, how long can all doors of economy be closed before the Civil Unrest starts? Predictions?
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The classic answer is nine missed meals, and I believe that.

But there's no indication that the food supply chain will be interrupted. Even in Italy the grocery stores are all open and full of food. The people who grow the food, process the food, and move the food aren't the demographic at most risk. The power is on, the internet works, trash is getting picked up, clean water comes in, sewage goes away.

The risk lies in people who live paycheck-to-paycheck, with no emergency fund, with maxed out credit cards ... which is a whole lot of people. Food on the shelves doesn't mean much if people can't buy it. But that's a problem the government can handwave away, for a while, by extending credit or grants.

Civil unrest is not something I'm real worried about.
 
Monty Python said:
... or in time of mass civil unrest. This is the *active duty* 82nd Airborne, US Army, brought in to quell the post-Katrina civil disobedience. In an American city.

Some snowflakes or otherwise-entitled folks in this country with the attitude, “I’m an American and can do whatever the fu(k I want” might be in for a little civics lesson in the near future. View attachment 298735
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Post Katrina and post Rodney King took days to quell. Civil Unrest would spread like wildfire if it occurred. Shutting that down across the entire country would take a while. We're talking about the government.

I don't think this virus is potent enough to cause that scale of unrest. But I don't put anything past government incompetence causing that, such as a 6 month shutdown of the economy. There's not enough, hardly any actually, reserve in our treasury to ride that out smoothly.
 
We'llBeDoneIn15Minutes said:
There's not enough, hardly any actually, reserve in our treasury to ride that out smoothly.
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I'm not sure what this means. Greenbacks aren't exchangeable for gold bricks any more. They just QE'd $700 billion the day before yesterday.
 
nimbus said:
It is telling that this thread has turned away from this. 12% drop is not even noteworthy at this point.

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Oh no. Goldman Sachs is predicting up to another 15% lower from here until we hit bottom. Remember that S and P 1850? There are traders that say the true bottom is 2008 type pain putting the bottom at 1700! I think 1850 will hold and Goldman is likely correct around S and P 500 of 2000. I have my orders ready to trigger at 2150 even though the market could go much lower. This is similar to what I did in 2009 when I went "all in" January 2009. I missed the bottom by a wide margin. I'm "all in" (90% equities) at 2100-2150 so I may miss the bottom again if we do indeed test the 1850 level. 1850 is where the market hovered around for several years before breaking out. With this deep of a recession I can easily believe 1850 as I was way too optimistic that 2500 would hold. This is 2008 type event of panic/fear with a deep recession for several quarters or even a full year.

Since I'd rather be invested a little early I am confident that 2150 represents a level that the USA should be able to improve upon as the fear dies down and a vaccine is announced. Nobody can predict the exact bottom but 2150 invested in the S and P 500 in addition to 5 blue chip growth companies should provide a nice gain for me over the next 3 years.
 
Dow futures jump 200 points after Wall Street suffers worst day since 1987 market crash


That level will not hold. The market will go lower over the next few days/weeks. There is no good news. Panic and fear abound without a workable vaccine. Do not buy into this "glitch" as sentiment is extremely bearish. That said, I picked up Facebook, Visa, Amazon, Google today and have orders out to buy Honeywell, more Facebook, Amazon below 1580, Google and MSFT. In addition, large amounts into an S and P 500 index fund as we hit 2150.

This is the time to buy the best companies at great prices. I'm seeing some stocks lose 5-7 years of returns in just days. Boeing has been obliterated and may go below 100 before this is all over. Here is a chart of Boeing and if you have the nerve this stock may recover to 350 per share in just 2-3 years. I'm only buying blue chip growth companies with reasonable debt on the books that should bounce back in less than 6 months. Boeing and to a lesser extent CAT are longer term plays.

FYI, the chart below is inaccurate as Boeing is down even more today.
 
I want to buy Starbucks for about $42-$45 per share. I bet it goes there. I bought some Citigroup and Bank of America along with JPM. I think C is cheap and at $35 per share I could double my money in 3 years.

Disney? That's a buy at $80! Just look at the long term chart. I just don't have enough cash to buy all these great companies so I purchase solid ETFs along with stocks. Verizon anyone? How about Chevron? Chevron is the best long term oil play in the industry with a great yield. XOM has been left for dead and lost more than decade of stock appreciation. Sadly, oils are too risky when all the other stuff is also on sale.

Is this a 2008 type event? You bet your stock portfolio it is.
 
Disney has lost 5 years of stock appreciation in 1 week. I bet you will be able to buy Disney for $85 or even $80 before this crisis is over. Look at the chart below and then decide if in 3 years Disney will be worth $110-$120 with its fantastic movie and streaming services:

1584402648835.png
 
CVX and XOM also may have to cut dividend. That possibility is somewhat priced in but they’ll fall more if it does happen.
 
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