491–499 of 499 posts
I have a "balanced" index fund with my retirement savings. I'm 33. I'm simply not touching a thing. I hope this is the correct move. It's amazing. I think I'm a pretty smart guy and I'm finding it very difficult not to second guess these choices. And the worst time to make choices like this is during financial crisis.
Earlier quoted context omitted.
Sorry to single you out, but the stock market usually trades in anticipation of recessions. It's not a proxy for the current GDP, it's an expectations market. The stock market could start a slow rise tomorrow and go until the end of the year and the entire year could be in a recession.
As a European it seems like the US markets are a step behind and seemed to trade pretty optimistically last week and especially the week before even though the situation was bad in Italy, for example.
Earlier quoted context omitted.
From my own comment: > the primary mechanism is "people can't work/aren't going out and buying things" As soon as it's safe, people will very quickly start working and consuming again. The world around that mechanism will have changed - some businesses will have closed, some jobs will have been lost, some personal finances will have taken a hit - but people's desire to work for income and spend money on goods didn't…
> As soon as it's safe, people will very quickly start working and consuming again. Your premise is at fault ("this is about buying goods"). The virus is a catalyst, not a cause. Do you know if the Chinese economy will ever recover in the way you claim? Are you even considering the world outside your country? This is bigger than a few people not going out to bars and restaurants. Industrial production has been slowin…
Disproportionately affecting people outside of prime working ages.
> political tensions are rising globally
For now, and they will eventually subside. Because they always do. And always will.
> Do you know if the Chinese economy will ever recover
Why wouldn't it (eventually)? Demand will change, but people aren't going to forget how to work, how to buy, or how to build. There is a _ton_ of cultural infrastructure that goes beyond physical infrastructure and ultimately, unless we were all building stuff nobody actually wanted or could use (e.g. dotcom bubble) the economy will eventually recover.
We don't know the timing, or the extent that bad assets will be kicked out (e.g. mortgages), and we also don't know to what extent money printing has erased savings, but ultimately there's a tremendous amount of cultural and physical infrastructure that will continue to exist, and a tremendous amount of demand that will return.
SPY puts printed today. Up 110%, sold before Trump had his press conference. I think there's going to be a little bit of a bounce tomorrow and then resume drilling.
Agreed. I had puts on TQQQ and also UVXY calls (yes, I play volatility like a madman). My last couple TQQQ puts sold today for....5100%
Earlier quoted context omitted.
> Now is not a good time to sell your stock holdings (at least not anymore). This smells of a panic right now. I'd love to make large buys of stocks at a time like this, but I have no idea whether my job/company/industry is safe. Last time I was laid off from work was particularly rough for me, and I'm only just now getting back on my feet. The uncertainty of the situation is probably making many others think twice b…
Nobody can tell you what will happen for sure, but it might be a good idea to look for businesses with large market caps and capital stores to deploy that will make it much more likely they will survive this period.
Earlier quoted context omitted.
The past is not a predictor of the future, 2008 is a single point hardly representative of any economic crisis to come. A lump sum invested in 1929 would have taken decade to recover, and with the Nikkei it still wouldn’t have. These models based on 1 or 2 selected crisis as if we had seen all always amaze me.
it’s obvious that past performance is not a predictor for the future. Yet, I could have said your same exact words in 2000 and 2008: “this time is different, let me go out of the market!”. I don’t know any other investment which is completely passive that will statistically allow me to grow my capital over the long term. So yes, I will rely on 100 years of data I have, and to prevent Nikkei I try to diversify using a…
Land, seeds, livestock and ammo. If you're worried that the market might collapse so hard that it won't recover in your lifetime, then trading money for lasting goods while money still has value is the best course of action.
Personally, I'm not convinced it's going to get that bad, but I have friends who have gone down that route. They all prefer their new lives to their old ones.
SPY puts printed today. Up 110%, sold before Trump had his press conference. I think there's going to be a little bit of a bounce tomorrow and then resume drilling.
Agreed. I had puts on TQQQ and also UVXY calls (yes, I play volatility like a madman). My last couple TQQQ puts sold today for....5100%
Earlier quoted context omitted.
repo markets don't help corporate debt at all, as long as the federal reserve don't accept the commercial paper (corporate debt, in other words). The moment the fed accepts commercial paper as collateral, yes, it does. However, this will lead to a bigger problem. If S&P drops ratings for many companies, many banks will end up holding bags; in which case, the fed will come to rescue these banks.
> "repo markets don't help corporate debt at all" I'm not sure I agree with this statement. The repo market may not help or hinder corp debt directly, but I think it very much so effects corporate debt. Corporations presumably get their loans from banks. What facilitates banks to make these loans? The Repo market. What happens if the repo market collapses / shrinks / endures instability? Banks most likely, would not…
What repos do: swap one kind of IOU (I owe you) with another kind of IOU. This doesn't make banks to issue new loans to distressed companies, any more than you/I can give loans to a dead beat. During good times, everyone is happy to issue loans.
Earlier quoted context omitted.
>I think a severe recession is all but guaranteed at this point Recession yes, severe, maybe not. (thought I admit the possibility) I think if the current distancing measures curtail the spread, then by July (maybe sooner) things could begin to inch back upwards. Then it's a matter of how much the next flu season impacts things, but by that time we should also be within 6-8 months or so of a vaccine. Recession for th…
You’re assuming things will return to “normal” after things start improving. Businesses, big and small, are going to take a huge hit from this that will take a long time to recover from. Probably more than most (all?) of is have seen in our lifetime. Seems like this is something we’ve never faced before, and it’s not that highly unlikely that we’ll see some pretty nasty and long-term impacts from this.