Coronavirus

[stahleyp]

Health officials, scientists must get statements vetted by White House:  https://www.msnbc.com/deadline-white-house/watch/report-white-house-locking-down-messaging-from-federal-government-on-coronavirus-79563845972

 

Doesn't the Chinese government also do this?

 

So Pence becomes the filter through which information must flow, and Pence is the guy who penned an article stating that tobacco doesn't really kill people as claimed by the left wing media.

 

This is what a competent response looks like:

 

https://www.cnbc.com/2020/02/28/trump-chief-of-staff-mulvaney-suggests-people-ignore-coronavirus-news-to-calm-markets.html

 

White House chief of staff Mick Mulvaney on Friday suggested that Americans should ignore media reports about the coronavirus amid fears of the deadly disease spreading into the U.S.

 

Mulvaney, who also heads the Office of Management and Budget, also said that there will “probably” be school closures and transportation issues due to the impact of the virus.

 

Mulvaney claimed that the media has only started paying close attention to the coronavirus because “they think this is going to be what brings down” President Trump.

 

Coronavirus is not the reason to panic. More deadly is brain rot virus that has taken over the world with numerous cases reported in Washington, D.C., Moscow, and other capitals. What's worst, it's spreading over Internet! The only way to be safe is to unplug your ......................................................................................

 

An even more deadly version is in CA and NYC from my understanding. ;)

[Spekulatius]

Interesting factoids:

$PLWN ( funeral plot in LI) up 40% today, apparently expecting business to pick up.

 

$RGA - Life re-insurance company down substantially the last few days. They do not like the low interest rates and apparently Mr Market expects an increase in mortality as well.

 

No position in either one.

[sleepydragon]

Interesting factoids:

$PLWN ( funeral plot in LI) up 40% today, apparently expecting business to pick up.

 

$RGA - Life re-insurance company down substantially the last few days. They do not like the low interest rates and apparently Mr Market expects an increase in mortality as well.

 

No position in either one.

 

I can’t even login to my 401k account anymore.

 

[Gregmal]

Lot of misinformation and stupidity out there

 

https://nypost.com/2020/02/27/americans-are-avoiding-corona-beer-amid-coronavirus-outbreak-survey-finds/

[LC]

Another way to think of it is to break it up into its parts: an overall market correction + COVID 19's impact.

 

A lot of people had expressed concerns about market valuations two,three, four months ago. If COVID 19 didn't exist but we still had a market correction - what prices would be reasonable? Market multiples down from 24x to say 20x?  Then, layer the COVID 19 outbreak on top of that and ask yourself again, what prices seem reasonable?

[oddballstocks]

Interesting factoids:

$PLWN ( funeral plot in LI) up 40% today, apparently expecting business to pick up.

 

 

 

My guess is more due to the recent financials floating around.

[Viking]

Another way to think of it is to break it up into its parts: an overall market correction + COVID 19's impact.

 

A lot of people had expressed concerns about market valuations two,three, four months ago. If COVID 19 didn't exist but we still had a market correction - what prices would be reasonable? Market multiples down from 24x to say 20x?  Then, layer the COVID 19 outbreak on top of that and ask yourself again, what prices seem reasonable?

 

I am looking at it from four angles:

1.) market was up 35% from Dec 2018 to Feb 2020. Likely now fairly valued pre-virus.

 

Now let’s look at the impacts of the virus:

2.) current economic impact to China (GDP): bad and will take time for economic activity to recover; risk to downside (takes longer than a couple of weeks or a month for China to get back to normal).

3.) impact to global supply chain: bad and impact is only now starting to be felt. How many companies in China are still shuttered? How many are back up and supposedly running but experiencing staffing issues? Needless to say it will take some time to ramp up production. Companies outside of China are not issuing new guidance yet because they can’t quantify the issues yet; this will change and downward revisions to earnings and profits are coming in the coming weeks and perhaps months.

4.) economic impact of virus arriving in US in numbers: this will slow economic growth further

 

I do not think 2, 3 or 4 above are factored much into current stock prices. Needless to say, the next couple of weeks will be key. And this will likely take many months to play out with lots of downward revisions and ‘surprises’. I am now 100% cash. I was able to lock in a 1.5% gain for 2020 (and all my gains from a 10 year bull market). If markets go higher from here i miss some upside. If markets go lower i will be positioned well. May we live in interesting times :-)

[stahleyp]

Another way to think of it is to break it up into its parts: an overall market correction + COVID 19's impact.

 

A lot of people had expressed concerns about market valuations two,three, four months ago. If COVID 19 didn't exist but we still had a market correction - what prices would be reasonable? Market multiples down from 24x to say 20x?  Then, layer the COVID 19 outbreak on top of that and ask yourself again, what prices seem reasonable?

 

I am looking at it from four angles:

1.) market was up 35% from Dec 2018 to Feb 2020. Likely now fairly valued pre-virus.

 

Now let’s look at the impacts of the virus:

2.) current economic impact to China (GDP): bad and will take time for economic activity to recover; risk to downside (takes longer than a couple of weeks or a month for China to get back to normal).

3.) impact to global supply chain: bad and impact is only now starting to be felt. How many companies in China are still shuttered? How many are back up and supposedly running but experiencing staffing issues? Needless to say it will take some time to ramp up production. Companies outside of China are not issuing new guidance yet because they can’t quantify the issues yet; this will change and downward revisions to earnings and profits are coming in the coming weeks and perhaps months.

4.) economic impact of virus arriving in US in numbers: this will slow economic growth further

 

I do not think 2, 3 or 4 above are factored much into current stock prices. Needless to say, the next couple of weeks will be key. And this will likely take many months to play out with lots of downward revisions and ‘surprises’. I am now 100% cash. I was able to lock in a 1.5% gain for 2020 (and all my gains from a 10 year bull market). If markets go higher from here i miss some upside. If markets go lower i will be positioned well. May we live in interesting times :-)

 

I don't think I would be 100% cash even if I were pretty certain we were walking into a second Great Depression.

[boilermaker75]

Lot of misinformation and stupidity out there

 

https://nypost.com/2020/02/27/americans-are-avoiding-corona-beer-amid-coronavirus-outbreak-survey-finds/

 

I'm a beer drinker and I don't buy it. Not because of the virus, but because it is not very good.

[LC]

Lot of misinformation and stupidity out there

 

https://nypost.com/2020/02/27/americans-are-avoiding-corona-beer-amid-coronavirus-outbreak-survey-finds/

 

I'm a beer drinker and I don't buy it. Not because of the virus, but because it is not very good.

Just got back from the store and wanted to buy corona for the irony factor, but went with wine instead. Gotta be prepared! ;D

[Liberty]

Piece by Bill Gates:

 

https://www.nejm.org/doi/full/10.1056/NEJMp2003762

 

Meanwhile, Pence has already started the clamp down:

 

https://thehill.com/homenews/media/485147-rep-garamendi-nih-director-fauci-cancelled-on-five-sunday-talk-shows-after

[Spekulatius]

Anyone has any idea ( other than the 3:45PM ramp) why the index ended positive for the day, let me know.

[thepupil]

The fundamentals of the U.S. economy remain strong,” Powell said in a four-sentence statement Friday. “However, the coronavirus poses evolving risks to economic activity. The Federal Reserve is closely monitoring developments and their implications for the economic outlook. We will use our tools and act as appropriate to support the economy.”

 

Powell Put.

[stahleyp]

The fundamentals of the U.S. economy remain strong,” Powell said in a four-sentence statement Friday. “However, the coronavirus poses evolving risks to economic activity. The Federal Reserve is closely monitoring developments and their implications for the economic outlook. We will use our tools and act as appropriate to support the economy.”

 

Powell Put.

 

If the market doesn't rally on Monday, this could get pretty ugly.

[Spekulatius]

The fundamentals of the U.S. economy remain strong,” Powell said in a four-sentence statement Friday. “However, the coronavirus poses evolving risks to economic activity. The Federal Reserve is closely monitoring developments and their implications for the economic outlook. We will use our tools and act as appropriate to support the economy.”

 

Powell Put.

 

Reminds me of TARP in 2008. We really are in trouble.

[Cardboard]

This is all about duration and depth of this panic.

 

If you can judge this you are a lot better than I am but, that is really the key to determine if it is a garden variety correction or something much worst that contaminates loan process and generates another financial crisis.

 

A smarter man than I am who has 40+ years in the market said to never, ever buy anything (long) after an extended up market stretch. He was right once again.

[Sharad]

Anyone has any idea ( other than the 3:45PM ramp) why the index ended positive for the day, let me know.

 

I don't know why it went up, but I bought VIX put options (one week expiration at 3:50pm), seeing that Biden likely wins South Carolina, the White House/Federal Reserve/ECB/CDC/EU will announce some form of action (whether it actually can do anything is an entirely different thing), and the VIX was nearly 50 today, and though I see more downside for the next little while, even in October 2008, the market had massive gyrations up and down, and moments where things settled for a few days.

 

In any event, I suspect if you had a lot of short positions, then you couldn't go all-short into the weekend. People likely waited until the last minute to cover some positions or hedge out some short positions.

[LC]

This is all about duration and depth of this panic.

 

If you can judge this you are a lot better than I am but, that is really the key to determine if it is a garden variety correction or something much worst that contaminates loan process and generates another financial crisis.

 

A smarter man than I am who has 40+ years in the market said to never, ever buy anything (long) after an extended up market stretch. He was right once again.

Any chance he told you what timeframe constitutes an extended up market stretch?

[Sharad]

This is all about duration and depth of this panic.

 

If you can judge this you are a lot better than I am but, that is really the key to determine if it is a garden variety correction or something much worst that contaminates loan process and generates another financial crisis.

 

A smarter man than I am who has 40+ years in the market said to never, ever buy anything (long) after an extended up market stretch. He was right once again.

Any chance he told you what timeframe constitutes an extended up market stretch?

 

 

11 years 10 months and 13 days.

[ERICOPOLY]

Trump says that the flu has a higher mortality rate than the coronavirus.  The market should rally now.

 

[Jurgis]

Piece by Bill Gates:

 

https://www.nejm.org/doi/full/10.1056/NEJMp2003762

 

Go Bill & Melinda!  8)

[Liberty]

[Gregmal]

So, just to understand where people are coming from, and despite the internet muting my tone Ill say in advance that I am not being sarcastic or rhetorical, but... we have a pandemic that may temporarily dislodge tons of very significant economic variables. We just had, arguably one of the most hellacious and sudden market declines in decades, and both a President, who clear as day can not be deemed reliable, nor a media that can be trusted; people are surprised that the Fed is stepping up and willing to take action?

 

Isn't this what they have continually demonstrated that they will do? In who's interest, besides that of greedy investors, is it to have everything implode?

 

And again, as I said before, if we are talking valuations, we have a 1.2 10 year. Where should stocks be trading? Lets say you have a 30% cut to corporate earnings this year like some are modeling, ands then a 30-50% rebound the year after, should we be gapping down to 15x? Or is 20-25x depending on the business at least justifiable?

[LC]

 

Not the only time either.

 

https://a57.foxnews.com/static.foxnews.com/foxnews.com/content/uploads/2019/12/931/524/TrumpJentezenprayer1.jpg?ve=1&tl=1

 

https://www.au.org/sites/default/files/Trump%20and%20prayer%20day.png

 

https://static.independent.co.uk/s3fs-public/thumbnails/image/2019/11/01/15/trump-prayer-final.jpeg

 

Thoughts and prayers aren't going to help in a viral pandemic. Hopefully the CDC still has good people working on this.

[stahleyp]

So, just to understand where people are coming from, and despite the internet muting my tone Ill say in advance that I am not being sarcastic or rhetorical, but... we have a pandemic that may temporarily dislodge tons of very significant economic variables. We just had, arguably one of the most hellacious and sudden market declines in decades, and both a President, who clear as day can not be deemed reliable, nor a media that can be trusted; people are surprised that the Fed is stepping up and willing to take action?

 

Isn't this what they have continually demonstrated that they will do? In who's interest, besides that of greedy investors, is it to have everything implode?

 

And again, as I said before, if we are talking valuations, we have a 1.2 10 year. Where should stocks be trading? Lets say you have a 30% cut to corporate earnings this year like some are modeling, ands then a 30-50% rebound the year after, should we be gapping down to 15x? Or is 20-25x depending on the business at least justifiable?

 

The other issue is political. Sanders gets the nomination. Turns that into the Presidency due to a weak economy. His very anti-business slant and the dual force of higher inflation (student loan forgiveness, free everything) and increasing taxes. So we could very easily see higher inflation, higher taxes and higher interest rates and slower economic growth. An angry public will vote for someone else if the economy hits a pretty hard rough patch.

 

I'm not saying it's a huge chance of happening but certainly plausible.