Jurgis Posted April 13, 2020 Share Posted April 13, 2020 I am thinking that lower density areas that do well in this epidemic might do well in terms of housing because older folks (who tend to have money), might want to move there. Buy a cabin in the woods in upstate NY or Vermont or maybe around Flagstaff in AZ. Good hospital nearby a strong plus. People might look at COVID-19 maps rather than school districts (which don’t matter since kids are out of the house). I know similar things have occurred after the two wildfire season in CA. Thoughts? I haven't heard anyone thinking in this direction so far. I think it will depend a lot on how the pandemic progresses and ends. There are couple overlays that affect what you suggest: - Exurbs are cheaper and low density states have (generally) been cheaper. So older folks who don't have to live in cities could have migrated to exurbs and low density states already. Some have. But there's a lot of reasons why others haven't. Among these are community, services, and overall low geographical mobility (geographical mobility apparently is quite lower than people think). - Maine, Vermont and probably upstate NY have been losing people. This might not reverse the trend. Link to comment Share on other sites More sharing options...
Spekulatius Posted April 18, 2020 Author Share Posted April 18, 2020 I am thinking that lower density areas that do well in this epidemic might do well in terms of housing because older folks (who tend to have money), might want to move there. Buy a cabin in the woods in upstate NY or Vermont or maybe around Flagstaff in AZ. Good hospital nearby a strong plus. People might look at COVID-19 maps rather than school districts (which don’t matter since kids are out of the house). I know similar things have occurred after the two wildfire season in CA. Thoughts? Redfin is seeing a trend. It may not last, but nevertheless interesting: https://www.cnbc.com/2020/04/17/redfin-ceo-rural-home-demand-shows-profound-psychological-change-amid-coronavirus.html Link to comment Share on other sites More sharing options...
SharperDingaan Posted April 18, 2020 Share Posted April 18, 2020 I am thinking that lower density areas that do well in this epidemic might do well in terms of housing because older folks (who tend to have money), might want to move there. Buy a cabin in the woods in upstate NY or Vermont or maybe around Flagstaff in AZ. Good hospital nearby a strong plus. People might look at COVID-19 maps rather than school districts (which don’t matter since kids are out of the house). I know similar things have occurred after the two wildfire season in CA. Thoughts? Seniors move to rural areas because living costs are cheaper. Then die quicker - because the medical facilities are sparse, equipment is inferior relative to city facilities, and there aren't the doc's/support staff available. Eventually they move to a retirement home in a rural town centre, where the cycle repeats. Hence the old adage, WHERE you get sick, matters. Ultimately, every senior is deciding between 'quality of life' versus 'longevity of life' - and over ever shortening time horizons. Hence, the decision to live in a Flagstaff, Boulder, etc. is really about maximizing 'quality of life'. Enjoy remaining years to the fullest, live longer by being more active, and die a quick death on your own terms. Ideally .... as an actuarial abnormality! No real change, to what is already occurring. SD Link to comment Share on other sites More sharing options...
Spekulatius Posted April 19, 2020 Author Share Posted April 19, 2020 A lot of money in the lower income bracket are going to make more money for doing nothing than they made before working. https://www.masslegalhelp.org/covid-19-unemployment UI benefits + $600/week extra and extra $2400/ month. UI benefits are roughly 1/2 the prior salary, up to a certain limit. So, unless you made more than roughly $4800/ month before, you might be better of not working for a couple of month. Unless, I read these these provisions wrong. It’s quite interesting, my wife works only 1/2 time (more with overtime typically) and may actually be better of not working - as a nurse? Maybe America doesn’t want to go back to work? Link to comment Share on other sites More sharing options...
DooDiligence Posted April 19, 2020 Share Posted April 19, 2020 A lot of money in the lower income bracket are going to make more money for doing nothing than they made before working. https://www.masslegalhelp.org/covid-19-unemployment UI benefits + $600/week extra and extra $2400/ month. UI benefits are roughly 1/2 the prior salary, up to a certain limit. So, unless you made more than roughly $4800/ month before, you might be better of not working for a couple of month. Unless, I read these these provisions wrong. It’s quite interesting, my wife works only 1/2 time (more with overtime typically) and may actually be better of not working - as a nurse? Maybe America doesn’t want to go back to work? After all the marvelous examples our leaders have provided, we finally tip over into officially being the entitled society. Link to comment Share on other sites More sharing options...
DTEJD1997 Posted April 19, 2020 Share Posted April 19, 2020 A lot of money in the lower income bracket are going to make more money for doing nothing than they made before working. https://www.masslegalhelp.org/covid-19-unemployment UI benefits + $600/week extra and extra $2400/ month. UI benefits are roughly 1/2 the prior salary, up to a certain limit. So, unless you made more than roughly $4800/ month before, you might be better of not working for a couple of month. Unless, I read these these provisions wrong. It’s quite interesting, my wife works only 1/2 time (more with overtime typically) and may actually be better of not working - as a nurse? Maybe America doesn’t want to go back to work? I have a family member who is a nurses assistant. She will be collecting Federal & State unemployment. Her take home will be MORE with unemployment than when she was working. She will have the added benefit of not being exposed to the virus and not having to commute and helping her family. Oh yeah, she also won't have to break her back working! How will this play out for so many small business owners? Who will want to stock shelves for $12/hour at the grocery store? Who will want to work the Fry-0-Lator for $10/hour? Who will want to do basic legal work for $22/hour? People will be able to stay at home and make more, not commute, not work. If the government wanted people to get some security AND work, then simply give out a larger check to everybody who paid taxes. Thus, there is no incentive NOT to stay out of the workforce. How many other detrimental second and third order effects will there be? Link to comment Share on other sites More sharing options...
SHDL Posted April 19, 2020 Share Posted April 19, 2020 How the pandemic could influence income inequality: https://www.wsj.com/articles/how-the-coronavirus-might-reduce-income-inequality-11587304801 Link to comment Share on other sites More sharing options...
Spekulatius Posted April 19, 2020 Author Share Posted April 19, 2020 How the pandemic could influence income inequality: https://www.wsj.com/articles/how-the-coronavirus-might-reduce-income-inequality-11587304801 Past pandemics were different because they killed a lot of productive people and caused labor shortages that forced higher wages for the peasants at that time. The current epidemic really preferentially kills older people and in any case, morbidity is too low to cause a significant impact on available labor in they sense. However when you include secondary impacts like the above welfare programs and possible increased in sourcing from overseas supply chains, the next effect could be quite similar. Note that minimum wages have been rising and it seems like many companies seem to have trouble filling position that benefit from the epidemic (Amazon, grocery chains). I can well see this causing wage increases and possibly also overall inflation. As for the increase unemployment benefits they last until 7/25, but I see no chance in hell they they don’t get extended until after the election in November. Weaning ourself off from this might be quite difficult. Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted April 19, 2020 Share Posted April 19, 2020 A lot of money in the lower income bracket are going to make more money for doing nothing than they made before working. https://www.masslegalhelp.org/covid-19-unemployment UI benefits + $600/week extra and extra $2400/ month. UI benefits are roughly 1/2 the prior salary, up to a certain limit. So, unless you made more than roughly $4800/ month before, you might be better of not working for a couple of month. Unless, I read these these provisions wrong. It’s quite interesting, my wife works only 1/2 time (more with overtime typically) and may actually be better of not working - as a nurse? Maybe America doesn’t want to go back to work? This is also a concern of mine, but isn't the solution to get rid of the temporary increases? Like keep the exceptional increases in UI for while the economy is closed and in a state of emergency, but then eliminate the additional benefits when the state of emergency is over? Then you're back to making 1/2 of what you were and have incentive to get back to work - particularly when it is no longer acceptable to be skipping mortgage/rent payments. Unoubtedly there will be people who take advantage of this and that incentives are powerful things. But remove the incentives and I think you'll find most people WANT to be productive and work. Just like MOST people are still paying their mortgages at the moment despite having a govt approved forebearance open to them with zero consequences. Link to comment Share on other sites More sharing options...
DTEJD1997 Posted April 19, 2020 Share Posted April 19, 2020 A lot of money in the lower income bracket are going to make more money for doing nothing than they made before working. https://www.masslegalhelp.org/covid-19-unemployment UI benefits + $600/week extra and extra $2400/ month. UI benefits are roughly 1/2 the prior salary, up to a certain limit. So, unless you made more than roughly $4800/ month before, you might be better of not working for a couple of month. Unless, I read these these provisions wrong. It’s quite interesting, my wife works only 1/2 time (more with overtime typically) and may actually be better of not working - as a nurse? Maybe America doesn’t want to go back to work? This is also a concern of mine, but isn't the solution to get rid of the temporary increases? Like keep the exceptional increases in UI for while the economy is closed and in a state of emergency, but then eliminate the additional benefits when the state of emergency is over? Then you're back to making 1/2 of what you were and have incentive to get back to work - particularly when it is no longer acceptable to be skipping mortgage/rent payments. Unoubtedly there will be people who take advantage of this and that incentives are powerful things. But remove the incentives and I think you'll find most people WANT to be productive and work. Just like MOST people are still paying their mortgages at the moment despite having a govt approved forebearance open to them with zero consequences. That very well may happen...but I can also envision a large number of people complaining QUITE loudly that they are having trouble finding a job (that they want), that unemployment is high, they have problems, so and and so on....AND THAT GOVERNMENT NEEDS TO HELP THEM. So the "temporary" benefits continue on. I don't think they will go forever, but what politician wants to say "no"? Link to comment Share on other sites More sharing options...
SharperDingaan Posted April 19, 2020 Share Posted April 19, 2020 Or maybe ... employers just have to pay up, if they want to exploit their labour. That labour knows its worth, and we've been calling them essential workers for quite some time now ... if 'we' have to pay more more for our burger, bagger, wait staff, so be it. Bottom line is that many smaLL businesses are not viable if there is a wage increase. Post Covd-19 they either don't reopen, or collapse. Entirely the business owners choice. But the market decides whether your product/service is worth the extra cost. Terrifying prospect to many. SD Link to comment Share on other sites More sharing options...
Gregmal Posted April 19, 2020 Share Posted April 19, 2020 Or maybe ... employers just have to pay up, if they want to exploit their labour. That labour knows its worth, and we've been calling them essential workers for quite some time now ... if 'we' have to pay more more for our burger, bagger, wait staff, so be it. Bottom line is that many smaLL businesses are not viable if there is a wage increase. Post Covd-19 they either don't reopen, or collapse. Entirely the business owners choice. But the market decides whether your product/service is worth the extra cost. Terrifying prospect to many. SD I'd much rather pay more for items I choose to buy(indirect tax) because the laws of supply and demand dictate it, than have a greasy handed government raise my taxes so they can dole out that cash to the places and people whom they promised things in exchange for votes. Link to comment Share on other sites More sharing options...
Spekulatius Posted April 19, 2020 Author Share Posted April 19, 2020 Or maybe ... employers just have to pay up, if they want to exploit their labour. That labour knows its worth, and we've been calling them essential workers for quite some time now ... if 'we' have to pay more more for our burger, bagger, wait staff, so be it. Bottom line is that many smaLL businesses are not viable if there is a wage increase. Post Covd-19 they either don't reopen, or collapse. Entirely the business owners choice. But the market decides whether your product/service is worth the extra cost. Terrifying prospect to many. SD Yes, it could well happen. Note that minimum wages have been rising at a pretty good clip before this thing hit. Then a bunch of companies have created their own minus wage floor (Amazon, the banks and many others) above the federal limit. Typically a recession put a lid on wage increased, especially on the lower end, but with all the welfare programs and and unwillingness to take a chance in many occupations to catch a nasty virus, that may well not happen this time around. Likely losers will be small business (service) and agriculture. Higher inflation is also a likely outcome, but may not be they bad it is happens via higher living wages. Some folks I know at high tech companies are very very bullish on automation. Link to comment Share on other sites More sharing options...
SharperDingaan Posted April 20, 2020 Share Posted April 20, 2020 Or maybe ... employers just have to pay up, if they want to exploit their labour. That labour knows its worth, and we've been calling them essential workers for quite some time now ... if 'we' have to pay more more for our burger, bagger, wait staff, so be it. Bottom line is that many smaLL businesses are not viable if there is a wage increase. Post Covd-19 they either don't reopen, or collapse. Entirely the business owners choice. But the market decides whether your product/service is worth the extra cost. Terrifying prospect to many. SD Yes, it could well happen. Note that minimum wages have been rising at a pretty good clip before this thing hit. Then a bunch of companies have created their own minus wage floor (Amazon, the banks and many others) above the federal limit. Typically a recession put a lid on wage increased, especially on the lower end, but with all the welfare programs and and unwillingness to take a chance in many occupations to catch a nasty virus, that may well not happen this time around. Likely losers will be small business (service) and agriculture. Higher inflation is also a likely outcome, but may not be they bad it is happens via higher living wages. Some folks I know at high tech companies are very very bullish on automation. Just to add to this ... A great many small business owners are in the service business, primarily providing food & beverage to the rest of us. If the owner can't get labour, they/family have to do the work themselves, which is only sustainable if they cannot get work elsewhere. We have had the technology to automate for quite some time. Whether we're 'allowed' to, is being overlooked. You can't build atomic bombs, and claim you aren't responsible for the radiation caused .... and you cant automate, and claim you aren't responsible for the unemployment caused. Throw a lot of people out of work, and you aren't going to be allowed to automate. We see automation, we think manufacturing/mining/etc. where the jobs displaced were often toxic (physical/mental) &/or people routinely lost their lives/limbs. And those displaced, could get a job in the service industries of their time. Disruptive, but a societal clear net win. Very different story automating services. Where do the displaced go? and when that displacement is in the 10's of millions? What happens with the millions displaced in an India/China, who need the work in order to eat? History tells us that it doesn't go well. Disruptive, and a global clear net loss. Takeaways. Limited automation until the law, CSR, and privacy issues are adequately addressed. SD Link to comment Share on other sites More sharing options...
DooDiligence Posted April 20, 2020 Share Posted April 20, 2020 "Could a more automated workforce have alleviated the economic damage COVID-19 has caused? The International Federation of Robotics (IFR) reported the cost of robots has decreased and continues to decrease enabling wide adoption. South Korea has seven robots per 100 workers and every third robot installed is in China. A 2019 report by Oxford Economics predicted 12.5 million manufacturing jobs will be automated in China by 2030. In the aftermath of the pandemic, it could be many more." www.forbes.com/sites/shahinfarshchi/2020/04/10/expect-more-jobs-and-more-automation-in-the-post-covid-19-economy Link to comment Share on other sites More sharing options...
Spekulatius Posted April 25, 2020 Author Share Posted April 25, 2020 Brazil is going to be interesting to watch. These countries can’t borrow for zero interest like the EU and the US can do. Also, the president running the country is a clown. https://www.cnbc.com/2020/04/25/brazil-becoming-coronavirus-hot-spot-as-testing-falters.html Link to comment Share on other sites More sharing options...
Cigarbutt Posted April 25, 2020 Share Posted April 25, 2020 Brazil is going to be interesting to watch. These countries can’t borrow for zero interest like the EU and the US can do. Also, the president running the country is a clown. https://www.cnbc.com/2020/04/25/brazil-becoming-coronavirus-hot-spot-as-testing-falters.html Mr. Ray Dalio spends some time on this in a recently released piece (how emerging economy countries may have a hard time for a while, in a way similar to the 1980s episode which sort of ended with the Brady bonds): https://www.linkedin.com/pulse/money-credit-debt-ray-dalio/?published=t There is some yadayada so here's the key quote: "At the same time, dollar-denominated debt owed by non-Americans (i.e., those in emerging markets, European countries, and China) is about $20 trillion (which is about 50% higher than what it was in 2008), with a bit less than half of that total being short-term. These dollar debtors will have to come up with dollars to service these debts and they will have to come up with more dollars to buy goods and services in world markets. So, the US, by having the US dollar as the world’s reserve currency and having the world’s bank that produces that currency, and by having the power to put these needed dollars in the hands of Americans, can help Americans more effectively than other countries’ governments can help their own citizens. At the same time the US risks losing this privileged position by creating too much money and debt." If Brazil debt position is of any interest: https://commodity.com/debt-clock/brazil/ Some would say that countries were all equally surprised by recent developments but, in terms of vulnerability, some are more equal than others. Link to comment Share on other sites More sharing options...
SharperDingaan Posted April 25, 2020 Share Posted April 25, 2020 Brazil is going to be interesting to watch. These countries can’t borrow for zero interest like the EU and the US can do. Also, the president running the country is a clown. https://www.cnbc.com/2020/04/25/brazil-becoming-coronavirus-hot-spot-as-testing-falters.html Emerging markets have different 'norms'. A great many more people will die than would be the case in a 1st world country, and the local currency will devalue to take up the loss; when life normalizes, the country enjoys a tourism boom. Large numbers of deaths to disease is much more routine, and part of every-day life; it is also harder to topple a regime, as opponents typically suffer 'accidents', often terminal. Example: Most in NA would expect Covid-19 to be 'over' by Jan-2021. For those willing to travel, flights and accommodation, on sale at maybe 20-30% off; the currency of a 3rd world country, devalued by 25-50% versus current levels. Net of sales and FX devaluation, a one-week Feb-2021 trip to the Rio De Janeiro Carnival, may well cost less than a one-week trip to the Caribbean. A one-month Feb-2021 safari in South-Africa, may well cost less than a 10-day trip to Europe. Point? That once-in-a-lifetime trip, now becomes affordable - and the smarter folks capitalize on it. It just WILL NOT BE AMERICANS. 80%+ of Americans, don't travel outside of the US, Canada, or Mexico - and don't hold a passport. Great for the rest of us! SD Link to comment Share on other sites More sharing options...
samwise Posted April 29, 2020 Share Posted April 29, 2020 Is the crises over? Is today the day after tomorrow? Market is flat from a year ago and about 10% down YTD. Could be discounting one lost year in the next 10, or 2 in the next 20. That sort of makes sense, as long as the company survives. But such a small YTD loss in a 100 year pandemic does seem odd unless we have a V shape recovery. So how do you position yourself if you can't time the market, but want to take advantage if it falls? I don't see any cheap way. There are still some cheap parts of the market.. but that cheapness is fading fast, except where the company's survival is uncertain. Link to comment Share on other sites More sharing options...
Spekulatius Posted May 1, 2020 Author Share Posted May 1, 2020 The day after tomorrow may take a while : https://www.cidrap.umn.edu/sites/default/files/public/downloads/cidrap-covid19-viewpoint-part1.pdf Link to comment Share on other sites More sharing options...
Cigarbutt Posted May 1, 2020 Share Posted May 1, 2020 ^Complementary info: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3291411/ https://www.nejm.org/doi/pdf/10.1056/NEJMp2005630 The CV does "behave" like the flu which is relatively a good thing, short term, but a relatively (potentially) bad thing, long term. A lot of human ingenuity has been concentrated on vaccines and RNA-technology-related vaccines are most promising (many positive aspects including rapidity of the initial phases and building on previous relevant cancer research) but this is difficult to discount in an economic level. The Markets were priced for perfection and are possibly now priced for delusion but who cares about tomorrow? Link to comment Share on other sites More sharing options...
Jurgis Posted May 1, 2020 Share Posted May 1, 2020 The Markets were priced for perfection and are possibly now priced for delusion but who cares about tomorrow? YOLO, right? Link to comment Share on other sites More sharing options...
Spekulatius Posted May 10, 2020 Author Share Posted May 10, 2020 Well, it’s early days yet, but this gives us and idea what sort of real estate is impaired: https://www.reit.com/news/blog/market-commentary/nareit-member-survey-results-covid-19-and-april-rent-collections Link to comment Share on other sites More sharing options...
Spekulatius Posted May 17, 2020 Author Share Posted May 17, 2020 Interesting perspective on cities and I think what this author postulates makes sense: https://finance.yahoo.com/news/coronavirus-will-not-harm-urbanization-cities-have-a-bright-future-professor-123312505.html Link to comment Share on other sites More sharing options...
Spekulatius Posted May 21, 2020 Author Share Posted May 21, 2020 McKinsey consumer survey in Europe. It seems a lot of people especially in harder hit countries (Italy, Spain) are gloomy and intend to spent less going forward: https://www.mckinsey.de/~/media/McKinsey/Locations/Europe%20and%20Middle%20East/Deutschland/News/Presse/2020/2020-04-08%20Consumer%20Sentiment%20Survey/200408_Consumer_Sentiment_Survey.ashx Interesting is the much lower spending intend on discretionary items (jewelers, furniture, Alcohol (!) etc). Link to comment Share on other sites More sharing options...
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