Has work from home fueled this stock market rally?

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tvubpwcisla
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Has work from home fueled this stock market rally?

Post by tvubpwcisla »

I am curious if all the working from home may have fueled this stock market rally. I see a lot of people at work talk about buying this stock and that stock and I am not sure they have any clue what they are doing. Being at home, there is time to multi-task and get into the markets whereas before many folks may not have wanted to do that or even thought about it. When there is a pull-back of 10 - 20%, I wonder how it will be handled?
Stay invested my friends.
atdharris
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Re: Has work from home fueled this stock market rally?

Post by atdharris »

People had a lot of disposable income, whether it be from the stimulus or from all the money saved by not traveling/going out. That surely contributed to a good amount of new money going into the market.
Impatience
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Re: Has work from home fueled this stock market rally?

Post by Impatience »

I think it hastened something that would’ve happened eventually, pandemic or not. The fuel was effortless zero commission trading particularly on phones, combined with social media penetration. Covid was simply the spark that lit it. As crazy, weird, and sometimes stupid as it is right now, ultimately it will have a net positive effect of more people investing more money into more of the market. Too few families are invested especially at the lower ends of the ladder. Hoping that starts to change for good.
Trader Joe
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Re: Has work from home fueled this stock market rally?

Post by Trader Joe »

"Has work from home fueled this stock market rally?"

No, not at all.
corp_sharecropper
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Re: Has work from home fueled this stock market rally?

Post by corp_sharecropper »

No one can possibly know and you shouldn't trust anyone that claims to be able to answer/explain your question.
Nathan Drake
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Re: Has work from home fueled this stock market rally?

Post by Nathan Drake »

Impatience wrote: Tue Jun 15, 2021 5:46 pm I think it hastened something that would’ve happened eventually, pandemic or not. The fuel was effortless zero commission trading particularly on phones, combined with social media penetration. Covid was simply the spark that lit it. As crazy, weird, and sometimes stupid as it is right now, ultimately it will have a net positive effect of more people investing more money into more of the market. Too few families are invested especially at the lower ends of the ladder. Hoping that starts to change for good.
I fear that the wrong lessons are being taught right now and will inevitably lead to many swearing off investing for good after bad outcomes inevitably materialize
mikejuss
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Re: Has work from home fueled this stock market rally?

Post by mikejuss »

Hasn't the Fed pumping money into the economy fueled the stock-market rally?
hi_there
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Re: Has work from home fueled this stock market rally?

Post by hi_there »

There is a good chance that working from home contributed to meme stock volatility, but I think it's other factors that have generally supported the strong stock market.
phantom0308
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Re: Has work from home fueled this stock market rally?

Post by phantom0308 »

mikejuss wrote: Tue Jun 15, 2021 10:35 pm Hasn't the Fed pumping money into the economy fueled the stock-market rally?
They’ve been pumping money into the market since 2008.
cbeck
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Re: Has work from home fueled this stock market rally?

Post by cbeck »

What happened was Fed Chairman Jay Powell had our back by unilaterally extending the Fed's dual mandate to control unemployment and inflation to include the stock market.

Before the markets closed on March 11, Powell made a breathtaking announcement. The Fed was willing to print half a trillion dollars the following day, to provide short-term loans for distressed borrowers on Wall Street. The day after that, the Fed would offer another $500 billion in the short-term loans (called repo loans) market. A trillion dollars, offered over two days, was the central-bank equivalent of a “shock and awe” campaign. There was every reason to believe this would work. The Fed’s superpower rests on the simple fact that it is the only institution on earth that can create U.S. dollars out of thin air (that thing we call a “dollar” is, in fact, a Federal Reserve note). But on March 12, the Fed was outmatched by the coronavirus.

https://news.yahoo.com/jay-powell-coron ... 53596.html

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bottlecap
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Re: Has work from home fueled this stock market rally?

Post by bottlecap »

tvubpwcisla wrote: Tue Jun 15, 2021 5:20 pm I am curious if all the working from home may have fueled this stock market rally.
I don’t think there is any logic to this. People bought investments when they went to work and they likely continued doing so when they worked from home. Unless you’re a compulsive gambler, not having anyone looking over your shoulder is not going to suddenly give you the uncontrollable urge to trade.

JT
mikejuss
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Re: Has work from home fueled this stock market rally?

Post by mikejuss »

phantom0308 wrote: Tue Jun 15, 2021 11:49 pm
mikejuss wrote: Tue Jun 15, 2021 10:35 pm Hasn't the Fed pumping money into the economy fueled the stock-market rally?
They’ve been pumping money into the market since 2008.
That's exactly my point.
hnd
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Re: Has work from home fueled this stock market rally?

Post by hnd »

I believe the retail investor has very little ability to move markets this way or that. I believe even the GME stuff is Hedge vs Hedge. WSB is just space rock on the back of a meteor thinking to itself "wow i'm fast"

That said, you had millions of people unable to really do anything. they were stuck at home with no sports, or anything to really occupy their time except home projects and....the stock market.
curious_georgey
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Re: Has work from home fueled this stock market rally?

Post by curious_georgey »

Nathan Drake wrote: Tue Jun 15, 2021 10:31 pm
Impatience wrote: Tue Jun 15, 2021 5:46 pm I think it hastened something that would’ve happened eventually, pandemic or not. The fuel was effortless zero commission trading particularly on phones, combined with social media penetration. Covid was simply the spark that lit it. As crazy, weird, and sometimes stupid as it is right now, ultimately it will have a net positive effect of more people investing more money into more of the market. Too few families are invested especially at the lower ends of the ladder. Hoping that starts to change for good.
I fear that the wrong lessons are being taught right now and will inevitably lead to many swearing off investing for good after bad outcomes inevitably materialize
As a kid you only need to learn once that you don't touch a hot stove. I blew myself up in my early twenties thinking I could beat the market by watching CNBC and it turned out to be the best thing /learning experience that ever happened to me.
mikejuss
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Re: Has work from home fueled this stock market rally?

Post by mikejuss »

curious_georgey wrote: Wed Jun 16, 2021 8:26 amI blew myself up in my early twenties thinking I could beat the market by watching CNBC and it turned out to be the best thing /learning experience that ever happened to me.
Welcome to the club, George!
sureshoe
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Re: Has work from home fueled this stock market rally?

Post by sureshoe »

The definitive answers on here really surprise me.

The long-term average savings rate is around 9%. Since the pandemic, it has gone up to well over 30%. Surely that has had some impact. People are not paying as much for commuting, day care, etc. People are paying down debt. This certainly has some impact. Does it account wholly for the rally? Nah, no one thing ever does.

There has also been gobs and gobs of of stimulus put into the economy. (tiptoeing around policy) In 2009, several economists feel we didn't do enough to keep the economy rolling. Compare 2020 to 2009, there is absolutely no comparison. You simply can't inject 4+ trillion dollars into the economy and not have SOME impact.

We still have lots of corporate tax cuts, etc. that are in place. Unemployment is falling through the floor. "Inflation" might be coming, but there is a potential for real wages to actually catch up some - while a labor shortage isn't "good", places that were paying $12-$14/hour are now posting $18+ rates because they literally can't open their doors.

I personally don't think people sitting around bored is the reason. PE ratios are high right now, but I think there are substantial fundamentals driving this with people expecting a fire-hot economy over the next 1-2 years. Like any time, such as the 90s, people are going to dabble in trading as they have extra money.
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Re: Has work from home fueled this stock market rally?

Post by Cycle »

Who is not paying for daycare? I've heard of one family that has kept their kid at home. I couldn't get anything done if I had a 2.5yo and 9mo old to watch at home.

I took the bus to work before, so not much commuting money saved. My savings rate has only gone down as we now have a 2nd kid.
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phantom0308
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Re: Has work from home fueled this stock market rally?

Post by phantom0308 »

mikejuss wrote: Wed Jun 16, 2021 8:20 am
phantom0308 wrote: Tue Jun 15, 2021 11:49 pm
mikejuss wrote: Tue Jun 15, 2021 10:35 pm Hasn't the Fed pumping money into the economy fueled the stock-market rally?
They’ve been pumping money into the market since 2008.
That's exactly my point.
Ok, I assumed that this thread is about a more recent stock market rally that we've since last March, so I didn't think it'd be a good explanation for this one vs the continued rise since 2009 (with a blip in 2018).
sureshoe
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Re: Has work from home fueled this stock market rally?

Post by sureshoe »

Cycle wrote: Wed Jun 16, 2021 9:10 am Who is not paying for daycare? I've heard of one family that has kept their kid at home. I couldn't get anything done if I had a 2.5yo and 9mo old to watch at home.

I took the bus to work before, so not much commuting money saved. My savings rate has only gone down as we now have a 2nd kid.
Lots of people.

My kids were 6, 8, and 10 this school year. When I was working in the office, we had to drop them off at latchkey at 7:30am and pick them up at 5:30pm. That was $150/week, $600/month-ish. After tax money, so that was almost like a $10k/year raise by letting them stay at home and get on the bus at our place around 8:30/9, get off around 3:30/4. Then, they just stay busy until I wrap up work.
stoptothink
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Re: Has work from home fueled this stock market rally?

Post by stoptothink »

sureshoe wrote: Wed Jun 16, 2021 12:31 pm
Cycle wrote: Wed Jun 16, 2021 9:10 am Who is not paying for daycare? I've heard of one family that has kept their kid at home. I couldn't get anything done if I had a 2.5yo and 9mo old to watch at home.

I took the bus to work before, so not much commuting money saved. My savings rate has only gone down as we now have a 2nd kid.
Lots of people.

My kids were 6, 8, and 10 this school year. When I was working in the office, we had to drop them off at latchkey at 7:30am and pick them up at 5:30pm. That was $150/week, $600/month-ish. After tax money, so that was almost like a $10k/year raise by letting them stay at home and get on the bus at our place around 8:30/9, get off around 3:30/4. Then, they just stay busy until I wrap up work.
The daycare that my kids were previously at went out of business this past year because everybody pulled their kids out. My neighbor and wife's best friend are two of the families who pulled their kids out. I have WFH 1.5 days a week since my son was born so I could spend more time with our kids. My kids (now 9 and 6) are out of school for the summer while wife and I are WFH, there is zero chance we were putting them in childcare. Never been an issue for us meeting our work responsibilities while the kids are at home.
stan1
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Re: Has work from home fueled this stock market rally?

Post by stan1 »

Counterpoint: a relatively low paid co-worker had four kids at home under age of 15, including an infant. Even with husband at home, also relatively low paid, she was not able to keep up with tasking. Hired someone for a few hours to fix lunch for kids. Still got laid off. Felt bad, but didn't have a choice. So those who can afford an in house nanny or who are superheros should consider yourselves lucky, special, or whatever term you want to use that separates you from a lot of ordinary people.
getthatmarshmallow
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Re: Has work from home fueled this stock market rally?

Post by getthatmarshmallow »

Plenty of daycares closed, and at least locally enrollment dropped a lot. My kid's preschool normally has a waiting list but this year they couldn't fill the slots. CARES Act funding I imagine filled the gap.

We didn't have childcare last summer but we already worked from home and our kids are pretty good at self entertaining so it was a manageable state of affairs. SOs boss was amazing and let him work 6am - noon so we could wrangle the kids in shifts during the first part of the pandemic. It is much easier with the kids out of the house, though, and like many academics I'm approaching solar-flare levels of burnout, so we have a part-time nannyshare going again. Zero regrets.
sureshoe
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Re: Has work from home fueled this stock market rally?

Post by sureshoe »

stan1 wrote: Wed Jun 16, 2021 5:15 pm Counterpoint: a relatively low paid co-worker had four kids at home under age of 15, including an infant. Even with husband at home, also relatively low paid, she was not able to keep up with tasking. Hired someone for a few hours to fix lunch for kids. Still got laid off. Felt bad, but didn't have a choice. So those who can afford an in house nanny or who are superheros should consider yourselves lucky, special, or whatever term you want to use that separates you from a lot of ordinary people.
I don't think this is about "superhero". The pandemic has definitely caused a greater separation between "haves" and "have nots". In my case, specifically, I was able to drop over 90 minutes of daily travel. I was able to save $150/week by simply having kids hang out around the house for an hour or two. Not "superhero", just fortunate.

I know a lot of people who have their kids at home over the summer in the 5-12 age range, I am not doing that right now, I am sending all 3 to camp where they get physical activity/stimulation/etc - which is $450-ish a week for this summer. Sending the newborn to a private sitter (so I will be funding daycare at some point for the new one). For us, I'm lucky to have the resources to do this - we know people who have kids sitting in front of the ipad all day.

So don't read my posts as "I'm awesome". It's more that I'm fortunate to be in a position to be able to do that. At the same time, I think people are sometimes trapped by their own decisions and false assumptions. A person doesn't "have" to work a certain job. They are capable of making changes. If I was making $50k a year, commuting, and paying daycare, my focus would be getting out of that mess. Easier said than done, and I truly empathize with people who feel trapped.
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Re: Has work from home fueled this stock market rally?

Post by Sandtrap »

tvubpwcisla wrote: Tue Jun 15, 2021 5:20 pm I am curious if all the working from home may have fueled this stock market rally. I see a lot of people at work talk about buying this stock and that stock and I am not sure they have any clue what they are doing. Being at home, there is time to multi-task and get into the markets whereas before many folks may not have wanted to do that or even thought about it. When there is a pull-back of 10 - 20%, I wonder how it will be handled?
There are a lot of things each year, from this to that, that are catalysts for subtle and dynamic change. Some obvious. Some insidious and pervasive.
Working from home is just one of many. a tiny shift of the needle on a global financial meter reading. Just a flutter.
What happens at a micro vs macro level.

Actionably: A solid grounded personal financial strategy with assets in place and growing, anchors one through all of this and allows one to ignore the noise, de stress, and stay the course.

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stoptothink
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Re: Has work from home fueled this stock market rally?

Post by stoptothink »

sureshoe wrote: Wed Jun 16, 2021 7:28 pm
stan1 wrote: Wed Jun 16, 2021 5:15 pm Counterpoint: a relatively low paid co-worker had four kids at home under age of 15, including an infant. Even with husband at home, also relatively low paid, she was not able to keep up with tasking. Hired someone for a few hours to fix lunch for kids. Still got laid off. Felt bad, but didn't have a choice. So those who can afford an in house nanny or who are superheros should consider yourselves lucky, special, or whatever term you want to use that separates you from a lot of ordinary people.
I don't think this is about "superhero". The pandemic has definitely caused a greater separation between "haves" and "have nots". In my case, specifically, I was able to drop over 90 minutes of daily travel. I was able to save $150/week by simply having kids hang out around the house for an hour or two. Not "superhero", just fortunate.

I know a lot of people who have their kids at home over the summer in the 5-12 age range, I am not doing that right now, I am sending all 3 to camp where they get physical activity/stimulation/etc - which is $450-ish a week for this summer. Sending the newborn to a private sitter (so I will be funding daycare at some point for the new one). For us, I'm lucky to have the resources to do this - we know people who have kids sitting in front of the ipad all day.

So don't read my posts as "I'm awesome". It's more that I'm fortunate to be in a position to be able to do that. At the same time, I think people are sometimes trapped by their own decisions and false assumptions. A person doesn't "have" to work a certain job. They are capable of making changes. If I was making $50k a year, commuting, and paying daycare, my focus would be getting out of that mess. Easier said than done, and I truly empathize with people who feel trapped.
Yeah, hardly consider ourselves "superheros" because we have years of proving we can maintain production while having kids at home. Sure it is challenging sometimes, but not challenging often enough or to a level which would make me even remotely consider paying $3k+/month again to have them in childcare (and we can very easily afford it). We have several neighbors who are doing the same thing now as they transitioned to WFH, many of whom have more kids than us (one of our neighbors is doing it with 7). If anything, this whole experiment has shown how little time we are actually actively working when in office (I swear my wife actually works maybe 15hrs/week and is the top producer in enterprise sales for her mid-size tech company).
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firebirdparts
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Re: Has work from home fueled this stock market rally?

Post by firebirdparts »

As Glenn Frey famously said, It's the lure of easy money, it's got a very strong appeal.

working from home has, perhaps forever, changed certain aspects of the market. I am sure that option use is at a crazy all-time high. But along with working from home you have to have some other developments:
1. Free money
2. Free trading
3. Fin-tech figures out that trading could be like a video game on your phone
4. Government is not trying to stop "pooling" using internet forums/reddit/etc.
A fool and your money are soon partners
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