Coronavirus and the market

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CoastalWinds
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Re: Coronavirus and the market

Post by CoastalWinds » Sat Mar 21, 2020 11:19 pm

SVariance1 wrote:
Sat Mar 21, 2020 4:28 pm
quantAndHold wrote:
Sat Mar 21, 2020 4:24 pm
Unemployment during the Great Depression peaked at 24.9%

During 2009, US unemployment was 9.9%.

I don't think whatever this is will last as long as the Great Depression did, but just throwing those numbers out there to compare with as we get numbers from the BLS over the next few weeks.
I think we will see peak unemployment somewhere between 9.9% and 24.9%. I do not think it will get as high as in the great depression because people can work from home. Unemployment will naturally rise due to the shutdowns and if the stock market falls more, unemployment will rise more.
Didn’t the government’s method of measuring unemployment changed between 1930 and 2009?

Also, are self-employed, independent contractors, and gig workers who can’t get work even counted in the official unemployment %?

Seasonal
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Re: Coronavirus and the market

Post by Seasonal » Sun Mar 22, 2020 5:39 am

CoastalWinds wrote:
Sat Mar 21, 2020 11:19 pm
SVariance1 wrote:
Sat Mar 21, 2020 4:28 pm
quantAndHold wrote:
Sat Mar 21, 2020 4:24 pm
Unemployment during the Great Depression peaked at 24.9%

During 2009, US unemployment was 9.9%.

I don't think whatever this is will last as long as the Great Depression did, but just throwing those numbers out there to compare with as we get numbers from the BLS over the next few weeks.
I think we will see peak unemployment somewhere between 9.9% and 24.9%. I do not think it will get as high as in the great depression because people can work from home. Unemployment will naturally rise due to the shutdowns and if the stock market falls more, unemployment will rise more.
Didn’t the government’s method of measuring unemployment changed between 1930 and 2009?

Also, are self-employed, independent contractors, and gig workers who can’t get work even counted in the official unemployment %?
Unemployment is defined by the Bureau of Labor Statistics as people who do not have a job, have actively looked for work in the past four weeks, and are currently available for work. I believe this includes all types of jobs, including self-employed, etc.

See https://www.bls.gov/cps/definitions.htm

You might be right that the definition has changed, but I can't quickly find the answer. Please provide a link.

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Re: Coronavirus and the market

Post by fsrph » Sun Mar 22, 2020 8:29 am

[Quoted post removed -- admin LadyGeek]

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Re: Coronavirus and the market

Post by LadyGeek » Sun Mar 22, 2020 8:34 am

Several off-topic posts have been removed. As a reminder, the main intent of the post must be related to the market.

General discussions are here: Bogleheads community discussion - Coronavirus
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MnD
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Re: Coronavirus and the market

Post by MnD » Sun Mar 22, 2020 11:08 am

The Italian stock market index was down 41% from recent Feb 19 peak to March 12 recent trough.
Has been trading generally up since March 12.
https://www.borsaitaliana.it/borsa/indi ... IB&lang=en
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nps
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Re: Coronavirus and the market

Post by nps » Sun Mar 22, 2020 11:26 am

MnD wrote:
Sun Mar 22, 2020 11:08 am
The Italian stock market index was down 41% from recent Feb 19 peak to March 12 recent trough.
Has been trading generally up since March 12.
https://www.borsaitaliana.it/borsa/indi ... IB&lang=en
Great illustration. Looks like up around 5.6% since March 12th. For those who think the market will continue to plunge until things start improving, consider whether the news out of Italy has gotten better or worse since March 12th.

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willthrill81
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Re: Coronavirus and the market

Post by willthrill81 » Sun Mar 22, 2020 11:33 am

MnD wrote:
Sun Mar 22, 2020 11:08 am
The Italian stock market index was down 41% from recent Feb 19 peak to March 12 recent trough.
Has been trading generally up since March 12.
https://www.borsaitaliana.it/borsa/indi ... IB&lang=en
I've noticed that as well and wonder if that might serve as a rough proxy what might happen in the U.S. However, several have pointed to the temporary banning of short-selling in the Italian market as the potential cause for the stabilization.
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ResearchMed
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Re: Coronavirus and the market

Post by ResearchMed » Sun Mar 22, 2020 11:42 am

I find it a bit peculiar that the Italian exchange downturn started just as the USA downturn began.
Didn't COVID-19 hospitalizations/deaths in Italy start earlier than ours?
Was "their market" not responding to their own situation, but to others' markets (e.g., USA?)?

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willthrill81
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Re: Coronavirus and the market

Post by willthrill81 » Sun Mar 22, 2020 11:45 am

ResearchMed wrote:
Sun Mar 22, 2020 11:42 am
I find it a bit peculiar that the Italian exchange downturn started just as the USA downturn began.
Didn't COVID-19 hospitalizations/deaths in Italy start earlier than ours?
Was "their market" not responding to their own situation, but to others' markets (e.g., USA?)?

RM
Good question. It's may be worth noting that historically, the unemployment rate in the U.S. has been a much better predictor of European market returns than the European unemployment rate, suggesting that what happens in the U.S. markets is very influential in other markets.
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DB2
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Re: Coronavirus and the market

Post by DB2 » Sun Mar 22, 2020 1:14 pm

Lockdown likely until June.

https://www.usnews.com/news/us/articles ... icial-says

I will be surprised if we don't have a depression.

MnD
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Re: Coronavirus and the market

Post by MnD » Sun Mar 22, 2020 1:45 pm

MnD wrote:
Thu Mar 19, 2020 1:31 pm
This dataset seems useful for tracking job loss/regain in the small biz restaurant, food & beverage, retail and services sector.
-39% as of yesterday. :shock:

https://docs.google.com/spreadsheets/d/ ... gmail_link#

This data set is prepared by Homebase, a free scheduling and time tracking tool used by 100,000+ local businesses and their hourly employees. Homebase's customers in the US primarily consist of restaurant, food & beverage, retail and services and are largely individual owned/operator managed businesses.
Hourly employees working among (100,000+ businesses using Homebase) now down 56% versus January.
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yoyo6713
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Re: Coronavirus and the market

Post by yoyo6713 » Sun Mar 22, 2020 1:55 pm

DB2 wrote:
Sun Mar 22, 2020 1:14 pm
Lockdown likely until June.

https://www.usnews.com/news/us/articles ... icial-says

I will be surprised if we don't have a depression.
This is not news. I think in one of the tele-conference, the administration said it will go on until July/Aug so June is actually good news.

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willthrill81
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Re: Coronavirus and the market

Post by willthrill81 » Sun Mar 22, 2020 1:58 pm

yoyo6713 wrote:
Sun Mar 22, 2020 1:52 pm
I would not be shocked if the stocks rebounds from here.
On the basis of what information? Everything I'm seeing is indicating that economics are worsening, certainly not improving.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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ResearchMed
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Re: Coronavirus and the market

Post by ResearchMed » Sun Mar 22, 2020 2:03 pm

DB2 wrote:
Sun Mar 22, 2020 1:14 pm
Lockdown likely until June.

https://www.usnews.com/news/us/articles ... icial-says

I will be surprised if we don't have a depression.
IF there is a depression, what is the "best" asset to have? Cash?
(And somewhere *safe*...!)

RM
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yoyo6713
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Re: Coronavirus and the market

Post by yoyo6713 » Sun Mar 22, 2020 2:26 pm

willthrill81 wrote:
Sun Mar 22, 2020 1:58 pm
yoyo6713 wrote:
Sun Mar 22, 2020 1:52 pm
I would not be shocked if the stocks rebounds from here.
On the basis of what information? Everything I'm seeing is indicating that economics are worsening, certainly not improving.
All 4 points in the post I was replying to were not unexpected to me.

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nps
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Re: Coronavirus and the market

Post by nps » Sun Mar 22, 2020 2:38 pm

willthrill81 wrote:
Sun Mar 22, 2020 1:58 pm
yoyo6713 wrote:
Sun Mar 22, 2020 1:52 pm
I would not be shocked if the stocks rebounds from here.
On the basis of what information? Everything I'm seeing is indicating that economics are worsening, certainly not improving.
If you look at the poster's entire comment it's clear that they are not predicting the direction of the stock market. Unlike many others on this forum...

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oneleaf
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Re: Coronavirus and the market

Post by oneleaf » Sun Mar 22, 2020 2:44 pm

DB2 wrote:
Sun Mar 22, 2020 1:14 pm
Lockdown likely until June.

https://www.usnews.com/news/us/articles ... icial-says

I will be surprised if we don't have a depression.
This really shouldn't be a surprise. Lockdowns was already implemented until May, and we all knew we would have to re-assess. That said, I have no idea how close to the bottom we are.

peskypesky
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Re: Coronavirus and the market

Post by peskypesky » Sun Mar 22, 2020 2:51 pm

'Unrecognizable': Experts warn of historic collapse in economic activity
https://finance.yahoo.com/news/coronavi ... 00768.html

Seasonal
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Re: Coronavirus and the market

Post by Seasonal » Sun Mar 22, 2020 3:24 pm

Fed's Bullard says U.S. unemployment rate may hit 30% in the second quarter
‘Everything is on the table’ for Fed to provide support
https://www.bloomberg.com/news/articles ... o-30-in-2q

Morgan Stanley: We expect the US economy to contract at a 2.4% annualized rate in 1Q, followed by a historically sharp 30% (annual rate) contraction in 2Q20.

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Re: Coronavirus and the market

Post by Corsair » Sun Mar 22, 2020 3:42 pm

Seasonal wrote:
Sun Mar 22, 2020 3:24 pm
Fed's Bullard says U.S. unemployment rate may hit 30% in the second quarter
‘Everything is on the table’ for Fed to provide support
https://www.bloomberg.com/news/articles ... o-30-in-2q

Morgan Stanley: We expect the US economy to contract at a 2.4% annualized rate in 1Q, followed by a historically sharp 30% (annual rate) contraction in 2Q20.
I still don’t understand how this won’t cause inflation in the future. Thankfully I don’t run the Fed.
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JonnyB
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Re: Coronavirus and the market

Post by JonnyB » Sun Mar 22, 2020 4:22 pm

Corsair wrote:
Sun Mar 22, 2020 3:42 pm
Seasonal wrote:
Sun Mar 22, 2020 3:24 pm
Fed's Bullard says U.S. unemployment rate may hit 30% in the second quarter
‘Everything is on the table’ for Fed to provide support
https://www.bloomberg.com/news/articles ... o-30-in-2q

Morgan Stanley: We expect the US economy to contract at a 2.4% annualized rate in 1Q, followed by a historically sharp 30% (annual rate) contraction in 2Q20.
I still don’t understand how this won’t cause inflation in the future. Thankfully I don’t run the Fed.
People have been saying this for 12 years now. At some point those people might have to give up their model of how the economy works.

Seasonal
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Re: Coronavirus and the market

Post by Seasonal » Sun Mar 22, 2020 4:33 pm

JonnyB wrote:
Sun Mar 22, 2020 4:22 pm
Corsair wrote:
Sun Mar 22, 2020 3:42 pm
Seasonal wrote:
Sun Mar 22, 2020 3:24 pm
Fed's Bullard says U.S. unemployment rate may hit 30% in the second quarter
‘Everything is on the table’ for Fed to provide support
https://www.bloomberg.com/news/articles ... o-30-in-2q

Morgan Stanley: We expect the US economy to contract at a 2.4% annualized rate in 1Q, followed by a historically sharp 30% (annual rate) contraction in 2Q20.
I still don’t understand how this won’t cause inflation in the future. Thankfully I don’t run the Fed.
People have been saying this for 12 years now. At some point those people might have to give up their model of how the economy works.
Yes. Looking at what the Fed did in 2008, and inflation since then, is instructive.

Prahasaurus
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Re: Coronavirus and the market

Post by Prahasaurus » Sun Mar 22, 2020 4:50 pm

Fed says potentially 30% unemployment, plus we're experiencing an "unprecedented" collapse in economic activity.

Someone remind me again why the market is not going to fall another 40%? Seriously, don't tell me 30% unemployment was priced in... We are going to see consumer spending fall off a cliff, and bankruptcies skyrocket.
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ImUrHuckleberry
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Re: Coronavirus and the market

Post by ImUrHuckleberry » Sun Mar 22, 2020 4:53 pm

Weekend Wall Street only down 1.5% after being down as much as 3% most of yesterday. I guess we'll see what the futures market thinks of those new reports shortly.

peskypesky
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Re: Coronavirus and the market

Post by peskypesky » Sun Mar 22, 2020 4:54 pm

Prahasaurus wrote:
Sun Mar 22, 2020 4:50 pm
Fed says potentially 30% unemployment, plus we're experiencing an "unprecedented" collapse in economic activity.

Someone remind me again why the market is not going to fall another 40%? Seriously, don't tell me 30% unemployment was priced in... We are going to see consumer spending fall off a cliff, and bankruptcies skyrocket.
underwater mortgages are coming back too


The Coronavirus-Driven U.S. Housing Market Crash Could Be Worse Than In 2008
https://www.ccn.com/coronavirus-driven- ... than-2008/

drk
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Re: Coronavirus and the market

Post by drk » Sun Mar 22, 2020 4:58 pm

Corsair wrote:
Sun Mar 22, 2020 3:42 pm
Seasonal wrote:
Sun Mar 22, 2020 3:24 pm
Fed's Bullard says U.S. unemployment rate may hit 30% in the second quarter
‘Everything is on the table’ for Fed to provide support
https://www.bloomberg.com/news/articles ... o-30-in-2q

Morgan Stanley: We expect the US economy to contract at a 2.4% annualized rate in 1Q, followed by a historically sharp 30% (annual rate) contraction in 2Q20.
I still don’t understand how this won’t cause inflation in the future. Thankfully I don’t run the Fed.
Demand shocks create deflationary pressure. If this stimulus creates inflation in spite of that, it will have (1) been successful and (2) done what the Federal Reserve has failed to do the last 12 years and the Bank of Japan the last 20 years.

columbia
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Re: Coronavirus and the market

Post by columbia » Sun Mar 22, 2020 5:02 pm

Prahasaurus wrote:
Sun Mar 22, 2020 4:50 pm
Fed says potentially 30% unemployment, plus we're experiencing an "unprecedented" collapse in economic activity.

Someone remind me again why the market is not going to fall another 40%? Seriously, don't tell me 30% unemployment was priced in... We are going to see consumer spending fall off a cliff, and bankruptcies skyrocket.
The question is whether the market was completely clueless about what the effects would be here, after seeing the measures taken in China, and the answer is a resounding “yes.”
If you leave your head in the sand for too long, you might get run over by a Jeep.

Seasonal
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Re: Coronavirus and the market

Post by Seasonal » Sun Mar 22, 2020 5:06 pm

S&P futures -4.11%

ETA: Limit down already.

peskypesky
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Re: Coronavirus and the market

Post by peskypesky » Sun Mar 22, 2020 5:21 pm

Seasonal wrote:
Sun Mar 22, 2020 5:06 pm
S&P futures -4.11%

ETA: Limit down already.
ugh

deanmoriarty
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Re: Coronavirus and the market

Post by deanmoriarty » Sun Mar 22, 2020 5:26 pm

This is just insane. I have been staying the course so far on a 70/30 portfolio but I am almost reaching the point where I can’t take it anymore.

The news is getting worse and worse by the hour, NYC is going to get massively worse before it gets better and soon all the other states will follow, and all I can hear is the parroting “the market has already priced all this in, the market expects all this already!”, and yet this is always followed by a new evening of futures dropping and a subsequent 10% daily decrease during trading hours.

The “market” has not priced in anything yet. Every day, as the US situation becomes closer and closer to Italy and China, more investors will freak out and liquidate their investments. Most people have not priced in the fact that our growing infection curve is on the exact same trajectory of the other devastated countries. They haven’t. And it’s insane, this is perhaps the only time in history where we have a clear window into the 4 weeks future in how this epidemic will develop, and the fact that the market keeps going down despite the curve progressing as expected means that the market has not priced that in.

In times like these the blind faith of this community is more akin to a religious cult than a rational investment group.

I really hope 5 years from now I’ll be reading again this post and laugh at it :(
Last edited by deanmoriarty on Sun Mar 22, 2020 5:42 pm, edited 2 times in total.

LawProf
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Re: Coronavirus and the market

Post by LawProf » Sun Mar 22, 2020 5:28 pm

Still feels to me like people are underselling the scope of what is happening in terms of the effect on the market. The news is really, really bad and not all of it is baked in. Plus, (a) more people are getting nervous about things and will thus "panic" sell and (b) more people are going to be forced to sell because they simply need the money.

glossolalia
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Re: Coronavirus and the market

Post by glossolalia » Sun Mar 22, 2020 5:31 pm

deanmoriarty wrote:
Sun Mar 22, 2020 5:26 pm
In times like these the blind faith of this community is more akin to a religious cult than a rational investment group.
The sooner you see this, the sooner you'll realize there is a whole world of investment strategy that goes way beyond blindly buying and holding.

I came to this conclusion at all-time highs. It's even more obvious now.
Last edited by glossolalia on Sun Mar 22, 2020 5:31 pm, edited 1 time in total.

Thesaints
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Re: Coronavirus and the market

Post by Thesaints » Sun Mar 22, 2020 5:31 pm

deanmoriarty wrote:
Sun Mar 22, 2020 5:26 pm
In times like these the blind faith of this community is more akin to a religious cult than a rational investment group.
It has actually always been like that. They were simply lucky to have picked a religion that most of the time is not so bad.
Now more than ever, by reading some posts, it is abundantly clear that there are many many poster who have no clue whatsoever (and they never had)

DB2
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Re: Coronavirus and the market

Post by DB2 » Sun Mar 22, 2020 5:34 pm

JonnyB wrote:
Sun Mar 22, 2020 4:22 pm

People have been saying this for 12 years now. At some point those people might have to give up their model of how the economy works.
I think the inflation went more into stock market and real estate all the while in the weakest GDP expansion in recent times. This time around, we get more that will go into consumer hands and what is happening now overall is absolutely going to dwarf the overall 2008 response. I think if the dollar holds up (and it should continue to), inflation will be fine for a while. However, over time, it will be very interesting.

Prahasaurus
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Re: Coronavirus and the market

Post by Prahasaurus » Sun Mar 22, 2020 5:42 pm

It's really, really bad. And as I've stated her a number of times, I believe much worse that what is already priced in. I think the country is still in denial. And as I've noted here many times, there are a number of events that will almost certainly happen in the coming weeks that I believe will take the market lower. I think our biggest problem, the elephant in the room, cannot even be discussed on this site, because of posting rules...

But having said all of that, I do think we'll get through this. It may take 7-10 years for the market to fully recover, but it will recover. Things are very grim now, and will get worse before getting better, but I still have hope.

The main thing is to stay healthy over the coming weeks and months. Hopefully the heat will slow the virus, and we can regroup in the summer.
Asset Allocation: 50% cash (USD), 30% VT, 20% Bitcoin

Ruger23
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Re: Coronavirus and the market

Post by Ruger23 » Sun Mar 22, 2020 5:49 pm

Prahasaurus wrote:
Sun Mar 22, 2020 5:42 pm
It's really, really bad. And as I've stated her a number of times, I believe much worse that what is already priced in. I think the country is still in denial. And as I've noted here many times, there are a number of events that will almost certainly happen in the coming weeks that I believe will take the market lower. I think our biggest problem, the elephant in the room, cannot even be discussed on this site, because of posting rules...

But having said all of that, I do think we'll get through this. It may take 7-10 years for the market to fully recover, but it will recover. Things are very grim now, and will get worse before getting better, but I still have hope.

The main thing is to stay healthy over the coming weeks and months. Hopefully the heat will slow the virus, and we can regroup in the summer.
Agreed and those rules limit an honest and full discussion

DB2
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Re: Coronavirus and the market

Post by DB2 » Sun Mar 22, 2020 5:50 pm

Think of it this way.

The largest draw-down reached was 57% in the last crisis. The solution to the problem became clear and was 'fixed' relatively fast.

What we have today is far worse and of greater magnitude to the overall economy. And then there is the health aspect. Solutions are unclear and cannot be fixed any time soon. And then there is the election in November. Way more uncertainties which is only going to cause a much larger draw-down than where we are at today in my opinion. I hope I am wrong for the sake of everyone and the country. But, this entire situation has been very clear to me since the beginning. I was reading about Coronovirus before the mainstream news was covering it. It became very obvious to me this was going to be an absolute disaster and that the U.S. government wasn't doing what it needed to do stop it.

I actually pulled out of the market when it was still positive for the year.
Last edited by DB2 on Sun Mar 22, 2020 6:01 pm, edited 3 times in total.

Thesaints
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Re: Coronavirus and the market

Post by Thesaints » Sun Mar 22, 2020 5:53 pm

Absolutely. I'm on an 8-month long rebalancing path and I'm not being prudent, but I'm really rolling the dice. Thank you guaranteed pension !

visualguy
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Re: Coronavirus and the market

Post by visualguy » Sun Mar 22, 2020 6:01 pm

DB2 wrote:
Sun Mar 22, 2020 5:50 pm
Think of it this way.

The largest draw-down reached was 57% in the last crisis. The solution to the problem became clear and was 'fixed' relatively fast.

What we have today is far worse and of greater magnitude to the overall economy. And then there is the health aspect. Solutions are unclear and cannot be fixed any time soon. And then there is the election in November. Way more uncertainties which is only going to cause a a much larger draw-down in my opinion.
Dropping 50% or a bit more from the peaks for what we're dealing with makes sense, but not sure I would expect it to be far worse than that (although it's possible). The reason I don't think we'll reach wipe-out levels is that these pandemics have always peaked and declined pretty quickly in the past. The damage is significant, but for a limited period. Not something that lasts many years. It could be different this time if this virus has properties that we've never seen before which would make it a serious long-term problem, but there's no sign of that so far thankfully.
Last edited by visualguy on Sun Mar 22, 2020 6:03 pm, edited 1 time in total.

Stormbringer
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Re: Coronavirus and the market

Post by Stormbringer » Sun Mar 22, 2020 6:03 pm

ResearchMed wrote:
Sun Mar 22, 2020 2:03 pm
IF there is a depression, what is the "best" asset to have? Cash?
(And somewhere *safe*...!)
Ammunition and canned goods are looking pretty good right now. And toilet paper.
"Compound interest is the most powerful force in the universe." - Albert Einstein

peskypesky
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Re: Coronavirus and the market

Post by peskypesky » Sun Mar 22, 2020 6:07 pm

DB2 wrote:
Sun Mar 22, 2020 5:50 pm
I actually pulled out of the market when it was still positive for the year.
Me too. I sold ALL my stocks when market was down 10-15% from the historic February highs. About $500k worth.

SO glad I did.

peskypesky
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Re: Coronavirus and the market

Post by peskypesky » Sun Mar 22, 2020 6:12 pm

visualguy wrote:
Sun Mar 22, 2020 6:01 pm
DB2 wrote:
Sun Mar 22, 2020 5:50 pm
Think of it this way.

The largest draw-down reached was 57% in the last crisis. The solution to the problem became clear and was 'fixed' relatively fast.

What we have today is far worse and of greater magnitude to the overall economy. And then there is the health aspect. Solutions are unclear and cannot be fixed any time soon. And then there is the election in November. Way more uncertainties which is only going to cause a a much larger draw-down in my opinion.
Dropping 50% or a bit more from the peaks for what we're dealing with makes sense, but not sure I would expect it to be far worse than that (although it's possible). The reason I don't think we'll reach wipe-out levels is that these pandemics have always peaked and declined pretty quickly in the past. The damage is significant, but for a limited period. Not something that lasts many years. It could be different this time if this virus has properties that we've never seen before which would make it a serious long-term problem, but there's no sign of that so far thankfully.
You're only looking at one thing. The virus. But although the virus may be the catalyst, the are other things to take into account.

1. virus
2. global economic collapse
3. oil price war
4. US Presidential elections
5. climate change

APX32
Posts: 90
Joined: Sat May 27, 2017 1:22 pm

Re: Coronavirus and the market

Post by APX32 » Sun Mar 22, 2020 6:14 pm

glossolalia wrote:
Sun Mar 22, 2020 5:31 pm
deanmoriarty wrote:
Sun Mar 22, 2020 5:26 pm
In times like these the blind faith of this community is more akin to a religious cult than a rational investment group.
The sooner you see this, the sooner you'll realize there is a whole world of investment strategy that goes way beyond blindly buying and holding.

I came to this conclusion at all-time highs. It's even more obvious now.
It’s amazing to me, it’s almost as if the phrase “stay the course” has been permanently implanted into some people’s heads and gets blindly repeated over and over, in complete contradiction to the realities confronting us.

I have no doubt that if equities and stock markets existed during Black Death, the most devastating plague in the history of humanity, there’d be Bogleheads telling us to stay the course.
8% SPY | 5% GLD | 87% Cash

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ReformedSpender
Posts: 525
Joined: Fri Mar 16, 2018 1:24 pm
Location: Stone's Throw from Vanguard

Re: Coronavirus and the market

Post by ReformedSpender » Sun Mar 22, 2020 6:16 pm

If I can be honest, it’s unbelievable to watch more and more individuals here losing their confidence each passing day. Individuals whom are more knowledgeable about finances than most people as these lessons are ingrained in Bogleheads.

Takeaway; being a Boglehead is not a one way street. You stay the course through the bad just as you did through the good.
Market history shows that when there's economic blue sky, future returns are low, and when the economy is on the skids, future returns are high. The best fishing is done in the most stormy waters.

sambb
Posts: 2887
Joined: Sun Mar 10, 2013 3:31 pm

Re: Coronavirus and the market

Post by sambb » Sun Mar 22, 2020 6:36 pm

APX32 wrote:
Sun Mar 22, 2020 6:14 pm
glossolalia wrote:
Sun Mar 22, 2020 5:31 pm
deanmoriarty wrote:
Sun Mar 22, 2020 5:26 pm
In times like these the blind faith of this community is more akin to a religious cult than a rational investment group.
The sooner you see this, the sooner you'll realize there is a whole world of investment strategy that goes way beyond blindly buying and holding.

I came to this conclusion at all-time highs. It's even more obvious now.
It’s amazing to me, it’s almost as if the phrase “stay the course” has been permanently implanted into some people’s heads and gets blindly repeated over and over, in complete contradiction to the realities confronting us.

I have no doubt that if equities and stock markets existed during Black Death, the most devastating plague in the history of humanity, there’d be Bogleheads telling us to stay the course.


Well said. The virus added RISK to any asset allocaiton, that was a black swan risk. Unlike other black swans, could see this coming, but many BH criticized those pointing out the black swan. Now, probably too late to get out? may be headed to dow 15000. lots of those who rebalanced to a different allocation due to a change in perception of risk and discomfort, are going to be fine. It is important to always know one's Risk Tolerance, and never take too much or too little risk as bogleheads state.

For those that risk didnt bother them, then by all means, stay the course. It all comes down to risk comfort.

veggivet
Posts: 809
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Location: New England

Re: Coronavirus and the market

Post by veggivet » Sun Mar 22, 2020 6:45 pm

Stormbringer wrote:
Sun Mar 22, 2020 6:03 pm
ResearchMed wrote:
Sun Mar 22, 2020 2:03 pm
IF there is a depression, what is the "best" asset to have? Cash?
(And somewhere *safe*...!)
Ammunition and canned goods are looking pretty good right now. And toilet paper.
You forgot liquor! Lines out the door!
If you watch your pennies, your dollars will take care of themselves.

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nps
Posts: 1029
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Re: Coronavirus and the market

Post by nps » Sun Mar 22, 2020 6:46 pm

sambb wrote:
Sun Mar 22, 2020 6:36 pm
Well said. The virus added RISK to any asset allocaiton, that was a black swan risk. Unlike other black swans, could see this coming, but many BH criticized those pointing out the black swan. Now, probably too late to get out? may be headed to dow 15000. lots of those who rebalanced to a different allocation due to a change in perception of risk and discomfort, are going to be fine.
Not the definition of rebalancing.

epilnk
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Re: Coronavirus and the market

Post by epilnk » Sun Mar 22, 2020 7:17 pm

Ruger23 wrote:
Sun Mar 22, 2020 5:49 pm
Prahasaurus wrote:
Sun Mar 22, 2020 5:42 pm
It's really, really bad. And as I've stated her a number of times, I believe much worse that what is already priced in. I think the country is still in denial. And as I've noted here many times, there are a number of events that will almost certainly happen in the coming weeks that I believe will take the market lower. I think our biggest problem, the elephant in the room, cannot even be discussed on this site, because of posting rules...

But having said all of that, I do think we'll get through this. It may take 7-10 years for the market to fully recover, but it will recover. Things are very grim now, and will get worse before getting better, but I still have hope.

The main thing is to stay healthy over the coming weeks and months. Hopefully the heat will slow the virus, and we can regroup in the summer.
Agreed and those rules limit an honest and full discussion
Yes, and those rules are the reason I almost never participate here. I’ve been a member since back in the M* days, probably around 2003 or so, and used to be a very active participant. Every so often I check back in, but it’s never long before I remember why I stopped coming here.

This is not my playground, and I recognize the moderators’ right to run the forum as they see fit. The majority prefers things as they are, and those of us who don’t care for it know where the door is. Most of my favorite posters are long gone anyway. Still, I keep hoping someone creates or discovers a forum for the rest of us. So if anyone knows of alternative discussion groups that are consistent with this style of investing but permit broader conversations, I’d appreciate learning about them.

JHU ALmuni
Posts: 189
Joined: Tue Jan 20, 2015 12:40 pm

Re: Coronavirus and the market

Post by JHU ALmuni » Sun Mar 22, 2020 7:22 pm

This is a disaster the market is ~40% down from ATH it took years to get here and only few weeks to collapse. Maybe staying the course isn't that ideal after all. Yes, the market will come back up but in the mean time this devastating.

Ruger23
Posts: 11
Joined: Thu Mar 19, 2020 6:36 pm

Re: Coronavirus and the market

Post by Ruger23 » Sun Mar 22, 2020 7:26 pm

epilnk wrote:
Sun Mar 22, 2020 7:17 pm
Ruger23 wrote:
Sun Mar 22, 2020 5:49 pm
Prahasaurus wrote:
Sun Mar 22, 2020 5:42 pm
It's really, really bad. And as I've stated her a number of times, I believe much worse that what is already priced in. I think the country is still in denial. And as I've noted here many times, there are a number of events that will almost certainly happen in the coming weeks that I believe will take the market lower. I think our biggest problem, the elephant in the room, cannot even be discussed on this site, because of posting rules...

But having said all of that, I do think we'll get through this. It may take 7-10 years for the market to fully recover, but it will recover. Things are very grim now, and will get worse before getting better, but I still have hope.

The main thing is to stay healthy over the coming weeks and months. Hopefully the heat will slow the virus, and we can regroup in the summer.
Agreed and those rules limit an honest and full discussion
Yes, and those rules are the reason I almost never participate here. I’ve been a member since back in the M* days, probably around 2003 or so, and used to be a very active participant. Every so often I check back in, but it’s never long before I remember why I stopped coming here.

This is not my playground, and I recognize the moderators’ right to run the forum as they see fit. The majority prefers things as they are, and those of us who don’t care for it know where the door is. Most of my favorite posters are long gone anyway. Still, I keep hoping someone creates or discovers a forum for the rest of us. So if anyone knows of alternative discussion groups that are consistent with this style of investing but permit broader conversations, I’d appreciate learning about them.
+1. Old member here who lost my old login info and no longer have access to the email account when I registered

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