So bottom is probably behind us....right?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
User avatar
sperry8
Posts: 2102
Joined: Sat Mar 29, 2008 9:25 pm
Location: Miami FL

Re: So bottom is probably behind us....right?

Post by sperry8 » Wed Mar 25, 2020 11:47 am

livesoft wrote:
Wed Mar 25, 2020 6:12 am
Not if past debacles are any indication of what might happen.
Agreed. This all just started. I believe (for whatever thats worth) this is the suckers rally. A retest of the lows usually occurs... the question is does the low hold or do we go on to newer lows. It would be different this time if this was a V recovery without a retest. We shall see.

But do understand markets move in advance of data/articles. So when the bottom is hit and the rally is upon us - do not wait for the data to show it. While the market is recovering, the data will still be horrible.
BH contest results: 2019: #233 of 645 | 18: #150 of 493 | 17: #516 of 647 | 16: #121 of 610 | 15: #18 of 552 | 14: #225 of 503 | 13: #383 of 433 | 12: #366 of 410 | 11: #113 of 369 | 10: #53 of 282

caffeperfavore
Posts: 313
Joined: Thu Aug 06, 2015 11:45 am

Re: So bottom is probably behind us....right?

Post by caffeperfavore » Wed Mar 25, 2020 11:50 am

This has barely even begun.

Swivelguy
Posts: 382
Joined: Sun Jan 18, 2009 11:37 pm

Re: So bottom is probably behind us....right?

Post by Swivelguy » Wed Mar 25, 2020 11:51 am

ImUrHuckleberry wrote:
Wed Mar 25, 2020 11:38 am
I would be shocked if we've hit the bottom. But I would not be shocked to end up being wrong in the end. But I'm planning and expecting that the bottom will be much lower.
If we have hit the bottom, you'd be shocked, but if you're wrong, meaning that we have hit the bottom, you'd NOT be shocked. You've gotta pick one! Shock or no shock?! :mrgreen:

Jim180
Posts: 431
Joined: Wed Jun 26, 2013 9:47 pm

Re: So bottom is probably behind us....right?

Post by Jim180 » Wed Mar 25, 2020 11:54 am

This is just a counter-trend rally within the bear market. Lot's of unknowns that can make the market head South again such as worse than expected economic data, maybe the economy doesn't restart by Easter and finally the virus could get worse in other areas besides NY.

ImUrHuckleberry
Posts: 414
Joined: Sat Apr 15, 2017 7:44 am

Re: So bottom is probably behind us....right?

Post by ImUrHuckleberry » Wed Mar 25, 2020 11:54 am

Swivelguy wrote:
Wed Mar 25, 2020 11:51 am
ImUrHuckleberry wrote:
Wed Mar 25, 2020 11:38 am
I would be shocked if we've hit the bottom. But I would not be shocked to end up being wrong in the end. But I'm planning and expecting that the bottom will be much lower.
If we have hit the bottom, you'd be shocked, but if you're wrong, meaning that we have hit the bottom, you'd NOT be shocked. You've gotta pick one! Shock or no shock?! :mrgreen:
I did pick one: I would be shocked if we hit the bottom. But of course there have been other times I would have been shocked if things happened which actually ended up happening. So of course I wouldn't be shocked to find out the thing I would be shocked to have happened actually ended up happening. It would be shocking for me not to believe that!

User avatar
nisiprius
Advisory Board
Posts: 40808
Joined: Thu Jul 26, 2007 9:33 am
Location: The terrestrial, globular, planetary hunk of matter, flattened at the poles, is my abode.--O. Henry

Re: So bottom is probably behind us....right?

Post by nisiprius » Wed Mar 25, 2020 11:54 am

In 'A Tale of Two Cities,' Charles Dickens wrote:It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way— in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.

theorist
Posts: 614
Joined: Sat Sep 28, 2019 11:39 am

Re: So bottom is probably behind us....right?

Post by theorist » Wed Mar 25, 2020 11:57 am

I obviously don’t know, but I’d be surprised if we’ve seen the bottom. My biggest concern: China learns that it needs to take stricter measures once again, and its economy does not ramp back up. That would likely mean we and Europe would have the same fate after a first few weeks of lockdown.

We have seen attempts to make legislation to get us through a few weeks of shelter in place, while trying to keep small businesses afloat and workers paid enough to feed their children and pay their rent. Can we extend this to several such periods over two years?

That said, I’m fully invested and in fact was shoveling in discretionary $$ when the market was down over 30%, so I must not be too pessimistic for the long term! 🙂

User avatar
Portfolio7
Posts: 833
Joined: Tue Aug 02, 2016 3:53 am

Re: So bottom is probably behind us....right?

Post by Portfolio7 » Wed Mar 25, 2020 11:57 am

No, I wouldn't call it probable. In fact I'd be surprised if we have hit bottom. I think there is still a lot of bad news to process, and a couple negative surprises will send us to lower prices yet.

Otoh, if the surprises are mostly positive moving forward then yes, that may have been the bottom.

This uncertainty let me to split my rebalance in half. I did about half the rebalance on Monday, close of market. That was lucky.

The other half I'll do in a month or more. We'll see how that plays out.
"An investment in knowledge pays the best interest" - Benjamin Franklin

petulant
Posts: 1236
Joined: Thu Sep 22, 2016 1:09 pm

Re: So bottom is probably behind us....right?

Post by petulant » Wed Mar 25, 2020 11:58 am

dharrythomas wrote:
Wed Mar 25, 2020 7:48 am
Nobody knows nothing!

But if we’re doing poetry:

If—
Rudyard Kipling - 1865-1936

If you can keep your head when all about you
Are losing theirs and blaming it on you;
If you can trust yourself when all men doubt you,
But make allowance for their doubting too;

If you can wait and not be tired by waiting,
Or, being lied about, don’t deal in lies,
Or, being hated, don’t give way to hating,
And yet don’t look too good, nor talk too wise;

If you can dream—and not make dreams your master;
If you can think—and not make thoughts your aim;
If you can meet with triumph and disaster
And treat those two impostors just the same;
If you can bear to hear the truth you’ve spoken
Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to broken,
And stoop and build ’em up with wornout tools;

If you can make one heap of all your winnings
And risk it on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breathe a word about your loss;
If you can force your heart and nerve and sinew
To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: “Hold on”;

If you can talk with crowds and keep your virtue,
Or walk with kings—nor lose the common touch;
If neither foes nor loving friends can hurt you;
If all men count with you, but none too much;
If you can fill the unforgiving minute
With sixty seconds’ worth of distance run—
Yours is the Earth and everything that’s in it,
And—which is more—you’ll be a Man, my son


Good luck with whatever you decide!
This was beautiful. Thank you for sharing.

Corsair
Posts: 348
Joined: Mon Oct 21, 2019 9:57 am
Location: WA

Re: So bottom is probably behind us....right?

Post by Corsair » Wed Mar 25, 2020 12:01 pm

Market is way too expensive for me given the possible downside risks. Virus infection curve is still growing. Will wait for unemployment numbers tomorrow and earnings to start coming in. House hasn't even passed the bill yet. Add in funds are/will rebalance for 3/31; will see what happens in April afterwards.

20% back into the market on a 65/35 after selling in Feb. Weighted AVG buy-in S&P 2400.
Stocks only go up?

btenny
Posts: 5360
Joined: Sun Oct 07, 2007 6:47 pm

Re: So bottom is probably behind us....right?

Post by btenny » Wed Mar 25, 2020 12:03 pm

I think we are nowhere near the bottom but this is just a guess. Yes people are sort of scared but not enough real damage has occurred.

Ask again in May after we see how the hospitals do when the surge hits. Then repeat the question around November to see if CV19 comes back like other previous pandemics. I am pretty sure some sort of craziness near the election will cause more trouble. But I know this just speculating. I hope the bottom has already occurred.

Good Luck.

MathWizard
Posts: 4057
Joined: Tue Jul 26, 2011 1:35 pm

Re: So bottom is probably behind us....right?

Post by MathWizard » Wed Mar 25, 2020 12:15 pm

Unless there is a cure that is shown to work, I don't think so.

We will have lots of people not working with the shelter in place rules that
states have imposed. Even if the federal govt. ensures that they have a paycheck,
we still are not producing things. I know that there are backlogs for products that I order
for business.

The economy is the flow of money, and that is currently slowed for most things,
so there will be lower earnings. Earnings are what underpin the value of a company.
With the rate at which products/services being sold having slowed, earnings per quarter
will be reduced, which lowers the value of a stock.

boglehooligan
Posts: 7
Joined: Mon Mar 23, 2020 11:38 am

Re: So bottom is probably behind us....right?

Post by boglehooligan » Wed Mar 25, 2020 12:21 pm

As per Warren Buffet's thinking, the Market is "Significantly overvalued"
https://www.gurufocus.com/stock-market-valuations.php

And if you ask Robert Shiller, he would probably tell you the same thing :(
https://www.multpl.com/shiller-pe

Corsair
Posts: 348
Joined: Mon Oct 21, 2019 9:57 am
Location: WA

Re: So bottom is probably behind us....right?

Post by Corsair » Wed Mar 25, 2020 12:26 pm

boglehooligan wrote:
Wed Mar 25, 2020 12:21 pm
As per Warren Buffet's thinking, the Market is "Significantly overvalued"
https://www.gurufocus.com/stock-market-valuations.php

And if you ask Robert Shiller, he would probably tell you the same thing :(
https://www.multpl.com/shiller-pe
Thanks for sharing the Buffet indicator :beer

Honestly who is buying at these prices in a bear market? I'm not surprised, however, as I do believe the Fed and Administration will do everything in their power to keep the market up.
Last edited by Corsair on Wed Mar 25, 2020 12:29 pm, edited 1 time in total.
Stocks only go up?

DonIce
Posts: 1102
Joined: Thu Feb 21, 2019 6:44 pm

Re: So bottom is probably behind us....right?

Post by DonIce » Wed Mar 25, 2020 12:27 pm

The virus is still growing exponentially in the US. In ~2 days, we'll have more cases than China. Another day or two after, we'll be past 100k. By end of the month, we may be at about a quarter million. Somehow I don't think the markets will react placidly to passing these milestones. But you never know.

User avatar
KingRiggs
Posts: 490
Joined: Wed Dec 12, 2018 12:19 pm
Location: Indiana

Re: So bottom is probably behind us....right?

Post by KingRiggs » Wed Mar 25, 2020 12:32 pm

I don't know nuthin'.

I know that I rebalanced once, I am currently within my rebalance bands, and I'm going to keep making contributions according to my AA.
Advice = noun | Advise = verb | | Roth, not ROTH

Rosencrantz1
Posts: 512
Joined: Tue Sep 10, 2019 12:28 pm

Re: So bottom is probably behind us....right?

Post by Rosencrantz1 » Wed Mar 25, 2020 12:36 pm

tvubpwcisla wrote:
Wed Mar 25, 2020 7:12 am
I certainly hope so! I wouldn't mind seeing the new virus infection rate decrease for a few days in a row.
Agreed. I've been tracking the new infection rates in a few states and it appears the numbers are climbing each day. Until, those numbers plateau or, better yet, begin to decrease, I wouldn't bet on a market bottom being behind us. I suspect we'll see new lows. \0.02 cents

DaftInvestor
Posts: 5219
Joined: Wed Feb 19, 2014 10:11 am

Re: So bottom is probably behind us....right?

Post by DaftInvestor » Wed Mar 25, 2020 12:36 pm

Yes the bottom is definitely behind us. All markets up again today - 2 in a row.
BUT - we may turn around and have it in front of us as well.
Last edited by DaftInvestor on Wed Mar 25, 2020 12:36 pm, edited 1 time in total.

BusterScruggs
Posts: 25
Joined: Wed Aug 21, 2019 10:00 am

Re: So bottom is probably behind us....right?

Post by BusterScruggs » Wed Mar 25, 2020 12:36 pm

Nobody knows. Eventually the market will go up. This seems to be a strange event where we PURPOSEFULLY put the economy on lockdown and stopped the heartbeat. I suspect when the heart starts back up it will need some rehab before sprinting again.

I would think likely scenarios like a major political figure getting very ill, entertainment or celebrities getting ill or worse will make the markets gyrate.

I feel good that we will lick this thing and getting on the other side of the curve, progress in palliative treatments etc will make the market gyrate up.

Have faith everyone!

Vanguard Fan 1367
Posts: 1578
Joined: Wed Feb 08, 2017 3:09 pm

Re: So bottom is probably behind us....right?

Post by Vanguard Fan 1367 » Wed Mar 25, 2020 12:39 pm

I haven't read all the posts but I believe that Saint Jack said: "nobody knows nothing" as far as answering if the bottom is probably behind us. https://youtu.be/fLCfkmaqI6k
Upton Sinclair: "It is difficult to get a man to understand something when his salary depends on his not understanding it."

LiterallyIronic
Posts: 1449
Joined: Sat Dec 05, 2015 10:36 am

Re: So bottom is probably behind us....right?

Post by LiterallyIronic » Wed Mar 25, 2020 12:49 pm

I've thought the bottom was behind us every single day. That's why I simply buy and hold.

User avatar
mrspock
Posts: 980
Joined: Tue Feb 13, 2018 2:49 am
Location: Vulcan

Re: So bottom is probably behind us....right?

Post by mrspock » Wed Mar 25, 2020 12:56 pm

Corsair wrote:
Wed Mar 25, 2020 12:26 pm
boglehooligan wrote:
Wed Mar 25, 2020 12:21 pm
As per Warren Buffet's thinking, the Market is "Significantly overvalued"
https://www.gurufocus.com/stock-market-valuations.php

And if you ask Robert Shiller, he would probably tell you the same thing :(
https://www.multpl.com/shiller-pe
Thanks for sharing the Buffet indicator :beer

Honestly who is buying at these prices in a bear market? I'm not surprised, however, as I do believe the Fed and Administration will do everything in their power to keep the market up.
I bought 6 figures last Thursday. This is easy money.... keep selling boys and girls, I'm sitting on a 46% gain to even, looking forward to 100% on my next round (-50%). No matter how many times everyone sees the movie, they just can't help but think the ending is different this time. You see, when you buy low.... and HOLD, you win no matter what.

P.S. Robert Shiller is a perma-bear. And CAPE has been indicating over-value for the last 10 years, congrats... you'd still be down (vs. the S&P) if you listened to him.

Corsair
Posts: 348
Joined: Mon Oct 21, 2019 9:57 am
Location: WA

Re: So bottom is probably behind us....right?

Post by Corsair » Wed Mar 25, 2020 1:04 pm

mrspock wrote:
Wed Mar 25, 2020 12:56 pm
Corsair wrote:
Wed Mar 25, 2020 12:26 pm
boglehooligan wrote:
Wed Mar 25, 2020 12:21 pm
As per Warren Buffet's thinking, the Market is "Significantly overvalued"
https://www.gurufocus.com/stock-market-valuations.php

And if you ask Robert Shiller, he would probably tell you the same thing :(
https://www.multpl.com/shiller-pe
Thanks for sharing the Buffet indicator :beer

Honestly who is buying at these prices in a bear market? I'm not surprised, however, as I do believe the Fed and Administration will do everything in their power to keep the market up.
I bought 6 figures last Thursday. This is easy money.... keep selling boys and girls, I'm sitting on a 46% gain to even, looking forward to 100% on my next round (-50%). No matter how many times everyone sees the movie, they just can't help but think the ending is different this time. You see, when you buy low.... and HOLD, you win no matter what.

P.S. Robert Shiller is a perma-bear. And CAPE has been indicating over-value for the last 10 years, congrats... you'd still be down (vs. the S&P) if you listened to him.
I've had been buying as well but won't continue in bulk at these prices. You and I have similar buy-in values (both around 2400) but I'm only 20% back in.
Stocks only go up?

keelerjr12
Posts: 128
Joined: Tue Jan 13, 2015 2:56 am

Re: So bottom is probably behind us....right?

Post by keelerjr12 » Wed Mar 25, 2020 1:08 pm

Bought again earlier this morning as well. Was about 20% below my projected cost basis so in essence still doing better than if I had just DCA’d and bought and held. Was it the absolute bottom? No, and there’s no way I could tell that. But a profit is a profit (especially at 20%).

boglehooligan
Posts: 7
Joined: Mon Mar 23, 2020 11:38 am

Re: So bottom is probably behind us....right?

Post by boglehooligan » Wed Mar 25, 2020 1:13 pm

Corsair wrote:
Wed Mar 25, 2020 1:04 pm
mrspock wrote:
Wed Mar 25, 2020 12:56 pm
Corsair wrote:
Wed Mar 25, 2020 12:26 pm
boglehooligan wrote:
Wed Mar 25, 2020 12:21 pm
As per Warren Buffet's thinking, the Market is "Significantly overvalued"
https://www.gurufocus.com/stock-market-valuations.php

And if you ask Robert Shiller, he would probably tell you the same thing :(
https://www.multpl.com/shiller-pe
Thanks for sharing the Buffet indicator :beer

Honestly who is buying at these prices in a bear market? I'm not surprised, however, as I do believe the Fed and Administration will do everything in their power to keep the market up.
I bought 6 figures last Thursday. This is easy money.... keep selling boys and girls, I'm sitting on a 46% gain to even, looking forward to 100% on my next round (-50%). No matter how many times everyone sees the movie, they just can't help but think the ending is different this time. You see, when you buy low.... and HOLD, you win no matter what.

P.S. Robert Shiller is a perma-bear. And CAPE has been indicating over-value for the last 10 years, congrats... you'd still be down (vs. the S&P) if you listened to him.
I've had been buying as well but won't continue in bulk at these prices. You and I have similar buy-in values (both around 2400) but I'm only 20% back in.
Agreed - continue buying no matter what
And I wouldn't be pulling out my "Warren Buffet Elephant Gun" just yet 8-)

User avatar
bertilak
Posts: 7384
Joined: Tue Aug 02, 2011 5:23 pm
Location: East of the Pecos, West of the Mississippi

Re: So bottom is probably behind us....right?

Post by bertilak » Wed Mar 25, 2020 1:18 pm

DizzyHippoMan wrote:
Wed Mar 25, 2020 7:56 am
thank you...that was new to me
It is true, Kipling has gone out of fashion. That's partly why he is my Avatar, the other part being I think he is masterful. That poem is an example.

Here is an example of his prose. It is a passage from KIM, where an old soldier, retired after many battles, remarks on the busy Grand Trunk Road [in India] as he walks along it with Kim and the Lama for a short while.
  • All casts and kinds of men move here. Look! Brahmins and chumars, bankers and tinkers, barbers and bunnias, pilgrims and potters – all the world going and coming. It is to me as a river from which I have withdrawn like a log after a flood.
May neither drought nor rain nor blizzard disturb the joy juice in your gizzard. -- Squire Omar Barker (aka S.O.B.), the Cowboy Poet

User avatar
Mountain Doc
Posts: 167
Joined: Tue Aug 08, 2017 3:15 pm
Location: Life Elevated

Re: So bottom is probably behind us....right?

Post by Mountain Doc » Wed Mar 25, 2020 1:31 pm

Tiny Portfolio wrote:
Wed Mar 25, 2020 7:03 am
unemployment numbers haven't come out yet, remember the most recent jobs report added 275k jobs
Quarterly earning haven't come out yet, the most recent earnings reports were positive.
GDP number haven't come out yet, again the last GDP number we have are positive albeit low.
No news of massive layoffs has hit..... yet.
No 100+ year old too big to fail companies have went belly up...Yet
No mass credit card defaults...yet
No mass car repos....yet
No mass foreclosures....yet
No spike in bankruptcies...yet


None of these are guaranteed to happen and only a few might, but as of right now they are all still unknown. Until we can cross them off the list how can this be the bottom?
The market is forward looking, and buyers/sellers today are factoring in some amount of future layoffs/defaults/repos/etc into today's prices. If those future events turn out to be less bad than today's buyers/sellers predict, then the market will rise. If those future events are worse than today's buyers/sellers predict, then prices will fall. Saying "the news will get worse" does NOT imply the market will get worse.

aristotelian
Posts: 7419
Joined: Wed Jan 11, 2017 8:05 pm

Re: So bottom is probably behind us....right?

Post by aristotelian » Wed Mar 25, 2020 1:32 pm

Talk about recency bias. Did you forget how fast the market just dropped before this bounce? With the current level of volatility, just a couple days of bad news could easily erase these gains. Or this could turn into a 2001 type of slide that goes on for a while.

Enzo IX
Posts: 278
Joined: Wed Jul 23, 2008 4:07 am

Re: So bottom is probably behind us....right?

Post by Enzo IX » Wed Mar 25, 2020 1:35 pm

My guess is this is a bounce off of some perceived good news as well as a traders squeeze.

The market is swinging way too much to be a bottom.

Keenobserver
Posts: 273
Joined: Thu Aug 13, 2015 1:05 pm

Re: So bottom is probably behind us....right?

Post by Keenobserver » Wed Mar 25, 2020 1:43 pm

Here in NY, the rates are going bonkers...everyone knows someone who tested positive.. Even young pts are in serious conditions. Unless there appears a magic cure from nowhere, this is going to get worse. Now, maybe the market already factored that in when it tanked. Fair enough, but WTH exaplains this ridiculous rally? News is getting worse, and on the other ha d we have a tremensous rally. What else is this, if not a false rally? I cant see this sustained.

Call_Me_Op
Posts: 7804
Joined: Mon Sep 07, 2009 2:57 pm
Location: Milky Way

Re: So bottom is probably behind us....right?

Post by Call_Me_Op » Wed Mar 25, 2020 1:46 pm

My suggestion would be to tally-up the opinions and then assume the opposite is true.
Best regards, -Op | | "In the middle of difficulty lies opportunity." Einstein

User avatar
Dale_G
Posts: 3371
Joined: Tue Feb 20, 2007 5:43 pm
Location: Central Florida - on the grown up side of 83

Re: So bottom is probably behind us....right?

Post by Dale_G » Wed Mar 25, 2020 1:47 pm

I am an optimist, but I believe the "bottom" will be well below what we have seen - and still months away. I doubt the market has priced in cases in New York exceeding the total number of cases in China.

There is a lot of damage to the economy and there will be much more. While the "stimulus" is necessary, it is not free money.

I am, and will be buying equities, but I will try to be very patient.

Dale
Last edited by Dale_G on Wed Mar 25, 2020 1:47 pm, edited 1 time in total.
Volatility is my friend

User avatar
vitaflo
Posts: 1263
Joined: Sat Sep 03, 2011 3:02 pm

Re: So bottom is probably behind us....right?

Post by vitaflo » Wed Mar 25, 2020 1:47 pm

I'm guessing the market has already priced in the fact that many many more will get sick, that there will be higher unemployment and that some companies (perhaps mainly smaller ones) will close up shop. I say this because it seems that this is the general consensus, so certainly it wouldn't be unexpected if it happened.

Since changes in stocks are based on future expectations, the question really becomes what is going to happen that is not the current expectation. Only then will we know which way the market is going to move. But if we knew that then it would be the expectation and since it's not, we can't know where things will go.

User avatar
tetractys
Posts: 4777
Joined: Sat Mar 17, 2007 3:30 pm
Location: Along the Salish Sea

Re: So bottom is probably behind us....right?

Post by tetractys » Wed Mar 25, 2020 1:53 pm

Today it’s all about Covid 19 effects and fallout. Tomorrow the unknowns will come into play. The only judgements worth making today are to avoid panic and follow your plan.

Theoretically the Covid 19 crisis could be over within a month; but that belays other factors that in some cases may be unforeseen.
Last edited by tetractys on Wed Mar 25, 2020 1:58 pm, edited 1 time in total.

J45
Posts: 60
Joined: Mon Sep 30, 2019 12:39 pm

Re: So bottom is probably behind us....right?

Post by J45 » Wed Mar 25, 2020 1:56 pm

I dont know much about markets. But from healthcare prospective, since this is the main factor affecting the markets, I think we still are far from the bottom.

Question is have we already had the worst of the virus wave? No

I would wait or small additions, timed with the significant drops may be helpful in the long run.

new2bogle
Posts: 1546
Joined: Fri Sep 11, 2009 2:05 pm

Re: So bottom is probably behind us....right?

Post by new2bogle » Wed Mar 25, 2020 1:57 pm

The bottom is (for dow) 18,186. Since we haven't reached that yet, no the bottom is not behind us. In the meantime, I continue to buy and hold as I don't know nothin'.

TIAX
Posts: 1316
Joined: Sat Jan 11, 2014 12:19 pm

Re: So bottom is probably behind us....right?

Post by TIAX » Wed Mar 25, 2020 1:59 pm

Ramjet wrote:
Wed Mar 25, 2020 6:46 am
watchnerd wrote:
Wed Mar 25, 2020 6:17 am
No, I don't think we're at the bottom yet, it's probably an intermission between Act I (de-risking) and Act II (earnings and unemployment numbers come in).
I also think the unemployment numbers are going to be surprising to many
See this article estimating that 3.4 million filed for unemployment last week.

reln
Posts: 211
Joined: Fri Apr 19, 2019 4:01 pm

Re: So bottom is probably behind us....right?

Post by reln » Wed Mar 25, 2020 2:05 pm

Yes, the bottom is in.

MindBogler
Posts: 975
Joined: Wed Apr 17, 2013 12:05 pm

Re: So bottom is probably behind us....right?

Post by MindBogler » Wed Mar 25, 2020 2:07 pm

I don't have any crystal ball but I did finally execute my rebalance moves this week. I hope we are there but won't be surprised if it continues to slide a bit more.

Topic Author
dbadalam
Posts: 69
Joined: Wed Jul 08, 2015 8:04 am

Re: So bottom is probably behind us....right?

Post by dbadalam » Wed Mar 25, 2020 2:08 pm

Most posters seem pessimistic but the market is soaring for the 2nd day in a row. Maybe the bottom already hit.

am
Posts: 3387
Joined: Sun Sep 30, 2007 9:55 am

Re: So bottom is probably behind us....right?

Post by am » Wed Mar 25, 2020 2:09 pm

Dale_G wrote:
Wed Mar 25, 2020 1:47 pm
I am an optimist, but I believe the "bottom" will be well below what we have seen - and still months away. I doubt the market has priced in cases in New York exceeding the total number of cases in China.

There is a lot of damage to the economy and there will be much more. While the "stimulus" is necessary, it is not free money.

I am, and will be buying equities, but I will try to be very patient.

Dale
Perhaps 2 trillion in stimulus could overcome even the worst of news or maybe traders think that no matter how bad things will get, more stimulus (printing presses) will come and keep the economy going?

JackoC
Posts: 1249
Joined: Sun Aug 12, 2018 11:14 am

Re: So bottom is probably behind us....right?

Post by JackoC » Wed Mar 25, 2020 2:11 pm

Mountain Doc wrote:
Wed Mar 25, 2020 1:31 pm
Tiny Portfolio wrote:
Wed Mar 25, 2020 7:03 am
unemployment numbers haven't come out yet, remember the most recent jobs report added 275k jobs
Quarterly earning haven't come out yet, the most recent earnings reports were positive.
GDP number haven't come out yet, again the last GDP number we have are positive albeit low.
No news of massive layoffs has hit..... yet.
No 100+ year old too big to fail companies have went belly up...Yet
No mass credit card defaults...yet
No mass car repos....yet
No mass foreclosures....yet
No spike in bankruptcies...yet
None of these are guaranteed to happen and only a few might, but as of right now they are all still unknown. Until we can cross them off the list how can this be the bottom?
The market is forward looking, and buyers/sellers today are factoring in some amount of future layoffs/defaults/repos/etc into today's prices. If those future events turn out to be less bad than today's buyers/sellers predict, then the market will rise. If those future events are worse than today's buyers/sellers predict, then prices will fall. Saying "the news will get worse" does NOT imply the market will get worse.
Yeah, the post you responded to is one of now innumerable ones which are probably a good explanation why some very optimistic people (perhaps also posting on this forum, but if not certainly speaking other places, arguably including some political leaders) are likely to have their optimism severely tested in coming weeks and months. However, positing that the market's prices are based on what those optimistic people think is a much more aggressive assumption. How do you know how much if at all the pricing of the S&P at this moment is based on underestimating any of the factors listed? It's virtually certainly not based on assuming 'no' for all of them.

There's some scope to improve the estimate perhaps, look fundamentally at prices and the effect of the virus in quantitative terms of earnings (keeping in mind stock are perpetual instruments). But in my blunt opinion, posts that just say 'the market is still overvalued, the proof is all these overly optimistic people' are pretty much devoid of value.

That's not said from an especially bullish POV. From a basic risk perspective if the VIX is 61 and you imagine with a bit of oversimplification the market racing through a binomial tree with the variance thereby implied, then obviously there are loads of potential paths crossing levels far below the recent low...though also many that never get back to the recent low. Anyway I think you can actually say something concrete about *risk*, that money you put in now ('just staying the course by rebalancing' or whatever else, I just mean clicking 'buy') is money at much greater risk of loss than money you put in when the VIX was in the teens. And the existing corpus of your stock investments is also at much greater risk on a % basis than it was, although that's ameliorated on a $ basis by it being a smaller amount...because you've lost money already.

But trying to figure out what scenario the market has priced in based on some unscientific sample of small investor thinking is entirely hopeless IMO. For another thing you have to consider the market will move lower only as weaker hands turn their stocks over to stronger ones. If it's now optimistic people who are going to crack and sell at some point that could be a predictor, but if they are optimists stubborn enough to hang on at all cost, overoptimism doesn't indicate anything. How would anyone know which kind of person they are really debating with? Besides of course having no idea how representative of the market (on a *$* weighted basis, which is all the matters) they are. Zero predictive value I think.

MindBogler
Posts: 975
Joined: Wed Apr 17, 2013 12:05 pm

Re: So bottom is probably behind us....right?

Post by MindBogler » Wed Mar 25, 2020 2:27 pm

mrspock wrote:
Wed Mar 25, 2020 2:12 pm
Public health officials are not economists, nor are they politicians, or right 100% of the time. Furthermore, COVID-19 testing regimes IMO, are a complete embarrassment to the branch of Mathematics known as "Statistics" -- no random sampling, no consistency, reporting numerators without denominators. They are clearly messaging "worse case" outcomes to get people to do the right thing (self isolation), as one might in their position, this means that it's pretty likely this turns out a lot less bad than anyone might think if they are listening to these officials. It turns out, what makes for good public health policy (scaring people into doing the right thing), is a recipe for disaster for anxiety prone investors.
This should be a sticky.

Rosencrantz1
Posts: 512
Joined: Tue Sep 10, 2019 12:28 pm

Re: So bottom is probably behind us....right?

Post by Rosencrantz1 » Wed Mar 25, 2020 2:32 pm

mrspock wrote:
Wed Mar 25, 2020 12:56 pm
Corsair wrote:
Wed Mar 25, 2020 12:26 pm
boglehooligan wrote:
Wed Mar 25, 2020 12:21 pm
As per Warren Buffet's thinking, the Market is "Significantly overvalued"
https://www.gurufocus.com/stock-market-valuations.php

And if you ask Robert Shiller, he would probably tell you the same thing :(
https://www.multpl.com/shiller-pe
Thanks for sharing the Buffet indicator :beer

Honestly who is buying at these prices in a bear market? I'm not surprised, however, as I do believe the Fed and Administration will do everything in their power to keep the market up.
I bought 6 figures last Thursday. This is easy money.... keep selling boys and girls, I'm sitting on a 46% gain to even, looking forward to 100% on my next round (-50%). No matter how many times everyone sees the movie, they just can't help but think the ending is different this time. You see, when you buy low.... and HOLD, you win no matter what.

P.S. Robert Shiller is a perma-bear. And CAPE has been indicating over-value for the last 10 years, congrats... you'd still be down (vs. the S&P) if you listened to him.
Impressive. I can't bring myself to go with quite that much all at once - I've been buying 25 share lots of VOO on the way down. I have, however, also bought a few individual names and, so far, they're doing nicely with this (maybe) dead cat bounce. :beer

Retired2013
Posts: 236
Joined: Sat Dec 12, 2015 2:53 pm

Re: So bottom is probably behind us....right?

Post by Retired2013 » Wed Mar 25, 2020 2:34 pm

I believe we'll test the lows again.

No earnings out yet and not at the end of the virus, which will spread across the US.

As for the bill that is about to pass. Why did they pick a March 24, 2020 date for the business employee count. To me, that means every employee that has already been laid off will continue to be laid off. Tomorrows weekly unemployment filing report will tell you all of those employees that are not eligible for the business guarantee (100% of full pay for four months). I think that was a mistake in the bill. The date should have been retro back a couple of weeks.

lostdog
Posts: 2693
Joined: Thu Feb 04, 2016 2:15 pm

Re: So bottom is probably behind us....right?

Post by lostdog » Wed Mar 25, 2020 2:37 pm

I don't know.

Live long and prosper.
Global Market Cap Equity || Taxable: VTSAX+VTIAX || IRA: VTWAX

User avatar
Mountain Doc
Posts: 167
Joined: Tue Aug 08, 2017 3:15 pm
Location: Life Elevated

Re: So bottom is probably behind us....right?

Post by Mountain Doc » Wed Mar 25, 2020 2:38 pm

JackoC wrote:
Wed Mar 25, 2020 2:11 pm
Mountain Doc wrote:
Wed Mar 25, 2020 1:31 pm
Tiny Portfolio wrote:
Wed Mar 25, 2020 7:03 am
unemployment numbers haven't come out yet, remember the most recent jobs report added 275k jobs
Quarterly earning haven't come out yet, the most recent earnings reports were positive.
GDP number haven't come out yet, again the last GDP number we have are positive albeit low.
No news of massive layoffs has hit..... yet.
No 100+ year old too big to fail companies have went belly up...Yet
No mass credit card defaults...yet
No mass car repos....yet
No mass foreclosures....yet
No spike in bankruptcies...yet
None of these are guaranteed to happen and only a few might, but as of right now they are all still unknown. Until we can cross them off the list how can this be the bottom?
The market is forward looking, and buyers/sellers today are factoring in some amount of future layoffs/defaults/repos/etc into today's prices. If those future events turn out to be less bad than today's buyers/sellers predict, then the market will rise. If those future events are worse than today's buyers/sellers predict, then prices will fall. Saying "the news will get worse" does NOT imply the market will get worse.
Yeah, the post you responded to is one of now innumerable ones which are probably a good explanation why some very optimistic people (perhaps also posting on this forum, but if not certainly speaking other places, arguably including some political leaders) are likely to have their optimism severely tested in coming weeks and months. However, positing that the market's prices are based on what those optimistic people think is a much more aggressive assumption. How do you know how much if at all the pricing of the S&P at this moment is based on underestimating any of the factors listed? It's virtually certainly not based on assuming 'no' for all of them.

There's some scope to improve the estimate perhaps, look fundamentally at prices and the effect of the virus in quantitative terms of earnings (keeping in mind stock are perpetual instruments). But in my blunt opinion, posts that just say 'the market is still overvalued, the proof is all these overly optimistic people' are pretty much devoid of value.

That's not said from an especially bullish POV. From a basic risk perspective if the VIX is 61 and you imagine with a bit of oversimplification the market racing through a binomial tree with the variance thereby implied, then obviously there are loads of potential paths crossing levels far below the recent low...though also many that never get back to the recent low. Anyway I think you can actually say something concrete about *risk*, that money you put in now ('just staying the course by rebalancing' or whatever else, I just mean clicking 'buy') is money at much greater risk of loss than money you put in when the VIX was in the teens. And the existing corpus of your stock investments is also at much greater risk on a % basis than it was, although that's ameliorated on a $ basis by it being a smaller amount...because you've lost money already.

But trying to figure out what scenario the market has priced in based on some unscientific sample of small investor thinking is entirely hopeless IMO. For another thing you have to consider the market will move lower only as weaker hands turn their stocks over to stronger ones. If it's now optimistic people who are going to crack and sell at some point that could be a predictor, but if they are optimists stubborn enough to hang on at all cost, overoptimism doesn't indicate anything. How would anyone know which kind of person they are really debating with? Besides of course having no idea how representative of the market (on a *$* weighted basis, which is all the matters) they are. Zero predictive value I think.
Agreed. I am completely agnostic on where the market will go (just like always). I don't know which path forward the market is currently pricing in, and I don't know which path forward will actually transpire. However, worsening data certainly does not guarantee worsening stock prices.

surfstar
Posts: 2117
Joined: Fri Sep 13, 2013 12:17 pm
Location: Santa Barbara, CA

Re: So bottom is probably behind us....right?

Post by surfstar » Wed Mar 25, 2020 2:40 pm

dbadalam wrote:
Wed Mar 25, 2020 2:08 pm
Most posters seem pessimistic but the market is soaring for the 2nd day in a row. Maybe the bottom already hit.
Maybe. Maybe not.
I don't think Thu/Fri will be up days, though.

Hard to trade on "feelings", though.

We will soon have the most cases of COVID-19 in the world. I'm not sure if the market has really priced that in or has chosen to ignore certain facts and trends. We'll never know until its over, though...

brianH
Posts: 392
Joined: Wed Aug 12, 2009 12:21 pm

Re: So bottom is probably behind us....right?

Post by brianH » Wed Mar 25, 2020 2:41 pm

mrspock wrote:
Wed Mar 25, 2020 2:12 pm
no random sampling, no consistency, reporting numerators without denominators. They are clearly messaging "worse case" outcomes to get people to do the right thing (self isolation), as one might in their position, this means that it's pretty likely this turns out a lot less bad than anyone might think if they are listening to these officials.
I'll add to this a notable lack of useful data reporting the relationship between age/comorbidity and outcome. Where I have seen it, the data has been grouped in to ridiculous quartiles (e.g. age 1-10, 10-20, 20-50, 50-90) to avoid stating what we will likely eventually find out: this, like many illnesses, is only especially dangerous to the very old and/or very sick.

We've been beaten over the head with the worst-case scenario and the market has already been scared to death. As we collect more data and shine more light on what we're looking at, I expect the fear will drop rapidly.

JackoC
Posts: 1249
Joined: Sun Aug 12, 2018 11:14 am

Re: So bottom is probably behind us....right?

Post by JackoC » Wed Mar 25, 2020 2:42 pm

mrspock wrote:
Wed Mar 25, 2020 2:12 pm

Public health officials are not economists, nor are they politicians, or right 100% of the time. Furthermore, COVID-19 testing regimes IMO, are a complete embarrassment to the branch of Mathematics known as "Statistics" -- no random sampling, no consistency, reporting numerators without denominators. They are clearly messaging "worse case" outcomes to get people to do the right thing (self isolation), as one might in their position, this means that it's pretty likely this turns out a lot less bad than anyone might think if they are listening to these officials. It turns out, what makes for good public health policy (scaring people into doing the right thing), is a recipe for disaster for anxiety prone investors.
I think that's a really good point. There might be some statements by authorities which tend to overoptimism, to avoid panic and/or their own perceived political interests especially in case of politicians. But, there is also plenty of scope, politicians and health professionals, to scare people into doing that those authorities very honestly believe they need to do. This is certainly apparent in for example '[X huge number] will be infected' announced with the the caveat 'in a worst case, if we fail to do Y' but you then often see repeated by private individuals including on this forum without the caveat, now as simple unconditional statements

Likewise IMO the general lack of solid current/backward looking statistics is probably a combination of genuine lack of them, but also some mixture of not wanting to scare or relieve people too much. It can't be taken as the absolute down the middle objective truth. They have to consider how average people will react (panic, let their guard down too much, etc).

But (though I cut out the post you responded to because it pointed back to a particular politician) the economy is *not* going to be shut down for 18 months. Because it just can't be. We will have to figure out a way to not do that. Although it will have a trade off in lives lost compared to the (albeit not actually attainable in the real world) baseline of everybody staying home for 18 months. The market realizes basic realities like that as part of its discounting of the impact on *earnings* in pricing a *perpetual instrument*. The S&P isn't a predictions market for health outcomes or human suffering over a period of months.
Last edited by JackoC on Wed Mar 25, 2020 2:47 pm, edited 1 time in total.

Locked