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

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

Post by peskypesky » Thu Mar 26, 2020 6:34 pm

Hogan773 wrote:
Thu Mar 26, 2020 5:14 pm
yeah or if the Fed and US Government catches the dead cat, quickly puts it into an oversized T-shirt cannon and then shoots it straight up in the air again
Doom&Gloom wrote:
Thu Mar 26, 2020 6:22 pm
Flubber Cat
watchnerd wrote:
Thu Mar 26, 2020 6:22 pm
WhiteMaxima wrote:
Thu Mar 26, 2020 6:17 pm
bottom was in 100 years ago. If you invested 10K in a diversified folio 100 years ago and never sell during market correction. Go figure how much the $10k investment worth today. What happend last 3 weeks is just pothole when you look back 5 years later. Stay calm, stay the course.

Are you The Highlander?
hahahahahaha!!!!!

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

Post by ValuationsMatter » Thu Mar 26, 2020 7:14 pm

WhiteMaxima wrote:
Thu Mar 26, 2020 6:17 pm
bottom was in 100 years ago. If you invested 10K in a diversified folio 100 years ago and never sell during market correction. Go figure how much the $10k investment worth today.
If I invested 100 years ago, I'd have worms today. Actually, I wouldn't even have them, anymore! :sharebeer

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

Post by birdog » Thu Mar 26, 2020 7:30 pm

watchnerd wrote:
Thu Mar 26, 2020 6:22 pm
Are you The Highlander?
Relevant question.

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

Post by rockthisworld » Thu Mar 26, 2020 7:31 pm

My guess is that we retest the lows. That’s okay because 2020 will be the time to put your money to work.

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

Post by watchnerd » Thu Mar 26, 2020 7:35 pm

birdog wrote:
Thu Mar 26, 2020 7:30 pm
watchnerd wrote:
Thu Mar 26, 2020 6:22 pm
Are you The Highlander?
Relevant question.
One has to be suspicious of "people" with 100 year investing timespans.
70% Global Market Weight Equities | 15% Long Treasuries 15% short TIPS & cash || RSU + ESPP

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

Post by lostdog » Thu Mar 26, 2020 7:36 pm

Momus wrote:
Thu Mar 26, 2020 12:30 pm
We have about 6M people unemploymed right now at 3.5 -> 8%.

https://docs.google.com/spreadsheets/d/ ... sp=sharing

It's gonna get worse before it's getting better. 10-30% unemployment is possible.

Great depression 2.0.
Doubt it. That's pretty extreme.
Global Market Cap Equity || 6 Months Cash || Staying The Course

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

Post by seychellois_lib » Thu Mar 26, 2020 7:48 pm

adave wrote:
Thu Mar 26, 2020 6:12 pm
Tough to trust the Chinese numbers. US has tested 550k people so far - good work on scaling up testing. 86% of tests negative. Hard to understand this market, I will keep some dry powder available while continuing to nibble here and there.
Yea, testing is really starting to ramp, almost 100K last 24 hours. I'll start to be impressed when we are doing 250-300K a day. Probably need half million a day to really characterize what is going on (maybe more) and get people out of circulation although I am no statistician.

https://covidtracking.com/us-daily/

I am nibbling too although it is limited to a small pool of play money. I am STC on my primary portfolio.

GT99
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Re: So bottom is probably behind us....right?

Post by GT99 » Thu Mar 26, 2020 7:57 pm

Given where the COVID-19 numbers are heading, I'm finding the market's movement the past few days very strange. Feels like too much bounce for the stimulus package, given some of that should have been priced in already (we've known for a while some sort of stimulus was coming). Still feels like there's more panic waiting to get pulled out. We may well see 20,000 new cases tomorrow in the US. A lot more hospitals are about to get pushed passed capacity, which will increase mortality rates. My best guess is that numbers over the weekend are going to be bad enough that come Monday, enough people will be spooked to cause another selloff.

That said, it seems like I'm less pessimistic than average around here. I'd be very surprised if we don't see 2300 S&P again in the next couple weeks. I wouldn't be surprised if we see 2200. I think 2100 is unlikely, but still very possible.

That's my ***GUESS***

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

Post by MindBogler » Thu Mar 26, 2020 8:10 pm

adave wrote:
Thu Mar 26, 2020 6:12 pm
Tough to trust the Chinese numbers. US has tested 550k people so far - good work on scaling up testing. 86% of tests negative. Hard to understand this market, I will keep some dry powder available while continuing to nibble here and there.
When it is all said and done the only thing we will know for sure is that no country can test as many people as the USA. So much for all the media hand wringing.

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

Post by Wannaretireearly » Thu Mar 26, 2020 8:13 pm

GT99 wrote:
Thu Mar 26, 2020 7:57 pm
Given where the COVID-19 numbers are heading, I'm finding the market's movement the past few days very strange. Feels like too much bounce for the stimulus package, given some of that should have been priced in already (we've known for a while some sort of stimulus was coming). Still feels like there's more panic waiting to get pulled out. We may well see 20,000 new cases tomorrow in the US. A lot more hospitals are about to get pushed passed capacity, which will increase mortality rates. My best guess is that numbers over the weekend are going to be bad enough that come Monday, enough people will be spooked to cause another selloff.

That said, it seems like I'm less pessimistic than average around here. I'd be very surprised if we don't see 2300 S&P again in the next couple weeks. I wouldn't be surprised if we see 2200. I think 2100 is unlikely, but still very possible.

That's my ***GUESS***
Agree. Although I'm more pessimistic. I see a 50% decline bottoming out. S and P 1700 ish. Thats still a lot higher than 2008/9 lows
Buy Low, Sell High

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

Post by LeftCoastIV » Thu Mar 26, 2020 8:31 pm

Wannaretireearly wrote:
Thu Mar 26, 2020 8:13 pm
GT99 wrote:
Thu Mar 26, 2020 7:57 pm
Given where the COVID-19 numbers are heading, I'm finding the market's movement the past few days very strange. Feels like too much bounce for the stimulus package, given some of that should have been priced in already (we've known for a while some sort of stimulus was coming). Still feels like there's more panic waiting to get pulled out. We may well see 20,000 new cases tomorrow in the US. A lot more hospitals are about to get pushed passed capacity, which will increase mortality rates. My best guess is that numbers over the weekend are going to be bad enough that come Monday, enough people will be spooked to cause another selloff.

That said, it seems like I'm less pessimistic than average around here. I'd be very surprised if we don't see 2300 S&P again in the next couple weeks. I wouldn't be surprised if we see 2200. I think 2100 is unlikely, but still very possible.

That's my ***GUESS***
Agree. Although I'm more pessimistic. I see a 50% decline bottoming out. S and P 1700 ish. Thats still a lot higher than 2008/9 lows
That would make it about inline with the 2000 and 2007 bear markets (49% and 57% respectively). But for each of those it took 1-2+ years for the bear market to end.

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

Post by Randolph Mortimer » Thu Mar 26, 2020 8:40 pm

watchnerd wrote:
Thu Mar 26, 2020 12:37 pm
huskerfan1414 wrote:
Thu Mar 26, 2020 11:23 am
.

Did we actually hit the bottom?? WHAT THE HECK IS GOING ON :confused :shock:
Is this your first big bear?

The bear doesn't always eat you all at once.

It sometimes plays with you, making you think you can escape....lures people back into the market...then mauls them again.
Reminds me of a bear attack in a movie I saw a few years ago on Netflix called "Back Country." Holy Moly. Never went camping again after seeing that one.

As for me, right now, I'm playing dead.

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

Post by birdog » Thu Mar 26, 2020 8:49 pm

Randolph Mortimer wrote:
Thu Mar 26, 2020 8:40 pm
watchnerd wrote:
Thu Mar 26, 2020 12:37 pm
huskerfan1414 wrote:
Thu Mar 26, 2020 11:23 am
.

Did we actually hit the bottom?? WHAT THE HECK IS GOING ON :confused :shock:
Is this your first big bear?

The bear doesn't always eat you all at once.

It sometimes plays with you, making you think you can escape....lures people back into the market...then mauls them again.
Reminds me of a bear attack in a movie I saw a few years ago on Netflix called "Back Country." Holy Moly. Never went camping again after seeing that one.

As for me, right now, I'm playing dead.
This bear reminds me of The Revenant.

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

Post by Random Musings » Thu Mar 26, 2020 9:04 pm

I'm pretty confident that the market bottom is behind me. If we get to those 73-74 lows, we are in a heck of a lot of trouble.

RM
I figure the odds be fifty-fifty I just might have something to say. FZ

vipertom1970
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Re: So bottom is probably behind us....right?

Post by vipertom1970 » Thu Mar 26, 2020 9:07 pm

Market already priced in next two quarters of unemployment and negative GDP so yes we found the bottom.
Last edited by vipertom1970 on Thu Mar 26, 2020 9:24 pm, edited 1 time in total.

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

Post by fatcoffeedrinker » Thu Mar 26, 2020 9:20 pm

LeftCoastIV wrote:
Thu Mar 26, 2020 8:31 pm
Wannaretireearly wrote:
Thu Mar 26, 2020 8:13 pm
GT99 wrote:
Thu Mar 26, 2020 7:57 pm
Given where the COVID-19 numbers are heading, I'm finding the market's movement the past few days very strange. Feels like too much bounce for the stimulus package, given some of that should have been priced in already (we've known for a while some sort of stimulus was coming). Still feels like there's more panic waiting to get pulled out. We may well see 20,000 new cases tomorrow in the US. A lot more hospitals are about to get pushed passed capacity, which will increase mortality rates. My best guess is that numbers over the weekend are going to be bad enough that come Monday, enough people will be spooked to cause another selloff.

That said, it seems like I'm less pessimistic than average around here. I'd be very surprised if we don't see 2300 S&P again in the next couple weeks. I wouldn't be surprised if we see 2200. I think 2100 is unlikely, but still very possible.

That's my ***GUESS***
Agree. Although I'm more pessimistic. I see a 50% decline bottoming out. S and P 1700 ish. Thats still a lot higher than 2008/9 lows
That would make it about inline with the 2000 and 2007 bear markets (49% and 57% respectively). But for each of those it took 1-2+ years for the bear market to end.
I'll be the first to admit that I know nothing. But, it does seem like there is a lot of recency bias around here. Just because the last two bear markets had ~50% declines (ignoring December 2018) does not mean that those were typical bear markets. In fact, those were very atypical bear markets in the depth of the drawdown. 30%-40% is much more typical. We were down 34% at close on Monday. Now maybe we retest, maybe we go below. I don't know. But to expect every bear market to involve a 50%+ drawdown is not historically accurate.

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

Post by Blister » Thu Mar 26, 2020 9:22 pm

Not that it matters for a long term investor, but I would not be calling a bottom in the market until we see a flattening of the curve of new covid 19 cases. The US is still on the steep part of the exponential curve. I dont think people are taking this seriously enough with all the talk of putting people back to work by Easter. Congress will probably end up passing several packages before this is over. Just stay home and wash your hands.
Everthing works out in the end. If it doesn't then its not the end.

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

Post by Wannaretireearly » Thu Mar 26, 2020 9:42 pm

vipertom1970 wrote:
Thu Mar 26, 2020 9:07 pm
Market already priced in next two quarters of unemployment and negative GDP so yes we found the bottom.
I hope so, but what are expectations for unemployment next two quarters and what is the expected negative GDP? That's the issue...first piece of economic data gave a 4X increase then any previous unemployment weekly number. Extrapolate that to the next 2 months and unemployment could/will be 10 million or above. I dont think the market is smart enough or fast enough to have all that priced in. I wish it did, I truly do...
Buy Low, Sell High

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

Post by BC_Doc » Thu Mar 26, 2020 9:57 pm

I was around and investing during the Tech Wreck and the Great Financial Crisis. 2000-2002 brought a peak to trough drop of 49% to the S&P 500. The drop during the GFC was 56%

I wasn't around for the 1929 (to 1932) stock market crash but history says the loss was 86%.

I'm an ER doc and not an ophthalmologist, but I find myself doing the "Better, same, or worse" questioning similar to when one is fitted for an eyeglass prescription.

Does the present crisis feel better, same, or worse than 2000-2002? Worse.

2007-2009? Worse.

1929-1932? Better.... so far.

My best guess/most optimistic estimate is that the bottom will come in at 60-65% off (February 2020) market highs. The bottom is most definitely not behind us.

We are still very, very early in this public health and financial health crisis. To paraphrase Winston Churchill, this isn't even the end of the beginning. If this were baseball, we're not even in the early innings of the game. We're still off at Spring Training.

I live and work north of the border in the British Columbia Interior. I went out for a bit of a drive yesterday to suss out things in a small city of approximately 125,000 people not far from my home. The economy has absolutely cratered. Almost all businesses are closed and those few that aren't really didn't have any customers that I could see. I am in my mid-50s and have always been very attuned to political and economic life since I was a small child. I have never seen anything like this. What I am seeing in the economy is beyond bad-- it's terrible. Forget about a bottom. There is way, way more pain ahead.

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

Post by Noobvestor » Thu Mar 26, 2020 10:06 pm

BC_Doc wrote:
Thu Mar 26, 2020 9:57 pm
I live and work north of the border in the British Columbia Interior. I went out for a bit of a drive yesterday to suss out things in a small city of approximately 125,000 people not far from my home. The economy has absolutely cratered. Almost all businesses are closed and those few that aren't really didn't have any customers that I could see. I am in my mid-50s and have always been very attuned to political and economic life since I was a small child. I have never seen anything like this. What I am seeing in the economy is beyond bad-- it's terrible. Forget about a bottom. There is way, way more pain ahead.
Now assume that what you saw turns out to be temporary - like the tourist town in the off season, or shutting down to go on vacation together for a few weeks. Would that change your view at all? I'm playing Devil's advocate here, but I'm still unable to reconcile 'shutting down for a while' with '2/3 of business value wiped out around the entire world' (which would seem to align with your estimation of a 60%+ level crash).
Last edited by Noobvestor on Thu Mar 26, 2020 10:07 pm, edited 1 time in total.
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potatopancake
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Re: So bottom is probably behind us....right?

Post by potatopancake » Thu Mar 26, 2020 10:07 pm

The market has went through the shock and awe response and now we are waiting for the drip, drip, drip deterioration of unemployment, further and worsening cases/deaths, and a longer quarantine [and no, Coachella is not rescheduled for Easter Day]. We haven't priced in the the psychological pain of this crisis and the place we are going.

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

Post by potatopancake » Thu Mar 26, 2020 10:10 pm

Noobvestor wrote:
Thu Mar 26, 2020 10:06 pm
Now assume that what you saw turns out to be temporary - like the tourist town in the off season, or shutting down to go on vacation together for a few weeks. Would that change your view at all? I'm playing Devil's advocate here, but I'm still unable to reconcile 'shutting down for a while' with '2/3 of business value wiped out around the entire world' (which would seem to align with your estimation of a 60%+ level crash).
This post was perfectly timed. This is exactly why the market has yet to bottom out. There is no way, absolutely no way that we will be returning to normal in a few weeks. Italy started a national lockdown 17 days ago and their death/day has not peaked. The USA has no national lockdown. We are nowhere near the peak. And, life will not return to normal with the snap of a finger. We will re-integrate slowly. Or we will integrate partway while waiting for a vaccine. Given our understanding of covid-19 R0, 50% of population needs Abs to reach herd immunity. That means that > 150 million people get sick or get the vaccine (or some combination of the two). This is not a three week event. The market, as I said above, has not priced that hurt in. This is a recession, a marathon, and we have run the first 5k.

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

Post by Noobvestor » Thu Mar 26, 2020 10:14 pm

potatopancake wrote:
Thu Mar 26, 2020 10:10 pm
Noobvestor wrote:
Thu Mar 26, 2020 10:06 pm
Now assume that what you saw turns out to be temporary - like the tourist town in the off season, or shutting down to go on vacation together for a few weeks. Would that change your view at all? I'm playing Devil's advocate here, but I'm still unable to reconcile 'shutting down for a while' with '2/3 of business value wiped out around the entire world' (which would seem to align with your estimation of a 60%+ level crash).
This post was perfectly timed. This is exactly why the market has yet to bottom out. There is no way, absolutely no way that we will be returning to normal in a few weeks. Italy started a national lockdown 17 days ago and their death/day has not peaked. The USA has no national lockdown. We are nowhere near the peak. And, life will not return to normal with the snap of a finger. We will re-integrate slowly. Or we will integrate partway while waiting for a vaccine. Given our understanding of covid-19 R0, 50% of population needs immunity to reach herd immunity. That means that > 300 million people get sick or get the vaccine (or some combination of the two). This is not a three week event. The market, as I said above, has not priced that hurt in.
OK, replace weeks with months. Shut down non-essential business for 6 months. Let's say half the economy. Worldwide. And Corona persists, ebbs and flows. Terrible for earnings, but life goes on. I'm wondering how that translates into a permanent global loss on the scale being suggested.
"In the absence of clarity, diversification is the only logical strategy" -= Larry Swedroe

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

Post by Waiting_for_Godot » Thu Mar 26, 2020 10:22 pm

Noobvestor wrote:
Thu Mar 26, 2020 10:14 pm
potatopancake wrote:
Thu Mar 26, 2020 10:10 pm
Noobvestor wrote:
Thu Mar 26, 2020 10:06 pm
Now assume that what you saw turns out to be temporary - like the tourist town in the off season, or shutting down to go on vacation together for a few weeks. Would that change your view at all? I'm playing Devil's advocate here, but I'm still unable to reconcile 'shutting down for a while' with '2/3 of business value wiped out around the entire world' (which would seem to align with your estimation of a 60%+ level crash).
This post was perfectly timed. This is exactly why the market has yet to bottom out. There is no way, absolutely no way that we will be returning to normal in a few weeks. Italy started a national lockdown 17 days ago and their death/day has not peaked. The USA has no national lockdown. We are nowhere near the peak. And, life will not return to normal with the snap of a finger. We will re-integrate slowly. Or we will integrate partway while waiting for a vaccine. Given our understanding of covid-19 R0, 50% of population needs immunity to reach herd immunity. That means that > 300 million people get sick or get the vaccine (or some combination of the two). This is not a three week event. The market, as I said above, has not priced that hurt in.
OK, replace weeks with months. Shut down non-essential business for 6 months. Let's say half the economy. Worldwide. And Corona persists, ebbs and flows. Terrible for earnings, but life goes on. I'm wondering how that translates into a permanent global loss on the scale being suggested.
I'm not sure what you mean by permanent; most here are just guessing that we'll go lower and take longer to recover than some of the V-shaped optimists think, but that indeed life will eventually go on.

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

Post by potatopancake » Thu Mar 26, 2020 10:23 pm

Noobvestor wrote:
Thu Mar 26, 2020 10:14 pm
OK, replace weeks with months. Shut down non-essential business for 6 months. Let's say half the economy. Worldwide. And Corona persists, ebbs and flows. Terrible for earnings, but life goes on. I'm wondering how that translates into a permanent global loss on the scale being suggested.
Oh, I think the market is going to rebound nicely as the fundamentals have not changed. By Summer 2021 this will be in the rear view mirror. I'm not saying we are going to face any catastrophic changes or live in a post-apocalyptic world.

I am only saying: NO, we have not hit bottom.

FS51
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Re: So bottom is probably behind us....right?

Post by FS51 » Thu Mar 26, 2020 10:25 pm

watchnerd wrote:
Thu Mar 26, 2020 6:22 pm
WhiteMaxima wrote:
Thu Mar 26, 2020 6:17 pm
bottom was in 100 years ago. If you invested 10K in a diversified folio 100 years ago and never sell during market correction. Go figure how much the $10k investment worth today. What happend last 3 weeks is just pothole when you look back 5 years later. Stay calm, stay the course.

Are you The Highlander?
This made me laugh out loud.

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

Post by wkimdds » Thu Mar 26, 2020 10:28 pm

potatopancake wrote:
Thu Mar 26, 2020 10:23 pm
Noobvestor wrote:
Thu Mar 26, 2020 10:14 pm
OK, replace weeks with months. Shut down non-essential business for 6 months. Let's say half the economy. Worldwide. And Corona persists, ebbs and flows. Terrible for earnings, but life goes on. I'm wondering how that translates into a permanent global loss on the scale being suggested.
Oh, I think the market is going to rebound nicely as the fundamentals have not changed. By Summer 2021 this will be in the rear view mirror. I'm not saying we are going to face any catastrophic changes or live in a post-apocalyptic world.

I am only saying: NO, we have not hit bottom.


I agree. Fundamentals have not changed. In fact, got worse. As long as people are on unemployment and corona cases are going up, I don't think this uptick is a real recovery but an artificial bounce from QE.

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

Post by teelainen » Thu Mar 26, 2020 10:41 pm

RayKeynes wrote:
Thu Mar 26, 2020 11:31 am
The following is the main reason why the bottom is not yet in:

Image
There seems to be an error on this report.

March 2001 was not the peak of the market. I thought the peak was March 2000 ?

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

Post by Momus » Fri Mar 27, 2020 12:48 am

lostdog wrote:
Thu Mar 26, 2020 7:36 pm
Momus wrote:
Thu Mar 26, 2020 12:30 pm
We have about 6M people unemployed right now at 3.5 -> 8%.

https://docs.google.com/spreadsheets/d/ ... sp=sharing

It's gonna get worse before it's getting better. 10-30% unemployment is possible.

Great depression 2.0.
Doubt it. That's pretty extreme.
Already at 8%. 10% is just around the horizon, not all US cities tell their people to stay at home yet. I'd say 15% is conservative at this point. More infections, more stricter quarantine. Job loss/bankruptcy is imminent, even for big companies.

mac808
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Re: So bottom is probably behind us....right?

Post by mac808 » Fri Mar 27, 2020 12:56 am

potatopancake wrote:
Thu Mar 26, 2020 10:10 pm
Noobvestor wrote:
Thu Mar 26, 2020 10:06 pm
Now assume that what you saw turns out to be temporary - like the tourist town in the off season, or shutting down to go on vacation together for a few weeks. Would that change your view at all? I'm playing Devil's advocate here, but I'm still unable to reconcile 'shutting down for a while' with '2/3 of business value wiped out around the entire world' (which would seem to align with your estimation of a 60%+ level crash).
This post was perfectly timed. This is exactly why the market has yet to bottom out. There is no way, absolutely no way that we will be returning to normal in a few weeks. Italy started a national lockdown 17 days ago and their death/day has not peaked. The USA has no national lockdown. We are nowhere near the peak. And, life will not return to normal with the snap of a finger. We will re-integrate slowly. Or we will integrate partway while waiting for a vaccine. Given our understanding of covid-19 R0, 50% of population needs Abs to reach herd immunity. That means that > 150 million people get sick or get the vaccine (or some combination of the two). This is not a three week event. The market, as I said above, has not priced that hurt in. This is a recession, a marathon, and we have run the first 5k.
How would you contrast the current crisis to 2007-2008? In both cases, there was clearly light at the end of the tunnel, eventually.

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

Post by madbrain » Fri Mar 27, 2020 2:16 am

mac808 wrote:
Fri Mar 27, 2020 12:56 am
How would you contrast the current crisis to 2007-2008? In both cases, there was clearly light at the end of the tunnel, eventually.
Having been an investor since 1996, I feel there is much more uncertainty about this crisis than the ones that preceded. Science moves much more slowly than markets. The vaccines and/or drugs for COVID-19 could take years. My perspective as an HIV-positive person : HIV was discovered in 1981. The first treatments that did anything for it appeared in 1995, after 14 terrible years. 39 years later, there is still no cure for it, and no vaccine, although some preventive drugs now exist.

We still have much to learn about COVID-19. It's impossible for me to be anything but pessimistic in the short-term. I would be very pleasantly surprised if COVID-19 is completely behind us 2 years from now.

That said, I haven't sold any of my long-term equity holdings since the start of the crisis. I did rebalance a tiny bit last week and add on to them by 5%. I think the wild upswings are here to stay. I bought some long dated ITM puts after large market upswings, on 3/26. And if this keeps up, I will buy many more of them.

Goal33
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Re: So bottom is probably behind us....right?

Post by Goal33 » Fri Mar 27, 2020 2:28 am

madbrain wrote:
Fri Mar 27, 2020 2:16 am
mac808 wrote:
Fri Mar 27, 2020 12:56 am
How would you contrast the current crisis to 2007-2008? In both cases, there was clearly light at the end of the tunnel, eventually.
Having been an investor since 1996, I feel there is much more uncertainty about this crisis than the ones that preceded. Science moves much more slowly than markets. The vaccines and/or drugs for COVID-19 could take years. My perspective as an HIV-positive person : HIV was discovered in 1981. The first treatments that did anything for it appeared in 1995, after 14 terrible years. 39 years later, there is still no cure for it, and no vaccine, although some preventive drugs now exist.

We still have much to learn about COVID-19. It's impossible for me to be anything but pessimistic in the short-term. I would be very pleasantly surprised if COVID-19 is completely behind us 2 years from now.

That said, I haven't sold any of my long-term equity holdings since the start of the crisis. I did rebalance a tiny bit last week and add on to them by 5%. I think the wild upswings are here to stay. I bought some long dated ITM puts after large market upswings, on 3/26. And if this keeps up, I will buy many more of them.
not a doctor or a scientist but I think the major difference is with HIV you can't naturally recover from that, with COVID-19, some high % are better in a few weeks. I believe Covid-19 would run it's course naturally or would have to be prevented with a vaccine.
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phantom0308
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Re: So bottom is probably behind us....right?

Post by phantom0308 » Fri Mar 27, 2020 3:01 am

It’s impossible to know and depends on how long this lasts.

GM just announced it was deferring 20% of salaries until the end of the year to maintain cash flow. If it lasts more than 6 months then big companies outside of the obviously affected industries getting assistance are going to start getting stressed or going out of business. Bankruptcies are nonlinear and a string of them could really impact the overall health of the economy.

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

Post by madbrain » Fri Mar 27, 2020 3:07 am

Goal33 wrote:
Fri Mar 27, 2020 2:28 am
not a doctor or a scientist but I think the major difference is with HIV you can't naturally recover from that, with COVID-19, some high % are better in a few weeks. I believe Covid-19 would run it's course naturally or would have to be prevented with a vaccine.
Not a doctor or scientists here either, just a patient who has read a lot about his condition in the last 14 years. You are right that COVID-19 appears to run its course in most people. I assume that means it stops replicating, and the viral load goes to 0. I don't think it's known yet if those patients develop immunity to it, or if they can be reinfected afterwards.

As anecdote, one person, whom I met years ago, appears to have cleared HIV naturally. Genetics play a huge role in virus progression.
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ge1
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Re: So bottom is probably behind us....right?

Post by ge1 » Fri Mar 27, 2020 5:29 am

potatopancake wrote:
Thu Mar 26, 2020 10:10 pm
Noobvestor wrote:
Thu Mar 26, 2020 10:06 pm
Now assume that what you saw turns out to be temporary - like the tourist town in the off season, or shutting down to go on vacation together for a few weeks. Would that change your view at all? I'm playing Devil's advocate here, but I'm still unable to reconcile 'shutting down for a while' with '2/3 of business value wiped out around the entire world' (which would seem to align with your estimation of a 60%+ level crash).
This post was perfectly timed. This is exactly why the market has yet to bottom out. There is no way, absolutely no way that we will be returning to normal in a few weeks. Italy started a national lockdown 17 days ago and their death/day has not peaked. The USA has no national lockdown. We are nowhere near the peak. And, life will not return to normal with the snap of a finger. We will re-integrate slowly. Or we will integrate partway while waiting for a vaccine. Given our understanding of covid-19 R0, 50% of population needs Abs to reach herd immunity. That means that > 150 million people get sick or get the vaccine (or some combination of the two). This is not a three week event. The market, as I said above, has not priced that hurt in. This is a recession, a marathon, and we have run the first 5k.
This. Could not agree more.

sd323232
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Re: So bottom is probably behind us....right?

Post by sd323232 » Fri Mar 27, 2020 5:37 am

ge1 wrote:
Fri Mar 27, 2020 5:29 am
potatopancake wrote:
Thu Mar 26, 2020 10:10 pm
Noobvestor wrote:
Thu Mar 26, 2020 10:06 pm
Now assume that what you saw turns out to be temporary - like the tourist town in the off season, or shutting down to go on vacation together for a few weeks. Would that change your view at all? I'm playing Devil's advocate here, but I'm still unable to reconcile 'shutting down for a while' with '2/3 of business value wiped out around the entire world' (which would seem to align with your estimation of a 60%+ level crash).
This post was perfectly timed. This is exactly why the market has yet to bottom out. There is no way, absolutely no way that we will be returning to normal in a few weeks. Italy started a national lockdown 17 days ago and their death/day has not peaked. The USA has no national lockdown. We are nowhere near the peak. And, life will not return to normal with the snap of a finger. We will re-integrate slowly. Or we will integrate partway while waiting for a vaccine. Given our understanding of covid-19 R0, 50% of population needs Abs to reach herd immunity. That means that > 150 million people get sick or get the vaccine (or some combination of the two). This is not a three week event. The market, as I said above, has not priced that hurt in. This is a recession, a marathon, and we have run the first 5k.
This. Could not agree more.
I agree also guys, not bottom yet, when coronavirus infection is not contained, unemployment is at all time high and will grow, business still shut down, noone flying, and china just closed their border for who knows how long, how can business survive in todays conditions? All business will be hit, some will not recover. It is negative all around, we need contain virus asap, first step to recovery.
Last edited by sd323232 on Fri Mar 27, 2020 5:48 am, edited 1 time in total.

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

Post by RayKeynes » Fri Mar 27, 2020 5:39 am

Yesterday was a very nice short opportunity :sharebeer

Shorted with 10% of portfolio value with SPXU @ 2'630
Sold 20% of portfolio value in VTI @ 2'630

Let's get into the 2nd stage of the bear :sharebeer

keelerjr12
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Re: So bottom is probably behind us....right?

Post by keelerjr12 » Fri Mar 27, 2020 6:17 am

Noobvestor wrote:
Thu Mar 26, 2020 10:14 pm
potatopancake wrote:
Thu Mar 26, 2020 10:10 pm
Noobvestor wrote:
Thu Mar 26, 2020 10:06 pm
Now assume that what you saw turns out to be temporary - like the tourist town in the off season, or shutting down to go on vacation together for a few weeks. Would that change your view at all? I'm playing Devil's advocate here, but I'm still unable to reconcile 'shutting down for a while' with '2/3 of business value wiped out around the entire world' (which would seem to align with your estimation of a 60%+ level crash).
This post was perfectly timed. This is exactly why the market has yet to bottom out. There is no way, absolutely no way that we will be returning to normal in a few weeks. Italy started a national lockdown 17 days ago and their death/day has not peaked. The USA has no national lockdown. We are nowhere near the peak. And, life will not return to normal with the snap of a finger. We will re-integrate slowly. Or we will integrate partway while waiting for a vaccine. Given our understanding of covid-19 R0, 50% of population needs immunity to reach herd immunity. That means that > 300 million people get sick or get the vaccine (or some combination of the two). This is not a three week event. The market, as I said above, has not priced that hurt in.
OK, replace weeks with months. Shut down non-essential business for 6 months. Let's say half the economy. Worldwide. And Corona persists, ebbs and flows. Terrible for earnings, but life goes on. I'm wondering how that translates into a permanent global loss on the scale being suggested.
noobinvestor,

I know you’re playing devil’s advocate, but I feel that you may be underestimating this. Heres a response from my mom who received this from my cousin who is a nurse in MI.

“XXX said they are between 20-80 yrs. They now have 2 floors instead of 1, and are doubling people to a room, they are also putting 2 people in a room to share the same ventilator. They have 150 employees out sick with it at his hospital, he's sure he's going to get it. He's staying away from XXXXX since her immune system is compromised. He said it's sad, people are dying alone without family. One couple, recently married both died. He also said they are using garbage bags as gowns and this weekend will have to make choices as to who lives and who dies. 😪 I don't think most are getting that sick, it's just those who are, there aren't enough ventilators for them.”

I can’t say if we already hit the bottom, but with 1/2 of my cousins as nurses all sending responses like that, I think it’s safe to say that we’re hardly through this.

Contrary to that, north TX I don’t think is taking it seriously enough. Sure, Dallas and Fort Worth are, but where I’m at, no. And my town is full of old conservative people that don’t really believe much in science.

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

Post by birdog » Fri Mar 27, 2020 6:36 am

RayKeynes wrote:
Fri Mar 27, 2020 5:39 am
Yesterday was a very nice short opportunity :sharebeer

Shorted with 10% of portfolio value with SPXU @ 2'630
Sold 20% of portfolio value in VTI @ 2'630

Let's get into the 2nd stage of the bear :sharebeer
Man I sure hope you get burned!!!

keelerjr12
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Re: So bottom is probably behind us....right?

Post by keelerjr12 » Fri Mar 27, 2020 7:01 am

birdog wrote:
Fri Mar 27, 2020 6:36 am
RayKeynes wrote:
Fri Mar 27, 2020 5:39 am
Yesterday was a very nice short opportunity :sharebeer

Shorted with 10% of portfolio value with SPXU @ 2'630
Sold 20% of portfolio value in VTI @ 2'630

Let's get into the 2nd stage of the bear :sharebeer
Man I sure hope you get burned!!!
Are you actually a fighter pilot or just pretend to be one with your picture?

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

Post by RayKeynes » Fri Mar 27, 2020 7:02 am

birdog wrote:
Fri Mar 27, 2020 6:36 am
RayKeynes wrote:
Fri Mar 27, 2020 5:39 am
Yesterday was a very nice short opportunity :sharebeer

Shorted with 10% of portfolio value with SPXU @ 2'630
Sold 20% of portfolio value in VTI @ 2'630

Let's get into the 2nd stage of the bear :sharebeer
Man I sure hope you get burned!!!
How can I get burned? I do not understand you? I am still long with 30% of my portfolio. I am just heding it. :confused :confused

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

Post by birdog » Fri Mar 27, 2020 7:05 am

I hope your bearish bets turns out very poorly. What’s not to understand about that?

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

Post by RayKeynes » Fri Mar 27, 2020 7:09 am

birdog wrote:
Fri Mar 27, 2020 7:05 am
I hope your bearish bets turns out very poorly. What’s not to understand about that?
It will not, as this is a bull trap. Whats not to understand about that? :sharebeer

And even if it does turn out to be poorly and SP500 runs to 2700 - I still make more gains than losses as I did not hedge 100% of value. :sharebeer

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

Post by birdog » Fri Mar 27, 2020 7:15 am

RayKeynes wrote:
Fri Mar 27, 2020 7:09 am
birdog wrote:
Fri Mar 27, 2020 7:05 am
I hope your bearish bets turns out very poorly. What’s not to understand about that?
It will not, as this is a bull trap. Whats not to understand about that? :sharebeer

And even if it does turn out to be poorly and SP500 runs to 2700 - I still make more gains than losses as I did not hedge 100% of value. :sharebeer
Where did I say that I didn't understand that this could be a bull trap? I merely said that I hope your bearish bets turn out very poorly. I wish no harm on the bullish part of your portfolio, just the bearish part.

Hogan773
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Re: So bottom is probably behind us....right?

Post by Hogan773 » Fri Mar 27, 2020 7:44 am

Noobvestor wrote:
Thu Mar 26, 2020 10:14 pm
potatopancake wrote:
Thu Mar 26, 2020 10:10 pm
Noobvestor wrote:
Thu Mar 26, 2020 10:06 pm
Now assume that what you saw turns out to be temporary - like the tourist town in the off season, or shutting down to go on vacation together for a few weeks. Would that change your view at all? I'm playing Devil's advocate here, but I'm still unable to reconcile 'shutting down for a while' with '2/3 of business value wiped out around the entire world' (which would seem to align with your estimation of a 60%+ level crash).
This post was perfectly timed. This is exactly why the market has yet to bottom out. There is no way, absolutely no way that we will be returning to normal in a few weeks. Italy started a national lockdown 17 days ago and their death/day has not peaked. The USA has no national lockdown. We are nowhere near the peak. And, life will not return to normal with the snap of a finger. We will re-integrate slowly. Or we will integrate partway while waiting for a vaccine. Given our understanding of covid-19 R0, 50% of population needs immunity to reach herd immunity. That means that > 300 million people get sick or get the vaccine (or some combination of the two). This is not a three week event. The market, as I said above, has not priced that hurt in.
OK, replace weeks with months. Shut down non-essential business for 6 months. Let's say half the economy. Worldwide. And Corona persists, ebbs and flows. Terrible for earnings, but life goes on. I'm wondering how that translates into a permanent global loss on the scale being suggested.
Why "permanent"?

If it were permanent then I would think the market losses would be even worse than a down 50pct scenario

I am also in the camp that it is hard to believe that a 20pct down is all that is needed for this shock. You could use the same analogy for prior shocks...it was only some bad mortgage loans and credit default swaps and once we get through that quickly then no reason we won't go higher

Hogan773
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Re: So bottom is probably behind us....right?

Post by Hogan773 » Fri Mar 27, 2020 8:09 am

Any way I can hedge downside at this point if I can't buy options on ETFs? I guess can look at inverse ETFs but I got burned awhile back on buying inverse bond ETF

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

Post by Peculiar_Investor » Fri Mar 27, 2020 8:10 am

It has probably already been said somewhere back in this topic, but I think it is worth saying again.

From an investing perspective why does it matter when a bottom or top occurs. Does anyone have an investment plan or investment policy statement (IPS) that dictates actions or even possible actions when a market event (top, bottom, crash, correction, bear market, bull market, etc.) occurs?

If so, why and what action do you take or consider?

If not, then just stick to your plan and stay the course.

And of course, stay safe!
Normal people… believe that if it ain’t broke, don’t fix it. Engineers believe that if it ain’t broke, it doesn’t have enough features yet. – Scott Adams

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

Post by mptfan » Fri Mar 27, 2020 8:28 am

Peculiar_Investor wrote:
Fri Mar 27, 2020 8:10 am
From an investing perspective why does it matter when a bottom or top occurs.
It doesn't, but it's fun to guess and see if the guesses turn out to be right or wrong.

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

Post by Wannaretireearly » Fri Mar 27, 2020 9:34 am

Hogan773 wrote:
Fri Mar 27, 2020 8:09 am
Any way I can hedge downside at this point if I can't buy options on ETFs? I guess can look at inverse ETFs but I got burned awhile back on buying inverse bond ETF
Buy conservative TRD fund on the way up. Like yday, lock in some gains. Switch to more aggressive TRD on down days to buy low. Never betting the house, but seems a good short term strategy to feel like you can benefit either on the upside or downside. Easy to execute too (one fund --> one fund)
Buy Low, Sell High

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

Post by watchnerd » Fri Mar 27, 2020 9:41 am

Oh no my bottom is in front of me today.
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