SSOTT

[GrussGott]

soooo.... Italy is testing for COVID 165x the US rate:

[GrussGott]

I bet Trump's speech lifted the spirits of S&P 500 traders! Let's look at his win!

[Captain Blood]

Two observations about current events:

Effectively, trump banned Lups from the United States last night.

How smart are we? People are hoarding toilet paper.

[Lups]

Originally Posted by Captain Blood

Two observations about current events:

Effectively, trump banned Lups from the United States last night.

How smart are we? People are hoarding toilet paper.

Well, he got something right finally then!

I don't understand what's going on. I can't believe there still are americans running around screaming hoax.

[GrussGott]

Originally Posted by Lups

Well, he got something right finally then!

I don't understand what's going on. I can't believe there still are americans running around screaming hoax.

about 60% of Americans are doing some form of that.

Nobody will watch this, but every American should - it's what it looks like when we have competent reps holding the exec branch accountable and getting results (seriously - it's only 5 min, watch until the end, so badass):

[Arcades]

Originally Posted by GrussGott

I bet Trump's speech lifted the spirits of S&P 500 traders! Let's look at his win!

The only thing dumb American people know about is their wallets.

I hate being so vengeful but I just love seeing what is going on. Personally though, I am curious on how this will impact the global market in the long term. Considering my family was planning on visiting Taiwan again this year, we might have to put that on hold now.

Plane tickets might be cheap though!

[minn19]

Originally Posted by Lups

Well, he got something right finally then!

I don't understand what's going on. I can't believe there still are americans running around screaming hoax.

For some fun reading, check out this thread.

https://f80.bimmerpost.com/forums/sh....php?t=1698718

[minn19]

GrussGott, I'd say get in on the thread that I linked for Lups, but I don't want you to get banned.

[GrussGott]

Originally Posted by Arcades

The only thing dumb American people know about is their wallets.

I hate being so vengeful but I just love seeing what is going on. Personally though, I am curious on how this will impact the global market in the long term.

The long term prospects will come down to one thing: corporate debt.

In the 00s, people took out home loans for homes they couldn't afford, but were able to keep them because they'd refinance due to loose loan requirements driven by investors piling money into mortgages. The resulting defaults, combined with investor insurance against defaults, took down the economy.

The same thing is going on with corporate debt: ever lower fed rates means companies who don't earn enough to pay off their debt can simply refinance the new debt and old debt and continue operating - they're called "zombie companies". They can also sell high risk bonds, that pay a high interest rate, and then pay off the bonds with new refinanced loans.

Over the last 10 years, this type of zombie debt has exploded:



The yellow and grey bars are investors pouring into higher risk corporate debt in a search for yield ("risk-on"). At the same time they buy insurance ("swaps") against losses from people willing to sell it.

Here's the problem: those loans DO have requirements and if the company's credit rating is downgraded, the banks can trigger margin calls and ask for their money - that will trigger a credit crisis and possibly set off a cascade as investors also get downgraded and get their own margin calls and so on. This includes the swaps market who suddenly gets pounded to pay out, which they can't afford, and they go out of business.

As people flee to safety ("risk-off"), rates on safe US treasuries plummet while rates on zombie corporate debt grows - by tracking these credit spreads, the rate of change between the two, you can get a sense of the danger.

Here's what those spreads look like this week:



So, assuming continued flailing by this administration to do anything remotely competent, and a growing outbreak ... yeah, the next 6 months at least are going to be bad ...

As they say, the time to buy is when you absolutely don't want to.

[Captain Blood]

The associated press doesn't have much confidence in trumps team.

https://apnews.com/5878d878b1c1b5c3274c529ed2bc38bb

[minn19]

Originally Posted by Captain Blood

The associated press doesn't have much confidence in trumps team.

https://apnews.com/5878d878b1c1b5c3274c529ed2bc38bb

And just think a little over a month ago, Trump was giving fucking Rush Limbaugh the medal of freedom at the SOTU/gloating about still being President. Meanwhile CV got out of China/heading everywhere, I’m sure Trump and his administration were completely focused on preparing for it.

Point being, no wonder nobody except for the hardcore supporters have any confidence in anything he does. Economically he still hasn’t responded to the Putin/Saudi attack on US oil except to say cheap gas prices..........MAGA/US first indeed.

[Arcades]

Originally Posted by minn19

And just think a little over a month ago, Trump was giving fucking Rush Limbaugh the medal of freedom at the SOTU/gloating about still being President. Meanwhile CV got out of China/heading everywhere, I’m sure Trump and his administration were completely focused on preparing for it.

Point being, no wonder nobody except for the hardcore supporters have any confidence in anything he does. Economically he still hasn’t responded to the Putin/Saudi attack on US oil except to say cheap gas prices..........MAGA/US first indeed.

If nothing else, Trump is consistent in one thing, covering his own ass. Every decision he has made until this point has been the same, trying to save himself. As I told others on Twitter though, history will always determine what type of person he is and we all already know what that will be when his presidential run is over. As with most people who has no experience in economics (me included) whenever someone has no clue on what to do, they just do two things, 1) Cut Taxes cuz... derp, 2) Blame someone else.

GrussGott Do you think right now is actually the best time to invest in stocks or wait a bit longer? I been wanting to invest a little into Apple before the new iPhone releases.

[Captain Blood]

I jinxed it! On the way to watch my kids varsity baseball game, I was thinking, at least I have some sports to watch.

Their games are canceled until further notice after tonight.

[Lups]

Originally Posted by minn19

And just think a little over a month ago, Trump was giving fucking Rush Limbaugh the medal of freedom at the SOTU/gloating about still being President. Meanwhile CV got out of China/heading everywhere, I’m sure Trump and his administration were completely focused on preparing for it.

Point being, no wonder nobody except for the hardcore supporters have any confidence in anything he does. Economically he still hasn’t responded to the Putin/Saudi attack on US oil except to say cheap gas prices..........MAGA/US first indeed.

This all so much my tail bone hurts for jumping up and down for reading it.

In january I realized I was too busy to react to the markets as fast as needed while under a pandemic looming around. I cashed out. No shorting, no nothing, I've been just too busy with my apartment fixing hobby and all.

Now, here we all just show indexes and big shit but has anyone checked on boeing? Yeah. That's the other company of seattle.

I'm 85% off from the market. Been since january. I got totally lucky and it makes me feel so fucking great since the greatest family we knew in Seattle have been hiding in their home for 3 weeks now since the hubby is a teacher with a kidney transplant, their younger kid has asthma and the mother and the girl are terrified for the two other.

The biologist mom thought she was going insane for overreacting. She actually ran the info that was released from china way, way, way back.

I didn't mind one it shorting banks when brexit was coming along. Though I knew people there, I thought tha I could be the one who was wrong. Also, it took years to us to get on with it.

This week tho... so brexit happened a month ago, got finalized. Now a few years later we have a pandemic in our hands and nobody talks these days.

By next week, we are on obama leaving office on dow. It won't even be over the top reaction from the markets. This is what happens when the usa and europe has no real ties.

I also want to say that Merkel told her people that 2/3 will be infected there and they all need to work on making it a slow, steady curb. That's the only world leader I've seen saying how it goes.

Anyhow, how's your 401k doing today?

[Captain Blood]

403(b), actually. And my kids college fund is tied to the market.

[Lups]

Originally Posted by Captain Blood

403(b), actually. And my kids college fund is tied to the market.

How is that going?

[Captain Blood]

Originally Posted by Lups

How is that going?

Not gonna look. But the retirement account got hammered in 2008, came back very nicely.

[GrussGott]

Originally Posted by Arcades

GrussGott Do you think right now is actually the best time to invest in stocks or wait a bit longer?

Short answer: no, definitely wait.

TLDR:
First, if you haven't, you have to make a conscious decision: are you a trader or an investor? The difference is, an investor's top priority is to generate the highest long-term passive income with the least risk; a trader's top priority is to generate the highest short-term passive income, even if it means taking high risk.

If you're an investor, then put your money into a Vanguard index fund (see Bogleheads for recommendations); set and forget it for at least 20 years. Boring, amiright?

If you're a trader then ... here are my thoughts on Apple:

* Good "technicals" (price, trends), but not as envious of a balance sheet as, say, Google right now (which might have the best balance sheet on the planet)

* Arguably, NOT a tech company, rather a consumer products company - good because their consumer and customer are the same person; not good because their core product is long in the tooth, has a long supply chain, and is susceptible to a HNT (hot new thing)

* Either way, software innovation is key and they've not shown an ability to do that (see Elon's email tweet)

Ok, so buy now or wait?

Well, yesterday we had trouble in credit markets, today it spread frighteningly to the treasury market (the safe haven!) - the move was bad enough for the NY Fed to announce a huge increase in repo ... and so the speed of these problems asks a question: are we in danger of a degenerative feedback loop?

Right now, the fear of an unknown spending drawdown in our economy is disrupting the markets - that's not good, but it's manageable. If the disrupted markets start affecting the economy, however, then we have big problems because, in that feedback loop scenario, policy won't be very effective at containment and we'll have the so-called disorderly descent to market bottom (which will be terrifying for many).

So given we just don't know if Trump's continued mismanagement will result in a disorderly decent, I'd say definitely wait.

That said, that may not happen, especially if we see huge resources being pumped into the medical community, giving the policy makers some room to focus on vulnerable parts of the economy. If and when we see that start to happen, you'll see a fast rebound.

TMI? HTH!

[UncleWede]

Originally Posted by Captain Blood

I jinxed it! On the way to watch my kids varsity baseball game, I was thinking, at least I have some sports to watch.

Their games are canceled until further notice after tonight.

I forwarded the flyer that my son's college team would be playing the Dodgers academy this weekend

I kept holding onto hope, even though I'm in Vegas

Cancelled

[Lups]

Originally Posted by UncleWede

I forwarded the flyer that my son's college team would be playing the Dodgers academy this weekend

I kept holding onto hope, even though I'm in Vegas

Cancelled

Our school board is having a meeting today. Fuck my life if I'll be in charge of teaching Finnish grammar for a month.

We have had zero deaths here but they're now serious about flattening the curb while they still can. I'm actually pretty glad they're taking this this seriously, I finally have a reason to avoid everyone.

[Lups]

Originally Posted by minn19

For some fun reading, check out this thread.

https://f80.bimmerpost.com/forums/sh....php?t=1698718

I got to page 34 or so before I stopped. You guys sure want to crash the whole economy, eh?

Where the fuck is the key to my bunker...

[GrussGott]

Originally Posted by UncleWede

I forwarded the flyer that my son's college team would be playing the Dodgers academy this weekend

I kept holding onto hope, even though I'm in Vegas

Cancelled

This just in:

also #PacificStatesofAmerica - apparently CA and WA are going to get OR, CO, and HI, and start a new gig.