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At this rate there will be Over 20 million unemployed by summer. I dont have any answers, but the 08 crash will have nothing on what's been happening these past weeks and what's to come.
My industry, (live events of various kinds) basically dried up in a week.
Millions of dollars in projects, just evaporated overnight.
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Listen. Blue Horseshoe loves Bluestar Airlines. Got it?
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I unloaded a bunch of stocks last year to buy a commercial property, and a couple investment cars. Letting my broker (cousin) "play" with the rest. My 401(k)s are pretty conservative, so we'll see.
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Commercial property will take a hit unless you have enough equity to refinance at these historically low rates or you have tenants like the US Government or an industry that is immune from a 30% unemployment rate. I agree with you on 401k or in my case IRA. I am 70% in US government bonds AA or better short term paper and a smattering of preferred stocks of non nuclear utilities and life insurance companies and the most of the rest in T and DIS. I have about 50K in DOG and some remaining QQQ and SPY puts that I bought long before the virus. I had a huge profit in SPY puts that I had to sell because they expired a couple weeks ago. PUT premiums are so high now I dare not touch them. The ones I have left are in the money but they run until after the election which I was betting that the orang was either going to cancel or dispute. By the way when that happens...our border is CLOSED. Yanks need not apply for entry.
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No one wants to go to Canada anyway.
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I bought the commercial property last year (with a partner), so obviously not much equity yet, but the value has already increased. The property is for my business/hobby, so I (we) am the tenant as well.
We were kicked out of two previous leased properties over the span of five years, and got tired of having to move and setup the shop again. Decided to buy, especially with the low rates as you mentioned, and have always been a fan of diverse investments. Plan on keeping the property for 10 years or so, so hopefully it becomes a nice retirement bonus, but in the meantime, will not need to move again.
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I just spoke with a friend who’s a stockbroker who said that week’s 14% rise was bizarre. It doesn’t make sense that the market would rise after the 16 million unemployed figure was announced. He thinks the government is propping up the market, but that the market will turn down again and may come close to testing the March lows.
Of course, who knows what may happen, but I think the market cannot do well in the near term because the worst of the pandemic is yet to come.
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IMO there's no way this ends quickly or well for the market. The quadruple whammy of COVID, climate, debt and oil will have long lasting negative effects on the market. Earning will take a massive hit this year from the pandemic. It's not certain but in my opinion quite possible that earnings for a sizable portion of the market (hence stock prices) will drop more than 50%. 50% impact on earnings would be optimistic in many cases as supply chains seize from waves of temporary and permanent closures and political action against China. My multinational will go from hero to zero in earnings and we aren't alone.
Increasing climate action and the drastic drop in demand for the foreseeable future means the oil players realize they will end up having to leave a lot more of it in the ground (and take a hit on assets once recognized) and there'll be a rush to sell cheap for decades.
I firmly believe the market was in bubble territory already fueled by unsustainable stock buybacks, mountains of debt (government and corporate at historically high levels) and unrealistic P/E ratio's (is a company really worth 20x if it's not growing fast?).
I hope I'm wrong but I think it's gonna be a new world post COVID. Higher taxes, higher prices, less globalization, lower growth & more socialization and unrest are inevitable. The era of constant economic growth and improvement in living standards is over, the earth can't take it and we are going to have to start paying the tab on the good times from the last 50 years......
Nick
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Stockbrokers are either salesmen or asset gatherers, they don't know shit about the market.
Bear market rallies are more violent and unexpected than bull market rallies.
The market does all that it can to cause the maximum amount of pain to all participants
Good luck
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All of that shit is so automated that you have these esoteric algorithms trying to balance out market selloffs in ways that just don't make any sense anymore. Just wake up the next day and see if the little arrows are red or green or pointing up or down, whatever floats your boat!
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Copy pasted from another blog?
Kudos
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Hey GoBallsDeep, shockingly, I agree with you...stockbrokers are typically just salesmen and are full of shit, but my friend knows I’d never invest with him so he’s not selling me anything.
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If you agree then I must be wrong, lol
I get he's not selling you, but he still has a 99% chance of not really knowing shit about the market.
Ask him if he's making money in his personal account, lol
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If you want a safe bet go with the S&P index. It is a lot harder to take the whole economy but apparently it can be done. Here’s a link for you for your viewing pleasure. Do not try to use the info you will get eaten alive
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| There are 14 comments on this blog. |
