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The 2020 Stock Market Crash Thread
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joost Offline
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Post: #151
RE: The 2020 Stock Market Crash Thread
^^

Same here. I just keep buying the ones I think are reasonably priced. My high yield and energy stocks are getting hammered but overall, I'm not concerned. I just wished I didn't jumped so fast.

How long the COVID-19 will last? Few months? Even if it kills hundreds of thousands, how much companies would suffer? A bad quarter before returning to normal?


Markets could continue to go down but if you have liquidity to continue to buy (slowly) during the dips... And take into account that politicians and the elite own shares of companies so they don't want the market (their own money) to tank. They might use the tax-payer money (again) to prop the market. You might use options (SPY puts) to protect your portfolio in case the market continues to go down.
(This post was last modified: 03-14-2020 01:51 PM by joost.)
03-14-2020 01:40 PM
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Foolsgo1d Offline
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Post: #152
RE: The 2020 Stock Market Crash Thread
You know the stuff that appears to be going cheap is in fact normal or over priced right? Also, the bottom has not been reached so you're buying into a level which can and will drop further. Hope you're considering holding those stocks for a while and hope those companies dont go bust if the corporate debt bubble pops and bailouts dont help.
(This post was last modified: 03-14-2020 05:43 PM by Foolsgo1d.)
03-14-2020 05:43 PM
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Tail Gunner Offline
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Post: #153
RE: The 2020 Stock Market Crash Thread
A video interview of Hari Krishnan, an expert on hedging and author of "The Second Leg Down," which offers ways to profit after a market decline.

https://www.amazon.com/Second-Leg-Down-S...B06X1BWGFK




(This post was last modified: 03-15-2020 11:06 AM by Tail Gunner.)
03-15-2020 11:04 AM
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Emancipator Offline
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Post: #154
RE: The 2020 Stock Market Crash Thread
Speaking of Buffet

He has quite the warchest to start scooping up assets, any speculation?

Mother Nature is a bitch & Father Time has an undefeated record
"If you watch cinderella backwards, its about a woman who learns her place." --Kbell

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03-15-2020 11:23 AM
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Tail Gunner Offline
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Post: #155
RE: The 2020 Stock Market Crash Thread
(03-13-2020 04:30 AM)Leonard D Neubache Wrote:  I'm not an expert on how this stuff works so forgive me if this line of thinking is errant.

1.5 trillion dollars is roughly $4,587 per American citizen or $18,348‬ per family of four.

Currently this unimaginable sum of money is going to prop up the interests of the richest 10% of Americans. In rough numbers this is like handing a debt of $4,587 to each man, woman and child and writing a cheque to the richest 10% of Americans right now for $45,871.

If you wanted to break down the numbers further then you'd probably end up writing cheques to the top 1% for 400k and the 9% below them would get perhaps 20k, but literally everyone else loses by a flat 4.5k.

Am I wrong on this?

I get that there are broader ramifications for a market crash that affect the poor as well as the rich. I'm just wondering to what extent the poor are now subsidizing the enormous wealth of the top 10% or 1%.

Yes, this line of thinking is quite errant (but I give you credit for admitting that you are not an expert and asking for input). This is a complex area and there are multiple ways to explain it. Probably the briefest way is using simple mathematics.

The measure of the money actually out in the real world interacting with people and businesses is called M2. This is completely separate from the money supply that the Fed lends to banks. The money the Fed provides to banks merely exists as digital zeros and ones on computer servers, so it does not have much impact on the general economy. During a financial crisis, banks require more liquidity because of the fractional banking system. In the U.S., the amount of M2 grows slowly each year and is presently in the neighborhood of $15 billion.

https://www.ceicdata.com/en/indicator/un...-supply-m2


So, what would happen if the Fed (or USG) released $1.5 trillion into the general economy as M2? That is 100 times the current amount of M2! We are talking hyperinflation -- and Zimbabwe and Weimar Germany type financial conditions. You can delve further into the matter by researching why Quantitative Easing did not cause inflation during the 2008 financial crisis.

https://www.roughlyexplained.com/2018/02...inflation/

Now, I am not saying that the bankers are entitled to this money either (that is the topic of another conversation), but the answer to curing socialism is never more socialism. We must strip the bankers and the ilk of their power, not provide bread and circuses (free money) to placate the masses while the bankers pilfer the nation unabated. Sending free money to everyone? You may as well give everyone a free monthly supply of opiates.
(This post was last modified: 03-15-2020 11:32 AM by Tail Gunner.)
03-15-2020 11:27 AM
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gework Offline
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Post: #156
RE: The 2020 Stock Market Crash Thread
M2 is about $15 trillion.
Money velocity is about: 1.4.
Equals ~21 trillion dollar economy.
Maybe 10% of this $1.5 trillion will flow into M2, or a 1% increase.

The reckoning for the dollar is when people don't want to hold that $15 trillion or the ~$7 trillion held by central banks as reserves are dumped.

Quote:People in darkness do not want to come to the light lest they are exposed.
03-15-2020 12:36 PM
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Tail Gunner Offline
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Post: #157
RE: The 2020 Stock Market Crash Thread
(03-15-2020 12:36 PM)gework Wrote:  M2 is about $15 trillion.
Money velocity is about: 1.4.
Equals ~21 trillion dollar economy.
Maybe 10% of this $1.5 trillion will flow into M2, or a 1% increase.

The reckoning for the dollar is when people don't want to hold that $15 trillion or the ~$7 trillion held by central banks as reserves are dumped.

I stand corrected. All the charts that I examined were in billions of dollars, like this one:

https://fred.stlouisfed.org/series/M2

So, by listing 16,000 this means 16,000 billions -- or 16 trillion. Like I said, they seem to purposely make this stuff complex for no reason. If you want to cite money in the trillions, why not list the chart in trillions?

My apologies. Blush

At any rate, the question is what would happen if $1.5 trillion was pumped into a $15 trillion M2 supply, by simply sending government checks to all citizens? That is a 10% increase in the everyday money supply. It would likely raise prices and cause high inflation.

_______________

BTW: The Gold to silver ratio topped 100!

https://www.kitco.com/commentaries/2020-...s-100.html
(This post was last modified: 03-15-2020 01:08 PM by Tail Gunner.)
03-15-2020 12:59 PM
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oilbreh Offline
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Post: #158
RE: The 2020 Stock Market Crash Thread



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03-15-2020 04:19 PM
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MKE-Ed Offline
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Post: #159
RE: The 2020 Stock Market Crash Thread
Looking at the current state of affairs with the corona virus, it seems like there is a real possibility that at some point, state governors and or the President might order a mandatory quarantine of the population with the exception of essential personnel such as medical staff, law enforcement and fire services personnel along with pharmacies and grocery store employees.

If this happens, then how will this impact the banking sector if bank personnel can’t work and if ATM machines can’t be restocked and financial networks can’t even be maintained to operate. This becomes a real possibility if things continue to deteriorate. Does anyone have any thoughts about how to best ride this out? I, for one, plan on withdrawing some cash and set it aside in case these issues do come to pass.
03-15-2020 06:19 PM
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Tail Gunner Offline
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Post: #160
RE: The 2020 Stock Market Crash Thread
(03-15-2020 06:19 PM)MKE-Ed Wrote:  Looking at the current state of affairs with the corona virus, it seems like there is a real possibility that at some point, state governors and or the President might order a mandatory quarantine of the population with the exception of essential personnel such as medical staff, law enforcement and fire services personnel along with pharmacies and grocery store employees.

If this happens, then how will this impact the banking sector if bank personnel can’t work and if ATM machines can’t be restocked and financial networks can’t even be maintained to operate. This becomes a real possibility if things continue to deteriorate. Does anyone have any thoughts about how to best ride this out? I, for one, plan on withdrawing some cash and set it aside in case these issues do come to pass.

I am picking up cash tomorrow in small denominations, probably in twenty dollar bills. I meant to do it last week.
03-15-2020 06:24 PM
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Foolsgo1d Offline
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Post: #161
RE: The 2020 Stock Market Crash Thread
FED fund rate is now 0%. 700+ billion dollars pumped into the market today. You guys buying stocks I sure hope those are long for you and dont become worthless when those companies default on their loans and become junk bond status.

1.5 trillion last friday - regulations prevented a large uptake of it and now 700 billion today.

I've seen some talk of suspending the markets to let it cool off, like 9/11. That doesn't instill confidence whatsoever.
03-15-2020 06:35 PM
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Athanasius Offline
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Post: #162
RE: The 2020 Stock Market Crash Thread
I'm not a big fan of bonds. They pay little unless you want to go into junk territory and, like cash, they will get killed in a highly inflationary scenario and possibly wiped out in a hyperinflation. I'm amazed the Fed has been able to hold it off as long as they have. Shadowstats has even the current inflation rate at about 6%.

I'd rather take my chances with stocks w/a hefty amount of hard assets.
03-15-2020 08:23 PM
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El Chinito loco Offline
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Post: #163
RE: The 2020 Stock Market Crash Thread
Some food for thought:

The 2008 bear market from top to bottom was around a 56% decline in the S&P

In 2000 it was 49%

WW2 it was 30% Although the U.S. benefited tremendously.

In 1929 it was 86%

Counting single day or single week drops is not as important as the bigger picture.

When i'm talking about prolonged bear market this is what i'm saying. It starts as a large correction and then countertrend rallies and then successive waves of declines forming lower lows until market capitulation and fatigue sets in.

Right now I would say that with the way the world is locking down over this virus the market is behaving more like we're in a war time scenario. Not WW2 though, because in this case I don't see any single country benefiting overwhelmingly from this.
(This post was last modified: 03-15-2020 09:15 PM by El Chinito loco.)
03-15-2020 09:14 PM
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Sherman Offline
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Post: #164
RE: The 2020 Stock Market Crash Thread
A full time professional trader I know told me that the low is several months to a year away, so no need to rush to buy now. He also said the corona virus was just a black swan that pulled back an overbought market. If it wasn't the virus, another event would have triggered the pullback. Thus, if the corona virus vanishes tomorrow, the market isn't going to spring back to its previous high.

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03-15-2020 09:23 PM
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NoMoreTO Offline
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Post: #165
RE: The 2020 Stock Market Crash Thread
I am putting in orders to sell everything that I still have in (Currently 70% Cash, 30% equity) at market tomorrow. Fuck this. I'm still nominally up.

For professing themselves to be wise, they became fools. Rom 1:22
03-15-2020 09:55 PM
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joost Offline
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Post: #166
RE: The 2020 Stock Market Crash Thread
IF the COVID-19 is the reason (or excuse) for the markets to go down, looking at the situation report from WHO is a good point to start:

https://experience.arcgis.com/experience...ee1b9125cd

[Image: Screen-Shot-2020-03-16-at-12-09-53-AM.png]

IF there's a correlation, it means that we're still inside the storm.
03-16-2020 12:14 AM
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Tail Gunner Offline
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Post: #167
RE: The 2020 Stock Market Crash Thread
(03-15-2020 09:14 PM)El Chinito loco Wrote:  Some food for thought:

The 2008 bear market from top to bottom was around a 56% decline in the S&P

In 2000 it was 49%

WW2 it was 30% Although the U.S. benefited tremendously.

In 1929 it was 86%

Counting single day or single week drops is not as important as the bigger picture.

When i'm talking about prolonged bear market this is what i'm saying. It starts as a large correction and then countertrend rallies and then successive waves of declines forming lower lows until market capitulation and fatigue sets in.

Right now I would say that with the way the world is locking down over this virus the market is behaving more like we're in a war time scenario. Not WW2 though, because in this case I don't see any single country benefiting overwhelmingly from this.

The "big picture," which you fail to acknowledge, is this fact:

   

We are in uncharted territory here. The market has literally crashed faster than the Great Crash of 1929. You fail to acknowledge that fact.

I am not saying to panic. I am saying that you must acknowledge some basic facts. This is not a typical correction.

Pray for a quick V-shaped recovery. In the alternative, raise cash to buy at the market bottom to offset any investment losses from the crash.

I am not necessarily a pessimist. Anything can still happen. Europe is an economic basket case. Perhaps European investors flee from European equity markets into U.S. equity markets. Europe's weakness may present an opportunity for the U.S. to grow even more dominant.
(This post was last modified: 03-16-2020 12:31 AM by Tail Gunner.)
03-16-2020 12:22 AM
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Post: #168
RE: The 2020 Stock Market Crash Thread
(03-14-2020 01:37 PM)bacon Wrote:  Way too much pessimism, stocks will rebound. I have been buying at these levels and have faith this period of market turbulence will pass as it always does.

Below is an OP-ED Warren Buffet wrote during the 2008 bear market in the New York Times.

Pretty sure Buffet was heavy cash before this all went down.

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03-16-2020 12:26 AM
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Tail Gunner Offline
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Post: #169
RE: The 2020 Stock Market Crash Thread
(03-16-2020 12:26 AM)NoMoreTO Wrote:  
(03-14-2020 01:37 PM)bacon Wrote:  Way too much pessimism, stocks will rebound. I have been buying at these levels and have faith this period of market turbulence will pass as it always does.

Below is an OP-ED Warren Buffet wrote during the 2008 bear market in the New York Times.

Pretty sure Buffet was heavy cash before this all went down.

Yes, it is about $ 130 billion in cash. He held cash not because he though that the market would crash, but because no companies offered good investment value. Of course, a market crash is one way to find great bargains. Wink Hence, the "Buffet Indicator."

https://www.ccn.com/buffett-indicator-wa...than-2008/
(This post was last modified: 03-16-2020 12:38 AM by Tail Gunner.)
03-16-2020 12:35 AM
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El Chinito loco Offline
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Post: #170
RE: The 2020 Stock Market Crash Thread
(03-16-2020 12:22 AM)Tail Gunner Wrote:  The "big picture," which you fail to acknowledge, is this fact:



We are in uncharted territory here. The market has literally crashed faster than the Great Crash of 1929. You fail to acknowledge that fact.

I am not saying to panic. I am saying that you must acknowledge some basic facts. This is not a typical correction.

Pray for a quick V-shaped recovery. In the alternative, raise cash to buy at the market bottom to offset any investment losses from the crash.

“It’s always different this time!”

How about toning down the passive aggression a bit there champ?

The market is around -20% right now.

My point is not a rosy appraisal or however you think i’m interpreting this but pointing out that the final bottom usually takes awhile to form with successive waves down. I’m actually pointing out this is most likely not over.

Time horizon matters very much during any prolonged bear market. If you are “praying for a V recovery” then you probably shouldn’t be in the market to begin with.
03-16-2020 12:42 AM
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Tail Gunner Offline
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Post: #171
RE: The 2020 Stock Market Crash Thread
(03-16-2020 12:42 AM)El Chinito loco Wrote:  If you are “praying for a V recovery” then you probably shouldn’t be in the market to begin with.

I'm not in the market. I had an exit plan. I will buy again at the bottom.


(03-16-2020 12:42 AM)El Chinito loco Wrote:  but pointing out that the final bottom usually takes awhile to form with successive waves down

And I am pointing out that, at least so far, this has been far from the usual case. One more "successive wave down" like the first one and we may hit the bottom very quick.
03-16-2020 01:29 AM
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Post: #172
RE: The 2020 Stock Market Crash Thread
Stock prices have been divorced from fundamentals for a good ten years so who knows what could happen. I don’t see lower interest rates being a big help (the old pushing on a string analogy).

They should do an experiment and implement a temporary UBI for six months. Or suspend all mortgage and car payments. Stuff like that.

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03-16-2020 06:24 AM
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Post: #173
RE: The 2020 Stock Market Crash Thread
Some new charts for a frame of reference. I am NOT saying that this will necessarily happen.

   

   
(This post was last modified: 03-16-2020 09:55 AM by Tail Gunner.)
03-16-2020 09:51 AM
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Post: #174
RE: The 2020 Stock Market Crash Thread
Stocks shitting the bed today after all 3 world major economies shut down. Who could have seen this coming? Rolleyes No amount of money printing will overcome such fundamentals without extreme inflation.

You folks haven't seen nothing yet, these stocks are going to hell. Of course there will be many more "bounces" back up so the big boys on wall st can fleece some more goys on the way down.

Stocks might rebound after the development of a vaccine, which is... what, years away? Those who sell now will be in a great position to re-enter then.

I suppose there is one way for stocks to survive right now, which is how people are crying for stocks to be shut down for two weeks. I suppose if we ban selling, stocks will never go down!!!1

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(This post was last modified: 03-16-2020 10:58 AM by Samseau.)
03-16-2020 10:56 AM
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Post: #175
RE: The 2020 Stock Market Crash Thread
If there is a strong selloff today, the market could go down 40% to 50%. However, so far this morning it has stablized in a trading range. There was a lock limit this morning, and the market opened 15 minutes late.

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03-16-2020 11:12 AM
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