Down goes the Dow

fartlekpa that is probably a smart thing. Again what would be the upside scenario?

It will be interesting to watch what happens to the USD. Looks pretty good, except priced in gold.

We will see how “strong” markets are. The narrative is becoming more difficult to control, as the sheep become skeptical. I do not think there will be any massive instantaneous crash, but a regular drawdown instead.

For sure, it will be interesting.

100% agree. I hope I'm wrong but this has smelled foul since early January. My worry is we keep pumping cash into the system to give the appearance of stability. China seems to be pushing this narrative by returning people to work--completely insane. Italy and S Korea are seeing what happens when you don't prepare. We may be hot on their tail. Again, hope I'm wrong.

I worry about the USD of course too...but not sure what I can do about it (w/ my retirement at least). If USD fails, I don't see a lot of safe havens.

I own some crypto--but more as an insurance policy (ie. a very small amount). Here's to hoping this does in fact pass.

fartlekpa wrote:

100% agree. I hope I'm wrong but this has smelled foul since early January. My worry is we keep pumping cash into the system to give the appearance of stability. China seems to be pushing this narrative by returning people to work--completely insane. Italy and S Korea are seeing what happens when you don't prepare. We may be hot on their tail. Again, hope I'm wrong.

Well, cash pumping should be part of the problem, as it should erode the USD, depending on what basket does.

So far it has been solid vs basket.

Perversely, this might be a boon for certain glam stocks, now seen as a sort of safe haven! Above the fray. There might be some merit to that if they are of national strategic importance, Alphabet for instance.

fartlekpa wrote:

Here's to hoping this does in fact pass.

Amen to that.

That's true. Looking for antifragile stocks should be high on radar. Problem is we still don't know what we don't know. Probably won't for a few months. Italy goes two weeks without a case then 50 and 150 on consecutive days. We don't even know how to accurately detect yet. Big problem.

fartlekpa wrote:

It's not about panic. It's about understanding that what has happened before will not necessarily happen again. Meaning--we may not "come back"....or maybe a ton of damage occurs before we are able to "come back". It sounds basic but it is not. You REALLY have to ignore a ton of noise.

I'm incredulous at the number of people who look at what's happening and see it as a sign that markets are strong b/c they haven't (yet) been impacted by what is clearly a global pandemic. To me that's a sign of trouble. It was a sign 6 weeks ago so I consider the fact that we're here now talking about it means we are EXTREMELY lucky.

I hope I'm wrong....but I'm not betting on it. My 401k has been 100% cash for 2 weeks and will likely stay that way for a while.

Do you panic sell like this at everything? Where do you draw the line?

Are you old enough to have lived through a bunch of 'holy carp' moments that we can't even remember anymore because they turned out to be short term panic situations?

I'll bring this post back up in 3 months and we'll see how it aged.

We get a 2% down day every 10 weeks or so, historically.

First time I've ever done it actually. The only way you learn is by trial and error--'07-'08 taught me a lot, mostly thru mistakes. If I take financial advice, it sure as heck doesn't come from people who have to work for a living.

But you're still not getting it.....it's not about "let's see how it turns out". It's about risk management in the face of extreme uncertainty. You're playing a non-ergodic game that is advertised as ergodic.

fartlekpa wrote:

First time I've ever done it actually. The only way you learn is by trial and error--'07-'08 taught me a lot, mostly thru mistakes. If I take financial advice, it sure as heck doesn't come from people who have to work for a living.

But you're still not getting it.....it's not about "let's see how it turns out". It's about risk management in the face of extreme uncertainty. You're playing a non-ergodic game that is advertised as ergodic.

I hear you, but I'll also say that you won't find any great investors who act like you are currently acting.

fartlekpa wrote:

First time I've ever done it actually. The only way you learn is by trial and error--'07-'08 taught me a lot, mostly thru mistakes. If I take financial advice, it sure as heck doesn't come from people who have to work for a living.

But you're still not getting it.....it's not about "let's see how it turns out". It's about risk management in the face of extreme uncertainty. You're playing a non-ergodic game that is advertised as ergodic.

That's why actual investment portfolios are split between stocks and bonds that build in personal risk tolerances.

I'm also not aware of any serious claim that stock movement is ergodic but it sounds like something an economist would try to say.

Racket wrote:

fartlekpa wrote:

First time I've ever done it actually. The only way you learn is by trial and error--'07-'08 taught me a lot, mostly thru mistakes. If I take financial advice, it sure as heck doesn't come from people who have to work for a living.

But you're still not getting it.....it's not about "let's see how it turns out". It's about risk management in the face of extreme uncertainty. You're playing a non-ergodic game that is advertised as ergodic.

That's why actual investment portfolios are split between stocks and bonds that build in personal risk tolerances.

I'm also not aware of any serious claim that stock movement is ergodic but it sounds like something an economist would try to say.

ergodic is a great word. This is the first time I have heard it. In my increasingly poor memory.

I have pounds and pounds of gold and millions of dollars of bonds - that should soften the punch, as it is supposed to. To racket's point.

Not claiming the stock market is ergodic....but you are sold a product that is advertised as ergodic. Also not an economist (I despise them).

Maybe I sound like a broken record but I’ve said for several weeks this virus concerns me. Not for its effects on markets and my nest egg, but for the unpredictable global public health effects. It’s been a long time since there’s been a global pandemic (roughly a century I think); this may not be one, but it scares me like it’s trying to be one.

I’d been moving out of equities into cash for months, recently putting that cash into gold (IAU). Fingers crossed these have been good decisions. In my relatively long investing “career,” most of my decisions have been bad. Hence my screen name... ?

Ghost of Igloi wrote:

Truth is the guy has a couple of loose screws as well as an obnoxious personality.

Oh, the irony!

Says the guy that has zero to offer other than playing his junior high games.

Regarding the markets, Coronavirus exposed excessive valuations across a broad array of assets, extreme Central Bank policies, extended business cycle, and delusional investor behavior. Now is this the start of something far larger? Time will tell, but I am sure we are that much closer based on factors I highlighted.

the idiot wrote:

Maybe I sound like a broken record but I’ve said for several weeks this virus concerns me. Not for its effects on markets and my nest egg, but for the unpredictable global public health effects. It’s been a long time since there’s been a global pandemic (roughly a century I think); this may not be one, but it scares me like it’s trying to be one.

I’d been moving out of equities into cash for months, recently putting that cash into gold (IAU). Fingers crossed these have been good decisions. In my relatively long investing “career,” most of my decisions have been bad. Hence my screen name... ?

Always remember the first rule of panicking; be the first to panic.

Seeing ads for this on Bloomberg this morning.

Another way to play the virus, short the Sox.

Just as the Sox was ground zero in the US-China trade war, now ground zero for the coronavirus. If not up for shorting, the Sox will serve as a good gauge of investor sentiment.

la gente ésta muy loca wrote:Always remember the first rule of panicking; be the first to panic.

Ha ha, fantastic. Words to live by.

My spouse has been preparing for the zombie apocalypse for years by eating food well past its best before date. One of us at least has been pre-panicking, in a way, for decades...