Down goes the Dow

Ghost of Igloi wrote:

Johannes wrote:

This is great! You mentioned you have schooled your kids on saving for home ownership. Will you be recommending they buy now/soon?

No, it will take a couple of years. I would say a 40-70% (depends on market) haircut to housing by 2022.

Also the problem becomes liquidity and acquiring credit. Everyone wants to buy the historic dip until you realize banks will only give loans to people with 110% down payment and credit scores of 900

Ghost of Igloi wrote:I hope your spotting a radical Kentucky mullet.

I lived in Lexington, Kentucky for three months in 1976 or 77, when my dad was there taking some kind of university course. Me and my siblings got to dodge school the whole time, which was pretty sweet! My clearest memory is a light snow fall that ground the whole place to a halt for a week or two. Also, we drove down in an Austin Mini (one of the original tiny ones), with four little kids in the back, stacked up like cord wood, each reading a stack of comic books to pass the time. No such thing as back seat seatbelts at the time. The car had a block heater (I may need to explain that...?) which my folks plugged into the house at night. They had numerous people come to the door asking about the "electric car." :-)

I don’t house them.

Ghost of Igloi wrote:

I don’t house them.

Ok. Again I misunderstood.

So what are your recommendations for them with regards to saving to buy a home when they are currently paying rent for their current living space? That can be quite challenging, so I would love to hear your advice. Especially for someone like your son who also owns a business.

Hello all - hope you all are healthy.

Dow up around 23% from its monday lows.

and that, ladies and 'gentlemen,' is why market timing is hard.

you know millions of people said 'eh get me out, there'll be time to get back in

23% in less than 3 days.

For the books.

I think everyone assumes there will be a retest of the lows...that could cut either way. Some are waiting to buy back in, but others will sell very very fast when this thing noses over.

Tech stocks are barely below their 200 day moving average.

I've been buying every day...got a position in utilities now...they got tossed out with the bathwater for some reason.

I'll be back on the thread when we get close to the 200 day moving average.

3.28 million unemployment claims.

Yikes

Got it, dead & unemployed people are a good longterm investment.

I find it boggling that the market continues to rally based on this stimulus. Unemployment, GDP, and earnings numbers will be brutal for months to come and continue to drag afterwards during the recession.

Although a financial adviser I run with has been spot on with his predictions. He says the 18,000 level for the Dow pretty much priced in all the turmoil. Thinks that will be the bottom.

But this isn't a normal recession. Entire sectors of the economy will be shut down for months. At least during a typical recession, people are doing things and buying stuff, just to a lesser degree. Things are completely shut off for an indefinite period of time. I find it hard to believe the market won't drop more.

sub sub elite local hobby jogger wrote:

I find it boggling that the market continues to rally based on this stimulus. Unemployment, GDP, and earnings numbers will be brutal for months to come and continue to drag afterwards during the recession.

Priced in

Short term, technical trading seems to be in control of the market now. I'm sitting out but I'm not nimble enough to short-term trade so I'll stay on the sidelines a little longer.

It seems that the unemployment numbers were already factored into the market. I'm concerned that the stimulus is being factored in as we speak and this bullish trend will reverse soon and hard.

It took WW II to price in the Depression, through phases of laissez faire and an extensive safety net, it kept going down. Approximately 10 years.

fisky wrote:I'm concerned that the stimulus is being factored in as we speak and this bullish trend will reverse soon and hard.

+1

the idiot wrote:

fisky wrote:I'm concerned that the stimulus is being factored in as we speak and this bullish trend will reverse soon and hard.

+1

That said, I'm not sure if I should worry more about the opposite and missing the boat...

Racket wrote:

sub sub elite local hobby jogger wrote:

I find it boggling that the market continues to rally based on this stimulus. Unemployment, GDP, and earnings numbers will be brutal for months to come and continue to drag afterwards during the recession.

Priced in

to be fair, there is huge technical issue pushing up the market...huge dollars bought puts to protect large portfolios...they paid ridiculously high prices for that protection. Then the VIX dropped and those puts started losing millions every second. So the funds got whiplashed and had to buy stocks to cover the increasing losses from the puts.

It's a form of a short squeeze...the higher the market goes, the more the puts lose value and the more funds have to 'buy to cover.'

this could very well be the largest short squeeze in the history of mankind.

Dow up 24% since monday's lows.

24%.

Hard to imagine.

I remember I was saying 'hey you might miss the bounce...in 2009 the market was up 20% in two weeks.'

this is up more in c. 3 days.

Legendary.

DJIA at close 1987-10-19: 1,738.74

DJIA at close 2020-03-26: 22,552.17

13 times your money in 33 years.

Sounds like a good deal to me.

Ghost of Igloi wrote:

I don’t house them.

Congratulations! Your 36 yo son finally moved out? You and Sally must be thrilled.

agip wrote:

Racket wrote:

Priced in

to be fair, there is huge technical issue pushing up the market...huge dollars bought puts to protect large portfolios...they paid ridiculously high prices for that protection. Then the VIX dropped and those puts started losing millions every second. So the funds got whiplashed and had to buy stocks to cover the increasing losses from the puts.

It's a form of a short squeeze...the higher the market goes, the more the puts lose value and the more funds have to 'buy to cover.'

technicals are like reading tea leaves, it's all fake and made up, and just vague enough to apply to almost any scenario. This was more like a "puts" mini bubble.

Stack the bodies high, brothers. If dead people are profitable, this’ll be a legendary bull market. We caregivers invest in people, so that’s where my bread is buttered. Sad to say, business will be booming for us.