
Dow Falls 2997 points worst drop since 1987 crash - blackhat2017
http://www.mortgagerateguru.com/2020/03/16/dow-falls-2997-points-worst-drop-since-87-crash/
======
mgolawala
To put it into perspective, the last time the market behaved like (multiple
drops of this magnitude) this was 90 years ago, in 1929, and it was at the
start of the Great Depression. Today was the second largest percentage drop
for US Markets in history.

Now is not a good time to sell your stock holdings (at least not anymore).
This smells of a panic right now.

I think a severe recession is all but guaranteed at this point. Let's hope we
get through this with no more than that.

~~~
Reedx
Maybe, but why don't you think the markets will bounce back once we're on the
other side of this? Have underlying fundamentals changed longer term?

South Korea, China, Singapore are encouraging and seeing a return back to
(almost) normal life. Granted, we're not dealing with this nearly as
effectively and there may be a 2nd wave to come. But at this point they seem
to make the case for optimism.

~~~
seanmcdirmid
A lot of ventures that were hanging on by threads will be ruined by this, so
the pandemic is likely to clear out a lot of the weaker businesses as any good
recession or crash is apt to. It will take a while for the marker to grow
around that loss (though good in the long term, there is pain in the short).
It could also trigger a housing correction, which has ripple effects on the
construction industry, and those people are no longer eating at restaurants,
and so on. Think of busts being inevitable anyways, and a crisis is merely the
way into one.

~~~
jdhn
>It could also trigger a housing correction

What would a housing correction look like? Demand still outstrip supply in hot
markets, so the worst thing that'll happen is that the housing prices will
have a slight dip, and that's it. Also, with the Fed lowering interest rates
to zero and possibly lower, that'll continue to inflate the value of assets
such as houses.

~~~
harambae
If it gets bad enough (and I don't want to seem insensitive here) a bunch of
elderly people die and their houses are on the market.

------
SirensOfTitan
I’m buying S&P index every day at this point, trying to drive my average down
without trying to find the bottom.

...with that being said, I feel really worried about American economic
stability long term now. Governors are closing restaurants and businesses
leaving tons of folks out of work while providing minimal safety net coverage.
Even liberal states like New York are ignoring the downstream economic effects
these closures will cause. If most Americans truly cannot afford a $500
surprise bill, we’re in for a very, very rough ride.

~~~
rconti
Every time I see this, I fail to grasp the logic. So you had money sitting on
the sidelines for safety during boom times, and you elect to put it in a
riskier asset class during a panic?

I'm not saying this isn't likely the most profitable action, I just don't see
how the principles are consistent with each other. The former is conservative;
the latter is wildly speculative and risky.

~~~
gizmo686
Its not fundamentally crazy.

In one sense, standard investing advice is to periodically rebalance between
investment classes when your holdings diverge too much from you desired
profile. In this, for a "simple" investor, that would probably mean
transfering from bonds to stocks; since the portion of your portfolio that is
in stocks recently fell substantially below your desired portion.

Assuming an efficient market, it is almost a no brainer that you should
rebalance. Since your risk profile didn't change from a month ago, and stocks
are being correctly valued, your portfolio is now overly conservative.

If you dont believe the market is effiecient, the question becomes 'in what
way is the market inefficient?'. If you believe it is now undervalues stocks,
you should buy them since they are now on sale for a bargain price.

Personally, my view is that the market is irrational, but I don't know how; so
I am planning on not reballancing until after the dust settles. This minimizes
the downside risk caused by me not knowing what I am doing.

~~~
milesvp
You may be missing one of the more fundamental reason to rebalance your
portfolio at predetermined points in time to a predetermined balance. That it
takes emotion out of the equation. By rebalancing, say, every time you put
money into your IRA, you're always "selling high and buying low" without the
risk that you'll let emotion overturn a generally good investing strategy.

While you may actually be in a position to time the market, my understanding
is that empirical evidence suggests that the vast majority would be better off
not trying to time the market. And that people who mechanically follow
rebalancing procedures will tend to outperform those who rebalance based on
some kind of intuition or market calculation.

------
dictatorsunion
I don't understand why people are catching a falling knife. It is as though
they have never been in bear markets before. Understand the market psychology
and don't waste your money. I have friends who DCA-ed and regret because it
took them years just to breakeven.

In a standard fear cycle (Google it), we are only at the middle stage between
denial and fear. There is an acceleration downwards that we have not
experienced yet (Crypto 2018 and China 2015 are good examples if you want to
look back at recent history). Wait for that to happen first. You also can feel
the time to buy when people are very distraught and demoralized by the endless
drops. Twitter activity will change a lot, trust me.

A good way to read when to buy is, aside from seeing that everyone is
completely mentally exhausted and demoralized, is that the VIX is around 30%
and dropping, and distribution is over with accumulation channels being
formed, which is when multiple supports are being built. This is when bulls
and bears are in equilibrium, with bears quite exhausted but still exuberant.
If you want better certainty, at least wait for the stock you want to buy to
cross the 200 SMA, because it is a good indicator that the stock is being
rationally valued once again.

My point is that DCA is only good if the trend favours it. It is central limit
theorem where you reduce the variance by multiple sampling. Good shorters DCA
downwards as well, so you are fighting these people too if you are DCA-ing
now.

~~~
zone411
Do you have any research showing that waiting for VIX below 30 after it was
high is a correct strategy? You can just test it in around 20 lines of Python
or just in Excel. Or that buying in a situation like now is a bad idea? Did
you run a historical backtest? Did you test the trend following and the
200-day SMA? Please share. Of course, to show that any of them are promising
models, you need to do much more than just the backtests but they are first
necessary steps.

If you haven't done this then you really shouldn't give authoritative-sounding
advice here.

~~~
engineeringwoke
You should really check your tone as well. This is good advice.

~~~
zone411
And you know this because?

------
zizee
PSA: The Dow Jones industrial average is a terrible measure of the stock
market. It tracks just 30 stocks, some which have an outsized influence on the
measure.

This is not to say the stock market is not in freefall, but there are much
better indexes to track general market movement.

~~~
nabla9
Most of the SP500 movements come from small number of companies too.

Dow Jones is bad index but the narrow number of companies is not the worst
part. DJIA is price-weighted index which is completely arbitrary and there is
no reason for that. They can't add Berkshire Hathaway into the index without
completely changing the rules. BRK-A price is so high. Index would track only
BRK-A after that.

~~~
jedberg
I'm not sure why they don't add BRK-B though.

~~~
kolbe
In my opinion, BRK shouldn't really be in the S&P 500 anyway. I don't get why
a company that owns AAPL should be in an index that already owns AAPL.

------
screye
I am not well versed in the economics of depressions, but almost all the ones
I know of were preceded by some monetary imbalance or the explosion of a
bubble based on falsely propped up ownings.

1929 was stock being leveraged off mortgaged homes and loans, that was clearly
no sustainable.

2000 was the dot com burst.

2008 was mass defaults on home loans.

Is there any reason why apart from slow business for 2 months due to corona
and the oil war (that resulted from corona causing a loss in demand), the
economy can't juts go back to being business as usual once this all passes
over ?

Is there a particular kind of asset, the collapse of which will seal this drop
as a proper depression ?

~~~
MrRadar
Most businesses don't have the cash reserves to handle effectively shuttering
for 1-3 months, which is probably what will be required to get a handle on the
Coronavirus outbreak without overwhelming our medical systems. This means
those businesses will be forced to lay off many (if not most) employees,
possibly going bankrupt altogether, and those laid-off employees will
themselves have trouble paying their own bills causing them to go bankrupt,
lose their house and car (and health insurance in the US!), etc.

It's a huge vicious cycle that will almost certainly lead us into a deep
recession in the short term, and will likely require huge fiscal interventions
by the major governments of the world to prevent an outright depression (as
all the remaining monetary options have already been used up to little
effect). It's telling that Senator Mitt Romney was floating a temporary Yang-
style UBI today... even a week ago that would have been unthinkable to hear
from a Republican, even a moderate like him.

~~~
tjs8rj
1\. Most of those problems are being tackled: localities, states, and the fed
have interest free loans and many have frozen rent and evictions (for both
residential and commercial real estate). As far as that goes, 1-3 months with
the above addendums makes me skeptical about mass bankruptcies. 2\. This is
such a silly point I keep hearing: "Everyone is a socialist in a crisis", "Oh
suddenly people realize UBI and universal healthcare are good!" \- DUH!
Collective problems require collective solutions. Everyone agrees that the
tax-payer foots the bill for the healthcare of veterans in WW2, everyone
agrees with price-controls when fighting Nazi Germany. Everyone agrees with
collective action to fight collective threats because it's necessary.

If you contract a pandemic disease, collective action must be taken for the
good of everyone else. If you break your leg falling of your roof on a bender,
you and only you should foot the bill. This isn't hard: supporting collective
action against Coronavirus doesn't mean M4A is a good idea for more normal
situations.

------
legitster
I'm a bit more optimistic about this crash - a significant portion is due to
the (important) constraints on society - closing schools and restaurants.
Meaning we can look forward to some pent up demand on the other side when
those constraints are loosened.

On the other hand, if the US goes into lockdown for a month or more, there's a
significant chance that we could be returning to a world very unlike today.
The market does not like this kind of uncertainty, and an house of prevention
would have been worth $10 trillion dollars of cure.

~~~
underbluewaters
Sorry to single you out, but the fact that people still don't understand that
a 1 month+ long lockdown is a certainty means we are nowhere near the bottom.
By April the US is going to look a lot like where Italy is at now.

~~~
rupert1234
Sorry to single you out, but the stock market usually trades in anticipation
of recessions. It's not a proxy for the current GDP, it's an expectations
market. The stock market could start a slow rise tomorrow and go until the end
of the year and the entire year could be in a recession.

~~~
engineeringwoke
As a European it seems like the US markets are a step behind and seemed to
trade pretty optimistically last week and especially the week before even
though the situation was bad in Italy, for example.

~~~
rupert1234
? They were way off last week. If that is your definition of optimistic, I
don't want to see pessimistic.

------
lettergram
Just my 2 cents - Take your assets out of the market.

Until we (in the US) see a few senators, a justice or two and / or the
VP/president/etc succumb to the disease we haven’t hit peak panic.

~50% of the workforce is about to be out of a job for a few weeks. A large
portion of Restaurants are about to go bankrupt, daycares are about to go
bankrupt. Houses are about to drop in price (no money, and elderly dying).

The reality is, this could be worse than the Great Depression. At least if we
keep this up for any length of time. What we are doing right now is seizing
the economy and if we close down everything, it’s going to be hard to start
back up.

Governments are going to crumble because of this.

Long term (a year out) things should be improving. But IMO we have a long way
to fall. I wouldn’t be surprised if banks start folding.

~~~
ScoutOrgo
But if you sit on cash, you will miss the day where it has a huge gain due to
some news like a vaccine announced.

~~~
minwcnt5
To me that's fine. The S&P 500 isn't going to instantly spike back up to 3000.
There is real damage being done to corporate bottom lines. The negative growth
experienced by companies during a recession compounds into all future earnings
-- for the rest of time. So the way I look at it is that the market is pricing
all future earnings of companies, and once the volatility has settled it will
reach some new baseline that's much lower than the peak, and then continue to
grow at a nominal rate, only forward-looking, with no memory of what just
happened. It took 4 years for the S&P to reach its previous peak after it
bottomed out in 2009. So if you've been holding onto cash, or sold near the
2020 peak, you probably have a lot of time to get back into the market and
still end up better off than if you'd bought in a month ago. You don't need to
time it perfectly. I can make a lot of money if I do time it correctly, but if
I fail to I'm not going to count it a loss.

------
aazaa
> Our Advise: It is time to carefully pick up some stocks based on crushed
> valuations, but the market is not likely bottoming. It’s hard to say are we
> two weeks away or months away from market bottoming.

You'll know it's time to buy when the advice you get from permabulls like the
mortgage industry is to sell.

What will happen in between? Failed rally after failed rally. Bear market
rallies are extremely effective destroyers of capital. The suck the gullible
in and spit out the bones.

By the time it's really time to "pick up some stocks based on crushed
valuations," nobody will care about stocks. And nobody will care about or
believe the rally.

------
vearwhershuh
The current S&P P/E ratio is still higher than it was at any other time except
the 1920s bubble, the .com boom, and the top of the 1960s bull market.

[https://www.multpl.com/shiller-pe](https://www.multpl.com/shiller-pe)

There are problems comparing the P/E over time periods this long, but it is a
cautionary datapoint.

~~~
akvadrako
Yeah, when everything is a bubble it’s bound to pop sometime.

Probably just too much free cash for banks.

------
jcranmer
By percentage, this isn't just the worst drop since the 1987 crash--the 1987
drop is the _only_ worse drop. This is worse than any day in the Great
Depression.

~~~
raincom
If there were no circuit breakers, we would have witnessed drops worse than
the 1987 drop. The 1987 crash brought forth circuit breakers, limit up/down in
the futures markets.

------
thinkloop
The S&P 500 is down 30% since Coronavirus started [1], back to April 2017
levels [2], about three years worth of gains erased.

But this comes after a decade-long record bull run that's been begging for a
15% correction. Treasury yields were inverted a few months ago, last week bond
prices got disjointed from their underlying assets, QE has been incessant
since 2008, rates are at literal zero - the bull market was fake, propped-up
and political; there is nasty sausage festering in the belly of our financial
system and it's set to explode. Get ready for at least another 30% drop.

Or:

The internet is truly the greatest invention of all time. There is nothing
more valuable than the exchange of ideas. We have only begun reaping its
rewards. It will be responsible for another 100 year bull run of greater
magnitude than the industrial revolution. Not only is innovation at record
levels, but the pace of increase of innovation is at record levels. The bull
run was not fake, P/E levels of the S&P are in line with historical averages
[3]. We are taking Coronavirus very seriously and China has shown that you can
"flatten the curve" when you do [4]. This will blow over in a few months and
the economy will be right back to where it was. But the stock market is
forward-looking and can recover in an instant, the buying opportunities are
now.

[1] [https://imgur.com/a/aq2yw70](https://imgur.com/a/aq2yw70) (chart)

[2] [https://imgur.com/a/EOWR4Kf](https://imgur.com/a/EOWR4Kf) (chart)

[3] [https://imgur.com/R0zpJiP](https://imgur.com/R0zpJiP) (chart)

[4] [https://imgur.com/VTMOeh9](https://imgur.com/VTMOeh9) (chart)

------
appleflaxen
This is only the first round.

The second round will be over-leveraged investments being uncovered, as any
leverage they had in stocks evaporates.

Given that the over-leveraged loan situation was out of control during the
2008 GFC, and nothing structural was done to change behavior, it's extremely
likely we're going to see some secondary changes.

~~~
engineeringwoke
Correct. Let's wait and see where the path of least resistance takes us. It
goes somewhere from the commercial paper market to anyone levered, all the
usual TBTF suspects.

------
anonu
Worst drop ever for the Nasdaq Index today: -12%. These aren't 1, 2 or 3
standard-deviation events... these are more like 6 or 7 standard-deviations
from the mean...

~~~
usaar333
Vix is currently at 82%, rather than a more typical 15%. You should expect
daily fluctuations of 5 to 6x what is ordinary for the next month. In fact
today's drop is only about 1 standard deviation.

~~~
raincom
VIX was suppressed so long through shorting VIX futures via ETNs like $XIV,
$SVXY up until Feb 5, 2018. Then the latter ETNs blew up. Lots of people made
money just buying these ETNs. This was one way VIX was suppressed.

------
anonuser123456
Something to consider for people thinking of jumping into the market via an
index fund; in 2008, corporations were in OK shape to weather a downturn. In
2020, a lot of corps are very highly levreged. I think it's likely we'll see a
lot of shareholder wipeouts. This will have an interesting effect if you buy
an ETF. If 50% of your stocks get wiped out... that big bounce you might
expect won't be in your portfolio. Yes, the index will recover it's value...
but the composition of pre-post shareholders will be different.

I don't think the country is in the mood for shareholders to get bailed out
unless individuals get bailed out first... and I don't see that happening.

------
throwaway713
So I know it's almost impossible to predict the stock market, but... a lot of
this crash seems to be based on panic and human psychology concerning the
virus (I know there is some effect due to the oil price war though).

My question is: if we assume 20-40% of people in the U.S. are drastically
underestimating how bad the virus is going to be, then they are more likely to
hold their stock until there is finally "proof" that the virus is as bad as
everyone with some amount of scientific understanding knows it is going to be,
at which point we would expect some portion of these people to panic sell.
Wouldn't that indicate that in an event like this, we're not betting on
essentially random fluctuations of an emergent economic system, but rather on
many people not understanding the trajectory of the virus?

In other words, it's almost like a prediction market at this point — you're
betting against other people about how damaging the virus is going to end up
being. Am I off base here?

~~~
sgillen
I would argue that to some extent that’s how the stock market works all the
time. You’re betting about how other people will react to information.

------
say_it_as_it_is
This is the moment that management cuts staff and pushes survivors to work
harder than ever with no more than the threat of the axe. Realizing
productivity gains from job insecurity is unethical, so it only gets used
under the illusion that it is the only way for the employer to survive. The
reality is that the employer could have operated like this all along but
couldn't drop the axe without looking like a butcher until now.

Getting laid off is sometimes better than surviving the shit show that is now
to come. Quitting for new work, even better.

Seize the moment, people. Do not be a victim. You can rebuild your careers. Do
not stay with a butcher.

~~~
tomp
Seriously?! "Quitting for new work" when in a week or so no companies will
even be doing in-person interviews?

This sounds just insane to me. "Quitting before you find a job" is bad advice
even in _very_ good economy.

~~~
seanmcdirmid
The boat on in person interviews sailed a couple of weeks ago.

------
ghastmaster
Housing needs to follow. For people looking to get into the market like me,
these prices are a barrier.

~~~
tathougies
Housing is unlikely to follow unless more old people die of covid than
expected. Rates are so low and big money will be looking to diversify into
alternate asset classes.

~~~
selectodude
A million dead, mostly elderly, is not completely out of the realm of
possibility, especially if we hit the high end of 150 million infections in
the US. Statistically, 150 million infections would kill closer to 4 million.

~~~
rnd33
The number of confirmed cases in South Korea is flattening out at around 8,200
people out of a population of 52 million (0,016 %), China is flattening out at
81,000 cases (0,006 % of the whole population). Is it really reasonable to
assume the number of infected people in the the US will be 3,000 to 8,000
times higher?? If these are the calculations Wall Street are doing then I'm
not surprised the stock market is falling...

~~~
tathougies
The stock market is falling because (a) individuals and businesses are
liquidating positions to have cash on hand and (b) people are worried that,
without a liquidity package from the government, major businesses are in
danger of being liquidated.

------
skrowl
This probably isn't the bottom. Wait a little while longer and when things
start picking back up, dump in as much as you can afford.

~~~
zenlot
Worst advice ever. Do not try to buy the dip in this market. Most likely it
will lead to loosing money.

~~~
foobarian
You only lose money if you sell :-)

~~~
Matheus28
Don't forget the opportunity cost of waiting 5 years for your investment to go
back to net 0 :)

------
visualstudio
Dumb question. Why can't they just turn off all stock markets for a month?

~~~
seanmcdirmid
That is sort of like turning off a heart rate monitor during a heart attack.

~~~
imperialdrive
Think of it as putting someone in a medically induced coma. It's not really a
terrible idea. Anyone working in finance could enjoy the downtime and use
their time to help local city/hospital/neighbors etc. US bails out finance,
finance in turn pitches in. Could be a nice win-win.

~~~
seanmcdirmid
Well, you would really have to be in a coma though where you or any company
didn’t need any liquidity the market provided.

------
whatshisface
All of the return-seeking money that pushed up asset prices in the first place
is still out there, because stock market crashes don't destroy money (they
just redistribute it). I wonder who has it now, and I also wonder when it will
end up back in the market.

~~~
dougmwne
I was under the impression that the money supply can contract since most of it
is in the form of debts and asset valuations and not in cash. If my house is
worth $1 million but then because of a recession, less people are interested
in buying houses and its price goes down to $500k, where did that money go?

~~~
whatshisface
> _most of it is in the form of debts and asset valuations and not in cash_

There are several definitions of money supply, but I don't think asset
valuations are included in most of them.

------
breatheoften
To those that think the market response is likely to become predictable
anytime soon — a thought experiment ... how do you think the markets will
respond if Warren buffet dies of corona virus? Personally I think this kind of
event could trigger a large change in the market (who knows why) and am
curious what others think.

------
bedhead
I manage a fund for a living and have been doing this stuff for a while. I'm
generally an optimist...and I've never been more terrified in my life than
now. This makes 2008 look like a keg party. We have a health crisis and the
prescription from government has been to induce an economic crisis, one that's
possibly (and increasingly more likely) orders of magnitude worse than
anything we've ever seen, including the great depression. We are committing
suicide. This is a battlefield triage situation, you save the soldiers you can
and read the others their last rights. It makes me utterly sick to say that,
but that's the grim reality. We need to _immediately_ change our approach and
adopt what the UK is doing. AMA

~~~
fock
people dying everywhere (which, with a hopeful 2% letality is still very
likely) will also heavily disturb the peace as well as the economy. As long as
we are not sure about basic things like that, I'm quite for a lockdown,
because a 7% letality is still not off the table (with happy things like
reinfection) - and this is basically about double the loss of life of WW2
(which at least had a clear winner, being able to play out its game).

So: how are you sure that the parameters of the pandemic are something, the
system can handle? Is there any precedent for that? What reason is there, that
our society (that's the people, making up this system) can't overcome this
crisis with something different?

~~~
seanmcdirmid
It isn’t clear that the corona virus will have a noticeable effect on death
rate in any specific city, region, or country. It would have to kill a lot
more people before it even showed up in the statistics in a place like Wuhan
that has gotten the brunt of it, I think.

~~~
fock
so, only a fraction will be infected? What's your evidence for that
assumption? Or it's burnt out in Wuhan? How can Italy have like the same
fatality number for _a lot_ less people? Basically we don't know and we've
been following experts claiming "it's a flu" for about 3 months. Then people
started dying in Wuhan, Iran, Italy? Don't you think that we should maybe try
something different now?

~~~
seanmcdirmid
For the death rate to rise, a lot of people have to get infected and die. Keep
in mind there are a lot of deaths from everything else, so for the corona
virus to bring that overall death rate number up in any meaningful way, it
would have to be huge.

~~~
fock
death rate (mortality) of the total pouplation is around 1-2%/year. Yeah, the
coronavirus would have to be huge to increase that - but what is your evidence
that it's not being able to get as huge?

------
bubbleRefuge
I think as soon as there is some clarity around fiscal policy, we will see
markets stabilize. Fiscal policy is coming, we just don't know the extent. So
2 or 3 months from now the virus will have burned out and we will have massive
amounts of fiscal stimulus in the economy and the boom ensues. This is the way
our Economy and stock market function. As soon as the stock market begins to
see this, it will explode to the upside. That maybe in a week or a month or 2.

------
CRUDite
Well, as someone who has traded alot, i did always wonder when the 2013 gap
would be filled.. but at ~ 150 spy that is still far away.

------
Waterluvian
I have a "balanced" index fund with my retirement savings. I'm 33. I'm simply
not touching a thing. I hope this is the correct move.

It's amazing. I think I'm a pretty smart guy and I'm finding it very difficult
not to second guess these choices. And the worst time to make choices like
this is during financial crisis.

~~~
veggieburglar
I’m in the exact same boat. I’ve never done so much reading and research to do
nothing before.

------
atsushin
I've got some saving and am considering looking into trading if the market
gets any worse than this. Do any of you have advice? I was doing some research
into ETFs and was considering putting some money in that direction since it
seems safer than buying individual stocks.

------
whycombagator
Also the worst % drop since 1987[0]

[0]
[https://en.wikipedia.org/wiki/List_of_largest_daily_changes_...](https://en.wikipedia.org/wiki/List_of_largest_daily_changes_in_the_Dow_Jones_Industrial_Average#Largest_percentage_changes)

------
alexandercrohde
Maybe people won't like this question. Is there a point at which does "social
distancing" do more economic damage than it does health good?

(Not saying we're there yet, just asking if such a point exists, and when.)

------
testacct316
Trump threatened Powell's job in order to force him to reduce interest rate
and start printing money [1]. Our economy is being micromanaged by Trump who
is not an expert in monetory policy and only has disdain for experts of all
kinds (virus/economy/climate). Trump says he is qualified to do that because
his uncle went to MIT [2].

[1] [https://www.nytimes.com/2020/03/14/business/economy/trump-
po...](https://www.nytimes.com/2020/03/14/business/economy/trump-powell-fed-
chair.html)

[2] [https://www.washingtonpost.com/outlook/2020/03/12/truth-
abou...](https://www.washingtonpost.com/outlook/2020/03/12/truth-about-trumps-
uncle-what-it-means-his-presidency/)

------
arthurcolle
SPY puts printed today. Up 110%, sold before Trump had his press conference.

I think there's going to be a little bit of a bounce tomorrow and then resume
drilling.

~~~
synaesthesisx
Agreed. I had puts on TQQQ and also UVXY calls (yes, I play volatility like a
madman). My last couple TQQQ puts sold today for....5100%

~~~
arthurcolle
I'm "super" long vol now, have a limit buy for those hilarious 130 VIX calls.
If meteor strike happens, I'll be in a good place. Costs like 160 bucks,
hilarious way to hedge

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skohan
Is there a risk of a compounding factor with the current level of corporate
debt?

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raincom
Yes, companies issued bonds to finance their buy backs. Best example is
Boeing, which spent $58B in buy backs to parabolically pump its stock to $420.

Today, Boeing lost its credit ratings, and is begging Washington for bailouts.
Zero interest rates don't help much.

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sn41
Is there any estimate of how many years the recession is going to last?

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every
I'll just sit here on my municipal bonds, thanks...

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saiya-jin
Super beginner question - as somebody holding some Swiss cash on top of some
basic reserve, I understand now it would be too risky to enter any stock/other
market. I am a pessimist in expectations what will happen - rather gloomy
state of affairs for next year or so, no fancy vaccine/quick tests etc.

Here is the question - what investment vehicle, if any, would you consider for
looking into when wanting to presumably enter this situation in say 4-5
months? Ideally say some medium term returns, not benefit after 30 years.

Sorry for possibly annoying question to the experts, just looking into some
guidance

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jusonchan
I'd say keep a close eye on the Coronavirus situation. If a vaccine is found
and is effective, likely the market will calm down and hit the bottom. After
that its about keeping the companies afloat until they can get their revenue
back up again. Most likely the quantitative easing programs from the Fed will
help in this regard.

~~~
ailideex
> If a vaccine is found and is effective, likely the market will calm down and
> hit the bottom.

Realistic timeline for this seems months.

~~~
jmull
An optimistic timeline is a vaccine will be available next year and I don’t
think much of the market is looking that far ahead right now.

~~~
ailideex
By that time we may not even need it anymore.

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icedchai
I moved $100K to cash on Friday. I should've been more aggressive.

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yurr
so ..... any thoughts on cryptocoins ??

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yurr
so ..... any thoughts on cryptos ??

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Der_Einzige
All you gotta do is buy puts and you'll be able to ride a yacht in a few years
when this is all over.

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mrpickels
Banks are our friends, the government is like our dad, the media is like our
mom, let's hug them and meet the brave new world!!!

~~~
mrpickels
probably the folks here don't understand sarcasm or you really guys love to
pay taxes and scroll through your facebook news feed...

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amiga_500
I'm quite surprised by this because it was my understanding that companies
were doing us a favor by employing most people. That they were forestalling
replacing us with robots by paying us near subsistence wages.

I'm very confused. On the one hand I have all the things I've been reading in
the papers about workers being superfluous.

But yet on the other hand when I just look at the evidence, it seems like
companies really, really need workers.

I wonder what will happen when this is over...

~~~
mullingitover
Consumer spending is kind of the foundation of the economy, and as of today in
the US it's about to go into freefall. Especially services.

This fall is pricing in the inevitable waves of bankruptcies in the service
industry.

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amiga_500
Why don't the fed just print money, a program could order stuff on amazon and
they could deliver it to a land fill (obviously the landfill would have to be
automated by robots).

for services they could just automate making bookings with a deposit and not
show up. or a little zoomba vacuum thing could show up.

wouldn't be inflationary as cash is being destroyed like mad as we are all
replaced by robots, so that won't be a problem.

~~~
styren
Okay lets see if anybody else has a suggestion

~~~
amiga_500
Nope, because hacker news wants to believe that capitalists are adding more
value than they take out.

