Bought a bear etf for a not small chunk of money I had set aside to reenter. Thought dow 22k was genius by me. Really scratching my head now.
Seems pretty clear that the market is really buying into this peak week theory being floated by the president, some experts and some people around these parts.
Whether or not that is true is going to determine if you win your bet or not. FTR I bought a ton of May 15 calls on a 3x short spy etf yesterday so I am in the same boat.
I think the news does generally seem less dire than it did a week or two ago. But still just gotta lol stonks and stick with a set asset allocation.
On a side note, I’m realizing that I’m likely to burn a bunch of unused FSA money because no one in my family is going to the doctor. I mean, that’s a pretty first-world problem, but I’m very skilled at getting irritated about minor things.
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Maybe I am missing something but if we are effectively slowing the spread by social distancing and having parts of the economy effectively shut down isn’t that an argument for continuing to do it?
Having some 12 month cycle where we are semi-paralyzed by these measures seems worse for the stonks than just letting it burn through us in a couple of months. Obviously I am not advocating for that, just saying the markets I would think would prefer it. If we stay at 35k new cases a day (i realize the testing data is mostly worthless) it will take nearly 10 years for everyone to get exposed. So it’s basically vaccine or reliable antibody test or bust. And both of those seem pretty far off to me.
Probably not worth even typing this, as it’s just a complete guessing game at this point, at least for me. But my view is that there’s a combination health crisis and financial/economic crisis. There seemed to be (still seems to be) two schools of thought:
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Rip the bandaid off and get the economy going again. Sure some people are going to die, but crudely speaking, those deaths will be concentrated among the elder and non-productive members of society. In terms of quality-adjusted life years lost, it’s actually not that bad. But we can’t let the economy just break down. [This is cold, unfeeling language but I think it gets the point across.]
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An economy doesn’t exist without the members of society. So we can’t act as if the financial/economic crisis is fixable without addressing the health crisis. If we can fix the health crisis, a strong economy will naturally re-emerge.
My view is the second, and my silly, unsupported interpretation of recent market movements is that the administration has shown some signs of moving from the first view to the second, and investors perceive that as the correct view.
Again, this is just me daydreaming and making up stories. It’s a complete fool’s game to try to explain short-term market-level stock price movements.
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Lots of “non-essential” business is essential to lots of “essential” businesses. The collapse of shipping is because of a collapse in the economy. And businesses can be shut off like a faucet, but it’s not always so easy to turn them back on.
I just bought in on SPY puts this morning (late May exp/strike 200, and mid July exp/strike 220), so count me in the pessimists camp I guess.
If we get out of this with basically one semi-slow year of widespread losses and then it’s smooth sailing, which is what the market is indicating their median scenario is rn, then that’s fantastic. But I think as a median scenario that’s super optimistic.
Administration officials were talking about having tens of millions of antibody tests per week available in like four to six weeks. I don’t know if that’s actually going to happen but it would be huge for getting people back to work and even getting bars and ballgames going again reasonably soon.
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Right but we were also supposed to have 50 million tests 3 weeks ago also.
And we have no guarantee that this doesn’t mutate into some kind of second strain that isnt recognized by the antibody test
Administration officials have been talking about a lot of shit.
I’m struggling to put this into concise words, but I feel like there’s a realization in the markets that:
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The Trump Administration and the Fed will not allow the stock market to drop too low, if it is within their power. There will be tons of liquidity pumped in, the Fed would buy equities if they had to, and there will be massive bailouts on corporation-friendly terms.
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High unemployment = low labor costs, which will help the corporations during the recovery.
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The numbers are going to flatten off to what the public deems an acceptable level in order to return to some form of normal, and they won’t go up too much more from there in terms of deaths per day or whatever. Now, whether the finance bros realize that the numbers are bullshit or not doesn’t really matter in terms of the end results in the stock market because even 1M deaths in America shouldn’t fundamentally move the value of equities very much unless it alters behavior among the population for months/years.
So the question is only about the public’s perception of and reaction to the numbers/situation, and a big chunk of that percentage voted for/likes/doesn’t despite Trump…
It still seems mind-boggling to me that we’re back to DOW 23.5K or whatever, when we’re far from through this… The only thing left that might not be priced in is the risk of a second, third, etc wave of shutdowns.
But of course keep in mind that if the powers that be want to force people to keep working, they can just shut off the spigot of $600/wk bonus unemployment.
This rally sickens me.
Lol
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Pretty much everyone in govt has a huge incentive to get antibody tests going. Incentives for swab tests haven’t always been so clearly aligned. Could be one cause for optimism on that front.
They’d have to do both antibody and swabs, actually. Because if you have an active infection you might not have a positive antibody test. And a positive antibody test doesn’t necessarily mean you’re not infectious, I don’t think. But if you have a positive antibody test and a negative swab, you’re likely good to re-enter society for the next year at least.
And double checking what was said, it was Giroir who said it, and he actually said it was tens of millions of swabs and antibody tests per week that will be available in the “very near future”. Which would obviously be great, and given we’re testing about a million a week right now, doesn’t seem that far fetched.
Nobody knows nothing.
People think the market bounces back quickly because that’s what they have experienced. If covid and election fall a certain way, it could happen. I doubt it, but it’s not impossible.
A gambling event if I ever saw one. And I’m not gambling with life savings.
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Not gambling is also gambling.
God forbid anyone find it repulsive how little value our society places on human lives.
The stock market rally isn’t indicative of the market not valuing human life. It means that the consensus opinion about how many more people are going to die of this thing is substantially different than your opinion. If you’re right then the stock market will plunge again and you can become un-sickened.