mcliu

Why is 5% long-term earnings growth optimistic?

I think you have to shutdown high density areas like big cities. But it probably doesn't make sense to shutdown rural or mainly suburban areas. If people are careful, outbreaks will probably be rare, because no mass transit, lots of space per person, everyone drives, etc.

Everyone in China/Korea/Japan wears mask, clearly helps. We need to adopt these practices.

If you get coronavirus but have recovered. Would you show positive or negative on these tests? Also, would you be immune to the virus?

Not as deadly as originally imagined, but many times deadlier than flu. But because it’s not super deadly, it is also easier to spread.

Just wanted to focus back on the virus and investing. Any thoughts on worst case, base case, best case? Thoughts on market levels that you would buy at and why?

Shouldn't we focus on the curve by region? NY seems to be hit hardest. Washington/California has high caseloads but growth has not increased as dramatically. So it doesn't seem like the entire country is following the same curve. I think Cuomo has a good point, the Federal government should direct resources toward different parts of the country based on their curve & progress.

How would it preserve shareholder capital when those swaps would have pummeled the company the last 2 years when Fairfax's equity investments underperformed so much? It would have been better if the hedges were in place in 2019..

What’s the impact of prior pandemics on the economy?

Wow: Castanza's link: WHO (Jan 14): "Preliminary investigations conducted by the Chinese authorities have found no clear evidence of human-to-human transmission of the novel #coronavirus (2019-nCoV) identified in #Wuhan, #China." Was Trump lying or was he following WHO guidance like the rest of the world? Is every European government also lying? Clearly the outbreak and response is much worse in Europe..

There's reason for optimism. Spanish flu killed 100 million people in the midst of WWI and yet society did not collapse, the world goes on. Plus we have better science and technology today, so things should be better 5 to 10 years from now. Unless this is truly the beginning of the end and we all die.. then all bets are off. Which country are you in and why do think it has a bleak future?

Capacity during non-pandemic times is low to begin with since there’s little demand. But also the entire global supply chain was outsourced to China. China is requisitioning all the masks made in China.. So there’s inadequate domestic industrial capacity to ramp up production.

The WH was warned last year that the country isn't ready for a pandemic. Hopefully after this, people realize the importance of having the right leadership in place. So true. At least DT moved pretty quick with the travel bans. The Liberal government here in Canada was too woke to even travel ban. Even a few weeks ago Trudeau was eating at Chinese restaurants in Scarborough for photo op and to encourage people to eat out. Sad because we’ve experienced the SARS epidemic 15 year ago and still so ill-prepared. Hospitals here are asking for n95 mask donations now.

Hopefully after this, people realize the importance of having domestic manufacturing capacity so we don’t have the whole world trying to source stuff from China.

There’s no way China style lockdown can or should happen here. If you look at archived Chinese social media, they were literally locking people inside their houses. Doors to entire apartments were welded shut. Infected people rounded up and forced into quarantine hotels. Public apology/denunciation for not wearing face masks. Japan, Korea have shown that there’s ways to contain virus without taking away all your rights. You don’t need to lock everyone up, people just need to pay attention and avoid close contact. Face mask and glove wearing should be encouraged. Also, in many ways, we are dealt a better hand in the Canada/US, many of us live in houses in much lower density areas. We also drive our own cars instead of mass transit. There’s also good delivery and internet infrastructure and many can work from home.

To be fair, it's not like any other Western country did a better job. Here in Canada, they've been much slower to act despite having a SARS outbreak 15 years ago. And Europe.. well just look at the #s.

This is their chance to shine. Hope they don’t f it up. I’m selling if they mess this up. ;D

Anyone have a theory on why the curve is so much worse in NYC/New Jersey than Washington/California?

I see the same thing but I don't understand it. How can bond funds and stocks sell of at the same time? One thing is clear, the jig is up for the central banks. https://www.marketwatch.com/story/fed-sets-new-loan-program-designed-to-ease-turmoil-in-money-markets-2020-03-18

Thanks for the enlightenment, clearly you are much smarter and better informed. I’ll just go back to watching the Big Short again to brush up on my finance knowledge. :-X

GFC was a solvency issue. Lehman and Bear and other banks went down because the assets that they held, AAA-rated MBS/CDOs were worth 0 and they had a 5% equity buffer.

What’s a good source for case data by state to track progress?

Don't forget potential for zombie apocalypse.

Wasn't he also saying "Cash is trash" like a week before everything blew up?

Are you saying it's great depression time? :o