Spekulatius

The MXN.USD currency pair trades like an equity nowadays. +/- 4% Swings some days. https://www.xe.com/currencycharts/?from=USD&to=MXN&view=1M

China is defiantly restarting their economic engine, but who going to buy there stuff when the rest of the world is in lockdown. It would be kind of ironic if this calamity starting out in China and hitting it hard would actually show their resiliency while the rest of the world (ex Japan, Korea, Singapore) tumbled into lockdown that it can’t get out of. may not exactly play out like this, but who knows? Most of the off patent medication consumed in the US is made China and India nowadays.

Smoking kills even faster. The upside for PM and MO is that people may care less.

LOL: https://twitter.com/loudobbs/status/1240421216692961284?s=21

Why? What exactly did they do wrong? Let’s jack up the Capex on all of these companies so the already razor thin margins in the airline industry tighten even more and increase prices putting air travel back out of reach for the average American. The issue is 2008-09 is still fresh in many people's minds. Lots of ordinary people lost everything in the housing crash. Lots of big corporations got bailed out. Same thing looks to be happening again. Warren feels the scale is tipped too much one way. Lots of voters agree with her. I don’t disagree that lending should be sparingly and stringent. But you cross a line when you start mandating wages etc. There are simply better ways to structure this. They would be mandating wages if they take the offer. They don't have to take the offer. That's fair. The executives have "compensation consultants" to help them make more. Employees don't have that. You have to level the playing field. That’s not leveling the playing field. That’s straight up intervention and beyond. The business was fine before the pandemic. If you want to say “keep more cash on hand because next time you’re not getting a bailout” fine. Are you going to make that same mandate for every small business across the country? Ridiculous. A bailout is Intervention to begin with. I actually think the management should be booted in many cases. Heads on sticks do serve a purpose for a better future. #skininthegame. I don’t think buybacks are problem, the problem is that they are overused. The classical examples are ASL and BA which both de-equitized their company with massive buybacks, leveraging their balance sheet and in BA case both their balance sheet and their supply chain.

It seems likes Great Depression, but we had sub $10/brl (might have been as low as $8 ) for a brief time in 1998 and it wasn’t a Depression. https://www.macrotrends.net/1369/crude-oil-price-history-chart

It looks to me like airlines, hotels, restaurants, cruise industry, travel industry, Boeing are all essentially bankrupt as of today. Most will not survive with no revenue if we do a soft lockdown that next 2-3 months. We know the government is going to try and bail some out. That is a tough thing for an investor to figure out (who the winners and losers are going to be). Didn’t work great for bank investors in 2008 (BAC and C); the companies survived but shareholders had their head handed to themselves. Shadow banking system might be the next shoe to fall... overleveraged companies. Oil and gas industry... Looks to me like their might be a real bifurcation in the market. A stock pickers market. 30% of companies weather the storm and 70% get shit kicked. Not great for ETF holders. Private equity would be my guess as a casualty. Another thing I noticed - treasuries were very weak today and interest rates have shot up. That rarely happens in such a down market. Is the financial system getting squeaky? If treasuries yields would explode upwards it would be game over, imo.

Also bought back some beloved TRV @$77 and change. Second bid did not hit unfortunately. Sold this yesterday into the surge at close for more than $96. I call this type of market “Nantucket Sleighrides”. Nothing makes sense any more until it does. Also got a bit more FOX. People still watch TV, I think.

That’s a solution. The problem with so many opportunities is decision paralysis.

Shutting down the US for 30 days - I guess he also means the stock market? Did he get a margin call?

Trading like a devil on steroids is the only thing that works now. BJ is up like almost 50% and their financials don’t even look that great. However, I don’t think they have to worry about renewals of their store leases all that much.

A bit more than 35% roughly. Hard to tell, because the equity part goes down so fast.

WMB is mostly demand driven as far as Transco and Northwest pipes are concerned . I think that’s about 55% of their operating earnings. The iffy part is the G&P in the Marcellus and Wyoming that are feeding in Transco and Northwest respectively. A lot of NG producers there are close to bankruptcy, but shutting of NG that is produced as byproduct of crude production might actually help them. In any case, even if producers go down, the demand for NG is still there, minus some from LNG facilities and such perhaps.

This crash is certainly faster. As far as worse, I guess we will see.

Added a bit of RHM.DE. I liked it at ~70€, so it ought to be a good buy at 43€ and change.

Great idea. I would love for Trump to be “sheltered in place”. The sooner the better :-) Yes, with an orange suit to match his skin color.

It’s not a bad idea because to the best of my limited knowledge, the companies LT prospect won’t be impaired by the Covid-19 although short term earnings may suffer. I just don’t think the price is all that attractive. this thing hasn’t even seen its late 2018 lows yet and thr prospect are way worse than they were back then. Still being reasonably sure of no lasting impairment is worth something. We will see a lot of stocks going to zero in the next 12 month.

Sold my TRV into the late surge yesterday - trade was flat. Sold WAB at smallish loss.

Not a 100 bagger, but I like PINS. Next revenue numbers may be bad, but I think user engagement will increase. They have plenty cash and I like management.

Germany has been late to the game , partly because health decisions are made by states, but the Hammer came down this weekend. Based on what I am hearing (partly from my parents) compliance is pretty good also there is a lot of bitching by some. So far e have been ~7k cases, but the hospital system is holding up and there are few death so so. I think Italy hit the skids once they were at 10k cases, but I think Germany has more capacity (larger Population size too), so with a little luck it can avert disaster. It’s about 1 week behind Italy in terms of time scale. * Edit - 8K cases.

This is incorrect, and dangerous thinking. It is true: accurate information is a critical factor, but it is not possible for humans to obtain such early in these viral outbreaks. The pandemic response is warranted - the precautionary principle is the only guide that would ensure the survival of the species. In these situations, you don't need accurate knowledge of the probabilities in order to know what to do. Our emotions and stress are wiser guide than our intelligence in deciding how to react. Strongly agree with this. That's how the precautionary principle works. When there is wide uncertainty with a lot at stake, you err on the side of taking things seriously and overreacting. I would have thought more people on this board would be fans of the margin of safety, but ¯\_(ツ)_/¯ By the way, I haven't been paying attention to the US election. Did Andrew Yang win? I hear the US Gov't is handing out cash now. Yes Andrew Young (UBI), Liz Warren (student loan interest rates forgiven) won, Bernie (Medicare for all) is next. It’s free for all, Airlines, Cruise lines are already fed in the soup line. Shale and Energy is begging. I guess the lobbyists for all the industries are working overtime. Clearly, we have an extraordinary economic situation, but it is still surprising to see much more government intervention than in countries that are called socialist here. I’d be more in favor of something that helps individuals, if we have learned anything from the GFC it should have been that.

ZIRP is very sticky and will not be over in 6 or 12 month. I think it’s more like a one way road.

I hear bats make good eating. Taste like chicken. I’d probably go for squirrels first. I do have a lot of bats flying around my house in warm summer evenings, but I think hunting them would require a shotgun with a night scope. One acquaintance from our town told me that gun and ammo are sold out. I guess Dick’s sporting is missing out on some revenues.

This is incorrect, and dangerous thinking. It is true: accurate information is a critical factor, but it is not possible for humans to obtain such early in these viral outbreaks. The pandemic response is warranted - the precautionary principle is the only guide that would ensure the survival of the species. In these situations, you don't need accurate knowledge of the probabilities in order to know what to do. Our emotions and stress are wiser guide than our intelligence in deciding how to react. I agree. There is definitely a chance that we are overreacting , but in the absence of good information, what is the alternative? Personally, I think we are probably under reacting to the changes as a whole. There are large parts of the population that act as if nothing has happened. I have in my personal circle (work colleagues, neighbors) a lot of folks who are totally misinformed and totally underestimate the severity of the situation, both in terms of the epidemics as well as the economic consequences. I actually think that the latter one is what is going to take much more time. I live and work in a pretty rural area, so that perhaps why. Other than supermarket shelves being empty, people here have not seen much change yet. Even my wife working at hospitals noticed so far that it is quite (quieter than usual, because they moved many patient out to make space). I am sure this will change quickly. If you like anecdotes, We have acquaintances who went shopping for a truck this weekend in Boston. I also had a colleague coming in this AM he believed there are only 400 infections in the US. he was surprised when I told him that this is probably the official number for MA alone today. I think the collective group here is aware that the Titanic hit an iceberg, but a lot of people believe this is actually all but media hysteria, or just don’t care about the news.

Seems like a good low risk bet, I wouldn’t put too much into forward multiples, as they sure will come down though. I do agree that V and MA are probably the quickest to bounce back.