ERICOPOLY

No joke: https://twitter.com/realDonaldTrump/status/446461592029630464

Last year, it is estimated that 38,800 died in the US from auto crashes, and I'm guessing that the average life is cut short by 30-40 yrs in a car crash. So I guess that automobile crashes cost the US population 1,164,000 - 1,552,000 years of life annually. In terms of years of life lost, that is equal to losing 582,000 to 776,000 lives to COVID-19, assuming it cuts short the average life of it's victims by 2 years.

Yep. Did anyone ever expect to see FFH with a 4% dividend yield? SJ At $290 USD this is late 2007 prices! Did the last 12-13 years really happen? Honestly, some days it feels like Back to the Future. Professor, fire up the DeLoreon because some bad investments and poor liquidity are coming back to roost... SJ You'll know it when they move to list on the NYSE.

Yep. Did anyone ever expect to see FFH with a 4% dividend yield? SJ At $290 USD this is late 2007 prices! Did the last 12-13 years really happen?

Testing? https://www.nytimes.com/2020/03/19/nyregion/coronavirus-new-york-update.html A jump in testing finds a spike in new cases. A few days ago, New York State was testing only a few hundred people a day for coronavirus. On Wednesday night, Gov. Andrew M. Cuomo said, the state processed the tests of 7,584 people.

China says no new cases today. Is this true? They recently expelled US journalists. Faced with 40% plunge in GDP, are they telling the truth or are they trying to calm the US down?

If you are doing a DCF, 2020 GDP is irrelevant. Whether it is a 30% drawdown or a 50% drawdown is unrelated to fundamentals. Nobody can time the bottom. AIG and C still had future earnings ahead yet the common was all but wiped out. This is what people fear on a grand scale (the Great Depression II scenario). In which case it's not as simple as the DCF and 2020 GDP scenario.

If you bought AXP at $40 in September 2008, your long-run returns are meh. The idea we can all time the bottom is quite overrated. I'd rather buy earnings I have some ability to underwrite then to gamble at the casino. This is why I have bought at-the-money calls (enough to be fully invested were they exercised). I don't own any common (which is calling the bottom). If it drops a lot more, I get more at-the-money calls.

Retail wasn't all of a sudden busy two weeks after the bottom in March 2009 either, but a large cap like AXP was at $10 in March 2009 and $20 a month later. There was no economic report that caused it. It doubled yet again that year too, but the second doubling took 5x longer than the first and people all the while were talking about the still-to-come foreclosure waves and Fairfax hedged all of their stock holdings.

IMO, the market is still expecting the government to step in with cash. If the headline today were "Trump and McConnell are listening to the Austrian economists and won't do a fucking thing", then I think the market would drop by a lot.

I am expecting all of those things and the news has been forecasting this the past few days. For example, 20% unemployment warning to Congress.

Interesting. That sounds like they have cash flow problems, which might be the case if their spouse just lost a job. How many people will miss their April rent payment? We don't know yet. I agree.

My wife is in HR at a very large healthcare company. She was almost in tears at the end of the day yesterday because she had conversations all day long with panicked employees who were asking how they can get their cash out of their 401ks. They want to not only liquidate their holdings, they want to pull it from their 401ks. They need cash, they are taking out loans against their 401ks and she had to counsel them that doing so would result in a huge tax hit if they lose their jobs (because if you do not immediately repay the loan at that point, it becomes a taxable withdrawal).

CEO of Wells Fargo bought $5m of WFC.

This is correct IMO. The rate of spread ought to be higher amongst the young as well (think malls, night clubs, and party party party). So it stands to reason there are simply far more cases amongst the young because of rate of spread. And for the reason you point out, we therefore have a lot of serious cases even though they represent a lower proportion of the total unknown number of cases for young people.

A story about the currency trading: https://www.wsj.com/articles/aussie-dollar-at-55-cents-stocks-plunge-in-korea-the-worlds-desperate-for-dollars-11584619914?mod=hp_lead_pos6

Just to pursue the thought experiment, which I consider a no-go ["Don't buy the goose laying golden eggs, when the price of gold is at its top"] : Roche : Controlling shareholders, especially : Without the intent to stir the pot, we all need to stay world citizens. I don't know what you meant by world citizens. I was not implying that testing kits be hoarded only for US citizens. At some point, when there is a bottleneck a government can help by ordering other manufacturers to stop what they are doing and build more of what we need. For example, GM was once ordered to build equipment for war mobilization. The part about buying Roche was just to adequately compensate the owners -- license it, buy it, whatever.

Regarding your last sentence, I remember Markel putting almost no capital to work in 2008 when the market was down. A lesson from 2008/2009 FWIW.

A permanent ban on share buybacks. What is the point? https://www.cnn.com/2020/03/18/business/elizabeth-warren-bailout-buyback-ban/index.html The dividend will just go higher. Returning cash is returning cash.

If you look at the pace of declines in recent days, USB doesn't look like it will be too scary. It was at $55 a month ago and it's at $32 today, but it has largely flattened out for the past week. It's off 50% from it's high. I'm not making a recommendation though.

Does anyone follow the major Australian equities? 58 cent AUD/USD exchange rate now and it was 66 cents last week. AUD was stronger than USD in 2011. A little tailwind from current exchange couldn't hurt when things settle down again.

Roche's tests can give a result 3.5 hrs after the sample gets to the lab. These tests have been FDA approved. I'm very optimistic that we'll follow the S. Korea model. If you were writing a fictional novel, could you have the US Govt buy Roche and order manufacturers to put these things together? What timeline would it take (realistically)? And have the military set up labs? The ONLY reason why we all have to stay home right now is because we don't know who is positive.

And now WWII style manufacturing: https://www.cnn.com/2020/03/18/politics/trump-defense-production-act-coronavirus/index.html

Once we can test a sufficiently large number of people reasonably often, we can all go about our business again. This is a logistical and manufacturing problem, because 6 hr tests are available.

Certainly it is getting right down to business. There is something to be said about ordering all consumers to literally stay home at the same time.