how long until S&P500 hits a new high (poll)

[Guest cherzeca]

there are very few cases in US but this may change.  the economic effect of supply change disruption is already here, but it is hard to tell yet how badly earnings will be affected. is this a case of the US not being adversely affected as a matter of public health and the supply change hit to earnings will be moderate, or is it far worse?

[Guest cherzeca]

mackintosh from wsj:  https://www.wsj.com/articles/as-markets-fall-ask-yourself-if-now-is-the-time-to-buy-11582892883

[Fearful Optimism]

There aren't many confirmed cases in the US because not many people have been tested - as of a couple days ago, only 500 were tested.  You will probably see similar exponential growth here as you've seen in South Korea, Italy, etc. I'm in the camp that this is serious and will probably get worse before it gets better. To make matters worse, this isn't really something fiscal or monetary stimulus can solve.

 

Sorry to be a downer but I think new AT highs are a long way off.

[Spekulatius]

The problem aren’t really the death rates or number of new cases, the problem is that the only way to stop this is to essentially shut down large parts of the economy. (Travel, Social Events, Public Transport, Restaurants etc.). This could easily become a 2008 recession. With some luck, it will blow lever at home and we have just have the disputation of the supply chains from China, international demand and most likely a recession in Europe.

 

Overall, we are just back to the prices from October 2019, oh the horror...

[finetrader]

The problem aren’t really the death rates or number of new cases, the problem is that the only way to stop this is to essentially shut down large parts of the economy. (Travel, Social Events, Public Transport, Restaurants etc.). This could easily become a 2008 recession. With some luck, it will blow lever at home and we have just have the disputation of the supply chains from China, international demand and most likely a recession in Europe.

 

Overall, we are just back to the prices from October 2019, oh the horror...

 

+1

Great post

[BG2008]

The problem aren’t really the death rates or number of new cases, the problem is that the only way to stop this is to essentially shut down large parts of the economy. (Travel, Social Events, Public Transport, Restaurants etc.). This could easily become a 2008 recession. With some luck, it will blow lever at home and we have just have the disputation of the supply chains from China, international demand and most likely a recession in Europe.

 

Overall, we are just back to the prices from October 2019, oh the horror...

 

Spek, I think this is very well said.  It's not the death rate.  The moment for me was when Microsoft and Mastercard issued warnings on their revenue guidance.  Mastercard sees economic activities in real time as you, I, and everyone else swipe our cards.  That was my "oh, I suspected and hedged, but this is confirmation" moment.  I bought more hedge.  People keep saying 2% death rate is not much. 

 

Bigger picture, I think Germany is already in a recession. Japan printed a negative 5 or 6% and now they have to deal with Corona Virus. The US only grows GDP by 2%.  Recession is when it goes negative for 2 quarters.  The R word has not reared its head.  But when people start to throw around the word, economic planning and future purchases go down.  Everything has a feedback loop. 

 

Anecdotal observation, restaurants in Flushing Queens have started to suffer.  It's not racist, even the Chinese people are avoiding going out to Dim Sum or dinner.  There is bound to be someone from Wuhan.  Also, rice is out of stock in Chinese supermarkets.  Colorox wipes are out of stock at my local Costco. 

[Guest cherzeca]

see https://www.barrons.com/articles/didnt-sell-before-the-big-plunge-heres-the-good-news-51582941369?mod=hp_DAY_2

 

"Jeffrey DeMaso, director of research for the excellent Independent Adviser for Vanguard Investors newsletter, looked at the 55 days over the past 33 years when the S&P 500 has fallen by 3.5% or more (as in Thursday’s 4.4% plunge). He found that, following 45 of those plunges, Vanguard’s S&P index fund has been up an average of 20% a year later. Not a bad bet."

 

as I write this the poll is evenly split regarding whether there will be a new high before or after a year, and a new high implies a 20% gain from here in a year.  so based upon data rather whether the bat soup is selling in Flatbush, we as a group are about 30% too pessimistic.

[glorysk87]

The problem aren’t really the death rates or number of new cases, the problem is that the only way to stop this is to essentially shut down large parts of the economy. (Travel, Social Events, Public Transport, Restaurants etc.). This could easily become a 2008 recession. With some luck, it will blow lever at home and we have just have the disputation of the supply chains from China, international demand and most likely a recession in Europe.

 

Overall, we are just back to the prices from October 2019, oh the horror...

 

Why do you think it turns into a recession? Leverage at the consumer level isn't particularly high. Corporate leverage remains relatively high, but there's no reason the credit market should close to them, and refinancing is a positive option at the level rates are at. Layer on fed rate cuts and an almost certainly fiscal stimulus globally...

[Guest cherzeca]

another data analysis, this time one month follow on return after a >7% drop in three consecutive trading days (which we had last week)(outside the GFC) :

 

 

in looking at this data, one may wonder why exclude GFC episodes, since that panic may be thought to resemble current covid-19 panic, but I think exclusion is fair since different underlying economic conditions/GFC was sui generis

[Guest cherzeca]

4-8 months wins.

 

were you a winner? (81% of you were not) (I was).

[rkbabang]

I am the 81%

 

I had 1-2years

[deleuze68]

This thread got did not get anywhere near the traction as the "will s&p retest the lows" thread 'cause it just screamed obvious troll.

[Guest cherzeca]

This thread got did not get anywhere near the traction as the "will s&p retest the lows" thread 'cause it just screamed obvious troll.

 

trolling is in the eye of the troller

[RadMan24]

4-8 months wins.

 

were you a winner? (81% of you were not) (I was).

 

Barron's does the annual guessing game on a huge range of predictions - I can't wait to see the results of who won that one this year - still got 4 months to go!

[Liberty]

"Nobody knows anything."

 

-William Goldman

[Guest cherzeca]

I find it amusing that the coronavirus thread has thousands of posts by purported investors (this is an investor board, right?), and this thread has but a few...but this thread was the far more important coronavirus-related thread for an investor to consider at the end of February...again, from an investor point of view.

 

 

[Gregmal]

I find it amusing that the coronavirus thread has thousands of posts by purported investors (this is an investor board, right?), and this thread has but a few...but its was the far more important coronavirus-related  thread for an investor to consider at the end of February, again, from an investor point of view.

 

Yea but what if you hate Trump and just need an outlet?

[fareastwarriors]

I find it amusing that the coronavirus thread has thousands of posts by purported investors (this is an investor board, right?), and this thread has but a few...but this thread was the far more important coronavirus-related thread for an investor to consider at the end of February...again, from an investor point of view.

 

Investing is boring. Just sit and watch everything go UP.

 

[rkbabang]

I find it amusing that the coronavirus thread has thousands of posts by purported investors (this is an investor board, right?), and this thread has but a few...but its was the far more important coronavirus-related  thread for an investor to consider at the end of February, again, from an investor point of view.

 

Yea but what if you hate Trump and just need an outlet?

 

There is an entire politics section for their daily 2 minutes hate.

 

I think it is more likely that this thread asked us to predict the future, which is hard.

 

[Gregmal]

I find it amusing that the coronavirus thread has thousands of posts by purported investors (this is an investor board, right?), and this thread has but a few...but this thread was the far more important coronavirus-related thread for an investor to consider at the end of February...again, from an investor point of view.

 

Investing is boring. Just sit and watch everything go UP.

 

Dude, thats it! Thats why, deep down some of us are drawn to the office REITs! Similar to the old adage, something about the occasional 2 being necessary in order to appreciate the 10s. I will leave out the rest of the analogy for the sake of the children. But now it makes sense. The office REIts are just there to make us appreciate everything else!

[Read the Footnotes]

Who would have predicted at the time of the poll that Biden would be expected to win the November elections and that the forward looking stock market would like that so much?

[Guest cherzeca]

I find it amusing that the coronavirus thread has thousands of posts by purported investors (this is an investor board, right?), and this thread has but a few...but its was the far more important coronavirus-related  thread for an investor to consider at the end of February, again, from an investor point of view.

 

Yea but what if you hate Trump and just need an outlet?

 

There is an entire politics section for their daily 2 minutes hate.

 

I think it is more likely that this thread asked us to predict the future, which is hard.

 

I would think having a view as to future is sort of important for an investor...

[RadMan24]

I find it amusing that the coronavirus thread has thousands of posts by purported investors (this is an investor board, right?), and this thread has but a few...but its was the far more important coronavirus-related  thread for an investor to consider at the end of February, again, from an investor point of view.

 

Yea but what if you hate Trump and just need an outlet?

 

There is an entire politics section for their daily 2 minutes hate.

 

I think it is more likely that this thread asked us to predict the future, which is hard.

 

I would think having a view as to future is sort of important for an investor...

 

It is, but the odds of being right are greater on a micro level, on a consistent basis, than on a macro level.

[rkbabang]

I find it amusing that the coronavirus thread has thousands of posts by purported investors (this is an investor board, right?), and this thread has but a few...but its was the far more important coronavirus-related  thread for an investor to consider at the end of February, again, from an investor point of view.

 

Yea but what if you hate Trump and just need an outlet?

 

There is an entire politics section for their daily 2 minutes hate.

 

I think it is more likely that this thread asked us to predict the future, which is hard.

 

I would think having a view as to future is sort of important for an investor...

 

It's easy to predict that the S&P500 will hit a new all time high than to predict when it will.  It's the precisely when that is the hard part.  If you always know the "when" then you can make a fortune with options.

 

[Guest cherzeca]

I find it amusing that the coronavirus thread has thousands of posts by purported investors (this is an investor board, right?), and this thread has but a few...but its was the far more important coronavirus-related  thread for an investor to consider at the end of February, again, from an investor point of view.

 

Yea but what if you hate Trump and just need an outlet?

 

There is an entire politics section for their daily 2 minutes hate.

 

I think it is more likely that this thread asked us to predict the future, which is hard.

 

I would think having a view as to future is sort of important for an investor...

 

It's easy to predict that the S&P500 will hit a new all time high than to predict when it will.  It's the precisely when that is the hard part.  If you always know the "when" then you can make a fortune with options.

 

agreed, but that was the point of the thread question...make a message board bet on how long the covid market disturbance would last.  I recall a friend after the Dotcom crash saying that nasdaq would never get above 5000 again in our lifetimes...and we are still both alive (and I still remind him that he said that).  so the point of the thread question, and long term investing in general, is to get above the clouds and see what you think the long term forecast is...and there is money to be made when there is stormy weather now but there is reason to believe that this too shall pass soon enough...the soon enough is the key question, which is why I asked it in the thread