Real World Anecdotes

[Guest]

I'm part owner in a company selling custom built websites. I regularly speak with Joe public about their finances.

I speak with about 5-10 new people every day from around the country.

 

Every third person I speak with has lost their job or been furloughed. Half of them have stopped paying some of their bills, credit cards go first. Many are seeking unemployment but are so broke the gap in income will hurt them badly. People are pulling all or some money out of retirement accounts. In general, those who needs support are confused as to what they will receive and when or how to apply.

 

Many are only a month or two away from missing mortgage payments.

 

I usually show people how to do balance transfers with credit cards to get 0% for 15 plus months, the credit card companies aren't approving new applications anymore, except for perfect credit. I haven't heard from anyone that credit limits are being reduced yet like in 09 however inactive cards are being cancelled en masse.

 

Surprisingly, those working that are 60 plus years old think they will be going back to work by May.

 

The leads we buy as a company are not available in the same quantity and the quality is lower. Generated online.

 

That's interesting. From what i read a lot of lower-income people losing their jobs right now, will actually have more money coming in than before (combination of unemployment and the check from Mnuchin). How fast do you get an unemployment check after you file in the US. There might be some cash flow mismatch, but my impression was that for a couple of months most people will be able to scrape by.

 

Supposedly (don't know how accurate it is) but 40% of Americans can't come up with $400 in an emergency. I guess they can try to scrape by on credit cards...but that seems kinda pointless long term.

[rb]

That's interesting. From what i read a lot of lower-income people losing their jobs right now, will actually have more money coming in than before (combination of unemployment and the check from Mnuchin). How fast do you get an unemployment check after you file in the US. There might be some cash flow mismatch, but my impression was that for a couple of months most people will be able to scrape by.

In the bill it's right away. But in reality they're saying that it's gonna be a couple of weeks until you get your cheque. Then there's also the fact that the states can't process the volume of applications fast enough. So maybe add another week or two depending on the state.

[Spekulatius]

I'm part owner in a company selling custom built websites. I regularly speak with Joe public about their finances.

I speak with about 5-10 new people every day from around the country.

 

Every third person I speak with has lost their job or been furloughed. Half of them have stopped paying some of their bills, credit cards go first. Many are seeking unemployment but are so broke the gap in income will hurt them badly. People are pulling all or some money out of retirement accounts. In general, those who needs support are confused as to what they will receive and when or how to apply.

 

Many are only a month or two away from missing mortgage payments.

 

I usually show people how to do balance transfers with credit cards to get 0% for 15 plus months, the credit card companies aren't approving new applications anymore, except for perfect credit. I haven't heard from anyone that credit limits are being reduced yet like in 09 however inactive cards are being cancelled en masse.

 

Surprisingly, those working that are 60 plus years old think they will be going back to work by May.

 

The leads we buy as a company are not available in the same quantity and the quality is lower. Generated online.

 

That's interesting. From what i read a lot of lower-income people losing their jobs right now, will actually have more money coming in than before (combination of unemployment and the check from Mnuchin). How fast do you get an unemployment check after you file in the US. There might be some cash flow mismatch, but my impression was that for a couple of months most people will be able to scrape by.

 

It could be a other wrinkle they this crisis leads to a further destruction of the middle class. Let’s say you have a couple earning 200k/ year in 2019, you get zero Covid-19 check. 200k is a lot in some parts of the country but not they much in others. If now both lose their jobs, they could be worse off than a low income family actually.

[rb]

It could be a other wrinkle they this crisis leads to a further destruction of the middle class. Let’s say you have a couple earning 200k/ year in 2019, you get zero Covid-19 check. 200k is a lot in some parts of the country but not they much in others. If now both lose their jobs, they could be worse off than a low income family actually.

Yea. But shouldn't those people have some dough to tide them over though this?

 

Plus calling 200k a year households middle class is quite a stretch. No matter the location. Isn't NYC median household income something like 60k?

[Guest]

It could be a other wrinkle they this crisis leads to a further destruction of the middle class. Let’s say you have a couple earning 200k/ year in 2019, you get zero Covid-19 check. 200k is a lot in some parts of the country but not they much in others. If now both lose their jobs, they could be worse off than a low income family actually.

Yea. But shouldn't those people have some dough to tide them over though this?

 

Plus calling 200k a year households middle class is quite a stretch. No matter the location. Isn't NYC median household income something like 60k?

 

haha yeah $200,000 puts you almost at the top 8%.

[Gregmal]

It could be a other wrinkle they this crisis leads to a further destruction of the middle class. Let’s say you have a couple earning 200k/ year in 2019, you get zero Covid-19 check. 200k is a lot in some parts of the country but not they much in others. If now both lose their jobs, they could be worse off than a low income family actually.

Yea. But shouldn't those people have some dough to tide them over though this?

 

Plus calling 200k a year households middle class is quite a stretch. No matter the location. Isn't NYC median household income something like 60k?

 

Well if you eliminate all the homeless people its probably much higher...j/k

 

I do know plenty of families who would argue otherwise. I consider them dumbasses but a few particularly. Husband and wife make combined north of $300k. Nanny for the kids, Porsche and Escalade cars, Vacations and Eurotrips multiple times a year, dinner at Le Bernardin once a week... if checks stopped tomorrow they'd be belly up by May 1. Big part of American culture has become living large and having things.

[orthopa]

I'm part owner in a company selling custom built websites. I regularly speak with Joe public about their finances.

I speak with about 5-10 new people every day from around the country.

 

Every third person I speak with has lost their job or been furloughed. Half of them have stopped paying some of their bills, credit cards go first. Many are seeking unemployment but are so broke the gap in income will hurt them badly. People are pulling all or some money out of retirement accounts. In general, those who needs support are confused as to what they will receive and when or how to apply.

 

Many are only a month or two away from missing mortgage payments.

 

I usually show people how to do balance transfers with credit cards to get 0% for 15 plus months, the credit card companies aren't approving new applications anymore, except for perfect credit. I haven't heard from anyone that credit limits are being reduced yet like in 09 however inactive cards are being cancelled en masse.

 

Surprisingly, those working that are 60 plus years old think they will be going back to work by May.

 

The leads we buy as a company are not available in the same quantity and the quality is lower. Generated online.

 

That's interesting. From what i read a lot of lower-income people losing their jobs right now, will actually have more money coming in than before (combination of unemployment and the check from Mnuchin). How fast do you get an unemployment check after you file in the US. There might be some cash flow mismatch, but my impression was that for a couple of months most people will be able to scrape by.

 

Supposedly (don't know how accurate it is) but 40% of Americans can't come up with $400 in an emergency. I guess they can try to scrape by on credit cards...but that seems kinda pointless long term.

 

Hopefully with them spending less (can go out, cant drink, cant buy shit) for a month or two the extra money gets them through.

[Guest]

I'm part owner in a company selling custom built websites. I regularly speak with Joe public about their finances.

I speak with about 5-10 new people every day from around the country.

 

Every third person I speak with has lost their job or been furloughed. Half of them have stopped paying some of their bills, credit cards go first. Many are seeking unemployment but are so broke the gap in income will hurt them badly. People are pulling all or some money out of retirement accounts. In general, those who needs support are confused as to what they will receive and when or how to apply.

 

Many are only a month or two away from missing mortgage payments.

 

I usually show people how to do balance transfers with credit cards to get 0% for 15 plus months, the credit card companies aren't approving new applications anymore, except for perfect credit. I haven't heard from anyone that credit limits are being reduced yet like in 09 however inactive cards are being cancelled en masse.

 

Surprisingly, those working that are 60 plus years old think they will be going back to work by May.

 

The leads we buy as a company are not available in the same quantity and the quality is lower. Generated online.

 

That's interesting. From what i read a lot of lower-income people losing their jobs right now, will actually have more money coming in than before (combination of unemployment and the check from Mnuchin). How fast do you get an unemployment check after you file in the US. There might be some cash flow mismatch, but my impression was that for a couple of months most people will be able to scrape by.

 

Supposedly (don't know how accurate it is) but 40% of Americans can't come up with $400 in an emergency. I guess they can try to scrape by on credit cards...but that seems kinda pointless long term.

 

Hopefully with them spending less (can go out, cant drink, cant buy shit) for a month or two the extra money gets them through.

 

Perhaps. I've learned, though, that people tend to value money they've earned more than money they're given.

[Spekulatius]

It could be a other wrinkle they this crisis leads to a further destruction of the middle class. Let’s say you have a couple earning 200k/ year in 2019, you get zero Covid-19 check. 200k is a lot in some parts of the country but not they much in others. If now both lose their jobs, they could be worse off than a low income family actually.

Yea. But shouldn't those people have some dough to tide them over though this?

 

Plus calling 200k a year households middle class is quite a stretch. No matter the location. Isn't NYC median household income something like 60k?

 

They should, but will they?  It also depends how long this lasts. If it lasts 6 month, most of this cohort will be out of cash for sure. point being, they could be worse of then low income from a cash flow perspective for a long time.

[Spekulatius]

I'm part owner in a company selling custom built websites. I regularly speak with Joe public about their finances.

I speak with about 5-10 new people every day from around the country.

 

Every third person I speak with has lost their job or been furloughed. Half of them have stopped paying some of their bills, credit cards go first. Many are seeking unemployment but are so broke the gap in income will hurt them badly. People are pulling all or some money out of retirement accounts. In general, those who needs support are confused as to what they will receive and when or how to apply.

 

Many are only a month or two away from missing mortgage payments.

 

I usually show people how to do balance transfers with credit cards to get 0% for 15 plus months, the credit card companies aren't approving new applications anymore, except for perfect credit. I haven't heard from anyone that credit limits are being reduced yet like in 09 however inactive cards are being cancelled en masse.

 

Surprisingly, those working that are 60 plus years old think they will be going back to work by May.

 

The leads we buy as a company are not available in the same quantity and the quality is lower. Generated online.

 

That's interesting. From what i read a lot of lower-income people losing their jobs right now, will actually have more money coming in than before (combination of unemployment and the check from Mnuchin). How fast do you get an unemployment check after you file in the US. There might be some cash flow mismatch, but my impression was that for a couple of months most people will be able to scrape by.

 

Supposedly (don't know how accurate it is) but 40% of Americans can't come up with $400 in an emergency. I guess they can try to scrape by on credit cards...but that seems kinda pointless long term.

 

Hopefully with them spending less (can go out, cant drink, cant buy shit) for a month or two the extra money gets them through.

 

Who says we can’t drink?

[Jurgis]

It could be a other wrinkle they this crisis leads to a further destruction of the middle class. Let’s say you have a couple earning 200k/ year in 2019, you get zero Covid-19 check. 200k is a lot in some parts of the country but not they much in others. If now both lose their jobs, they could be worse off than a low income family actually.

Yea. But shouldn't those people have some dough to tide them over though this?

 

Plus calling 200k a year households middle class is quite a stretch. No matter the location. Isn't NYC median household income something like 60k?

 

Yeah, 200k household middle class? LOL.

It's actually in top 9%: https://dqydj.com/average-median-top-household-income-percentiles/

 

I find it quite funny - and sad - when most of my techie colleagues behave as if they are middle class and not somewhere in the 80-90%+.

 

[LC]

It’s because the wealth line has become so steep that 200k is closer to middle class than wealthy.

[John Hjorth]

Hopefully with them spending less (can go out, cant drink, cant buy shit) for a month or two the extra money gets them through.

Who says we can’t drink?

 

You gents are killing me!

 

Life is too short for cheap beer and wine.

To be a realist one has to believe in miracles.

 

Our household right now - short version - consists of [2 x #metooCOVID-19?] - we bottomed out on Saturday March 14^th 2020, both ill. Forced to switching to digital retailing [we chose nemlig.com] because of no access to testing as of now. She makes lists of what to order - I type them. At every order - if it's not already on the list - I add wine. Now she has started asking me : "Why are you ordering all that wine?" -I guess it's an unconscious mechanism. [ : - ) ]

[Uccmal]

Hopefully with them spending less (can go out, cant drink, cant buy shit) for a month or two the extra money gets them through.

Who says we can’t drink?

 

You gents are killing me!

 

Life is too short for cheap beer and wine.

To be a realist one has to believe in miracles.

 

Our household right now - short version - consists of [2 x #metooCOVID-19?] - we bottomed out on Saturday March 14^th 2020, both ill. Forced to switching to digital retailing [we chose nemlig.com] because of no access to testing as of now. She makes lists of what to order - I type them. At every order - if it's not already on the list - I add wine. Now she has started asking me : "Why are you ordering all that wine?" -I guess it's an unconscious mechanism. [ : - ) ]

 

To be clear John.  You think you were sick with Covid 19.  Sounds like you are okay. 

 

I am thinking my whole family was exposed but we cant know for sure.  We flew to Southern Mexico in later February for a week (no reported cases there) came home, and my 10 year old daughter got sick.  It was definitely a flu like thing with chills/fever fatigue for a few days.  The rest of us were fine although both my Wife and I felt off for a day or two.  The little one recovered, and the rest of us are fine.  I dont think Mexico was the source, but rather the act of travelling was the source of whatever it was.  Pearson Airport on TO was still a cesspool. 

 

Back on topic:

 

- Everyone I know is at home except for a few health care workers. 

 

-  Our house cleaner works at a grocery store the rest of her time and is working full weeks.  No more house cleaning, but coercing and bribing the kids is working. 

 

- My home reno project is grinding to a halt.  It is becoming impossible to work with the kids at home, and with curbside ordering for supplies in effect.  Eventually I have to buy (and actually see) parts for the next phase of the job (a powder room).  It will get mothballed until next fall.  Its spring and the biggest time of year for the "other retailers":  HD, Lowes, Nurseries, Home improvement, landscapers, outdoor reno workers,etc, and they are not selling.  Lineups for non necessities and online ordering are killing their sales during their Christmas season. 

 

- Online ordering starting to show cracks.  Tried to order a couple of books for my daughter and Amazon Prime had a one month wait.  Chapters/Indigo promised 3 days but the order is nowhere to be seen. 

 

-  Online food orders need to be made 3 weeks out. 

 

I am sure there is more. 

 

- Saving huge money from cancelled travel and wife working from home.  Not happy about either outcome. 

 

- Temporarily down around 700k in market losses.  Not overly uptight about this.  I wont sell anything so it doesn't matter.  The companies I hold will all be thrivers, after this. 

 

-  In general people are not spending in my area and among my friends.  These people can afford it, there is just nothing to spend on.  Observationally, there must be huge negative spinoffs into the general economy, hence my basket of puts. 

[Spekulatius]

Hopefully with them spending less (can go out, cant drink, cant buy shit) for a month or two the extra money gets them through.

Who says we can’t drink?

 

You gents are killing me!

 

Life is too short for cheap beer and wine.

To be a realist one has to believe in miracles.

 

Our household right now - short version - consists of [2 x #metooCOVID-19?] - we bottomed out on Saturday March 14^th 2020, both ill. Forced to switching to digital retailing [we chose nemlig.com] because of no access to testing as of now. She makes lists of what to order - I type them. At every order - if it's not already on the list - I add wine. Now she has started asking me : "Why are you ordering all that wine?" -I guess it's an unconscious mechanism. [ : - ) ]

 

I hope you are doing OK with whatever bug you caught. It seems that the first line treatment is actually isotonic/sports drink, but I think adding a bit wine to the mix doesn’t hurt. One of the first thing I did was stocking on up wine, beer etc when the crisis got evident. I also have a subscription for a winery club that keeps the supplies coming. I have changed my signature  accordingly a while ago.

 

 

Yes, 200k  is far above middle class Statistically, but depending on where you live, it doesn’t feel so. Median HH income in the town I live is ~140k and most towns around me are similar. Then there are other cities not so far where median HH income is 1/3 around ~50k. I would say that if the unemployment gets as bad as projected, this cohort could get hit badly too in terms of income loss and most probably haven’t 6 month of cash expenses, but that’s just my guess. We will probably see defaults in this group as well, because I don’t think this crisis is going to be over quickly.

[KJP]

I'm part owner in a company selling custom built websites. I regularly speak with Joe public about their finances.

I speak with about 5-10 new people every day from around the country.

 

Every third person I speak with has lost their job or been furloughed. Half of them have stopped paying some of their bills, credit cards go first. Many are seeking unemployment but are so broke the gap in income will hurt them badly. People are pulling all or some money out of retirement accounts. In general, those who needs support are confused as to what they will receive and when or how to apply.

 

Many are only a month or two away from missing mortgage payments.

 

I usually show people how to do balance transfers with credit cards to get 0% for 15 plus months, the credit card companies aren't approving new applications anymore, except for perfect credit. I haven't heard from anyone that credit limits are being reduced yet like in 09 however inactive cards are being cancelled en masse.

 

Surprisingly, those working that are 60 plus years old think they will be going back to work by May.

 

The leads we buy as a company are not available in the same quantity and the quality is lower. Generated online.

 

That's interesting. From what i read a lot of lower-income people losing their jobs right now, will actually have more money coming in than before (combination of unemployment and the check from Mnuchin). How fast do you get an unemployment check after you file in the US. There might be some cash flow mismatch, but my impression was that for a couple of months most people will be able to scrape by.

 

It could be a other wrinkle they this crisis leads to a further destruction of the middle class. Let’s say you have a couple earning 200k/ year in 2019, you get zero Covid-19 check. 200k is a lot in some parts of the country but not they much in others. If now both lose their jobs, they could be worse off than a low income family actually.

 

The group you're describing is also one of the groups most likely to be forced to sell investments at the bottom, tap retirement accounts, etc.  That won't help their long-term net worth.

[meiroy]

 

Wine is being sold like it's Christmas.

 

 

[pbi]

Am located in HK so the following is pretty specific to it. 

 

Have seen/heard on the grapevine:

- Chinese factories (the ones we work with anyway) are back online.

- Supply chain issues now seem to be related to border control rather than production.

- Cost of a month in a hotel often cheaper than a month in an apartment.

- Restaurants not noticeably quieter; has become cheaper to eat out as many are offering meal deals to attract customers.

- Supermarkets are now overstocked with the essentials, queues back to normal.

- Over the last few weeks shipping by sea from China to HK has been faster than shipping by road from China to HK.

 

[SharperDingaan]

Supply chains are reacting to Trumps N95 mask ban.

-Calls to re-chart supply chain risk related to the US. The focus is on 2nd and 3rd order impacts, and a first time for many.

-Mostly Grey Rhino's, but a lot of Black Swans as well. Biggest is that the US/CAN border remains open.

-Main take-away is that patent protection really means squat. 

 

SD

 

[BG2008]

Am located in HK so the following is pretty specific to it. 

 

Have seen/heard on the grapevine:

- Chinese factories (the ones we work with anyway) are back online.

- Supply chain issues now seem to be related to border control rather than production.

- Cost of a month in a hotel often cheaper than a month in an apartment.

- Restaurants not noticeably quieter; has become cheaper to eat out as many are offering meal deals to attract customers.

- Supermarkets are now overstocked with the essentials, queues back to normal.

- Over the last few weeks shipping by sea from China to HK has been faster than shipping by road from China to HK.

 

Thank you

[cubsfan]

Am located in HK so the following is pretty specific to it. 

 

Have seen/heard on the grapevine:

- Chinese factories (the ones we work with anyway) are back online.

- Supply chain issues now seem to be related to border control rather than production.

- Cost of a month in a hotel often cheaper than a month in an apartment.

- Restaurants not noticeably quieter; has become cheaper to eat out as many are offering meal deals to attract customers.

- Supermarkets are now overstocked with the essentials, queues back to normal.

- Over the last few weeks shipping by sea from China to HK has been faster than shipping by road from China to HK.

 

Excellent - keep the news coming - good or bad

 

much appreciated !

[spartan]

Here are a few more anecdotes from Toronto:

 

1. I just sold my house a few weeks ago (the closing process has been horrendous - lots of buyer's remorse), and my realtor told me that one of his clients owns what would have been $80 Million in real estate a few months ago. The client called him yesterday and told him to "fire sale" everything because their "scheme doesn't work anymore". According to my realtor, the client is currently entertaining an offer for $60 Million.

 

2. Very close friend of mine operates a coffee roaster business. His dad started it in the mid-1970's. Around $25 Million in annual revenue. Their business is down 90%. They let go of most of their employees and, according to him, can last for one year until they go belly up. (They own the land so no need to worry about rent...but I'm assuming they have debt and will likely have more coming out of this.)

 

3. My dad is a cardiologist and never in my life have I seen him this stressed about finances. He doesn't go to work (no employment income), stays at home (ruminates / lots of phone time), has been seeing his assets go down in value almost every day... he would be helping out in the hospitals but he's 73 years old with pre-existing lung issues...

 

4. A close relative owns a gym in downtown Toronto (now closed). The guy drives a Benz SUV, smokes and drinks excessively, goes to super expensive grocery stores for food, has two kids with another on the way, and lives in a sweet home. I wonder if government cheques will be enough to support that lifestyle... because his business was operating at break-even before this hit.

[cubsfan]

Spartan - these are the real life tragedies that represent "the other side of the coin" - of excessive/unneeded lockdown.

 

It's perhaps MUCH easier for politicians that WON'T lose their jobs and media that WON'T lose their jobs to let this get out

of control - after all - they are still working and won't be hurt.

 

They better get this right.

 

Best to you and your father.

[montizzle]

Spartan - these are the real life tragedies that represent "the other side of the coin" - of excessive/unneeded lockdown.

 

 

Not sure I can compare thousands of deaths to a guy not affording his benz as the same scale of tragedy

[mcliu]

@spartan Thanks for sharing. What was the RE scheme?