quote:

Originally posted by bald1:
I certainly don't think it is going to take 18 months, as some "experts" have suggested, to return to record high levels again thankfully!

I think market analysts are still clinging to historic trends. We’ve been hearing about the “overdue correction” for two years. Personally, I believe the market is a different animal with the Trump economy, and not subject to all the old rules. I note that some are saying the virus was an excuse for a correction, I haven’t accepted that.

quote:

Originally posted by Kevbo:
Largest one day increase in history?



Bubbatime will be by shortly to tell us we are burning money and it’s headed for 12000

No no no. Worse than that. Headed for collapse!

Think it is down now - wait till Bernie gets elected

I don’t think today was a dead cat bounce. I think the ‘news’ indicating that it might be burning itself out in China is probably wading some fears on the supply chain interruptions.

But what are the futures looking like for tomorrow?

Today's bump was the market reacting to indications that the Federal Reserve will lower interest rates at its next meeting. It's a clear sign that the Fed is committed to supporting the economy even as it reacts to global economic condtions and the effects of the coronavirus pandemic.

Have you ever noticed that there is ALWAYS some sort of explanation as to why the market went up or down. I am convinced after many years that economists stay employed by coming up with whatever explanation will do at the moment. I recall the stock market correctly predicted ten of the last six recessions.

quote:

Originally posted by ZSMICHAEL:
Have you ever noticed that there is ALWAYS some sort of explanation as to why the market went up or down. I am convinced after many years that economists stay employed by coming up with whatever explanation will do at the moment. I recall the stock market correctly predicted ten of the last six recessions.

Well, it's like anything, the big movers in the stock market are in the know......the Warren Buffett's and other large fund managers, know all of the big business owners and hear through the grapevine far sooner than any of us, if companies are going to have issues with raw materials, etc. I know a guy that makes a living as one of the largest soybean traders in the world, he can tell what the soybean market is doing just by various little details he studies......rainfall in a certain area......average temperature in that area.....and on and on.

It's just like the head mechanic at a large Ford dealer is going to know if the new Ford F350 has some inherent issue with a certain part that fails too early etc...….they see it first hand and have a direct number to corporate.

futures for all three indices are positive for tomorrow at the open

let see how it goes

quote:

Originally posted by jimmy123x:
Why wait???? SELL SHORT NOW, then buy back when it hits the bottom, then buy your own shares.

Okay, if that is your thing. The thing that is a bit of a pain about options is that you have to be right not only about the direction, but also the timing. Of course, there is a big difference between selling calls on shares that you own and a naked short. With a covered call (selling short shares you own), if your crystal ball is wrong, you can deliver the shares and miss out on some upside. With a naked short (selling short shares you don't own), your losses can get *really* ugly when you have to go out and buy the shares at market to sell at the price of the calls you sold. If you want to play with options, knock yourself out. I've made those mistakes years ago and I'll stick primarily with equities, debt, and cash.

I'm buying index ETF's.
Low fees and passively managed.

quote:

Originally posted by trapper189:

After a rate cut, it's still selling off this morning.

That dead cat bounce is looking probable.

Well, let's face it. Even if the virus doesn't get any worse, it's still effecting the global economy pretty decently. Perhaps like 9/11 did. The entire travel sector is taking a huge hit: airlines, cruise lines,hotels, rental cars etc. A lot of people are spending their money stocking up on water, diaphers, food, etc. which they'll mostly use anyways in the near future and throw some of it out, but they're not buying a new tv or phone. People are cancelling vacations. Some people are not even going out to restaurants and things of that nature in US cities that already have cases. This will go on until we see a bottom for the virus, either a vaccine or we fully understand it or it turns out to be no worse than the average flu or it disappears......MY gut level feeling is in a few months when it warms up, it will disappear just like the flu does......until next year or never.

Here's just 1 example that I know of and it effects me personally. 1 yacht I manage is owned by Guatamalans, we've had a 12 day Bahamas trip scheduled for April 1-11th for 3 months now for 6 people on a 66' yacht they own that stays here. They usually fly in a few days early and buy electronics and personal items at stores and then their own groceries. If there are even 500-1000 cases in South Florida of the virus they'll cancel and this is how it effects the economy and what they would spend on this trip:
U.S. electronics stores/mall $10,000
Flights $6000
rental car $250
U.S. restaurants $2000
US grocery stores $4000
Marina's + food in Bahamas $8000
Fuel Bahamas $ 7000
Bahamas customs $450
Boat rental $ 2000
U.S. Crew: $9000
Fuel U.S. $3000

That's just if 1 person cancels a 12 day trip to the Bahamas with 6 people. Imagine how many other yacht owners in the yacht capital of the world will cancel travel. It directly effects me and the mate and it's great income that we both lose forever as well as everyone else in that supply chain if they cancel. Sure, if they cancel, they'll do a trip later after the virus subsides BUT, they would've done the later trip anyways, so it's lost money from Guatamala that we won't spend in the U.S. economy.

The emergency rate cut seems to have had a reverse effect. Investors are saying, "Well if the Fed thought an emergency action was necessary, maybe this coronavirus thing is more serious than I thought". Add to that the market had already factored in a half-percentage cut mid-Month (when the FRB has its next scheduled meeting).

It was probably the right action, but the wrong timing.

I have a bunch of flights and trips planned in the next few months, both international and national including a trip to Disney World in April, and the idea of canceling any of them isn't even on my radar.

Perhaps all this silly overreaction will be a good thing. Maybe the crowds at Disney World will be kept at a minimum...

Given that no ships are leaving China and likely won't until at least another month consider the implications and not just electronics. Ikea furniture, I stopped there yesterday on the way back from Pittsburgh and they were out of the cheap, basic white, kitchen wall cabinets that I wanted for my shop.
Most auto windshields come from China as well as a heck oof a lot of products used in home building such as plumbing fittings, fixtures, lighting, window latches, flooring, wiring components, etc.

My friend's daughter is the designer for a large clothing seller (I believe Gap) and they have to have the fabric samples from China by early February in order to select and place their huge order by mid February (at the absolute latest) for the thousands of garments they want made from each selected fabric for the Fall season. China needs this time to manufacture the fabrics which then must be sent to other countries to me made into the clothing. During this time their catalogs and websites are made up for Summer release with the Fall season's styles and colors. As of last week they hadn't even got the samples so it's too late, she has no idea how they will have any clothing for the Fall season.

So even if the Corona outbreak gets over right now, profits for thousands of business's, builders, and manufacturers through Q4 are already in the tank.

Part of the issue is fear and part has to be lack of trust. The ability to trust whatever and whomever is putting out information is at an all time low.

quote:

So even if the Corona outbreak gets over right now, profits for thousands of business's, builders, and manufacturers through Q4 are already in the tank.

Sucks, but that's what happens when you put all of your eggs in Chinese baskets.

I hope Walmart and Amazon don't suffer.........

quote:

Originally posted by a1abdj:
Sucks, but that's what happens when you put all of your eggs in Chinese baskets.

Perhaps a silver lining would be the incentive for companies to stop buying all their components and finished goods from them to save a few pennies.

Unfortunately this Black Swan has just been born.