Stock Thread (18 Viewers)

[fantasycurse42]

At best, it's not a good look. 

Agreed, I expect people to talk their book, but this was the sleaziest thing I’ve ever seen from a sleazy industry. What a dirt bag!!!

 

[dkp993]

We will needs to me bank insolvency issues to match 2008 I think, hard to imagine Europe getting out of this unscathed.

This crisis if it goes on for much longer will absolutely devastate some industries and small businesses.  The damage will be wide spread and deep.  

 

[cosjobs]

I'll start believing there is some semblance of normal when major sports resume.  Seems like a good enough barometer to me.

Since that is still a big "when" and I am not clear at all on the answer, we have a lot of time to trend downward in the meantime.  

 

I've been trending downward for years

 

[lod001]

He is a POS market manipulator. He is scum in the investment world. I can’t stand the guy. 

x 10

 

[TripItUp]

This crisis if it goes on for much longer will absolutely devastate some industries and small businesses.  The damage will be wide spread and deep.  

no question.   My best guess is we land between 15-20% unemployment and a lot of long term small business devastation.

However, small businesses do not directly correlate to publicly traded stocks and even compete with some of them like Walmart and Amazon.  My comment was regarding publicly traded stocks since that is what I'm most interested in for this thread.

 

[cosjobs]

Vanguard smallcap fund. I put $10K in here about 5 years ago. It was killing at about a 50% gain. Now back to about even. Should I dump it to cash? Looks like the small caps are in for a huge roasting. 

I would, but I'm a proven idiot at predicting the market until Feb.

 

[dkp993]

no question.   My best guess is we land between 15-20% unemployment and a lot of long term small business devastation.

However, small businesses do not directly correlate to publicly traded stocks and even compete with some of them like Walmart and Amazon.  My comment was regarding publicly traded stocks since that is what I'm most interested in for this thread.

 

[BassNBrew]

TZA

DFS

For very different reasons.

Any reason why DFS over SYF?

 

[sporthenry]

We will needs to me bank insolvency issues to match 2008 I think, hard to imagine Europe getting out of this unscathed.

I don't know enough about true small business lending and how that flows through the financial system but I have to imagine recoveries are pretty solid and banks have decent collateral on like a bar loan or one-off restaurant. Seems like it's charge offs for large bankruptcies that hit earnings most. So what worries me is the corporate leverage, direct lending, CLOs, BDCs etc. Not sure it'll reach insolvency especially since a lot of that lending moved away from banks but that could make the pain worse. 

 

[lod001]

rally mode. futures up 2%. 

 

[fantasycurse42]

rally mode. futures up 2%. 

I’m convinced 80-90% of these overnight moves are meaningless. Just algos going nuts.

 

[humpback]

Interview was on March 18th - "On March 23rd, we completed the exit of our hedges generating proceeds of $2.6 billion for the Pershing Square funds ($2.1 billion for PSH), compared with premiums paid and commissions totaling $27 million, which offset the mark-to-market losses in our equity portfolio...We have redeployed substantially all of the net proceeds from our hedges by adding to our investments in Agilent, Berkshire Hathaway, Hilton, Lowe’s, and Restaurant Brands."

Again, the interview was weird. Crying about how screwed we were but saying he was buying stocks. Saying MAR is going bankrupt unless we shut the country down but then buying it despite the fact that we didn't even do what he recommended. Then hearing he exited his shorts after the interview and bought in stocks at levels that he helped drive down. At best, it's not a good look. 

He's a bit of a weird guy so no surprise that it was a weird interview. He had hedges on, nothing wrong with that and in fact was very smart. The market selloff was mostly over by March 18th, it wouldn't make much sense to try and tank the market when he wasn't net short, and he took them off and added to his longs when the Fed news and bailout package news came out. As you said, he put the hedges on in January and February, was taking some of them off before the interview, and was adding to his longs before then as well.

He didn't say we were screwed, he said we would be screwed if we didn't shut things down and if we did it would bring a favorable reaction from the market- I certainly think that's possible if not likely. Seems to me like he was trying to scare the government into acting boldly and swiftly rather than scaring the market lower. I feel icky trying to defend the guy but I'm really not seeing the problem (in this case).

 

[Binky The Doormat]

I’m convinced 80-90% of these overnight moves are meaningless. Just algos going nuts.

now almost 4% ...what's going on?

 

[ghostguy123]

now almost 4% ...what's going on?

Nothing but more bad news everywhere.  People love bad news.

 

[-OZ-]

Any reason why DFS over SYF?

Not really, just more familiar with discover. 

 

[-OZ-]

Nothing but more bad news everywhere.  People love bad news.

The daily moves of the market are irrational. 

 

[ghostguy123]

The daily moves of the market are irrational. 

Nightly moves also.  Wasnt it a week or so ago where futures were down 5% but by the end of the day everything was up like 6%?

Maybe Trump blindly telling the commissioner that he think the NFL will kick off on time set the market ablaze.

 

[humpback]

no question.   My best guess is we land between 15-20% unemployment and a lot of long term small business devastation.

However, small businesses do not directly correlate to publicly traded stocks and even compete with some of them like Walmart and Amazon.  My comment was regarding publicly traded stocks since that is what I'm most interested in for this thread.

Small businesses employ almost half of the workforce and create most of the net new jobs. If they get crushed a lot of people won't have the money to spend at the larger publicly traded companies.

 

[sporthenry]

If I had to guess, it's likely due to NYC data seemingly flattening. Just weird to see it rallying with oil down 6%. I'd probably fade both moves. Will definitely buy some oil ahead of the meeting if it stays down tomorrow. 

 

[TripItUp]

Small businesses employ almost half of the workforce and create most of the net new jobs. If they get crushed a lot of people won't have the money to spend at the larger publicly traded companies.

Sure, but it’s an indirect relationship and every company has different exposure.

Also, 15% unemployment is not the end of the world for Many publicly traded companies. If it were 50% unemployment I’d have greater concerns. 

 

[humpback]

If I had to guess, it's likely due to NYC data seemingly flattening. Just weird to see it rallying with oil down 6%. I'd probably fade both moves. Will definitely buy some oil ahead of the meeting if it stays down tomorrow. 

They were inversely correlated on Friday as well- too many external factors these days to draw much of a conclusion IMO.

 

[sporthenry]

They were inversely correlated on Friday as well- too many external factors these days to draw much of a conclusion IMO.

Fair, guess that also shows how irrelevant oil is to our indices anymore. I guess that is also why it seems like we haven't hit peak bearishness because with limited news over the weekend and overreacting to probably limited futures volume, I'd think anything would derail futures. I figured the oil rally on Friday just kept the bottom from falling out on Friday. 

 

[JerseyToughGuys]

Well I'm not an expert but don't think this will behave and mutate like the flu. You can throw money at the economy after all this is said and done. 

If you honestly think it's this bad, you shouldn't worry about stocks and should go load up on guns and gold. 

ETA: "The new coronavirus, however, seems to mutate slowly, experts say. This means its vaccine would most likely be effective long-term, much like a measles vaccine."

https://www.businessinsider.com/new-coronavirus-mutates-slowly-vaccine-could-be-long-lasting-2020-3

Throwing money at the problem doesn’t eliminate the enormous problem on the demand side. 

 

[sporthenry]

Throwing money at the problem doesn’t eliminate the enormous problem on the demand side. 

Well which demand problem? The fact people can't leave their house for a few months? Sure but after that, some demand is destroyed but some will bounce back. 

 

[Gawain]

Bloomberg fairly heavy on the words of Pence/Trump and the data from Europe/NYC showing a decline in new cases D/D.

I hope that the data is being read right, because it would be awesome if we're at least at the end of the beginning of the crisis.

 

[stbugs]

If I had to guess, it's likely due to NYC data seemingly flattening. Just weird to see it rallying with oil down 6%. I'd probably fade both moves. Will definitely buy some oil ahead of the meeting if it stays down tomorrow. 

I agree. I think the whole flattening of the curve is what the markets are looking for and I may be selling a bit if there's a big rally. I just don't trust the moves up, but wouldn't mind reallocating a few stocks for a couple others. I was a bit heavy on a few stocks and did some re-balancing the past few weeks.

 

[BassNBrew]

Bloomberg fairly heavy on the words of Pence/Trump and the data from Europe/NYC showing a decline in new cases D/D.

I hope that the data is being read right, because it would be awesome if we're at least at the end of the beginning of the crisis.

Doubtful.  Seems to be that Sunday reporting has been lower based on some stats others have been posting.

 

[sporthenry]

I agree. I think the whole flattening of the curve is what the markets are looking for and I may be selling a bit if there's a big rally. I just don't trust the moves up, but wouldn't mind reallocating a few stocks for a couple others. I was a bit heavy on a few stocks and did some re-balancing the past few weeks.

What sort of stocks are you looking at? The defensive stocks will do better, sure, but if things get worse, no stock is going to do well. The beaten down stocks usually outperform the market rally. 

 

[Gawain]

Doubtful.  Seems to be that Sunday reporting has been lower based on some stats others have been posting.

Then go short. Just reporting why the futures went heavy green.

 

[Challenge Everything]

So, the futures look... good?

 

[Don Hutson]

So, the futures look... good?

Futures so bright I gotta wear shades

 

[BassNBrew]

Then go short. Just reporting why the futures went heavy green.

I'm trying to make sense of it and decide when to hop in.  These futures have flipped on a dime from Sunday night recently.

 

[fantasycurse42]

Hopefully we can keep the charade of this only impacting demand for a few months and simply deferring it, for as long as possible. Maybe with the light right over the horizon, I can keep my job... that would be awesome!

I’m of the opinion demand will be lost, not deferred and things are ugly until we have some sort of treatment that keeps the fatality rate to no more than 2-3x the flu. That’ll incorporate widespread testing with CYDY or malaria drugs and at that point, I’d say a rebound is real. In any city, you’ll go from 1k to 10k cases in a week or so if it goes unchecked, so unless it’s eradicated, it’s a threat. When I see the testing and treatment lining up (and really, need to dive into the data to get in front of it), that’s when I start piling in, but really not until then. 

 

[JerseyToughGuys]

Well which demand problem? The fact people can't leave their house for a few months? Sure but after that, some demand is destroyed but some will bounce back. 

When is “after that”? When is a movie theatre or a restaurant or an airplane or a cruise ship or a shopping mall gonna be filled again?

 

[sporthenry]

When is “after that”? When is a movie theatre or a restaurant or an airplane or a cruise ship or a shopping mall gonna be filled again?

Well are you asking when the economy re-opens? Or do you think there won't be demand once things start?

 

[Penguin]

Movie theaters will be a thing of the past not too long from now.

 

[pecorino]

When is “after that”? When is a movie theatre or a restaurant or an airplane or a cruise ship or a shopping mall gonna be filled again?

It’s a good question. I think we need at least three things: 1) reliable, cheap, plentiful, accurate testing, 2) a couple reasonably effective treatments and 3) a vaccine. The first two are on the doorstep. The third looks like it’s a year away. I suspect a lull period in the summer when folks will begin to let their guards down (and Trump will push us to get back to normalcy) but next fall and winter we will be on eggshells waiting for the re-emergence. Spring 2021 is looking good, though. 

 

[TripItUp]

Movie theaters will be a thing of the past not too long from now.

Certainly less commonplace but I don’t think completely gone.

 

[stbugs]

What sort of stocks are you looking at? The defensive stocks will do better, sure, but if things get worse, no stock is going to do well. The beaten down stocks usually outperform the market rally. 

Not looking at stocks that will do better in the downturn. I meant that I was waiting to see if stocks hit new lows. For instance, FSLY is $19.45, but I bought a second lot (first was $19 last year) at $11.32 on 3/16. I wish I bought more, just wanted to drop my overall cost basis. Same with ROKU, bought two weeks ago at $65. Owned it at $96 as well. If it gets down near $70ish, I'd think about another purchase.

 

[sporthenry]

Certainly less commonplace but I don’t think completely gone.

Yeah, I mean cruise lines and movie theaters aren't indicative of the general economy either. They can die and the market can go up. I do think DIS going direct with some movies is a concern but as long as they see a value in it, there will be theaters. Still doesn't mean AMC is worth anything. 

 

[JerseyToughGuys]

Well are you asking when the economy re-opens? Or do you think there won't be demand once things start?

I cannot even wrap my head around what “when the economy reopens” even means here. I don’t foresee it being like flipping a switch to ON and the world picks right back up.

look at the Tomtom data from China. They’ve been told to go back to work so traffic is at 80 percent of what it used to be during the week. On the weekends it’s still down 80-90 percent. Everyone is still staying home.

 

[Don Hutson]

Movie theaters will be a thing of the past not too long from now.

They've been saying that for years and attendance keeps going up.  

 

[sporthenry]

They've been saying that for years and attendance keeps going up.  

Attendance hasn't been going up. Ticket prices have. Attendance has been declining pretty consistently but they keep raising prices so box office has been going up. At some point, one would think that stops. Perhaps a recession?

 

[BassNBrew]

Hopefully we can keep the charade of this only impacting demand for a few months and simply deferring it, for as long as possible. Maybe with the light right over the horizon, I can keep my job... that would be awesome!

I’m of the opinion demand will be lost, not deferred and things are ugly until we have some sort of treatment that keeps the fatality rate to no more than 2-3x the flu. That’ll incorporate widespread testing with CYDY or malaria drugs and at that point, I’d say a rebound is real. In any city, you’ll go from 1k to 10k cases in a week or so if it goes unchecked, so unless it’s eradicated, it’s a threat. When I see the testing and treatment lining up (and really, need to dive into the data to get in front of it), that’s when I start piling in, but really not until then. 

Let me give you something to consider.  What if due to lack of testing and undetected cases, this has already sweep thru 25% of us,  The question is how fast do we get to herd immunity.

 

[fantasycurse42]

Let me give you something to consider.  What if due to lack of testing and undetected cases, this has already sweep thru 25% of us,  The question is how fast do we get to herd immunity.

So we have 300k reported cases in the US, and it’s swept through close to 100mm people in this scenario?

 

[humpback]

According to what I read, Buffett sold 2.3M shares of LUV, but still has 51M shares.  To me this does not seem like an indicator Buffett is all that down on LUV.

Sure, but it doesn't seem like an indicator that he's all that high on them at the moment either.

He sold more of DAL, which he just bought more of at the end of February and a couple of weeks ago he laughingly said "I won't be selling airline stocks".

Will be interesting to follow...

 

[Don't Noonan]

Movie theaters will be a thing of the past not too long from now.

Why?

 

[BassNBrew]

So we have 300k reported cases in the US, and it’s swept through close to 100mm people in this scenario?

That's the problem.  No one really knows.

 

[Slapdash]

Movie theaters will be a thing of the past not too long from now.

Yeah.  When the tide goes out this is exactly the type of business that will be left dry.  Except in niches. 

 

[JerseyToughGuys]

Let me give you something to consider.  What if due to lack of testing and undetected cases, this has already sweep thru 25% of us,  The question is how fast do we get to herd immunity.

We aren’t getting to herd immunity without a vaccine and/or confirmation you can’t get it more than once. Ask Boris Johnson who was hospitalized today. 

good article explaining why it’s a pipe dream right now. But I digress