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  #221  
Old 27.04.2020, 10:17
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Re: Markets down - Invest now or wait further?

I now believe with an 80% degree of certainty that the stock market low was late March.

Looking back at history to March 1933, the low was just before Roosevelt printed money to create credit. 2008 low was just before the Federal Government decided to bail out the Banks. All Governments seem to be throwing as much money as it takes in the current crisis.
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  #222  
Old 27.04.2020, 11:39
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Re: Markets down - Invest now or wait further?

To a non-economist, can anyone explain why throwing money at the economies will not lead to hyper-inflation, or put another way, why did Germany suffer hyper-inflation in the thirties but the UK and USA did not, and are there differences between counties to be expected now in the 2020's?
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  #223  
Old 27.04.2020, 12:42
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Re: Markets down - Invest now or wait further?

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To a non-economist, can anyone explain why throwing money at the economies will not lead to hyper-inflation, or put another way, why did Germany suffer hyper-inflation in the thirties but the UK and USA did not, and are there differences between counties to be expected now in the 2020's?
It ought to, which is good for equity holders, very bad for bond holders. The only reason why id did not happen after the financial crisis is people were worried about their jobs so did not demand pay rises, I suspect the same will be true today as we will have fairly high unemployment.
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  #224  
Old 27.04.2020, 12:59
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Re: Markets down - Invest now or wait further?

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Somehow I cannot see the second leg but the technology market is slowly clawing back. Maybe the people decide about it and the current ongoing circumstances instead of the past history.
That was my feeling a month ago and somehow it’s difficult for me to change sentiments given that the bottom was in March 2020 and we are in the technology market recovery phase. The NASDAQ value has already reached the one from January 2020. Technology has always been a good investment, especially now with tech gurus trying to figure out the next state of the art post COVID19 realm.

NQ=F $8'866.50 (+1.11%) on Yahoo Finance
https://finance.yahoo.com/quote/NQ=F?p=NQ=F
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  #225  
Old 27.04.2020, 14:21
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Re: Markets down - Invest now or wait further?

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To a non-economist, can anyone explain why throwing money at the economies will not lead to hyper-inflation, or put another way, why did Germany suffer hyper-inflation in the thirties but the UK and USA did not, and are there differences between counties to be expected now in the 2020's?
From what I have read the money printed after 2008 went to to the banks/hedge funds/wealthy individuals and these people (so called 1 percenters) caused inflation in prime real estate, art work, exotic/classic cars and other luxury items like 1st class air tickets etc.

The general public got a bit if you had a mortgage but not that much therefore not causing much inflation (but they did cause some in items like iPhones for example).

I suspect the same will happen this time although the money printed are a multiple of the post 2008 years so we don't really know.
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  #226  
Old 27.04.2020, 14:52
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Re: Markets down - Invest now or wait further?

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From what I have read the money printed after 2008 went to to the banks/hedge funds/wealthy individuals and these people (so called 1 percenters) caused inflation in prime real estate, art work, exotic/classic cars and other luxury items like 1st class air tickets etc.

The general public got a bit if you had a mortgage but not that much therefore not causing much inflation (but they did cause some in items like iPhones for example).

I suspect the same will happen this time although the money printed are a multiple of the post 2008 years so we don't really know.
A good explanation.

But I fear there may be more to it than that, that there is somehow an action delay in the system and that at some point all the extra money will start getting onto the market and causing havoc.
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  #227  
Old 27.04.2020, 15:07
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Re: Markets down - Invest now or wait further?

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I now believe with an 80% degree of certainty that the stock market low was late March.

Looking back at history to March 1933, the low was just before Roosevelt printed money to create credit. 2008 low was just before the Federal Government decided to bail out the Banks. All Governments seem to be throwing as much money as it takes in the current crisis.
I'm still not so sure, wait for companies to start releasing quarterly results to give an idea of how bad things really are and that could put the frighteners on investors. Oil price is a good indicator of what's to come. Apple delaying iPhone production, Airbus on the ropes, all small indicators that the dead cat could yet come crashing back to Earth.

I also think there's a risk that the printing money game that everyone is playing will have to come tumbling down at some point. That said, I think the recovery will be quick once things do start to return normal.
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  #228  
Old 28.04.2020, 09:49
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Re: Markets down - Invest now or wait further?

BP just posted a £3.4 billion loss for Q1
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  #229  
Old 28.04.2020, 10:02
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Re: Markets down - Invest now or wait further?

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BP just posted a £3.4 billion loss for Q1
inventory was adjusted down, it will adjusted back up if oil price recovers later this year.

given the circumstances what did you expect?
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  #230  
Old 28.04.2020, 10:30
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Re: Markets down - Invest now or wait further?

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inventory was adjusted down, it will adjusted back up if oil price recovers later this year.

given the circumstances what did you expect?
If... I did expect a loss, perhaps not quite on that scale though. Considering I've not filled up a car in 6-7 weeks, it probably was to be expected.

Issue is they're likely going to have slash jobs immediately (as will many others in Oil and Gas) and that will have knock-on effects on the economy.
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  #231  
Old 28.04.2020, 10:39
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Re: Markets down - Invest now or wait further?

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If... I did expect a loss, perhaps not quite on that scale though. Considering I've not filled up a car in 6-7 weeks, it probably was to be expected.

Issue is they're likely going to have slash jobs immediately (as will many others in Oil and Gas) and that will have knock-on effects on the economy.
if yes but economies are starting to open up again. we are not going to stay in for ever.
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  #232  
Old 07.05.2020, 11:31
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Re: Markets down - Invest now or wait further?

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It's surely possible to make guesses. But where will it take you? After 15 years, ~92% of active funds underperform a market index [1].
Let us not forget the analysed period in that article is a period without any serious crisis. Index funds did exceptionaly well in the past decade.

I don't know whether active funds or index funds will do better in the next crisis. There is simply no comparative data. Index funds (in particular the ones which are weighted by market value) have seen unprecedented inflows in the last decade - I call this crazy money. I fear the outflows will be the same (crazy).

I would not bet on index funds overperforming to such a great extent in the future.

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  #233  
Old 08.05.2020, 11:22
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Re: Markets down - Invest now or wait further?

I'm waiting.

The 'crash' was a correction based on an assumption that things were going to be bad (plus an over inflated market correction). The rally is based on 'ah, it's not going to be that bad, government bail outs in the short term and then we all go back to normal'

But.. normal ain't happing for at least a year. Results will start to come out showing big losses, government bail outs will dry up.. stock prices will fall again.

Maybe
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  #234  
Old 08.05.2020, 12:58
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Re: Markets down - Invest now or wait further?

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I'm waiting.

The 'crash' was a correction based on an assumption that things were going to be bad (plus an over inflated market correction). The rally is based on 'ah, it's not going to be that bad, government bail outs in the short term and then we all go back to normal'

But.. normal ain't happing for at least a year. Results will start to come out showing big losses, government bail outs will dry up.. stock prices will fall again.

Maybe
The crash was based on the absurd estimates of the no of deaths, so the market was misinformed by governments.

S&P 500 is down roughly the value of loss of 100% of 1 years profits on discounted cash flow valuation of the companies.

Plenty of tech stocks are making more money as a result of lockdown which is why the NASDAQ is above it's level on 31/12/19.

Time to be a stock picker rather than market timer, I believe.
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  #235  
Old 08.05.2020, 13:19
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Re: Markets down - Invest now or wait further?

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I'm waiting.

The 'crash' was a correction based on an assumption that things were going to be bad (plus an over inflated market correction). The rally is based on 'ah, it's not going to be that bad, government bail outs in the short term and then we all go back to normal'

But.. normal ain't happing for at least a year. Results will start to come out showing big losses, government bail outs will dry up.. stock prices will fall again.

Maybe
I'm also still waiting, Tesla have had to suspend production due supply chain problems caused by the lockdown. Who's going to be next? Apple? Samsung? We still don't know how many small businesses have gone under yet seeing that as the preferable option to saddling themselves with more debt. Oil price still all over the place, Berkshire Hathaway sitting on mountains of cash rather than investing. I still think it has to go down again before it goes up. Unprecedented times though so who knows!?
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  #236  
Old 08.05.2020, 13:38
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Re: Markets down - Invest now or wait further?

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The crash was based on the absurd estimates of the no of deaths, so the market was misinformed by governments.

S&P 500 is down roughly the value of loss of 100% of 1 years profits on discounted cash flow valuation of the companies.

Plenty of tech stocks are making more money as a result of lockdown which is why the NASDAQ is above it's level on 31/12/19.

Time to be a stock picker rather than market timer, I believe.

Erase Uber (https://www.nytimes.com/2020/05/05/t...t-lawsuit.html) and Grubhub (food delivery service fails to generate profit during lockdown) from the pick list.
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  #237  
Old 08.05.2020, 14:17
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Re: Markets down - Invest now or wait further?

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Erase Uber (https://www.nytimes.com/2020/05/05/t...t-lawsuit.html) and Grubhub (food delivery service fails to generate profit during lockdown) from the pick list.
UBER never made a profit........
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  #238  
Old 08.05.2020, 14:55
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Re: Markets down - Invest now or wait further?

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UBER never made a profit........
And on top of that is getting at home the same lawsuit that lost in the UK & Spain, probably even higher operational costs and for sure lower demand these days.
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  #239  
Old 05.06.2020, 12:45
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Re: Markets down - Invest now or wait further?

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Unemployment is hugely good for company profits, it's easy to offload the dead wood & salary expectations drop.

Never invest in an airline, profits for the complete industry since the Wright Brothers first flew is ZERO.

There have been 2 of the best weeks in 70 years occurred in the last 4 weeks, holding cash is a way to reduce your return over time.
i don't normally invest in airlines, but did buy IAG. well run and a potential winner from european airline bankruptcies and consolidation (assuming it doesn't go bankrupt itself in case covid-19 gets worse).
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  #240  
Old 05.06.2020, 12:53
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Re: Markets down - Invest now or wait further?

Remarkable that the markets are still on a run and many have recouped all the losses from the the early Covid related drops. Still totally artificial in my opinion, US unemployment at +30 million, the printing presses whirring away yet inflation at 0.3%, companies about to post massive losses yet little impact seen on market value. Probably never been a greater disparity between Wall Street and the man on the street!
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