Author Topic: Bottom is in!  (Read 40415 times)

VaCPA

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Re: Bottom is in!
« Reply #50 on: March 20, 2020, 02:22:12 PM »
Anyone buying now gets -30% off the price of stocks from 4 weeks ago, and -27% since the start of the year.  That's decent, even if more volatility is ahead.

Further evidence I called it right (sorry I'm being repetitive... I'm still stunned I make this call Wednesday)

Did the market bomb right after you posted that? Jinxed it. I think it'll take more than a day or two of stability before we declare market has bottomed.

Jack0Life

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Re: Bottom is in!
« Reply #51 on: March 20, 2020, 02:25:50 PM »
I don't think the bottom is in.
This is just the first week of a soft lock down.
It will get worst in 2-3 weeks. We might see bottom when we really start seeing businesses shutting down, unemployment, etc....
Until we see the Coronavirus cases flatten out, the panic will continue.
Still sticking to my 15k Dow target.

bthewalls

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Re: Bottom is in!
« Reply #52 on: March 20, 2020, 03:11:19 PM »
I reckon bottom is still a bit off...im gambling 50% drop over all....I thin usa has some way to go yet.

once covid develops in USA things will get work...its about 2 weeks behind

Baz

Buffaloski Boris

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Re: Bottom is in!
« Reply #53 on: March 20, 2020, 03:30:24 PM »
S+P closed at 2304. If my math is correct, that’s 31% drop from the high and we’re about 3 weeks into this.

Bear markets haven’t turned around in 3 weeks in the past. Or even hit bottom. I reckon the Bottom Is In! But just for this week.

tooqk4u22

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Re: Bottom is in!
« Reply #54 on: March 20, 2020, 03:37:36 PM »
I posted the following on a week ag, feels like a year ago.    Still in the 75% range at 32% down but getting close to that 40% down range where my 20% probability was set.   I am now thinking that 50% has a greater probability, I just don't see how that can't happen.   This will not turnaround without some visibility to the spread, leveling and treatment of the virus. 

This.   There are absolutely 100's of thousands if not millions more people here and globally that have or have had the virus but can't or haven't or won't be tested (no kits, not severe enough symptoms) and while this is perfectly logical the irrational will continue to win out as the numbers increase dramatically over the next 30 days. 

My probabilities for the next 30-90 days:
Get back to correction territory (10% off highs) - 2%
Range bound between Dec 2018 Lows and 20% off highs - 75%
down another 10% from high - 20%
Hit 50% down from highs - 3%

bthewalls

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Re: Bottom is in!
« Reply #55 on: March 20, 2020, 03:52:16 PM »
read today that dalio estimated the size of any useful stimulus program at $1.5-2trillion.

think the current proposed figure is in the realm of $850 billion?...will it re-inflate the market or only give a temporary lift....WINTER IS COMING (GoT).

Once covid gets into USA properly we will see how far down this goes.....Buffet hasn't budged yet....

moneytaichi

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Re: Bottom is in!
« Reply #56 on: March 20, 2020, 03:57:18 PM »
I don't think the bottom is in.
This is just the first week of a soft lock down.
It will get worst in 2-3 weeks. We might see bottom when we really start seeing businesses shutting down, unemployment, etc....
Until we see the Coronavirus cases flatten out, the panic will continue.
Still sticking to my 15k Dow target.
I agree that the bottom is still not in. I don't think the stimulate packages alone can save it. The monster here is the Coronavirus. I wish US government puts more attention on how to slow down and test the virus.

Still, I am hedging that the market can go up or down so I put in some order for VTI right before the closing of the market. Next week will be very interesting.

Buffaloski Boris

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Re: Bottom is in!
« Reply #57 on: March 20, 2020, 04:41:45 PM »
I posted the following on a week ag, feels like a year ago.    Still in the 75% range at 32% down but getting close to that 40% down range where my 20% probability was set.   I am now thinking that 50% has a greater probability, I just don't see how that can't happen. 

You never know, and that’s why I haven’t sold my equities. That said, my prediction of the total drop was 30-40% and on reflection I think I was being optimistic. I haven’t seen a real depression before (although I personally think the GFC qualifies). So this will be very different from what I’ve experienced. One thing I do know is that once a bear market is in place, it typically takes several weeks to hit bottom.

Snoopyflier

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Re: Bottom is in!
« Reply #58 on: March 20, 2020, 06:53:35 PM »
No need to guess on the number of tests per day. Here it is: https://covidtracking.com/us-daily/


The virus more than doubles every 72 hours. I predicted (not here), that we would be at 10k by Friday, today we are at 19,469. By the 23rd we will be at 38,938 and by next Friday the 27th: 77,876.

https://www.worldometers.info/coronavirus/country/us/

Not to mention the purposeful listing of meds and companies today at the  WH press conference, the Pump and Dump is in. Watch next week, possibly a big rise then a big crash. The healthcare system will have a surge and are ill prepared.

Trust me, Chloroquine is NOT approved by the FDA, and will NOT be used. 

Have heard from a DC lawyer who looked over McConnell's bill, and he says that the cash payments to people will mostly be a  "Tax credit."  They are basing it on 2018 tax returns (Income from 2017.) People had higher income in 2017 and most dropped from 2017 -2020. 

Goldman Sachs predict the report will show 2.25 million Americans filed for their first week of unemployment benefits this week — eight times the number of people who filed last week and the highest level on record. That estimate is based on news reports of an unprecedented surge in layoffs early in the week.  800 filed in one day yesterday.

Trump laid off 160 workers in DC
51 in NYC
unknown number at Trump Vegas

« Last Edit: March 20, 2020, 07:32:27 PM by Snoopyflier »

MustacheAndaHalf

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Re: Bottom is in!
« Reply #59 on: March 20, 2020, 11:56:25 PM »
From my earlier post in this thread:

The markets open at 9 am EST, so I'll use that as my clock: it's 2:45 am in New York, Thursday, March 19.
I'm predicting a market bottom in advance, today or tomorrow (Mar 19-20).
...
So, we'll see... In advance, I'm predicting Thurs/Friday will be the market bottom (March 19-20).

Vanguard Total Stock Market ETF (VTI) closed at $115.19 on Friday, March 20.  So per my earlier post, that's my prediction of the market bottom.

It's likely unemployment and rising virus numbers will cause more drops, and prove me wrong.  I believe testing will ultimately be the way through the panic and uncertainty, but markets will probably figure that out more slowly.

MustacheAndaHalf

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Re: Bottom is in!
« Reply #60 on: March 21, 2020, 05:29:59 AM »
I don't think the bottom is in.
This is just the first week of a soft lock down.
It will get worst in 2-3 weeks. We might see bottom when we really start seeing businesses shutting down, unemployment, etc....
Until we see the Coronavirus cases flatten out, the panic will continue.
Still sticking to my 15k Dow target.
Agreed, I was wrong - the market will go lower.

For example, businesses are shutting their doors and unemployment is heading sharply higher.  Congress has the ability to deal with that, but I can't predict how well they'll do.  It's an election year, which makes me hopeful.  So a drop from negative events, until Congress addresses them - can't predict it.

COVID-19 testing will become more widespread in the U.S., and reduce community spread.  But that takes time to happen, and time for the markets to recognize it.  I forgot to consider what other people know about the virus.  Unemployment will hit sooner and easier than a vague idea like testing slowing down the spread of the virus.

So I'm probably wrong about Friday being the bottom.  I'm still happy I bought in at a big discount!

dabears847

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Re: Bottom is in!
« Reply #61 on: March 21, 2020, 06:37:51 AM »
Is the bottom in? I'm waiting at the moment and have a very large cash position that I've waited for a pull back to invest. I might be greedy waiting and could pay the price but there are too many variables such as bonds price, inverted yield curve, resession fears, small businesses are closing and skyrocketing unemployment. What happens if Democrats get in the office and tax rates change, all pe ratios change and another market correction. Dow 15000 is very real.

1. Buy some periodically
2. Wait for the negative news on markets to slow, such as new GDP, employment

Thoughts?

Buffaloski Boris

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Re: Bottom is in!
« Reply #62 on: March 21, 2020, 07:42:49 AM »
Is the bottom in? I'm waiting at the moment and have a very large cash position that I've waited for a pull back to invest. I might be greedy waiting and could pay the price but there are too many variables such as bonds price, inverted yield curve, resession fears, small businesses are closing and skyrocketing unemployment. What happens if Democrats get in the office and tax rates change, all pe ratios change and another market correction. Dow 15000 is very real.

1. Buy some periodically
2. Wait for the negative news on markets to slow, such as new GDP, employment

Thoughts?

IMHO, we're not at the bottom.  And won't be for awhile.  I posted a graphic a week or so ago that showed the number of days on average from the start of a bear market to the bottom.  It isn't a matter of 1-2 weeks.  A large part of the US and other industrialized countries economies are being shut down and layoffs are coming down fast and hard. It's difficult to predict how markets will react: they're often counterintuitive and irrational.

The orthodoxy here is that you put it all in at once and you don't attempt to market timing.  Well, if I had followed the orthodoxy, I'd be royally screwed about now.  I was slowly DCAing back into the market when this hit, and I ended up having relatively low equities exposure as a result.  I got hit, but not slammed. I view that more as luck than anything. And also an expensive reminder to stick to my own counsel. 

I won't give advice, but will tell you my subject-to-change plans.  I think we're probably in for a depression.  A brief one, but technically a depression nonetheless.  I don't expect a V shaped recovery, but more of a U.  I viewed the CAPE as being at nosebleed levels, which was at the root of my reluctance to have anything to do with US equities.  I believe that US equities (as measured by SP 500) will be somewhere near reasonably priced at a CAPE of around 20.  We were at a CAPE of just under 22 as of Friday.  That implies about another 10% drop before I'm all that interested. Due to the very strong dollar, I think that US market will still be relatively pricey.  That also implies that international markets are cheap.  So, I plan to start DCAing about when the CAPE for the SP 500 hits around 20.  Most exposure will be developed international, with US exposure weighted towards small cap.  Very limited exposure to SP 500, but some small amount for diversification. I haven't figured out whether I tie DCA to a specific number.  I.e. CAPE or SP 500 at a lower number means a higher percentage allocation, but I suppose I will try to do it more or less mathematically.  In the end, I expect to have a relatively robust allocation to equities by 2021. 

bthewalls

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Re: Bottom is in!
« Reply #63 on: March 21, 2020, 09:56:56 AM »
what about looking at this another way....?

yes, covid roughly doubles every 3/4 days. so hypothetically lets assume the market really tanks when 50% of USA are infected Covid....but when would that roughly be from now?  (when it gets to that point, there is no guarantee that the stimulus package will be sufficient for any meaningful market re-inflation)

so, USA population is 300million (ish). If 80%ish get covid thats 240million people. so how long would it take from now for 50% to become infected? i.e. 120 million people.

Also, consider that within 3/4 weeks of that mass infection, the same element of the population will then be immune (minus loses)...assuming no virus mutation.

So how long to 50% infection from now .i.e 120 million people.

baz


ender

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Re: Bottom is in!
« Reply #64 on: March 21, 2020, 10:22:18 AM »
what about looking at this another way....?

yes, covid roughly doubles every 3/4 days. so hypothetically lets assume the market really tanks when 50% of USA are infected Covid....but when would that roughly be from now?  (when it gets to that point, there is no guarantee that the stimulus package will be sufficient for any meaningful market re-inflation)

so, USA population is 300million (ish). If 80%ish get covid thats 240million people. so how long would it take from now for 50% to become infected? i.e. 120 million people.

Also, consider that within 3/4 weeks of that mass infection, the same element of the population will then be immune (minus loses)...assuming no virus mutation.

So how long to 50% infection from now .i.e 120 million people.

baz

Something to consider - our test rate is increasing dramatically as well.

Covid could already be much significantly more widespread in the USA than we realize and we are just finding it via testing.


bthewalls

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Re: Bottom is in!
« Reply #65 on: March 21, 2020, 10:44:41 AM »
well, im UK based and we are only testing those that turn up at hospitals in bad condition.  Those with mild to moderate conditions stay at home (and spread it) without any tests..

the question is, since the usa market is the largest, at what percentage of infection does it tank?  50%? 75%?

its hard to know...at a guess when it reaches 50% is reasonable to buy in

vand

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Re: Bottom is in!
« Reply #66 on: March 21, 2020, 10:56:06 AM »
Is the bottom in? I'm waiting at the moment and have a very large cash position that I've waited for a pull back to invest. I might be greedy waiting and could pay the price but there are too many variables such as bonds price, inverted yield curve, resession fears, small businesses are closing and skyrocketing unemployment. What happens if Democrats get in the office and tax rates change, all pe ratios change and another market correction. Dow 15000 is very real.

1. Buy some periodically
2. Wait for the negative news on markets to slow, such as new GDP, employment

Thoughts?

IMHO, we're not at the bottom.  And won't be for awhile.  I posted a graphic a week or so ago that showed the number of days on average from the start of a bear market to the bottom.  It isn't a matter of 1-2 weeks.  A large part of the US and other industrialized countries economies are being shut down and layoffs are coming down fast and hard. It's difficult to predict how markets will react: they're often counterintuitive and irrational.

The orthodoxy here is that you put it all in at once and you don't attempt to market timing.  Well, if I had followed the orthodoxy, I'd be royally screwed about now.  I was slowly DCAing back into the market when this hit, and I ended up having relatively low equities exposure as a result.  I got hit, but not slammed. I view that more as luck than anything. And also an expensive reminder to stick to my own counsel. 

I won't give advice, but will tell you my subject-to-change plans.  I think we're probably in for a depression.  A brief one, but technically a depression nonetheless.  I don't expect a V shaped recovery, but more of a U.  I viewed the CAPE as being at nosebleed levels, which was at the root of my reluctance to have anything to do with US equities.  I believe that US equities (as measured by SP 500) will be somewhere near reasonably priced at a CAPE of around 20.  We were at a CAPE of just under 22 as of Friday.  That implies about another 10% drop before I'm all that interested. Due to the very strong dollar, I think that US market will still be relatively pricey.  That also implies that international markets are cheap.  So, I plan to start DCAing about when the CAPE for the SP 500 hits around 20.  Most exposure will be developed international, with US exposure weighted towards small cap.  Very limited exposure to SP 500, but some small amount for diversification. I haven't figured out whether I tie DCA to a specific number.  I.e. CAPE or SP 500 at a lower number means a higher percentage allocation, but I suppose I will try to do it more or less mathematically.  In the end, I expect to have a relatively robust allocation to equities by 2021.

I agree it takes more than a few weeks for a bear market to run its course. But the speed of this bear market has been unprecedented, so I do think it will all play out a lot faster than past bears have. 

Maybe we aren't anywhere near a bottom, but the market does not go straight down just as it does not go straight up. I would at least expect a good bounce before a further selloff and the final bottom (A-B-C pattern).  I can see a scenario where that takes another 6 months to play out, so there would be some significant duration to the bear market.

European indices where events seems to be slightly ahead of the US are quite a bit off their lows and don't seem to want to go lower, at least for the time being.

Also, make no mistake that the fortunes of the stock market will be a massive factor in the Presidential election. Trump would regularly brag about the market as it was reaching new highs (remember him saying "it should be 10,000 points higher!") It has become a political asset or liability depending on its level. Rightly or wrongly, the Fed will be under tremendous pressure to reinflate asset prices before the election.
« Last Edit: March 21, 2020, 11:03:48 AM by vand »

Buffaloski Boris

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Re: Bottom is in!
« Reply #67 on: March 21, 2020, 12:55:48 PM »

I agree it takes more than a few weeks for a bear market to run its course. But the speed of this bear market has been unprecedented, so I do think it will all play out a lot faster than past bears have. 

Maybe we aren't anywhere near a bottom, but the market does not go straight down just as it does not go straight up. I would at least expect a good bounce before a further selloff and the final bottom (A-B-C pattern).  I can see a scenario where that takes another 6 months to play out, so there would be some significant duration to the bear market.

European indices where events seems to be slightly ahead of the US are quite a bit off their lows and don't seem to want to go lower, at least for the time being.

Also, make no mistake that the fortunes of the stock market will be a massive factor in the Presidential election. Trump would regularly brag about the market as it was reaching new highs (remember him saying "it should be 10,000 points higher!") It has become a political asset or liability depending on its level. Rightly or wrongly, the Fed will be under tremendous pressure to reinflate asset prices before the election.

Yeah, I do believe that this bear will be faster than most.  I took a look at the FTSE 100 and if my math is right, the current CAPE is somewhere around 11.4.  Wow.  That's very good deal in my book.  And that doesn't include the exchange rate impact.  I still think it'll drop some more as an unreasonable number of people end up with COVID in the UK* and things shut down. I expect that I'll be on a shopping mission here within a couple of weeks.   

I suspect the reason why the European indices haven't gone done much further is that they started at a lower point.  The US market still has a ways to go.  Comparatively speaking, I think the US is not so good a deal. I agree that the Fed will goose the market as much as it can. 

*(blasted politicians will be the death of us all.)

Cabaka

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Re: Bottom is in!
« Reply #68 on: March 21, 2020, 01:28:28 PM »
I posted the following on a week ag, feels like a year ago.    Still in the 75% range at 32% down but getting close to that 40% down range where my 20% probability was set.   I am now thinking that 50% has a greater probability, I just don't see how that can't happen. 

You never know, and that’s why I haven’t sold my equities. That said, my prediction of the total drop was 30-40% and on reflection I think I was being optimistic. I haven’t seen a real depression before (although I personally think the GFC qualifies). So this will be very different from what I’ve experienced. One thing I do know is that once a bear market is in place, it typically takes several weeks to hit bottom.


this why I like the mmm forum.

mkt dropped faster than the great depression, recession predictions from serious people like bank of America. even if a vaccine is announced tomorrow, the economic fallout is just beginning and people here are still holding. some that rode it down in 2008 did not get back to even for over 5 years and that was on the back of QE1, 2 and 3; wonder how long it will be this time.

vand

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Re: Bottom is in!
« Reply #69 on: March 21, 2020, 06:44:32 PM »
I've followed the market since 1999 and I can categorically tell you that every time we put in a bear market bottom, it never felt like that was going to be the point the market started to recover, and most participants and observers were of the opinion that the market had further to fall.

Of course, this has to be the case - the market bottoms are forged at the point of maximum pessimism where nearly everyone is convinced that it will only fall further, otherwise it would have already bottomed!

As I said numerous times, I don't know if we are near a bottom, but I have no doubt that the day we put in a bottom probably won't feel like that will be the day the fightback has begun.. it will feel to nearly everyone that the market can only keep going down. Right now a fairly popular question doing the rounds is "how much further can we fall?" People are only looking down.

bthewalls

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Re: Bottom is in!
« Reply #70 on: March 22, 2020, 05:40:44 AM »
I suppose one simply but effective solution is to just dollar point from now on over the next few months and pepper the dip.  Lets face it, prices are acceptably low now and timing the actual bottom is impossible...as it always it.

Im happy to buy small but regularly from here on and avoid aiming for perfection.  In ten years time I suppose it wont make any difference whether I bought at -25% or -35%.....However, it would be satisfying to call the bottom.  I think the bottom will be when 50%+ ish of USA is infected....panic will really start then?

Based on todays USA infected population of 26,668 and a rough doubling every 3ish days, I calculate the following (assuming no containment and vaccine):

infected     days from now
26,668            1-3
53,336            6
106,672            9
213,344           12
426,688           15
853,376           18
1,706,752           21
3,413,504           24
6,827,008           27
13,654,016   30
27,308,032   33
54,616,064   36
109,232,128   39
218,464,256   42
436,928,512   45

so in theory USA 300mill population could, and I stress could before someone attacks me, be fully infected somewhere after days 42 ish?...based on current trends.  Assume a c. 1% loss of population once hospitals get swamped.

Let me know what others think of projection. 

Barry


vand

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Re: Bottom is in!
« Reply #71 on: March 22, 2020, 05:54:20 AM »
Yes. You won't catch the absolute bottom, and neither should you try.

The person obsessed with buying right at the bottom is also the person who is going to take their 40% rebound profits after a 2 month rally. I'm looking to ride the next bull market for 400%, even if that takes another 10-15 years.

The overwhelmingly important thing is simply to have a plan to accumulate as much as you can throughout this crisis and then stick to it.

I've bought heavily into this crash with all the cash I was willing to put in, so I'm low on ammo now if it goes lower, but I absolutely do not regret the purchases I have recently made. That is what it was there for; to buy at what I consider a discount, not to try to pick the bottom. From here on my buying will mostly be my monthly pension contributions, and if stocks remain beaten down for the next year it doesn't change my plan one iota.

I do have 1yr of emergency cash, but that is what it says on the tin, and given that most of our employment prospects do not look that promising right now I'm happy to sit on it.

bthewalls

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Re: Bottom is in!
« Reply #72 on: March 22, 2020, 07:08:31 AM »
Same as that...I'm still working but keep a years cash as prudent reserve.

Tempted to use it but wont.   Self employed and felt 2008 badly ...once bitten twice shy...

MustacheAndaHalf

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Re: Bottom is in!
« Reply #73 on: March 22, 2020, 09:50:22 AM »
Based on todays USA infected population of 26,668 and a rough doubling every 3ish days, I calculate the following (assuming no containment and vaccine):
...
13,654,016   30
Countries have been infected longer than 30 days, and none of them hit 13 million cases.  I view this more like weather forecasting, where using recent data to predict a week's worth of cases might be fruitful.  That way when growth rates change, predictions reflect the changes.  Let me show that with WHO data taken 30 days apart, using Feb 20 and Mar 21.
https://www.who.int/docs/default-source/coronaviruse/situation-reports/20200220-sitrep-31-covid-19.pdf?sfvrsn=dfd11d24_2
https://www.who.int/docs/default-source/coronaviruse/situation-reports/20200321-sitrep-61-covid-19.pdf?sfvrsn=6aa18912_2

China went from 75k to 81k cases, which is not exponential growth.
Korea went from 100 to 8800, which looks exponential, until seeing they had 6.3k cases halfway through.

Italy went from 3 to 47k cases.
U.S. went from 15 to 15k cases.

In each country, cases represent positive test results.  Without testing, the numbers stay artificially low.  When testing is adequate, the virus looks like it's moving much faster - because testing catches up.  The starting numbers in Italy and the U.S. are severe under counts that reflect a lack of testing at the time.

Which brings me to the bottom... isn't in.  To me, increased cases in the U.S. reflect accuracy - a higher rate of testing removes uncertainty about who is infected.  But the numbers will scare most people, and news stories based on old data will reinforce that fear.

bthewalls

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Re: Bottom is in!
« Reply #74 on: March 22, 2020, 12:00:36 PM »
Based on todays USA infected population of 26,668 and a rough doubling every 3ish days, I calculate the following (assuming no containment and vaccine):
...
13,654,016   30
Countries have been infected longer than 30 days, and none of them hit 13 million cases.  I view this more like weather forecasting, where using recent data to predict a week's worth of cases might be fruitful.  That way when growth rates change, predictions reflect the changes.  Let me show that with WHO data taken 30 days apart, using Feb 20 and Mar 21.
https://www.who.int/docs/default-source/coronaviruse/situation-reports/20200220-sitrep-31-covid-19.pdf?sfvrsn=dfd11d24_2
https://www.who.int/docs/default-source/coronaviruse/situation-reports/20200321-sitrep-61-covid-19.pdf?sfvrsn=6aa18912_2

China went from 75k to 81k cases, which is not exponential growth.
Korea went from 100 to 8800, which looks exponential, until seeing they had 6.3k cases halfway through.

Italy went from 3 to 47k cases.
U.S. went from 15 to 15k cases.

In each country, cases represent positive test results.  Without testing, the numbers stay artificially low.  When testing is adequate, the virus looks like it's moving much faster - because testing catches up.  The starting numbers in Italy and the U.S. are severe under counts that reflect a lack of testing at the time.

Which brings me to the bottom... isn't in.  To me, increased cases in the U.S. reflect accuracy - a higher rate of testing removes uncertainty about who is infected.  But the numbers will scare most people, and news stories based on old data will reinforce that fear.

cool...hope your right....but doubt it

Buffaloski Boris

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Re: Bottom is in!
« Reply #75 on: March 22, 2020, 12:28:19 PM »
Yes. You won't catch the absolute bottom, and neither should you try.

The person obsessed with buying right at the bottom is also the person who is going to take their 40% rebound profits after a 2 month rally. I'm looking to ride the next bull market for 400%, even if that takes another 10-15 years.

The overwhelmingly important thing is simply to have a plan to accumulate as much as you can throughout this crisis and then stick to it.

I've bought heavily into this crash with all the cash I was willing to put in, so I'm low on ammo now if it goes lower, but I absolutely do not regret the purchases I have recently made. That is what it was there for; to buy at what I consider a discount, not to try to pick the bottom. From here on my buying will mostly be my monthly pension contributions, and if stocks remain beaten down for the next year it doesn't change my plan one iota.

I do have 1yr of emergency cash, but that is what it says on the tin, and given that most of our employment prospects do not look that promising right now I'm happy to sit on it.

I haven’t started using my dry powder yet. I was and am low equities exposure. Patience is difficult  But necessary. I’m going to set up some limit orders shortly. Probably as a step function.

Jack0Life

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Re: Bottom is in!
« Reply #76 on: March 22, 2020, 05:38:25 PM »
Get ready for a huge drop tomorrow.
The Dow is already down to 18k during after hours.
The Dem won't pass off on the stimulus bill. If this bill doesn't get pass soon, it will get really ugly this week.

MaaS

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Re: Bottom is in!
« Reply #77 on: March 22, 2020, 06:16:03 PM »
Is the bottom in? I'm waiting at the moment and have a very large cash position that I've waited for a pull back to invest. I might be greedy waiting and could pay the price but there are too many variables such as bonds price, inverted yield curve, resession fears, small businesses are closing and skyrocketing unemployment. What happens if Democrats get in the office and tax rates change, all pe ratios change and another market correction. Dow 15000 is very real.

1. Buy some periodically
2. Wait for the negative news on markets to slow, such as new GDP, employment

Thoughts?

IMHO, we're not at the bottom.  And won't be for awhile.  I posted a graphic a week or so ago that showed the number of days on average from the start of a bear market to the bottom.  It isn't a matter of 1-2 weeks.  A large part of the US and other industrialized countries economies are being shut down and layoffs are coming down fast and hard. It's difficult to predict how markets will react: they're often counterintuitive and irrational.

The orthodoxy here is that you put it all in at once and you don't attempt to market timing.  Well, if I had followed the orthodoxy, I'd be royally screwed about now.  I was slowly DCAing back into the market when this hit, and I ended up having relatively low equities exposure as a result.  I got hit, but not slammed. I view that more as luck than anything. And also an expensive reminder to stick to my own counsel. 

I won't give advice, but will tell you my subject-to-change plans.  I think we're probably in for a depression.  A brief one, but technically a depression nonetheless.  I don't expect a V shaped recovery, but more of a U.  I viewed the CAPE as being at nosebleed levels, which was at the root of my reluctance to have anything to do with US equities.  I believe that US equities (as measured by SP 500) will be somewhere near reasonably priced at a CAPE of around 20.  We were at a CAPE of just under 22 as of Friday.  That implies about another 10% drop before I'm all that interested. Due to the very strong dollar, I think that US market will still be relatively pricey.  That also implies that international markets are cheap.  So, I plan to start DCAing about when the CAPE for the SP 500 hits around 20.  Most exposure will be developed international, with US exposure weighted towards small cap.  Very limited exposure to SP 500, but some small amount for diversification. I haven't figured out whether I tie DCA to a specific number.  I.e. CAPE or SP 500 at a lower number means a higher percentage allocation, but I suppose I will try to do it more or less mathematically.  In the end, I expect to have a relatively robust allocation to equities by 2021.

I agree it takes more than a few weeks for a bear market to run its course. But the speed of this bear market has been unprecedented, so I do think it will all play out a lot faster than past bears have. 

Maybe we aren't anywhere near a bottom, but the market does not go straight down just as it does not go straight up. I would at least expect a good bounce before a further selloff and the final bottom (A-B-C pattern).  I can see a scenario where that takes another 6 months to play out, so there would be some significant duration to the bear market.

European indices where events seems to be slightly ahead of the US are quite a bit off their lows and don't seem to want to go lower, at least for the time being.

Also, make no mistake that the fortunes of the stock market will be a massive factor in the Presidential election. Trump would regularly brag about the market as it was reaching new highs (remember him saying "it should be 10,000 points higher!") It has become a political asset or liability depending on its level. Rightly or wrongly, the Fed will be under tremendous pressure to reinflate asset prices before the election.

European indices also started from around 30% lower P/E ratios than the U.S. On a positive note, unless there are some late updates to the data, almost all major European countries lowered their daily number of infections today. Perhaps a sign that quarantine efforts are working? It'll be interesting to see how the European markets respond.

As far as a bottom - I invested a solid sum on Wednesday but am still holding a majority of my cash on hand.

In the spirit of the thread, my guess: Market tanks 7-8% tomorrow putting the SP500 at about 38-39% down. Congress will get it together and pass a stimulus deal, which gains back tomorrow's losses and maybe a little more over the next week.

At the end of the 15-day quarantine, we announce another 15-days, and that sends us to new lows. Maybe 45% by the time this is all over with?



JLE1990

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Re: Bottom is in!
« Reply #78 on: March 22, 2020, 06:34:04 PM »
The market's been steady all day today and boom at 3pm, it started cliff diving. Strange.
I have nothing to do but to watch the market all day long. LOL
I'm tempted to throw in $10k or $20k if it keeps free falling before 4pm.

DId anything happen at that time? It was probably when Trumbo decided to have a press conference.

Jack0Life

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Re: Bottom is in!
« Reply #79 on: March 23, 2020, 02:36:42 PM »
The market's been steady all day today and boom at 3pm, it started cliff diving. Strange.
I have nothing to do but to watch the market all day long. LOL
I'm tempted to throw in $10k or $20k if it keeps free falling before 4pm.

DId anything happen at that time? It was probably when Trumbo decided to have a press conference.

The Dem rejected a 2nd vote on the stimulus bill today.
I'm trying to stay the course and stick to what I said I do and buy back in stages.
The Dow dropped another modest 600 points hanging around 18,500 so I decided to transfer $35k over some Index funds. Trying hard not to be so greedy.and wait if it will ever drop to 15k

Stachless

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Re: Bottom is in!
« Reply #80 on: March 23, 2020, 04:26:21 PM »
This is starting to feel a bit like capitulation!  Horseshoes, hand grenades, and this bottom...we're close enough for this little piggy to shove more chips in.  Good luck to us all and #washyourhands!

MustacheAndaHalf

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Re: Bottom is in!
« Reply #81 on: March 24, 2020, 12:50:10 AM »
Yes. You won't catch the absolute bottom, and neither should you try.
...
I do have 1yr of emergency cash, but that is what it says on the tin, and given that most of our employment prospects do not look that promising right now I'm happy to sit on it.
I haven’t started using my dry powder yet. I was and am low equities exposure. Patience is difficult  But necessary. I’m going to set up some limit orders shortly. Probably as a step function.
I'm using up dry powder, but keeping lots of emergency fund in cash for rent/food.
Does dry powder include emergency cash, like vand mentioned?

vand

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Re: Bottom is in!
« Reply #82 on: March 24, 2020, 07:58:33 AM »
The Top Is In... but equally, so too is the bottom.

No, really... it might just be.
VIX has been retreating from its highs, indicating that the panic is slowly retreating even as we fell to marginal new lows, and the technical indicators show the downside momentum was fading.

People waiting for Dow15k to dump their money in might not get that chance.
« Last Edit: March 24, 2020, 08:02:05 AM by vand »

chairman5

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Re: Bottom is in!
« Reply #83 on: March 24, 2020, 08:52:57 AM »
a ways to go.  SP 1860 area.

Jack0Life

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Re: Bottom is in!
« Reply #84 on: March 24, 2020, 09:30:39 AM »
The Top Is In... but equally, so too is the bottom.

No, really... it might just be.
VIX has been retreating from its highs, indicating that the panic is slowly retreating even as we fell to marginal new lows, and the technical indicators show the downside momentum was fading.

People waiting for Dow15k to dump their money in might not get that chance.

YUP !!!
I've been guessing 15k Dow but I know I can't time the market.
Holding true to myself and buy back in stages.
Glad to put some back yesterday. Market is up big time today. Stimulus bill is about to get pass.

wienerdog

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Re: Bottom is in!
« Reply #85 on: March 24, 2020, 10:08:05 AM »


Trust me, Chloroquine is NOT approved by the FDA, and will NOT be used. 



https://www.youtube.com/watch?v=7h9UXkDaI5A

Today is the start to the end.  The next load comes by the end of this month from Israel.  If you are worried increase your intake of quercertin and zinc.  The mask is a sign of fear and fear does nothing for the immune system but weaken it.  Be smart not fearful.  Fear is exactly what the media thrives on because it drives their business and if you're listening to the media then you are living in ignorance but that is is exactly what they want.  Any doctor can prescribe off label.  Be smart don't take fish tank crap.  You can't fix stupid no matter how hard you try. 

Getting zinc inside the cell is the name of the game.  The immune system knows exactly what to do at exactly the right time but sometimes it just needs a little help to slow things down especially if you're not 100%.  Don't let the media make you less than 100%.

hodedofome

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Re: Bottom is in!
« Reply #86 on: March 24, 2020, 10:42:41 AM »
The VIX has been crashing for several days now, and was only a few points away from the October 2008 high. Of course the market continued to drop for many stocks (as well as the entire market) for the next 4 months after that, but many of the strongest stocks which would lead the market for the next decade (AAPL, AMZN, NFLX etc) did in fact bottom in October/November 2008.

vand

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Re: Bottom is in!
« Reply #87 on: March 24, 2020, 02:25:05 PM »
+11.37% on the Dow. Now that's what I call a rally!
The bears might just be exhausted, for now at least.

Think my Dow 18k "stand in the line" "line in the sand" call is looking pretty good right now.

Those expecting Dow 15k.. that needs a 28% fall from here.. I wouldn't be at all sure that we're going to get it.  We may have seen the point of maximum pessimism.



PS  Any chance we can get this thread merged with the other similar one?
« Last Edit: March 26, 2020, 05:01:57 AM by vand »

MustacheAndaHalf

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Re: Bottom is in!
« Reply #88 on: March 26, 2020, 04:04:50 AM »
The markets open at 9 am EST, so I'll use that as my clock: it's 2:45 am in New York, Thursday, March 19.
I'm predicting a market bottom in advance, today or tomorrow (Mar 19-20).
...
So, we'll see... In advance, I'm predicting Thurs/Friday will be the market bottom (March 19-20).
Vanguard Total Stock Market ETF (VTI) closed at $115.19 on Friday, March 20.  So per my earlier post, that's my prediction of the market bottom.

It's likely unemployment and rising virus numbers will cause more drops, and prove me wrong.  I believe testing will ultimately be the way through the panic and uncertainty, but markets will probably figure that out more slowly.
The stock market is up +8% since I called a bottom on March 20.
For those tracking airline stocks, Boeing is up +67% (from $95.01 to $158.73 at Wednesday's close).

Congress passed a bill providing aid to companies struggling during the COVID-19 crisis, and aid was specifically mentioned for the airline industry.
« Last Edit: March 26, 2020, 04:08:52 AM by MustacheAndaHalf »

vand

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Re: Bottom is in!
« Reply #89 on: March 26, 2020, 05:10:29 AM »
Remember that the markets are a future discounting mechanism

They will recover as soon as they see a potential end to the crisis, not wait for that crisis end to play out.

And that looks like it could already have started to happen, based on the leveling off in the rate of growth of the virus: https://alephblog.com/2020/03/25/an-optimistic-assessment-of-covid-19/

While observers are looking at the change in the headline numbers (first derivative), the market is working on the rate of change of those numbers (2nd derivative).

Brother Esau

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Re: Bottom is in!
« Reply #90 on: March 26, 2020, 08:08:50 AM »
Remember that the markets are a future discounting mechanism

They will recover as soon as they see a potential end to the crisis, not wait for that crisis end to play out.

And that looks like it could already have started to happen, based on the leveling off in the rate of growth of the virus: https://alephblog.com/2020/03/25/an-optimistic-assessment-of-covid-19/

While observers are looking at the change in the headline numbers (first derivative), the market is working on the rate of change of those numbers (2nd derivative).

Markets started seeing it on March 24. Bottom is in!

MustacheAndaHalf

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Re: Bottom is in!
« Reply #91 on: March 28, 2020, 07:06:16 AM »
Vanguard Total Stock Market ETF (VTI) closed at $115.19 on Friday, March 20.  So per my earlier post, that's my prediction of the market bottom.
Markets are up +10.2% (Friday's close) since I called the market bottom.  For me, I was calling the end of the panic in the market.  Panic should be a low point for the market, and a good time to buy.  But not always the lowest point... so far, it's holding.

After the stock market closed for the weekend, Congress and the President signed the CARES Act into law, which is a $2.2 trillion relief package.  The largest relief bill in history finally passed, which markets couldn't predict with certainty.  Markets will probably open higher on Monday.

vand

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Re: Bottom is in!
« Reply #92 on: March 28, 2020, 07:22:55 AM »
IMO the late selloff was because Trump invoked the Defense Protection Act to basically bully GM into being his bitch. Disgusting behaviour from a sitting president, and an action that would make any true socialist proud.  He knows his presidency is on the line, and investors are right to be very wary of buying into companies when there is a heightened risk that they will be forced to do the bidding of a madman.

NaN

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Re: Bottom is in!
« Reply #93 on: March 28, 2020, 07:30:11 AM »
@Joe Schmo  called it on March 16. I mean, not the bottom, 100k cases on March 27. He was SPOT on.

My best guess is the bottom is not in. I think at the least we go back to the bottom that occurred on the 23rd, and possible even a little more (maybe worst case SPX ~1800-1900). Why? I think we are only seeing the first effects of this disaster on the economy and the next set is a tsunami.



VaCPA

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Re: Bottom is in!
« Reply #94 on: March 28, 2020, 07:32:01 AM »
IMO the late selloff was because Trump invoked the Defense Protection Act to basically bully GM into being his bitch. Disgusting behaviour from a sitting president, and an action that would make any true socialist proud.  He knows his presidency is on the line, and investors are right to be very wary of buying into companies when there is a heightened risk that they will be forced to do the bidding of a madman.
I'm no fan of Trump but he really can't win. He moves slowly on the whole pandemic and gets killed for it(rightfully), then he actually does something right for once and gets called a 'madman'. There's a reason China was able to curb their outbreak so quickly, and it wasn't because they sat back and hoped free markets would do the right thing. I'm not sure how this affects the stock market, outside of GM. These volatile jumps and drops are knee jerk reactions to every development right now.

use2betrix

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Re: Bottom is in!
« Reply #95 on: March 28, 2020, 11:48:04 AM »
I think with all the earnings, jo reports, and car sale data coming in next week, it’ll be the true test to whether we’re at the bottom. If we can handle next weeks storm without more significant drops, and the coronavirus curve seems to flatten, the market will again start to rebound.

If the market continues to crash next week and the coronavirus situation doesn’t seem to improve - who knows how long until the rebound will begin...

bthewalls

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Re: Bottom is in!
« Reply #96 on: March 28, 2020, 03:30:18 PM »
I think with all the earnings, jo reports, and car sale data coming in next week, it’ll be the true test to whether we’re at the bottom. If we can handle next weeks storm without more significant drops, and the coronavirus curve seems to flatten, the market will again start to rebound.

If the market continues to crash next week and the coronavirus situation doesn’t seem to improve - who knows how long until the rebound will begin...

my friend, i live in northern Ireland on the border with republic of Ireland.  I can assure you the USA covid situation will not improve over the coming weeksin usa.  there is a low fatality rate until the hospitals reach capacity, then even moderate cases can become fatal though lack of being able to get even minimal care.  I completely underestimated it myself.  its not the severity of the illness, its the pace of infection that causes hospital services to become over run...

USA is in for a major ride...do not underestimate the coming death toll

Huskers1

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Re: Bottom is in!
« Reply #97 on: March 28, 2020, 03:59:26 PM »
Do any of you track the japaneese Nikkei 225? it's trading  is a day ahead of us essentially. Thursday was there down ady faolowing the rally of the week. Friday was up significantly again.

Is this a good inicator of what we will see in our Market? 

Cache_Stash

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Re: Bottom is in!
« Reply #98 on: March 28, 2020, 04:23:26 PM »
Is the bottom in? I'm waiting at the moment and have a very large cash position that I've waited for a pull back to invest. I might be greedy waiting and could pay the price but there are too many variables such as bonds price, inverted yield curve, resession fears, small businesses are closing and skyrocketing unemployment. What happens if Democrats get in the office and tax rates change, all pe ratios change and another market correction. Dow 15000 is very real.

1. Buy some periodically
2. Wait for the negative news on markets to slow, such as new GDP, employment

Thoughts?

IMHO, we're not at the bottom.  And won't be for awhile.  I posted a graphic a week or so ago that showed the number of days on average from the start of a bear market to the bottom.  It isn't a matter of 1-2 weeks.  A large part of the US and other industrialized countries economies are being shut down and layoffs are coming down fast and hard. It's difficult to predict how markets will react: they're often counterintuitive and irrational.

The orthodoxy here is that you put it all in at once and you don't attempt to market timing.  Well, if I had followed the orthodoxy, I'd be royally screwed about now.  I was slowly DCAing back into the market when this hit, and I ended up having relatively low equities exposure as a result.  I got hit, but not slammed. I view that more as luck than anything. And also an expensive reminder to stick to my own counsel. 

I won't give advice, but will tell you my subject-to-change plans.  I think we're probably in for a depression.  A brief one, but technically a depression nonetheless.  I don't expect a V shaped recovery, but more of a U.  I viewed the CAPE as being at nosebleed levels, which was at the root of my reluctance to have anything to do with US equities.  I believe that US equities (as measured by SP 500) will be somewhere near reasonably priced at a CAPE of around 20.  We were at a CAPE of just under 22 as of Friday.  That implies about another 10% drop before I'm all that interested. Due to the very strong dollar, I think that US market will still be relatively pricey.  That also implies that international markets are cheap.  So, I plan to start DCAing about when the CAPE for the SP 500 hits around 20.  Most exposure will be developed international, with US exposure weighted towards small cap.  Very limited exposure to SP 500, but some small amount for diversification. I haven't figured out whether I tie DCA to a specific number.  I.e. CAPE or SP 500 at a lower number means a higher percentage allocation, but I suppose I will try to do it more or less mathematically.  In the end, I expect to have a relatively robust allocation to equities by 2021.

The problem is that this isn't a bear market.  This is a reaction to the potential of a recession (depression for those of you that have a negative bent). No one knows how long this will last.  Positive information will feed market rallies and negative will feed market sell offs.  That's typical.  But because of the unknown, this may end with a sharp V within a few months or it may take a U over a few years.  The government funding of stemming the tide on the economy being killed off gives a reprieve and can be considered stimulative to the economy in the short term or only a stop gap in the long term.  This is all dependent on what we find out about the virus over the next few weeks to few months.  Take a guess is all this is about.  So trying to model it to the past is mostly a fools errand.

Joe Schmo

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Re: Bottom is in!
« Reply #99 on: March 28, 2020, 04:35:14 PM »
@Joe Schmo  called it on March 16. I mean, not the bottom, 100k cases on March 27. He was SPOT on.
Not bad for a biologist and an armchair statistician. I have an excel sheet that I update with new cases and the rate of increase in % and projections based on a stead 10/15/20% daily increase.
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.
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I have no such thing for the market a lot more complications in that there data...namely "delayed mortality"