Bull Market officially over!! Year heading negative.

[Low Hanging Fruit]

so sometime between right after I got off work and looked, and just now, the DOW, NASDAQ and S&P500 futures all went negative

think todays presser will undo that?.

or is the predictions about Monday going to come to pass

Naw, its the fact the way they are fighting the total disaster is racking up debt. I think it was like 20 trillion in CORPORATE debt rolling right now that has been exploding since this started. If some of the bigger players go belly up or default it will be bad.. really bad.. and the odds are creeping up on it happening. Which means the government would have to step in again and with all the money being printed by the to fight this already it would mean a crash course in hyper inflation.

[Zan15]

Naw, its the fact the way they are fighting the total disaster is racking up debt. I think it was like 20 trillion in CORPORATE debt rolling right now that has been exploding since this started. If some of the bigger players go belly up or default it will be bad.. really bad.. and the odds are creeping up on it happening. Which means the government would have to step in again and with all the money being printed by the to fight this already it would mean a crash course in hyper inflation.

Not to mention the airlines will start the layoff train by Monday. This is going to be a huge drag if its even 1/4 of the level of 2009.

Debt might be 20 trillion but that is over 5-10-20-30 years. Most of the really bad debt right now is sitting in a minority of companies in a few industries.
Most of that debt is also with companies that will have no problem rolling over the debt into new agreements and the remainder can be brought by the Fed (not creating money)

[jeezusisacasual]

Not to mention the airlines will start the layoff train by Monday. This is going to be a huge drag if its even 1/4 of the level of 2009.

Debt might be 20 trillion but that is over 5-10-20-30 years. Most of the really bad debt right now is sitting in a minority of companies in a few industries.
Most of that debt is also with companies that will have no problem rolling over the debt into new agreements and the remainder can be brought by the Fed (not creating money)

I worry about the credit ratings more then anything else regarding corporate debt issues. Airline layoffs will be a fucking disaster but the the Hub jobs from the food service to loading / unloading / sanitation etc then actual airline employment.

[Rasulis]

Too wet and cold (we had snow flurry this morning) to bike, run, climb or do yardwork. So it is time for the “What if Trivia”.

What would your return be as of 03/13/2020 if you had invested during toward the end of the housing crash recession (11/30/2009)? Here are the returns by sectors.

Consumer Discretionary – 665.2%
Industrials – 408.9%
Consumer Staples – 301.1%
IT – 763.1%
Energy – 4.3%
Materials – 238.7%
Financials – 458.1%
Communication Services – 197.9%
Health Care – 413.0%
Utilities – 291.6%

How about if you had invested in November 2016 at the end of the oil war, what would be the return on your investment as of 03/13/2020?

Consumer Discretionary – 29.9%
Industrials – 5.1%
Consumer Staples – 7.7%
IT – 84.7%
Energy – -52.7%
Materials – -1.9%
Financials – 14.9%
Communication Services – 0.7%
Health Care – 33.5%
Utilities – 16.5%

[Zan15]

Too wet and cold (we had snow flurry this morning) to bike, run, climb or do yardwork. So it is time for the “What if Trivia”.

What would your return be as of 03/13/2020 if you had invested during toward the end of the housing crash recession (11/30/2009)? Here are the returns by sectors.

Consumer Discretionary – 665.2%
Industrials – 408.9%
Consumer Staples – 301.1%
IT – 763.1%
Energy – 4.3%
Materials – 238.7%
Financials – 458.1%
Communication Services – 197.9%
Health Care – 413.0%
Utilities – 291.6%

of course at this point you would be down about 60% of your investment so you would have to factor in that to those gains, unless you are talking about all new money all at once which very little of the population has the ability to do that.


if you were sitting on 100k as of 11/2009 you would have 40k left.
You'd need 250% just to start breaking even.

[Rasulis]

of course at this point you would be down about 60% of your investment so you would have to factor in that to those gains, unless you are talking about all new money all at once which very little of the population has the ability to do that.


if you were sitting on 100k as of 11/2009 you would have 40k left.
You'd need 250% just to start breaking even.

True. However, keep in mind all market crashes were preceeded by boom period. Although 2002 – 2007 overall was not a great time for the stock market.

Consumer Discretionary – 78.3%
Consumer Staples – 40.4%
Energy – 242.2 (oil was king back then)
Financials – 92.6% (fueled by the housing boom)
Health Care – 41.4%
Industrials – 125.9%
IT – 145.4% (still reeling from the dot/com bust)
Materials – 162.3%
Communication Services – 117.8%
Utilities – 172.1%

Now 1990 to 2000 was a great decade for the stock market.

Consumer Discretionary – 444.9%
Consumer Staples – 175%
Energy – 134.1
Financials – 608.2%
Health Care – 337.5%
Industrials – 357.4%
IT – 1,697.2% (not a typo)
Materials – 133.3%
Communication Services – 299.7%
Utilities – 63.6%

[Zan15]

True. However, keep in mind all market crashes were preceeded by boom period. Although 2002 – 2007 overall was not a great time for the stock market.

Consumer Discretionary – 78.3%
Consumer Staples – 40.4%
Energy – 242.2 (oil was king back then)
Financials – 92.6% (fueled by the housing boom)
Health Care – 41.4%
Industrials – 125.9%
IT – 145.4% (still reeling from the dot/com bust)
Materials – 162.3%
Communication Services – 117.8%
Utilities – 172.1%

Now 1990 to 2000 was a great decade for the stock market.

Consumer Discretionary – 444.9%
Consumer Staples – 175%
Energy – 134.1
Financials – 608.2%
Health Care – 337.5%
Industrials – 357.4%
IT – 1,697.2% (not a typo)
Materials – 133.3%
Communication Services – 299.7%
Utilities – 63.6%

and in 3 months that 1,697% was -70%



that's why timing the market is so bad

[Rasulis]

and in 3 months that 1,697% was -70%



that's why timing the market is so bad

30% of 1,697% was still 509%. That's why we don't try to time the market. Instead we let it ride. Even through the bad times. Unless you are still in Energy now. Then get off fast. Actually get a time machine and get off in 2010.

[Zan15]

30% of 1,697% was still 509%. That's why we don't try to time the market. Instead we let it ride. Even through the bad times. Unless you are still in Energy now. Then get off fast. Actually get a time machine and get off in 2010.

no no IT during that time frame peaked at 1700% and then dropped 70-80-90% total so freaking fast so the total return was less than a few hundred in what seemed like overnight.

some people saw those gains almost evaporate in their funds on a weekly basis

though if they were smart you are right they took 500% and bailed soon enough
but that's back to the whole timing thing.

500% would also assume that you stopped putting money into the system on a paycheck to paycheck basis

all new money would have been losing massive amounts of value, thus cutting the hell out of that 500%

- - - Updated - - -

damit inc 3000 point drop in the dow ….

https://www.yahoo.com/news/doctor-sa...233514803.html

[apeiron1234]

I really really hope the economy tanks and people lose their jobs and health because I hate that evil drumpfler!
[Infraction]

[Orbitus]

I really really hope the economy tanks and people lose their jobs and health because I hate that evil drumpfler!

Said no one ever, not even in this thread. We know you are a Trump supporter trying to be sarcastic. But Trump's actions have directly contributed to the economy's downfall.

[jonnysensible]

I'm glad capitalism is reliable during global crisis

If you had a degree in economics you would know the stock market is like a cow, if you sneak up on it and spook it a bit it stops making milk.

[Rasulis]

no no IT during that time frame peaked at 1700% and then dropped 70-80-90% total so freaking fast so the total return was less than a few hundred in what seemed like overnight.

some people saw those gains almost evaporate in their funds on a weekly basis

though if they were smart you are right they took 500% and bailed soon enough
but that's back to the whole timing thing.

500% would also assume that you stopped putting money into the system on a paycheck to paycheck basis

all new money would have been losing massive amounts of value, thus cutting the hell out of that 500%

- - - Updated - - -

damit inc 3000 point drop in the dow ….

https://www.yahoo.com/news/doctor-sa...233514803.html

Rather that argue over it, it is easier to plug in an ETF that closely matches the up and down of the tech sector, such as FSCSX, into an ETF calculator. According to First Republic ETF calculator, if I invested $300 per month in FSCSX between March 13, 1990 and March 13, 2020 (total investment $108,000), reinvesting the dividend back into the stock, and accounting for the fee, I would have over $1M in my account.

That's not accounting the tax deduction if I had bought the fund for my IRA and 401k. Stock downturn is not all bad either. It allows you to double dip with your retirement funds. While stock values are high, you invest in regular retirement funds and deduct your taxes using the higher values. As soon as the stock values drop, you transfer the funds from your regular retirement accounts to Roth accounts at lower tax liabilities.

[D Luniz]

I really really hope the economy tanks and people lose their jobs and health because I hate that evil drumpfler!

so are you just going to every thread in Politics to go "hur dur liberals hate trump!!"?

cause there is a word for that

[Zaydin]

so are you just going to every thread in Politics to go "hur dur liberals hate trump!!"?

cause there is a word for that

Unfortunately, saying that is somehow worse than the act of what he's doing.

[Breccia]

This CNN (real news) article goes into more precise detail what we've been talking about: the coronavirus didn't kill the economy, it was the catalyst.

To summarize: the world's corporations took advantage of the low rates since 2009 to borrow an extra few trillion dollars -- which is the point of having low rates. But they didn't really pay it all back. Meaning, when recent news hit, many suddenly found themselves facing not just higher debt than they should have, but worse, suddenly lost the ability to pay it back.

Travel and hospitality are in the most direct trouble, and oil companies not far behind them. Trump just announced plans to buy a bunch of oil -- and for the record, by selling off a bunch of the reserve while the price was still high, that actually worked out fairly well (for the US govt at least) -- but that's not going to be enough. Inability to pay their bonds or loans will drop their value and credit rating. And the reason you see bank stock lowering, is because either they'll have to let these now proven higher-risk loans stay in their portfolio, or collect by seizing assets that are demonstrably worth less than the loan's balance.

They also point out how some investment companies have contracts with their customers that restrict how many BBB bonds, the lowest rating there is, they will allow themselves to purchase. In some cases, that amount is "none". A lot of them are already there. Dumping those bonds, like killing someone's credit rating, makes it harder to sell more or get loans, causing, well, oil to lose liquidity, odd a phrase as that is.

Overborrowing to the point of recession is part of the normal cycle, but it's moving much faster now than it's supposed to.

The good news, is while there is growing risk of world recession (and the US is part of the world), it's not supposed to be as bad as the last one.

[Omega10]

The good news, is while there is growing risk of world recession (and the US is part of the world), it's not supposed to be as bad as the last one.

I hope this low bar comes to pass. I am quite pessimistic about how bad this will turn out to be.

After all, it wasn't that long ago that Boeing was almost $400 and expected to soar over $500.

[Rasulis]

I hope this low bar comes to pass. I am quite pessimistic about how bad this will turn out to be.

After all, it wasn't that long ago that Boeing was almost $400 and expected to soar over $500.

I tend to agree with the CNN article. The current downturn or bear market does not have the feel of the 2008 recession. It feels more like a milder 2000 dot.com bust. A huge amount of capital was lost, but it did not affect the day-to-day life of most people.

- - - Updated - - -

This CNN (real news) article goes into more precise detail what we've been talking about: the coronavirus didn't kill the economy, it was the catalyst.

To summarize: the world's corporations took advantage of the low rates since 2009 to borrow an extra few trillion dollars -- which is the point of having low rates. But they didn't really pay it all back. Meaning, when recent news hit, many suddenly found themselves facing not just higher debt than they should have, but worse, suddenly lost the ability to pay it back.

Travel and hospitality are in the most direct trouble, and oil companies not far behind them. Trump just announced plans to buy a bunch of oil -- and for the record, by selling off a bunch of the reserve while the price was still high, that actually worked out fairly well (for the US govt at least) -- but that's not going to be enough. Inability to pay their bonds or loans will drop their value and credit rating. And the reason you see bank stock lowering, is because either they'll have to let these now proven higher-risk loans stay in their portfolio, or collect by seizing assets that are demonstrably worth less than the loan's balance.

They also point out how some investment companies have contracts with their customers that restrict how many BBB bonds, the lowest rating there is, they will allow themselves to purchase. In some cases, that amount is "none". A lot of them are already there. Dumping those bonds, like killing someone's credit rating, makes it harder to sell more or get loans, causing, well, oil to lose liquidity, odd a phrase as that is.

Overborrowing to the point of recession is part of the normal cycle, but it's moving much faster now than it's supposed to.

The good news, is while there is growing risk of world recession (and the US is part of the world), it's not supposed to be as bad as the last one.

I almost spit my coffee out when I read Whiting Petroleum stock is now worth 75 cents and Chesapeake 15 cents. In 2014 at the peak, Whiting stock was over $350 and Chesapeake was $62.

[Vash The Stampede]

This CNN (real news) article goes into more precise detail what we've been talking about: the coronavirus didn't kill the economy, it was the catalyst.

About the only thing CNN got right.

To summarize: the world's corporations took advantage of the low rates since 2009 to borrow an extra few trillion dollars -- which is the point of having low rates. But they didn't really pay it all back. Meaning, when recent news hit, many suddenly found themselves facing not just higher debt than they should have, but worse, suddenly lost the ability to pay it back.

That's because we've been in a recession since 2008 and slowly as the quantitative easing was removed, the banks went right back into a meltdown. That's why the repo market crashed back in September of 2019 because the banks are now dependent on quantitative easing. Don't get too upset over the $1.5 Trillion that was used to boost the market when over $4 Trillion was used to save the repo market.

Travel and hospitality are in the most direct trouble, and oil companies not far behind them. Trump just announced plans to buy a bunch of oil -- and for the record, by selling off a bunch of the reserve while the price was still high, that actually worked out fairly well (for the US govt at least) -- but that's not going to be enough.

It won't because it seems Russia is now using their power to disrupt the oil market to get back at America. As long as Russia and Saudi Arabia keep the prices low, there's no amount of oil buy back that'll save this situation.

The good news, is while there is growing risk of world recession (and the US is part of the world), it's not supposed to be as bad as the last one.

The last one never ended, which is why you see so many problems over a virus. As Yanis Varoufakis a real economist said, "the coronavirus is going to accelerate the post 2008 crisis, now don't let anyone tell you that one ended and now we have a new one". Our financial system has cracks and the coronavirus spread them wide open. The virus won't go away in 2 weeks, let alone 2 years, because producing a vaccine and distributing it is not financially beneficial. So everyone is going to panic for a long time, while they have to go to work and get paid, which is just going to continue to spread the virus. Once the virus is under control it doesn't mean everything goes back to the way it was because the rich don't want to spend the money. The rich won't pay back the quantitative easing which just creates more inflation and therefore more problems. This is a negative self feeding cycle that'll bring us the end of capitalism.

[Zan15]

d oil companies not far behind them. Trump just announced plans to buy a bunch of oil -- and for the record, by selling off a bunch of the reserve while the price was still high, that actually worked out fairly well (for the US govt at least) -- but that's not going to be enough. Inability to pay their bonds or loans will drop their value and credit rating. And the reason you see bank stock lowering, is because either they'll have to let these now proven higher-risk loans stay in their portfolio, or collect by seizing assets that are demonstrably worth less than the loan's balance.

They also point out how some investment companies have contracts with their customers that restrict how many BBB bonds, the lowest rating there is, they will allow themselves to purchase. In some cases, that amount is "none". A lot of them are already there. Dumping those bonds, like killing someone's credit rating, makes it harder to sell more or get loans, causing, well, oil to lose liquidity, odd a phrase as that is.

Overborrowing to the point of recession is part of the normal cycle, but it's moving much faster now than it's supposed to.

The good news, is while there is growing risk of world recession (and the US is part of the world), it's not supposed to be as bad as the last one.

Meh, the fed will just step in and start buying low rated bonds just like they did to bail out the banks and mortgage companies in 2009-2010 when it was found that most of their repackaged mortgages into debt packages should have been rated much lower than they were.