The financial impacts of 2020 events?

[AvidIndoorsman]

I find it weirdly troubling how many people think we're going back to normal very quickly. i have young millenial friends my age talking about buying houses this spring, actually bidding on houses, i nearly shat my pants when they told me this.

with so much uncertainty, and the reality is that we could very well be on the eve of a massive recession, why gamble? whatever happened to preparing for the worst? damn millenials

Certainly you have to plan for the worst, and hope for the best.

Also not all industries are effected the same way, there are tons of people who are losing everything, but also those who are making money hand over fist. If you're in a tech or healthcare job I can certainly see why you would think this is a great time to purchase a home and in fact we need the people with means to spend right now.

 

[TOGIE]

Certainly you have to plan for the worst, and hope for the best.

Also not all industries are effected the same way, there are tons of people who are losing everything, but also those who are making money hand over fist. If you're in a tech or healthcare job I can certainly see why you would think this is a great time to purchase a home and in fact we need the people with means to spend right now.

I’m also just an overly conservative, not optimistic (pessimist?) who has felt 9-10 years of up and up economy is too long

So I’d say for the last 3 years I’ve felt buying a house is kinda dumb on the front range. Especially with the amounts of money down im seeing many friends put on the table, i.e like none. I mostly feel it’s dumb now cause why not hedge on maybe some better prices next year? Certainly it won’t be way more expensive?

It’s easy for me though, cause my wife and I are in no rush, and I’m really not yet stoked on home ownership regardless of prices - but when I do get in, I want in as cheaply as possible, if that’s even a thing one could wish for on the front range.

I guess my point is, I’m so hesitant and conservative with money and houses that it doesn’t take much for me to think someone is crazy

 

[AvidIndoorsman]

I’m also just an overly conservative, not optimistic (pessimist?) who has felt 9-10 years of up and up economy is too long

So I’d say for the last 3 years I’ve felt buying a house is kinda dumb on the front range. Especially with the amounts of money down im seeing many friends put on the table, i.e like none. I mostly feel it’s dumb now cause why not hedge on maybe some better prices next year? Certainly it won’t be way more expensive?

It’s easy for me though, cause my wife and I are in no rush, and I’m really not yet stoked on home ownership regardless of prices - but when I do get in, I want in as cheaply as possible, if that’s even a thing one could wish for on the front range.

I guess my point is, I’m so hesitant and conservative with money and houses that it doesn’t take much for me to think someone is crazy

I'm right there with you.

 

[SAJ-99]

Certainly you have to plan for the worst, and hope for the best.

Also not all industries are effected the same way, there are tons of people who are losing everything, but also those who are making money hand over fist. If you're in a tech or healthcare job I can certainly see why you would think this is a great time to purchase a home and in fact we need the people with means to spend right now.

Interestingly, Healthcare is certainly not making money hand over fist. Elective surgeries were put on hold (should start back up soon) and ER volumes outside CV-19 hotspots dropped by 60%. Crazy stuff that will be interesting to look at after the fact and see why. But I agree the job outlook for that sector remains strong. Silicon Valley also appears to be hit hard, at least in valuations. No one escaped this. If someone is buying a house it is because they still have strong collateral in either the job (HC or govt job) or stock options that still have value. Hard to say, but I hear a lot of people want to leave the hustle and bustle of big city and be Big Fin’s neighbor.

 

[VikingsGuy]

Interestingly, Healthcare is certainly not making money hand over fist. Elective surgeries were put on hold (should start back up soon) and ER volumes outside CV-19 hotspots dropped by 60%. Crazy stuff that will be interesting to look at after the fact and see why. But I agree the job outlook for that sector remains strong. Silicon Valley also appears to be hit hard, at least in valuations. No one escaped this. If someone is buying a house it is because they still have strong collateral in either the job (HC or govt job) or stock options that still have value. Hard to say, but I hear a lot of people want to leave the hustle and bustle of big city and be Big Fin’s neighbor.

Yup - I think the paper said Medtronic (one of the largest med device companies in the world) has seen a 60% drop in sales. Covid is only good for a vary small part of the medical system. It is killing the majority of it. For every ICU RN working triple shifts in NYC there are a dozen of regular floor RNs furloughed in hospitals and clinics all over the country.

 

[AvidIndoorsman]

Interestingly, Healthcare is certainly not making money hand over fist. Elective surgeries were put on hold (should start back up soon) and ER volumes outside CV-19 hotspots dropped by 60%. Crazy stuff that will be interesting to look at after the fact and see why. But I agree the job outlook for that sector remains strong. Silicon Valley also appears to be hit hard, at least in valuations. No one escaped this. If someone is buying a house it is because they still have strong collateral in either the job (HC or govt job) or stock options that still have value. Hard to say, but I hear a lot of people want to leave the hustle and bustle of big city and be Big Fin’s neighbor.

Agreed elective healthcare is suffering, I was thinking of my sisters company which is more healthcare services... they have like 10-20x business recently.

Definitely not the time to be a dermatologist.

 

[Europe]

One last comment and then I will bow out to the younger, more knowledge folks here. But as stated earlier I enjoy your posts, thanks fellows. Your insight might make me not feel the need to hide dollar bills and gold coins in the mattress

I did want to suggest to you fellows , not to overlook the new business ideas and business's that will spring up after all of this is over and I guarantee you, they will. for every action there is a re action and there will be opportunities in the future to make some money. Best of luck

 

[Randi]

If you are a CPA and your daily life involves the small business carnage I am seeing, you just cannot bring yourself to jump into the market right now. I hope I am wrong and I hope all the risk takers are rewarded greatly. My skepticism and conservatism, jaded by a life of small business consulting, does not let me move from cash right now. I'll probably kick myself, but if Wall Street earnings "adjustments" in May are even a fraction of the hammer that has dropped on Main Street, sanity would dictate a further decline. But, maybe Wall Street and Main Street are different worlds. Or, maybe sanity is not part of the equation.

My heart aches for some of these small businesses, none of which will recover to where they were, no matter the efforts DC folks want to say they are making. As sad of a business story as I've seen in 33 years as a CPA.

This post plus the comments made by April

scare me and encourage me. Not as an investor in the stock market but as an investor in myself . I am still thinking, searching, deciding and educating myself. At this point in my life people like April and my father and grandfather have generated a drive within me to "invest" in myself. A degree, several degrees, owning your own business. These three keep coming to the top in several surveys---. Accountant/ Auditor / CPA ---Environmentalist /Wildlife Biologist--Health care ( Nurse/Doctor/etc )---plus a couple others I have no interest in.

To own my own business as soon as I am able to do so has always been my goal

But the above post by Big Fin as well as the comments made by April, makes me wonder about doing so

As far as the Stock Market is concerned : Something not mentioned, that I can see anyway. is "Funds". At this point in my life this is the only thing I have followed. So, admittedly I do not have the knowledge of everyone else who has posted here.

 

[westbranch]

I think the skepticism of a V-shaped recovery (at least for the economy) is rising. The most shocking stat I saw was now the total job losses over the last 5 weeks equalled the total jobs gained since the last crisis. It seems a lot of those jobs were hourly workers and low-skilled positions. There are quite a few stories about small businesses applying for and receiving PPP loans and the employees being mad because they would have made more in unemployment. I guess those people didn't have the most fulfilling positions in terms of job satisfaction. We see the problems of a government response that is not well thought out and unintended consequences. PPP had hedge funds, venture capital startups, and even public corporations applying and receiving ten's of millions $. Expecting people to do what is morally right is apparently a fantasy. Now we have to wonder how do we get people back to work? Do wages have to increase? Do people even go back to eating at bars and restaurants? What does a "new normal" look like?

I have been thinking about this recently. If I was being told to go back to work at a $10/hr job so I could save the stock market and business profits not sure that I would have any motivation to do it. Shit, I left from a F500 corporate finance dept after taking on a new position and exceeding expectations and getting a 2% raise while we had record profits. Plus, elk season was coming up and I wasn't going to be able to take my full vacation since work was busy. So I walked, and had a new job a few weeks later, not an option everyone has. Many businesses barely raised wages in the last 10 years while things were supposedly great, now low paid employees should trust those employers to protect them from a virus that nobody has full information on? A lot of people with lower paying jobs live in multi-generation households, so they would be going out to increase the chance of exposing family members. If they do have health insurance, it probably has a high deductible and they don't have the cash to pay that and will avoid going to the doctor or ER. They know they can't get tested and most other people out there haven't been either. All of the commercials/news articles/corporate BS thanking "essential" workers at grocery stores, retail, fast food restaurants, gas stations, etc. rings insincere to me. Most of these people do not have other options. I don't know what the answer is, but it seems like it can't be more of the same.


Accountant/auditor/CPA is mentioned as a career. A lot of large regional and national CPA firms are currently furloughing and laying off employees and cutting remaining employee salaries without decreasing hours. And in some cases increasing hours. Based on similar decisions in 2008-2010, it will likely take 3-4 years for pay to be back at prior levels. In late March some of these firms had webcasts to all employees saying there would be no changes and then a couple weeks later they started sending people packing for "performance" reasons with no announcements. Some waited until April 15th even with the extended tax deadline. Then these firms will be wondering why employees that they kept on will be leaving the first chance they get in the next few years. Hopefully that means we can hire a couple that are looking for a job that has a bit better work/life balance.

Like I said in a different thread on investing, we still have 25 years to retirement, so we'll keep dumping 100% into stocks every month. We have tenants in a duplex that are all in healthcare. Their hours have been cut and one has been furloughed. For now they are getting the extra $600 of unemployment, which puts the one back at their base pay. But I am sure they won't go back to full staffing even when they start bringing people on for some of the "elective" stuff. And we have some room to work with our tenants on the rental if needed. Fortunate to be in a position where we probably aren't going to go backwards, and may come out ahead in all of this. Just one millennial's ramblings.

 

[TOGIE]

i will say, what is starting to really show up in the numbers for our household budget is lots and lots of extra savings

used to spend roughly 300-400 a month on commuting alone, numerous wedding trips now cancelled, numerous personal trips now cancelled, eating at home A LOT more, not driving to the in-laws, it's actually quite remarkable when i look at the numbers

is it pent up consumer demand just waiting to unleashed over the next 5 months? i think that's the million dollar question. for us i would say not really. for the country... maybe?

we're both still employed. I have no fear for my job; not yet concerned, but can't be AS confident for wifes over the next year. but overall how many people are as lucky as my wife and me right now? that's the other big question

 

[3855WIN]

https://twitter.com/x/status/1254415921357168640

 

[Glockster]

Dang! That will drive the market up or that is the way it seems this year.
When does that come out?

 

[SAJ-99]

https://twitter.com/x/status/1254415921357168640

The market knows bad data is coming. The first thing I think is "what does the market know?", and if that is isn't obvious, like now, then "what has the market priced in?". I think bad data is going to be overlooked unless it is unanticipated. As has been pointed out previous by a few people, a LOT of money has been "printed". If this is anything like 2008-2009, and it looks very similar so far, most of that is going to end up in financial assets.

 

[3855WIN]

There’ll be a lot of losers from all of this. Might be a few winners, as well. Medicine will be interesting.

https://twitter.com/x/status/1254838669925593090

 

[BigHornRam]

Millenial oil speculators were not the only ones taken for a ride.

Bank of China clients might have lost more than US$1 billion on crude bets

Bank of China’s estimate for the carnage to retail investors from the collapse in a product linked to US crude oil futures surged 11-fold to more than 7 billion yuan (US$1 billion), as it consolidated reports from its nationwide network, according to people familiar with the matter.

www.scmp.com

Bummer!

 

[3855WIN]

Some financial types trying to make a difference. Interesting.

The Secret Group of Scientists and Billionaires Pushing a Manhattan Project for Covid-19

They are working to cull the world’s most promising research on the pandemic, passing on their findings to policy makers and the White House.

www.wsj.com

 

[AdamJ007]

thank you for sharing, man. 2020 is a very tough year, a lot of people have suffered because of some really serious events, like Coronavirus pandemic. The economy of many states is in decline now, and a lot of people have lost a lot of money. I am a trader, and I am suffering from this pandemic too. It has turned the market upside down, and it's very difficult to predict what is going to happen next. I used to make a lot of money on Fondex ETFs Trade, which is one of the best trading platforms in the world. Unfortunately, things changed and it became much more difficult now.

 

[Deleted member 20812]

Some financial types trying to make a difference. Interesting.

The Secret Group of Scientists and Billionaires Pushing a Manhattan Project for Covid-19

They are working to cull the world’s most promising research on the pandemic, passing on their findings to policy makers and the White House.

www.wsj.com

I saw that yesterday. Good article.

 

[schmalts]

I saw that yesterday. Good article.

can't read it without subscribing. Can you copy and paste?

 

[3855WIN]

can't read it without subscribing. Can you copy and paste?

I don’t have a subscription, either. Don’t recall what site I found it on, but I was able to read it there. In summary:
A group of the brightest and most successful people in America have set aside their normal life and are pouring through all possibilities for a vaccine. They are finding the best and discarding the rest. Then they are streamlining the process to get a vaccine out faster. Most are left leaning politically, but one connection they have bird hunts with Don JR. This connection helped them fast track through the FDA.
Nothing has been discovered yet, but good to see that there’s a wide ranging group of talented people working on it.