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POLL: V shaped recovery or dead cat bounce?


phart010
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POLL: V shaped recovery or dead cat bounce?  

13 members have voted

  1. 1. V shaped recovery or dead cat bounce?

    • V shaped recovery
      3
    • Dead cat bounce
      11


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Homebrew Team · Posted

I have been wondering this as well.  I dumped some money in a few various positions when it was near bottom.  Overall I am up 40% on the that bulk investment.  I didn't go into it thinking I would pull out anytime soon, but the increase has been nuts. 

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There's no lower resistance besides 18.5k for the Dow. I think we're seeing a new upper resistance being set now. The next time we test 18.5k will be the tell of how low it can go.

We'll have a year to watch it play out. I don't think the psychological impact of this lockdown has been priced into the market. Does anyone thing boardwalks will be packed in July? August? Could the hospitality industry be restructured by this time next year? Las Vegas Sands is still a $47 stock right now. If you think that's the low, then yeah V, or even W shaped recovery inbound. But if you think that $47 is over priced then get ready for the dead cat.

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I think to have a V shape, we have go back to the way it was before the coronavirus. And we’ve seen millions of people file for unemployment. Some are making more money on unemployment than they were working.

Add to that all the small businesses that have closed their door permanently and all those big companies that relied on small businesses as their customer base. I don’t see how we return back to normal quickly from here. 
 

Now there’s a proposed $2000 monthly payment for everyone from the House. Since the House is democratic majority, I feel this represents the democratic stance. Joe Biden may likely be campaigning on the $2000 UBI. That said, he would win the election. Trump won’t be outdone by Biden, so he will probably also (reluctantly) support some form of UBI to keep Biden from gaining popularity. If everyone’s getting UBI, nobody’s gonna want to go back to work

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30 minutes ago, phart010 said:

Now there’s a proposed $2000 monthly payment for everyone from the House. Since the House is democratic majority, I feel this represents the democratic stance. Joe Biden may likely be campaigning on the $2000 UBI. That said, he would win the election. Trump won’t be outdone by Biden, so he will probably also (reluctantly) support some form of UBI to keep Biden from gaining popularity. If everyone’s getting UBI, nobody’s gonna want to go back to work

Man, that would be a hell of a UBI proposal.  I don't think I've ever seen serious discussions around more than $1000 per person (not household) and I think $500 per minor child.

But I definitely think that "this is the big one" for UBI proposals starting to sound more plausible to the public as they potentially "solve" a lot of layers of benefits-complexity (consolidates SSI/SSDI/UBI/WIC/EIC and probably a handful of other programs), while positioning lower paid people to actually be able to "stay home" when they are sick in the future and not sweat a missed paycheck in the same way they do now.

 

The thing with the current stimulus that I'm surprised is getting relatively little coverage are the 18-24 year olds who may technically be their parents' tax dependent but don't get the current stimulus round (and their parents don't get the $500 bump that they would for minor dependents).

Seems like a totally needless carve-out, when they so poorly implemented the original payout that dead people with tax returns from 2018 were paid a stimulus check...

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I expect this recovery to be short term. There will be awful earnings releases for at least the next two quarters due to the disruption of business and the supply chain. That doesn’t even factor in the increased unemployment and lower discretionary spending of the public. With that said, my investment strategy is long term. I’ll ride out the waves as they come.

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I don't know. I bought my first stocks last month on a gamble and lost, so I really don't trust my judgement on reading the stock market. I changed my strategy to buying nice stable dividend stocks while they are low and companies I truly believe in. The way i see it I cant possibly lose buying at@t, for example, unless they pull a Valiant or an Enron kinda thing. The dividends they pay out will eventually overcome any potential loss in value. Couple that with a few more stable dividend stocks and it is like having a savings account on crack that I can use to accumulate enough money to eventually have a downpayment for a house. Even if is a dead cat and ready to fall again, I come out way ahead after all dividends get paid out.

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11 hours ago, arch_8ngel said:

Man, that would be a hell of a UBI proposal.  I don't think I've ever seen serious discussions around more than $1000 per person (not household) and I think $500 per minor child.

But I definitely think that "this is the big one" for UBI proposals starting to sound more plausible to the public as they potentially "solve" a lot of layers of benefits-complexity (consolidates SSI/SSDI/UBI/WIC/EIC and probably a handful of other programs), while positioning lower paid people to actually be able to "stay home" when they are sick in the future and not sweat a missed paycheck in the same way they do now.

 

The thing with the current stimulus that I'm surprised is getting relatively little coverage are the 18-24 year olds who may technically be their parents' tax dependent but don't get the current stimulus round (and their parents don't get the $500 bump that they would for minor dependents).

Seems like a totally needless carve-out, when they so poorly implemented the original payout that dead people with tax returns from 2018 were paid a stimulus check...

I’m a hard centrist, and a firm believer in letting people do whatever they want as long as it doesn’t impede on the freedoms of other people doing the same.

I’ve been wealthy, and I’ve been poor. I know what it’s like to have a thriving business and what it’s like to live off food stamps.

I would love to see Universal Basic Income become a reality, and completely erase all other redundant social programs. I’d also like to see the nationalization and elimination of for profit hospitals, prisons, and universities.

I would imagine a baseline of $1500/mo. for adults and teens 16 or above, and $500/mo. per child from 15 and under would suffice as a comfortable baseline. It would provide a family of 4 $4000/mo.

This would require about $5t a year with the current US population. This is more than the entire US budget though, and We can not eliminate the Defense budget, or interest payments either.

So where does this extra money come from?

Imagine a world where people pay $0 income taxes from their paychecks, and the only thing that is taxed are transactions. The US GDP is $22t, take 35% of that right off the top and you get $7.7t

All transactions of every kind should be subject to an automatic 35% VAT tax. Meaning the tax is built into the price of the transaction and not added on “at the counter”. Whether you’re a person, nonprofit, or for profit corporation. Whether it’s a stick of gum, or the purchase of a $10,000,000,000 building in downtown Manhattan.

35% of all transactions automatically goes to taxes with zero wiggle room once a “return” period has passed, this way it can’t be sent out of the country before getting taxed anyway.

People will no longer need to do taxes, and only companies will be subject to paying taxes and keeping records.

Of course, this idea would never pass and is way to radical. Plus it would require perfect execution and cooperation with politicians, business people, and people of all levels of education...so it would never have a fighting chance.

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Also on topic:

I agree with W shape.

Stimulus money just hit. Economic recovery is short term guaranteed with trillions of dollars ready to be spent up.

But...No one is going to be going to restaurants, movie theaters, vacations, theme parks anymore. At least, not until an effective vaccine or herd immunity is achieved from the Coronavirus.

Not to mention the long impact this will have on society in the long term. Lots less social interaction after this is over...I’m probably not going to be shaking hands over a business agreement anymore.

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I think the economy is going to get worse, someone else can pick the shape. The money is not going to the people on the bottom and i think that is what is going to prevent this situation from turning around quickly. 

Only 4% of the applicants for the small business payroll grant qualified before the program ran out of money.

Millions of businessed will not be able to recover 

Florida was only able to process 33,000 unemployment apps out of over 800,000 because their system couldn't handle more.

The govt. solution to people being out of work is a 1,200 check. (That you probably won't receive if you are illegal, if you have a wage garnishment, if you didn't file taxes in 2018 (less SSI awardee's)

There are over 20,000,000 who lost their jobs.

The federal govt. and republican states are pushing to open their states which can start new waves of the virus and increase the time things have to be shut down.

There is a cradh in the oil market.

There are just so many issues, i don't see a quick recovery.

 

Edited by Californication
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Member · Posted
1 hour ago, Californication said:

There are just so many issues, i don't see a quick recovery.

I agree.

Today looks pretty good, by my portfolio. I don’t think being optimistic is wise right now. 

You can’t fix stupid... and we have a whole lot of it right now.

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Oh I have one other issue. Now people aren't talking about this, and this is just my econ-101 brain thinking, but they are going to cause inflatiom.

The govt. is already set to put like six trillion dollars or more into the economy. They are clearly going to cause some level of inflatuon. Is it 1%, 1.5% IDK. But things are going to get more expensive, people are not not going to have higher wages to match and mant people are going to be out of work so less things will be purchased in the economy slowing down recovery and lowering gdp whi h is inpart based on consumption.

Another thing to think about: Moss Adams one of the major accounting firms in the u.s. has already cut everyone's pay. That means this is starting to cross demographics.

https://goingconcern.com/tracker-job-cuts-pay-cuts-both-covid-19/

Edited by Californication
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  • 2 weeks later...

I mostly invest in funds. Being only 35, I have a long way to retirement and plan on just letting my retirement savings sit in my current investments. Most people can’t time the market and are better off holding on long term. I will look for individual stock opportunities should certain stocks get hit and become attractive.

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