What a difference 2 months Makes

[catfish1957]

In the past few weeks, I have upped the chance of a "V"shaped recovery from about 30% to 60%. The past few months of recovery since the March 23rd bottom have been nothing short of remarkable.  We still likely will have some rough sailing ahead, but I am getting more optimistic by the day:

Here is the tale of the tape

                  March 23.             Now             Result
                 ========.       ======.     =====
DJIA.           18,591                   25,230.       +35.7%
S&P              2,237                     2,996.        +26.4%
NASDQ.        6,860                      9,340.       +36.2%
                     

[Hoodat]

What a difference ten years makes

	2000	Now	Result	Annual Rate of Return
DOW	10,137	25,230	+149%	9.55%
S&P 500	1,089	2,996	+175%	10.65%
NASDAQ	2,257	6,860	+ 204%	11.76%

[Absalom]

Respectfully, as TBR is an opinion site, all are entitled.
Yet the notion that the Covid recovery will be V shaped is light years beyond preposterous.
Ignoring China for the moment, this was an act of Nature and in all such events, be they
earthquakes, hurricanes/tornadoes, volcanic eruptions, plagues, floods, among many;
Man is reminded by Nature who is superior.
As a cequence, beyond the loss of life, his psyche is damaged, leaving a residue of fear
producing anxiety, pause and reflection.
Manipulating various numbers is nothing by an exercise in arithmetic; telling us nothing
as to how Man will behave and react once this plague subsides.

[truth_seeker]

Manipulating various numbers is nothing by an exercise in arithmetic; telling us nothing

Thanks for sharing

[catfish1957]

Respectfully, as TBR is an opinion site, all are entitled.
Yet the notion that the Covid recovery will be V shaped is light years beyond preposterous.
Ignoring China for the moment, this was an act of Nature and in all such events, be they
earthquakes, hurricanes/tornadoes, volcanic eruptions, plagues, floods, among many;
Man is reminded by Nature who is superior.
As a cequence, beyond the loss of life, his psyche is damaged, leaving a residue of fear
producing anxiety, pause and reflection.
Manipulating various numbers is nothing by an exercise in arithmetic; telling us nothing
as to how Man will behave and react once this plague subsides.

Lot of flowery non-financial, non-technical, reasoning there saying why it won't be a "V" recovery.  If you saw my orignal post, I said  I am not 100% certain either.  But I have been watching this stuff 40 years, and have done it long enough to watch how fundementals impact market movement.  Calling an abrupt recovery preposterous, is tad out there to say the least......... 

Base consumption numbers are spiking up, and that typically dominoes up the food chain. Then add the fact that the majority of investors are in for the lot haul. 30+ years.  Yes, recent exuberance may be overstated, but one overiding fact remains.....   If you box any 10 year period from the depression to today, there has beeb an  increase in the DJIA.  There is always anxiety in investing, but the years of burying or putting your nest egg in a matress is ancient history.

In fact your last sentence substantuates the fact, you have no idea where the market will go.  Because, honestly....no one can predict the market past a few days anyway.  It's just the nature of the beast, and subject as you stated to unforseen events.

Myself?  2 months ago, my money would have been on a "U", Now...   I think it is the least likely.  Watch for a "V", or if a second COVID-19 wave hits, a "W".  Hey, but if an asteroid hits the earth......   

I'd like to hear a little more on where you think the markets are trending.  Sounds like you are a serious Bear.

[Hoodat]

My prediction is that the DOW hits 30k by this time next year.  Ten year numbers were provided as a reminder that there is a huge difference between investing and gambling.  Stocks are for the long term.  For anyone contributing to a 401(k), they will come out better over the course of a year with the huge dip (i.e. bargain prices for stocks) and corresponding increase than they would have with no dip at all.

[catfish1957]

My prediction is that the DOW hits 30k by this time next year.  Ten year numbers were provided as a reminder that there is a huge difference between investing and gambling.  Stocks are for the long term.  For anyone contributing to a 401(k), they will come out better over the course of a year with the huge dip (i.e. bargain prices for stocks) and corresponding increase than they would have with no dip at all.

Absolutlely.  If I wouldn't have been retired, I'd done some serious movement into some oversold stocks late in March. Just didn't have the balls to put some high paying fixed income instruments at risk.   

In fact, one of my kids sank about a 1/3 of his net worth at the dip.  He's now one perpetual high-fiving fool. 

[Hoodat]

In fact, one of my kids sank about a 1/3 of his net worth at the dip.  He's now one perpetual high-fiving fool.

That kid has a good dad.

[roamer_1]

Myself?  2 months ago, my money would have been on a "U", Now...   I think it is the least likely.  Watch for a "V", or if a second COVID-19 wave hits, a "W".  Hey, but if an asteroid hits the earth......   

I think it will bounce pretty good and get a lot of air. It will look super on paper.

But they need to knock the chocks out for that to work, the problem being filling the pipeline. Similar in fashion to groceries right now.

I hit the powdered sugar lottery yesterday. Swiped up three bags while it was there... I've been out and looking for months. That's ridiculous, right?

Same thing goes for industry. Until it's all up and running, it will be plagued by shortages, predictably. If the factories and warehouses in big liberal cities are still idling, that will effect supply across the board. It is a bother.

Even here. Everything comes through Billings, Missoula, or Spokane - all the effective hot-spots in the area. What that does to delivery up in here is notable.

[catfish1957]

That kid has a good dad.

Wow, thanks Hoodat.  I am proud that they all are investor savvy, and understand the value of a $, 

[catfish1957]

Same thing goes for industry. Until it's all up and running, it will be plagued by shortages, predictably. If the factories and warehouses in big liberal cities are still idling, that will effect supply across the board. It is a bother.

Even here. Everything comes through Billings, Missoula, or Spokane - all the effective hot-spots in the area. What that does to delivery up in here is notable.

It has really been strange on how certain items become short, and some plentiful. Early on it was TP.  Now no problem.   2 or 3 weeks ago, I couldn't score a bag of shredded cheese within 25 miles.  Now, (and expected), its hamburger.  As the shutdown wanes, I expect fewer and fewer supply chain disruptions.  I happy to go on record to say, that the attempt of the dims to shutdown the American economy for political gain, is not only going to fail, but might backfire mightily

[Cyber Liberty]

It has really been strange on how certain items become short, and some plentiful. Early on it was TP.  Now no problem.   2 or 3 weeks ago, I couldn't score a bag of shredded cheese within 25 miles.  Now, (and expected), its hamburger.  As the shutdown wanes, I expect fewer and fewer supply chain disruptions.  I happy to go on record to say, that the attempt of the dims to shutdown the American economy for political gain, is not only going to fail, but might backfire mightily

People are not appreciating the trial period of Socialism.

[roamer_1]

It has really been strange on how certain items become short, and some plentiful. Early on it was TP.  Now no problem.   2 or 3 weeks ago, I couldn't score a bag of shredded cheese within 25 miles.  Now, (and expected), its hamburger.  As the shutdown wanes, I expect fewer and fewer supply chain disruptions.

I think that's right... But considering factories and warehouses in liberal cities, and maybe more importantly, disruptions overseas, effect the stretch. Create stumbling blocks. I am not saying they are insurmountable, but still and all, a tarp maker in Texas needs them brass eyelets... Likely imported from china or Taiwan... And if they cannot come from there, the next choice is going to be a liberal city up in the rust belt somewhere... And the next choice after that? [???]... Maybe waiting a while before going full bore.

And there are overages to consider too - Cheap fuel right now. Great, right? Yes it is for kick-starting ailing businesses... Bit it also means the oil industry is gonna be sagging for at least a quarter while oversupply gets consumed.

Shoot as much TP as everybody bought up, Charmin will be laying off for a long time.

It's a monkey knot. Who knows how it shakes out? It WILL shake out, no doubt. It's the stretch that is unknown.

I happy to go on record to say, that the attempt of the dims to shutdown the American economy for political gain, is not only going to fail, but might backfire mightily

**Divided for emphasis.

I will join you in that prediction, and in fact, I think the mighty backfire is surely coming. And probably sooner than later. Liberals always overreach. And already folks in the city are at 'hell no'. I think that length of 'stretch' is directly proportional to how far liberals can beat this dead horse before city folks hit 'Oh hell no'. The longer it goes, the slower the recovery... but the longer it goes the more fiery the backlash. Makes me kinda undecided which way to root for. 

[Absalom]

Lot of flowery non-financial, non-technical, reasoning there saying why it won't be a "V" recovery.  If you saw my original post, I said  I am not 100% certain either.  But I have been watching this stuff 40 years, and have done it long enough to watch how fundamentals impact market movement.  Calling an abrupt recovery preposterous, is tad out there to say the least......... 
Base consumption numbers are spiking up, and that typically dominoes up the food chain. Then add the fact that the majority of investors are in for the lot haul. 30+ years.  Yes, recent exuberance may be overstated, but one overiding fact remains.....   If you box any 10 year period from the depression to today, there has beeb an  increase in the DJIA.  There is always anxiety in investing, but the years of burying or putting your nest egg in a matress is ancient history.
In fact your last sentence substantuates the fact, you have no idea where the market will go.  Because, honestly....no one can predict the market past a few days anyway.  It's just the nature of the beast, and subject as you stated to unforseen events.
Myself?  2 months ago, my money would have been on a "U", Now...   I think it is the least likely.  Watch for a "V", or if a second COVID-19 wave hits, a "W".  Hey, but if an asteroid hits the earth......   
I'd like to hear a little more on where you think the markets are trending.  Sounds like you are a serious Bear.

--------------------------------
As I began, all are entitled to their opinion and you heard mine; so let me begin at your end.
I have absolutely no interest in the Dow (or the How and the Wow), as it
represents the essence of materialism, the fundamental reason we have
become a valueless nation/state addicted to "more stuff" and little else.
I have no idea where the Dow is heading and care less.
For me, the message from COVID is plain and simple which is that I am mortal, yet remain
responsible for setting an example for my family that encourages them to survive and thrive.

[berdie]

--------------------------------
As I began, all are entitled to their opinion and you heard mine; so let me begin at your end.
I have absolutely no interest in the Dow (or the How and the Wow), as it
represents the essence of materialism, the fundamental reason we have
become a valueless nation/state addicted to "more stuff" and little else.
I have no idea where the Dow is heading and care less.
For me, the message from COVID is plain and simple which is that I am mortal, yet remain
responsible for setting an example for my family that encourages them to survive and thrive.

As I have said in the past, I enjoy your historical posts @Absalom . But could you explain your opinion to me? Of course materialism is not a good thing. But people have to live.  That entails companies doing well so people can make a living. Many older retired people depend on the market, not for materialistic pursuit, but for food and shelter. Cash/stocks/bonds etc. are necessary in order to live.

Setting an example is a worthy and necessary endeavor. But in doing so, shouldn't that include survival?

[txradioguy]

IMHO how well the economy comes back will depend a lot on who is in the WH next January.

[Absalom]

As I have said in the past, I enjoy your historical posts @Absalom . But could you explain your opinion to me? Of course materialism is not a good thing. But people have to live.  That entails companies doing well so people can make a living. Many older retired people depend on the market, not for materialistic pursuit, but for food and shelter. Cash/stocks/bonds etc. are necessary in order to live.
Setting an example is a worthy and necessary endeavor. But in doing so, shouldn't that include survival?

-----------------------------
Certainly survival is paramount yet didn't the Ancients also survive?
The earliest cultures/societies of the Fertile Crescent up to the Enlightenment spanned
some 10,000 years, warts and all.
Many factors let them survive and thrive, most prominently their spiritual sensibilities.
Then the Enlightenment arrived touting material betterment as Man's higher calling and
for some, his salvation.
This idea has ruled the world ever since and in my judgement hardly for the better.
Let me leave you w/2 thoughts.
* Assessing the quality of Art and Science pre and post Enlightenment;
which era was/is infinitely superior?
*  Assessing religion, is the modern Roman Catholic Church superior to
its predecessor (as well, is the Pontiff himself a Catholic?)
Stay well!

[txradioguy]

I happy to go on record to say, that the attempt of the dims to shutdown the American economy for political gain, is not only going to fail, but might backfire mightily

I hope you're correct.  But I'm seeing far too many once rational people I know buying into the panic.  Whether it's the lockdown or virtue signaling with masks.

They've become infected with fear.

[berdie]

-----------------------------
Certainly survival is paramount yet didn't the Ancients also survive?
The earliest cultures/societies of the Fertile Crescent up to the Enlightenment spanned
some 10,000 years, warts and all.
Many factors let them survive and thrive, most prominently their spiritual sensibilities.
Then the Enlightenment arrived touting material betterment as Man's higher calling and
for some, his salvation.
This idea has ruled the world ever since and in my judgement hardly for the better.
Let me leave you w/2 thoughts.
* Assessing the quality of Art and Science pre and post Enlightenment;
which era was/is infinitely superior?
*  Assessing religion, is the modern Roman Catholic Church superior to
its predecessor (as well, is the Pontiff himself a Catholic?)
Stay well!

Thank you for your reply and I will give an answer tomorrow as my self imposed computer time has expired, lol.

[catfish1957]

--------------------------------
As I began, all are entitled to their opinion and you heard mine; so let me begin at your end.
I have absolutely no interest in the Dow (or the How and the Wow), as it
represents the essence of materialism, the fundamental reason we have
become a valueless nation/state addicted to "more stuff" and little else.
I have no idea where the Dow is heading and care less.
For me, the message from COVID is plain and simple which is that I am mortal, yet remain
responsible for setting an example for my family that encourages them to survive and thrive.

@Absalom

I certainly welcome your opinion, and I fully can see your point.  OTOH, not everyone who invests in the markets is Gordon Gecko.  My incentive was being able to retire at young age, and enjoy the last 20 or 30 years of my life in leisure.  I also hope to leave enough of an estate to make sure my children won't ever suffer finacially. 

I am an extremely frugal indiviudal, so the concept of extreme materialism you mention does not apply to me, or to most of the people who particpate in this level of investing.  OTOH.....  It does not hurt to be smart enough, and knowledgeable enough around these matters to do your best to preserve the capital base to live on the interest, dividends, etc.

So basically your last sentence is identical to my intent to do well in investing.  Encouragment to thrive, and survive.  The thrive part, typically requires a sound monetary base.

[truth_seeker]

I am graateful for parents and grandparents, that taught me and showed me  the value of working, earning, saving, investing in stocks/bondestate.s and real estate.

Same for my wife's family.

Immigrants, veterans. Highly educated, not so highly educated. A college professor, a cowboy for example. 

 

[Hoodat]

I also hope to leave enough of an estate to make sure my children won't ever suffer financially.

Think how much easier that prospect would be if you were allowed to invest the 12.5% of your income that the government confiscates (at the point of a gun) as part of the Social Security Ponzi Scheme?  There is nothing in our country that goes further to ensure cyclical poverty than does Social Security.

[catfish1957]

Think how much easier that prospect would be if you were allowed to invest the 12.5% of your income that the government confiscates (at the point of a gun) as part of the Social Security Ponzi Scheme?  There is nothing in our country that goes further to ensure cyclical poverty than does Social Security.

100% right.  I won't be drawing for a few years, but the way the government indexes all SS as taxable @ >$34K?

Double taxation to boot.

[Absalom]

@Absalom
I certainly welcome your opinion, and I fully can see your point.  OTOH, not everyone who invests in the markets is Gordon Gecko.  My incentive was being able to retire at young age, and enjoy the last 20 or 30 years of my life in leisure.  I also hope to leave enough of an estate to make sure my children won't ever suffer finacially. 
I am an extremely frugal indiviudal, so the concept of extreme materialism you mention does not apply to me, or to most of the people who particpate in this level of investing.  OTOH.....  It does not hurt to be smart enough, and knowledgeable enough around these matters to do your best to preserve the capital base to live on the interest, dividends, etc.
So basically your last sentence is identical to my intent to do well in investing.  Encouragement to thrive, and survive.  The thrive part, typically requires a sound monetary base.

--------------------------------
No argument and soundly articulated.
Adam Smith is very likely smiling.

[Absalom]

I am grateful for parents and grandparents, that taught me and showed me  the value of working, earning, saving, investing in stocks/bonds and real estate.

-------------------------------------------
Your words about parents and grandparents, showing and teaching, reminded me of this.
Socrates was the guide/tutor of Plato, who in turn, did the same for Aristotle.
But we moderns who are the greatest (why of course) have no need of such experiences
cuz we have credentials and degrees and recommendations! 
Hmm.........................................................