Given the media and overall panic about this virus situation, it looks likely to me that this reduced connectivity is being achieved. This also gives more credibility to the China data, I mean, they did quarantine entire cities, they have drones monitoring people, they have sound boxes outside people's houses telling them to stay inside, why would it be a surprise to see that they are succeeding in containing the problem?
Global Macro Trading Journal
- Thread starter Daal
- Start date
Given the media and overall panic about this virus situation, it looks likely to me that this reduced connectivity is being achieved. This also gives more credibility to the China data, I mean, they did quarantine entire cities, they have drones monitoring people, they have sound boxes outside people's houses telling them to stay inside, why would it be a surprise to see that they are succeeding in containing the problem?
"As a result, the Chinese have dropped the Re (the Effective Reproductive Rate) of COVID19 from ~3.8 new cases per extant case to ~0.32. When this number is below 1.0, the epidemic extinguishes (at least it will, for a while, within China)."
I added to BRK.B, EWZ at open today. Sold the last of my long-term bonds. All my bonds are SHY or 2y Ts now
Bill Ackman UP on the year despite market crash
https://pershingsquareholdings.com/...e-and-year-to-date-return-as-of-9-march-2020/
https://www.pershingsquareholdings.com/company-reports/weekly-navs/
I took a lot of shit here when I pounded on the table that PSH was a good buy and now I'm being proven right. Not only he had a monster year last year now he effectively hedged before the market drop. And he is a stock picker! Heck, he did a better job than me at hedging. I had my gold, bonds, and a small short on SPY. Which was not enough to cushion me against the drop. So I'm down on the year but the man is up. That is a terrific performance! He is the best investor of his generation. VRX was the result of many years of good performance leading to hubris but the man is good
https://pershingsquareholdings.com/...e-and-year-to-date-return-as-of-9-march-2020/
https://www.pershingsquareholdings.com/company-reports/weekly-navs/
I took a lot of shit here when I pounded on the table that PSH was a good buy and now I'm being proven right. Not only he had a monster year last year now he effectively hedged before the market drop. And he is a stock picker! Heck, he did a better job than me at hedging. I had my gold, bonds, and a small short on SPY. Which was not enough to cushion me against the drop. So I'm down on the year but the man is up. That is a terrific performance! He is the best investor of his generation. VRX was the result of many years of good performance leading to hubris but the man is good
More panic in the markets, my plan is to keep adding stocks like BRKB all the way down. Ideally I will be 80-90% in equities if/when SPX reaches -30%/-35%. I really think is the opportunity that I missed in 2009 because I was too inexperienced and couldn't keep my head straight while everyone panicked. But now I'm different, I learned that listening to all these 'experts' will just make you bearish when you shouldn't. Coronavirus is a 6month MAYBE 1 year story, meanwhile stocks are 10+ years assets. This is quite an opportunity to make a retirement sort of investment
I agree - markets here are in full on panic mode, forward PEs for the S&P 400 (midcaps) have crashed to the same levels seen in 2002/03, end 2018 and 2011/12, yet bond yields are far lower: 4.5% on the long bond vs. 1.2% now! History suggests that we won't sell off much further from here unless the crisis dramatically and unexpectedly intensifies, whereas pretty much any positive news (on caseloads, stimulus, econ news etc) could mark a significant low.
IMO a year from now investors will be staring at those microscopic yields-to-maturity on their bond holdings, and quite possibly MtM losses if yields revert a bit, while kicking themselves that they didn't lock in 5-7% earnings yields on stock indices.
Don't you think that there will be many companies defaulting without government intervention? Supply shock is real and actual thing.