The prevailing sentiment amongst all of my advisor friends on Wall Street now is there is zero chance for anything materially bad to happen now that the Fed has, essentially, decided to finance everything. They will finance munis, junk bonds, small business loans, federal deficits, maybe buy stocks, finance static CLOs, etc. The list goes on and on.
Here is a typical dialogue I’ve had in recent days.
“But what if Q3 isn’t as good as we think and forbearance rates keep rising?”
“That’s ok, because mortgage services will get funding from Fed.”
“So the end user doesn’t matter?”
“Correct.”
“But if stores aren’t opened and GDP is down 50%, does that matter? Who will fill the hole?”
“The Fed will just print more.”
“So, no matter how large the deficit, the Fed will simply print more money to bail everyone out, indefinitely?”
“Yes.”
And that’s that. There is no debating with someone who gives up rational thought. Gone are the days when markets were priced according to earnings and business. According to most of my friends, we don’t even need business anymore. Why, people can just sit at home and collect dole and see their stocks RIGGED higher — because the Fed will simply backstop it out.
This type of smugness and arrogance is what will lead to a massive and collective societal collapse. We went from extreme fear to extreme greed in a period of two weeks, while businesses have only worsened. I’ve made most of my money on the upside, playing the rip — but I am still very much a bear for the remainder of the year and will look to fade this arrogance in the coming week.
There’s a special hell designed for people like this and I hope to see them burning inside of those fires soon.
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Amen
That sounds very familiar
How many of you guys watched avatar this as a kid?
Wait until reported unemployment hits +20% in a couple of weeks. U6 will really be 30%.
How far will a $3400 stimulus check (married couple,2 kids) go for a family living in an urban area like NY, SF, Seattle? Not a rhetorical question, just interested in general.
My wife is very disappointed, we are getting none of the loot.
That loot is not going to get anyone very far. Even a family earning $150k a year takes home $6-$7k a month. How the fuck is $3,400 going to help?
Oh, I forgot . The money only applies to those earning $75k or less. It’s a absolute joke.
There are people who don’t work that are collecting those earning just above $75k get zilch.
It’s all optics and sound bytes.
Restated in proper English:
There are people who don’t work that are collecting the $1,200 while those earning just above $75k get zilch.
Give it to the people who need it. I don’t want any. If we don’t do more for ordinary people- soon- there is going to be trouble. This is going to devastate us from the median down at least. I’m serious. People are going to start shooting. Maybe they should.
Doesn’t it phase out slowly from 75k to 100k?
Facts don’t matter much I guess.
I feel her pain. I had to cut a check to the IRS for over $12K and I don’t get shit from the free money pay out. Oh well.
Gold, beans, bullets, and rural/remote land.
How much land one needs in the end?
Land can work out well. My great grandfather was a relatively wealthy man who owned 700 acres and half a dozen country stores. He lost all the stores in the great depression. They lived off tobacco harvests and processing sugar cane into syrup/sugar (probably a lot of rum too) afterwards. That land is still held among his descendants.
More power to you Doc, Keep winning (if you keep your emotions in check). Like you have aptly noted the distance between Finance and the rest & elites and plebs will keep rising. Who cares what happens in the end…A major portion of the Fed’s creation, after meandering through commerce will end up in the form of profits (for some) in the markets.
Seeing news about quarantine measures scaled back next week in Denmark, Austria. Get ready for the second wave.
More like an extension of the first wave.
The real second wave will likely be the not-so-surprisingly October surprise for Elections 2020.
*not-so-surprisingly-surprising October surprise, the adverb and the adjective and the noun are useful in this instance
What do you think are odds of real war between then?
???
War between Demark and Austria?
The Main streets (a more diplomatic term for “average Americans”) are already broke as fuck:
https://www.cnn.com/2020/04/09/business/americans-rent-payment-trnd/index.html
And starving:
https://thegrio.com/2020/04/10/miles-cars-florida-food-bank/
https://www.expressnews.com/news/local/article/S-A-Food-Bank-giveaway-draws-a-queue-of-cars-15178372.php
Wall Street will have to come to terms with reality at some point.
I think that the middle class is going to go ballistic. They’re were at the breaking point. Now this.
I guess I’m probably considered middle class, thankfully the upper part; but yes, I’m fucking fed up with this bullshit. We can print over $4 trillion and still can’t fund universal health care? Get the fuck out of here with that bullshit.
Who’s going to pay for it? Next politician that says those words needs to be lined up against a wall and shot through the eyes.
Yep. There is a major disregard for real life. My father recently started a small business that has two employees. They were set to hire 5 more people this year. The SBA loan program they were close to finishing getting approval for is now frozen in favor of SBA programs lending to businesses that have fired people due to the crisis. They told my father it may be a couple years before the old program is available again. I contacted a couple friends who have slightly larger companies who have recently laid off employees. They said they contacted SBA lenders and were told they couldn’t get loans because there wasn’t enough guidance from the feds.
Another friend who is in small business was told he qualified for a relief grant. After doing all the paperwork he qualified for 10k.
Fed may be back stopping things in a lot of ways, but it is not getting through to small businesses right now and in REAL LIFE the government could take months or a year just to fix the mechanics of interfacing with small businesses.
A lot of small business are gonna disappear and probably won’t be rebuilt.
Walt Disney World 43,000 Employees Getting Laid Off
https://www.tmz.com/2020/04/11/walt-disney-world-furlough-employees-coronavirus-theme-park-closed/
Just a flesh wound. It isn’t like there are thousands of other businesses that depend on DIS for revenue in Orlando.
Just curious, what do you think would have been the best policy response to the pandemic?
We are talking about 1% mortality rate for the population. Mostly 65 & older and imuno compromised (up to 20% of that cohort). I take care of my dad who is 81. He had a stroke a couple of weeks ago. I followed the ambulance and was there to talk to the doctor about his prognosis. Practically no one in the emergency room was wearing a mask or any ppe. I couldn’t get back in the hospital to see my dad after I left. He was discharged a few days later with a TIA stroke.
In my opinion, this is totally overblown.
I understand that they are trying to flatten the curve. The optics are bad when twice as many people die in a given year among the elderly(nursing homes are hard hit). I’m shopping once a week, wearing a mask and gloves, putting groceries in the sunlight and feeling like a jackass.
But what do I know . I do it for my dad.
I want the antibody test. My nephew flew to Chicago on December 23. We drove to Illinois to pick him up on the 28th and spend time with family. He was sick with a cough and fever. I’m thinking this is just great. I get to drive six hours back home with this sick kid. Dad gets sick a week later to the point he can’t even get out of bed. We go to the doctor and he gets some antibiotics. We all have the dry cough for a couple of weeks.
Yep, hope your family is doing well. Where are the tests? This has been a serious question for at least a few weeks. Fly was on this thing months ago.
We are all well. Well fed and stocked up. 320 million people is a tall obstacle to test. We need something where you spit, piss, poop, or bleed on it at home like a pregnancy test.
Even then, this is complete horseshit. Wash your hands often and keep your distance from imuno-compromised people. This disease kills the weakest among us just like any other disease.
They were promising the 15 minute electronic tests via Abbott Labs equipment last week. Priority will be given to hospital staff as they are the main vector for infection. The last place you want to go to is a hospital unless you think you are going to die, which is why so many people are saying emergency rooms are empty. Unrealistic projections are being made about widespread testing because they don’t want to panic people. There isn’t going to be widespread testing. There isn’t going to be a vaccine, not a real one anyway. Think about it. Aids is a virus, Malaria is a virus, Herpes is a virus, the common cold is a virus. No vaccine exists for those among many others. Flu vaccines are mostly inefective from year to year. The hdroxychloroquin/Zpac therapy is the best they have to offer for covid at the moment.
Henry Schein Medical has this test available, Phone hotline for info 1 844 211 0140. From their website…”Antibody (Serology/Blood)*
Performed in a point-of-care setting
Identifies antibodies in blood drawn from a finger stick
Can be administered as early as 5 days after symptoms develop
Results are available in 10–15 minutes
This type of serology testing, when combined with other patient information, can help providers determine if a patient can proceed with normal, daily life
Serology/antibody tests detect antibodies to the SARS-CoV-2 virus
The tests do not identify the presence of the virus itself and should not be used as the sole basis to diagnose or exclude SARS-CoV-2 infection.
Positive results may be due to past or present infection with non-SARS-CoV-2 coronavirus strains, such as coronavirus HKU1, NL63, OC43, or 229E”
These law firms that sue public companies should go public At least a dozen show up in news feeds more than the actual companies with news.
Today we need health professionals, tomorrow as pandemic fever ebbs we may need more flowers. Lawsuits galore.
need more lawers
FLWS from $2 to $16 over 8 years. I see no problem with that. Only $6 more back ATH
You know how this ends…..>50/60% capital gains tax in coming years. It’s going to happen eventually. The Fed gifted you stock market grandeur, now you’ll pay them back.
They key is to realize capital gains when you’re done working. You can pull out quite a bit of money tax free with your standard deduction that way.
Holy shirt! Where is Showtime to ring on, on this?!
How many of you had chickenpox as a kid? Up until ten years ago there wasn’t a vaccine for the aftermath of a chickenpox infection called shingles. If you got chickenpox (almost everyone infected survived) 70% of the infected got shingles in their senior years. It blinded my grandfather in the late 80s shortly before his death. Who knows what Covid will do?
Debbie Downer
https://www.youtube.com/watch?v=TfE93xON8jk
That’s a good one. My younger brother got chicken pox after getting the shot and I somehow never got it. Days and days of dunking over him on the nerf basket and nine footer relentlessly at the same time
Yeah I know people who got the chicken pox vaccine and later had shingles but never had the actual chicken pox.
A couple things on my mind.
The fed will do more but will they try to promote an artificial economy?
The billionaires. What do they want? How far into the unknown before they suggest (demand) we stop?
I don’t think that the powers will take a chance on their privileges by imprudent action. They’re fine here.