Stock markets disconnect?

ChopperST

EdGasketTheSecond said:

It's just a mug's rally before the next lurch down. If you look at charts of the big crashes you will see similar rallies while overall the market goes lower for a long time.

If you are that sure then I'm sure you are shorting the FTSE and S&P right now then?  Let us know how you get on....

bostonerimus

There will certainly be another "lurch down", but I'm not going to predict when it will be because I'm not a carnival fortune teller.  Things will probably eventually recover, but I have no idea of the path. What I do know is that the stimulus packages, failing businesses, pent up demand, government, business and personal debt and the direction of the wind will all be factors. If you have an asset allocation that is aligned with your strategic planning then don't waste your time worrying.

Thrugelmir

bostonerimus said:

There will certainly be another "lurch down", but I'm not going to predict when it will be because I'm not a carnival fortune teller.  Things will probably eventually recover, but I have no idea of the path. What I do know is that the stimulus packages, failing businesses, pent up demand, government, business and personal debt and the direction of the wind will all be factors. If you have an asset allocation that is aligned with your strategic planning then don't waste your time worrying.

What's the mood like on your side of the pond?  Are the different States all tackling the crisis well ? 

bostonerimus

Thrugelmir said:

bostonerimus said:

There will certainly be another "lurch down", but I'm not going to predict when it will be because I'm not a carnival fortune teller.  Things will probably eventually recover, but I have no idea of the path. What I do know is that the stimulus packages, failing businesses, pent up demand, government, business and personal debt and the direction of the wind will all be factors. If you have an asset allocation that is aligned with your strategic planning then don't waste your time worrying.

What's the mood like on your side of the pond?  Are the different States all tackling the crisis well ? 

Thanks for asking. The situation varies greatly. NY is terrible (think Italy) and they are fighting very hard while Florida only just issued a stay at home notice - it is bad there, but will probably get worse. In MA everyone is staying home, and the health system is stressed, but holding up and the death rate is low, similar to Germany and Korea, The police aren't being as fascist as some UK police and its fine to go out walking or go to the beach or the parks as long as you stay well apart and wear masks. I'm cycling a lot. The Southern states were late to implement social distancing and are still allowing people to go to church and with their weaker health systems I fear that they will see a lot of death.

MA's Governor, Charlie Baker, is doing a good job and with the medical infrastructure here testing and tracking of the virus is pretty good and there's a $1Billion plan to develop it further. I don't watch the White House/Trump press conferences as there's very little useful in them.  MA will be locked down until May 4th and then Baker and the MA Dept of Public Health and the epidemiologists from Harvard, Mass General etc will decide if we have to stay at home longer. I don't think they will take much notice of what the Federal authorities say if they try for an early return to normal.

I'm staying in touch with friends and family in the UK and the worst consequence so far is lost wages. One niece works at Sainsbury so she's still working, but she's worried about bringing the virus home to her kids and husband.

EdGasketTheSecond

ChopperST said:

EdGasketTheSecond said:

It's just a mug's rally before the next lurch down. If you look at charts of the big crashes you will see similar rallies while overall the market goes lower for a long time.

If you are that sure then I'm sure you are shorting the FTSE and S&P right now then?  Let us know how you get on....

Short on FTSE yes as already posted on another thread. I can't see much point also shorting S&P as well?? (Don't fight the FED springs to mind). Thank you for your concern.

EdGasketTheSecond

dunstonh said:

EdGasketTheSecond said:

It's just a mug's rally before the next lurch down. If you look at charts of the big crashes you will see similar rallies while overall the market goes lower for a long time.

Not correct.  Each period of similar losses is different.  Sometimes recoveries are quick. Sometimes recoveries are slow.  Sometimes there is a short sharp drop, sometimes long and drawn out.  Sometimes there are single dips, double dips or treble dips or more. 
There is no way to tell what is coming.   We know you don't like investing in equities and promote gold and silver but it doesn't mean you can give false information to people here who may take what you say at face value.

"An increase in prices during a primary trend bear market is called a bear market rally. A bear market rally is sometimes defined as an increase of 10% to 20%. Bear market rallies typically begin suddenly and are often short-lived. Notable bear market rallies occurred in the Dow Jones index after the 1929 stock market crash leading down to the market bottom in 1932, and throughout the late 1960s and early 1970s. The Japanese Nikkei 225 has been typified by a number of bear market rallies since the late 1980s while experiencing an overall long-term downward trend. "

From:

https://en.wikipedia.org/wiki/Rally_(stock_market)

theGrinch

No one knows the earnings figure in the equation
No one knows what kind of economic rebound there will be.
No one knows if the virus returns in the winter months requiring more shut downs while we are still without a vaccine, when a vaccine will be produced and when a critical number of the population will receive it.
Too many material unknowns to have any faith in this rally.

port_of_spain

theGrinch said:

Too many material unknowns to have any faith in this rally.

Why would one "have faith" in any rally? Or in any short-term price moves, up or down?

A more cogent reason to be invested in equities would be that they have higher expected returns over the next 10+ years than any other general asset class, and that one is in a position to wait at least that long.

There's no need to attempt calling short-term market moves; which is fortunate, because nobody can do that consistently.

Halabala9

theGrinch said:

No one knows the earnings figure in the equation
No one knows what kind of economic rebound there will be.
No one knows if the virus returns in the winter months requiring more shut downs while we are still without a vaccine, when a vaccine will be produced and when a critical number of the population will receive it.
Too many material unknowns to have any faith in this rally.

But there is one thing that we all know - FED said that they will be printing unlimited money.

theGrinch

Mike997 said:

theGrinch said:

No one knows the earnings figure in the equation
No one knows what kind of economic rebound there will be.
No one knows if the virus returns in the winter months requiring more shut downs while we are still without a vaccine, when a vaccine will be produced and when a critical number of the population will receive it.
Too many material unknowns to have any faith in this rally.

But there is one thing that we all know - FED said that they will be printing unlimited money.

Indeed thats the one thing pushing the floor up. Keep that machine printing for Trump's re-election.