Coronavirus vs Investing

[killramos]

Today is too nuts, I wouldn’t even address the markets today.

Tomorrow or Wednesday would be a good time. CNQ sub 20 bucks, they just raised their Div too.

[ExtraSlow]

I'm going to figure out if I even have money to put into anything, and then, like the true coward I am, I will probably put it into the same "balanced growth" funds I usually buy. They aren't on as much of a sale as individual stocks, but they are what I want to own.

[killramos]

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I'm going to figure out if I even have money to put into anything, and then, like the true coward I am, I will probably put it into the same "balanced growth" funds I usually buy. They aren't on as much of a sale as individual stocks, but they are what I want to own.

You are a smarter man than I, I’m just greedy.

[ExtraSlow]

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You are a smarter man than I, I’m just greedy.

Smart moves look different for people in different situations. You can be much more aggressive than me.

[dimi]

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Pretty sure it can still go lower though. At some point if/when the US actually starts testing their numbers are going to balloon faster and cause more shockwaves. Hoping for another -10% still

What's the rush to buy in? When the "buy buy buy"/"buy the dip" turns to "my retirement is fucked" that's when you should probably start buying.

[Buster]

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What's the rush to buy in? When the "buy buy buy"/"buy the dip" turns to "my retirement is fucked" that's when you should probably start buying.

We are getting numerous signals that may (MAY!) in hindsight indicate we are bottoming out. Generally depression, desperation, blood in the streets, no hope, etc etc.

[pheoxs]

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We are getting numerous signals that may (MAY!) in hindsight indicate we are bottoming out. Generally depression, desperation, blood in the streets, no hope, etc etc.

Tomorrow will go up a couple %, as people try to buy in the dip but I'd wager by the end of the weak things slide even more.

[dimi]

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We are getting numerous signals that may (MAY!) in hindsight indicate we are bottoming out. Generally depression, desperation, blood in the streets, no hope, etc etc.

When you start seeing layoffs, insolvencies and a general slowing of the economic cycle, I would agree with you. I'm hoping that's not case, by the way.

I do want to throw a bit of cash in gold, as I see another rate cut, and a lot of fiscal stimulus announced by weeks end.

[89coupe]

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Tomorrow will go up a couple %, as people try to buy in the dip but I'd wager by the end of the weak things slide even more.

Keep buying

[nzwasp]

Holy shit cve stock is down to $4. Their CEO was hoping to get to $20 by the end of 2020, unlikely that was going to happen anyway.

[pheoxs]

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Holy shit cve stock is down to $4. Their CEO was hoping to get to $20 by the end of 2020, unlikely that was going to happen anyway.

Looked up CVE and had a good chuckle at the top news link

[Mitsu3000gt]

I'm sure some people have made lots of money from it, but IMO owning O&G stocks in Calgary is not the smartest play. My thinking has always been that if you own a house in Calgary, you are already indirectly but heavily invested in O&G, so there are probably better places you can be putting your money to diversify. Many of the big ETF funds hold some O&G anyway, so even if you try to avoid it you are still likely buying a bit more as it is.

[suntan]

Bought a bunch of Corona beer, am I doing it right?

[killramos]

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Bought a bunch of Corona beer, am I doing it right?

Depends, did you get a good deal.

Corona beer is a long position, it’s not going to be warm enough for a while to really enjoy it and get your ROI.

[ercchry]

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Depends, did you get a good deal.

Corona beer is a long position, it’s not going to be warm enough for a while to really enjoy it and get your ROI.

Most certainly not the beverage of choice for next weekend...

[dezmarez]

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When you start seeing layoffs, insolvencies and a general slowing of the economic cycle, I would agree with you. I'm hoping that's not case, by the way.

I do want to throw a bit of cash in gold, as I see another rate cut, and a lot of fiscal stimulus announced by weeks end.

I think this is what the markets are pricing in, typically they are forward looking, so the sell off you are seeing at this moment, is the perception that layoffs, insolvencies and general slowing of the economic cycle is coming.... what a day.

[nickyh]

Is there a way to know if a company will be de-listed soon?

Been following SES.TSX and since their release on the 24th; they have dropped 75%. It was up to 35% down as of Friday close and now even more dismal.

[born2workoncars]

Thoughts on GGI.V? I could absolutely be convinced to gamble $25k on my LOC on this one.

[Buster]

I don't always agree with Garth Turner on his blog, but he's been doing good work through the great toilet paper virus outbreak.

https://www.greaterfool.ca/2020/03/09/the-storm-2/

When the storm hit, she couldn’t take it. ‘Get me out,’ she said. ‘Sell it all, before it goes to zero.’

Her advisor did. He turned paper losses into real ones. She took the remaining cash and put it into a high-yield bank account paying nothing. Eventually, with no more investment income and only her public pension, she spent it all. Six years later she was bankrupt. At 82. Meanwhile everything she sold had doubled in value.

True story. My relative, in 2009. It was painful to watch how emotion replaces reason, and the inevitable outcome.

Today, same challenges. Things were bad enough with the virus insanity, then Putin decided to crush capitalism by diddling with the oil market and warring with the Saudis. Crude collapsed Sunday night, global stock markets sold off big, bond prices surged, yields collapsed, the VIX spiked and now confusion reigns.

Let’s dig in a little.

First, the bug. There have been (as I write this) 111,700 cases in the world. Of those, 63,000 people recovered. They’re fine. There are 45,000 folks who still have it, 40,000 of them with a mild dose. Just under 6,000 people (out of 7.7 billion) are serious. Some – mostly the old, with underlying conditions – will die.

Wash your hands. You’ll be fine.

Now, oil.

The virus dropped demand by about a million barrels a day as China shuttered for two months. So prices were weak. Then the OPECers started squabbling. The Ruskies played hardball. Oil plunged and could retest the lows of 2015, when it was $27 (now about $32). Nobody saw this coming. In its desire to crash US crude production, mother Russia is also whacking Alberta. Since oil makes up a third of our exports, it’s a big deal. The TSX showed that today.

Okay, stocks and bonds.

The virus uncertainty shaved more than 10% off markets which last year soared up to 30%. After all, it’s a risk. Despite the numbers above, it could go squirrely. Then the oil shock hit. The margin calls went out. The algos sold off. It was full-bore, risk-off with volatility spiking, market circuit breakers tripped and the dudes on BNN having cows.

Meanwhile central bankers have started throwing money around. Crushing interest rates was the first step – both the Fed and the BoC did that last week – and there are several more cuts to come. After that there will be direct CB buying up of assets, from bonds to the equity of major corporations. If that fails, everyone will get a pony.

Dropping rates, rising concern about recession and a torrent of money flowing from stocks into bonds have sent yields skidding lower. A five-year Canada bond paying 1.7% three months ago fell to just 0.3% on Monday before recovering a little. Mr. Market thinks US bonds will hit zero. The corollary is that bond prices have jumped – so people with balanced portfolios have seen some protection from the stock plop. As planned.

Next up? Governments. The coming T2 budget (next month) will increase federal spending, send more bucks to the provinces and may contain widespread fiscal stimulus in the form of a tax cut. It will also open the deficit floodgates. That $28 billion-a-year shortfall could double before long.

In Washington, next moves are uncertain. But it’s an election year. The orange guy has so far taken the market’s performance as a proxy for his presidency, and it’s unlikely the pump won’t be primed by a massive aid package, personal tax cuts and maybe even tariff cuts to get China back online faster. It will be breathtaking how quickly the anti-global agenda is trashed. Because it’s bunk.

Okay, so what to expect?

The mess ain’t over. The odds of a recession in Canada are much higher. The oil patch is in a lot of trouble. The good news is the cost of loans, mortgages, gas and heating fuels is going down soon, and by a lot. The bad news is imported goods will get more expensive as the dollar falls, government finances will implode and your job may be tenuous.

What to do?

Lather your hands a lot. Turn off BNN. Go play with your toilet paper mountain.

Beyond that, don’t sell into the storm. Going to cash may save you from another leg down, but it’ll also cause you to miss the leg up. There are people who ‘went safe’ in 2008 and never did find the courage to get back in – giving up an historic chance to build wealth. It’s human nature to exaggerate fear. Try to resist.

Buy cheap assets now on sale? Sure. History says that works. But it takes blind courage. For example, the world still runs on oil and prices won’t stay at these levels. The bold will reap.

Mostly, chill. Spend time with your dog. Ask her tonight about the Dow futures.

Exactly.

[suntan]

Pfft. How dare you steal my hope and dreams of a zombie apocalypse with reasoned words.