Is the stock market going to tank?

[huckbucket]

rich people are feeling good?

Attachment 327090

Feels institutional ... although the venn overlaps with rich obviously.

[jono]

What?

Outbreaks that can effect the safety of air travel happen pretty frequently and very large ones in about 1% of years. Black swans happen. Investors continue to demonstrate humanity's general incompetence at managing low probability/high cost risks.

[Stu Gotz]

I’m all in on hertz, jay crew, gap and Norwegian cruise lines. Should I be nervous?


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Said in jest, but I wonder how many companies will file bankruptcy over the next 6-12 months to restructure debt, leases, etc. So many of these companies are debt, fueled dead man walking that I would imagine they'll use the virus as cover to clean up the books.

[Toadman]

Who in the hell is propping up this market and what is their relationship to Donnie?

His name is Vlad Putin, and they are business partners in an off-shore tax shelter LLP.

[4matic]

Where’s the beef?

[ncskier]

Said in jest, but I wonder how many companies will file bankruptcy over the next 6-12 months to restructure debt, leases, etc. So many of these companies are debt, fueled dead man walking that I would imagine they'll use the virus as cover to clean up the books.

I couldn’t believe j crew had 1.6 billion in debt. That’s a lot of sweaters and khakis to sell every month. Crazy


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[dunfree]

I couldn’t believe j crew had 1.6 billion in debt. That’s a lot of sweaters and khakis to sell every month. Crazy


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TPG had to milk it for all it was worth. Take out debt to pay dividends.

[Benny Profane]

Because he’s not stuck buying stocks, he’s waiting for something like the BofA preferred deal he did to get handed to him.

Well, yeah, he did make a nice chunk of change lending to Goldman in 08.

[Benny Profane]

Outbreaks that can effect the safety of air travel happen pretty frequently and very large ones in about 1% of years. Black swans happen. Investors continue to demonstrate humanity's general incompetence at managing low probability/high cost risks.

Really. You were prepared for this? How the fuck could you be. If you invested with an event like this in mind, you'd be poor. Hiding in cash. Nice 20 20 vision there, son. There's a lot of that going around.

[Benny Profane]

I couldn’t believe j crew had 1.6 billion in debt. That’s a lot of sweaters and khakis to sell every month. Crazy


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No, that's the private equity game raping the American economy to build 50,000 sq ft. Party houses in the Hamptons .

[ncskier]

No, that's the private equity game raping the American economy to build 50,000 sq ft. Party houses in the Hamptons .

I fully understand that. The day they were straddled with that debt, was the day they were dead. They just did't know it yet.

[IVplay]

Who in the hell is propping up this market and what is their relationship to Donnie?

Fed dosing the credit markets, no reasons to hold t-bills unless institutionally mandated. It's cash vs. equities. Although I don't believe the market has accurately gauged the slow CAPEX recovery due to deteriorating balance sheets. 408BB debt raised by U.S. companies in March, China's PMI dropped in April showing even the robust recoveries aren't all they seem. The economic story is far from penned.

[El Chupacabra]

Really. You were prepared for this? How the fuck could you be.

[Ted Striker]

Ha! So true and infuriating.

[huckbucket]

Fed dosing the credit markets, no reasons to hold t-bills unless institutionally mandated. It's cash vs. equities. Although I don't believe the market has accurately gauged the slow CAPEX recovery due to deteriorating balance sheets. 408BB debt raised by U.S. companies in March, China's PMI dropped in April showing even the robust recoveries aren't all they seem. The economic story is far from penned.

How about in Engrish for the financially illiterate ...

[Timberridge]

How about in Engrish for the financially illiterate ...

Pretend consumers are drug addicts.

Along comes the Fed driving a Cadillac with a 1000W sound system cranking "Hip Hop Hooray" and cruising the neighborhood, selling meth. Things are good at first and people are buying. One day the Fed notices nobody is buying meth at the old prices because the hardcore addicts died and the ones with jobs lost them.

"We gotta lower the prices and we'll get more customers" says the Fed chairman. "Shit yeah," agree all the regional governors.

[Toadman]

From what I've seen in the polls, the uber douche, Doug Collins is kicking her A to the double S by over 30 points or something like that in the Repub primary in GA.

[IVplay]

How about in Engrish for the financially illiterate ...

Fed announced a month or so back that they would step in and buy high yield bonds. This dampens the credit markets for players like Buffett et al. as they don't have the leverage to extort high coupon payments.

https://www.etfstrategy.com/federal-...ld-etfs-94578/

Due to low interest rates on U.S. govt's, as well as worldwide govt. bonds, there is no reason to hold that asset class unless you are a pension fund which will hold bonds, especially if net inflows are projected (more people contributing then withdrawing). Shrinking returns for both ends of the bond market will push money managers and other institutional players toward stocks. Money managers face the risk of impatient investors if they hold 10%+ cash and miss out on a rally, so they have to put their money to work somewhere. Buffett's history of success precludes him from this dilemma.

The fed's solution addresses liquidity - a short-term cash flow issue that prevents maintaining debt obligations. The problem is no one knows how far away the other side is and to what degree it will resemble the economy as we knew it. My concern is the other side is further away and less rosy than the market suggests. Increasing debt loads relative to revenues (assuming revenues decline 2019 to 2021 as debt loads rise) will hamper business investment and rehiring, and ultimately shrink the number of companies that will have access to the credit market to address their liquidity problems. 2021 will be interesting as a lot of high yield debt matures in the face of (likely) moribund cash flow.

https://www.spglobal.com/marketintel...-is-high-yield

Hard to pay your creditors if you can't sell baconators.

https://www.cnn.com/2020/05/05/busin...age/index.html

[Kevo]

Or bonds keep moving up, UST holders get paid (again), gold outperforms (again), SPX disappoint (again) and fed jawboning of HY market comes to be seen for what it is: sentiment manipulation, not real purchases of HY issues.

That's what I'm betting on. I'm set to at least do OK baring everything but a significant rise in interest rates.

[jono]

Really. You were prepared for this? How the fuck could you be. If you invested with an event like this in mind, you'd be poor. Hiding in cash. Nice 20 20 vision there, son. There's a lot of that going around.

Bears make money too, Benny. Surprised you haven't figured out how to take that approach, actually, it seems like a better fit for you.

[Benny Profane]

Bears make money too, Benny. Surprised you haven't figured out how to take that approach, actually, it seems like a better fit for you.

Ok, you just slipped into a strange form of dick swinging asshole who doesn't know what the fuck you're saying. Bye bye.

[huckbucket]

Fed announced a month or so back that they would step in and buy high yield bonds. This dampens the credit markets for players like Buffett et al. as they don't have the leverage to extort high coupon payments.

https://www.etfstrategy.com/federal-...ld-etfs-94578/

Due to low interest rates on U.S. govt's, as well as worldwide govt. bonds, there is no reason to hold that asset class unless you are a pension fund which will hold bonds, especially if net inflows are projected (more people contributing then withdrawing). Shrinking returns for both ends of the bond market will push money managers and other institutional players toward stocks. Money managers face the risk of impatient investors if they hold 10%+ cash and miss out on a rally, so they have to put their money to work somewhere. Buffett's history of success precludes him from this dilemma.

The fed's solution addresses liquidity - a short-term cash flow issue that prevents maintaining debt obligations. The problem is no one knows how far away the other side is and to what degree it will resemble the economy as we knew it. My concern is the other side is further away and less rosy than the market suggests. Increasing debt loads relative to revenues (assuming revenues decline 2019 to 2021 as debt loads rise) will hamper business investment and rehiring, and ultimately shrink the number of companies that will have access to the credit market to address their liquidity problems. 2021 will be interesting as a lot of high yield debt matures in the face of (likely) moribund cash flow.

https://www.spglobal.com/marketintel...-is-high-yield

Hard to pay your creditors if you can't sell baconators.

https://www.cnn.com/2020/05/05/busin...age/index.html

You clearly don't speak jive like Timber. But I did got the baconator reference. Kudos.

[jono]

Ok, you just slipped into a strange form of dick swinging asshole who doesn't know what the fuck you're saying. Bye bye.

Don't be stupid. I'm not dick swinging. In this very thread are many strategies and each one is going to respond differently. You said no one could see this coming to the airlines. But like most risks it was foreseen by some and ignored by others. As if they expected to live out their whole lives without ever encountering a once-per-century event. Risk management failure is why we're in this mess. If more people got that maybe we wouldn't be. But by all means, keep up the name-calling. Down with intelligence. Long live death. (That's sarcasm, by the way. You're welcome, boomer.)

[Benny Profane]

Don't be stupid. I'm not dick swinging. In this very thread are many strategies and each one is going to respond differently. You said no one could see this coming to the airlines. But like most risks it was foreseen by some and ignored by others. As if they expected to live out their whole lives without ever encountering a once-per-century event. Risk management failure is why we're in this mess. If more people got that maybe we wouldn't be. But by all means, keep up the name-calling. Down with intelligence. Long live death. (That's sarcasm, by the way. You're welcome, boomer.)

Ok, since you persist, how would you manage a risk like this, an event that more than one Nobel winner in economics has said that there is no, zero, model for in history?

[shroom]

you may or not plan for this risk, but you plan based on the probability that something will happen that will suck.

cash flow management is not a new thing. much of america tryna live without plan b both corporate and non.