This week will be really interesting to see what kind of official forward guidance is given from all of the big financial players following their Q1 earnings reports.

GS, BAC, JPM, WEL, MS are all reporting earnings this Tuesday & Wednesday.

Edit: lots of other big names reporting this week - DAL, JJ, FITB, C, BX, BLK. It'll be interesting for sure.

And, the VIX remains high, above 40 - definitely not the levels you would expect from a market that has bottomed.

 

AMZN should report big earnings this week and buoy the market at least. Kind of a miraculous recovery already in terms of where the market sits currently.

 

another interesting development.

Fairly certain that the economy (and stock market) hasn't bottom when oil does this.
Oil producers are paying refiners and other buyers to take the oil from them.

 

"No amount of sophistication is going to allay the fact that all of your knowledge is about the past and all your decisions are about the future." -Ian Wilson

 

Well. So far it's looking like March was the bottom. And, yeah, Buffett is sitting on $130 billion in cash and missed out.

I'm happy with being wrong here. It's the best case scenario right now.

That said, I still feel like the second crash is just around the corner... 40 million people are unemployed. Covid-19 is showing no signs of slowing down, and all of the protesting and rioting is going to accelerate the spread. We'll see the real fallout in earnings reports come July and August when Q2 results are in. None of it makes any sort of fundamental sense - maybe everyone just wants to see something optimistic and bright with 2020 being so shitty.

The 2008-2009 crash took about 6-7 months to unfold before bottoming.

Did this market really bottom out in just 1.5 months time?

 

Fed action was the difference this time. March 23rd was the bottom because on that day, Powell indicated that the Fed's arsenal was unlimited.

 

Those last 4 words scare the living daylights out of me! Though is also the reason that the US will never DEFAULT on their debt. They will just "print more money" and pay off the debt.

Secondly: I wouldn't judge Buffet's actions or well............inaction so quickly.

Market Cap over GDP is now higher than the DOT COM BUBBLE and we are not roaring back to life and it's June. We "bottomed" in March with the outlook of being past this by now, or did it bottom because the Fed will be propping up the house of cards market at any cost?

 

Inflation and higher taxes are the likely cost of Fed action. And Chase 10 year CDs are now paying 0.20 per cent. A fixed income portfolio (bonds, CDs, MM) will lose close to a third in value over a 20 year holding period. Conservative investors have never had it so bad.

 

Agreed. He has a track record of 20% returns year over year for a long term investing period of greater than 50 years. He was written off many times in the past as well... That said, he missed out because the Fed jumped in as quickly as they did, and he didn't get to secure any backdoor deals like he did during the 2008-2009 recession.

I also do not think we are past the fundamentals of what should be ailing the market. We have a tariff/trade war with China still looming. Covid-19 hasn't disappeared (and is likely to get worse following the protests/riots). The impact of the protest/riots isn't priced in (the market has only risen this whole week). We have 40 million Americans unemployed, and more on the way tomorrow. A lot of those jobs aren't coming back - ever.

I doubt this will be a "V" or "U" recovery.

I'm expecting a "W" and really hoping it doesn't turn into an "L"...

 

I wonder if this is priced into the market too? I'm not seeing how the trillions of dollars of stimulus are making it downwards where it matters. We're just propping up the stock market, but then we have this...

Millions of Americans skipping credit-card and auto-loan payments
https://www.wsj.com/articles/million...ts-11589985381

Millions of Americans skipping mortgage payments
https://www.marketwatch.com/story/ov...nts-2020-05-18
https://www.npr.org/2020/06/03/86785...and-evictions-

That doesn't look like it's going to have a happy ending. Will the market continue to go higher still??? How is that going to get fixed and at what point do we see it affecting the stock market - does it matter?
They didn't teach this kind of math in school...

I guess we just wait and see. We're only about 2-3 months into this so far.