stock market crash

[ChimpMaster]

Rumour mill doing the works suggesting US stock markets will close after Monday's trading day comes to an end until control of the outbreak is brought under control. Very very interesting times ahead.

If only there was a market you could trade that never closed down.

Very improbable.

The market will hit it's bottom tomorrow or very soon. It's 33% off its peak, which ties in with previous sharp corrections.

Of course, I could be wrong, and I often am, but logic eventually prevails once the fear, rumours and panic subside.

[SeededLoaf]

The market will hit it's bottom tomorrow or very soon. It's 33% off its peak, which ties in with previous sharp corrections.

That would be great personally but I don't think that's the case. Because this will drag on for months we''ll surely see businesses fail left right and centre. The US isn't even fully locked down yet neither.

The exit door for investors is getting smaller by the day and soon only budgerigars will fit through.

I am still buying small bits to average down my losses.

[scooterscot]

Ask yourself, do you have confidence in in the economy right now?

Until the answer is yes... the market keeps going down. Dat simple.

[GhostofTarbera]

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I am still buying small bits to average down my losses.

I’ve got magic beans for sale £100 each, you seem my target market based on your current investment strategy


Sent from my iPhone using Contractor UK Forum

[ChimpMaster]

Ask yourself, do you have confidence in in the economy right now?

Until the answer is yes... the market keeps going down. Dat simple.

Incorrect. The stock market always looks 9 to 12 months ahead of the actual economy. This is why stock markets boom in the good times, because forward P/E guidance is, as the name suggests, forward looking.

In very rare occurrences, a black swan event such as 9/11 or Covid will knock the socks off the market and we see what we see happening now - a panic situation and a scramble to get into cash. This often overshoots, and I admit it could still be in the overshoot phase right now and this might go on for a bit.

What is happening in the world right now, all this negativity, is already priced into the markets at this point. Unless we are about to enter a historic depression, I personally don't see much downside from here. The recovery could in fact be very sharp by historical standards, due to the tools used by governments and central banks the world over. The actions taken - cutting rates, increasing money supply, insuring jobs etc - were not taken in previous market collapses (after Spanish Flu or after the Great Depression).

None of us is prescient on this and I don't have a position, but just speaking from previous experiences.

[ChimpMaster]

I will also add that a market bear will always hope for something horrible happening in the world to bring down markets or to bring down world order or to collapse economies or to crash house prices etc. It's easy to read into this ethos when it's just words on paper and it's easy to wish for this to come true when you're only looking out for yourself or for your financial position.

But ultimately there is always a human cost to this and it pains me and it pains many others to think what is becoming of our world now. We are in the midst of a biological disaster, one that is killing thousands and one without prevention or cure. The suffering is huge, in a medical sense and with the impact on peoples' lives and livelihoods.

I for one want to hold hope that markets will recover and recover quickly, because, regardless of the actual financial implications, it would imply that the economy will recover and peoples' lives will get back to some degree of normality and - hopefully - we will be in a much safer position from Covid.

[scooterscot]

I hear you… I’m not always this bearish. In my opinion a quick recovery is impossible, whatever I may hope.


From my perspective the virus is a scapegoat to facilitate a market correction that already began more than a year ago. A debt bubble that has grown over years so much so there’s now no shrinking it.


We speak of a return to normality in a few months, but exactly what is that? Interest rates at 0% whilst I pay 18% on my credit card? Housing that cost 9x my income? An ever growing divergence between rich & poor? Russia putting US shale companies out of business by crashing oil prices just because Putin doesn’t like Trump? We’re entering a period of time where US influence doesn’t count for much anymore. Arguably the UK too, just not that important anymore.


Normality hasn’t been with us since the early 2000’s, that’s the cold truth. We’ve been gorging ourselves on debt ever since without giving a second thought as to how it’ll ever be repaid. The debt has made us weak AF. And that makes me angry.


I don’t think the markets have nearly priced in what the world will be like 12 months from now. Our behaviour has already changed as a result of everything that is happening today.


Hotels will go out of business as revenue falls (The Hilton is already talking about shutting down a number of properties), airlines will go bankrupt or fall under state ownership. We’ll almost certainly travel less as more and more folks realise I can Skype instead of flying.


Consider what is happening in the stock markets, the drop it has taken. At not point in the history of the stock market has such a sharp drop in such a short period of time ever occurred before. This is just the end of the beginning.

[SeededLoaf]

https://eu.usatoday.com/story/money/...ll/2895917001/

Another turbulent week ahead then.

[scooterscot]

Exactly what I'm thinking - there's no bounce back in the near future - markets cannot price in what they cannot see.

Let's wait and see if the bottom is in by this time next year.


Global economy will suffer for years to come, says OECD

The world will take years to recover from the coronavirus pandemic, the Organisation for Economic Co-operation and Development has warned.


Angel Gurría, OECD secretary general, said the economic shock was already bigger than the financial crisis.


He told the BBC it was "wishful thinking" to believe that countries would bounce back quickly.


The OECD has called on governments to rip up spending rules to ensure speedy testing and treatment of the virus.


Mr Gurría said a recent warning that a serious outbreak could halve global growth to 1.5% already looked too optimistic.


While the number of job losses and company failures remains uncertain, Mr Gurría said countries would be dealing with the economic fallout "for years to come".


He said many of the world's biggest economies would fall into recession in the coming months - defined as two consecutive quarters of economic decline.


"Even if you don't get a worldwide recession, you're going to get either no growth or negative growth in many of the economies of the world, including some of the larger ones, and therefore you're going to get not only low growth this year, but also it's going to take longer to pick up in the in the future," he added.


Big shock
Mr Gurría said the economic uncertainty created by the virus outbreak meant economies were already suffering a bigger shock than during the September 11 terror attacks or the 2008 financial crisis.


He said: "And the reason is that we don't know how much it's going to take to fix the unemployment because we don't know how many people are going to end up unemployed. We also don't know how much it's going to take to fix the hundreds of thousands of small and medium enterprises who are already suffering."


Governments around the world have taken unprecedented steps to support workers and businesses during the outbreak.


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Coronavirus recession not yet a depression
Policymakers in the UK have pledged to pay the wages of employees unable to work due to the coronavirus pandemic.


Mr Gurría called on governments to rip up borrowing rules and "throw everything we got at it" to deal with the crisis.


However, he warned that bigger deficits and larger debt piles would also weigh on heavily indebted countries for years to come.


No quick recovery
Mr Gurría said that just weeks ago, policymakers from the G20 club of rich nations believed the recovery would take a 'V' shape - with a short, sharp drop in economic activity followed swiftly by a rebound in growth.


"It was already then mostly wishful thinking," he said.


"I do not agree with the idea of a 'V' shaped phenomenon ... Right now we know it's not going to be a 'V'. It's going to be more in the best of cases like a 'U' with a long trench in the bottom before it gets to the recovery period. We can avoid it looking like an 'L', if we take the right decisions today."


The OECD is calling for a four-pronged plan to deal with the outbreak, including free virus testing, better equipment for doctors and nurses, cash transfers to workers including the self-employed and tax payment holidays for businesses.


Mr Gurría compared the level of ambition to the Marshall Plan - which helped to pay for the reconstruction of Europe after the Second World War.

[AtW]

Quick recovery will only happen IF effective large scale anti-virals helped beat virus