Scary virus outbreak in China

Kex

Kex

Some interesting news from the The Center for Systems Science and Engineering (CSSE) at John Hopkins University

• For the first time ever, the number of recovered in China has exceeded 50% of known cases: 42K vs. 80K
• Italy has now exceeded 1,000 cases.
• France, Germany and Singapore have now exceeded 100 cases each (only 2 deaths in France, including an 80+ Chinese tourist, not 12 deaths, as was erroneously stated elsewhere).

Kex

Parallels have been drawn with influenza. Yes, there are more deaths every year from influenza than have been recorded from COVID-19. But just like traffic accident deaths and gunshot deaths, those do not impact the financial markets, because they are predictable. They occur every year, in greater or lesser amounts, but the market expects them to happen.

COVID-19 is having such a significant effect on the markets because it is unpredictable. Bud has already hinted that he got out of the market because of fear of losses, not because he feared catching the virus himself.

Not everyone can just get out of the market, though. I haven’t sold a single position because getting out of the market would mean planning for Capital Gains tax: 200K for every million in Capital Gains.

Furthermore, getting back in the market is not that simple either: for every million in Capital gains, there would then be 200K less to put back in the market when the time comes. This would have a significant effect on investment leverage.

It would be easy to lose any advantage from selling in the first place under those circumstances. Timing the market when the upswing happens - and is maintained - can be a tricky thing.

So, the politics of reporting on the outbreak has little bearing on this perspective. If market forces judge that there could be economic consequences from the spread of the virus, then the market will fall. It’s that simple, and this has been demonstrated unequivocally during the last week of trading.

deronb1

If anything, this should be an eye opener on how globally connected economies are and how important China is to it.

BlueFox

Kex wrote: »

Bud has already hinted that he got out of the market because of fear of losses, not because he feared catching the virus himself.

I didn’t hint. I did, except for some I would have had to pay tax on if I sold it. Being 70, my investments are conservative, so hopefully they will weather this storm. Of course this assumes I don’t catch it and checkout from this planet.

nooshinjohn

BlueFox wrote: »

Kex wrote: »

Bud has already hinted that he got out of the market because of fear of losses, not because he feared catching the virus himself.

I didn’t hint. I did, except for some I would have had to pay tax on if I sold it. Being 70, my investments are conservative, so hopefully they will weather this storm. Of course this assumes I don’t catch it and checkout from this planet.

BlueFox wrote: »

So deaths caused by flu will rise from 60K to 3M. That is 3 million people meaning if you have 200 friends in your Facebook profile around 10 of them will be dead until the end of the year. It may be your son, father, coworker, best friend etc.

No worries Bud, if you do pass from COVID-19, you will be back by the end of the year

Milito

Latest cruise pics from internet.

daddyjt

A few points from my research:

1. Despite what the media profess, we really don’t have enough data to make any accurate predictions at this point. Intellectual honesty necessitates disregarding all data from China as unreliable. The data from other countries is not sufficient to make accurate predictions yet, as the sample sets are too low - at least to entertain discussions of a “global pandemic”.

2. Much is being made of the first death on US soil. While tragic, this individual had “contributing medical conditions”, that most certainly increased their susceptibility to this particular virus. This is important, as it significantly curtails the impact projections of the virus on the general population - or at least it should.

3. This virus (as well as all viruses, as far as I know), has no political affiliation. Further, as the virus clearly started in China, I fail to see how any US political figure could have had a hand in either it’s creation or it’s spread. The sheer irresponsibility of the media to lay this virus at the feet of political figures is perplexing. This also seems to be a new trend, as I do not recall the rabid politicization of Swine-flu or Bird-flu.

4. The media. They are either unwilling or unable to display even a modicum of responsibility. It is indeed nauseating to listen to the barely concealed glee you hear behind the non-stop blather about the impending “global pandemic”. If they were even the least bit responsible, they would wait for, and report, the facts - and stop the endless parade of speculation, projection and prophecy, all based on incomplete and/or false data.

5. Unless you are trying to protect others from you, stop buying and hoarding face masks for god’s sake. Wearing a mask actually INCREASES your chance of contracting a viral agent because it brings your hands to your face with greater frequency.

F1nut

Ah, a refreshing voice of reason.....bravo!!!

Polkitup2

I did buy a small bottle of hand sanitizer today. I feel I am now ready to face the Corona virus head on. Does that make be a prepper?

krazypolk

This might be an issue for the Chinese but here in the US the agenda driven media are solely responsible for all the hoopla. More Americans will be killed by years end by meteorites than by this fake news virus.

Kex

JPMorgan, Citi and Goldman Sachs suggest that there hasn't been enough pain to call a bottom yet. Things may bounce tomorrow, and they may not, but in the Great Recession, the bottom did not happen until early March 2009.

Latest news from JHU CSSE Corona Virus Tracker:

• China exceeds 80K cases (almost 45K recovered).
• South Korea exceeds 4K cases.
• Italy heading for 2K cases within days. The number of recovered nears 100.
• U.S.A. almost certain to exceed 100 cases within days.

Anyone basing their investing decisions on information found on alt-right conspiracy propaganda websites like zerohedge dot com deserves everything that comes their way. They will reap what they sow.

daddyjt

Kex wrote: »

...Anyone basing their investing decisions on information found on alt-right conspiracy propaganda websites like zerohedge dot com deserves everything that comes their way. They will reap what they sow.

Kex

^^^^
It’s been quoted more than once in this thread, but it is not a credible source of information, by any stretch of the imagination. They make stuff up, to put it mildly.

daddyjt

Kex wrote: »

...it is not a credible source of information, by any stretch of the imagination. They make stuff up, to put it mildly.

Sounds like they would fit in nicely with the rest of our main-stream media...

ptrooper

First death here in Western Australia. Well he doesn’t look Australian but is ,he also came of that floating incubator from Japan

Willow

I really don't get all the attention this is getting. In the US you guys have more people dying everyday from car crashes, guns and other illnesses. Do you really think this virus is the main reason the fall in the markets, come on! They are riding the coat tails of the fear the media is injecting into your lives. Just use common sense, wash hands don't lick the escalator railing and don't spit in or let others spit in your mouth and eyes.

Gardenstater

So what's your theory on why the markets are falling if not fear of the impact upon global economic growth that could be caused by a possible panemic?.........fear of Bernie winning the democratic nomination, and then *possibly* the Presidency?

The volatility is no doubt due to the fact that something like 90% of the trading is algos. now, as crazy as that is.

treitz3

Market chain disruption. Media hype/fear mongering.

Tom

Willow

The virus didn't cause the markets to fall, the fear that people won't be able to get their newest iPhone, or whatever else is made in China did. People can wait, this will all settle soon enough. The moment there is a little blimp in the world, oh it's time to sell share holders are scared they won't get their extra million this year.

tonyb

treitz3 wrote: »

Market chain disruption. Media hype/fear mongering.

Tom

Bingo, market chain disruption is real and will but the brakes on the markets for awhile.
Keep in mind, who benefits politically if the market tanks, in an election year, and you'll see who's driving the fear mongering for political reasons. Not rocket science there.

treitz3

la2vegas wrote: »

No offense, but your logic is faulty.

Care to back that up with any intelligence?

Tom

Gardenstater

@willow this is by no means an event that is isolated to the US markets. Global markets have been taking a hit comeon lol

Willow

I never stated it was isolated. Global, yes because everything we buy is made in China.

pitdogg2

If you're in the market for a globe, which market is the best to buy it from??

tonyb

Gardenstater wrote: »

@willow this is by no means an event that is isolated to the US markets. Global markets have been taking a hit comeon lol

Absolutely, maybe take a step back and actually look at how much dependency from all over the globe is put in China. Cheap labor, cheap goods, etc. Their economy tanks, most everyone elses will too.

We make jokes about everything being made in China, right ? Shouldn't put all your eggs in one basket.

treitz3

While I have not "fact checked" this.....I heard on the news yesterday that back in the last economic recession of '08-'09, China only had 4% of the world market share. Today, they hold 16%. That's a big difference. FWIW

Tom

erniejade

Because of the scare, I feel it is also hitting some small business owners. I run Karaoke and DJ in a few small bars. For the past few weeks, the bars that are usually packed during the winter ( 100+) have only had 10-15 customers all night on a Friday. Summertime they usually slow down a bit and loose some to places that have an outdoor patio but, not as bad as I have seen in the past few weeks.

BlueFox

It amazes me how poor people know everything about the stock market.

krazypolk

So much for the gloom and doomers. Stocks are roaring back!