Member Info for Nash2020

Fleccy

I agree we will have some sort of a deal on BREXIT as the EU is in much worse condition than us. Everything should get better by Sep 2020 as much as it can under the current circumstances.

I just hope that the COVID second spell does'nt return in Oct 2020. Considering that the flu jab is partially effective due to the new strains/mutations, the new Covid vaccine's effectiveness is questionable.

USD below key support level - all the commodities are on fire.

Stock markets are also going up.

US is planning a 20Trillion 20 yr bond issue to create hyperinflation in the economy which would assist paying off debt.

Hyperinflated economy combined with higher commodity prices would support the USD. Hence, they think there is no need for negative interest rates in the US.

UK economy is tied up with how the housing market copes.

Dart

Yup US is planning a 20Trillion 20 yr bond issue.

This would lead to many central banks adopting negative interest rates. We should see GBP:USD at 1:1 in the short term.

Bond rally sends UK short-term yields below zero

https://www.ft.com/content/ff7ec3ac-61e6-11ea-b3f3-fe4680ea68b5

Seismic

I totally agree with money going to actual consumers.

However, QE in any form is very bad as it distorts the pricing massively. More importantly the QE just kicks the bucket a further afar.

Looking at Japan since 1980's the QE has not resolved the problem but is has just kept it hidden under wraps.

Theo

Totally agree with you on this.

In my opinion it would be better to increase the social benefits such as Income support, unemployment support payments by 100% or more rather than bailing out / furlonging / dishing out business loans.

Govt tax revenues are going to take a massive hit as stated previously.

Another interesting point is that until March 2020 there were lot of businesses stating the business is down in millions. In May 2020 the same businesses under the govt schemes are now claiming to have made losses in millions.

Which one of the above two scenarios is correct?

In my opinion the delay to lock down has cost us 30K + lives. It was a cache22 situation whether to protect people or economy.

COVID 19 is the invisible enemy we are all fighting a war against.

Everything in this world has a velocity and the speed of infection for COVID 19 is phenomenal.

Another interesting point is that until March 2020 there were lot of businesses stating the business is down in millions. In May 2020 the same businesses under the govt schemes are now claiming to have made losses in millions.

Which one of the above two scenarios is correct?

Don't you think the jobs, increased food banks, etc are inter-linked with the economic factors?

I do agree massive infrastructure investment will assist but in areas where there is a necessity. The input cost needs to be kept low to benefit the economy.

In my opinion any infrastructure investment within M25 will not have a low input cost.

The 1929 stock market crash happened due to massive buybacks by the promoters. This is the reason why the central banks do not want it to be reinstated.

The promoters will utilize cash to buyback their own shares to prop up the prices. Once prices go higher they dilute to almost zero and than file bankruptcy.

By reinstating buy backs the promoters will become short sellers and take everyone to the cleaners.

I disagree that there are similarities of current market with 1929-33.

Yesterday Powel stated the FED QE has been mostly through creating digital currencies and some form of printing to ensure liquidity to banks. Therefore, all central banks can create or delete digital currencies with a press of a button.

In 1929 we did not have
- digital currencies created in no time with a press of a button
- Furlong schemes
- Bailouts
- Business loans
- Interest rate manipulation
- Derivatives such as ETF, CD, etc
- Index re-balancing
- Supply chain issues
- Demand supply mis-match created by above factors leading to price distortions
- market width (exposure to market)

The most important factor today is that everybody is exposed to stock market. Our Mortgage,Pension, commodity, etc are all dependent on increasing stock market. We cannot accept markets going down because this will lead to a vicious cycle of defaults which was not the case in 1929.

Another thing in 1929 was the US stock market was the only market which majority of non-americans did not have access to.

Apologies in advance if people feel otherwise but I would love to know your thoughts.

If I am correct S&P500 re-balancing is this week. Any idea when the FTSE100 re-balancing is?

This re-balancing will ensure that the markets (indices) will keep going up. However, the individual stocks especially with correlation with the pandemic are getting sold massively.

https://www.marketwatch.com/story/why-the-next-big-shoe-to-drop-in-the-us-economy-could-hit-by-july-2020-05-13?mod=newsviewer_click

This is when I think the market will bottom out by making a new low.

Dart

https://medium.com/swlh/the-great-bull-trap-of-2020-69fc833ebfa1

The article is very true and frightening. People are not taking the current situation seriously. The Govt didn't take the virus seriously and were propagating 'Herd immunity'.

If you try to discuss the reality people blame you to be pessimistic. The problem is everyone has a different set of skills and abilities to devise solutions. However, not everyone has the ability to identify the crux of the problem.

'With everyone currently social distancing, this toxic mix of record household debt and non-existent personal savings could soon implode if workers aren’t able to get back to work in the very near future. Without a reliable source of income, many households will have to resort to selling over-leveraged assets, including stocks, bonds, mutual funds, and real estate — regardless of market conditions. If things get really ugly, households will have to start deleveraging completely by walking away from underwater mortgages and leased vehicles. '

Everything an individual does in life has risk, reward and consequences as part and parcel of their lives.

In these uncertain times we need basic ingredients of diversification, pound cost averaging and hedging. Majority of people fail to hedge because they never think of the worst.

The markets tanked today as soon as a sanctions bill on China was introduced in the US senate.

https://www.reuters.com/article/us-health-coronavirus-usa-graham/trump-senate-ally-seeks-china-sanctions-over-covid-19-probe-idUSKBN22O2XM

Additionally US fed reserve chairman is expected to differ massively on introduction of negative interest rates.

https://www.cnbc.com/2020/05/12/powell-is-expected-to-squash-idea-of-negative-interest-rates-even-as-trump-says-they-would-help.html

It seems the US administration is going to ramp up the China issue to distract focus on domestic COVID19 issues.

In my opinion the markets are going to have massive fluctuations.

The markets tanked today as soon as a sanctions bill on China was introduced in the US senate.

https://www.reuters.com/article/us-health-coronavirus-usa-graham/trump-senate-ally-seeks-china-sanctions-over-covid-19-probe-idUSKBN22O2XM

Additionally US fed reserve chairman is expected to differ massively on introduction of negative interest rates.

https://www.cnbc.com/2020/05/12/powell-is-expected-to-squash-idea-of-negative-interest-rates-even-as-trump-says-they-would-help.html

It seems the US administration is going to ramp up the China issue to distract focus on domestic COVID19 issues.

In my opinion the markets are going to have massive fluctuations.

No wonder why Scotland received a massive consignment of PPE in Glasgow whilst the UK govt was trying to get it through Turkey.

https://www.bbc.co.uk/news/uk-scotland-52338099

Apologies in advance but the link doesn't work.

What is this about?

In my opinion the retail sector is finished for good. The likes of Amazon/Ebay will take over the market space of majority of the retailers. The retailers will not be able to compete after taking into consideration the fixed costs such as rents, business rates and higher manufacturing costs. The higher manufacturing costs will come from the weakening currencies accompanied by the lack of consumer spending would lead to lower volumes and lesser profits.

I think we have too much of the below mentioned sectors which will show massive readjustment:
- Retail outlets including shopping malls
- Bank branches including too much competition
- Hospitality, travel and Leisure will become expensive and out of reach for the majority of the population

I think rather than replacement of US dollar as the universal currency the above economic readjustments will support bitcoin(digital currency) massively.

We are definitely going into a deflation but getting into hyperinflation is a very distant possibility.

Reached 1.12 and is about to break down below the lower bollinger band.

If S&P 500 goes to 3000 which I think is very much possible the puts will go down massively which will pull VILX down.

Any ideas how low will it go?