Make It Stop!!!!!

[Aerides]

I'm perplexed why so many people are running around screaming about the recent drop in equity values. According to my favorite equity snapshot page, the DJIA is down ~4.3%, the S&P 500 is up ~2.5%, and the Russell 1000 is about even over the past year as of this afternoon. This hardly seems like a 'crash'. Perhaps the popping of an equity bubble would be a more appropriate characterization? [/I]).

Just my 2¢.

On Feb 21 the DOW was over 29k. Today it's under 25k, so a bit more than 4% from the high. Similarly, the S&P was over 3300 and is now under 2800. So, it's not a crash, and no need to scream, but still hardly perplexing to understand that it's cause for concern for a lot of people, no?

No matter the numbers, of course, it's only a loss if you sell and make it one, but I know that's hard for some to do when we don't know if we're anywhere close to the bottom.

 

[atmsmshr]

I'm perplexed why so many people are running around screaming about the recent drop in equity values. According to my favorite equity snapshot page, the DJIA is down ~4.3%, the S&P 500 is up ~2.5%, and the Russell 1000 is about even over the past year as of this afternoon. This hardly seems like a 'crash'. Perhaps the popping of an equity bubble would be a more appropriate characterization?

I don't have much exposure to equities, but it's frightening to imagine if the stock markets have only recently completed an unwinding of the bubble and haven't even begun seeking a level appropriate for the scenario where the major world economies are plagued by covid-19 (both the sickness itself and fear of the sickness).

Just my 2¢.

Amen!

 

[Fermion]

So what is the level that is appropriate for the virus scenario?

If the virus kills off 2% of the world population, does that mean just 2% lower consumption and the market should only drop a couple % from the highs?

 

[ER Eddie]

Glad I retired a month ago so I can stay in bed today with the covers over my head ...

Yes, I know—if your AA is right, you can relax, blah blah.

Doesn’t mean this doesn’t SUCK ��

Yeah, I'm not feeling great about it, either. I retired about 8 months ago. It's sort of like stepping on to the rollercoaster just before it takes the big plunge. Waaaa!

One way I try to think about it, to make myself feel better, is reframing this as a sort of boot camp for retirement. You get hit hard in the beginning, but all the stress eventually makes you stronger and more able to handle the stresses ahead. You come out a more confident and able soldier.

Another analogy might be a sailor who encounters a strong storm just after setting out, but discovers that he can survive it just fine. He comes out of it a more confident and capable sailor, more relaxed about sailing into the future.

Of course, in order to get that gut-level ease and confidence, we first have to get through boot camp or weather the storm. That's the hard part. It may take years. But the experience will serve us well in the future.

Sound good? You buy that? lol. That's how I like to think about it anyhow. It sucks to get thrown in the deep end right off the bat, but we'll come out of it with more confidence and peace of mind in the end.

 

[statsman]

On Feb 21 the DOW was over 29k. Today it's under 25k, so a bit more than 4% from the high.

I think the original post indicated being down 4.3% (now 5%) from a year ago, not from the DOW's all-time high.

 

[njhowie]

On Feb 21 the DOW was over 29k. Today it's under 25k, so a bit more than 4% from the high.

You may want to redo your calculation.

 

[Dtail]

You may want to redo your calculation.

Probably meant 4k not 4%.
Anyway, we are back to about even with our LTD portfolio, but hanging in there.
Didn't retire at the front end of the bull market like many on this site.
I still believe it will all work out in the end.

 

[Running_Man]

Relax - that info on the Japan market is very misleading. The actual Total Return over that time is POSITIVE. Yes, positive.

First, look at this chart - someone who retired DEC1989 wold have typically been investing for 20 years or so. Their average buy-in price would be far below that peak. If they never invested in the market, they would not have a peak to fall from. And they likely would be even further behind.

Second, you can't ignore dividends (oddly, some of the dividend stock proponents seem to often ignore stock price!). When you include dividends, the index has been up ~ 0.66% annually.

Relax.

edit - forgot to add screen grabs...


-ERD50

That return is not for a retired person withdrawing money but for an investor not touching funds and reinvesting dividends. Run Nikkie from 1989 and withdraw 3% per year - adjusted for inflation in Japan and see where you end up. If there is any money left I'd be shocked.

 

[audreyh1]

On Feb 21 the DOW was over 29k. Today it's under 25k, so a bit more than 4% from the high.

You may want to redo your calculation.

Yep!

Today’s close 23,851. Close on 2/12 29,551. That’s a drop of 19%.

Math is hard!

 

[Marita40]

I just don't look. Head in the sand time.

Best. Strategy. Ever.

I sleep very well, thank you, and my blood pressure is just fine.


All will be well, and every manner of thing will be well. ~ Julian of Norwich

 

[Clone]

Recently heard in our household- "The market's only down 7%, we can still afford to run to Walmart and get Toilet Paper!'

So I got that going for me, which is nice.

Probably bad form to quote yourself, but what the heck!

Attached is a picture from Walmart. Quite frankly, I was shocked! We were able to get a 6 pack of our normal premium TP. But it was cleaned out a few moments later, and folks were swarming the isle. A few minutes later the only thing left was the marginal store brand stuff, and not much of that. DW was pointing out carts around the store that were loaded with paper towels and TP. It is getting nuts out there! (Not sure why the orientation is flipped, it looks OK before I upload it.)

 

[maestro]

I had expected this months ago, and what bothers me now is the inevitable 'Fed stepping in' to 'BAIL out' select sectors. I like to travel cheaply, but don't like Fed bailouts, and still believe in FREE markets.

 

[Dtail]

Probably bad form to quote yourself, but what the heck!

Attached is a picture from Walmart. Quite frankly, I was shocked! We were able to get a 6 pack of our normal premium TP. But it was cleaned out a few moments later, and folks were swarming the isle. A few minutes later the only thing left was the marginal store brand stuff, and not much of that. DW was pointing out carts around the store that were loaded with paper towels and TP. It is getting nuts out there! (Not sure why the orientation is flipped, it looks OK before I upload it.)

Where are you at?
There is no paper towels or TP shortage by us...not yet.

 

[njhowie]

Probably bad form to quote yourself, but what the heck!

Attached is a picture from Walmart. Quite frankly, I was shocked! We were able to get a 6 pack of our normal premium TP. But it was cleaned out a few moments later, and folks were swarming the isle. A few minutes later the only thing left was the marginal store brand stuff, and not much of that. DW was pointing out carts around the store that were loaded with paper towels and TP. It is getting nuts out there! (Not sure why the orientation is flipped, it looks OK before I upload it.)

When I began seeing stories about this, I laughed wildly and same for DW. Simply amazing that there would be a run on the stores for TP!

We always have about 100 rolls of TP on hand. Also well-stocked with non-perishables to easily survive a month or two without visiting the grocery store.

In the absolute worst case, you run out, and we are looking at Armageddon, there's always this - old t-shirts and rags work fine:
https://redandhoney.com/how-to-get-started-with-family-cloth-and-why-you-might-actually-love-it/

 

[Amethyst]

I did not know this previously:

"While the impact of flu varies, it places a substantial burden on the health of people in the United States each year. CDC estimates that influenza has resulted in between 9 million – 45 million illnesses, between 140,000 – 810,000 hospitalizations and between 12,000 – 61,000 deaths annually since 2010."

Why isn't everybody quarantined every flu season, and why doesn't this tank the stock market every year?

 

[aja8888]

Why are people hoarding TP when we have Amazon and grocery home delivery?

 

[Amethyst]

Delivery people get sick, too, I guess.

Why are people hoarding TP when we have Amazon and grocery home delivery?

 

[ER Eddie]

I did not know this previously:

"While the impact of flu varies, it places a substantial burden on the health of people in the United States each year. CDC estimates that influenza has resulted in between 9 million – 45 million illnesses, between 140,000 – 810,000 hospitalizations and between 12,000 – 61,000 deaths annually since 2010."

Why isn't everybody quarantined every flu season, and why doesn't this tank the stock market every year?

Yeah, that's a lot. If you take a mid-range figure, that's about 37,000 deaths in the US per year. I kind of want to say, "Wake me when the coronavirus death total hits 37K," but that sounds a little callous.

Those numbers do put things in perspective, though.

 

[aja8888]

Delivery people get sick, too, I guess.

They will call in sick and someone else will fill in. We are a long way from "no more delivery drivers"! LOL

 

[njhowie]

Why are people hoarding TP when we have Amazon and grocery home delivery?

In the high-demand situation, as was seen with some items this past week on Amazon, when there is a shortage, they may get marked up many times what they would normally cost.

Notwithstanding, we have the space, and I pick up a couple of 20-packs when they're on sale simply out of habit.

 

[ER Eddie]

Why are people hoarding TP when we have Amazon and grocery home delivery?

I'm wondering why people are hoarding TP at all.

Does coronavirus cause diarrhea or something?

 

[Live And Learn]

Where are you at?
There is no paper towels or TP shortage by us...not yet.

I am in Pinellas County and the stores around here have shortages of TP, water, and there is not a bottle of hand sanitizer to be found. The stores look like they do when there is a hurricane threat. Hand sanitizer and rubbing alcohol I understand. But water ?

It's as if everyone is expecting a global 2 week forced isolation.

 

[brewer12345]

I did not know this previously:

"While the impact of flu varies, it places a substantial burden on the health of people in the United States each year. CDC estimates that influenza has resulted in between 9 million – 45 million illnesses, between 140,000 – 810,000 hospitalizations and between 12,000 – 61,000 deaths annually since 2010."

Why isn't everybody quarantined every flu season, and why doesn't this tank the stock market every year?

The US is apparently alone in throwing in a whole host of non-flu maladies (pneumonia, etc.) in the flu death statistics, so the number of deaths is significantly overstated.

Why is everyone freaking out about corona? No vaccine, no treatment, more contagious and more lethal than the flu. Very little understanding of it. Lots of unknowns. But hey, if you want to lick a bunch of doorknobs in an airport and hop on a cruise ship, have at it.

 

[audreyh1]

I'm wondering why people are hoarding TP at all.

Does coronavirus cause diarrhea or something?

Only in rare cases. It's one of those weird things people feel compelled to do.

If you are stocking up in general for a long home stay, you do want to make sure you have an adequate supply, but beyond that.....

 

[ER Eddie]

The US is apparently alone in throwing in a whole host of non-flu maladies (pneumonia, etc.) in the flu death statistics, so the number of deaths is significantly overstated.

Ah. Yeah, lumping pneumonia in with the flu would inflate the numbers.

p.s. Although now I see that pneumonia is the way a fatal case of the flu often ends, so perhaps that is why they are grouped together -- because they often do go together in practice, at least as far as mortality is concerned.

I also read that flu isn't a reportable illness, so the CDC doesn't know exactly how many cases there are. They're estimating based on mathematical model, which in turn is based on some statistical sampling of an area where they are tracking it.