Coronavirus - Financial, Health and Other impacts II

[NW-Bound]

Quote:

Originally Posted by Chuckanut If it really is the end of the world, why not end it on a nice cruise to somewhere exotic?

Quote:

Originally Posted by Fermion But I mean really? You want your last few weeks experience to be being on a respirator in a tiny cabin on a ship?

They don't have respirators on ship.

The most they can do, when things look too bleak for you, is to carry you up to the deck for your last sunset.

[NW-Bound]

Quote:

Originally Posted by Chuckanut Please do not mention that again. I can already see our elected leaders plotting to raise the gasoline tax. They always do it when gas prices plunge to lows.

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Originally Posted by erkevin They already are (considering it) in Arizona; a doubling of the gas tax

Sorry as I am adding another off-topic post.

I believe that gasoline excise tax is mostly based on volume, meaning per gallon, and not based on gas price. Some states levy an additional sales tax, and that is based on price.

See: https://en.wikipedia.org/wiki/Fuel_t..._United_States

[6miths]

Don't plan on selling anything. Do have some cash that I am going to get back in at some point and looking like I will be able to get more than I would have a week ago.

Ya dance with who brung ya and Mr. Market has been very, very good to me!

[Tiger8693]

I stated a day or two ago that I was waiting to move in to some more equities. Going in with 50% of my planned buys today, will review again for the other 50% of plan on Monday.

Hopefully I'll be riding the rebound soon!

[Kwirk]

DW and I eat in restaurants almost daily. We'll be cutting back on that as long as we are trying to avoid the virus. When we do eat in restaurants we'll be focusing on hot foods and looking for restaurants taking extra precautions. We'll be looking for masks and gloves. The masks may or may not reduce viral shedding but they will help keep staff from touching their faces. I expect we'll be wearing gloves that we remove when leaving.

Air conditioning seems to provide a near perfect environment for survival of the virus, possibly a week or more on surfaces. Freezing probably does not kill it.

Eventually, we'll likely give up the extra measures and just take our chances (if we aren't infected sooner).

I expect that restaurants (and much of the service industry) are in for a very tough period.

[VanWinkle]

Quote:

Originally Posted by jabbahop I know there have been lots of conversation about safe withdrawal rates and sequence of returns in the past. One common theme is that people would normally cut back discretionary spending in bad market/sequence. I am wondering at what point you would consider cutting back on spending vs just staying the course. We have been planning on buying a new car even though the existing one still works fine. I am now thinking about just postponing the purchase until it becomes a necessity. Anyone else thinking about cutting back/postponing some “blow that dough” activities?

I have a 1969 Ford Mustang in my sights to blow some dough. I put the money needed to buy it in a short term bond fund. It has actually gained in this market so I can afford some gas for that 351/300 hp Windsor. Hope to complete the purchase in April, so who knows where the market will be.

[NW-Bound]

Other than the unpleasant sight of a Quicken screen full of red numbers, no changes yet in our way of life. Nothing to change in our spending. I did not make plan for any large expenditures, but if I did, most likely would not alter it.

If our future spending is the same as that of the trailing 12 months, the WR for that is 1.27% of the current portfolio. That WR is likely to increase, due to the shrinkage of the stash.

[audreyh1]

Quote:

Originally Posted by jabbahop I know there have been lots of conversation about safe withdrawal rates and sequence of returns in the past. One common theme is that people would normally cut back discretionary spending in bad market/sequence. I am wondering at what point you would consider cutting back on spending vs just staying the course. We have been planning on buying a new car even though the existing one still works fine. I am now thinking about just postponing the purchase until it becomes a necessity. Anyone else thinking about cutting back/postponing some “blow that dough” activities?

No, I have a fairly hefty amount in short term funds including this year’s spending money and I won’t cut back until short term funds run low.

We need to buy a new car. I’m just worried about supply.

[Bir48die]

Quote:

Originally Posted by Bir48die Yes it’s been a week. I’d be interested in those who do 100% self investing if they’ve held tight or radically changed AA this week or gone cash.

Was just curious and have enjoyed the responses. FYI in October 2018 I was a bit skittish and I hadn’t changed my allocation from nearly 90% equities. I went to 60/40 across the board. Missed some profits in 2019 but those are all gone anyway. So, like many of you I just “ride the pine” and watch the world happen.

[jollystomper]

Not changing my AA, other than making some Roth IRA contributions today for the 2019 tax year. My YTD returns through the end of February will be interesting , but with my current AA about 35% in stocks it is nothing of concern.

No spending changes, we still have plenty of cash, 5-7 years worth. At the beginning of the ear I was contemplating paying off our mortgage (balance is only $50K at 2.875%). Now it is tempting to invest that amount during these down times.

[W2R]

Quote:

Originally Posted by jabbahop Anyone else thinking about cutting back/postponing some “blow that dough” activities?

No way! Not yet. I am still buying whatever I want, whenever I want it.

I have enough in my local bank to do that for a very long time without any withdrawals from my portfolio at all. It helps that I am getting my "age 70" SS amount deposited in the bank like clockwork every month.

That said, I no longer regard this as a minor downturn. I could be wrong; often, I am. But still, I think this may be the beginning of that big follow-on recession we have all been waiting for since 2009.

[Fermion]

If this is a repeat of 2008, will we be seeing concerns about pensions again?

I can't think pension fund managers had any better crystal ball than the rest of us and were/are caught with their pants down.

Just another one of those snowball effects.

[Helen]

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Originally Posted by W2R No way! Not yet. I am still buying whatever I want, whenever I want it.

Considering the impact your chair purchase had on the stock market I hope you will give us a heads up before your next purchase.

[karen1972]

Quote:

Originally Posted by Skoach +1, I will be doing this today after my calculations to make sure I stay below ACA tax cliffs. May have more room later in the year if tax loss harvesting comes into play...

After the recent Roth conversion threads I had decided to forgo the ACA subsidy this year and do more conversions. Today I pulled the trigger on that plan and figure if the market has another significant drop I'll consider going all the way to the top of what i-orp recommended.

[harllee]

So far my reaction to the market drop has been very different than it was to the first few days of the 2008 drop. I was primarily in equites in 2008--I was worried about the market drop and could not sleep at night. After the 2008 recession was over I redid my investment philosophy to more align with my risk aversion. I am now 40% equities, 30% bonds and 30% money market/CDs. I have been sleeping great this time. Yes I am worried about the virus and shortages but I am not concerned at all about my investments--I have not even looked at them. I know I missed out on some gains over the years by having so much cash but that is what I needed to have for my own piece of mind.

For those of you are losing sleep over the market drop--I say your investments are too risky for you. Once all this settles down you should reevaluate your investment plan and make adjustments accordingly.

[Brat]

I am not sure that anything the Fed does will significantly impact the market but I think the following would be helpful (not in order of likely impact):

Suspend RMDs so that seniors will keep more of their IRA money invested;

Commence a program to make more ventilators;

Insure our hospitals from bankruptcy for the cost of care of CV patients;

Aggressively fund medical research for treatment and vaccines;

Fund the CDC at a higher level;

Ask the CDC to evaluate closed hospitals for potential beds for the convalescent.

That list is by no means complete but I think the money spent will have more impact than anything the Fed could do.

[W2R]

Quote:

Originally Posted by Helen Considering the impact your chair purchase had on the stock market I hope you will give us a heads up before your next purchase.

OK, will do!

Right now I can't think of anything that I need or want but if/when I do, I'll let you know.

[Kwirk]

Quote:

Originally Posted by MichaelB Fed action when credit is at issue has an immediate impact. Right now the economies around the world are starting to slow. This really requires fiscal responses, not monetary.

I guess we need to run even larger deficits and print/create even more money. I'm not sure even that would work well in the current situation if everybody stays home and there aren't many expensive things left to buy due to supply line problems.

[NW-Bound]

Quote:

Originally Posted by Fermion I am jaw dropping shocked that the DOW dropped another 1000 points and CCL is actually up. If this is really end of the world virus, who in their right mind will be booking a cruise? CCL is bankrupt and doesn't know it yet (if this is end of the world as the markets would have you think)

The MSC ship that was denied docking at Jamaica and George Town ports was allowed into Cozumel. That helped the entire cruise industry, I believe.

I wonder if people still take cruises if they do not dock anywhere. The whole trip is a bit worse than a repositioning trip, but if the price is low enough some people will bite.

[MichaelB]

[mod hat on]
There have been multiple references to elections, candidates and ideologies. This will ruin what is otherwise a very useful thread. Please keep politics out of this discussion. [mod hat off]