Talking Stocks 2.0

[uscmatt99]

Originally Posted by bearxj86

Trying to justify and give reason to each and every trading day is a fool's errand imho just like trying to time the market :). Just like your diet it should be measured over a period of time.

Another Buffett quote. "The stock market in the short run is a voting machine and in the long run it is a weighing machine". When you deal with "voting" it's more about momentum, emotions and public sentiment.

What is there to not feel optimistic about versus how we should have felt 2 weeks or a month ago? I daresay in the past 14 days we have been able to:

1) We know more than we ever know and learning more day by day.
2) Multiple companies have vaccines pending.
3) World leaders are all working towards the same goal - to stabilize our economies and prevent deaths.
4) Sound strategies such as "Hammer" and "Dance" are viable
5) Asian countries have shown it can be kept under control.
6) Fed and Congress are taking bazookas and atom bombs against the liquidity threat
7) Point of care COVID-19 test approved by FDA by Cepheid
8) Death rates seem acceptable so far relative to Italy
9) Stock market values are attractive and present an opportunity to look ahead and find REAL value
10) American companies are focusing on Ventilators.


No one is arguing these aren't painful or uncertain times, but crisis is always crisis. I think we're doing a lot about it. The fact this is a GLOBAL threat has resulted in the smartest people and all people all focused on a singular problem. I will not bet against 1) the resolve and resilency of the American people, 2) The combined wisdom and expertise of our world leaders and scientists, 3) all of mankind :)

Very well said, thanks for injecting some optimism, and so well worded.

[m j b]

Originally Posted by bearxj86

With the stimulus promising the average American “full unemployment benefits for 4 months” - why would you be afraid? Most companies should let their employees go for a while to help with liquidity. Either you pay it or the gov pays it. Is there a reason not to do unpaid leave to help with company liquidity?

Here in NC, the average unemployment check is $240 a week, with a maximum of $350. Can you live on that? Most people cannot pay their bills on that kind of income. I suspect most states are similar, in that they don't pay 100% of the lost wages.

And then you've got the "gig" workers, the self-employed, the business owners, etc. who do not qualify for unemployment.

"Is there a reason not to do unpaid leave to help with company liquidity?"

Are you serious? Studies consistently report that (according to the Federal Reserve Board) 40% of Americans cannot afford an unexpected $400 emergency expense. How then could they possible go with unpaid leave for more than a day?

Sorry, we (me) are digressing from the topic. But the stimulus, I fear, will not directly help the stock market, because once the numbers get crunched and what was hoped to be grants are really just loan guarantees, people will see that it's not going to help many companies.

IMHO.

[m j b]

Back to stock prices: I see that the airlines and Boeing are up in pre-market. Up big time, even after big rises yesterday. I still think that this is unjustified optimism.

I am tempted to short them. Now, I did that yesterday for about an hour and changed my mind (wisely, in hindsight) but I still see no reason for thinking that the stimulus is going to help airlines or Boeing. Because the only way that they recover, aside from huge grants - which I don't see in the limited information released about the stimulus - is for people to start flying. And that's not going to happen for a few more weeks, minimum. If people aren't flying, planes aren't flying (at least not with paying passengers). And if they aren't flying planes, they don't need to buy new ones.

What thinks the community here? Am I too pessimistic?

[beshannon]

Originally Posted by m j b

Back to stock prices: I see that the airlines and Boeing are up in pre-market. Up big time, even after big rises yesterday. I still think that this is unjustified optimism.

I am separating BA from the airlines.

BA is a strong company with problems, they are in Aerospace, Airplanes and Military products. They need to fix their problems with many products. They will survive and grow. Goldman upgraded the stock, the sell off was an over reaction to largely known news, IMHO

The Airlines are like the Cruise lines. People looking for a bounce due to the massive beatdown but the sad reality is that not all of the Airlines or Cruise lines will survive. Reports are now coming out that the Government will provide funding in exchange for equity stakes.

Yes this may mean less orders for BA over time.

Personally I bought BA below 100 last week and sold some yesterday. I will not go near the Airlines or Cruise lines either long or short as the risk is too great.

[GB-man]

https://www.cnbc.com/2020/03/25/bill...ng-hilton.html

I’m sure most here saw this but basically ackman tells everyone he closed his shorts for a 2.7 B profit on the 23rd and just like I said he was on CNBC last week telling a horror story trying to push the markets down even more before he closed.

[JParm]

Originally Posted by m j b

Back to stock prices: I see that the airlines and Boeing are up in pre-market. Up big time, even after big rises yesterday. I still think that this is unjustified optimism.

I am tempted to short them. Now, I did that yesterday for about an hour and changed my mind (wisely, in hindsight) but I still see no reason for thinking that the stimulus is going to help airlines or Boeing. Because the only way that they recover, aside from huge grants - which I don't see in the limited information released about the stimulus - is for people to start flying. And that's not going to happen for a few more weeks, minimum. If people aren't flying, planes aren't flying (at least not with paying passengers). And if they aren't flying planes, they don't need to buy new ones.

What thinks the community here? Am I too pessimistic?

I read that BA is shooting to return to production by May on the 737 MAX. I think they were a good value at around $100 (I bought then for the long haul), but I wouldn't necessarily recommend buying at today's $149. I think it will still come down in the near-term, and there's a bit too much optimism in that price yet.

[beshannon]

Originally Posted by jpeezy14@hotmail.com

I read that BA is shooting to return to production by May on the 737 MAX. I think they were a good value at around $100 (I bought then for the long haul), but I wouldn't necessarily recommend buying at today's $149. I think it will still come down in the near-term, and there's a bit too much optimism in that price yet.

Agreed, long term fine and I am holding what I did not sell

[beshannon]

Interesting comments out about NKE today, was on my shopping list but I missed this as I had to make some hard choices about where to deploy cash. On a pullback I would like to add

Nike sales beat analysts’ estimates, but earnings fall, hurt by coronavirus pandemic

https://www.cnbc.com/2020/03/24/nike...-earnings.html

[superdog]

Originally Posted by bearxj86

With the stimulus promising the average American “full unemployment benefits for 4 months” - why would you be afraid? Most companies should let their employees go for a while to help with liquidity. Either you pay it or the gov pays it. Is there a reason not to do unpaid leave to help with company liquidity?

super interesting theory. and I quite agree.

then again, there are potential grants for businesses to help cover payroll and whatnot.

hard to say what it right.

[enjoythemusic]

Originally Posted by Doc Savage

And the meek shall inherit the Earth...

Big Rush fan here!

[Mr. Miami]

Originally Posted by beshannon

Interesting comments out about NKE today, was on my shopping list but I missed this as I had to make some hard choices about where to deploy cash. On a pullback I would like to add



https://www.cnbc.com/2020/03/24/nike...-earnings.html

Interesting read. Thanks for sharing.

[beshannon]

Some nice follow through at the open, trading is orderly, BA adding to the outsized gain in the DOW but many stock in the green at the moment

Fading into 10:00 am, profit taking to be expected after yesterday and the open today.

I am looking for good underlying technical behavior and would not mind a pullback today as yesterday was mostly based on news and not fundamentals.

[FlashinLeather]

I know it will have ebbs and flows but cant help but feel I missed the bottom.

A few days ago people were saying that it will come down to 15,000. Anyone still thinking this?

When do the unemployment numbers come out?

[beshannon]

Originally Posted by FlashinLeather

I know it will have ebbs and flows but cant help but feel I missed the bottom.

A few days ago people were saying that it will come down to 15,000. Anyone still thinking this?

When do the unemployment numbers come out?

Trying to time the bottom is futile. What is the time horizon for the capital you have to invest?

Everyone knows that the unemployment numbers will be bad and they will get worse, again, what were the unemployment numbers in 2009? No one remembers.

An investor can only deal with the data and how it affects their plan. I feel that the markets will be higher a year from now and that is how I focus my efforts.

[JParm]

Originally Posted by FlashinLeather

I know it will have ebbs and flows but cant help but feel I missed the bottom.

A few days ago people were saying that it will come down to 15,000. Anyone still thinking this?

When do the unemployment numbers come out?

I think it was one bottom. I did some relatively heavy buying last week and this (about 40% of my allotted that I'm looking to spend).

I am holding the remaining 60% until we see that next bottom, which I think will come for a few reasons:

1.) we're still waiting on the inflection point of COVID-19 number of patients
2.) the unemployment rate is going to be surreal when we see it
3.) businesses aren't coming back at least until April, and it could very possibly be until May

We have renewed optimism today, but what happens next week when there is no stimulus talk? What if we haven't made headway anywhere?

It'll still come down, IMHO.

I'm also a long horizon investor, for what it's worth.

[Letsgodiving]

Originally Posted by FlashinLeather

I know it will have ebbs and flows but cant help but feel I missed the bottom.

A few days ago people were saying that it will come down to 15,000. Anyone still thinking this?

When do the unemployment numbers come out?

There are lots of false rally's in bear markets and if I were a betting man I would say the chances of this one continuing vs. having already bottoming out are definitely in favour of the former but no one knows for sure and I could be completely wrong.

I buy for the long term and I know I can't call a bottom so I just buy all the way down and then I'm guaranteed to get some close to the bottom but I have a fair amount set aside for exactly this and I plan to buy beyond a 50% drop if needed.

[superdog]

Originally Posted by FlashinLeather

I know it will have ebbs and flows but cant help but feel I missed the bottom.

A few days ago people were saying that it will come down to 15,000. Anyone still thinking this?

When do the unemployment numbers come out?

don't feel bad if you missed the bottom.

feel super grateful that the worst is over.

if that is true, and I certainly hope it is, just buy on the next down day. certainly we will have more down days to come.

I am hoping things normalize. I would be happy with even days for next 60 days just to create some normalcy.

[FlashinLeather]

Thanks for all the replies.

I'm not a day trader so all good advice. Going to buy on the next down swing and just mostly hold over the next 12 months.

[JParm]

https://www.marketwatch.com/story/no...S%3D1585145451

Quick read on the Chinese economy and how it could affect American companies. Long story short - China might not be back to the levels that everyone thinks.

[m j b]

I sold short AAL and bought puts on CCL this AM right before the tide turned and closed the positions within 10 minutes. I made money. I missed out on even more, but we don't worry about that.

There are three ways to play this market:

- jump in and out in a most nimble manner, day trading and quickly cutting any losses when you guess wrong. Because it's all guessing at this point.
- stick your head in the sand and wait for it all to be over
- gradually add to your positions and buy real companies with real products that people will want to buy, again, eventually. Buy on up days and especially on down days. Do not sell on down days.

#3 is obviously the smart way to play it.

I do #1 for amusement, never more than I can afford to lose. So far, I'm about even (having taken a big hit yesterday on a bad bet).

I'm trying to practice #3.

[Duey]

Originally Posted by FlashinLeather

I know it will have ebbs and flows but cant help but feel I missed the bottom.

A few days ago people were saying that it will come down to 15,000. Anyone still thinking this?

When do the unemployment numbers come out?

You have not missed the bottom so do worry about that. What you're seeing is the market going up from a handout from the government. Plain and simple that's it. Nothing has changed - Companies aren't magically doing better - It's just smoke and mirrors right now

I think 15,000 is a fair bottom.

When the unemployment numbers come out reality will begin to set in big time because the number are going to be bigger then we've even seen before.

[beshannon]

Originally Posted by jpeezy14@hotmail.com

https://www.marketwatch.com/story/no...S%3D1585145451

Quick read on the Chinese economy and how it could affect American companies. Long story short - China might not be back to the levels that everyone thinks.

Good article. I never trust data out of China anyway, I am just glad to see small improvements there and hopefully things will continue to improve and move forward.

I just added NKE and CL (small positions) to upgrade quality and rebalance a bit

[vipereaper30]

Originally Posted by m j b

- jump in and out in a most nimble manner, day trading and quickly cutting any losses when you guess wrong. Because it's all guessing at this point.

Nice work in AAL! I got caught not practicing this advice ^^^ yesterday and didn't close a short in SAVE, amongst others that have faired better. But yesterday was a brutal reminder of this lesson thank you for sharing.

[beshannon]

Solid bounce happening, a lot of chatter about a deep sharp quick recession, much bad news priced in, we have seen A bottom but most likely not THE bottom

Timing is futile, focus on longer term and unless you are a day trader, these large moves should provide points for buys/sells in your portfolio to rebalance and add cash if necessary.

I am at my lowest cash level in a very long time as I believe opportunities here are more compelling rather than to try and find a marginally lower price.

The charts suggest that the Dow and the S&P 500 came close to bottoming, but there might need to be a bit more capitulation before the decline exhausts itself,
@JimCramer
says

https://www.cnbc.com/2020/03/24/jim-...source=twitter

[JParm]

Originally Posted by beshannon

Solid bounce happening, a lot of chatter about a deep sharp quick recession, much bad news priced in, we have seen A bottom but most likely not THE bottom

Timing is futile, focus on longer term and unless you are a day trader, these large moves should provide points for buys/sells in your portfolio to rebalance and add cash if necessary.

I am at my lowest cash level in a very long time as I believe opportunities here are more compelling rather than to try and find a marginally lower price.

Agree with your points here, though I'm staying out of it today. I have a feeling the next couple days will be a bit more volatile than what we're seeing now.

My "keep an eye on" stocks that I'll be adding to in the next few days include DIS, HON, NKE...essentially, value-driven stalwarts that should no doubt rise over time.

GOOG, FB and TSLA are also on my watch; GOOG hovering around 1000 is very attractive.

[beshannon]

Originally Posted by jpeezy14@hotmail.com

Agree with your points here, though I'm staying out of it today. I have a feeling the next couple days will be a bit more volatile than what we're seeing now.

My "keep an eye on" stocks that I'll be adding to in the next few days include DIS, HON, NKE...essentially, value-driven stalwarts that should no doubt rise over time.

GOOG, FB and TSLA are also on my watch; GOOG hovering around 1000 is very attractive.

Agreed and good shopping list

I should start buying paper stocks with as many legal pads as I go through updating my shopping lists

[Bearxj86]

Originally Posted by m j b

Here in NC, the average unemployment check is $240 a week, with a maximum of $350. Can you live on that? Most people cannot pay their bills on that kind of income. I suspect most states are similar, in that they don't pay 100% of the lost wages.

And then you've got the "gig" workers, the self-employed, the business owners, etc. who do not qualify for unemployment.

"Is there a reason not to do unpaid leave to help with company liquidity?"

Are you serious? Studies consistently report that (according to the Federal Reserve Board) 40% of Americans cannot afford an unexpected $400 emergency expense. How then could they possible go with unpaid leave for more than a day?

Sorry, we (me) are digressing from the topic. But the stimulus, I fear, will not directly help the stock market, because once the numbers get crunched and what was hoped to be grants are really just loan guarantees, people will see that it's not going to help many companies.

IMHO.

The stimulus bill this morning is $1200 directly and an increase of benefits of $600 per week. So the monthly increase will be $2400 from where it is today. I think thats good enough for the average dude/dudett. Not saying it is a magic pill but enough to tide most Americans in a frugal way for 4 months. So if we use your $240 and increase it to $840 a week, would that make you feel better about the state of things for 4 months? $3.2k a month on top of an initial booster of $1200 I think is good stuff man.

lawmakers hope that the $1,200 checks will be spent across a range of industries.

The deal also includes a massive expansion of unemployment insurance. Schumer called the agreement "unemployment compensation on steroids," and said the maximum unemployment benefit will be increased by $600 per week to ensure “that laid-off workers, on average, will receive their full pay for four months.”


Because of this, my company along others are seriously considering unpaid leave to minimize working capital spend (since this benefit would make the workers whole). Bear in mind that most customers and suppliers are holding on to their receivables and payables and not paying. So unpaid leave really helps with cash flow.

Link: https://www.yahoo.com/finance/news/c...080739448.html

[Bearxj86]

Also another potential market mover that changes the strategic plan on how to respond:

This morning, blood testing for Coronavirus immunity seems to be very imminent. Seems once you have the antibody, you can be immune for months.
1) https://www.nytimes.com/reuters/2020...t-insight.html

And those that are immune seem to hold the key to the vaccine
2) https://www.wired.com/story/an-old-s...s-blood-serum/

[Bearxj86]

Back to stocks, here are the stocks I picked up in the past 2-3 weeks, ups and down but overall up or flat. In the end these are long term plays. No in and out trading for me.

"Winners" / long-term hold (don't look anymore):
1) Amazon - Up 8% in 2 weeks
2) FedEx - Up 34% since last week buy
3) ARB - Mortgage REIT - Up about 25%
4) OHI - Healthcare REIT (Up about 15%)
5) GEO - Healthcare and Correctional Prison services REIT (Up about 15)
6) TSLA - Look at their balance sheet (Up 24%)
7) BUD - Up 14%
8) ACT - Up 8%
9) Hold on BRK-A (Had it for years) - Down about 15%

Losers:
1) SmileDirectClub - absolutely hammered (down 75% since 2 weeks ago and around 85% from IPO) - however 3d printing for Aligners is game changing
2) Brief stint with DAL but decided its not for me after fundamental analysis show them needing bailout funds after travel restrictions

[JParm]

Originally Posted by bearxj86

Back to stocks, here are the stocks I picked up in the past 2-3 weeks, ups and down but overall up or flat. In the end these are long term plays. No in and out trading for me.

1) Amazon - Up 8% in 2 weeks
2) FedEx - Up 34% since last week buy
3) ARB - Mortgage REIT - Up about 25%
4) OHI - Healthcare REIT (Up about 15%)
5) GEO - Healthcare and Correctional Prison services REIT (Up about 15)
6) TSLA - Look at their balance sheet (Up 24%)
7) BUD - Up 14%
8) ACT - Up 8%
9) Hold on BRK-A (Had it for years) - Down about 15%

BUD, FDX, TSLA also on my list.