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My take on the selloff is people looking for liquid cash. Very similar to stockpiling home supplies. People are looking for stuff they can use or trade in the v

My take on the selloff is people looking for liquid cash. Very similar to stockpiling home supplies. People are looking for stuff they can use or trade in the very short term because they don't know how bad it would get. It's a lot harder to do that today with crypto. I haven't seen anyone with strong reason to believe that companies are gonna be that much worse off a year from now than they were a month ago, or for the four years after that, so I don't see a reason to sell stocks based on expected company performance anymore than to sell crypto - but in the short term, everyone's stockpiling immediate goods.

rabuse 7y ago
Exactly. It's like here in Florida, when the systems go down after a hurricane, cash is king in the digital age.
Finnucane 7y ago
That sorta depends. The energy companies are getting squeezed by the oil price war, and they are heavily leveraged and dependent on high prices. A lot of companies loaded up on cheap debt, so the banks are screwed if liquidity issues mean defaults.
isk517 7y ago
I wouldn't be surprised if there was significant amount of sell off occurring because people are looking to start stockpiling home supplies. I've known more than a few conspiracy minded people that collect crypto currencies due to a belief that it will be a safe haven in the event of a government collapse, and the current Corona virus panic is probably causing a lot of them to realize that all of the bitcoin in the world may not be enough to get you a single roll of toilet paper if that time ever came.
agumonkey 7y ago
IIUC the metatheory is that in times of crisis btc would strengthen and become more fiat than fiat.. so far it's not. But who knows ... maybe people will leverage the events to move forward on crypto in the next weeks...
comicjk 7y ago
The average company a few years from now will probably be as profitable as the average company last year. But that's survivorship bias: some of the companies from last year might not be around anymore, and it's hard to predict which. I think that fear might be driving lower valuations.

rabuse 7y ago

Exactly. It's like here in Florida, when the systems go down after a hurricane, cash is king in the digital age.

Finnucane 7y ago

That sorta depends. The energy companies are getting squeezed by the oil price war, and they are heavily leveraged and dependent on high prices. A lot of companies loaded up on cheap debt, so the banks are screwed if liquidity issues mean defaults.

isk517 7y ago

I wouldn't be surprised if there was significant amount of sell off occurring because people are looking to start stockpiling home supplies. I've known more than a few conspiracy minded people that collect crypto currencies due to a belief that it will be a safe haven in the event of a government collapse, and the current Corona virus panic is probably causing a lot of them to realize that all of the bitcoin in the world may not be enough to get you a single roll of toilet paper if that time ever came.

agumonkey 7y ago

IIUC the metatheory is that in times of crisis btc would strengthen and become more fiat than fiat.. so far it's not. But who knows ... maybe people will leverage the events to move forward on crypto in the next weeks...

comicjk 7y ago

The average company a few years from now will probably be as profitable as the average company last year. But that's survivorship bias: some of the companies from last year might not be around anymore, and it's hard to predict which. I think that fear might be driving lower valuations.