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I'd expect percentage losses as deep as those seen in 2007/2008. This isn't just paper money drying up, it's the inability to physically work. It's not just a m

by Klinky 7y ago

I'd expect percentage losses as deep as those seen in 2007/2008. This isn't just paper money drying up, it's the inability to physically work. It's not just a matter of injecting a ton of capital into the economy, literally that capital cannot do anything if people can't work. We'll also see hyperspecialization towards COVID-19 in the health sector, which could leave those industries vulnerable when COVID-19 finally runs its course(likely many months from now). Some industries are already failing, and will need propped up. If not, then those industries will take awhile to recover after COVID-19 runs its course. Also I'd be incredibly wary of huge single day gains. Consistent slower gains is a better sign of a healthier economy than the spiky behavior we've seen as of late indicating people are heavily speculating on the volatility.

vidanay 7y ago
The big difference is that 2008 was a systemic recession. This one will likely be situational.
- aguyfromnb 7y ago
  >The big difference is that 2008 was a systemic recession. This one will likely be situational. "Systemic"; what does that even mean? That the crisis was related to the financial system? Yes, it was one type of financial crisis. We are now in another. If you believe that the unravelling we are seeing is simply because of the Coronavirus, I think you will be disappointed. While this may not be the same as 2008 (no two crises are the same), there are a number of "systemic" issues in the world that will come under pressure: - Privately held companies with ridiculous valuations (WeWork, SpaceX) - China having taken on more debt in 10 years than anyone, ever - Negative interest rates around the world going *into* recession - The shale industry blowing up - Housing bubbles that didn't implode in 2008 (Canada, Australia) coming under pressure - Fiscal and monetary stimulus in the US like we've never seen - Risk Parity unwinding These are off the top of my head. Maybe they all mean nothing, but I doubt it.

by Klinky 7y ago

vidanay 7y ago

The big difference is that 2008 was a systemic recession. This one will likely be situational.

aguyfromnb 7y ago
>The big difference is that 2008 was a systemic recession. This one will likely be situational. "Systemic"; what does that even mean? That the crisis was related to the financial system? Yes, it was one type of financial crisis. We are now in another. If you believe that the unravelling we are seeing is simply because of the Coronavirus, I think you will be disappointed. While this may not be the same as 2008 (no two crises are the same), there are a number of "systemic" issues in the world that will come under pressure: - Privately held companies with ridiculous valuations (WeWork, SpaceX) - China having taken on more debt in 10 years than anyone, ever - Negative interest rates around the world going *into* recession - The shale industry blowing up - Housing bubbles that didn't implode in 2008 (Canada, Australia) coming under pressure - Fiscal and monetary stimulus in the US like we've never seen - Risk Parity unwinding These are off the top of my head. Maybe they all mean nothing, but I doubt it.