2020 Stock Market Crash
en.wikipedia.org
en.wikipedia.org
Ppl default on loans because they lack cash flow
banks didn't account for this with lax lending standards
banks go bankrupt but TARP style program bails out banks
hopefully people stay in their homes ...somehow. (some kind of mortgage payment moratorium?)
Canadian banks have been hit hard due to falling oil prices and expected resultant bankruptcies.
American banks will get hit by rising unemployment.
Pretty sure the ratings fraud got fixed. Also pretty sure they didn't just go back to handing loans out to anyone with a pulse. I'm sure there's some crazy intricate financial instruments made up of dogshit still around, but it's probably going to be a smaller percentage of the bank's balance sheet.
But the pin could have been some other event, at some other time. All crashes have catalysts, but the specific catalyst is usually irrelevant, in hindsight.
The pattern is the same: years of deregulation allow financial giants to go on a feeding frenzy. They feed on ill-informed consumers by enticing them with deals that are too good to be true. They feed on each other by giving each other loans. The numbers look great for a while. Individuals within these firms get enormous bonuses because the numbers are so good. Then there is a moment of reckoning where the financial giants realize their credit exposure to each other is too high and furiously backpedal. They then try to obtain safe assets at any cost, crashing the market and decimating IRAs (but who cares about those).
This has not been caused _by_ coronavirus. Internal data from my company (sorry, no details) have been foreshadowing a recession for months. Coronavirus just came at the most inopportune time, with a financial house of cards primed for collapse and a USFG administration that's too inept to handle it (and which encouraged the feeding to begin with).
The banks are going to be hit by this, but they'll survive it one way or another. Those of us who are invested in the financial system (read: almost everyone) will get screwed. Then the financial giants, freshly bailed out with taxpayer money, will go purchase real assets at rock bottom prices and further consolidate wealth in time for the next bull market.
This is when we could use an FDR to break this cycle. Instead, we have the choice of Trump, Biden, or Sanders. Yikes.
FWIW: I think the much bigger long-term risk to this wikipedia article's framing is that the crash almost certainly isn't over. We have months of VERY bad economic news in the future still. Realistically the recovery won't even start for real until either the virus runs its course over the population or a vaccine is widely available. Both of those are going to take a year or more.
(Well, it's possible to get the virus to go faster of course. We don't want that.)
Rather than having at-risk people self-quarantine for a month, with government financial assistance of course, while the rest of us build up antibody resistance, we collectively lost our shit and decided all people needed to self-quarantine for months -- just delaying the inevitable.
It's actually quite easy to self-quarantine everyone over 70, since they're receiving government assistance anyway (Social Security). But now there are already thousands of job losses from young, healthy, productive people that have almost zero chance of dying from this disease.
The UK will be mostly done with Covid-19 in two months, with much less dire economic consequences -- and the US will still be playing whack a mole and killing the economy with healthy 25 year-olds holed up in their apartment.
But the point I keep hearing from knowledgable people is that rapid spread is inevitable at this point. So many or most of the dramatic actions taken by state and federal governments now are security theater.
The point I keep hearing from every reputable epidemiologist, virologist, and public health expert around the world is that people need to stay the fuck at home because this virus is extremely dangerous and if left unchecked will completely overwhelm every hospital system in the world.
Some public officials didn’t believe it when it was just Hubei, but after seeing the same happen in Lombardy, a rich region in Europe with a strong healthcare system, the situation became clearer.
Edit: here’s a nice summary written by a Bay Area marketing executive (based on work by epidemiologists and others) https://medium.com/@tomaspueyo/coronavirus-act-today-or-peop...
* * *
If you spend some time hunting around for career epidemiologists and other experts to read, they are as far as I can tell unified in opposition to the British plan, and have been calling it out as sheer folly in published opinion pieces and ranting about it on twitter.
For example, https://www.theguardian.com/commentisfree/2020/mar/15/uk-cov...
I guess we’ll all see how things play out in the next month or two, but I’d much rather be in South Korea or Taiwan than England right now.
https://www.imperial.ac.uk/media/imperial-college/medicine/s...
> We have around 5,000 ventilators and we think we need many times more than that. We are saying that if you produce a ventilator then we will buy it. No number is too high.
They've had at least a month of knowing this was coming...
I think you should take a look at what’s happening in Italy right now, and understand a lot of countries are going to experience the same thing.
The basic issue is that as the virus spreads exponentially we’ll quickly run out of intensive care beds and ventilators. At that point, the mortality rate of Coronavirus goes way up and so does the mortality rate of many, many kinds of acute illnesses. Because there will be people in need of immediate care and there will literally be none available.
The economic crash will be softer, shallower, and rebound quicker depending on how disruptive the Coronavirus ends up being. Strong, facts-based actions early will have a massive disproportionate effect for the better.
I agree the US is screwed, but it’s because we have not and still are not taking this seriously. We’re still taking basic steps to ramp up testing capability when we should be desperately building out emergency ICU capacity.
1. https://www.worldometers.info/coronavirus/coronavirus-age-se...
It’s not like younger people are a self-contained sub-population. Increased rate of transmission among younger people means an increased rate of transmission to older people too.
In Italy they initially took a relatively light approach to restrictions and the result was the Northern Italy's hospitals were quickly overwhelmed by cases. This has the effect of not just meaning increased mortality amongst covid-19 sufferers but also all the other patients who would usually be using those hospital facilities.
In south Korea they seem to have had a much more draconian response (after the initial surge of cases) and as a result have got the rate of increase under control, allowing the more serious cases to be better treated.
The difference in mortality rate between these two countries is stark, and whilst there are other factors (demographic ones) in play, it seems fair to say that gov. response plays a role.
The other argument for a stronger response is the longer this goes the more likely effective treatments will be developed/validated, reducing mortality.
South Korea's success is all about their widespread testing.
The difference in mortality rate is because South Korea knows how many people have it, and Italy has no clue. Which, again, is because of testing, not quarantine.
Heck the UK, who's response I gather you favour, are cutting the sets of people they test, not increasing them.
Is it though?
What about the ones in nursing homes? How do you quarantine the workers who work there? What about when the over-70s living at home have to go to the doctor, or for their chemotherapy or dilation treatments? How are they going to isolate themselves from all the people they'll interact with while doing that?
> The UK will be mostly done with Covid-19 in two months
Is what they're hoping. We won't really know for another 2 months. At that point they'll either look like geniuses or callous morons. And if it's the latter, it'll be too late to change course.
If we would follow South Korea's example, and test as many people as we could, we would be now over the hump.
Your suggestion is indistinguishable from no quarantine at all (not to mention being incredibly ageist, as there are millions of economically productive 70+ year olds). You forgot the part where even a 'healthy' 25 year-old can spread the disease to others, even if mild or no symptoms appear.
The problem is that some are doing it, some are not. And then they are doing it on different schedules.
We understand nuance from the past. For example we understand that the assassination of archduke Franz Ferdinand didn't cause WW1, even if it directly led to it.
Why worry that future historians won't understand such nuance from the present?
Do we? We don't always have all the information…
"We understand nuance from the past."
Where:
We = {Specialized Historians}
I think the OP meant more that the general public's perception would be wrong. I think that's probably more likely correct.
Also, I'd be wary of thinking (as others down thread have done, you are not guilty of this) that the general person thinks the assassination caused WW1. It's clear that many people are in fact taught that it merely triggered it. It is arrogant to assume it's not a well known fact, a case of "Well the masses are stupid and think X" without evidence that the masses do in fact think that.
Indeed I am not a specialized historian, it was part of my (and all my peer groups') general education (GCSE history).
Does being able to apply pythagoras make a "specialized mathematician", or knowing "Dos cerveza por favor?" make a linguist? No, it's part of a rounded education. Not everyone achieves even a basic standard (as my attempt at Spanish likely shows), but as long as the specialists do exist, then they can write the text books for the general education and correct the record.
If big banks start going belly-up, they're going to use corona as a convenient (and dire) excuse for bail-outs, understating all the bad loans and toxic deals they've made in the past.
Also, consider that there are always people (especially on HN) predicting stock market crashes. I'm not sure it makes sense to ascribe the ability to predict the market to people who happened to be right.
Something would have popped the bubble, and I’d argue the real cause of the start of the downturn was OPEC and the bottom falling out of the oil market. Then COVID set in and made things a million times worse, making a quick recovery nearly impossible. That’s what will be remembered by lay people, while experts will hopefully remember you can only pop a bubble if there is a bubble to be popped. And OPEC/COVID didn’t create the bubble, they just popped it.
1) Europe was a powder keg. The assassination was a single item is a list of reasons a war happened.
2) The escalation of war to involve multiple countries happened only after multiple attempts at de-escalation. Saying generally that leaders wanted to go to war is a massive oversimplification of the start of the war
Everyone knows about the student debt crisis. Everyone knows that public companies were borrowing to pay for stock buybacks. Everyone knows about the rampant de-regulation and rent seeking. And nobody thinks any of these issues will be addressed in the coming years.
It's going to be the 1980s all over again.
Because the small subset have a lot of motivation to advocate for the status quo, and each individual outside the subset has only a small motivation to advocate against it.
Certainly there are many underlying factors, but a massive change in consumer behavior with a somewhat open-ended timeline is itself much worse than many of the other issues in the economy.
Like in Sneakers:
People think a bank is financially shaky
Consequence: people start to withdraw their money
Result: Pretty soon it is financially shaky
In other words, stores running out of things and/or online sales being strong aren't, by themselves, the cause of major market movements right now; it's speculation about what'll happen tomorrow, and making sure you don't own any of the stocks if & when it tanks. Which incidentally causes the stocks to tank.
Amazon for instance started running out of generic Tylenol and other items you're recommended to have on hand yesterday.
I was putting stuff in my cart Saturday only to have it be unavailable for the forseeable future by Sunday.
Online merely lags behind brick and mortars. They'll probably have more stuff available since you aren't browsing but searching for specific things, but for things everyone thinks they need, they won't be doing much better.
There are even more issues going on, including the oil price war and an overheated market in general, so simplifying it down to "corona" will still be incorrect. But even as the downturn accurately reflects some realities, it's still only a partial correction.
Many of those conditions have been present for a LONG time and people have been predicting a correction or other events for years ... and they just haven't happened.
Fair or not, I have serious doubts anyone is selling stock right now because they're concerned about student debt or etc.
I feel like in every crisis we get laundry lists of people who cite "things that I'm concerned about are the real reasons" and so on.
Little did we know that the concentration of talent in Bay Area, Seattle, NYC and maybe London and Vancouver would be the trigger. I wonder if this gets any worse, and if one team coincidentally is wiped out, would the org be able to actually play their DR scenarios and rebuild their stack!!
Closing borders, flights, events, bars, and restaurants has way more impact.
Really?
This is an incredibly self-centered and myopic view of things.
Bro, the software industry isn't the center of the universe, or the global economy.
Restaurants are closed, travel is at a standstill, events are getting cancelled, and you're over here talking about engineers getting sick..... wow.
When we talk of the 1 percenters, when we talk of 0.1%, we are talking about wealth being unequally distributed. When we look at S&P or nasdaq, we see the pumping up of market in select names only. Forget the past month, and go look back at the past 3 years and compare the growths of tech companies with the non tech and see the difference. And the topic of this thread is market crash, not the dystopian or utopian world so my perspective is pretty much based on that.
Also, I am not saying the country is not at the standstill, but our whole supply chain, our whole messaging(WhatsApp and what not), a lot of our healthcare runs on software being managed by teams of 5-15, in many cases run from the same building. Not everywhere but in so many companies. I am not laying out a conspiracy theory just laying down the facts, as I understand them. If having a second data center is essential to modern DR, why is the same need of redundancy not relevant for people.
Demand for digital services has gone up due the epidemic. Big Tech will do fine, but everything around them may crumble.
This seems to be people who were skeptical about the market attempting to prove themselves right by piggybacking their favorite reason-the-market-will-crash onto this event.
The virus is literally shutting down economic activity. High leverage never shut down an economy.
A complete suspension of commerce in the service sector due to a sudden, unprecedented change in consumer behavior is a massive economic shock that I've never witnessed in my lifetime.
The good news is that this isn't a case where there is a lack of capital available (like 2008), and many businesses will be able to weather it. However, we need to be very aggressive about bailing out the businesses that are too small or constrained to weather the storm.
If George W. Bush or Obama or Clinton were president, you would have had a better reaction and communications plan than what you’re seeing here.
All of those other factors are there, but the panic is because of the actions of the government.
It sucks. I’d guess it’s 50/50 that I’ll be unemployed by January, and 30/70 that I’ll lose my home as my major assets (house, retirement, etc) are attrited down. When the risk of infection wanes, we should be taking to the streets.
Besides, isn't the stock market too complicated that it can't be controlled, not even by POTUS?
Comparing the Federal response, you have a lack of coordinated response, inaccurate information from the POTUS, contradictory responses from Federal agencies, a focus on self-praise and prayer, etc. Last night (3/15), the government had a stockpile of venilators. This morning (3/16), reports are that the POTUS told states to find their own. Having a politician like the Vice President that knows how to speak effectively be the sole speaker would be better, even with the incompetent response.
People and markets want to hear measured responses. After the shock of 9/11 wore off, people took solace and unified around the government's response at the Federal, State, Local level. In this, we're leaving Governors, mayors and companies to fend for themselves.
You fell for the fake news media and their usual tactics. It's not like it's hard to listen to his actual speech and draw your own conclusions about the media and the POTUS.
https://www.thepostmillennial.com/busted-again-the-new-york-...
tl;dr he said: “We will be backing you, but try getting it yourselves. Point of sales, much better, much more direct if you can get it yourself.”
There is no strategic reserve of respirators or respitory therapists anyway. The military probably has some for deployments, but not in meaningful quantities for a national scope.
I'm not worried about context. I'm concerned with malicious misquoting in order to smear the POTUS, by a once reputable newspaper with very low standards for journalists these days. The president said he'd support the states but if they also try to purchase directly rather than just wait for the federal system to do its work, it might be better. There's absolutely no way one could honestly interpret this in a negative way.
I wasn’t a fan of GW Bush, but his response to 9/11 was on point. An emergency was declared and those emergency powers were used immediately to procure items needed for recovery or ensure that states and cities had access to cash to meet their disaster obligations. Only now is the federal government slowly engaging.
It’s not a smear, it’s a fact — this administration is paralyzed into inaction by nepotism, lack of effective command and fundamental incompetence. Thousands will suffer as the economy implodes or will die or be hurt by the pandemic as a consequence.
None of these were factors in the current crash, that's just fairy tales, magic thinking and posturing by self-proclaimed experts and ideologists who were preaching against capitalism. This crash was caused by a) dropping oil prices and b) the fears and uncertainty (well, increasingly certain negative outcome) around the impact of Cov-19 on the economy.
- debt worldwide hits 86k per person [ref: https://news.ycombinator.com/item?id=18683923]
- people buying cars using financial products they don't understand [ref: https://news.ycombinator.com/item?id=14476381]
- rollback of federal oversight [ref: https://www.nytimes.com/2018/05/22/business/congress-passes-...]
- wage stagnation [ref: https://news.ycombinator.com/item?id=19253364]
- how consumers and lenders pursue consumer debt [ref: https://www.propublica.org/series/unforgiven]
With Coronavirus 90%+ of companies will be directly affected in reduced revenue. Either directly like companies that are focused on retail, or indirectly, companies that are affected by challenges in logistics.
Was the market perhaps inflated, in my opinion yes, but I don't see how people can say this crash wasn't caused by coronavirus.
Could we have had a crash or reset in the future without the virus? Most likely. But that unknown reality didn't happen. Instead we have a global pandemic, where the only real working solution is to institute various levels of lock down and social distancing, which will slowdown economic spending dramatically.
If the entire global market has to take 2-months off from generating revenue, that is a huge blow to the system. Then you have the secondary effects. Job losses, businesses closing, rent, evictions, closures, etc.
The economic impact of this will take 6 months to play out to see where the bottom is. Not all companies and industries will be affected the same way, but generally speaking only a small handful of companies will really get through this without some sort of impact to their business.
It's like saying we believe that the market was overheated due to zero interest rates, but we were hoping to have the market head into a recession on it's own, rather than have an outside event cause the global GDP to stop for 2 months. But since that is so obvious, we won't accept it.
How many households have two months of savings. How many businesses can go for 2-3 months with 80% reduction in revenue and if they have the savings to cover that.
I think this event is much larger than a simple recession that would have occurred as a result of speculation and low interest rates.
This is literally stopping the world economy for 2 months and seeing how many households and businesses have enough savings to counter balance that while stress testing the governments ability to intervene, not at the top end, by providing funding to banks, but at the bottom end, of figuring out how to get all of the people who work as waiters and waitresses to go without revenue for 2-3 months and not get evicted or rack up debt that they can never escape from.
I think you are underestimating the impact of this.
If the middle class was on stable footing right now, lack of spending and consequently revenues wouldn't experience such a huge shock. It's a house of cards.
If you think that speculation, debt, and interest rates aren't capable of causing a system wide collapse with far reaching effects, I'll go ahead and refer you to the 2008 crisis.
The shaky foundation aside, if everything was valued appropriately, and there was no speculation, the impact of coronavirus alone would be enough to send the global economy into a recession due to lockdowns, change in consumer spending behavior, and the lack of income for million of people for even two months who are already living pay check to pay check.
Bottom line is, it seems to me that when the world's richest nation has to outsource the making of anything tangible to the place where the outbreak started, and so much of our economy is based on services of questionable value, we're in for a world of hurt. You can't fight this war with military hardware and social media VC.
The stock market is just the beginning - what about the millions of people making ends meet as waiters, Uber drivers, AirBnb hosts, retail store clerks, and every other in-person job? HN might not feel this much, as the tech industry is making a pretty easy switch to working remotely. But do not be blind to the facts: the overwhelming majority of the workforce doesn't have an emergency fund and won't be able to ride this out easily, if at all.
Apple stores are closed. Ad spending will collapse for Google and Facebook. Future financing rounds will dry up. Unless this is a short term quarantine effort, layoffs are coming for tech too.
Unfortunately many of these are not even jobs, they’re now “contract positions” or “marketplaces” so they have no protection. We’ve traded away every backstop that could help in a crisis for convenience and investor returns.
I do - over the last 10 years of extensive money printing companies seemed to be healthy, but gathered structural problems, which were not only not solved, but deepened by expanding regulations and such. Just before the crisis started most of the investment grade instruments were BBB (one slight blow away from junk).[0]
In December there was a presentation by the local Mieses Institute where a hypotetical scenario similar to what is happening right now (it was a war near EU + another migrant wave leading to in-EU border closures and state of emergency in multiple countries) was played out. What was predicted is extremely similar to what is playing out right now, though the initial shock was supposed to be weaker. I am really sorry the presentation was not in English, it really had all my thoughts put together in a very coherent way.
Keep in mind that the 30% drop is just market panic. There have been no bankrupcies, defaults and layoffs yet. This is when the fun is going to start.
Another thing that was predicted exactly was that if you look deeper, beyond the indexes, at how the first tranche of the $1.5 trillion package was spent you'd see that hot companies like MSFT restored their value, while troubled ones like UAL received almost nothing. So the bankrupcies, defaults and layoffs have not yet begun and we are already 30% down. What is going to remain after they're done?
0. OECD - "Figure 8. Composition of the investment and non-investment grade categories" https://www.oecd.org/corporate/Corporate-Bond-Markets-in-a-T...
P.S. The rest of the OECD report makes for a very very interesting reading in a time like these. But what you're looking for in it is how at year 2000 most common investment grade is A followed by AA and BBB about even, while now it is a total clusterfuck (with apologies).
but it might certainly help, for example, people might be willing to risk getting corona (if they are 20-40 year old) and are asked to do a job for a lucrative amount of money.
Republicans are currently blocking this.
If this continues to be blocked, we can expect to see 7% declines until such legislation is passed and the market sees that there is a path to recovery. Who knows maybe we’ll get another depression too.
NASDAQ: -25% in one month. CAC40 (french stock market index) : -33% over the same period.
These stock markets collapsing is just stupid, it just shows that it's pure speculation...
The world economy takes a break during let's say 2 months (everything will resume as before afterwards) and hundreds of billions of euros/dollars disappear.
In fact, the question is: If everyone stops working because of the covid19, if the whole economy is paused (which is basically what is happening) why doesn't the stock exchange do not simply stop too? When a company presents quaterly financial results, it's over a period of _activity_. But then at the moment it's a period of total inactivity... ?!
At its base, the stock market is just "you" owning a company. The economy isn't paused for two weeks - many companies will have to continue paying people money, paying their suppliers, paying rent on their offices, etc.
Let's say you own a company that usually has say 100k in earnings and 90k in spending, making you 10k profit every month. That company now has, because of the virus, say 50k in earnings instead, and 80k in spending (it reduces some salaries where it can, but still has to keep the offices around etc.) That company is now going to be losing money for a few months.
Now you own a chunk of this company. Yesterday you assumed it was worth 10 million dollars. Today, do you agree that it's worth less? After all, it's going to be losing money for a few months at least.
Notice that it's only worth less on paper - if you don't sell your ownership stake, then you haven't really seen a loss.
But a lot of people are selling their ownership stake. And that makes sense! If you're 60 years old and need cash right now, and you own a company that, instead of earning 10k a month, will now be losing 40k a month, you might want to sell your share to not lose money, because you need cash. Maybe some other investor that can stomach losing a few months' of profit can take it off your hands.
Expecting another rally followed by another crash
To note here though, 4 of the top 10 largest gains on record have also occurred in this timespan too.
Still, per the wikipedia article's point, the last 7 days has been VERY bad for the DJIA. There is no sugarcoating this.
https://en.wikipedia.org/wiki/List_of_largest_daily_changes_...
https://www.forbes.com/sites/abrambrown/2020/03/16/the-priva...
Flights are sharply down, large events all over the world have been cancelled, millions of people are quarantined in their homes. If that doesn’t qualify as an “underlying financial event”, I’m not sure what does.
There seems to be this weird idea floating around that because this financial crisis was triggered by events in the real economy (instead of a financial crisis blowing up the real economy, like normal) it somehow doesn't count or it's overblown or something. Just look at the rest of the sentence I quoted: "and I think we know roughly how bad this can and will get and it is not financial crisis worthy."
Airline stocks have tanked because way less people are flying. Movie theater stocks have tanked because way less people are going to movies. This financial crisis seems to be firmly rooted in real world events. These companies are truly worth a lot less than they were a month ago.
What I'm saying is that this financial crisis has a clear, identifiable cause: covid-19. When covid-19 blows over (which it will in a few months time), the market will recover. Without covid-19, travel bans will be lifted and people will fly again. There's no reason to believe people are done with airlines forever. Same with movie theaters and the restaurant industry.
My argument is that the underlying primary cause of the financial crisis matters because it determines the path to recovery. I fully expect covid-19 to disappear in a few months (as it has in China and South Korea), and I fully expect the market to recover in the months afterward.
And that is before we consider the actual impact of the corona virus itself.
The huge danger is in china’s real estate market, which could undergo a huge correction mimicking the turmoil of china’s property market in the late 90s. As many Chinese have speculated in hot property markets here in the USA, those effects could easily come here (again, like what happened with Japan).
There is a financial event. Massive drops in demand. I think people have gotten used to market crashes caused by issues in the financial system itself (bubbles/subprime mortgages) and forget that there can be other issues
Lowered demand for consumer goods and services naturally mean that these companies will be trimming the fat on SaaS products, and infrastructure (unless it's truly critical for work, ie Zoom) which in turn means less technical jobs.
The first things on the chopping block, as we consider where to trim expenses, are those "expensive", useful, but not critical software systems with terms ending soon.
Except Zoom. That baby is keeping us rolling.
Regular companies with healthy projects, revenues and employee count sized according to their current need and not according to y+5 revenues -> will do just fine.
ColdFusion was a popular language, easy to learn, and as a result, led to a lot of folks getting really high paying jobs during the dot com boom. When work dried up, they didn't have the flexibility to do other jobs, because ColdFusion is all they knew.
In today's world, I think the front-end dev who just knows their favorite framework of choice will suffer. Not just the one-trick pony thing, but on a lot of apps these days, complex front-ends are a "nice to have". Tighter budgets and needs will force a refocusing of development priorities.
Arguably much the same (in my opinion, to a much lesser degree) could be said about frameworks like Ruby on Rails, if that's all you know. Flexibility is key.
However, in a downturn, software can be a powerful tool for streamlining. If you know at least one backend language and are devops-capable, you'll be better positioned. The jobs will be boring jobs, in boring companies, on boring infrastructure, but that's OK.
US hasn’t even gotten proper sick yet and a big chunk of the world market cap is US based
The next phase of this Act will claim all those profitless companies with high costs and burn rate who will soon collapse.
I highly recommend: "Eight centuries of global real interest rates, R-G, and the ‘suprasecular’ decline, 1311–2018." https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3485734
Related to the paper:
- Visualizing the 700-Year Fall of Interest Rates https://www.visualcapitalist.com/700-year-decline-of-interes...
- Macro Musing podcast with author: https://soundcloud.com/macro-musings/paul-schmelzing-on-the
As a side note. I know a significant amount of people (relatives and friends) that truly think this event is a big "liberal conspiracy" to stop Trumps reelection. We've had to take my grandfathers keys because his favorite news station is telling people this and he believes it so was continuing to go out.
There is also the issue that economic annealing has optimized all of the slack out of supply and financial chains. That should have been dealt with during the good time (similar how USG should have kept domestic mask manufacturers alive). But it wasn't, and the only way forward is for that risk to be re-priced-in.
Its unprecedented and it needs to be shutdown.
According to https://goldprice.org/ it's +16.57% on the year
Also, it's still doing WAY better than stocks.
I guess you're talking about the 1-year price change.
Source: goldprice.org
You're just paying fees for no reason. Is it just some tax trick to keep long term capital gains for the index funds? (does it even work like that?)
Someone really wanted to work that in there.