Discussion ***Official*** 2020 Stock Market Thread

[dasherHampton]

Under the previous CEO, sure. But under this new guy the turnaround seemed to be taking hold until the virus hit.

 

[JEDI]

so NCL announces it might go bankrupt.
then the next day, it announces $2B infusion.

why would a company announce that might go bankrupt if they are in talks for $2B?
wouldnt that hurt their chances in securing the $2B?

 

[KB]

so NCL announces it might go bankrupt.
then the next day, it announces $2B infusion.

why would a company announce that might go bankrupt if they are in talks for $2B?
wouldnt that hurt their chances in securing the $2B?

I think FelixdeCat had it right when he said:

"..... they issued the going concern statement as a standard precaution. When your company is impaired to the point it is no longer operating then you should warn shareholders that your ability to stay in business is in doubt unless you can start sailing ships again. "

There was no guarantee they would get the $2B and they are obligated to let shareholders know about their money issues. Anybody giving them $2 billion would have access to their books and would know of their dire situation. I am surprised they are only up 2% pre-market.

 

[Svnla]

I mentioned Carnival, not Norwegian. But as far as NCL is concerned they issued the going concern statement as a standard precaution. When your company is impaired to the point it is no longer operating then you should warn shareholders that your ability to stay in business is in doubt unless you can start sailing ships again.

A lot of companies should be issuing going concern statements such as most oil and gas companies. If you believe cruise lines will all go out of business, then please DO NOT buy any shares. You are right to be skeptical.

As I said above, Airlines is not that pretty either but I think the demand from that industry would be higher (especially from oversea markets such as Asia and Europe) than cruise after this mess is over.

This is not just about Norwegian but other cruise companies (Carnival is included) too -

Worse still, even when these restrictions are lifted, many people may choose to forego cruise ship travel due to fears of getting sick. Thus, despite their recent -- and potentially future -- capital raises, Norwegian, Royal Caribbean, and Carnival are likely to remain in a battle for survival. Unless a vaccine or effective treatment for COVID-19 is developed soon, bankruptcy could be an unfortunate possibility for one or more of the major cruise ship operators.

Why Carnival, Royal Caribbean, and Norwegian Cruise Line Stocks Plunged Today | The Motley Fool

One of the major cruise ship companies warned investors it may go bankrupt.

www.fool.com

And this-

Back in March -- when there was still hope that the sailing disruption would last weeks instead of months -- only 45% of Carnival's passengers were going for the sweetened cruise credit. More than half of the displaced customers calling in were opting to get their money back

If Norwegian Cruise Line Goes Down, Carnival and Royal Caribbean Will Pay the Price | The Motley Fool

Liquidity concerns at the third-largest cruise line could hurt more than help the situation for its two larger rivals.

www.fool.com

 

[dasherHampton]

Why in the hell are you guys messing around with stuff like cruise lines?

 

[JEDI]

and im in sqqq @ 11. rolling the dice...
lets see if tomorrow's monthly unemployment #s for April will start the retest of recent low.

 

[JEDI]

Why in the hell are you guys messing around with stuff like cruise lines?

ncl has no ships sailing, unknown when ships will start sailing, a ton of debt, and stock dilution.
yet their stock is up 8% today.

 

[Charmonium]

I am only buying cruise lines when cheap because it will take a while for any of them to be 5-baggers.

I get the feeling that you have very expansive view of what constitutes "a while." hehe

 

[JEDI]

and im in sqqq @ 11. rolling the dice...
lets see if tomorrow's monthly unemployment #s for April will start the retest of recent low.

sqqq dropping after hours 1%.. sigh

 

[FelixDeCat]

With 33 million people unemployed in this country, why is stock market headed back to all time highs? We are at depression level unemployment.

Why buy even one stock in the stock market?

Millions are raiding food pantries and sitting on their asses at home doing nothing.

From cruise lines to battery operated car companies to a company that sells a declining number of $2,000 cell phones. Even oil companies have rallied hundreds of percent in some cases when a record oil glut still exists.

There is definitely something wrong but nobody knows with what.

But you can bet stocks will go up tomorrow no matter what you think or want.

 

[KB]

Why in the hell are you guys messing around with stuff like cruise lines?

Its all about risk/reward. Cruise lines have historically done well, yet have been beaten up really bad in this crises.

If you have a 50/50 chance of CCL going bankrupt/recovering then you have a 50/50 chance of losing 100% or gaining 200% - 500%. Those odds are in your favor. If a casino gave you those odds I would play all day.
Now if you believe its 90/10 of bankruptcy/recovering, those odds are not in your favor.


Plus buying the QQQ, which is up for the year, doesn't provide enough reward when everything else has been beaten down.

 

[dullard]

With 33 million people unemployed in this country, why is stock market headed back to all time highs? We are at depression level unemployment.

Why buy even one stock in the stock market?

You are correct that the economy is one important aspect in the value of stocks. But it isn't the only aspect. The issue that is MORE important than unemployment and the GDP is: where else should the money go? Even though paper wealth did decline significantly, the world's governments are also rapidly ramping up paper wealth with stimulus after stimulus. This wealth has to go somewhere. So, if you had control of the world's $360 trillion of wealth where would you put it?

Real Estate and Land? Few people are paying rent and mortgages. Companies are not paying their leases. Farmers are doing terribly and farmland prices may decline. REITs are doing terribly.

Bonds, mortgages, etc? Do you really want to lend out money to governments right now? Their debt is skyrocketing. Consumers aren't paying back their mortgages either.

Cash equivalents? Interest rates are zero, or below zero. And at some point inflation could kick in leaving you with potentially massively negative returns.

Foreign stocks? Nope, their unemployment situation is just as bad.

Gold/Silver? These actually do terribly when there is a real crisis. They do very well when there is an IMPRESSION of an impending crisis, but we are past that impression stage. Ultimately, when the actual crisis hits, people and governments sell gold to pay their debts. In the end, they have no real return (no dividends, no income generation, etc). The only way to gain with metals is to find a bigger sucker.

Art? Really? $360 trillion in art?

Oil? I think you missed the boat (tanker) on that. Oil isn't going to do well until the economy comes back. And by then stocks will be coming back too.

Ultimately, this $360T has to go somewhere and even though the US unemployment looks terrible, the US stock market is probably about the best of the terrible options. Economies bounce back. They always have. While the US stock market is quite risky now, when the economy bounces back, I'll be happy to own more of it. I bought two large lump sums of stocks so far (one on March 12 and one on March 23). I'm happy with my choice, even if the stock market does crash again (it likely will). And if it crashes again, I'll be back buying more.

 

[ultimatebob]

You are correct that the economy is one important aspect in the value of stocks. But it isn't the only aspect. The issue that is MORE important than unemployment and the GDP is: where else should the money go? Even though paper wealth did decline significantly, the world's governments are also rapidly ramping up paper wealth with stimulus after stimulus. This wealth has to go somewhere. So, if you had control of the world's $360 trillion of wealth where would you put it?

If you're a 1%er, you can always invest in rare automobiles. Something like a vintage Ferrari tends to hold it's value well, even during a recession.

 

[JEDI]

But you can bet stocks will go up tomorrow no matter what you think or want.

and you are right, much to the anguish of my sqqq.

but how did you know that the market will go up despite the huge April unemployment #s?

 

[dasherHampton]

and you are right, much to the anguish of my sqqq.

but how did you know that the market will go up despite the huge April unemployment #s?

My guess is twofold:

1) Indicators show the economy has likely bottomed out.

2) At least 80% of the job losses are temporary.

 

[snoopy7548]

If you're a 1%er, you can always invest in rare automobiles. Something like a vintage Ferrari tends to hold it's value well, even during a recession.

I prefer to invest in pinball machines, thank you very much!

 

[ultimatebob]

I prefer to invest in pinball machines, thank you very much!

Hey... You do You, but classic automobiles are actually going up in value. If you someone have something like a mint condition Dodge Challenger from the late 60's with a Hemi, it probably appreciated more in value than most automotive stocks did over the last 50 years.

 

[FelixDeCat]

and you are right, much to the anguish of my sqqq.

but how did you know that the market will go up despite the huge April unemployment #s?

I was just being real. The market only goes up these days because it is unhinged from reality. It no longer reacts to good news. The market itself is a momentum stock, and nobody but the "little people" give a damn how pricey it gets.

India nukes Pakistan? Buy.

Large comet headed towards London? Buy.

25% unemployment? Buy.

Nobody making rent, supply chains disrupted, people resorting to theft to make a living? Buy.

Fed raising interest rates back up to a measly 2%? ITS THE END OF THE GOSH DAMN WORLD! MARKET PANIC! 60% DECLINE IN STOCKS! SELLLL!



I bought 6 QQQ 221.50 puts for $2 just for shits and giggles for next week.

 

[JEDI]

I bought 6 QQQ 221.50 puts for $2 just for shits and giggles for next week.

$1200 bet for shits and giggles?
ATOT $ represent!

 

[zinfamous]

People sitting at home, why not waste $50 on booze and videogames?

....because 20% of them don't have jobs anymore?

Oh right, you don't know actual people.

 

[FelixDeCat]

$1200 bet for shits and giggles?
ATOT $ represent!

I've heard a lot of professional traders on CNBC say they are shorting the VIX. The bot algos are keyed to several things - some of the biggest are interest rates and the VIX. If rates or the VIX go up, the market goes down. The current VIX number as of Friday is 27.98. See a pattern here?:







Being that the VIX is 27.98 and the historical typical range is 10-20, MY THEORY is that they are trying to short it back to that range.

They figure they can do this with impunity despite a bad economy because rates are very low, the government is talking MORE stimulus (we dont need it, we've spent too much already) and the Fed is manipulating the credit markets at every possible angle and will not allow "price discovery", so the only direction for markets to go is UP!?

The only risks right now are Trump possibly announcing measures against China next week, politicians throwing monkey wrenches in the next stimulus package or something unknown / something considered irrelevant suddenly becoming relevant.

So either we see QQQ $213 or QQQ $231 next week, with 231 being the favorite.

 

[s0me0nesmind1]

....because 20% of them don't have jobs anymore?

Oh right, you don't know actual people.

Lol you think not having a job means Americans don't spend money?

Have you seen an alcoholic or videogame addict?

 

[IEC]

 

[FelixDeCat]

Musk threatens to exit California over virus restrictions

Ruh-Roh - Musk threatens to pull out of California

On Twitter, Musk also threatened to sue over Alameda County Health Department coronavirus restrictions that have stopped Tesla from restarting production its factory in Fremont south of San Francisco.

“Frankly, this is the final straw,” he tweeted. “Tesla will now move its HQ and future programs to Texas/Nevada immediately.”

 

[dasherHampton]

I got my statements this week. Had the courage to open them this time.

God, I have this urge to push in a bunch more money on SRNE. Every bone in my body tells me it's going to push higher.

Can you stop me Felix? Do that logic thing that you do.