A quick poll on whether freetraders think we’ll enter a depression (let’s say a decline in GDP of 10%), or how long the global economy will take to bounce back in a sustainable way.
0 voters
The global output (gdp) is still projected to grow this year, albeit by only 0.X percent.
So given that we are not even in a recession yet, that seems very unlikely. All capital stock is there already, it’s an endogenous crisis.
Did you mean exogenous (external to economies, will go away quickly)? I’m not sure the shutdowns have really been reflected in economic figures yet and forecasts are notoriously unreliable.
Definitely feels like we got some more to go to the bottom.
On a positive note though:
China getting back to work and FedEx there reports some anecdotal stats:
-Demand rebounded more than expected
-65-70% of small business operating again
-90-95% of large manufacturers operating
China is giving me hope right now this will be relatively short-term, let’s hope so.
China is also spreading tons of misinformation, so take whatever comes out of there with a pinch of salt.
Nope, the opposite. There’s no external shock. The shock is that we choose to not go to work and stay in. The virus itself doesnt do anything yo the economy. It’s our reaction that crashed it. It’s essentially a trade off between more deaths and the economy. We choose to deprive the economy to save a couple of thousand of people.
Here are the Hedgeye risk ranges for the immediate term, gives an indication where they think the major indices will be:
UST 10yr Yield 0.56-1.11% (bearish)
SPX 2283-2686 (bearish)
RUT 972-1265 (bearish)
NASDAQ 6723-7801 (bearish)
Utilities (XLU) 49.14-59.90 (bearish)
REITS (VNQ) 63.43-79.81 (bearish)
Consumer Staples (XLP) 49.50-58.07 (bearish)
Tech (XLK) 70.02-84.03 (bearish)
Shanghai Comp 2740-2959 (bearish)
Nikkei 16542-19361 (bearish)
DAX 8130-10007 (bearish)
VIX 39.13-86.04 (bullish)
USD 95.25-99.43 (bullish)
Oil (WTI) 23.43-34.04 (bearish)
Nat Gas 1.61-1.95 (bearish)
Gold 1471-1602 (bearish)
Copper 2.31-2.48 (bearish)
Just talked to a friend who put it the way I see it in a way I couldn’t have done better. Quote:
“…it’s blown well out of proportion…”
Until it’s one of your loved ones that died.
Most things are blown out of proportion, until it hits home. That’s human nature.
People react to things in different ways. I look at the stats and see relatively low mortality rates, my wife looks at our kids and has a mental breakdown out of fear something happens to them.
Statistically speaking, 6k people died so far. 6k people die globally due to lightning. Doesn’t stop anyone from going out in the rain, although people know not to use an umbrella in a thunder storm.
People should take sensible precautions and I do agree fear has gone irrational. However, that’s the society we live in these days. People claim to be adults, yet when something unknown happens they expect the government to magically solve it all, with zero pain and at zero cost to people themselves. Obviously, governments can’t do that but they will be held accountable, rightly or wrongly, for every single death so they go overboard in reactions.
It’s the same with stock markets. They go up and down, yet many stupidly put in their life savings and are now expecting governments to pump in trillions to protect them from their own stupidity.
If people stop acting like children, they stop being treated like children I’d say.
Just about it
This is the sort of global issue that could put off a generation from investing.
This is what’s really sad. Crisis events like this are where future fortunes are made.
I’m still buying long and it’s all going into my next house purchase 
I’m there every day… markets arent too great either 
Interesting results.
Like most people (> 50% so far), I voted for recession rather than depression, after that 27% think 6 months impact, then 20% depression. If this poll had been taken a few weeks ago, I think most would have said it’ll pass in a couple of months.
It will be interesting to see where opinions are in a month or two.
