stock market was up today...

#10,326
#10,326
JFreak said:
But how long do restaurants remain reduced capacity? 1-2 months? And I have yet to hear of any going 25% capacity.. most are 50%.
Click to expand...
Does it really matter? Most of these restaurants have spent the better part of 2 months on lockdown already. Opening up at 25-50% may as well be 0%. The profit margins in restaurants are so small... they have to be full and have a lot of table flipped over in order to make it.
 
  • Like
Reactions: MontyPython and NEO
#10,327
#10,327
Rasputin_Vol said:
Does it really matter? Most of these restaurants have spent the better part of 2 months on lockdown already. Opening up at 25-50% may as well be 0%. The profit margins in restaurants are so small... they have to be full and have a lot of table flipped over in order to make it.
Click to expand...
Huh? It absolutely does matter whether they remain reduced capacity for 1-2 months or 6.
 
#10,328
#10,328
JFreak said:
But how long do restaurants remain reduced capacity? 1-2 months? And I have yet to hear of any going 25% capacity.. most are 50%.
Click to expand...

Reduced capacity will likely stay until there's a vaccine.

FL and TX both 25%. GA 10 people per 500 sq ft.

Margins are already razor in this industry. Most will end up closing back up unless there's a change OR if they have access to outdoor seating... although, with take out... maybe they can squeak it out.
 
Last edited:
#10,329
#10,329
SpaceCoastVol said:
The losses are already baked in.

Trump will still get elected, Chump.
Click to expand...

No. I don't think so. The markets are expecting some semblance of normality. My posts are geared here towards making money, not politics. You know where I stand on that.
 
Last edited:
#10,330
#10,330
Rasputin_Vol said:
Now you are starting to turn the corner and realize that the stock market reflects nothing that is actually going on in the real economy. I've been saying this since 2012-2013.
Click to expand...

Well, then you missed out on th he longest economic expansion and bull market in US history. Now we visit the flip side.
 
#10,331
#10,331
Key points to consider.

It's a GLOBAL pandemic. The US is still has the greatest economy, financial system, military, consumerism, technology, healthcare, and agriculture in the world. By far.

China is the biggest threat to the US. They may not be able to lie, cheat, and steal their way out of the crap that they've done to the world.

Hopefully there will be a long term trend of moving manufacturing to freedom loving democracies and away from the communists and socialists.

Demographics are better in the US than most of the other top economies.

The US is a net exporter of agriculture and now energy. Energy independence shouldn't be an issue for a long time if working from home becomes the norm.
--------------------------------------------
I'm still pretty bullish on the QQQs. Not as much in the near term. Certainly am in the LT.
 
#10,332
#10,332
I usually go to restaurants about 6x every week. Dining rooms are still mostly empty. But every many are very busy with a steady flow of delivery drivers coming and going and some are doing a ton of curbside take out. Many have adapted and those that survive will see less competition as poor performers fail.
 
#10,334
#10,334
Rasputin_Vol said:
Now you are starting to turn the corner and realize that the stock market reflects nothing that is actually going on in the real economy. I've been saying this since 2012-2013.
Click to expand...
Josh Brown has a great analogy about the relationship between the economy and the stock market. Picture a person walking their dog across a park. He starts on one end of the park and crosses to the other in a straight line. His dog zigs and zags all over the place, running to his left and his right, up ahead of him and back behind him. Sometimes the dog is running, especially if he sees something that gets his attention, and sometimes he walks more slowly or stops to take a break. Both the dog and the person eventually end up at the same place. The economy is the person, the stock market (and financial markets generally) is the dog.

The Nasdaq and big tech is holding up well for logical reasons, even though I agree those names are overvalued at present and were overvalued before this drop. Slightly over one-third of the Nasdaq 100 is MSFT, AAPL, and AMZN because those companies are so massive. Neither of those companies, at least so far, has seen or is expecting to see massive earnings hits as a result of this. In fact AMZN is thriving, and the products that MSFT and AAPL make (cell phones and computer software, among other things) are basically seen as necessities today; they weren't 15 years ago, but are today. If you look at the names at the ground zero of the crisis (leisure, travel, hospitality) those stocks got destroyed then simply stopped going down - they never really bounced with the market and in some cases (like AAL today) they are making new lows.

Remember - stocks at the end of the day are a barometer of the earnings of the underlying companies...not GDP, the unemployment rate, wage growth, or anything else. Nothing more, nothing less.

You also have to keep in mind that in addition to being a measure of how well the economy is doing markets these days are also a measure of liquidity in the system, especially with interest rates as low as they are. There was a panicky event initially the caused a flight to cash, so everything sold off. The central bank stepped in, panic has apparently eased for a time, and folks have tentatively returned...that causes a bounce, and it shouldn't be surprising that as confidence returned money went into the names that were working pre-crisis (tech).
 
Last edited:
  • Like
Reactions: Velo Vol
#10,341
#10,341
85SugarVol said:
Fund manager who nailed recent bottom calls for ‘virus relief concerts’ where people intentionally get infected
Click to expand...
I agree:

“My ultimate goal is to get thought leaders and the rest of the country to start thinking about the choices we have to make, the risks that come with those choices, the uncertainty within each of the choices and the likely negative consequences,” he told MarketWatch. “Let’s be clear. There are currently no good choices in front of us — only better ones and worse ones for the country overall.”
Click to expand...
I don't follow the leap of that to virus concerts, though.
 
#10,342
#10,342
Rasputin_Vol said:
The fact that you still have a number of restaurants right now that are not opening at 50% or reduced capacity proves what I am saying.
Click to expand...
Depends on how much cash they have to ride it out. Which is largely dependent on if landlords renegotiated rent. Which most did. Those spaces are hard to rent. Currently the average casual dining restaurant is down about 45% vs prior year. Larger players it’s less then that. But if you can get rent pushed you can survive a lot longer. Tons of the smaller players got big bucks from PPP. They can ride this out for awhile.
 
#10,343
#10,343
volfanhill said:
Depends on how much cash they have to ride it out. Which is largely dependent on if landlords renegotiated rent. Which most did. Those spaces are hard to rent. Currently the average casual dining restaurant is down about 45% vs prior year. Larger players it’s less then that. But if you can get rent pushed you can survive a lot longer. Tons of the smaller players got big bucks from PPP. They can ride this out for awhile.
Click to expand...
PPP is basically a couple months of payroll.
 
#10,344
#10,344
Velo Vol said:
PPP is basically a couple months of payroll.
Click to expand...
$10 million capped with 75% having to go to payroll. They are getting quite creative to hit the mark and stay compliant. $2.5 million to do what you want with is more then enough to last the small players a long time.
 
#10,345
#10,345
volfanhill said:
$10 million capped with 75% having to go to payroll. They are getting quite creative to hit the mark and stay compliant. $2.5 million to do what you want with is more then enough to last the small players a long time.
Click to expand...
You're defining "small players" a lot differently than I am. Mom and pop.
 
#10,347
#10,347
volfanhill said:
Probably so. But I got guy on my street who owns six bars here in the Atlanta area. PPP saved his ass. Says he will be fine. Now single unit owners are probably screwed.
Click to expand...
Seems the helpfulness of PPP largely depends on how much payroll is versus other fixed costs, regardless of business size.
 
#10,349
#10,349
Vol737 said:
A little more pressure on China, in a sense. Used to hold Baba and eventually sold it off. Nice enough gain, but I really have no interest in investing in China anymore.

Bill that could delist Chinese companies from U.S. stock exchanges to see ‘swift passage’ in House, analyst says
Click to expand...
Thanks for posting that. I didn't realize that Chinese companies weren't under the normal oversight required to be listed. It looks like French companies aren't either, but it's expected that they soon will be.

https://pcaobus.org/International

PCAOB_Oversight.png
 
#10,350
#10,350
05_never_again said:
Josh Brown has a great analogy about the relationship between the economy and the stock market. Picture a person walking their dog across a park. He starts on one end of the park and crosses to the other in a straight line. His dog zigs and zags all over the place, running to his left and his right, up ahead of him and back behind him. Sometimes the dog is running, especially if he sees something that gets his attention, and sometimes he walks more slowly or stops to take a break. Both the dog and the person eventually end up at the same place. The economy is the person, the stock market (and financial markets generally) is the dog.

The Nasdaq and big tech is holding up well for logical reasons, even though I agree those names are overvalued at present and were overvalued before this drop. Slightly over one-third of the Nasdaq 100 is MSFT, AAPL, and AMZN because those companies are so massive. Neither of those companies, at least so far, has seen or is expecting to see massive earnings hits as a result of this. In fact AMZN is thriving, and the products that MSFT and AAPL make (cell phones and computer software, among other things) are basically seen as necessities today; they weren't 15 years ago, but are today. If you look at the names at the ground zero of the crisis (leisure, travel, hospitality) those stocks got destroyed then simply stopped going down - they never really bounced with the market and in some cases (like AAL today) they are making new lows.

Remember - stocks at the end of the day are a barometer of the earnings of the underlying companies...not GDP, the unemployment rate, wage growth, or anything else. Nothing more, nothing less.

You also have to keep in mind that in addition to being a measure of how well the economy is doing markets these days are also a measure of liquidity in the system, especially with interest rates as low as they are. There was a panicky event initially the caused a flight to cash, so everything sold off. The central bank stepped in, panic has apparently eased for a time, and folks have tentatively returned...that causes a bounce, and it shouldn't be surprising that as confidence returned money went into the names that were working pre-crisis (tech).
Click to expand...
That is some high powered reefer Josh Brown is smoking, because there is no way in hell that a country with 30% unemployment and over 30 million unemployed should have a stock market in the midst of a bull run.

There is no connection (or in his example a leash) between the economy and the stock market anymore. That analogy may have been true in the past, but nowhere near true since 2008.
 
New posts
You must log in or register to reply here.

VN Store



Back
Top