Rolling US Economy Into The Shitbin Thread

I want an account at Schwab for their no fee international atm card.

a good friend of mine has this and likes it ... she travels a lot for work.

This may be a small point but, this would be a good time to re-evaluate the TCJA legislation, and consider reverting back to some of the previous tax code, such as allowing the deduction for unreimbursed employee business expenses -- such as the office in home.

xpost yeah and unless they have changed a lot in the last couple of years, people at schwab are generally really helpful and their client statements and technology are better than most.

I have had my schwab account for like 20 years? ... their interface re: researching can be a little awkward, but it is pretty solid.

bailouts for every industry are good and necessary. also need to make bail outs conditional on not firing anyone

Lol yea that'll happen

i understand that this thread is mostly for blowing off steam and exchange trenchant one-liners. that’s ok; it’s much more important that people understand the public health than the economics.

the fiscal response by republican congress will be infuriating, insufficient and inequitable. it’s good to be mad about that. im very mad about it and scared for friends and family in the US.

however, right now fiscal policy is needed in a huge way just about everywhere in the world at all levels. we need it to keep money flowing while all non-essential activity shuts down. it will not come in the perfect policy package, but in some imperfect shitty way, but it will still help

flopson otm

Insane to see the central bank geniuses pull their magic lever and the lever just breaks off in their hands. Whatcha gonna do now geniuses??

good thread

Something I want to address:

Lots of people are calling for direct $ transfers to households. $1000/per person, $5000/house etc.

And I've seen some people say things in response, well like "If we can give people $1,000, why not just give them $100,000 and we'd all be rich." /1

— Joe Weisenthal (@TheStalwart) March 15, 2020

Or: we don't need cash (only), we need to call a kind of moratorium on bills and mortgages, which is kind of what's going on in France I think?

why not just give them $100,000 and we'd all be rich.

Am I supposed to read past that?

Obv making everybody rich wouldn't work but even giving people 1k month might not stem the tide enough.

There are something like 85 million jobs considered at risk right now. Obviously they won't ALL disappear but for some people, 1k, even per adult, might help with a rent payment but still leave them delinquent elsewhere. And then there's next month.

I have about six months of bills saved. If I get laid off tomorrow, I'll survive because i will get severance. But there are plenty of people who might keep their job through the storm and have it eliminated in the aftermath and be almost broke. And enhanced unemployment or not, they may find themselves like many families did during the Great Recession, families of 8 piling into a four person home, etc.

Obviously the bailout had to happen in 2008 and the stimulus in 09, and probably here, but... I'm legitimately freaked at the inadequacy of the bill rendering many people homeless.

At least during the Great Recession, they could go outside and earn money creatively. If bailouts can be conditional on maintaining staff, great, but if not... anybody who loses their job now won't be able to get another anytime soon. And unemployment may be brutally insufficient.

I know that's what Congress is working on now but it's not snark that I say I'm afraid of friends and family having lives ruined. And mine eventually being ruined if/when my savings deplete.

Tracer otm re: suspensions of bills helping in addendum to cash.

We can't expect landlords to do it out of the goodness of their heart, it has to be legislated. But it's tough with landlords because they don't all have deep pockets

where possible, moratorium on bills is helpful

however, there’s an asymmetry in cash vs moratorium on bills that makes cash favourable:

all bills can be paid in cash, not everyones faces all kinds of bills. also, the people who receive bills also have to pay bills

say you ban rent bills but not mortgages, and your landlord relies on rent bills to pay their mortgage and they default

say you ban rent and mortgage bills but not health insurance or college loan bills. if you don’t give cash, people with health or education debt are worse off

the asymmetry also creates equity issues: people with largest rent and largest mortgages benefit the most from a moratorium. these people are richer, on average

legally it seems challenging to create a comprehensive moratorium on many different sorts of bills. there are some challenges to giving out cash, but far fewer imho

unless you can suspend *every single type of bill*, cash is preferable

Yeah freezing circulation is stupid

1935:

Federal Reserve chairman Marriner Eccles: Under present circumstances, there is very little, if any, that can be done.
Congressman T. Alan Goldsborough: You mean you cannot push on a string.
Governor Eccles: That is a very good way to put it, one cannot push on a string. We are in the depths of a depression and... beyond creating an easy money situation through reduction of discount rates, there is very little, if anything, that the reserve organization can do to bring about recovery.

One the little understood facets of the recent sharp drops in stock prices is that for every single one of those transactions for the past two weeks, there was a buyer involved.

and just a hint of nutmeg

literally just saw someone argue that now is too soon for economic stimulus, that we need to wait until we're on the other side of this, that we just need "people to participate in the economy".

gee wonder why they're not participating right now.

Apparently according to the government I am an essential business! ... About half my friends are on lockdown / shelter in place because they are considered non-essential

Yerac should be v upset about blue apron's stock rn

no i got a small amount yesterday. I was trying to get more before they halted.

I kind of understand their business model and customer base more now! so terrible.

Holy shit, if they bailout casinos ...

they should bail me out for the money I lost betting on sports last year

the one-two punch of Dougie Jones and a pandemic

The biggest U.S. airlines spent 96% of free cash flow over the last decade to buy back shares of their own stock in order to boost executive bonuses and please wealthy investors.

Now, they expect taxpayers to bail them out to the tune of $50 billion. It's the same old story.

— Robert Reich (@RBReich) March 17, 2020

Fuck a airline

^^^ yeah this. Personal responsibility does not apply to corporate businesses. I really hate the completely ridiculous excuse "fiduciary duty to our shareholders."

one secret about nearly every publicly traded company that is totally disgusting (click here)

privatize profits and socialize the losses, rinse and repeat, being sure to never elect someone who might actually change something

Heather Cox Richardson did a nice summary of it. From her daily posting:

...The administration’s response to this crisis reveals its priorities: use the federal government to protect business, not people. That reflects a certain ideology, one that says economic growth comes from the top, as a small group of elites runs the economy, using their money, knowledge, and connections to organize the rest of us into an efficient means of production. If that’s the case, government’s job is to protect property and the businesses that enable property to accumulate.

That ideology stands in contrast to a different one that says economic growth comes from the bottom. If the government simply protects equal access to resources and education, and guarantees equality before the law, those with good ideas and the capacity for hard work from all walks of life will innovate and drive the economy forward.

the market skyrockets today on news of...uh,

um

https://i.imgur.com/HNfXfZp.png

this is why i'm hesitant to think that italy is approaching any sort of peak for new cases. their growth rate is in the same range as many other countries right now.

(a growth rate of 28% per day will double the cases every 3rd day. a growth rate of 42% per day will double the cases every 2nd day)

(((((of course, lack of testing availability damages the integrity of this kind of analysis, but it's the best thing we have at the moment, i think)))))

OOPS! WRONG THREAD

still applicable!

lol, true!

...and so in conclusion, i must recommend not buying italy stock right now

the market skyrockets today on news of...uh,

um

wasn't there an announcement recently of another $500,000,000,000 getting pumped into the banks

or i suppose there's also the $850B legislation deal currently being watered down by republicans negotiated

but in general, it's just like...much of the economy is going to be shut down for the next month, minimum, and it's hard to believe it won't be longer than that.

like this, look at this image from the report that was so scary it actually seems to have affected trump and made him realize he had a bigger problem than he thought:

https://cdn.talkingpointsmemo.com/wp-content/uploads/2020/03/Screen-Shot-2020-03-17-at-9.49.26-AM-804x478.png

that's the worst case scenario - unmitigated - leading to 2.2M deaths in the US, or 510K in GB. but remember, worst case also means "quickest" - it means we reach the peak more quickly, overwhelming the hospitals, etc etc. and even in that scenario, the peak in the US is sometime in June.

obviously we will try to do something to mitigate, which means that curve will be flatter (a good thing) but also longer in duration.

it's just hard to look at all that and think it's a good opportunity to buy low right now. if anything it seems like there's more tanking to come.

but what do i know? i'm no jim cramer

sorry, here's a link to the Imperial College report i was referring to above:

https://drive.google.com/file/d/1eI26PNh5h_kHwB9msK2uIma42YOsRH4b/view

Well, if someone is personally trading (not investing for a retirement) you need a plan. You could very well buy XXX company and wait to get 10-15 whatever% realized gains and get out and will likely get it at some point because of the volatility. Or you could really love company YYY and you can buy 1/3 of the total amount you want now, wait and see where the market goes. Buy another 1/3 if the company goes down further (whatever percentage you want) to average down. And you know you won't sell it for X number of years so you are fine with the purchase in these times. Nothing is for certain.

yeah, that's true! i'm making the old mistake of treating the market as some sort of general indicator of the economy, or how investors think the economy is doing at the moment. but you're totally right, i'm sure a lot of the fluctuation is just people trying to make smart buying decisions. i believe bank of america sent out a note earlier today saying that it was a historic buying opportunity

it's not historic. It just hasn't happened in a while.

banks make money by churning fees. they need the activity.

bank of america sent out a note earlier today saying that it was a historic buying opportunity

I can see it now. Some altruistic bank exec was sitting in her office and thought, "how can I sit here, trying to do the bank's business, when all I can really think about is the possibility that our customers might not be awake to this historic buying opportunity in the stock market?" So she dashed off that email on her break time, then went right back to work with a smile on her lips and an easy conscience.

What is infuriating about all this is, no matter what measures are taken, no matter what is done, millions of people are looking at a reduced quality of life, more jobs, longer work hours, later retirement.

We act as if it's this uncontrollable thing, but the richest among us will still live comfortably and still have more money that they could spend in a lifetime. We'll have enough food that will still not make it to hungry families, housing or room for housing to be built, but these houses will sit unfilled and people will pack in overcrowded homes or become homeless.

All despite increasing automation and less need for manual labor. Our system of capitalism isn't compatible.

I'm moving to another country when things are contained. Who wants to split a villa?

I am always up for that. Twice I tried to get friends to go in on 2 different buildings in ny and live communally. It's hard to get people to commit to untraditional things or change.

I'm almost certain that the "joke" my mother used to make about living on the other side of a duplex with me is going to happen. It was impossible for years since they lived 900 miles away but at this point if I get them in something with reduced rent or don't charge them rent, Mom can cook for me and we're all happy.