Author Topic: The day after tomorrow  (Read 18309 times)

Spekulatius

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Re: The day after tomorrow
« Reply #60 on: March 28, 2020, 01:55:19 PM »
Yeah, lots to quibble with.

Shouldn't expect labor scarcity since the demographic at risk is largely out of the workforce.

And a shift to greater precautionary savings? Many more examples of the market having a short memory.

Some mostly unrelated thought what might happen:

1) There will be an onslaught of lawsuits. Covid-19 infection at work - lawsuit. Restaurant (preferably a deep pocketed chain) has a Covid-19 infected worker who may infect people - lawsuit. US sues China?

2) Cheesecake Factory told landlords they that donít pay rent in April. Itís not that they canít pay, they just decided not too. Evict us, if you donít like it. unlikely that they will remain the only one. Just not paying your bill might become a national sport? Calvinball time?

3) Bankruptcy courts may get clogged up for a long time from the volume of cases. What happens if you declare bankruptcy and canít get  court date? Ií have no idea.

4) UKís credit rating just got downgraded from AA to AA-. What about hard hit countries like Italy or Spain? This is probably causing another debt crisis in Europe and elsewhere.
Is the US safe?

5) Even with the aid packet, I donít think the airlines will last a long time - they will run out of cash in a couple of month, due to operating leverage. how can they restart national flights with hotspots all over the place. NY and NJ quarantined? other hotspots will flare up? International flights are even worse.

6) Even if you open up restaurants and small service business open up, will customer come back? What is safe, how can we tell? This is our first recession that is led by the service industry, which employs way more people than manufacturing or any other sector

7) President talk a out quarantining NY and NJ, what are the consequence of this. Are other states going to be closing borders too? I donít think this was ever done before - US becoming more like the EU?
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Castanza

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Re: The day after tomorrow
« Reply #61 on: March 28, 2020, 02:18:50 PM »
Yeah, lots to quibble with.

Shouldn't expect labor scarcity since the demographic at risk is largely out of the workforce.

And a shift to greater precautionary savings? Many more examples of the market having a short memory.

Some mostly unrelated thought what might happen:

1) There will be an onslaught of lawsuits. Covid-19 infection at work - lawsuit. Restaurant (preferably a deep pocketed chain) has a Covid-19 infected worker who may infect people - lawsuit. US sues China?

2) Cheesecake Factory told landlords they that donít pay rent in April. Itís not that they canít pay, they just decided not too. Evict us, if you donít like it. unlikely that they will remain the only one. Just not paying your bill might become a national sport? Calvinball time?

3) Bankruptcy courts may get clogged up for a long time from the volume of cases. What happens if you declare bankruptcy and canít get  court date? Ií have no idea.

4) UKís credit rating just got downgraded from AA to AA-. What about hard hit countries like Italy or Spain? This is probably causing another debt crisis in Europe and elsewhere.
Is the US safe?

5) Even with the aid packet, I donít think the airlines will last a long time - they will run out of cash in a couple of month, due to operating leverage. how can they restart national flights with hotspots all over the place. NY and NJ quarantined? other hotspots will flare up? International flights are even worse.

6) Even if you open up restaurants and small service business open up, will customer come back? What is safe, how can we tell? This is our first recession that is led by the service industry, which employs way more people than manufacturing or any other sector

7) President talk a out quarantining NY and NJ, what are the consequence of this. Are other states going to be closing borders too? I donít think this was ever done before - US becoming more like the EU?

Less than an hour after the stimulus bill was signed UAL said they wonít be able to pay workers past September....Simply amazing. This type of talk is coming from anyone and everyone big and small business. Just last night there was a lady who called in to the Joe Biden townhall and said she and her husband owned 3 bars and a spa in NYC. They needed cash to stay afloat. The kicker is she threw out the sympathy card that she was pregnant and quickly followed up with ďwe donít believe in loans, we believe in grants.Ē Most other callers said the same thing.

Point being, this could be interesting moving forward in terms of which group will be receiving more money and in which form.

Viking

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Re: The day after tomorrow
« Reply #62 on: March 28, 2020, 02:26:25 PM »
Yeah, lots to quibble with.

Shouldn't expect labor scarcity since the demographic at risk is largely out of the workforce.

And a shift to greater precautionary savings? Many more examples of the market having a short memory.

Some mostly unrelated thought what might happen:

1) There will be an onslaught of lawsuits. Covid-19 infection at work - lawsuit. Restaurant (preferably a deep pocketed chain) has a Covid-19 infected worker who may infect people - lawsuit. US sues China?

2) Cheesecake Factory told landlords they that donít pay rent in April. Itís not that they canít pay, they just decided not too. Evict us, if you donít like it. unlikely that they will remain the only one. Just not paying your bill might become a national sport? Calvinball time?

3) Bankruptcy courts may get clogged up for a long time from the volume of cases. What happens if you declare bankruptcy and canít get  court date? Ií have no idea.

4) UKís credit rating just got downgraded from AA to AA-. What about hard hit countries like Italy or Spain? This is probably causing another debt crisis in Europe and elsewhere.
Is the US safe?

5) Even with the aid packet, I donít think the airlines will last a long time - they will run out of cash in a couple of month, due to operating leverage. how can they restart national flights with hotspots all over the place. NY and NJ quarantined? other hotspots will flare up? International flights are even worse.

6) Even if you open up restaurants and small service business open up, will customer come back? What is safe, how can we tell? This is our first recession that is led by the service industry, which employs way more people than manufacturing or any other sector

7) President talk a out quarantining NY and NJ, what are the consequence of this. Are other states going to be closing borders too? I donít think this was ever done before - US becoming more like the EU?

Less than an hour after the stimulus bill was signed UAL said they wonít be able to pay workers past September....Simply amazing. This type of talk is coming from anyone and everyone big and small business. Just last night there was a lady who called in to the Joe Biden townhall and said she and her husband owned 3 bars and a spa in NYC. They needed cash to stay afloat. The kicker is she threw out the sympathy card that she was pregnant and quickly followed up with ďwe donít believe in loans, we believe in grants.Ē Most other callers said the same thing.

Point being, this could be interesting moving forward in terms of which group will be receiving more money and in which form.

I start to get a few flickers of optimism and then i read this :-) We really are in uncharted waters. The next couple of months could make for some great reality TV.

Spekulatius

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Re: The day after tomorrow
« Reply #63 on: March 28, 2020, 03:32:08 PM »
Yeah, it seems that defaults become a sport or go viral so to speak. I am not sure what rabbit holes this leads us to, but it is certainly not bullish for banks.

The above are just things that I started to notice. Maybe itís something, maybe itís nothing. Most will play out over the long run. Near term, the Potus talk about quarantining NY makes it almost inevitable to do it, unless he walks this back immediately. That would be interesting.
Life is too short for cheap beer and wine.

SharperDingaan

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Re: The day after tomorrow
« Reply #64 on: March 28, 2020, 03:58:04 PM »
" 6) Even if you open up restaurants and small service business open up, will customer come back? What is safe, how can we tell? This is our first recession that is led by the service industry, which employs way more people than manufacturing or any other sector"

It's not just the customers, it's also finding the additional service staff, and the re-start losses that those businesses will incur.
Everyone re-starting at once means pay up, or go without. Business is great for 2-weeks, and dies back 50% after the party.
Then ... another Covid-19 contraction shows up.

SD

Castanza

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Re: The day after tomorrow
« Reply #65 on: March 28, 2020, 04:05:14 PM »
" 6) Even if you open up restaurants and small service business open up, will customer come back? What is safe, how can we tell? This is our first recession that is led by the service industry, which employs way more people than manufacturing or any other sector"

It's not just the customers, it's also finding the additional service staff, and the re-start losses that those businesses will incur.
Everyone re-starting at once means pay up, or go without. Business is great for 2-weeks, and dies back 50% after the party.
Then ... another Covid-19 contraction shows up.

SD

Could be supplier issues on the backend as well. Just because a restaurant is ready to open doesnít mean their special flour supplier will be up and running. Breweries could have issues with hops and other perishable supplies or possibly oversupply of beer and no bottle to put it in. Just a guess, but there will probably be 2nd and 3rd order supply chain issues at least for some amount of time.

Spekulatius

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Re: The day after tomorrow
« Reply #66 on: March 28, 2020, 05:54:22 PM »
Pretty good recording from Focused compound about economic expectations and impairments. In short, he beleived a 30% haircut for banks is justified for example. This one can also listened to as a podcast.
https://youtu.be/vytay56stf0
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Kaegi2011

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Re: The day after tomorrow
« Reply #67 on: March 29, 2020, 07:14:39 PM »
" 6) Even if you open up restaurants and small service business open up, will customer come back? What is safe, how can we tell? This is our first recession that is led by the service industry, which employs way more people than manufacturing or any other sector"

It's not just the customers, it's also finding the additional service staff, and the re-start losses that those businesses will incur.
Everyone re-starting at once means pay up, or go without. Business is great for 2-weeks, and dies back 50% after the party.
Then ... another Covid-19 contraction shows up.

SD

I think this is exactly right.  Outside of a very assured restart in terms of the virus having no more impact, small business owners will be reluctant to restart / hire and go back to 100% prior to crisis.  I know most of people I know would not risk it if they think the risk is diminished but not gone as a consumer.  Also, while the past 2-3 weeks most restaurants were open for delivery / take out, a lot of them are starting to shut down due to risk to their workers / themselves. 

Gamecock-YT

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Re: The day after tomorrow
« Reply #68 on: March 29, 2020, 07:52:00 PM »
" 6) Even if you open up restaurants and small service business open up, will customer come back? What is safe, how can we tell? This is our first recession that is led by the service industry, which employs way more people than manufacturing or any other sector"

It's not just the customers, it's also finding the additional service staff, and the re-start losses that those businesses will incur.
Everyone re-starting at once means pay up, or go without. Business is great for 2-weeks, and dies back 50% after the party.
Then ... another Covid-19 contraction shows up.

SD

I think this is exactly right.  Outside of a very assured restart in terms of the virus having no more impact, small business owners will be reluctant to restart / hire and go back to 100% prior to crisis.  I know most of people I know would not risk it if they think the risk is diminished but not gone as a consumer.  Also, while the past 2-3 weeks most restaurants were open for delivery / take out, a lot of them are starting to shut down due to risk to their workers / themselves.

Not to mention, they'll probably be regulated to 25 or 50% normal capacity to start. China has had issues getting people to come back to restaurants.

https://www.eater.com/2020/3/24/21191278/china-beijing-coronavirus-future-of-restaurants

james22

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Re: The day after tomorrow
« Reply #69 on: March 30, 2020, 12:44:46 AM »
US sues China?

A bipartisan effort is underway outside of Congress to hold China accountable for what could be trillions of dollars worth of damage caused by their mishandling of the global coronavirus pandemic.

The Berman Law Group, a Miami-based law firm advised by the younger brother of former Vice President Joe Biden, filed a class-action lawsuit against the government of China on March 13.

On Monday, Berman partnered with a lobbying and public affairs firm that has deep connections to President Donald Trump in a move to forge a unified response against Chinaís government.

ďWe believe that this is not a Democratic issue or a Republican issue. This is an American issue,Ē Berman senior litigation strategist Jeremy Alters told the Daily Caller News Foundation.


https://dailycaller.com/2020/03/24/china-coronavirus-class-action-lawsuit/
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