/biz/ - Business & Finance

[Anonymous No.17850461]

If stock market is collapsing, why arent companies going bankrupt and people losing their jobs left and right like in 2008?

[Anonymous No.17850511]

>>17850461
Because the market was overpriced to begin with. This is the "great correction"

[Anonymous No.17850517]

Because this whole market is fake

[Anonymous No.17850622]

>>17850517
Truer words have never been spoken. The stock market, and by extension, pretty much the entire global economy, is a giant ponzi scheme. There is no other way that publicly traded stock could function.

[Anonymous No.17850640]

>>17850461
Because this crash has been going on for less than a mont you brainlet.
The 2008 crash went on for more than a year

[Anonymous No.17850641]

>>17850461
Takes longer before that happens, but bankruptcy and layoff will happen
Also this may be the market correction that some have predicted was coming soon
Corona only made it happen sooner and harder

[Anonymous No.17850845]

>>17850461
It’s been a couple days. Give it a minute.

[Anonymous No.17850927]

>>17850461
It's only the first couple days, give it a bit
It's going to be worse this time, given that the thing crashing the bubble is LITERALLY forcing people to stay away from their jobs

[Anonymous No.17851007]

>>17850461
You kidding?
Starbucks is shuttering non-drive thru locations. Thousands of restaurants are cutting servers and moving to take out only. Stadium jobs are suspended.

We've probably lost hundreds of thousands of jobs in the last three days. Probably a million or more by April.

[Anonymous No.17851028]

>>17850461
baby's first market cycle
these things play out over months, if not years

[Anonymous No.17851045]

>>17850461
Google golden parachute and layoff payback plans

[Anonymous No.17851117]

>>17850461

[Anonymous No.17851137]

>>17850461
This market is being fed by irrational emotion and not by any measurable bad business practices. People didn’t just stop drinking coke and the demand for Apple products has not decreased.

[Anonymous No.17851199]

>>17851137
You're an idiot full stop. Americans created a market where most people live paycheck to paycheck and then wonder why a machine running on fumes begins to lock up at any slow down or halt.

[Anonymous No.17851211]

>>17850517
surely there must be some companies with decent revenue compared to share price among the inflated filth

[Anonymous No.17851245]

>>17851211
Tesla

[Anonymous No.17851255]

>>17851007
This is not due to a decreased demand. Once the fear is over people will still want their seven dollar faggot chinos with free WiFi.

[Anonymous No.17851274]

>>17851137
So, business as usual? The same phenomenon put it all unsustainable highs.

[Anonymous No.17851295]

>>17851199
People live paycheck to paycheck and still buy iPhones. Let that sink in.

[Anonymous No.17851345]

>>17851255
See this guy's point
>>17851199

[Anonymous No.17851371]

>>17851274
Of course business as usual. Prohibition and the War on drugs didn’t stop the demand for the product.

[Anonymous No.17851378]

>>17850461
It will.
I’m firing all my employees this week.

[Anonymous No.17851415]

>>17850461
Interest rates are so low, companies can just borrow and continue to exist as zombie companies for years.

[Anonymous No.17851428]

>>17850461
if your company goes bankrupt after a month of low stocks, it was a joke of a company to begin with.

I swear, some of you say stuff that sound as if you really never had any interaction with the real world.

[Anonymous No.17851471]

>>17851295
Let this sink in. They straight up don't have the cash flow anymore.

[Anonymous No.17851507]

>>17850461
give it a few months, it takes a while to bleed to death

[Anonymous No.17851547]

>>17850461
>>17851117

[Anonymous No.17851562]

there is no mechanism for ensuring stock prices relate in any way to company success
with the exception of newly issued stock, the market has nothing to do with any sort of investment, and the vast majority of trading volume that takes place day to day is nothing more than speculative gambling to earn money for more speculation

[Anonymous No.17851570]

>>17851415
You need to find a bank to loan the money, though. A low fed rate isn't an automatic low interest rate from banks.

You can also be physically limited in getting an emergency loan just because there aren't enough loan officers to approve them all at once.

[Anonymous No.17851641]

>>17850461
All the big companies were bailed out these last few days. Trump created trillions to get his friends out of this pickle. He should be hanged.

[Anonymous No.17851755]

>>17850461
the market is a bubble

[Anonymous No.17851766]

>>17850461
The air does not instatenously exit the bubble, although this is kinda fast even for a bubble deflating.

It is 2008 over again, that recession never truly ended it was just buried under a mountain of printed fed "dollars".

[Anonymous No.17851804]

>>17850461
Bro these things take time. Companies will spend their saved up cash and THEN go bankrupt. Give it 6 months

[Anonymous No.17851827]

>>17850461
They will. You didn’t know yet last time.

[Anonymous No.17851842]

>>17851471
They never had cash flow. Look how much debt the average person holds.

[Anonymous No.17851881]

As soon as good news starts coming out of Italy everything starts going right back up.

[Anonymous No.17851920]

>>17851842
>debt hits a point where it's too unsustainable and not even a minimum interest rate can be paid back
Almost like a bubble bursting huh

[Anonymous No.17851946]

>>17851641
>just bail them out every time, bro.

Yes, continue distorting the economy, creating enormous bubbles until we're Soviet tier.

[Anonymous No.17852756]

>>17850461
It’s like someone dying of stage 4 cancer, even though it’s a certainty it doesn’t happen overnight. And there are days the person even feels kind of well. But he’s still got S4 cancer and there are no miracles.

I HATE this shit, I’m just graduating college (class of 2020 yay! yeah right) and I was planning a side business based on a small inheritance of items (roughly 7.5k pieces of old media)I was going to offload on eBay and other online platforms, strictly as a side hustle.

God damn fucking bat eating chinks!

[Anonymous No.17853144]

>>17852756
>pic
You know what?
Would.

[Anonymous No.17853232]

Give it a few months.

[Anonymous No.17853290]

>>17853144
you fucking degen

[Anonymous No.17853715]

>>17850461
The 2008 crash consisted of several straight months of falling stock prices. It took a while for the collapse of one bank to cause other banks to collapse, and then for every other bank to stop lending, and then for every other business to feel the impact.

[Anonymous No.17853736]

>>17852756
Remember, the Great Depression happened and some people came out on top.
Forbes in 2009 (lmao) posted some historical reading for inspiration
https://www.forbes.com/2009/04/30/1930s-innovation-America-business-1930s_land.html#58854dde3c22

If we are looking at a long term downturn with the virus rampaging for months, look at what consumers demand.

here's a hypothetical:
Tech illiterate people trapped in homes. Potential throttling of internet speeds. Right now companies are making goodwill gestures to keep internet affordable, but will that last if there is a credit crunch?

If you have media, see what you have extra copies of and stuff that isn't rare but still well loved. Naturally, hold onto truly rare media unless you can convince an old boomer that they should buy your rare edition of the White Album while the price is 'low'(read: still a high price because you know more than them) because "it's just like gold." If you know media well, make a small investment in DVD blanks and envelopes before things get shitty.

You could drive around blasting ice cream man music, delivering sterilized pirate DVDs to hermit boomers, and every once in a while getting lucky and finding a 'whale' who will sentimentally buy collectibles at an inflated price. What are they gonna do, hire an appraiser?

Just an example. Lots of other opportunities to be had for those willing to put in the work.

[Anonymous No.17853775]

>>17850461
Its still early; Wait a few months

[Anonymous No.17853806]

>>17850461
because fed is still desperately trying to unwind all the stock buybacks that got us in this situation

should they fail, we will see "too big to fail 2: electric boogaloo", and banks will get bailed out while the corporations that are too bogged down on leveraged buys of their own stock will suck dirt
only THEN will we see everyone laid off

so cross your fingers, i guess

[Anonymous No.17853859]

>>17850511
FPBP

[Anonymous No.17853891]

>>17853736
Omg 1000x gains. Happens every few days just grab a new shitcoin off of Bitcointalk.

[Anonymous No.17853905]

Boomer here. Should I withdraw my 401k? Thanks neet fren, I will give you some LINK

[Anonymous No.17853926]

>>17850461
IT TOOK SEVERAL MONTHS FOR THAT TO HAPPEN IN 2008 YOU STUPID ZOOMER

[Anonymous No.17853995]

>>17850641
This. Market correction was inevitable. Global pandemic influenced gridlock across all sectors... well doomsayers have been saying it was possible for decades.

[Anonymous No.17854039]

>>17853926
This, the 2008 financial crisis didn't start with Lehman brothers going under. It was already going to shit underneath the surface but when it happened it suddenly made everyone realize "OH FUCK IT'S HAPPENING RIGHT NOW." The same thing will happen here when they quarantine the US completely, hospitals are overwhelmed, and boomers are becoming worm food in high numbers.

[Anonymous No.17854061]

>>17850461
see you in 24 hours

[Anonymous No.17854088]

>>17850461
got an email this morning that they want to let go of my whole team

[Anonymous No.17854111]

>>17850461
With the exception of factory work, a lot of companies are having their employees work from home.

[Anonymous No.17854114]

>>17850511
explain this, please

[Anonymous No.17854121]

>>17851255
But businesses take months to hire, but hours to fire.

[Anonymous No.17854189]

>>17850461
this is how it reveals itself over time.
>https://www.reuters.com/article/us-health-coronavirus-france-renault/french-carmaker-renault-to-halt-production-in-france-idUSKBN2132RH

[Anonymous No.17854215]

>>17851295
This.

Tfw i was only a wagie for 3 years and have more saved up then the average American in all age brackets single and non single with or without children, EVEN after i blew a large wad of my savings.

[Anonymous No.17854268]

>>17850461
Because companies only fund operations by issuing new stock.

Bonds and revenues fund the vast majority of corporate activities.

The layoffs and true economic pain will start when revenues plunge due to unmet demand and then bonds can't be paid.

We are at the peak of the largest corporate debt spree in history. Larger than the 2008 mortgage market. All bottom barrel leverage rates and cov lite garbage chopped into collateralized loan obligations. When the bond market falls, that's when the collapse will hit.

People are panic selling because they know that drying revenue streams = massive defaults on shit debt. ATT alone owes $88 billion and has to constantly refinance to stay afloat.

[Anonymous No.17854293]

>>17850461
I was laid off 2 days ago.

[Anonymous No.17854306]

>>17851547
Annie are you OK?

[Anonymous No.17854319]

>>17850641
>>17853995
The market was so inflated that a "correction" puts us in great depression territory.

[Anonymous No.17854382]

>>17850461
>If stock market is collapsing, why arent companies going bankrupt and people losing their jobs left and right like in 2008?
The housing bubble popped in 2007 and it still took a year for that to percolate to the rest of the economy

[Anonymous No.17854721]

$4.1 trillion in corporate bonds comes due in the US in 2020.

$1.3 trillion is junk bonds status and will require credit access to refi.

The corporate debt marker is crashing harder than stocks. The bomb is just getting primed guys.

BTW, they started chopping these up into collateralized loan obligations like mortgages and stamping them AAA. They invented covenant light, aka cov-lite loans, which are basically the equivalent of ninja mortgages. Companies had no restrictions on uses and didn't have to produce financials to borrow. Some even used billions in loans for "debt funded dividends."

But there are no credit default swaps, right?

No, these are all hedged with trillions and trillions in interest rate swaps. Interest rate swaps were small.in 2008. $250 trillion today, by far far far and away the biggest derivative class. They are less risky but have systemic counterparty risk. If bonds go fallen angel, 2008 is going to look like the early 1900s crashes and 2020 is going to look like 1929.

[Anonymous No.17854757]

>>17851137

This will snowball. People will stop buying luxury goods as soon as the work slowdown is realized in people’s amount of disposable income, and then slowdown in business and production will follow the reduced consumption. Dude you’re not thinking ahead at all

[Anonymous No.17854876]

>>17854039
heres the thing
this HAS been going on longer than you all seem to think.
the banks have been fearing a liquidity crisis for quite a while now. same as 08, its not something they wish to tell everyone cuz muh PANIC.

this is the situation since well before the virus even existed, let alone before world govts started taking it seriously
hence the need for the unprecedented overnight repos that the fed has been doing for MONTHS and MONTHS now. theyve been trying to help corporations/banks unwind their leveraged stock buybacks of their own shares that theyve been buying since 08.
but now both the banks AND the corporations are underwater.

THATS what the $1.6T was for
not for fed to buy stock and hold it, but to sell it and unwind it onto the market.
banks need liquidity so the fed is buying it overnight, then dumping it onto open market and letting the banks buy it back up. its definitely not the whole amount of those loans, but its the best we got right now.

should all those "numbers on a screen" pop, the amount of """wealth""" that will be destroyed is unfathomable. this will make the dollar exceptionally rare (as actual physical currency IS actually quite rare in a global market that trades on USD, but does so mostly electronically).

if you are familiar with the deflationary phenomenon of the US in the 30s, you will understand where im going with this.
that crash was due to private investors that used margins to buy stocks. when they all got taken to the cleaners in the crash, banks had no liquidity. all that funny money was gone all at once. banks HAD NO DOLLARS (and never really did), and everyone who didnt already have all their dollars out of the banks prior to it got REKT for everything they owned (or rather, didnt).

now take this scenario and instead of private investors trading on margins, replace them with corporations and the large banks themselves.

TL;DR
unfortunately, were rooting for the fed here.
should they fail to unwind this, its ogre

[Anonymous No.17855005]

>Boomers hold almost 90% of equities.
>Day of the Pillow comes
>Same time, massive wave of corporate defaults and bankruptcies.
>Boomers hold all the assets.
>Probate courts totally unable to cope.
>Assets frozen for a year plus.

Ruh roh.

[Anonymous No.17855175]

>>17851295
They don't buy iPhones outright and the iPhones are specifically priced optimized to be as expensive as possible while still affordable for the majority of people's debt limits.
The system is rigged. The entire thing is unnatural. The market is completely insulated against risk and competition by constant government intervention, and cannot survive entirely natural market fluctuations caused by things as mundane as diseases, inclement weather, and workers not being available as functional slaves.

You idiots will keep suggesting this is a system that can function long term, and will continue to tell everyone who knows the math and can see where the curve flattens out that this crony capitalism is the best way to do things just because you can point at failed command economies and then screech about how everything has to be a dichotomy.

[Anonymous No.17855222]

>>17855005
i know man
were really fucking in for it big time

KEEP FUCKING PRINTING JEROME
PLEASE
HURRY

[Anonymous No.17855280]

>>17851255
They won't be able to afford them. I've already got three college-aged girls living in my house who lost their retail jobs because of this have agreed to be part of my harem in exchange for shelter because they can't pay rent anymore. There are going to be millions more.

[Anonymous No.17855285]

>>17854876
Sorry to ask you what will likely seem like a very stupid question, but in your last tl;dr, what do you mean "unwind this" how can they unwind it? If I am to understand correctly, the banks can now borrow for free AND have 0% reserve requirement, meaning they can lend to each other (can they lend to themselves???) to buy-back shares... (BUT..didn't half a dozen banks say they would suspend share buy-backs?) Where does all this go? --Also, this is a leap, and should you reply I would consider you quite generous, but what would you say are some fairly safe bets in lieu of all this, either for puts or shorts? --At the moment I'm shorting index and banking funds, and I do expect the dow to go to somewhere around 1200, if not lower, simply considering market-cap to gdp ratio and past recessions (and this really seems like a global recession). Thoughs?

[Anonymous No.17855333]

>>17854721
even more junk as market goes lower, and as corporate profits sink, right?

[Anonymous No.17855348]

>>17855175
womp womp

[Anonymous No.17855352]

>>17850461
The market is collapsing on the expectation that bankruptcies are coming. People are getting out while they can.

[Anonymous No.17855838]

>>17855285
its kinda above my paygrade to explain in detail
look up what stock buybacks are
then look up what overnight repos do

corps have been, since rates got brought to nil in 08/09, buying their own stock on lev (borrowed from banks obv).
this makes shareholders happy so theyve done it for years now.
banks, who were starved for rates after being regulated, looked to corporations for their risky rates so they could get yield at all (what they were getting from subprime memes before).
since stonks go up, the corps are seen as good borrowers, so this creates a credit feedback loop.
go take a look at TSLA NFLX FBs etc corporate bonds.
yields at like 7-8%
thats been banks bread and butter for a decade now

its much more complicated than this even tho, as corporate debt doesnt even need to pay principal on maturity. they can just roll out to more. so i have NO fucking idea how much needs to be unwound.

>the banks can now borrow for free AND have 0% reserve requirement, meaning they can lend to each other
i believe thats exactly the reason for all the fed nonsense recently. its the only way i can explain them dropping rates so early.
>can they lend to themselves???
i think thats where were going. im not sure how else to do this quick enough

>but what would you say are some fairly safe bets in lieu of all this, either for puts or shorts?
idk man im just some scrub who likes to autism ovevr numbers. i cant give you advice.
if what im saying is correct (pls god no), you wanna long USD, and short almost everything else. boomer rocks are still way too high if we ARE in a deflationary crisis, so that would be a thing that would correct dramatically.

personally ill be looking for whatever corporations have the highest yield, junkiest bonds, and have been doing stock buybacks the most.

the problem is, if im right about this, then you dont want your money in the BROKERAGE either.
thats whats so absolutely fucking terrifying about this possibility

[Anonymous No.17855942]

>>17851295
Paying monthly for a shitty $1000 iphone instead of a new car or house like people used to do

[Anonymous No.17856437]

>>17850461
Because we've dropped further in a few weeks than they did in a few months diring 2008 and people are falling for the "its just a flu" meme

[Anonymous No.17856692]

>>17856437
this is no longer simply about meme flu

[Anonymous No.17856743]

>>17850461
I mean, give it a few days.

[Anonymous No.17856921]

>>17854268
this.

[Anonymous No.17856976]

>>17851295
I used to think like you
You’ll evolve and realize you’ve been conned by the Jews to think fucking over the less educated and wealthy near you is better than fucking the elite

[Anonymous No.17857000]

Bruh, we are less than a month into this, the last recession took place over years.

[Anonymous No.17857028]

>>17855838
Thanks very much! --you are a very insightful guy, I always appreciate posts like yours, truly gold among alot of else. Question: by "boomer rocks" are you talking bonds? or literally talking gold (that boomers like to buy). I too finally bit the bullet on gold, and bought today (junior miners)...just simply due to the massive inflation I now see as unavoidable.
-we must remember to diversify in all of this, and also, that money doesn't hold the value, it is the items of utility, and their means of production that hold the true value. I went out and bought some tools I can use to fortify homes if it comes down to it in the next few months ;) . Might sound outlandish, but for a few hundred I can be in business.

[Anonymous No.17857038]

>>17850517
This, most people don't realize how fucked the whole system is, from creating currency, to deficit spending, to fractional reserve banking, to the entire world using the USD, and a shitton more. Honestly, it took my a while to understand it myself and it just seems so inherently fucked I don't know how politicians go their entire careers mot giving a shit about it.

[Anonymous No.17857091]

>>17850461
...yet

[Anonymous No.17857450]

>>17857028
im just a scrub man
pls dont do anything i say without knowing and understanding it yourself

boomer rocks= gold/silver which are generally seen as inflation hedges. deflationary spiral would likely crush them tho, as all their """gains""" since the great depression are on the back of fed manipulated inflation over the years.
so to be clear, im not saying BUY them, im saying that they might go through the center of the earth (or at least FAR below where theyre valued right now). if banks all get liquidated from corporations defaulting on them, since all their money is funny money, all those 1s and 0s on computers around the world go POOF. and that makes the few existing physical dollars worth MUCH more. this effect would similarly crush almost any non-cash asset.

some people have suggested crypto, but i dont buy it, seeing how its been acting alongside this. it would need widespread acceptance BEFORE a crash, not after, or it will crash alongside non-cash commodities.

the fed printing like mad would, in ordinary times, cause massive inflation over time.
but i dont think theyre doing it for usual times.
i think theyre trying to pump out as much free money into circulation to get out ahead of the possibility of DEFLATION soon.
that could mean the fed is anticipating large banks going under

read this guys posts, hes clearly much better educated on all of this.
>>17854268
>>17854721
>>17855005
but ive also had my eye on this corporate debt bubble, for years now. so to hear someone clearly more intelligent than me echo the sentiment has me shook ngl.

[Anonymous No.17857501]

>>17854114
when you give corporations a trillion tax cut you can stimulate the economy but only for a short while. Trump has tried especially recently to keep the economy steady as this is election year and pandemics causes markets to crash.

[Anonymous No.17857542]

>>17850461
seriously, everyone is being a doomer over this. Take your pick of good stock prices, and sell when it returns to normal, or take the peak.

[Anonymous No.17857643]

>>17853144
Yeah I’d smash the living fuck out of her box

[flu=flu "corona" virus = mass (...) No.17858003]

>>17856437
No one knows future except few people who rigged the game with money. Purpose is take money away from you, so that you will be forced to serve, create, build, breed, feed... grabbers trade hard and it just few of them that benefit from us all . 9 of 10 investors loose their money that is truth. So are you 1 of 10 who can handle? Free cheese is in the rat trap. say good buy to your stock for 5 - 10 years and your money comes back , maybe. We live in tax enclosures, guarded by guns and pacified by suggested imagination.

[Anonymous No.17858009]

>>17854721
>BTW, they started chopping these up into collateralized loan obligations like mortgages and stamping them AAA. They invented covenant light, aka cov-lite loans, which are basically the equivalent of ninja mortgages. Companies had no restrictions on uses and didn't have to produce financials to borrow. Some even used billions in loans for "debt funded dividends."
literally 2008 subprime shenanigans times 1 gorillion
housing crisis would be peanuts compared to the insane amount of damage that such a fuckmassive crunch would cause.

>But there are no credit default swaps, right?
>No, these are all hedged with trillions and trillions in interest rate swaps. Interest rate swaps were small.in 2008. $250 trillion today, by far far far and away the biggest derivative class. They are less risky but have systemic counterparty risk. If bonds go fallen angel, 2008 is going to look like the early 1900s crashes and 2020 is going to look like 1929.
^^^^^THIS^^^^^ is the part that has me convinced this is the end of the civilized world

FUCK the fucking meme flu
if this bomb goes off, we will all be daydreaming of the days of 2-4% global fatality rate, and a max life expectancy of 65, from a pandemic turned endemic
you guys are NOT seeing the bigger picture here
if corporate debt bubble pops were unironically madmax nao

[Anonymous No.17858168]

>>17853736
Lmao selling DVDs is a hobby in 2020, never could bring in any real money. I sold all my Dad's old CDs last summer to boomers on eBay and the margins are pennies at best. Good way to build positive feedback though

[Anonymous No.17858177]

>>17855838
>personally ill be looking for whatever corporations have the highest yield, junkiest bonds, and have been doing stock buybacks the most.

Brianlet here. Can you explain your reasoning behind this

[Anonymous No.17858263]

>>17858177
read my posts ITT
and ESPECIALLY read this guys posts
>>17854268
>>17854721
>>17855005

[Anonymous No.17858589]

We enter the Crisis period. Strap in lads, it's going to be a bumpy ride.

[Anonymous No.17858598]

>>17851641
>Trump is the fed
The only one deserving a hanging here is you for being a sub 80 IQ mongoloid

[Anonymous No.17860057]

>>17857028

[Anonymous No.17860636]

>>17851371
yeah because those "products" are literally addictive. you dont see how that is kind of a different thing?

[Anonymous No.17860726]

>>17851881
the corona virus isnt the bomb itself, its merely the fuse.

you will realise that within the next two weeks

[Anonymous No.17860824]

>>17860726
i realize it now desu
im just praying im wrong

[Anonymous No.17861575]

>>17855838
just to make sure i understand you correctly:

you are talking about a "long" in physical dollars, not converting stock to fiat, right?

desu i disagree about the deflation part. why wouldn't we enter hyperinflation?

[Anonymous No.17861634]

>>17857038
this

[Anonymous No.17861795]

>>17857450
physical dollars can be printed too tho.

i think your thought about deflation is one step too far behind. the FED would just print physical dollars and people would lose trust in the dollar either way. this would lead to hyperinflation and thats where i see crypto play a role.

its either gonna be crypto (cant pay online with boomer rocks) or its gonna get THAT bad and we will basically have boomer rocks, food & ammo as currency.