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Coronavirus and the economy. (2 Viewers)

ekricket said:
In this age of social distancing I’d think UPS is going to be doing pretty good delivering stuff right and left. It’s probably a trend that’s going to take off even more, so delivery companies are going to do good.

Other areas that might do well
Netflix
Board game companies
Online gaming companies
Pizza chains that deliver
Marijuana dealers (legal and illegal)
Beer companies
Hobby Lobby and the like
Bicycles and motorcycles
Pet adoptions
Golf courses
And as it warms up fishing equipment
I forgot this one, but Scams will also do well
Plumbers too
Click to expand...

Here is a list of the little guys that this will absolutely crush:
All of the hawkers that work professional sports and racing. Thousands of people not working. Their lost income is happening now. What benefits do workers have that bring your coke to your courtside seat? - Not a damn thing.
Any small business owners, bars, restaurants, hot dog stands, parking lot attendants... anything near the stadiums that survive with the huge crowds. They are screwed until the shut down ends...then will the stands be filled?
Airlines will begin laying people off or reducing hours
Hotel staff?
Restaurant staff except for delivery service

and could go on and on and on...

Since most Americans don't have enough in savings to miss a couple pay checks...well...spending stops. None of these people could give a rats ass about the stock market. They don't own stocks.
 
I work in the mortagage industry, and we are BUSY!!!! Breaking records actually. Now is the time to refi!!
 
slisk250 said:
Here is a list of the little guys that this will absolutely crush:
All of the hawkers that work professional sports and racing. Thousands of people not working. Their lost income is happening now. What benefits do workers have that bring your coke to your courtside seat? - Not a damn thing.
Any small business owners, bars, restaurants, hot dog stands, parking lot attendants... anything near the stadiums that survive with the huge crowds. They are screwed until the shut down ends...then will the stands be filled?
Airlines will begin laying people off or reducing hours
Hotel staff?
Restaurant staff except for delivery service

and could go on and on and on...

Since most Americans don't have enough in savings to miss a couple pay checks...well...spending stops. None of these people could give a rats ass about the stock market. They don't own stocks.
Click to expand...

They also don’t give a rats ass about poker chips or computers or websites.
Who are we supposed to be mad at here, I don’t understand.
 
ekricket said:
They also don’t give a rats ass about poker chips or computers or websites.
Who are we supposed to be mad at here, I don’t understand.
Click to expand...

OP thread is about Corona and economy. Pokerchips, computers or websites have nothing to do with it. You listed some businesses you think will do well. I agree with a few of those. I gave a list of those who will not do well. Sad that this will really hit the little guy and that seems lost.

If the focus here is the stock market, I'd say there are other things that will impact the economy a bunch more.
 
slisk250 said:
OP thread is about Corona and economy. Pokerchips, computers or websites have nothing to do with it. You listed some businesses you think will do well. I agree with a few of those. I gave a list of those who will not do well. Sad that this will really hit the little guy and that seems lost.

If the focus here is the stock market, I'd say there are other things that will impact the economy a bunch more.
Click to expand...

Nothing is lost, people are aware that there is suffering and that it will be a long road to recovery, both medically and financially for a lot of people. But not every post has to say
“people are suffering, how dare you plan rationally”.
 
ekricket said:
Nothing is lost, people are aware that there is suffering and that it will be a long road to recovery, both medically and financially for a lot of people. But not every post has to say
“people are suffering, how dare you plan rationally”.
Click to expand...

You are missing my point, carry on.
 
Sprouty said:
We are in the same boat as you (currently at 4% and looking to remove PMI). They quoted us at 3.375 and it made sense for us to persue it. Hoping to lock in at or below that quote but everything is all over the place right now from the sounds of it. Not sure where everything is at right now and I know my mortgage person has been working from 7am till midnight to try to keep up. She actually called me on Saturday to do over a few things.
Click to expand...

Yeah, I will likely be signing come closing pending any unicorn rates that I can't refuse. I will be saving $22,680 in PMI and $8,937 in interest over just 10 years by doing the refi.......nearly $32k in savings, I'M IN!!
 
379B0994-59BF-4E40-966C-9436756608CD.jpeg
 
It isn't just the airlines, many of the publicly traded companies have spent their cash on buying back stock - effectively decapitalizing the businesses.

Why would they do this? Buying back stock raises the price, at least in the short run. This is intensely profitable to senior managers who's compensation is based on stock options. From an investor's point of view, higher stock prices are better than taxable dividend income. Also, holding a horde of cash makes a company more vulnerable to hostile takeover where their own cash horde would be used to buy them out.

This decapitalization makes the company more financially fragile. During good times, this extra risk tends to reward shareholders. But, what about troubled times? Then we see higher chances of bankruptcy or forced sales. As might be imagined, we are headed into some bad times. The businesses that didn't keep prudent reserves, or didn't at least secure firm lines of credit are going to suffer. And in truth they should suffer some sort of consequence. This includes the shareholders and the bond holders. Excess greed needs to be tempered with the fear of adverse consequences.

Sadly, the workers and perhaps the customers are also "lashed" to the ship. This creates a problem, often deftly exploited by the investment class. We might be ok with the shareholders losing out, but feel differently about the workers and customers. The political class is often happy to justify a bailout "for the workers!" that just happens to save the owners and managers.

In the 2008 - 2010 Great Recession the US government bailed out the auto industry. But this time, the government got something back. The bailout included paying the government back with a psudo-equity instrument. I think this is a good model to follow now.

Companies were lavished with something like a trillion dollars in tax cuts two years ago. Mostly this money was spent on stock buy backs, one time bonuses, mergers and special payments to owners. OK, now said companies are in dire straights, hold out needy hands hoping for a bail out. I hope the government is going to get some "skin" from the needy companies while they pass out another trillion dollars to help salvage critical businesses.

As a tax payer, I HATE getting freerolled. Taking excess risk during normal times and boom times pays off and when things turn south businesses turn to the government for money to save them from the consequences. In 1980, the savings and loan industry was devastated by too many "banks" who took insured deposits and made high risk / high reward investments. If things went well, management and shareholders made very good returns. When things went bad, the taxpayers paid off the insured depositors. Heads you win, tails the taxpayers lose.

I hope we have learned a lesson. If a company needs to be saved, fine let's give them a hand BUT the taxpayer get's a piece of the company in exchange. And we don't need to save every business. Some of them need to fail. If the economy needs someone to fill that void, the free market will ensure a new player will emerge.

Greed needs to be tempered with fear -=- DrStrange
 
DrStrange said:
It isn't just the airlines, many of the publicly traded companies have spent their cash on buying back stock - effectively decapitalizing the businesses.

Why would they do this? Buying back stock raises the price, at least in the short run. This is intensely profitable to senior managers who's compensation is based on stock options. From an investor's point of view, higher stock prices are better than taxable dividend income. Also, holding a horde of cash makes a company more vulnerable to hostile takeover where their own cash horde would be used to buy them out.

This decapitalization makes the company more financially fragile. During good times, this extra risk tends to reward shareholders. But, what about troubled times? Then we see higher chances of bankruptcy or forced sales. As might be imagined, we are headed into some bad times. The businesses that didn't keep prudent reserves, or didn't at least secure firm lines of credit are going to suffer. And in truth they should suffer some sort of consequence. This includes the shareholders and the bond holders. Excess greed needs to be tempered with the fear of adverse consequences.

Sadly, the workers and perhaps the customers are also "lashed" to the ship. This creates a problem, often deftly exploited by the investment class. We might be ok with the shareholders losing out, but feel differently about the workers and customers. The political class is often happy to justify a bailout "for the workers!" that just happens to save the owners and managers.

In the 2008 - 2010 Great Recession the US government bailed out the auto industry. But this time, the government got something back. The bailout included paying the government back with a psudo-equity instrument. I think this is a good model to follow now.

Companies were lavished with something like a trillion dollars in tax cuts two years ago. Mostly this money was spent on stock buy backs, one time bonuses, mergers and special payments to owners. OK, now said companies are in dire straights, hold out needy hands hoping for a bail out. I hope the government is going to get some "skin" from the needy companies while they pass out another trillion dollars to help salvage critical businesses.

As a tax payer, I HATE getting freerolled. Taking excess risk during normal times and boom times pays off and when things turn south businesses turn to the government for money to save them from the consequences. In 1980, the savings and loan industry was devastated by too many "banks" who took insured deposits and made high risk / high reward investments. If things went well, management and shareholders made very good returns. When things went bad, the taxpayers paid off the insured depositors. Heads you win, tails the taxpayers lose.

I hope we have learned a lesson. If a company needs to be saved, fine let's give them a hand BUT the taxpayer get's a piece of the company in exchange. And we don't need to save every business. Some of them need to fail. If the economy needs someone to fill that void, the free market will ensure a new player will emerge.

Greed needs to be tempered with fear -=- DrStrange
Click to expand...
Exactly. We shouldn't be shocked when companies do what our government allows and even encourages them to do. At the very least, taxpayers should get a piece of the business valued at the same amount of their tax breaks. But first, the highly paid execs should be required to repay their bonuses for three years. As long as these guys escape unscathed on a personal level, they won't change.
 
My haircut got canceled, as did my appointment for new glasses.

The busses were still running today, but were very nearly empty, I presume because the hourly service workers that they are normally full of did not have work to go to today.

Sooooo many impacts...

(Not saying we don’t need to take these measures: we do! I just really hope we “bail out” those folks who weren’t on the bus today. They really need it.)
 
Currently staying at the Hilton Miami Beach. Today the local government announced the closing of restaurants and bars. Talking to the food and beverage manager at the hotel. They are suspending breakfast, room service only. Bar still open, but take away.

Talking to the bartender a few hours later. She was just let go. 30 days minimum without a job or paycheck. I tipped her $200. It's all that I had. These folks are going to be hit the hardest. The cost of the cure is going to be more expensive than the disease.
 
CraigT78 said:
Currently staying at the Hilton Miami Beach. Today the local government announced the closing of restaurants and bars. Talking to the food and beverage manager at the hotel. They are suspending breakfast, room service only. Bar still open, but take away.

Talking to the bartender a few hours later. She was just let go. 30 days minimum without a job or paycheck. I tipped her $200. It's all that I had. These folks are going to be hit the hardest. The cost of the cure is going to be more expensive than the disease.
Click to expand...
Definitely the story I've seen with many folks today. I've had to explain to my kids why businesses do that, especially restaurants with razor-thin margins. Work sent us home today, I wasn't there anyway but I had to drive there and get a few items to work full time telecommute.

We have been sharing every food pantry helping we can along with helping buy groceries for families in need.
 
DrStrange said:
It isn't just the airlines, many of the publicly traded companies have spent their cash on buying back stock - effectively decapitalizing the businesses.

Why would they do this? Buying back stock raises the price, at least in the short run. This is intensely profitable to senior managers who's compensation is based on stock options. From an investor's point of view, higher stock prices are better than taxable dividend income. Also, holding a horde of cash makes a company more vulnerable to hostile takeover where their own cash horde would be used to buy them out.

This decapitalization makes the company more financially fragile. During good times, this extra risk tends to reward shareholders. But, what about troubled times? Then we see higher chances of bankruptcy or forced sales. As might be imagined, we are headed into some bad times. The businesses that didn't keep prudent reserves, or didn't at least secure firm lines of credit are going to suffer. And in truth they should suffer some sort of consequence. This includes the shareholders and the bond holders. Excess greed needs to be tempered with the fear of adverse consequences.

Sadly, the workers and perhaps the customers are also "lashed" to the ship. This creates a problem, often deftly exploited by the investment class. We might be ok with the shareholders losing out, but feel differently about the workers and customers. The political class is often happy to justify a bailout "for the workers!" that just happens to save the owners and managers.

In the 2008 - 2010 Great Recession the US government bailed out the auto industry. But this time, the government got something back. The bailout included paying the government back with a psudo-equity instrument. I think this is a good model to follow now.

Companies were lavished with something like a trillion dollars in tax cuts two years ago. Mostly this money was spent on stock buy backs, one time bonuses, mergers and special payments to owners. OK, now said companies are in dire straights, hold out needy hands hoping for a bail out. I hope the government is going to get some "skin" from the needy companies while they pass out another trillion dollars to help salvage critical businesses.

As a tax payer, I HATE getting freerolled. Taking excess risk during normal times and boom times pays off and when things turn south businesses turn to the government for money to save them from the consequences. In 1980, the savings and loan industry was devastated by too many "banks" who took insured deposits and made high risk / high reward investments. If things went well, management and shareholders made very good returns. When things went bad, the taxpayers paid off the insured depositors. Heads you win, tails the taxpayers lose.

I hope we have learned a lesson. If a company needs to be saved, fine let's give them a hand BUT the taxpayer get's a piece of the company in exchange. And we don't need to save every business. Some of them need to fail. If the economy needs someone to fill that void, the free market will ensure a new player will emerge.

Greed needs to be tempered with fear -=- DrStrange
Click to expand...
Best post I’ve seen on this situation with the airlines and other businesses that bought back stock.

Delta Air Lines is a big employee in the area where I’m from (Southern US) and about a decade ago they actually filed bankruptcy so they could reprioritize their debt and come out of bankruptcy to buy Northwestern Airlines. There wasn’t really a need to file Chapter 7. They did it out of greed, and I was one of the creditors that got stiffed when they did so.

Help the people, but when it comes to these big publicly held companies and VCs that over leveraged themselves and didn’t learn their lessons 12 years ago - let the bodies hit the floor.
 
Tarheel4Life said:
Best post I’ve seen on this situation with the airlines and other businesses that bought back stock.

Delta Air Lines is a big employee in the area where I’m from (Southern US) and about a decade ago they actually filed bankruptcy so they could reprioritize their debt and come out of bankruptcy to buy Northwestern Airlines. There wasn’t really a need to file Chapter 7. They did it out of greed, and I was one of the creditors that got stiffed when they did so.

Help the people, but when it comes to these big publicly held companies and VCs that over leveraged themselves and didn’t learn their lessons 12 years ago - let the bodies hit the floor.
Click to expand...
Didn't they also shaft their employees (pension plans, IIRC).
 
Munchkin (spell check but I’m not fighting it anymore) said today that unemployment could reach 20%. Those are insane numbers. We’re going to look back at 2019 as the good ‘ole days for many reasons.
 
so far hawaii looking at doing a 30day no tourism travel, rest. are already shut down only take out orders.
 
California ordered all bars and restaurants shut down today, St. Patrick's Day, the biggest day of the year for 15 days. It's out of control. I was SO looking forward to having a tasty corned beef sandwich.
 
SteveHNo96 said:
California ordered all bars and restaurants shut down today, St. Patrick's Day, the biggest day of the year for 15 days. It's out of control. I was SO looking forward to having a tasty corned beef sandwich.
Click to expand...

Murphy's at Seal Beach is the best when they open early morning on March 17 - RIP bars...
 
Hotels are at 30% capacity, there's people tested positive quarantined in the hotel room
 
slisk250 said:
Murphy's at Seal Beach is the best when they open early morning on March 17 - RIP bars...
Click to expand...

The hardest part is every Wednesday since I came back to California I would go to the Tilted Kilt and get me a plate of boneless wings and fries and it would be super cheap because they're half-price. This is the first Wednesday in 17 months that I didn't get to go. It makes me sad.
 

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