E Whatever Hit The Fan

Today the proverbial whatever hit the fan. The trigger for the US stock plummet was a very large number of new jobless applicants last week, of 861,000 unemployment registration, against an estimate of only 773,000, but in fact, the rout began in foreign markets overnight. Mighty Walmart WMT failed to meet estimates of earnings and warned about sales flattening this year. It certainly is hard to hold onto shares that have risen astronomically since last March. It is hard to stick it out when Robinhood and Reddit are under federal investigation for misleading stock investors on how free their trading and advice really was. More and more, stock websites and even the covers of Barron's weekly are serving us with ads, not advice. It is tough remaining invested when fear of inflation and recession alternate in the news. You need the gumption to stay with classic stocks and bonds when the easy money seems to be coming from bitcoin. You need a long view to continue to hold equities and bonds when guru Bill Gross grossed $10 mn from the GameStop buying panic (according to Citywire in London today) and none of us ever risked that much money in a single position. London was hit by a rise in sterling.

Business newspaper article

image source

Moreover, there is even worse news from the WHO over the pandemic we are suffering from, not that new variants are popping up all over, known for 10 days, without any certainty about how contagious mutations are, but that the vector between the bats in their caves and the Wuhan market where the infection hit humans probably was bunnies. Chinese people eat rabbits, as do many Europeans, like the French. It would have been more comforting if the vector would have been something only Chinese people eat like dogs or badgers. (We never ate bunny because our Paris upstairs neighbor, my daughter's pal, had an incontinent pet rabbit and because I have a lingering fear of non-kosher critturs.)

Anyway, there are reports and news today from Canada from our companies.

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William K. 2 weeks ago Member's comment

What I see as the problem with stock estimates is that they seem to be based mostly on wishes, modified slightly by what is known of what folks want to hear. I read the predictions that some market will be worth hundreds of millions in two years, and then two months later there is no such market. And while "sunshine" is bright and cheerful, two much of it in the wrong places is unfortunate.

And while the exact vector for the spread of that virus in China may be interesting, the guilt lies on the local officials that hid the warning, for purposes of saving face, it comes down to. I can not imagine an adequate response to tha damage they did.