I am still kind of surprised we are in a raging bull market and no one is taking a pause to see how it plays out. I am looking at my supply chain disruption for my business from the extended Lunar New Year shutdown. I don’t know when stuff will start flowing smoothly again. People are being put on unpaid leave in transportation and healthcare (elective surgery options) across Asia. Unless you had a company that supported work from home, in multiple cities in China people have no income and what not during the quarantine period. Air transportation between China and the US is completely disrupted for the forseeable future.
the SouthEast Asian and Korean governments and institutions are taking their growth forecasts down. Upstream factories in other countries are idling.
All of this will have an economic impact. So, why does the market keep rocketing up every day? What am I missing?
Economy and market reactions are different things. If they are the same economists would all be billionaires. I don’t know why markets behave the way they do. People who claim they know are kidding themselves.
I still think the economic impact will be huge. All the local reporting I read paint a very dire situation on the ground. But as long as the music is on I am still dancing.
There is a green trend. Sell oil buy Tesla crowd . Won’t last. Oil will be needed at least for the next 50 years. EVs and solar might be 20% of the demand by 2030. But oil and gas will be needed for a long time.
So far feel like a rotation. Today cloud stocks are punished while semiconductors, China and mega caps are doing well. Before that, cloud stocks did very well while mega caps and semi tumbled. I have all these categories Today MU and IQ bought last week shot up, so I take profit Plough some to cloud stocks. Keep the rotation going Some cloud stocks are recovering.
Another strange phenomenon that netizens have noticed is the mortality rate, as the government death tolls are routinely maintaining an exact percentile for days on end. Many noticed that in the early days of reporting, the government put the death rate at 3.1 percent.
By late January, the government apparently decided to set the new official mortality rate at 2.1 percent. As can be seen in the image below, the mortality rate was kept at a precise 2.1 percent, regardless of the numbers from Jan. 30 to Feb. 3:
My pet theory why US market is shrugging off the virus so far is because we are still very much in a trade war with China. Market had already priced in the worst and the last 6 months has been busy rallying as the worst didn’t happen.
This theory has no prediction value. It’s just very much BS’ing.
If the trade war didn’t convince a company like Apple to actively diversify their supply chains, the virus threat should finish the job. It also shows a deeper rot and lack of capacity in the Chinese state than previously acknowledged.