How far can the stock market fall?

oldman

Well-known Member
Location
PA
I talked to my son yesterday afternoon and he had just purchased some Boeing stock. He thought the price was too attractive to pass up. Personally, I am not buying anything.
I follow BA quite closely and in fact, always flew Boeing equipment throughout my career as a pilot for United. I also traded BA quite a bit for years, even through the ups and downs.

I was impressed with their earnings and even the way they recovered after the two crashes on their newest version of their B-737-MAX. However, the 737-MAX still has not received approval from the FAA to fly again. All orders for the new plane were recalled by the various airlines that had purchased them. I’m not sure if they have even settled with the families of the 346 families that were killed in those two crashes.

Now, with travel being what it is, many of Boeing’s orders have been either cancelled or put on delayed delivery. Boeing is also asking for gov’t help (bailout). I think your son would have done better waiting before buying. It’s going to be awhile before recovery sets in for any travel related industry. But, that’s just my opinion. Like the old saying goes, “Never buy a stock on the way down.” I wish him and all investors good luck.
 

mikermeals

New Member
Location
Chicago
I am still all in but down 25% this year. It is certainly scary but as they say the market is no place for the timid. I have put a little in every day the market goes down 1,000 points. We could go down another 25% but life will return to normal at some point in the next six months. I would say one year from now I will be better off than the 1% return in money market. Once there is a glimmer of hope with drugs that can treat the virus like Regeneron is working on the market will go up. Markets look out into the future and like "certainty"and right now there is no end in sight or even a glimmer of hope.
 

oldman

Well-known Member
Location
PA
I think with the earnings reports coming out next month for the first quarter, the market may go lower because for most of the sectors, earnings shouldn’t be good. Certainly, the food sector should be spot on and maybe medical, but after that, who knows?

I pulled the plug when the market hit 26,500 or there about. I did the same back in 2008. I just couldn’t see the economy sustaining with oil at $150 pb. I have a very good friend who retired at 50 years old. He decided to ride it out. He started with a million and a half and when the blood letting was over, he had less than half million. He had to go back to work selling real estate and did recover.
 

Camper6

Well-known Member
Right about the vaccine. And I was talking about the US in regard to cures. Although I'm not aware of a lot of innovative pharmaceuticals created by governments anywhere.
The U.S. is dependent on China. Parmaceuticals is a big industry in China.
We should start a poll on which country will find a vaccine first for the COVID-19.
 

Camper6

Well-known Member
I think perhaps you don’t understand how the market works. Take a large cap stock and as it declines, it will be removed from the large cap sector to the mid-cap sector. If it continues to decline, it was again be removed from the mid-cap sector to the small-cap sector. If it still declines, it could be de-listed and end up being traded on the OTC or as some call it, the pink sheet.

What the company’s value is when their assets, including cash and outstanding debts are tallied and then their liabilities, including their accounts payable is deducted to get a net value is different from what the stock is worth.

A company can have a billion dollars in assets, but if it isn’t bringing in any money with what they produce or products or services they supply, the stock isn’t worth much, if anything at all to investors.
It depends on what assets you are talking about. Someone is always willing to take over a company that might have been mismanaged or didn't have enough capital to survive start up costs.
 

oldman

Well-known Member
Location
PA
The U.S. is dependent on China. Parmaceuticals is a big industry in China.
We should start a poll on which country will find a vaccine first for the COVID-19.
To me, it doesn’t matter. Unless it is approved by the
It depends on what assets you are talking about. Someone is always willing to take over a company that might have been mismanaged or didn't have enough capital to survive start up costs.
What you are talking about is a different duck. What I am referring to is a company that keeps their board through the process. If a company is sinking and is bought out, the previous shareholders would probably get only a fraction of the shares of the new company compared to what they are holding.

I owned stock in a waste management company. The stock sold for $17 when I bought 200 shares. It climbed to $30 and I continued to hold the stock. A few months later, they were denied an application to start a new landfill. The stock slowly began to sink, but I still held it. The stock fell to $20 when the company was bought out by a very huge waste management company. Their stock was selling at around $70 per share. I received 33 shares for my stock. Do the math. Not a big loss, but it was a loss, which was OK because I had a good year, so some capital loss helped with the taxes. I had another deal where I did receive enough stock that matched what my original investment was.
 

Camper6

Well-known Member
To me, it doesn’t matter. Unless it is approved by the

What you are talking about is a different duck. What I am referring to is a company that keeps their board through the process. If a company is sinking and is bought out, the previous shareholders would probably get only a fraction of the shares of the new company compared to what they are holding.

I owned stock in a waste management company. The stock sold for $17 when I bought 200 shares. It climbed to $30 and I continued to hold the stock. A few months later, they were denied an application to start a new landfill. The stock slowly began to sink, but I still held it. The stock fell to $20 when the company was bought out by a very huge waste management company. Their stock was selling at around $70 per share. I received 33 shares for my stock. Do the math. Not a big loss, but it was a loss, which was OK because I had a good year, so some capital loss helped with the taxes. I had another deal where I did receive enough stock that matched what my original investment was.
I know all about that. I went through it a long time ago.
But one company I was with that went under had a huge inventory of really good equipment.
They were taken over and are now quite successful. I worked for them.

The shareholders were taking everything out and not putting anything back in.

Yes you got something and something is better than nothing.
 

mathjak107

Senior Member
Boeing, United Airlines, Verizon, JP Morgan...all on sale!
no such thing as a sale ..... markets have no memory ... prices are what they are because that is all they are being valued it .... prices are lower , that is about all we can say .. many stocks never went back to their pre 2000 days....

it makes us feel good to call it a sale , but it very well may be these sales are still overpriced if it takes another 13 years inflation adjusted for markets to just break even with where they were.. it took the s&p 500 13 years .

so never confuse lower prices with SALES
 

Liberty

Senior Member
Location
Texas
Wondering how many owned Lowes and or Home Depot stock...look like good prospects in today's "stay at home, fix it up" lifestyle.
 

mathjak107

Senior Member
Wondering how many owned Lowes and or Home Depot stock...look like good prospects in today's "stay at home, fix it up" lifestyle.
well with the potential for a real estate market crash as people loose jobs , get pay cuts , hours cut , and business fail many are just not likely going to spend an extra dime they dont have to. or few may want to put anymore money in to a an asset on the verge of falling like their homes .


home depot plunged 26% in one week
 
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Liberty

Senior Member
Location
Texas
well with the potential for a real estate market crash as people loose jobs , get pay cuts , hours cut , and business fail many are just not likely going to spend an extra dime they dont have to. or few may want to put anymore money in to a an asset on the verge of falling like their homes .


home depot plunged 26% in one week
Lets pray its not that bad, and just that this is a temporary measure get through this period. Maybe a couple years from now you'll never know the difference, hopefully.
 

Liberty

Senior Member
Location
Texas
We have a very flawed view here perhaps since it is a crisis in this city beyond belief
I certainly can understand why. I've had some that wanted to drive across several state lines to stay with us here ...to wait the stuff out here with us, but we discouraged them. Who knows what they would encounter on the way down. This is a perfect place to "shelter in place", though. Who was it said if you have a library and a garden you will want for nothing?

Say Just be patient, math...can imagine its so very different living in the city. This will be in the rear view mirror.

Lets pray everything comes out fine and we get back to normal. I was in quarantine for 9 months when 6 years old - almost died. Now that's about 10 years in kids' time you know. Still remember things about that period. Recently it brought back a lot of memories.

We'll all get past this and be better people for it. Bet you on that, guy! What are your fav drive through fast food joints?

This is the first time and my life we are visiting them once in a while...hub loves it...lol.
 

Don M.

Well-known Member
Location
central Missouri
I just looked at the market futures....all are down about another 4% for Mondays opening. Wall Street traders will not be working the trade floor, due to the stay at home directive, and most trading will be done by "automation". A 50% drop from the Feb. highs is looking more and more like a real possibility.
 

fmdog44

Well-known Member
Location
Houston, Texas
The consensus is when the market starts to recoup the rise will be sharp because it will be reacting to the virus concerns being reduced. If that is the case many will miss the initial upsurge unless they get real lucky. This could be the first time the average investor can make a call if they follow closely the predictions on the virus status.
 

mathjak107

Senior Member
You are not alone. Who really is going to get hurt is those close to retirement that have to push that day back and worse if they get laid off.
people who are going to be retiring and do so in a bull market make the mistake of putting the carrot on the stick ...they hang in there trying to get every last penny in gains with higher equity levels then they should .

it is never markets that spoil retirement plans , it is bad plans ....

with a pending retirement arrangements should be made to have lots of cash and bonds to hold you over just in case you get zapped right up front when you are ready to retire .

there are lots of all weather defensive portfolios that hold up well in times like this
 

Don M.

Well-known Member
Location
central Missouri
The consensus is when the market starts to recoup the rise will be sharp because it will be reacting to the virus concerns being reduced. If that is the case many will miss the initial upsurge unless they get real lucky. This could be the first time the average investor can make a call if they follow closely the predictions on the virus status.
Predicting any market recovery, during this crisis, is going to be Very Difficult. There are so many Unknowns hitting the markets that we are probably entering "uncharted waters". The Primary determinant will probably be progress on controlling the spread of this virus, and finding a cure....and that may be months from now. Then, as the economy continues to be impacted by the expected numbers of job losses, etc., any sustained recovery may stretch out to 2 or 3 years....if not more. I doubt there will be any "V" shaped recovery of the markets, especially the longer this uncertainty remains. About all an investor can do, at this point, is follow the financial and global news closely, and carefully evaluate their own financial "health", and asses their tolerance to risk. If a person is able to "guess" successfully, the gains could be substantial in coming years...but, at this point, investing is almost like playing Roulette at the casino.
 

Liberty

Senior Member
Location
Texas
Just Skyped with my friend at WHO...think we'll have a while to go till they get the "magic bullet". It could be scary opening back up the international flights. That seems to be where a volume of new cases are evidenced. Look at Hong Kong.
 

oldman

Well-known Member
Location
PA
I have to retract my previous comments regarding the market going lower after earnings come in next month. I believe now that poor earnings are already being written into the prices of stocks now.

I really can’t see some of the big caps going much lower, except maybe for those in the travel business. Discretionary stocks should kick up, especially after the stimulus checks go out.
 

Pepper

Senior Member
The stimulus checks going to individuals will be chump change and many will receive no checks at all.
 

mathjak107

Senior Member
The stimulus checks going to individuals will be chump change and many will receive no checks at all.
like last time , it wont stimulate a thing ..it will pay already existing bills or go in to savings .... very little bought new things ... they don't give it to the higher incomes who ironically would likely spend it on new stuff
 


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