RE:RE:RE:RE:RE:RE:Too Early to BuyIn 2008 millions of people went homeless basically only in the USA. Prime rates and bond yields dropped basically into negative territory and have never regained ground since in the past twelve years.
Instead central banks piled on stimulus with cheap credit for the past twelve years without ever really normalizing rates again for fear that the fragile economy would again collapse, leaving the rest of us to scramble looking for deals in equities to "save" for our retirement.
For the past twelve years the economy never really fully recovered. Markets went gangbusters but wages and savings stagnated while people piled on ever increasing debt.
Now we're faced with a virus which will spread ultimately to the entire world's population with a mortality rate somewhere between 3 and 6 percent depending on age demographics and that kills in a matter of weeks. Vaccines are two years away. People are being ordered to self quarantine every time they sneeze. Hospitals are woefully underequipped to handle millions of patients at once.
What does the governement do in response? It cuts interest rates and accrues more debt. Paid by what? Negative bond yields? How low can you go from 1.25%? The well has run dry. Print more money? Inflation is already way above the posted numbers.
Like it or not, dealing with millions of critically ill and quarantined workers is going to put a TREMENDOUS (The orange faced clown's favorite word) strain on the economy that will ultimately affect even our sacred banks.
And in 2008 The banks lost about 40% of their share prices and didn't bottom out until well into 2010.
So I repeat. Only a moron would hold bonds now or buy banks at the beginning of this crisis.
It will take a minimum of a year or two for this to shake thru the system.
And the Russia/Saudi price war is just icing on the cake.