“Study the history on bear markets and how long they last. That will tell you what you want to know.”
I hear you, but my point is that this is OUTSIDE of the any box, and that is why so many people here were caught flat-footed despite the obvious warnings coming out of China.
There’s still a feeling that ‘this will pass’ and everything will be ‘normal’ again - 2 months at the most, but probably 2 or 3 weeks. It won’t happen that way. But again, that’s thinking outside of the box, and applying what I see around the world, not what Dow charts tell me about the past, considering that they’ve never priced-in a pandemic on this scale. And what I see around the world is China, very, very, slowly coming back to life, and scared Shiiteless that they may re-trigger the virus and have to quickly go back to lockdown - again for many weeks at a time.
We’re just catching up to where the market should have been a week after the Wuhan lockdown...and it will be a while before the market catches up to the incredibly slow recovery going on in China. But the writing is all there...if people put down their charts and look across the Pacific.
The reason history matters is that human nature has not changed—and markets are driven by the emotions of human beings....so imho you are over-analyzing—a bear market has to run its course,,,and history gives us a good feel for what that looks like...
The whole concept of a bear market is that it over-compensates on the negative side.
I am a novice in terms of understanding financial markets, but I understand
balance sheets fairly well.
One thing that concerns me is the number of US corporations that might be at risk of asset seizure by China. I would like to know a great deal more about supply chains into this country. How much inventory, physical plant and equipment do public companies traded on Wall Street carry on their books that is physically located in China?
I can remember these questions being asked many years ago right here on FR. But the national security arguments lost to free traders.
As for what will happen in the long run, what will happen is asset reallocation. There will be winners and losers when that occurs.