Marc De Mesel: Bulls Likely to Ignore Negatives, Coronavirus Outbreak Not Exponential

  • Sunday, 01 March 2020 07:23
Invested half my cash (10% of portfolio) into #Tesla again, raising my exposure from 50% to 60%, still 30% Crypto and now just 10% Cash left. This because stock market, and $TSLA in particular, corrected strong from $950 to $650 past weeks while Coronavirus on the other hand, thou concerning, is actually not growing exponentially. On logarithmic scale this shows very clearly. So even if u would tenfold numbers correcting for under reporting, this declining trend is still there and very hopeful (https://twitter.com/MarcDeMesel/status/1233326404885979138). VIX index also shows historical high reading of 40, and just judging on past weeks sell off is of similar magnitude as Lehman default sell off in 2008 (https://twitter.com/TheBubbleBubble/status/1233395034961141764). Even if it corrects a lot more, a rebound is likely from here, and can still decide to stash more cash again once it does. However, more likely is that once rebound happens, people also become more positive again, shrug the bad news under the carpet and stock market continues it's long term bull market as a correction was just seen in 2018, and is still few years off most likely. Coronvirus does not look that concerning to me as perceived today, the high amount of deaths seems most likely due to severe mismanagement by the Chinese Communist Party suppressing free speech and sending people away that need intensive care or even locking people up in their houses, as the individual there is of much less value than the group. Just like with flu or couch, once people protect themselves by avoiding gatherings, washing hands often, avoiding to be with people in small unventilated spaces, it seems to spread a lot less fast. Chance for a vaccination and good therapies to develop over next few months is high as medicine, in contrast to investing, has luckily already developed into a science where evidence rules and charlatans are scarce.

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