March 26th

Writing at market close today 4:!3pm to be exact.

The coronavirus has hit two major marks today in terms of numbers 500,000 infected worldwide and 1,000 deaths in the USA. We also have reached a point, reported by The Washington Post, where half of the global population is now living under government restrictions.

This continues to astound me as this virus works it way through the world.

The emergency relief bill of $2 trillion dollars is well on its way to being completely passed and getting set to work. This has been some really quick government work in comparison to how things are usually done. Hopefully they can get money to those who need it quickly, there are lives to save from poverty as well as health right now.

The biggest number though: 3.3 million. That is the number of weekly jobless claims that came through today. To put this into perspective, the old record was just under 700,000. That’s an immediate 1% decline in employment, and the virus is just getting going.

This is only the first of many reports that are yet to come and I expect it to get worse. Remember that many companies have yet to actually shut the doors, this is just the tip of the iceberg of unemployment.

The Market

So I got up today, saw futures were slightly down and was not surprised. I saw the jobless claims, again not surprised.

Then the market began to rally. I was surprised.

The DOW finished up over 6%, the S&P up over 6%, the Nasdaq up over 5.5%. This is not what I was expecting to see today. This marks the third straight day of gains and my portfolio looks much different than it did just three days ago, up over 20% in that time.

I came in today ready to purchase when we had the inevitable downturn. Instead, I ended up putting the computer up, going for a run early, and reading a book, not even looking at the market more than twice all day. Color me shocked by the rally right now.

I do expect us to see a sell off tomorrow. I expect us to see a sell off again to close to the place we sat this past Monday. Of course I could be wrong. If I am, I am okay with that. If not, that is why I am still sitting on about 25% cash.

The main losers currently in my portfolio is some of the positions I had taken in undervalued companies before the virus struck. I have been adding small amounts along the way down in many of the names and will continue to sit in them. It’s my belief that oil names will rebound soon and some of the industrial names I am in are undervalued, not only now, but at the original price I obtained them at.

I will continue to be patient here and use my valuation tools to guide me. It hasn’t led me wrong much, and over the long term I still believe in the process.

Until next time, stay safe and stay invested.