Will stock market collapse equal lower prices at wine auctions?

Tasting notes, varietals, grapes - anything related to wine
Message
Author
jeff ostroff
Posts: 70
Joined: June 6th, 2009, 9:17 am

Re: Will stock market collapse equal lower prices at wine auctions?

#51 Post by jeff ostroff » February 29th, 2020, 8:42 am

DRC was strong both yesterday and this morning. 1999, 2005 and 2009 Rousseau Chambertin's just hammered above recent market highs. 6 bottles of 2002 Clos de Tart might be a new record.

Burgundy under card was very strong yesterday.

Live bids driving pricing higher.

Burgundy supply has been anemic since December 2019, especially 2010 and older. Tariffs exacerbating the issue.

Next weeks La Paulee auction should be a good test.

I am old enough to have had a draft card during Viet Nam War. Only auctions I can remember causing auction pricing to collapse were during the financial collapse of 2008. I remember Acker cancelling an auction midstream during a live auction because of lack of bids. I also remember financial markets seizing and supposedly strong public companies (including mine) worried about making payrolls. It will take more than a 20% pullback in the S & P to see a Burgundy wine collapse. Not saying it cannot happen, but other things will need to happen.

User avatar
blarmston
Posts: 577
Joined: February 24th, 2016, 10:18 am

Re: Will stock market collapse equal lower prices at wine auctions?

#52 Post by blarmston » February 29th, 2020, 9:26 am

Well, my clients pay me for that advice, but I will say:
* expect a relief rally as the markets are extremely oversold short term (five standard deviations from normal levels). Use that opportunity to reassess your beta exposure
* consider using tight stops on high flying positions.
* it’s okay to trim positions that have unrealized gains- there’s a full 14 months until the tax is due, and there will be chances to offset gains with losses
* the mega cap tech names that have grown to the sky will revert back, it’s already started. Take profits from this round and have dry powder for the start of the next nine inning ballgame. Because this particular game is late late innings.
* consider hedges if you don’t already own them. For example, use any short term sell off in gold to start building exposure there.
* the selling isn’t over so prepare now
That’s all I got, as I just got to Napa so I’m going into a 72 hour wine buzz, gitty up...
-Brian Armston

User avatar
blarmston
Posts: 577
Joined: February 24th, 2016, 10:18 am

Re: Will stock market collapse equal lower prices at wine auctions?

#53 Post by blarmston » February 29th, 2020, 9:39 am

blarmston wrote:
February 29th, 2020, 9:26 am
Well, my clients pay me for that advice, but I will say:
* expect a relief rally as the markets are extremely oversold short term (five standard deviations from normal levels). Use that opportunity to reassess your beta exposure
* consider using tight stops on high flying positions.
* it’s okay to trim positions that have unrealized gains- there’s a full 14 months until the tax is due, and there will be chances to offset gains with losses
* the mega cap tech names that have grown to the sky will revert back, it’s already started. Take profits from this round and have dry powder for the start of the next nine inning ballgame. Because this particular game is late late innings.
* consider hedges if you don’t already own them. For example, use any short term sell off in gold to start building exposure there.
* the selling isn’t over so prepare now. Use this weekend to take inventory of your holdings, and how they correlate with not only the entire portfolio but also the S&P, 10 year Treasury, and also MSCI World
That’s all I got, as I just got to Napa so I’m going into a 72 hour wine buzz, gitty up...
-Brian Armston

User avatar
Arv R
Posts: 3889
Joined: January 11th, 2015, 3:53 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#54 Post by Arv R » February 29th, 2020, 9:41 am

Wow it's like the old EF Hutton commercials....

R_@_0

A.Gillette
Posts: 1184
Joined: September 4th, 2009, 5:00 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#55 Post by A.Gillette » February 29th, 2020, 10:06 am

I don’t think the stock market and wine prices are correlated enough that a rapid decline in the former will lead to reduced prices in the latter within a short period of time. But a prolonged economic malaise, or recession, will undoubtedly lead to lower prices for luxury goods, wine included.

Right now, I don’t see fear or panic, despite the drop in the market. Rather, the drop seems like a reasonable attempt at reflecting lost corporate earnings that might result from reduced consumer spending in the event that the virus continues to spread. It will be interesting to see what happens when cases start to pop up in major US metropolitan areas. Is that priced in already? My bet is that when you start getting a lot of sick people in nyc, LA and San Fran (and couple that by a strong performance by a democratic candidate that’s seen as anti-business), and the markets could have pretty far to fall. At that point, I’m pretty sure I can find better things to spend money on than wine.
A
Last edited by A.Gillette on February 29th, 2020, 10:07 am, edited 1 time in total.
Alex

User avatar
Brady Daniels
GCC Member
GCC Member
Posts: 1979
Joined: April 17th, 2009, 7:24 am

Re: Will stock market collapse equal lower prices at wine auctions?

#56 Post by Brady Daniels » February 29th, 2020, 10:07 am

blarmston wrote:
February 29th, 2020, 5:14 am
Everyone has a plan until they get punched in the mouth- Mike Tyson

Every passive investor has a buy and hold approach, until they suffer a 25% drawdown in one month.
This approach has served me well for decades, including the tech crash and the financial crisis, both worse than your 25% scenario. Passive investing is remarkably low-stress, and rebalancing forces buying low and selling high. It also greatly reduces taxes and broker / fund fees. Thanks for your advice though.
-Brady D on CT - Omnivinovore

User avatar
Marcu$ Stanley
Posts: 1205
Joined: November 1st, 2010, 3:31 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#57 Post by Marcu$ Stanley » February 29th, 2020, 10:36 am

blarmston wrote:
February 29th, 2020, 9:26 am
Well, my clients pay me for that advice, but I will say:
* expect a relief rally as the markets are extremely oversold short term (five standard deviations from normal levels). Use that opportunity to reassess your beta exposure
* consider using tight stops on high flying positions.
* it’s okay to trim positions that have unrealized gains- there’s a full 14 months until the tax is due, and there will be chances to offset gains with losses
* the mega cap tech names that have grown to the sky will revert back, it’s already started. Take profits from this round and have dry powder for the start of the next nine inning ballgame. Because this particular game is late late innings.
* consider hedges if you don’t already own them. For example, use any short term sell off in gold to start building exposure there.
* the selling isn’t over so prepare now
That’s all I got, as I just got to Napa so I’m going into a 72 hour wine buzz, gitty up...
As a fairly routine type passive index retirement saver, what worries me is that the big indexes have become dominated by the “mega cap tech names” so are not as diversified as perhaps they should be. I can rebalance between equities and bonds but rebalancing the index itself would force me to be a more active investor than I want to be.

Re wine, I think this absolutely will affect wine prices below the top billionaire bait Burgundies. Wine prices have seen a big run up in the last year or two and are ripe for correction. In the short run there will be an asset price effect, in the medium to long run there are a lot of baby boomers out there with big cellars they won’t drink and their kids don’t really want.

User avatar
Jason T
GCC Member
GCC Member
Posts: 2318
Joined: June 8th, 2014, 7:45 am
Location: London

Re: Will stock market collapse equal lower prices at wine auctions?

#58 Post by Jason T » February 29th, 2020, 12:20 pm

blarmston wrote:
February 29th, 2020, 9:26 am
Well, my clients pay me for that advice, but I will say:
* expect a relief rally as the markets are extremely oversold short term (five standard deviations from normal levels). Use that opportunity to reassess your beta exposure
* consider using tight stops on high flying positions.
* it’s okay to trim positions that have unrealized gains- there’s a full 14 months until the tax is due, and there will be chances to offset gains with losses
* the mega cap tech names that have grown to the sky will revert back, it’s already started. Take profits from this round and have dry powder for the start of the next nine inning ballgame. Because this particular game is late late innings.
* consider hedges if you don’t already own them. For example, use any short term sell off in gold to start building exposure there.
* the selling isn’t over so prepare now
That’s all I got, as I just got to Napa so I’m going into a 72 hour wine buzz, gitty up...
No doubt that you’re a professional and good at what you do but again this advice is irrelevant to 99.999% of retail investors who would either not even know where to begin to implement the strategies or would implement them poorly. Enjoy Napa.
J@son Tr@ughber

User avatar
Jay Miller
GCC Member
GCC Member
Posts: 14610
Joined: June 19th, 2009, 5:18 pm
Location: Jersey City

Re: Will stock market collapse equal lower prices at wine auctions?

#59 Post by Jay Miller » March 1st, 2020, 5:41 am

jnbrown wrote:
February 28th, 2020, 7:11 pm
I don't know about wine, but there was a sale on stocks so I bought some.
I put in some low bids but didn't win anything.
Ripe fruit isn't necessarily a flaw.

Matthew.Rashbrook
Posts: 42
Joined: September 27th, 2017, 10:14 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#60 Post by Matthew.Rashbrook » March 2nd, 2020, 10:20 am

blarmston wrote:
February 29th, 2020, 5:14 am
Everyone has a plan until they get punched in the mouth- Mike Tyson

Every passive investor has a buy and hold approach, until they suffer a 25% drawdown in one month.

I hope every single person on this board is successful with their investment approach, I really do. But what I’m seeing out there, and what my firm is seeing out there, suggests it’s best to err on the side of caution. And a buy/hold approach and ‘buy the dip’ mentality works great, until it doesnt.
“It is difficult to get a man to understand something, when his salary depends on his not understanding it.”

Barry L i p t o n
GCC Member
GCC Member
Posts: 3053
Joined: November 8th, 2009, 8:59 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#61 Post by Barry L i p t o n » March 2nd, 2020, 10:33 am

jeff ostroff wrote:
February 29th, 2020, 8:42 am
DRC was strong both yesterday and this morning. 1999, 2005 and 2009 Rousseau Chambertin's just hammered above recent market highs. 6 bottles of 2002 Clos de Tart might be a new record.

Burgundy under card was very strong yesterday.

Live bids driving pricing higher.

Burgundy supply has been anemic since December 2019, especially 2010 and older. Tariffs exacerbating the issue.

Next weeks La Paulee auction should be a good test.

I am old enough to have had a draft card during Viet Nam War. Only auctions I can remember causing auction pricing to collapse were during the financial collapse of 2008. I remember Acker cancelling an auction midstream during a live auction because of lack of bids. I also remember financial markets seizing and supposedly strong public companies (including mine) worried about making payrolls. It will take more than a 20% pullback in the S & P to see a Burgundy wine collapse. Not saying it cannot happen, but other things will need to happen.
Thanks for the info. Any thoughts on the market for Giacosa red labels with age? The prices got so crazy that I’m thinking of selling the couple I have, and was wondering if that market is still a sellers market.

M Mager
Posts: 1252
Joined: June 1st, 2010, 3:19 pm
Location: Body in Seattle / Soul in Bosconia

Re: Will stock market collapse equal lower prices at wine auctions?

#62 Post by M Mager » March 2nd, 2020, 10:54 am

blarmston wrote:
February 29th, 2020, 5:14 am
Everyone has a plan until they get punched in the mouth- Mike Tyson

Every passive investor has a buy and hold approach, until they suffer a 25% drawdown in one month.

I hope every single person on this board is successful with their investment approach, I really do. But what I’m seeing out there, and what my firm is seeing out there, suggests it’s best to err on the side of caution. And a buy/hold approach and ‘buy the dip’ mentality works great, until it doesnt.
Oh, please... With all due respect, this ain't the first time at the rodeo for many of us. I started as a long-term investor on day one of my first job out of college. And I've continued to do so for more than 30 years. And over that time, I've been "punched in the mouth" more times that I can remember - black Monday, early 90s recession, dot-com bubble, post-9/11 market, Great Recession, etc. And, over that time, I watched a lot of people make really bad decisions trying to time markets and reacting with emotions. And, in the end, I have yet to see any data that shows -- for long-term investors -- they do any better than those who simply ride it all out. Those events really taught me the value of focusing on asset allocations decisions, and "buy/hold/rebalance" approach. At this point, I won't even bat an eye at a 25% drop in one month. Because the money I have in equity is intended for long-term use - 5, 10, 20 years down the road. By that time, such a drop will be nothing more than a big noise blip that won't have any impact on the long-term market signal.

As an aside, I do agree with you on the folly of "buy the dip". Simply another variant of market timing mindset. Have yet to see any data that shows it works any better over the long term than any other market timing strategies.
Michael

jeff ostroff
Posts: 70
Joined: June 6th, 2009, 9:17 am

Re: Will stock market collapse equal lower prices at wine auctions?

#63 Post by jeff ostroff » March 2nd, 2020, 12:55 pm

Barry L i p t o n wrote:
March 2nd, 2020, 10:33 am
jeff ostroff wrote:
February 29th, 2020, 8:42 am
DRC was strong both yesterday and this morning. 1999, 2005 and 2009 Rousseau Chambertin's just hammered above recent market highs. 6 bottles of 2002 Clos de Tart might be a new record.

Burgundy under card was very strong yesterday.

Live bids driving pricing higher.

Burgundy supply has been anemic since December 2019, especially 2010 and older. Tariffs exacerbating the issue.

Next weeks La Paulee auction should be a good test.

I am old enough to have had a draft card during Viet Nam War. Only auctions I can remember causing auction pricing to collapse were during the financial collapse of 2008. I remember Acker cancelling an auction midstream during a live auction because of lack of bids. I also remember financial markets seizing and supposedly strong public companies (including mine) worried about making payrolls. It will take more than a 20% pullback in the S & P to see a Burgundy wine collapse. Not saying it cannot happen, but other things will need to happen.
Thanks for the info. Any thoughts on the market for Giacosa red labels with age? The prices got so crazy that I’m thinking of selling the couple I have, and was wondering if that market is still a sellers market.
Barry, prices of 96 Giacosa red label lots were up at HD.

Sh@n A
GCC Member
GCC Member
Posts: 1307
Joined: July 9th, 2018, 8:21 am

Re: Will stock market collapse equal lower prices at wine auctions?

#64 Post by Sh@n A » March 2nd, 2020, 1:06 pm

No weakness for what I bid for at Acker HK or Zachy upcoming auction.
/ @ g r @ \

User avatar
blarmston
Posts: 577
Joined: February 24th, 2016, 10:18 am

Re: Will stock market collapse equal lower prices at wine auctions?

#65 Post by blarmston » March 2nd, 2020, 5:49 pm

Matthew.Rashbrook wrote:
March 2nd, 2020, 10:20 am
blarmston wrote:
February 29th, 2020, 5:14 am
Everyone has a plan until they get punched in the mouth- Mike Tyson

Every passive investor has a buy and hold approach, until they suffer a 25% drawdown in one month.

I hope every single person on this board is successful with their investment approach, I really do. But what I’m seeing out there, and what my firm is seeing out there, suggests it’s best to err on the side of caution. And a buy/hold approach and ‘buy the dip’ mentality works great, until it doesnt.
“It is difficult to get a man to understand something, when his salary depends on his not understanding it.”
Well, I’ll forgive your ignorance of what I do. And like I said, good luck to all out there.
-Brian Armston

Nick Gangas
GCC Member
GCC Member
Posts: 7436
Joined: August 7th, 2009, 6:27 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#66 Post by Nick Gangas » March 2nd, 2020, 6:20 pm

blarmston wrote:
February 29th, 2020, 5:14 am
Everyone has a plan until they get punched in the mouth- Mike Tyson

Every passive investor has a buy and hold approach, until they suffer a 25% drawdown in one month.

I hope every single person on this board is successful with their investment approach, I really do. But what I’m seeing out there, and what my firm is seeing out there, suggests it’s best to err on the side of caution. And a buy/hold approach and ‘buy the dip’ mentality works great, until it doesnt.
when over the long term has it not ?

User avatar
David_K
GCC Member
GCC Member
Posts: 877
Joined: July 17th, 2014, 7:01 pm
Location: Boston, MA

Re: Will stock market collapse equal lower prices at wine auctions?

#67 Post by David_K » March 2nd, 2020, 6:38 pm

blarmston wrote:
June 12th, 2017, 12:57 pm
Another fun fact- when the market finally takes its long overdue dump, I would bet there will be better and more plentiful deals to be had. Liquidity is king!
Dow as of June 12, 2017 = 21,235.67
Today even post last week's "dump" = 26,703.32

I think I'll ride it out.
K@ntrОwi╦z

Patrick Stella
Posts: 151
Joined: March 28th, 2012, 1:55 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#68 Post by Patrick Stella » March 5th, 2020, 3:04 pm

Nick Gangas wrote:
March 2nd, 2020, 6:20 pm
blarmston wrote:
February 29th, 2020, 5:14 am
Everyone has a plan until they get punched in the mouth- Mike Tyson

Every passive investor has a buy and hold approach, until they suffer a 25% drawdown in one month.

I hope every single person on this board is successful with their investment approach, I really do. But what I’m seeing out there, and what my firm is seeing out there, suggests it’s best to err on the side of caution. And a buy/hold approach and ‘buy the dip’ mentality works great, until it doesnt.
when over the long term has it not ?
Hey Nick,

Not trying to be rude or flip or anything, but it happens a lot. The only place it hasn't happened since the 30s is the US. The Nikkei is down roughly 40% today since its all time high in 1989. A Japanese investor has pretty much wasted a lifetime waiting to see profits, has never earned any, and is dealing with a 40% loss after 31 years of patience. There hasn't been much inflation I guess, but any that there has been makes it even worse. The CAC 40, the French stock exchange, looks like its down about 15% from an all time high in 2000.

The last 100 years in America has been an incredible age. But it isn't magic. Economic growth doesn't have to continue forever, and stock investors can push current prices to reflect ever more optimistic future growth assumptions in the current share prices. It's entirely possible the reality of the next, say, 20 years will be a disappointment relative to current expectations. The result could be stagnant or long term declining share values. The world has huge bets right now on future improved profitability at Amazon, Netflix, etc etc etc. Those improvements may never materialize.
ITB -- WineCredit LLC

M Mager
Posts: 1252
Joined: June 1st, 2010, 3:19 pm
Location: Body in Seattle / Soul in Bosconia

Re: Will stock market collapse equal lower prices at wine auctions?

#69 Post by M Mager » March 5th, 2020, 3:21 pm

Patrick Stella wrote:
March 5th, 2020, 3:04 pm
Nick Gangas wrote:
March 2nd, 2020, 6:20 pm
blarmston wrote:
February 29th, 2020, 5:14 am
Everyone has a plan until they get punched in the mouth- Mike Tyson

Every passive investor has a buy and hold approach, until they suffer a 25% drawdown in one month.

I hope every single person on this board is successful with their investment approach, I really do. But what I’m seeing out there, and what my firm is seeing out there, suggests it’s best to err on the side of caution. And a buy/hold approach and ‘buy the dip’ mentality works great, until it doesnt.
when over the long term has it not ?
Hey Nick,

Not trying to be rude or flip or anything, but it happens a lot. The only place it hasn't happened since the 30s is the US. The Nikkei is down roughly 40% today since its all time high in 1989. A Japanese investor has pretty much wasted a lifetime waiting to see profits, has never earned any, and is dealing with a 40% loss after 31 years of patience. There hasn't been much inflation I guess, but any that there has been makes it even worse. The CAC 40, the French stock exchange, looks like its down about 15% from an all time high in 2000.

The last 100 years in America has been an incredible age. But it isn't magic. Economic growth doesn't have to continue forever, and stock investors can push current prices to reflect ever more optimistic future growth assumptions in the current share prices. It's entirely possible the reality of the next, say, 20 years will be a disappointment relative to current expectations. The result could be stagnant or long term declining share values. The world has huge bets right now on future improved profitability at Amazon, Netflix, etc etc etc. Those improvements may never materialize.
I would love to see some research that indicates any active management strategy that can be shown with some reasonable probability of outperforming buy and hold strategy over any meaningful percentage of long-term periods.
Michael

Nick Gangas
GCC Member
GCC Member
Posts: 7436
Joined: August 7th, 2009, 6:27 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#70 Post by Nick Gangas » March 5th, 2020, 4:00 pm

Patrick Stella wrote:
March 5th, 2020, 3:04 pm
Nick Gangas wrote:
March 2nd, 2020, 6:20 pm
blarmston wrote:
February 29th, 2020, 5:14 am
Everyone has a plan until they get punched in the mouth- Mike Tyson

Every passive investor has a buy and hold approach, until they suffer a 25% drawdown in one month.

I hope every single person on this board is successful with their investment approach, I really do. But what I’m seeing out there, and what my firm is seeing out there, suggests it’s best to err on the side of caution. And a buy/hold approach and ‘buy the dip’ mentality works great, until it doesnt.
when over the long term has it not ?
Hey Nick,

Not trying to be rude or flip or anything, but it happens a lot. The only place it hasn't happened since the 30s is the US. The Nikkei is down roughly 40% today since its all time high in 1989. A Japanese investor has pretty much wasted a lifetime waiting to see profits, has never earned any, and is dealing with a 40% loss after 31 years of patience. There hasn't been much inflation I guess, but any that there has been makes it even worse. The CAC 40, the French stock exchange, looks like its down about 15% from an all time high in 2000.

The last 100 years in America has been an incredible age. But it isn't magic. Economic growth doesn't have to continue forever, and stock investors can push current prices to reflect ever more optimistic future growth assumptions in the current share prices. It's entirely possible the reality of the next, say, 20 years will be a disappointment relative to current expectations. The result could be stagnant or long term declining share values. The world has huge bets right now on future improved profitability at Amazon, Netflix, etc etc etc. Those improvements may never materialize.
point well taken Patrick. I was thinking specifically of the US market. Still I believe in the long term viability of it. As long as some morons don't f*ck it up that is.

David Kubiak
Posts: 93
Joined: May 8th, 2010, 12:56 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#71 Post by David Kubiak » March 5th, 2020, 7:00 pm

Not at all at the recent HDH auction.

A.Gillette
Posts: 1184
Joined: September 4th, 2009, 5:00 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#72 Post by A.Gillette » March 5th, 2020, 7:30 pm

Patrick Stella wrote:
March 5th, 2020, 3:04 pm
The Nikkei is down roughly 40% today since its all time high in 1989. A Japanese investor has pretty much wasted a lifetime waiting to see profits, has never earned any, and is dealing with a 40% loss after 31 years of patience.
While it’s true that if you’d only put money in the Nikkei right at the peak you’d still be in the hole, its a little misleading to say that a Japanese investor would be down 40%. If someone put the same amount into the Nikkei every year for each year since 1989, that person’s annualized rate of return would be 2.2%. That’s not an investment that would make me very happy, but it’s a lot better than down 40.
A
Alex

User avatar
blarmston
Posts: 577
Joined: February 24th, 2016, 10:18 am

Re: Will stock market collapse equal lower prices at wine auctions?

#73 Post by blarmston » March 5th, 2020, 8:04 pm

I will step back in and address a comment from earlier in this thread- about it not being the first rodeo for many, and how a buy/hold mentality has always worked well.

I can assume that since everyone’s first rodeo, they are 5-10-15-25+ years older. And a further assumption that retirement for each individual is now 25-15-10-5 years closer. Our psyche changes as we get older, and as the time when we begin to need to consider drawing down savings approaches. I don’t care if you have $5MM or $500K, if you are counting on using those funds to maintain ones lifestyle, you are more susceptible to the risk of suffering a permanent impairment of capital. And the possibility that you may not be able to recover from those losses, dramatically increases.

I could’ve chosen to spend the last five minutes of my life doing anything other than thinking about and typing this post, but I feel it’s my duty as someone who has a decent understanding of what is going on to utter some words of caution.

I hope I’m wrong, but this has the potential to be a black swan event that will hurt a lot of people. Be careful out there...
-Brian Armston

Patrick Stella
Posts: 151
Joined: March 28th, 2012, 1:55 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#74 Post by Patrick Stella » March 6th, 2020, 11:15 am

M Mager wrote:
March 5th, 2020, 3:21 pm
Patrick Stella wrote:
March 5th, 2020, 3:04 pm
Nick Gangas wrote:
March 2nd, 2020, 6:20 pm


when over the long term has it not ?
Hey Nick,

Not trying to be rude or flip or anything, but it happens a lot. The only place it hasn't happened since the 30s is the US. The Nikkei is down roughly 40% today since its all time high in 1989. A Japanese investor has pretty much wasted a lifetime waiting to see profits, has never earned any, and is dealing with a 40% loss after 31 years of patience. There hasn't been much inflation I guess, but any that there has been makes it even worse. The CAC 40, the French stock exchange, looks like its down about 15% from an all time high in 2000.

The last 100 years in America has been an incredible age. But it isn't magic. Economic growth doesn't have to continue forever, and stock investors can push current prices to reflect ever more optimistic future growth assumptions in the current share prices. It's entirely possible the reality of the next, say, 20 years will be a disappointment relative to current expectations. The result could be stagnant or long term declining share values. The world has huge bets right now on future improved profitability at Amazon, Netflix, etc etc etc. Those improvements may never materialize.
I would love to see some research that indicates any active management strategy that can be shown with some reasonable probability of outperforming buy and hold strategy over any meaningful percentage of long-term periods.
To be clear, I'm not saying more active trading would be better. I'm just saying there is no guaranty that long term passive equity returns have to be attractive. I agree active returns would be, all else equal, even worse due to higher fees.
ITB -- WineCredit LLC

Patrick Stella
Posts: 151
Joined: March 28th, 2012, 1:55 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#75 Post by Patrick Stella » March 6th, 2020, 11:19 am

A.Gillette wrote:
March 5th, 2020, 7:30 pm
Patrick Stella wrote:
March 5th, 2020, 3:04 pm
The Nikkei is down roughly 40% today since its all time high in 1989. A Japanese investor has pretty much wasted a lifetime waiting to see profits, has never earned any, and is dealing with a 40% loss after 31 years of patience.
While it’s true that if you’d only put money in the Nikkei right at the peak you’d still be in the hole, its a little misleading to say that a Japanese investor would be down 40%. If someone put the same amount into the Nikkei every year for each year since 1989, that person’s annualized rate of return would be 2.2%. That’s not an investment that would make me very happy, but it’s a lot better than down 40.
A
Alex, I'll take your word for it on the math, and your point is a good one. But of course however you make your investment, there are fees, you are trading to rebalance, etc etc. And in any case, I agree--2% is not what people are looking for out of long term nominal equity returns. ouch.
ITB -- WineCredit LLC

User avatar
Brent S
GCC Member
GCC Member
Posts: 104
Joined: August 8th, 2019, 9:59 am

Re: Will stock market collapse equal lower prices at wine auctions?

#76 Post by Brent S » March 6th, 2020, 6:43 pm

Heritage Auction going on now-I was outbid on everything. Most prices on what I bid on are close to where you can buy at retail.
Brent S

User avatar
mstockley
Posts: 455
Joined: April 9th, 2010, 12:48 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#77 Post by mstockley » March 6th, 2020, 7:59 pm

During the 2000 tech boom as the NASDAQ hit 5K I recall an analyst on CNBC cautioning that returns over the next 20 years would be flat. Turned out to be quite accurate.
M @ r k

Tom Reddick
GCC Member
GCC Member
Posts: 1411
Joined: June 30th, 2009, 9:56 pm
Location: Austin, TX

Re: Will stock market collapse equal lower prices at wine auctions?

#78 Post by Tom Reddick » March 6th, 2020, 11:31 pm

Last fall, as I have noted in some other threads, there was a very abrupt pullback of moderate impact on certain heavily traded cherries. It started with Giacosa, with Rousseau and DRC following suit.

So far with the start of the 2020 auction season, those price levels have held or slightly increased.

Champagne is on fire- especially Dom Perignon. Last year you could get 6 packs of 1996 Dom in almost any auction for $1,400 or less before BP. Now, when you can find them, bottles are hammering for as much as $300 each. That is a really significant move in so short a time for such a large production wine. And insider favorites like 1995 Taittinger are more dearly bought than ever before.

Beyond that- getting into things that are great and have some age on them, but are not strictly A-list, are showing great strength across the board. This includes things like Vega Sicilia, Soldera, 2008 first growths etc. There were deals to be had in this realm last year, but that is rapidly disappearing. There is just not the supply- either at auction or secondary retail- to keep up with demand.

Of course the coronavirus phenomenon threatens to change all of this- but it is too soon to know the full impact. I think we will know better in the next 2-3 weeks. If things appear to be getting contained- then it is back to business as usual and the prospects for Presidential elections will have the most significant impact on non-essential personal purchases as they always do in election years. If the virus continues to spread at or near current rates within the US- then the wine markets will be the least of our worries.

PS- with no offense intended to some of the posters, as someone who was on Wall Street, co-owned a trading firm, and was live on the front lines during the 2008 crisis and the year or so of abnormal trading activity that preceded it as well as the aftermath, the notion of what is going on now being a collapse or catastrophe makes me laugh a bit. Sure it is serious, and could potentially become very serious, but in the grand scheme of things this situation is not anywhere near crisis levels yet.
ITB - Cellar appraisals

ckirk
Posts: 32
Joined: March 4th, 2020, 8:29 am

Re: Will stock market collapse equal lower prices at wine auctions?

#79 Post by ckirk » March 7th, 2020, 3:34 am

Any change in buying, selling strategy after this up and down week on the market?
Craig Kirk [cheers.gif]

Brian Gilp
Posts: 2702
Joined: May 29th, 2010, 6:00 am

Re: Will stock market collapse equal lower prices at wine auctions?

#80 Post by Brian Gilp » March 7th, 2020, 6:47 am

Tom Reddick wrote:
March 6th, 2020, 11:31 pm
PS- with no offense intended to some of the posters, as someone who was on Wall Street, co-owned a trading firm, and was live on the front lines during the 2008 crisis and the year or so of abnormal trading activity that preceded it as well as the aftermath, the notion of what is going on now being a collapse or catastrophe makes me laugh a bit. Sure it is serious, and could potentially become very serious, but in the grand scheme of things this situation is not anywhere near crisis levels yet.
Even after what we saw in credit markets this week, you still don’t think things are very serious? I’m just a civilian and have never worked in the field but between repo, historic drops in UST yields across the curve, and gold action, it looks to me like there is a very major collateral concern. Throw in the slow down in new corporate bond issuance and it really looks like credit markets are at risk.

ckirk
Posts: 32
Joined: March 4th, 2020, 8:29 am

Re: Will stock market collapse equal lower prices at wine auctions?

#81 Post by ckirk » March 7th, 2020, 7:18 am

I just want to buy low and sell high:p lol
Craig Kirk [cheers.gif]

A.Gillette
Posts: 1184
Joined: September 4th, 2009, 5:00 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#82 Post by A.Gillette » March 7th, 2020, 7:26 am

Well, based on the last week it seems like the most likely outcome is that a bunch of people get sick. Seems like for a lot people it’s like a really terrible flu - you are completely out of commission for two weeks feeling awful. If you are elderly or have a health condition, or don’t have access to health care, then the consequences of getting it could be dire. Sounds like the virus may not like warm weather, so maybe it dies down naturally when summer arrives and then comes back again late in the year. Over the next 12-18 months therapies and vaccines start to appear. In the interim, it feels like we are headed for a major recession. People are going to reduce their level of commercial activity because they are fearful of interacting with one another. Travel, group gatherings, school, dining at restaurants, mass transport - all at drastically reduced levels. That’s going to affect a lot of people. People who price assets for a living are, for now, willing to only pay less than they were last week. Seems like there is further to fall as well and that worse before better is a decent bet. At some point, that turns into opportunity. But for now, I would think that the factors above would result in lower prices at some point over the next 6 months.
Alex

Mike R
Posts: 73
Joined: February 13th, 2020, 8:37 am
Location: NYC

Re: Will stock market collapse equal lower prices at wine auctions?

#83 Post by Mike R » March 7th, 2020, 7:41 am

Brian Gilp wrote:
March 7th, 2020, 6:47 am
Tom Reddick wrote:
March 6th, 2020, 11:31 pm
PS- with no offense intended to some of the posters, as someone who was on Wall Street, co-owned a trading firm, and was live on the front lines during the 2008 crisis and the year or so of abnormal trading activity that preceded it as well as the aftermath, the notion of what is going on now being a collapse or catastrophe makes me laugh a bit. Sure it is serious, and could potentially become very serious, but in the grand scheme of things this situation is not anywhere near crisis levels yet.
Even after what we saw in credit markets this week, you still don’t think things are very serious? I’m just a civilian and have never worked in the field but between repo, historic drops in UST yields across the curve, and gold action, it looks to me like there is a very major collateral concern. Throw in the slow down in new corporate bond issuance and it really looks like credit markets are at risk.
Deleting this post. Don't want to talk shop on the wine boards :)
Last edited by Mike R on March 7th, 2020, 12:09 pm, edited 1 time in total.
... 0 p 3 r

User avatar
R M Kriete
GCC Member
GCC Member
Posts: 572
Joined: April 27th, 2010, 8:07 am
Location: Indialantic, Florida

Re: Will stock market collapse equal lower prices at wine auctions?

#84 Post by R M Kriete » March 7th, 2020, 8:03 am

Gotta remember that the “death rates” people are freaking out over are actually quite inaccurate. They reflect the number of deaths divided by the number of patients who present as “sick”. The problem is, only the sickest people present for medical attention. The vast majority simply get a “cold” and recover without ever showing up at a doctor’s office.

So the real “death rate” needs to actually be calculated as the number of deaths divided by ALL people exposed to the virus. This turns out to be a much lower rate. In fact, when China started testing ALL of the population exposed to the virus, the death rate fell to 0.5%.... a rate of death quite similar to the flu.

A.Gillette
Posts: 1184
Joined: September 4th, 2009, 5:00 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#85 Post by A.Gillette » March 7th, 2020, 8:09 am

R M Kriete wrote:
March 7th, 2020, 8:03 am
Gotta remember that the “death rates” people are freaking out over are actually quite inaccurate. They reflect the number of deaths divided by the number of cases that present “sick”. The problem is, only the sickest people present for medical attention. The vast majority simply get a “cold” and recover without ever showing up at a doctor’s office.

So the real “death rate” needs to actually be calculated as the number of deaths divided by ALL people exposed to the virus. This turns out to be a much lower rate. In fact, when China started testing ALL of the population exposed to the virus, the death rate fell to 0.5%.... a rate of death quite similar to the flu.
I think people understand that but if you look at the mortality rate by age group then it appears that there are tremendous differences between this and the flu, and that for those who are elderly this is far more dangerous. And people are not just afraid of dying. Getting a terrible flu is awful in and of itself.
Alex

User avatar
R M Kriete
GCC Member
GCC Member
Posts: 572
Joined: April 27th, 2010, 8:07 am
Location: Indialantic, Florida

Re: Will stock market collapse equal lower prices at wine auctions?

#86 Post by R M Kriete » March 7th, 2020, 8:32 am

A.Gillette wrote:
March 7th, 2020, 8:09 am
R M Kriete wrote:
March 7th, 2020, 8:03 am
Gotta remember that the “death rates” people are freaking out over are actually quite inaccurate. They reflect the number of deaths divided by the number of cases that present “sick”. The problem is, only the sickest people present for medical attention. The vast majority simply get a “cold” and recover without ever showing up at a doctor’s office.

So the real “death rate” needs to actually be calculated as the number of deaths divided by ALL people exposed to the virus. This turns out to be a much lower rate. In fact, when China started testing ALL of the population exposed to the virus, the death rate fell to 0.5%.... a rate of death quite similar to the flu.
I think people understand that but if you look at the mortality rate by age group then it appears that there are tremendous differences between this and the flu, and that for those who are elderly this is far more dangerous. And people are not just afraid of dying. Getting a terrible flu is awful in and of itself.
Well, a 0.5% death rate from the flu, or from this virus, is 1 in 200 either way. Not sure why younger age groups dying from the flu is "better" than the elderly dying from this virus. Moreover, this virus does not cause flu symptoms, but rather cold symptoms that the majority of patients handle without even needing to see a medical professional.

Only pointing out that since 2010, the annual number of deaths in the US from the flu is between 12,000 and 61,000, yet our economy seems to get through it each year

A.Gillette
Posts: 1184
Joined: September 4th, 2009, 5:00 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#87 Post by A.Gillette » March 7th, 2020, 8:59 am

R M Kriete wrote:
March 7th, 2020, 8:32 am

Well, a 0.5% death rate from the flu, or from this virus, is 1 in 200 either way. Not sure why younger age groups dying from the flu is "better" than the elderly dying from this virus.
Well, you were talking about why people might be freaky out. My point was that the people freaking out might be much more likely to die from this than the flu. The distribution is probably more important than just the overall rate when you are talking about something where the overall rate is very, very low but the uneven distribution results in a considerable risk to some. If I told you that the overall death rate from shark attacks was minuscule, you’d probably feel differently about the risks on land than if you were swimming among great whites.
Alex

Brian Gilp
Posts: 2702
Joined: May 29th, 2010, 6:00 am

Re: Will stock market collapse equal lower prices at wine auctions?

#88 Post by Brian Gilp » March 7th, 2020, 9:08 am

Only pointing out that since 2010, the annual number of deaths in the US from the flu is between 12,000 and 61,000, yet our economy seems to get through it each year
65,000 deaths out of a 330M population is 0.0002. Breaks that up however you want for percent infected and CFR.

There are credible estimates that 40% or more of the population could get this virus. Use a 0.5% CFR and you get 0.002 or 10x the number of death as the seasonal flu.

Change assumptions as you want. The point being that CFR is only half the issue and percent infected the other.

Also, if the infections come as a wave there is the risk to overwhelm the hospitals which will raise the resulting CFR. So the transmission needs to be slowed down and that is where the economic hit is the most severe. Closing schools, businesses, cutting off travel and eating out, etc. It all adds up.

User avatar
R M Kriete
GCC Member
GCC Member
Posts: 572
Joined: April 27th, 2010, 8:07 am
Location: Indialantic, Florida

Re: Will stock market collapse equal lower prices at wine auctions?

#89 Post by R M Kriete » March 7th, 2020, 9:14 am

A.Gillette wrote:
March 7th, 2020, 8:59 am
R M Kriete wrote:
March 7th, 2020, 8:32 am

Well, a 0.5% death rate from the flu, or from this virus, is 1 in 200 either way. Not sure why younger age groups dying from the flu is "better" than the elderly dying from this virus.
Well, you were talking about why people might be freaky out. My point was that the people freaking out might be much more likely to die from this than the flu. The distribution is probably more important than just the overall rate when you are talking about something where the overall rate is very, very low but the uneven distribution results in a considerable risk to some. If I told you that the overall death rate from shark attacks was minuscule, you’d probably feel differently about the risks on land than if you were swimming among great whites.
I dunno. I would think that if the people most at risk are in the minority (elderly and chronically ill), then the majority of the population, who are not elderly and chronically ill, might take some comfort from the fact that this virus is not as dangerous to them.....and then this majority would not freak out. But with the media fanning the flames of panic, I suspect all reason and judgement left the building some time ago [wink.gif]

A.Gillette
Posts: 1184
Joined: September 4th, 2009, 5:00 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#90 Post by A.Gillette » March 7th, 2020, 9:21 am

R M Kriete wrote:
March 7th, 2020, 9:14 am
A.Gillette wrote:
March 7th, 2020, 8:59 am
R M Kriete wrote:
March 7th, 2020, 8:32 am

Well, a 0.5% death rate from the flu, or from this virus, is 1 in 200 either way. Not sure why younger age groups dying from the flu is "better" than the elderly dying from this virus.
Well, you were talking about why people might be freaky out. My point was that the people freaking out might be much more likely to die from this than the flu. The distribution is probably more important than just the overall rate when you are talking about something where the overall rate is very, very low but the uneven distribution results in a considerable risk to some. If I told you that the overall death rate from shark attacks was minuscule, you’d probably feel differently about the risks on land than if you were swimming among great whites.
I dunno. I would think that if the people most at risk are in the minority (elderly and chronically ill), then the majority of the population, who are not elderly and chronically ill, might take some comfort from the fact that this virus is not as dangerous to them.....and then this majority would not freak out. But with the media fanning the flames of panic, I suspect all reason and judgement left the building some time ago [wink.gif]
Perhaps. Most people I know have at least one loved one in a high risk group.

Also, if Coronavirus is spread through the airborne route, it seems like you have a much higher risk/rate of transmission. So to get to your similar death rate for flu and Coronavirus requires a very different set of social restrictions in order to reduce infection (in other words, maybe people are freaking out because quarantine sucks). But if you want to think of them as having the same overall death rate and therefore posing the same risk then I suppose that doesn’t seem crazy. It just seems like it ignores some very significant differences.
A
Alex

User avatar
alan weinberg
GCC Member
GCC Member
Posts: 12770
Joined: April 25th, 2009, 1:23 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#91 Post by alan weinberg » March 7th, 2020, 9:52 am

R M Kriete wrote:
March 7th, 2020, 8:03 am
Gotta remember that the “death rates” people are freaking out over are actually quite inaccurate. They reflect the number of deaths divided by the number of patients who present as “sick”. The problem is, only the sickest people present for medical attention. The vast majority simply get a “cold” and recover without ever showing up at a doctor’s office.

So the real “death rate” needs to actually be calculated as the number of deaths divided by ALL people exposed to the virus. This turns out to be a much lower rate. In fact, when China started testing ALL of the population exposed to the virus, the death rate fell to 0.5%.... a rate of death quite similar to the flu.
agree that the denominator is much bigger than so far demonstrated and thus the death rate lower, but a 0.5% death rate is about 5 times the flu death rate, there’s no vaccine for this, and transmission happens for days before one is symptomatic. Those are all facts that worry me.

User avatar
Neal.Mollen
GCC Member
GCC Member
Posts: 36482
Joined: January 30th, 2009, 1:26 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#92 Post by Neal.Mollen » March 7th, 2020, 11:10 am

blarmston wrote:
February 28th, 2020, 9:47 pm
Brady Daniels wrote:
February 28th, 2020, 8:41 pm
jnbrown wrote:
February 28th, 2020, 8:27 pm

I am the worlds worst investor, what ever I do the market does the opposite.
So expect a further plunge.
Index - Buy - Hold - Rebalance
Please check back in one month from now and let us know how that worked out for you... And don’t fib 😉
one month is not a relevant time horizon
I don't have to speak; she defends me

A drunkard's dream if I ever did see one

User avatar
blarmston
Posts: 577
Joined: February 24th, 2016, 10:18 am

Re: Will stock market collapse equal lower prices at wine auctions?

#93 Post by blarmston » March 7th, 2020, 11:20 am

Mike R wrote:
March 7th, 2020, 7:41 am
Brian Gilp wrote:
March 7th, 2020, 6:47 am
Tom Reddick wrote:
March 6th, 2020, 11:31 pm
PS- with no offense intended to some of the posters, as someone who was on Wall Street, co-owned a trading firm, and was live on the front lines during the 2008 crisis and the year or so of abnormal trading activity that preceded it as well as the aftermath, the notion of what is going on now being a collapse or catastrophe makes me laugh a bit. Sure it is serious, and could potentially become very serious, but in the grand scheme of things this situation is not anywhere near crisis levels yet.
Even after what we saw in credit markets this week, you still don’t think things are very serious? I’m just a civilian and have never worked in the field but between repo, historic drops in UST yields across the curve, and gold action, it looks to me like there is a very major collateral concern. Throw in the slow down in new corporate bond issuance and it really looks like credit markets are at risk.
It is certainly concerning what is going on right now; but as someone who works in the credit industry, this is definitely a much different feel than what happened in 2008. In 2008, there was real tension in the air when you left work on a Friday because you legitimately didn't know if your firm would open it's doors on Monday. Asset pricing for credit assets today are going up, not down, so there is no such immediate concern regarding liquidity right now.

There is much less leverage in the system now, and the underlying fundamentals and the US consumer are strong. While the outlook could certainly change if infections skyrocket, it seems like the most likely outcome is not going to cause a recession on its own. As long as there is a slower spread of the virus (similar to what has happened in China), and we don't start to see parabolic growth, it seems like we will be just fine economically until a vaccine is developed. I think a big reason markets are reacting the way they are is the complete ineptitude of our current administration, and a lack of confidence that enough will be done to contain the crisis.
Well, this right here is what makes markets. I'm not sure what part of the "credit industry" you are in. Credit cards? Mortgages? Middle market private banker originating corporate debt issuance?

There is a lot to unpack with your post, so here I go...

*different feel in the market- you are correct, there isn't widespread panic, yet. Up until two weeks ago, the markets were whistling by the graveyard with this outbreak. Then, it all changed. And now we are sitting on $9T in losses globally. Just think where we could be in another two weeks. There has already been a cascade of retail outflows, in both equities and credit. Corp bond, high yield, and leveraged loans are bleeding funds. With the rise of passive over the past 15 years, there are a lot of "investors" that will begin to sell, causing a "selling begets selling" aspect that is concerning. Investor positioning was at extreme levels, like I mentioned two a week and a half ago. That is still the case.
*asset pricing for credit assets today are going up, not down"- that is wrong. Treasuries and sovereign debt have caught a bid, yes. But the credit market (corp bonds, both "investment grade" and high yield, leveraged loans, etc) have begun to crack. Google credit spreads widening if you don't believe me. This is concerning because everyone knows that as the credit market goes, so goes the equities market. Or everyone should know that. If credit continues to weaken, then all the zombie companies cant refinance their debt, and its BK for them. That will be a good thing- maybe we can actually have a cleansing of the system and begin to write down this massive debt bubble that we are in.
*"there is much less leverage in the system now"- my god, I hope you are joking. There is MORE leverage in the system than ever before. Maybe the banks aren't levered as much (although with their derivatives cross exposure, they are, much more than 10 years ago), but everywhere else is. Corporates, sovereigns, households, its a massive debt bubble. This "recovery" from the GFC was fueled by ONE thing- massive debt expansion. Corporations have massively leveraged their balance sheet in order to buy back record amounts of their stock. If companies cant continue that trend (hint, they wont) then that steady source of buying demand vanishes.
*"the US consumer is strong"- I am trying to be polite, but again, wrong. The vast majority of Americans are struggling. Not the top 10% , they are juuuust fine. Americans have once again, collectively, borrowed record amounts of debt. Did you know that credit card chargeoffs are spiking? That subprime and now even prime car loans are defaulting or behind in payments at an accelerating level? Sure, mortgage rates have declined, and some people will refinance, and that will be a positive, but that stimulus wont last long. Just wait until banks begin to pull back from providing credit (hint, they already are). And just wait until employment gets hit (yesterday's job print is the high- mark my words). It's all downhill from here. Assuming that they dont cook the books with next month's report (they probably will), we will begin to see layoffs. And then consumer confidence will plummet. And when consumers arent confident? They dont take trips, they dont remodel the kitchen, they dont buy the new car, they drive the old one a few more years.
*" it seems like we will be just find economically until a vaccine is developed"- I need a drink after reading that. Even if a vaccine is found this afternoon, it will take at least a year for thorough testing and mass commercialization to be distributed globally. Just think about what that will do economically.
*"I think a big reason markets are reacting the way they are is the complete ineptitude of our current administration, and a lack of confidence that enough will be done to contain the crisis."
- something we can finally agree on...
-Brian Armston

User avatar
A. So
GCC Member
GCC Member
Posts: 2965
Joined: July 19th, 2011, 7:58 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#94 Post by A. So » March 7th, 2020, 1:31 pm

HDH last week, Zachys and HA the past day or two -- wine prices haven't seen the minor pullback that the markets have.
エaイdドrリiアaンn (93 pts.)

ckirk
Posts: 32
Joined: March 4th, 2020, 8:29 am

Re: Will stock market collapse equal lower prices at wine auctions?

#95 Post by ckirk » March 7th, 2020, 2:23 pm

blarmston wrote:
February 29th, 2020, 5:14 am
Everyone has a plan until they get punched in the mouth- Mike Tyson

Every passive investor has a buy and hold approach, until they suffer a 25% drawdown in one month.

I hope every single person on this board is successful with their investment approach, I really do. But what I’m seeing out there, and what my firm is seeing out there, suggests it’s best to err on the side of caution. And a buy/hold approach and ‘buy the dip’ mentality works great, until it doesnt.
Hopefully you’re not down 25% in a month. The market hasn’t dropped that far yet. Plus it was riding a wave hitting new highs so unless you just got in before the crashes then you should still be way up.
Craig Kirk [cheers.gif]

User avatar
blarmston
Posts: 577
Joined: February 24th, 2016, 10:18 am

Re: Will stock market collapse equal lower prices at wine auctions?

#96 Post by blarmston » March 7th, 2020, 3:55 pm

The fund flows that we see suggest that a lot of retail money came flooding in late Dec/early Jan. So unfortunately lots of Mom and Pops are probably sitting on losses. It makes sense, because they are always the last ones to the party, while the institutional money is quietly slipping out the back door... Right before the police crash the festivities...
-Brian Armston

User avatar
Thomas DeBiase
GCC Member
GCC Member
Posts: 96
Joined: February 17th, 2009, 4:28 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#97 Post by Thomas DeBiase » March 7th, 2020, 5:42 pm

blarmston wrote:
March 5th, 2020, 8:04 pm
I will step back in and address a comment from earlier in this thread- about it not being the first rodeo for many, and how a buy/hold mentality has always worked well.

I can assume that since everyone’s first rodeo, they are 5-10-15-25+ years older. And a further assumption that retirement for each individual is now 25-15-10-5 years closer. Our psyche changes as we get older, and as the time when we begin to need to consider drawing down savings approaches. I don’t care if you have $5MM or $500K, if you are counting on using those funds to maintain ones lifestyle, you are more susceptible to the risk of suffering a permanent impairment of capital. And the possibility that you may not be able to recover from those losses, dramatically increases.

I could’ve chosen to spend the last five minutes of my life doing anything other than thinking about and typing this post, but I feel it’s my duty as someone who has a decent understanding of what is going on to utter some words of caution.

I hope I’m wrong, but this has the potential to be a black swan event that will hurt a lot of people. Be careful out there...
Brian next time you find yourself in wine country, beers (or whatever the hell you want to crack from my cellar) is on me!
Thomas DeBiase
More Soul on this Train than Don Cornelius
I sell Idlewild wines by day, and run around like a drunk vigilante in Batman underoos by night.

User avatar
Mattstolz
GCC Member
GCC Member
Posts: 1864
Joined: June 26th, 2017, 7:46 pm
Location: South Carolina

Re: Will stock market collapse equal lower prices at wine auctions?

#98 Post by Mattstolz » March 7th, 2020, 5:43 pm

I have been wondering, as a total newbie to investing markets, everyone keeps saying "the fundamentals are strong" but how long does a company have to have its production facilities in china shutdown, its employees working from home, and its business trips cancelled and postponed before that's not something we can say anymore? isn't that the entire reason everyone is worried?

perfect examples, in my mind: DAL: good company, good fundamentals as far as I can tell... but how long can we say that with cancelled flights and free reschedules? MSFT: everything I can find basically assumes this is a fairly safe bet, but what about when they can't get processors made in china anymore? how strong are US fundamentals in general when we can't get any of our drugs anymore?

A.Gillette
Posts: 1184
Joined: September 4th, 2009, 5:00 pm

Re: Will stock market collapse equal lower prices at wine auctions?

#99 Post by A.Gillette » March 7th, 2020, 8:32 pm

blarmston wrote:
March 7th, 2020, 3:55 pm
The fund flows that we see suggest that a lot of retail money came flooding in late Dec/early Jan. So unfortunately lots of Mom and Pops are probably sitting on losses. It makes sense, because they are always the last ones to the party, while the institutional money is quietly slipping out the back door... Right before the police crash the festivities...
To be fair, if you are a retail investor that put a bunch of money into the market last December or January and you are freaked out by the current drawdown, you probably shouldn’t have been investing in equities.
Alex

User avatar
blarmston
Posts: 577
Joined: February 24th, 2016, 10:18 am

Re: Will stock market collapse equal lower prices at wine auctions?

#100 Post by blarmston » March 8th, 2020, 8:23 am

Well, I feel for the average investor, I really do. They have been seeing the parabolic rise in every asset class under the sun, for over a decade now. FOMO is a real thing folks. They see everyone getting rich (on paper), and they want in. I get it. And then you have Trump tweeting on a daily basis about the market, and even claiming that if you are ‘only’ up 50% in your 409K (can’t make that shit up) than you are somehow doing something wrong. It’s a reckless thing to do and most likely hurt a lot of people.

And then you have Federal Reserve policy (don’t get me started- it was/is a blatant wealth transfer from savers to speculators) and then you have TINA. Savers see their income from savings absolutely clipped, and they have no choice but to go out the risk/reward spectrum to grab yield, generate return and try and maintain some semblance of purchasing power.

ITS A f*ck JOKE- and it’s ALL coming home to roost now.
-Brian Armston

Post Reply

Return to “Wine Talk”