Wednesday, July 29, 2020

Equity Set Up

My sense is that after some time; that is, after some more hurting from corporate earning’s reports that are much less than stellar, is that once we hit another equities bottom, and especially when we get a Covid-19 vaccine, then there will be a lot of upside potential to the stock market. 

The reasoning on this is that those companies that will have survived this pandemic time will have been forced to survive not only with loans and Federal Reserve corporate bond buying, but also via their own thinning of employees to essential workers.  The same goes for their processes.  By being force to re-think the efficiency of their businesses to have survived what is commonly called, “unprecedented times,” there will be a baked in efficiency to their businesses that will allow for much greater profits once things start to lift again. 

That said, there is the potential for a equity shit-storm still with regard to possible spikes in the pandemic, especially heading into the fall and winters months when people really do tend to get sick anyways.  And again, it’s anyone’s guess what will happen until Moderna, Pfizer, Inovio, or any other of hundreds of companies trying to figure out a vaccine are able to get through the various phases of testing and human trials and is actually able to market a successful drug to kill off and avoid this virus.  

Image:
https://www.fiercepharma.com/pharma/moderna-s-rumored-50-plus-price-covid-19-vaccine-draws-ire-as-company-touts-new-animal-data