I had a look at that interview you posted. I was underwhelmed by Siegel, and the whole show reeked of political motives. But I feel I should give some background to my recent activities and why I have acted in this way.
I think it is important to distinguish between two important factors. V itself and the effect V will have on the economy as governments try to control it.
V itself is probably a bit easier to evaluate. I myself believe the virus is grossly underdiagnosed an hence its true mortality rate in the developed world is currently being significantly overestimated. I believe it is highly contagious, and because of its apparent long incubation period it will spread very effectively unless draconian isolation measures are used. And let's face it, no one else will be able to do what the Chinese did with respect to locking people in their homes and ensuring those people complied. So as far as I am concerned, it will go everywhere, including Australia. How many people will die its hard to say, but probably not enough to produce a significant economic downturn.
The secondary economic impact as governments shut down industry, etc is likely to be far, far greater imo than the direct impact of the virus itself. And more prolonged. Apparently China will not open factories at least until April. It is this that is the biggest threat to the market imo.
Sure, in the long term this will be another blip on the graph. And all the major companies I held will survive and flourish. But in the short term I see a significant downside. TCL, TLS, banks, etc will still be around in ten years time, running tolls, giving out loans and paying dividends to shareholders. But over the next six months, I believe there is a high chance many of these companies will be significantly cheaper than they are today.
I also felt the need to rebalance my holdings. There were things I wanted to buy, and things I probably was too heavily invested in. I had large CGT gains, but also carried large GCT losses. There were stocks I wanted in different accounts. So, given this, and all of the above I saw the opportunity to do a hard reset. Clean everything out, and start again in a more controlled and systematic fashion. Bit like a massive spring cleaning exercise.
So yes the world will not end. In the long term the market will rise.
And now the plan is, at a certain point which is yet to be determined, to start buying back my kids, in an orderly fashion, in the right amounts and the right accounts for me. And if I am lucky, I might be able to buy them back cheaper. As you know, you make more of your money when you buy than when you sell.
So when do I start the buyback? Not sure, but not yet. That is the hard part, but I will keep you posted.
