The Full English Accompaniment – Idle Speculation

The effects of COVID-19 have extended into all walks of life. Most of us have been distracted by the stock market crash, bare shops, lack of social contact and the spectre of death stalking the land. In the meanwhile the housing market has also been shuttered, with BoJo & Co telling people to delay house moves and cancel viewings until after it’s all over (1, 2). In an industry that was already wounded, these effects may be the death knell for staggering companies. The post-COVID-19 probate boom looks a long way ahead. Not that any of this matters, since companies like Halifax/ Lloyds and Barclays are pulling their mortgage products (3, 4). Staffing rather than liquidity apparently. Though the use of repayment holidays and the inability to survey property for pricing is definitely going to feed into it (5, 6). Like most things in these uncertain times, we’re not going to know the truth of it until we’re out of the crisis zone.

In such times speculation reigns supreme. We turn to ‘experts’ for advice on the stock market (7). Misunderstanding, misinterpretation of the facts and conspiracy theories are spreading. During the first 4 weeks of January 2020 there were over 15 million Twitter posts on the topic (8). Those posts are unlikely to give a balanced view of the science. To quote Joana Gonçalves-Sá and her Nature Medicine commentary:

“Overall, it is possible that people sharing such misinformation overestimate their ability to understand very complex problems and might be experiencing a form of the Dunning-Kruger effect, which states that people are often more confident than they are knowledgeable. This may be exacerbated by a lack of trust in institutions, be they governments, the pharmaceutical industry, or the traditional media.” (8)

Our old friend the Dunning-Kruger Effect. The argument to explain Trump. We’re unaware of our overconfidence when we should be demonstrating intellectual humility. The world is full of cognitive blind spots (9).

Image Credit: (9)

Social media is the vector in the viral spread of disinformation (8, 10). I really love this tongue-in-cheek article on Medium, framing it as DKE-19 (10).

“Signs of DKE-19 generally appear 3–5 days after learning that the word “epidemiology” is not the study of skin diseases…

DKE-19 is in the same family of misinformation viruses as the one that caused the b00m3R-FB outbreak in 2016. It is transmitted person-to-person through a variety of means, including listening to/repeating bullshit while on the toilet (“feco-aural transmission”), and sharing dirty tweedles.” (10)

Image Credit: (10)

The amount of misinformation out there is frankly staggering, so don’t contribute to it. Engage social media distancing. Pick relevant and trusted providers. As a starter, try Richard Lehman’s weekly round up in BMJ Opinion (11). Tomas Pueyo’s excellent The Hammer and The Dance, with 10 million views, is a longer explanatory piece (12). As for day to day updates, if you really fancy pushing your knowledge meddit has a daily Megathread for COVID-19 discussing the latest science – here’s the 28th/29th (13). The subreddit is for medical professionals only and layperson questions/ comments will be deleted. It’s heavily moderated, and layered in medic-chat. You likely need a medic on tap just to wade through our acronyms/ slang/ approach, but the discussions of the latest science and data are detailed and there’s some amazing views from the frontline. Choose your sources wisely, and cut the crap.

Keep handwashing, and take care!

The Shrink

…

COVID-19:

I’m sorry but the economy doesn’t work like a blood sacrifice, the gods don’t grant a bull market just because you condemn hundreds of thousands of people to a painful death

— Patrick Wyman (@Patrick_Wyman) March 24, 2020

• Opinion piece in the Guardian on Trump reopening the economy (14)
• The NY Times has this amazing interactive graph where you can impose restrictions and watch the effects on deaths (15)
• And Trump continues to go balls deep for the economy, announcing that he will not penalise companies who break emissions laws (16)
• But the lockdown is having beneficial effects on emissions in Europe (17)
• IMF chief says we’re in a recession, and how we manage COVID-19 will dictate the recovery (18)
• Good news in the UK, with predictions that with current efforts we will have enough ICU beds (19)
• And locally we’re seeing stadiums converted into field hospitals in preparation for the coming surge (20)

Life goes on:

• The FTSE sees a 16.5% rally, but is it a rally or more volatility? (21)
• And people are turning to grow their own food, clearing out seed stockists and snapping up poor quality allotments (22)

Comment/ Opinion:

• Vox has a wide ranging and pretty balanced take on FIRE (23)
• Phillip Inman in the Observer asks will this be another Great Depression? (24)
• Financial Samurai has these great confessionals from the bear market (25)
• AWOCS is looking at the effect it will have on retirees (26)
• And has advice for those who are experiencing their first market crash (27)
• The UKVI is looking at the potential impact on dividends (28)
• The Psy-Fi Blog looks at the anchoring effect in bear markets (29)
• Ermine has a sidelong glance across the board (30)
• TEA on the benefits of having a plan (31)
• Banker on Fire looks for the positives (32)
• I posted this last week, but FirevLondon’s play by play really is an eye opener (33)
• Sam has some simple lessons (34)
• Indeedably, on bitcoin (35)
• And he’s also keeping a daily journal of isolation life (36)

References

1. https://www.theguardian.com/business/2020/mar/26/housing-market-frozen-by-government-during-coronavirus-lockdown
2. https://www.bbc.co.uk/news/business-52051174
3. https://www.theguardian.com/money/2020/mar/26/halifax-withdraws-majority-of-mortgages-coronavirus
4. https://www.financialreporter.co.uk/mortgages/barclays-withdraws-almost-all-mortgage-products-above-60-ltv.html
5. https://www.thisismoney.co.uk/money/mortgageshome/article-8147909/Should-mortgage-hold-three-months.html
6. https://www.ft.com/content/c08ec3d9-079e-40ff-baae-11388c650f6c
7. https://www.thisismoney.co.uk/money/investing/article-8138239/What-investments-markets-fall-Five-financial-gurus-respond.html
8. https://www.nature.com/articles/s41591-020-0802-y
9. https://www.vox.com/science-and-health/2019/1/31/18200497/dunning-kruger-effect-explained-trump
10. https://medium.com/@noahhaber/flatten-the-curve-of-armchair-epidemiology-9aa8cf92d652
11. https://blogs.bmj.com/bmj/2020/03/23/richard-lehmans-covid-19-reviews-23-march-2020/
12. https://medium.com/@tomaspueyo/coronavirus-the-hammer-and-the-dance-be9337092b56
13. https://www.reddit.com/r/medicine/comments/fqkf3g/megathread_covid19sarscov2_march_28th29th_2020/
14. https://www.theguardian.com/commentisfree/2020/mar/27/can-us-reopen-economy-coronavirus
15. https://www.nytimes.com/interactive/2020/03/25/opinion/coronavirus-trump-reopen-america.html
16. https://www.theguardian.com/environment/2020/mar/27/trump-pollution-laws-epa-allows-companies-pollute-without-penalty-during-coronavirus
17. https://www.bbc.co.uk/news/science-environment-52065140
18. https://www.cnbc.com/2020/03/27/imf-chief-georgieva-says-the-world-is-in-a-recession-containment-will-dictate-strength-of-recovery.html
19. https://www.newscientist.com/article/2238578-uk-has-enough-intensive-care-units-for-coronavirus-expert-predicts/
20. http://www.cardiffandvaleuhb.wales.nhs.uk/news/52357
21. https://www.thisismoney.co.uk/money/markets/article-8157781/Stock-markets-fight-FTSE-100-16-5-3-days.html
22. https://www.independent.co.uk/environment/grow-food-coronavirus-urban-allotments-fruit-vegetables-a9431051.html
23. https://www.vox.com/the-highlight/2020/3/18/21182018/financial-independence-retire-early-fire-early-retirement-mr-money-mustache-pete-adeney
24. https://www.theguardian.com/business/2020/mar/21/100-years-on-another-great-depression-coronavirus-fiscal-response
25. https://www.financialsamurai.com/fire-confessionals-in-a-bear-market/
26. https://awealthofcommonsense.com/2020/03/how-does-the-market-crash-impact-retirees/
27. https://awealthofcommonsense.com/2020/03/surviving-your-very-first-market-crash/
28. https://www.ukvalueinvestor.com/2020/03/coronavirus-impact-on-dividends.html/
29. http://www.psyfitec.com/2020/03/anchors-weigh.html
30. https://simplelivingsomerset.wordpress.com/2020/03/27/of-natural-beauty-and-interesting-markets/
31. https://theescapeartist.me/2020/03/27/the-inestimable-advantages-of-having-a-plan/
32. http://bankeronfire.com/finding-gratitude-in-challenging-times
33. https://firevlondon.com/2020/03/21/the-worst-crash-in-history/
34. https://asimplelifewithsam.com/2020/03/21/ten-simple-living-ideas-during-covid-19/
35. https://indeedably.com/predictive/
36. https://indeedably.com/i-note/