COVID-19 & Straits Times Index

Okay, I’ll stop being a bitch and just vomit out what is on my mind.

1) The infection numbers are going to explode in the USA. Gonna overtake China by the end of the week if testing capabilities isn’t bottlenecked. Should hit past 1M by the end of April.

2) People are grossing and massively underestimating (a) how quickly this issue will resolve itself and (b) the economic impacts of it directly and (c) the future downstream impact as society itself changes.

3) This “crash” is NOT a buying opportunity YET. It is just 1 month into this bear market ffs!

4) A lot of business models are shit and most stuff on the SGX are pure trash that should really be cleansed out by an economic recession, even some of the blue chips. Buying them “because they are cheap” but without consideration how they will operate profitably and with an edge 5-10 years down the road will be a mistake that many will make.

5) On the other hand, there are certain sectors that will likely completely rebound when this whole crisis is over and will be hitting pre-COVID numbers in 2022 and beyond. Those are the kind of things that you’d want to be in.

6) Business environment will change rapidly and I think a lot of the commercial office space REITs are gonna get smashed hard and may never fully recover as BCP is showing that companies might not really need to rent AAA office space for…. whatever reasons they have.

7) USDSGD might go well up to 1.6 or 1.8

8) Opportunity will be for anyone that has NOT already started panic buying the “crash” and has ammo to buy the blood when the bad news finally peak.

9) When the time comes, consider using CPFIS if you have got that liquidity to spare.

10) Probably a terrible idea to be buying private property as an investment – massive liquidity requirements, terrible friction of both time and cost to exit, tiring as an asset to make it productive. Unless you’re an expert and are particularly looking to flip it eventually for the capital gains, I doubt that it would make sense to looking for firesale property unless you do have prior expertise and its a market you are intimately familiar with. To expand – it’s not that it is a bad market, but you’d probably get bested by the industry insiders with the liquidity to make the best moves.

I have more things on my mind, but I think the main points are that (a) FX risks is not being managed, (b) this is way too early in the crash to be buying stuff and (c) liquidity is king and will be what allows to even enter opportunities later.

Personally, I’ve managed (a) and (c) by keeping a sizable chunk of USD in BlockFi and just eating 8.6% pa. Even if we were in a bull market, eating 8.6% by sitting in cash is a pretty freaking good deal. It is an even more amazing deal in a bear market and a strengthening dollar. Just something to keep in mind.

When the time comes, I am prepared to either (a) YOLO even more into crypto or (b) yoink back out my USD from BlockFi back to my local bank account in SGD and start buying the local blood.

If REITs on average aren’t pushing 10%++++ on pre-COVID earnings, I’m not even gonna bat an eyelid, haha.

Good luck out there people, as your favorite Uncle Warren loves to say, it is finally time to see who’s been out there swimming naked.