Wednesday 1st April 2020

We’re now at 4,800 cases and 21 deaths in Australia. Globally there are 857,500 cases and 42,107 deaths as of midday today.

There’s another statistic that’s rarely reported, the number of people whom have made a full recovery from COVID-19. It’s in the 1000’s! In Italy, I believe a 101yo male made a full recovery from it and he made it through the Spanish Flu and every other pandemic, depression, recession, war and crisis we’ve had over the past 100 years.

The DOW went down 1.6% over night.

Talked to a friend in Sydney today, he’s now officially unemployed. It’s nothing to do with COVID-19, he’d planned to change jobs. long ago. The problem is his new job cannot put him on right now.

He was also telling me a friend of his, who owns a bunch of commercial, industrial and residential real estate has tenants in all of his properties that either need rent reductions or are no longer paying rent. Plus his job is on hold until at least July 1st with no pay. He’s got plenty of equity so I guess he’ll be ok.

 

Thursday 2nd April 2020

Australia has ticked over 5000 cases now and has 21 deaths. US President Trump over night apparently projected numbers and deaths from COVID-19 and the markets (DOW, S&P500 and NASDAQ) all finished 4.4% down for the day.

I’m surprised at how much fear the media has been able to instil in different pockets of society. They’re having a field day. Now it’s time to focus on the opportunities that are present and the opportunities that will present with time.

What these are I’m not entirely sure, yet.

NSW and Victoria are in their ‘lockdown’ excluding shopping for essential items until 29th June. I’m guessing QLD will be next.

There’s plenty in the investment media about UK banks not paying dividends this year. Also retail businesses Nick Scarli and Harvey Norman have announced their not paying dividends (which is no surprise considering the pause on retail business activity during this lockdown).

Our big four banks here in Australia are probably the four most solid banks in the world, so will be interesting to see what they do. Westpac who’ll be the next to declare a dividend in May will be the litmus test. Particularly with the legal trouble and law suits their fights at this moment.

CBA yesterday paid their interim dividend of $2 that amounted to $3.5 billion dollars back to shareholders. xxx and xxx got nice pieces of that. I did too, though indirectly. 

Whatever happens, the most important thing is the bank (and all listed businesses) ensure their balance sheet is strong and they innovate/adapt to remain profitable long term. Use this crisis as an opportunity to reset to a learner, meaner and stronger business model. That’s priority number one.

Shareholder’s will want to extract a return whether it’s via:

1. Companies paying dividends

2. Companies doing share buybacks

3. Companies reinvesting into their business

4. Companies paying down debt

5. Companies acquiring new businesses (and therefore profits)

The first option above is probably the one I enjoy most, however I’m under no illusion options 2-5 are equally fantastic options and the net result will be basically the same, just that you’d have to sell some shares, equivalent to say 3% of the holdings, and manufacture a dividend during the year. Easy. 

With this known and clear, it’s business as usual in terms of investing.

Today xxx was around to train to stretch and train in they gym. I told him about the UK banks briefly. He asked me if I got a surprise $100,000 would I still invest it now. I said 100% I would. I’d DCA in over the next 3-12months. What ever happens short term (next 1-5 years), day always comes after night and if I was to be fortunate enough to come into that type of money in these times, I’d have no hesitation investing it and letting the compounding increase at lower prices than 3 months ago.

I’m guessing he was using my answer as a barometer for if he should be worried or not. Though his investment horizon is different to mine and his sequence of returns risk is potentially a small issue, he's in a fantastic position whatever happens in the market. 

 

Friday 3rd April 2020

As of 6am this morning there are 5224 cases in Australia and 23 confirmed deaths. Globally we’re at 980,000 cases and 50,200 deaths.

The DOW finished up 2.4% over night and the media here in Australia is all about further lock down and wartime preparations for businesses.

xxx called me this morning worried after listening to the media that all dividends from companies will be stopped. Fucking media…

Explained this is not the case, most companies will continue to pay dividends and rightfully companies that are struggling wont, because we want to ensure they’re around for the long hall first and foremost. Once this is established they can go back to paying dividends.

A physical prep client who works for a big four accounting firm, told me today the firm laid off 200 people and gave everyone who’s on more an $62,000/year a 20% pay cut for the next three months. The partners took a 36% pay cut for the same period. Good to see the partners leading by example.

 

Saturday 4th April 2020

5454 cases and now 28 deaths in Australia. Globally there are 1,076,000 cases and 58,000 deaths so far.

The DOW closed 1.6% down overnight.

It’s clear to me, having multiple streams of income is an absolute necessity in life now. I’d hate to rely on one income stream without quick access to a large amount of cash or liquid equity.

Something else now evident are the challenges of globalisation, because when shit hits the fan it’s every country for themselves. The European Union is not as united as the countries in need, within that union, may have initially thought.

For me the future of that union is on thin ice moving forward despite what lip service and posturing we’re exposed to in the future.

As a result of this, each country around the world will become more self-dependent on essential needs. This will be a key mandate moving forward once this is over.

 

 

Monday 6th April 2020

5795 confirmed cases and39 deaths as of 3pm today in Australia, while globally 1,275,000 cases and 69,000 deaths.

The curve here in Australia is certainly flattening out. Today’s new cases saw just over 100 where as in late March we had a day of over 450 new cases. This is fantastic news.

There’s still a lot of talk of long term lock downs. The Spit, Surfers Paradise beach and Greenmount/Coolangatta beaches here on the Gold Coast are now officially closed. I’m not sure why as we’re closer to the end than the beginning of this...

The mainstream media is incredibly negative and draining, so I avoid it. I’ve talked to a few people today and yesterday who voluntarily shared with same views.

A couple of my USANA customers drive Taxi’s, both are no longer driving, there is no demand. 

The ASX was all green today, up 4.5% in general. There’s a lot of talk around another significant downward fall in asset prices. I used to buy into that but now, while I can see the case for it; I know I have no idea what’s to come. Will continue to stick to my plan.

Had a good chat with xxx today about what’s happening and what he’s seeing and thinking. He’s fortunate, his work has not been impacted, nor has his wife’s. His wife recently changed jobs and went without pay for around 6 weeks. He told me she got paid (a half pay) for the first time today. I suggested they live on one wage and invest the other (either via buying shares and/or paying down their home loan faster). Hopefully they do this. It’ll help the enormously in the following decade.

 

Tuesday 7th April 2020

The DOW up 7.7% over night.

COVID cases in Australia are now totalling 5844 with 42 deaths.

Flight Centre have closed 248 stores permanently and put off 100’s of staff. Their shares have been suspended on the ASX for the past 3 weeks and their doing a capital raising around the $7 mark (shares last traded around $9.40 three weeks ago) and getting more access to more debt to improve their liquidity.

ASX was up in the AM and finished down in the PM. No shortage of volatility at the moment.

 

Wednesday 8th April 2020

The DOW down overnight roughly 0.1%.

The RBA (Reserve Bank of Australia) kept interest rates on hold for this month (they meet first Tuesday of each month except Jan) and suggested rates will be at current level for at least the next 3 years. They also expect a significant contraction this quarter they expect their buying of government bonds to slow down as the economy recovers. At the moment the RBA is buying $3 billion dollars of bonds on the secondary market daily.

Essentially this is what has put a ‘floor’ for lack of a better word under the share market. Until they started doing that, people who panic were selling both shares and bonds going straight into cash. Once there was liquidity in the bonds market (a buyer for every seller so to speak), I’m guessing people felt ‘safe’ to move into and/or keep their bonds because there were plenty of buyers (the RBA) for them.

Currently there are 5908 cases of COVID-19 and 45 have died. More than 310,000 tests have been carried out across Australia and new daily cases as of yesterday were 109.

Global statistics are 1.3 million cases and 74,800 deaths.

 

Thursday 9th April 8, 2020

Overnight the DOW went up 3.4% and the ASX closed 3.4% in the green also.

6103 cases of COVID-19 in Australia and 51 deaths. Globally there are 1.4million cases and 88,000 deaths.

There’s lots of talk around companies cutting or withholding dividends, especially the banks. APRA released this capital management document yesterday: https://www.apra.gov.au/capital-management

The key point for me was:

“During this period, APRA expects that ADIs and insurers will seriously consider deferring decisions on the appropriate level of dividends until the outlook is clearer. However, where a Board is confident that they are able to approve a dividend before this, on the basis of robust stress testing results that have been discussed with APRA, this should nevertheless be at a materially reduced level. Dividend payments should be offset to the extent possible through the use of dividend reinvestment plans and other capital management initiatives. APRA also expects that Boards will appropriately limit executive cash bonuses, mindful of the current challenging environment.”

Very interesting!

A mate, who has created incredible wealth in the past 15 years from nothing, sent me a few emails around the ‘this time it’s different’ theme and he’s bullish on gold and crypto currency’s, specifically for the reasons of protecting his purchasing power due to inflation he believes is coming from the stimulus packages and money printing.

I'm also focused on protecting my purchasing power over time. This is the primary reason I invest, other than the passive income it provides (which is currently reinvested into buying more shares).

Inflation is not well understood by most. It’s bites away at our purchasing power over time, if ignored. It’s a key to building and growing wealth and a better life financially.

Got an email from my Super fund today. It informed member’s calls to the call centre are up 270% above typical call rates over the past two weeks! Over 90,000 calls! People are clearly freaking out! Hopefully they are not going to cash…

 

Friday 10th April 2020

1.5 million cases globally and 93,400 deaths. Here in Australia we’ve had 6152 cases and 52 deaths.

The DOW was up 1.2% over night.

Had a great chat today with xxx who's profession is economic modelling but more than that, he’s a long time investor who understands the value of passive income from assets and multiple streams of income.

He mentioned to me that people with debt are screwed. He’s rarely negative. I asked him to explain further. He said anyone with debt and income that’s been compromised or has creditors that cannot pay for services already provided, is in for a world of hurt.

Further, he suggests due to the government intervening (specifically freezing mortgage payments, not allowed to expel tenants, harder for companies to become insolvent, etc. He was supportive of the Job Keeper and Job Seeker schemes though) they end up with ‘debt overhang’, meaning once everything goes back to ‘normal’ (whatever normal is) most people will still be hanging on to the crippling debt they couldn’t manage in tough times. This makes the financial system more fragile and prone to falling over the next event we encounter.

Instead, a better solution for the financial system to make it anti-fragile (more solid and robust) as Nassim Nicholas Taleb would say, is for people to sell down their assets at discounted prices, repay their debts and start again fresh with no debt. This resets asset prices and helps people move forward, start fresh without any debt overhang pinning them down. This makes for a robust, healthy financial system and I reckon healthier and happier people too.

The same thing happened after the GFC in 2008-2009. There was incentive for people to hold on to their assets and they came out of the GFC with debt overhang, instead of getting ride of the asset, paying down the debt and starting fresh, making the financial system anti-fragile and their own balance sheet far stronger.

I need to keep this concept in front of mind, as at some point, the gravity of the situation will overpower any government intervention/stimulus. That will be an enormous transfer if/when that occurs.

I also asked him about the potential for inflation, with all the money coming into circulation. He suggested in the next 6 months inflation would most likely drop and doubts we’ll get inflation from the money their printing. This is because this money will be going towards living expenses, savings and paying down debts and expenses. Inflation happens, when the amount of goods and services is fixed and then more money that comes into the system, this results in inflation.

 

Saturday 11 April 2020

Beautiful day on the Gold Coast today. Went for a surf down at Miami as my ‘essential exercise’. As I was exiting the water a reporter and camera man from Channel 7 News was on the boardwalk attempting to interview people at the beach.

Interestingly, not one person accepted their offer to be interviewed and as I watched for 20mins and walking past them back to my car I overheard the reporter say to her cameraman ‘this is getting more difficult. No one wants to talk’.

It made my day! I’m guessing people are sick and tried of the mainstream media making up rubbish and sensationalising the smallest detail. I’m disgusted in most journalism today.

6238 COVID cases in Australia as of today and 54 deaths in total and globally we’re at 1,670,000 cases and 101,500 deaths.

 

Sunday 12th April 2020

This times it’s different.

I’ve read and heard when you hear people start saying those four words, its time to invest and go in hard. Interestingly, I’ve heard those four words from a few close friends in the past few days. Coincidence? I don’t know. But I found it intriguing they’ve come to this conclusion and all are investors, business owners and smart people financially and in life.

It makes me wonder, am I being naïve? Is this time really different? The last thing I want to be right now is arrogant and/or close-minded.

Personally, I don’t think it’s different this time. One the surface level, yes it may appear that way. However underneath the bonnet, it’s the same as it’s always been. Too much debt, too many people living beyond their means and not enough savings, no matter which way people want to spin it.

6289 cases in Australia and 57 deaths. They've done a fantastic job containing the spread here in Australia. Globally we’re at 1,750,000 cases and 107,500 deaths. The exponential nature of the spread now hitting the USA. I’ve heard number of deaths in New York alone the past couple of days of 700+ and 900+. Lets see how bad it gets over here. From all I’ve heard and read, the USA was fairly late to the isolation/lockdown party.

 

Monday 13th April 2020

More disgust today, this time around the World Health Organisation’s behaviour. It’s at the point now the USA and United Nations are considering with holding funding to the WHO moving forward.

Also government medical officials, not once have I heard encouragement around people supporting their immune system via exercise, exposure to the sun, eating nutrient dense food, using daily supplements, etc.

This can only be gross negligence on their behalf. The message being transmitted to the public is incredibly fear based with not one hint of empowerment at any point. Crazy...

6322 total cases and 61 total deaths. Keep in mind these are cumulative numbers, since yesterday there’s been just 21 new COVID-19 cases in Australia. This is the site I go to for this data https://www.health.gov.au/news/health-alerts/novel-coronavirus-2019-ncov-health-alert/coronavirus-covid-19-current-situation-and-case-numbers#across-the-world

Globally, we’re at cumulatively number of 1.83 million cases and 113,200 cumulative deaths.

 

Tuesday 14th April 2020

6366 cumulative COVID cases and 61 total deaths in Australia. There have been 44 new cases in Australia in the past 24hours. That’s around 90% down from our peak a few weeks ago according to my numbers.

Globally, total cumulative cases are 1.9 million and 118,400 deaths.

 

Wednesday 15th April 2020

Talked to xxx this morning, she shared a couple of interesting situations with me. One, her landlord’s income has been cut by 30% ($700/wk). With two mortgages to pay (PPoR and Invest property) this is having a real impact on their (him and his wife’s) cash flow. He’s going to get $20k out of his super to help with cash flow. I understand this if it’s an absolute last resort, but at 41yo with compounding it comes with a significant opportunity cost.

Next are her Osteopathic friends, a married couple who are Osteo’s in a small quiet town in NSW. They have a clinic that is now closed, as the town is full of elderly people who are staying at home. Fortunately their landlord is giving them 3 months rent-free. Plus they are pausing their mortgage payment for a month, basically having a holiday from everything for the month.

I hope they learn to create at least another stream of income and make sure it’s online without a large overhead. This is essential moving forward. In my opinion it’s too risky not too.

Cumulative cases in Australia now 6416 and still at 61 deaths, globally we’re now at 1.97 million cumulative cases and 125,000 deaths.

REIQ for tenants relief package was released today. To say it’s the unfair and inequitable would be an understatement. Here are a few bullet points:

-       Tenants can get full rent waiver for 6 months, while landlord can’t ask for any proof of financial hardship

-       Landlord insurance will not cover losses

-       Tenants can break lease with just 7 days notice and can refuse entry to the landlord

-       Lease agreement automatically extended 6 more months

Absolute insanity! This will not last. It cannot last…

 

Thursday 16th April 2020

Total cases to date are 6458 and total deaths siting at 63, while globally cases are at 2 million and deaths are 133,000.

Talked at xxx today, he told me an electrician he was talking to who works in Brisbane said there’s hundreds of empty rooms in buildings that house overseas students all of the city. He as thinks the tail on this will get bad once the 6 months of government payments stops and businesses open back to less demand than before COVID.

Financial author and planner Noel Whittaker posted a couple of interesting things. Firstly the USA is allowing $100,000 to be taken out from their superannuation (401K’s in imagine) but it must be paid back within 3 years otherwise it’s treated as taxable income.

Also the WWE (World Wrestling Entertainment) company has cut over $4 million dollars of costs per month from their operations via athlete layoffs, reducing executive and board member compensation, deferred spending, etc.

Today our Prime Minister addressed the nation about exiting this crisis. A couple of interesting comments I picked up were the 6 months of support are the June and September quarters. Also, these ‘stage 3 lockdown measures’ are likely to remain at lest another 4 weeks. This will help ensure COVID cases remain on the decline permanently. It will also ensure businesses and employment struggle exponentially more, in my amateur opinion.

Speaking of struggling, Virgin Australia airline is apparently days away from going into receivership, unless they get $1.4 billion dollar cash injection. The government has already said they wont bail them out because Virgin is essential foreign owned, but if Virgin disappears Qantas will have a monopoly on the Australian Airline industry.  Interesting time ahead. Plus selfishly, I’m a Velocity Member with Virgin, so I'm rooting for them to pull through. I can’t go back to not having lounge access!

I’ve also had a few questions from people in relation to investing. It seems investing in more popular than in prior decades, but also that I seem to be getting a range of questions.

I’ve added a blog to my www.kdmhealth.com website to work on my writing skills primarily and also to add value. Will next post my 2009 article on time, money and coaching.

This will become a focus during this time too add more value to people in my circle, plus people buy from people they know, like and trust, which is also part of the goal to continually improve in these area’s. 

The DOW was down 1.86% over night and the ASX closed down 0.9%.

 

Friday 17th April 2020

The DOW closed up 0.14% over night. In other news some big listed businesses are coming undone.

Let’s start with Crown; the James Packer backed casino’s in Melbourne and Perth. They’ve laid off 11,500 of their 12,000 employees now and this does not include the 6,500 contractors (security and the like) they are not longer hiring. Plus they’ve secured $1 billion dollars of debt to keep them afloat.

K-mart (Westfarmers business) is temporarily closing three of its stores in QLD, NSW and VIC turning them into fulfilment centres as online demand surges and physical shopping decreases. Great to see them adapting. Apparently all staff has been retained and will fulfil different roles.

Seek (the list online job ad business) listings are down 33.9% in job ads for the month of March compared to the same period in 2019. However this figure jumped to 68.6% drop for the week ending 12th April, compared with the same week last year.

Talked to a client today about the proposed continuance of stage 3 lockdown for four more weeks. He couldn’t believe it. He suggested it’s going to do so much damage to our economy and will scare so many people, it’s just crazy.

Why not re-open restaurants and cafes with strict social distancing enforced. Opening businesses in cities and regions where there have been no COVID-19 cases in a week or two.  He suggested the medical advisors are going to come of looking stupid become of their over reaction into their lock down advice. All the while our economy is being compromised more than needed.

I tend to agree.

6523 total COVID-19 cases thus far and 65 deaths in Australia and globally we’re at 2.1 million cases total and 145,000 deaths.

The ASX finished up 3.5% today. 

 

Saturday 18th April 2020

The DOW went up 3.5% over night.

Updating a couple of things in my www.sharesight.com account I noticed my xxx and xxx holdings are in the green and another one is incredibly close. The others are now only around 10% down on average.

I don’t want to give the impression that short-term price movement of shares matter – especially the way I invest, it’s irrelevant. That said, it’s interesting to see the values start to reflate as the COVID curve flattens out. What’s interesting to me is the daily news of businesses, companies, etc. shutting down and the tail this is going to have, while the market doesn’t seem to mind or is forward looking past all of this.

Just today I see the QLD government offered $200 million to Virgin Airlines to stay afloat. The Australian Cricket Coach Justin Langer has been dropped to part time working just two days per week, while all essential staff have been laid off until June 30th and on just 20% of their original income. Also Cricket Australia has approx. $90 million dollars invested in local and global share markets (instead of cash like the AFL and Rigby League). The drop in the share market has obviously eroded their available cash, but you also need to understand that had they kept their funds in cash, they might have had a lot less than even now, because leaving capital in cash is wealth destroying.

An article in the Australian newspaper today stated a $16 million dollar loan to Rugby Australia would only service their existing debts. Seems like RA is not in a good position.

The flow on effects of this are enormous but either the market has priced this in or I’m getting ahead of myself. Either-way, I invest as if I know nothing these days (which is true!). As a net buyer of equities when I have excess funds I invest. I don’t play the timing game or pretend to know what the market will do in the coming days, weeks and months. What I do know (or at least I believe will continue) is human endeavour will continue to improve and I’ll own a progressively larger slice of this via the public markets, that will protect my purchasing power against inflation (in other words wealth should grow much faster than inflation) and return a wonderful growing passive income stream for life (that’s currently reinvested to accelerate the compounding).

Total AU cases 6533 and 67 deaths while globally we’re at 2.2 million cases and 150,000 deaths.

 

Sunday 19th April 2020

In the news today the Brisbane Bronco’s NRL Rugby League team has cut 22 employees, it’s CEO took a 50% pay cut ($300,000), it’s head coach and all senior coaching staff a 20% cut and it’s board a 75% cut.

In other news apparently Sweden isn’t offering anyone over 80yo medical support. I’ve not confirmed this, but did hear it in the media.

I woke early this morning so listened to a podcast with former boxing world champion Jeff Fenech who spoke about his health challenges (heart valve and memory). Two things struck me. Firstly, his focus and value of good health and independence as he ages after the experience he’s had. It’s interesting, that until we actually experience something, our opinion isn’t as accurate as it might otherwise be. And secondly, the clear direction he has around protecting boxers from gym wars, concussions and brain trauma. It’s impressive to hear him speak up about.

Cases in Australia at 6586 and 69 deaths while global cases are 2.3 million and 158,000 total deaths.

 

Monday 20th April 2020

6612 total cases in Australia and 70 deaths thus far, while globally we’re at 2.38 million and 164,700 deaths.

Today received quarterly distributions from VAS and VGS ETF’s. Both were automatically reinvested to purchase more shares, VAS at the price of $64.1653 per unit and there’s no brokerage. Considering it was around the $91 mark a couple of months ago, I’m good with the DRP situation.

The only thing I’m not wrapped about is have hold xxx in two separate entities, meaning on one entity I have $30.84 cash surplus and the other at $56 cash surplus. Meaning at a DRP of $64.1653 I’m missing out on an extra share and all the future compounding it’ll do. Instead I’m stuck in cash until the next distribution is paid in mid July. As you can see, cash isn’t always great to have; especially with a long term investment horizon would much prefer those funds invested in the market. In the scheme of things, it’s first world problems though.

xxx told me yesterday the QLD government has changed the tenants support rules. This was no surprise considering how terribly one sided they were. I also hope the person/s or committee who knocked up the original one, were permanently relieved of their positions within government. Disgraceful is an understatement.

Some of the changes are a removal of the ban on homeowners clawing back rental discounts from their tenants. Also tenants would now need to prove they had lost 25% of their income due to COVID-19 or were spending more than 30% of their income on rent and could not afford basic necessities such as food, to be eligible for protection under the eviction moratorium.

The ASX closed down a full 2% today.

Tonight Virgin Australia Airlines has caved and gone into voluntary administration. I’m disappointed. Was working towards Platinum Status and now it’s all over!

In all seriousness, it is a tragedy as 10,000 workers incomes have been cut to zero. I doubt it’s totally over yet, but they’ve been knocked down for an eight count.

Also heard the NRL CEO Todd Greenburg has ‘voluntarily’ stood down from his position and will be replaced.

 

Tuesday 21st April 2020

The DOW closed down 2.4% and oil at negative rates for the first time in history! That’s right. Producers have nowhere to store it and demand has dropped enormously, so they’re paying to give it away. What a time to be alive!

6625 cases and 71 deaths in Australia to date while globally were at 2.45 million and 168,500 deaths.

The ASX also had a down day, this time 2.5%. Prices are getting back closer to what I bought for at my best prices yet. Fingers crossed it continues.

 

Wednesday 22nd April 2020

The DOW closed down 2.67% and the S&P500 and NASDAQ down over 3% each.

While cases of COVID19 are dropping here in Australia the economic bad news is ramping up. KPMG came out saying the economy could take 10 years to fully recover and the RBA (Reserve Bank of Australia) recently stated this will be the biggest economic contraction since the 1930’s (the Great Depression) and unemployment will most likely remain over 6% for a long time.

In good news after ANZAC day (this Saturday) restrictions around elective surgery will be lifted.

Ramsey Health (RHC) today announced a capital rising of $1.2 billion dollars. They also announced they’re suspending dividends temporarily. This leaves SOL (Washington H Soul Paterson) as the only company to increase dividends every year over 20 years on the ASX. RHC is high capital costs to run, debt and has been meaningfully impacted the shutdowns, so it’s prudent decision making on their behalf. On the other hand SOL has zero debt, fantastic cash flow businesses and plenty of cash to invest during this time. They recently announced their interim dividend, which was up (again) from their previous years interim dividend. 

Australian cases are at 6647 and 74 deaths while globally we’re at 2.5 million and 171,000 deaths. I messaged with an Italian friend who currently lives in the USA today. She said Italy is getting better and her mum, who’s a nurse, gets tested every 3 weeks for COVID19.

 

Thursday 23rd April 2020

The DOW closed up 2% over night. Lots of changes in the past 24hrs, in bullet points:

-       The Australian Government invested $94 million (this is to store it all) to buy oil at a fantastic time while companies are paying to give it away, to take our back up supply from 30 days and move it closer to 90 days in case of another global disaster. It’s FANTASTIC to see the behaviour change already!

-       Our PM Scott Morrison is pushing for new World Health Organisation, via withholding funding to the current one and starting a fresh. This is also FANTASTIC news!

-       Australian business Radio Rentals has shout down permanently due to this crisis

-       This morning I was getting a blood test done at QML and heard the receptionist discussing QML asking all staff work for free for a week. She nearly broke down in tears hearing the news. When getting my blood drawn, I asked the technician a few questions in relation to the business of QML. He said only 8 clinics are open of more than 30 that typically are as people were too scared to come in.

-       Elective surgery’s are now open to resume after ANZAC day

-       The NRL (National Rugby League) is due to resume May 28th, though the QLD based teams will need special permission from QLD Government to cross the boarder regularly otherwise the teams will have to be based in NSW until state travel restrictions are lifted.

-       I jumped on twitter tonight and saw the PM Scott Morrison said the Job Seeker payments would drop back to their original amounts after this pandemic is over. Well… there’s a strong train of though that those payments should stay doubled and instead take money from franking credits that the ‘rich’ (their words not mine) and another apparent solution is the Australia government just keeps printing money to ensure those no working get a permanent pay rise. Interesting times…

My mate in Sydney called me yesterday. The boss from the company he just left (in the surfing industry) asked him to go back to work for him. Insane considering he just started a new position in a new company less than two weeks ago. But such is the value he’s able to bring to a business.

He also told me his wife is still being paid only for two days of week per week but actually working 5 days a week. It seem there’s no shortage of people prepared to work for less income now to ensure future employment and income.

Current cases are 6654 and 74 deaths with 5012 people recovered from COVID19. Globally it’s 2.6 million cases and 182,000 deaths.

 

Saturday 26th April 2020

ANZAC Day today. Lest we forget. With no large group gatherings allowed, this is the first year since 1919 (101 years!) that ANZAC day will be celebrated without marches, dawn service and two up later in the day. I was awake at 5:20am this morning and up, to pay my respects to who sacrificed.

But I didn’t stand in the driveway with a candle. I sat out the back on my patio and enjoyed the dawn, the quiet and the stillness in silence with a ton of gratitude.

The DOW finished up 1.1% today.

Of the 6,675 confirmed cases in Australia, 78 have died and 5,136 have been reported as recovered from COVID-19. More than 482,000 tests have been conducted across Australia. Globally, we’re at 2.7 million cumulative cases and 190,000 deaths attributed to COVID19.

xxx came around to train today. We had a good chat about his portfolio and the economy. Seems he’s keen to rejig his holdings to add a little international via divesting one of his banks and an LIC starting with M. I think this is a good move.

xxx called me yesterday to talk about getting rid of his personal insurances. He’s paying for them and in a financial position that he doesn’t need them, if something terrible was to happen. We discussed the in’s and out’s. In the end he’s keeping one of K’s and one of his but lowering the amount for the next few years while their girls are still in school.

 

Sunday 27th April 2020

Announcement of relaxation of lock down in QLD and WA today, meaning we can go for a drive with a 50km radius of where we live and if you have a jet ski or boat you can now use it for recreational purposes.

 

Monday 28th April 2020

Australian cases at 6713 and 83 cumulative deaths while globally we’re at 3 million cases and 205,300 deaths.

NAB cut dividend to $0.30cents down from $0.83 cents and halted trading to undergo a $3 billion dollar institutional capital rising. They also unexpectedly bought forward their half-year announcement by about 10 days. Guessing they wanted to get first move advantage over the other two banks due to report in the next few weeks. Guessing we’ve got more of this to come.

Had a mate message me today about the news of NAB halting trading and cutting dividends. He also said he was going to take his money out of the bank.

I explained that listed companies often halt trading to do institutional capital raising. Ramsey Health Care (RHC) did it last week, raising $1 billion dollar in a day, while in a trading halt before resuming trading and offering retail investors a share purchase plan for the remaining $200 million.

Westpac (WBC) also did the same thing in December last year.

I also explained that cutting and/or not paying dividends is a smart move in these times for many businesses. While it’s going to hurt shareholders who’ve been relying on high bank dividends for many years, that’s the risk of a narrow investment focus. Plus in my opinion, these businesses have been paying out too much for too long, neglecting to reinvest capital back into the businesses. Now NAB’s payout ratio is something sustainable I’m guessing.

ASX finished up 1.2% today.

 

Tuesday 28th April 2020

The DOW closed up 1.5% and the ASX ended up closing today flat.

Australian COVID19 cases now at a totalling 6725 with only 12 new cases since 6am yesterday and a total of 84 deaths. Globally, 3 million total cases and 210,000 deaths.

There’s plenty of excitement around in relation to WA and QLD implementing the first stage of relaxing the lockdown.

I messaged a friend today who’s into investing and owns investment property. Asked what she’s noticing. She said 95% of people are not able to deal with a loss of income for more than a couple of weeks and people she knows with investment property cannot afford to keep them at the moment.

 

Wednesday 29th April 2020

The DOW closed down 0.13% over night.

Yesterday The Australian (newspaper) reported that 33% of companies on the ASX 300 have withdrawn earnings guidance since COVID19. That’s 200 companies or 66% of companies that have not or a yet too.

It went on to say there’s been (so far) 35 capital raising for a total of $15.4 billion dollars, between March 18th and April 27th. This is (again, so far…) just 15% of the $100 billion dollars raised during the GFC. With the time frames being so different (the GFC is now a known time period while this is still unknown) it’s tough to know what this data and behaviour means.

On the retail front, the chain Target is in trouble with owners Westfarmers (WES) starting earnings have decreased significantly. I think they’ve been on the slide for a while now and this maybe the nail in the coffin.

Today the ASX closed up 1.5%.

In Australia more relaxation of lockdown happening in other states and total cases at 6746 and deaths attributed to COVID19 are 89. Plus if I recall accurately, we’ve had no COVID cases here in Queensland for a week now.

Globally, 3.1 million cases and 217,000 deaths.

 

Thursday 30th April 2020

DOW closed up 2.2% after more great results from USA based companies. This time it was Microsoft and Telsa. Yesterday it was Alphabet.

The first Australian news I got was ANZ (one of the big 4 bank in Australia) is deferring its interim dividend. Last year it paid an $0.80cent fully franked dividend. This year they’ll continue to monitor and make an announcement in August.

Fortunately I don’t own any banks directly and even more fortunately I don’t need the dividends they pay at this time. At some point down the track I might and it’s provided a wonderful lesson for me.

We live in a global village, more so now than ever and there’s incredible businesses that are taxed in the USA for example, that operate and generate income all over the world, such as Microsoft, Alphabet the parent company of Google and YouTube, Apple, Amazon, Warren Buffett’s company Berkshire Hathaway and the list goes on. It makes sense to own a piece of them as a form of diversification at minimum. Other than owning them directly, ETF's like VGS (fee of 0.18%) or IVV (fee of 0.04%) are options. Both are domiciled in AUD and can be bough on the ASX.

There’s plenty of love for Vanguards VTS (0.03% fee) which is the total USA share market, but it’s domiciled in USD and we need to fill out a W8-Ben form. Not a big deal though. 

For further diversification or tilting options like VAE (Asia minus Japan), VGE (Emerging markets), IJR (US Small Caps) or IJH (US Mid Caps) exist as do a slew of others. Like unlisted property trusts and even things like Bitcoin and different crypto's if you're that open minded.

Talked to one of my best mates this morning that works as a draftsman, now from home, for a large engineering company. He told me the company is in stage 1 of a potential 3-stage plan based on their revenue’s dropping. Cuts to staff, to wages and things like 4-day work weeks may come into play.

I got a phone call yesterday from an athlete I trained about 18 years ago who works for a large building company. He said they all got a 30% pay cut plus the company lay off a couple hundred employees if I heard correctly.

Heard the Northern Territory will basically re-open everything in the next week or two as they have as close to zero COVID19 action possible.

6753 cases and 91 deaths thus far in Australia as of today and globally we’re at 3.1 million cases and 227,000 deaths.

The ASX closed up 2.4% today.