Covid-19

[opmi]

Seems like the stories I heard about insurance agents doing brisk business during this period is true!

I wonder if term insurance premiums have risen during this period.

 I am also wondering if general insurance like travel, worker comp premiums will go up after crisis? Like Buffett said about competition in the insurance business.

[Behappyalways]

World food security at risk as exporters curb sales, importers buy more
https://www.reuters.com/article/us-healt...1D0YV?il=0


India's poorest 'fear hunger may kill us before coronavirus'
https://www.bbc.com/news/world-asia-india-52002734

[weijian]

This is probably 1 of the more meaningful action that the Gov has announced today, with regards to VBs looking at the business environment.

Resilience Budget: S$20b allocation for loan capital to support companies

The government is setting aside S$20 billion of loan capital in the Resilience Budget to support companies amid the novel coronavirus pandemic, Deputy Prime Minister and Finance Minister Heng Swee Keat said on Thursday.

This will help support the good companies with strong capabilities and catalyse private sector loan capital, Mr Heng said during his speech in Parliament.

He added that the government will provide help where the credit needs are more acute, given the situation is fluid.

https://www.businesstimes.com.sg/governm...capital-to

[soros]

The latest figures of deaths due to virus posted by scmp website on 26 March 2020 ( 24 Mar 2020 ) are :

Italy : 7,503 (6077)
Spain : 4,089 (2696 )
Iran : 2,234 (1934)
France : 1,331 ( 860 )
USA : 857 ( 525 )
UK : 422 (335 )

All above figures are still rising.

[holymage]

Singaporeans who think that their favourite REITs' current dividend yields are high (if they can be considered high at 6-7%), need to think thrice. Most retail REITs have a higher F&B composition compared to historic mix due to retail sales moving online. F&B are undoubtedly having cashflow issues and Singapore economy is dependent on tourism (4% of GDP). F&B owners will definitely demand rental reduction from landlords to relief business pressure, else they will close shop. Recovery in footfall will not be immediate after this pandemic, as most likely we are in a global recession now, just that it has yet to be reported officially. Expect earnings cuts and dividend cuts to come. Needless to mention industrial and hospitality REITs.

The impact to retail REITs is worse than I imagined. Footfall definitely will not recover in the months to come. Will banks give property owners a pass? And what will be the impact to banks' balance sheet.

The virus situation will definitely improve, as history has shown. No doubt about that. With many countries now uptight and implemented social distancing measures.
The concern would be the severity of economic impact aftermath.
________________________________________________

The Cheesecake Factory, one of the most popular sit-down restaurant chains in the country, says it will not be able to make upcoming rent payments for any of its storefronts on April 1 because of significant loss of income due to the coronavirus crisis.

The Calabasas Hills-based company informed all of its landlords in a letter dated March 18 (reproduced below) that a severe decline in restaurant traffic has decreased its cash flow and “inflicted a tremendous financial blow” to business.

In telling landlords that it will not able to pay rent, the Cheesecake Factory essentially confirms that it is in the same position that many independent restaurateurs currently find themselves in.

https://la.eater.com/2020/3/25/21194144/...restaurant

[opmi]

Singaporeans who think that their favourite REITs' current dividend yields are high (if they can be considered high at 6-7%), need to think thrice. Most retail REITs have a higher F&B composition compared to historic mix due to retail sales moving online. F&B are undoubtedly having cashflow issues and Singapore economy is dependent on tourism (4% of GDP). F&B owners will definitely demand rental reduction from landlords to relief business pressure, else they will close shop. Recovery in footfall will not be immediate after this pandemic, as most likely we are in a global recession now, just that it has yet to be reported officially. Expect earnings cuts and dividend cuts to come. Needless to mention industrial and hospitality REITs.

The impact to retail REITs is worse than I imagined. Footfall definitely will not recover in the months to come. Will banks give property owners a pass? And what will be the impact to banks' balance sheet.

The virus situation will definitely improve, as history has shown. No doubt about that. With many countries now uptight and implemented social distancing measures.
The concern would be the severity of economic impact aftermath.
________________________________________________

The Cheesecake Factory, one of the most popular sit-down restaurant chains in the country, says it will not be able to make upcoming rent payments for any of its storefronts on April 1 because of significant loss of income due to the coronavirus crisis.

The Calabasas Hills-based company informed all of its landlords in a letter dated March 18 (reproduced below) that a severe decline in restaurant traffic has decreased its cash flow and “inflicted a tremendous financial blow” to business.

In telling landlords that it will not able to pay rent, the Cheesecake Factory essentially confirms that it is in the same position that many independent restaurateurs currently find themselves in.

https://la.eater.com/2020/3/25/21194144/...restaurant

Look at what happened in China for the future.

[holymage]

Level 1 thinking would be to refer to China for the future, and assume China vs the Rest of World to be somewhat similar.

While the trend of virus outbreak and recoveries can be modelled from China, some patterns in consumer habit might (?), I doubt that the overall economy can be assumed in a similar manner.

Here are why:
1) A substantial percentage of China's economy is dependent on state-owned enterprises, while the US is much more privatized. In high probability, the CCP will bail those state-owned enterprises to ensure continued employment and no social unrest, especially when there is a widespread dissatisfaction over the CCP's handling of this crisis.
2) China banks are known for doing national service and the CCP controls China banks directly. This is unlike US-privatized banks that might halt lending if there is significant credit risks.
3) China previously had a supply issue of labour and goods, but is now experiencing a demand issue as the Rest of World has postponed or cancelled orders from China. There are numerous reports of returning workers experiencing retrenchment when the nationwide quarantine is over.

[opmi]

I am taking a simplistic (maybe naive) view that people will revert to their old behaviours over time....especially after 2-3 months...

[weijian]

I am taking a simplistic  (maybe naive) view that people will revert to their old behaviours over time....especially after 2-3 months...

For some of us, we need to have more affirmative views and act upon them so that it can help us to reach the mountain-top earlier. That is, we need to be more proactive and affirmative.

But for you, probably you are already on the mountain top and you can be more reactive and probabilistic

Getting rich and staying rich are 2 different skill sets and mentality.

[money]

I am taking a simplistic  (maybe naive) view that people will revert to their old behaviours over time....especially after 2-3 months...

i take the same view too, habits arent that easy to change. 

But i have started to realise that many businesses cant survive if there's no revenue for like a few weeks. Is the financial position really so poor ? That sounds scary