Monday, March 16, 2020

Goldman Sachs: The S&P 500 May Drop To 2000 Before It Bottoms

And they've been preparing:
January 29, 2020
Dogbert the Doomsday Pundit
From Dilbert:

 - Dilbert by Scott Adams
Is this why the homeless are gathering in California?
We like Dogbert. This one was dated December 3, 2011, some things never change.
One more:...
March 16, 2020 S&P:  2,422.37-288.65 (-10.65%); all-time high 3,393.52 on February 19

From ZeroHedge:

How Much Further Can Markets Fall? Here Is One Bank's Answer
On Friday, March 6, Goldman's chief US equity strategist, David Kostin, who bizarrely still holds held the view that the S&P will close the year at 3,200, despite now expecting an earnings recession, and Gldman economists calling for an economic recession in Q2 and a -5% GDP crash in Q2, laid out a binomial "downside case" scenario  (i.e., a coin toss because as he admitted, he has no idea if the S&P would go up or go down) that saw the S&P plunging from the mid-2,900 level (where it was trading then) to 2,450 in a "coronavirus recession" case.
One week, and three-limit down sessions later, the S&P traded at 2,401....
...Here things get complicated. Here is part one of his summary:
The combination of thin liquidity, high uncertainty, and positioning could cause the S&P 500 to fall below our 2450 base case estimate of fair value and closer to a trough of 2000.
Then there is part two:
"During the 11 recessions since World War II, S&P 500 experienced an average peak-to-trough decline of 30%. However, the decline was larger during the last two recessions than during prior downturns. The S&P 500 fell by 49% after the Tech Bubble burst in 2000 and by 57% during the Financial Crisis. A 50% decline from the February high suggests an index level of 1700, 37% below the current market level."...