Hello everybody, how's everyone doing? It's Sam from Financial Samurai and in this episode I want to catch up on a lot of things and a lot of good things that I've been seeing since the last episode. You know the stock market has rallied significantly from its bottom so it's looking so far that buying equities below $2400 on the S&P is a good move.

You're up you know 15 to 27% depending on where you bought and also it looks like people are getting their stimulus checks of $1,200 per person if you make under $75,000 you get that full amount. $2,400 if you're a couple and you make under $150,000 and $500 per child.

So there are people who are getting $2,400 plus $500, $2,900 and $3,400 and even more and that's finally hitting the bank out in mid-April. Further you're seeing small business owners which make up 99 plus percent of all businesses in America who also employ about 48% of all working Americans in America start to get their Paycheck Protection Program loans funded.

Now it's really still quite slow given they were allowed to apply on what April 3rd and it's April 16th. Still a minority of applications have got their PPP funding and also the PPP funding of $350 billion has temporarily run out because there's a roadblock in Congress but expect that money to continue to go through.

However I think all the loans will go through because politicians want power and they need to get re-elected. So all these businesses, 99% of all businesses, should get eight weeks of payroll paid for and that money will be forgiven if they keep their employees as is on their payroll with the same type of salaries.

And then you look further down the line those people who unfortunately lost their jobs so something like 22 million unemployment claims by April 16th 2020. I mean that's a crazy amount. However the government is offering $600 extra unemployment benefits for weeks. I think up to 39 weeks which is not as high as the 99 weeks during the 2008-2009 financial crisis but still it's a pretty good amount.

Here in California you can earn $4,200 in unemployment benefits per person and if you have a dual unemployed household that's $8,400 a month and that's $100,800 a year. I think most of us most of us can provide for ourselves for $4,200 a month at least food and shelter and just the random basic necessities so that's really great.

And even illegal immigrants here in California are getting I think $500 from a $125 million fund provided by taxpayers and private citizens. Say what you will I think if you're a productive member of society you should probably get some type of relief given everybody is getting some type of relief.

So a lot has been going on I've gotten a lot of questions I just want to do a quick Q&A here. So the most common question I get is are you buying into the stock market rally and my answer is no I am not buying any more equities with the S&P 500 above was like $2,750 right now.

I was buying all the way down to about $2,300 and I've stopped because I fully fulfilled my goal of boosting my equity exposure from 20% of net worth to 25% of net worth. In fact I've been trimming some equity positions that I bought earlier and reallocated some of my municipal bond funds into paying down some mortgage debt.

I mean this is a crazy violent quick rally just like it was a crazy violent sell-off. I mean there are symmetries to that but you've got to believe that there's gonna be some hiccups on the way. You know the market always discounts the future and that's why you know coming up with a framework and saying okay where do you think earnings are gonna go and then coming up with that stock market bottom post that I wrote I think was a way to help people think about earnings and now we're gonna go into first quarter earnings and you know they're not gonna be good but hopefully we expected this but the real X factor is the second quarter and it's probably not gonna happen where we're gonna go straight up right back to $3,200 $3,300 we're gonna see a lot of false starts we're gonna see some problems we might see some reactivation in cases that we're seeing in South Korea and maybe in China.

Who knows but you've got this second chance to reallocate your risk assets to be appropriate with your risk tolerance. I mean just think about all the noise and the doom and gloom they were hearing when you know the Dow was below $20,000 and the S&P 500 was below $2,300 I mean people were talking about going 50% 70% lower greatest pain affliction ever in the history of mankind all that stuff and here we are much much much higher so if you were just freaking out at way lower levels you have a chance to right that ship and make sure your risk exposure matches your risk tolerance.

Second question have your thoughts about a second half v-shaped recovery change? Largely no, largely no. Maybe we're gonna have more of a swoosh shape recovery but I still think there's gonna be a pretty solid recovery because this is a self-inflicted wound. I believe portions of our economy will start opening up in May and in June.

I believe that we're gonna learn to live with the virus in our day-to-day lives we're just gonna make a lot more adjustments. I believe handshakes will be down, face mask usage will be up, there's gonna be a quota system for how many people can enter a store and so forth but we're gonna get things done and I think now we are much safer from the coronavirus than we were back in March because of all these lockdowns that we've been doing for the past three four weeks.

I do believe the government will do everything possible to try to keep afloat as many Americans as possible and therefore if the lockdowns end in May or June and everybody gets their PPP loans and their stimulus checks and their unemployment benefits I think things will inevitably resume and I think you're seeing that in the stock market in a reflection that the curve is flatter than expected, less people are getting the virus as the model is expected and so forth.

Next question I get is are you making any changes with your finances? Well I do like to review my cash position every day because it feels so good to see that cash and you just tell yourself ah nothing can take away from the cash but I'm readying my cash just in case there is an opportunity in the real estate market so I want to find that real estate seller who is the stock seller who's panic sold at Dow 18,600 and the S&P 500 at 2250.

I think they are out there and you need cash to take advantage and you need to look to take advantage so that's one thing I'm doing. The second thing I'm doing is trying to replenish my cash because I spent about 90% of my cash buying equities on the way down and of course I didn't bottom ticket because I had multiple multiple tranches but I did use 90% of my cash and it feels good to have more cash during uncertain times.

The other funny thing I'm doing which probably is irrelevant to most of you is I'm looking for personal finance sites to buy because what this pandemic has taught me is that hmm having an online media business no matter how small can actually be quite defensive and quite attractive because the government can't force me or any website owner to shut down their website.

Yeah revenue could be down, business could be down but so long as you can keep on operating you can find a way. So again I think if there are people who over levered or just spend too much I don't know I think there's opportunity. I really do believe there's only a two to three month opportunity where there is tremendous value that can be had.

For example when Silver Lake and Sixth Street Partners decided to invest 1 billion in Airbnb with a 10% interest rate and warrants that convert to an 18 billion valuation that's gonna be the stuff of legends folks I think in a couple years because Airbnb was valued at about it's like 40 something billion during the 2017 round and was expected to go public for 50 plus billion in 2020.

So if you can get those type of terms I think in two three years when things normalize people are going to be talking about this deal and I think if you can aggressively hunt right now for deals whether it's in real estate or in private websites or just anything that you know you think could be at risk I think now is the time.

We've already had our chance buying stocks they move so quickly and you've seen a massive rebound it's time to see if there's any laggard risk assets out there that may be very attractively valued. So overall I hope all of us are a little bit more hopeful than we were a month ago and there are a lot of positives as I've discussed in this podcast and there are a lot more positives that I haven't discussed such as healing your body from the grind of work, spending more time with your children, letting the earth heal a little bit more, less pollution and so forth.

But again I am very optimistic in general as a person so of course take my view with a grain of salt and if you want a good dose of reality and negativity and all that just turn on the news or just go on social media or wherever you get your news.

I'm personally going to reduce the amount of social media consumption and news consumption because I felt that it really weighed me down in the first quarter and I did write a first quarter 2020 recap entitled "The Most Brutal But Beautiful Quarter" and it was brutal obviously for all these reasons such as the lockdown and the fears of the virus and so forth but it was beautiful because I got to spend time with my family.

And feel free to read the post and comment and share your thoughts and going forward I'm just going to continue to do what I've been doing for you guys and that is to write and to occasionally record and to share my thoughts about what's happening. So far I think we're heading in the right direction and if we're not I'm going to definitely tell you so stay tuned, stick around, be healthy, be happy, be loved, be hopeful, be safe and just keep on going.

We're right in the thick of things that every day that goes by is one less day that we have to go through pain and I think things will get better and they are getting better. Take care, everyone.