The title for today’s post is a personal. Its been a good week because AVI kiddo topped in his section (2nd grade) of WA State Chess Championship for the year 2020.
Kiddo has been participating in this annual event for the last 3 years. In the first year, he won 3 games of the 5 games he played. At the time he started the tournament as a clear favorite and was highest rated child for his section (kindergarten), however he did not live up to the expectations in the tournament.
Last year, the tournament was held in Tacoma, and kiddo did rather well, winning 4 of 5 games and placing in the top 10 position. The year had started well, however after a surprising poor performance in late February of the year, kiddo lost his confidence, started to get anxious, and had a series of bad tournament games and his rating tumbled to a nadir of 881 in late-April.
Given the fact that the state championship was coming soon, I began a serious intervention program and we began preparing earnestly for the upcoming tournament. Kiddo got a annual membership for chesskids.com, and kiddo began studying video lessons on end games, an area of weakness for him. I for the most part, focused on mental side of things, helping kiddo to control his anxiety, beef up his confidence and enable him to better handle losses. The intervention proved to be timely and kiddo’s performance at 2019 State Chess Championship turned out to be much better than we had expected going into the tournament.
The chart below shows the evolution of his rating since 2018.
Going into 2020, our focus was to continue mind training and focus on game weaknesses, in particular, end games. As luck would have it, the Covid-19 pandemic, forced the 2020 WA State Chess Championship Committee to move the tournament online and the portal of choice for the games was chesskids.com!
As noted above, AVI kiddo has been practicing on chesskids for more than a year and is intimately familiar with the platform. This familiarity turned out to be a big plus for kiddo. Also, kiddo quite enjoys playing online with no ensuing pressure that results from a face-to-face interaction. As such I had confidence in kiddo performing well in this years tournament, what I did not expect was how well he performed!!!
The second reason this week was good was because, Mr AVI got to enjoy home-cooked (courtesy Mrs Avi) restaurant style four course meal on the occasion of his birthday! Kuddos to Mrs Avi, for a wonderful birthday gift!
Below, are some photos of the wonderful home-cooked meal!
Its been a rather extraordinary month of April for the markets. After a disastrous March, S&P 500 rose 12.7 % for the month in April, for its best month since Jan 1987, when S&P500 gained 13.2 %. Below is the chart of top months as measured by percent change since World War II.
Contrast this with the following two charts (from Economist.com):
US GDP in the last week of April dropped down to negative 11.6 % and as of April, Covid-19 has become one of the biggest killers of 2019, surpassing deaths from Malaria and Diabetes by a far margin. In this environment, does it make sense that markets produced one of the best monthly returns of the century?
May be it does make sense! You see, markets are forward looking and it seems all the bad news of the recent past may be already priced in. A wave of good news, from antibody tests to antiviral treatment and even the possibility of soon having millions of Coronavirus vaccines, may be indicative of an end in sight for the worst pandemic of the 21st century.
We can also look into history for a precedence. The following table from a recent blog by Ben Carlson offers a summary of instances from time periods since world war II when the market returns did not follow the direction of the economy.
A final point of note, the Conference board Consumer Confidence Present Situation Index, saw a precipitous drop from 166.7 to 76.4 in April. However the Expectations Index, based on the consumers’ short-term outlook for income, business and labor ticked upwards from 86.8 in March to 93.8 in April. A sign of general optimism about the coronavirus dying down as hot season approaches and/or the populace expectation of being in a good shape to handle the situation should a second wave hit.
Video/Book/Article/Audio for the Week
- Video: For those who missed the annual Berkshire meeting, live streamed on Yahoo Finance. In my next post, I will take a deep dive into the meeting and share some key highlights from the meeting.
- Blog: There is still hope for value investors… interesting piece by Verdad, When Buffet was a Quant
- Blog: Morgan Housel on the futility of forecasting the future
- Blog: Ashwath Damodaran, Viral Market Update VII