Author Archives: fsheen

Q-1 2020 The Coronavirus Quarter

This will be a somewhat different update because of the extraordinary circumstances of the last seven weeks. I think it’s important to examine more fully what may have actually happened, the motivations and agendas being pushed, and their devastating effects on world economies and global markets.

The first quarter of 2020 has changed everything; things will never be the same as they were before these events transpired. Good or bad the world has changed and the consequences of the worldwide quarantine and decisions made to counteract the coronavirus are still unfolding. Fear, lack of forethought and inaccurate statistics caused people, governments, and businesses to overreact and make short-sighted decisions with long-term consequences. The WSJ wrote:

“The U.S. economy has been cratered less by the coronavirus than by the response to it—driven by the undemocratic idea that “science” should rule, even when much of the science and the data behind it remain in dispute.  We’re told in this plague year that politicians have no role—in essence, that the people have no real rights against consensus science, which can demand that we forfeit our liberties and suspend the Constitution. Political leaders, elected to exercise judgment on our behalf, must defer to doctors, because the viral threat is addressable only through medical expertise.”

Many small businesses have closed their doors, never to re-open, and the massive job loss will ultimately cause many people to lose their cars, homes, retirement and go bankrupt.  This will cause a dramatic rise in domestic disputes, mental/emotional health issues, drug and alcohol abuse, homelessness, crime and the need for public assistance, as well as many other social problems. Suicide is already a greater mortal threat than the coronavirus in most areas, and all of the aforementioned factors will contribute to increased depression and loss of life as well. Every week the current restrictions remain in force, the worse these issues will become. As more accurate statistics are considered, many experts fear the risk accompanying the quarantine is becoming greater than the protection it may be providing, and states are meeting together to discuss re-opening businesses and easing quarantine requirements. Fox News anchor Tucker Carlson does an excellent twelve-minute segment summarizing these concerns (see below).

States Move to Coordinate on Reopening Plans (4.13.20) WSJ

https://www.wsj.com/articles/u-s-coronavirus-cases-rise-as-officials-weigh-when-to-restart-the-economy-11586774781?mod=hp_lead_pos1

We Need Politicians in a Pandemic (4.12.20) WSJ  https://www.wsj.com/articles/we-need-politicians-in-a-pandemic-11586710824

Tucker How Long Will the Lockdowns Last (4.6.20) Fox News  https://www.youtube.com/watch?v=ZCyqcoC747o

Economic Data Spur Debate Over Lifting Virus Restrictions (4.9.20) WSJ

https://www.wsj.com/articles/dire-economic-numbers-intensify-debate-over-lifting-coronavirus-restrictions-11586459653

Perspectives on the Pandemic (3.26.20) Dr. John Ioannidis of Stanford University Episode 1 https://www.youtube.com/watch?v=d6MZy-2fcBw&feature=youtu.be&inf_contact_key=fb956899ab666f9ff048a15970bc0d03cc0558ed5d4c28cbfab114022b1ec50d

Projection of 100K-240K Coronavirus Deaths Was Likely an Overestimate (4.8.20)

https://www.theblaze.com/news/fauci-admits-previous-coronavirus-death-projection-was-likely-an-overestimate?utm_source=theblaze-breaking&utm_medium=email&utm_campaign=20200408Trending-FauciOverestimate&utm_term=ACTIVE%20LIST%20-%20TheBlaze%20Breaking%20News

Is the Coronavirus as Deadly as They Say (3.24.20) WSJ https://www.wsj.com/articles/is-the-coronavirus-as-deadly-as-they-say-11585088464

Inaccurate Virus Models Are Panicking Officials Into Ill-Advised Lockdowns (3.25 20) The Federalist https://thefederalist.com/2020/03/25/inaccurate-virus-models-are-panicking-officials-into-ill-advised-lockdowns/

 

When all of the fear and paranoia is boiled away and accurate statistics are considered, we’re left with a new virus much like the flu, which a very small portion of the population are vulnerable to. Some interim precautions were understandable, and individuals should still take measures to protect themselves, but the overall reaction and projected mortality rates were extremely exaggerated. President Trump even withdrew US funding from the WHO because of their irresponsible acceptance of China’s claims on the coronavirus, inaccurate statistics and projections and failure to share information about the pandemic as it spread.

As with any crisis, various individuals, organizations and governments will attempt to use the crisis to further their agendas. Some governors and legislatures are using this crisis to circumvent people’s constitutional rights preventing or curtailing the purchase of firearms and ammunition, and preventing peaceful assembly. George Soros, Henry Kissinger, the Pope, the UN and others are calling for more global control that supersedes national sovereignty in order to require mandatory vaccinations. Bill Gates is pushing legislation to require mandatory vaccination of all American citizens and the insertion of an RFID chip, purportedly to monitor our health and help control future outbreaks. He is building seven factories to manufacture seven potential vaccines.

A number of reputable sources have drawn a direct correlation between 5G and the coronavirus and some have claimed the virus narrative was created as a cover-up for the negative effects of 5G. I don’t believe 5G causes the coronavirus, but I do believe it can negatively impact health, causing people to be more vulnerable to the virus. Some municipalities, like San Francisco, have passed ordinances in an attempt to prevent 5G towers from being built due to health concerns about the negative effects of 5G radiation, especially on people with compromised immune systems. I believe the virus came out of the bio-research lab in Wuhan China, and China’s delayed response caused massive deaths of its own people in and around Wuhan. I also find it interesting, however, that there is little to no information about what happened in the rest of China, only Wuhan, almost as if the outbreak was confined to that area and did not affect the rest of China. We will likely never know for sure what really happened and why.

Trump Halts Payment to WHO, Blames Them for Delayed Response (4.14.20) Fox Video https://www.youtube.com/watch?v=QFzAt70L8e4&feature=emb_logo

AG Barr Very Concerned About Personal Liberty After Gates Proposes Digital Vaccine Certificates (4.9.20) https://www.lifesitenews.com/news/ag-barr-very-concerned-about-personal-liberty-after-gates-proposes-digital-vaccine-certificates

The Coronavirus Pandemic Will Forever Alter the World Order (4.3.20) WSJ Henry Kissinger https://www.wsj.com/articles/the-coronavirus-pandemic-will-forever-alter-the-world-order-11585953005

The Treasury Has Absorbed the Fed, NSARA & More (4.4.20)  https://www.youtube.com/watch?v=1yb0gAtfUnI&feature=share

Who Failed Trump Halts Payment to WHO, Blames Them for Delayed Response (4.14.20) Fox Video https://www.youtube.com/watch?v=QFzAt70L8e4&feature=emb_logo

How a Police State is Born (4.1.20) ) https://www.americanthinker.com/articles/2020/04/how_a_police_state_is_born.html

Big Government Using Coronavirus Pandemic To Secure More Control (3.27.20) The Blaze

https://www.youtube.com/watch?v=3SoZlR6xNZU&feature=emb_logo

The National Plan to Vaccinate Every American (3.21.20)

https://www.nvic.org/NVIC-Vaccine-News/March-2020/the-national-plan-to-vaccinate-every-american.aspx?utm_source=The+National+Plan+to+Vaccinate+Every+American&utm_campaign=July+NVIC+Newsletter&utm_medium=email

San Francisco is Resisting 5G, Calling it Ugly & Dangerous (6.1.19) Fox News

https://www.foxnews.com/tech/san-francisco-is-resisting-5g-calling-it-ugly-and-dangerous

 

Having addressed those things, let’s examine the effects of the coronavirus on global markets, national economies and personal finances. The Dow reached its all-time highest point 29,551 on Feb. 12, 2020. It closed Monday, March 23 at 18,559, down over 11,000, then rose to 23,719 to finish the week on April 10, 2020. Regardless of the actual or perceived threat posed by the Coronavirus, investors are reacting and market analysts have no grid system for what’s happening and no clue what will happen next. As soon as the epidemic peaks and cases begin to decline, states will begin to open to ease quarantine restrictions and reopen the economy.  It will take time to assess the damage; many businesses will not re-open and many more may not be able to survive in the aftermath, even with all the money which has been made available to them through low-interest loans and deferments. Gold has moved up in the last four weeks, but silver is lagging. The US stock future indexes are rising as states talk of re-opening.

Gold’s Powerful Rally Brings $1,800 Into View as Spreads Yawn (4.14.20) Bloomberg

https://www.bloomberg.com/news/articles/2020-04-14/gold-s-powerful-rally-has-bulls-setting-their-sights-on-1-800?srnd=premium

U.S. Stock Index Futures Rise as Countries Look at Reopening (4.13.20) Bloomberg

https://www.bloomberg.com/news/articles/2020-04-14/u-s-stock-index-futures-rise-as-countries-look-at-reopening?srnd=premium

Dow Escapes Bear Market With a 6% Rally (3.26.20) WSJ

https://www.wsj.com/articles/global-stock-markets-dow-update-3-26-2020-11585196225?mod=hp_lead_pos1

Dow Climbs in Best Day Since 1933 on Stimulus Hopes (3.24.20) WSJ

https://www.wsj.com/articles/global-stock-markets-dow-update-3-24-2020-11585012632?mod=hp_lead_pos1&mod=article_inline

Dow Plunges 10% With Stimulus Details Uncertain (3.18.20) Bloomberg

https://www.bloomberg.com/news/articles/2020-03-17/asia-to-extend-stock-rally-after-u-s-shares-gain-markets-wrap

FDIC Asks Americans to Keep Their Money in the Banks (3.25.20)

https://www.sovereignman.com/trends/fdic-asks-americans-to-keep-their-money-in-the-banks-27579/?utm_medium=email&utm_source=sm_notes&utm_campaign=notes&utm_content=20200325_fdic

U.S. Will Suspend All Travel From Europe for Next 30 Days (3.11.20) WSJ https://www.wsj.com/articles/coronavirus-outbreak-prompts-trump-to-question-europe-travel-restrictions-11583971156

Stock Markets Down More Than 7% After Trading Halt Lifts (3.9.20) WSJ

https://www.wsj.com/articles/asian-stock-markets-in-early-monday-sell-off-after-saudi-arabias-decision-to-cut-most-of-its-oil-prices-11583713399

Trump Administration to Delay April 15 Tax Deadline for Most Individuals (3.12.20) WSJ https://www.wsj.co m/articles/u-s-treasury-likely-to-push-back-april-15-tax-filing-deadline-sources-11583897351

 

Central Banks & Banks

The Federal Reserve lowered interest rates a half percent, and then lowered them again March 15 to almost 0; lower than the 2008 Financial Crisis. Even more worrisome, they are making the largest infusion of cash into the overnight repo market in history. They also are going to be buying $500 billion Treasury Securities and $200 billion Mortgage Back Securities. This dramatic action clearly shows that the financial fallout is much greater than people think, as these actions are unprecedented.

The Federal Reserve and many of the other central banks of the world have lowered interest rates and printed massive amounts of money, so there is not much more they can do from this point forward. The banking system is in trouble to the degree that the FDIC put out a video asking people not to take their money out of their banks. The lowest, longest-running rates of unemployment have also come to a halt, with unemployment rates skyrocketing. Bloomberg wrote, “The Federal Reserve’s balance sheet topped $5 trillion for the first time amid the U.S. central bank’s aggressive efforts to cushion debt markets against the coronavirus outbreak through large-scale bond-buying programs.

The Independent UK News reported, “The Bank of England has agreed to expand the overdraft facility it offers the government, amid concerns about potential strains in the state debt market brought on by the Covid-19 emergency. The Bank and the Treasury announced on Thursday morning that its long-standing Ways and Means (W&M) facility will be extended to enable the government to borrow as much as it needs to meet its commitments.”

Bank of England Extends Government’s Emergency Overdraft Account Amid Coronavirus Crisis (4.13.20)

https://www.independent.co.uk/news/business/news/coronavirus-bank-of-england-treasury-ways-means-overdraft-borrowing-a9457071.html

Fed Unveils New Programs to Support $2.3 Trillion in Lending (4.9.20) WSJ

https://www.wsj.com/articles/fed-announces-new-facilities-to-support-2-3-trillion-in-lending-11586435450

Federal Reserve’s Balance Sheet Tops $5 Trillion for First Time (3.26.20) Bloomberg  https://www.bloomberg.com/news/articles/2020-03-26/federal-reserve-s-balance-sheet-tops-5-trillion-for-first-time

FDIC Asks Americans to Keep Their Money in the Banks (3.25.20)

https://www.sovereignman.com/trends/fdic-asks-americans-to-keep-their-money-in-the-banks-27579/?utm_medium=email&utm_source=sm_notes&utm_campaign=notes&utm_content=20200325_fdic

Federal Reserve Issues $500 billion to Overnight Lending Program (3.14.20) The Blaze

https://www.theblaze.com/glenn-radio/federal-reserve-issues-500-billion-overnight-loan-to-banks

FDIC Asks Americans to Keep Their Money in the Banks (3.25.20)

https://www.sovereignman.com/trends/fdic-asks-americans-to-keep-their-money-in-the-banks-27579/?utm_medium=email&utm_source=sm_notes&utm_campaign=notes&utm_content=20200325_fdic

Negative Interest Rates in the US are Virtually Guaranteed Now (3.4.20) SMC https://www.sovereignman.com/trends/negative-interest-rates-in-the-us-are-virtually-guaranteed-now-27405/?utm_medium=email&utm_source=sm_notes&utm_campaign=notes&utm_content=20200304_interest

Fed Cuts Rates to Near Zero and Will Relaunch Bond-Buying Program (3.15.20) WSJ

https://www.wsj.com/articles/fed-faces-crucial-decisions-to-alleviate-virus-shock-11584303662

Fed Unveils Dramatic Measures to Ease Market Strain on Virus (3.12.20) Bloomberg https://www.bloomberg.com/news/articles/2020-03-12/n-y-fed-to-conduct-purchases-across-range-of-maturities-k7ozy3u5?srnd=premium

Federal Reserve Issues $500 Billion to Overnight Lending Program (3.14.20)

https://www.theblaze.com/glenn-radio/federal-reserve-issues-500-billion-overnight-loan-to-banks?utm_source=theblaze-dailyAM&utm_medium=email&utm_campaign=Daily-Newsletter__AM%202020-03-15&utm_term=TheBlaze%20Daily%20AM%20-%20last%20270%20days

 

Debt Recession

The US passed a $2 trillion stimulus plan and another trillion-dollar plan is already in the works.  Some nations can afford to deal with the crisis, but many cannot. Italy‘s debt burden even before this crisis was more than 120% of GDP and their banks were in trouble before the crisis. Simon Black wrote, “Every scenario is on the table, and absolutely anything can happen, but it seems pretty clear that the most heavily indebted countries are in big trouble… and we may be looking at a major sovereign debt crisis over the next few months.”  Currently, the expectation of the IMF and most nations is that we are potentially headed for the most difficult recession the world has ever seen.

World Economy Is Almost Certainly in Recession (4.14.20) WSJ

https://www.wsj.com/articles/coronavirus-afflicted-global-economy-is-almost-certainly-in-recession-11586867402

Mapping the COVID-19 Recession (4.7.20)

https://www.project-syndicate.org/commentary/mapping-covid19-global-recession-worst-in-150-years-by-kenneth-rogoff-2020-04

Coronavirus Crisis Legacy Mountains of Debt (4.9.20) WSJ

https://www.wsj.com/articles/coronavirus-crisis-legacy-mountains-of-debt-11586447687

There’s a Major Sovereign Debt Crisis Looming (4.4.20) SMC  https://www.sovereignman.com/trends/theres-a-major-sovereign-debt-crisis-looming-27612/?utm_medium=email&utm_source=sm_notes&utm_campaign=notes&utm_content=20200402_crisis

What’s in the $2T Stimulus Bill (3.28.20) Glen Beck https://www.youtube.com/watch?time_continue=17&v=27T4IfIgNb4&feature=emb_logo

The Small Business Administration is now bigger than Walmart (3.30) SMC

https://www.sovereignman.com/trends/the-small-business-administration-is-now-bigger-than-walmart-27604/?utm_medium=email&utm_source=sm_notes&utm_campaign=notes&utm_content=20200330_ussba

Federal Reserve’s Balance Sheet Tops $5 Trillion for First Time (3.26.20) WSJ  https://www.bloomberg.com/news/articles/2020-03-26/federal-reserve-s-balance-sheet-tops-5-trillion-for-first-time

White House, Lawmakers Strike Stimulus-Bill Deal (3.24.20) WSJ

https://www.wsj.com/articles/trump-administration-senate-democrats-said-to-reach-stimulus-bill-deal-11585113371

Bond Downgrades Begin Amid Coronavirus Slowdown (3.24.20) WSJ

https://www.wsj.com/articles/bond-downgrades-begin-amid-coronavirus-slowdown-11585045800

 

World Economies

The US, which just two months ago had some of the best unemployment numbers ever, is now experiencing some of the highest unemployment numbers ever. Many companies large and small have applied for assistance under the 2 trillion dollar stimulus package passed by Congress. The WSJ wrote, “As job losses ricochet across the U.S., Europe is conducting an unprecedented experiment in navigating the economic fallout from the new coronavirus: Persuade companies to forgo layoffs by subsidizing private-sector wages on a massive scale.  More than one million companies across the continent have signed up for subsidy programs that essentially transform their payrolls into a system for delivering billions of euros in stimulus funds directly to households.”

Countries around the world are looking to their governments for assistance, and many countries are looking to the IMF to help provide that assistance. The WSJ reposted, “Scores of countries are asking for bailouts and loans from financial institutions with $1.2 trillion to lend.  The health of the global economy comes down to a race between money flooding out of emerging markets amid the coronavirus pandemic and the efforts of the International Monetary Fund and World Bank to pump money back in. The two Washington-based finance institutions find themselves facing the greatest challenge since they were established as the heart of the international monetary system at the 1944 Bretton Woods Conference.”

IMF & World Bank Face Deluge of Aid Requests From Developing World (4.9.20) WSJ https://www.wsj.com/articles/imf-world-bank-face-deluge-of-aid-requests-from-developing-world-11586424609?mod=article_inline

Europe Unleashes Massive Subsidies to Stem Job Losses (4.9.20) WSJ

https://www.wsj.com/articles/europe-unleashes-massive-subsidies-to-stem-job-losses-11586437241?mod=world_major_1_pos5

U.S. Jobless Claims Soar for Third Straight Week (4.9.20) WSJ

https://www.wsj.com/articles/u-s-surge-in-unemployment-claims-expected-to-continue-11586424605

US Weekly Jobless Claims Seen At Record High – Again (4.2.20) Fox News

https://www.foxbusiness.com/markets/us-weekly-jobless-claims-seen-at-record-high-again

Record Rise in Unemployment Claims Halts History Run of Job Growth (3.26.20) WSJ https://www.wsj.com/articles/the-long-run-of-american-job-growth-has-ended-11585215000?mod=hp_lead_pos2

New Zealand Stocks Plummet, Set to Enter Bear Market (3.12.20) Bloomberg

https://www.bloomberg.com/news/articles/2020-03-12/new-zealand-stocks-plummet-set-to-enter-bear-market?srnd=premium

Oil has fallen radically, but this not because of the Coronavirus, it’s because the Saudis increased their output, which caused other countries to increase their output, causing oil prices to freefall.  Bloomberg wrote, “Saudi Arabia plans to boost oil output next month to well above 10 million barrels a day, as the kingdom responds aggressively to the collapse of its OPEC+ alliance with Russia.  The world’s largest oil exporter engaged in an all-out price war on Saturday by slashing pricing for its crude by the most in more than 30 years. State energy giant Saudi Aramco is offering unprecedented discounts in Asia, Europe and the U.S. to entice refiners to use Saudi crude.”

Saudis Plan Big Oil Output Hike, Beginning All-Out Price War (3.7.20) Bloomberg   https://www.bloomberg.com/news/articles/2020-03-07/saudis-plan-big-oil-output-hike-beginning-all-out-price-war

U.S. Oil Majors Are Snubbing Climate-Conscious Rivals in Europe (3.5.20) Bloomberg

https://www.bloomberg.com/news/articles/2020-03-05/exxon-ceo-calls-rivals-climate-targets-a-beauty-competition

How Do You Solve a Problem Like Fannie and Freddie (3.2.20) Bloomberg

https://www.bloomberg.com/news/articles/2020-03-02/fannie-mae-and-freddie-mac-s-fate-is-in-the-hands-of-one-man?srnd=premium

European Stocks Have Worst Day in Decades (3.12.20) WSJ

https://www.wsj.com/articles/markets-shudder-despite-ecb-virus-package-11584025369

 

Political Uncertainty

Political instability is everywhere. Some elections are still being held, but many are being postponed because no one can go out and vote. We also have the same problems we’ve been dealing with before the crisis still lurking in the background. The Huawei controversy is still raging and China has become less trustworthy due to this issue as well as a number of other allegations, and their mishandling of the virus. The only country moving closer to them is the Philippians. The WSJ reported in February, “U.S. officials say Huawei Technologies Co. can covertly access mobile-phone networks around the world through “back doors” designed for use by law enforcement, as Washington tries to persuade allies to exclude the Chinese company from their networks.  Intelligence shows Huawei has had this secret capability for more than a decade.  U.S. officials say Huawei has built equipment that secretly preserves the manufacturer’s ability to access networks through these interfaces without the carriers’ knowledge.”

One thing for sure is that political instability and uncertainty will be increasing not decreasing in the days ahead.

China Blasts Trump’s Move to Pull WHO Funding, Pledges Support (4.14.20) Bloomberg

https://www.bloomberg.com/news/articles/2020-04-15/china-blasts-trump-s-move-to-pull-who-funding-pledges-support

Legally Embattled Netanyahu Claims Victory After Turbulent Year (3.2.20)  https://www.bloomberg.com/news/articles/2020-03-03/netanyahu-edges-close-to-victory-at-end-of-tumultuous-year

Poland Sets Presidential Election Date as Clash With EU Deepens (2.5.20) Bloomberg https://www.bloomberg.com/

U.S. Officials Say Huawei Can Covertly Access Telecom Networks (2.11.20) WSJ https://www.wsj.com/articles/u-s-officials-say-huawei-can-covertly-access-telecom-networks-11581452256

Philippines to End Military Pact With U.S. (2.11.20) WSJ https://www.wsj.com/articles/philippines-to-end-military-pact-with-u-s-11581439273

Trump & Fighting a War Invisible Enemy Isn’t Just Coronavirus But Socialism, Slavery Too (4.6.20) The Blaze https://www.youtube.com/watch?v=aH4BTpFkcaY&feature=emb_logo

Biological Weapons the Focus of China’s Military Research in the Last 20 Years (March 2020)

https://japan-forward.com/biological-weapons-the-focus-of-chinas-military-research-in-the-last-20-years/amp/

March 2nd Coronavirus Update We’re all Gonna Get it, But We’ll be Fine (3.2.20)

https://www.youtube.com/watch?v=8Ohb9iWnBHg&feature=emb_logo

 

CDC US Coronavirus Outbreak is a Matter of When Not If (2.26.20) The Blaze

https://www.youtube.com/watch?v=N73oU58uTII&feature=emb_logo

 

This Is How Many People Die From the Flu Each Year, According to the CDC (2.11.20)

https://www.health.com/condition/cold-flu-sinus/how-many-people-die-of-the-flu-every-year

(UPDATED 4/1) Coronavirus Reality v Perception and World Markets

The Coronavirus is a mixed bag of truth, lies, deception, confusion, reaction and overreaction.   It has become clear, that the greatest threat and thing to prepare for is not the virus, but the reaction to the virus.  The virus will pass, but governments and the populous reaction to it have changed everything, and an entirely new course has been set politically and economically and financially.

While reasonable precautions should be taken to prevent and manage the spread of COVID-19, we should not be fearful, panic or overreact. Fear is what causes social & news media, governments, markets and individuals tend to overreact to whatever is going on around them.

The virus does present a threat, but it pales in comparison to a plethora of other mortal threats in this world, and society is overreacting. Many suspect the virus will also slow with the warmer weather, like the flu season which usually finishes off in mid-April. Although most citizens seem to only exhibit minor symptoms if affected by the virus at all, it is still good to take precautions without over-reacting. While the COVID-19 numbers are likely skewed due to the number of unreported cases, below are some statistics on the common flu and how it compares to the Coronavirus to provide some perspective.

Flu Statistics:

  • 5% – 20% of the U.S. population that will get the flu, on average, each year.
  • 200,000 Americans hospitalized each year because of problems with the flu.
  • 34,200 flu-related deaths in 2018-2019 Season
  • Globally the flu kills 290,000 to 650,000 annually –The World Health Organization (WHO) estimates

Worldometer on Coronavirus: (As of 4.1.20) https://www.worldometers.info/coronavirus/

  • Total Cases: 927,986
  • Deaths: 46,491
  • Recovered/Discharged: 193,474
  • Active Cases Globally: 688,021
  • Total Cases in US:        211,143
  • US Deaths: 4,713

It is important to consider the facts, as well as how people will react to situations regardless of the facts when planning for practical preparedness in these situations. While the numbers are likely off due to many unreported cases in which citizens never went to the doctor or hospital because their symptoms did not become severe, and while age, prior respiratory issues and/or already weakened immune systems have been a factor in the majority of deaths, it remains a threat and markets, individuals, and governments will continue to react.

Is the Coronavirus as Deadly as They Say (3.24.20) WSJ https://www.wsj.com/articles/is-the-coronavirus-as-deadly-as-they-say-11585088464

Inaccurate Virus Models Are Panicking Officials Into Ill-Advised Lockdowns (3.25 20) The Federalist https://thefederalist.com/2020/03/25/inaccurate-virus-models-are-panicking-officials-into-ill-advised-lockdowns/

The Dow reached its all-time highest point 29,551 on Feb. 12, 2020. It closed Monday, March 23 at 18,559, down over 11,000, then rose to 21,336 to finish the week.  This was the largest drop since the 2008 financial crisis and the largest rise in history. The Federal Reserve lowered interest rates a half percent, and then lowered them again March 15 to almost 0; lower than the 2008 Financial Crisis. Even more worrisome, they are making the largest infusion of cash into the overnight repo market in history.  They also are going to be buying $500 billion Treasury Securities and $200 billion Mortgage Back Securities. This dramatic action clearly shows that the financial fallout is much greater than people think, as these actions are unprecedented.

Even when markets and central banks have a firm foundation, they will fluctuate with world events, but not to this degree. However, when stock market growth cycles peak and/or go into freefall and economies begin to falter, central banks lower interest rates and infuse cash into the banking system to attempt to re-stimulate the economy to sustain growth if possible. Regardless of the actual or perceived threat posed by the Coronavirus, investors are reacting and market analysts have no grid system for what’s happening and no clue what will happen next. In the last week of March, the longest Bull market in American history ended with the Dow dropping more than 20% and the shortest Bear market in history, lasting only three days, having risen 20%. Currently, the Dow is still down 8,000 points from its high, but needless say it’s a roller coaster.

The Federal Reserve and many of the other central banks of the world have lowered interest rates and printed massive amounts of money, so there is not much more they can do from this point forward.  The banking system is in trouble, to the degree that the FDIC put out a video asking people not to take their money out of their banks. The lowest, longest-running rates of unemployment have also come to a halt, with unemployment rates skyrocketing. What will happen next is unclear, as all the restrictions aren’t over yet and the degree of economic fallout is still to be determined.

Dow Escapes Bear Market With a 6% Rally (3.26.20) WSJ

https://www.wsj.com/articles/global-stock-markets-dow-update-3-26-2020-11585196225?mod=hp_lead_pos1

Record Rise in Unemployment Claims Halts History Run of Job Growth (3.26.20) WSJ https://www.wsj.com/articles/the-long-run-of-american-job-growth-has-ended-11585215000?mod=hp_lead_pos2

Dow Plunges 10% With Stimulus Details Uncertain (3.18.20) Bloomberg

https://www.bloomberg.com/news/articles/2020-03-17/asia-to-extend-stock-rally-after-u-s-shares-gain-markets-wrap

FDIC Asks Americans to Keep Their Money in the Banks (3.25.20)

https://www.sovereignman.com/trends/fdic-asks-americans-to-keep-their-money-in-the-banks-27579/?utm_medium=email&utm_source=sm_notes&utm_campaign=notes&utm_content=20200325_fdic

Fed Cuts Rates to Near Zero and Will Relaunch Bond-Buying Program (3.15.20) WSJ

https://www.wsj.com/articles/fed-faces-crucial-decisions-to-alleviate-virus-shock-11584303662

Stocks Plunge 10% in Dow’s Worst Day Since 1987 (3.12.20) WSJ

https://www.wsj.com/articles/global-stocks-follow-u-s-markets-lower-11583975524

Fed Unveils Dramatic Measures to Ease Market Strain on Virus (3.12.20) Bloomberg https://www.bloomberg.com/news/articles/2020-03-12/n-y-fed-to-conduct-purchases-across-range-of-maturities-k7ozy3u5?srnd=premium

Federal Reserve Issues $500 Billion to Overnight Lending Program (3.14.20)

https://www.theblaze.com/glenn-radio/federal-reserve-issues-500-billion-overnight-loan-to-banks?utm_source=theblaze-dailyAM&utm_medium=email&utm_campaign=Daily-Newsletter__AM%202020-03-15&utm_term=TheBlaze%20Daily%20AM%20-%20last%20270%20days

U.S. Will Suspend All Travel From Europe for Next 30 Days (3.11.20) WSJ https://www.wsj.com/articles/coronavirus-outbreak-prompts-trump-to-question-europe-travel-restrictions-11583971156

Stock Markets Down More Than 7% After Trading Halt Lifts (3.9.20) WSJ

https://www.wsj.com/articles/asian-stock-markets-in-early-monday-sell-off-after-saudi-arabias-decision-to-cut-most-of-its-oil-prices-11583713399

As with any emergency, take common-sense steps to be as prepared as possible for any situation and the public’s reaction to it. Utilize good judgment in purchasing extra food and provisions, and keep some extra cash at home (don’t hoard the toilet paper!). The following articles contain a variety of viewpoints and suggestions in regard to the Coronavirus. I am not necessarily in agreement with everything in these articles and interviews, but if you are looking for more information on this subject you may find these helpful.

Farr’s Law and COVID-19 https://nypost.com/2020/03/08/coronavirus-going-to-hit-its-peak-and-start-falling-sooner-than-you-think/

March 2nd Coronavirus Update We’re all Gonna Get it, But We’ll be Fine (3.2.20)

https://www.youtube.com/watch?v=8Ohb9iWnBHg&feature=emb_logo

What Are Your Odds of Getting the Flu https://www.webmd.com/cold-and-flu/flu-statistics

CDC US Coronavirus Outbreak is a Matter of When Not If (2.26.20) The Blaze

https://www.youtube.com/watch?v=N73oU58uTII&feature=emb_logo

CDC outlines what closing schools, businesses would look like in a pandemic  (2.25.20) CNBC https://www.cnbc.com/2020/02/25/cdc-outlines-what-closing-schools-businesses-would-look-like-in-us-pandemic.html

This Is How Many People Die From the Flu Each Year, According to the CDC (2.11.20)

https://www.health.com/condition/cold-flu-sinus/how-many-people-die-of-the-flu-every-year

WHO Declares Coronavirus Outbreak a Global Public-Health Emergency (1.30.20) WSJ https://www.wsj.com/articles/coronavirus-triggers-damage-control-from-governments-companies-11580396657

3rd Quarter Economic Update

SUMMARY

The 3rd quarter ended with great volatility which continued into the first two weeks of the 4th quarter. US stocks fell sharply in the first week of October due to concerns of slowing US manufacturing; all three major indexes have been negative for the past 12 months.  The second week brought news of potential succession of the trade war between the US and China, after which the stock market recovered.  Many large players have withdrawn their participation in Facebook’s new Libra crypto currency.  Political unrest continued around the world, especially in Hong Kong.  Brexit didn’t break in the third quarter, but Boris Johnson struck a deal with the EU on Oct 16th and brought it to Parliament for approval, but the deadline is less than two weeks away.  While everyone was watching the trade wars, global markets and political events, there was much under-reported central bank action, and a brand new international wire system also came online.

U.S., China Move Forward on Trade (10.11.19) WSJ

https://www.wsj.com/articles/trump-strikes-upbeat-notes-on-trade-talks-11570804097

Facebook’s Backers of Libra Reconsider Their Involvement (10.1.19) WSJ

https://www.wsj.com/articles/visa-mastercard-others-reconsider-involvement-in-facebook-s-libra-network-11569967023

Glenn Beck Issues Fiscal Warning Just Like he Did Before the 2008 Financial Crisis Something is Very Wrong (9.19.19) The Blaze https://www.theblaze.com/glenn-radio/federal-reserve-repo-market?utm_source=Sailthru&utm_medium=email&utm_campaign=Daily-Newsletter__PM-Final%202019-09-19&utm_term=TheBlaze%20Daily%20PM%20-%20last%20270%20days

 

CENTRAL BANKS

In early September, The Federal Reserve voted to cut interest rates by a quarter-percentage point for the second time in two months, due to rising concerns of a global slowdown.  The WSJ reported:

For first time since 2008 the central bank injects funds into money markets after a sudden shortage of cash.  For the first time in more than a decade, the Federal Reserve injected cash into money markets Tuesday to pull down interest rates and said it would do so again Wednesday after technical factors led to a sudden shortfall of cash. The federal-funds rate, a benchmark that influences borrowing costs throughout the financial system, rose to 2.25% on Monday, from 2.14% Friday. The Fed seeks to keep the rate in a target range between 2% and 2.25%. Bids in the fed-funds market reached as high as 5% early Tuesday, according to traders, well above the band.  The New York Fed moved Tuesday morning to inject $53 billion into the banking system through transactions known as repurchase agreements, or repos. (The repo market is where one bank will borrow from another bank on a short term basis usually overnight, because it doesn’t have enough cash at a higher interest rate.)  The bank said Tuesday afternoon it would inject up to $75 billion more on Wednesday morning, but many in the market were looking beyond that decision.

The infusing of cash into the overnight banking system, which the Fed said they would continue to do until Oct 9th, is a clear indication of current and future troubles, however, this action has infused the banking system with sufficient cash, at least for the short term.  The Federal Reserve will extend its cash injections into overnight lending markets for at least another month, after pumping in more than $330 billion since mid-September, as banks face a wave of Treasury bond sales this week, amid a near-record budget deficit and ongoing concern over the strength of the U.S. economy.

In addition, “The Fed plans to buy $60 billion of Treasurys per month, and many are wondering if it is leading the charge back into quantitative easing, often known as money printing,” – WSJ.

The San Francisco Fed made the following concerning, and hopefully not prophetic, statement, “negative interest rates are a viable tool to provide stimulus to economies that need it, and the U.S. might have benefited from using it during the financial crisis.”.

The entire concept of negative interest rates is already hard to understand, the WSJ reported that, “The European Central Bank is about to start lending to some banks at less than it pays them for putting money on deposit.  The ECB said last week that it would both pay a higher rate of interest on deposits and charge a lower fee for lending, both under strict conditions. On the deposit side, the introduction of what the ECB calls “tiering” allows banks to avoid the penalty rate of minus 0.5% on deposits of excess reserves.”

Finding Meaning in Quantitative Easing (10.11.19) WSJ https://www.wsj.com/articles/finding-meaning-in-quantitative-easing-11570872601

Fed Paper Says Negative Rate Policy Can Provide Real Stimulus (10.15.19) WSJ

https://www.wsj.com/articles/sf-fed-paper-says-negative-rate-policy-can-provide-real-stimulus-11571158871?mod=hp_lista_pos4

Fed Extends Repos Until Nov 4 Dealers Brace for $193 Billion in Treasury Sales (10.7.19) https://www.thestreet.com/investing/fixed-income/fed-extends-repos-until-nov-4-dealers-brace-for-193-billion-in-treasury-sales-15116925

Fed Intervenes to Curb Soaring Short-Term Borrowing Costs (9.17.19) WSJ

https://www.wsj.com/articles/fed-to-conduct-first-overnight-repo-transactions-in-several-years-11568729757

Another Coming Recession Federal Reserve Funds Banks Billions, Market is Broken (9.21.19) TheBlaze

https://www.youtube.com/watch?v=bW7ZYc4w3ds&feature=youtu.be

Fed Cuts Rates by Quarter Point But Faces Growing Split (9.18.19) WSJ

https://www.wsj.com/articles/fed-cuts-rates-by-quarter-point-but-faces-growing-split-11568830081?mod=hp_lead_pos1

Big Banks Loom Over Fed Repo Efforts (9.26.19) WSJ https://www.wsj.com/articles/big-banks-loom-over-fed-repo-efforts-11569490202

A  New Central Bank Approach Pay Banks to Lend (9.17.19) WSJ

https://www.wsj.com/articles/a-new-central-bank-approach-pay-banks-to-lend-11568721602

 

A NEW INTERNATIONAL WIRE SYSTEM

The First Iranian English Economic Daily reported, “Governor of the Central Bank of Iran says Iran and Russia have connected their financial messaging services to handle two-way banking transactions.  Outlining details of his talks with the Russian delegation in Turkey, Abdolnasser Hemmati said banks in both countries are now connected through the Russian SPFS and Iran’s SEPAM. The initiative is to be used as an alternative to payments through SWIFT (Society for Worldwide Interbank Financial Telecommunication) for protection against third country sanctions.

Today the USD represents 60% of world reserves and 80% of global payments.  The reason this very significant is that the US has been able to influence and control any nation using US Dollars, by imposing sanctions and cutting off their ability to transact and wire money in and out of their country using SWIFT codes.  Iran and Turkey now have another way to wire money, effectively circumventing US and EU sanctions.  Reuters reported:

“Russian lawmakers on Tuesday backed the international use of a Russian alternative system for the global financial messaging network SWIFT designed by Moscow to eliminate the risk of Western sanctions.  Russia has held talks with China, India, Iran and Turkey about joint use of Russia’s financial messaging system, said Anatoly Aksakov, who heads the Russian Banking Association and a financial committee with the lower house of parliament.  “As the system has proved to be viable and efficient, it draws interest from both Russian and foreign players, it is proposed to give any legal entities, Russian and foreign, the possibility to use it,

SWIFT, was founded in 1973 and connects more than 11,000 institutions in over 200 countries and territories, it said on its website.  Moscow has also seen interest in joining the Russia-based system from Arab countries and is ready to start negotiations about creating a switch that would connect the Russian system with the European one, Aksakov said. 

This will greatly reduce the ability of the US, the EU and other nations to curtail rogue nations utilizing non-military economic options.  It will also reduce US control over world events and increase the influence and control held by Russia and other nations.

Banks in Iran, Russia Connected via Non-SWIFT Financial Messaging Service (9.18.19) https://financialtribune.com/articles/business-and-markets/99912/banks-in-iran-russia-connected-via-non-swift-financial-messaging

Russia Backs Global Use of its Alternative SWIFT System (9.9.19) Reuters

https://uk.reuters.com/article/russia-banks-swift/russia-backs-global-use-of-its-alternative-swift-system-idUKL8N2163BU

 

CURRENCY

The euro is down, the pound is up, and former partners are distancing themselves from Facebook’s new cryptocurrency Libra.  Gold & silver are up, but buyers of gold should beware as there are counterfeit gold bars being sold in world markets.

MasterCard, Visa, eBay, Stripe Drop Out of Facebook’s Libra Network (10.11.19) WSJ

https://www.wsj.com/articles/mastercard-drops-out-of-facebook-s-libra-payments-network-11570824139

Facebook Scrambles to Keep Libra on Track as Partners Waver (10.1.19)

https://www.wsj.com/articles/visa-mastercard-others-reconsider-involvement-in-facebook-s-libra-network-11569967023

Euro Drifts Toward Its Lowest Level Against Dollar in Years (10.3.19) WSJ

https://www.wsj.com/articles/how-low-can-the-euro-go-11570098097

Fake-Branded Bars Slip Dirty Gold Into World Markets (8.28.19)

https://www.reuters.com/article/us-gold-swiss-fakes-exclusive/exclusive-fake-branded-bars-slip-dirty-gold-into-world-markets-idUSKCN1VI0DD

 

RECESSION & DEBIT

Fannie and Freddie are being released from government oversight and have already been loosening lending requirements to allow more people who don’t meet qualifications to get mortgages.  This sounds eerily very familiar, maybe they should rent The Big Short and watch it to refresh their memories.  According to the WSJ:

Mortgage-finance companies Fannie Mae FNMA 3.26% and Freddie Mac FMCC 3.16%   will start keeping earnings as part of a Trump administration process aimed at moving the companies out of conservatorship and back into the private sector.  Fannie and Freddie are central players in the housing market, buying about half of all U.S. mortgages from lenders and packaging them for issuance as securities. The government effectively nationalized them during the 2008 crisis in a bid to stabilize the housing market as mortgage defaults mounted.”

The US economy is doing well, but there are signs pointing to lurking trouble, like General Electric freezing pension plans for 20,000 workers, the US staring its new fiscal year almost $23B in debt, the Federal Reserve printing and pumping hundreds of billions of dollars into the overnight bank and repro markets, and rising individual debt levels coupled with loosening lending requirements.

General Electric Freezes Pension Plans for 20,000 US employees in an Effort to Reduce Debt (10.7.19) Yahoo News |  https://www.youtube.com/watch?v=CarVrn3JyaA

General Electric to Freeze Pensions for 20,000 Workers (RTD Quick Take) (10.7.19) https://www.youtube.com/watch?v=UorlsmGFuAk&feature=youtu.be

1,015,736,491,184 Reasons to Have a Plan B (10.1.19) SMC https://www.sovereignman.com/trends/1015736491184-reasons-to-have-a-plan-b-25656/?utm_medium=email&utm_source=sm_notes&utm_campaign=notes&utm_content=20191001_debt

The Fed, Banks Printing Money to Prevent Trouble Recession Will Come Soon (9.24.19) GB https://www.glennbeck.com/radio/the-fed-banks-printing-money-to-prevent-trouble-recession-will-come-soon

Fannie, Freddie to Retain Earnings (9.30.19) WSJ  https://www.wsj.com/articles/fannie-freddie-to-retain-earnings-11569851912

 

WORLD MARKETS

U.S. stocks rallied as banks and health-care companies reported stronger than forecasted 3rd quarter results, and a ceasefire was called on the US vs China trade war, at least temporarily.  Services, however, showed a sharp drop globally, and manufacturing also slowed.

The WSJ reported that, “The U.S. plans to swiftly impose tariffs on $7.5 billion in aircraft, food products and other goods from the European Union after the World Trade Organization authorized the levies Wednesday.  “For years, Europe has been providing massive subsidies to Airbus that have seriously injured the U.S. aerospace industry and our workers,” U.S. Trade Representative Robert Lighthizer said in a statement. “Finally, after 15 years of litigation, the WTO has confirmed that the United States is entitled to impose countermeasures in response to the EU’s illegal subsidies.”

Germany’s economy has been drifting toward recession for most of 2019, and their factories continue to preform poorly due to trade wars and Brexit..

Stocks Climb After Strong Results From Banks, Health Sector (10.15.19) WSJ

https://www.wsj.com/articles/u-k-pound-posts-gains-on-brexit-optimism-11571130220?mod=hp_lead_pos1

EU Warns of 5G Risks Amid Scrutiny of Huawei (10.11.19) WSJ

https://www.wsj.com/articles/eu-warns-of-5g-risks-amid-scrutiny-of-huawei-11570814799

Services Stumble Risks Sharper Global Slowdown (10.3.19) WSJ

https://www.wsj.com/articles/services-stumble-threatens-sharper-global-slowdown-11570094948

U.S. to Impose Tariffs on EU Goods After WTO’s Airbus Ruling (10.2.19) WSJ

https://www.wsj.com/articles/u-s-can-levy-tariffs-on-eu-exports-over-airbus-wto-says-11570025040

Stocks Drop on Worries About Growth (10.2.19) WSJ

https://www.wsj.com/articles/global-stocks-fall-amid-rising-fears-of-economic-slowdown-11570004904

Global Stocks Absorb Blow of Manufacturing Slowdown (10.1.19) WSJ

https://www.wsj.com/articles/global-stocks-fall-amid-rising-fears-of-economic-slowdown-11570004904

Germany on Brink of Recession as Factories Slump (9.23.19) WSJ

https://www.wsj.com/articles/germany-on-brink-of-recession-as-factories-slump-11569237721?mod=hp_lista_pos3

 

BREXIT

According to the WSJ, “Mr. Johnson made a significant concession earlier in October when he agreed that Northern Ireland could stay aligned to EU regulations, eliminating the need for regulatory checks on the island of Ireland, with checks being carried out when goods come from Britain into Northern Ireland.  In recent days, Britain has also proposed a special customs partnership that would allow Northern Ireland to effectively remain in the U.K. and EU customs union.

On Oct 16, the UK and EU struck an agreement. Prime Minister Johnson returned to the UK with the deal and parliament voted to approve it, however not the timetable of the deal for an Oct 31st exit.  Hence, although both sides would greatly benefit from this deal, its execution remains uncertain.

Johnson Brexit Deal Clears Hurdle but Timetable Rejected (10.22.19) WSJ

https://www.wsj.com/articles/boris-johnsons-brexit-deal-clears-vital-hurdle-in-parliament-11571768188

U.K. & EU Agree on Draft Brexit Deal, Paving Way for Key Vote (10.17.19) WSJ

https://www.wsj.com/articles/brexit-talks-are-dealt-a-blow-as-northern-irish-party-rejects-draft-11571294766?mod=hp_lead_pos4

Brexit Negotiators Edge Closer to a Draft Deal (10.15.19) WSJ

https://www.wsj.com/articles/eus-barnier-says-brexit-deal-is-still-possible-this-week-11571124007?mod=hp_lead_pos2

 

POLITICAL UNREST

Political unrest continues globally with rioting in Ecuador, Peru, Spain, Iran, Iraq, Russia and Hong Kong.  South Korea launched a ballistic missile, this time from a submarine, as a prelude to new talks with the US.  Turkey who continues to move away from the west towards Russia, started bombing Kurdish forces in Syria as the US declared it was exiting Syria.  The US then imposed more economic sanctions against Turkey, causing them to pause their attack.

Ecuador Begins Cleanup After Nearly Two Weeks of Deadly Protests (10.14.19) WSJ https://www.wsj.com/articles/ecuador-begins-cleanup-after-nearly-two-weeks-of-deadly-protests-11571089214

Spain’s Catalan Separatist Leaders Found Guilty of Sedition (10.14.19) WSJ

https://www.wsj.com/articles/catalan-separatist-leaders-sentenced-for-2017-independence-referendum-11571043234

Iraq Acts to End Deadly Response to Protests (10.9.19) WSJ

https://www.wsj.com/articles/iraq-acts-to-end-deadly-response-to-protests-11570464203

Peruvian Crisis Divides Political Class (10.1.19) WSJ

https://www.wsj.com/articles/perus-armed-forces-back-president-vizcarra-amid-constitutional-crisis-11569937062

One Hong Kong District Becomes a Combat Zone (10.1.19) WSJ

https://www.wsj.com/articles/one-hong-kong-district-becomes-a-combat-zone-11569953252

Turkey Agrees to Pause Military Operations in Syria (10.17.19) WSJ

https://www.wsj.com/articles/pence-leads-u-s-efforts-to-halt-turkey-offensive-in-syria-11571308486?mod=hp_lead_pos1

Turkey Begins Offensive Against U.S. Ally in Syria (10.9.19) WSJ

https://www.wsj.com/articles/turkey-begins-offensive-in-syria-11570627632

U.S. Officials Are Worried About Turkish Foray Into Syria (10.13.19) WSJ

https://www.wsj.com/articles/u-s-officials-are-worried-about-turkey-foray-into-syria-11570103533

North Korea Says it Successfully Tested New Submarine-Launched Ballistic Missile (10.2.19) Reuters https://www.reuters.com/article/us-northkorea-missiles/north-korea-says-successfully-tested-new-submarine-launched-ballistic-missile-idUSKBN1WH2GS

 

EU

Polish and Hungarian election results were another win for nationalism in Europe.  Poland and Hungary have been at odds with the EU for the last two years.  In Austria, another nationalist, former Chancellor Sebastian Kurz, won his election, continuing the rejection of EU establishment candidates across Europe.  German, French and other elections are coming up in the near future and the EU globalists parties are not faring well.

Poland’s Ruling Nationalists Look Narrowly Poised to Return to Power for Another 4 Years (10.11.19) WSJ https://www.wsj.com/articles/polands-ruling-nationalists-eye-new-term-as-voting-begins-11570953095

Austrian Conservative Sebastian Kurz Wins Election (9.29.19) WSJ

https://www.wsj.com/articles/austria-s-conservative-sebastian-kurz-wins-election-with-majority-of-votes-11569771495

What Happened in 2008 & Will it Happen Again? (9.17.19)

video: https://youtu.be/hgK7HR91W9A

In this presentation we discuss:

  • What happened in 2007-2008?
  • What’s happening today that is setting the stage for a repeat?
  • How will “non-performing loans” effect China, the EU, Japan, the US and global markets?
  • Why would a banking crisis today, be far more difficult than in 2008?
  • How does this effect you and what can you do about it?