I was just talking with a very credible candidate for Congress about how an increasingly senile Biden could turn out to be the Democratic nominee; he-- the congressional candidate, not Status Quo Joe-- told me he almost hopes the apocalypse comes soon because he wants to pick up the pieces. Wow! And I thought I was nuts! As speaking of government by the senile, last night, the clownish Trump ran to Sean Hannity on Fox to dispute the WHO report that the death rate for coronavirus is 3.4%, asserting that it's "a false number." Claiming he's "had a lot of conversations with a lot of people," he noted that "They don’t know about the easy cases because the easy cases don’t go to the hospital, they don’t report to doctors or the hospital in many cases so I think that that number is very high. I think the number, personally, I would say the number is way under one percent." Look, I'm no financial advisor but take this warning from me: don't fall into a bull trap. That's when the stock market is plunging and it goes up a bit and fools rush in hoping for a quick profit only to see the plunge continue the following day, taking their investment gamble with it. I think we had one of those yesterday, when the Dow Jones bounced up over a thousand points-- very tempting. Don't do anything crazy today. The Dow headed straight down when it opened this morning and has given back all the fake "winnings" from yesterday.The American government has quite a lot in common with Iran's government, whose response to the pandemic has been characterized as being motivated entirely by pride, paranoia, secrecy and chaos. Have you ever pictured Señor Trumpanzee as a mullah or even an ayatollah?Bloomberg News warned that "It is hard to exaggerate the historic significance of Tuesday’s events in the bond market… According to historical work by Robert Shiller, the Nobel laureate economist at Yale University who has reconstructed the 10-year interest rates available in the U.S. back to 1871, it has never before dropped this low. Many momentous events have shaken the U.S. since Ulysses S. Grant’s presidency, but none of them were sufficient to drive long-term money down to such cheap levels." The Financial Times put it more succinctly: "The 10-year U.S. Treasury yield dropped below 1 per cent for the first time on Tuesday, after the Federal Reserve delivered its first emergency rate cut since the financial crisis in order to stave off the long-term economic impact from the spread of the coronavirus." That was first time-- as in first time ever.That's because markets saw the rate cut-- by a Trump-badgered Fed-- as pure desperation. Canadian financial expert and author Kiril Nikolaev wrote yesterday that emergency interest rate cuts are always bad news for the stock market and-- they're not going to stop this Trump Market from turning into full fledged bear market-- as opposed to a correction. "The Federal Reserve shocked market participants on Tuesday after announcing an aggressive 50-point rate cut. The move was intended to shore up liquidity in an effort to combat the economic impact of the coronavirus. Unfortunately, the big rate reduction did not drive the Dow Jones Industrial Average higher as expected. On the contrary, the index ended the trading day down nearly 3% despite the Fed’s intervention. This indicates that the market is pricing in factors that cannot be solved by loose monetary policies. Over the last two decades, we’ve seen six instances where the Fed reduced rates by 50 basis points or higher. Every single one of them preceded a bear market."
Since 2001, the Fed has been introducing emergency rate cuts of 50 basis points or higher in an attempt to avert a crisis. History tells us that this strategy doesn’t work. If anything, it’s a sign that the stock market is headed for a monumental collapse.In 2001, the Federal Reserve cut rates by 0.5% three times within six months. The stock market dumped over 30% despite the central bank’s intervention.It’s the same story in 2007 and 2008, where the Fed introduced three aggressive rate reductions. The result? A massive stock market collapse of over 50%.It appears that history is showing that emergency rate cuts are desperate measures. The Federal Reserve knows there’s a big crisis coming but its measure likely won’t stop the bleeding.The stock market tanking in spite of the Fed’s emergency intervention is a signal that the risk of the coronavirus to the economy is bigger than anticipated. That statement appears to be true as the World Health Organization (WHO) released new figures regarding the mortality rate of the coronavirus.On Tuesday, WHO officials said that the global death rate for the COVID-19 is actually 3.4%. This number is significantly higher than the previous estimate of 2.3%. The seasonal flu has a mortality rate of 1%.WHO Director-General Tedros Adhanom Ghebreyesus said in a press conference in Geneva, "globally, about 3.4% of reported COVID-19 cases have died."WHO official Dr. Mike Ryan paints an ominous picture of how little we understand about the virus: "Here we have a disease for which we have no vaccine, no treatment; we don't fully understand transmission; we don't fully understand case mortality."In the United States, there are now 122 confirmed cases and nine total deaths. Globally, the number of confirmed cases soared above 93,000.Hedge fund manager Will Meade sums up the magnitude of the impact of the virus to the economy. "The last time the FED did an emergency 50 point rate cut was after Lehman collapse in 2008. Anyone tells you the coronavirus isn't a big deal is either stupid or naive."Coronavirus Could Halve The U.S. Economic Growth This YearAs illustrated, an emergency rate cut often doesn’t bode well for the stock market. Will Meade echoes this view. The former Goldman Sachs analyst said that an emergency rate cut this big means that the economy would tank this year.This sentiment is confirmed by a new Brookings Institution study. Brookings concluded that the mild coronavirus pandemic would wipe out around $420 billion from this year’s growth. In 2019, the current-dollar GDP surged by 4.1% or $848 billion. In other words, the least severe scenario effectively halves 2020’s economic expansion.If worse comes to worst, Brookings projects that coronavirus will obliterate $1.78 trillion from GDP growth. According to the study, global GDP would contract by over $9 trillion in case the global pandemic leads to a “more serious outbreak similar to the Spanish flu.”In either case, the economy and the stock market have a bleak outlook this year. It’s likely that no amount or quantity of rate cuts will stop the Dow Jones from plunging into a bear market.
Wall Street Journal reporters Jennifer Calfas and Mike Cherney are following the steady spread of coronavirus across the U.S. Yesterday saw the 11th fatality-- one in California and 10 inWashington. Leaders of both houses of Congress agreed to an $8 billion package to tackle the disease, including $3 billion to develop treatments. Two mentally deranged right-wing nuts-- Andy Biggs (R-AZ) and Ken Buck (R-CO)-- were the only votes against it.
Soon after the agreement's overall framework was released, lawmakers released the 28-page bill. Two Democratic leadership sources told NBC that the House is expected to vote on the deal later in the day. It will need two-thirds of the House to pass it and leadership expects it to pass with bipartisan support.The bill includes a provision that requires that funds are only used to fight the coronavirus and other infectious diseases as some Democrats feared that the Trump administration could raid the funding and use it for other unrelated purposes.“This should not be about politics; this is about doing our job to protect the American people from a potential pandemic," Senate Appropriations Committee Chairman Richard Shelby said. "We worked together to craft an aggressive and comprehensive response that provides the resources the experts say they need to combat this crisis. I thank my colleagues for their cooperation and appreciate President Trump’s eagerness to sign this legislation and get the funding out the door without delay.”The legislation would provide more than $2 billion to the Centers for Disease Control and Prevention for public health funding for prevention, preparedness and response.It also would allocate more than $3 billion to a public health emergency fund and the National Institutes of Health for research and development of vaccines, treatment and testing of the coronavirus. The bill would also provide nearly $1.3 billion to help protect the health of Americans living abroad from the coronavirus.A House Democratic aide said that the legislation would provide more than "$300 million to help ensure that, when a vaccine is developed, Americans can receive it regardless of their ability to pay.""The legislation ensures that the federal government will only pay a fair and reasonable price for coronavirus vaccines and drugs and provides HHS the authority to ensure that they are affordable in the commercial market," the aide said.
I got an e-mail from the mayor of Los Angeles today-- back from his trip to Dallas to help Biden get elected, thereby destroying America. (Bernie led Biden in L.A. by about 11 points but maybe someone in Dallas gives a shit about what Eric Garcetti has to say. If you've been following our coverage of the pandemic you already know that the official coronavirus numbers are wrong, which is no secret. And we're not just talking about China. The numbers are all wrong in the U.S. too. "The data are untrustworthy," wrote Alex Madrigal, "because the processes we used to get them were flawed. The Centers for Disease Control and Prevention’s testing procedures missed the bulk of the cases. They focused exclusively on travelers, rather than testing more broadly, because that seemed like the best way to catch cases entering the country.
This artificially low number means that for the past few weeks, we’ve seen massive state action abroad and only simmering unease domestically. While Chinese officials were enacting a world-historic containment effort-- putting more than 700 million people under some kind of movement restriction, quarantining tens of millions of people, and placing others under new kinds of surveillance-- and American public-health officials were staring at the writing on the wall that the disease was extremely likely to spread in the U.S., the public-health response was stuck in neutral. The case count in the U.S. was not increasing at all. Preparing for a sizable outbreak seemed absurd when there were fewer than 20 cases on American soil. Now we know that the disease was already spreading and that it was the U.S. response that was stalled.Meanwhile, South Korean officials have been testing more than 10,000 people a day, driving up the country’s reported-case count. Same goes for Italy: high test rate, high number of cases. (Now some Italian politicians want to restrict testing.) In China, the official data say the country has more than 80,000 cases, but the real number might be far, far higher because of all the people who had mild(er) cases and were turned away from medical care, or never sought it in the first place. That may be cause for reassurance (though not everyone agrees), because the total number of cases is the denominator in the simple equation that yields a fatality rate: deaths divided by cases. More cases with the same number of deaths means that the disease is likely less deadly than the data show.The other problem is, now that the U.S. appears to be ramping up testing, the number of cases will grow quickly. Public-health officials are currently cautioning people not to worry as that happens, but it will be hard to disambiguate what proportion of the ballooning number of cases is the result of more testing and what proportion is from the actual spread of the virus.People trust data. Numbers seem real. Charts have charismatic power. People believe what can be quantified. But data do not always accurately reflect the state of the world. Or as one scholar put it in a book title: "Raw Data" Is an Oxymoron.The reality gap between American numbers and American cases is wide. Regular citizens and decision makers cannot rely on only the numbers to make decisions. Sometimes quantification actually obscures as much as it reveals.
This is the letter the mayor's staff drafted for him to send out. Keep in mind that some the information is correct and some of the stuff they've written about the disease is absolutely wrong and not helpful (even if he wasn't a Biden supporter).
Here’s what you should know: COVID-19 symptoms include fever, cough, and shortness of breath-- and may appear as few as two days or as long as 14 days after exposure. Person-to-person spread mainly occurs from contact with an infected person coughing or sneezing (similar to the flu). In rare cases, it may be possible that COVID-19 can be transmitted by touching an infected surface or object.Here’s what the City is doing:• We’ve declared a local state of emergency to access additional resources that will help our region prepare.• We’ve activated our City Emergency Operations Center to a heightened level of vigilance.• The City is working closely with the Los Angeles County Department of Public Health (DPH) and the County Office of Emergency Management (OEM) to share updates, guidance, and information on COVID-19.• All City Departments are reviewing and updating Continuity of Operations Plans to ensure that they can continue delivering essential services in the event of an emergency.• The Port of Los Angeles and San Pedro Bay Complex are on heightened alert. The Coast Guard is assessing all inbound vessels to determine whether the vessel has visited a country impacted by COVID-19 within the last five ports of call. Vessel operators are required to report ill crewmembers and passengers within 15 days of arrival to any U.S. port.• LAX is following the guidance provided by the Centers for Disease Control and Prevention (CDC), Customs and Border Protection (CBP), and L.A. County DPH-- including screening travelers with possible exposure and following best practices to keep travelers and employees safe. This includes installing more than 250 additional hand sanitizer stations and using virus and bacteria-killing disinfectants throughout the airport. We’re cleaning public areas and restrooms at least once every hour, and increasing deep cleaning-- focusing on high touch areas like handrails, escalators, elevator buttons, and restroom doors. We’re also adding signage with information on COVID-19 symptoms and how to reduce the spread of illness.Here’s what you can do:
• Take precautions: If you are sick, stay home. Wash your hands often with soap and water for at least 20 seconds. Avoid touching your eyes, nose, and mouth with unwashed hands. Cover your cough or sneeze. Clean and disinfect frequently touched objects and surfaces. Get a flu shot to prevent the flu, which has similar symptoms to COVID-19. If you have recently traveled in an area with COVID-19 infections and are showing symptoms, monitor your health and seek guidance from a medical professional. Currently, the CDC and DPH are not recommending personal face masks be used by people who do not have prolonged exposure to individuals identified as at risk.• Plan ahead: Living in earthquake country, we know the importance of personal preparedness on any given day. Have extra food, water, medical supplies, and emergency kits in your homes and offices. Talk to your family, friends, and neighbors to develop emergency plans.