5.26.20 - Gold May Reach a Record by Year End
Gold last traded at $1,706 an ounce. Silver at $17.61 an ounce.
NEWS SUMMARY: Precious metal prices eased Monday on profit-taking despite a weaker dollar. U.S. stocks rose sharply as markets cheered signs of economies reopening and a potential new coronavirus vaccine.
Gold may reach a record by year end as investor need creates 'more demand than the market can handle' -Marketwatch
"Gold prices could reach a record by year end, but don't expect to see a smooth ride to the top, even as measures to offset the pandemic-hit economy support the precious metal's appeal as a haven....The most significant supportive factor for gold is the 'amount of debt being created to fund the various global monetary and fiscal deficits,' says Peter Grosskopf, chief executive officer at Sprott Inc. Against that backdrop, gold is experiencing a broad rally, with 'participants ranging from state funds to pensions to [high-net-worth] clients to hedge funds.....'More investors need to add gold as a protection asset in their portfolios,' Grosskopf says. That will 'create more demand than the market can handle,' he says, and with the increasing amounts of monetary accommodation and fiscal deficits, gold could move through its past highs - to $1,900 or $2,000 - by the end of 2020. He refers to gold as a chameleon, as well as an 'anti-confidence thermometer' that 'attaches itself to themes and…does equally well during periods of extreme deflation and inflation.'"
Should You Get Tested For COVID-19? -Zero Hedge
"What is a 'confirmed case' of COVID-19? No. This is not a trick question. It's someone who has tested positive for COVID–19. Meaning, you can be perfectly healthy, test positive, and become a 'confirmed case.' (You are therefore classified as 'asymptomatic.') Everything, therefore, hinges on the PCR tests - the most widely used method today - being accurate. Of course, 100% accuracy is impossible in anything. But the question is, how accurate are they? The rub? Testing an uninfected population will produce only false-positives and no false-negatives....The FDA has approved 33 different PCR tests from separate manufacturers. Problem #1: There's no single standard on what to detect. Some of the FDA–approved tests require only one segment to be present in order to test positive. Others require two. Others require two, but only one needs to be present. Others require three but require two to be present. Others insist all three. Which works best? We have no clue. They're all approved. Problem #2: There's no single standard for cutoff. When used as a test, the PCR technique doesn't produce a binary negative/positive result....The Biggest Problem: We are using these tests as the basis of every decision - local and national. And there's little consistency. In the hospital, for example, the moment someone with symptoms tests positive, they are treated as if they have COVID–19/SARS. This can lead to doctors and nurses jumping to invasive and aggressive treatments, all of which could have serious side-effects....Conclusion: So, until there's some uniformity, sanity, and clarity on the tests… Consider carefully whether or not you actually need one."
Only 50% of Americans believe it's a good time to buy a home, an all-time low -Gallup/Marketwatch
"Americans have quickly soured on the prospects of the nation's real-estate market as the coronavirus pandemic has swept the country. Only 50% of Americans said that now is a good time to buy a home, according to a survey of roughly 1,000 people released Friday by polling firm Gallup. That represents the lowest share of Americans to have a positive view on the country's housing market in the time that Gallup has tracked people's sentiments on real estate...The previous low was set back in 2006 when only 52% of Americans thought it was a good time to buy amid the subprime mortgage-fueled housing bubble. Additionally, only 40% of Americans think that the average price of a home where they live will increase over the next year, down from 62% a year ago....Home sales have come close to a standstill in many parts of the country. Social-distancing recommendations have significantly complicated real-estate agents' ability to market homes, and home buyers face a more complicated process completing all the paperwork needed to buy a property. It has also gotten more difficult to get a mortgage. Sellers, meanwhile, have refrained from listing their homes or pulled them from the market to avoid the possibility of needing to sell at a lower price."
How Upbeat Vaccine News Fueled a Stock Surge, and an Uproar -DNyuz
"When the biotech company Moderna announced early last Monday morning positive results from a small, preliminary trial of its coronavirus vaccine, the company's chief medical officer described the news as a 'triumphant day for us.' Moderna's stock price jumped as much as 30 percent. Its announcement helped lift the stock market and was widely reported by news organizations, including The New York Times. Nine hours after its initial news release - and after the markets closed - the company announced a stock offering with the aim of raising more than $1 billion to help bankroll vaccine development. By Tuesday, a backlash was underway. The company had not released any more data, so scientists could not evaluate its claim. The government agency leading the trial, the National Institute of Allergy and Infectious Diseases, had made no comment on the results. And the stock sale stirred concerns about whether the company had sought to jack up the price of its stock offering with the news. The Moderna episode is a case study in how the coronavirus pandemic and the desperate hunt for treatments and vaccines are shaking up the financial markets and the way that researchers, regulators, drug companies, biotech investors and journalists do their jobs....'You have these wild swings, based on incomplete information,' said David Maris, managing director of Phalanx Investment Partners, and a longtime analyst covering the pharmaceutical industry. 'It's a crazy, speculative environment, because the pandemic has caused people to want to believe that there's going to be a miracle cure in a miracle time frame.'"
5.22.20 - Silver Price Begins To Accelerate
Gold last traded at $1,730 an ounce. Silver at $17.64 an ounce.
NEWS SUMMARY: Precious metal prices rose Friday on safe-haven buying due to rising China tensions, despite a firmer dollar. U.S. stocks fell on investor worry after the Senate passed a bill that would potentially delist Chinese stocks from U.S. exchanges.
Silver Begins To Accelerate Higher Faster Than Gold -FX Empire/Yahoo News
"Precious metals have been on our radar for many months and, if you’ve been paying attention, you probably already know our research suggests Gold and Silver are one of the best investments you can make right now....Both Gold and Silver are making bigger upside price moves with Silver up over 3% while Gold is up 1.3%. We believe this nearly 250% faster Silver advance may be the start of what we have been predicting for many months - an incredible parabolic upside price advance in BOTH Gold and Silver....Our earlier research suggests when this move/setup begins, we could begin to experience a nearly 250% to 350% rally in gold, targeting $3750 or higher, and a 550% to 650% rally in Silver, targeting over $70, over a 12+ month span of time...We believe this SETUP is happening right now and the upside rally in precious metals should begin to really accelerate over the next 5+ months....In 2009, the Gold to Silver ratio level began to collapse from 85 to 32 - well over 50 points (58%). The current Gold to Silver ratio high is nearly 120. Another 58% collapse from that level would suggest the Gold to Silver ratio could fall to 50 (or further) which would indicate that both Gold and Silver could rally extensively throughout the next 12+ months....We don't know where you are going to find many opportunities that beat this setup in Precious Metals right now. This is the trade/setup of your lifetime."
Follow This Investment Trend to Secure Your Wealth for Decades -Dyson/Rogue Economics
"If you've been reading my recent essays, you’ll know that I've been promoting a simple exchange: Sell stocks, buy gold....We are using gold primarily as money - a safe haven - and not as a speculation on higher gold prices. This is why I've put the bulk of my money into physical gold. It's a way to keep us safe while the investment markets correct. This chart shows what I'm talking about. It shows stocks (specifically the Dow Jones Industrial Average) priced in gold. As you can see, the primary trend in the stock market has been DOWN since October 2018, when it peaked at around 22. It's currently around 14. And it's on its way back down to below 5. By owning gold, we set ourselves up to buy stocks at some point in the next five to 10 years at much lower valuations than they are at today. And as such, the only thing that matters is how gold performs relative to stocks. Its nominal price of $1,700 - or whatever it is today - is irrelevant. So if you're worried that you've missed the boat, keep in mind that this trend still has a long way to go. So for the moment, I have the bulk of my portfolio in physical gold....I'm sitting on the sidelines in gold, where I will remain until stocks are ready to beat gold again. And I'll know the time is right by keeping an eye on the Dow-to-Gold ratio....If I'm right about this - and if I time my zigzag correctly - my family will never have to worry about money again."
Will government mandate COVID-19 vaccinations? -The Hill
"If the government determines that vaccinations are essential to stemming the spread of the disease, would it - could it - mandate vaccination compliance? Apparently, it can - and it might. Many medical experts believe that developing one or more COVID-19 vaccines is the key to reopening the economy and returning to our normal lives. For example, the Mayo Clinic says, 'A vaccine to prevent coronavirus disease 2019 (COVID-19) is perhaps the best hope for ending the pandemic.'....The Centers for Disease Control and Prevention (CDC) encourages adults to be immunized for a range of diseases. The flu vaccine leads the CDC's list that includes tetanus and diphtheria every 10 years, shingles, pneumonia and several others. Consider the flu vaccine. It is one of the most affordable and accessible vaccines available, and yet the CDC reports the adult vaccination rate over the past decade has ranged between 40 and 45 percent....While a small percentage of Americans oppose vaccinations on religious or medical grounds, most of the unvaccinated apparently just choose not to. Will a coronavirus vaccine see a higher uptake rate? Maybe. There is a lot of fear among the public, and that may persuade most adults to be vaccinated...If the COVID-19 vaccination rate is low, will the federal or, more likely, state governments step in and mandate vaccination?....Government mandated vaccinations for adults would be a major and controversial step. But then government has taken a number of major and controversial steps recently, such as shutting down the economy. But just because government can do something doesn't mean it should."
Americans Have Rediscovered Self-Reliance -Reason
"When state and local governments first issued pandemic lockdown orders as part of their efforts to slow the spread of COVID-19 pundits debated whether supposedly individualistic Americans would knuckle under. As it turns out, many people initially obeyed, but a lot of us quickly got fed up as restrictions killed jobs and smothered social interactions. If anything, pandemic restrictions fed oxygen to the embers of the individualist, anti-authoritarian tradition. Likewise, the lockdowns have fueled old habits of self-reliance, prompting Americans to relearn skills and revive almost-forgotten habits in ways that, for better or worse, may shape the future. Cooking at home was the first skill to gain new life in a nation that had become increasingly accustomed to take-out, fast food, and sit-down restaurant meals. 'Until recently, learning how to cook, or learning how to cook better, as an adult was considered an aspirational skill akin to learning how to ski - could be nice, might be fun, but would be daunting and could come with potentially expensive start-up costs,' reports the Washington Post....Canning supplies and online lessons in food preservation also took off, as people realized they have to use or store anything they grow....'Sewing machines are one of the top 20 items in demand during this pandemic,' Singer apologetically tells customers wondering about their delayed orders. While they wait for those sewing machines to arrive, Americans are repairing gutters and building shelving units. Confinement at home with time but little money on our hands has 'made us all very handy,' says The New York Times. 'For many homeowners across the country, the coronavirus-imposed quarantine has presented an opportunity to head over to the local hardware store and launch a few D.I.Y. projects around the house.'....Uncertain about the future, Americans are holding on to money rather than spending. The personal savings rate is now 13.1 percent, the highest level since 1981. Worried about the future and stashing cash as a hedge against risk, many - not all, but certainly a good number - of Americans will continue cooking, baking, brewing, gardening, and repairing....In the wake of the crisis will be hard-learned skills and the confidence and sense of self-reliance for using them."
5.21.20 - Will Americans Submit to 2nd Lockdown?
Gold last traded at $1,724 an ounce. Silver at $17.44 an ounce.
NEWS SUMMARY: Precious metal prices eased back Thursday on short-term profit-taking and a firmer dollar. U.S. stocks fell, led by the tech sector, as investors digested rising weekly unemployment data.
Odey Says Governments May Make Private Gold Ownership Illegal -Bloomberg/Yahoo Finance
"Crispin Odey, one of Europe's highest-profile hedge fund managers, said that governments may ban private gold ownership if they lose control of inflation in the wake of the coronavirus crisis. 'It is no surprise that people are buying gold. But the authorities may attempt at some point to de-monetise gold, making it illegal to own as a private individual,' Odey wrote in a letter to investors seen by Bloomberg. 'They will only do this if they feel the need to create a stable unit of account for world trade.'....Fear of government confiscation is a common theme among some of gold's most ardent supporters, who point for precedent to the U.S. government's forced purchases of private bullion holdings in 1933 as part of a devaluation of the dollar. The price of gold was raised from $20.67 an ounce to $35, where it remained until the U.S. ended the gold standard in 1971....Odey, who has previously compared the current pandemic to the Great Depression of the 1930s, argued that central banks would fail to contain inflation as the economy eventually recovers from the impact of global lockdowns. 'History is filled with examples where rulers have, in moments of crisis, resorted to debasing the coinage,' he wrote. Odey is not alone in betting that gold will benefit as high inflation follows the coronavirus crisis."
Will Americans submit to a 2nd lockdown? -Buchanan/WND
"The country, as a whole, is, and has been, opening up. Sunday's New York Times reports that, for weeks now, more than two-thirds of the states have been relaxing restrictions as Trump had urged. The reasons: weariness with the lockdown and sheltering in place, a growing belief that the worst of the pandemic is behind us and undeniably positive news from several fronts in the coronavirus war....The number of deaths has fallen from 2,200 a day in April to closer to 1,400 a day in mid-May...As of Friday, the rate of new cases of the coronavirus was declining in 19 states and rising in only three....Clearly, the opening in many states has been driven by popular protest and public demand. Crowds have ignored social distancing to demonstrate for an end to the shutdown...The protesters seem to be saying: We deplore the losses and know the risks, but we cannot live our lives behind closed doors in our homes until the elites tell us, as though we were children, when we may go out in the yard. Hence, the next question we are all likely to confront: If there is a sudden resurgence of the coronavirus, a second wave, and the media elite and blue-state governors demand a new shutdown...will the people of this republic comply with those demands or defy them? Will the nation answer back to the elites: We did that...But, now, with the shutdown having put 36 million Americans on unemployment and sunk our GDP to Depression-era levels, we're going back to work....The proponents of a second shutdown will be liberal governors and mayors, the mainstream media and the Nancy Pelosi wing of Congress. It should not go unmentioned that the latter's political interests are best served the longer the shutdown endures and the worse the economic situation on Nov. 3. If the economy has failed to begin a robust recovery by fall, the greater the odds that Joe Biden wins the White House. Yet, even if the pandemic returns in the fall, the establishment cannot keep the country closed indefinitely."
Nearly Half of U.S. Households Have Lost Income Since Lockdowns Started -Wall Street Journal
"Nearly half of American households have lost income in the two months since the coronavirus pandemic led to a nationwide economic shutdown and more than a third expect to lose income over the next four weeks, the Census Bureau said in a new report....The first round of results showed the breadth of the economic dislocations attributable to efforts to slow the spread of the pandemic. They also show an expectation that the pandemic will continue to hurt households despite the steady reopening of economic activity in states across the country. Among the hardest hit were states heavily reliant on tourism or the energy industry, industries that have seen sharp declines as a result of the pandemic....Younger households and those with lower incomes or education levels were also more likely to report they lost income, the data showed. Earlier this month, the Labor Department said roughly 20.5 million jobs disappeared in April, pushing up the unemployment rate to a record 14.7%."
Let's Make This Crisis the (Grand) Mother of Invention -Freedman/Philanthropy
"'Stay home, stay safe.' When it comes to the heightened vulnerability of America's elders in the face of Covid-19, these are often wise words. But the unwritten injunction might as well be 'Stay home, stay safe, and stay out of the way.'...The insidious implication is that older people are exclusively the objects of service, helpless not helpers, anything but essential. What a contrast to the thousands of older doctors, nurses, and health care workers who are working the front lines, many of them coming out of retirement to do so. Reminders, all of them, of older adults' vast reservoir of experience and how desperately it's needed today. Nowhere is the need more dire than in the lives of America's children. Already acquiring the moniker of Generation C (for Covid), millions of young people have had their schooling upended....Where to turn for help? The one natural resource in this country that is both untapped and growing: older people. The ones who have no interest in staying out of the way...It's a match as old as time. Researchers have shown that the needs and assets of the generations fit together like the pieces of a jigsaw puzzle....The Harvard Study of Adult Development shows that these bonds are a key to happiness in later life. Older people who connect with younger ones, the study shows, are three times as likely to be happy as those who fail to do so. And happiness is just the start. Other research underscores that older mentors, tutors, and 'community grandparents' - unrelated but no less devoted - reap significant gains to their physical and mental health from spending time with kids....With so many grandparents unable to hug their grandchildren - it might be hard to envision how older people can step up to nurture millions of other people's kids. But crisis can be the (grand) mother of invention. To help stop learning losses - the so-called Covid slide - caused by school shutdowns, nonprofits across the country are working hard to move tutoring and mentoring programs online. Mentor and iCouldBe have joined forces to create the Virtual Mentoring Portal, a free tool to help nonprofits move mentoring relationships online....Our generation has not done all we can for the next one. But it's not too late to turn that around - with innovative ideas, programs and technologies, and the power of millions of people who want to stay safe but refuse to stay out of the way any longer. Let's come forward, roll up our sleeves, and help young people navigate the rocky road ahead."
5.20.20 - Cash Under Suspicion
Gold last traded at $1,750 an ounce. Silver at $17.99 an ounce.
NEWS SUMMARY: Precious metal prices rose Wednesday amid economic uncertainty and a sharply lower dollar. U.S. stocks rose on upbeat retail earnings, as traders continue to grapple with market volatility this week.
Gold gains as recession looms even as economies reopen -CNBC
"Gold prices rose on Tuesday on uncertainty over how economies would emerge from a deep slowdown...'All the fundamentals for gold have never been better in history. Unless we have more optimism about the vaccine, we will begin to see an upward momentum to a new high,' said Jeffrey Sica, founder of Circle Squared Alternative Investments. 'There's continued concern about these pockets of outbreak around the world... any news of a setback in re-integration of businesses into the economy will ultimately lead gold higher.' Massive global stimulus measures to limit the economic damage caused by lockdowns and business suspensions to limit the spread of the coronavirus have supported gold, since it's widely viewed as a hedge against inflation and currency debasement....'We're looking at a weaker economic outlook, massive central bank measures and tensions on the geopolitical front, which should keep gold prices high,' said Saxo Bank analyst Ole Hansen."
Four Long Cycles Align: Our Fate Is Sealed, Vaccines Won't Matter -Charles Hugh Smith Blog
"We like to think we're in charge and that technology conquers all, but history moves in cycles that are larger than any person, corporation, elite or (gasp) technology...The study of cycles is the study of human nature as it plays out in long-term social, political and economic dynamics....The Covid-19 pandemic is the final kick into the abyss. Triggers of collapse can overlap, of course, accelerating the final decline, and hence our interest in long-wave cycles that align in the present era. All complex, tightly bound systems are intrinsically fragile and prone to disruption; we don't see the fragility or vulnerabilities until the decline has reached the terminal phase. The higher up the wealth-power pyramid the observer is, the more prone they are to a magical-thinking belief that the status quo is forever, even as it is crumbling around them. Let's consider the four overlapping/aligning cycles depicted on this chart... The four cycles depicted are: 1. The cycle of credit expansion and contraction, which is now in the final blow-off stage of unsustainable credit expansion (bubble) which will inevitably lead to renunciation of debt (credit collapse) and global depression. 2. The generational cycle (4 generations or approximately 80 years) of American history which leads to nation-changing social, political and economic upheaval (The American Revolution: 1781 +80 years = Civil War, 1861 +80 years = 1941, World War II + 80 years = 2021) as described in the book The Fourth Turning. 3. The 100+ year cycle of price inflation and stagnation of wages' purchasing-power, which began around 1901 is now reaching the final stage of widespread turmoil, shortages, famine, conflict and crisis. 4. The demographic cycle: the workforce stops expanding and starts shrinking while the population of dependent elderly explodes higher, triggering a decline in earnings and the tax base just as taxes must increase to pay for the care of the rising population of elderly.....The future won't be as placid, secure and predictable as the status quo would have you believe."
Cash, long a refuge in uncertain times, now under suspicion -Associated Press
"In troubled times, people have been known to hoard currency at home - a financial security blanket against deep uncertainty. But in this crisis, things are different...This time cash itself, passed from hand to hand across neighborhoods, cities and societies just like the coronavirus, is a source of suspicion rather than reassurance. No longer a thing to be shoved mindlessly into a pocket, tucked into a worn wallet or thrown casually on a kitchen counter, money's status has changed during the virus era - perhaps irrevocably. The pandemic has also reawakened debate about the continued viability of what has been the physical lifeblood of global economies: paper money and coins. From the supermarkets of the United States and Japan to the shantytowns of Africa to the gas stations of Tehran, a growing number of businesses and individuals worldwide have stopped using banknotes in fear that physical currency, handled by tens of thousands of people over their useful life, could be a vector for the spreading coronavirus. Public officials and health experts have said that the risk of transferring the virus from person to person through the use of money is minimal. That hasn't stopped businesses from refusing to accept currency, and some countries from urging citizens to stop using banknotes altogether....'Cash combined with courage in a crisis is priceless,' billionaire investor Warren Buffett says."
30% Of Americans Have Raided Retirement Savings During Coronavirus Lockdown -Study Finds
"The coronavirus lockdown has caused an economic crisis that's taking a toll on many Americans. Not only are their wallets getting thinner but a new survey shows that three in ten Americans have dipped into their retirement savings to help cover their expenses. MagnifyMoney commissioned a survey of 1,239 Americans who have retirement accounts...The survey shows that 30% of Americans have withdrawn an average of $6,757.20 from their retirement savings from about March 1 through May 1. Another 19% responded that they have not taken money out yet but they plan to do so. About a third of respondents have tapped into another investment account instead of retirement. Just over 50% of the people who are making withdrawals from their retirement accounts are doing so to help cover their expenses during the lockdown. A quarter of respondents are withdrawing money after losing their job....The survey also reveals how people have been spending the retirement money they're withdrawing. Sixty percent are using their savings pay for groceries, 42% to pay for bills, 31% on rent and mortgage payments and 27% on debt payments....Nearly half of the people who normally save for retirement have changed their savings plan during this time. About one in five (21%) have reduced their retirement contributions and another 26% have put their contributions on pause. Analysis by generation shows that 53% of baby boomers, the generation closest to using their retirement savings, have stopped contributing entirely."
5.19.20 - Gold: Longest Winning Streak Since 2011
Gold last traded at $1,744 an ounce. Silver at $17.87 an ounce.
NEWS SUMMARY: Precious metal prices rose Tuesday on safe-haven buying and a weaker dollar. U.S. stocks fell ahead of testimony by Treasury Secretary Mnuchin and Fed Chairman Powell to Congress on the economic response to the coronavirus pandemic.
Gold Soars as Fed Sounds Warnings on Asset Prices, US Recovery -FX Empire/Yahoo
"Bullion has now gained about 11.7 percent since March 31 and is set to post a 7th straight quarterly gain, which is the longest such streak since 2011. From a fundamental perspective, the gold surge appears to have been triggered by warnings out of the Federal Reserve about potential asset price declines if the coronavirus 'pandemic takes an unexpected course, the economic fallout prove adverse, or financial system strains reemerge'. Fed chair Jerome Powell also mentioned in a recent interview that the US economy's recovery might last through the end of 2021, provided a reliable Covid-19 vaccine can be rolled out by then. Such comments out of the world's most influential central bank adds to the risk aversion among global investors who are clearly flocking to the safety that Bullion offers....Bullion bulls are relishing any opportunity to push gold prices higher, with $1800 appearing to be just around the corner."
The U.S. Is in a Generational Economic Cycle -Bonner/Rogue Economics
"In the Panic of 1857, the yield on the U.S. 10-Year Treasury Note rose to 6.6%. It took a lifetime for it to reach the next top, in 1920. Then, another 61 years passed before the next top came along. In other words, these are generational trends. One generation learns....Now, we learn - again - why, for 180 years, U.S. dollars were linked to gold, rather than simply to promises from the U.S. government. In a nutshell, it's because the generation of 1791 (when the U.S. dollar first appeared) knew something the generation of 2020 has forgotten: Power corrupts. And the power to create 'money' is so irresistible that no race, no nation, no genius, and no government official has ever resisted it for long....First, they created an impaired economy, already on fake-money life support. Then, they shut it down in order to stop the spread of a virus. As a result, sales, profits, earnings, jobs, tax revenues - all are collapsing. We've already seen that the Universal Lockdown was one of the most monstrous mistakes ever made by public officials. The odds of death are 1,000 times greater for an 80-year-old man than for a 30-year-old female. It would have been relatively easy to protect the vulnerable groups (including your editor) until the threat had passed. Simply tell them the truth! Most of the codgers are already retired anyway...It would have cost the economy very little....Retail sales figures for April show the biggest drop in 70 years....Bar and restaurant incomes have been cut in half. One out of four restaurants is not expected to ever reopen. Private schools and universities, too… towns, counties, and state governments… households - Chapter 11 is going to be the most searched-for term on Google....Neither Wall Street nor Washington has even begun to reckon with the damage. But all of that is just prelude to the real catastrophe. Next up: We find out that printing fake money to cover the losses is an EVEN WORSE idea. America’s paper money system began on August 15, 1971, when Richard Nixon somberly announced the end of the Bretton Woods system that fixed the U.S. dollar to gold. We're 49 years into it already. In 10-20 years, the cycle should be complete. By then, prices should be rising at 50% or more per year. And if we're right, the fake dollar - the green piece of paper that is in your wallet - should be history."
The Pandemic's Geopolitical Aftershocks Are Coming -The Altlantic
"With most European countries confident that they are past the worst of the coronavirus pandemic, their attention is turning to the chance of its resurgence once society returns to some semblance of normal...The geopolitical second wave, and its power is already starting to concern Western leaders. Imagine a scenario: Just as Europe and the United States begin to feel as if they have the coronavirus under control, it takes hold in the developing world. Exhausted, indebted, and desperate for their own economies to get back up to speed, richer countries are too slow to help. Panic ensues...Somewhere, a state defaults on debt held largely by Western financial institutions. In the chaos, an autocrat eyes an opportunity for a land grab. A United States already unwilling to take the lead leaves China to step into the void....The array of possible second-wave consequences is dizzying: the prospect of the disease taking hold in a developing G20 country - think India - which could see the virus quickly doubling back to Europe and the U.S.; the uncertain impact of technological advances in fields such as artificial intelligence as they are used to help combat the disease's spread; a recession pulling at the ties between the European Union's poor south and wealthy north....More than anything, though, for Western governments there is a simple underlying reality to the geopolitical second wave: cash, or a lack of it. 'You've got more problems but less money to deal with them,' one senior adviser to the British government, who asked for anonymity to speak candidly about internal deliberations, told me....Whether the pandemic brings about revolutionary change or simply accelerates the currents already working under the surface, the fact is that the epidemiological second wave isn't the only one we need to worry about."
Moderna's coronavirus vaccine shows encouraging early results -Washington Post
"Moderna, the Massachusetts biotechnology company behind a leading effort to create a coronavirus vaccine, announced promising early results from its first human safety tests Monday. The company plans to launch a large clinical trial in July aimed at showing whether the vaccine works. The company reported that in eight patients who had been followed for a month and a half, the vaccine at low and medium doses triggered blood levels of virus-fighting antibodies that were similar or greater than those found in patients who recovered. That would suggest, but doesn't prove, that it triggers some level of immunity....The data released Monday by Moderna is encouraging, but represents only a first step in a long process to bring a vaccine to market. It comes from an interim report on dozens of patients followed over weeks, whereas vaccine studies require broad testing in thousands of patients followed over many months or years....The interim data comes from a clinical trial aimed at showing the safety of its experimental vaccine and helping the company select the correct dose. The company has not yet picked the final dose, or announced the size or length of the large trial that it will start in July, which will be the key one that regulators consider to decide whether the vaccine is safe and effective."
5.18.20 - Will CV-19 Force You To Retire Early?
Gold last traded at $1,736 an ounce. Silver at $17.49 an ounce.
NEWS SUMMARY: Precious metal prices rose Monday on safe-haven buying and a weaker dollar. U.S. stocks rebounded as news from a Moderna trial stoked investor optimism about a potential coronavirus vaccine.
Gold, Silver Higher on Fear of Second Virus Wave -Bloomberg
"Gold jumped toward its peak in April, when prices hit the highest since 2012, after bleak U.S. government data underscored how hard coronavirus-related shutdowns have hit the world's largest economy. Friday gold futures posted the highest close to a week since October 2012 after U.S. factory production plummeted in April by the most in records back to 1919, and a gauge of U.S. retail sales plunged through the record set just a month earlier. 'Everybody must have realized it, but it's just more evidence that the reality is this is a pretty bleak economic picture right now,' Phil Streible, chief market strategist for Blue Line Futures LLC, said by phone. 'People are continuing to pile into gold because that weak economic picture is going to continue to drive interest rates lower.' Silver also got a stronger bid, rallying to the highest in over two months. The two precious metals have been lifted after Fed Chairman Jerome Powell warned last week that the pandemic will take a heavy toll on the economy. ....Nations that enjoyed success quelling the virus, including South Korea and China, now face a rising number of infections. In the U.S., Texas saw its deadliest day and its biggest jump in new cases since the start of the outbreak. That comes two weeks after controversial moves to reopen the state's economy."
Will You Be Forced To Retire Early Because Of The Coronavirus? -Forbes
"We are being asked to stay home thanks to the COVID-19 pandemic. This disease may be forcing many worker to stay home for much longer than they want, perhaps turning a layoff into a forced retirement....Under normal circumstances, millions of Americans have had to retire early. With the economy at a near standstill due to the COVID-19 stay-at-home orders, many workers may be forced into early retirement. Most people think the full retirement age is 65...Seventy is the target for those looking to get the absolute largest monthly retirement income from Social Security. As a financial planner, I am fortunate to be working with many business owners who plan to never retire because they have so much passion for what they do....According to a recent survey by Allianz Life titled, '2020 Retirement Risk Readiness Study,' many Americans won't have much flexibility in choosing when they leave the workforce and enter retirement. More than half of workers will be forced out of the workforce earlier than expected and for reasons out of their control. By the way, the survey was conducted in January 2020 before the full weight of the coronavirus hit the U.S. economy. From the study, 34% of respondents said they left the workforce because of an unanticipated job loss...Another 25% percent of respondents listed health issues as the reason for retiring....People are worried about running out of money in retirement. According to the survey, 60% of respondents said that was their biggest concern while 55% of non-retirees were concerned they wouldn't have enough saved by the time they retired. I was not surprised to see that worry wasn't translated into action....There is no better time than now to get started planning for your dream retirement. Social Security will not provide enough income for most of you to live comfortably."
Pandemic Bills Are So Big That Only Money-Printing Can Pay Them -Bloomberg/Yahoo Finance
"Forced into record spending by the threat of another Great Depression, policy makers are blurring the lines between borrowing the money they need and simply creating it...Those barriers began to look porous after the financial crisis of 2008. And in the coronavirus slump, they've all but disappeared. With entire industries shuttered and unemployment soaring, only public spending is keeping millions of households and businesses afloat. The governments on the hook for this relief effort are running up some of history's biggest budget deficits. 'We've had a merger of monetary and fiscal policy,' says Paul McCulley, the former chief economist at Pacific Investment Management Co. 'We've broken down the church-and-state separation between the two.'....Behind the longstanding taboo against what is known as 'monetizing debt' lies the fear of inflation. History is full of episodes when politicians grabbed control of the printing presses and splashed too much money around the economy, causing prices to spiral out of control and eroding the real value of all kinds of savings, from bank accounts to bond portfolios....There was no real alternative, according to Stephen Roach, a senior lecturer at Yale. 'The economy is in the biggest hole it's ever been in, so we need massive fiscal stimulus,' he said. 'The central bank has to be brought in to fund it.' That doesn't mean there are no consequences, said Roach, a former nonexecutive chairman of Morgan Stanley in Asia. In the U.S., the Fed-backed spending spree means that 'inflation is likely to begin moving up post-virus,' he said."
U.S. Adults Report Less Worry, More Happiness -Gallup
"As many states have begun to reopen their economies and many more are making plans to do so, Americans are reporting improvements in their emotional health. Although the coronavirus crisis persists, less than half of U.S. adults (47%) now say they worried a lot of the previous day - down from 59% in late March/early April, when Gallup recorded an unprecedented increase in self-reported worry. In addition to the 12-percentage-point drop in worry, boredom has dipped five points, to 41%, and happiness has edged up five points, to 72%....These findings are from an online, probability-based Gallup Panel survey that has tracked Americans' emotional wellbeing during the coronavirus pandemic since March 23. The latest data are from interviews conducted April 27-May 10, as a number of states started lifting stay-at-home orders and business restrictions. Just as Americans' views of many aspects of the COVID-19 situation differ by demographic subgroup, so too do their emotions during this unprecedented crisis. In particular, the greatest differences in emotions are seen by household income, party identification, marital status and gender. Bottom Line: The pandemic has taken an emotional toll on the public, as self-reported worry soared during the first month of restrictions put in place to limit the spread of COVID-19. In recent weeks, however, Americans have experienced less negative emotions and have reported an increase in happiness. Although much of the country is now taking steps to embark on a path to some kind of normalcy, more than 80,000 Americans have lost their lives as a result of the disease, and COVID-19 cases are still on the rise in a handful of states. The trajectory of Americans' emotional wellbeing may depend greatly on what happens with the disease as restrictions are eased."
5.15.20 - Billionaires Sounding Alarm About Stocks
Gold last traded at $1,751 an ounce. Silver at $17.00 an ounce.
NEWS SUMMARY: Precious metal prices rose further Friday on safe-haven buying and a weaker dollar. U.S. stocks traded mixed following a record 16.4% plunge in April retail sales and rising trade tensions between China and the U.S.
Powell Sends a Message With Love for Gold -FX Empire/Yahoo Finance
"Jerome Powell gave a speech yesterday at the Peterson Institute for International Economics. The Fed Chair acknowledged the unprecedented depth of the coronavirus crisis, and its disastrous impact for the US labor market....There are three key takeaways from Powell's speech...1) The Fed Chair rejected the idea of negative interest rates. He noted that the evidence on the effectiveness of these monetary policy experiments conducted by the Bank of Japan and the European Central Bank 'is very mixed'....2) Powell acknowledged...the V-shaped rebound is unlikely and there are important downside risks on the way to recovery...'The path ahead is both highly uncertain and subject to significant downside risks.' These grim words pushed the stock markets down on Wednesday. Importantly, Powell noted that the longer the recession takes, the more problematic it might become, as 'the passage of time can turn liquidity problems into solvency problems.' The implication is that the safe-haven demand for gold should remain robust for a while, and gold is still a good portfolio's diversifier....3) Powell suggested that the Fed's policy toolkit could expand in the future. He said that while the Fed's response to the crisis 'has been both timely and appropriately large, it may not be the final chapter'....It means that we could see more fiscal deficits and even higher federal debt in the near future."
Wall Street Heavyweights Are Sounding Alarm About Stocks -Bloomberg/Yahoo Finance
"The biggest names in finance are coming around to a view that seemed unlikely a few weeks ago: Stocks are vastly overvalued. Legendary investors Stan Druckenmiller and David Tepper were the latest to weigh in after a historic market rebound, saying the risk-reward of holding shares is the worst they’ve encountered in years. Druckenmiller on Tuesday called a V-shaped recovery - the idea the economy will quickly snap back as the coronavirus pandemic eases - a 'fantasy.' Tepper said Wednesday that next to 1999, equities are overvalued the most he's ever seen. It's a notion catching on among Wall Street money managers. And it's coming as investors start to suspect that the Federal Reserve's support, as well as $3 trillion in Treasury stimulus, may not be enough to compensate for soaring unemployment, a wave of bankruptcies and no end in sight to the pandemic. Managers including Bill Miller, Paul Singer and Paul Tudor Jones have all voiced doubts about markets or the economy. Such bearishness starkly contrasts with the optimism that pushed the S&P 500 Index up 26% from its March low....Federal Reserve Chair Jerome Powell, Trump's pick for the job, outlined a doom-laden scenario with mass bankruptcies and unemployment in a speech delivered Wednesday....Tepper, who runs the $13 billion Appaloosa hedge fund, told CNBC on Wednesday that valuations are 'nuts' for some individual stocks on the Nasdaq....Other marquee investors also have taken more defensive stances recently. Tudor Jones, who runs Tudor Investment Corp., told clients in early May he was investing in gold."
What the Pandemic Revealed: a Morally Bankrupt Culture -Charles Hugh Smith Blogspot
"What was 'normal' for the past two decades was to turn a blind eye to the moral and financial bankruptcy of the American culture, the rot at the heart of its social, political and economic orders. The pandemic has shredded the putrid facade and revealed the rot....What's been absolutely verboten is to call legalized pillage and predation what they really are: evil....By stripping fraud and predation of moral consequence, we've covered the putrid rot with a thoroughly modern amorality which we can summarize as anything goes and winner takes all....The greater the outrage of the technocrats and monopolists at being called what they are - evil - the greater the confirmation that the accusation is spot-on. The predators, looters and exploiters must strip away any moral assessment of their actions, as even the smallest shred of moral or karmic justice threatens their empires....Monopolies and cartels are evil because they are exploitive by their very nature. This is why the political system imposed anti-trust legislation in the early 20th century....Dear shareholders and monopolists: the banquet of consequences is being served. Don't choke on the cold serving of karma."
Creativity Flourishes, Even Amid a Pandemic -Reason
"It was going to be the party of the year: my 50th birthday. I rented a fantastic place, picked a great menu, and sent funny invitations...I was counting down the weeks. Then COVID-19 hit. Lockdowns were ordered. No party for me. Yet what replaced it was the purest expression of the best that humanity has to offer, springing from creative forces that neither this virus - nor other negative forces - can kill....And what replaced the party was so much more meaningful and amazing because it was fueled by my friends' love and creativity, and by the amazing innovators who make coping with the isolation more tolerable. When I woke up, I was greeted by a video from my oldest friend in France: a fun musical performance of the 'Happy Birthday' song performed with a piano and homemade instruments, recorded on an iPhone and sent over the Atlantic Ocean in mere seconds, free of charge. None of that would have been possible had I turned 50 in 2007. Then came the Zoom family reunion with cousins in three countries, three continents, and two hemispheres. While Zoom was created in 2011, the company has quickly become a household name and a business essential during the pandemic....Remarkably, I drank in this love and well-wishing all from the comfort of my bed. I soon discovered another gift at 11 a.m...As I opened my front door, I discovered a beautiful sign wishing me a happy birthday. It was festooned with balloons and cupcakes right there in my front yard, all orchestrated by my loving friends Ashley and Kevin....In the end, nothing surprised me more than the way my friends managed to reinvent my birthday celebration in this time of pandemic with a giant drive-by caravan of honking, decorated cars filled with cheering from people I cherish....I will never forget it, and I will always marvel at people's endless ability to love, connect, and create."
5.14.20 - Lockdown: A Luxury Many Americans Can't Afford
Gold last traded at $1,738 an ounce. Silver at $16.13 an ounce.
NEWS SUMMARY: Precious metal prices rose Thursday on safe-haven buying amid downbeat economic data. U.S. stocks fell sharply - extending their steep losses this week - as investors digested the coronavirus' devastating toll of 36 million lost jobs in the past eight weeks.
Companies' Next Coronavirus Challenge: Getting Cash-Strapped Shoppers to Spend -Wall Street Journal
"Companies like Kellogg, Hershey and Nestle are tapping the lessons of the last recession as they seek ways to keep newly frugal consumers from trading down. The makers of shampoo, cereal, frozen pizza and other supermarket staples are working to woo shoppers who are cutting back on spending, as tough economic times set in....'We've studied what worked well and what did not in past recessions and how this one could be different,' Kellogg's Chief Executive Officer Steve Cahillane recently told investors. 'We're preparing ourselves.' Preparing for a downturn this time around is tougher, executives say, because the potential for wider spread or a second occurrence of the new coronavirus isn't yet known. Consumer-products companies are already scrambling to meet surging demand for household essentials while operating factories at lower capacity because of worker sickness or social distancing....The Covid-19 recession is expected to be deeper and more global than the financial crisis of 2008-09. The International Monetary Fund has forecast the world economy would shrink by 3% this year, compared with a contraction of 0.1% in 2009....'A significant number of American households are not working and experiencing meaningful financial pressures,' said CEO Michele Buck. 'Their shopping priorities have changed.'....'Some of the mistakes made across categories in recessions is a hunkering-down mentality,' said Kellogg's Mr. Cahillane. 'People still want good news. People want fun. They want to try things in an affordable way.'"
Why Gold Is Your Best Bet -Dyson/Rogue Economics
"Why gold? Have a look at this chart. It tracks the gains in gold prices and the Dow since 2000… You can see that since valuations started their long walk down the mountain in 2000, gold has outperformed stocks 5-to-1....The Dow-to-Gold ratio is the ultimate barometer of systemic 'health.' It tracks the 30 Dow Jones stocks, as priced in gold. And it tells us the best time to buy gold… and the best time to buy stocks....For example, the high in the Dow-to-Gold ratio in 1999 (when it took more than 40 ounces of gold to buy the Dow) mirrors the towering peak in stock valuations… right before the dot-com crash in 2000. At its most recent high in October 2018, the Dow-to-Gold ratio was just above 22. It's been falling ever since… a signal that the system is going to break soon. Maybe it's started to break already? Since the outbreak of the coronavirus pandemic, the government has gone into hyperdrive trying to 'manage' the economy - with more financial engineering, more unsound money, bigger deficits, and more soothing words…As I write, the Dow-to-Gold ratio is at 13.9. I expect it to fall below 5 - what Bill Bonner calls its 'rendezvous with destiny' - in the next five to 10 years. Until then, we're sticking with gold."
Why Restarting the Global Economy Won't be Easy -Georgia Tech
"As the world contemplates ending a massive lockdown implemented in response to COVID-19, Vinod Singhal is considering what will happen when we hit the play button and the engines that drive industry and trade squeal back to life again. Singhal, who studies operations strategy and supply chain management at the Georgia Institute of Technology, has a few ideas on how to ease the transition to the new reality. But this pandemic makes it hard to predict what that reality will be....COVID-19 represents a new kind of mystery when it comes to something as complex and critical to the world's economy as the global supply chain, for a number of reasons that Singhal highlighted: 1) The global spread of the virus and duration of the pandemic. 'We have no idea when it will be under control and whether it will resurface,' Singhal said....2) Both the demand and supply side of the global supply chain are disrupted. 'We're not only seeing a lot of factories shutting down, which affects the supply side, but there are restrictions on demand, too, because you can't just go out and shop like you used to, at least for the time being,' he said....3) Longer lead times. 'We get close to a trillion dollars of products annually from Asian countries, about $500 billion from China,' Singhal said...Logistics and distribution has been disrupted and needs to ramp up again will increase lead time....4) Supply chains have little slack, and little spare inventory...Small and medium sized companies in China 'have less than three months of cash. Many of these companies may go bankrupt,' he added."
The coronavirus lockdown is a luxury many Americans can't afford -New York Post
"This month there has been a distinct dissonance in the national atmosphere - even more so than usual, which is saying something. It went from resigned despair to collective rage and protests. Protests which, for the most part, are not unreasonable....People like Texas salon owner Shelley Luther - who peacefully opened her hair salon in Dallas despite a stay-at-home order in a state with 34,000 cases of COVID-19 and 946 deaths. She was sentenced to seven days in jail and a $7,000 fine but the judge told her he would commute her sentence if she admitted her actions were selfish - to which she replied (while wearing a face mask): 'I have to disagree with you, sir, when you say that I am selfish because feeding my kids is not selfish. I have hair stylists that are going hungry because they'd rather feed their kids'…..Luther was jailed although the state's attorney general and governor called for her release, which came two days later. AG Ken Paxton said: 'I find it outrageous and out of touch that during this national pandemic, a judge, in a county that actually released hardened criminals for fear of contracting COVID-19, would jail a mother for operating her hair salon in an attempt to put food on her family's table.'....Working-class and blue-collar people, many of whom live month to month, are destitute right now. Mortgages and rent are due and there are miles-long lines for food banks in several states....Since COVID hit, 33 million Americans have sought unemployment....I am scared of COVID-19. But I am even more terrified about what is coming after the rage of millions tears this country apart. Because for many Americans, the lockdown is a luxury they can't afford."
5.13.20 - TRACE Act: Devilish Gov't Surveillance Plot?
Gold last traded at $1,718 an ounce. Silver at $15.69 an ounce.
NEWS SUMMARY: Precious metal prices rose Wednesday on Fed's promise of additional stimulus plans. U.S. stocks traded mostly lower following downbeat remarks from Fed chairman Jerome Powell amid jitters about reopening the economy.
Gold Prices: Undervaluation, Smart Money Piles Up -Market Realist
"In times of uncertainty and fear, gold usually rises due to its safe-haven demand. Currently, to avoid the looming slowdown due to COVID-19, central banks engage in an easy money policy...The move will have ripple effects through economies, most of which are positive for gold. On one hand, economic stimulus packages will lead to currency devaluations, which should prop gold up. On the other hand, easy money, without any corresponding rise in output, will lead to inflation. This scenario is positive for gold. Now, hedge funds have also started jumping into gold....According to Financial Times, Elliott Management’s Paul Singer told his clients that gold was 'one of the most undervalued' assets currently and its fair value is 'multiples of its current price.' Many other market participants including ANZ bank also think that gold is undervalued and could push higher. Gold prices are undervalued compared to equities....Apart from hedge fund managers, analysts are also making a case for gold. Bank of America expects gold prices to reach $3,000 per ounce in 18 months."
After Coronavirus, Government Will Have to Shrink -Harper/Wall Street Journal
"In the response to the coronavirus pandemic, leftists see a model for the future. 'Not only will America need a massive dose of big government to get out of this crisis,' one wrote, 'but we will need big, and wise, government more than ever in its aftermath.' As a conservative, I'm going to argue the opposite...A new era of big government in the economy is unlikely, undesirable and far from inevitable....So why doesn't this herald a new age of big government? It's simple: All this intervention has been economically ruinous. No amount of money can fully compensate for social-distancing actions whose effect is to shut down large segments of the economy. Tens of millions have lost jobs, and many thousands have lost businesses. In most cases, compensation from the state is a fraction of what they were earning. Many of the measures are necessary to combat Covid-19, although we will be able to evaluate them with any certainty only after the crisis. Yet there's little doubt that the economic damage is staggering....When focus shifts from the pandemic to the economy, it will need to shift from a lot more government action to a lot less. People turn to government for security. Conservatives understand that security is fundamental to why government exists. Right now, as in wartime, we face extreme needs for physical and financial security. But as needs shift to jobs, growth and wealth creation - and those needs will be enormous - it will require more market activity and a bigger private sector, not more intervention and bigger government....'Modern monetary theorists' will prattle on about how with low interest rates and monetary expansion this does not matter. Their core belief - that governments can never really run out of money - is nonsensical....Despite the unsustainable nature of today's spending, opposition this time may even be stronger. Many workers have been reduced to limited stipends by government-ordered shutdowns, leading to renewed calls for a 'guaranteed minimum income.'....Governments that resist restoring free enterprise and fiscal responsibility will experience recession and stagnation. Those that do the right things will lead their countries to a far more prosperous future."
'First bonds, then stocks' - Investors could get hit with two crashes by end of the year -Fund Manager/Marketwatch
"On Feb. 27, Michael Gayed called for a double-digit drop on the S&P 500. He followed that timely prediction in March with a forecast for a melt-up in stocks at the end of the month....If he's got it right again, the pain is far from over for investors. 'Risk-off is about to return in two waves - first bonds, then stocks. Two crashes,' Gayed, who also publishes the Lead-Lag Report, told MarketWatch. He explained that he sees a 'significant risk' that the yield curve steepens in a way that will shock markets and trigger a crash in Treasurys. 'Reflation bets are increasing everywhere, and oil printing a negative price in the face of that suggests there is a very real feeling that global central banks and governments will stop at nothing to counter the deflationary forces of staying at home,' Gayed said...'Combined with unlimited QE, which in the past has caused yields to rise, it looks like bonds collapse first before stocks.'....As for the timeline, Gayed said it could all take place before year's end. 'This feels like a home construction project. It's going to cost more money and take longer than any estimates,' he said of the pandemic. 'In the absence of a vaccine, behavior's changed in a way that will make any longer-term gains unjustified no matter how much money Papa Powell prints.'"
H.R. 6666 a devil of a COVID-19 government surveillance plot -Washington Times
"A House resolution from Illinois Democrat Rep. Bobby Rush that would put Big Government in charge of tracking citizens' movements as they relate to COVID-19 mitigation efforts - even sending health bureaucrats to 'individuals' residences, as necessary,' as the legislation states - has a most apt number: 6666....After all, what's more devilishly un-American than launching one of the most massive government surveillance programs of private citizens in U.S. history, all under the guise of protecting people from the coronavirus? That’s the 'COVID-19 Testing, Reaching, And Contacting Everyone (TRACE) Act' in all its $100 billion grant giveaway glory. According to H.R. 6666's text: The taxpayer funds will be used to 'trace and monitor the contacts of infected individuals, and to support the quarantine of such contacts, through mobile health units and, as necessary … at [citizens'] residences.' That means government comes to your home, taps on your door and demands you take a COVID-19 test. And if you test positive, that means the government makes sure you stay at home. How? Good question....'Reopening our economy and getting back to normal will be all but impossible if we do not step up our testing efforts and implement robust and widespread contact tracing,' Rush said in a statement on his House webpage....Be afraid; be very afraid. The resolution has dozens of cosponsors."
5.12.20 - Economic Recovery Won't Be V-Shaped
Gold last traded at $1,706 an ounce. Silver at $15.70 an ounce.
NEWS SUMMARY: Precious metal prices rose Tuesday on safe-haven buying and a weaker dollar. U.S. stocks traded mixed as investors evaluated the latest attempts to reopen the economy.
Gold To Shine One Way Or The Other -Seeking Alpha
"Gold has put up stellar returns since 2000 thanks to the exponential growth of central bank largess....For bearish investors who think the worst is yet to come, gold historically delivered precious returns when stocks raced from peak to bottom....During the worst S&P500 drawdowns of the last century...gold clearly has proved a precious hedge during the market selloffs....The real interesting observation is that gold performed better during the recovery phase after the stocks bottomed than during the sell-off phase. This is evident when looking at the absolute returns: median gold return during the recovery phase: 73% vs. 6-12% median return during the selloff....Therefore, gold can be a good portfolio allocation for both market bulls and bears because they don't need a crystal-ball-forecast of the stock market bottom. Nobody has a crystal ball."
Strangeness of the day: For Americans, an in-between moment -Associated Press
"In coming years, when they write the narrative histories of the 2020 pandemic - those paperweight-level volumes that reconstruct these strange days in painstaking and vivid detail - the past week in American life will be a particularly curious moment to unpack. It was unlike what came before, and almost certainly unlike what is still ahead....Job numbers confirmed what everyone already suspected: the worst unemployment rate since the Great Depression. The face mask evolved from a piece of protective equipment into a political litmus test....Right now, Americans are the insects, caught in amber, suspended for an uncertain moment between the isolation of a national shutdown and the revving up of a much-disputed return....The utter weirdness of this part of the COVID-19 storyline is its own distinct kind of crazy, where the road map has run out and the next page of the script is blank....Part of the problem, of course, is that those very circumstances have left many millions of people stuck in their homes with a lot of opportunity to contemplate their lot - and contemplate, and contemplate, and contemplate....Of course, the very existence of an in-between moment suggests two bookends. The first has already been laid down - and, for the fortunate, lived through. The second lies ahead. Will it provide clarity? That depends on this uniquely curious moment, and where it leads."
Why the Economic Recovery Will Be More of a 'Swoosh' Than V-Shaped -Wall Street Journal
"Until recently, many policy makers and corporate executives were hoping for a V-shaped economic recovery from the coronavirus pandemic: a short, sharp collapse followed by a bounce back to pre-virus levels of activity. Now, however, they expect a 'swoosh' recovery. Named after the Nike logo, it predicts a large drop followed by a painfully slow recovery, with many Western economies not back to 2019 levels of output until late next year - or beyond. The sobering new view reflects the depth of the contraction now being recorded for the spring, as well as more evidence that soaring joblessness and months or years of social distancing will depress economic activity well into next year. 'This is not going to be a quick recovery,' said Mark Schneider, chief executive of Nestle SA, the world's biggest packaged foods maker, recently. 'This is going to be a several-quarter, if not several-year kind of process.'....Consumer goods companies anticipate that shoppers will switch to cheaper items and forgo splurges, likely remaining tightfisted long after lockdowns end. Some corporations have already announced fresh layoffs for the fall, prolonging the joblessness surge that has already left more than 30 million Americans unemployed....According to a survey by market research group Coresight Research, more than 70% of Americans expect to avoid some public spaces after the lockdowns ease, with more than half saying they expect to stay away from shopping malls...The outlook is so uncertain that a string of large companies have suspended financial guidance for the year....'There is no such thing yet as a new normal. Nobody has the faintest idea of what the new normal looks like,' said Unilever CEO Alan Jope....It's a fair bet that the global economy is going to be deeply challenged in the years ahead."
Which Covid-19 Data Can You Trust? -Harvard Business Review
"The Covid-19 pandemic has created a tidal wave of data. As countries and cities struggle to grab hold of the scope and scale of the problem, tech corporations and data aggregators have stepped up, filling the gap with dashboards scoring social distancing based on location data from mobile phone apps and cell towers, contact-tracing apps using geolocation services and Bluetooth...In the face of uncertainty, these data can provide comfort - tangible facts in the face of many unknowns....However, incomplete or incorrect data can also muddy the waters, obscuring important nuances within communities, ignoring important factors such as socioeconomic realities, and creating false senses of panic or safety, not to mention other harms such as needlessly exposing private information. Right now, bad data could produce serious missteps with consequences for millions. While you may not be qualified to evaluate the particulars of every dashboard, chart, and study you see, there are common red flags to let you know data might not be reliable. Here's what to look out for: 1) Data products that are too broad, too specific, or lack context....Even data at an appropriate spatial resolution must be interpreted with caution - context is key....2) The technologies behind the data are unvetted or have limited utility. Tech solutions such as mobile phone-based contact tracing have untested potential, but only as part of a broader comprehensive strategy that includes a strong underlying health system....3) Models are produced and presented without appropriate expertise. Well-meaning technologists and highly influential consulting firms are advising governments, and consequently businesses and general populations around the world, on strategies to combat the epidemic....This pandemic has been studied more intensely in a shorter amount of time than any other human event...It is inevitable that there will be bad as well as good data in that mix. These massive, decentralized, and crowd-sourced data can reliably be converted to life-saving knowledge if tempered by expertise, transparency, rigor, and collaboration. When making your own decisions, read closely, trust carefully, and when in doubt, look to the experts."
5.11.20 - 3 Reasons Gold Prices Are Exploding
Gold last traded at $1,698 an ounce. Silver at $15.68 an ounce.
NEWS SUMMARY: Precious metal prices held steady Monday despite a firmer dollar. U.S. stocks fell amid investor jitters about reopening the economy too soon.
3 Reasons Gold Prices Are Exploding - And Why the Party Isn't Over Yet -CCN
"Since careening below $1,500 an ounce on March 19, the price of gold has been rising steadily. It's already surged past $1,700, and some analysts believe it could set a new record above $2,000 within the imminent future. Here are three reasons why the yellow metal is soaring in 2020 - and why the party isn't over yet. 1. Gold Is (Still) a Safe-Haven Asset Against Global Uncertainty - Many investors view gold as a safe haven during crises like the coronavirus. Fear of a global economic downturn is driving investors towards the safety of the yellow metal....2. Fed's Stimulus Measures Fuel the Yellow Metal - The U.S. Federal Reserve's massive stimulus to support the economy is another factor that promises to drive gold prices higher. When central banks print more money in an attempt to stimulate the economy, it can increase inflation....3. Fears of a U.S.-China Trade War Make Gold a Solid Long-Term Hedge - Global political tensions should provide long-term support for gold prices even after the coronavirus crisis is over...As Trump and Beijing play the COVID-19 blame game, a trade war is becoming a growing possibility."
Americans Need Hope as Well as Safety -Noonan/Wall Street Journal
"Our economy is experiencing a great contraction...it's becoming smaller, tighter, more airless. As a nation we have rightly focused on the illness that caused all this and the fight to beat it back. That fight can't let up. When the disease goes down in one place it shows up in another, and a second or third wave is likely; viruses like this don't knock on the door just once. But the economic contraction will have repercussions as destructive as the virus itself. People will die and sicken because of lost jobs, lost income and a feeling of no opportunity, no possibility. Alcoholism, drug abuse, anxiety, suicide, strife within families - all these things will follow. And there's a feeling of terrible generational injustice. My generation is on pause, but the young are on stall, and it's no good for them....We have to see the unfolding economic calamity in a new, more present and urgent way, and think about its impact on our culture, our ability to fund things, our standing in the world, our morale....The bias now should be toward opening, doing everything we can to allow the economy to become itself again, to the degree that's possible. Toward that end, two thoughts from two wise men. The first is that we must unleash the creativity of businessmen and women, an uncalled-on brigade in this battle. Not only doctors and scientists will get us out of this, business must be on the lines, too. Second, we have to cooperate by doing the things that contain the illness so that businesses can stay open and functioning....The first wise man is George Shultz, a participant in and observer of history to whom I spoke by phone...'We have a potentially vibrant private sector. There's an immense amount of energy and ingenuity and fresh thinking there...We have to open things up and say to the private sector, 'Do your job.' They have creativity, they want to get things up and going again.' The second wise man: Ken Langone, a founder of Home Depot...'There is a bigger risk in business not being open than in staying closed,' he said by phone...'It isn't safety or business, it's safety right now which allows business.'....I want to get back to the national morale. All these dreadful economic numbers - you can't let people sink into defeatism...People need hope. Americans live on it. We must return to life. That is where the bias must be."
The Fairy Tale of Monetary Control -Snider/Real Clear Markets
"In the thirties, the government and central bank together took square aim at creating inflation so as to prevent further widespread deflationary economic damage. They never achieved it, nor did they measure a proper recovery. In the sixties, they took square aim at creating tightening so as to prevent further widespread inflationary economic damage. They never achieved that one, either, nor did they properly measure the monetary system for all its 'missing money.'....What was so striking, to me, in seeing A Controlled Expansion of the Currency in the Senate record is the fairy tale of control, how long it has been around and how it can be taken right to the extreme. It lingers in human imagination because we all want to believe, at times desperately, that it's within our collective grasp to tame wild forces we don't necessarily understand and mostly don't appreciate....For many, the very ideal of technocracy and therefore the possibility of utopia is more than a dream. Why on Earth anyone today would associate those with a central bank, particularly our central bank, defies everything logical and rational....There are now only really two mainstream sides to the current predicament; first, that the government and the Fed are going to push too far and unleash the inflationary monster because, well, they can and they want to....On the other side are those who think officials will thread the needle perfectly, and that the current 1932-style contraction we'll easily transit because of the finely crafted, expertly executed policies of those who don't mind telling you they learned everything they know from studying the Great Depression....When the government does everything in its legitimate power, and a great deal that isn't, to create inflation so as to get out of deflation, the deflation wins. When the government does everything in its legitimate power, and a great deal that isn't, to defeat inflation it didn't see coming, the inflation wins....The technocracy, to say nothing of its methods (statistical models), has always been a total sham."
We Need National Service. Now. -Brooks/New York Times
"There is now a vast army of young people ready and yearning to serve their country. There are college graduates emerging into a workplace that has few jobs for them. There are more high school graduates who suddenly can't afford college. There are college students who don't want to return to a college experience. This is a passionate, idealistic generation that sees the emergency, wants to serve those around them and groans to live up to this moment. Suddenly there is a wealth of work for them to do: contact tracing, sanitizing public places, bringing food to the hungry, supporting the elderly, taking temperatures at public gathering spots, supporting local government agencies, tutoring elementary school students so they can make up for lost time. Dr. Tom Frieden, former head of the Centers for Disease Control and Prevention, has said we will need as many as 300,000 contact tracers alone....There's a good bill winding its way through the Senate to do precisely that, led by Chris Coons, a Democrat from Delaware...As a young man, Coons launched one of the first AmeriCorps programs, leading 150 members in 15 cities who tutored students in inner-city schools. Later, he created another AmeriCorps program with a local volunteer fire department in Delaware. 'It was the most inspiring thing I've ever been a part of,' Coons told me. His bill would double the current number of AmeriCorps volunteers in its first year, from 75,000 to 150,000. Then for years two and three it would double the number again, to 300,000. It would also increase AmeriCorps stipends, which are now as low as $15,000 a year, so the volunteers can have a living wage. The Coons bill is an excellent start. But it needs to be bigger and bipartisan. Under AmeriCorps, the federal government provides money for the volunteers, matched by private funding....There's no reason this shouldn't happen. Eighty-eight percent of Democrats and 74 percent of Republicans support voluntary national service. According to a Columbia University study, every dollar invested in national service produces about $4 in benefits. The number of young people who want to take part in national service always vastly exceeds the number of slots....As my mentor William F. Buckley once put it, 'Materialistic democracy beckons every man to make himself a king; republican citizenship incites every man to be a knight.' We have a generation of knights in waiting."
5.8.20 - "Cash Is Trash" In Post-COVID World
Gold last traded at $1,713 an ounce. Silver at $15.79 an ounce.
NEWS SUMMARY: Precious metal prices gave back some of their recent gains Friday despite a weaker dollar. U.S. stocks rose as investors looked beyond record high 14.7% unemployment and bet that the worst had now passed and more stimulus is coming.
Gold jumps 2% as US jobs data adds to slowdown fears -CNBC
"Gold prices jumped 2% on Thursday after a string of weak economic data, including surging unemployment in the United States, heightened fears over a coronovirus-induced global downturn, while investors turned their attention to nonfarm payrolls for further cues....'You had high unemployment (numbers) that came out....That's still telling people to maybe look for the safety trade,' said Michael Matousek, head trader at U.S. Global Investors. Millions more Americans sought unemployment benefits last week, suggesting layoffs broadened from consumer-facing industries to other segments of the economy and could remain elevated even as many parts of the country start to reopen. Another set of data on Thursday showed worker productivity dropped at its fastest pace in more than four years in the first quarter amid the largest drop in hours since 2009. The host of gloomy economic data has bolstered expectations of more stimulus measures from central banks and governments around the world to cushion economic damage from the virus....The outbreak has infected more than 3.71 million people globally, battered global growth and prompted investors to seek safe havens such as gold."
"Remember, Cash Is Trash" In A Post-COVID World -Zero Hedge
"There's been a concerted effort recently among the oligarchs I like to call The Davos Crowd to demonize cash. From hedge fund manager Ray Dalio pronouncing 'Cash is trash' earlier this year to the fear-mongering surrounding COVID-19 making people fearful of dealing in cash because it might be tainted the anti-cash rhetoric has been amped up to eleven. And it's been no secret that the elite of the world want us to stop transacting in cash because it is something they can't track....But the reality is that the push for removing cash from society is to put all of our financial dealings in databases which gives authorities a record of everything you do...The reason for this demonization of cash has as much to do with the understanding that the current global financial system is broken and will need a global coordinated bailout....The dollar reserve standard is in the process of dying. The great financialization of the world and the multiple levels of credit bubbles its engendered are bursting. People are open to alternatives. And in the great game of global capital a country only has to be slightly better than the current dominant player to attract the lion's share once the outflows begin. China is positioning itself to be a bigger player here but the IMF, governed and controlled by the U.S., is not the solution....The easiest way to effect that is to be able to create digital money at the stroke of a keyboard....And it will be the discipline of cash tied to real assets, birthed from human toil but free from human manipulation that will return sanity to our markets and local economies. That's what a hard currency is."
The economy is in free fall. So why isn't the stock market? -Vox
"The stock market is doing fine, even though everything else is definitely not. Earlier in the coronavirus crisis, Wall Street had a meltdown. Stocks plunged amid fears of the disease's spread and its potential impact on the global economy, sometimes to the point that trading was halted altogether to rein in the chaos...And given the state of the world - a deadly global pandemic with no end in sight, 30 million Americans recently out of jobs, an economy that's fallen off of a cliff - a relatively rosy stock market is particularly perplexing. Sure, the stock market isn't the economy, but right now, it seems particularly divorced from what's happening on the ground. 'The gap between markets and economic data has never been larger,' wrote Matt King, global head of credit strategy at Citigroup....The Federal Reserve and, to a perhaps lesser but still significant extent, Congress have taken extraordinary measures to pump money into the economy and prop up markets....Moreover, investors don't really have a lot of places to go with their money - government bonds are offering super-low returns, if much at all. Among some on Wall Street, there's a fear of missing out, and it appears retail investors have been playing the markets while in quarantine. To be sure, there's no guarantee this market rally will last, nor that investors have it right....One theme of the coronavirus crisis is that anyone who tells you they know what's about to happen next is lying, and that holds when it comes to the stock market....'Beware of the oddity in this bear rally,' Andrew Lapthorne, global head of quantitative research at Societe Generale, wrote in a recent note. 'Given the overall negative undertone from the economic challenges ahead, the dramatic reversal of global markets after the pandemic lows is more puzzling.'... 'There's a very real possibility that people could get washed out, not just retail investors, but everybody.'"
Students To Get Graduation Pomp At Drive-In Theater -NPR
"Amid all the disappointments and cancellations for high school seniors this year because of COVID-19, many schools around the nation are scrambling to salvage at least some sort of graduation for the class of 2020. Many are considering holding ceremonies online or staging some sort of drive-by celebration. 'To not have [graduation] just doesn't seem right to us,' says Ken Freeston, schools superintendent in North Salem, N.Y. North Salem High School Principal Vince DiGrandi agrees. 'Absolutely, they've earned it,' he says...They started brainstorming last month for ways to get seniors some pomp, despite the circumstance...Eventually, they came up with another, more novel idea - to hold graduation at a venue about an hour north of the school....As soon as they inked the contract, the school released a video announcing the plan. On the screen, DiGrandi calls for a drumroll, describes the news as bigger than 'Armstrong landing on the moon,' and cuts to the two senior class advisers singing along to 'Stranded at the Drive-In' from the movie Grease. North Salem High School graduation 2020 will take place at a drive-in theater on June 22. 'Oh, my God! That's awesome!' senior Kayley Decina squealed, and immediately declared the plan even more fun than a regular graduation. 'I've literally been crying every day about not having a graduation and not seeing my friends,' she said. 'So I think having this last hurrah is really going to help. And it means a ton.' Kids are already planning to decorate their cars. They are limited to one per family, and if they have a sunroof they can pop through to cheer and toss their caps. The valedictorian's speech will blare from the drive-in's 56-foot-wide screen in high definition...And while North Salem's 103 graduates may not get to walk, DiGrandi plans to march from car to car, passing out diplomas from a proper social distance....It didn't take long to settle on which movie would be most appropriate to show. 'Groundhog Day,' exclaimed DiGrandi. 'Because it kind of feels that way for these kids.'"
5.7.20 - "Gold About to Surge" - Hedge-Fund Billionaire
Gold last traded at $1,725 an ounce. Silver at $15.59 an ounce.
NEWS SUMMARY: Precious metal prices rose sharply Thursday on safe-haven buying and a weaker dollar. U.S. stocks rose above break-even for the year driven by tech sector gains as investors bet the U.S. economy would reopen soon.
Disconnect Between Markets And Reality Hits Idiotic Levels -Zero Hedge
"One month ago, with the S&P500 staging an impressive V-shaped rebound from the March 23 lows after the Fed unleashed a nuclear bomb of monetary stimulus, we showed that forward stock multiples had surged right back 19.4x, which was just above the level the S&P500 held on Feb 19 when it was trading at an all-time high above 3,330. In other words, at in the first week of April, stocks were valued the same as they were at the February all time highs. Fast forward one month when two things have happened: stocks have risen further, with the S&P rising just shy of 3,000 last week, while earnings expectations across the entire world have continued to slide...19.4x forward P/E is now even more idiotic...Deutsche Bank's Torsten Slok said: 'It is difficult to think about the E in the P/E ratio when the economy is shut down and half of blue-chip companies don't want to provide guidance on full-year earnings because of all the uncertainty. The Fed probably doesn't worry much about if the forward multiple is 18, 20, or 25, their clear goal is to support markets.'...The 'disconnect between markets and data is the largest on record'."
The stock market may get cut in half, but this ‘most undervalued’ asset is about to surge, billionaire investor says -Marketwatch
"Paul Singer, the hedge-fund billionaire behind Elliott Management, warned last month that the ultimate path of global stock markets is a drop of at least 50% from February highs. What's an investor to do in the face of such a grim outlook? Load up on gold...After all, according to a report this week from the Financial Times, that's what the smart money's doing. Gold, advised Singer, is 'one of the most undervalued' assets available and it's worth 'multiples of its current price' due to the 'fanatical debasement of money by all of the world's central banks.' His fund gained about 2%, the FT reported, thanks primarily to profits from its gold position. Andrew Law's Caxton Associates and Danny Yong's Dymon Asia Capital have joined Singer in seeking protection in their gold positions amid further loosening monetary policy. 'Gold is a hedge against unfettered fiat currency printing,' said Yong, whose fund is up 36%."
Stay Shut Down or We'll Sue -Editors/Wall Street Journal
"Governors are moving to reopen their economies, and Congress could at least do its part. That includes passing the liability protections that business owners need to feel confident they won’t be looted by lawsuits as they get back to work. The plaintiff bar is trying to cash in almost as quickly as the coronavirus has spread. Trial lawyers are filing suits against emergency-supply manufacturers (false advertising), colleges (refusal to refund student fees), cruise lines (emotional distress), retailers (wrongful death), nursing homes (negligence), and governments (denial of hazard pay)—and much more. There is little point in lifting lockdowns if employers don't open for fear of lawsuits. A number of governors used emergency powers to grant liability protections to health-care workers. But trial lawyers will attempt to get friendly state courts to invalidate them...The better answer is for Congress to pass legal protections related specifically to the pandemic and economic recovery that set a national standard and limit the trial bar's ability to forum shop class actions in friendly state courts....The answer is to restrict lawsuits to individuals who sustain 'serious physical injury' - perhaps defined as a permanent impairment of health, or situations that require medical intervention to preclude such an impairment....Also needed are protections for health providers, including those who use new treatments in their frantic efforts to save lives. Lawsuits should have to prove gross negligence....Congress has passed nearly $3 trillion in virus spending for hospitals, struggling businesses and state and local governments. The money should be used to save jobs and businesses, not be siphoned into trial-lawyer bank accounts. The government lockdowns put the economy into a deep recession. Now government has a duty to help businesses reopen without fear of crippling litigation."
COVID-19 is redefining what it means to be professional -Fast Company
"It's hard to maintain a level of professionalism when you work from home, especially when you have young kids or pets...COVID-19 has put us all in the same situation, juggling work and family while trying to appear competent. And things are loosening up as a result. 'What does professionalism mean when our personal lives are in turmoil?' asks Jason Wingard, dean and professor of the School of Professional Studies at Columbia University and author of Learning to Succeed: Rethinking Corporate Education in a World of Unrelenting Change. 'Many of us are working from basements and kitchens. We're caring for kids and, in some cases, parents. And we're all experiencing this surreal time together.' 'Being on Zoom with leadership teams sitting in odd places like attics with dogs barking and kids walking in - on one hand it's weird, and on the other hand it's refreshing,' says Mike Robbins, author of We're All in This Together: Creating a Team Culture of High Performance, Trust, and Belonging....While corporate culture has been evolving and relaxing over the past 5 or 10 years, COVID-19 is accelerating the process for industries that have stuck to traditional formalities, says Robbins....Seeing a more complete picture of your coworkers can promote empathy and understanding within teams. 'Maybe we'll all feel more comfortable sharing insights of our lives in a way we hadn't done before - more than simply a picture of our family on our desk,' says Wingard. Working from home has also forced people to be more creative and flexible. 'On video you can't hide,' says Robbins...The more authentic you feel in your work environment, the freer you are to create, says Robbins....The old ideas of what it means to be professional may be gone forever. 'This is a new normal, and we have to accept it,' says Wingard. 'The more kids, doorbells, cats, and dogs that become an operational part of our day, the more acceptable it will become. Keeping that separate is not realistic.'"
5.6.20 - Gold: An Investment For Times Like These
Gold last traded at $1,691 an ounce. Silver at $15.08 an ounce.
NEWS SUMMARY: Precious metal prices slipped Wednesday on profit-taking and downbeat jobs data. U.S. stocks traded flat after ADP reported private payrolls were cut by 20.2 million last month.
Gold as an investment is made for times like these -Dillian/Marketwatch
"You absolutely do want to own some gold, especially now....I'll be frank: I would like the U.S. to return to a gold standard, but that is never going to happen. So we're stuck in a world of unlimited quantitative easing (QE) and other Fed funny business. Which means this is a world where you want to own gold....The fact is, gold has maintained its purchasing power over a huge span of history, and that isn't likely to change....And, given the government's reckless monetary actions - including its foray into modern monetary theory (MMT) - it's going to perform well long after the acute phase of this crisis passes....Gold is bound to keep rising in this environment. Because the Fed can print an infinite number of dollars, but it can't print gold....Gold has a lot going for it: QE, inflation fears, and a giant budget deficit, to name a few. However, the biggest reason to own gold is that it smooths out the volatility in your investment portfolio. Add a little bit of gold, and you'll pretty much get the same overall returns. But you'll cut your volatility in half. This is why I encourage my readers to allocate 20% of their investment portfolios to gold."
Welcome Back to the Office. Your Every Move Will Be Watched. -Wall Street Journal
"Many Americans heading back to the factory and the office as the coronavirus pandemic eases will soon begin to notice that their every move is being watched or recorded. PricewaterhouseCoopers LLP said it is preparing to launch this month a phone app for employers that traces contacts by analyzing workers' interactions in the office...Advertising giant Interpublic Group of Cos . is exploring dividing its 22,000 U.S. employees into three separate groups, according to perceived health risks, which could include age. Workers could be asked to disclose medical and other personal information about themselves and, in some cases, family members....The arrival of Covid-19 is taking surveillance to a higher level, with some employers planning to track movements and gather personal information like never before in Western democracies. It marks a new chapter in the debate over privacy, and the trade-offs people are willing to make for safety. Some companies now see the measures as perhaps the only way to reopen offices without risking a new rise in infections, at least until a vaccine becomes available....Massachusetts-based health-care software company Athenahealth Inc. is considering checking the temperatures of employees but doesn't want to track their movements. 'We trust our employees,' said Fran Lawler, Athenahealth's chief human resources officer. 'I think our employees would feel like that is a bit invasive.'....Existing employment laws that protect against discrimination by age or disability still apply in a pandemic, and asking all employees to disclose health information could open a company to legal liability, said Jennifer Merrigan Fay, an employment-law partner at Goodwin Procter LLP."
Some retailers are too broke to go bankrupt -CNN Business
"The coronavirus pandemic is making retail bankruptcies more likely. But, ironically, it could also make bankruptcies more difficult, and lead to delayed filings. With much of the United States still limiting nonessential businesses, and with shoppers nervous about visiting open stores, closing sales are much more difficult to hold. On Monday, J.Crew became the first national retailer to file for bankruptcy during the crisis. Experts say they're certain it won't be the last. But they also say many retailers are likely holding off filing until they are able to make plans for the stores they need to close during bankruptcy....Numerous national retailers are reported to be close to a bankruptcy filing. JCPenney (JCP) disclosed on April 15 that it missed a debt payment...According to published reports Neiman Marcus also is close to filing....Most major companies that file for bankruptcy do so intending to stay in business. But many fail, including Toys 'R' Us and Sports Authority. Once a company files for bankruptcy, the clock is ticking on its effort to win approval of the bankruptcy court to stay alive....The problems facing traditional brick-and-mortar stores didn't start with the Covid-19 crisis. A record 9,275 major retail stores announced closings last year, according to CoreSight Research. Things will only be tougher for traditional retailers in the months ahead, with many customers struggling during a period of record job losses. The growing use of online shopping during stay-at-home orders doesn't help either."
How people react to the threat of disease could mean COVID-19 is reshaping personalities -The Conversation
"The effects of the coronavirus pandemic will be 'imprinted on the personality of our nation for a very long time,' predicted Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases....Psychological research suggests that concerns about COVID-19 and social distancing are likely to affect how much people want to socialize with others, what they desire in partners and relationships, and their preferences for more conventional thinking over openness to new experiences....Like the physiological immune system, the psychological behavioral immune system is flexible - when you perceive some infection risk, it triggers responses to minimize the danger. One such response is withdrawing from other people and becoming less social....Cultural norms and practices provide guidelines for how to behave to prevent the spread of disease. Whereas prior to COVID-19 a person sneezing in public might receive a polite 'gesundheit,' now it elicits fear. Break the 'six feet' rule and you risk an angry exchange, or worse. The risk of coronavirus is highlighting people's ability and willingness to follow guidelines for the sake of the community, promoting individuals' collectivistic side....The U.S. is only a couple months into social distancing. But COVID-19 is already shaping behavior. People are less social. Dating patterns are disrupted. Effects are emerging even in people's closest, most established relationships. The longer the coronavirus threat lingers, the more these changes may reflect not just changes in momentary behaviors, but changes to more enduring aspects of people's personalities."
5.5.20 - Why U.S. Coronavirus Data is Terrible
Gold last traded at $1,716 an ounce. Silver at $15.17 an ounce.
NEWS SUMMARY: Precious metal prices traded mixed on safe-haven demand despite a firmer dollar. U.S. stocks rose with oil prices as investors bet the U.S. economy could start to reopen again.
Gold: Planting The Seeds Of Inflation And Food Shortages -Seeking Alpha
"We are seeing a lot of volatility because of some recent fundamental news that just came out...The crisis is unmatched since the 1930s. There is growing pressure to lift restrictions that are choking the economy. We are beginning to see the ripple-effect damage of this economic bomb caused by the pandemic...There are glimmers of hope. Some new testing of a drug, Remdesivir, is showing promise for treating COVID-19....Now we are beginning to see more buyers coming into the gold market...It is a very good level to start buying the market. A buy signal has been activated in gold....You have to understand the difference between the physical and paper markets. The two are separate. The paper market is the futures market and is based on contracts for 100 ounces of gold, supposedly....The physical gold market, however, has now completely separated itself from the paper market. There are a large number of open interest positions in gold, which are looking to take delivery of physical gold through the futures market. COMEX is in a jam because the number looking to take delivery are at record numbers, so they are scrambling to find the gold to meet their obligations....Central bankers can no longer manipulate the price of gold. The world is looking to take delivery of physical gold, which is more than offsetting attempts to suppress the price of gold via the paper market. When hyperinflation hits, it will happen overnight. Be prepared."
How Long Will a Vaccine Really Take? -New York Times
"A vaccine would be the ultimate weapon against the coronavirus and the best route back to normal life....We've never released a coronavirus vaccine for humans before. Our record for developing an entirely new vaccine is at least four years - more time than the public or the economy can tolerate social-distancing orders. But if there was any time to fast-track a vaccine, it is now. Normally, researchers need years to secure funding, get approvals and study results piece by piece. But these are not normal times. There are already at least 254 therapies and 95 vaccines related to Covid-19 being explored. Despite the unprecedented push for a vaccine, researchers caution that less than 10 percent of drugs that enter clinical trials are ever approved by the Food and Drug Administration. The rest fail in one way or another: They are not effective, don't perform better than existing drugs or have too many side effects....The potential Covid-19 vaccines now in the pipeline might be more likely to fail because of the swift march through the research phase, said Robert van Exan, a cell biologist who has worked in the vaccine industry for decades. He predicts we won't see a vaccine approved until at least 2021 or 2022, and even then, 'this is very optimistic and of relatively low probability.'....So researchers might produce a viable vaccine in just 12 to 18 months, but that doesn't mean you're going to get it....Once we have a working vaccine in hand, companies will need to start producing millions - perhaps billions - of doses, in addition to the millions of vaccine doses that are already made each year for mumps, measles and other illnesses. It's an undertaking almost unimaginable in scope."
Coronavirus Data in the U.S. Is Terrible, and Here's Why -City Lab
"Every day now comes with a new set of coronavirus data: numbers for positive tests, negative tests, deaths, patients hospitalized, ventilator shortfalls and hospital beds occupied...These numbers enable epidemiologists, officials, journalists and the public around the world to track the evolution of Covid-19 in almost real time, making it the first 'data-driven pandemic.' There's a lot at stake in these numbers, and there's a major problem: The data on which we are basing decisions is imperfect and incomplete....U.S. test results offer more of a 'window to the past' rather than an assessment of the present situation. On February 29, the Food and Drug Administration loosened the regulations on the development of Covid-19 tests, effectively allowing labs other than those of the Centers for Disease Control and Preventionto use their own tests...Before this date, all tests had to be conducted by the CDC for a case to be counted as a 'confirmed positive' case of Covid-19....By April 22, the FDA had granted over 40 Exceptional Use Authorizations (EUA) for test kits....In addition, with any test there is a risk of 'false negatives' - someone testing negative for Covid-19 when she is in fact sick. This can happen if medical staff mishandle swabs, which may have to do with the way the test is administered....While it's impossible to readjust the entire country's data structure amid a pandemic, health departments nationwide can publish more complete metrics, following the advice of the COVID Tracking Project and trying to stick to its checklist. Some kind of standard as how to present the data to the public would be helpful."
What American life will look like after the coronavirus crisis ends -The Hill
"A new age is dawning on our nation....This novel disease has had more impact on the average American than the largest stories of the last two decades, including wars in the Middle East, September 11th, and the real estate crash....Consumer spending fell by around 18 percent over the first quarter...The brick and mortar model is not only running independent stores into the risk of default but could also decimate many of the 1,100 malls all across the country...Total online sales have increased 49 percent since the pandemic started. Physical sales outside of food have been heaviest in alcohol sales, increasing by a whopping 75 percent. The housing market has shifted dramatically as well. One third of renters missed their payments last month, and things do not look any better for home buyers. Lenders expect 15 million homeowners will default on their mortgage payments....For many, this crisis has been a rude awakening. An age of true austerity with government control, swinging prices, and the possible rationing of health care all part of our potential future. Hopefully, a combination of effective therapeutics and reopening the economy will offer us a chance to avoid a global depression....But for all of our current struggles, there is an opportunity for each of us to persevere. Only our actions will show how we will ultimately define this period. We must not let the coronavirus define us."
5.4.20 - Gold's 'Growing Potential' to Break $1,800
Gold last traded at $1,710 an ounce. Silver at $14.86 an ounce.
NEWS SUMMARY: Precious metal prices steadied Monday on safe-haven demand despite a firmer dollar. U.S. stocks traded mostly lower as traders weighed the reopening of the economy along with brewing tensions between China and the U.S.
Gold has 'growing potential' to break $1,800 an ounce -UBS/CNBC
"Gold prices could 'break the highs' seen earlier this year...according to UBS Investment Bank's Joni Teves. 'There is growing potential (for gold) to break $1,800 (per ounce) in my view,' Joni Teves, precious metal strategist at UBS Investment Bank, told CNBC's 'Squawk Box Asia' on Monday. In the near term, the firm has a target price for gold at $1,790 per ounce. That comes as 'investor interest continues to grow in this environment of uncertainty and negative real rates,' Teves said....Last week, the World Gold Council released its first-quarter 2020 demand trends report for the precious metal, where it highlighted that the global coronavirus outbreak was 'the single biggest factor influencing gold demand.' 'As the scale of the pandemic - and its potential economic impact - started to emerge, investors sought safe-haven assets,' the report said. 'Gold ETFs saw the highest quarterly inflows for four years amid global uncertainty and financial market volatility.' For her part, UBS' Teves said the move in gold had been drive by a 'pickup in investor interest, particularly from institutional investors.' 'Gold is becoming attractive in this environment where uncertainty is very high, growth is expected to weaken, and at the same time you have negative real rates which make gold attractive to hold as a diversifier in investor portfolios,' Teves said."
Making Sense of the Future After Losing a Job You Love -Harvard Business Review
"Losing a job is deeply shocking. It is a loss of livelihood: the ability to support ourselves and often our families. But the emotional impact goes beyond financial stress....But perhaps most significant is the impact of job loss on our identity or sense of self. For many, work is not only a large part of our waking hours but also who we feel we are. Even in good times, a job loss is often one of life's most stressful events, coming close after bereavement, marital difficulties, and personal injury....But there's a path forward. In research I conducted over 10 years with people forced to leave the work they cared deeply about, I heard about their emotional responses first-hand - and how many of them found a way through....In my research I found that most people who are forced out of a career do manage to create meaningful futures and even feel more fulfilled than they did before. This happens as they come to terms with their disrupted identities and start to see new possibilities....Those who successfully created new futures for themselves tended to move through their grief and growth in three phases: 1. Regulate emotions - It's hard to think straight when your system is flooded with emotion, and there’s a lot to feel emotional about at the moment....2. Engage in sense-making - From a more emotionally regulated place, you can now start to figure out what has happened, why, and what it means for you. Psychologists call this sense-making....3. Experiment and integrate - Sense-making is more than a way of thinking...identities can be greatly enriched, strengthened, or expanded through difficult experiences....If you have been laid off in this time of unprecedented challenge, take heart - this may be an unexpected chance to rethink what you want and who you are, and start building a path towards a job more enlivening than the one you lost."
Coronavirus threat to 401(k)s: Some savers are making these big money moves -CNBC
"It's been a roller coaster for the stock market, and that's certainly had an impact on investors' 401(k) accounts and other employer-sponsored retirement savings plans. Several major 401(k) providers, including Fidelity, Vanguard and T. Rowe Price, said the overwhelming majority of their 401(k) investors stayed the course and did not trade or change their asset allocation last month, as the S&P 500 lost 30% of its value from its record highs. Yet new data from Alight Solutions 401(k) Index, which tracks investment activity of about 2 million 401(k) participants, tell another story...The total amount of money transfers, as a percentage of an account's starting balance, was the highest it's been since October 2008, in the middle of the Great Recession....Unfortunately, many 401(k) investors don't have a financial plan and may not have reviewed their retirement investments in years, prior to the March market slide....Under the $2 trillion coronavirus relief package, it is easier now for savers to take money out of their retirement plans. Under the CARES Act, beginning March 27, 2020, and up to 180 days after, you can borrow up to $100,000 from your 401(k)....Some advisors worry that this could cause more retirement savers to tap their 401(k), putting their long-term financial security in greater jeopardy."
FDA authorizes remdesivir for emergency use as coronavirus treatment -CBS News
"The Food and Drug Administration has authorized the antiviral drug remdesivir for emergency use in treating coronavirus cases, FDA Commissioner Stephen Hahn announced in an impromptu Oval Office meeting on Friday afternoon. Daniel O'Day, the CEO of Gilead Sciences, which produces the drug, also attended the meeting with administration officials. O'Day said that Gilead would continue to work with the administration and said the company is working to increase its supply of IV remdesivir, which does not cure the disease but may help shorten its duration. Hahn thanked O'Day for the company's collaboration with the administration and praised FDA officials for work in responding to the pandemic. 'This is an important clinical advance,' Hahn said about remdesivir, calling it 'the first authorized therapy for COVID-19.' Dr. Deborah Birx, the leader of the White House coronavirus task force, also praised O'Day and the drug, which shortened the recovery time for some coronavirus patients in a recently completed clinical trial. 'This is our first really positive step forward,' Birx said....Dr. Anthony Fauci, the nation's top infectious disease specialist, expressed his optimism Wednesday about the ability of remdesivir to shorten the time it takes seriously ill patients to recover from a COVID-19 infection....However, a separate study on a smaller group of patients in China, published in the peer-reviewed journal The Lancet the same day, did not find statistically significant benefits from the drug for those with 'severe' COVID-19."
5.1.20 - Gold Prices Are Going to "Pop" to $2,700
Gold last traded at $1,705 an ounce. Silver at $14.99 an ounce.
NEWS SUMMARY: Precious metal prices rose on safe-haven buying and a weaker dollar. U.S. stocks slumped as shares of Amazon led the major indexes lower on the month's first day of trading following mixed first-quarter results.
Gold prices going to "pop" to $2,700, easily -Holmes/Kitco
"Despite a weakened economy, stocks continue to rise on the back of monetary stimulus, which is bound to push gold prices even higher, this, according to Frank Holmes, CEO of U.S. Global Investors. Stocks are going up 'because of the trillions and trillions of dollars of money printing from the helicopters of central bankers. The G20 central bankers, the G20 finance ministers, that's a cartel, like OPEC,' Holmes told Kitco News. Fundamentally, gold's supply deficit should also provide tailwinds, Holmes said. 'Last year, as I've mentioned, everyone was surprised that palladium could go from $1,000 to $2,700, and I said short-term, why can't gold do that?' he said. 'We're going to see gold pop. $2,700 is easy for me to see that.' Holmes added that the gold miners should also perform exceptionally well during periods of upward bullion price movements."
A Broken System: Trader Warns "The Fed Has Poisoned Everything" -Zero Hedge
"The Fed poisons everything, and I mean everything. From markets, the economy...But as much as the Fed poisons everything, this crisis here again reveals a larger issue: The system is completely broken, it can't sustain itself without the Fed's ever more monumental interventions....So how does the Fed poison everything? Let's start with the Fed actual process of working towards its stated mission: Full employment and price stability. How does it do that? Well, for the last 20 years mainly by extremely low interest rates and balance sheet expansion sprinkled with an enormous amount of jawboning. The principle effect: Asset price inflation. It's not a side effect, it's the true mission. The Fed has been managing the economy via asset prices even though Jay Powell again insisted on saying the Fed is not targeting asset prices. This is a lie....It was not until the Fed flooded markets with cheap money creating the housing bubble that the equation changed dramatically...There is no alternative. Forcing money into equities to manage the economy with a rising stock market....And the entire market knows this. Wall Street knows this. Why? Because the market is a follow the Fed machine long trained to jump back into equities at any sign of Fed action jawboning and promises. It's no accident that 'don’t fight the Fed' is a popular mantra....Recklessly widening the wealth inequality equation in the process. What happens when you have a slow growth recovery for 10 years and all the wealth benefits going disproportionally to the top 1% who own most of the assets that are targeted, while real wage growth stagnates? For one you have a sizable portion of society that doesn't have a pot to piss in, behind in bills, struggling to pay rent, little to no savings or retirement, taking on multiple low paying jobs with no benefits while real estate prices keep rising as the wealthy keep squeezing people out of neighborhoods....The end results: With inequality is skyrocketing even further as millions are unemployed and many more are losing incomes while the shareholders and executives and those with larger retirement funds can take solace that the damage to them is minimized....The system is not broken, it's designed to function exactly as it is, because it benefits precisely the very same people that control it."
Rent is Due Today, but Many Tenants Can't - or Won't - Pay -Wall Street Journal
"May is shaping up as a clash between renters and landlords, as soaring unemployment could leave millions of tenants unable to pay, and some organizers of rent strikes urge even those with means to hold back....Many more are worried about keeping their jobs, and housing activists in at least 15 cities, including New York and Chicago, are organizing rent strikes....'We thought [unpaid rent] stabilized, but then who knows if everyone's going to go on a rent strike,' Joseph DePaolo, the head of Signature Bank, a prominent lender to multifamily landlords in New York, said....The best estimates of how many people fail to pay on time this month won't be available for at least a week, but early polls suggest that many Americans are unsure they can pay in full....National real estate trade groups have recommended landlords create payment plans for struggling tenants. Renter households had a median income of $40,500 in 2018, according to the Census Bureau, compared with $78,000 for owner households....The federal stimulus law halted evictions for 120 days for renters who live in properties financed by federally backed mortgages. At least 28% of rental properties in the U.S. are estimated to fall under these rules, according to the Urban Institute....Some Democrats in the House of Representatives, as well as in state and local legislatures, have called for 'canceling rent' in solidarity with the rent strike movement."
Americans are hoarding cash: The savings rate hit its highest level since 1981 -CNN
"Americans are so nervous about the state of the economy that they are stashing cash in the bank at a rate not seen since the first year of Ronald Reagan's presidency. The United States government's Bureau of Economic Analysis reported Thursday morning that the savings rate surged to 13.1% in March - up from 8% in February. That's the highest savings rate since November 1981....Consumers are putting more money away at a time when bank savings, money market accounts and Treasury bonds are yielding next to nothing after the Federal Reserve slashed rates to zero last month and launched numerous lending programs in the wake of the Covid-19 pandemic. At a press conference on Wednesday, Fed chair Jerome Powell was asked about what savers should do since rates are at zero. He conceded that for people 'really just relying on their bank savings account earnings, you're not going to benefit from low interest rates.'....Still, consumers may be saving more because they are spending less - a lot less, in fact. The BEA also said Thursday that consumption expenditures fell 7.5% last month, led by a nearly $935 billion drop in spending on goods and services....One economist theorized that perhaps Americans were preparing for an inevitable downturn...'Speculation is people were bracing for the next recession,' said Robert Frick, corporate economist with Navy Federal Credit Union."
4.30.20 - Gold Soars in April on Central Bank Stimulus
Gold last traded at $1,694 an ounce. Silver at $14.97 an ounce.
NEWS SUMMARY: Precious metal prices rose in April as investors were drawn to the metal’s proven store of value qualities. U.S. stocks fell on downbeat economic data as the CV-19 pandemic pushed U.S. jobless claims above 30 million in the last six weeks.
Gold Soars in April as Top Central Banks Fight Pandemic's Damage -Bloomberg
"Gold is heading for the biggest monthly gain since 2016 as top economies ramp up stimulus to repair the damage from the coronavirus pandemic, boosting the metal’s allure as a store of value. Bullion traded near the highest since 2012 after the U.S. Federal Reserve voiced concern Wednesday the crisis could leave permanent scars on the U.S. economy, while leaving interest rates near zero....Gold has rebounded after a sell-off last month, when investors rushed to raise cash. There was also some delayed quarterly portfolio rebalancing pushed back due to those late-March falls, Rhona O'Connell, head of market analysis for EMEA and Asia at INTL FCStone, said by email. 'Additional liquidity in the system benefited gold,' she said. 'The risks in the system do point to further gains.'....Overall sentiment for gold is still high, as investors seek havens amid the economic downturn, and monetary and fiscal stimulus, according to State Street Global Advisors. Gold will trade between $1,700 and $1,800 an ounce for the next few weeks, with a skew to the higher end of that range, Robin Tsui, Asia-Pacific gold strategist, said in an interview. 'The low interest rate factor is going to drive gold prices forward.'"
We Are Fighting a Public Health Crisis, Not a War -Bonner/Bonner And Partners
"Steve Mnuchin: 'We need to spend what it takes to win the war.' It is a scam on several levels. First, the 'war' is fake. This is a public health crisis, not a war. Calling it a 'war' is just a way to get people to salute the leaders....Second, the feds are not fighting the virus. Doctors, nurses, and hospitals are fighting the virus. The feds turned a natural disaster into a man-made economic disaster. Third, they are now desperately trying to save a failed financial system… and taking advantage of the crisis to bail out cronies, reward campaign donors, expand the Deep State, and enhance their own power. Fourth, the feds have no money saved to give in 'aid' or 'stimulus.' Every penny must come from the people they pretend to be aiding. Fifth, the money they give out is fake… In its most tangible form, it is nothing more than paper with green ink on it. It represents no goods, no services, no earnings, no wealth, and no savings. Sixth, like a phony claim ticket at a hat-check booth, this kind of fake money merely entitles the people who get it - the cronies, the chislers, the insiders - to take someone else's coat. Seventh, providing an economy with fake money does not cause it to produce more goods and services. Instead, it sours the whole system… misleads investors and consumers… and reduces real output. Eighth, the most common and destructive effect of this scam is inflation. First, asset prices are inflated. Later, consumer prices rise, too, eventually washing out every penny of stimulus spending - and more....Today, stocks are moving up as investors anticipate trillions in new money… and an easing of the lockdown conditions...Stocks could soar, as they did in Zimbabwe and Venezuela. But in real money terms (that is, in terms of gold) stock prices will almost surely go down - along with the dollar… the economy… and the American Empire."
Wall Street veteran's explanation of weird investor behavior: gambling -Yahoo Finance
"DataTrek's Jessica Rabe wrote that some mom and pop investors might be day-trading the market more because casinos professional sports have shut down and casinos have closed. Across certain segments of the 'regular people' investment landscape - Vanguard and Fidelity, for example - there hasn't been much in the way of panic selling as many customers seem to have internalized the 'stay the course' messaging that followed the last financial crisis...In fact, many of these retail investors have bought equities as markets plunged...March daily trade volumes were around three times that of Q4's daily volume - which has continued into April....Rabe called the 'tremendous rush of retail investors into US equities over the last 8 weeks' one of the 'most surprising financial market features of the COVID crisis.'....This list of most traded stocks is interesting, Rabe points out, because with the exception of Disney, they are all cheap and very volatile stocks that can move up and down 10% in just a few days. Why are so many people drawn to them? The explanation Rabe lands on sounds wild, but compelling. 'This shoves us to a strange, but we think useful, conclusion,' Rabe writes. 'The rush of retail investors into U.S. equities is at least partly a function of a world with no casinos, no sports betting to speak of (horses and ping-pong aside), and little to do outside the home.'"
For people with dementia, the coronavirus pandemic is a nightmare -The Economist
"People with every stage of dementia are at particular danger from the virus not just because of the difficulty they may have in understanding the threat or in remembering safety precautions. They are also likely to be subject to other risk factors. The most obvious is that dementia is predominantly a syndrome of the elderly, the group for whom covid-19 is most likely to be fatal...By some estimates, 2% of 65- to 69-year-olds have dementia, and its prevalence doubles every five years to the age of 90. In another widely quoted estimate, between a third and a half of 85-year-olds have dementia....Looking after people with dementia is a hands-on, labor-intensive task. For those at home, that can become almost impossible if social-distancing guidelines are adhered to. And much of the usual support system - regular visitors and day-care centers, for example - will be unavailable....Professor Livingston of the London School of Economics says that the 'memory clinic' where she works decided to shut, as the doctors concluded 'it was more risky to see people than for them not to have a diagnosis for a short period of time.' But the longer the delay goes on, the greater dangers people living with undiagnosed dementia pose to themselves, and perhaps others, if, say, through forgetfulness they start a fire, or continue to drive when they can no longer do so safely....As life expectancies lengthen, especially in the developing world, the numbers of people with the condition will shoot up, to around 80m by 2030 and 150m by 2050. As population growth slows, there will simply not be enough people to care for them. No country has a good plan for how to deal with this problem, or how to finance the care of such large numbers of people. Optimists point to the current pandemic to argue that it shows how much can be done when the scale of an emergency is recognized."
4.29.20 - War on Cash Kicking Into Overdrive
Gold last traded at $1,716 an ounce. Silver at $15.44 an ounce.
NEWS SUMMARY: Precious metal prices eased Wednesday on profit-taking despite a sharp drop in U.S. economic activity. U.S. stocks rose on positive data from a potential coronavirus treatment from Gilead Sciences.
'Government stupidity' may bring new gold price highs -Forbes/Kitco
"Regardless of how bad the economic fallout from COVID-19 and subsequent government response will be, one thing is clear: gold will retain its status as a hedge asset and is a must-own in every investor's portfolio, according to Steve Forbes, chairman and editor-in-chief of Forbes Media. In a podcast published on Forbes magazine last Friday, the media mogul outlined several economic scenarios, all pointing to tailwinds for the yellow metal. 'The trillions of dollars being spent to save our virus-battered economy are stoking fears of inflation,' he said. 'Gold has always been a hedge against government's economic blunders.' Forbes added that government policies enacted now could lead to disaster that has the potential to send gold prices soaring, like in the 1970s. He joins a host of analysts who have said that fundamentals are about to push gold prices much higher than current levels. Bank of America was among the Wall Street analysts who have turned bullish on gold, recently calling for prices to target $3,000 in 18 months....Comparing gold to stocks, Forbes outlined the metals' superior performance during market downturns. 'If you'd put say $10,000 in the stock market a year ago, you have about $9,000 today. If you put that $10,000 in gold you have $13,500 today. That's over $4,500. Since stocks reached their highs in February, gold has outperformed them by a good margin,' he said."
War on Cash Kicking Into Overdrive -Rickards/Daily Reckoning
"The global elites and deep state actors always have a laundry list of programs and regulations they can't wait to put into practice. They know that most of these are deeply unpopular and they could never get away with putting them into practice during ordinary times. Yet when a crisis hits, citizens are desperate for fast action and quick solutions. The elites bring forward their rescue packages but then use these as Trojan horses to sneak their wish list inside. The USA Patriot Act that passed after 9/11 is a good example. Some counterterrorist measures were needed, of course. But the Treasury had a long-standing wish list involving reporting cash transactions and limiting citizens' ability to get cash. They plugged that wish list into the Patriot Act and we've been living with the results ever since, even though 9/11 is long in the past. Obviously, the effort to eliminate cash is hardly new. It has been going on for many years and in many forms. The U.S. discontinued the use of large-denomination bills in the late 1960s. Until 1969, $500, $1,000, $5,000 and even $10,000 bills were issued, even though they were printed decades earlier. Today the largest bill is a $100 bill, but it has lost 80% of its purchasing power since 1968, so it's really just a $20 bill from those days....This crisis is even larger and scarier than the 2008 crisis, which gives elites even more opportunity to ram their agendas through without serious opposition. They don't intend to let it go to waste. Sure enough, government agents and tech vendors are now claiming that cash is 'dangerous' because it could contain traces of the coronavirus. While that's not impossible, it's highly unlikely and no more likely than getting the virus from 100 other sources including package deliveries and shopping carts. Should we ban cardboard boxes and shopping carts too?....The time to protect yourself is now. The best way is to keep a portion of your wealth outside of the banking system. I strongly recommend that you own physical gold (and silver). I recommend you allocate 10% of your investable assets to gold. If you really wanted to be aggressive, maybe 20%....I see gold going to at least $10,000 an ounce ultimately...When the next panic hits, and it will hit, there won't be any gold available at any price."
What It Might Look Like to Safely Reopen Schools -KQED/Mindshift
"Three-quarters of U.S. states have now officially closed their schools for the rest of the academic year. While remote learning continues, summer is a question mark, and attention is already starting to turn to next fall....Here are nine key ideas - drawn from interviews with public health experts, education officials and educators around the country - for what reopening might look like. 1. Stepped-up health and hygiene measures - So the first order of business, says Michael Mulgrew, the head of the New York City teachers union, is 'How do you make sure there's a plan in place to make sure the people walking in are not spreading anything?'....2. Class sizes of 12 or fewer - In an attempt to balance safety with the impact on families and the economy, Maria Litvinova, a researcher at the Institute for Scientific Interchange in Turin, Italy, recommends reducing social contact by putting children in the smallest groups possible....3. Staggered schedules - Reducing class size this drastically would probably mean staggering schedules....4. Younger kids first? Denmark reopened its day cares and primary schools first. Norway started with kindergartens, and Israel with special education kindergartens....5. New calendars - To make up for the learning lost while schools are closed, there have been suggestions of starting school sooner, or continuing through next summer, or both....6. Different attendance policies - Schools can open up, but some parents might still choose to keep their children at home....7. No assemblies, sports games or parent-teacher conferences - Students can't mix in large groups, and parents probably won't be allowed in school buildings either....8. Remote learning continues - Every expert NPR spoke with predicted that the need for remote learning would continue because of staggered schedules, schools prepared to close again for future waves of infection....9. Social, emotional and practical help for kids - Developmental experts say disruption from the pandemic constitutes an 'adverse childhood experience' for every American child."
The Bearer of Good Coronavirus News -Wall Street Journal
"Defenders of coronavirus lockdown mandates keep talking about science...But scientists are almost never unanimous, and many appeals to 'science' are transparently political or ideological. Consider the story of John Ioannidis, a professor at Stanford's School of Medicine. His expertise is wide-ranging - he juggles appointments in statistics, biomedical data, prevention research and health research and policy. Google Scholar ranks him among the world's 100 most-cited scientists. He has published more than 1,000 papers, many of them meta-analyses - reviews of other studies. Yet he's now found himself pilloried because he dissents from the theories behind the lockdowns - because he's looked at the data and found good news. In a March article for Stat News, Dr. Ioannidis argued that Covid-19 is far less deadly than modelers were assuming. He considered the experience of the Diamond Princess cruise ship, which was quarantined Feb. 4 in Japan. Nine of 700 infected passengers and crew died. Based on the demographics of the ship's population, Dr. Ioannidis estimated that the U.S. fatality rate could be as low as 0.025% to 0.625% and put the upper bound at 0.05% to 1% - comparable to that of seasonal flu. 'If that is the true rate,' he wrote, 'locking down the world with potentially tremendous social and financial consequences may be totally irrational.'....Scientific studies are often infected by biases. 'Several years ago, along with one of my colleagues, we had mapped 235 biases across science. And maybe the biggest cluster is biases that are trying to generate significant, spectacular, fascinating, extraordinary results,' he says. 'Early results tend to be inflated. Claims for significance tend to be exaggerated.'....Dr. Ioannidis and colleagues at Stanford last week published a study on the prevalence of coronavirus antibodies in Santa Clara County. Based on blood tests of 3,300 volunteers in the county - which includes San Jose, California's third-largest city - during the first week of April, they estimated that between 2.49% and 4.16% of the county population had been infected. That's 50 to 85 times the number of confirmed cases and implies a fatality rate between 0.12% and 0.2%, consistent with that of the Diamond Princess....In part he blames the media: 'We have some evidence that bad news, negative news [stories], are more attractive than positive news - they lead to more clicks, they lead to people being more engaged. And of course we know that fake news travels faster than true news. So in the current environment, unfortunately, we have generated a very heavily panic-driven, horror-driven, death-reality-show type of situation.'"
4.28.20 - Free-Market Agenda for Post CV-19 Rebuilding
Gold last traded at $1,721 an ounce. Silver at $15.28 an ounce.
NEWS SUMMARY: Precious metal prices eased again Tuesday as signs of lockdown easing lifted risk appetite. U.S. stocks traded mixed as as shares of the so-called FANG tech companies declined.
For Retirees Seeking an Inflation Hedge, Here's How to Add Gold -Barrons
"Gold has again excelled in its role as a safe haven and portfolio diversifier, with the precious metal near 7½-year highs after rallying around 10% since early March while stocks tumbled during the coronavirus-driven market tumult. Looking ahead, gold figures to play a starring role as a store of value as investor expectations on future inflation climb amid global stimulus efforts that have put a flood of cash into the financial system. For retirees on a fixed income, inflation can be a killer especially as interest rates remain low. But how much should retirees allocate to gold and how to include in a portfolio?....Kristina Hooper, chief global market strategist at Invesco, says gold is appropriate in anyone's portfolio as part of the alternatives allocation since the metal can offer portfolio diversification and be an inflation hedge over the long run...Depending on the person’s risk tolerance, gold can take up a 5% or less portfolio allocation, she says....Frank Holmes, CEO of U.S. Global Investors, which issues precious metals mutual funds and exchange-traded funds, says gold becomes a true store of value when the inflation rate starts to outpace interest rates. In gold markets, investors look at 'real' interest rates, subtracting the benchmark rate from the inflation rate. If that rate turns negative, as it has recently, gold shines. Negative inflation-adjusted interest rates were behind gold's last run between 2008 and 2011, when gold hit a nominal all-time high of just over $1,900 an ounce. Gold started to retreat when those 'real' rates turned positive, he says. With benchmark rates near zero, this could work in gold's favor again. He recommends gold holdings up to 10%."
Tech giants are profiting - and getting more powerful - even as the global economy tanks -Washington Post
"Tech titans spent much of the last year playing defense, fending off dozens of federal and state antitrust investigations and a public wary of their power. But the global coronavirus pandemic is prompting a dramatic reversal of fortune for the tech giants. Amazon and Facebook are capitalizing on the fact that they are viewed as essential services for a public in lockdown, while Google and Apple are building tools that will enable state health departments to provide a critical public service, tracing the course of potential new covid-19 infections....While the global economy faces potential unemployment and contraction not seen since the Great Depression, the tech giants - and a handful of medium-size tech firms - are already benefiting from new consumer habits initiated during the lockdowns that analysts believe will turn into longer-term shifts in how people shop, work and entertain themselves. The broader stock markets tanked in recent weeks, but share prices of Amazon and Microsoft hit at or near records. Facebook is moving to acquire high-skilled talent, announcing the hiring of 10,000 new workers this year....'There are really two Americas right now,' said Scott Galloway, a marketing professor at the New York University Stern School of Business and author of 'The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google.' 'There is Big Tech and there is everyone else. They can do what very few companies can do, which is play offense in the middle of a pandemic.'....At the same time, the public is becoming more reliant on tech giants' services, while governments outsource critical work to them...As the economic contraction continues and start-ups die off, the largest firms may also be some of the only companies in the position to do any hiring. In a recent interview, Sheryl Sandberg, chief operating officer of Facebook, made a point of highlighting that the company would create 10,000 new positions this year in engineering and product roles."
Debt, wealth destruction and lower pay will be coronavirus' legacy -Marketwatch
"Post-pandemic recovery will experience effects that persist after the initial cause - the coronavirus - cease to have an impact. There are several operative elements to consider: 1. The crisis will continue to destroy wealth: During the Great Recession, the U.S. lost around $10 trillion from drawdowns in savings, falling values of houses and investments. After the COVID-19 crisis, depleted savings will affect consumption levels....2. The crisis will leave a legacy of debt: Household, business and government, many already highly indebted, will experience sharp rises in borrowing to cover cash-flow shortfalls...Slower rebounds in real estate and financial asset prices will exacerbate the damage. A decade after the 2008 crisis, millions of homeowners still had mortgages greater than the value of their homes....3. Business will be slow to recover: Most smaller businesses lack reserves to meet expenses for more than a month or, at most, a quarter. Invested capital will be lost...Reversing this loss takes time....4. There will be persistent negative effects in the labor market: Lacking any realistic prospects of getting work, many will leave the workforce....5. Increased state involvement and higher government debt will be difficult to reverse: Benefits provided in the COVID-19 crisis may be difficult wind back....6. Expect behavioral changes in people: Scarring from the crisis will affect family formation and fertility, which will alter demographics and accelerate the impact on societies with aging populations."
A free-market agenda for rebuilding from the coronavirus -Action Institute
"On June 18, 1940, British Prime Minister Winston Churchill steeled his people for the Battle of Britain with a stirring speech in the House of Commons that concluded: 'Let us therefore brace ourselves to our duties, and so bear ourselves, that if the British Empire and its Commonwealth last for a thousand years, men will still say, ‘This was their finest hour.’' The present coronavirus crisis calls for Churchillian statesmanship, yet few, if any, democratically elected leaders have proven equal to the task so far. This is decidedly not our finest hour. The leaders of the world's democracies have virtually shut down democratic capitalism in an attempt to save lives...Unemployment and government debt are spiraling to levels not seen since the Great Depression and World War II....The point is that free markets and working economies are absolutely essential in order to effectively mobilize the resources required to take on COVID-19 and other public health problems. Without essential liberty, there is no safety, to paraphrase Benjamin Franklin. What would courageous and prudent statesmanship look like in the present crisis?....Let me suggest a few key elements: 1) Make a strong moral case for medical liberty, healthcare innovation, and healthcare investment as core pillars of democratic capitalism and a culture that values every human life. 2) Reopen the economies and borders of the world's democracies immediately while closely monitoring COVID-19 hot spots and applying locally driven restrictions as necessary. 3) Prioritize supply-side tax cuts and deregulation over bailouts and unemployment benefits in order to quickly get the economy back on its feet. 4) Launch an ambitious free-market healthcare reform agenda, removing bureaucratic obstacles to private sector innovation and investment in healthcare. 5) Create a transatlantic free trade area for healthcare, giving American healthcare innovators greater access to European and Canadian health systems and vice versa."
4.27.20 - Reopening Has Begun. What Happens Next?
Gold last traded at $1,726 an ounce. Silver at $15.31 an ounce.
NEWS SUMMARY: Precious metal prices eased back Monday on short-term profit-taking as lockdown easing boosted risk appetite. U.S. stocks rose as investors mulled over the possibility of re-opening the economy after the coronavirus outbreak.
Pandemic Triggers a Wave of Distress, Bankruptcy in Corporate America -Wall Street Journal
"Stay-at-home orders and the shutdown of nonessential business have driven broad swaths of the economy into panic mode. In industries that were already in a precarious position before the crisis, including retail and energy, the coronavirus pandemic has tipped many companies over the edge. A host of oil companies have sought chapter 11 protection, while J.C. Penney Co. and Neiman Marcus Group Inc. are expected to file for bankruptcy soon. Companies in areas that were previously stable, such as the automotive, travel and leisure industries - and even health care - may soon face similar pressures. U.S. corporate debt downgraded to selective default, meaning a borrower has failed to meet one or more of its obligations, totaled $64.1 billion for the 12 months ended April 17, according to S&P Global Ratings....In the coming months, that figure could top the roughly $340 billion reached at the height of the financial crisis, according to the worst-case scenario estimates from S&P. Even in a less grim scenario, the figure could approach levels reached after the dot-com bust in the early 2000s. Companies of all stripes are scrambling to avoid a painful reorganization of their capital structures and operations, default or bankruptcy....Should the recession prove deeper than envisioned, there could be a second - potentially bigger - wave of corporate distress later this year as companies labor under the weight of additional debt taken on during the shutdown, advisers warn."
Since Inception, The Euro Has Devalued 85% Against Gold -Zero Hedge
"Technically, the euro was launched on January 1, 1999, although euro notes and coins started circulating in January of 2002. The first gold price recorded in 1999 was €7.88 euros per gram. By now, the gold price has crossed €51 euros per gram. A new all-time high. Over the course of 20 years, the price of gold in euros has increased by 555%. From a historic perspective the euro is a young currency, but already lost 85% of its value against gold. This reveals the instability of fiat money....In 1999 it took 0.13 gram to buy one euro; today only 0.02 gram. The result is that the euro lost 85% of its value versus gold. In the chart you can see the euro's descent versus gold since 1999....Gold's purchasing power, on average, has increased by a staggering 350% over 20 years. The gold price can be volatile at times, but over longer periods of time it preserves its purchasing power, with the benefit that it doesn't have any counterparty risk, so it withstands every crisis."
Reopening Has Begun. No One Is Sure What Happens Next. -New York Times
"The economy shut down almost overnight. It won't start back up that way. Politicians and public health experts have sparred for weeks over when, and under what circumstances, to allow businesses to reopen and Americans to emerge from their homes. But another question could prove just as thorny - how? Because the restart will be gradual, with certain places and industries opening earlier than others, it will by definition be complicated. Georgia and other states are beginning the reopening process. But even under the most optimistic estimates, it will be months, and possibly years, before Americans again crowd into bars and squeeze onto subway cars the way they did before the pandemic struck. 'It's going to take much longer to thaw the economy than it took to freeze it,' said Diane Swonk, chief economist for the accounting firm Grant Thornton. And it isn't clear what, exactly, it means to gradually restart a system with as many interlocking pieces as the U.S. economy. How can one factory reopen when its suppliers remain shuttered? How can parents return to work when schools are still closed? How can older people return when there is still no effective treatment or vaccine?....'The biggest risk is that you open too fast, too broadly, and you have another round of infections, a second wave,' said Mark Zandi, chief economist for Moody's Analytics. 'That's the fodder for an economic depression. That would just completely undermine confidence.'....Economists say the government's role is only beginning. Businesses will need help weathering a period of reduced sales. State and local governments will need help, too, or they will have to cut programs to offset a sharp drop in tax revenue. Individuals will need unemployment benefits, food assistance and other aid to make ends meet in a recession that will almost certainly outlast the pandemic."
It's Time to Flatten the Loneliness Curve for Older Americans -Freedman/Gomperts/Next Avenue
"Just as the nation's population of people over 65 is about to skyrocket, we face the intersection of two deadly epidemics: COVID-19 and loneliness. One is deadly now, the other a slow-motion threat of equal consequence. Even before the current crisis, we were in a social recession, as evidenced by dramatic increases in loneliness and isolation. Now we're in danger of entering a social depression that might last for years. And here, too, older people - the canaries in the loneliness coal mine - are most at risk. Research from the University of California, San Francisco shows that 43% of adults over 65 feel lonely, which puts them at higher risk for poor health. And AARP researchers traced social isolation to nearly $7 billion in additional Medicare spending every year. To get us on the road toward being a stronger, more caring and connected society, we need a social stimulus plan as bold and encompassing as the fiscal one. It should start with alleviating, even preventing, loneliness. And here's some good news: We don't have to start from scratch....The United States could establish our own equivalent, a cabinet-level position tasked with creating a comprehensive plan to connect people in ways that prevent isolation and mitigate it when it does occur....Next, we'll need an infusion of resources equal to the need and the task. Here we can take inspiration from Singapore, a tiny nation with a grand plan to transform aging, provide purpose for its rapidly growing aging population and create intergenerational connection....Education offers many opportunities for community connection...Volunteering is such an important health intervention for older adults that Dr. Linda Fried, dean of the Mailman School of Public Health at Columbia University, has suggested that Medicare 'prescribe and support' programs like AARP Experience Corps, a tutoring and mentoring effort matching older adults and K-3 students in under-resourced public schools. That kind of public health investment could save money in the long run, as older adults stay healthier longer and children get a better start with the confidence that comes from having more caring adults in their corner...The tragedy of the COVID-19 pandemic and the necessity of social distancing underscore the growing social isolation crisis that is sapping far too many lives of meaning, joy and contribution. As the population of older people grows and the risk of disconnection grows along with it, it's time to think about how we can flatten the loneliness curve and put in place policies and measures that will carry us through this crisis into a new era of interdependence."
4.24.20 - Paying Americans Not to Work -WSJ
Gold last traded at $1,739 an ounce. Silver at $15.30 an ounce.
NEWS SUMMARY: Precious metal prices rose Friday heading toward a strong week driven by Fed stimulus measures. U.S. stocks mostly flat as investors faced another volatile week featuring unprecedented moves in the oil market.
Gold heads for weekly gain as growth fears boosts demand -CNBC
"Gold prices edged higher Friday and was on track for a strong weekly rise, driven by central bank stimulus measures and investor appetite for a safe haven as fears mount over the economic damage caused by the novel coronavirus....'Gold is holding up well and it's not surprising given the continuing volatility in other markets and people looking for safe havens,' Commerzbank analyst Eugen Weinberg said. 'In euro terms, gold has risen to an all-time high, which is definitely yet another proof of the continuing safe-haven demand and decreasing trust in central bank money.'....More than 2.7 million people have been reported to be infected by the virus globally. Central banks have adopted massive monetary measures to limit the economic damage as most countries extend lockdowns to curtail its spread....Gold tends to benefit from widespread stimulus measures from central banks because it is widely viewed as a hedge against inflation and currency debasement. 'In this new world in which both the European Central Bank and the U.S. Federal Reserve continue to unleash new stimulus packages, dramatically increasing the liquidity of cash, combined with a lot of uncertainty, gold will remain in high demand and play a key role in any investor’s portfolio,' ActivTrades chief analyst Carlo Alberto De Casa said in a note."
U.S. Is Following in Argentina's Economic Footsteps -Bonner/Bonner And Partners
"There's an advantage to spending time in a place like Argentina....Economists like to study Argentina. It's the only country in the world to go from one of the world's richest… to sh*thole status… thanks entirely to government policy....The Argentines can't borrow because no one will lend them money. The Americans can't borrow, either, because nobody's got that kind of money. And if they had it, they wouldn't be fool enough to lend to someone on such a reckless spending binge. The only possible source for so much financing is the Federal Reserve. And the Fed's only source is the 'printing press.' So, in other words, the U.S. is following in Argentina's tracks… but on a much bigger scale....Argentina's inflation rate is already over 50%. But that's nothing compared to its inflation of the 1980s...when prices rose an average of about 300% per year. That kind of inflation does to an economy approximately what the coronavirus does. Things shut down. Businesses can't make plans. They can't invest for the future. They let workers go. People stay home. Their money loses value so fast, they try to get rid of it as soon as possible. This feeds even further price increases… and less production....When it comes to making a mess of an economy, the Argentines are pros....'Here in Argentina, we know we're crazy,' says our neighbor, Ramon. 'Now, we're glad to have company.'"
Paying Americans Not to Work -Editors/Wall Street Journal
"Much of the harm from the coronavirus is unavoidable, but it would be nice if politicians didn't compound the damage by ignoring the laws of economics. The worst blunder so far on that score is the $600 increase in federal jobless benefits that is already undermining the economic recovery. On Wednesday we ran an op-ed from Kurt Huffman, whose Portland, Ore., company helps chefs run and staff their restaurants. Because of the coronavirus, he had to lay off 700 people. But some restaurants have adapted with takeout and delivery, so he needs to hire some back. Some extra unemployment insurance is necessary, but the rich extra compensation from the $2.2 trillion Cares Act is encouraging those employees to stay home....We're hearing similar stories from around the country as small business owners look to reopen on a tentative or partial basis. Employees say they'll take the unemployment check for as long as they can make more money by not working....Democrats will try to extend the $600 for another few months, and then a few more after that, as they describe anyone who disagrees as heartless...The Democratic 2020 campaign strategy is to blame Republicans for the health and economic damage from the virus. Republicans need to be able to point to an economy that is growing again by the autumn, and that means not giving Americans an incentive not to work."
Will oil's price slump be worse for the economy than the effects of the coronavirus? -NBC News
"The prospect of cheaper gas at a time when most Americans are holed up at home is not much of a silver lining to the coronavirus pandemic. Energy analysts say there is little upside to the unprecedented plunge in oil prices that sent crude oil futures spiraling into negative territory on Monday, spooking Wall Street. Patrick DeHaan, head of petroleum analysis at GasBuddy, predicted that the national average gas price could drop below $1.50 a gallon in the coming weeks, noting that a few states have already hit this benchmark. But he said drivers shouldn't expect to see gas fall as sharply as crude prices. 'Unfortunately for motorists, it may not fully make it to the pump, given that stations are trying to keep the doors open - even with volume down 50 to 70 percent,' he said....Oil prices tumbling into negative territory is a symptom of a very real problem: With demand for everything from gasoline to jet fuel plummeting, producers are literally running out of places to store oil once it leaves the ground....If prices don't regain stability, analysts' biggest fear is that the U.S. energy sector won't be able to bounce back. 'The longer oil remains this low, the more risk there is that when demand rebounds, oil production won't,' DeHaan said....'It's not just drilling wells and producers, it's everything that goes downstream… pipelines, refineries, petrochemicals, oil field services,' said Peter McNally, global energy sector lead at investment and research firm Third Bridge. 'There are much broader economic implications this time. It's not just oil seeing demand drop - it's pretty much every industry,' McNally said."
4.23.20 - Is the Coronavirus Killing Off Cash?
Gold last traded at $1,747 an ounce. Silver at $15.34 an ounce.
NEWS SUMMARY: Precious metal prices continued climbing Thursday on safe haven demand and a weaker dollar. U.S. stocks rose with oil prices as investors digested the latest downbeat U.S. unemployment and earnings data.
Gold surges nearly 2%, fueled by hopes of stimulus boost -CNBC
"Gold prices jumped as much as 1.9% on Wednesday on expectations for more fiscal and monetary stimulus measures amid massive economic damage due to stay-at-home and business shutdown orders around the world to limit the spread of the novel coronavirus....'This is the perfect storm for gold... Perpetual buyer is buying gold because of all the global stimulus going on,' said Michael Matousek, head trader at U.S. Global Investors. 'Gold is in a bull market. You'll be hard pressed to find something else that has this type of price action and this trend going on right now so you naturally have people gravitating towards it.' Gold tends to benefit from widespread stimulus measures from central banks, as it is often seen as a hedge against inflation and currency debasement....'Technically, the gold bulls have the firm overall near-term technical advantage amid price uptrends in place on the daily, weekly and monthly charts,' Kitco Metals senior analyst Jim Wyckoff said in a note. 'Bulls' next upside price objective is to produce a close in June futures above solid resistance at $1,800.'"
Is the Coronavirus Killing Off Cash? -Politico
"Stores are shuttering all over the United States, and many of those still open are balking at cash. Shoppers are switching orders to Amazon and Walmart.com. Many restaurants that have stayed open won't take cash, and operate without any contact at all, requiring customers to pay first online. What once seemed like the oldest, most reliable way of paying now seems fraught: A physical object changing hands, bringing people closer than 6 feet, covered in who knows what. 'Do I want to grab the thing that you were just holding in your hand? No,' says Harvard economist Kenneth Rogoff, who has advocated for a less-cash society, and predicts the crisis 'is absolutely going to drive people to prefer credit and debit to cash.' Filling the void, in many cases, are digital payments that are quick, clean and easy. That sudden shift is a huge opportunity for tech firms such as online payments giant PayPal, which also owns the Venmo app....Now, in the U.S., the government has been moving in this direction of its own accord, discouraging paper checks in a rush to get stimulus money out to Americans. But the sharp jag away from cash also worries those who look out for older and poorer Americans - groups that tend to be more reliant on paper money either for lack of tech savvy, out of habit or because they don't participate in the formal banking system....There's an ideological component as well: Among cash's strengths is that it's universally accepted and difficult to track, giving Americans a just about anonymous way to, say, donate to their preferred church or live out their life as a persecuted minority or back a dissident group. 'Some of us still use cash because we think it's nobody’s business,' says Jim Harper, a visiting fellow with the libertarian-leaning American Enterprise Institute. For more than 200 years, paper cash has been at the heart of the American economy. How close could coronavirus come to killing off cash - and if it does, is society ready?....Of course, there's another possibility. And that's that cash comes roaring back after coronavirus, perhaps something like the handshake, a practice that seemed odd, even foolhardy during the pandemic but that we return to out of habit or, as it turns out, it still has its place."
Our sleep is linked to how we process coronavirus dread -Quartz
"Whether it's insomnia, strange dreams, or even sleeping too much, sleep disturbances are part of our body's response to trauma and anxiety. Everyone will react to these situations differently - but experts have helpful information to share about ways to improve your rest. 'We are in the midst of collective trauma,' says Christy Beck, a therapist based in State College, Pennsylvania. 'And sleep disturbance is a common trauma response, along with anxiety and depression.' Beck says that stress can cause a variety of sleep disorders, including insomnia - not being able to fall asleep - and its opposite, hypersomnia....Here are some of the strategies that may help you get a better rest: 1) Keep a regular schedule. Go to sleep and wake up at the same times each day....2) Exercise regularly. Incorporate some form of physical activity into your routine....3) Self-care. Spend more time on mindfulness, coping, and taking care of yourself....4) Avoid stressors. Limit the amount of Covid-19 news you are consuming....5) Assign spaces. If possible, keep the bedroom space for sleeping....6) Be easy on yourself. Doing deep abdominal breathing, progressive muscle relaxation, or thinking of soothing imagery as you fall asleep."
Our Restaurants Can't Reopen Until August -Huffman/Wall Street Journal
"My company works with local chefs to open and operate their restaurants. We are currently a partner in more than 20 of them. We closed our dining rooms March 15, two days before the governor mandated we do so, and had to lay off some 700 employees...Although our limited operations leave us at only 30% of our usual revenue, takeout and delivery has worked better than expected at most locations. After two weeks of getting the systems in place and understanding the challenges of a different business model, we realized that we needed to hire back some of our staff to help with the demand. That proved harder than we expected. We started making the calls last week, just as our furloughed employees began receiving weekly Federal Pandemic Unemployment Compensation checks of $600 under the Cares Act. When we asked our employees to come back, almost all said, 'No thanks.' If they return to work, they'll have to take a pay cut. The starting wage for a line cook in one of our restaurants is $15 an hour. These cooks receive at least $1 an hour in tips, so at a minimum they make $16 an hour, or $640 before taxes for a 40-hour week. The overwhelming majority of our laid-off cooks qualified for Oregon unemployment compensation of 1.25% of their annual gross wages weekly, or $416 in our example. The extra $224 a week provides a strong incentive to return to work. But as of this week, that same employee receives $1,016 a week, or $376 more than he made as a full time employee. Why on earth would he want to come back to work?....And it will persist at least until July 31, when the unemployment bonus expires. I'd have to offer my cooks $25.40 an hour to match what the government is paying them not to work....We plan to open our dining rooms on Aug. 1, once the government stops paying people $15 an hour, on top of standard unemployment compensation, to stay home."
4.22.20 - Gold to Reach $3,000 -Bank of America
Gold last traded at $1,735 an ounce. Silver at $15.28 an ounce.
NEWS SUMMARY: Precious metal prices resumed their upward climb Wednesday on safe-having buying. U.S. stocks rose for the first time in three days as crude prices tried to stabilize after a record plunge.
Gold to Reach $3,000 - 50% Above Its Record, Bank of America Says -Yahoo Finance
"Bank of America Corp. raised its 18-month gold-price target to $3,000 an ounce - more than 50% above the existing price record - in a report titled 'The Fed can't print gold.' The bank increased its target from $2,000 previously, as policy makers across the globe unleash vast amounts of fiscal and monetary stimulus to help shore up economies hurt by the coronavirus. 'As economic output contracts sharply, fiscal outlays surge, and central bank balance sheets double, fiat currencies could come under pressure,' analysts including Michael Widmer and Francisco Blanch said in the report. 'Investors will aim for gold.' BofA expects bullion to average $1,695 an ounce this year and $2,063 in 2021. The record of $1,921.17 was set in September 2011....'Beyond traditional gold supply and demand fundamentals, financial repression is back on an extraordinary scale,' the report said."
The Extremely Overvalued & Top Heavy U.S. Stock Market -Global Macro Monitor
"After the Fed effectively fully nationalized the financial markets by bailing out junk bonds on April 9th, turning Wall Street into a Soviet Sausage Factory, almost any type of analysis, which was on its way out anyway, was rendered completely meaningless. The new rocket scientists on Wall Street are the market Kremlinologists, who try to guess the new ranges where the Politburo will set yields and how many notes and bonds the Kommissar of Free Money is going to buy in order to monetize a $4 trillion-plus deficit and help rollover existing maturities. All good until it isn't. The monetary authorities had little choice but to try and keep the ship afloat to fight another day, but junk bonds? With the funky action going on in crude, the markets could use a few less drillers, ergo less supply, but that is less likely as their junk debt is now backstopped. Here's to hoping there is an adjustment to policy after the panic subsides....The market does appear to be looking forward to the other side. The new world looks like one with a few high tech giants in a less mobile (physical), work from home world. Maybe. Not sure if that is good, sustainable or the body politic will stand for it....This BofA chart comes to us via the great Kiwi analyst, Callum Thomas...As of the Friday close, the big five alone make up 17.97% of the value of almost all publicly traded stocks in the United States as measured by the Wilshire 5000. Stunning....Unless we are on the road to runaway inflation, not a zero probability with all the monetization that is coming, this bounce is an incredible gift to rebalance, take some risk off, go to the virtual beach and wait this thing out....We like to buy low, sell high. Most prices are way too high...Still sitting on the couch with cash and gold."
Senate Passes Bill for More Small-Business Stimulus -Wall Street Journal
"Congressional leaders struck a deal with the White House Tuesday to send hundreds of billion of dollars in fresh aid to small businesses and hospitals, the federal government's latest effort to keep pace with the twin economic and public health crises created by the coronavirus pandemic. The Senate on Tuesday evening passed the $484 billion bill by a voice vote, sending it to the House for an approval expected Thursday...The package, which lawmakers dubbed an interim emergency bill, also includes funding to ramp up the country's testing for the new coronavirus, but doesn't include funding sought by Democrats for hard-hit state and local budgets. Top Republicans signaled that concerns over the mounting debt would play a bigger role in talks about future stimulus aid, setting up a sharp divide with Democrats worried that Congress has done far from enough. Congress has operated in emergency mode during the outbreak, last month passing a $2.2 trillion package by consensus with minimal debate.....'At the core of our agreement is $320 billion more for the Paycheck Protection Program, which is already saving millions of small-business jobs and helping Americans get paychecks instead of pink slips,' Senate Majority Leader Mitch McConnell (R., Ky.) said on the Senate floor Tuesday....The bill tasks the Trump administration with outlining how the U.S. can further expand its testing capacity in a plan that will be updated every 90 days.States and localities will also be required to submit their own testing plans to the federal government."
Nobody's Talking About the Banks -Morningstar
"In the single month of October 2008, Wachovia Bank, Royal Bank of Scotland, Lloyds of London, UBS, and National City Bank vanished, being either seized by their governments or acquired at fire-sale prices by their competitors. Bank failures were the economic story of autumn 2008 - which is why that year's stock bear market is widely known as the 'global financial crisis.' Not so much in 2020. The COVID-19 crisis has elicited much discussion about widespread unemployment, gyrating stock prices, and grim prospects for companies that depend upon travel (along with bright forecasts for firms that deliver their goods or services to households). Absent from the news have been the banks. Thus far, they have steered clear of the headlines....More than half the loans of America's four largest banks - (JPMorgan Chase), (Bank of America), (Citigroup), and (Wells Fargo) - are either to businesses or for residential mortgages. Many of the former will soon default, because companies that are shuttered will likely defer their bills....Bank stocks, predictably, have been whacked. Morningstar's Diversified U.S. Banks Index has dropped 35% for the year to date, as opposed to a mere 11% for the S&P 500....The enormous uncertainty about when and how the global economy can resume something approaching normalcy overwhelms the analysis."
4.21.20 - What's Next for Gold -The Aden Sisters
Gold last traded at $1,687 an ounce. Silver at $14.87 an ounce.
NEWS SUMMARY: Precious metal prices stepped back Tuesday on short-term profit-taking to help alleviate investor liquidity demands. U.S. stocks fell sharply once again as oil prices continued their unprecedented wipeout.
What's Next for Gold -Aden Sisters/Yahoo Finance
"Yes, the economy is going to suffer, but we don't yet know how bad it's going to be. For now, the world's big central banks and governments are doing all they can to keep the financial system working and intact. Emergency financing is needed all over the world. The Fed, for instance, is printing money like mad. They're also buying tons of U.S. government bonds, mortgage backed securities and now corporate bonds....It'll end up fueling a big inflation down the road...The bottom line, this is a major event that's going to change many things. So keep your gold and be prepared for whatever comes our way....The ratio of gold to stocks jumped up above its mega 80-month moving average, to favor gold for the first time since its high area in 2011. The trend since 1999 and this ratio have confirmed a mega trend change favoring gold. With gold above $1536, it's on its way to the 2011 highs! And indeed if gold breaks and stays above $1700, this target could be reached sooner than we think! Gold will surely be volatile as the pandemic evolves, but look at this as time to get set for the major rise should weakness occur. Gold is the strongest precious metal...It reached a record high versus silver and platinum. And it's positioned to rise in a several year rise ahead. This year will likely continue to see volatile moves with the ebbs and flows of the virus, and don't be discouraged by this."
Dow plunges 700 points, bringing two-day losses to nearly 1,300 points -CNBC
"U.S. stocks fell sharply again on Tuesday as oil prices continued their unprecedented wipeout. The Dow Jones Industrial Average slid 700 points, or more than 2%. Tuesday's losses brought the Dow's two-day decline to nearly 1,300 points. The S&P 500 dropped 3.3% while the Nasdaq Composite fell 3.9%. Traders were focused on the strange happenings with oil futures once again, which raised concern about deep losses for the energy industry hitting the U.S. economy even further. On Monday, the May contract for oil futures expiring Tuesday fell to zero and then went to an actual negative price, meaning producers would pay for someone to take the oil off their hands. The bizarre move has to do with the fact that because of the coronavirus shutdowns, big buyers of oil like refineries don’t need any more oil because their tanks are nearly filled....More concerning to traders on Tuesday was the selling now occurring in later month contracts for oil futures. The more actively traded June oil contract was down 35% at $13.27 Tuesday....Investors continued to monitor the coronavirus pandemic and the country's plan to reopen the economy. Signs have emerged that New York is past the worst of its outbreak...'Market volatility remains intense, as subtle changes in the tone of the news drives dramatic shifts in investor sentiment,' said Mark Hackett, Nationwide's chief of investment research."
Bets Against the Stock Market Rise to Highest Level in Years -Wall Street Journal
"Short sellers have revived their wagers against the stock market in recent weeks, taking their most aggressive positions in years. Bets against the SPDR S&P 500 Trust, the biggest exchange-traded fund tracking the broad index, rose to $68.1 billion last week, the highest level in data going back to January 2016, according to financial analytics company S3 Partners. That was up from $41.7 billion at the beginning of 2020 and $41.2 billion a year ago. Short sellers borrow shares and sell them, hoping to repurchase them at lower prices and keep the difference as profit. Among the individual companies they have targeted in recent weeks are travel-related firms, including Carnival Corp., Royal Caribbean Cruises Ltd., Marriott International Inc. and Wynn Resorts Ltd. Those bets come during a wild year for investors who are struggling to reconcile the impact of the coronavirus pandemic on the population and economy. The S&P 500 suffered its fastest drop from a record to a bear market in history - ultimately falling 34% between Feb. 19 and March 23....'We've really seen a significant bounceback in the last three weeks at levels that I think are too quick,' said Jerry Braakman, chief investment officer at First American Trust....Investors are bracing for the possibility of more volatility this week, as earnings reports from companies including Coca-Cola Co., Netflix Inc. and Delta Air Lines Inc. give another glimpse at how the coronavirus is reshaping the landscape for U.S. business."
Why Walking Matters - Now More Than Ever -Wall Street Journal
"Why does walking make us feel good?...Walking is especially important now, with gyms and team sports shut down. It's one of our few accessible forms of exercise but also one that is directly affected by stay-at-home orders....Walking is somehow more 'mindful' now. What we probably don’t realize is that walking can be a kind of a behavioral preventive against depression. It benefits us on many levels, physical and psychological. Walking helps to produce protein molecules in muscle and brain that help repair wear and tear. These muscle and brain molecules - myokines and neurotrophic factors, respectively - have been intensively studied in recent years for their health effects....Walking upright is one thing that sets humans apart; no other animal does it, but we can't do without it....Movement through the world changes the dynamics of the brain itself. Recent experiments show that walking increases the strength of the signals in parts of the brain concerned with seeing and other senses, such as touch....Recent experiments show that as few as three or four days of inactivity reduces muscle mass in the legs, starting to replace muscle with deposits of fat. This isn't much of a problem when you're 30, but it is when you are 60...The cure? Get up, walk about and fight the frailty that can come with aging. Walking is the movement that we all profit from...Walk we must, and walk we should, to keep our mental and physical worlds open and to stop the walls from closing in."
4.20.20 - Can America's Safety Net Be Fixed?
Gold last traded at $1,710 an ounce. Silver at $15.53 an ounce.
NEWS SUMMARY: Precious metal prices rose Monday on safe-haven buying despite a firmer dollar. U.S. stocks fell as investors weighed the latest coronavirus news along with a decline in U.S. crude prices.
Why people consider gold to be a ‘safe haven’ in crises like the coronavirus -CNBC
"'Gold is a way of going long on fear,' renowned investor Warren Buffett once said....Investors' fear levels are particularly high right now, as the coronavirus pandemic turned a global health crisis into an economic one. And it’s uncertain when the world will recover from either of these crises. It is in such times of uncertainty that gold is touted as a 'safe haven' for those looking for shelter from more traditionally volatile investments, like stocks. 'Compared to an investment in stocks, where even the biggest blue chip companies can (and have) failed, an investment in gold often seems less risky,' said Adam Vettese, market analyst at investment platform eToro. As the world's earliest form of currency, gold's physical properties have meant it has long been considered a reliable store of value. It is widely available enough to trade but is in finite supply, so is rare enough to be considered valuable and unlike some metals it is not corrosive, making it durable....Gold is also considered a good hedge against the risk of inflation because the rising cost of goods and services tends to erode the value of the dollar."
Oil Futures Crash By Most On Record, Tumbling To $11 Per Barrel -Zero Hedge
"Oil future prices crashed the most on record with the May WTI futures contract hitting its lowest level since 1999, plunging as low as $11 or down 38%, as nobody wants to take actual physical storage amid widespread fears crude storage will soon be full; meanwhile companies prepare to report the worst quarterly earnings since the financial crisis, while tens of thousands of people continue to get sick every day with the coronavirus...The sell-off was exaggerated by the contract's Tuesday expiry because no one wants to be left long to take delivery as there is nowhere to put the physical product. In any case, the 37% drop was the biggest one-day drop on record!....Meanwhile, with a record 198MMb/d now stored offshore, the volume of oil held in U.S. storage, especially at Cushing is rising as refiners throttle back activity in the face of weak demand. 'As production continues relatively unscathed, storage is filling up by the day. The world is using less and less oil and producers now feel how this translates in prices,' said Rystad’s head of oil markets, Bjornar Tonhaugen....After starting off higher, U.S. equity futures fell alongside European and Asian stocks on Monday as investors grappled with everything from the spread of the coronavirus to oil's collapse and the next raft of corporate earnings."
Social Distancing Has Made All of Us Helpers -Elemental/Medium
"The world is a frightening, uncertain place right now. But like Mr. Rogers said, when scary things happen, 'Look for the helpers. You will always find people who are helping.' In our current reality, helping looks different than it normally does. Instead of giving a friend a hug, bringing a neighbor soup, or volunteering in the community, it means staying home in order to flatten the curve. Stanford psychology professor Jamil Zaki, PhD, author of the book The War for Kindness: Building Empathy in a Fractured World, says that rather than making people act more selfishly, disasters bring out the altruistic urge in all of us. Elemental spoke with Zaki to understand how altruism is playing a role in the response to the coronavirus pandemic and find out how to strengthen feelings of empathy if you find yourself lagging....Jamil Zaki: Something like social distancing - I prefer the term physical distancing - would be a collective action problem. It's something where people have to work together and make sacrifices to assure a much more important, larger optimal outcome for a group. I think a media narrative that we hear often is that disasters bring out the worst in people and create social disorder...But when those norms go away, we revert to super-selfish, almost violent animalistic urges to protect and get whatever we want. It turns out that narrative is almost entirely backwards. During disasters, people are actually much kinder and more prosocial toward each other - not even kinder than they are cruel, but kinder than they are typically...We're all sharing this experience, and that shared experience is a vast conduit to kindness and altruism....My book is all about the idea that empathy is a skill, one we can learn through practice. And I think that is a really interesting part about this moment...the fact that we're all stuck in this new normal together, gives us the opportunity to create shared bonds that could last for a really long time."
Covid-19 shows where America's safety net is broken. Maybe now we can fix it. -Quartz
"Tens of millions of workers and their families are facing economic catastrophe. Along with the risk of contracting Covid-19, they are contending with cut hours, furloughs, and record-breaking job losses...As Americans are forced to confront both a health and economic crisis, many are relying on a safety net that is inadequate, inequitable, and antiquated....The coronavirus has shown a spotlight on these challenges, and increases the urgency to develop new and better systems that can help all workers, and not just those fortunate enough to work for a specific employer or meet specific eligibility requirements....As the economy eventually recovers, the job search and re-employment requirements for those receiving unemployment benefits need to be revised to consider the range of ways people work in the 21st century. Unemployment insurance typically requires recipients to demonstrate that they are actively seeking full-time work. Evidence from prior recessions suggests that available jobs are likely to include part-time, occasional, and independent arrangements. Taking advantage of these options can be an on-road in the short term to badly needed income and, in the long term, to more traditional employment....In times of economic crisis, unemployment insurance has a critical role to play in helping people who are struggling to afford rent, food, and other basic expenses. Important short-term reforms have been made to address the long-standing holes in the system. The question remains, however, whether unemployment insurance can be modernized into a 21st-century program that provides benefits to all workers, or whether the crisis will pass and a critical part of the safety net will be forgotten again until the next crisis emerges."
4.17.20 - What's Behind the Push for a Cashless Society?
Gold last traded at $1,694 an ounce. Silver at $15.29 an ounce.
NEWS SUMMARY: Precious metal prices eased back Friday on profit-taking despite a weaker dollar. U.S. stocks rose amid rising hope that a Gilead Sciences drug would prove to be an effective treatment of the coronavirus.
Gold's Transformation To A Currency Has Begun -Seeking Alpha
"It appears that the bubble has been broken, and the facade of manipulation by the Feds has been revealed. The system was very fragile and risky. All we needed was something like COVID-19 to push us over the edge. Gold is transforming from a commodity into an alternative currency of a sort. We are looking at a paradigm shift in relation to interest rates. The government has suppressed the price of gold and many other assets. This has distorted the financial system, and we are now looking for the markets to find the real prices of various assets...The volatility we are seeing from stocks to commodities to bonds is a reflection of this attempt to re-calibrate the prices of all of these assets. No one really knows what is going to happen at this stage. We are in the midst of a major economic transformation. We have a triple threat of an economic, health, and political crisis all at once....The precious metals are becoming a real safe-haven asset once again. It is one of the ways to hedge against the potential crises that we are facing. This huge adjustment to the crisis also presents massive opportunities, such as in the precious metals markets....Silver is the most oversold asset. The price does not reflect the current economic condition which we are in. It has been suppressed, just as gold has been....With some fears that cash may be infected with the coronavirus, it may be a time to introduce a virtual currency backed by gold. Maybe. We believe that the precious metals markets, and especially gold, are going to do very, very well during and after the current crisis. Gold may be the way to restore confidence in the monetary system."
Gilead data suggests coronavirus patients are responding to treatment -Stat News
"A Chicago hospital treating severe Covid-19 patients with Gilead Sciences' antiviral medicine remdesivir in a closely watched clinical trial is seeing rapid recoveries in fever and respiratory symptoms, with nearly all patients discharged in less than a week, STAT has learned. Remdesivir was one of the first medicines identified as having the potential to impact SARS-CoV-2, the novel coronavirus that causes Covid-19, in lab tests. The entire world has been waiting for results from Gilead's clinical trials, and positive results would likely lead to fast approvals by the Food and Drug Administration and other regulatory agencies. If safe and effective, it could become the first approved treatment against the disease. The University of Chicago Medicine recruited 125 people with Covid-19 into Gilead's two Phase 3 clinical trials. Of those people, 113 had severe disease. All the patients have been treated with daily infusions of remdesivir. 'The best news is that most of our patients have already been discharged, which is great. We've only had two patients perish,' said Kathleen Mullane, the University of Chicago infectious disease specialist overseeing the remdesivir studies for the hospital....In scientific terms, all the data are anecdotal until the full trial reads out, meaning that they should not be used to draw final conclusions. But some of the anecdotes are dramatic."
COVID-19 and the War on Cash: What Is Behind the Push for a Cashless Society? -Whitehead/Global Research
"Cash may well become a casualty of the COVID-19 pandemic. As these COVID-19 lock downs drag out, more and more individuals and businesses are going cashless (for convenience and in a so-called effort to avoid spreading coronavirus germs), engaging in online commerce or using digital forms of currency (bank cards, digital wallets, etc.). As a result, physical cash is no longer king. Yet there are other, more devious, reasons for this re-engineering of society away from physical cash: a cashless society - easily monitored, controlled, manipulated, weaponized and locked down - would play right into the hands of the government (and its corporate partners). To this end, the government and its corporate partners-in-crime have been waging a subtle war on cash for some time now....Much like the war on drugs and the war on terror, this so-called 'war on cash' is being sold to the public as a means of fighting terrorists, drug dealers, tax evaders and now COVID-19 germs. Digital currency provides the government and its corporate partners with the ultimate method to track, control you and punish you. In recent years, just the mere possession of significant amounts of cash could implicate you in suspicious activity and label you a criminal....It's not just cash that is going digital, either. A growing number of states are looking to adopt digital driver's licenses that would reside on your mobile phone. These licenses would include all of the information contained on your printed license, along with a few 'extras' such as real-time data downloaded directly from your state's Department of Motor Vehicles. Of course, reading between the lines, having a digital driver's license will open you up to much the same jeopardy as digital cash: it will make it possible for the government to better track your movements, monitor your activities and communications and ultimately shut you down....If there’s one entity that will not stop using cash for its own nefarious purposes, it's the U.S. government. Cash is the currency used by the government to pay off its foreign 'associates.' For instance, the Obama administration flew more than $400 million in cash to Iran, reportedly as part of a financial settlement with the country. Critics claim the money was ransom paid for the return of American hostages....So when government economists tell you that two-thirds of all $100 bills in circulation are overseas - more than half a trillion dollars' worth - it's a pretty good bet that the government played a significant part in their export."
The Pandemic of Fear and Agony -Brooks/New York Times
"Last week I asked you to tell me about your mental health - how you are faring in this hard time...There have been over 5,000 replies so far, and while many people are hanging in there, there is also a river of woe running through the world - a significant portion of our friends and neighbors are in agony. A college student in State College, Pa., wrote that at first the lockdown seemed like a lark - a chance to get out of certain obligations. But 'now almost a month into staying here, I've been gripped by a deep depression. My appetite is very low. I'm sleeping far too much to feel as lethargic as I do. My future, which seemed so bright a few months ago as I anticipated graduating in May, now seems bleak and hopeless: How will I find a job with the economy tanking? How will I pay hundreds of dollars per month when my loan bills kick in during August?'....Senior citizens are especially hard hit, particularly the widows and widowers. For many, it’s the painful sense of missing their grandkids, the precarity of living with a disease that could kill them at any time. For others, it's the wrenching loneliness. 'The combination of isolation and stress is having compounded impact. I am 65, and a single woman with no nearby family. My surviving sibling lives several hours away.'....Some people are active for days, frantically cleaning the house, and then one day they just shut down and cry. A person from Denver is worn down by being so suspicious of others and asked, 'Why am I suddenly afraid of the mail carrier or the food delivery?'....There's a heroism in the vulnerability you display in these letters, a courageous willingness to share your fears...spiritual growth pulses through the paragraphs. An atheist wrote that he prays daily, though he doesn't know to whom. Many people are reading Viktor Frankl. 'I am looking at this as a type of monastic retreat. I am hoping that we come out of this crisis as a nation with a renewed sense of perspective, a new sense of our dependence on each other.' I'm reminded that this is a time to practice aggressive friendship with each other - to be the one who seeks out the lonely and the troubled. It's also true that character is formed in times like this. People see deeper into themselves, bravely learn what their pain is teaching them, and become wiser and softer as a result."
4.16.20 - How Coronavirus Is Eroding Privacy
Gold last traded at $1,735 an ounce. Silver at $15.64 an ounce.
NEWS SUMMARY: Precious metal prices rose again Thursday on safe-haven buying despite a firmer dollar. U.S. stocks traded mixed in volatile trading as Amazon and Netflix reached record levels, while investors digested data reflecting the economic devastation from the coronavirus pandemic.
Gold rises 1% as central bank stimulus fuels investor interest -CNBC
"Gold prices rose more than 1% on Thursday as a raft of stimulus measures from central banks to counteract the coronavirus crisis drove investors into bullion as a safe store of value, while sombre U.S. economic reports stoked fears of a global recession....'The main factor supporting gold at the moment is the extraordinary amount of stimulus from central banks. I don't think it's been fully priced in yet,' OANDA analyst Craig Erlam said. 'The record highs hit in the aftermath of the global financial crisis, and even higher, look perfectly reasonable, under the circumstances. The $1,800 level does not seem very far away.'....Gold, which is often used as a safe store of value during times of political and financial uncertainty, is highly sensitive to interest rates, as lower rates reduce the opportunity cost of holding non-yielding bullion. Central banks have rolled out a wave of fiscal and monetary measures to ease the economic damage from the virus, which has infected more than 2 million people globally and killed 136,667....'While gold will continue to be in demand, sometimes investors need funds to cover their margin calls, so losses in other financial assets might lead to falls in the gold price,' said John Sharma, economist at National Australia Bank."
How Coronavirus Is Eroding Privacy -Wall Street Journal
"The Covid-19 pandemic is ushering in a new era of digital surveillance and rewiring the world's sensibilities about data privacy. Governments are imposing new digital surveillance tools to track and monitor individuals. Many citizens have welcomed tracking technology intended to bolster defenses against the novel coronavirus. Yet some privacy advocates are wary, concerned that governments might not be inclined to unwind such practices after the health emergency has passed. Authorities in Asia, where the virus first emerged, have led the way. Many governments didn't seek permission from individuals before tracking their cellphones to identify suspected coronavirus patients...In Europe and the U.S., where privacy laws and expectations are more stringent, governments and companies are taking different approaches. European nations monitor citizen movement by tapping telecommunications data that they say conceals individuals' identities. American officials are drawing cellphone location data from mobile advertising firms to track the presence of crowds - but not individuals. Apple Inc. and Google recently announced plans to launch a voluntary app that health officials can use to reverse-engineer sickened patients' recent whereabouts - provided they agree to provide such information....Data flowing from the world's 5.2 billion smartphones can help identify who, where and how people get infected - and lasso in those who might. The extent of tracking hinges on a series of tough choices: Make it voluntary or mandatory? Collect personal or anonymized data? Disclose information publicly or privately?....Surveillance efforts this time around have a new ally: public-health experts. They say some form of digital tracking will be necessary in the months ahead, even as people return to more normal lives after city lockdowns relax....Lawmakers are learning that voluntary contact-tracing apps that claim to preserve users' privacy, such as the one proposed by Apple and Google, aren't effective without high levels of participation."
Money Is Losing Its Meaning -Bloomberg/Yahoo Finance
"Doing 'whatever it takes' to save the global economy from the coronavirus pandemic is going to cost a lot of money. The U.S. government alone is spending a few trillion dollars, and the Federal Reserve is creating another few trillion dollars to keep the financial system from collapsing....These numbers are so large that they no longer have any meaning; they are simply abstractions. It's been some time since people thought about the concept of money and its purpose...Former Fed Chairman Paul Volcker once said in an interview that 'it is a governmental responsibility to maintain the value of the currency they issue. And when they fail to do that, it is something that undermines an essential trust in government.' The dollar has no real intrinsic value, backed only by the full faith and credit of the U.S. government. Under a fiat currency system, the government says that a dollar is a dollar. Its value relative to things such as other currencies and gold is determined on global markets. Gold is considered to be an objective store of value, and the metal's rise in dollar terms can be expressed another way, which is that the dollar fell in gold terms. The three main functions of a currency are as a unit of account, a medium of exchange and a store of value. It is that last function that is most important....Nobody really knows how this is going to turn out. In smaller economies, runaway government spending has resulted in hyperinflation and social unrest, such as well-documented cases in Venezuela and Zimbabwe. Many think that wouldn't be possible in the U.S. given the dollar's role as the world's primary reserve currency. Perhaps, but it's not one of those questions we'd really want to experiment with. If all this money that's being created does spark inflation, it will be difficult - if not impossible - to reverse....Throughout Venezuela's economic crisis, we saw images of Venezuelans tossing their useless bolivars in the streets. That is what happens when money has lost all meaning."
This is the end of the office as we know it -Vox
"If and when you return to your office after the novel coronavirus pandemic, you'll probably notice some differences. Upon entering your building, the doors may open automatically so you don't have to touch the handles. Before you board your elevator, you might tell the elevator where you'd like to go, rather than pressing the many buttons within the elevator. When you reach your floor, you could walk into a room full of dividers and well-spaced desks instead of the crowded open floor plan you're used to. In common areas like meeting rooms and kitchens, expect to see fewer chairs and posted documentation of the last time they were cleaned....Of course, this is all assuming you go back to your old office at all. As the coronavirus takes a steep toll on the economy and the workforce, many won't have jobs to go back to. Some who are still employed will now permanently work from home, and some employers will choose to downsize their leases or look for flexible office space rather than long-term leases....Just as policies around telehealth and liquor have quickly shifted, the Covid-19 crisis will force swift and permanent changes in both commercial real estate and work culture itself. The office as we know it will never be the same. According to a new MIT report, 34 percent of Americans who previously commuted to work report that they were working from home by the first week of April due to the coronavirus. These new numbers represent a seismic shift in work culture. Prior to the pandemic, the number of people regularly working from home remained in the single digits, with only about 4 percent of the US workforce working from home at least half the time....Regardless of how prepared they were, people have done what they had to do to make working from home work. In doing so, they moved the needle on what's acceptable in the at-home office. 'It added some humanity to us,' said Kate Lister, president of consulting firm Global Workplace Analytics. 'You don't have a choice: The dog is going to walk through the meeting, your child is going to walk through. Period. We've just relaxed our standards to that. Maybe it will bring us closer.'"
4.15.20 - A Second Round of Coronavirus Layoffs Has Begun
Gold last traded at $1,744 an ounce. Silver at $15.61 an ounce.
NEWS SUMMARY: Precious metal prices consolidated recent gains Wednesday on mild profit-taking and a firmer dollar. U.S. stock resume their decline as dismal economic data and weak bank earnings fueled concerns over the coronavirus’s impact on the U.S. economy.
A gold price rally to $2,000 would not be a surprise -Sprott/Kitco
"Gold prices have pushed to nearly an eight-year high, and this is only the start as investors should keep an eye on the precious metal's long-term outlook, according to one gold fund executive. In a telephone interview with Kitco News, Peter Grosskopf, chief executive officer at Sprott Inc., said that the gold market's future looks bright as the global economy deals with unprecedented stimulus during a time of unprecedented uncertainty. 'Investors should continue to consider gold as a unit of currency or a purchasing power that can maintain its value against other assets,' he said.....'Gold has been acting very well in the last month. All the technicals show that its uptrend will be maintained in the short, medium and long term,' he said. 'We would expect to see prices over $2,000 by sometime early next year. That is not a surprise, fundamentally either, in the current environment.'....He added that there is scope for gold to do well in both an inflationary and deflationary environment. 'If you get deflation and you get a real crash in the financial system, want to be holding some gold,' he said. 'And if you get the recovery, you will now have an extra $6 or $7 trillion floating around financial markets. That is when you really want to hold some gold to protect against inflation."
Why the stock market is nowhere near a bottom -Marketwatch
"Stock prices have rebounded on the news that the COVID-19 pandemic is improving in New York and other parts of the U.S., and on the news that the Fed unveiled another $2.3 trillion bazooka of liquidity. Despite these positives, several important factors, including long-term market psychology, technical-cycle analysis, valuation, and smart investor behavior, suggest that this bear market has not yet seen its low point. 1. Investors are too bullish - Instead of fear, investors are exhibiting signs of greed. Investor psychology just doesn't behave that way at major market lows. 2. No technical signs of a long-term bottom: I see no signs of a long-term bottom....Market bottoms are also characterized by changes in leadership. Bear markets are forms of creative destruction. 3. Valuation headwinds: The S&P is currently trading at a forward P/E ratio of 17.3, which is above its 5-year average of 16.7 and 10-year average of 15.0....The 2002-2003 bottom saw a forward P/E ratio of about 14...The 1987, 1990, 2009, and 2011 bottoms all saw forward P/E ratios of about 10. 4. What are smart investors doing? ...What has Berkshire done now? It is raising cash. Unless a population were to acquire herd immunity, either allowing COVID-19 to run rampant through its people, or through some medical treatment that controls the outbreak, governments are going to be playing the game of whack-a-mole with this virus for some time."
The End of Cash? -BloombergQuint
"Do we still need cash? Humans have used all sorts of things as stores of value - rare metals, strings of shells, even jugs of whiskey. Over time the objects have become more ephemeral, from coins to paper to digital forms....As the coronavirus pandemic spread in early 2020, some merchants in Seattle and Sydney tried to stop accepting cash altogether, calling it unsanitary. (Some U.S. cities have made cashless stores illegal to prevent discrimination.)....Some economists say that without cash, central banks could fight recessions more effectively because they’d have an effective way to impose negative interest rates - basically a tax on savings meant to spur spending. Critics say that in a digital-only economy, governments and banks could take control of your financial life, leaving you penniless with a flick of a switch....For governments, getting rid of cash would cut minting and distribution expenses and make it easier to crack down on tax evasion and drug trafficking. Stores could save on cash-handling costs, reduce theft and possibly earn more if faster checkouts led to more transactions per hour, as some salad chains found in a trial...The Fed has stayed on the sidelines, saying there are 'substantial' issues around cybersecurity to be resolved. For the world's poor, going cashless would cut both ways."
A Second Round of Coronavirus Layoffs Has Begun -Wall Street Journal
"The first people to lose their jobs worked at restaurants, malls, hotels and other places that closed to contain the coronavirus pandemic. Higher skilled work, which often didn't require personal contact, seemed more secure. That's not how it's turning out. A second wave of job loss is hitting those who thought they were safe. Businesses that set up employees to work from home are laying them off as sales plummet. Corporate lawyers are seeing jobs dry up. Government workers are being furloughed as state and city budgets are squeezed. And health-care workers not involved in fighting the pandemic are suffering. The longer shutdowns continue, the bigger this second wave could become, risking a repeat of the deep and prolonged labor downturn that accompanied the 2007-09 recession. The consensus of 57 economists surveyed this month by The Wall Street Journal is that 14.4 million jobs will be lost in the coming months, and the unemployment rate will rise to a record 13% in June, from a 50-year low of 3.5% in February....The biggest wild card in the jobs outlook is how long it will take for jobs to bounce back, which depends heavily on how long the pandemic and social distancing measures last. The consensus among the economists surveyed by the Journal is for employment to return to its February 2020 level in 27 months."
4.14.20 - Morgan Stanley Publishes COVID-19 Timeline
Gold last traded at $1,768 an ounce. Silver at $15.95 an ounce.
NEWS SUMMARY: Precious metal prices rose again sharply Tuesday on safe-haven buying and a weaker dollar. U.S. stocks rose as investors grew more optimistic about the coronavirus outlook while bracing for the start of the corporate earnings season.
Coronavirus Economic Reopening Will Be Fragile, Partial and Slow -Wall Street Journal
"Executives around the world who rapidly overhauled operations when the coronavirus struck, and the politicians who made them do it, are now focused on restarting the economy and their own businesses. That restart, according to interviews with leaders across a range of industries, suggests that back to normal will be anything but. The re-emergence over the coming weeks and months will be fitful, fragile and partial - and a bit dystopian, with frequent temperature checks, increased monitoring of employees and customers, and, potentially, blood tests to determine whether workers have likely immunity to the virus. Officials and business leaders predict that operations won't fully return to normal until an effective vaccine hits the market, estimated at least a year away....In many ways, companies are at the mercy of local and national governments to ensure that the reopening doesn't reinvigorate the virus, which has so far infected nearly 1.8 million people world-wide and caused at least 110,000 deaths. Large-scale testing and tracing programs will become the norm, placing the average person under much greater scrutiny by the state....'Testing capacity, which we still have to develop, that is going to be the bridge from where we are today to the new economy in my opinion,' New York Gov. Andrew Cuomo said Wednesday. 'It's going to be a testing-informed transition to the new economy.'....School systems and colleges are planning scenarios for a hoped-for return to campus in the fall, if not earlier. 'Do we thin the number of people on campus? Does it mean more online instruction? We're planning for any and all of those, including a very different type of year next year,' said David Greene, president of Colby College a private liberal-arts college in Waterville, Maine."
Gold's Powerful Rally Brings $1,800 Into View -Bloomberg
"Gold extended its rally to hit the highest in more than seven years on concern that the coronavirus pandemic will have a deep effect on the global economy, hammering corporate earnings while supercharging demand for havens. Gold prices in New York moved closer to $1,800 an ounce, a level last seen in 2011. Spreads between futures and spot prices remain wide, suggesting thinner liquidity, which is further exacerbating price dislocation. 'Liquidity conditions are challenging and market participants are understandably cautious,' said precious metal strategist Joni Teves....Bullion has soared this year as the global heath crisis tipped economies toward recession and spurred central bank interventions....Overall, gold still has room to run, according to Hans Goetti, founder and chief executive officer of HG Research. 'What's happening here is that the Fed is expanding its balance sheet and every other central bank in the world is doing the same,' he told Bloomberg TV. 'What you're looking at is massive currency debasement in the long term. That's the major reason why gold is higher, and I would think that over the next few weeks or months, we'’re probably going to retest the high that we saw in 2011.'"
Morgan Stanley Publishes Full Timeline Of Upcoming Coronavirus Milestones -Zero Hedge
"Now that it has become clear that every day that the US economic shutdown continues as a result of the coronavirus pandemic means billions in economic losses and untold damages to the social fabric of the United States where over 20 million people will soon be unemployed, what all analysts - and frankly everyone else - want to know is 1) when will the US reach the peak of the coronavirus curve and 2) when will the US start reopening. Addressing the first, the latest JPMorgan coronavirus 'curve' showed the US fast approaching the peak of the curve, i.e., the end of the 'late accumulation' phase, and sliding into recovery. Yet while the first wave of the pandemic appears to be approaching its zenith, the big concern is that a second, even more powerful wave may emerge afterwards if the Spanish flu pandemic is any indication....Morgan Stanley's chief biotech analyst Matthew Harrison writes that 'recovering from this acute period in the outbreak is just the beginning and not the end' and 'the path to re-opening the economy is going to be long. It will require turning on and off various forms of social distancing and will only come to an end when vaccines are available, in the spring of 2021 at the earliest.'....'This view on the delayed peak and slow return to work has led our US economists to revise their US forecast to a return to pre-COVID-19 levels not until 4Q21,' Harrison writes, but concludes on a positive note, pointing out that there are promising antivirals and antibody therapies in the pipeline with data starting in April and continuing through the late summer."
Coronavirus economy could burst America's big-city rent bubble -NBC News
"The gridlocked coronavirus economy could upend housing from coast to coast, bursting national apartment rents that have risen by 150 percent over the last decade, experts say....More than half of the 600 concerned landlords on a conference call Wednesday with the Apartment Association of Greater Los Angeles said they have tenants who haven't fully paid their April rent, according to Executive Director Daniel Yukelson. 'It does show you the impacts the crisis is having on both owners and renters,' he said by email. Overheated rents are blamed in part for the rise in homelessness and 'deaths of despair,' as well as the need for 13 million Americans to take on more than one job. More than a third of U.S. homes are rented....'Rents will fall,' said David Shulman, a senior economist with the Anderson Forecast at UCLA. 'But income is going to drop.' The months ahead could bring a construction slowdown caused by a skittish luxury market, while landlords could face their own cash crunches as renters default, said Whitney Airgood-Obrycki, a research associate at Harvard University's Joint Center for Housing Studies. It's also likely that many renters will move in with family and friends and that homelessness will continue to rise, she said. 'With this pandemic, what is likely to happen is people will lose a significant portion of income, so we're likely to see more doubling up for housing,' she said. 'We're also going to see rent discounting and a lot of rent concessions.'....Some Airbnb hosts affected by the freeze on travel and tourism say they're considering opening their units to long-term renters, which could increase supply and, theoretically, depress rents....Some experts believe the impact of the coronavirus on the economy could upend housing in the U.S., with density pressure in markets like New York, Los Angeles and San Francisco giving way to renewed migration to the suburbs."
4.13.20 - Virus Has Transformed How Americans Spend
Gold last traded at $1,767 an ounce. Silver at $15.64 an ounce.
NEWS SUMMARY: Precious metal prices rose sharply Monday on continued safe-haven buying despite a firmer dollar. U.S. stocks resumed their decline as investors continued to weigh the coronavirus outlook along with a historic oil production cut.
Why Gold Continues to Make Higher Highs -McCullough/Hedgeye
"The runway for gold is clear to make its fourth set of higher highs from the low end of where we got it. For a lot of you who are new to our process, we've been buying gold since $1200 back in October of 2018. That's when the peak of the U.S. Economic Cycle was in. Now you know that historical fact. That's when you should have started buying Treasuries, buying Gold, and buying Utilities. There are four specific ramps in Gold going to new highs, and you could have risk managed them the whole way. Now some people who are new to this, and some people who don't do what I tell them to do...Then they turn to me and say 'Keith I'm not getting the low end of the range!' Well that's really not my problem. Unfortunately you weren't following us back in 2018. This has been a core position and it's all systems go."
Looming Earnings Season Offers Next Test for Stock Market -Wall Street Journal
"The kickoff of earnings season this week will give investors a first glimpse of the impact of the coronavirus shutdown on corporate profits - and potentially clues about the outlook for the rest of the year....The pandemic is expected to cause a severe economic contraction and a sharp decline in corporate earnings in 2020. What remains unknown is the extent of the damage. Companies from General Electric Co. to FedEx Corp. and Starbucks Corp. have warned they can no longer forecast their own results in a period of such uncertainty. Businesses across the country say revenue has evaporated following stay-at-home orders and the closure of nonessential businesses, leading them to furlough employees and drastically cut spending as they try to stay afloat....Some analysts worry the stock market is on the cusp of a reckoning and another painful selloff could be in store if corporate profits plunge. Others fear Wall Street's current earnings estimates don't fully reflect the extent of the expected damage....FactSet projects a 9% year-over-year decline in earnings for all of 2020, based on analysts' expectations for individual companies in the S&P 500, a sharp reversal from the 9.2% growth anticipated as last year ended."
Fed's Kashkari Says U.S. May Face 18 Months of Rolling Shutdowns -Bloomberg
"Without an effective therapy or a vaccine for the novel coronavirus, the U.S. economy could face 18 months of rolling shutdowns as the outbreak recedes and flares up again, Federal Reserve Bank of Minneapolis President Neel Kashkari said. 'We're looking around the world. As they relax the economic controls, the virus flares back up again,' Kashkari said Sunday on CBS's 'Face the Nation.' Kashkari is a voter in 2020 on the Fed's policy-setting Federal Open Market Committee. 'We could have these waves of flareups, controls, flareups and controls until we actually get a therapy or a vaccine. I think we should all be focusing on an 18-month strategy for our health care system and our economy.'....Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, said Sunday on CNN's 'State of the Union' that a partial reopening of the economy could possibly begin in May, but cautioned that the outbreak could flare up again in the fall....The economic pain is already severe. Almost 17 million people have filed for U.S. unemployment benefits in the last three weeks, implying a jobless rate of around 13% or 14%, with output in the second quarter expected to shrink sharply."
How the Virus Transformed the Way Americans Spend Their Money -New York Times
"The coronavirus has profoundly altered daily life in America, ushering in sweeping upheavals to the U.S. economy. Among the most immediate effects of the crisis? Radical changes to how people spend their money. In a matter of weeks, pillars of American industry essentially ground to a halt. Airplanes, restaurants and arenas were suddenly empty. In many states, businesses deemed nonessential - including luxury goods retailers and golf courses - were ordered closed. 'This is the sharpest decline in consumer spending that we have ever seen,' said Luke Tilley, chief economist at Wilmington Trust....Some companies like Walmart, Amazon and Uber Eats have seen spikes in purchases. But customers of many other businesses have simply stopped spending, the data shows....Beyond contributing to a record surge in unemployment claims, the ruined restaurant industry is likely to aggravate the country's broader economic woes. 'The service economy has traditionally been the thing that has helped keep the downturn from going too low,' Mr. Tilley said. 'In this case, the forced stoppage of consumer spending on these things is precipitating the economic crisis.'....For many, working from home has meant an end to commuting. As a result, taxis, ride sharing companies like Uber and Lyft, mass transit and parking services have all seen precipitous declines in sales....Spending is even down broadly across the health care industry for now, as those who conduct elective procedures, dentists and specialists not working on the coronavirus response are doing less business. Some hospitals, faced with lower revenues from canceled nonemergency work, have furloughed or cut the pay of doctors, nurses and other staff members."
4.9.20 - You Need Gold! -Forbes
Gold last traded at $1,731 an ounce. Silver at $15.80 an ounce.
NEWS SUMMARY: Precious metal prices shot up 2% Thursday as expanding Fed stimulus weakened the dollar. U.S. stocks rose as investors cheered the latest Fed efforts to support the economy and financial markets.
The U.S. Desperately Needs Inflation And You Need Gold -Haber/Forbes
"The United States fiscal and monetary worlds have entered a paradigm shift. Hard money, the Gold standard, fiscal austerity, the Federal Reserve as liquidity provider at a penalty rate with strong collateral: all of these are now squarely in the rear-view mirror. We have further moved on from ZIRP (Zero Interest rate policy), past Quantitative Easing (QE - AKA money printing), and have entered the world of Modern Monetary Theory (MMT). What is MMT? The federal government, through the Federal Reserve, prints as much money as politicians need for whatever purpose, and when you get inflation you tax the rich to slow it down....For years, prognosticators and politicians looking at the ballooning debt and deficits thought we could grow or tax our way out of trouble. Not anymore: The only way out of our ballooning fiscal crisis is to engender some inflation....We came into this virus war with $23T of federal debt and we will probably exit the fiscal 2020 year at close to $30T...The effects of this recession will lay bare these problems and only one solution: Make a trillion seem like a $100 bn through inflation....If the Fed wants more inflation, I want more gold. Our portfolios have had 5-10% for a while now and we are moving up to 15% - but 20% is not out of the realm of possibilities. I want it before the inflation arrives. The great hockey player Wayne Gretsky said 'skate to where the puck is going to be, not where it has been'. Gold will be where the money supply (m2) and inflation will take it....The CEO of Canadian gold miner Novagold recently said; 'What we've seen in the gold industry is that gold production has effectively peaked'. We have a good shot at new highs soon, after which we will go as far as the Fed is willing to take us. Prepare for the new paradigm."
Fed Announces New Facilities to Support $2.3 Trillion in Lending -Wall Street Journal
"The Federal Reserve unveiled an array of programs Thursday that it said would provide $2.3 trillion in loans, expanding the Fed's operations to reach small and midsize businesses and U.S. cities and states. The Fed also said it would include some classes of riskier debt that had been excluded....They take the Fed well beyond the lender-of-last-resort functions it played in 2008 to prevent a financial panic from deepening the economic downturn....'Our country's highest priority must be to address this public-health crisis, providing care for the ill and limiting the further spread of the virus,' said Federal Reserve Chairman Jerome Powell in a statement. The Fed said it would allow new classes of debt in the previously announced Term Asset-Backed Securities Lending Facility, or TALF, that were excluded from that facility when it was used after the 2008 financial crisis to support consumer and business credit markets. The Fed will now accept triple-A rated tranches of existing commercial mortgage-backed securities and newly issued collateralized loan obligations. Under TALF, the Fed lends money to investors to buy securities backed by credit-card loans and other consumer debt....After firing its arsenal at funding markets last month to prevent a public-health crisis from morphing into a financial crisis, the Fed later said it would throw another kitchen sink at credit markets that have broken down."
Great Depression Is Closest Parallel to Pandemic -Odey/Bloomberg
"The global economy is slipping into a 'different era' as the devastation in industries from oil to services roils markets, hedge fund manager Crispin Odey cautioned his investors. 'This is not like 2008-9, nor 2001-2, nor even 1989-92,' Odey wrote in a letter to clients seen by Bloomberg. 'The fall in global gross national product for this year will echo 1931-2.' The warning follows a 21% gain in his flagship Odey European Inc. fund in March, the biggest monthly increase in 11 years, according to the letter....The services industry faces defaulted customers and no revenues for months as the spread of the deadly coronavirus continues to lock-down countries across continents. The outbreak's impact was exacerbated by the oil war, Odey wrote. The money manager, who has long been a vocal critic of central banks and government policies, also turned his attention to decisions by some of Britain's biggest lenders to cancel dividend payouts. 'The idea that shareholders should be sacrificed to allow banks to make unprofitable loans to the private sector to help them through a difficult period shows just why governments have no idea how to incentivize the right behavior to get the right outcome,' Odey wrote."
Rand Paul says he has recovered from COVID-19 and is volunteering at a hospital -Kentucky.com
"Wearing a smile, a beard and a doctor's smock, Kentucky U.S. Sen Rand Paul posted on his Twitter page that he no longer has the coronavirus and is volunteering at a Bowling Green hospital. 'I appreciate all the best wishes I have received. I have been retested and I am negative.,' Paul said. 'I have started volunteering at a local hospital to assist those in my community who are in need of medical help, including coronavirus patients. Together we will overcome this!' Paul, a Bowling Green Republican and an ophthalmologist, announced March 22 that he tested positive for COVID-19. His office said then he was asymptomatic and was tested out of an abundance of caution due to his extensive travel and event schedule. Paul, 57, said he was not aware of direct contact with anyone infected. Paul attended a fundraiser for the Speed Art Museum in Louisville on March 7, which was attended by a woman who later tested positive for COVID-19....Paul was the first U.S. Senator to test positive for COVID-19. His lung was damaged after a 2017 assault by a neighbor."
4.8.20 - Gold is Cheap; Prices Could Hit $5,000
Gold last traded at $1,684 an ounce. Silver at $15.23 an ounce.
NEWS SUMMARY: Precious metal prices consolidated recent gains Wednesday on a firmer dollar. U.S. stocks rose after Bernie Sanders announced he is dropping out of the presidential race.
Gold is cheap; prices to hit $5,000 in medium-term -Economist/Kitco
"Gold prices could climb to $5,000 in a few years, this according to John Butler, author of 'The Golden Revolution.' Butler attributed this price growth to the longevity of loose monetary and fiscal policies that will come as a result of COVID-19, as well as gold's historical performance during periods of declining economic growth. 'Based on the historical pattern of the 1970s, and stagflation, and other times these sorts of things have come about, I think gold is going to rise, by orders of magnitude,' Butler told Bilal Hafeez on the Macro Hive podcast. 'I think it is perfectly realistic to see gold closer to $5,000 than where it is today in a few years' time.' On the lasting effects that the pandemic will leave on the economy, Butler said that policy reforms are here to stay...As Milton Friedman said decades ago, 'there is nothing more permanent than a temporary emergency government program.'.... Although gold has already hit historically high valuations, Butler said that simply looking at the price in nominal terms may not give the full picture. 'You have to ask yourself the question 'is the nominal price of gold really that meaningful?' I'm not sure it is, because if you look at gold deflated by the CPI, or a stock market index deflated by the CPI, or for that matter a credit index deflated by the CPI, and you start comparing gold to these other traditional stores of value, actually, gold arguably looks cheap,' he said."
Greed takes over fear in the stock market, but don't be lured into this short-lived rally -Marketwatch
"In short order, greed in the stock market has mostly taken over fear after reports of slowing new coronavirus cases in New York and Europe. Is it prudent to chase the rally? The answer is 'no' without knowing where you belong in the protection band. The best way to analyze the stock market is through multiple time frames....Charts show that 60% of the rally is driven by a short-squeeze. In a short-squeeze, short-sellers feel compelled to buy to cover. This is artificial buying, and sooner or later it exhausts itself....There is about $6 trillion worth of monetary and fiscal stimulus. In the short term that is helpful to the stock market. Are there no consequences in the long term of printing and borrowing money? Investors have said there was no warning of the coronavirus. That's untrue. On Jan. 22, The Arora Report's call was that the coronavirus could cause a drop in the market. After finding that investors continued to buy stocks, I wrote on Jan. 30 that arrogance and greed among momentum investors 'may prove to be dangerous for investors.' Other than a potential cure, the course of the stock market rally will depend on the behavior of naked investors."
Stop the panic. Don't let the coronavirus win. -USA Today
"In response to the coronavirus pandemic, democratic governments across the world have implemented unprecedented peacetime lockdowns. One California city is even using night vision equipped drones to enforce it. A city in Washington encourages citizens to snitch on those who violate the 'stay home' order. Let's pause a moment to consider the serious ramifications of what we are doing. To combat a virus, some state and local governments have ordered everyone, including perfectly healthy people, to stay home for an undefined period of time. Travel has been curtailed. Americans abroad (like me) are stuck, not knowing when we can return home. The consequences of such draconian measures are potentially devastating and irreversible. With little to no public input, we eagerly have given up our basic rights, decided that economic health is entirely subservient to public health, and radically altered how our society functions....Mild or asymptomatic cases are undercounted, artificially inflating the case-fatality rate. The best data we have comes from South Korea, which screened nearly 400,000 people. That country's case-fatality rate is 1.7%. In Germany, it's 1.3%....Second, U.S. critical care infrastructure is vast. The U.S. has 34.2 critical care (ICU) beds per 100,000 people - the highest in the world - compared to 12.5 in Italy (and 29.2 in Germany)....Third, infectious disease models, which attempt to predict how widespread and how deadly COVID-19 will be, vary considerably....But we also must consider the unintended consequences of our actions. James Bullard, the president of the Federal Reserve Bank of St. Louis, predicted that we are facing an unemployment rate of 30% and an unprecedented drop in GDP of 50%. Those numbers are worse than what we experienced during the Great Depression."
Government and Businesses Turn Attention to Eventual Reopening of $22 Trillion U.S. Economy -Wall Street Journal
"Government officials and business leaders are turning their attention to a looming challenge in the fight against the new coronavirus pandemic: Reopening a $22 trillion U.S. economy that has been shut down like never before. With some preliminary signs that infections from the virus are slowing, the whole nation is hopeful to get back to business as soon as possible. But a host of questions arise: Under what conditions should people be allowed back to work and stay-at-home orders be lifted?....A sharp reduction in new infections is a critical first step, but health experts say other steps will be needed to prevent another devastating outbreak that shuts the economy down all over again. 'It isn't like a light switch on and off,' said Anthony Fauci, a member of President Trump's task force on the pandemic. 'It's a gradual pulling back on certain of the restrictions to try and get society a bit back to normal.' Dr. Fauci said a first condition is a steep drop in the number of cases....Mr. Trump said Saturday that he is considering a second coronavirus task force focused on reopening the country. The administration's current social distancing guidelines run through April....Roughly one out of every 300 people in the country is now being tested, based on federal data, compared to about one out of every 100 people in Germany. Testing is hampered by delays and shortages that limit who can get tested. It is unlikely that the problems will be resolved by the end of April, according to one person familiar with the planning."
4.7.20 - COVID-19 Being Used in The War on Cash
Gold last traded at $1,679 an ounce. Silver at $15.38 an ounce.
NEWS SUMMARY: Precious metal prices eased Tuesday after reaching 7-year highs on safe-haven buying. U.S. stocks rose for a second day as investors grew more optimistic about a slowdown in new coronavirus cases.
Gold and silver about to undergo a major rally -CNBC
"Gold and silver each have tremendously bullish technical setups that cannot go ignored. Furthermore, there are a number of fundamental tailwinds to help bring higher prices. The Federal Reserve has cut rates to zero and unleashed a massive QE-infinity asset purchase program. They are not alone, as central banks around the world have done much of the same. On top of that, Washington passed its third fiscal bill, a historic $2.2 trillion measure. The world has known easy money for more than a decade, but not to this scale. The result of such will almost certainly bring rampant inflation later this year (bullish gold and commodities). With the global economy contracting, currencies around the world all devalued at the same time, and U.S Treasury yields hitting record lows, this reinvigorates not only safe-haven characteristics for gold but its reserve currency characteristics....If you look back to 2008, during the great financial crisis, gold lost 34% from its peak before bottoming and silver 60%. Each bottomed in October 2008 upon the Federal Reserve launching QE1 and Washington passing TARP shortly thereafter. The rallies that ensued were historic. At their heights in 2011, gold nearly tripled and silver rallied almost 500%....The late week rally has gold on the brink of a breakout, one that needs silver to join the party...This aligns a needed close above $15 in silver to not only break out of the bull-flag pattern but regain the 2001 trend line and fuel a massively bullish rally in gold, one that we would expect silver to join."
This Is What Happens After We Pass The Virus Peak -JPMorgan/Zero Hedge
"Yesterday, when giving an update on the global coronavirus infection curve, and highlighting where various nations currently reside on the curve, we said what has become conventional wisdom, namely that 'with every passing day, the world - most of which is currently on lock down - gets closer to the infection inflection point, and as the updated JP Morgan 'corona curve' chart shows, all the nations that were in the exponential rise phase (acceleration), are now moving into the stage of infection growth rate slowdown (accumulation), suggesting that a peak for most countries is now just a matter of time, at which point the number of new cases will start slowing down aggressively. This means that while US cases continue to soar, the light at the end of the tunnel is now visible."
"....The bank's MW Kim writes that the first apex is just the beginning, and then - as China is learning now as it reports the most new cases in a month. So what's really going on? First let's do the good news, which as JPM's MW Kim notes, have to do with the slowdown in global infections which grew 62% w/w to 1,275,542, while infection growth momentum has slowed compared to ~95% w/w ten days ago....Now, the not so good news: MW Kim cautions that his findings on COVID-19 so far include (1) the lack of a vaccine makes it difficult to clear the virus; (2) social distancing is an expensive strategy in terms of economic/ social cost perspective; (3) it may perhaps prove challenging to build popular acceptance of stricter social distancing for more than a month. Therefore, and this is the key part, JPMorgan...'Cannot rule out the possibility that global infection curves propagate secondary waves, shaped similar to seismic aftershocks until a vaccine is broadly available.'"
COVID-19 Is Being Used To Scare You Away From Using Cash -Zero Hedge
"Cash has been the target of the banking and financial elites for years. Now, the coronavirus pandemic is being used to frighten the masses into accepting a cashless society. That would mean the death of what's left of our free society. CBS News, CNN, and other mainstream outlets are fearmongering again. Alarmism is nothing new in the media world, but this time, it's not about triggering panic buying or even pushing a political agenda. The war on cash is about imposing a new meta-narrative. As economist Joseph Salerno explains, the cashless society forces all payments to be made through the financial system. It doesn't end with monopoly control over transactions, though. Being bound to computers for transactions kicks the door wide open to hardcore surveillance of personal activity and location data. Being eternally on the grid means relentless taxation and negative interest rates, which the Federal Reserve is already gearing up for. None of this bothers the well-heeled boosters of a cashless society or their lackeys in the media. They want Americans reading about the threat of coronavirus cooties on their cash, which is absurd. Germs, of course, can loiter all over credit and debit cards, smartphones, ATMs, and every other cash alternative device."
Passover, Easter and Ramadan Become Virtual Holidays of Renewal -Bloomberg
"As Jews, Muslims and Christians enter one of the holiest times of the year, with Easter, Ramadan and Passover all celebrated this month, leaders of these religions with ancient roots find themselves giving thanks to the internet. With roughly half the world locked down, keeping the holidays communal will be a struggle....With mosques in most of the world adhering to bans on large gatherings, even conservative imams are finding ways to stream prayers and sermons, she said. At the epicenter of the disease in the U.S., viewers of Sunday masses on the website of the Archdiocese of New York went from 600 at the start of the epidemic to 26,000. More are expected on Easter, a spokesman said....Religious leaders say the pandemic, however painfully, has breathed fresh meaning into these holidays, all rooted in hardship and renewal. 'The coronavirus reminds us that man's greatest enemy is death,' said Robert Jeffress, one of the U.S.'s most influential evangelical pastors as head of the First Baptist Church in Dallas. 'And next Sunday I will be reminding our congregation of the words of Jesus in John 11:25: 'I am the resurrection and the life. He who believes in me, though he dies, will live again.'"
4.6.20 - The High Cost of Low Interest Rates -WSJ
Gold last traded at $1,703 an ounce. Silver at $15.24 an ounce.
NEWS SUMMARY: Precious metal prices rose sharply Monday on safe haven buying and a flat dollar. U.S. stocks opened higher following a sharp sell-off last week amid signs of stabilization in global coronavirus hospital cases.
Gold rises over 1% as coronavirus hits global economies -CNBC
"Gold prices jumped 1.5% to a more than three-week high on Monday as worries over a global economic slowdown caused by the coronavirus pandemic drove investors to the safe-haven metal. 'The virus's impact on the global economy and the unprecedented amount of stimulus going through the veins of the financial system should keep supporting gold,' OANDA analyst Craig Erlam said. 'Gold seems to have its eye on $1,700 per ounce and I wouldn't be surprised to see it push higher.' The pandemic has infected more than a million people, killed over 68,000 and prompted countries to extend lockdowns to curb its spread, paralyzing large swathes of the global economy....'From a long-term standpoint, gold will still remain the preferred asset as the environment of low interest rates and virus-induced global slowdown would support a prolonged rally,' said Sugandha Sachdeva, vice-president, metals, energy and currency research at Religare Broking Ltd."
The High Cost of Low Interest Rates -Grant/Wall Street Journal
"It took a viral invasion to unmask the weakness of American finance. Distortion in the cost of credit is the not-so-remote cause of the raging fires at which the Federal Reserve continues to train its gushing liquidity hoses. But the firemen are also the arsonists. It was the Fed's suppression of borrowing costs, and its predictable willingness to cut short Wall Street's occasional selling squalls, that compromised the U.S. economy's financial integrity....Perhaps never before has corporate America carried more low-grade debt in relation to its earning power than it does today. And rarely have equity valuations topped the ones quoted only weeks ago. Interest rates are the critical prices that measure investment risk and set the present value of estimated future cash flows. The lower the rates, other things being equal, the higher the prices of stocks, bonds and real estate - and the greater the risk of holding those richly priced assets....The Fed commandeered investment values into the government's service. It seeded bull markets in the public interest. But investment valuations don't exist to serve a public-policy agenda. Their purpose is to allocate capital. Distort those values and you waste not only money but also time - human heartbeats....In a bubble, performance is the name of the investment game. Over the past 10 years, skeptics of our debt-financed prosperity have had to fall in line....Negative nominal bond yields are a 4,000-year first, according to Sidney Homer's 'A History of Interest Rates'...Deceived by ultralow interest rates, Americans borrow and lend in the kind of false economy that candidate Donald Trump properly condemned in 2016. Covid-19 will sooner or later beat a retreat. For the sake of honest prices and true values, it would be well if the central bankers did the same."
Forget about returning to jobs as usual after coronavirus -New York Post
"In the last two weeks, new applications for unemployment benefits have reached an incredible 9.9 million. That's 6 percent of the entire workforce. That's about as many job losses as there were in the entire 2008-2009 recession....But more than the immediate pain, this crisis is likely to reshape the economy permanently. In good times, when business is profitable and getting more so, many bosses avoid making hard choices. Inefficiencies are ignored, new labor-saving technology is not installed, under-performing employees are tolerated. But when the bad times inevitably come, suddenly executives have no choice but to run the tightest ships possible and labor costs are usually one of the easiest variables to control. And those lost jobs don't come right back after the economy once again turns up....Some jobs are just not going to come back. Most restaurants in the country are closed right now, at least for in-house dining. A fair number in all likelihood will never reopen....We live in economically revolutionary times with the ongoing digitalization of the world. Some of the expediencies that have been resorted to in the pandemic, such as increased working from home and teleconferencing, may well turn out to be simply a better way to do things. That will have consequences. If, for instance, a significant portion of the working population - and their bosses, of course - find they can work just as well from home, they are likely to increase doing so. That, in the long run, will mean fewer jobs for transportation workers as the volume of commuters declines....On the plus side, however, Americans today are far richer than they were, say, in the 1930s, and a far higher percentage of families have substantial financial assets and credit lines to see them through the crisis."
An even bigger war: The one against expanding government -Ponte/WND
"Our expanding battle against the COVID-19 coronavirus conceals a bigger war: the imperial assault by politicians to wrest power from the people and permanently expand the government. A major weapon used against us in this war, as syndicated radio talk-show hosts Armstrong and Getty mentioned days ago, is what psychologists and brainwashers call an 'availability cascade,' a self-reinforcing cycle of repeated claims designed to alter society's collective beliefs by replacing skepticism with irrational certitude and emotional acquiescence. This technique to control us by stampeding the 'herd' mentality in our heads with endless repetition (i.e., 'availability') has been used by ideologues to create conformity of thought on such issues as global warming and gun control. One sign that propagandists are attacking your brain with an 'availability cascade' is the pretense that their position is supported by 'the experts' and/or by the overwhelming majority of your fellow citizens. Their position is also depicted as a dire emergency - something that you should react to with fear, even panic....Politicians have long invoked or created emergencies to increase their power....'The people never give up their liberties, but under some delusion,' said British statesman Edmund Burke. 'The whole aim of practical politics,' wrote journalist H.L. Mencken, 'is to keep the populace alarmed and hence clamorous to be led to safety … by menacing it with an endless series of hobgoblins. …' 'You never want a serious crisis to go to waste,' said Rahm Emanuel, the chief of staff for President Barack Obama, in 2008. 'Crisis provides the opportunity for us to do things that you could not do before.'....Government may have valid reasons for martial law powers to fight the coronavirus, or to free jailed violent criminals, or to close gun stores and churches while keeping liquor and marijuana stores open as 'essential' services, or for tripling government spending. But power-grabbing government policies that could become permanent are not being rationally debated; they are simply imposed by authority and justified by fear of a killer disease. Will freedom and limited government ever return after this plague?"
4.3.20 - Gold Glitters as Crisis Intensifies
Gold last traded at $1,646 an ounce. Silver at $14.49 an ounce.
NEWS SUMMARY: Precious metal prices rose Friday on safe-haven buying despite a firmer dollar. U.S. stocks fell after March job data was the worst since the last financial crisis.
Gold Glitters as Coronavirus Crisis Intensifies -Yahoo Finance
"The aggravation of coronavirus pandemic with each passing day has left investors scurrying for safe-haven assets as they remain apprehensive regarding the recovery of global economic growth and its consequent impact on stock markets. This, in turn, has triggered a demand for gold, which is considered as a key investment option during times of financial turbulence....Buying pressure on gold is likely to remain robust with investors focusing on precious metals as a store of wealth and hedge against market turmoil at least for the next few months. The present scenario of gold price soaring despite a surge in U.S. dollar index has left several economists and financial experts perplexed. Usually, a strong U.S. dollar weakens demand for other dollar-denominated gold bullion. However, the northbound movement of both safe-haven assets highlights the impact of coronavirus on investor confidence."
When Bulls Are This Over-Anxious To Catch The Rocketship Higher, The Bottom's Not Close -Smith/Zero Hedge
"The classic Bull Market reason to get extremely bullish is, yes, bearish sentiment: sentiment is terrible, and bearish sentiment is the surefire marker of a stock market bottom. The more bearish the sentiment, the more reasons to get bullish and start buying with abandon....Since only those of us with gray hair have actually lived through a real Bear Market, younger participants cannot imagine sentiment is bearish because conditions are bearish. The last real Bear Market was in the 1970s and early 1980s, about years ago. By 'real' I mean deep, enduring and pervasive. Each of the recessions / Bear Markets since 1982 have been relatively brief....A real Bear Market is different. It's systemic, i.e. it can't be reversed with 'the Fed has our back' tricks; it's pervasive, i.e. it affects every sector of the economy, and because it's systemic, it's enduring - it doesn't end in a quarter or two, or even a year or two. Real Bear Markets end not when sentiment gets extremely bearish, but when all the mal-investments, inefficiencies, excesses and institutionalized skims/scams are squeezed out of the system....An abundance of Bulls over-anxious to 'buy the dip' to catch the rocketship higher is not evidence of a bottom, it's evidence of a top. At the bottoms of real Bear Markets, few are anxious to buy the dip because sentiment is bearish....Everyone with any position in today's market will be able to say they lived through a real Bear Market. The trick is to survive the bullish echo chamber and have some capital left to deploy when all the bulls so anxious to buy the dip will have vanished."
March Job Losses Signal Bigger Collapse -Wall Street Journal
"Employers shed 701,000 jobs in March, the start of a labor-market collapse that could push the U.S. unemployment rate to record highs. The unemployment rate for March rose to 4.4% from 3.5% in February. It was the largest one-month increase in the rate since January 1975. The data doesn't yet fully reflect the millions of unemployment-insurance claims individuals filed in the last two weeks of March due to the coronavirus pandemic....The near shutdown of swaths of the U.S. economy due to the new coronavirus pandemic - from corner restaurants to manufacturing plants to international tourism - is inflicting damage on the labor market that economists say dwarfs the most significant economic downturns of the post-World War II era. And it is playing out in a matter of weeks, rather than years....The nonpartisan Congressional Budget Office said Thursday that the unemployment rate would exceed 10% in the second quarter....'There's no comparison to this shock,' said Gregory Daco, Oxford's chief U.S. economist. 'The sudden drop in economic activity is like what you'd see in an area after a natural disaster or a terrorist attack, but it's occurring across the entire country.'....Beth Ann Bovino, S&P Global's chief U.S. economist, projects 17 million jobs will be shed in the coming months and the unemployment rate will touch 13.5%. She expects it will take the economy until late 2022 to recover those lost jobs, and, given population growth, the unemployment rate won't return to recent lows until 2023."
COVID-19: A Time to Make Substantive Life Changes -Conley/Next Avenue
"What if the world is meant to take a 'gap year' as a result of the coronavirus?...First off, let's acknowledge that many of us are now working even harder from home, whether it's due to the industry we're in or the difficult fate our companies are facing. But many others are feeling idle and confused. If you're one of them, how could you use this global timeout as an opportunity to make some substantive life changes? During this unusual time, some of us may be getting an early glimpse into what our retirement might look like....Here are three questions that might help you address these issues during the pandemic, and bring back a deeper sense of meaning in your life: 1. What's something that gives me a sense of purpose? Is it a political or social issue, your children's or grandchildren's education, your thriving religious community, art, service, entrepreneurship?....2. How can I connect with people even though I can't see them in person? Make a practice of writing a daily list of three people you care about but haven't talked with in a while (from your past and present). Reach out to them by email, phone or video call. Re-establish a connection....3. Who can be my accountability partner to help create more structure in my life? Do you have a friend who, like you, also wants to lose 10 pounds or cut down on alcohol or break the habit of taking sleeping pills at night? Call this crisis what you will - a gap year, unexpected retirement or a momentary pause. It may also be an opportunity in disguise."
4.2.20 - China Asserts Global Leadership Claim
Gold last traded at $1,641 an ounce. Silver at $14.62 an ounce.
NEWS SUMMARY: Precious metal prices rose sharply Thursday following record high U.S. jobless data. U.S. stocks shrugged off downbeat employment while focusing on expectations Saudi Arabia and Russia will ease oil market pressures.
Investors should have up to 10% in this 'hedge against the unexpected' says 'Godfather' of gold -CNBC
"George Milling-Stanley has sometimes been referred to as the 'Godfather' of the gold business. While at the World Gold Council, he was among a small group that helped create the SPDR Gold Trust in 2004, now the world's largest gold exchange-traded fund with over $50 billion in assets. He is now chief gold strategist at State Street Global Advisors. CNBC: What do you think will happen with gold prices in the next few months? Milling-Stanley: I am expecting gold to continue to make strides. Gold jewelry demand may drop, but I am expecting a large increase in investment. This is what happened in 2008: Jewelry demand dropped but gold investment increased. If you look at flows into GLD, we saw significant inflows - just shy of $1 billion in the last week. We have had $3.8 billion in inflows year to date. Coronavirus is going to continue to be a concern. Brexit is still an issue. There are problems in the Korean peninsula. Investors have shifted from, 'Is there going to be a bear market' to 'How long will the bear market last?' All of this is positive for gold. CNBC: The Federal Reserve is again expanding its quantitative easing program. Does this have any impact on gold pricing? Milling-Stanley: It likely will. When the Fed began its QE program in 2008, the Fed balance sheet went up. Gold went up 8% a year on average during that period from December 2008 to October 2014. CNBC: In the first few weeks of March, gold dropped about 15% along with the stock market. What was going on there? Milling-Stanley: Gold did what it was supposed to do in this sort of environment. It came to the aid of investors when other investments were going south. In order to meet margin calls, gold was there to be sold, and it was indeed sold. This happened in 2009 and in 2002. CNBC: And yet, gold bounced back again in the second half of March. Milling-Stanley Yes. Gold was sold, and then having done its job investors tend to buy it back again, so gold tends to recover. CNBC: What part of an investment portfolio should gold be? Milling-Stanley: Our research indicates anywhere from 2% to 10%, depending on your risk tolerance and liquidity needs."
China Asserts Claim to Global Leadership -Wall Street Journal
"China, the country where the virus first appeared and claimed its first several thousand lives, is now using the global spread of the disease to bolster an increasing vocal, assertive bid for global leadership that is exacerbating a yearslong conflict with the U.S. Combined with deliveries of essential goods, this public-relations push has enabled China to stake a claim to a void on the global stage left by an inward-looking America - while also helping Chinese leaders distract attention at home from criticism they mishandled the early stages of the outbreak. Over a two-week period in March, Chinese government agencies, companies and charities donated more than 26 million face masks, 2.3 million testing kits and other supplies to 89 countries, according to a review of state media reports and government and company statements....Pushing beyond material aid, China's government has sent experts and teleconferenced guidance to medical staff in countries across Europe and Asia, in an international role similar to the one the U.S. played during the 2014 Ebola epidemic...'The United States is not offering leadership. Europe doesn't exist….For the first time in decades, West is lost,' said Francesco Sisci, an Italian Sinologist and columnist for the Catholic newspaper Settimana News. 'In this vacuum, China's offering an example. They are there, and they are helpful.'"
Fed Takes on Role of World's Central Bank by Pumping Out Dollars -Yahoo Finance
"The Federal Reserve is acting as central banker to the world by seeking to provide the global financial system with the dollar liquidity it needs to avoid seizing up. In its latest measure to combat the economic fallout from the coronarvirus pandemic, the Fed said Tuesday it was establishing a temporary repurchase agreement facility to allow foreign central banks to swap any Treasury securities they hold for cash. That's yet another step beyond the actions it took in the 2008 financial crisis....Emerging-market borrowers are especially at risk. Encouraged by low U.S. interest rates, they've loaded up on a dollar-denominated debt in recent years. They now face a squeeze as their exports plummet due to economic shutdowns worldwide to combat the coronavirus contagion. A significantly stronger dollar can also hurt the U.S. by tightening financial conditions and making American exports more expensive on world markets....The Fed is having to take on the mantle of world central banker because of the dollar's dominant role in the world economy and the critical importance of the Treasury debt market to the global financial system."
Feed the soul: In chaotic times, gardening becomes therapy -Associated Press
"As spring's arrival in the Northern Hemisphere coincides with government stay-at-home orders, the itch to get outside has turned backyard gardens into a getaway for the mind in chaotic times. Gardeners who already know that working with soil is a way to connect with nature say it helps take away their worries, at least temporarily. 'I love to see things grow,' Lindsay Waldrop said. 'It's incredibly therapeutic.' Now more than ever. Waldrop, a resident of Anaheim, California, has an anxiety disorder. Exercise is supposed to help, but her new job as a college biology professor had prevented her from getting into a routine. Her grandfather, who introduced her to gardening by showing her how to plant seeds, died about a year ago. 'Sometimes I just like to sit and dig holes in the quiet with my own thoughts,' she said. 'Outside, it takes my mind off. It gives something for my hands to do. It gives you a separate problem to think about than whatever else is going on. It gets you off of social media.'"
4.1.20 - Recession: A Marathon, Not a Sprint
Gold last traded at $1,601 an ounce. Silver at $14.03 an ounce.
NEWS SUMMARY: Precious metal prices rose Wednesday on safe-haven buying despite a firmer dollar. U.S. stocks fell after President Trump issued a stark new warning on the spread of the coronavirus in the U.S.
Gold price heading to new highs, beating copper, oil and equities -Bloomberg Intelligence/Kitco
"Gold remains the commodity to own, and investors should expect to see prices hit new all-time highs driven by unprecedented monetary stimulus and deficit spending, according to one market analyst. In a report Tuesday, Mike McGlone, senior market analyst at Bloomberg Intelligence, said that the price action in the gold market continues to resemble what happened during the 2008 financial crisis. Although gold prices suffered from a more than 20% decline in the midst of the crisis, prices quickly recovered and within three years reached an all-time high at $1,900 an ounce. 'With base rates at zero or negative, and the Federal Reserve embarking on seemingly unlimited monetary stimulus akin to 2008, we see gold extending its $1,900-an-ounce peak as the next in a stair-step recovery process,' McGlone said in the report. 'If following the script from the 2008-09 financial crisis, the term 'recovery' portends new highs for gold. About $1,000 was the initial threshold then. In today's climate, it's comparable to $1,900.'....McGlone said that the yellow metal will be the asset to own as the spreading coronavirus pushes the global economy into a sharp recession. He added that the precious metal will outperform both oil and base metals....U.S. equity market is seeing its worst quarterly performance since 2008 but McGlone said that this could be just the start."
Bear Market/Recession: A Marathon, Not A Sprint -Calhoun/Alhambra Partners
"Stocks rose last week, a breathtaking, nearly 20% run off the recent lows before a pullback Friday trimmed the gain for the week to about 11%...This is what bear market rallies look like. They come out of nowhere, they run much further than anyone thinks they should and, more than anything, they engender hope; hope that the bear is finally over...False dawns are the norm, not the exception. In the last two bear markets, there were numerous, breathtaking stock market rallies that ultimately proved to be nothing more than selling opportunities before new lows. In the 2001 - 2002 bear market, there were three rallies of more than 15% and two others that ran to nearly 10%. The S&P 500 didn't make its final bear market low until October 9th, 2002 at 776.76...That bear market spanned over 2 years and by the end, nobody wanted stocks. In the 2008/09 bear market there were two big rallies similar to last week's. We didn't make the final low until March 9th, 2009. That bear market was fairly short compared to the 2001/2 bear and I think the memory of that one is influencing how investors are thinking of this one...I think it makes a lot more sense to start thinking in terms of the 2001/2 bear. This is not going to end quickly and it is going to be painful....Meanwhile, the economy continues to deteriorate at a rapid pace. One thing we should all learn from this is how interconnected our economy is. Thinking you can shut it down and restart it without significant, lasting damage is fanciful....In the last two recessions, the S&P 500 fell about 50% at the lows. This recession will be worse than either of those. Why wouldn't we expect stocks to fall at least that far again?...Right now, the only things in an uptrend are Treasuries and gold....I expect this recession and bear market to be a marathon, not a sprint. Last week's rally was nice but unlikely to signal anything other than noise."
An FDA Breakthrough on Treatment -Editors/Wall Street Journal
"The Food and Drug Administration on Sunday green-lighted two malaria medicines that have shown some promise treating the novel coronavirus, and the emergency approvals couldn't come soon enough. Expanding their use could bring quicker relief to patients and hospitals while allowing scientists to better assess their efficacy. The malaria drugs hydroxychloroquine (HC) and chloroquine have been around for more than five decades, so their safety is well documented. New evidence suggests that they could also help fight the novel coronavirus. Hydroxychloroquine nowadays is often prescribed for the autoimmune conditions lupus and rheumatoid arthritis that result from the body's immune system attacking its own cells. Scientists have also documented an overreactive immune response in severely ill coronavirus patients. Notably, a study in France of 80 coronavirus patients given HC and azithromycin, an antibiotic for upper respiratory infections, documented 'a clinical improvement in all but one 86 year-old patient who died, and one 74 year-old patient still in intensive care unit.' Doctors have also reported anecdotal evidence of the malaria drugs' efficacy. More study is needed, and a clinical trial of the two drugs involving 1,100 patients started last week in New York. But the FDA's emergency authorization will let more doctors prescribe the drug outside of clinical trials....The Department of Health and Human Services reported Sunday that Novartis has donated 30 million doses of HC, and Bayer has contributed one million doses of chloroquine to the federal government, which can distribute the drugs to areas with the highest need."
Most Americans Say Coronavirus Outbreak Has Impacted Their Lives -Pew Social Trends
"As the number of confirmed COVID-19 cases continues to rise and schools, workplaces and public gathering spaces across the United States remain closed, a new Pew Research Center survey finds that the coronavirus outbreak is having profound impacts on the personal lives of Americans in a variety of ways. Nearly nine-in-ten U.S. adults say their life has changed at least a little as a result of the COVID-19 outbreak, including 44% who say their life has changed in a major way....How are people adapting their behavior in light of the outbreak? Four-in-ten working-age adults ages 18 to 64 report having worked from home because of coronavirus concerns - a figure that rises to a majority among working-age adults with college degrees and upper-income earners. Still, despite current circumstances, about two-thirds of adults with children under 12 at home say it's been at least somewhat easy for them to handle child care responsibilities. The virus also has impacted Americans' religious behaviors. More than half of all U.S. adults (55%) say they have prayed for an end to the spread of coronavirus. Large majorities of Americans who pray daily (86%) and of U.S. Christians (73%) have taken to prayer during the outbreak - but so have some who say they seldom or never pray and people who say they do not belong to any religion (15% and 24%, respectively)....Four-in-ten regular worshippers appear to have replaced in-person attendance with virtual worship (saying that they have been attending less often but watching online instead)."