Tag Archives: Covid-19 consequences

Save Yourself: Stop Believing in Lockdown, by Stacey Rudin

Posted on August 25, 2020 | 1 comment

Lockdowns have been not only unnecessary and ineffective, they’ve been counterproductive. From Stacey Rudin at aier.org:

Storied minds have argued that a failure to critically examine our beliefs makes us culpable for adverse outcomes. Beliefs lead to actions, which impact other people.

As Voltaire wrote during the Enlightenment — when society still had time away from the screen to reflect on philosophy, morality, and fundamental truth — “those who can make you believe absurdities, can make you commit atrocities.”

This has never been more true than in the age of social media, when information and opinions constantly bombard us from all sides, isolating us from our own thoughts and values. We have a moral duty to critically examine our beliefs — especially our belief in “lockdown,” the most oppressive and universally destructive public policy implemented in our lifetimes.

Is it the least-restrictive means available to minimize casualties in this pandemic?

Our belief in it was formed when we felt legitimate fear — this can lead to irrationality — so we really cannot answer this question in good conscience unless and until we take the time to conduct a proper, honest examination with the benefit of hindsight.

Any number of atrocities can occur when human beings act on unfounded, unexamined beliefs.

Consider the example of the shipowner in William Kingdon Clifford’s 1876 essay, “The Ethics of Belief.” Troubled by the condition of his aging ship, which others have suggested is not well-built and is in need of repairs, he eventually pacifies himself with these comforting thoughts: “She had gone safely through so many voyages and weathered so many storms that it was idle to suppose she would not come home from this trip also.” The shipowner develops a sincere conviction that she will not sink, and acts on his belief.

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The Most Dangerous Period for Your Savings and Individual Freedom We’ve Ever Seen, by Chris MacIntosh

Posted on August 24, 2020 | 1 comment

Will capital and opportunities shift to the East from the West? From Chris MacIntosh at internationalman.com:

Doug Casey’s Note: There aren’t too many newsletters that I can recommend wholeheartedly. Chris MacIntosh’s is one of the few. It covers the entire investment waterfront, it’s thoughtful and well-written.

Let me add I’m completely on the same page with Chris and his views. I urge you to read what he has to say.

International Man: I’d like to introduce Chris MacIntosh.

After working for many top-tier investment banks, Chris left the corporate world. He has since built and sold multiple million-dollar businesses, built a VC firm allocating $35m into early-stage ventures, and become a full-time trader.

He now manages money for clients of Glenorchy Capital; a macro focused hedge fund. Chris is the founder of Capitalist Exploits, with its flagship investment subscription letter called Insider.

Alright, let’s get into our discussion.

As countries destroy their national currencies, middle- and lower-class individuals will disproportionally be affected.

Are we seeing global destruction of private savings? What are the implications?

Chris MacIntosh: There’s a lot to unpack there.

What we’re seeing is the wholesale destruction of the middle class, certainly in Western democracies.

I think it’s by design.

We’re also seeing a wave of neo-Marxism taking place across the Western world, and they see it as an opportunity.

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Posted in Banking, Business, Capitalism, Collapse, Currencies, Debt, Economics, Economy, Government

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Bankruptcies Rise Despite Trillions Of Liquidity, by Daniel Lacalle

Posted on August 24, 2020 | 1 comment

There is illiquidity and there is insolvency, and gushers of new debt-based liquidity won’t make the insolvent solvent. From Daniel Lacalle at dlacalle.com:

Misguided lockdowns have destroyed the global economy and the impact is likely to last for years. The fallacy of the “lives or the economy” argument is evident now that we see that countries like Taiwan, South Korea, Austria, Sweden or Holland have been able to preserve the business fabric and the economy while doing a much better job managing the pandemic than countries with severe lockdowns.

One of the most alarming facts about this crisis is the pace at which bankruptcies are rising. Despite an $11 trillion liquidity injection and government aid in 2020, stocks and bonds at all-time highs and sovereign as well as corporate yields at all-time lows, companies are going bust at the fastest pace since the Great Depression. Why? Because a solvency crisis cannot be disguised by liquidity.

Trillions of liquidity are giving investors and governments a false sense of security because yields are low and valuations are high, but it is a mirage driven by central bank purchases that cannot disguise how quickly companies are entering into long-term solvency issues. This is important because soaring bankruptcies and the rise in zombie companies means less employment, less investment and lower growth in the future.

Liquidity only disguises risk, it does not resolve solvency issues driven by collapsing cash flows while costs remain elevated.

According to the FT, large US corporate bankruptcy filings are now running at a record pace and are set to surpass levels reached during the financial crisis in 2009. As of August 17, a record 45 companies each with assets of more than $1bn have filed for Chapter 11 bankruptcy. In Germany, about 500,000 companies are considered insolvent and have been zombified by a pointless “insolvency law” that simply extends the pain of businesses that are technically bankrupt. In Spain, the Bank Of Spain alerted that 25% of all companies are on the verge of closing due to insolvency. According to Moody’s estimates, more than 10% of businesses in the leading economies are in severe financial stress, many in technical bankruptcy.

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Lockdown Evil, by Tom Woods

Posted on August 19, 2020 | Leave a comment

The carnage from lockdowns will be far worse than the coronavirus. From Tom Woods at lewrockwell.com:

By now we’ve all gotten the message: you’re selfish if you’d like to do the kinds of things that once gave your life meaning.

For these people, life is about nothing but the avoidance of death.

Virtually everything you’ve looked forward to has been canceled, and nobody will tell you when you can have those things back. “When we have a vaccine,” comes the raving lunatic’s answer.

Nobody was giving you that answer when they were pushing “15 days to flatten the curve.” They didn’t dare.

Instead, they kept us in our homes for those 15 days, and then 15 days after that, and 15 days after that. Each time they pushed the date back we grew more demoralized, more resigned to a barren life without “large gatherings” – i.e., everything that makes life fun – and “virtual” events over Zoom.

Oh, and no hugs, no weddings, 10 people at your father’s funeral, and a long list of other grotesque demands.

What metrics were they using to decide when we’d be allowed back out again, when our businesses could open (and when they could operate at a level that made profit even a remote possibility), and when those life-giving pleasures that bring us meaning and fulfillment could be resumed? Who knows?

All we heard was: everything is canceled.

Maybe you can have it in 2021.

Maybe you can have it when there’s a vaccine – as if there’s a guarantee of that.

Well, a terrifying statistic came out last week showing the grim – if entirely predictable – effects all this inhuman regimentation has been having on the young, particularly those between 18 and 24.

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Is Covid Coming For Your Job? by Adam Taggart

Posted on August 18, 2020 | Leave a comment

The flip side of coronavirus overreaction: an economy headed down the drain. From Adam Taggart at peakprosperity.com:

Laid off or fear you could be? Then read this.

Because despite the “Everything is Awesome!” mirage the financial markets are desperate to project, the real economy — you know, where people actually live their lives — is telling us a far darker story.

Tens of millions of US workers have lost their jobs since covid-19 arrived on America’s shores. Over 28 million people right now are currently filing to receive state & federal unemployment benefits:

Continued Claims chart

And despite extraordinary measures to aid these impacted households, many are slipping into hardship as the prospects only grow dimmer.

The $2.2 trillion CARES Act created the Federal Pandemic Unemployment Compensation program which added an additional $600 per week to those receiving unemployment benefits. It also sent a tax credit check of up to $1,200 ($2,400 for joint filers) to households making under a certain income threshold.

But the extra $600 payments have now expired, and Congress is deadlocked on what will follow. The current proposal is to re-start the extra benefit payment at the reduced sum of $400/week, with $300 paid out of the federal government’s Disaster Relief Fund and the rest funded by the individual states. Another $1,200 payment seems likely, as well.

This plan has it challenges, though. At $300/week, the Disaster Relief Fund will be drained after 5 weeks. And many states are claiming they can’t afford to foot the $100/week bill they’re being asked to.

So it’s little wonder, with tens of millions of jobs lost and over 3,500 businesses declaring Chapter 11 bankruptcy so far this year, Americans are increasingly worried for the future:

POLL-Three of ten Americans laid off in coronavirus crisis worried about food, shelter (Reuters)

Three of 10 Americans who lost work during the coronavirus pandemic said they may have trouble paying for food or housing after a $600-per-week enhanced unemployment payment expired last month, according to a Reuters/Ipsos poll released on Wednesday(…)

(…) Three out of 10 people surveyed by Reuters/Ipsos reported that they will have “a very difficult time meeting basic needs,” which includes paying for rent or buying groceries. Half said they are under some stress “but we will be able to meet our basic needs.”

And it’s only going to get harder for these folks from here.

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The End Of The Beginning, by the Zman

Posted on August 11, 2020 | Leave a comment

Sports has often been called a microcosm of society, but that may never be more true than now. From the Zman at theburningplatform.com:

For months now, the more cynical have suggested the lock downs will continue into the fall, as the hysteria has become something of a religion. The facts on the ground are useful to the panic party in so far as they can be used to support the idea that this plague is a curse sent from nature because of Trump. They hope the self-inflicted suffering will purge the lands of orange come November. Word now comes that they plan to cancel college footballthis week.

There’s no public health reason for cancelling college sports this fall or for keeping the kids of campus, which many colleges are doing. Many colleges will be on-line only this fall, meaning it will be a full year of virtual learning for their students. It was not that long ago when these very same colleges said on-line learning was terrible. Students needed personal interaction with their teachers and fellow students. Like so much that comes from the Left, that was true only while it was useful.

As far as college football, the plan was to minimize attendance at the games and make sure the players were tested on a daily basis. The only thing missing from the regime was daily dips into vats of hand sanitizer. Despite it all, the people who run big time college sports have been bullied into shutting down. This should put to rest that the people behind this stuff are motivated by money or power. They are tossing away billions and their grip on millions of people’s attention.

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Deceit and Demagoguery in Montgomery County, Maryland, by James Bovard

Posted on August 9, 2020 | Leave a comment

Covid-19 tyranny has given many very tiny little people enormous power. The results have been predictable. From James Bovard at aier.org:

cross the nation, politicians and bureaucrats have invoked the COVID pandemic to seize dictatorial power to ban activities they disapprove. One of the most brazen examples recently occurred in super-lefty Montgomery County (MoCo), Maryland, where local health czar Travis Gayles announced last Friday that he would impose a $5,000 fine and up to a year in prison on private school teachers that teach students in person between now and October 1.

New COVID cases have plummeted in MoCo and are at very low levels. Gayles justified banning private schools in part because of rises in COVID transmission rates elsewhere in Maryland, the District of Columbia, and Virginia. Apparently, as long as there are any positive COVID test results within 300 miles, letting teachers teach is too risky.

Maryland as a whole has been through the Covid wave and now deaths have plummeted.

On Monday, Gov. Larry Hogan overturned Gayles’ decree, ruling that the “blanket closure mandate imposed by Montgomery County was overly broad and inconsistent with the powers intended to be delegated to the county health officer….As long as schools develop safe and detailed plans that follow CDC and state guidelines, they should be empowered to do what’s best for their community.” Hogan declared, “This is a decision for schools and parents, not politicians.”

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Things Going By, by James Howard Kunstler

Posted on August 7, 2020 | Leave a comment

Think smaller as the present way of life fails. From James Howard Kunstler at kunstler.com:

If this (first?) summer of Covid-19 has revealed anything about the current version of civilization, it’s the profound exhaustion of a culture reduced to going through the motions of its once-vital activities. A lot of things that we hope will come back are probably gone forever in the form we knew them, though they will eventually return in another configuration, reduced in scale, but perhaps finer in quality.

I miss baseball horribly, and its sad, half-assed attempt to present a rump season with no live bodies in the seats only amplifies the loss. But then, I haven’t gone to a stadium in twenty years, and I certainly won’t pay a hundred bucks or more to sit in Fenway Park. I used to go to night games there all the time when I was a starving bohemian writing for the Boston hippie newspapers back in 1972. You could get a decent field-level seat behind first base for five bucks. When I was a kid in Manhattan in 1960, a bleacher seat in the old Yankee Stadium was a quarter (plus 30 cents round-trip on the IRT subway).

They weren’t writing $100-million-plus player contracts until fairly recently, either, and of course that’s been a symptom of pro sports’ slide into fatal decadence. If baseball does try to stage a full season in 2021 or 2022, they will not be selling many hundred-dollar seats to an economically demolished middle-class. The teams will be functionally bankrupt by then and if they survive restructuring, there won’t be many million-dollar players. Maybe none. Carl Furillo, the veteran right-fielder for the 1955 World Series champion Brooklyn Dodgers, used to work construction in the off-season. He was on the crew that built New York’s Verrazano Narrows Bridge. Imagine Mike Trout hanging sheet-rock (if sheet-rock even exists as a product a few years from now).

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It’s Now Virtually Impossible To Get A Bank Loan As Lending Standards Soar, by Tyler Durden

Posted on August 4, 2020 | Leave a comment

And now a report from a sector that’s received relatively little coverage during the 24/7 coronavirus coverage: business and the economy. From Tyler Durden at zerohedge.com:

One quarter ago we pointed out something concerning: shortly after JPMorgan reported that its loan loss provision surged five fold to over $8.2 billion for the first quarter, the biggest quarterly increase since the financial crisis, in preparation for the biggest wave of commercial loan defaults since the financial crisis (a number which in the latest quarter surged to $10.5 billion along with all other banks’ loan loss provisions)…

… the bank hinted that things are about to get much worse when it first halted all non-Paycheck Protection Program based loan issuance for the foreseeable future (i.e., all non-government guaranteed loans) because as we said “the only reason why JPMorgan would “temporarily suspend” all non-government backstopped loans such as PPP, is if the bank expects a default tsunami to hit coupled with a full-blown depression that wipes out the value of any and all assets pledged to collateralize the loans.”

Shortly after, the bank also said it would raise its mortgage standards, stating that customers applying for a new mortgage will need a credit score of at least 700, and will be required to make a down payment equal to 20% of the home’s value, a dramatic tightening since the typical minimum requirement for a conventional mortgage is a 620 FICO score and as little as 5% down. Reuters echoed our gloomy take, stating that “the change highlights how banks are quickly shifting gears to respond to the darkening U.S. economic outlook and stress in the housing market, after measures to contain the virus put 16 million people out of work and plunged the country into recession.”

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Politics, Not Science, Keeping Schools Closed, by Yinon Weiss

Posted on August 2, 2020 | Leave a comment

The schools are being kept closed for all sorts of reasons that have nothing to do with health. From Yinon Weiss at realclearpolitics.com:

Politicians speak about following the science to set COVID-19 policy, but their decisions are more about political objectives than they are about medical efficacy. Why else did California Gov. Gavin Newsom shut down retail businesses in March when the state had under 300 cases per day but allow them to be open in July when the state clocked in at over 10,000 cases per day?

Why else would Kentucky Gov. Andy Beshear allow liquor stores to stay open but close down churches? Why did Michigan Gov. Gretchen Whitmer insist that buying lottery tickets remain legal but made it illegal to buy garden supplies? And how did New York Gov. Andrew Cuomo use “science” to prohibit outdoor funerals but allow outdoor protests?

But as badly as our lockdowns have damaged local businesses, a potentially even bigger problem is created by the physical closure of schools. One of the most important functions of a civil society is to protect and educate its children, and the cancellation of in-person education stands to become one of the most detrimental acts of collateral damage during this pandemic.

California currently expects its 5-year-olds to complete kindergarten exclusively through online distance learning. For this dubious undertaking, the politicians are given passionate political cover. The Los Angeles Teachers Union maintains that “the only people guaranteed to benefit from the premature reopening of schools amidst a rapidly accelerating pandemic are billionaires and the politicians they’ve purchased” — as if billionaires typically send their kids to L.A. public schools. The wealthy will send their children to in-person private schools or hire additional tutors, while most American families will suffer from a widening education gap that could set their kids back years. Worst of all, none of this is medically substantiated.

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