Baltic Dry Index. 556 -26 Brent Crude 24.93 Spot
Gold 1628
Covid-19 cases 14/3/20 World 146,627 Deaths 5,461 (Maybe.)
Covid-19 cases 21/3/20 World 276,462 Deaths 11,417 (Maybe.)
The Fed's Cure Risks Being Worse Than the Disease
Jim Bianco
Bloomberg March 27, 2020
(Bloomberg
Opinion) -- The economic debate of the day centers on whether the cure of
an economic shutdown is worse than the disease of the virus. Similarly,
we need to ask if the cure of the Federal Reserve getting so deeply into
corporate bonds, asset-backed securities, commercial paper, and exchange-traded
funds is worse than the disease seizing financial markets. It may be.
In just
these past few weeks, the Fed has cut rates by 150 basis points to near
zero and run through its entire 2008 crisis handbook. That wasn’t enough
to calm markets, though — so the central bank also announced $1 trillion a day
in repurchase agreements and unlimited
quantitative easing, which includes a hard-to-understand $625 billion
of bond buying a week going forward. At this rate, the Fed will own
two-thirds of the Treasury market in a year.
But
it’s the alphabet soup of new programs that deserve special consideration,
as they could have profound long-term consequences for the functioning of the
Fed and the allocation of capital in financial markets. Specifically, these
are:
CPFF
(Commercial Paper Funding Facility) – buying commercial paper from the issuer.
PMCCF (Primary Market Corporate Credit Facility) – buying corporate bonds from
the issuer. TALF (Term Asset-Backed Securities Loan Facility) – funding
backstop for asset-backed securities. SMCCF (Secondary Market Corporate Credit
Facility) – buying corporate bonds and bond ETFs in the secondary market. MSBLP
(Main Street Business Lending Program) – Details are to come, but it will lend
to eligible small and medium-size businesses, complementing efforts by the
Small Business Association.
To put it
bluntly, the Fed isn’t allowed to do any of this. The central bank
is only allowed to purchase or lend against securities that have government
guarantee. This includes Treasury securities, agency mortgage-backed securities
and the debt issued by Fannie Mae and Freddie Mac. An argument can be made that
can also include municipal securities, but nothing in the laundry list above.
So how can
they do this? The Fed will finance a special purpose vehicle (SPV)
for each acronym to conduct these operations. The Treasury, using the Exchange
Stabilization Fund, will make an equity investment in each SPV and be in a
“first loss” position. What does this mean? In essence, the Treasury, not the
Fed, is buying all these securities and backstopping of loans; the Fed is
acting as banker and providing financing. The Fed hired BlackRock Inc. to
purchase these securities and handle the administration of the SPVs on
behalf of the owner, the Treasury.
In other
words, the federal government is nationalizing large swaths of the financial
markets. The Fed is providing the money to do it. BlackRock will be doing the
trades.
This scheme
essentially merges the Fed and Treasury into one organization. So, meet
your new Fed chairman, Donald J. Trump.
In 2008 when
something similar was done, it was on a smaller scale. Since few understood it,
the Bush and Obama administrations ceded total control of those acronym
programs to then-Fed Chairman Ben Bernanke. He unwound them at the first
available opportunity. But now, 12 years later, we have a much better
understanding of how they work. And we have a president who has made it
very clear how displeased he is that central bankers haven’t used
their considerable power to force the Dow Jones Industrial Average at least
10,000 points higher, something he has complained about many times before
the pandemic hit.
When the Fed
was rightly alarmed by the current dysfunction in the fixed-income markets,
they felt they needed to act. This was the correct thought. But, to get
the authority to stabilize these “private” markets, central bankers needed the
Treasury to agree to nationalize (own) them so they could provide the funds to
do it.
In effect,
the Fed is giving the Treasury access to its printing press. This means
that, in the extreme, the administration would be free to use
its control, not the Fed’s control, of these SPVs to instruct the Fed to
print more money so it could buy securities and hand out loans in an
effort to ramp financial markets higher going into the election. Why stop
there? Should Trump win re-election, he could try to use these SPVs
to get those 10,000 Dow Jones points he feels the Fed has denied everyone.
Australian Reporter Rita Panahi Takes the WHO, Chinese Regime to Task Over Coronavirus Lies
Posted: Mar 28, 2020 1:15 PM
Australian
reporter Rita Panahi slammed China's Communist Regime and the World Health Organization
for their failures to prevent the spread of the Wuhan coronavirus outbreak.
China was so worried about making sure they weren't blamed for the virus that
they did everything in their power to keep whistleblowers quiet. Instead of
sounding the alarm about the Wuhan coronavirus, the WHO parroted the regime's
talking points, saying the virus wasn't transmitted through person-to-person
contact. The organization also failed to recommend travel bans to China.
"I want
to talk about China's culpability and conduct throughout the coronavirus crisis
that began in Wuhan wet market. The Chinese Communist regime not only lied,
destroyed evidence and allowed the virus to spread, but it arrested doctors
who, back in December, tried to warn the world about what was happening in
Wuhan," she explained. "Some of the whistleblowers arrested and
accused of fabricating, disseminating, and spreading rumors have since died.
Other domestic critics, from a property tycoon to video bloggers have
vanished."
"China
is not a regime that tolerates dissent," Panahi explained. "China's
initial cover-up included destroying lab samples that established, in December,
the cause of unexplained viral infections in the Hubei province. How many lives
would have been saved if China had listened to experts instead of silencing
them?"
A study
carried out by the University of South Hampton showed that China could have
prevented 95 percent of Wuhan coronavirus infections "if it would have
implemented tough measures just three weeks earlier." Instead of being
proactive, the regime waited another month before taking action.
"What's
just as shocking is the World Health Organization's complicity in this global
pandemic," she said. "From the start, the WHO has unequivocally
praised China's response and pushed its absurd narratives while ignoring the
regime's dishonesty and recklessness."
Panahi
reminded viewers that back in January, the WHO shared a tweet citing Chinese
health official's who claimed there was no evidence the virus transmitted
through human-to-human contact.
"[The
WHO] refused to declare a pandemic until March 11th. And, as late as February,
it was parroting China in criticizing travel restrictions," she said.
"Don't forget that when Scott Morrison and Donald Trump implemented travel
bans against China in late January, they did so against WHO's advice."
Both China
and the WHO deserve to be held accountable for this pandemic. They could have
kept the Wuhan coronavirus from spreading around the world had they admitted
the virus began in China and was being transmitted through human-to-human
contact. Instead of giving other countries the heads up so they could prepare
or make decisions to protect their citizens, China was radio silent and they
punished those who spoke out.
Instead of
calling it the World Health Organization, we should call it the Chinese Health
Organization. At the end of the day, the organization is only concerned about
how the Chinese regime looks to the rest of the world.
Finally, the brutal reality of Covid-19
for the lucky/unlucky elderly. US Covid-19 chaos.
I Survived Covid-19. I Never Thought Rejoining Society Would Be So Hard
By Xiao Hui and Matthew Walsh
Mar 26, 2020 08:21 PM
The onset
On Jan. 18,
I went to a crowded exhibition at a Wuhan bookstore. I started feeling sick
that night: I had a low fever, felt listless, and had sore muscles.
The
following day, I went to the hospital. Doctors told me that many patients had
fevers like mine and that I should stay home, rest, and take the medicine they
gave me.
Within a few
days, my fever was joined by an upset stomach and wheezing. On Jan. 22, I went
back to the hospital. It was completely crammed: I waited from the late
afternoon until midnight before I finally saw a doctor, who immediately told me
there were no beds. As I got home that night, the authorities implemented a
citywide lockdown of Wuhan.
By Jan. 26,
I was feeling terrible. There were no cars available, so I walked slowly back
to the hospital, where a CT scan showed I had an infection in both lungs with
white patches that looked like ground-up glass — one of the hallmarks of
Covid-19. That’s when I realized I had the disease, but again I was informed
that the hospital was already full.
Knowing I
might never recover without immediate hospitalization, I frantically called
anyone I knew with medical connections. A friend told me that another hospital
was about to open a new ward to deal with the surge in patients. I rushed over
there and was lucky enough to get a bed in the intensive care unit. The ward
was completely full, and the facilities were extremely basic.
Within a few
days of being admitted into the ICU, I watched the elderly man in the bed next
to mine die. In the early hours of Jan. 29, I suddenly smelled something foul
and turned to see him lying rigid and shuddering. He was fighting so hard to
breathe that he had lost continence. Although I rang the bell for a doctor,
nobody came. I could only hold his hand and speak to him as he slipped away. He
must have been so lonely without his family beside him.
I stayed in
the ICU for eight days. During that time, I think eight patients there died.
A brush with
death
By my second
day in the ICU, I was running a fever of 38 degrees Celsius, had a terrible
stomach, and, worst of all, felt constantly winded.
I got along
well with the ward’s medical staff. I enjoyed chatting to the doctors about my
condition, and kept thanking them and telling them how well they were doing.
Nobody knows exactly how to treat this emerging disease, so I felt it was
important to praise the doctors and nurses and raise their confidence.
I didn’t
have much of an appetite for the first few days, but I forced myself to eat,
knowing it was important for my recovery. In fact, my overeating and lack of
exercise created a different problem.
Before the
epidemic, I had been told I have an impaired sugar tolerance — my doctors say
it’s an early sign of diabetes. One night, I suddenly felt fiercely itchy all
over. I scratched and scratched until I drew blood, but couldn’t subdue the
itch. After about an hour, I fell back exhausted. I was cold, especially in my
chest, which felt like ice. My whole body felt empty, as if I was floating
away. The sensation was one of total absolution as death drew near.
After a
period of confusion, I suddenly wondered if what I was experiencing was
something called ketoacidosis, which can occur in people with diabetes and
pre-diabetes when your insulin levels drop and your body starts burning fat as
fuel. Two things happen: your blood sugar levels spike, and acidic substances
are released into your blood.
I forced
myself upright and downed a cup of water. With no doctors around, I staggered
to where they kept some supplies and tested my blood sugar. The reading was
28.9. My normal level is about 6.
Knowing I
had to rapidly bring down my blood sugar level, I injected myself with several
doses of insulin from the supply station. Then I drank some more water and
returned to bed. Gradually, I began to feel better. In the morning, when a
doctor next came to the ward, I told him what had happened and asked him to
measure my blood sugar again: 8.9. The doctor said I’d probably saved my own
life.
After eight
days in the ICU, my pneumonia symptoms subsided and my nucleic acid test (NAT)
came back negative. I was finally transferred to the isolation ward.
A few of my
friends weren’t so lucky. As far as I know, at least five people in my amateur
photography group have died since the outbreak started.
A long road
to recovery
After returning
four more negative NATs in the isolation ward, I finally left the hospital on
Feb. 14. I was looking forward to getting back to normal; I didn’t think I’d
end up feeling even more alone.
One of the
many things we don’t know about Covid-19 is whether it leaves people with
lifelong ailments. I’m now about 18 kilograms lighter than when I went into the
hospital, can’t breathe as freely as before, and often feel as though my
windpipe and throat are blocked. We also don’t know if people who have recovered
from the disease can catch it again.
After
leaving the hospital, I spent 14 days quarantining at a hotel. I had to be very
careful about coming home. I didn’t want to infect my wife, who has
longstanding respiratory problems. Since I returned, we’ve confined ourselves
to separate rooms and worn masks around the house.
This disease
tests your spirit as much as your body, because it forces you to stay apart
from others. I particularly miss my dear little sister, who would often call
round at our house. Since the epidemic started, I haven’t seen or spoken to her
once. Perhaps she thinks it would be unlucky to contact me now.
People
outside the family shun recovered patients like me as well. Before I got sick,
I was enjoying a full and happy retirement. On the social messaging app WeChat,
I was a keen member of group chats for photography, swimming, cycling, and
outdoor climbing. Now, those chats are silent.
All of this
makes me very sad. The people I’m fondest of have effectively isolated me,
leaving me with nobody to speak to. When I do communicate with others, I can
see by their words and actions that they don’t want to be there. Everyone seems
to think I pose a risk to their health, so in that sense, my recovery has only
been temporary.
In the month
since I got out of the hospital, I’ve briefly left the house four times — to
charge my electric scooter, get a health code, collect some food, and collect
medicine from the hospital. Each time, the people I’ve dealt with — neighbors,
community volunteers, hospital staff — have recoiled from me or barked at me to
stand farther away from them. I feel like a plague victim.
All my life,
I’ve loved being around other people. Since retiring, my life has been rich in
group activities. But until society is ready to accept me again, I won’t be
attending events with lots of people. I don’t want to make them feel uneasy.
I’m looking
forward to going back out with my camera after Wuhan lifts its lockdown. But
I’ll be doing it alone.
Contact
reporter Matthew Walsh (matthewwalsh@caixin.com)
Thailand reports 143 new coronavirus cases and one death
March 29, 2020 / 6:03 AM
BANGKOK
(Reuters) - Thailand has 143 new coronavirus cases, bringing the total of cases
since the outbreak to 1,388, the spokesman of the government’s Center for
COVID-19 Situation Administration (CCSA) said on Sunday, giving the latest
daily update.
The country
also recorded one new fatality, bringing the total of death since the outbreak
to 7.
The latest
victim was a 68-year-old man from Nonthaburi province who had attended a
crowded boxing match in Bangkok where there had been a cluster of infections,
Taweesin Wisanuyothin, the CCSA spokesman said.
More
Two more Australians die after contracting coronavirus, bringing national death toll to 16
29 March 2020
The number
of Australian people who have died after contracting COVID-19 has now reached
16, following the death of two more people overnight.
A man aged
in his 80s died of coronavirus in hospital, taking Victoria's death toll to
four.
There have been
84 new cases confirmed overnight, bringing Victoria's total to 769. Most cases
are in metropolitan Melbourne.
The cases
include 419 men and 346 women, aged from three to 88.
There are 21
confirmed cases of COVID-19 in Victoria that may be through community
transmission, the health department said.
More than
39,000 Victorians have been tested and 193 people in the state have recovered
from coronavirus.
"If you
can stay at home, you must stay at home. This is the only way we are going to
defeat COVID-19. It is the only way we are going to slow down the spread,"
Victorian Health Minister Jenny Mikakos said.
In
Queensland, a 75-year-old woman who had been a passenger on the Ruby Princess
cruise ship that docked in Sydney has died, taking the state's toll to two.
The woman,
who died in a Caboolture Hospital, was a passenger on the Ruby Princess cruise
ship, says Queensland Chief Medical Officer Jeannette Young.
More
Singapore reports third coronavirus-related death
March 29, 2020 / 6:13 AM
SINGAPORE
(Reuters) - Singapore reported its third coronavirus death on Sunday, a day
after the city-state’s total infections topped 800.
The health
ministry said the patient, a 70-year-old male Singaporean, had been in
intensive care for 27 days before he passed and that he had some pre-existing
conditions.
Singapore’s
other two fatalaties related to the disease came just over a week ago and were
also elderly with underlying conditions.
Trump drops idea of New York lockdown as U.S. death count crosses 2,000
March
28, 2020 / 11:42 AM
WASHINGTON
(Reuters) - President Donald Trump said on Saturday that he would issue a
travel warning for the hard-hit New York area to limit the spread of the
coronavirus, backing off from an earlier suggestion that he might try to cut
off the region entirely.
“A
quarantine will not be necessary,” he said on Twitter.
Trump’s
announcement came as the U.S. death count crossed 2,100, more than double the
level from two days ago. The United States has now recorded more than 122,000
cases of the respiratory virus, the most of any country in the world.
More
This weekend’s musical diversion. Boccherini sets the Covid-19 pandemic to
music, and he’d never heard of viruses, let alone Covid-19.
Luigi Boccherini / Luciano Berio: Ritirata notturna di Madrid (1975)
The monthly Coppock Indicators finished February
DJIA: 25,409
-75 Down. NASDAQ: 8,567 +171 Up. SP500: 2,954 +133 Up.
A mixed bag. But given the severity of the still growing coronavirus
crisis, I wouldn’t follow technical signals in what I think will turn into the
first depression since the 1930s. Barring a miracle recovery in all three
markets, the monthly Coppock indicators are heading for a reversal.
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