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When It’s Over, Will We Be the Same America?

When It's Over, Will We Be the Same America?

When It’s Over, Will We Be the Same America?

If March shocked this nation as severely as 9/11, what is coming may be even more sobering. 

“Depend upon it, sir, when a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully,” said Samuel Johnson.

And as it is with men, so it is with nations.

Monday, Dr. Deborah Birx, White House coronavirus response coordinator, projected some 100,000 to 200,000 U.S. deaths from the pandemic, “if we do things almost perfectly.” She agreed with Dr. Anthony Fauci’s estimate that, if we do “nothing,” the American dead could reach 2.2 million.

That 2 million figure would be twice as many dead as have perished in all our wars from the American Revolution to the Civil War, World War I and II, and Korea and Vietnam.

This does indeed concentrate the mind wonderfully.

Now add to this slaughter of our countrymen a market plunge steeper than the 1929 Crash and a 1930s-style Depression. Wall Street analysts are talking of a wipeout of 30% of our GDP and unemployment reaching 35%.

What a difference a month can make.

On March 3, Super Tuesday, we were caught up in the 14 primary contests after Joe Biden’s stunning victory in South Carolina, which broke the momentum of Sen. Bernie Sanders’ wins in Iowa, New Hampshire and Nevada.

What March 2020 produced and what it appears to portend is a sea change in U.S. history, an inflection point, an event after which things never return to what they were.

The coronavirus crisis seems to be one of those epochal events that alter the character of the country and the course of the republic.

Consider what has happened in three weeks.

The Republican Party, the party of small government and balanced budgets, approved with but a single dissent a $2 trillion emergency bill. There is talk now of a second $2 trillion bill, this one for infrastructure.

…click on the above link to read the rest of the article…

The Fate Of Oil’s Torrid Rally Hinges On Trump’s Meeting With US Shale Producers Today: Here’s Why

The Fate Of Oil’s Torrid Rally Hinges On Trump’s Meeting With US Shale Producers Today: Here’s Why

Oil has staged a tremendous surge in the past 48 hours, largely on the back of speculation that Trump will “encourage” Saudi Arabia and Russia to pursue output cuts, even though as it subsequently emerged when Trump tweeted that the “hopes” to see an N-OPEC output cut, it was an “exaggeration” and wishful thinking more than statement of fact. However, whereas the initial rally – which send the price of oil soaring by 25% on Thursday, or the most ever – faded, the rally got a second wind on Friday following reports that the R-OPEC (Russia + OPEC) alliance of oil producers led by Saudi Arabia and Russia is set to debate production cuts of at least 6 million barrels a day Monday and consider inviting U.S. producers to participate, the WSJ reported citing OPEC country officials.

However, even that hypothetical best case outcome for oil bulls – and certainly the US shale industry – comes with strings attached, and the outcome of Monday’s virtual summit between OPEC, which Saudi Arabia effectively crushed one month ago when it decided to flood the market with oil, and non-OPEC nations “will largely depend on a discussion Friday between the White House and U.S. oil companies” according to the WSJ.

The reason: both Saudi Arabia and Russia are demanding that US shale producers, some of whom such as Whiting Petroleum have already filed for Chapter 11 protection yet continue to pump as normal, join the production cuts. As the WSJ reports, “Saudi Arabia and Russia won’t cut unless they get signals from U.S. producers they will reduce output, the officials said. But they added that official joint curbs would be more difficult to enact in the U.S. because of antitrust laws.”

…click on the above link to read the rest of the article…

March Jobs Disaster: 701,000 Jobs Lost, Unemplyment Rate Soars Most In 45 Years As US Slides Into Depression

March Jobs Disaster: 701,000 Jobs Lost, Unemplyment Rate Soars Most In 45 Years As US Slides Into Depression

Just like that the 113 record straight months of employment growth is over with a bang.

While today’s payrolls report was expected to be not quite as terrible as the recent initial claims suggested, especially since the March survey week took place around March 13 or ahead of the big shutdown and layoff announcements, it ended up being catastrophic nonetheless, with the BLS reporting moments ago that a whopping 701K jobs were lost in March, 7x more than the 100K expected, and just shy of the worst payrolls prints recorded during the financial crisis.

That this happened well before the worst of the cronavirus induced coma hit, suggests that what comes next will be truly biblical. 

For some reason the famous “Taleb Turkey” comes to mind:

Not like it matters, but there were also revisions: the change in total nonfarm payroll employment for January was revised down by 59,000 from +273,000 to +214,000, and the change for February was revised up by 2,000 from +273,000 to +275,000. With these revisions, employment gains in January and February combined were 57,000 lower than previously reported.

Private sector jobs dropped by 713K (vs Exp. 163K), with almost all the drop the result of a record collapse in service-providing jobs.

And of all service jobs, leisure and hospitality were hardest hit:

The unemployment rate soared from 3.5% to 4.3%, led by a record surge in Hispanic unemployment.

In March, the unemployment rate increased by 0.9 percentage point to 4.4 percent. This is the largest over-the-month increase in the rate since January 1975, when the increase was also 0.9 percentage point. The number of unemployed persons rose by 1.4 million to 7.1 million in March. The sharp increases in these measures reflect the effects of the coronavirus and efforts to contain it.  The participation rate plunged from a 7-year-high to tie the lowest level in 5 years.

…click on the above link to read the rest of the article…

Could the Covid19 Response be More Deadly than the Virus?

Could the Covid19 Response be More Deadly than the Virus?

The economic, social and public health consequences of these measures could claim millions of victims

The initial, alarming estimates of deaths from the virus COVID-19 were that as many as 2.2 million people would die in the United States. This number is comparable to the annual US death rate of around 3 million. Fortunately, correction of some simple errors in overestimation has begun to dramatically reduce the virus mortality claims. 

The most recent estimate from “the leading US authority on the COVID-19 pandemic” suggests that the US may see between 100,000 and 200,000 deaths from COVID-19, with the final tally likely to be somewhere in the middle.” This means that we are expecting around 150,000 US deaths caused by the virus, if the latest estimates hold up.

How does that compare to the effects of the measures taken in response? By all accounts, the impact of the response will be great, far-reaching, and long-lasting. 

To better assess the difference we might ask, how many people will die as a result of the response to COVID-19? Although a comprehensive analysis is needed from those experienced with modeling mortality rates, we can begin to estimate by examining existing research and comparative statistics. Let’s start by looking at three critical areas of impact: suicide and drug abuse, lack of medical treatment or coverage, and poverty and food access.

SUICIDES AND DRUG ABUSE

According to the National Center for Health Statistics, over 48,000 suicides occurred in the US in 2018. This equates to an annual rate of about 14 suicides per 100,000 people. As expected, suicides increase substantially during times of economic depression. For example, as a result of the 2008 recession there was an approximate 25% increase. Similarly, during a peak year of the Great Depression, in 1932, the rate rose to 17 suicides per 100,000 people.

…click on the above link to read the rest of the article…

Depression Strikes America, Looting Begins, Panic Searching “Buy Ammo” Hits Record

Depression Strikes America, Looting Begins, Panic Searching “Buy Ammo” Hits Record

With a labor market in freefall, ten million Americans have lost their jobs in two weeks. CNN reported Thursday afternoon that stimulus checks for households could take up to 20 weeks, which is creating a perfect storm of possible social unrest. 

The Federation of Red Cross and Red Crescent Societies recently warned that a “social bomb could explode at any moment” over Western cities. That is because the evolution of the pandemic, which has crashed the American economy into a depression, could result in social unraveling in major metros, specifically in low-income areas. 

We’ve noted in the last several weeks that Americans are panic hoarding guns as the fear of social unrest could be imminent. President Trump signed an executive order last Friday that allows for up to one million National Guard and reservists to be called up to fight the virus or be used to maintain social order. 

With lockdowns across the country, the National Guard has been deployed across many states. Here are some sights from Baltimore: 


Baltimore

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Signs of social unrest are already starting to develop this week. Law enforcement agencies in South Carolina and California have charged people with looting businesses during the shutdowns, reported The Sun

Police in Santa Cruz, California, arrested five people who were robbing businesses in the city, despite a “shelter-in-place” public health order enforced by the state government. 

Police detain a man suspected of looting in Santa Cruz
Aftermath of shop raided by robbers in Santa Cruz 

In South Carolina, police arrested two men as they attempted to raid a storage warehouse unit. 

…click on the above link to read the rest of the article…

U.S. Silver Eagle Sales Surge Past 5 Million In March: Availability At Low Prices… CHECK HERE

U.S. Silver Eagle Sales Surge Past 5 Million In March: Availability At Low Prices… CHECK HERE

With the U.S. Mint now temporarily suspended, it will become even more difficult to acquire Silver Eagles.  According to James Anderson at SilverDoctors, the U.S. Mint shut down its West Point Facility due to an officer testing positive for the virus.  The U.S. Mint West Point facility will remain closed for two weeks until further notice.

However, the U.S Mint updated its Silver Eagle sales on the last day of the month to show a total of 5.5 million sold. Since my previous update, the U.S. Mint sold another 650,000 Silver Eagles, for a total of 5,482,500.

The last time the U.S. Mint sold Silver Eagles to this level in March was back in 2014, when 5,354,000 coins were sold.  With the premiums on Silver Eagles exploding, investors are now quoted delivery times of 3-4+ weeks or months.

I spoke with Dan at Cloud Hard Assets today, and I was shocked to find out that the quoted time for 1,000 oz wholesale silver bars was 4-6 weeks!!!!  Can you believe that??  When the silver price crashed in 2008, investors were buying 1,000 oz bars and turning them into small coins and bars.  However, that option is much more difficult because the availability of 1,000 wholesale silver bars is similar to RETAIL BULLION… LOL.

I was also surprised to hear that Cloud Hard Assets was only charging $6.50 over spot to purchase Silver Eagles. I have been making comparisons of some of the well-known online precious metals dealers Silver Eagles BUY & SELL prices, and have now included the price from CLOUD HARD ASSETS which I sponsor on this website:

…click on the above link to read the rest of the article…

Tucker Carlson: The WHO Helped China Cover-Up Coronavirus

Tucker Carlson: The WHO Helped China Cover-Up Coronavirus

And the U.S. media turned a blind eye.

Tucker Carlson exposed during a powerful monologue last night how the World Health Organization helped China cover-up the severity of coronavirus and how the U.S. media turned a blind eye.

The Fox News host noted how World Health Organization Director-General Tedros Adhanom “got his job with Chinese support after he covered up cholera outbreaks in his home country” of Egypt.

Tedros has denied the allegation, which centered around claims he had downplayed cholera epidemics in Ethiopia in 2006, 2009 and 2011 by passing them off as “acute watery diarrhea,” a symptom of cholera. 

The United Nations later said that more lives could have been saved if the epidemic had been accurately labeled as cholera.

Carlson then accused Adhanom of setting the standard for corruption within the WHO by congratulating China for its “speedy” response to coronavirus in late January despite widespread evidence that China covered up the outbreak for over a month, lied about its severity and then silenced whistleblowers who tried to warn the world.

“Everything you just heard him say there was a lie,” said Carlson, highlighting an Australian 60 Minutes piece which features an expert explaining how China knew human to human transmission of COVID-19 had happened back in December. 

Indeed, as we previously highlighted, on January 14th, the WHO was amplifying Chinese fake news that no human to human transmission of coronavirus had occurred.

…click on the above link to read the rest of the article…

Coronavirus is bad: The economic fallout may be more deadly

Coronavirus is bad: The economic fallout may be more deadly 

The immediate impacts of the Coronavirus worldwide and in the United States is horrific but the economic fallout after this pandemic ends may be more deadly.

Economic Fallout Caused By Coronavirus Will Be Far Worse

But the economic fallout and resulting impact on our fragile just-in-time supply-chain infrastructure from Covid-19 and the resulting austerity and deaths may easily surpass what was attributed to the 1930’s economic collapse in the U.S. during the Great Depression, and may last for a decade or more.

Few people realize that the United States imports a major percentage of what Americans need to maintain the lifestyles to which they have grown accustomed and depend. And many of those imports have already slowed, significantly. It’s like pushing a huge boulder uphill; the moment you lose momentum, it can roll-back and right over the top of you.

Excerpt from Foreign Policy Magazine:

Beyond the immediate treatment of those infected with coronavirus, however, Western governments have almost universally shut down rather than ramped up production. As one financial analyst pointed out, “lockdown economics” is in many ways the exact opposite of the wartime economics of total mobilization. 

During both world wars, economic mobilization enrolled unprecedentedly large groups of male and female workers in mass production. The coronavirus’s disruption of supply chains and the social distancing measures of today, however, are currently putting millions of employees in the manufacturing and service sectors out of work.

Sorting Out The Pandemic May Not End The Crises

Folks that loiter too long in cities in the hopes that sorting out the pandemic will end the crises may be in for a very rude, and potentially deadly surprise (time is already a critical aspect for effective tactics).

…click on the above link to read the rest of the article…

“The Biggest Decline Ever”: Goldman Now Sees US GDP Crashing 34% In Q2

“The Biggest Decline Ever”: Goldman Now Sees US GDP Crashing 34% In Q2

Just over a week ago, when we reported on the ongoing feud between Goldman and JPM to come up with the most terrifying GDP forecast for the US, and when we asked if a Second Great Depression has begun after Goldman’s chief economist Jan Hatzius slashed his Q2 GDP forecast from -5% to -24%, we said “we expect Goldman to take the machete to this analysis as well in the coming days, because if the US economy is indeed paralyzed for at least one quarter, then all of GDP could be lost.”

We were right, because early on Monday morning Goldman’s Haztius did just that, and in a report titled “The Sudden Stop: A Deeper Trough, A Bigger Rebound”, he writes that he is “making further significant adjustments to our GDP and employment estimates. We now forecast real GDP growth of -9% in Q1 and -34% in Q2 in qoq annualized terms (vs. -6% and -24% previously) and see the unemployment rate rising to 15% by midyear (vs. 9% previously).”

Detailing the assumptions behind his latest revision, Hatzius explains that he has increased his estimates of the peak hit to services consumption, manufacturing activity, and construction, “in light of new evidence on the severity of the hit across the different sectors” and now expects the level of GDP in April to be 13% below the January/February trend, as shown in Exhibit 1. “We assume that this drag then fades gradually by 10% each month in the services industry and by 12.5% in the manufacturing and construction industries.”

Behind the core of the drop Goldman sees a 19% annualized drag from services consumption on Q2 growth, on top of a 3pp drag on Q1 growth. as shown in the next chart.

…click on the above link to read the rest of the article…

Energy Collapse, Earnings Ennui, & Consumer Credit Cracks

Energy Collapse, Earnings Ennui, & Consumer Credit Cracks

Summary:

The energy sector has lost extraordinarily $1.15trn in market value this year as oil prices have plunged to almost unimaginable levels. 

In this equity update we provide investors with different ways to play the havoc in the energy sector. We also take a look at earnings this week with especially Carnival earnings being the most interesting to watch as the cruise industry is in a severe crisis due to COVID-19.

Lastly, we focus on consumer credit and the apparent weakness observed in China and how that could be a forewarning of what to come in the US and Europe. As a result we recommend investors to add Mastercard and American Express to their watchlists.

The global energy sector has been punched in the gut by first a slowing economy last year and then this year by an oil price war between Russia and Saudi Arabia. Making things worst the sector is now experiencing an abrupt 20% oil demand reduction equivalent to 20mn barrels a day or the entire consumption of the US. The oil futures curve is in steep contango as the active contract in Brent today went below $23/brl and stories have recently surfaced that physical oil is being transacted at $8/brl and oil storage is running out of capacity. As we talked about on our Market Call this morning the constraint on physical storage and ongoing demand destruction could push the front-end of oil futures down even further.

The current oil price creates extreme shareholder destruction with the MSCI World Energy Index losing $1.15trn in market value this year.

…click on the above link to read the rest of the article…

The Unthinkable Is Happening: Oil Storage Space Is About To Run Out

The Unthinkable Is Happening: Oil Storage Space Is About To Run Out

In the past three weeks, oil plunged and has continued to plunge even more in the aftermath of the oil price war declared between Saudi Arabia and Russia, and where US shale (and its junk bonds) has been caught in the crossfire. However, as we reported last week, we may get to the absurd point when the price of a barrel of oil not only hits $0 but goes negative.

The reason: according to Mizuho’s Paul Sankey, at a whopping 15MM b/d in oversupply, crude prices could go negative as Saudi and Russian barrels enter the market. According to Sankey, much of the US 4MM bpd in crude exports will be curtailed as prices fall and tanker rates soar. And with US storage roughly 50% full, and able to take another 135MM bbl more, assuming a build rate of 2MM b/d, the US can add 14MM bbl/week for 10 weeks until full.

As a result, there is a now race between filling storage and negative pricing “unless U.S. decline rates can outpace inventory builds, which we very much doubt.” Said otherwise, absent dramatic changes, in roughly 3 months, energy merchants will be paying you if you generously take a couple million barrels of crude off their hands.

It went from bad to an outright disaster earlier this week when Goldman, Vitol, and the IEA all raised their estimate for daily oil oversupply to an unthinkable 20 million barrels per day, as a result of the collapse in oil demand as the global economy grinds to a halt coupled with Saudi Arabia’s determination to put all of its higher-cost OPEC peers out of business.

…click on the above link to read the rest of the article…

Dr. Fauci: “We’re Going To Have Millions Of Cases” And “Between 100K & 200K Deaths”

Dr. Fauci: “We’re Going To Have Millions Of Cases” And “Between 100K & 200K Deaths”

The last time Dr. Anthony Fauci did the Sunday Shows a few weeks back, he achieved a vaunted Washington milestone by doing all five network and cable Sunday shows – NBC, ABC, CBS, Fox News & CNN – in one day. That was back when President Trump’s approval rating was soaring, and the good doctor was indisputably the lead ‘subject matter expert’ guiding the White House’s response.

That was less than a month ago. But in that time, so much has changed.

President Trump and the good doctor are said to be at odds over some vaguely critical statements made by Fauci. Of course, that didn’t stop the administration and that task force’s media team from sending him out to do more Sunday Show appearances as officials hope futures will open higher after Friday’s selloff following the first three-day rebound since February.

Still, as the death toll in the US crept above 2,000, Dr. Fauci, officially the director of the National Institute of Allergy and Infectious Diseases and a member of the White House coronavirus task force told CNN’s “State of the Union” that models suggest the coronavirus will infect millions of Americans and could kill between 100,000 to 200,000.

However, he stressed that these projections are really a “moving target”, and that it’s possible the numbers could be much lower – or much higher – depending on how the US handles the response. So far, the disorganized response at the federal level has left a hodge podge of states to deal with their own problems, which is why Louisiana Gov. John Bel Edwards – a Democrat – is begging the Feds for help before the outbreak completely overruns his state’s capacity to handle it.

…click on the above link to read the rest of the article…

Trump Weighs “Enforceable” Quarantine Order For Greater New York, Including Conn. & NJ: Live Updates

Trump Weighs “Enforceable” Quarantine Order For Greater New York, Including Conn. & NJ: Live Updates

Summary:

  • Global case total tops 600k
  • Japan fast-tracks approval of treatment drug for COVID-19
  • Third UK minister self-quarantines after showing symptoms of virus
  • Trump weighing enforceable quarantine order for all of greater NY area
  • Trump tells NBC reporter that quarantines of New York, NJ & Conn. were “possible”
  • Italy case total surpasses China
  • Spain reports deadliest day yet
  • UK case total climbs north of 17k
  • Navy hospital ships leave for New York, LA
  • Abe says he’s “just barely avoiding” declaring a national emergency
  • Yale University slammed for denying aid to city of New Haven
  • Shinzo Abe promises unprecedented stimulus package
  • Trump gives Pentagon power to call up retired soldiers and reservists
  • NYPD detective dies from COVID-19
  • Italian centennarian survives battle with COVID-19

*   *   *

Update (1420ET): As the death toll skyrockets, Spanish officials said they would need to tighten quarantine rules, and are now ordering all people to stay indoors at all times, unless they’re going to work at an “essential” job. We expect the bare minimum of exceptions (trips outside permitted to get food) will continue.

Meanwhile, in France, large numbers of the public continue to ignore the quarantine.

Though France’s health minister said Saturday that the country could soon face shortages of critical drugs, he assured the public that an order for 1 billion masks had recently been put in to ‘China’.

In Italy, the tone was far more somber.

*   *   *

Update (1412ET): The coronavirus outbreak has pitted many interests against one another in the scramble for resources. But some of the most flagrant examples of communal selfishness so far have occurred in ritzy Connecticut, where a town full of wealthy bankers and doctors shut down a drive thru testing center (well, they stopped it from opening in the first place), and now, Yale University is at the center of a controversy after refusing to allow the town access to any of its (now empty) facilities to help the community fight off the virus.

…click on the above link to read the rest of the article…

All The Craziest Things About America Are Being Highlighted By This Virus

All The Craziest Things About America Are Being Highlighted By This Virus

“Corona is a black light and America is a cum-stained hotel room,” comedian Megan Amram colorfully tweeted a couple of weeks ago. Her observation has only grown more accurate since.

The corporate cronyism of America’s political system has been highlighted with a massive kleptocratic multitrillion-dollar corporate bailout of which actual Americans are only receiving a tiny fraction. Instead of putting that money toward paying people a living wage to stay home during a global pandemic, the overwhelming majority of the money is going to corporations while actual human beings receive a paltry $1,200 (which they won’t even be getting until May at the earliest) at a time of record-smashing unemployment.

America’s capitalism worship has been highlighted with Wall Street Journal headline “Dow Soars More Than 11% In Biggest One-Day Jump Since 1933” running at the exact same time as “Record Rise in Unemployment Claims Halts Historic Run of Job Growth — More than 3 million workers file for jobless benefits as coronavirus hits the economy“. Stocks are booming, Amazon is surging, and mountains of wealth are being transferred to sprawling megacorporations, while actual human beings are terrified of what the future holds.

America’s joke of a healthcare system is being highlighted as uninsured COVID-19 patients are racking up $35,000 medical bills and even insured COVID-19 patients are looking at out-of-pocket expenses in excess of $1,300. Combine this with the millions of Americans getting thrown off of employer-provided health insurance and you’re looking at a huge number of people who will avoid getting tested and avoid treatment as much as possible. Both heads of America’s two-headed one-party system have spent decades forcefully creating this dynamic.

…click on the above link to read the rest of the article…

US Reports Largest Jump In New Cases, Deaths As “Apocalyptic” Surge Rocks Hospitals In New York, New Orleans: Live Updates

US Reports Largest Jump In New Cases, Deaths As “Apocalyptic” Surge Rocks Hospitals In New York, New Orleans: Live Updates

President Trump’s hurried demands to get the nation “back to work” before Easter probably couldn’t come at a worse time. Across the US, but mainly in a handful of ‘hot spots’, most notably New York City and the surrounding area, the number of confirmed cases and deaths attributed to COVID-19 is climbing at an alarming rate.

According to John Hopkins data, Wednesday was the deadliest day yet for the US with 233 fatalities reported, taking the US to 65,273 cases and 938 deaths. In New York and California, the number of confirmed cases is doubling every few days.

As Russia reports record growth for a second day, President Vladimir Putin has ordered the country’s capital and largest city, Moscow, to close up all restaurants, bars and “non-essential” shops. In an online post, Moscow mayor Sergei Sobyanin ordered the closure of government offices and religious sites – which he urged Muscovites not to visit – and asked all other Russians not to visit the capital during a planned ‘nationwide holiday’ set to last for all of next week. The Kremlin has also halted all international air traffic, both for airlines and charter flights, excluding repatriation flights bringing Russian citizens back into the country.

Russia reported 182 new coronavirus cases in the past 24 hours on Thursday, bringing the country’s total to 840, along with 3 deaths.

Last night, President Putin delivered a nationwide address where he delayed a vote on constitutional amendments that would allow him to remain in the Kremlin until 2036, and announced that next week would be a national holiday, urging Russians to stay at home. He didn’t declare a national emergency or any other type of special circumstance, but a government medical advisor has reportedly told Putin that given the spread already documented in Moscow, that he must shut the country down to prevent a full-blown outbreak.

…click on the above link to read the rest of the article…

Olduvai IV: Courage
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Olduvai II: Exodus
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