This may set your hair on fire, so before delving in this morning, take a good, deep breath and count to 10. OK, now you may continue..
Down Futures -367: Two big drivers: First is the number of COVID Cases took a huge leap up in today’s data:
You can see what happened and why we’ve been expecting this: China had been running a propagation rate of about 2% per day. Then, they changed methodology to restate a lower number. Now that the bug is in the wild, out of China, we can see in the highlighted line reason number one for your hair to spontaneously combust.
Second Reason for Market Panic?
The Sacramento Bee is reporting on a case – now confirmed – out of northern California where there is no known contact that could have brought the virus into the victim’s vicinity.
Forget China contact – what about Thailand which has been the Wuhan analog to Baja? Where are the bug police when we need ’em?
What’s Ahead for Markets?
We have a couple of charts to run out today: The first, based on early futures, is where the market was heading 2-hours prior to the open in futures trading. It’s not a pretty sight, but as we pointed out to our Peoplenomics.com subscribers Wednesday, it’s the “red zone” in this – along with the lower trend channel – where the real battle may be fought:
Our approach to the stock market has been slowly-evolved over time. Ever since 2001 when Peoplenomics’ forerunner, the “UrbanSurvival Inside Report” was launched. Stalking the Future takes patience.
The method we use makes a simple, easily proven assumption, namely that market segments don’t all move together. BUT, when you look at multiple indices you can see big picture trends in stark relief.
While this morning’s downside continuation shouldn’t set anyone’s hair on fire – unless you got caught on the wrong side of a triple levered ETF and failed to cut losses and reverse positions – the Longer Term/Bigger Picture does begin to concern us. Which is why the possible “red zone” fight ahead is so bothersome. Fail there are the road to S&P 1800 opens.
Let’s look at how the market fell apart in the 1929 bubble – the unhappy ending of which is in the history books as the Great Depression – and the present market run from the lows in early 2009 up until present:
There is a “reasonable harmony” between Bubbles because in mathematical terms, all market bubbles are “self-similar.”
That said, the shape of the top IS determined by the flow of news events. (See: Youssefmir, Hogg, and Huberman, page 17 here.) Their notion is simple – namely that the shape of the pricking moment of a Bubble – will be determined by an informational event and the timing of the information injection, in turn, shapes what happens thereafter.
Now, to my simple-minded way of viewing things, all three of these guys ought to have shared a Nobel Prize in Economics. So far, though, their insight seems to be lost on the academics who miss the practicality of their work.
I’m working on a report for Peoplenomics subscribers Saturday that is an extremely interesting extension of both this concept as well as having a big spiritual (as in global consciousness) aspect of it, as well.
Point is: If you are a Day Trader, your hair is probably already singed. If you are a swing trader, your hair may be starting to smolder. If you’re a long-term position inventor, you will see in the Saturday report where our key indicator is…but we won’t go into details publicly about that.
90-minutes ahead of the opening, the Dow futures were down 375 points.
The reason is simple: The latest pandemic data shows the case count is going up like crazy! Look at the percent change in cases and you’ll see why the panic is back. Markets react to events in advance.
The Trump administration’s naming of VP Mike Pence is, in our view, a good start. Except for the one tiny problem: The Virus is like Climate: You can’t just write a check and be done with it.
Let’s see how today’s projections are penciling out:
As you can see, we’re looking at a mortality rate that seems to be stabilizing in that 3.28% range using our method. By the first of May we could be around 250,000 cases and deaths at around 9,000. Remember, this is still a lower loss of life than seasonal flu!
Peoplenomics subscribers can open and save a copy of this spreadsheet with data loading instructions to keep it current here.
Locusts: Is there a Media Clampdown?
This is one of those bothersome “conspiracy theories” with no real answer.
True, a handful of corporations “own the news” in the US. But also true, news goes where the ratings are and pandemic trumps locusts.
But, we’re a bit suspicious when the Mainstream Media today is all over the “China to send 100,000 duck army to fight the locusts.
Sure, sure, dandy copy. But for the typical (somewhat less easily-led) UrbanSurvival reader, the deeper thinking may be found on the pages of Foreign Policy. What makes the story here so damn interesting is that it quotes a U.S. policy expert who raises the parallel to the Dust Bowl of the Great Depression.
If you haven’t been following our advise to slowly begin to load up on long-term goods, you haven’t been paying attention. Prepping and isolation are likely to become critical and it’s only a matter of when, not so much IF – since today’s “run rate” on the virus will have us passing a quarter million cases around May 1 and by June 1 we anticipate well over 10,000 dead.
Happy-talk all you want, but this isn’t a happy outlook. Like “If the Virus doesn’t get you, you’ll starve.” Sheesh.
(And then survivors this fall will choose between a lefty socialist and an ADHD ballot…what could go wrong, right?)
So, we will keep today’s column short, to the point, and go on to the “filler material for idiots” (FMFI)
Look, we’re sorry to read Family living in motel speaks out amid homelessness crisis, but wait 12 months. Ought to be lots of empty homes, if we’re reading this right.
Say what? Lawyers say new evidence clears Lori Loughlin in college scandal. So the kid’s way in wasn’t bought? Well…..not exactly. But there are apparently notes showing the parents thought it was a legit donation.
Here’s another one of those “brainpower among famous” stories: ‘Shark Tank’ star lost nearly $400,000 in scam. My point? Seems to us if the “famous” can make mistakes like getting scammed and on this whole college entrance thing, why can’t people understand that when Hollywood types speak on politics they’re no brighter than the rest of us?
Mystery: If the U.S. is a big energy exporter now (uh…so goes the Trump song and dance…) why is the Moscow Times reporting “U.S., Britain Double Russian Oil Purchases?” Inquiring minds, bubba…
CBS Missed A Couple? Top 10 myths about climate change. Missing: There is no climate change other than what’s been going on since the Ice Age and 2, problem’s over and fading thanks to the virus.
The good part of the story is CBS putting out that “The temperature records are carefully fine-tuned by data experts…” Which is like asking the fox to count chickens. Climate grantsmanship is what (repeat after me, here) “It’s a business model!!!”
And if denial hasn’t set in yet, got just the thing for you: “Galapagos cruises spotlight economic and environmental pressures challenging the islands.”
OK, Fed Repo Depot just only lit up
$25-billion $55.19 billion in repo’s this morning. Why, news of this makes the semi-conspiratorially minded wonder if the whole market decline isn’t the Fed backing out of free money and letting the vxirus worries get the blame. When really, the market is suffering withdrawal from declining Repo Depot money for the mouse house.
Too early to get a drink around here?
Write when you get rich,