How Far Will the U.S. Economy Plunge During Lockdown?

“Three times deeper than the Great Recession?”

By Wolf Richter for WOLF STREET.

No one has ever been through an economy where enormous shifts have occurred, from one day to the next, shutting down part of the economy but also generating sectors that are vastly more vibrant than ever before. Monthly or quarterly economic indicators leave us in the dark because they lag too far behind and are at the moment largely useless. What we need is high-frequency data – daily and weekly that track this shifting economy in near-real time.

For example, there has been an enormous boom in ecommerce – but we won’t get ecommerce data for Q1 until mid-May and for Q2 until August. Best Buy reported last week that its online sales had surged by 250% but that it would furlough 51,000 hourly store employees as stores were closed to customers, allowing only for curbside pickup. That duality that is now widespread impacts the economy in strange ways.

Grocery store and supermarket sales – which are normally the epitome of slow and steady growth tied to inflation and population growth – are suddenly booming. Kroger reported a 30% surge in “identical retail supermarket sales without fuel.”

Anything having to do with working-at-home, including hardware sales, is booming. Everything and anything that is online is booming — as are the sectors that make it all work, including delivery services. And there are other sectors that are suddenly hot.

But other parts of the economy have essentially collapsed, with near-zero revenues, such as sit-down restaurants, sports & entertainment events, or the entire travel and accommodations industry, including airlines and hotels.

Some manufacturing plants are operating, but many others are not. Much of the construction industry has shut down. Housing and auto sales are still ongoing, but at far lower levels.

Supply chains are misaligned, insufficient for the surging activity at supermarkets and ecommerce, but useless for commercial venues such as restaurants and schools that have been shut down.

There have been some shortages of meat at grocery stores. But meat meant for restaurants is stuck because the meatpackers and middlemen for the restaurant and cafeteria industry are either not part of the long-established supply chains of large supermarkets, or the packaging and quality is inappropriate for supermarkets. A lot of smart people are trying to resolve these supply chain issues.

Agriculture is operating mostly. Oil drilling has collapsed because of the demand for oil has collapsed, and the entire supply chain to the oil-and-gas sector, including the equipment manufacturing sector, and the services supporting it all have ground to a halt.

Consumers are still spending money, but they’re spending less, and they’re spending it in different ways. So estimating where GDP will be in an economy that has shifted so suddenly and so dramatically, and where activity in many sectors has plunged from one day to the next is going to be tough.

But here is one effort, initiated in early March in its current form: The New York Fed’s Weekly Economic Index (WEI), released today for the week ending April 18, is based on ten daily and weekly indicators – “timely and relevant high-frequency data,” as it says – of “real economic activity.” These indicators cover consumer behavior, the labor market, and production. The researchers putting the index together have scaled the index “to align with the four-quarter GDP growth rate.”

The index has plunged over the past five weeks to -10.95%. If this reading persists for the entire second quarter, then the year-over-year GDP plunge in Q2 is expected to be around -11%:

The above chart shows how the index declined during the Great Recession. The index turned negative at the beginning of October 2008 and then plunged. Weekly declines were between 3% and 3.8% starting in December 2008 through August 2009. Then the declines abated.

By comparison, real GDP during the Great Recession fell 2.8% year-over-year in Q4 2008, 3.2% in Q1 2009, 3.9% in Q2 2009, and 3.1% in Q3 2009.

The chart below, which covers 2019 and 2020 so far, shows the plunge in economic activity by week over the past five weeks. Before it all started, the economy wasn’t all that hot, with diminishing growth rates last year and into this year. For the week ending February 29, on the eve of the lockdowns, the WEI was at 1.58%:

The WEI gives us a feel of what GDP might look like in this new economy. The Great Recession, with GDP declining at less than one-third the rate indicated by the WEI, was bad enough. Today’s 11% plunge in the WEI points at a recession that would be three times deeper than the Great Recession, if the WEI persists at this level.

These are the 10 data series employed by the WEI:

  1. Redbook Research: weekly same-store sales
  2. Initial claims for unemployment insurance
  3. Continuing claims for unemployment insurance
  4. Staffing Index by the American Staffing Association
  5. Rasmussen Consumer Index
  6. Raw steel production (from American Iron and Steel Institute)
  7. Electric utility output, excl. Hawaii & Alaska (Edison Electric Institute)
  8. US fuel sales to end users (NY Fed calculations based on EIA data)
  9. US railroad traffic
  10. Federal withholding tax collections (Booth Financial Consulting)

The initial claims for unemployment insurance alone appear to be on a similar “three times worse” trajectory, pointing to an increase of around 25-30 million unemployed, compared to an increase of around 10 million unemployed during the Great Recession. So in terms of depth, not duration, “three times deeper than the Great Recession” might be a useful approximation until more data emerges.

Helicopter Money for Wall Street and the Wealthy: $2.06 Trillion in 5 Weeks. Regular folks, forget it. Read… Fed Massively Tapered QE-4. Hasn’t Bought Any Junk Bonds, Was Just Jawboning

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  387 comments for “How Far Will the U.S. Economy Plunge During Lockdown?

  1. Joe says:

    One other thing missing is the nasty mic ugly colder weather. Warmer weather would have a lot more people inching to be out and about.

    • CRV says:

      That’s a local thing. Here in The Netherlands we have had a unusual dry and sunny march and april. And you’re right, people tend to go out more. Especially in the weekends. Sometimes the crowds get too large.

      • dr_doomz says:

        Do people read the articles any more. This one is titled, “How Far Will the U.S. Economy Plunge During Lockdown?” Not one on-topic comment?

    • Rally Pig says:

      I suspect that the planet is cooling due to the global reduction in co2 emissions. Last two weeks the temperature dived in the Northeast US.

      No one is driving, less co2 produced.

    • Mike says:

      On the plus side, this latest heat wave (in CA) may more rapidly destroy viral particles on objects. It may reduce the R0 of this virus.

      In some comments, I did not distinguish the CFR from the IFR, forgetting the difference. I hope that the number of deaths among all infected NYs is really much lower than other reports indicated due to underreported infections. Maybe the virus mutated in NY?

      Otherwise, I am anxious for some of my relatives, who live in states that are reopened or reopening. At least, the US should have many more ventilators now. If we only had more personal protective equipment.

      • Mike says:

        I was interrupted:

        If these reopened states have spikes, fear may drive the economy much lower. I hope I am wrong.

  2. Pro-Establishment says:

    It’s a global impulse shock. 2nd derivative of sales. I’m experimenting with different ways of calculating and graphing internally for my employer based on our sales data, wish I knew how to graph it for the whole economy and for sectors.

  3. timbers says:

    Now all the Fed has to do if figure out how make oil to up to $100 and the stocks will follow. Follow probably to 30K at least.

    The economy doesn’t matter in Fed World. Only the stocks do.

    • Shiloh1 says:

      False flag tanker sinking in Persian Gulf? Mnuchin and Powell masquerading as Somali Pirates?

      • char says:

        The demand drop is to big for that. Would lead to even lower prices as strange as that sound. In the near term the world does not need gulf oil

      • timbers says:

        Good point. And your point underscores how we’ve been trying so very hard to start wars with oil states (Ve, Ir, Sy, etc).

        Somebody should tell you-know-who that the oil he’s “secured” in the ME isn’t worth anything and in in fact likely seem to be costing us money.

        In more ways than one.

    • CRV says:

      Could be an insurance fraud thingy. Sinking the ship with its content might be more profitable then delivery. [Just speculating].

    • Jdog says:

      Of course the economy matters. If you think it doesn’t you are going to have a very rude awakening….

    • DV says:

      Very relevant comment. The US stock market has been historically correlated to WTI price. And until that one recovers, there is no recovery in sight for the stocks.

      What can resolve the issue? Well, some Middle East war should come very handy. It is an area which is little relevant for the world economy other than oil and gas. So, as things look now, some kind of war there looks as almost inevitable.

  4. Morty Mc Mort says:

    Wow – Wolf – Consistently Amazing Analysis… thank you.
    Analyse the new “Terrain” and then identify opportunities.. Use Innovation Strategy and Micro-Innovation to find, test, and scale successful models…
    I love your work.

  5. ThePetabyte says:

    In regards to the real time data you say we need, what you are suggesting could theoretically be solved by tracking all pieces of data using blockchain.

    • char says:

      Why add blockchain. Makes it only more complicated.

      • Thomas Roberts says:

        Blockchain is only needed for things like bitcoin and other cryptocurrencies, because, it validates the transaction.

        Using blockchains is just a pointless and wasteful idea for almost everything else.

        • cargoman says:

          FYI, the cargo shipping industry has already begun tentative steps toward using blockchain. This was begun well before the pandemic, in the past year or two. It is NOT being used for payment, but rather for tracking/authentication, with the goal being ultimately to replace paper bills of lading.

        • A Citizen says:

          Cargoman, beware IBM sales people bearing gifts.

        • AJ says:

          it is intended to make it possible to tax the gray and black markets

    • A Citizen says:

      “Tracking all pieces” of statistical data using blockchain is thermodynamically impossible, even if blockchain technology was suited to the task, which it is isn’t. Not even close.

  6. Iamafan says:

    I’m sorry but whether you like it or not, the corona virus is the pin that popped the bubble, globally. So unless we have some plan of dealing with it that is well understood, then we will be in cloud nine for a while.

    We do not enough details on the virus at this time. But we have knowledge about other types of past viruses and the concept of herd immunity.

    In my opinion, the goal is HERD IMMUNITY (at least conceptually at this point). Since we don’t have a vaccine or have no realistic date of having an effective one, we can only think of getting herd immunity through infection and surviving whatever disease it causes. At least about 80% of the population should be infected!

    If you don’t think herd immunity is the goal then you better start praying because you can expect this virus to come back again and again (maybe even from overseas).

    So tell me, who is the government willing to infect if there is a stay at home order? Young grade school kids can’t even begin to cross-infect each other even if they are not that susceptible to getting a disease. Same is true for young workers. The risk of dying is very low.

    Testing, testing, testing. All we can hear is yelling. But no one has told us WHAT IT’S FOR? If the only group of people who are at appreciable risk are old and sick people then why not concentrate on protecting them, while allowing the rest of the population to cross-infect to get immunity?

    But so far no plan, just confusion. The old can hibernate for 1-3 months until the young has developed herd immunity. They just need some help from the government. Most of the old are already in social security and medicare anyway. Just make it better for a while.

    • td says:

      To get to herd immunity, you need to infect about 70% of the population and possibly more. People who are both young and healthy (no co-morbidity) are only about 40% of the population.

      Many of the 20-44 group are obese, have high blood pressure, diabetes and so on. To get to that 70%, you have to infect a chunk of the population that will definitely have a > 2% rate of serious disease, significant mortality and many cases of long-term damage (COPD, kidney disease, etc.)

      There is no simple answer here.

      • Iamafan says:

        I had all the above before (obesity, very high blood pressure, and diabetes) my stroke. I survived. I’m also old and on medicare.

        • FromKS says:

          You should study how probabilities work.

        • Iamafan says:


          I did. I took a lot of masters level statistics courses at Rennselaer Polytechnic Institute at Troy, NY.

          Must be good enough for P. Volker’s dad.

          Care to identify yours.

        • DawnsEarlyLight says:

          I value your experiences with survival, rather than your umpteen Stat courses.

          Live long, and prosper!

        • NoEasyDay says:


          I know how you got old, but I’m curious about your obesity, very high blood pressure, and diabetes; how did these comorbidities come about? Most of the older workers I knew brought a lunch from home, and they didn’t digest so much processed sugar. They didn’t charge everything either preferring to live modestly, change their own oil, mow their own lawn, etc., unlike the younger folks today.

        • goak1 says:


          I drive a blue f150 and haven’t had CV-19, therefore driving blue f150’s keeps you safe.

          That’s what you’re basically suggesting.

      • kurt says:

        its worse than that… we don’t know: permanent damage to body tissue after recovery. This disease causes scarring of the lungs and attacks the heart and circulatory system. even if not in the low risk group your health is at serious risk.

        we also don’t know: can you get the disease again AFTER recovery?

        Also: who is going to volunteer to expose themselves? No me no thank you.

        • Happy1 says:

          This is not accurate. The majority of the people who get COVID19 do not require hospitalization, and people under 60 and without comorbidity are at very low risk of serious illness.

        • Happy1 says:

          Low risk isn’t no risk and I certainly want to avoid it. But odds are strongly in your favor if you are young and healthy.

        • Craig says:

          We do know you can get it again. After recovery. Theres plenty of research articles about the reinfected.

      • char says:

        Herd immunity takes a very long time when people take voluntary, active measures to not get sink. Like when bosses want people to work from home, people don’t go out clubbing, buy everything not at the mall but from the web, etc.

        Exterminating the virus with a lock down is faster and cheaper than getting herd immunity

        • Thomas Roberts says:

          A lockdown doesn’t get rid of the virus, it only slows down new infections. In some small countries like South Korea, It is possible for a lockdown to be combined with weeding out infections and large scale testing and possibly completely wipe out infections, but, unless your borders are completely shut and there are no hidden carriers a new break-out will occur, if lockdown ever ends.

          But, for a large and well spread out population like the United States, this method is almost impossible under current conditions.

          The only solutions are to develop a vaccine, possibly rushed, which is the only true end to the CCP19 Saga or face it head-on and develop herd immunity.

          Herd immunity requires enough people to develop an immunity to the virus after getting it in order to prevent the virus from spreading easily, how many need to get it, depends on the particular society and how contagious the virus is “probably 80%+ in this case”. A major issue is that potentially, this virus can reinfect people after awhile and herd immunity without vaccines might be impossible. It’s possible this virus, could become a seasonal virus that comes around every year, until a vaccine is developed. If this is the case though, every time you get it, it should be less dangerous to you, but, you can still infect others. As you age though, even if you had it a dozen times, towards life’s end “or if you get diabetes or another health complication”, it could become more dangerous again.

          In order to minimize deaths either everyone with a high death risk has to remain in lockdown until a vaccine is developed or a medical treatment which greatly reduces death rate has to be found.

          If those with a high risk remain in lock down, there could still be breakouts in environments like nursing homes and cruise ships among those who aren’t immune, even if herd immunity is achieved in the general population. Only a vaccine or everybody facing it can truly end the CCP19 Saga.

          Right now if America/Individual states end the lockdown there will be a new larger “higher total amount of infections” slower “percentage wise increasing per day” wave of infections if CCP19 is as dangerous as its thought to be. But the many consequences of not ending the lockdown, could be far worse.

          So ultimately, My would be plan is until a safe for all vaccine is developed and distributed. People coming in and out of the country would continue to be restricted for awhile. Some people will volunteer to be human guinea pigs to test all possible medical treatments until one is found. The ability to produce all Pharmaceuticals needed for America in America needs to be a national priority, as well as certain other things like masks, hazmats suits, and medical equipment. There are currently over 100 vaccines in development, some early vaccines might not be 100% effective or maybe not always 100% safe, but, if it overall improves their safety, it can be made available to those who would be at high risk. Some things like sporting events will have to remain closed to the public and can only be watched on TV. Some Very large gatherings like Disney World and Large cruises will have to remain shut down. Everything else that I can think of remains open. In many environments like stores, factories, and airports, common sense requirements to minimize risk, while keeping everything going will have to be followed “especially by employees, these may be updated as everything progresses”, these rules should be uniform across the country. Those who are at high risk, until a solution is found, if they aren’t retired can get unemployment, if they choose to remain in lockdown.

          As for deciding lockdown rules presidents/governors will have no say in anything period, ever. Ideally the CDC can decide small things like safety rules in factories/stores/airports by itself, for bigger things the CDC will suggest them and then congress has to decide and finally the public has to agree to it.

          As a side note: I think the heads of larger government agencies like the CDC should have to rise to the top before then being voted in by the public in some fashion.

      • roddy6667 says:

        Whenever a city does extensive testing, they find that a lot more people are testing for antibodies than they expected. It appears that a lot of people are asymptomatic, many have mild versions that didn’t require visiting a doctor, etc. In other words, the numbers contributing to herd immunity are much higher than would be expected by using only the patients who were hospitalized.

        • Frengineer says:


          That would be a very good news indeed and I wish that were true. However, a very serious study from Pasteur Institute in France estimates that by May 11th (announced end of lockdown in France) only 5,7% of the French population will have been in contact with the virus. We’re still far from the target.

          Another sobering consideration is that it appears that not everyone who gets infected actually develop a substantial immunitary response protecting them from reinfection, hence making the whole herd immunity concept harder to reach for that coronavirus… but let’s not breathe in all the doom all at once :p

        • mtnwoman says:

          I wonder how specific those tests are? Perhaps some of thos positives are picking up regular ol cornonavirus (colds).

    • Karen says:

      It looks like we’re going to have the worst of all worlds—a huge economic impact from the shutdown, AND escalating death and disability from premature opening. We really screwed the pooch by not acting early to nip this in the bud.

      I tend to agree that a lot of younger people will want to try to get it over with. Would be nice if there was a kids’ quarantine for this purpose so they can develop immunity without infecting their elders. It’s not so much the old folks who have to worry—they are more socially isolated anyway. It’s the vast swath of folks aged 40-65, who have a lot of responsibility in society, that we have to worry about.

      • Ed C says:

        Chinese deceit explains some of the late response. Shutting down travel from China was timely. Not shutting down travel from Europe was a problem. These are unprecedented times. Finger pointing and playing the blame game isn’t real productive. Population density, as in NYC and other NE cities, is a problem … that no one can be blamed for. Riding the subway, buses, elevators are all risks that are just part of life (and now death) in the big city.

        • MCH says:

          Cause the Europeans, and most of the rest of the world didn’t want to do what the US did and be labeled in the media as such. There is a reason why the epicenter in the US is not on the west coast. There are just so many more direct flights to the east coast from Europe,

          As the dwarf in Warcraft III would say: “they came from behind.”

        • char says:

          In what way deceit?

          It is not the fault of the Chinese that the Americans f*cked up

        • roddy6667 says:

          You can fly into Heathrow and you will not be tested. From there you can go to any location in England, Scotland, or Wales. Nobody is checking. About two weeks ago, some American citizens were being interviewed by a TV station at JFK. They had just fled the debacle in Italy. They were amazed that nobody checked them. They just went through customs and right out to the concourse where you get a taxi. Most of the cases in NYC are of the European strain.
          Somehow this kind of thing is OK, but everything the Chinese do is at fault.

        • Tom says:

          Eddie C……..You say, “stop blaming others, it’s no ones fault.” But open up your comment with, “The Chinese deceit” and imply it was the Chinese people’s fault when Italian and German Govt’s with “open border” mentality allowed the disease to spread to its people then in turn these Europeans started infecting others in large numbers in Europe and abroad….But somehow on this forum, there alwsys seems to be alot of blame on Chinese people inclduint Amercian real estate bubble. But neglect to mention t large American REIT’s coming in buying up distressed property’s by the thousands during turks like this and especially during Finacial Crisis of 2008 for pennies on the dollar while the avg American lost their homes. And now these large REIT’s are making off like bandits. Also Russian, Indian and wealthy Brazilians bought up a the of property in America as well but we rarely hear about them. I’m not Chinese but I am getting fed up with a few people always trying to demonize the Chinese. Also if we Americans don’t like the Chinese buying up property in CA, NY and other states for very high prices, we Americans should not sell it to them at such a high price benefiting from those sales. Where is the pointer pointing against us Americana for being greedy and sellong those homes for such a high price creating the bubble?

        • Winston says:

          “imply it was the Chinese people’s fault”

          No one is blaming the Chinese people. The blame lies with their totalitarian government who covered this up early on and did things like ban travel from Hubei Province to other places in China before they limited flights from there to elsewhere in the world. That might have just been part of the cover-up or an intentional “we’re going to get very badly hit with this, so the rest of the world needs to also” sort of thing. A type of unconventional warfare as they have written about in the form of an accidental biological attack. They also covered up the original SARS outbreak with less catastrophic results.

        • IdahoPotato says:

          The travel ban to China is a joke.

          As per NYT on Apr 4, 2020:

          430,000 People Have Traveled From China to U.S. Since Coronavirus Surfaced. There were 1,300 direct flights to 17 cities before travel restrictions. Since then, nearly 40,000 Americans and other authorized travelers have made the trip, some this past week and many with spotty screening.

        • MCH, something like 60% of flights from China land in California. Including direct from Wuhan for MONTHS before lockdown. But look at CA stats. In addition, a CA University just sampled 2k people. Their results thus far suggest the infected count is 20 to 40 times higher than current estimates suggest, putting the death rate at… Boring flu. These results are hardly anomalous when you try to find actual data instead of “news” so… what’s going on?

        • Wolf Richter says:


          In the two months since Covid-19 has reared its head in the US, 48,000 deaths have already been recorded, plus some that fell through the cracks because no one was looking. Despite lockdown. This is just the beginning. Flu season, which is over thank goodness, lasts half a year. For now, we don’t know if Covid-19 has seasons or not.

          The flu doesn’t kill 48,000 people in October and November in the US. These comparisons are just nuts.

      • Happy1 says:

        This isn’t the worst of all worlds at all, mortality per capita in all of Europe is multiples of that in the US (Germany excepted). We cannot be locked down permanently, no country can. Europe is also opening up. On a per capita basis, we are far better off than almost all of Europe.

        As far as what happens now, it depends on how well people wash their hands and continue to avoid large crowds. The social isolation policies of the last several weeks were aimed at keeping our ICUs from overflowing. It was successful. But it can’t continue indefinitely anywhere.

        • Karen says:

          The jury is still out, but I think we will turn out to have one of the worst cases in this country, given our severely unequal distribution of resources.

          We couldn’t have eliminated it entirely, not in a country as large and mobile and diverse as this one. But we could have slowed it down to buy more time for a vaccine/treatment, and saved more lives with gloves and masks and intelligent physical distancing in the workplace. Look how quickly the homemade ones came along. But you have to tell people that it’s a good idea to have one, not lie to them by saying they don’t help (when the real reason is we didn’t have enough planning and foresight to stockpile more). In fact, we were shipping PPE to China in February.

          Totally agree that it was bizarre the US closed one set of borders early on (good idea) and not others (bad). And took temperatures (silly) when we already knew there was a long asymptomatic/infective period. That was useless security theater that just made people complacent.

          I thought a lot about these things in early February because my husband almost died of something that looked like coronavirus. We took all the precautions then, because the story was already full-blown in China. Sent my team to WFH in early March. I think the Chinese do bear some responsibility for hiding things (which they certainly did, to get the trade deal signed). But the US government bears even more, for ignoring facts that were already obvious.

          For personal reasons I would love to believe that immunity rates are as high as what Imafans citing for Chelsea. The rate of influenza-like illness in MA in December-January was unusually high and we live in that region…if my husband actually did have coronavirus I could worry less about his safety. Even with all that wishful thinking, I’m not quite convinced, given the contrary genomics work by Trevor Bedford, and the fact that half of the antibody testing kits are thought to be junk. It’s going to be a long road, regardless, for all the intelligent reasons cited in these comments.

          And extremely unfair to those who have fewer options to stay home and protect themselves. We should be focusing as much aid as possible on those households, but that’s the exact opposite of what our politicians and captains of industry want; they want to force people back to work so they can go on making money. They’ll oppose extending unemployment benefits. Blood money, I’d call it.

        • Karen says:

          Btw I’m not saying businesses should remain shut indefinitely, until we have a good handle on what the risks are and can control them perfectly. We won’t/can’t. I’m simply saying people should not be forced back to work in obviously unsafe workspaces because the alternative is starving to death. We need to approach this with far more compassion and intelligence and nuance than we have to date.

        • Craig says:


          Also Ireland has low cases and mortality. Despite sharing a land border with hard hit germany.

          All the countries that took strong decisive early action. Were able to start bouncing back in a quarter.

          Service exporters will be the first to recover. Since they can work at home and sell abroad.

          It also depends on remote work staying viable. Less travel means less accidents. Less pressure on hospitals. Less traffic. Easier for supplies to get through. Less panic buying. Less spreading as everyone jostled together.

        • Jackflash says:


          Ireland shares a land border with Germany? News to me.

    • Lance Manly says:

      Wow Iamafan, normally I like your comments. The whole idea of flattening the curve is to keep the incidence down to the point where the healthcare system can handle it. Meanwhile clinicians are working on controlled phase 3 clinical trials of possible therapeutics for the disease. Testing and contact tracing will extend the period until real and proven methods are developed to save people from disease. Heck South Korea has done this and have their cafes open. Now is the time to keep the incidence down and allow science to come up with mitigating treatments, not the law of the jungle.

      • Iamafan says:

        You think you’re smarter than nature?
        How do you think man survived for millions of years.
        PS. I’m not here to be liked. Thank goodness we don’t have up votes.

        • Lance Manly says:

          Actually scientists are a product of nature. The inquisitiveness into the realm of how things work turned out to make them more prolific. I am unfortunately not the best scientist in the world so I guess I am not smarter than nature. But I know using scientific methods we can produce incredible results.

        • dAvE says:

          “millions of years…” LOL, we’re a 200,000 – 300,000 year blip. The concept of economics itself a completely insignificant blip of the human era.

        • MarkinSF says:

          But only with antibiotics for about 100+ years. Before that almost any infection could take you out. Regardless of age.

        • Debt Wazoo says:

          > The inquisitiveness into the realm of how things work turned out to make them more prolific.

          No, not even close. We evolved big brains in order to scheme our way up the social hierarchy — read Chimpanzee Politics, Frans der Waal’s book about how “politics is older than humanity.”

          By a dumb stroke of luck one of our ancestors got a left brain hemisphere that could do math instead of being short term memory. Chimps have three times the short term memory that humans do — they can remember 15 particular checkerboard squares with a glance, the way we can remember 7-digit phone numbers. It’s theorized that this is done mainly with their otherwise-underutilized left hemisphere.

      • Orrin says:

        Lol just like science has conquered other coronaviruses such as the common cold? Modern medicine has very few answers against viral infections, especially ones that mutate seasonally. This isn’t a 110 minute movie where a tidy solution with a bow on top arrives in the nick of time. There is a several year cycle for drug development and absolutely no guarantees. I think you’ll be waiting a very long time (if ever) for a miracle cure. Probably far less time for a rather anemic, marginally effective but highly media-hyped vaccine supported by randomized controlled trials funded by….yup, Big Pharma! I sympathize with your concerns about the “law of the jungle” but the fact of the matter is that a very large portion of the population is going to have to confront the pathogen and mount an immune defense. This is unavoidable fact.

        • Happy1 says:

          There is no evidence whatsoever that this virus mutates rapidly like influenza. It is entirely possible that a single vaccine will be efficacious. We also don’t know if there is lasting immunity. Whole lot we don’t know actually, and speculation is exactly that.

          We don’t have vaccines for the viruses that cause the common cold because those illnesses are mild and there are many viruses, not because those viruses mutate.

        • char says:

          The common cold is mostly corona viruses and after we get one of those corona common cold viruses we, humans, don’t develop long lasting immunity to them. That is why we get it again and again.

          It is not certain that humans will get long lasting immunity from Covid-19. It is actually unlikely so herd immunity is useless.

        • Debt Wazoo says:

          The common cold is caused by rhinoviruses, not a coronavirus.

          Very big difference. Rhinovirus particles are tinier and their genomes are much simpler.

      • polecat says:

        How are we going to do real large-scale testing and contact tracing, when our Bickering Betters in D.C. can’t even send out relief ‘checks’ .. without f#cking up That rollout, as the plebians stare at the impending event horizon ??

        We have government by disfuction, for the sole benefit of zombie Oligarchs & big putrid Corps es. All of which need to be shot dead .. and put out of our misery !

    • Gandalf says:

      Early antibody studies of their local communities by Mass General, Stanford, and Colombia indicate positive antibodies to COVID in about 30% of the people, far higher than the known number of COVID+ cases.

      So that indicates the virus is already more widespread than testing for the virus itself has demonstrated.

      Whether the presence of antibodies means that these people are immune to COVID, and that they will not spread the virus to others is still unclear. For instance, about 10-25% of people with chronic active hepatitis B (meaning they still have the virus onboard and can infect other people with their blood/bodily fluids) will have antibodies to hepatitis B.

      As has been pointed out many times here, young people and middle aged people, do get COVID and die. One of the sailors onboard the carrier Roosevelt died. So did a French sailor onboard the carrier Charles de Gaulle. No old retired seniors onboard either ship, or people with serious medical diseases.

      As I posted before, the Spanish flu occurred during the last days of WWI, and the US blasted full speed ahead to rev up for the war and censored all news reports of the flu pandemic. 675,000 died.

      So that’s the extreme end of what happens if you don’t do social distancing, etc.

      We’re about to find out what is going to happen to Japan, with its densely packed housing and transportation systems, which also refused to do social distancing/isolation.

      • Gordian knot says:

        Chris Martinson blew that study to pieces it was mostly BS.

        • Gandalf says:

          I have no idea who Chris Martinson other than that he once got a PhD and now makes his money with YouTube videos about COVID and buying silver.

          Anybody who thinks silver is a good investment is an idiot. Once again, I would point out that over 70% of silver production is as a byproduct of mining for lead, zinc, and copper. Silver prices go UP when demand and prices for lead, zinc, and copper go DOWN, because less silver is produced. It is an inverted metals commodity, in other words. Not an investment.

        • Iamafan says:

          Go to the source of the peer review.

          Most of the questions are about the sampling techniques.

        • A Citizen says:

          Gandalf, oddly enough the miners find the investment in silver sound enough to fund the extraction of it and the financial markets trade it both physically, and via derivative products. Your simplistic explanation of silver’s pricing mechanism is easily disproved by even the most basic analysis of the it’s price discovery history.

        • Gandalf says:

          A Citizen,
          I don’t know if your Google search is sending you to an alternative universe, but my Google search of historical silver prices show that the twin peaks of silver price highs in the last 100 years were:

          $48.70/oz (not adjusted for CPI) in January 1980, when the Hunt brothers tried to corner the silver market. When they missed a margin call, silver immediately plunged to $11 an ounce.

          $41.48/oz (also not CPI adjusted) in September 2011.

          Quite a few LOWS along the way – here are the highlights:

          $3.58 February 1993 (start of the dot com boom)
          $9.50 November 2008 (early days of the GFC)
          $14.30 December 2015

          Silver is currently blazing along at the fantastically skyrocketing price of $15.14 as of today

          Don’t like the non-CPI adjusted prices?

          Here they are:

        • Gandalf says:

          Here’s another simplistic explanation: Silver tends to be found in ores of lead, copper, and zinc, especially in an ore type called electrum

          Lead and copper prices are roughly 100 times less, pound for pound, than silver. Zinc is roughly 10-20 times less than silver.

          If you are the owner of one of these lead, copper, or zinc mines, and the ore also contains silver you would be a fool not to extract the silver, even trace quantities of it.

          Even more expensive metals like platinum and palladium can also be found with copper ores, so you betcha these are going to get extracted.

          Platinum is over 5,000 x more expensive than copper per ounce, palladium about 20,000x more expensive.

          Silver is positively lower middle class by comparison

          Worldwide, about half of silver gets used up for industrial uses, electronics is a biggie – your cellphone and computer wouldn’t run nearly as well without it. Silver is a better electrical conductor than copper

          Hence the huge constant need for industrial silver in our modern world

      • Iamafan says:

        If you’re looking for a perfect solution, I’m sorry there isn’t any. Nature isn’t merciful.
        If you have ever been in a near death situation, you’ll understand me.

        • Gandalf says:

          I’ve seen lots of people die in my career, some peaceful, some incredibly violent.

          A man in his 70s dying of congestive heart failure. His son visited the ICU, said he had lived a good life. Later that night, the man drifted off to sleep, started that irregular Cheyne Stokes breathing, and his heartbeat slowed down, the EKG beeps became further and further apart until they stopped altogether.

          A 15 year old girl, brought into the ER with her head smashed in with a hammer by her boyfriend. Her head felt like a deflated soccer ball. She was sooooo clearly brain dead already, but everybody in the ER was standing around looking at us to save her, so the senior Neurosurgery resident ordered her up to the OR. I had to shave her head and prep it. That deflated soccer ball feel, never forget it. The senior resident made one stab incision, brains started to ooze out, like a pinkish cream cheese. He quickly covered it with a sponge, and then announced, “OK, we’re done!”

          Others, I sent off with written declarations of brain death in their charts, a few where I turned off the ventilator myself after a finding of brain death.

          I know death, I’ve seen it. It comes for us all.

          The question here is that it doesn’t matter for those with the means and ability to self isolate and protect themselves. For those that can’t, what are the tradeoffs? Is it worth it to jeopardize their lives?

          The captain of the Theodore Roosevelt felt differently from you. We are not at war, he said, and it did not make sense to jeopardize the lives of his crew. He got fired. His crew, packed like sardines into that ship, had no escape from being infected with COVID. Self isolation was not an option onboard. He did what he believed was the morally correct thing to do after his chain of command ignored him, and he went public. A courageous man.

          Nursing home patients are similarly helpless. The workers they depend on are generally low income Americans. Strict PPE standards are expensive, you know nursing homes are not going to spend money to upgrade. So, self isolating old people who depend on others is not an option.

          I suspect with all the protests and Libertarian streaks of Americans that self-isolation will soon be abandoned by a large portion of the American population anyway. I suspect the virus will rage on for months in those areas that do open up, and this will re-infect other areas that had gotten the pandemic under control.

          So, it doesn’t really matter what you or I think. This is all playing out before us, American style

        • David Hall says:

          The antibody test kits made in a China are suspected of inaccuracy.

        • Cas127 says:


          What are your thoughts about the two CA sero studies that suggest infection/post infection levels are already much higher than swab tests suggest (lowering the fatality rate markedly).

          I tend to agree with you that infection levels are going to rise – although i think that because true viral isolation is very, very difficult to achieve in the real world rather than because of political lobbying to “open up”.

          (Little asked question – does one delivery guy meeting 10 “at homes” really reduce infectivity relative to 10 grocery shoppers? I tend to think there is something like “The Law of Conservation of Virality” at work – meaning that alternative means of food distribution tend to have approx the same overall virality risks when aggregated.

        • Gandalf says:


          See my post below about the antibody study done by Mass General in the city of Chelsea which showed a 32% positive rate.

          Haven’t directly read about the California studies – if they are the Stanford study, WS seems to think they are bunk. See below.

          Antibody studies are bound to show a higher positive rate than nasal swabs and DNA testing for virus. The best numbers seem to be from S Korea and Iceland for large numbers of virus DNA testing.

          13% of Iceland tests were positive for COVID. Deaths at about 0.5%, slightly better than S Korea’s numbers which were around 0.65%. You could assume a three fold greater total number of virus exposures if doing antibody testing, based on the 32% number from the MGH/Chelsea study, and then then the total death rate would also drop by a third. Closer to influenza numbers, but still higher. But this is speculation until somebody actually does a big antibody study.

          Again, it is not clear that prior exposure to the virus and recovery means that you are immune. A growing number of S Korean patients that were positive, recovered, and tested negative, then re-tested positive again, and had symptoms.

          So, yeah, this is one tricky virus. I think people who want to open up the economy are going to end up prolonging and worsening the pandemic, for sure.

        • Tim says:


          The UK government are being criticised for not testing more widely.

          Talking to a colleague of mine in acute medicine, the sensitivity of the COVID-19 tests they have available is 80% they think, at best.

          Until something better comes along, lockdown is the only way to control spread. Indeed, it probably is at this stage no matter how good testing sensitivity and specificity may get in the next few weeks, for several reasons.

          But that will sound like white noise to many people for different reasons. Some because of their political views. Some because they just want an excuse to go out and earn for their families and they are too desperate to care about dying themselves of COVID-19.

      • Iamafan says:

        Where is the data and proof of further stay at home or shut down effectivity versus the cost? We already had at least 3 weeks of this. Maybe a mask and distancing is good enough.

        • char says:

          Voluntary isolation, what will happen if you don’t do a lock down, has also societal costs and it will last much longer than a lock down. IMHO the will be higher and more difficult to compensate for. There is also the missing GDP if you loose 1% of your population.

        • Jdog says:

          How do you figure the cost basis of death or permanent injury.
          It seems like a lot of people in this country have their priorities out of order. When you begin to put money before people, you have lost your humanity.

        • Craig says:


          Here’s the data.

          The main point is it can be spread by surfaces. You can pick it up then carry it home. Then you can pick it up again.

          The only way to reduce lockdown is to speed up testing and ventilators.

          A mask and social distancing and small gathering is not enough.

          Testing and shielding infected/high risk and minimising commutes as well as masks and social distancing could be enough.

      • Wisdom Seeker says:

        @Gandalf – Stanford did not claim “30% of population”, they claimed a few % … a value comparable to the poorly-known false-positive rate on their test … in a badly written overblown paper for which they were widely thrashed by statisticians worldwide. The authors also had clear biases.

        They had a few thousand test kits which could have been put to great use in a random-sample study, and instead they asked for volunteers on facebook. With poor-quality agenda-driven fake-science like that, we aren’t going to get anywhere any time soon.

        • VintageVNvet says:

          Very Good WS, as usual.
          Fact is folks that the actual ”science based information” re this virus is still lacking,,, sufficiently lacking so far, that there is NO proceeding on the basis of rational and reasonably accurate information.
          OTOH, as someone with an old but thorough education in the scientific method as known in late 1960s, I am both self isolating and using the best available (to me) PPE when I have to go and increase my liquidity, etc., and I do recommend everyone do as I do, and to heck with what anyone says, so far.
          I was saying here and elsewhere, Stay Home,,, but, clearly, that is not the right thing for many younger people, especially the cohort that has heavy responsibility for others, as mentioned.
          We, that is the family/imperial WE, are certainly ready to go out to our favorite restaurants, and will likely do so as soon as they open, but, other than that and reasonable precautions, not much impact for us, yet.

        • Gandalf says:

          Wisdom Seeker,

          OK, I retract my statement about the Stanford testing. I only heard about it (and the Colombia study) from another physician, did not actually read anything about their study or how it was done.

          Can’t trust those Chardonnay drinking Northern Californians anyway.

          However, I did read up in detail about Mass General’s study. MGH!

          Researchers from Man’s Greatest Hospital did a random survey in the Boston area city of Chelsea, literally going out on the street and taking a drop of blood from 200 random passerbys. 64 of those passerbys tested positive, which is 32%

          “Doctors used a device made by BioMedomics to analyze the samples. The test hasn’t been approved by the FDA, but Mass. General approved the device for use” – according to one article.

          If you check on google news the keywords “Mass General COVID antibody test Chelsea” you’ll find multiple articles describing the study and its implications.

        • Wisdom Seeker says:

          @Gandalf: Man-on-street is still not a random sample in this environment.

          Accuracy of any antibody test is still uncertain – what’s the control group? How certain can they be that the test spotted someone who actually had a SARS-CoV viral infection, given that there’s no other test for it?

        • Gandalf says:

          In the science/art of surveys, there is no such thing as a perfect survey.

          Even the Constitutionally mandated every 10 year Census is imperfect. And they try to survey Everybody, and still miss segments of the population

          Political polls have long known the difficulty of getting accurate random samples of 300 million people, and almost all polls adjust their raw data with internal modeling to produce a fudged number that they hope is accurate

          These are early days still, but we know for sure that this is a highly infectious virus that is asymptomatic or mild in most people. Common sense says that communities that had one or more early super spreader event and were slow to socially isolate are very likely to have large numbers of people showing signs of having been infected

      • Happy1 says:

        There is no valid study anywhere demonstrating 10-30% immune response to COVID19 in any population. A very preliminary study in Wuhan, the center of the epidemic, shows about 3% of the general population has had an immune response. Same for the very flawed Standford study you cite. We will have better data within weeks.

        • DrM says:

          How do you get better data without good testing? Or tests. The reagents are Made in China according to pharma. Many are not tested who are sick. Early days. No good response. Too much politics.

      • Kimm says:

        Your comments about the 15 year old girl were just unnecessary. Seriously.

        • Gandalf says:

          That was just one of many murders, accidents and other profoundly disturbing life ending or altering events in patients that I’ve seen.

          I have LOTS more stories I could share. Yes, I have seen death, lots of it. Dying from COVID pneumonia is not nearly as terrifying by comparison.

          Medicine is not like you see on TV, Grey’s Anatomy, etc. Try working in a Level I trauma center in a crime infested big city hospital sometime. Or worse, in that hospital’s Neurosurgery ICU.

        • NoEasyDay says:

          The dose of reality was sobering and relevant.

      • jm says:

        Testing in Iceland found only 25 to 50 % asymptomatic. Enormously higher ratios reported elsewhere may be due to false positives. Indeed, they make me very skeptical of the quality of the tests.

    • Jdog says:

      First, there is no herd immunity for this virus. You can get this virus again even if you had it before. The virus is a hybrid being part SARS and part HIV. The SARS component attacks your lungs, and the HIV attacks your organs, both leave permanent damage. If you catch it again, your system is already compromised and you are at even higher risk.
      Also the notion it is only people who are old and or already compromised in some way that are at risk is simply not true.
      At present the United States has 2 of its aircraft carriers out of service, that they are admitting to because of this virus, and the last I checked the navy is mostly young health men. I suspect the situation is probably worse than they admit. I know it was bad enough for the Secretary of the Navy to hold a press conference and warn other countries not to try anything because of it..

      • Iamafan says:

        If there is no herd immunity you better get real scared. The good thing is that no one has proof of anything. You think the virus will just disappear?

        • Jdog says:

          Viruses tend to mutate, and usually the mutations make the virus less potent and that is what causes them to die out. Hopefully this one follows that pattern.

        • Two schools of thought. This is a novel virus and any vaccine would need to be DNA based. If this is true then the virus probably will not mutate. It might disappear altogether. Say you hybridize a noxious weed and release into your neighbors lawn? By next year it’s gone. Good news, the virus is a bioweapon, unless it’s a really good one. There might be two or three iterations programmed in? If its conventional there is immunity and a vaccine. Eventually that virus mutates itself away from an effective rate of infection, looking for an opening. If it was a bioweapon the logical inference is that some outside power dropped the virus in Wohan to make it look like an accident. You don’t aim the cannon at yourself, and there are no accidents.

        • Debt Wazoo says:

          > mutations make the virus less potent and that is what causes them to die out.

          No, the mutations make them less deadly and more chronic. After all, keeping the host alive and shedding is in the virus’s evolutionary self-interest. HIV is the grand daddy champion here.

          This also fits with those early horror stories coming out of Wuhan about neurological symptoms. There probably were some horrifically lethal strains early on, but the strains that keep the host alive spread much faster, “squatting on” all the available hosts.

      • Happy1 says:

        This is BS. No one knows if there is lasting immunity of not. And this virus is totally different from HIV. Please don’t pollute this forum with crap.

        • Cas127 says:

          Maybe we should have comment voting…

          While there can be well thought but nevertheless controversial posts, there are also more than a few posters here who seem to enjoy panic trolling for no reason other than personal…pleasuring.

          Upvoting/downvoting would tend to id habitual bad actors.

        • Tim says:

          Maybe, in addition to up and down hand signs to indicate voting, we could have a pair-of-short-round-and-hairy-ones sign, just for the really special posts :)

          ( fully understand I may become a victim of my own idea there)

        • Jdog says:

          There is very little immunity from any virus, that is not how it works. If it did, don’t you think you would be immune from the common cold by now? And no one said this virus was HIV, it does has similar elements. In addition to the respiratory damage, it attacks the vascular system causing organ failures. Do a little research, so you can make posts based on something besides opinions.

    • MCH says:

      Testing is important, but so is having the right treatment options. Because in reality, that more than anything will get the economy opened up faster. What good is testing if the option is then to just shut all the near by things down again.

      Having a treatment like Remdesivir or something similar is the way to go. But at the same time, you really can’t wait for the darn things to go through all of the clinical trials.

      In the long run, the sooner they open things up the better. Right now, this plan to “let the data guide us” is equivalent to slowly dialing up the temperature, and boiling the frogs inside. Until we get to an irrevocable decline where no amount of Fed intervention will help.

      • char says:

        You test to know who should isolate. Not only the person you are testing but also the people who may have infected him or who he may have infected. This allows all those persons to not infect other people so the virus will die out.

    • DrM says:

      To get herd immunity you need immunity. So far there is no proof there is immunity.
      The virus is mutating which may make a vaccine difficult. If you can make an effective one.
      This is a very bad virus. It’s NOT the flu. The numbers are higher; there are few tests and there is a dearth of PPE. Many people have it and it is not reported. Some are very sick.
      In my partner’s hospital the nurses are allowed ONE mask a day.
      Many are NOT taking this seriously. And will there be long lasting damage? Do we clear the virus?
      We don’t know.

      And the Federal response has been or rather has not been.

    • sunny129 says:

      So far there is NO evidence of development HERD immunity ( on a permanent and NOT transient) any where in world, so far!

      A recent report from China suggesting 33 strains of mutated strains of corona virus out of which 19 are apparently new. They suggest the strains of virus affecting the morbidity and higher mortality rate in Italy and NY are related to these new strains. Some of these carry 270x virus load compared to weaker ones!
      You can already expect how difficult to develop the vaccine for all these strains!
      A lot of unknowns at this point every one blindly groping for some thing in the darkness! Go Figure!
      (MD, retired)

      • Lisa_Hooker says:

        Nextstrain has catalogued 3163 discrete genomes of the virus as of mid-April.

    • Dave says:


      I agree that, “We do not enough details on the virus at this time. But we have knowledge about other types of past viruses and the concept of herd immunity.”, yet we know that we should lock down the world and destroy lots of lives. How does that work?

      The supposed cure may be worse than the disease. Sweden seems to have taken a much more pragmatic evidence based approach in dealing with Corona/Wuhan/Covid rather than out of fear and computer simulated forecasts that are based on models that may/may not make sense. Some of the forecasts of deaths from the virus have already been scaled back significantly.

      When I go out and see so many small businesses shut down, I feel sorry for those owners and their families.

      There are probably people high up that didn’t want the lockdown put felt the peer pressure to go along with the “program”. Who says kids and teens are the only ones that feel peer pressure.

      People are focused on the economic damage but their will be lots of psychological damage that will also affect the economy. The latter damage is harder to forecast or calculate.

      I’ll stop there.

    • Engin-ear says:

      I am happy to hear it.

      Testing is necessary to detect the moment of 70% infection.

      May it happened already, how do you know?

    • Craig says:

      Herd immunity simply does not work. That’s why the UK abandoned it quickly. Herd immunity is like trying to boil water in a chocolate kettle.

      Your right about the virus coming back from overseas. That’s why countries have closed their borders. New Zealand even restricted inter region travel.

      All the countries with widespread testing. (austria,germany,south Korea,Vietnam) are able to recover earlier. They also have a much shorter (albeit) sharper economic issue. With an earlier recovery. The more masks/tests/ventilators outpace demand. The quicker the recovery,

      The 4 high risk groups are a) anyone who has been in contact with anyone who has the virus. or even in the same area the next day as an infected person.

      B) the elderly

      C) the sick,immuno compromised,disabled

      D) people in large crowds or on the front lines (hospital staff,etc)

      Group b,c,d are fairly easy to identify. The only way to find out A is with wide spread testing. At that point you can reduce the lockdown to specific households.

    • AJ says:

      the seems to be exactly what Sweden had in mind, and so far it seems to be going as they had hoped

    • Shawn says:

      Herd immunity make no sense when the virus mortality rate is anywhere from 5 to 10%. For example, West Africa has a population of 381 million people, herd immunity (95%+) for ebola would have meant 130 million people wiped out. It wouldn’t work. The only way forward is a vaccine. Preferably a vaccine that will not only protect us from this years SARS-2 but also next years (or the year after that) SARS-3. Otherwise, get use to the economy we have now, or rather, the economy described in the article above. Or maybe we will get lucky and the virus will just run its course like SARS-1 did.

  7. John says:

    I’m hearing short recession. Quick recovery. Maybe anti body medicine by sept. Vaccine isn’t till next year. A.G. Baird suing states about overbearing lock downs. I’m in a reit. One I wanted 20 years ago but couldn’t touch it. I’ll ride it out. It has some shut down malls by you in San Fran.

    • rhodium says:

      Maybe fundamentals don’t matter in stocks, but what rational reason is there to believe that companies will immediately hire back their employees? They’ll wait for demand to show back up before they hire back, except it won’t because so many people are suddenly broke. Maybe if they had savings, then demand wouldn’t fall so much and companies would be forced to hire back quickly.

      The fed along with congress could temporarily hand out more money to people and create *fake* savings. That might help rebalance, but there’s also the issue of all the zombie corps that could go under in the meantime. The paychecks that came from those won’t come back, so you’ll find yourself at a new lower equilibrium until the Fed can blow a new bubble economy. That usually takes a few years at least.

      It is incredibly unlikely that we just pull out of this and go back to how things were.

    • Kasadour says:

      I don’t think it’s going to be as quick as that. COVID19 is showing a resurgence in Italy, and positives are up in New York today. Whether antibodies will create immunity is not a given; as a matter of fact it’s UNKNOWN whether antibodies render those recovered immune, which complicates the development of a vaccine. 100s of so-called recovered persons are testing positive again for COVID19.

      The shopping habits of US consumers have been broken. The retail industry is collapsing, and many other industries are needing a bail out.

      Now core parts of $1.7 trillion US corporate bond market have been targeted by S&P for downgrade from AAA to CCC with massive repricing to follow, and guess who is hold billions of that worthless paper? The Federal Reserve Bank.

      There are simply too many industries in need of liquidity.

      Sad but true. I just don’t see it turning around on a dime.

      • Happy1 says:

        Covid19 is NOT showing a resurgence in Italy, it is continuing on a path at a level lower than peak. And daily cases in NYC or anywhere else are based on reporting that varies widely, hence moving 3-7day averages are better.

      • MC01 says:

        Kasadour, let’s clean up some problems about Italy.

        Yesterday there were 43 new cases in my province, but of these a massive 29, or a tiny bit over two thirds, were nursing home patients. And that’s Italy’s present big big problem.

        Since testing capacity is now available in quantity and since new cases are slowing down as fast as the most optimistic predictions said, we are now testing all nursing home patients, starting from those with dementia and speech impairments who cannot answer the set of questions physicians now ask to all suspect Covid-19 patients to decide if they need to be tested. And it’s an absolute tragedy: we have nursing homes with infection rates as high as 60%.
        All nursing homes throughout Italy went on lockdown on February 21 already: this meant no visits period, keeping patients separated, staff wearing facemasks and gloves at all times etc.
        Just like all other lockdowns it didn’t do a lick of good and the witch hunt is now on.

        But wait, there’s more! Mortality is slowing down much faster than anybody expected (just two deaths yesterday: both had been hospitalized for over 30 days), and patients hospitalized two/three weeks ago have much higher and faster recovery rates than those hospitalized in the early phases of the emergency. ICU’s in my province are now at 50% capacity compared to just ten days ago and the first Covid-19 wards closed on Sunday due to the best possible reason: lack of new patients.
        To add to the confusion all new cases yesterday were too mild to require hospitalization: they will be quarantined at home.
        We’ll have to wait to draw conclusions but nobody expected the virus to get into nursing homes the way it did while at the same time to be losing virulence so rapidly.

        Our new experts expect the virus not disappear suddenly or to have one big resurgence down the road but to have a “long tail of isolated cases and localized outbreaks”. The virus won’t probably be completely beaten even by effective vaccines but it’s likely to become endemic/dormant in some areas like MERS is in the Arabian Peninsula or bacterial meningitis is here.

        This is what we know right now, and it’s subject to change obviously. I am sorry if it’s not the doom and gloom some outlets promise but even the Antonine Plague only managed to kill off 25% of the population of Rome. Extinction will have to wait a bit more.

        • Kasadour says:

          Which province? My husband and I bought a small house in the village of Palata which is just a few kilometers outside of Vasto in the Chieti province on Italy’s Adriatic coast.

          Thanks for the info. There is a lot of information out there to choose from and digest properly. I’m glad to hear it isn’t as bad as I thought.

          My main point is that I don’t see a quick turn-around in the western finance economy that was already sick to begin with. We’ll know more once the unofficial GDP-now number is released.

        • MC01 says:

          Kasadour, the province is Brescia one of the worst affected areas in the world. Now wverybody knows where we are but just like Wuhan all for the wrong reasons.

          If you want more number crunching yesterday we had 13 new cases: the results of nursing home tests are delayed so they’ll be released today. No deaths yesterday here, but there are still many people in grave conditions so that is bound to change.
          Everybody is extremely surprised the virus is losing steam so quickly while four weeks of lockdown made no dent on it: it’s suspected that like all very aggressive viruses (and look at nursing homes: this stuff spreads as aggressively as rhinoviruses, the cause of the common cold and one of the most aggressive virus families known to man) it’s either killing off all potential hosts or is mutating in a milder form. But only time will tell: all the data we got from China about this virus is basically junk, including evolutionary studies, and we had to restart from scratch.

          Speaking of good news yesterday the Federal Ministry of Health fast-tracked a COVID-19 vaccine for clinical trials in Germany. At this point if vaccines are so vital it’s useless to waste more time: just trial them, see if they are effective and put them in mass production right away. And OMS/WHO procedures be damned: they can advise their paymasters in China now.

          Want more good news? Italy will reopen for business on May 4, but next Monday already many restrictions will be lifted. I was just on the phone with one of my contractors and he’ll be here “as soon as I know I can work”. Book early folks. ;-)
          We’ll have the details over the weekend but it seems by May 18 90% of the country should reopen. Today the EU will start working on a tentative plan to reopen all internal borders and those with Norway and Switzerland and restart airlines in June already: the big problem right now is Spain. By July the “new normal” should have already started and I hope by October-November things have calmed down enough for me to take a loooong ride in Spain. I am possibly itching to ride as much as I am itching for a good haircut…

    • Wolf Richter says:


      I see deep recession and a painstakingly gradual recovery not back to the old normal, but some kind of new normal where a lot of things will be different — including consumer preferences.

      Malls will need to be redeveloped into other property types, mixed use, offices, housing, etc. This is already happening in SF. How many restaurants do we still need in San Francisco? We already have 7,000+ establishments (including delis, cafes and the like). There will be a surplus of office space, now that the world discovered that working-at-home really can be managed…

      • Phoenix_Ikki says:

        Funny how it took so many companies so long to figure out remote work is possible and probably would save them money in a long run (office lease, equipment cost) not to mention employee well beings. I hope the next to go is those trendy super open office space design, talk about a super effective way to spread virus around. Another trendy concept that is pretty A$$ backward when it comes to real benefit. Hopefully CV19 will do us a favor and kill that one for good too.

        • Shiloh1 says:

          Hat tip to McKinzie in collecting bazillions for convincing insurance businesses, including the 2 in their namesake 100 story Chicago buildings, that they needed open office designs like a 1999 dot bomb company. Oh, both CEOs are xMcKinzie!

        • timbers says:


          So true. Company I work at literally just completed conversion to “open space” office seating. And with no assigned seating, it’s first come, first serve. Close seating, no wall separation.

          Perfect Covid spreading ground.

          And, what they replace was close to perfect Covid repealing: Walls, separate cubical, assigned seating, great distance between seating.

          It’s like they planned to throw away all that renovation money.

        • jgoak1 says:

          The hapless, low-talent management ranks will oppose WFH since they like to keep their minions close. Hopefully there will be some more forward thinking views that will see the great positives in WFH.

        • Lisa_Hooker says:

          Another great thing about WFH is that they can just send you an email informing you that your position has just been eliminated and you will receive 2 weeks severance. Please return your laptop using the enclosed shipping label. We will send your check when the laptop is received.

      • MCH says:

        I’ve heard of the new normal back in 2009; where flat revenue was the new growth, and down < 5% YoY was the new flat.

        Those were the days.

        But as for restaurants in SF, we still haven't outpaced NY, I wonder if there is a per capita measure there.

        At the end, this entire C19 thing is either going to be the end of the world because the world is too terrified to come out of its hiding place, or it really is so virulent that social distancing is the only thing saving all of humanity. I'm going to vote for the former, mainly because the latter is just too difficult to contemplate, and also doesn't seem sensible anyhow.

        • AJ says:

          social distancig is what ended the Spanish flu. And we had a couple large cities, one with 6 ft, one with 10 ft, and the 10 ft spacing was more than 2x as effective in slowing spread. Do we have to have 50 million deaths for people to wise up about it?

      • Tony says:

        Malls can be bulldozed for new housing. Office towers? Not easy to covert to apartments, plus as others have noted, the commercial rent cashflows are spoken for in the form of REITs and bonds etc, with the whole thing being theoretically regulated by the SEC, which is not set up to become a landlord.

        What I haven’t seen data on and am curious about is how much of American’s hoarding, wise and unwise, is on credit cards that might not be paid off? Heard people discussing in line at Safeway “We won’t have to pay these credit cards, the governments gonna do something.”

        What if people who are broke, or almost broke, or even solvent, simply cannot or refuse to pay off the cards? Or rent, or mortgages, bills, taxes, etc? Could they leverage that third crisis, Covid19, Economy and refusal to pay anything into political and economic change?

      • Dan Romig says:

        I wonder what the new normal will look like for pro and collegiate sports. Will fans want to go to games and sit side-by-side in a crowd of thousands? Same for concerts and theatre.

        The Minnesota Orchestra is scheduled to begin the 2020 – 2021 season at Orchestra Hall on August 13. It will be interesting to see how this evolves, and if it ultimately happens.

      • DrM says:


        How do you factor in the debt, job loss, and the money printing to name just a few things and get a recession and not a depression?

        Companies especially oil have so much debt as does the populace. Student debt, auto, home,
        Credit card. We are a service economy. We will have to revamp things to make America the great country it was and I see corruption and financialization and greed as well as lack of good leadership.

        Make me feel better cause I sure am nervous.

        • Wolf Richter says:


          I’m really worried about all the debt and the money printing. Something is going to break — but I don’t think it will be in the near future. And that’s the problem. Every elected officials feels safe because it’s not going to break before the election.

        • Pro-Establishment says:


          Do not be fearful. 100+ years experiences shows that the USA always bounces back with vigor. Americans embrace creative destruction, this is why we are resilient. A great example of this was Washington Mutual which died in the last crisis. People thought it was the end, but the banking system and home prices recovered in not many years, stronger than ever.

        • Wolf Richter says:


          “but the banking system and home prices recovered in not many years, stronger than ever.”

          Because the Fed printed $3.5 trillion and cut interest rates to zero, wiping out the income streams of $10 trillion in savings products and of $15 trillion or so at the time in Treasury holdings. It was the biggest wealth transfer in the history of mankind, from the many people over here those some people over there. Proud of this wealth transfer??

        • Pro-Establishment says:


          This is glass half-empty stuff.

          Suggest you think about the unemployment and misery that would have happened if the FED hadn’t performed it’s function here. Interest rates could have shot up who knows how high, leaving an entire generation of homebuyers underwater forever. And most small businesses depend on banks to operate-bye bye businesses and therefore jobs. You wanna complain about deficits- what would the annual interest expenditure be if the govt had to borrow at 21%? It’s ugly to think about the alternatives.

          We can still work together with our leaders to improve things even more as we work through the current crisis. The recent increased support for small businesses from Congress is encouraging.

        • Wolf Richter says:


          That’s raging propaganda BS and you know it.

          The government (FDIC) can “resolve” a bank that is toppling by taking over the bank, wiping out shareholders right off the top. The FDIC then runs the bank, and more or less gradually sells the assets, such as Treasury securities, loans, mortgages, buildings, etc. In total, there are now about $20 trillion in assets at US banks. Selling a bank’s assets covers most of the liabilities, and most of the creditors at the top of the capital hierarchy will be made whole.

          If the assets do not fully cover the liabilities, the remaining creditors, depending on their position in the capital hierarchy, will get some of the money back but not all. This includes unsecured bondholders and depositors. But depositors with balances under the FDIC limits are insured and get the money from the FDIC. So they will be made whole. If the FDIC runs out of funds, the government supplies new funds, and the Fed will back it, since the FDIC IS the government.

          Smaller banks are routinely resolved that way. It’s just that the Fed didn’t want to let rich folks like Warren Buffett with his finance and insurance empire take a big bath on their equity stakes, which would have gone to zero. That’s all there is to it.

        • Steve says:

          Pro, Your joking right? Nearly all GDP growth in the past 10 years was purely credit driven. All that did was pull future growth into today.

          How in the hell IS that good for anyone long term? It’s short term thinking like that that lead to where we are at.

        • Lisa_Hooker says:

          @Pro-E – Our “leaders” haven’t been able to work among themselves for years. They have zero inclination to work with “us.” Open your ears and eyes and think.

        • economicminor says:


          The thing is that more debt has never solved an insolvency problem before. All it did was postpone the inevitable destruction. And as I see things, made the chaotic destruction much worse than it would have been 10 years ago.

          Sure there would have been job losses and misery but what do you think is going to happen next? I do not think your vision of a rebound is possible until the Ponzi Debt Pyramid has crumbled to the ground. Only after that burden is removed will there be a vigorous although somewhat slow new economy. A new normal so to speak.

    • MD says:

      Really? With 20+ million thrown out of work and therefore 20+ million fewer consumers in an economy mostly based upon [debt-based] consumption? A quick recovery?

      I’d like to know the logic behind that hypothesis.

      “I’m in a REIT” – ergo, I guess you’ve got to believe it’s going to be a quick recovery!

  8. Steve says:

    For all the reasons stated is why most of the 20-30M newly minted Unemployed will never work again and the those that do will work for less wages than pre-pandemic.

    Not a good time to be unemployed and those that are should feel damn lucky because we may not be far behind.

    • fajensen says:

      Which means that ‘society’ has better come up with some ways of putting food on their tables and roofs over their heads. To stop the crisis created by the virus we will have to do many things in a new way.

      There are other people who will do all of those tings for you for just a few favours, here and there. They are the mobs and the cartels. And various jihadist outfits. In my opinion, we don’t want to become ‘Latin America’, when we have the resources to become something else.

      • Steve says:

        Correct. With the convergence of efficiency gains and population explosion this problem was inevitable.

        There is something to be said for a less efficient supply chain.

        • AJ says:

          the economy and monetary system were going to tank anyway previrus, it just made a convenient pin. I just wonder how medieval it is going to get. We better start screaming at the Congress to earn their own pay and come up with better plans. The 4th relief package is supposed to be the biggest and McConnell is already going all squishy about the cost. I think some businesses are going to be let go, they cannot and should not bail them all, we won’t need them all going forward. And like it or not, if some sort of MMT is not forthcoming soon, there will be riots. Then they can have the martial law some are having fervent dreams of. I think Trump believes he will get lucky with the economy. I just don’t see it coming back for years and years.

  9. This economic cliff dive arrives at the end of a tepid recovery. Fed cutting rates ahead of a slowdown, stimulates excess which results in more bankruptcies. Covid supplied an instant recession times 2. Fed was slow to react, then nationalized the economy. They continue to blunder almost daily, after buying MBS and blowing up the interest rate spreads. Now they are pumping up corporate America on a case by case basis. Whether it was six months of REPO to fix a one day event, or rate cuts while the market was ATH. Fed is a committee, and the proper solution in this case, is the firing squad.

    • Tony says:

      Do you think that one day we might have a Nuremberg style Economic Crimes tribunal?

      A show trial of corporate, medical and banking executives might be all that’s left to maintain government legitimacy.

      “Let a thousand firing squads boom”, to paraphrase Chairman Mao.

      • Prairies says:

        The government officials that would organize such a tribunal would have to sit and be judged. So I don’t think it would be in their best interest to hang themselves. “Let a thousand suicides boom”?? perhaps, the point for government legitimacy is long gone.

  10. Endeavor says:

    The coastal states, with their FIRE, technology and government bases economies will rebound first. The heartland will take longer especially the Upper Midwest and Texas due to auto and energy problems. Where I live, Michigan, the old saying is first to fall and the last to recover. Can’t see how this would be any different going forward. I know it’s been said here before but I also doubt the elites will change things as they have them just the way they want them right now. So sadly, look for a long slog and a permanent reset lower for may regions and their people.

    • Wolf Richter says:

      Commercial Real Estate is in for a long-term nightmare, particularly office space. The retail (malls, shops) sector of CRE has already been in deep trouble for years, and that will get worse. Etc. So you can take the FIRE economy and chop the last two letters right off. So now you have the FI economy. And there might be something to it. The Fed is heavily favoring the F-part of the FIRE economy.

      • polecat says:

        Fee Fi Fo Fum, I smell the blood of an Insurance Sales Mun !

      • economicminor says:

        I think you have to add in all those top of the price condo’s and apartments in all those new high rise towers.. Made for people who didn’t actually exist when they were in the design stage, much less now that they are complete or almost complete. From what I have read, virtually none of the newer buildings were designed or built for the moderate income earners. All the profits was in the high end and that’s what everyone built.. Everywhere.

    • Happy1 says:

      I question the logic. Coastal states generally are ascendant but they have weakness because of high taxes.

      New York is highly dependent on finance and its state budget will take a massive hit with a bad market. NY state and now even NYC are net population losers, the very wealthy have figured out they can live in Miami 6 months and not pay NYC + NY state taxes. New York will be in trouble.

      CA is similarly dependent on IPO wealth to meet its budget, and will be in trouble very quickly with a down market, probably this tax year. I would not bet against the CA knowledge economy in the long run, but WA with its lack of income tax is becoming a viable alternative in that arena, and CA will either cut the state budget to the bone or raise taxes on the wealthy to a level where they will be less competitive long run.

      TX will be hurt by energy crash, but the economy there is far more dynamic than in the 80s. I would also not bet against TX long run. No better state to own a business.

      • VintageVNvet says:

        Not to toot FL horn, but IMO, FL is a much better state to own a biz, as is clearly illustrated by the number of biz owners moving there every year.
        TX only advantage is likely to be more RE, wide open places, available for new factories, and perhaps more willingness of politicians, as FL has a lot of NIMBY types who have moved there along with the biz owners.
        Not likely continuing today, with road blocks set up to keep out folks from alleged ”hot spots”, but recently, previous virus, net immigration to FL was 500 PER DAY, and there were still tons and tons of help wanted signs and ads, including most ads for high tech types, with very attractive salary vs COL ratios…
        Both have similar climate/weather challenges, though panhandle of TX is likely consistently colder in winter than panhandle of FL.
        Just like everywhere except perhaps Shangrila and Islandia, there are various and sundry pluses and minuses both places.

    • Wolf Richter says:


      I missed that one in your geography: Since when is Texas NOT a “coastal state?” I remember distinctly that we used to go to the beach (tarballs and all) whenever we could. The Gulf Coast is huge.

      • Endeavor says:

        I missed that one in your geography: Since when is Texas NOT a “coastal state?” I remember distinctly that we used to go to the beach (tarballs and all) whenever we could. The Gulf Coast is huge.
        Got me on that one. We illiterates in the Midwest think of the left and right coasts as ‘the coasts’ as Canada looms over us like a glacier. As far as the FIRE economy suffering, we don’t have much of one in Michigan. In fact we never recovered from 2008 after being weakened by 30 years of offshoring of business prior. We have a low percentage of 18 to 59 year olds in workforce participation and wages are low already. Another 500k in chronic unemployment will make ‘the coasts’ look like Valhalla to us.

  11. Tony says:

    I dont understand when you say ecommerce is booming. People dont have money. How can things be booming? If the consumer lost their job, that should pretty much sum up spending. Delivery service shouldn’t be booming either. We got furloughed and we havent spent a dime on anything online or have had any deliveries. I havebt noticed too many delivery trucks from the neighbors ordering anything either. We even canceled stuff a lot of our online services. What do I know though…haha. are you trying to hype ecommerce? Like the Tesla hype?

    • Tony says:

      I’d also like to add….this economic downturn is a direct result of government keeping people from working. The jobs were there before. This is pure economic manipulation. (I’m not disregarding the virus) I’m just simply saying that…regulation is keeping us from working. You guys need to realize that.

      • Portia says:

        I really wish there was lucid communication about the virus, how it spreads. I was wearing a mask in public to protect myself when they were telling us not to unless we were sick, and I thought, well, if they think I have it, so what. It was obviously airborne–people were being infected by being in close proximity and touching common objects and transferring it to their mucous membranes. This abominably poor narrative is why people were not personally proactive, and it led to the public being treated like cattle. There are multiple motivations here, and people in authority working against each other, and the hard thing is that, they don’t care, and as the nurses say, they are tired of being treated like they are disposable.
        I hear you saying “the government” is keeping you from working, that “regulation” is keeping you from working. I think it’s the clusterfuck of power that keeps muddying the waters and confusing people that is responsible. I have no answers.

        • Gandalf says:

          That early thing about not wearing masks came from the CDC, which, in my long professional experience, sees its main role as being one to soothe the American public and downplay panic about infectious disease pandemics that can kill you.

          They did once also say, in the early 1980s, that women could not get AIDS, which totally did not make sense at a time when little was known about AIDS. It was definitely known that this was sexually transmitted between gay men. So why not with heterosexual sex? I remember all sorts of twisted rationales for why women could not get AIDS. Their vaginas were tougher and more resistant was one.

          Well, surprise, surprise, women did get AIDS, worldwide.

          Never trust what the CDC says if it goes against your own common sense, is what I say.

        • Kasadour says:

          I’d like to see a comprehensive demographic study on all COVID 19 deaths, sampling them New York City, for example, and placed on a graph or chart by location, age, gender, and other data points that are available.

        • Portia says:

          Kasadour, don’t know how much faith you can put in these numbers, but they are here

        • jgoak1 says:

          Gandalf is spot on with regards to the CDC. There are numerous studies dating back to the original SARs outbreak in Hong Kong and Taiwan showing the efficacy of masks.

          It’s basically criminal neglience what the CDC, surgeon general, and most of the politicos have done in deliberately misleading people on masks.

          It could have been framed differently and more honestly in simply saying there was shortage but they chose to lie and say masks don’t help.

          Mind you, these same people encourage you to wear seat belts, wash your hands, look both ways before crossing…all of which are imperfect but generally positive means to lower your risk.

          Is it any wonder why people don’t trust the government?

        • Kasadour says:


          Thanks for posting the link to that. Much appreciated.

      • economicminor says:

        The regulations that hurt my local economy are state generated more than the federal government kind.. Oh the loggers say that the environmental laws prevent them from logging but I’m not a unobservant idiot, almost all the big trees are gone and taking the little ones just leaves us with a desert. And a fire hazard. They refuse to do the thinning as it is to costly. They just want to clear cut, replant and ignore the land until the trees are a dense fire hazard, then they want to clear cut again.

        In Oregon the state controls the local zoning so it is very difficult for mom and paws to do anything other than work for the big corporate outfits. Oh we have our food carts but Southern Oregon was a paradise when I moved here more than 50 years ago. Its biggest long term potential was small tourist enterprises and small businesses including small farms. The state made it either illegal or so difficult to operate that most abandoned any idea of survival.

        Changing the regulations on Fracking or Water quality or air quality or how much crap a mine can dump into the rivers or let leach into the system doesn’t really help any of the little people if those are the regulations you are complaining about. The couple of jobs isn’t worth the health care costs to the majority from the pollution.

    • Jdog says:

      Everyone has money, at least until their credit cards are canceled. The government may just give everyone a free ride on those debts too to try to keep things going. Besides, a lot of lower income people are going to actually get a raise from getting laid off. Someone making $400 a week is now making close to $1000 with the Federal bonus, and not paying rent on top of it. Others are ditching their mortgage payments.
      Responsible people are already cutting back, but the irresponsible people will not stop spending until they have no means to do it. That will not happen for probably 3 to 6 mos. Then they will default on their debts and lose their credit, and that is when you will see the economy really start to crater.

    • Wolf Richter says:

      Best Buy ecommerce sales jumped 220%. Amazon is limiting orders of nonessential items because it has so much business it cannot fulfill the orders, despite having hired tens of thousands of people over the past month or two….

      There are plenty of consumers with plenty of money. And now all that stimulus money and that unemployment money gets spent online, instead of rent payments and mortgage payments. This is HUGE.

      • polecat says:

        An Amazon ‘fullfillment’ center is SUCH a safe and pleasant place to work from ….. /s

        There’s your neoliberal hell-hole serf-engine tight there !

      • Jdog says:

        Yes it is huge, but may not be sustainable. The biggest factor as I see it in the economy is culture. Over the past 40 years, we have developed a culture of consumerism. We spend basically every cent we earn and extend our purchasing far into the future with credit.
        2 things stand in the way of that behavior continuing. One is that if deflation happens, most people will be broke. The value of their assets will not equal their debts. The other is the psychological effect this this will have on people going forward. If this thing is as bad as I think it will be, it will shatter people’s reality about what they think is normal

        • cb says:

          @ jdog –
          If deflation makes most people broke, then they are most likeley broke anyway. Falling asset values should be a net positive for working people. Cheap assets are good. Debt is bad. If that debt is collateralized by assets that fall in value, the debtor can walk. And thereafter replace the assets at a better price.

        • Faifo says:

          Empires always fall, sometimes rapidly. The American empire has toppled.

      • Prairies says:

        Not goin to lie, I have been using Best Buy online for a few things the last couple years( I don’t buy much so a few things is a lot). The pricing is really competitive in Canada, Amazon and Ebay just aren’t really cheap up here.

        The big hiccup now is freight, hard to find cheap freight unless the items come from a fulfilment hub.

  12. Jeremy says:

    Some agriculture is okay. North American wheat and corn is mostly produced by small teams of people using combine harvesters.

    I’m hearing other things about other sorts of agriculture though.

    Strawberries and other fruits are in trouble around the world. Labor intensive, not compatible with lockdowns. Not sure how long that will take to recover after (suppose it depends on timing of lockdowns vs growing season).

    I’ve also seen several stories about rice in Asia. It’s more labor-intensive than wheat, and apparently farmers haven’t been able to get their crops planted (as of a few weeks ago; I may be out of date).

    • David Hall says:

      There are dead orange trees and abandoned citrus groves across the Florida peninsula. The citrus greening disease has reduced the orange harvest to a fraction of what it once was.

      Tourism is upside down. Winter residences were vacant half the year and non-essential.

      • VintageVNvet says:

        You are correct about the ”greening” devastating citrus DH, but that is far from the only agricultural domain in FL now and for eva.
        Met a TX ”cattle woman” out west a couple, (few) decades ago who told me that in the 1950 census, FL was a larger cattle producing state than TX; quite frankly would not have believed her if she had not proceeded to tell me about her family’s ranches, about 250K acres, so just a small one, and how they had improved the pastures for 50 years to increase their herd, etc., etc. (IOW, she knew what she was talking about.)
        These days, due to development,dizzy world etc., moving inland from the coasts, there are surely a lot less cows, but there are still extensive farms for all kinds of crops, from potatoes to tomatoes and all kinds of other veggies and animals.
        BTW, “Winter residences” used to be vacant 9 or 10 months, occupied, if at all, only by caretakers and wild kids, before Mr. Carrier did his number on FL.

    • polecat says:

      Betch that backyard greenhouses, or anything related to domicile food gardening will be a winner going forward … assuming selling items like garden seeds for instance, is still legal .. and NOT under the stupid whims of governors and other clueless wankers !

      • Steve says:

        Stocked up on seeds while others stocked up on toilet paper. Will be well fed but could have some downstream issues, while they will be starving with no downstream issues.

  13. Anmol says:

    Wolf, still not keen on shorting the markets? The oil markets indicated a massive blow up. Most markets are correlated. How long before the general blowup affects the stock market.

    • DeerInHeadlights says:

      It’s already affecting the stock market. When any major sector experiences something what oil has experienced which inevitably involves a fair bit of forced selling, investors are bound to liquidate other profitable positions to make up for losses. That’s what you’ve been seeing for the last two days in the stock market. It’s not just profit-taking but something as big as oil can and is affecting things already.

    • VintageVNvet says:

      Short if you will, but keep in mind that this is going to be a long term thing, much longer than most can stand financially or, perhaps even now, at this early time, more importantly, psychologically.
      Some did short successfully in the former greatest depression, but those were the days when most folks still walked many miles per day, and lived in larger family and clan groups, sometimes even with 4 generations in the house, some of them respected elders, who had seen similar, or even much worse in their lifetimes, and could bring the focus back to ”this too shall pass,” rather than the current panic, etc.
      While I do not think we are going to see a total meltdown in the global totality, and certainly hope not, IMO there is plenty of possibility of localized melt downs that could include some very bad ”stuff” both on the guv mint side, and the vigilante side. Way too many vestiges of harmful myth and mythologies remaining to consider that We the Peons are going to proceed in a rational and reasonable manner everywhere.

  14. Frank Miller says:

    Like some medical conditions, the best possible is treat the symptoms and care with dignity. For USA, both of these are not happening very well. Hence the angst. Hence the push to go back to work by some; (despite the freedom cry, its about a few to a lot more die, but some can then buy rent/food/health care/etc).

    Poor to incompetent to corrupt leadership (political philosophy?) is in the way. That is just cruel and barbaric. I hope voters at least think about who they vote for the next time. I hope more compassionate, capable, and intelligent leaders come forward.

    To treat the symptoms with dignity, is to print for main street. The cost to print is zero; especially if the Fed and banks are shoved out of the way. That decision has already been made. Noit is about who is supported. Support forsupply side (corporations, zombie corporations) is anti capitalism and moronic. Demand-side is the issue and what needs treatment and respect.

    During covid-19, lets discuss what kind of a world we want. What we have in common. For the ‘majority’, imo, that is pretty close. And less divergent and constructive, than the left/right binary and myopic view. We can not leave this discuss to the left/right extremist. A new center needs to be defined.

    Good luck. Be safe.

  15. Deanna Johnston Clark says:

    My son’s business closed so he got a job at a nearby grocery store. Mostly he works in the meat dept…tons of meat, good quality. It is a smallish franchise…many poor black customers and elderly of all sorts and varieties. They NEVER ran out of toilet paper or meat or canned beans. They got shelves of bleach delivered overnight while the chains were empty for…well they still have no bleach.
    The big chains with higher prices ran out of everything and still don’t have toilet paper.
    Sometimes snobbery works against you!!! Drive to a country IGA or a Piggly Wiggly…live a little!

    • td says:

      While the local Costco was out of everything, I drove to a local drug store who were having a sale on household paper products with lots of stock. A little flexibility helps.

  16. Michael Gorback says:

    With no effective medication and vaccine merely wishful thinking (where the HIV and hepatitis C vaccines?) it might be better to do a slow staged reopening and let the chips fall where they may. Some won’t survive, some will survive with permanent impairment, but you can’t print an economy.

    I’m speaking as someone in a high risk group (age 67 with some medical problems) who continues to risk his life every week seeing patients, not as a millennial who thinks they’re 10 feet tall and bulletproof.

    This is the reality. No treatment, no vaccine. Hope is not a plan. Barring a miracle pretty much everyone will eventually get infected.

    “Cry ‘Havoc!,’ and let slip the dogs of war.”

    • NY Geezer says:

      “do a slow staged reopening and let the chips fall where they may.”

      I suspect that governments will eventually allow all businesses to reopen and let each member of the public decide whether the reward of being a spectator at a sporting event, or a cruise passenger, etc. is worth the risk contracting the virus I also suspect that the advertising industry will go into overdrive with the message that most people just get a cold from the virus, deliberately ignoring the grim mortality rate. The part of the public that has evaded the virus will have to be gaslighted. They will have to be convinced that it is safe to come out of their homes when it is not.

      Let’s see whether the public is gullible. What will government do if most people decide the risk is too great??

  17. Jdog says:

    Even during the Great Depression, life continued. There are, as Wolf said, just many adjustments. My stepfather was a machinist and lucky enough to get a job with a casket maker in Chicago during the depression making the handles and ornaments for caskets. He said he made good money all during the depression because death rates skyrocketed and there was a huge market for caskets.
    Certain niches will do OK, but in the macro view productivity is going in the toilet. Supply chain problems alone will take years to smooth out. Defaults will be huge, and as a result, lending will tighten significantly.
    We really have not even begun to see the real effects of this thing yet. People are still in denial it is even happening. The foreclosures will be postponed for a year or so due to forbearance, but who seriously thinks any of these people are going to be able to come up with a balloon payment or be able to refinance a year from now after property prices plunge.
    The government and the Fed have played the game of kicking the can down the road since 2008, and it has only made the problem worse. All of the solutions they are trying are only putting their fingers in the holes of a crumbling dam and there are too many holes for them to reach.
    The problems we are facing are going to be made even worse by the fact that our society is basically spoiled and entitled, and cannot tolerate even a little discomfort, as we are seeing now with the protests and civil disobedience. Going forward as times get harder I expect to see people become bitter and cynical as their lives become hard and they begin to see the worst in their fellow man.

    • Tony says:

      People need to stop comparing the Great Depression to now. It’s literally not at all the same.

      A lot of people just like to watch the world burn too.

      All say this again…this economic downturn is manipulated because the JOBS were there and they were taken away by executive orders to shelter in place. This is literally nothing like the great depression. (I’m not disregarding the virus) but everyone keeps saying, “OH! I knew the recession was coming.”

      The govt has a lot more power than people think. They could easily freeze all loans, mortgages, car payments, ALL financial markets…and just tack on all these past few months at the end of the loans instead we get the peanuts of a $1,200 stimulus check… correct me if I’m wrong but 2.2 trillion dollars divided by the populous comes out to roughly $5,500 PER PERSON. Is the govt really that naive to think a measly $1,200 will help anyone?

      • Just Some Random Guy says:

        Don’t forget the $2500/mo federal unemployment money that was part of the stimulus. That’s on top of state UE benefits. For most people – virtually everyone outside of the coastal areas – $2500 covers a mortgage and then some.

      • RD Blakeslee says:

        “People need to stop comparing the Great Depression to now. It’s literally not at all the same.”

        Were you there in the 1930s, Tony?

        I was and while it’s very early in the contemporary depression, it feels much like I remember “the big one”.

      • tom says:

        Small business owner, and old enough to have lived through a couple of recessions, and the great housing depression.

        None of them compares to what these idiots have done. Critical thinking has been frowned upon. It has been decades of consensus
        and conformity education. The sciences have suffered the greatest.
        I’m sure there will be modeling made for the next wave of Wuhan that will predict a billion dead unless we all curl up in our caves.

        Tony if you want this to end, its very simple. Shut down the internet.
        I would give it 48 hrs before every state house, and dc would be smoldering rubble.

      • sunny129 says:

        ‘They could easily freeze all loans, mortgages, car payments’

        Have you forgotten for each debtor there is a creditor/Lender/investor at the other end!
        Who is going to be responsible for interruption in the service of debt or income stream like those pension funds/Hedge funds who have invested in MBSs?

        How long the delay? 3-6-12months?

        • Tony says:

          There would be no interruption. The creditors/lenders accounts would also get frozen. I’m talking about every single financial payment…that includes creditors/debtors. Freeze it all until “Big Brother” thinks it’s okay to open the economy again. Trust me…the govt has this power. It’s no different than when FDR outlawed gold in order to save the dollar. Do you not see the executive orders being implemented now? It’s quite apparent the govt has POWER. They could freeze whatever they wanted. Why aren’t politicians or govt employees taking pay cuts etc and why isn’t taxes being lowered? Makes you wonder.

        • Lisa_Hooker says:

          @Tony – So what exactly are you going to do when they freeze YOUR bank account – just for a while?

      • Jdog says:

        Actually it is very much like the Great Depression. The decades preceding the great depression were times of great prosperity fueled by both new technology and massive extension of credit, and asset inflation, just like we have had for the past 40 yrs.
        It is the asset inflation, combined with asset inflation outpacing incomes that causes recessions and depressions.
        In the great depression people awoke one day to find out that they had overvalued their assets, and that they really were not worth what they had thought they were. Today we have once again inflated our asset values to the point where they make no sense.
        When current asset values are repriced by deflation, most people will be broke, just like the great depression.
        It is not wanting to see the world burn, it is just understanding and facing reality.

    • LeClerc says:

      The Graduate, 1967: “Plastics.”

      Now: “Caskets.”

    • DanR says:

      I think we should just extend forebearances each year until this is solved.

  18. Stephen says:

    The goobermint still seems entirely focused on the ‘virus’ (don’t get me started on that), and is giving very little attention to the rapidly deteriorating economy. I am pretty sure that by the time Trump and team start to focus on ‘bringing the economy back’, the real economy of good and services’ will be long gone. Yes, a few sectors will come back, but you are not going to have a ‘V’ shaped recovery with 30 million people or more unemployed. Remember, the weekly unemployed statistics are mostly drawn from filings for unemployment – something that not every worker does on the week they are unemployed. Hence, I would say these weekly ‘millions of newly unemployed’ are probably on the low side. As I have written before, many of the people who insist on the lockdown are NOT the people who would be effected. Has any of the Governors offered to give up THEIR pay and benefits? Yea, I thought so. Going to be a terrible decade ladies and gents. People in DC are very clueless at this point!

    • sunny129 says:

      Saving the LIVES vs JOBS

      Choose just ONE of the above!?

    • fajensen says:

      I hear those meat plants are hiring recently. This is an opportunity to do your own small sacrifice for The Economy and show us how its done!

  19. Michael Engel says:

    1) Back to normal : WTI Future closed yesterday @ (-) 40.32 and
    today it opened at (+)21.27, leaving behind a huge gap.
    2) Western Canadian Select – WTI moved higher and closed at (-) 10.75,
    testing Mar 2019 high at (-) 9.4.
    3) Canada will further constrict Alberta production and store excess oil, in empty R/R tank cars. The two Saudi oil tankers that are coming to US in May will exacerbate WTI storage capacity distress.
    4) WCS – WTI might be positive, or close to positive territory.
    5) With helicopter money thrown at so many American, hotels for free
    and low gasoline to fill the tank, America will never miss a rare opportunity like that, hit the road. delay opening their businesses, because America need a summer break for relief.

  20. Cobalt Programmer says:

    Wolf missed a important piece of analysis: yesterday’s oil plunge coincides with 4-20. Not just the US, all the worlds economy is going to plunge.
    About agriculture: Flood, drought, crop failures never caused famine. You may not get strawberries or avocado but rice will be available. Pork plants may be closed but USDA has government cheese in the storage. Even during irish potato famine or Indian famine, British politics bring the famine not the agriculture. NEVER

    Half of the food we eat is oil. US is the land of cars and roads. Oil demand will pick up once the lockdown ends which depends on the virus and the climate and so on. I guess an year or so.

    One good thing is people who are out of this lockdown want one thing. To Live. To Enjoy all the pleasures of life. Food, games, bars, restaurants and gyms. If they have money. So, provided the Almighty printers are on, we will have a roaring 20s.

  21. Keepcalmeverythingisfine says:

    “How far will the economy plunge during lock down” is a very specific question. Just during the lock down phase the -10% number is probably not far off. We are basically there now. We are at the end of the lock down phase in some states, and near the end in others. As more states exit the lock down phase and move on to the “just be more careful” phase much of the US economy will rebound. Essentially, we’ve seen the worst. There will be less suckage going forward in many states. Keep your chin up. It is a wonderful human trait that we are not programmed to remember bad experiences for very long.

    • Weary Patience says:

      One wrench in the gears is a lot of employees on unemployment now are making more per week than when they were working. These benefits are guaranteed for weeks at the higher rate and lots of states are waiving the “must be looking for work” requirement to continue receiving benefits. What motivation is there to take a pay cut and go back to their job that’s still there? This could be a drag on everything getting back up and running quickly like a v-shaped bottom as is currently predicted.

      • Jdog says:

        Good observation. Almost any time the government tries to help, their actions are counterproductive. This is because they are both incompetent and immoral.
        The businesses most severely impacted by this, usually have lower paid employees. Those employees are not going to give up their generous unemployment benefits to go back to work making less money.
        This situation was probably created purposely by Democrats in order to try to force employers to raise wages. What it is likely to do instead is force employers to automate and eliminate these jobs permanently.

    • sunny129 says:

      Stock mkts remain utterly disconnected with the REALITY that is descending slowly, one day at a time!
      So are the investors with cognitive dissonance!

      Mkts slide is guaranteed with spikes related to half hearted and ineffective attempts by Fed, jaw bonning by Donnie, hopium and wishful thinking talking heads on TV. But denial reality is palpable here and every where! Wow!
      Yeh. we are heading for a recession 3 times deeper than GFC!

  22. Michael Engel says:

    1) Many more American have been infected by covid-19 without knowing about it, or developing only minor symptoms.
    2) There is no vaccine.
    3) Protect the vulnerable.
    4) America will become immune when most low risk American, the relatively healthy people, will be infected, recover and develop immunity.
    5) At certain point all gates will be closed for covid-19 to proceed.
    It will die or fade when there is nowhere to go.
    6) Locking people up, over protection by forcing people to hide, not to face the problems, will exacerbate the situation, will prolong the disease and kill the US economy.
    7) Exposure will stop covid-19 and we will move on.
    8) Dr. Katz .

    • sunny129 says:

      There is NO evidence of HERD immunity being developed any where in the World, so far! Transient immunity yes but temporary as recorded in China. But some of them got re-infected again, later!

  23. Paulo says:

    Good article and timely…in a thought provoking way.

    Regarding this statement: “But other parts of the economy have essentially collapsed, with near-zero revenues, such as sit-down restaurants, sports & entertainment events, or the entire travel and accommodations industry, including airlines and hotels.”

    My parents generation, Great Depression vintage, never ate out at restaurants. Sports was listening to baseball on the radio or catching the local high school basketball game. Entertainment = radio and penny poker on winter nights, fishing. Airlines and hotels? Seriously? I submit most of today’s economy that has collapsed was fluff and unnecessary to begin with. I have said this often on WS. How realistic is it for a young family to go to a theme park on a cc? Or buy a new car on time?

    So, online is booming……just like we used to order from Sears catalogue. Imagine, some things stay the same. People are now cooking at home, just like my family always did. Going to a restaurant for a meal was a great big expensive deal, for a special occasion. It was a treat.

    My son is presently on a layoff bubble. He is just senior enough to keep his job. He is single, has a renter (on a pension) in his house that pays for his mortgage. He is sharing a home with 2 other workers to cut expenses. I told him, “You may just get laid off….and the worst that will happen is you phone the dealer and tell them to come and get your truck. Meanwhile, while you are working, be the indispensable one, the guy they cannot imagine doing without.”

    My wife and I were just talking about son. In his case this collapse will be good for him as he has never had to worry about employment and the basics. As a parent I would like to see him do well and have an amazing life, but it has been so unrealistic to this point. Those of us who have faced down hard times….layoffs, being underemployed, sharing expenses, and worrying about making ends meet, have ultimately been better for it.

    As trite as it sounds, I can only hope many will relearn basic life skills and be stronger for it. Our 1st world lifestyles have been unrealistic for decades, and I don’t think people have been happier for it. My grandparents would sit out on the screened front porch on those hot Minnesota evenings and visit with neighbours who were out for a stroll. They were pretty happy, if the truth be told. 5 kids in a 3 bedroom bungalow, with a screened front porch and a 1/2 acre garden. One bathroom, and they were pretty happy just to have that.


    • Portia says:

      Paulo, I think we are of the same generation. I remember community like that, and in rural areas it still exists. I just don’t know if basic life skills are going to be appealing to people who live in their heads, and there are many more than long ago. I think they will choose the virtual life. Younger people are addicted to constant change and stimulation these days. They are going to be going through some heavy withdrawals. Spending a lot more time in Nature and working with their hands will help I think. It’s too bad that creative pursuits have been so devalued.

      • A says:

        Portia, This is not about laziness. This is about land use and access.

        There are so, so many young people around the world who desperately want to work with their hands, grow things, live in small cottages, live with the land, get back to nature. And many of them are stuck in expensive school situations that make them teeter on the edge of being actively suicidal, or working minimum wage jobs that deaden the spirit and offer no hope or path forward to that land, that cottage, that life that doesn’t revolve around belonging to a corporation.

        I’m sorry if that sounds overly dramatic. I truly believe young people are DYING for this change.

        1) How do we create small villages / land access for young people?

        2) Affordable housing and jobs / income that don’t require living away from the land?

        3) ACCESS. We need small houses, small lots, and less regulations about lawns and stupid things that don’t matter.

        The technology exists (old and new) to create small dwellings, whether you’re talking homemade houses, tiny houses, new sorts of manufactured houses, so-called traditional (but smaller) houses, or any of the myriad building techniques that are out there which are regulated out of any practical existence.

        So, basically, when will the gov’t the people, whoever is in charge of who is allowed to use land, stop its greedy hand and allow YOUNG PEOPLE ACCESS TO LAND, HOUSING, and a chance? We don’t need more malls and office buildings; we don’t need more expensive housing and high rises.

        We need
        1) small, affordable lots (reasonable loans offered or buy with cash)

        2) NO PLANNING PERMISSIONS OR RULES about building your own home, growing whatever food you want, in short, the right to do what humans have done for most of the history of humanity which is now illegal and unsightly and ruled out of existence. Provide for yourself! Make choices about what you grow / raise / live off / sell!

        3) village or small town layouts with places for businesses you can walk or bike to; local markets or market days to sell / trade your meat & produce, etc., where desired

        4) workable infrastructure that is free or affordable (even if there’s less of it).

        Does that sound like hard work? Does that sound inconvenient? Does it sound even a bit stupid to consider in this day and age? I promise you there are young people whose lives are so unhappy, so barely clinging to existence unhappy, that are longing for a chance, any chance, to have their own homes, grow their own foods…they would be lining up. Even if it was hard and risky. It could be made less so; it could work, with education and help and opportunities.

        But yes, it would mean some re-organization of societies to allow these things, to stop the stranglehold of land use, to stop putting materialism above simple lives for those who want them. Even if only some people did this, and it worked for them, that would be such a pressure valve release on the emmiseration of the younger generation. There would be a choice, instead of just “get on the ladder; you live here now; you can never get off unless you die.”

        (At least some of the currency exchange in the community would benefit from being some form of “community dollars.” This is an interesting concept which has had many benefits to communities which try it. I’m not saying legal tender shouldn’t be in use, but this concept can help value to circulate value locally, which is really important when growing local opportunities. For instance everyone could have some ‘money’ to spend at local businesses every so often, & earn more ‘local cash’ by doing community chores, etc.)

        Let me put forward another option, if you don’t like the idea of small houses, small lots, and personal building. Have you heard of Acrosanti? It’s a fascinating community in one big building. There are videos about it online because it’s just so darn cool and interesting. They have specific rules and regulations about who is allowed to live there, pretty strict ones. But the rent is generally paid in part w/ community labor. The comment sections are always full of young people who LONG to visit there, to just give this different life a try. Who like the idea of the community, the better cost of living, of having a chance somewhere and being a valuable member of a community, in a cool-looking building, even if it’s in the middle of nowhere.

        Think of something like the Eden Project in Cornwall. This could be the model for a long term project that creates a useful and beautiful environment for livelihoods and economic value, even for living. They transformed an old quarry into a rain forest in a geodesic dome!

        Think how much could be done if a small fraction of the money wasted in gov’t spending was allocated towards making housing both interesting, visionary, and affordable. NOT in a top-down way, but in a way that allowed access to more and more people every year.

        Suppose there were architectural contests, and people could vote on the winners, and cool and weird places like this were built around the country (the world?), biodomes, earthships, permaculture backyards, retrofitted malls–there are so many cool options! Winning designs would get a budget to be built, and people could live and work in these places. There would be financial things to work out, but if there were opportunities for young people without a lot of money to be involved in building these communities, to belong somewhere, to build a real life that didn’t revolve around pleasing corporate masters…to have a real stake there and a happy, simple life…THEY WOULD BE LINING UP.

        This world of living on the internet whenever possible is not lazy young people refusing to live in the real world. This is more than learned helplessness (though it’s partly that–and who’s been doing the teaching?).

        For many people, disappearing into the internet or other entertainment, games, TV, etc., these are the things keeping them alive from deaths of despair. It’s not ideal. So let’s build something better, and entertainment can become a tool, or a harmless diversion, instead of the only lifeline many people have.

        It’s all kind of like drugs, in one sense or another, the things we numb ourselves with. You hope the people you love choose ones that don’t kill them. You hope they choose to survive till better days.

        You hope there *are* better days. They could be built, easily. But we need better systems and rules and most of all…new kinds of opportunities.

        We don’t have life or liberty with all these corrupt rules against the young people. They’re not hiding in Animal Crossing because the dream of a simple village life has gone the way of the dodo, okay? We need opportunities.

        They may be coming whether anyone likes it or not, if things fall apart enough that gov’t regulations can’t stop people from building. Of course, I’d rather see some plans and some help, not Hoovervilles that are better than nothing, but still pretty desperate. And probably have more alcohol and drug use to numb the pain than hopeful building and gardening!

    • The Colorado Kid says:

      A lot of Folks on here would do well to listen up when Paulo has a comment.
      This is a leveraged (like ’29) deflationary depression. The FED &the CB’s of the world will prove impotent in the face of this event, however; they may be successful in getting the inflation that they need for the reset. Right now though, we’re headed for the worst bust since 1929-1932. During that time there were many huge Bear Market Rallies of >20-50% before the bottom in ’32.
      I would get in CASH (T-Bills or FDIC MM) right now and maybe Long Treasuries (IEF & TLT) and Gold when it pulls back although that’s kinda like trying to buy insurance during the storm, but it might pull back again during a retracement when they open back up the shitshow (economy) again.
      There’s a book that will help give some perspective on what is happening now. It’s titled, “A Bubble That Broke The World” by Garet Garrett & was recommended reading by Kiril Sokoloff. The parallels to what are occurring now are uncanny. Proceed with caution on these retracements. I am.

      • suny129 says:

        ‘they may be successful in getting the inflation that they need for the reset’


        A wishful thinking! There is NO velocity of money into real economy. Stagnant wage growth for the majority. Supply shocks & Demand crush will continue. So are the defaults and the bnkptcy

        De-leveraging DEFLATION first!
        A DEBT has to be paid, written off or gone with the bnkptcy of the borrower and or the lender!

        • Jdog says:

          I agree, inflation is a product of nearly fanatic belief in the greater fool theory. It is not an easy psychological mindset to instill in people who have experienced deflation.
          You can see it in the posts here. Older people who have seen deflation, have a completely different mindset that younger people who have not.

      • Frederick says:

        Why wait for a pullback in gold BOAmerica just raised their 12-18 month prediction for the price from 2k to 3k Is it really worth the wait? I don’t think so

        • The Colorado Kid says:

          Yeah Frederick, you may be right. I just think that when everything opens back up you’ll see a risk on “buy the dip” mentality again and gold and treasuries will be sold off.
          In any case, during a recession the playbook is to hold cash and in a depression long bonds. A lot of Folks can’t understand the whole long treasury argument, but if you study convexity, then you understand (if you think yields go lower) the need to own long treasuries. The intermediate treasuries aren’t in the depressionary playbook, but if you look at the “Larry Portfolio” it holds 70% intermediate treasuries and did OK during this meltdown.
          My playbook is that I just use the old Harry Browne Permanent Portfolio and try and pick the one asset class NOT to own, which is maybe not such a good idea for the average Joe or Jane who’s not wanting to commit to the time that I put in on studying the markets and financial history in general.
          There is a good article on about the four portfolios that held up so far during this recent mayhem. Go to the Insights menu and the article has a pic of a guy sitting in an empty stadium. It was no surprise to me that the PP held up the best, being down only 7.5% during the worst of this.
          Also there’s the notion now that Risk Parity is a shit strategy nowadays because Bridgewater and others blew up so badly, but actually they weren’t really adhering to Risk Parity strategy because they levered everything up so dramatically, particularly the treasuries. So, there’s that. Anyhow, for the average person in a typical 401k maybe now is the time while they have this gift of retracement, to sell some equities and move some funds to the Stable Value fund that probably lives somewhere in their 401k.
          Anyhow, I wish everyone luck in the coming days. I would also like to express my gratitude to Wolf for this site.

    • Philip Frank says:

      Thank you, Paulo.

    • Just Some Random Guy says:

      ” How realistic is it for a young family to go to a theme park on a cc? Or buy a new car on time?”

      I have been to Disneyland 4 times since I had kids. And each time it was wall to wall people. Winter, summer, weekday, weekend, economic boom, recession. Doesn’t matter. It is jam packed. Generally with young families since young kids are the ones who go to Disney. Tickets are $100/day, a burger is $18, a bottle of water $5 and you can’t get out of the place without buying at least 2 $30 t-shirts. And yet day after day, it’s non-stop throngs of people lining up to get in.

      Ask 100 people at your office who have kids under 10, where they’re going for spring break, and I’ll bet 20 of them say Disneyworld/Land.

      I’m done with that place. Put in my time as a good dad should. :) But now that the kids are old enough, my wife can go with them on her own. I’m out of that racket.

      • Wolf Richter says:

        Just Some Random Guy,


        I’ve never been to Disneyland, but that’s exactly how I imagined it, and how imagined I’d feel.

      • El Katz says:

        I hear you on Disney… we lived 7 miles from Disneyland and never went. We had to go out of our way to not get stuck in the crazy traffic on the roads that bisected the park.

        My kids are in their 30’s. We went to Disney World probably twice (my parents lived in FL so we would bribe them to go visit). My daughter sat one day at the kitchen table pouring through old photo albums. She had zero recollection of going to any of the amusement parks (Sea World, Universal Studios, Disney, Epcot, Busch Gardens, and a host of other smaller parks around the country). She was shocked to see photos of herself, yet have zero memory of the event.

        Since that point, I have told many parents to not bother to spend the thousands necessary to enter these sucker traps. Most parents do it out of guilt because they aren’t spending enough time with their kids – so they’d rather commit financial suicide than take time out to spend times with their kids in their normal life. Teach them a skill…. my son is renovating their house. He learned some of the things he knows from watching me repair things. Our neighbors think we are “poor” because I do much of the labor on our home and cars myself. We’re not. We’re just frugal – and never wanted to become too reliant on others for simple things like….. cleaning a house.

        Those of you who like to read, pick up the book “Freedom” by Daniel Suarez. Sort of fitting for the current conditions.

    • Wolf Richter says:


      I wish your son good luck. I hope he doesn’t get laid off. But if he does, I hope he’ll be able to pull out of it quickly and move ahead.

    • Anthony A. says:

      Paulo: Thanks for the reminder as to how simple life used to be. I’m going on 77 and remember those days too. I suspect there will be positive changes in that direction once this mess is over with.

    • Gandalf says:

      Your son would appear to be a Gen X or older Millenial. This is quite different from the Gen Y and younger crowd.

      My son is an older Gen Y. Video games and self-isolation and/or being on the phone/social media 24/7 are totally the norm.

      He’s finishing up his coursework (finally) at UC Berserkley. When the campus went to self isolation and classes went to all online pass fail, it was like the best thing that ever happened. No more worrying about grades! Or having to walk outdoors and attend classes! Gets to stay in his room 24/7 on his laptop! Cooking? Restaurants? What’s that? Pre-packaged and frozen foods and microwave!

      Life is great.

      • polecat says:

        Ah, living the way of the wayward Ramen: begging bowl in one hand, and a samurai I-shite device in the other.

    • mr wake up says:

      Great Depression vintage- the last of the greatest!

      Life is simple we as people make it complex and complicated.

      We only need so much in life – everything else after that is a bonus.

      Perception is reality and superficial is the religion this materialistic world follows. We eliminated ancient tribes and culture for the malls and pop culture. The ancient Greek gods of mythology replaced with marvel. The children are groomed and raised to believe in being royalty through Disney, making parents who cant afford the lifestyle must work at the debt mills in order to finance perception.

      There is opportunity for this to be a great awaking as society recycles the artificial fabrics but with short attention span media they will keep the masses hypnotized.

      The upper middle class will descend into the upper poverty class as they get a downgrade like the over inflated buy back corps.

      I have young children and have used this rare moment to help build them a larger tool box. I grew with parents who were raised in suffering and I had to become independent at a young age. It allowed me the opportunity to grow outside the box and find my way in the good ole USA where anything was possible until the financial engineers decided otherwise.

    • Happy1 says:

      I’m also old enough to remember that world, although not as deeply.

      I’ll play counter on this though. The trend toward the virtual is inexorable and progress in standard of living is an unstoppable force. Your grandparents said the same thing about TV and radio and cars that you say about social media.

    • VintageVNvet says:

      Different strokes for different folks Paulo.
      My parents, b 1916 and 1922, quite literally partied through the 29-39 depression (formerly known as greatest,) and continued to party the rest of their lives: never missed the bar after work 5 days a week, usually had a ”working” lunch with martini before, wine with, and ”stingers” after couple times during the work week, etc., etc.
      And, then, when ”old age” finally caught up with them, along with a lifetime of smoking, drinking, drugs legal and not, etc., they both just said good bye, and went somewhere else quickly, as they had promised to do for at least 20 years.
      While it was always a challenge to hang with them, on farm,(80+acres for $16K,) town home, (2500SF/$12K,) and sailboats ( only home made or cheaper) around the world, there was never any expectation of ”going to heaven” or anything other than, be here now and enjoy life/fun…
      I think dad’s fave motto was, “De gustibus non disputandem est” or somthing close to that,,, or maybe, “Eat, drink, and be merry, for tomorrow we dine.”
      Folks need to relax and enjoy and not take this virus or any other of the current shit too seriously,,, no matter what, ya ain’t getting out of here alive.

  24. lenert says:

    “Economic Effects of the 1918 Influenza Pandemic”
    Federal Reserve Bank of St. Louis
    November 2007

  25. Charlie says:

    Since the first “modern” international wheat transaction from the US to Russia in 1972 (can’t count Joseph and the Egyptians long ago), the US government has pursued a “cheap food” policy in this country. Most US households do not spend more than 10-12% of their take home income on food, thank you to farmers. Agriculture will keep providing low cost food even when they are currently operating well under cost of production today. Thankfully, they are starting to plant their crops right now despite these difficulties. However, farm operations will continue to consolidate. My concern is that we may experience the mid 1980’s all over again and further consolidate farm operations.

    Several challenges in production agriculture going forward will be the same as other businesses in this current environment, staying afloat as long as the banker lets them. The challenge today lies in bringing demand back into more balance with current plentiful supply of all major US crops; wheat, corn, soybeans. This involves opening the economy back up sooner than later.

    We will not run out of food in the foreseeable future. We have 166 days supply of wheat in the US and have been as low as under 2 months in the mid 1990’s. You should have plenty of bread to go with your home grown vegetables this year. In the meantime, agriculture will survive as we are used to dealing with low prices, droughts and supply-demand imbalances that the market will eventually solve. The cure for low prices is low prices.

  26. Paul says:

    Rate of change and depth of the decline are two completely distinct mathematical concepts.

    Sure, the recent rate of decline has been high, but the Great Depression lasted 10 years.

  27. NY Geezer says:

    “Today’s 11% plunge in the WEI points at a recession that would be three times deeper than the Great Recession, if the WEI persists at this level.”

    In the great recession the S&P bottomed about 800 points below its peak which was 666 at the bottom. Perhaps this time the S&P will bottom 2400 points (800 x 3 = 2400) below its peak of 3390 which is 1590.

  28. Just Some Random Guy says:

    Pro sports will be hit hard by this. Now that it’s gone from people’s lives they are realizing they don’t need it. Is your life really any worse off not watching 10 hours a weekend of guys throwing a ball back and forth to each other?

    Other than that, I don’t see much long term change. People will go back to restaurants and bars the second they open. They’ll travel, they’ll get haircuts (and man do I need one badly!!!) and so on.

  29. Yancey Ward says:

    Even if the entire country reopened, it is unlikely now that even 25% of the people furloughed get called back immediately, and it is likely they will furloughed permanently by the end of July.

    The secondary effects are already starting- state governments and local governments are starting to lay off people because tax revenue has cratered. I predict by July, unemployment reaches 30%. At that level it doesn’t matter what the government does to keep the GDP numbers up- it will all be fake.

    • VeryAmused says:

      Do you mean more fake than the fake before?

      Oh snap, we hella fake now son!!!

  30. Wisdom Seeker says:

    Just want to comment that WEI appears to overcount the “COVID-impaired” economy and undercount the “COVID-resistant” economy, particularly the online economy. Half the indicators are clearly not going to be accurate for COVID-world:

    COVID-Inaccurate: Redbook Research: weekly same-store sales
    COVID-Inaccurate: Staffing Index by the American Staffing Association
    COVID-Inaccurate: Raw steel production (from American Iron and Steel Institute)
    COVID-Inaccurate: Electric utility output, excl. Hawaii & Alaska (Edison Electric Institute)
    COVID-Inaccurate: US fuel sales to end users (NY Fed calculations based on EIA data)

    • Wolf Richter says:

      Widsom Seeker,

      I’m going to shoot down just a few of your statements to save time.

      The staffing index is not at all irrelevant. It is a weekly index that provides data on part of the labor market. The labor market is crucial because it provides the money that consumers spend, and consumer spending is 70% of the economy.

      Raw steel production gives you some idea about manufacturing, such as auto and component manufacturing (which is huge), heavy machinery and equipment, including for the vast US oil-and-gas sector, and the like, that all use various forms of steel as one of their inputs.

      Electric utility output is a crucial indicator of industrial production, office occupancy, and the like. It has been hard hit. I just mentioned a power generator that filed for bankruptcy, citing the collapse in electricity demand due to Covid-19 as one of the reasons.

      On the other hand, you totally overestimate the importance of ecommerce in the overall economy. Ecommerce was $187 billion last year. The US economy was about $22 trillion (before all this happened). So ecommerce is less than 1% of GDP.

      The biggies in GDP are what consumers, companies, and governments spend on services, such as healthcare, finance, housing (rent), and insurance. Retail is small. And ecommerce retail is only a part of overall retail. For example, if ecommerce more than doubles to $400 billion, but the rest of the economy drops 12%, the overall decline would still be close to 11%.

      • char says:

        Doesn’t Ecommerce include travel?

        • Wolf Richter says:


          No. Travel is a service. Tickets and hotels are services. Ecommerce, the way we define it, is retail of goods that you purchase via the internet. I understand that there are many gray areas. Buying a ticket online is not ecommerce. It’s not the ticket you pay for, it’s the flight, and the flight is a service. The ticket is just a receipt.

      • Wisdom Seeker says:

        I’m going to argue that staffing company data will oversample large fixed-installation businesses, and under sample COVID-resistant areas.

        Steel production and the businesses that use steel are not in the online-based COVID-resistant economy, so it’s a metric that skews the WEI.

        Electricity usage in industrial and office locations won’t correctly account for productivity by home-based workers.

        Ditto for fuel usage.

        I’m not talking about ecommerce, but about COVID-resistant work-from-home. There are many people (myself included) who are still producing their usual economic output, but without it showing up in any of those metrics…

      • VintageVNvet says:

        Wolf, Please LMK if construction is still included in the ”service” part of the economy, as I read recently, elsewhere.
        That industry was my focus for many decades, and my heart is still there, in spite of all the young folks in the offices who have no clue about what it takes to stay on the working end of a shovel for 8 hours, or what it takes, logistically, to do any project without local resources of any kind or any kind needed, etc.
        And thanks again to you and WS for your very good work! With the education I am getting here, I might even be so bold as to invest in various non RE markets again, sooner or later.

      • cb says:

        Wolf said: “The biggies in GDP are what consumers, companies, and governments spend on services, such as healthcare, finance, housing (rent), and insurance.”

        Further evidence of the rentier economy we’ve become.

  31. BlowingBubbles says:

    On April 17, a devastating report was published in the Immokalee Bulletin titled “The Day South Florida Agriculture Died.” The report came from Gene McAvoy, associate director for stakeholder relations for the University of Florida IFAS Southwest Florida Research Center and president of the National Association of County Agricultural Agents.

    McAvoy described the situation as follows:

    “On Tuesday, March 24, a local broker says, everything changed. From brokers, orders stopped and everything got quiet. On Wednesday, March 25, it got super quiet.

    “Since then, tomato volumes are down 85%, green beans are like 50% and cabbage is like 50%.

    “R.C. Hatton has plowed under 100 acres of green beans, around 2 million pounds, and 60 acres of cabbage, or 5 million pounds.

    “Florida’s tomato growers target 80% of their production to restaurants and other food service companies, rather than to supermarkets. In this sector, growers are walking away from big portions of their crop.

    “Tony DiMare estimates that by the end of the growing season, about 10 million pounds of his tomatoes will go unpicked.”

    • Wolf Richter says:

      Yes, it’s very tough to switch from supplying restaurants to supplying supermarkets, especially with produce that you cannot store for very long.

      • Cas127 says:


        Adapting supply chains can be difficult but…from I have personally seen there are more than a food wholesalers who are really just going through the motions…kabuki playacting effective changes for some reason.

        Example – here in Vegas there was a *huge* food/TP wholesale supply going to the hotels…which have *all* been closed for over a month.

        And some wholesalers did open up online retail sales…but at absurdly overinflated prices…they must have had very, very little uptake since the unit prices were…well, idiotic.

        I’m not sure what their real motivations were…but I don’t think it could have been actual sales (playacting mitigation necessary to file legit claim for biz interruption insurance, maybe?)

        • El Katz says:

          We live in a small community northeast of Scottsdale, AZ. The amenities here are closed (clubhouse, pool, tennis courts, library, post office window, etc.,). The only thing that remains is golf (for what reason, I don’t know…. I guess to keep the club from going broke).

          The club restaurant can only provide carryout service for the last month or two. The prices are the same as the “sit down” costs (which were too expensive in our view to begin with – and still require a 20% gratuity for someone to carry it to the door). They also opened a “pantry” that supplies a limited selection of meats, veggies, milk, eggs, TP, etc., purchased from their wholesale supplier. The prices are enough to make you gag. Toilet paper @ $4 a roll….. is an example. Some people are taking advantage of it. I prefer to go to the store myself at 6:00AM and pick out my own groceries.

          What’s amusing is that I can go to the local Morton’s Steakhouse and buy the meal fixings for less than I can buy them from our own restaurant – and are of higher quality.

          Current thinking isn’t going to fix the oversupply issue. Rather than plow crops under, why not allow people to pick them like the apple orchards did when I was a kid? The waste is appalling.

    • Ricardo says:

      Blowingbubbles: that is just plain crazy. It makes no sense for people to be lining up in cars to receive food packages whilst someone else is plowing food back into the ground. Let the people come and pick the tomatoes to add to their diet. Either charge a minimum fee for what they take home or give it away free. Plowing it back into the ground is going to cost time and money.

      • Donald B says:

        How do we get the city-dwellers out to Bakersfield or Barstow
        to pick the crops that are rotting on the vine? So you claim.
        What farm-owner or operator will accept the liability?

        • El Katz says:

          What u-pick apple orchards accept the liability? Answer: They all do. Same with the “pumpkin patch” in the fall.

          It’s not only “city dwellers” that are going hungry. I’m sure there’s plenty of poverty near Bakersfield or Barstow (yes, I actually know where those places are) that could take advantage of those foodstuffs. Some could even pick them and take them to a food bank or farmer’s market.

          My son and DIL live in TX. One is currently furloughed and the other working from home (at half salary). They have (well had) a low mid 6 figure income up until a month ago. They have planted a gigantic garden – and are “sharecropping” with their friends who are in similar circumstances. No one is saying “no” to free produce (as in the past). They’re swapping eggs and taking other steps at expense mitigation (cancel Netflix for example). They dabbled with canning last year and found the salsa and tomato sauce/paste delightful over the past couple of weeks. They plan on doing more.

          And, no, this isn’t happening in podunk… this is in Austin (North Hills area, near the Apple campus). I only hope their prior lifestyle doesn’t come to haunt (they rolled pretty hard). I think their view of what’s necessary in life has changed. And that’s a good thing.

    • LeClerc says:

      Who can forget the UIW, pickers of industrial restaurant tomatoes, and their struggle for a living wage?

    • doug says:

      I read that Florida plants over 30,000 acres of green beans annually.
      100 of them is a low percentage.

    • VintageVNvet says:

      Thanks for the ”boots on the ground” reporting BB! Please continue to do your best here to keep us informed re your local scene. WolfStreet THE best that I have seen for respect for local news.
      As a teen in Naples now many decades ago, we all knew, and participated With many growers in Collier county who needed part time help, including especially harvesting, but including carrying water into the Great Cypress, on our backs, etc..
      It has always been a ”make it or break it” type of seasonal situation,,, with many cash sales in the fields making up for many losses elsewhere in the ”official” markets at the packing plants, etc.
      Other reporting re farm workers in Immokalee indicate dire need for immediate relief for these folks whose work is SO critical for USA food supply, especially at this time of year when almost all other growers, including even farther north in FL are not anywhere near harvest…
      Thanks again.

  32. njbr says:

    We’ve been given an estimate, courtesy IHMI, that deaths through August would be 60,000. Everyone seized on that one and said, “that’s not so bad”.

    Today, we’re at 45,000–and clipping along at 2,000 per day (yesterday 2,500 died). In a week or so, at that rate, we’ll be at 60,000 .

    What happens when it is generally figured out that we still have 3 of the 4 months since that prediction to go ’til August ?

    More enthusiastic calls of “die for the economy”?

    • DawnsEarlyLight says:

      Why don’t we list what really killed these people. Having Corona virus may exasperate their condition, but what was THE REAL CAUSE OF DEATH?

      • California Bob says:

        AFAIK and can tell, I don’t have CV-19, at least not yet, but I am a bit exasperated. If I do get the virus, that will definitely exacerbate my condition.

      • Happy1 says:

        Umm, the coronavirus…

      • Gandalf says:



        1. Pneumonia, It’s spring, I have never, ever seen so much pneumonia on Chest xrays and chest CT scans in the springtime before. Even during flu season in previous winters, I have never seen so much pneumonia before. COVID pneumonia has a classic CT chest appearance, but bactterial superinfection can mix up the appearance.

        2. ARDS, when the pneumonia gets seriously bad and the lungs white out with fluid on the Chest xrays. It’s frightening how fast this can happen. Seen a few cases now that went from clear lungs on a Chest xray to white out within HOURS.

        3. Kidney failure, heart failure, multisystem failure. COVID attacks the ACE2 receptors, which are everywhere, in the kidneys, heart, bowel, brain, vasculature, and skin. Patients might not have a super bad pneumonia, but then the other organs shut down. There are now published reports of COVID encephalitis, COVID induced renal failure, heart failure, COVID enteritis, even COVID toes (attacks the small vessels in the toes).

        So, stop putting out this BS about COVID making existing disease conditions worse. It’s the other way around. Existing disease conditions allow the COVID infection to get WORSE FASTER than in a healthy person. COVID can and will attack literally every part of your body and destroy it, not just the lungs.

        • DawnsEarlyLight says:

          Now that is an answer that many have been looking for, but saying their is no relation to death and existing conditions is pure BS.

        • Gandalf says:

          Yes, but you don’t have to be old or have preexisting conditions to get COVID and die. Lots of seemingly healthy young to middle age people have gotten COVID and died already. Nobody knows why exactly.

          My suspicion is that the severity of disease depends also on the viral load on initial exposure. A healthy young person who gets a whopping big dose of virus can get overwhelmed – the virus really can attack every part of your body. This would explain the deaths of relatively young healthy nurses, doctors, and other healthcare workers, many working with little PPE, trying to take care of COVID patients.

          Bottom line is that nobody really knows yet why some people get really sick with COVID, and why many are symptomatic.

          That means you’re just playing Russian roulette if you decide to ignore social distancing and sanitation precautions and go out and party and socialize and go to mass gatherings of people because you’re young and healthy and the odds are ever in your favor

        • VintageVNvet says:

          Thank you again Gandalf for your ”boots on the ground” reporting and posting here.
          With sufficient information, not yet available officially, We the Peons may come through this virus event without more deaths than would normally occur in a decade or so in spite of the very clear deltas on many parameters usually pertinent.
          Having said that, IMO, it is clearly, (as always,) up to the individual to do what they want to do privately,,,
          I just hope the increasingly available and better focused information, such as your first hand reports, will convince many otherwise skeptics to their best to follow ”best practices/protocols” in public.
          Had to go out this morning for more liquidity to fill my new WolfStreet mugs, and saw lots of folks ignoring common sense PPE precautions; wanted to scream at them, but, old and frail and, finally somewhat subdued, did not…
          May God/Great Spirits bless us all!

        • DawnsEarlyLight says:

          Thank you for your many posts about this corona virus, and enlightening us with your past and current experiences. It seems we are dealing with a ‘our country is dead if we do and dead if we don’t’ situation. Your postings help lift the ‘fog of war’ that we are dealing with.

        • Happy1 says:

          +1, exactly my experience, literally 20 more pneumonia in CO the last month than in 10 previous years of practice

        • Happy1 says:

          20 times more cases, sorry for typo

        • Lisa_Hooker says:

          A thousand thanks Gandalf. Finally a believable and comprehensive explanation of the systemic effects of SARS-CoV-2 infection. Looks like one mean, dangerous virus.

    • tom says:

      We need to demand that this will never happen again. And its a win for
      the economy, and a defeat of Wuhan.

      Were is ground zero for Wuhan in the US? What is their population density?

      We need more than a infrastructure plan. We need to end these high density ( think of evil CAFO operations ) cities. Repair & build more roads out into the country and lets get some new home construction going.

      And none of that commuter/high speed rail. Does no good to lower density to only cram them in trains. We need safe spacing. So out to the country & SUV’s for all. Its a win win. Great for the Auto industry & oil companies.
      Save lives & economy.

      • California Bob says:

        re: “We need to demand that this will never happen again. And its a win for
        the economy, and a defeat of Wuhan.”

        Presumes Nature will never, ever create another highly contagious and potentially fatal virus. My money’s on Nature.

        • tom says:

          So is mine. Let me clarify that comment.
          I’m just doing a little virus ” flattening the curve” 101.

    • Happy1 says:

      Yes, thousands of people are going to die, and guess what, this will happen sooner or later because we can’t purposely impoverish 30% of the country, people will self select the small risk of death vs the 1/3 chance they can’t stay in their home.

    • Cas127 says:

      Google “CDC all cause death statistics”…there are some limited indications that it may be very difficult to tease out exactly how much C19 is really elevating the overall death rate (obviously the lock down adds another complicating factor).

      And, in fairness, the NYC all cause death rates do look to be markedly elevated (in contrast to CDC year over year all cause death rates nationally).

      But…NYC has also been aggressive in its definitional assumptions of cause of death…tending to default to C19 in the absence of actual physical evidence.

      I guess my overall point is that the statistical evidence is not pointing all one way or the other…to the extent that your post suggests.

      • MC01 says:

        The one thing that makes this thing so weird is the different rates of hospitalization and death in the same country, let alone across different countries.
        What makes it so lethal in parts of Northern Italy but much less dangerous than a standard seasonal flu in the South? Why Germany has heaps of cases but they are overwhelmingly mild in nature and people recover quickly?
        You can say the same in the US: why is it so lethal in New York City but not in other megacities?
        And finally why are new cases in Northern Italy not merely fewer and fewer but milder and milder?

        Also be very very wary of catastrophic predictions. Here in Italy we were told time and time again it was “only a matter of time” until the South would be as heavily stricken as the North and how average victim age was “about to plummet”.
        Neither happened.
        Doom-mongers are having a hard time keeping people scared and have to resort to heavier and heavier threats based on thinner and thinner premises. Read today’s comment for an ample sampling of this.

        • M says:

          Early testing for coronavirus and treatment prevents catastrophic health problems and need for ventilators and more invasive treatments. That is how Washington state, Germany, South Korea, and the more successful countries minimized the severity of and death rate from their infections. Later other places have also started doing this, since the administration finally allowed private accompanies to do testing. Lack of enough testing and early treatment will be our undoing.

        • Happy1 says:

          This is largely an artifact of over or under testing

  33. Unamused says:

    If there is no herd immunity you better get real scared.

    There’s no such thing as ‘herd immunity’. Herds don’t get immunity. Individuals do. Frequently. But not always.

    Don’t get your hopes up about a vaccine. There isn’t one for MERS or SARS, which are closely related, and the anti-vaxxers would disparage it anyway. There’s no effective treatment for MERS or SARS, which makes it very unlikely there will ever be one for SARS-CoV-2 either.

    The statistics say that the US response to the pandemic is so lame it is barely being mitigated. It leads the world in active cases and trails the world in testing. Now that the country is opening up to resume the plunder any possibility of eventual containment is simply out of the question. The virus will be with you, always, and there will be new ones. There always are, every year.

    Collateral damage. Corporatists insist, as do their gaslighted minions.

    How Far Will the U.S. Economy Plunge During Lockdown?

    All the way, for most people.

    The US economy will never really recover because corporatists will simply up the suppression of labor and grab everything they can to make up their losses, same as last time. You can kiss federal social programs goodbye. Poverty is going to go through the roof and stay there. I wasn’t kidding about the US turning into Haiti. A lot of the country was already there.

    The US economy is not coming back. Ever. Any quality of life most people in the US will have will be whatever they can manage for themselves, which isn’t going to be much. Most people will live a dreary existence, nasty, brutal, and short, distracted by vacarious thrills on various screens. Americans will still be able to pretend that they are rich and happy, and will be encouraged to do so. What their lives could have been, and will never be, only more so.

    Americans have the government they deserve, but don’t despair. You’ll have plenty of opportunity for that later.

    • Escierto says:

      Your assessment is probably a lot more accurate than the Pollyannas and the Die for America crowd.

    • sunny129 says:

      I thought I was the only cold realist here but you changed that.
      What you are stating is scary unfortunately, many are in denial, descending down, day by day!

      Hope for the Best but prepare for the worst!
      All the Best for you!

    • Happy1 says:

      Your statement about the US response and testing is not factual.

      The US is in the middle overall for testing per capita, behind Germany and Italy, but well ahead of France, and the UK, and just ahead of South Korea in the last few days, far ahead of Japan. On a per day basis, the US is now ahead of almost all countries in testing per capita, trailing Italy and Sweden only among large Western countries. So the US is not “trailing” on testing at this point, and by almost any measure is now “leading”.

      The number of cases per capita in the US is substantially lower than in most of Europe. We lead in cases because we are a larger country. And the curve is bending here on roughly the same trajectory of Western Europe. And it’s well documented that much of Europe has undercounted both cases and deaths by large numbers, particularly in Italy and Spain.

      And in the ultimate measure of response, the US is doing better than every large country in Europe except Germany in deaths per capita, by a factor of more than two for Belgium, France, UK, Spain, and Switzerland.

      Comparing the US to Haiti is laughable. Do people risk their lives and travel thousands of miles to jump fences by the thousands to get to Haiti? Please.

      And the US will “never recover”? Would you like to make a 20 year bet?

      • Unamused says:

        On a per day basis, the US is now ahead of almost all countries in testing per capita

        Catapulting the propaganda. Worldometers dot info says the US ranks 43rd, behind Russia and Slovenia. NBC news says “the virus has as of Saturday killed more than 20,000 people in the United States — for the first time surpassing the toll in Italy.”

        We can see what you’re doing here. Same old same old. As your master explained, if you tell a lie big enough and keep repeating it, people will eventually come to believe it. The lie can be maintained only for such time as the State can shield the people from the political, economic and/or military consequences of the lie.

        And you’re long past that point. You can no longer maintain the lie.

        It thus becomes vitally important for the State to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie, and thus by extension, the truth becomes the greatest enemy of the State. So get to it.

        And the US will “never recover”? Would you like to make a 20 year bet?

        You don’t have twenty years. How about two?

        Payment in hyperinflated fiat not acceptable. Put your gold in escrow at Compagnie Monégasque de Banque and we’ll talk.

      • Unamused says:

        Comparing the US to Haiti is laughable.

        Yeah, maybe that was unfair to Haiti. They don’t keep children in cages. They don’t keep millions of people in cages. Nobody criminalises poverty like the US.

        I’ve seen the slums, the decrepit cities. Tall white mansions and little shacks. I’ve seen the despair. Put a sock in it.

    • fajensen says:

      Does it now worry anyone at all that the advanced Asian countries, those that build all our stuff, now, they *can* do testing, they *can* do PPE, and they can even do containment, while not crashing their economies.

      Whereas All that we can do is to whine about how we cannot do any of these things, and even if we could – it would be bad for “the economy” and besides that we are so special that nothing would work here!

      In my opinion, if we don’t sharpen up on our end, on what we control, real fast, those Asians will by the end of this decade be holding the good parts of the worlds economy and manufacturing.

      They have seen what actually happened with the supposedly superior ‘Liberal Democracy’ and ‘Capitalism” during a real crisis.

      Based on that experience, they won’t even bother pretending that any ‘western values’ has relevance at all to anyones future. We will be like those Marxist Monks preaching useless, dead, genocidal ideologies to a few faithful in a rented basement room.

      Which means that we, and our way of life, are both fucked. IF we don’t sharpen up and get our shit in order!!

    • Greg Hamilton says:

      According to a 2005 NIH study, there was something effective for SARS. From the NIH website:

  34. DR DOOM says:

    I hope the economy plunges down to a depth to not hear about a $1000 milkshake or the lack of avacodo for toast . I fear Karma will be a bitch before the dust settles.

  35. Joe in LA says:

    Wolf, is there any way to track how much money is in play with the Primary Dealer Credit Facility (PDCF) loans using stock as collateral? I don’t see this information on the NY Fed website and I am unclear what size role PDCF is playing in propping up the silly stock prices. Thank you!

  36. kitten lopez says:

    Unamused… everything is CONTEXT, right? i’m starting to seriously doubt your assumptions on what The Good Life is (or was).

    This hasn’t been it.

    While i agree with you about where things are going, i think EVERYWHERE is going to be Haiti, so when you’re all in the ghetto… well, it kinda ain’t so bad. how great was all this now? and for whom?

    part of the reason i died as i was ten years ago, is because i figured the rich people i knew just weren’t the happy ones. surely somewhere there were the Happy Ones who made all this crap and this lifestyle and these manias and psychoses and constant wars and oppressions worth it.

    it’s so perfect you writing ahead of me typing this out because i was just starting the write on my own blog even though writing on it BORES me to no end, but while i was checking the NYTimes to see if we’re still here, i noticed Marina Abramović has just been banned from Youtube and i got it… i FINALLY got the confirmation/sign i’ve been waiting for to see whether my dream is just a fantasy or a premonition or a KNOWING that novelists seem to cultivate after years of channeling “stuff” and babbling in tongues often scary to ourselves.

    i knew it was feeling different and i wanted to be quiet and FEEL the real world and the internet and see the differences between the two.

    well, i will go here on the line, Unamused, and challenge you to an Existential Duel and say that while i AGREE with you, i say this is also the BEST Thing that could’ve happened. we needed to STOP.

    The internet has taken over us and how we think and it’s related to the BS stock market and BS websites and BS information (NYTimes is just gasoline to every coherent idea. they make The National Enquirer seem legit and i know people who work there and i used to be in AWE. now i’m embarrassed like REALLY?)…

    James and i are the only ones without magic phones and while many are doubling down on their screen addiction, many others are coming back to forced life. sometimes you end up on your back with your eyes rolling behind your head with slobber down your chin but… sometimes that’s what it takes.

    so i guess i’m saying that i also just heard from my fifth artist who’s swinging with this and even though they’re broker than broke from these lockdowns, they’re EXCITED. they can FEEL the energy and life and excitement coming back.

    i KNEW i was here to give back to San Francisco for all that this city gave to me. it MADE me as big crazy as i am and i owe it the andrenaline needle in the heart BACK. that’s also why i danced. in honor of Emperor Norton NO LIE. i loved him the first moment i heard about him not long after moving here.

    i was gonna carry on the spirit.

    and now things are going to get INTERESTING again.

    if you read one of my favorite creative andrenaline-to-the-heart books, Rollo May’s “Courage to Create,” you realize you NEED the darkness the terror the ability to swagger past your embarrassment to a bigger VISION. that’s what ART and POETRY is for! this is why they kill the POETS.

    and the Internet has made whores of our poets. i can’t even RECOGNIZE my old friends in the business anymore because their defiance is … “old,” hackneyed. the internet trains thumbs up status pigeon like craving for “do you like me?” and that’s why i hate how the numbers make us invisible to the individual magics.

    and Marina Abramović’s banishment from the internet for being considered a satanist when i know she’s a high priestess of this Love as Art thing that i practice in daily life writing dirty nasty platonic love letters on the low to those who CRAVE and need the inspiration and magic of them in a sexting world?

    what i did in private i do in public now and i enjoy the responses. it’s like stripping people in public.

    so San Francisco i know for sure is about to get INTERESTING again. you cannot ban someone like Marina Abramović from the internet and NOT have that be a sign that the Monoculture of the Internet is over because she would create in a CAVE because that is how she breathes. / takes one to know one. (Right, Petunia?)

    and thus a new Underground or MANY undergrounds are about to re-emerge. like the 1990’s and late ’70s in NYC. i “feel” it. / i’ve been both of THOSE places before.

    artists need cheap rent. / shitty for many of YOU here. but divine for many of us who’re about to slip into homelessness because in america it’s now a short little hop from apartment to car and bad forever fico score. i’ve seen it. i’ve lived it. and i’ll see it again.

    but we need cheap rent and no flying and free time and boring internet that people admit being at home reading most stuff is like being caught smoking and then being forced to smoke a pack of cigarettes–one cigarette right after another til you puke.

    no one’s been DOING anything. i’ve been off the magic phone for a decade waiting for everyone to come BACK. San Francisco has been full of zombies looking DOWN in the most beautiful city in the WORLD. tech killed EVERYTHING and made whores of us all.

    what is now is what i felt inside for over ten years. it’s out in the OPEN. and now well…. Wolf i won’t say it. (smile) we’re ALL … in the same situation.

    i think this is what we needed to be HUMAN again.

    i remember living in the Bronx in the late seventies. i dance because i saw guys dancing spinning and being superhero dancers in the streets. i thought it was EVERYWHERE and i’d dance LATER. i had to behave like a good girl so i kept myself to myself (mostly).

    but LATER never came…

    LATER is here now, y’all..

    don’t listen to Unamused. he’s FUNNY snarky but… is that fire protein? will it get you swimming across the bay or will you look great for not daring to give a fuck about something and embarrassing yourself?

    Good RELEVANT art thinking and NEW IDEAS for how to get out of this stuff beyond small ideas made by people with minds constricted by their BS and what they can sell.

    witchery and premonitions maybe they ARE just fantasies, right? i mean look at the magic BS of what Wolf is tallying up the death of america. how did this come to BE???

    Karen’s work is exciting because she’s a bridge off of what Wolf does from “just the facts, ma’am” approach to something that … is willing to go into the whole of …

    well, motivation.

    so there is a power shift already in so much. other women here have mentioned it in that “knowing” way of Petunia and Lisa Hooker. and i LISTEN TO THEM. some are just blowhards spouting fear. i can tell feel the difference.

    so there is my premonition. / and i wrote it here because you CAN’T make a dime off it. that’s the beauty.

    but it DOES mean that shit’s about to get a whole lot better as it gets worse. the renaissance is right there with it.

    but we’re all changing and there’s gonna be a lot of bad stuff. but thing is, there always HAS been. a lot of you never noticed because you thought you were on top.


    we’re ALL xxxxxx’x now…. you fill in the rest or turn that into kisses. it’s BOTH. i’m showing you duality and complexity.


    and for those of you who’re freaks and grumbling on the side about how crappy art and music’s been? five of us from all over the city are already feeling the different vibe. people are HAPPY. yeah. even the homeless heroin addict guy who nods out in his wheelchair while i ride by. even THEY feel it.

    life gets better when we’re all more empathetic from the suffering. you all with magic phones have mostly been complete assholes to each other these past dozen years. you all don’t even NOTICE it.

    life will get 1000% better if this covid shit makes you realize just THAT one thing. / internet people are BORING. they were boring when they were just the popular lunch table people. they NEVER had anything funny or smart or INTERESTING to say! hanging out with them was interminably BORING.

    that’s what life in the WORLD has been like. everyone’s been assholes to each other.

    it’s already stopped out here in San Francisco.

    the city’s coming back. / others are already talking of giving it tender loving care. San Francisco you love like… man San Francisco you love like a DEITY. a being or spirit. others have this, too. you get DEDICATED to this place.

    when the art scene was on its last breaths in early 2000 here, i spoke with my friend in the Castro about where’s the underground now? he said, “well, your job now is to MAKE the underground.”

    i wanted to scoff, roll my eyes, laugh, be glib, make a joke, but Peter from City Lights Bookstore stared and never flinched. and i got it.

    don’t ask what San Francisco can do for you, ask what YOU can do for San Francisco.

    it’s back to that.

    we each are answering that where we are.

    this all HAD to stop. life was miserable. and i missed so many of you in real life!

    and i’m also quitting the internet writing on my blog more and more because i want to live and do business locally… give mouth to mouth to my city my Real Life.

    Don’t listen to Unamused. he’s going through an expected and necessary phase of Despair and “The World is Over.” / it IS.

    but what i hope hangs people on is that if these goverment fucks can’t handle anything? then it’s like having oblivious parents you know how to hide things in front of.


    not even me.

    but i felt the confirmation i needed to see enough of the artists philosophers thinkers who’ve been sitting out this Tech Monoculture of Death, well… You’re UP! / you can’t take enough drugs to make SENSE of all this. people will stare at the clouds for the first time and…


    fantasy or prediction? it doesn’t MATTER in the end because as you see with the BS of the U.S. Economy and Those Who Think They Know Everything, you make your reality so in the end it’s ALL magic.

    anyone who lifts weights gets the magic of plain hard work and focus with vision.


    • Unamused says:

      don’t listen to Unamused

      It’s my fate. I’m a Kassandra.

    • RD Blakeslee says:

      “Good RELEVANT art thinking and NEW IDEAS for how to get out of this stuff beyond small ideas made by people with minds constricted by their BS”

      kitten, there are people who “art think” and “get out of this stuff” in seclusion. We can stand our own company but are not hermits.

      Our escape suits well right now, has in past societal distress and will until we die alone (our choice).


    • VintageVNvet says:

      LOVE it Kitten,,, please do keep us old farter, young at heart and in our hearts, in spite of OR because of our need to hear from YOU,,, and all our younger brothers and sisters still in the fight.

      Thank you again and again,,, and thank you Wolf and WS and Karen for your many and continuing insights and the hard works behind.
      Jones ing for SF once again, in spite of going there,,, ahem,,, to visit with the grands in SC and Tahoe,,,

    • Dave Kunkel says:


      In the late 50s and early 60s I was 10 – 14 years old and our family lived in San Anselmo. Every year our parents would take us to North Beach when they closed the whole area off for the “Beatniks” to display their art, play music, and read poetry. It was a time when people actually rode the cable cars to work.

      My siblings and I really enjoyed it and could hardly believe our parents took us there. We learned later that our parents lived in Greenwich village in the 40’s after the war and told us they loved it.

      I hope San Francisco can return to something like this.

    • Lisa_Hooker says:

      Today is that someday you’ve been putting off.

  37. AlbieOK says:

    I despair reading many of the comments here. They’re mean spirited, I’ll informed, biased or a combination. Intelligence, compassion, and stamina will solve our troubles. Ot polemics.

    • AlbieOK says:

      *not polemics

    • DR DOOM says:

      AlbieOK : I noticed your use of (I’ll) . I was reading Enoch Arden by Tennyson and took a quick break to check comments and saw your post. Interesting breach to a past time that caused a present brief pleasure. For the record I wish I was not restricted in ability but to engage in a Polemic argument.

    • kitten lopez says:

      i had to write because like Unamused is showing, being negative can become a habit you can’t kick. / my entire life i’ve been surly and negative about the arc of the mainstream and now the moment has come that i’ve been waiting for, many of us have been waiting for…

      and i covered my head and prepared to burrow under the covers but for the first time in my life… i have to admit i actually think that after some adjusting, things are going to IMPROVE for many of us.

      i read Boorstin’s THE IMAGE and realized how addicted we’ve been to apocalyptic stories in this age of anxiety and frankly i had to write here because i’ve been a doom and gloomer like Unamused.

      but then i had to admit as i went around looked around felt the city talked to people… it’s actually a RELIEF.

      i was singing loudly on my bicycle and two cars drove alongside me for a bit, with drivers smiling. and then a bicyclist rode up to me to say he thought i was a radio and we chatted a bit and then he turned back around.

      it hasn’t been like this here since the mid ’90s. i was starting to think i’d imagined how it used to be. nope.

      actually Paolo’s stories about his folks on the front porch talking to strolling neighbors at night made me realize we’ve been scared of the wrong things all along.

      but the impersonal brevity of the internet is also made for snarky know-it-all glibness. that’s why i think its days are numbered for anything new and truly interesting and exciting. Real Life is making a comeback.


      • VintageVNvet says:

        AGREE Kitten, better for We the Peons, but if, and only IF We the peons proceed as follows.
        The only way we peons have any chance of a fair distribution of taxpayer wealth will be when we insist that ALL elections follow a constitutionally mandated public program:
        The first and foremost mandate being all elections financed ONLY by public money available equally and completely transparently to all candidates at all levels of all elections.
        The second mandate being a solid/simple/transparent electoral progression from first level, wide open to all interested comers who put on the public website at least one page written by them in their own handwriting and one speech of say 10 minutes; second level from there, all and anyone, to candidates with 10 top vote totals, etc., down to final vote with top two voted for; at each level, each candidate can put up another page or so and another 10 minute speech, with clear understanding any candidate getting a majority at any level wins the election.

        This and similar constitutionally mandate governing all guv mint employees:
        Term limits,
        Equal application/availability of all guv mint programs,
        Language of all laws and rules following;
        need to be in a
        21st Century Bill of Rights, following the ”Declaration of InterDependence.”

        Until We the People vote only for folks supporting this, We the People are going to continue to be, in fact, WE THE PEONS, no matter which nominal political party is in charge.
        Kitten, I for one really think it will take something like this for us to go to the world you envision, as did this old berzerkely guy.

        • kitten lopez says:

          you’re moving too fast. i’m just a scout, i smell the winds, babble in tongue and read the tea leaves and smoke signals and make predictions for myself because i move so slow and try to think of ideas of things to do that will fascinate me for decades.

          others will take over other roles like organizing or leading or inspiring or arguing etc..

          i’m writing you a longer reply below to keep this thread from getting too skinny and long…

        • Lisa_Hooker says:

          Right On VV. Please immediately remit a million dollars of public funds to begin my election campaign. $500,000 would be OK too.

  38. pieter says:

    so you are a large box store and now you just realized you don’t need any of the stores or any of the employees in the stores across all segments of every single industry. University students are realizing they can get any education from any university online(accredited U). Work can be done for service side of all sectors from home or remotely with minimal need for commercial space. Corporations can set metrics for every PC they own for KPI of every single employees that does not need collaboration or labs to work together. Assume all of these corporations are looking and learning to dump labor and capital that isn’t needed as we slow down.

  39. George W says:

    Amazon package deliveries in Utah are down.

    There seemed to be a surge in late March but over the last couple of
    weeks the number of packages/stops I have been assigned has dropped quite a lot. Packaged count/stops always drop in the spring/summers months.

    Sunday, I was assigned 67 stops, today I was assigned 100 stops to the same location. In the past 160 – 240 stops( 180 – 280 pkgs ) was the norm depending on the assigned route location.

    Package count is down but package size it up. The small trinket packages of Asprin( or whatever) have gone missing.
    Ironically, during this crisis I have not seen a jump in bulk purchases of TP, paper towels etc. Also, everyone seems to be in a good mood, kids are out playing. There is no panic in the streets in “happy valley” Utah

    • noname says:

      They are only shipping “essentials” now, other stuff is delayed, supposedly.
      You haven’t seen a jump in bulk TP and PT because they were completely sold out; all stores online have been for many many weeks.

      • George W says:

        Amazon has a very robust supply chain and I never saw a spike in TP, PT deliveries.

        Also, the Dollar Tree in my neighborhood has always had an adequate supply of TP, PT. Quality is iffy but it is there to be had.

        The consumer’s mindset is in the toilet while the fate staring them in the face, is about to get much more real.

        • noname says:

          You aren’t understanding. You didn’t see an uptick in TP/PT deliveries because they were (and still are) literally sold out. There is none to be bought. That is why you didn’t deliver any.

          Walmart, Target, Staples, et al, the same.

    • Cas127 says:


      Thanks…it is always useful to get some first hand Stat reports.

      I wonder if Amazon doesn’t move much TP/paper goods because over the last 4 years or so, it has become noticeably less price aggressive (trying to up its thin margins). Internet buyers tend to be pretty price aware…and marked overpricing can actually be…insulting.

    • George W says:

      Flex driver deliveries have rebounded recently and this is where I suspect the bulk of Amazon recent hiring has been funneled. The line of flex personal vehicles vanished after xmas and have now returned.

      Flex drivers use their own cars, deliver a smaller number of packages but can do so quickly. I always thought they were used to deliver packages to the most remote regions where it would make no sense to send a Prime Sprinter van to deliver one package.

      Whole food deliveries and other perishable food deliveries are better served by a flex driver than a loaded down sprinter van.( just speculation on my part )

    • California Bob says:

      Here in California’s Central Valley–California’s own slice of Idaho–there is no panic, either. People are, however, wearing gloves and respirators and observing reasonable ‘social distancing’ and hygiene precautions, but there is no panic, and most people are as cordial as you treat them (hardly a new development).

  40. SocalJim says:

    The stock market is sending the message that the lockdown is nearly over. People are going to come out of hiding and learn to live with the virus lurking in the background. A recent report has shown the virus hates sunshine and warm humid weather, so expect an easy summer followed by a tough winter. People will decide suburban life is preferred to urban living, and warm climates are superior to cold ones. Real estate prices will adjust … up in suburbs, down in urban locations. Sharing is out. Life will go on. Stocks will hit new highs and life will just be different. The doom and gloom crowd will have to wait.

    • Happy1 says:

      There is no data to show what you suggest about weather yet.

      Agree on the urban environment taking a hit though. I can’t see Manhattan being what it was before for several years.

      • SocalJim says:

        Yes there is. If you go to google and you enter “Sunshine kills coronavirus ‘very quickly’, new govt. test find” you will see the report. This explains why southwest states are doing so much better than northeast states when adjusted for population. CNN keeps throwing mud on this theory because of politics, but it appears true. But, you have to worry about next winter.

        • DrKildare says:

          Do you always believe everything you find by Googling? Singapore, in tropical Asia gets 10-12 hrs of sunshine per day, and 32-35 deg C temperatures … except when it rains. And yet, case counts have exploded since early April. This was after the country had managed to keep a really good handle on case counts during the start of it all in January. The recent explosion in cases is from construction and other workers housed in dormitories, with 10-20 workers per room in some cases … i.e. people unable to avoid safe distancing, etc.

    • Wolf Richter says:


      I think the timing of your comment is a little off. Stocks are down something like 5% in two days. So if this is any kind of message at all — I doubt it because the stock market is a dumb-f**k when it comes to seeing anything in the future — it’s not: “all is hunky-dory.”

      • Keepcalmeverythingisfine says:


        He’s probably more right than wrong. It’s logical that people adjust and there will be a big surge in healthy living that involves boosting one’s immune system. This may mean getting more fresh air and sunshine, better diet, less crowding, etc.. You can already see it in Google search stats. Young people can certainly pick up and move, that’s what I did before getting married and starting a family. With or without a vaccine, humans will adapt and strive for a better life.

        As far as where we are in this particular bear market, every day that goes by now looks more and more like the bottom is in. We’ll probably get some ugly days and some scares that test the bottom. I have no data to back this next statement up, but here goes: The “give me a second chance to buy the bottom” crowd is thick. On top of this you have that bad feeling about sitting in low yield cash accounts while the Fed prints because you experienced the QE1, QE2 and QE3 effects during the last bear market. There’s obviously a lot more upward pressure on stocks than that associated with earnings and top line numbers. In a bear market, the level of the S&P 500 index rarely makes any sense relative to P/E ratios or top line sales.

        • They just nationalized the economy and the stock market, or promised to do so, using taxpayer money. Problem these are multinationals who sign no loyalty oath. The next crisis is government spending. Half the nation screaming to end government, after bailouts went mostly to these offshore entities and their shareholders. Stock market makes new highs and Main St in line at the soup kitchen. Corporate Amerika will not protect you against anything. Does the market even have a right to exist?

      • Unamused says:

        the stock market is a dumb-f**k

        If they’re so smart, why do they need so many trillions in tax cuts, corporate welfare, and bailouts and STILL have such a hard time staying solvent?

        I know these guys. They’re at least as stupid as the traders and hedgies losing their asses in the petroglut. They just have more money, and if they couldn’t cheat it out of the disempowered and the desperate they wouldn’t have any. They’re confusing bottomless greed and magical thinking with intelligence, and they are easily confused.

        And these are the guys running the US economy. No wonder the country is in such deep doo-doo.

      • SocalJim says:


        Yesterday, I walked my dog to a small private waterfront park near my home in Newport Beach. I watched a Range Rover pull up. A wealthy mom and her four kids decided to violate the lockdown and hit the park. The kids all had masks and gloves. The mom kept giving orders … “Don’t go by people” … “Leave your masks on” … Don’t take off your gloves” … “Don’t touch that”. Then they packed up and left.

        That is when I realized the lockdown is almost over and society was adapting. This mother was teaching her kids about survival just like your mom tought you to stay away from cars. The oldest was about 7. When those kids grow up, they may have hardly remember what the world was before the virus. They may never experience a packed sweaty dance floor. But, they will survive and the world will go on. There will be change but people will still invest and stocks will still go up. There might be some investing pains between now and takeoff, but the takeoff will occur in a reasonable amount of time.

    • Joe in LA says:

      You seem to be relentlessly flogging a position that has no basis in observable reality. Are you just upside down on a bunch of expensive properties?

    • Jdog says:

      You seem to have the impression the market is an entity unto itself.
      The market is a reflection of peoples confidence in the future.
      When people are over confident, you see LSD level valuations. That means you would have to be on LSD to think these valuations make any sense.
      In times when reality bites and asserts itself, people realize that stocks are only really worth 7 to15X earnings.
      The problem is, in times like now, when deflation hits, companies lose money. How do you value a company with no earnings.
      The market has gone up over the past few decades based not on fundamentals, but on the greater fool theory that some moron is going to pay a higher PE than you did when you foolishly paid too much.

      Everything has a intrinsic value. Some things have a perceived value. When those two values diverge, one of them is wrong.
      There is no such thing as a pendulum that only swings in one direction.
      I feel sorry for people who are too heavily invested in the market and fail to see what is coming. Reality does not care if anyone believes in it or not.

  41. lenert says:

    Crosby, Alfred W. America’s Forgotten Pandemic: the Influenza of 1918. E-book, Cambridge, UK: Cambridge University Press, 2003

    (Chapter 15 An Inquiry into the Peculiarities of Human Memory)

  42. Jeff T says:

    To quote Doris Day “que sera sera”.

    • Actually it’s an old Spanish saying, repeated recently by President Obrador when the US agreed to assume Mexico’s share of oil production cutbacks, even while a fleet of Saudi Tankers was heading to the Gulf Coast. Not his, but ours. “When oil is $30 this summer, we have revenue, SI! While you might wonder where is my oil?” Que Sera Sera…

  43. Island teal says:

    Everything changed the weekend of March 21-22. Actually started 2 weeks prior. That was the start of the reset. As Fredrick says “Got Gold?”
    Maybe some Silver also……

  44. historicus says:

    Our stock market, pre virus Dow 29K, was like the guy cleaning his gutters, on the very top rung of the ladder, and reaching just a little farther for that last leaf.
    What was the Fed doing QEing, slashing rates, and REPO madness when the Dow was 29K?
    They made the fall worse, with their unwarranted antics.
    Now, the Fed is acting more as they should, to their intended purpose of systemic rescue. Over acting perhaps.
    How can they hold interest rates at all time lows, with 6 Trillion and more Treasury debt to be sold, and presumably absorbed to the balance sheet?
    The credit market break could make the stock break look minor.
    The Fed has set the rules for the interest rate game, and now they are playing catch with themselves. They find themselves the only buyers at their dictated levels.

    • MC01 says:

      I’ve started reading some reports that government and central banks may actually cause more harm than good by blinding throwing money around the way they are doing. Basically just help people pay the bills and give businesses a fighting chance right now and when the lockdowns are started to be lifted see which sectors may need bailouts or stimulus.

      The worst part is that as long as all that money remains contained in financial markets, real world consumer inflation remains more or less under control. But what happens when the levee breaks (since we are in a Zep mood of late) and that money spills into the real world, precisely at a time when pricing is already affected by lockdowns and millions are out of work or on a reduced salary?
      Everybody loves FIRE inflation, but nobody likes real world inflation, especially since CPI and PCE have become poor indicators of it.

      PS: there’s now a nice little robot you can send in the gutters to do the job for you without falling down and breaking your neck. Perhaps the Fed should buy one as soon as the containers start arriving from China? ;-)

  45. Konstantinos Spingos says:

    New Quarantine-Economy is one thing and the aftershocks of the sharp transition on the leveraged old economy seems to me that it should be another one. Although we need the first one for long-term predictions, we should add both in order to have a short to mid-term prediction. I mean that the -11 from your March zero-line is now just the new baseline on which we expect the aftershocks of deleveraging (possible to map on the 2008 recession curve).

  46. Unamused says:

    So far it has been only self glorified scientists and docsters seeking importance in the corporate media who have dictated the martial law lockdown.

    There is no ‘martial law’.

    Scientists and doctors are not ‘dictators’. That job’s already taken.

    You might like to be careful about insulting doctors. You’ll need one after testing positive, and you don’t want them refusing treatment, assuming the scientists can come up with one.

    No serious challenges to their unelected edicts have been allowed in the social media that pretends to be democracy.

    Social media doesn’t pretend to be a ‘democracy’. It’s corporatist. It’s the US that pretends to be a democracy.

    Rational thought requires questioning.

    Do tell.

    • otishertz says:

      Docsters in the US are useful idiots and pawns of the insurance industry who regularly allow the financial entities that pay them to supercede thier sanctified medical opinions.

      • Unamused says:

        What are doctors supposed to do about it? Quit? They’re already doing that.

      • Anthony A. says:

        A doctor fixed my Super Ventricular Tricardia (SVT) last year (thank God). A doctor replaced my arthritic hip this year.

        I love those guys and gals!

    • otishertz says:

      “Rational thought requires questioning.”

      unamused: “Do tell.”

      If you don’t get that statement at first read I can’t respond in any way that will help you.

      You comment a lot. Go outside.

      • Root Farmer says:

        “Rational thought requires questioning.”

        A fine statement, a little empty, but fine enough, by itself.

        Presented in a context of hyperbole and outrage, it is less than meaningless and unworthy of this site.

        Plenty to be outraged about, but what do you plan to do about it?

      • Unamused says:

        I can’t respond in any way that will help you.

        Tell me something I don’t know.

  47. Unamused says:

    Let’s see . . .

    Jan. 22: “We have it totally under control. It’s one person coming in from China. We have it under control. It’s going to be just fine.”

    Jan. 30: “We think we have it very well under control. We have very little problem in this country at this moment — five — and those people are all recuperating successfully.”

    Feb. 10: “Now, the virus that we’re talking about having to do — you know, a lot of people think that goes away in April with the heat — as the heat comes in. Typically, that will go away in April.”

    Feb. 23: “We have it very much under control in this country.”

    Feb. 24: “The Coronavirus is very much under control in the USA.”

    Feb. 26: “So we’re at the low level. As they get better, we take them off the list, so that we’re going to be pretty soon at only five people.”

    Feb. 26: “And again, when you have 15 people, and the 15 within a couple of days is going to be down to close to zero, that’s a pretty good job we’ve done.”

    Feb. 27: “It’s going to disappear. One day — it’s like a miracle — it will disappear.”

    March 4: “[W]e have a very small number of people in this country [infected].”

    March 7: “No, I’m not concerned at all. No, we’ve done a great job with it.”

    March 10: “And we’re prepared, and we’re doing a great job with it. And it will go away. Just stay calm. It will go away.”

    There are hundreds more. All shapes and sizes.

    The truth hurts.

    But the lies kill.

    And he’s still doing it. Apparently the guy doesn’t have enough blood on his hands.

    Meanwhile, doctors and nurses are threatened with termination if they complain about shortages of equipment and supplies. So the coverup is well under way.

    • El Katz says:

      You forgot:

      2/29 “Masks won’t help against the spread of Coronavirus”.

      1/31 “No need for measures that “unnecessarily interfere with international travel and trade” @WHO

      1/31: “The Trump Administration’s expansion of its outrageous, un-American travel ban threatens our security, our values and the rule of law. The sweeping rule, barring more than 350 million individuals from predominantly African nations from traveling to the United States, is discrimination disguised as policy,” Pelosi said in a statement.

      Politics kills too…..

  48. Karen says:

    Here’s the fundamental problem, as I see it. Central banks have been trying to address deficiency in demand (caused by slower productivity/demographics/wage growth, as well as rising inequality) through debt accumulation.

    This is self-defeating, since it (a) simply moves future demand forward; there’s no increase in long-term consumption given rising private debt burdens; (b) allows continued oversupply by keeping zombie companies alive. The result is self-created debt-deflation by monetary policymakers who are so embedded in their dogmas they can’t see the world around them clearly. Translation: they have their heads up their asses.

    Until debts are defaulted and/or written off, and wealth is somehow rebalanced, we are not going to see a sustained rise in private spending and inflation. Unfortunately, history suggests few examples in which this occurred cooperatively. Happily, the US in the 1930s-40s is one of them (although we had special advantages). Usually “rebalancing” involves violent upheaval.

    • Karen says:

      P.S. In response to my Friday post, one commenter doubted my sincerity in saying these things, given my background in the “establishment.” I think that’s a fair skepticism, honestly, given the hypocrisy in which we all swim in these days.

      I was baptised in the deep end of the neoliberal pool, and swam upward through the ranks for about 15 years. But I pulled myself out of it because I was appalled by what I saw. I learned to base my judgments less on abastractions and models, and more on facts and data that opened my eyes. I’ve been grateful for the sacrifices that my contrition has and will entail. One of my favorite quotes is from Maya Angelou, who advised: “Do the best you can until you know better. Then do better.” Along with the golden rule, that seems to me like a pretty good recipe for a satisfying life.

      • Trent says:

        Thank you for pointing this out Karen. It really is as simple as that, and if you let capitalism work, it generally does the mean spirited wiping out for you. So you get this and i get this, but why do those in charge seem to get this? I do not think its having their head up their asses as you surmise. I think they know what the right thing to do is, but they also know that if they do the right thing, they won’t be “special” anymore. Their will be blood

    • timbers says:

      I agree.

      Those enlightened folks calling for a debt jubilee are way ahead of their time and good students of history.

      It is unfortunately so many here and elsewhere revert back to debt is sacred for us folks but can be bailout at a whim for the elites, wealthy, Wall Street, corporations.

      Just go back to some of the articles here on student debt and look at the comments.

      • Wolf Richter says:


        The US has bankruptcy laws that work fairly well. They’re applied on a case by case basis. They provide debt relief for companies and people, and ownership transfer of assets to creditors. In other words, there is a process as to who among the owners and creditors gets wiped out, and the outline is known up front.

        A mass wholesale debt jubilee of the type you keep promoting and touting here is BS – you still don’t understand that the economy is based on credit (debt), that your dollars are credit, that your assets are based on credit, and that you won’t receive a paycheck or be able to buy groceries if you wipe out all that credit (debt).

        That said, I can see that you as landlord with debt would like for YOUR debt go away in a debt jubilee, and so your thinking may be clouded by your personal priorities.

        • timbers says:

          “The US has bankruptcy laws that work fairly well. They’re applied on a case by case basis.”

          That’s the point of why I think you’re wrong, Wolf.

          How are we going to apply it on a case by case basis when courts are closed? Not to mention chronically under funded. And if they were open and fully funded, case by case is not the same thing as a broad based policy response like the one we need to address our addiction to debt fostered by the Fed’s long policy of encouraging it – we need a broad based policy response, not a case by case basis.

          Additionally, case by case existed prior to Covid and yet it didn’t stop us from reaching the point that Karen refers to – too much debt. Caused by bad laws on student loans in particular, and Fed policy in general.

          The problem is too much debt. And credit market you refer has been broken by a policy of too much debt. The credit “markets” got us here, and they are going to save us. They need to fixed so they can work again.

          Take student loans. They were deliberately made much too hard to dissolve. That policy needs to end. But in addition to that, we must acknowledge the failed policy and do a broad based debt jubilee with student debt and other debts.

          BTW this is not my idea. I’m much too lacking intellectually to invent it. I read it from others with much better credentials than mine. Most recently Michael Hudson. And it’s been used in the past to re-set economies that are in places similar to ours and for example Japan, and should have been used for Germany after WWI.

          It’s been done before, and worked.

        • Wolf Richter says:

          The solution is simple: STOP the friggin bailouts and let the market and bankruptcy courts do their job.

          Defaults can happen right now, no reason to wait, and they’re happening, and you can file for bankruptcy right now too (companies are doing it), or you can wait until the court system is back in full operation. The past bailouts and low interest rates created the pile of debt, and that cycle must be stopped. Just say no to bailouts; plus raise interest rates above the rate of inflation and let the system work.

          The whole concept of a debt jubilee is just a huge pile of BS in a modern economy.

        • Icanwalk says:


          Do you think an overwhelmed bankruptcy court system will be part of the new normal?

        • cb says:

          Wolf said: ” that your dollars are credits ”

          This makes no sense to me, though I’ve heard it before. I own dollars. They may have been introduced into the system by the extension of credit (or the receipt of debt), but somewhere within the system they were freed, and I now own them free and clear.
          They are not credits, unless I decide to lend them. They are fiat, and are subject to becoming worthless, as they have been becoming steadily worthless for decades.
          A debt based money creation seems to be a bad system. Leads to corruption and concentration of wealth, a killer of free markets.
          I appreciate you pointing out a debt jubilee wipes out assets of creditors. In some cases, perhaps it should; it is convenient though, that some who like their debt to wipe out the assets of their creditor, don’t want to relinquish their assets which secured their debts. Landlords have a knack for seeing things to their advantage.
          Never a lender nor borrower be. There’s a reason that was called out in the good book.
          If you bother responding to this post, I will probably never see it. With the volume of your writings and the participation of commentors, it’s hard to go back and followup.

        • Wolf Richter says:


          Your paper dollars = “currency in circulation” on the Fed’s balance sheet, where they’re a “liability,” in other words a debt that the Fed owes the holders of those dollars. Those paper dollars are called “notes” for that reason. On the top of the front side of every dollar bill, it says “Federal Reserve Note.”

          But for the holder these notes (you and me), they are an asset.

          Similar to a Treasury security or any other debt instrument: for the issuer, it’s a liability (a debt); for the holder it’s an asset. Every debt is someone else’s asset. That’s the credit system a modern economy is based on.

    • Not sure why this is isn’t widely believed, lowering interest rates causes deflation. Higher interest rates correlate with inflation. Higher rates tend to make credit tight. The issue of private debt, which ends with the persons life, and public debt, which must be rolled over must be addressed. Entirely possible children will someday inherit their parents debt. Money as a liability is one feature of that outcome. Someone suggests that after we receive the $1000 check we will need to write one to the IRS for $40000. Without revenue this government will fail, and soon. Covid pushed the hands on the debt clock forward.

      • Unamused says:

        Without revenue this government will fail, and soon.

        That’s the idea.

        Autocracy will solve all your problems overnight. No, really. They will magically disappear.

      • Jdog says:

        Lowering interest rates does not cause deflation, it only lowers inflation. The only thing that causes deflation, is debt destruction.

    • Bobber says:

      The tried and true mechanism for rebalancing is tax policy. For some reason, though, a majority of the population thinks rebalancing through tax policy is evil even though wealth concentration is the highest ever.

      30 years of political dogma has been effective, and it won’t go away easily.

      • VintageVNvet says:

        More likely that 50 + years of propaganda and brain washing through TV, etc., are, and have been very effective…
        Which reminds me that I have read that USA is the ONLY country/nation on earth that has NOT outlawed the kind of instant/quick brainwashing ( TV and similar )technique known as ”subliminal” that the Nazi guv mint developed and perfected.
        Wolf, WS, et alia,,, please LMK if this is still the case,,, or, perhaps better for all the folks on here,,, Let Us know what is the current situation with law and practice for various and sundry brain washing techniques around the world.

        Thank you

        • Lisa_Hooker says:

          The insertion of subliminal frames of advertising into television and motion picture video streams was banned in the US in the 60’s.

  49. Mortadell says:

    Thats why I luv Wolf Street, Richter does such great work for his people.
    I’ve been reading WS for many years now and I think I have the heartbeat of this crowd.
    One thing many of you should realize is that you are somewhat insulated from a large segment of society because you have a few bucks in the bank.
    Just give it another eight days and you will see folks who do not have one red cent explode.
    Virus or no virus, economy or no economy, these guys don’t have any money so it better start flowing a lot harder and faster otherwise you’ll see them dropping in the streets
    Just sayin’

    • Karen says:

      I think that’s probably right. Most of us have a few bucks in the bank and are preaching to Wolf’s choir. But I suspect we also think–or othewise wouldn’t be speaking up–that things are about to get a whole lot harder. I further suspect that most of us would like to find a way to make things better, and not just say, “yeah, we were right.”

      With that said, I’d like to elevate the banner raised by Tom Pfotzer last Friday. I have a few ideas; who wants to join?!

      Tom Pfotzer
      Apr 18, 2020 at 9:53 am

      If you’ve read this far in the thread then possibly you’re wondering to yourself “what now?”.

      The economy is tottering, might collapse, might limp on for a few more years. It’s now a “when” and not an “if”. What was once well-concealed is now obvious.

      So, what next? Even if we debt jubilee, jingle-mail, rent-strike…that will give us a moment’s satisfaction, and it will also leave us in fundmentally the same position.

      Most of us are in sinking boats, and torpedoing other boats so they sink (deservedly in some cases) does not patch the hole in our personal boat.

      Please rebut that statement if you disagree.

      What is the next move after the shriek and revolt?

      We still have to devise and implement an alternative. That alternative is currently either undefined or not well known. Therefore the majority of us are stuck.

      It’s clear that we need to invent something else that’s workable. The problem(s) are so big, and involve so many of us, and many of our sacred cows. We don’t know where to start.

      Naturally, we are bollixed by uncertainty and fear.

      What’s a good antidote to fear?

      Develop a clear statement of our common problems would help a lot. Boil the commotion down to a list of five core problems, clearly stated.

      Then generate a list of actions that each of us can take to address those common problems.

      Then go implement those actions, and report back on how things are going, so we can speed up the learning process for all of us.

      We need strategies that each of us can start on tomorrow. Tasks with no external dependencies, no top-down approvals necessary. Steps each of us can do ourselves, starting right now.

      To find that list of to-dos, I think we need to pick a place to start, and a time to start. Please let me and one another know if/when you’re ready to pick a place and a time to start, and I’ll join you and try to help.

      • kitten lopez says:

        YES! YES! YES!
        THANK YOU!!!

      • VintageVNvet says:

        OK, Karen, please refer to my comment on this thread re the basic steps toward a more equitable, fair, etc., society going forward.
        The concepts of ‘The Declaration of Interdependence,” and the ”21st Century Bill of Rights,” are easy to generalize about; clearly, the widespread dissemination and approval by the people of their mandates will not be so easy.
        These documents should affirm the guiding principles of the original DOI, Constitution, BOR, while bringing up to date the very obvious differences in the world, ( if no other than the communications;) while also mandating laws and rules to provide comprehensive and coherent steps toward realizing the equalities and freedoms increased democracy brings to everyone.
        As mentioned elsewhere on here, the fact is that if no other place, in USA, entry to the oligarchy is open to self made folks, Buffett, Gates, Cuban to name a few of the current ones, and as such, is more likely not only to be amenable to these concepts, but much more likely to realize the clear benefit to themselves, their families, and to all global beings and thus support them.
        In any case, my suggestion is to start with a website such as WolfStreet, similarly set up with consistent moderation, etc., etc. focused only on completion of at least preliminary wording of both DOI and BOR and as thorough ”vetting, ” as per extensive intelligent and well informed commentors here and then as widespread dissemination as can be achieved.

        • kitten lopez says:

          i love your MIND, Viet Nam Vet Man! yes. don’t let these ideas get lost in the pile, either.

          and yeah i agree what Tom and Karen started could get tragically LOST in the comments here.

          (this is what i’d seen the Wolf Meets being–annual gatherings for face-to-face or places for thinkers entrepreneurs creative people to start conversations that go different directions all year online.)


        • cb says:

          VintageVNvet said: “As mentioned elsewhere on here, the fact is that if no other place, in USA, entry to the oligarchy is open to self made folks, Buffett, Gates, Cuban to name a few of the current ones, and as such, is more likely not only to be amenable to these concepts,”

          1. A lot of countries have produced oligarchs.
          2. Do we want oligarchs?
          3. What did Buffet or Cuban produce? Is it wrong to contend that a great part of their fortune was made due to financialization?

      • kitten lopez says:

        Karen I’ve been thinking about his offer ever since our dear Tom Pfotzer first posted that, and i WILL eventually take you both up on that but first i have to see what the artist vibe is LATER after things open back up and i see the economic toll and who’s around as i take in the situations.

        i eventually want to collaborate with other business folks with commercial real estate in making/organizing events that have many many people and needs and ideas rolled into collective… i don’t know yet. i need to see what others also come up with so’s i know where to connect and why and what we’ve got that people even would want.

        just saying here now that i need time to revise my own grandiose party artistic and business ideas to see the toll so i can see what to OFFER that makes it worth dryer business folks’ time or money.

        but i want to break the cycle of artists/freaks/poor being the first ones to make a place interesting then they get gentrified. i’d like to discover cooperative ways of inspiring ownership of property for local funky arts businesses.

        but i want to find ways maybe some are working with other small towns/dying main streets to try and make local funky or interesting and new things happening.

        it may take awhile to get to what i see, people hanging on, but someone will be game somewhere and hopefully we can share what we start and inspire/show others how.

        thanks for re-underlining this and not letting it disappear in the stack of chaos questions and searching.


        • Unamused says:

          Tom Pfotzer has been excellent, but I think now he’s into doing instead of talking.

      • mtnwoman says:

        Interested. Count me in.
        Thanks for reposting that.

      • cb says:

        Tom Pfotzer said: “Most of us are in sinking boats, and torpedoing other boats so they sink (deservedly in some cases) does not patch the hole in our personal boat.”

        It might not patch the hole in our boats, but it may make it a lot easier to survive, should we ever make it to shore. A lot of big boats deserve to be sunk; ie the FED, Fannie, Freddie, large swaths of Wall Street, Lobbyists, Corporatists and other boats that suppress citizens through debt slavery.

        The problem is DEBT!
        The contributors to DEBT is the bad distribution of productivity made possible by concentrated wealth and power. The above referenced actors are part of that sickness. VintageVNvet has soem good ideas on eliminating the power brokers from elections.

    • VintageVNvet says:

      u are Key rect on the ‘money in the bank’ part Mort,,, and, in spite of the history of the likely hood you suggest re streets, I hope you are wrong about that part.
      Time and enough for all folks with any sort of focus/brains to understand that, unless and until the ”military folks in charge” get to the point of activity in the streets, there is absolutely no point for anyone else to do so.
      I don’t want to be ”flogging a dead corpse”,,, but, seriously, We the Peons need to discourage any and all activity, other than clearly non violent, in the streets until then, if for no other reason than the very high likely deaths.

  50. Keepcalmeverythingisfine says:

    I would like to share some anecdotal information with you all. I own a small business that designs and manufactures products (in the USA) for the outdoor/recreation market. All the metrics were looking bleak until last week. Things have suddenly turned around and every metric is up significantly (orders, web site traffic, etc.). This is for products that are priced from $300-$1000 each, so a fairly high ASP. I also watch several real estate markets that are fairly expensive, and I am starting to see more SFH listings as states start to lift the ban on in-person showings. I am not seeing drastic price reductions or increases in these areas.

    There are certainly other businesses and areas of the country that are bleak, but things are already turning positive in others. The worst is behind us.

  51. HollywoodDog says:

    I was fortunate to have moved 90% of my IRA funds to cash and gold at the end of last year. (I assumed a reset was coming, but nothing like this.) I am now looking for a mutual fund that is positioned for the post-Covid economy, something heavy on web technology, pharmaceuticals, and consumer staples but without exposure to travel, live entertainment, and commercial real estate. I don’t want to buy into the general market because it’s going to have only a few winners in a sea of losers—as Wolf suggests in this post. Any ideas for locating such a fund?

    • Concerned American says:

      Fidelity select portfolios

    • Keepcalmeverythingisfine says:

      I’ve seen this argument that an index like the S&P 500 has so many losers that will drag down returns. This gets complicated. The typical S&P 500 Index is market weighted (although there are equal weighted indexes now). Stocks that have taken a tremendous beating have seen their market value/weight significantly reduced. They may even get replaced in the index. Meanwhile the big winners are gaining market value/weight, so you are benefiting from that. If you want to goose your returns over and above the S&P 500 Index with other ETFs and Index funds you have your work cut out for you. It is not easy at all.

  52. Canadian says:

    The era of high fixed costs is over and done for.

    That goes for retailers with expensive real estate, outrageous home prices in expensive metro areas, fancy corporate glass palace offices, gold plated defined benefit pensions (especially public sector), high property taxes, and so on.

    The future is digital, networked, teleconnected, agile, fast, constantly shifting and highly adaptive. The old trappings of the legacy economy of the 19th and 20th centuries were already zombies — COVID has felled them.

    • Xabier says:

      ‘Agile, constantly shifting and highly adaptive’?

      Might be right if you are thinking of hunter gatherers, maybe even pastoralists and nomads.

      But not the LAST stage of industrial civilization -ours – which will sink under the weight of its own complexity.

      • Canadian says:

        “Industrial civilization” is 19th and early 20th century. “Hunting and gathering” is not its alternative.

        We live in a digital age now. The creative designing your marketing campaign can be in a farm in Nebraska, working via 5G. Your designers can be in Georgia, New York and Alaska collaborating via the Google Suite. And you can produce your product with a 3D printer or lights out factory wherever is most convenient.

        Many Americans still believe “we” are an industrial economy, but we aren’t and haven’t been for decades. A drive through Detroit, Tolleson, Cleveland, Philadelphia or any other industrial has-been city is proof of that.

        The knowledge economy has finally arrived. Infrastructure and high fixed cost “scale” from the industrial era is a millstone that is drowning the old order.

        Long term debts for costly millstone assets are going away; the privileges of the major metropolises over the rest of the world have not only been erased with the emergence of the networked economy, but those metropolises are now at a competitive disadvantage.

        If you hold on to your attachments to “industry,” you’ll drown with it. Better to join the knowledge economy.

        • Lisa_Hooker says:

          As long as someone else invests in your borrowed 3D printer or lights out factory. In other words you’re just a more modern digital

    • VintageVNvet says:

      C’mon Una,,, you, of all people should fully understand that the future does not exist, the past is history (or herstory, if you will) and there is only now, which is why it is called, ”the present.”
      Bee of good cheer old chap,,, no matter what, none of us are getting out of this ”vale of tears” in any way except back to the dirt, ashes, etc., SO we might as well have fun with it / enjoy it, etc., etc.
      and BTW, in spite of your ”mea culpa” elsewhere, there are those of us with a lot more parts missing who continue to “keep on keeping on” enjoying every day on this side of the dirt, etc.

    • Lisa_Hooker says:

      Yup, the future is chaos. What you knew yesterday is obsolete.

  53. Danno says:

    Questions for anyone with a crystal ball or a tin foil hat.

    1. Is there any worry at this point of a bank bail in savings held in accounts? I sold a house last fall and am sitting on 300,000 k split between 3 banks.

    2. Any odds to pay for this mess, the government would ever come after ROTH, SEP or IRA accounts?

    Thank you all for your fine comments and Wolf of course for his great informative posts..Thank you in advance.

    • Wolf Richter says:


      1. You’re fine as long as you keep the whole thing within the rules of the FDIC.

      2. No. Don’t fall prey to the obliterating BS being spread around on the internet.

    • Lisa_Hooker says:

      Social Security was not taxed before 1984. Then the rules were changed. So much for your not-taxable Roth IRA.

  54. kitten lopez says:

    VINTAGE VIET NAM VET (response from above):

    before you start writing a new constitution, people have to Die as they were, first. dreams ideas and power have to go through some bad bouts of trying to go back to the way things were (Biden etc) with all that make up sex and fights reminding you how much you keep forgetting… they will have anxiety attacks and double down til they can’t fake it anymore.

    this is like a Near Death Experience for an entire planet. you can’t just pretend it didn’t happen afterwards like when you’re the ONLY one having it.

    this is a really fucking cool time to be alive because it can’t go “back” to anything it was. people are already losing THE MOTIVATION, what Karen was already touching on.

    and The Stuff just isn’t there. it was about run out anyhow.

    and now that we’ve done without… what FOR all that crap???

    Paolo covered this beautifully i must say. pure POETRY.

    what’s exciting for ME is that The BS Story is finally officially over.

    and i’m betting that this is reminding people finally that they are not Consumers, but human beings. animals on a miraculous planet.

    we need a change in how we SEE the planet, each other, animals, water. we need to go back to love as not faux selfless “altruism”… let me fuck you over now so i can give you grants later and feel great about all i did to fuck you over. that’s so indirect, inefficient. pathetic. look at Geffen. does Geffen EVER look ANYTHING but pathetic in his palatial homes or on his fucking cruise line yacht??? it’s so O-V-E-R.

    it’s time for a new paradigm new STORY. that’s where the poets thinkers artists musicians come back in. and that’s what YOU’RE talking about. this is what i talk about whenever i say we need to go against how THE MEDIA and the elite frame ridiculous arguments into binary BS and realize that we’re not actually on opposite sides so many of us, like they tell us we are or have to be.

    i’m on here quoting Michael Africa without a second thought and people here GET it. that’s when i realize it’s a GOOD IDEA. no good ideas fuck others over. like my mom used to tell me, there’s no point in signing a contract that screws anyone else over because they won’t follow it and ultimately you cannot enforce it.

    and WHY? that’s been america’s WAY… but no more Story to blindly follow. and not enough force to make it so. people not so easily controlled Consumers after all …


    oh. and Irreverent Humor is finally going to make a comeback. THAT is my tuning fork. just baby shoots i can smell under the surface of the soil. someone’s gonna have the balls to go first because they pick the wrong time and they’re toast. this is where those crazy brujo producers used to come in before data driven stardom took over.


    • Lisa_Hooker says:

      No worries Kitten. There will be a great die-off of old people long before their best-before date, thus saving Social Security, Medicare and defined benefit pensions. Which is fine because the young rarely listen to the old anymore.

      • kitten lopez says:

        ..nah, that’s too pat for what i’m laying down here, Miss Hooker. in my vision it’s WHAT GOVERNMENT? i’ll respond below…

  55. Malthus says:

    Too bad that our legal system isn’t so adaptive. A year and a half and still a simple extradition hearing, which should have taken 10 minutes, isn’t decided.

  56. kitten lopez says:

    Miss Hooker and mr Malthus:

    i’m riffing off Karen’s shot about the debt. this whole corona virus thing is what i went through when i “died” as i was. i could barely venture out, i was broke, irrelevant, trying to start fights by chasing and getting out of my car and confronting anyone who honked at me or ran a stop sign past an old lady.

    i’d promised James i wouldn’t go on a suicidal “adventure” to be found dessicated, a half eaten corpse with eyes picked out by crows, feet eaten off by coyotes in the desert. (i fantasized a grotesque death with glee. the more horrid the louder my graffiti scream left behind.)

    so Karen’s work reminded me what happens when you can’t buy in anymore. you give up. live AROUND and UNDER the requirements taken away by wage garnishing or having your drivers license or business license suspended for not paying your student loans.

    there are TOO MANY. and then you end up with rich people with no one to lord anything over and then Geffen’s out on his yacht with one last Uncle Tom going down with him.

    Social Security and Medicare aren’t even IN this equation. i STILL agree with Unamused about where this is headed. but energy was plentiful and you could bring out the tanks on the Bonus Marchers and send ’em off to ride the trains after you fucked ’em.

    but you cannot afford to force anyone when the infrastructure is toast. you’re held together by frayed trust and promises… that just snapped.

    $1200 can cover the beating and loss coming. it’s OVER.

    but i don’t think we’re riding the trains. i think Karen’s right about The People finally Owning the Bank.

    and the elite/powerful/ and rich did this to THEMSELVES.

    it’s like when you deal with a crazy person and let ’em run and incite ’em because you know you sit back and they’ll be their own undoing and you’ll have all the proof you need or whatever.

    anyhow, i realize things are bad and will be WORSE.. but not really… it was already only getting shittier and shittier and more depressing only THOSE deaths haven’t counted as much as covid.

    anyhow so on it being so HORRIBLE if shit goes totally tits up:

    only i’m realizing we’ve been duped by management to vote for our own continued enslavement when THIS crap was horrid and ANYTHING ELSE WILL BE PREFERABLE TO BEING THE PERPETUAL XXXXXX.

    we can handle it. we’ve already been eyeing fido for his fucking BONE as our future retirement.

    i think shit sucks NOW. that’s my premise. and that you can’t convince folks to keep paying on this shit for very much longer and it’s OVER.

    i see underground routes and interesting new things opening up. and THAT will force Viet Nam Vet’s new constitution through.

    you can’t force anyone anymore. we’re tired. when i quit, i couldn’t MOVE. i needed the TIME to mourn the end of The Dream, and My Tiny Dream Within In It… i had to go through almost a decade of losing EVERYTHING to slooooowly build back my life. i’m still doing it.

    so others are coming to that same thing i went through a decade ago. i started washing clothes in the tub after getting beat up outside the laundromat by that gentrifying guy when i was dancing between laundry cycles. so i did wash and home and i cared for what i sewed better and it changed EVERYTHING how i did EVERYTHING.

    it’s happening to the world NOW. this is a power shift. this is what Karen was talking about regarding debtors strike and Michael Africa saying… a REVOLUTION doesn’t have to be blood and guillotines… just don’t need the STUFF.

    that’s where we are.

    this is bigger than waiting asking counting on the government.

    nah, Viet Nam Vet… i think you’re also a fortune seer… yeah… this is Constitututional Level stuff coming up.

    but first things had to and have to lighten up. you cannot come up with any decent idea without staring at the ceiling and zoning out for hours at a time. Bob Mecoy, my beloved editor at Simon & Schuster would tell me that whenever i’d get too German and wanna be so damn EFFICIENT as a writer.

    nah. doesn’t work that way.

    we’re in that Einstein quote about not being able to fix the problem with the consciousness that CAUSED it.

    exciting time.

    Karen’s up front at this. she’s the liason between commerce creativity motivation and reality. it’s pretty cool. listen to her. Petunia’s gonna come out on that, too. she’ll be likely starting new things.

    nah… you old folks are UP. this isn’t a young kids’ revolution. they need help. we turned them into big breasted chickens with tiny ankles and bound useless feet. we’ve gotta get off our own fat asses and show ’em how to dance, think through real world limits and start small.


  57. Jeff T says:

    As of this comment, this topic shows 383 comments. That is the most I recall since I started reading. Congratulations Wolf, you have done a fine job of writing and bringing people’s ideas to this website. Don’t drowned in all that beer money. Thank you.

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