RUTHFULLY YOURS

https://issuesinsights.com/2020/03/10/what-to-do-about-stock-market-meltdown-how-about-nothing/

No doubt about it, it’s a bad time to be fully invested in the stock market. Prognosticators abound, yet no one really knows what the stock market will do next. What’s happening, and what should you do?

First, let’s recap Monday’s market mayhem.

Before the market even opened, stock futures for S&P 500 index flashed a huge 7% decline. That triggered so-called “circuit breakers,” rules that require trading to be suspended 15 minutes to prevent a panicked rush for the exits. That’s always a bad sign.

Equally bad, the Dow Jones Industrial Average tanked more than 2,000 points, off 7.8% at day’s close, while the growth-stock rich Nasdaq Index plunged more than 7.3%.

Why has the stock market suddenly gone so sour, after hitting record highs repeatedly early in the year? The one word reply is: fear. More specifically, fear of the unknowable, fear of what comes next.

The Covid-19 virus’ spread is the main unknown, sending waves of panic through global markets. The World Health Organization says there are now some 110,000 Covid-19 cases worldwide, with an estimated 3,809 deaths.

Another fear relates to the shocking collapse in oil prices and interest rates, usually signs of impending deflation and declines in future investment across the economy. Monday’s near-21% plunge in oil prices was the biggest since the financial crisis, while the 10-year Treasury rate hovers around 0.5%, not far above zero.

https://www.forbes.com/sites/richkarlgaard/2020/03/08/covid-19-and-the-economy-as-seen-from-a-technology-investment-conference/#4c13a064fc7c

COVID-19 infected the American psyche and stocks rather suddenly during the final week of February. Last week I attended at large technology investment conference in California — The Montgomery Summit 2020 — and was eager to see whether investors and entrepreneurs were pulling in their horns. I also moderated two discussions on the pandemic’s likely damage to the economy, markets and supply chains around the world.

My first session was with Michael Milken, the noted financier and philanthropist. Milken was cautious for the short term, but generally optimistic. Computer power for gene sequencing and AI models to predict infection spread, he said, are vastly more capable than during the SARS scare of 2002-2003 and the H1N1 epidemic of 2009-2010, when 700 million to 1.4 billion people became infected worldwide and upwards of 500,000 died. Technology can identify and solve problems much faster today.

Milken cited the U.S. polio epidemic of 1952 and the HIV/AIDS panic of the late 1980s as times when fear gripped the population. “People were afraid to be in the same room with someone infected with HIV.”

Fear, of course, is hard to break. The polio fear persisted a few years after the Salk vaccine. Milken said it was popular figures like Elvis Presley, photographed during his Army vaccine, that broke the spell. What lifted the clouds for AIDS were new drug cocktails that eliminated the death sentence, along with thriving patients such as basketball star Magic Johnson.

Capitalism, reasonably regulated, Milken reminded us, has remarkable recuperative powers.

https://asiatimes.com/2020/03/this-is-a-not-a-panic-but-adjustment-to-a-mild-recession/

Financial panics occur when investors sell what they can, not what they want to. And that happens when they can’t finance their positions. Credit remains freely available for sound borrowers, and the rise in the cost of credit has been orderly – except for energy companies below investment grade.

There is no sign of sudden liquidation from popular exchange-traded funds that buy high yield debt, despite steep price declines. Equity multiples shrank and probably will shrink further as the market prices in a mild recession during 2020. But that’s a far cry from 2008, when major banks levered $2 trillion worth of phony AAA-rated securities sixty-to-one.

The stock market’s 15% fall from its February peak is painful, but not panicky. The coronavirus probably will cause a mild contraction of US economic activity during the second and third quarters, as travel and hospitality businesses shrink, consumers avoid shopping malls, and Americans, in general, save rather than spend as a precaution.

Consumer spending was the only significant source of US growth during 2019, as investment and manufacturing shrank in response to the incipient trade war. Strong economic data for the first two months of 2020, including an exceptionally large increase in February employment, indicated that the US economy was improving after the conclusion of a “Phase One” trade deal with China – before the coronavirus problem emerged.

https://amgreatness.com/2020/03/08/california-is-a-cruel-medieval-state/

One way of understanding California is simply to invert traditional morality. What for centuries would be considered selfish, callous, and greedy is now recalibrated as caring, empathetic, and generous. The current ethos of evaluating someone by his or her superficial appearance—gender or race—has returned to the premodern values of 19th-century California when race and gender calibrated careers. We don’t pay medieval priests for indulgences of our past and ongoing sin, but we do tweet out displays of our goodness as the penance price of acting amoral.

A paradox ensues that Californians both have a high, indeed smug, view of themselves and yet do a lot of damage to their fellow human beings. Their haughtiness is based largely on the reality that Silicon Valley, sandwiched between Stanford University and University of California, Berkeley, became the birthplace of the global computer, internet, social media, and a high-tech revolution. For progressives who deprecate the capitalist lifestyle, having a lot of money still allows one to say one thing and live out the opposite.

The state’s multi-trillion-dollar companies have hired tens of thousands of seven-figure, mid-level executives and computer experts who assume that life in the California coastal corridor is a birthright paradise.

The resulting tax revenue bonanza to the state allows one-party-rule to rid California of the old bothersome Reagan-Deukmejian-Wilson working- and middle-classes by embracing not-in-my-backyard zoning, identity politics, anal-retentive regulations, steep tax rates, utopian green agendas, open borders, and decriminalization of things that used to be felony offenses.

Indeed, the bigger and wealthier California became, the more the rich sought to privatize their lives and to give up on public services, the more the middle classes left the state, the more the poor from Mexico and Latin America crossed the southern border illegally, the more its schools deteriorated, and the more its infrastructure ossified and became decrepit, from century-old power transmission towers to pot-holed and jammed highways.

https://www.city-journal.org/coronavirus-and-the-economy

The spread of the coronavirus has led to fears of a worldwide economic slowdown. China, where the virus first leaped into the human population, has quarantined large sections of the country, virtually shutting down economic activity. In South Korea, several companies—including the automaker Hyundai—closed facilities when workers there tested positive for the virus. The Italian government, meantime, has shuttered schools and universities and banned public attendance at sporting events—including the nation’s popular soccer league—for 30 days. Such responses, likely to spread to other countries as the virus itself travels, have led to estimates that containment efforts could cut worldwide economic growth in half this year. Whether that prediction proves accurate, or whether the toll proves even worse, may depend on how the economic impact of the virus plays out in the United States, the world’s largest and most consequential economy.

The U.S. has already taken several basic steps to stem the spread of the virus, including suspending flights from China and quarantining those returning from areas of the world where the infection is most intense. But as the virus spreads, officials contemplate stricter measures. These include banning public gatherings such as concerts, movies, and sports events; advising businesses to keep workers home; or even shutting down firms where the virus is detected.

It might be easy to justify such draconian measures based on the toll that the coronavirus can take on society. But what’s also worth contemplating is the human toll that a potentially sharp decline in economic activity would exact. While the simplest way to measure an economy may be in dollars and cents, economic activity also produces well-being. A decline in the economy sparks deterioration in public welfare. Those are human costs that must be measured against the inevitable cost of the virus itself. Extended school closures, for example, place a burden on employed parents, who must miss long periods of work; on households living paycheck-to-paycheck; and on the self-employed.

https://www.americanthinker.com/blog/2020/03/in_america_ignorance_and_antisemitism_drive_the_animus_against_israel.html

Samantha Mandeles, the Senior Researcher and Outreach Director at the Legal Insurrection Foundation, has regularly attended AIPAC conferences over the past several years. This year, however, she opted not to attend the AIPAC conference itself but, instead, to report on the anti-Israel protests that invariably take place outside of the conference venue.

What Mandeles discovered after spending nearly four hours observing the protesters and interviewing them is that they are driven by historical ignorance and revisionism, baseless conspiracy theories and, underlying it all, anti-Semitism. This last point is noteworthy because one of the central claims the anti-Israel crowd makes to give itself legitimacy is that it’s not anti-Semitic; it’s merely “anti-Zionist.” Scratch an anti-Zionist, though, and you’ll almost invariably find an anti-Semite.

Because Mandeles carefully documents her conclusions about the misinformation, conspiracy theories, and anti-Semitism powering the protests outside of the AIPAC conference, her article is long and cannot easily be summarized. However, several important points deserve to be mentioned here.

https://thehill.com/opinion/judiciary/486424-how-the-media-ignores-pattern-of-democratic-attacks-on-the-courts

“I am from Brooklyn.” That statement made by Senate Minority Leader Charles Schumer was meant to excuse threats he has made against two conservative justices the day before on the steps of the Supreme Court. His “apology” seemed to be a mix of claiming a license for all New Yorkers to use “strong language” and claiming justification because some justices are “working hand in glove” with Republicans. This was like a bizarre road rage defense from a Brooklyn driver who apologizes for the situation but explains that it was all due to the lousy driving of the other guy.

The problem is that this the latest in a pattern of Democratic leaders attacking and threatening jurists if they rule the “wrong” way in certain cases. Although Senate Minority Whip Richard Durbin advised the public “not to dwell” on the comments by Schumer, there is much more to dwell on than just this incident. Indeed, Democratic senators, including Durbin, have made threats against the Supreme Court and the judiciary.

It is certainly true that the media has not dwelled on these attacks, at least not from Democrats. Another New Yorker has used “strong language” to attack jurists, and many of us have criticized President Trump for those comments. Not surprisingly, Schumer has not cited a New York license for Trump to do as he did, perhaps since Trump was born in Queens. Indeed, Schumer recently denounced Trump for criticizing the judge in the trial of Roger Stone. Schumer called on Chief Justice John Roberts to “defend the independence” of the judiciary from such unwarranted attacks.

https://www.nationalreview.com/news/mark-meadows-new-white-house-chief-of-staff-replacing-mike-mulvaney/

President Trump on Friday named Representative Mark Meadows (R., N.C.) as White House chief of staff, replacing acting chief of staff Mick Mulvaney.

“I have long known and worked with Mark, and the relationship is a very good one,” Trump wrote on Twitter. “I want to thank Acting Chief Mick Mulvaney for having served the Administration so well. He will become the United States Special Envoy for Northern Ireland. Thank you!”

Meadows announced in December that he would not seek reelection after an eight-year run in the House, during which he clashed with former House speaker John Boehner, called for balanced budgets, and was chairman of the House Freedom Caucus. More recently, the congressman has been a staunch ally of Trump, and has called the impeachment proceedings against the president “a baseless, fact-free sham that ignores rules, obliterates precedent, and ultimately runs directly contrary to the will of the people.”