- Prestige media and a glaring contradiction
- Political science: Reframing protests
- “Saint” Fauci’s dubious expertise
- Scientific method be damned
- What Atlas and Big Tech have in common
- Sidelined cash and sugar-high stock market
- Old MacDonald had an… ATM?
- A reader misremembers our gold bug heritage… Independence Day in memoriam… Applause for The 5… And more!
Gee, it took The New York Times only a month to start coming to grips with this rather glaring contradiction…
Way back on June 2, we observed how politicians were giving their blessing to protests that violated stay-home orders they personally issued.
A week later, we took note of how certain “public health experts” said there was no contradiction at all. As one of them put it, “In this moment, the public health risks of not protesting to demand an end to systemic racism greatly exceed the harms of the virus.”
In contrast, anti-lockdown protests were “rooted in white nationalism and run contrary to respect for Black lives,” said an open letter signed by more than 1,300 epidemiologists and health workers.
Only yesterday could the Times finally bring itself to pose the following question in its own pages: “Was public health advice in a pandemic dependent on whether people approved of the mass gathering in question?”
“I certainly condemned the anti-lockdown protests at the time, and I’m not condemning the protests now, and I struggle with that,” University of Texas epidemiologist Catherine Troisi fessed up to the Times.
“I have a hard time articulating why that is OK.”
“Instinctively, many of us in public health feel a strong desire to act against accumulated generations of racial injustice,” added Brown University epidemiologist Mark Lurie. “But we have to be honest: A few weeks before, we were criticizing protesters for arguing to open up the economy and saying that was dangerous behavior.
“I am still grappling with that.”
The Times also cites a piece in The Guardian last month by the essayist and journalist Thomas Chatterton Williams: “The way the public health narrative around coronavirus has reversed itself overnight seems an awful lot like… politicizing science.”
We’ll get back to “science” in a moment. But lest you think we’re straying too far from our beat of money and commerce…
The contradictions are coming into sharp view right now… as the business reopenings in many places are flipping to “reclosings.”
In Miami, the restaurants are back to takeout and delivery only, effective tomorrow. That reversal already took place in Los Angeles and 18 other California counties. In Arizona, the bars were closed again late last month and won’t reopen for three more weeks.
Back to the Times piece: “The lockdown is justified, most epidemiologists say, even as it requires acknowledging a moral truth: To save many hundreds of thousands of lives, we risk wrecking the lives of a smaller number of Americans, as businesses fail and people lose jobs and grow desolate and depressed. The pandemic has also brought an increase in deaths from heart attacks and diabetes during this period.”
Hold on a minute, there. Recall that the lockdowns were first sold to us not as a means of saving lives, but to prevent the hospital system from being overwhelmed.
Only later were the goalposts moved and we were told we’d face on-again, off-again lockdowns until there was a vaccine. (The 5 warned you about this bait-and-switch as long ago as March 27, when the media were still obsessed with passage of the spend-a-palooza “CARES Act”.)
Meanwhile, as we suggested in May, the whole “saving lives versus opening up the economy” thing might be a false choice — certainly on a global basis. The United Nations says COVID will likely kill fewer people than the hunger and non-COVID diseases caused by lockdowns and their resulting economic devastation.
And yet, despite the blatant politicization of science, the default mode for many Americans is still, “Listen to the scientists!”
It’s not as if “the scientists” had exactly distinguished themselves before the protest debacle. If you’d listened to the sainted Dr. Anthony Fauci back on Feb. 15, he’d have told you the risk of COVID was “just minuscule” compared with the risk from seasonal flu. And don’t get us started on the mask debacle.
Apologists for “the scientists” would say they’re simply acting on the best available information at the time and that information could change.
Yes, we get that. That’s the whole point. You don’t issue sweeping mandates affecting the fate of hundreds of millions on an untested hypothesis.
But here we are in early July – 3 and a half months after the lockdowns began in earnest — and the Times story tells us even now, “No one quite understands the path of this idiosyncratic virus and how and when it strikes.” Great basis on which to make public policy!
Back on June 24, when a “resurgence” of the virus began to spook the markets a little bit, we were rather adamant that no one was going to observe “renewed curbs on business activity” given how scores of mayors and governors gave their blessing to protests that defied their own edicts against large-scale gatherings.
But here we are two weeks later. Compliance seems widespread, defiance spotty at best. No need for cops in full-on tactical gear to enforce the state’s dictates.
Are business owners too afraid? Or just too exhausted? Drop us a line and let us know what the vibe is where you are. If you own a business yourself, we’re especially interested in hearing from you.
Once again, Big Tech is doing all the heavy lifting for the stock market.
At last check, Apple and Microsoft are both up about two-thirds of a percent on the day. That’s lifted the Nasdaq about a quarter-percent to 10,458. If that holds by day’s end, it will be another record close.
Meanwhile, the S&P 500 is down a quarter percent at 3,172 and the Dow is down three-quarters of a percent and only 77 points away from breaking below 26,000.
Gold is making another run toward $1,800 — the spot price $1,794 as we write.
“Investors are holding a record amount of cash on the sidelines,” says our Zach Scheidt.
“And that is a big part of why stocks are trading higher — and will continue to trade higher — despite all of the concerning news in our world today.”
Zach directs our attention to a chart of the amount of money currently held in money market accounts.
“As you can see, we just hit a record level of $4.6 trillion — well above the highest level ever seen.”
Thank Uncle Sugar for this record level of money market cash. “With all of the stimulus programs that have been put into place over the last few months,” says Zach, “consumers across the country are flush with cash!
“Savings levels have jumped sharply higher. Because not only have people been given more cash, but they've also had fewer places to spend that cash thanks to coronavirus lockdowns.”
Can it really translate into more stock market gains? No reason it can’t, says Zach. “Keep in mind the last time we saw a record high in money market funds was 2008. This was following the financial crisis and ahead of the longest bull market periods our country has ever seen.”
Meanwhile, it’s the physical kind of cash that’s occupied the attention of a Nebraska farmer in recent days.
It all began last Friday when Wynn Hall drove his four-wheeler down to a pond on his property. The surrounding fence had been cut. Then he saw the large metal box.
Folks have dumped old refrigerators and stoves there in the past; that’s why he put up the fence.
Turns out it was an ATM.
There’s been a rash of ATM thefts in eastern Nebraska of late. The FBI is on the case.
Recovering the evidence in this instance was not an easy task. The pond was drained and a tow truck driver was called in. “The guy ended up stripping down into his boxer shorts and went in there and pulled the thing out with his tow truck,” Hall tells the ABC station in Lincoln.
“I asked him if this is his most strange experience and he said actually he’s had some more – and I didn’t bother to ask what that was.”
“Guys, a newbie wrote to you and asked how to become an investor after years of wondering,” a reader rewinds to last week’s mailbag. We obliged the newbie’s request for guidance on finding an online brokerage firm.
“Don’t you recognize a market top when you see one?” today’s reader implores. “You should have told that sucker to get to know his local coin dealer and buy gold!”
The 5: Give us a break. You’ve been around long enough to know both our gold bug heritage and Jim Rickards’ present-day guidance for a 10% gold allocation — which we repeat regularly.
More to the point… if you’re ready to declare a stock market top, you’re a lot bolder than we are.
Are P/E ratios extended right now? Yes. Margin debt at high levels? Of course. And we were observing the disconnect between the market and the economy long before it became fashionable.
By all accounts, the market “should” be far lower than it is now. But as we’re fond of pointing out, “should” is the most dangerous word in all of investing. Also, see above about the amount of cash sitting in money market funds…
“Happy Independence Day… Some Day Soon!” reads the subject line of an email we got over the weekend from one of our longtimers.
“In spite of our flaws and family squabbles, which we don’t hide but rather post widely for all the world to see, I am feeling pride over what we once were and still may become after we go through some hard times.
“And The 5 is playing no small part in providing all who will hear and act a game plan for protecting themselves from the coming troubles. For free! Amazing value the free market can provide!
“An even more important role The 5 plays, I believe, is in bringing the truth about how fetid and rotten our government has become — BOTH parties and all the unelected deep staters whom we’ve allowed to take over our country.
“The bad news is we’ve allowed the passionate 2% to rule the indifferent 98% of us who want to live in peace with each other. The great news is the 98% can change this and take back our country, with all of its flaws, if we choose. It will first require that we stop fighting with each other and come together to change (gut) the current rot in D.C.
“I have visions of Pelosi and Schumer sipping expensive wines and enjoying other lush decadence with Mitch and crew and laughing about how easily they cause us to fight with each other while they live in opulence off of our work.
“Guns, abortion, rich and poor, young and old, race… sometimes they even slip up and tell us what they really think of us. Deplorables and irredeemables.
“My hope and prayer this holiday weekend is that the 98% of my fellow citizens will finally come together and cast their steely stare at D.C., rather than at each other, in recognition of where the problems of the past 100 years have come from, BOTH parties.
“When the 98% unite and turn their stare at D.C., I can see Pelosi and Schumer and Mitch choking on their wine and cheese (or freezers full of expensive designer chocolate ice cream) in recognition the jig is up and they’ve been figured out.
“That is my dream this holiday weekend and I just wanted to recognize everyone at The 5 for the important part you play in awakening us all to what really is going on.
“Thank you for all you do!”
The 5: Thanks for perking up our spirits — we needed it!
The 5 Min. Forecast
P.S. OK, we’re seeing a little bit of pushback against the renewed business closings.
“Arbitrary and irrational,” says Tom Hatten of the Mountainside Fitness chain — who’s filed suit against Arizona’s Republican governor and kept his locations open. Hatten promises to pay any fines his managers are issued — and at least one in Scottsdale is already facing charges.
Right now, cases like these still appear to be the exception. Could they become the rule? Stay tuned…