200414 May you live in interesting times

Market Bulls are correct! They are! There has been in the past no time when the overall stock market has bounced 50% from a low and later reversed lower. It hasn’t happened in the past. So, the TV pundits are now pushing stocks, loudly. That is their job. I think they are nothing but shills for virtually worthless Fiat investments. They may be right, in the short term. I suspect they are wrong in both the short, intermediate and long term.

COVID-19 is a game changer. Stay at Home orders (SAHO) implemented on a virtual Planet wide basis has destroyed industries. Its changed lives. There may be a tremendous relief rally in a few weeks as SAHO’s get lifted and people become irrationally exuberant about returning to their pre- COVID lives.

I applaud anyone that can make money in an uptrend- as long as they put at least part of their profits into physical gold and silver. There is no cure for COVID-19 at this time. No cure or vaccine coming soon- regardless of what politicians or “cheerleaders” say. China is once again locking down entire regions due to new outbreaks. As I’ve said before- I will say again- this isn’t over!

The battle for COVID-19 isn’t over. This isn’t the beginning of the end. It just the end of the beginning. The pundits are saying that only 2nd quarter earnings are going to be awful…. they promote the idea that sometime in the summer normalcy will return. They have no basis for the prediction since a situation like this has never happened when so many Average Joe’s have had exposure to the stock & debt markets.

What does “normal” look like? Right now, in the States, millions of husbands and wives are looking at all their expenses with suspicion. Three weeks locked up at home, with limited income and they are wondering about why they wasted so much money in the past. Starbucks? Really?

The longer the lock-down lasts- the more they realize how much wasteful spending was in their budgets. The US Consumer has long been hailed as the 70% driver of the economy. Now, that consumer, isn’t. That consumer is learning that he/ she has under- saved for emergencies and over- consumed on dumb stuff. The longer this lasts, the more self realization will occur. Why pay $6 for a coffee one can make at home for 25 cents?

The game has changed. But most (the dumbest people really) won’t accept that at first. First will be a post lock- down splurge. That will happen globally. Happened after the first year of the Bubonic Plague in Europe. Then, COVID returns and panic returns. People are going to get busy congregating and it will propagate the problem.

What to do:

  1. Self isolate yourselves and your family long after this seems “over”. It only make sense. Polite excuses might save the life of your or your loved one.
  2. If you have savings, buy some Silver and Bitcoin. Don’t drain your accounts- but it is prudent based on wildly out of control money printing by governments- the USG in particular. The debt markets are at a virtual crisis point.
  3. Take advantage of the “Splurge” time to restock your shelves. Clearly basic goods are far more valuable than cash. For the kids down the block that were selling rolls of TP at $5 each- kuddos!
  4. If you have a sewing machine, make masks! Not that you need them… but you can sell them on a street corner to those to dumb or lazy to make their own. $1 in material can net you a 600 to 1000% profit. Too amazing an opportunity to ignore! The modern Lemonade Stand!
  5. Look at all the positions you held in your 401, 403, IRAs and other investment accounts with a clear eye. Is this rally a chance to cut losses?
  6. For all the positions you keep- set Stop Losses on them. Take the emotion out of the equation.

I could very well be wrong. Maybe its all sunshine and roses from here on out. If so, I will never be happier to be wrong! But keep your bright, optimistic eyes focused. My projection of S&P 1750 may be right. Hope not! Keep your options on the table. Embrace your inner Entrepreneur. This disease is a tragedy for so many 10s of thousands of families. Don’t add your name to that list. Move forward proactively!