My mother (69) is a heavy smoker with health complications living in London. (She has Parkinson’s disease.)
“If you catch coronavirus,” I told her, “you are a goner. Please stay at home and limit your contact with the outside world as much as possible.”
We’ll see if she listens.
We’re on the Same Path as Italy
My fear is what is happening in Italy and Iran right now (26,500 cases, overwhelmed healthcare industry, overwhelmed prison industry) will be happening in the USA, the U.K., and other countries in less than two weeks.
I’ve been watching the data on this disease for the last six weeks.
I see how the disease has progressed in China, Taiwan, South Korea, Hong Kong, and Singapore (retarded growth)… versus Iran, Italy, and now Spain, France, the U.K., Switzerland, Holland, and Germany (explosive growth).
The difference is, the Asian countries went to early extremes to test, trace, and isolate, whereas some European countries are still staging soccer matches and horse racing festivals.
The United States is on the same path as Italy, other European countries, and Iran.
The U.S. is NOT on the same path as South Korea, Taiwan, China, Singapore, and Hong Kong.
In two weeks, every major city in the U.S. could be under lockdown, with the streets deserted…
Investors Are 10 Steps Behind
Recently, I cited the example of Toys “R” Us bonds. They fell from $97 to $21 in eight trading days, even though it had been obvious for years the company was heading for bankruptcy.
The point I was making was that sometimes investors ignore bad news, even when it’s patently obvious.
Here’s another example: Bear Stearns was insolvent in March 2008. But the stock market kept rising until August 2008.
I think America’s attitude to coronavirus in March 2020 – after China’s economy had completely shut down and Italy’s healthcare system imploded – will go down as one of the greatest examples of “cognitive dissonance” in history.
I hope I’m wrong about this. But if I’m right, there’s a lot more economic pain to come.
Stock market investors are still 10 steps behind this story. Prepare for further stock market losses (especially in terms of gold).
Bigger Consequences Ahead
The United States has a bloated stock market.
It also has bloated healthcare and prison industries.
In addition to the collapse in the Dow-to-Gold ratio we’ve predicted many times, could the United States be facing imminent crises in its healthcare and prison systems, too?
Editor, Postcards From the Fringe
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