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Did The WHO Just (Accidentally) Confirm COVID Is No More Dangerous Than Flu?

Did The WHO Just (Accidentally) Confirm COVID Is No More Dangerous Than Flu?

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Did The WHO Just (Accidentally) Confirm COVID Is No More Dangerous Than Flu? Tyler Durden Thu, 10/08/2020 - 18:10

Authored by Kit Knightly via Off-Guardian.org,

The World Health Organization has finally confirmed what we (and many experts and studies) have been saying for months – the coronavirus is no more deadly or dangerous than seasonal flu.

The WHO’s top brass made this announcement during a special session of the WHO’s 34-member executive board on Monday October 5th, it’s just nobody seemed to really understand it.

In fact, they didn’t seem to completely understand it themselves.

At the session, Dr Michael Ryan, the WHO’s Head of Emergencies revealed that they believe roughly 10% of the world has been infected with Sars-Cov-2.

This is their “best estimate”, and a huge increase over the number of officially recognised cases (around 35 million).

Dr. Margaret Harris, a WHO spokeswoman, later confirmed the figure, stating it was based on the average results of all the broad seroprevalence studies done around the world.

As much as the WHO were attempting to spin this as a bad thing – Dr Ryan even said it means “the vast majority of the world remains at risk.” – it’s actually good news. And confirms, once more, that the virus is nothing like as deadly as everyone predicted.

The global population is roughly 7.8 billion people, if 10% have been infected that is 780 million cases. The global death toll currently attributed to Sars-Cov-2 infections is 1,061,539.

That’s an infection fatality rate of roughly or 0.14%.

Right in line with seasonal flu and the predictions of many experts from all around the world.

0.14% is over 24 times LOWER than the WHO’s “provisional figure” of 3.4% back in March. This figure was used in the models which were used to justify lockdowns and other draconian policies.

In fact, given the over-reporting of alleged Covid deaths, the IFR is likely even lower than 0.14%, and could show Covid to be much less dangerous than flu.

None of the mainstream press picked up on this. Though many outlets reported Dr Ryan’s words, they all attempted to make it a scary headline and spread more panic.

Apparently neither they, nor the WHO, were capable of doing the simple math that shows us this is good news. And that the Covid sceptics have been right all along.

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America’s Minsky Moment Approaches

America’s Minsky Moment Approaches

Authored by Michael Wilkerson via The Epoch Times,

Named after American economist Hyman Minsky, the idea…

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America's Minsky Moment Approaches

Authored by Michael Wilkerson via The Epoch Times,

Named after American economist Hyman Minsky, the idea behind a Minsky moment is that a financial markets crisis (especially in credit markets) is caused by a sudden and systemic collapse in asset prices, usually after a sustained period of speculative investment, excessive borrowing, and widespread financial risk taking.

In other words, it’s the moment when the music stops playing, investors stop buying, and the Ponzi game ends abruptly. It’s a hard crash.

America may be on the brink of its Minsky moment.

This process, which moves from slowly, slowly, to suddenly and now, goes back decades.

The confrontation with reality that was required to put America’s economic house back in order after the global financial crisis of 2008–09 was deferred to a later date by politicians, central bankers, and government officials alike, presumably when they would no longer be around.

Instead of taking the painful but necessary steps of liquidation—i.e., allowing more over-levered and risk-heavy banks and financial firms to fail, and for the economy to take the short-term pain, then move on—the U.S. government and the Federal Reserve kicked the can down the road by massive money-supply expansion and unproductive government spending.

The same playbook from the financial crisis (i.e., money printing and fiscal excess) was used again in 2020 in response to the pandemic. As the monetary authorities had but one instrument in their toolbox—the blunt-force cudgel of money-supply growth—it was the go-to solution.

As the saying goes, when the only tool available is a hammer, every problem looks like a nail. In both instances—the financial crisis and COVID periods), the U.S. Congress went on a massive spending spree, not realizing (or, as political animals with short time horizons, not caring) that excess and repeated deficit spending, and the debt creation needed to fund it, would eventually spiral out of control and doom future generations.

While a more serious collapse of the bubble—a monetary Great Reset—was avoided in 2008–09, the underlying conditions were not resolved.

The monetary and fiscal actions taken at the time only postponed the crisis and, worse, further inflated a massive bubble that is destined to eventually burst.

We are still living in this bubble, evidenced by all-time highs in equity and crypto markets, speculation in numerous asset classes from real estate to collectibles to memecoins, and “get what you can while you can” borrowing by governments, households, and corporates alike.

Given the increasing magnitude (in both nominal and real terms) of the debt problem, a financial crisis in 2024 or 2025 will have much worse consequences than anything that would have happened at the time of the financial crisis 15 years ago.

On the eve of the 2008 crisis, U.S. federal debt to GDP was around 64 percent, the same level as in 1995. This allowed some flexibility. As of the most recent quarter, the ratio of debt to GDP is now nearly double that, at 122 percent.

On this measure, the United States is now among the top 10 most indebted countries in the world, a peer group that includes economically hobbled nations such as Venezuela, Greece, Italy, and sclerotic Japan.

The level of U.S. national debt, quickly approaching $35 trillion in coming months, now requires more than $1.1 trillion in interest payments annually just to service it. And this number doesn’t include state and municipal debt or the unfunded liabilities and entitlements such as Medicare and Social Security that now comprise the substantial majority of the federal budget, limiting anyone’s ability to shrink the deficit through a reduction in discretionary spending.

The deficit for 2024 is tracking at $1.7 trillion, adding to the existing cumulative U.S. deficit of $22 trillion since 2001. The deficit matters in part because high deficits relative to GDP are strongly correlated with persistent inflation.

Since 2020, the United States has run the highest levels of deficits (as a percent of GDP) since World War II. Those deficits produced high inflation, but they also reversed and became budget surpluses shortly after the war ended. This was made possible because of the productivity miracle that was mid-twentieth century America.

The United States of 2024 has no equivalent productivity boost waiting in the wings. Artificial intelligence is one bright spot, but other tech (crypto in particular), energy, and mining industries are each being chased off-shore through regulatory interference.

Manufacturing is attempting a comeback, but only represents 11 percent of GDP. Bureaucratic, tax, monetary (the U.S. dollar remains too high to be competitive), and other barriers persist. The continued growth (as a percent of GDP) of financial advisors, personal injury attorneys, and tax accountants needed to navigate the impossible IRS tax code hardly comprise the revolutionary army needed to make the American economy great again.

When the Minsky moment arrives, the U.S. government will have no ability to confront it save for a resumption of quantitative easing and other forms of money printing.

With the bond markets in turmoil, investors will be increasingly reluctant to buy more U.S. debt. Foreign buyers have already begun reducing their exposure, and now account for only 30 percent by value of U.S. Treasurys held, compared with 45 percent in 2013.

If this divestment trend suddenly accelerates, the United States will be forced to monetize its debt through Federal Reserve purchases of U.S. Treasurys. This will be highly inflationary, even as economic conditions are weakening and unemployment is rising.

The U.S. Department of the Treasury and the Federal Reserve have already committed to a “whatever it takes” approach to crisis management. When the Minsky moment arrives, and the bond markets are in meltdown, the “whatever it takes” will primarily be a firehose of liquidity (more money created out of thin air) to the banking system with an alphabet soup of program names.

As a result, the United States will be forced to accept significantly higher levels of inflation. The alternatives are just too severe. The U.S. government, as the issuer of the world’s reserve currency, cannot default. There is a practical limit on how high it can take the visible tax rate. Its only alternative is the hidden tax of ever-higher inflation.

To avoid this outcome, U.S. productivity would have to dramatically increase such that the ratio of debt to GDP falls back in line. This seems an impossibility. The higher the ratio of debt to GDP, the greater the anchor-like drag on the national economic ship.

Tyler Durden Fri, 03/29/2024 - 09:00

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Stocks, Gold, & Crypto Soar In Q1 Despite Rout In Rate-Cut Expectations

Stocks, Gold, & Crypto Soar In Q1 Despite Rout In Rate-Cut Expectations

Q1 macro was characterized by a vast divergence between ‘soft’…

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Stocks, Gold, & Crypto Soar In Q1 Despite Rout In Rate-Cut Expectations

Q1 macro was characterized by a vast divergence between 'soft' surveys crashing as 'hard' data drifting higher...

Source: Bloomberg

The strong 'hard' data - and sticky inflation - along with endless jawboning, drove rate-hike expectations drastically lower in Q1. 2024 expectations for The Fed crashed from almost seven cuts to less than three...

Source: Bloomberg

...and stocks did not even blink!

Source: Bloomberg

With the S&P 500 surging to its best start to a year since 2019 (outperforming Nasdaq)...

Source: Bloomberg

That's the 5th green month in a row...

Source: Bloomberg

And stocks are up for 18 of the last 22 weeks (it hasn't done more than that since 1989)...

Source: Bloomberg

Notably, and perhaps surprisingly, Q1's best performing sector was not tech... it was Energy (with Real Estate the only sector red in Q1). In fact in March, Energy stocks are up 10% while Tech is unchanged...

Source: Bloomberg

Some have argued that Q1's market strength reflects a growing belief that Republicans will win in November...

Source: Bloomberg

And don't let anyone tell you this has not been a multiple expansion - tech is now back at over 28x - its post-dot-com bust highs...

Source: Bloomberg

MTUM (momentum) saw its best start to a year... ever....

Source: Bloomberg

In fact, as Goldman shows in the chart below, High Beta Momo - the big Q1 outperformer - reversed its laggard performance in 2023...

Thematically, Bitcoin-Sensitive stocks, AI stocks, and anti-obesity drug stocks all outperformed in Q1, continuing the trend of 2023 gains...

AI-related stocks soared 24% in Q1 while stocks at risk from AI fell around 3% in Q1...

Source: Bloomberg

Anti-Obesity stocks soared in Q1, actually outperforming AI stocks and even GLP-1-at-risk stocks (e.g. WW) managed gains in Q1...

Source: Bloomberg

'Magnificent 7' stocks added a stunning $1.7 trillion in market cap in Q1...

Source: Bloomberg

Notably, the implied vol of the Mag7 is once again very elevated relative to the implied vol of the S&P 500. In July of last year, this signaled a big reversal (demand for hedges). In Jan of this year, it was a signal of chasers buying levered bets on the upside. What does it mean this time?

Source: Bloomberg

The strength in stocks and credit has dominated any rise in yields and crushed financial conditions to their loosest since before The Fed started their rate-hiking cycle...

Source: Bloomberg

US Treasuries were dumped in Q1 as rate-cut expectations plunged with the short-end modestly underperforming...

Source: Bloomberg

And while survey-based inflation expectations (UMich) are sliding, the market's expectation for inflation is anything but...

Source: Bloomberg

The dollar rallied in Q1, erasing around half of the Q4 losses...

Source: Bloomberg

The dollar's strength was supported by yen weakness as the Japanese currency plunged to its weakest since 1990...

Source: Bloomberg

Not to be outdone, the yuan also tumbled in Q1...

Source: Bloomberg

Q1 was dominated by bitcoin headlines - as the newly minted ETFs saw unprecedented inflows...

Source: Bloomberg

Which helped push Bitcoin to a new record high (in USD)...

Source: Bloomberg

Ethereum also soared in Q1 (up 55%) but Solana outperformed...

Source: Bloomberg

Another alternate currency - gold - also soared to a new record high in Q1...

Source: Bloomberg

And just when you thought NVDA was the big winner, Cocoa hyperinflates in Q1, up 135% YTD!

Source: Bloomberg

Oil, wholesale gasoline, and pump-prices all ripped higher in Q1 (especially March)...

Source: Bloomberg

Finally, as Goldman's Chris Hussey notes, it's times like these – when 'everything is awesome' – when it is best to assess the risks that swirl around the investment landscape. Here are a few to consider:

  • A strong economic landing becomes a hard landing;

  • Inflation is sticky, not transitory, and the Fed pushes back;

  • The pandemic stimulus surge turns out not to be 'cost-less';

  • Concentration raises 'key company' risk;

  • Elections and geo-political risks.

And as a reminder, we've seen these 'everything is awesome' moments before...

Source: Bloomberg

And they never end well.

Tyler Durden Thu, 03/28/2024 - 16:00

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The divided state of Australia’s property market

In this week’s video insight, I explore the divided state of Australia’s property market, highlighted by the latest Australian Bureau of Statistics…

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In this week’s video insight, I explore the divided state of Australia’s property market, highlighted by the latest Australian Bureau of Statistics (ABS) figures. With new home lending showing an unexpected decline, the market seems to be at a crossroads between tightening credit conditions and rising investor interest.

Transcript:

Depending on how you read the stats, the property market is going very well indeed… or not very well at all.

As you can see on this first chart, Australian Bureau of Statistics (ABS) figures released in the last week or so reveal new home lending fell 3.9 per cent in January from December, contrasting with analyst expectations for an increase and suggesting the screws are sufficiently tight to put a lid on house price gains this year.

Those ABS stats revealed that the value of new home loan commitments fell to $25.1 billion from $26.1 billion in December. This was the second consecutive monthly contraction among first-time home buyers, older owner-occupiers, and even investors.

New home lending obviously leads to purchases and turnover. A drop in lending today means a drop in buyers buying later.

But not everyone is feeling down. Certainly not real estate agents – are they ever? They’re promoting a different picture revealed by the ABS data release. Looking at December rather than January ABS data, they note lending to property investors reached a six-year high as a share of total home lending.

According to the ABS, 36 per cent of all housing finance in December went to investors. This is the highest level since 2017 and way up from the circa 23 per cent share held in the COVID-19 slump of 2020.

While some real estate agents believe we are off to the races again, including one Sydney Lower North Shore agent who told clients, “… it’s game on, folks!” the reality is that while investor share is back up to 36 per cent, it was more than 40 per cent in early 2017 and over 45 per cent in 2015.

The fact remains that while the share of investor loans has increased, the pie itself is shrinking.

The ABS’s most recent data reveals that both total loan ‘volumes’ and ‘values’ declined.

New loan commitments to property investors fell 2.6 per cent from December to $9.2 billion, and over the 12 months to January, the $105.2 billion in new loan commitments to investor buyers was down 8.1 per cent from the same period a year earlier.

Typically, this should result in the brakes being put on house price increases. Remember, the single biggest driver of property prices is simply ‘access to credit’. If fewer people are accessing credit, pricing tends not to soar.

As can be seen in this chart from PropTrack (which, by the way, is not tracking house prices, but the rate of change of house prices over time), house prices are still rising on an annual basis, but with the exception of Canberra and Adelaide, the pace of increase has steadied or is declining slightly. This also happens to be consistent with recent transaction volume and auction clearance data.

It is simply the case that the slower rates of home price increases reflect the restrained mortgage activity trends.

It is, however, also the case that investors are now driving a larger share of lending activity. And that might have something to do with all those tight rental market stories we’ve been hearing about.

Sharp rental increases reported by tenants through the media will influence buyers to invest and attract them into the market.

Meanwhile, according to CoreLogic, residential vendors averaged $310,000 in gross profits during the December quarter, which was 6.9 per cent higher than the previous three months.

It seems to me we have entered a bit of a holding pattern. Property owners and Investors will look forward to interest rate cuts, which, unfortunately, could push house prices even further out of reach for many.

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