Something remarkable happened yesterday [Thursday]. Stocks didn’t go up. They went down…and they went down a lot.
The S&P 500 dumped 5.89 percent. But that was nothing. Gannett Co. crashed 29.5 percent, Noble Corporation plunged 25.51 percent, and Denbury Resources dropped 23.65 percent.
Should you buy the dip?
To properly answer this question we must back up, so as to widen our perspective. From this outer perch several critical factors in the retail sector come into focus.
To begin, the music has stopped for American retail companies. Yet retail investors have kept right on dancing. Pandemic, economic collapse, full societal breakdown. Nothing’s holding them back.
According to Bloomberg, the month of May was the worst month for insolvencies since the Great Recession. On the month, 27 companies with at least $50 million in liabilities sought bankruptcy protection from creditors. Notable filings came from J.C. Penney, Neiman Marcus, and J. Crew. Continue reading
“And the will of Zeus was moving towards its end.” – Homer
The recline and flail of western civilization beats on. Pandemic, economic collapse, full societal breakdown. The sequence grooves from one to the next with the symbiotic disharmony of a minor pentatonic scale.
Peaceful protests devolved to rioting, looting, and structure fires in our own lowly hamlet last Sunday. The Long Beach police couldn’t stop the vandals. So the National Guard was summoned to quell the ransacking. Some Guardsmen even stuck around to help out with the cleanup effort the following day.
The refrain – pandemic, economic collapse, full societal breakdown – has been repeated in many cities across the country. For each: The time is now. The place is here.
The progression from government pandemic lockdown orders to government curfew orders has been as natural as day to night and back again. The difference between the two is subtle; like the difference between ketchup and catsup. Continue reading
This week’s standard refrain was one of pessimism. The quick return to economic health mantra that was popular not long ago has disappeared faster than you can say lickety-split. But there was one notable outlier this week. In fact, one leading economist stepped forward with assurances that renewed prosperity lays just ahead.
On Wednesday, Nobel prize economist Paul Krugman looked up from his liquidity trap graphs long enough to tell Noah Smith at Bloomberg that the 1979-82 economic slump “would suggest fast recovery once the virus is contained. I don’t see the case for a multiyear depression.”
This sounds great and all. A fast recovery would end a lot of financial pain and suffering. Still, we seem to think the damage that’s been done by the government lockdown will have long-term consequences.
The glorious ascent of the concave parabola of government spending and debt won’t go away. The budget deficit has grown by leaps and bounds – nearly $3 trillion – over the last four months. The national debt – currently over $25.6 trillion – has overtaken the economy. Continue reading
Scientists are always whittling away at the unknown with new tools and technologies. The honest ones recognize the limits of their work. Yet they push onward; always chasing the elusive breakthrough.
The charlatans, however, don’t care about adding to human knowledge. Frustrated by their lack of progress, they’ve long since given up on practicing real science. What they care about is their university tenure…and how they can apply complex tools to bolster the profitability of their bamboozle.
The science of epidemiology has self-destructed. Mathematical biologists of the doom orthodox have sullied the profession. The Imperial College computer model led by Professor Neil Ferguson – a charlatan – to justify lockdown orders in England and the United States has been revealed to be utter trash.
If the consequences were a mere academic breakdown the failings could be corrected in the good name of science. The models could be refined. The inputs could be improved. No harm no foul. But the consequences are not an academic breakdown. Rather, they’re much, much more. Continue reading