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04/04/2020

For the week 3/30-4/3

[Posted 11:30 PM ET, Friday]

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Edition 1,094

The death toll soared further globally this week.  Last time there had been 27,000 worldwide and tonight as I go to post the figure is over 59,100.

In one week, Italy has gone from a death toll of 9,134 to 14,681 (including 73 doctors and 24 nurses).  Spain from 4,934 to 10,935.  France 1,995 to 6,507.  The UK from 759 to 3,605.

Netherlands 546 to 1,487.  Belgium 289 to 1,143.

And the U.S., which sat at about 1,500 last Friday night is now over 7,300.

New York State is now at 3,218, exceeding the death toll from 9/11.

But there are a few even more distressing facts.  Until Thursday, Italy, Spain, France and the UK were only counting those that had died in the hospital…not those dying in nursing homes.  France began to catch up on this Thursday and the result was sickening.  Hundreds and hundreds added to the total, and they are just getting started.

So the total in Europe is no doubt much higher than being reported.  It will take time for this to reveal itself as you need to be accurate on whether the victims actually had coronavirus.  History demands it.

Of course history will look back and wonder what the truth is when it comes to China and Iran.  In Iran there is zero doubt the toll is thousands higher than being reported, 3,294 as of tonight.  Many believe that China’s true figure may be tens of thousands more than the 3,322 they are reporting.

Perhaps even more disturbing, however, is that cases in Japan, South Korea, and Singapore have been spiking back up.  Friday, Singapore, with all the precautions it has taken, reported its highest daily case total yet and the country has been locked down, except for essential industries.

And remember those new hordes of migrants attempting to get into Europe? 23 have tested positive in one Greek migrant camp.

This week Minnesota Democratic Sen. Amy Klobuchar, talking about her recovering husband, said what is so sad about Covid-19 is that it is the “lonely disease.”  “You can’t hold their hand to help them through their suffering,” adding, “people are not expendable.”

I happened on a note from Fionnan Sheahan, editor at the Irish Independent, to her readers:

“After all this ends, we’ll probably refer to life BC (Before Coronavirus) and AD (After the Disease) as every aspect of our health, lifestyle, society and values has been turned upside down in such a short period.”

Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, conceded that the pandemic could cause between 100,000 and 200,000 deaths in the United States.  The shortage of ventilators is the key immediate issue.  New York City is days away from a point where it won’t be able to meet demand.  It will be the same situation in New Orleans shortly.

For weeks, President Trump has been too casual in his approach to the outbreak, frequently downplaying it and telling reporters it would simply go away.

But Tuesday he said, “This is going to be a painful two weeks.  Our strength will be tested, our endurance will be tried.”

Yet there was the president on Thursday, disagreeing with his coordinator of the White House task force, Dr. Deborah Birx, on social distancing.

Birx said Americans were not doing a good enough job staying a safe distance apart, days into the new 30-day extension of the guidelines.

“When we said that, now over 16 days ago, that was serious,” Birx said, noting that the people who were now becoming sick would have gotten the virus after the guidelines first went out.  But the president, standing near Birx, interceded.  “Deborah, aren’t you referring to just a few states, because many of those states are dead flat,” Trump said, referring to states where the virus had not taken off dramatically and pushed up the national “curve” of deaths.  Birx responded that it was true that some states were flat but that an outbreak in a new city would spoil that.

So two days after adopting a somber tone, the president on Thursday was upset that Birx was focusing on areas where those measures had not been followed sufficiently rather than on states in which the virus had not taken off.  “It’s hard to blame flat-liners for not doing a good job,” Trump said, sparking Birx to express with emotion, “No, no, I don’t want to say that!”

Trump made clear he did not want headlines suggesting that not enough was being done, and he went on to explain repeatedly what he believed Birx meant.  “She wasn’t talking about the average of anything, she was talking about an individual state,” Trump said.  “Our states, generally speaking – it’s like lots of different countries all over – we have, many of those ‘countries’ are doing a phenomenal job.  They’re really flat, and I think that’s what you meant.”  Birx responded, “Thank you, sir.”  But then, exasperated, said, “We know what can be done.  And others are doing it and most of the people in the United States are doing it.  It’s our communities, it’s every American that has to make these changes,” she said.

Trump responded, “We’ve done, I think on average, really phenomenally as a country.”

Today, Trump waffled on the issue of wearing a mask. The CDC is recommending you wear one when you’re at the grocery store or pharmacy, so I’ve got my bandana ready because my town has a ton of cases and now reports of deaths in the neighboring community, but the president said he wasn’t going to wear one.

Also today, the president was questioned when he really knew about the risk of a pandemic, the reporter bringing up the point that a video has emerged of Health and Human Services Secretary Alex Azar from January 2019 wherein Azar talks of a potential pandemic.  Trump said, “What’s happened is very severe…I’ve known about pandemics.”

Azar said the administration had “great preparedness for pandemics… We’ve all been focused on pandemic preparedness.”

But the president reiterated one of his latest talking points, “The previous administration gave us very little shelf space…the shelves were empty…the military shelves also empty.”

It’s amazing how the president seems to forget we all know he has been in office well over three years.  It’s his problem.

There was Azar saying the administration has been focused on pandemic preparedness, so why then were the shelves barren?

Otherwise, all week it was nothing but constant claims of “We’re doing a great job!  We’ve done a job like no one’s ever done a job.”

---

Bill Gates, who predicted this pandemic in a “Ted Talk” in 2015, laid out a 3-step process in a Washington Post column Tuesday.

“There’s no question the United States missed the opportunity to get ahead of the novel coronavirus,” he wrote.  “But the window for making important decisions hasn’t closed.”

Some would argue by week’s end it has.

Gates’ advocates a total national shutdown for six to 10 weeks; nationwide testing “so we can quickly identify potential volunteers for clinical trials and know with confidence when it’s time to return to normal;” and we need a vaccine.

Referring to his Ted Talk, Gates said: “In 2015, I urged world leaders to prepare for a pandemic the same way they prepare for war – by running simulations to find the cracks in the system.  As we’ve seen this year, we have a long way to go.  But I still believe that if we make the right decisions now, informed by science, data and the experience of medical professionals, we can save lives and get the country back to work.”

Treasury Secretary Steven Mnuchin assured the nation that the relief checks of $1,200 ($3,400 for a family of four) will be going out in two weeks.  A memo from the House Ways and Means Committee said those without direct deposit information may not get checks until mid-August or later.  According to the document, starting the week of May 4, the IRS will begin issuing paper checks to individuals, but they will be issued at a rate of about 5 million a week, which means it could take up to 20 weeks to get all the checks out.

Robert J. Samuelson / Washington Post

“The danger of prematurely relaxing the lockdowns and quarantines is that the virus soars.  Little will have been gained.  Success requires public understanding of the difficult choices that are involved.  Trump should serve as the explainer in chief. But preoccupied by his own political future, he is hardly a model of courageous clarity.  On Sunday, Trump extended the guidelines for social distancing until the end of April. This implies that the president sided with his scientific advisers, at least temporarily.

“The larger issue is that politics in democracies are inevitably skewed toward short-term outcomes, not long-term gains.  This is a condition that, regardless of how the coronavirus drama turns out, should engage us all.”

Michael Morell and Kristin Wood / Washington Post

“Why does this keep happening to us?

“Once again, we didn’t do enough to respond to a threat that the experts saw coming in advance.  And, now we are paying the price.

“Experts have long seen a coronavirus-like pandemic as a threat.  In January 2019, Daniel Coats, then the director of national intelligence, warned that ‘the United States and the world will remain vulnerable to the next flu pandemic or large-scale outbreak of a contagious disease that could lead to massive rates of death and disability, severely affect the world economy, [and] strain international resources.’

“In September 2018, Anthony S. Fauci, our nation’s leading expert on infectious pathogens, told CBS News that ‘the thing most threatening to us…would be something that spread widely, generally a respiratory infection, something that has a high degree of morbidity and mortality.’

“And, just last year, the Trump administration ran a pandemic exercise simulating a severe influenza pandemic for which there was no vaccine.

“The draft conclusions said the United States was underprepared for a pandemic and was disorganized to deal with one.  It said the country didn’t have the capacity to manufacture personal protective equipment, needles and syringes, pointing out that these supplies, along with antiviral medications, respirators and ventilators, would be ‘limited and difficult to restock.’

“And, yet, we did not act on these warnings.

“We did not have a strategy on mitigation to reduce the threat of a pathogen. And we did not have a companion strategy on preparation – a plan and pre-outbreak set of actions to get ready for a pandemic to minimize the human and economic costs if mitigation failed.

“The Trump administration’s initial choices made this worse, but this failing does not just rest with them….

“(The) blame must be shared with every administration over the past 20 years.

“What has not happened this year is a stark reminder of what didn’t happen in the lead-up to the terrorist attacks of Sept. 11, 2001. Despite repeated strategic warnings over a number of years by the CIA that Osama bin Laden was coming after us, little action was taken to degrade al-Qaeda.  Yes, 9/11 was a tactical intelligence failure – in that the intelligence community did not know in advance the time, place or method – but it was also a policy failure, again by multiple administrations.

“Our failure this time will be much more costly than 9/11….

“Whatever its roots, we must overcome the tendency to under-prepare for threats that we can clearly see – as there are many more of them out there.  The most obvious and most important for sure is climate change, about which we and the world continue to avoid the necessary mitigation strategies.

“But, the list also includes the growing risk of nuclear war driven by the fraying of long-standing U.S.-Russian nuclear agreements, as well as the ongoing lack of economic opportunity that is putting American democracy and capitalism at risk.

“We need to do everything we can to support those on the front lines who are saving us from the coronavirus.  But we also need to consider it a wake-up call for us to change, to act more decisively on the warnings we receive.”

Emily Baumgaertner, James Rainey / Los Angeles Times

“Two months before the novel coronavirus is thought to have begun its deadly advance in Wuhan, China, the Trump administration ended a $200 million pandemic early-warning program aimed at training scientists in China and other countries to detect and respond to such a threat.

“The project, launched by the U.S. Agency for International Development in 2009, identified 1,200 different viruses that had the potential to erupt into pandemics, including more than 160 novel coronaviruses.  The initiative, called PREDICT, also trained and supported staff in 60 foreign laboratories – including the Wuhan lab that identified SARS-CoV-2, the new coronavirus that causes COVID-19.

“Field work ceased when the funding ran out in September, and organizations that worked on the PREDICT program laid off dozens of scientists and analysts, said Peter Daszak, president of EcoHealth Alliance, a key player in the program.

“On Wednesday, USAID granted an emergency extension to the program, issuing $2.26 million over the next six months to send experts who will help foreign labs squelch the pandemic. But program leaders say the funding will do little to further the initiative’s original mission.

“ ‘Look at the name: Our efforts were to predict this before it happens.  That’s the part of the program that was exciting – and that’s the part I’m worried about,’ Daszak said.”

From USA TODAY:

“The White House and congressional intelligence committees were briefed on the scope and threat of the coronavirus in January and February, but President Donald Trump has not stopped exports of key medical equipment – a move taken by at least 54 other countries so far.

“The data show how U.S. manufacturers stepped up production and cleared out inventory to supply protective medical equipment to China for weeks, even as the threat of the coronavirus became clear.  The CDC reported its first case in the United States on Jan. 20. Within the next two weeks, the World Health Organization and the U.S. Department of Health and Human Services had declared the disease a public health emergency.”

Finally, I didn’t have time to get into this last time but going back to February, President Trump hammered away at Sleepy Joe Biden and President Barack Obama for their mishandling of the H1N1 Swine Flu pandemic.  So I went back through my archives of the main period of that outbreak in the U.S., from April 2009 to April 2010, and picked a few items at random.

H1N1 was in no way comparable to Covid-19.  For starters, it was far less contagious.  Yes, some moves were made, such as I wrote on May 15, 2009, that “New York City Mayor Michael Bloomberg opted to close three schools because of renewed outbreaks of swine flu, so it’s still percolating… (the) real focus the next few months is on how the flu spreads in the Southern Hemisphere and the strength when it comes back in the fall.  WHO experts are now comparing the strain to 1957, not 1918.  But the ’57 Asian version could still kill 14 million and knock 2 percent off the global economy.”

June 6, 2009: “Meanwhile, the World Health Organization is closer to declaring H1N1 a pandemic but wants to be careful to note that the virus is not very lethal, being blamed for only 120 deaths, worldwide, thus far.

November 28, 2009: “While it appears swine flu has peaked in the Northern Hemisphere (though it is still spreading in the Middle East and Eastern Europe), there are signs around the world the H1N1 virus has mutated to a drug-resistant strain, which bears watching come next year and a potential second round.  There was a cluster at Duke University hospital for example that was drug resistant, as well as clusters in Britain, Norway and China that are being followed closely.

December 19, 2009: “From Global Security Newswire:

“The spread of the H1N1 flu virus through the United States this year revealed that the nation’s medical care system remains ill-prepared to handle the intensive demands that could develop from acts of bioterrorism or other major health crises.”

Feb. 27, 2010: “I believe, as Sen. Coburn hammered home, that a huge part of our healthcare problem is that we take too many tests.  I believe there should be far more of a very public emphasis on prevention, much of which can be accomplished at little cost with some very effective public service announcements, for crying out loud.  Look how effective all our pronouncements on washing one’s hands proved to be in combating H1N1.  The president led that effort.  We need more of that.”

Boy, we have short memories.

And by the way, from April 2009 to April 2010, I went to Iceland, Calgary (for The Stampede), North Carolina, Ireland, Oregon, Kiawah (to run a half-marathon), Albania and Lebanon.

Yes, H1N1 may have been labeled a pandemic but it was not Covid-19.  One source I looked at said there were 42…42…confirmed deaths in New Jersey.  As of tonight, my state has suffered 646 deaths, almost all in the last two weeks.

And to the idiots who were saying a few weeks ago that the death toll from the coronavirus would be no worse than the number of deaths on our roads, the number of traffic-related fatalities in New Jersey in 2018 was an estimated 563, including 179 who were pedestrians.

Trump World

--Trump went after 3M Co. in a total hatchet job that was unfair and grossly ignorant, saying in a tweet late on Thursday that he was invoking the Defense Production Act to get the company to produce face masks.

“We hit 3M hard today after seeing what they were doing with their Masks.  ‘P Act’ all the way. Big surprise to many in government as to what they were doing – will have a big price to pay!”

3M CEO Mike Roman told CNBC today, “The narrative that we aren’t doing everything we can as a company is just not true.”  The company secured China’s approval to export to the U.S. 10 million N-95 respirators manufactured by the company in China.  It is doing all it can to ramp up production at its U.S. facilities, but, yes, it has supplied masks to some countries in dire need of them as well for “humanitarian” reasons, most of the time from plants 3M has in those very countries.

In a statement, the company said that ending exports of respirators “would likely cause other countries to retaliate and do the same, as some have already done.  If that were to occur, the net number of respirators made available to the United States would actually decrease.  That is the opposite of what we and the administration, on behalf of the American people, both seek.”

Roman added: “The idea that 3M is not doing all it can do to fight price gouging and unauthorized reselling is absurd.”

--President Trump warned against “witch hunts” during the pandemic after Speaker Nancy Pelosi said she will create a bipartisan House Select Committee to track the federal response to the outbreak.

The committee, which will be chaired by Democratic Whip Jim Clyburn  (S.C.), will have the power to issue subpoenas. The panel will focus on accountability, transparency, and oversight of the federal coronavirus response, hoping to also include supervision to the $2 trillion stimulus package.

So during the Thursday press briefing, Trump said: “This is not the time for politics. Endless partisan investigations – here we go again – have already done extraordinary damage to our country in recent years.  You see what happens.  It’s witch hunt after witch hunt, and in the end the people doing the witch hunt have been losing, and they’ve been losing by a lot.”

--Republican Gov. Larry Hogan of Maryland: “(Trump) at times just says whatever comes to mind, or tweets, then someone on TV is saying the opposite.  It’s critically important that the message is straightforward and fact-based for the public.”

Philip Rucker and Robert Costa / Washington Post

“Trump has often sought to rewrite history.  He now says Covid-19…is nothing like the seasonal flu because it is far more contagious and “vicious,” as if pretending his many previous flu comparisons never had been uttered.  And now he says he has known since it was first detected in China that the coronavirus was horrible and would become a pandemic, as if he could halt the playback reel of his past comments minimizing the threat.”

Fact: Trump did not begin releasing guidelines for social distancing and other ways citizens could slow the spread until March 16, well after the virus already had spread across the United States.

I’ll never forget March 16, myself.  I drove over to a local restaurant that morning to cancel my charity organization’s meeting set there for March 18.  By the time I got back home, the governor had issued an edict shutting down such establishments.

--It was terrifying to see Jared Kushner suddenly appear Thursday as a key member of the Coronavirus Task Force we didn’t know he was even on…at least he very arrogantly presented himself that way, with the president’s approval.  He seems to have anointed himself Lord of the Supplies, “our” supplies, as he put it, not the states.

Michelle Goldberg / New York Times

“Kushner has succeeded at exactly three things in his life.  He was born to the right parents, married well and learned how to influence his father-in-law.  Most of his other endeavors – his biggest real estate deal, his foray into newspaper ownership, his attempt to broker a peace deal between the Israelis and the Palestinians – have been failures.”

A Politico headline this week read: “Behind the scenes, Kushner takes charge of coronavirus response.”

He’s nothing but a punk.  And a very bad person, just like his convicted father.  Ditto Stephen Miller.

--House Speaker Nancy Pelosi, in an appearance on Jake Tapper’s “State of the Union” Sunday, said President Trump’s “denial at the beginning was deadly” and that as he “fiddles, people are dying.”

Asked by Tapper if she believes Trump’s downplaying of the crisis has cost American lives, Pelosi responded, “Yes, I am.  I’m saying that.”

“Because when he made the other day when he was signing the bill, he said just think 20 days ago everything was great.  No, everything wasn’t great,” she said.  “We had nearly 500 cases and 17 deaths already.  And in that 20 days because we weren’t prepared, we now have 2,000 deaths and 100,000 cases.”

--It is pathetic and deeply disturbing that Dr. Anthony Fauci has been forced to beef up his security detail.  Greater exposure has led to more praise for him but also more criticism.  He’s the target of some right-wing commentators and bloggers, as they press President Trump to ease restrictions to reinvigorate the economy.

When asked Wednesday whether he was receiving security protection, Fauci told reporters, “I would have to refer you to HHS on that.  I wouldn’t comment.”

The president then interjected, saying, “He doesn’t need security.  Everybody loves him.”

--Trump tweets:

“Somebody please explain to Cryin’ Chuck Schumer that we do have a military man in charge of distributing goods, a very talented Admiral, in fact.  New York has gotten far more than any other State, including hospitals & a hospital ship, but no matter what, always complaining…

“…It wouldn’t matter if you got ten times what was needed, it would never be good enough.  Unlike other states, New York unfortunately got off to a late start.  You should have pushed harder. Stop complaining & find out where all of these supplies are going. Cuomo working hard!”

“Massive amounts of medical supplies, even hospitals and medical centers, are being delivered directly to states and hospitals by the Federal Government.  Some have insatiable appetites & are never satisfied (politics?).  Remember, we are a backup for them. The complainers should...

“…have been stocked up and ready long before this crisis hit.  Other states are thrilled with the job we have done.  Sending many Ventilators today, with thousands being built.  51 large cargo planes coming in with medical supplies.  Prefer sending directly to hospitals.”

“Congress must pass the old, and very strongly proven, deductibility by businesses on restaurants and entertainment.  This will bring restaurants, and everything related, back – and stronger than ever.  Move quickly, they will all be saved.”

[This is the stupidest ‘big idea’ out of the president’s mouth.  The world has changed, let alone the impact of this is less than ‘minimal.’]

“With interest rates for the United States being at ZERO, this is the time to do our decades long awaited infrastructure Bill.  It should be VERY BIG & BOLD. Two Trillion Dollars, and be focused solely on jobs and rebuilding the once great infrastructure of our Country! Phase 4.”

“I love Michigan, one of the reasons we are doing such a GREAT job for them during this horrible Pandemic.  Yet your Governor, Gretchen ‘Half’ Whitmer is way in over her head, she doesn’t have a clue.  Likes blaming everyone for her own ineptitude! #MAGA”

“Because the ‘Ratings’ of my News Conferences etc. are so high, ‘Bachelor finale, Monday Night Football type numbers’ according to the @nytimes, the Lamestream Media is going CRAZY.  ‘Trump is reaching too many people, we must stop him,’ said one lunatic. See you at 5:00 P.M.!”

“The Lamestream Media wants us to fail.  That will NEVER happen!”

Wall Street

The number of Americans seeking unemployment benefits hit a record high for the second week in a row, a sickening/tragic 6.648 million, after last week’s 3.28 million.  Prior to this, the record during the financial crisis was 695,000.  That sums it up.

We then had the jobs report for March today and it reflected a loss of 701,000, far worse than expected as it was felt it would take the Labor Department until April’s report to reflect the true early damage from the economy hitting a brick wall.  The leisure and hospitality sector lost 459,000.  The monthly job loss was the first in over nine years, Oct. 2010.

The unemployment rate rose from 3.5% to 4.4%, and of course is headed much higher.

There isn’t a single person on Wall Street who has any idea just how awful the jobs picture and growth will end up being.  But Goldman Sachs is saying GDP will fall 9% in the first quarter and 34% in the second, with unemployment rising to 15% by mid-year.  It then sees a rebound in GDP of 19% in the third quarter, with a recovery starting in May/June.

Morgan Stanley is calling for second quarter growth to plummet 38%, and it sees no return to near normal until end of 2021.

The Federal Reserve Bank of St. Louis projects that the unemployment rate will skyrocket to 32% by mid-year, the Great Depression peak being 25%.

Dallas Fed President Robert Kaplan said the jobless rate will leap into the low- or mid-teens, before falling to around 8% by year’s end.  There are a ton of people in this country who would accept that outcome.

Boston Federal Reserve President Eric Rosengren is concerned with the impact of the pandemic on real estate and office building prices, with many from all sides headed towards default.

“When we come back the question is whether we need the same amount of office space because we found work at home may be more effective.”

Rosengren, who in recent years has warned of the flipside of historically low Fed interest rates, encouraging unhealthy levels of borrowing, which such an overhang of debt could worsen the recession to come and slow the recovery from it, adding he expected banks will see more commercial real estate borrowers fall behind on payments.

There were some economic releases aside from the jobs numbers, with our first PMIs on manufacturing and services for March, all coming in better than expected, and all deceiving.

The closely followed Chicago purchasing managers index was 47.8 (50 being the dividing line between growth and contraction), when 39 was expected, but we’ll get there, and then some.

The national ISM reading for manufacturing was 49.1 vs. a prior reading for February of 50.1.  The non-manufacturing, service sector figure was 52.5, much better than an expected 45, but when you dig down, you see the supplier deliveries component was 62.1, which in a perverse way is all about shortages, not the traditional way of looking at such a reading equating to stronger demand.

The figures for all three next month will be quite different.

February construction spending was -1.3%, factory orders unchanged in the month.

The Atlanta Fed’s GDPNow barometer for the first quarter is down to 1.3%, but as they warn, it is totally empirically based and these days it doesn’t as yet reflect reality.

Peter S. Goodman / New York Times

“The world is almost certainly ensnared in a devastating recession delivered by the coronavirus pandemic.

“Now, fears are growing that the downturn could be far more punishing and long lasting than initially feared – potentially enduring into next year, and even beyond – as governments intensify restrictions on business to halt the spread of the pandemic, and as fear of the virus reconfigures the very concept of public space, impeding consumer-led economic growth.

“The pandemic is above all a public health emergency.  So long as human interaction remains dangerous, business cannot responsibly return to normal.  And what was normal before may not be anymore.  People may be less inclined to jam into crowded restaurants and concert halls even after the virus is contained.

“The abrupt halt of commercial activity threatens to impose economic pain so profound and enduring in every region of the world at once that recovery could take years.  The losses to companies, many already saturated with debt, risk triggering a financial crisis of cataclysmic proportions.

“ ‘I feel like the 2008 financial crisis was just a dry run for this,’ said Kenneth S. Rogoff, a Harvard economist and co-author of a history of financial crises, ‘This Time Is Different: Eight Centuries of Financial Folly.’

“ ‘This is already shaping up as the deepest dive on record for the global economy for over 100 years,’ he said.  ‘Everything depends on how long it lasts, but if this goes on for a long time, it’s certainly going to be the mother of all financial crises.’

“The situation looks uniquely dire in developing countries, which have seen investment rush for the exits this year, sending currencies plummeting, forcing people to pay more for imported food and fuel, and threatening governments with insolvency – all of this while the pandemic itself threatens to overwhelm inadequate medical systems.

“Among investors, a hopeful scenario holds currency: The recession will be painful but short-lived, giving way to a robust recovery this year.  The global economy is in a temporary deep freeze, the logic goes.  Once the virus is contained, enabling people to return to offices and shopping malls, life will snap back to normal.  Jets will fill with families going on merely deferred vacations.  Factories will resume, fulfilling saved up orders.

“But even after the virus is tamed – and no one really knows when that will be – the world that emerges is likely to be choked with trouble, challenging the recovery.  Mass joblessness exacts societal costs.   Widespread bankruptcy could leave industry in a weakened state, depleted of investment and innovation….

“ ‘The psychology won’t just bounce back,’ said Charles Dumas, chief economist at TS Lombard, an investment research firm in London.  ‘People have had a real shock.  The recovery will be slow, and certain behavior patterns are going to change, if not forever at least for a long while.’”

It’s grim…it’s also just reality.  Peter Goodman goes on and on, raising issues like the $2.7 trillion in debt developing countries are on the hook for.

Or the following from Randall W. Forsyth / Barron’s:

“But once the pandemic recedes, significant, longer-term effects might be apparent. And they aren’t likely to be positive.

“Wartime finances that balloon budget deficits and that are covered by money-printing have proved inflationary throughout history.

“At the same time, globalization – already in retreat in the trade wars – will be curtailed further, as supply chains are relocated to avoid crossing borders, rather than to maximize comparative advantage.  That will raise the cost of internationally traded goods at a time when prices of services already are moving higher.

“While the coronavirus pandemic might seem to be an odd time to be thinking about inflation, writes Julian Brigden of Macro Intelligence 2 Partners, he sees the crisis accelerating the ‘generational inflection point’ in macroeconomics.  ‘But we are now entering an era of monetarily financed fiscal policy, just as the trend to de-globalization accelerates. This is going to be very inflationary,’ he writes.”

Europe and Asia

The data from the eurozone (EA19) on the PMI side was atrocious for March as expected.

The final eurozone composite index was 29.7 vs. February’s 51.6.  The reading was even below last week’s flash estimate of 31.4.  Manufacturing came in at 44.5, services 26.4.

Germany 45.4 mfg., 31.7 services
France 43.2, 27.4
Italy 40.3, 17.4…yes, 17.4
Spain 45.7, 23.0
Ireland 45.1, 32.5

Netherlands 50.5 mfg.
Greece 42.5 mfg., down from 56.2

UK 47.8, 34.5

Chris Williamson, chief economist, IHS Markit:

“With various countries stepping up their measures to contain the spread of the coronavirus, it’s no surprise to see the final PMI for March indicated an even steeper deterioration of business activity than the prior record decline signaled by the provisional ‘flash’ estimate. The data indicate that the eurozone economy is already contracting at an annualized rate approaching 10%, with worse inevitably to come in the near future.

“The service sector is currently seeing an especially severe impact from the Covid-19 outbreak, with travel, tourism, restaurants and other leisure activities all hit hard by virus containment measures.

“No countries are escaping the severe downturn in business activity, but the especially steep decline in Italy’s service sector PMI to just 17.4 likely gives a taste of things to come for other countries as closures and lockdowns become more prevalent and more strictly enforced in coming months.

“While employment is not yet falling as fast as seen during the financial crisis, the coming months will no doubt see jobless numbers rise sharply, even as governments across the eurozone seek to limit these.  However, the ultimate economic cost of the Covid-19 outbreak cannot be accurately estimated until we get more clarity on the duration and scale of the pandemic.”

Separately, Eurostat had a number of releases for the EA19.

The February unemployment rate in the eurozone was 7.3% vs. 7.8% in Feb. 2019, the lowest rate since March 2008.

Germany 3.2% France 8.1%, Italy 9.7%, Spain 13.6%, Netherlands 2.9%, Ireland 4.8%.

But from here on this metric is going to get ugly.

Retail sales in February increased by 0.9% in the euro area vs. January, up 3.0% year-over-year.

A flash estimate on EA19 inflation in March was 0.7%, 1.2% ex-food and energy.

--One other item.  Some crisis measures and emergency powers put in place amid the pandemic could be threatening democracy and human rights, 13 EU states warned in a joint statement issued Wednesday.

“We are deeply concerned about the risk of violations of the principles of rule of law, democracy and fundamental rights arising from the adoption of certain emergency measures,” the statement issued by the Dutch Foreign Ministry on behalf of the group says.

“Emergency measures should be limited to what is strictly necessary, should be proportionate and temporary in nature, subject to regular scrutiny, and respect the aforementioned principles and international law obligations,” it says.

The statement was clearly aimed at Hungary, whose autocratic prime minister, Viktor Orban, was allowed by parliament to rule by decree without a set time limit.

Under the new law, individuals publishing what is viewed to be fake news or distorted facts face several years in jail.

Turning to Asia…in China, the official government PMI readings for March showed a rebound over February in manufacturing, 52.0 vs. 35.7, and in services, 52.3 vs. 29.6, according to the National Bureau of Statistics.  But this is highly deceiving, especially on the manufacturing side as global demand dries up (save for PPE and toys!).

The private Caixin readings, which measure small- and medium-sized businesses, had manufacturing rebounding to 50.1 vs. 40.3, and services 43.0 vs. 26.5. 

Reminder, the service sector is now 60% of China’s economy.

Analysts from Societe Generale said in a note on Thursday: “There are signs of lasting damage to domestic demand, and on top of that the external shock resulting from widespread lockdowns in other major economies is arriving fast and furious.”

Here’s a telling factoid.  A total of 495 cinemas, or 4.4 percent of China’s total, had opened by Tuesday a week ago, government data showed, but they attracted just two people per cinema per day.  Days later, they were ordered to shut again as the government looked to contain a potential second wave of coronavirus infections in the country.

Japan’s manufacturing PMI came in at 44.8 for March, while the service sector reading was a putrid 33.8.

And then we had the announcement the Tokyo Olympics were being postponed to next year, which is going to be incredibly costly at the worst time possible.  Plus, in the days since the decision was made, Japan announced a significant uptick in coronavirus cases.  Last Sunday, Tokyo alone reported a single day high of 68.  Critics say that it is no coincidence that Japan did not voice alarm over Covid-19 until it had given up hope of staging the Games.  The containment policy has been limited and Japan may now pay a steep price.

South Korea’s manufacturing PMI was 44.2 last month, while Taiwan’s was up to 50.4.

Lastly, Hong Kong’s retail sales fell by a record 44% in February from a year earlier, as travel restrictions kept tourists away and residents avoided shopping centers to prevent the spread of the virus.

Street Bytes

--Stocks resumed their downtrend after the prior week’s record gains, the Dow Jones falling 2.7% to 21052, the S&P 500 2.1% and Nasdaq 1.7%.  The small-cap Russell 2000 plunged 7.1% and is now down 37% for the year.

Tuesday marked the end of a bloody first quarter, the Dow’s worst quarter since 1987, down 23%, while the S&P had its worst quarter since 2008 and worst first quarter ever.  Nasdaq fell 14%.

First-quarter earnings will begin to come out next week and a rough estimate for the S&P 500 is for them to have fallen about 10%.

--U.S. Treasury Yields

6-mo. -0.13%  2-yr. 0.23%  10-yr. 0.59%  30-yr. 1.21%

The yield on the 10-year is at an all-time weekly closing low.

--President Trump said he was inviting U.S. oil executives to the White House today to discuss ways to help a sector “ravaged” by slumping energy demand that has more than collapsed.  It’s basically non-existent. 

Monday, Trump said Saudi Arabia and Russia “both went crazy” over oil prices.  “We don’t want to have a dead industry that’s wiped out,” the president said in an interview with Fox News. 

Oil traded below $20 briefly on Monday, its lowest level since February 2002.

Trump then said he had very “good calls” with Vladimir Putin and the Crown Prince, and tweeted yesterday:

“Just spoke to my friend MBS (Crown Prince) of Saudi Arabia, who spoke with President Putin of Russia, & I expect & hope that they will be cutting back approximately 10 Million Barrels, and maybe substantially more which, if it happens, will be GREAT for the oil & gas industry!

“….Could be as high as 15 Million Barrels.  Good (GREAT) news for everyone!”

But, again, there is zero demand, and the world is flooded with crude; at least 20 million barrels per day oversupplied, currently, and the lost demand could be as high as 35 million bpd.

U.S. oil supplies, for example, surged last week, with inventories increasing by 13.8 million barrels in the week ended March 27 to 469.2 million barrels, the Energy Information Administration said.  A week earlier, stockpiles rose by 1.6 million barrels.

Storage facilities are topped out.

And there are zero details as to how any deal to drastically cut supply would be implemented.

Late this afternoon at the president’s daily press briefing we then learned that his meeting with oil executives was worthless, and Trump conceded both Russia and Saudi Arabia had made no commitments to significantly reduce production.  OPEC is going to be demanding anyway that any production cuts they agree to must be matched by U.S. companies.

Oil spiked to $29 with a huge rally the last two days on Trump’s tweets, but it should collapse all over again next week.

An emergency meeting of OPEC+ members is being held Monday.

Wednesday morning, shale producer Whiting Petroleum Corp. filed for Chapter 11 bankruptcy; the first major casualty from the free fall in the price of crude. 

Whiting, once the largest oil producer in North Dakota’s Bakken region, has seen its market capitalization shrink to below $40 million from as much as $15 billion at its peak in 2011, when investors were first discovering the burgeoning shale sector.

The company is working on a major restructuring where it gives up 97% of its equity to creditors in exchange for a large reduction of its debt.

Separately, the U.S. oil rig count slumped by 62 to 562 over the week ended April 3 to the lowest level since January 2017, per Baker Hughes.

--The president is trying to shore up the oil market, while at the same time saying on Wednesday that he was looking at whether to ground some domestic air travel between cities that are coronavirus hot spots.

Separately, over the past two weeks at least 25 FAA air-traffic control facilities across the U.S. have been disrupted or temporarily shut down for antivirus cleaning.

--Department store operators Macy’s Inc. and Kohl’s Corp. were among those on Monday announcing they were furloughing thousands of employees as their stores remain shut.  Some 130,000 are impacted at Macy’s.  Kohl’s will furlough about 85,000 of 122,000.

Kohl’s CEO Michelle Gass said, “Given these extraordinary circumstances, we are taking difficult and decisive actions to strengthen our financial liquidity.”  Gass said she would not take a salary.  The company also said furloughed employees would continue to get health benefits.

Macy’s said employees enrolled in health benefits will receive coverage, at least through May.

Gap, which also owns Old Navy and Banana Republic, said it would furlough nearly 80,000 store employees in the U.S. and Canada.

L Brands, which owns Victoria’s Secret and Bath & Body Works said it would furlough most store staff, those not currently working to support the online businesses, on April 5 for six weeks.  L Brands has 94,400 employees, according to the company’s most recent annual filling.

--Boeing Co. is expected to begin offering early retirement and buyout packages as it comes to grips with the deepening toll the pandemic has wreaked on the aviation industry.  The company had previously announced a freeze on hiring and no overtime in order to preserve cash.

Boeing customers and some of its suppliers, on the other hand, are announcing layoffs.

CEO David Calhoun said he wants to prepare for when the crisis abates.  “I have to keep my workforce in place and we have got to be ready when the recovery comes.”

Boeing sought at least $60 billion in government aid for itself, its suppliers and the broader aerospace sector.

--British Airways announced it will “suspend” around 36,000 staff after grounding much  of its fleet.  BA has had to negotiate with the unions to reach an agreement where up to 80% of cabin crew, ground staff, engineers and executives will have their jobs suspended, but no staff is officially being laid off.  They just won’t be paid, though the UK government is offering some wages through its job retention scheme, which covers 80% of someone’s salary capped at a certain level.

--Some 4,700 jets have been parked globally as airlines slash operations due to travel restrictions, with American Airlines saying it is set to sharply increase the number of jets is it planning to retire, including the retirement of 76 Boeing 737s it acquired between 1999 and 2001, along with 34 Boeing 757s and 17 Boeing 767s it previously announced it was permanently retiring.  Eventually the new 737 MAX jets will arrive, allowing the company to help facilitate the retirement of older jets that are in need of heavy maintenance.

American then said late Thursday it will suspend more than 60% of international capacity for the peak summer travel season.  The carrier will cut Pacific flights by 80%, Atlantic flights by 65%, and Latin American flights by 48%.

--EasyJet, one of Europe’s largest airlines, said it would ground its entire fleet as demand collapses in the face of government restrictions on travel.

--As you might imagine, first-quarter and March auto sales in the U.S. were miserable and will only get far worse.  General Motors vehicle deliveries dropped 7.1% in the first quarter of the year, Fiat Chrysler’s fell 10%, and Ford’s declined 4%.

Hyundai reported its U.S. sales fell 43% in March.  Toyota said its sales were down nearly 37% in March and 8.8% for the quarter.  Nissan reported a 27% drop in first-quarter sales.

With auto showrooms shut during the pandemic, Fiat Chrysler and General Motors moved to reboot with seven-year, no-interest loans and programs allowing customers to buy vehicles online.  Fiat Chrysler’s “Drive Forward” marketing program includes online shopping tools that will for the first time allow U.S. customers to complete the purchase of a vehicle through an FCA dealer.

Meanwhile, Ford announced it was delaying the reopening of its major production factories in North America as a rise in Covid-19 infections continues to pose a threat to the health and wellbeing of its employees.  Ford had been looking to restart some operations April 6 and April 14 but those plans have been pulled back.

Then today it said most of its vehicle and engine production facilities in Europe will remain closed until May 4.

--Volkswagen AG took the unprecedented step of halting output on both sides of the Atlantic, a move costing the world’s largest automaker $2.2 billion per week.  CEO Herbert Diess said decisive action is critical to overcome the coronavirus pandemic.

--Walt Disney Co. on Thursday said it would begin to furlough employees “whose jobs aren’t necessary at this time” amid widespread business closures, in the latest sign of the harsh economic fallout from global coronavirus crisis.

The pandemic has shuttered Disney’s theme parks, cruise lines and retail stores, halted film and TV productions and delayed high-profile movie releases including “Mulan.”

Disney, which employs 223,000 people according to its annual report, did not say how many people would be out of work because of the decision.

--Visa said cardholders’ spending has fallen 4% in the U.S., while customers’ overseas spending has declined 19%.  In a regulatory filing, Visa said, “As countries have imposed social distancing, shelter-in-place or total lock-down orders, domestic spending, most notably in travel, restaurants, entertainment and fuel, has sharply declined.”

--Supermarket chain Kroger saw its shares move sharply higher after the company reported a 30% surge in March comparable sales, owing to panic buying of food and essentials.  Kroger maintained its annual outlook while raising wages for all hourly frontline grocery, supply chain, manufacturing, pharmacy and call center staff by $2 an hour until April 18.

--Conagra Brands Inc said it is adjusting its supply chain to meet a surge in demand for its food as more people are staying home.  Sales ballooned in March, up 50% for the four weeks ending March 22, more than making up for falling demand from restaurants that buy its food.

Conagra, makers of items such as Healthy Choice frozen meals and Chef Boyardee pastas, said it is operating its factories at near capacity.

--Huawei released its 2019 Annual Report this week, detailing a solid business performance.  The company’s global sales revenue rose 19.1% for the year, with net profit at $8.9 billion, up 5.6%, though its weakest growth in three years. 

Huawei dominates the smartphone market in China with a 38.5% market share in 2019.

[The company only has a formal annual report and then updates each quarter that are not fully audited.]

But Huawei warned on Tuesday that 2020 would be its most difficult year yet due to American trade restrictions which dealt a blow to its overseas sales in 2019 and predicted the Chinese government would retaliate against the United States. The world’s largest maker of telecom equipment maker said Beijing could hit back against U.S. measures to restrict chip sales in Huawei, by restricting sales of American products in China and by shifting to alternative suppliers in China and South Korea.

“The Chinese government will not just stand by and watch Huawei be slaughtered on the chopping board,” Chairman Eric Xu told reporters.  “Why wouldn’t the Chinese government ban the use of 5G chips or 5G chip-powered base stations, smartphones and other smart devices provided by American companies, for cybersecurity reasons?”

The United States alleges the Chinese government could use Huawei’s equipment to spy, an accusation rejected by the company.  The Trump administration placed Huawei on a blacklist in May last year, citing national security concerns.

--Home Depot ordered all 2,300 stores in North America to stop sales of N95 masks to try to free them up for healthcare workers and other first responders during the crisis.  This comes after President Trump said the government’s stockpile of personal protective equipment had nearly been depleted by the states.

During an appearance on CNBC last week, the aforementioned Mike Roman of 3M, which makes N95 masks, expressed concern over some retailers continuing to sell protective gear.

“It’s disappointing when you see that, because we’re trying to redirect everything to health care workers,” he said.

--Bank of New York Mellon Corp. named Todd Gibbons as CEO, removing the interim tag he has carried the past six months after then-CEO Charles Scharf resigned to become president and CEO of Wells Fargo & Co.

Gibbons had been a longtime CFO at BNY.  He’s also a major reason why I went to Wake Forest.  We were friends at Summit High School, Todd a year ahead of me, and then when he was a freshman at Wake he treated me royally on my visit to the school for my interview.   He was later my ‘big brother’ in the fraternity I joined.

So congratulations, Todd. 

--Zoom, the wildly popular videoconferencing app, has come under fresh high-level scrutiny as its popularity soars during the coronavirus pandemic.

Zoom is now being used by millions of people for work and leisure, as lockdowns are imposed around the world, but its data security and privacy measures have been questioned.

New York Attorney General pointed out in a letter to the company that it has been slow to address issues.

Zoom has had security flaws in the past, including a vulnerability which allowed an attacker to remove attendees from meetings, spoof messages from users and hijack share screens.

--Canada’s manufacturing PMI for March was down to 46.1, in contraction mode like everyone else.

--The 56-year-old CFO of investment bank Jefferies, Peg Broadbent, died of coronavirus.  Peg, short for Peregrine, was a UK native who worked in the firm’s New York office.  He had been CFO at Jefferies since 2007.

--Luckin Coffee Inc., an upstart Chinese rival to Starbucks that touted itself as the country’s largest coffee chain by stores, said several employees fabricated much of its reported sales in 2019, the year the company went public on Nasdaq.

An internal investigation into the Xiamen-based company on Thursday said its chief operating officer and several others fabricated transactions amounting to $310 million from the second quarter to the fourth quarter of last year.

The news knocked 75% off the share value.

--SeaWorld Entertainment announced it will furlough more than 90% of its current employees as of April 1 as its parks remain closed.

--Shut-in television viewers tuned in to the game show “Let’s Make a Deal” in record numbers last week, registering its most-watched week since the show was brought back 11 years ago with Wayne Brady as host, the Nielsen company said.

“The Price is Right,” now hosted by Drew Carey, had its biggest audience in four years.

And it was also a terrific week for television uber-producer Dick Wolf, whose Windy City-based trilogy of dramas dominates NBC’s lineup.  “Chicago Fire” saw its biggest audience in six years, while “Chicago Med” and “Chicago PD” had their largest audiences in four years.

Also having their highest ratings ever were relatively new shows “FBI” and “FBI: Most Wanted” on CBS.

CBS was the most popular network in prime time, averaging 6.3 million viewers and led by the best ratings for “NCIS” this year.  NBC had 4.72 million viewers in prime time, ABC 4.66 million, and Fox 3.4 million.

Fox News Channel averaged 4.23 million viewers in prime time in the cable wars, followed by MSNBC at 2.32 million, and CNN 2.19 million.

ABC’s “World News Tonight” led the evening newscasts with an average of 11.9 million, with NBC’s “Nightly News” at 11 million and the “CBS Evening News” 7.4 million.

Among the week’s top 20 shows in prime time, “60 Minutes” was third, behind “FBI” and “NCIS.”

--Fox Business host Trish Regan is leaving the network following comments she made on her show earlier in March that some people took to suggest the risk from coronavirus was being overstated for political reasons.

On her show, Regan said Democrats and the “liberal media” were using the virus to “destroy the president.”  She also blamed stock market declines on Trump’s rivals, calling it “another attempt to impeach the president.”

I always found Ms. Regan to be highly unlikable.

--According to Nielsen sales of alcoholic beverages rose 55% in the week ending March 21.

Liquor sales were up 75% over the same period in 2019.  Wine sales were up 66% and beer sales were up 42%.  I contributed heroically to the latter.

Foreign Affairs

Iran: President Trump on Wednesday warned Iran and its proxies against attacking U.S. troops or assets in Iraq, citing a possible “sneak attack” but giving no other details.  Trump tweeted:

“Upon information and belief, Iran or its proxies are planning a sneak attack on U.S. troops and/or assets in Iraq.  If this happens, Iran will pay a very heavy price, indeed!”

A top military aide to Iran’s Supreme Leader Ayatollah Ali Khamenei cautioned the United States hours before of consequences of “provocative actions” in Iraq, Iranian news agencies reported.  “We advise U.S. politicians and military to take responsibility for the consequences of their provocative actions (in Iraq),” General Yahya Rahim Safavi said.  “Any U.S. action will mark an even larger strategic failure in the current president’s record.”

Separately, the United States now believes Iran’s Ministry of Intelligence and Security was directly involved in the killing of an Iranian dissident last November in Turkey.  Masoud Molavi Vardanjani was shot dead on an Istanbul street on Nov. 14, 2019. 

China: Regarding Beijing’s transparency as the coronavirus took hold, Vice President Mike Pence said on CNN Wednesday: “The reality is that we could have been better off if China had been more forthcoming.  What appears evident now is that long before the world learned in December that China was dealing with this, and maybe as much as a month earlier than that, that the outbreak was real in China.”

Nebraska Republican Sen. Ben Sasse said: “Without commenting on any classified information, this much is painfully obvious: The Chinese Communist Party has lied, is lying, and will continue to lie about coronavirus to protect the regime.”

North Korea: Pyongyang fired off two more short-range ballistic missiles on Sunday.  The enhanced bottle rockets flew 143 miles at a maximum altitude of 19 miles, according to South Korea’s Joint Chiefs of Staff.

These are the eighth and ninth missiles launched in four rounds of tests in March, the most ever in a single month by the North.

Russia: President Vladimir Putin, who just until two weeks ago was sloughing off the coronavirus danger, on Thursday prolonged until April 30 a paid non-working period across Russia.  Russia has reported over 4,000 cases with 34 deaths.

Putin delivered a televised speech to the nation, saying the partial lockdown and this week’s non-working period had helped slow the contagion, but that the latter needed to be extended.

For his part Putin is being monitored after a doctor he met last week tested positive for Covid-19.  The medic gave Putin a tour of Moscow’s main coronavirus hospital last week and neither of them was wearing protective equipment during their conversation, TV footage from the visit showed.

Brazil: As of Wednesday, just 35% of Brazilians called President Jair Bolsonaro’s handling of the coronavirus crisis “good” or “great,” according to a Datafolha survey.  I can guarantee this will decline much further.

But Bolsonaro has continued his stand-off with state governments by suggesting that democracy could be at risk if the coronavirus crisis leads to social chaos.  He has criticized governors in the hardest-hit Brazilian states, calling them “job-killers” for declaring lockdowns to limit the spread.

“When the situation is heading toward chaos, with mass unemployment and hunger, it’s fertile ground for some to exploit, seeking a way to reach power and never leave it,” Bolsonaro told reporters.  He has warned that Brazil could break with “democratic normalcy,” citing the risk of rioting and suggesting “the left” could capitalize on any chaos, without elaborating.

Last weekend in a television interview, Bolsonaro called coronavirus “a small cold” that would kill only old people.  “I’m sorry, some people will die, they will die, that’s life,” as he encouraged Brazilians to get out and work rather than isolating themselves.

The death toll is 343 as of today.

Meanwhile, Health Minister Luiz Henrique Mandetta has seen his support rise as he gives technocratic daily briefings presenting the latest science, stressing the need for social distancing measures that Bolsonaro stupidly ignored.  In cabinet meetings, Mandetta has reinforced his opposition to public gatherings.

A popular Brazilian rapper MV Bill added his voice to the criticism of Bolsonaro as he warned that contagion could be explosive in Brazil’s crowded “favelas” or slums, such as Rio’s City of God where he was born, some with no running water.

Pakistan: Editorial / New York Post

“While the rest of the world deals with the Covid-19 pandemic, Pakistan is busy letting murderers go free.

“On Thursday, a Pakistani local court overturned the conviction of a British-Pakistani man for orchestrating the kidnapping and beheading of Wall Street Journal reporter Danny Pearl in 2002.

“A full 18 years after the fact, the court found Ahmed Omar Saeed Sheik guilty of the lesser charge of kidnapping and sentenced him to seven years in prison.  He’ll likely get out for time already served.

“With much of Pakistan sympathetic to violent Islamists, the move reeks of corruption.  Tellingly, the court also overturned the convictions of three other men who had been serving life sentences in the case.

“On Jan. 23, 2002, Saeed lured Danny Pearl into a trap in Karachi with a promise of info for his investigation of ‘shoebomber’ Richard Reid’s links to militants there.  Days later, al Qaeda 9/11 mastermind Khalid Sheik Mohammed videotaped his gruesome murder of the reporter.

“As Pearl’s father, Judea, said, ‘It’s a mockery of justice.’  He continues: ‘Anyone with a minimal sense of right and wrong now expects Faiz Shah, prosecutor general of [the Pakistani province] Sindh to do his duty and appeal this reprehensible decision to the Supreme Court of Pakistan.”

“Saeed & Co. should rot behind bars until their own Judgment Day.”

This is a scary story on so many levels, that the Pakistani government would allow this ruling to be made.  It leads one to renewed concern over the security of its nuclear weapons.

Random Musings

--Presidential tracking polls….

Gallup: 49% approval of President Trump’s job performance, 45% disapproval; 92% of Republicans approve, 43% of independents (March 13-22).
Rasmussen:  44% approve, 53% disapprove (April 3).

--In a new CNN poll conducted by SSRS, 48% of Americans say that the government has done a good job in preventing the spread of coronavirus, with 47% saying the government has done a poor job, an increase of four points in about three weeks.

77% of Republicans say the federal government is doing a good job preventing the virus’ spread vs. 27% of Democrats.

The CNN Poll was a random national sampling of 1,013 adults.

A new Washington Post/ABC News poll found Trump’s approval rating for handling the economy has hit the highest point yet during his three-plus years in office, with 57 percent of Americans approving – up five points since February – and 38 percent disapproving.  Needless to say, this is about to change drastically.

--The Democratic National Committee announced it was postponing the party’s convention from mid-July to the week of Aug. 17.  The move came hours after Joe Biden said he thinks his party’s nominating convention will have to be pushed back into August because of the coronavirus threat.

Of course who the heck knows where we will be by even June, let alone August.

And as for Bernie Sanders, he still hasn’t given an indication of when or how he might end his candidacy.

--House Speaker Nancy Pelosi said she wants to virus-proof the November election by including funding to boost voting by mail in the next pandemic response plan being put together by Democrats in the House of Representatives. 

I totally agree with this.  Here in New Jersey I’ve been voting by absentee ballot for years.  We need to plan today that the virus is probably back in the fall and regardless of the optimism we’ll have a much better handle on things then, we certainly don’t want our elderly feeling compelled to vote in person.

President Trump has said voting by mail would hurt the Republican Party.  Pelosi rejected that argument.  “When I was chair of the California Democratic party many years ago, the Republicans always prevailed in the absentee ballots.”

Indeed, some Democrats fear voting by mail could impact minorities and low-income voters who either move frequently or lack reliable access to mail service.

Today, when asked about Pelosi’s proposal, President Trump said there will be “no mail-in voting” as he pushed the idea of voter ID.  He said absentee balloting is subject to too much “cheating.”

This is going to be a massive issue by the summer if the pandemic hasn’t just drifted away…cough cough.

--North Carolina Republican Sen. Richard Burr is facing two potential investigations, one by the Justice Department, the other from the Securities and Exchange Commission, into his stock sales a week before the market began to collapse related to the coronavirus.

CNN reported the investigations may involve an additional five U.S. senators who also conducted stock sales before Feb. 20, including Georgia Senators Kelly Loeffler and David Perdue, Oklahoma’s Jim Inhofe, Wisconsin’s Ron Johnson and California Sen. Dianne Feinstein.

Burr has requested the Senate Ethics committee investigate his stock transactions.  He claims he was acting on public information and not just a Jan. 24 Senate briefing on the coronavirus that included Dr. Fauci.

--A skeleton crew is going to man critical stations while the USS Theodore Roosevelt is disinfected pierside in Guam, Acting Navy Secretary Thomas Modly said in an interview on Tuesday.

The majority of the crew is being removed after its commanding officer sent an urgent message asking for help controlling a Covid-19 outbreak.

“The key is to make sure that we can get a set of crew members that can man all those critical functions on the ship, make sure they’re clean, then get them back on while we clean the ship and get the other crew members off,” Modly said.

The 1,100-foot Theodore Roosevelt tied up in Guam after several sailors were discovered to be infected.  On Monday, Capt. Brett Crozier sent an extraordinary four-page letter asking for Navy help.  His warship has no space to give infected patients a separate berthing space and bathroom, so he asked for help ashore.

“The spread of the disease is ongoing and accelerating,” Crozier wrote in the March 30 letter.  “Decisive action is required.”

Crozier recommended isolating or quarantining 4,000 sailors for two weeks to ensure that no one carries the virus back aboard.  Meanwhile, about 10% of the crew would be needed to run the ship in port and disinfect it, he wrote.

“We are not at war.  Sailors do not need to die.  If we do not act now, we are failing to properly take care of our most trusted asset – our Sailors.”

“Keeping over 4,000 young men and women on board the TR is an unnecessary risk and breaks faith with those Sailors entrusted to our care,” the captain added.

So Thursday, Capt. Crozier was relieved of command.

Crozier “demonstrated extremely poor judgement in the midst of a crisis” by sending his four-page request for urgent help to people outside his chain of command, including a newspaper.

Acting Sec. Modly said Crozier could have “walked down the hall” to his immediate boss, the admiral in charge of the carrier’s strike group, or expressed his concerns in one of his conversations with Modly’s chief of staff.

Modly denied that the letter and its intense media coverage spurred the Navy into quicker action that was not already happening.  And he denied that Crozier’s firing was “retribution,” praising the captain for looking out for his crew and sounding alarms.

Former Vice President Joe Biden said in a statement that “the Navy sent a chilling message to the rest of the fleet about speaking truth to power.  The poor judgment here belongs to the Trump Administration, not a courageous officer trying to protect his sailors.”

Crozier was cheered wildly by his crew as he left the ship today.

Separately, the first U.S. military service member, a New Jersey Army National Guardsman, died last Saturday from Covid-19.

--One of my favorite senators of all time, Dr. Tom Coburn of Oklahoma, passed away.  An ultraconservative fiscal hawk, he knew his stuff, and wasn’t afraid to call out ignorant colleagues.  For this he drew scorn from both sides of the political aisle.

On many policy points Coburn was too far right for me, especially on some social issues, but in some respects he reminded me of Barry Goldwater.  Over time, in many respects Coburn is likely to be remembered more fondly than many in the country do today.

And, hell, he was friends with Barack Obama.  Coburn said of the future president, the two having arrived in the Senate together in 2005: “I think he’s a neat man.  You don’t have to be the same to be friends.  Matter of fact, the interesting friendships are the ones that are divergent.” 

Robert D. McFadden / New York Times

“A visceral foe of Washington long before such disaffections coalesced into the Tea Party, Mr. Coburn swept into Congress with the class of 1994, when Republicans gained control of the House for the first time in 40 years and installed Newt Gingrich as speaker and his ‘Contract With America’ agenda to shrink government, cut taxes and promote welfare reforms and business activity.

“Mr. Coburn soon set about displeasing everyone, including the constituencies most politicians covet: his own party’s activists, donors, leaders and congressional colleagues.  He battled with Mr. Gingrich often, charging that he was drifting to the political center and away from his contractual pledges to the nation.  He openly vented his disdain for career politicians.

“ ‘His contempt for them is genuine, bipartisan and in many cases mutual,’ The New York Times reported years later.  ‘He once prescribed a ‘spinal transplant’ for 70 percent of the Senate, and another time said his colleagues had ‘reproductive organs the size of BBs.’’”

Editorial / Wall Street Journal

“Politics is a lifetime career for most in American government, and then there are exceptions like Thomas Coburn.  The Oklahoma obstetrician who became a Senator and then returned to a productive private life died Saturday of prostate cancer at age 72.  He was what America’s Founders imagined in self-governing citizen legislators, and that mentality made him far more consequential than the usual congressional seat-fillers.

“Coburn worked in his family’s optical-lens firm before going to medical school and setting up an ob/gyn practice.  He ran for the House in 1994 in part to oppose the Clinton effort for government health care, served three terms and retired before running for Senate in 2004 for what he said would be no more than two terms.  He continued to see patients on weekends and Mondays in Oklahoma until the Senate declared it a (preposterous) conflict-of-interest.

“ ‘I don’t think Washington can fix Washington,’ Coburn told colleague Joe Rago in 2014 after announcing his retirement two years early when his cancer recurred.  ‘You’re always going to have this built-in conflict of getting re-elected.  Parochial interests will trump the best interests of the nation, and the actors will do what’s expedient to be popular. It doesn’t have to be that way.  There’s hundreds of thousands if not millions of people who could do these jobs well.  All it requires is common sense and courage.’

“Tom Coburn had both of those qualities, which he used to take on important causes that challenged both political parties.  He campaigned against parochial spending and waste, but unlike most Senators he did the homework on the details.  His investigation of fraud in the Social Security disability program was a model of Congressional oversight.

“Coburn challenged his own party on spending earmarks, making famous the ‘bridge to nowhere’ in Alaska that led to a broader earmark ban.  He took on special-interest tax subsidies and defeated the ethanol tax credit almost by himself.  He took a particular interest in health care and offered a roadmap for Republicans for free-market reform to reduce the tax subsidy for employer insurance that is skewed to the affluent; he wanted to use the savings to provide tax credits for lower-income workers whose bosses don’t offer insurance. The Trump Administration could do worse than campaign on a version of it this year.

“Many conviction politicians accomplish little because they care more about looking principled than advancing their principles.  Coburn was different because while firm in his convictions he was also pragmatic in forming alliances to get things done.   American politics would be healthier, and government would be less destructive, if we had more Tom Coburns.”

Amen.

From Joseph Rago’s interview with then-Sen. Coburn in the WSJ, Feb. 1, 2014.

“In 2000, Dr. Coburn kept his campaign promise to limit himself to three terms in the House and retired.  He returned in 2005, disgusted by the George W. Bush spending binge and especially the Medicare prescription-drug benefit.  He promptly made himself a senator non grata by exposing vanity-project spending like the $223 million ‘bridge to nowhere’ in Alaska.  Dr. Coburn suggested spending the money on a New Orleans bridge damaged by Hurricane Katrina.  Eight-two senators voted against him.

“His colleagues retaliated by trying to prevent Dr. Coburn from practicing medicine.  In the House, he was in the habit of flying home to Muskogee on weekends and seeing patients Monday mornings, and he was allowed by Senate rules to charge his patients enough to cover his expenses.  But in 2005, the Senate Ethics Committee ruled that the arrangement would be a conflict of interest.  ‘Somebody’s going to come to me for a Pap smear to influence my vote?’ he says.  ‘I mean, give me a break.’

“So Dr. Coburn offered his services free of charge.  Two years ago he stopped, when the yearly $40,000 to $80,000 payments for malpractice insurance became too much of a financial drain.

“Such affronts explain why Dr. Coburn is leaving the Senate…. ‘I know myself well enough to know my patience has worn thin, of continuing to push boulders up an ice flow,’ he says.”

--We note the passing of Rev. Joseph Lowery, 98, the “Dean” of the civil rights movement, the fiery Alabama preacher who was on the front line of the battle for equality.  For more than four decades after the death of his friend, the Rev. Martin Luther King Jr., Lowery carried the torch, with oratory steeped in scripture, refusing to back down whether the audience was a Jim Crow racist or a U.S. president.

At Barack Obama’s inaugural in 2009, Lowery gave the benediction: “We ask you to help us work for that day when black will not be asked to get in back; when brown can stick around; when yellow will be mellow; when the red man can get ahead, man; and when white  will embrace what is right.”

The King Center in Atlanta remembered Lowery in a tweet: “Tonight, the great Reverend Joseph E. Lowery transitioned from earth to eternity.  He was a champion for civil rights, a challenger of injustice, a dear friend to the King family.”

Lowery led the Southern Christian Leadership Conference for two decades, restoring the organization’s financial stability and pressuring businesses not to trade with South Africa’s apartheid-era regime.  He retired in 1997.

But then he lived to see the election of an African-American president.

In another high-profile moment, Lowery drew a standing ovation at the 2006 funeral of MLK’s widow, Coretta Scott King, when he criticized the war in Iraq, saying, “For war, billions more, but no more for the poor.”  President George Bush and his father, George H.W. Bush, were seated behind the pulpit.

The Rev. Joseph Lowery was a giant.  RIP.

--From the New York Times:

“Two weeks ago, amid the coronavirus pandemic, about 70 students from the University of Texas at Austin partied in Mexico on spring break.  The students, all in their 20s, flew on a chartered plane to Cabo San Lucas, and some returned on separate commercial flights to Texas.

“Now, 44 of them have tested positive for the virus and are self-isolating.”

The defiant attitude of spring breakers from schools all over the country was best embodied by Brady Sluder, a young man on spring break in Miami who declared from a packed beach: “If I get corona, I get corona.  At the end of the day, I’m not going to let it stop me from partying.”  He later apologized on Instagram.

“Generation Z” should be re-designated “Generation Idiot.”

--The Skagit Valley Chorale of Mount Vernon, Washington, debated whether to go ahead with a weekly rehearsal on March 6.  The coronavirus was already killing people in the Seattle area, about an hour’s drive to the south.

But Skagit County hadn’t reported any cases, schools and businesses remained open, and prohibitions on large gatherings had yet to be announced.

So the choir’s conductor informed the 121 members in an email that amid the “stress and strain of concerns about the virus,” practice would proceed as scheduled at the Mount Vernon Presbyterian Church.

Sixty singers showed up.  Hand sanitizer was offered at the door and there were no hugs and handshakes.  As they rehearsed they tried to keep some distance between each other.

Nearly three weeks later, 45 of the 60 have been diagnosed with Covid-19 or were ill with the symptoms.  At least three were hospitalized, and two are dead, per the Los Angeles Times earlier this week.

--Defying a state order banning gatherings of more than 50 people and a stay-at-home order issued on March 22, Louisiana Pentecostal preacher Tony Spell held a gathering of hundreds, leaping into the pews, parading, hugging and laying hands on worshipers’ foreheads in prayer.

“We’re free people.  We’re not going to be intimidated. We’re not going to cower,” Rev. Spell said from the pulpit of Life Tabernacle Church in a suburb of Baton Rouge.  “We’re not breaking any laws.”

You’re a bunch of f’n idiots.

--Larry David, the 72-year-old “Curb Your Enthusiasm” creator, was asked by California to produce a public service announcement urging all “idiots” in the state to sit at home and watch TV.

“I basically want to address the idiots out there, and you know who you are, you’re going out,” says David, “you’re socializing too close, it’s not good.”

“You’re hurting old people like me.  Well not me, I have nothing to do with you, I’ll never see you.”

David notes the state public health order aimed at curbing the spread of coronavirus has presented a golden opportunity to lounge on the couch and watch some television.

“I mean, I don’t know how you’re passing that up,” he says in the message, which the governor’s office tweeted out.

“Well, maybe because you’re not that bright,” David says.  “But here it is – go home!  Watch TV!  That’s my advice to you.”

---

Pray for the men and women of our armed forces…and all the fallen.

We pray for health care workers and all first responders who are putting themselves in harm’s way.

God bless America.

---

Gold $1648
Oil $29.00

Returns for the week 3/30-4/3

Dow Jones  -2.7%  [21052]
S&P 500  -2.1%  [2488]
S&P MidCap  -6.0%
Russell 2000  -7.1%
Nasdaq  -1.7%  [7373]

Returns for the period 1/1/20-4/3/20

Dow Jones  -26.2%
S&P 500  -23.0%
S&P MidCap  -35.2%
Russell 2000 -37.0%
Nasdaq  -17.8%

Bulls 31.4
Bears 36.3

Hang in there.  Wash your hands.

Brian Trumbore



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Week in Review

04/04/2020

For the week 3/30-4/3

[Posted 11:30 PM ET, Friday]

Note: StocksandNews has significant ongoing costs and your support is greatly appreciated.  Please click on the gofundme link or send a check to PO Box 990, New Providence, NJ 07974.

Edition 1,094

The death toll soared further globally this week.  Last time there had been 27,000 worldwide and tonight as I go to post the figure is over 59,100.

In one week, Italy has gone from a death toll of 9,134 to 14,681 (including 73 doctors and 24 nurses).  Spain from 4,934 to 10,935.  France 1,995 to 6,507.  The UK from 759 to 3,605.

Netherlands 546 to 1,487.  Belgium 289 to 1,143.

And the U.S., which sat at about 1,500 last Friday night is now over 7,300.

New York State is now at 3,218, exceeding the death toll from 9/11.

But there are a few even more distressing facts.  Until Thursday, Italy, Spain, France and the UK were only counting those that had died in the hospital…not those dying in nursing homes.  France began to catch up on this Thursday and the result was sickening.  Hundreds and hundreds added to the total, and they are just getting started.

So the total in Europe is no doubt much higher than being reported.  It will take time for this to reveal itself as you need to be accurate on whether the victims actually had coronavirus.  History demands it.

Of course history will look back and wonder what the truth is when it comes to China and Iran.  In Iran there is zero doubt the toll is thousands higher than being reported, 3,294 as of tonight.  Many believe that China’s true figure may be tens of thousands more than the 3,322 they are reporting.

Perhaps even more disturbing, however, is that cases in Japan, South Korea, and Singapore have been spiking back up.  Friday, Singapore, with all the precautions it has taken, reported its highest daily case total yet and the country has been locked down, except for essential industries.

And remember those new hordes of migrants attempting to get into Europe? 23 have tested positive in one Greek migrant camp.

This week Minnesota Democratic Sen. Amy Klobuchar, talking about her recovering husband, said what is so sad about Covid-19 is that it is the “lonely disease.”  “You can’t hold their hand to help them through their suffering,” adding, “people are not expendable.”

I happened on a note from Fionnan Sheahan, editor at the Irish Independent, to her readers:

“After all this ends, we’ll probably refer to life BC (Before Coronavirus) and AD (After the Disease) as every aspect of our health, lifestyle, society and values has been turned upside down in such a short period.”

Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, conceded that the pandemic could cause between 100,000 and 200,000 deaths in the United States.  The shortage of ventilators is the key immediate issue.  New York City is days away from a point where it won’t be able to meet demand.  It will be the same situation in New Orleans shortly.

For weeks, President Trump has been too casual in his approach to the outbreak, frequently downplaying it and telling reporters it would simply go away.

But Tuesday he said, “This is going to be a painful two weeks.  Our strength will be tested, our endurance will be tried.”

Yet there was the president on Thursday, disagreeing with his coordinator of the White House task force, Dr. Deborah Birx, on social distancing.

Birx said Americans were not doing a good enough job staying a safe distance apart, days into the new 30-day extension of the guidelines.

“When we said that, now over 16 days ago, that was serious,” Birx said, noting that the people who were now becoming sick would have gotten the virus after the guidelines first went out.  But the president, standing near Birx, interceded.  “Deborah, aren’t you referring to just a few states, because many of those states are dead flat,” Trump said, referring to states where the virus had not taken off dramatically and pushed up the national “curve” of deaths.  Birx responded that it was true that some states were flat but that an outbreak in a new city would spoil that.

So two days after adopting a somber tone, the president on Thursday was upset that Birx was focusing on areas where those measures had not been followed sufficiently rather than on states in which the virus had not taken off.  “It’s hard to blame flat-liners for not doing a good job,” Trump said, sparking Birx to express with emotion, “No, no, I don’t want to say that!”

Trump made clear he did not want headlines suggesting that not enough was being done, and he went on to explain repeatedly what he believed Birx meant.  “She wasn’t talking about the average of anything, she was talking about an individual state,” Trump said.  “Our states, generally speaking – it’s like lots of different countries all over – we have, many of those ‘countries’ are doing a phenomenal job.  They’re really flat, and I think that’s what you meant.”  Birx responded, “Thank you, sir.”  But then, exasperated, said, “We know what can be done.  And others are doing it and most of the people in the United States are doing it.  It’s our communities, it’s every American that has to make these changes,” she said.

Trump responded, “We’ve done, I think on average, really phenomenally as a country.”

Today, Trump waffled on the issue of wearing a mask. The CDC is recommending you wear one when you’re at the grocery store or pharmacy, so I’ve got my bandana ready because my town has a ton of cases and now reports of deaths in the neighboring community, but the president said he wasn’t going to wear one.

Also today, the president was questioned when he really knew about the risk of a pandemic, the reporter bringing up the point that a video has emerged of Health and Human Services Secretary Alex Azar from January 2019 wherein Azar talks of a potential pandemic.  Trump said, “What’s happened is very severe…I’ve known about pandemics.”

Azar said the administration had “great preparedness for pandemics… We’ve all been focused on pandemic preparedness.”

But the president reiterated one of his latest talking points, “The previous administration gave us very little shelf space…the shelves were empty…the military shelves also empty.”

It’s amazing how the president seems to forget we all know he has been in office well over three years.  It’s his problem.

There was Azar saying the administration has been focused on pandemic preparedness, so why then were the shelves barren?

Otherwise, all week it was nothing but constant claims of “We’re doing a great job!  We’ve done a job like no one’s ever done a job.”

---

Bill Gates, who predicted this pandemic in a “Ted Talk” in 2015, laid out a 3-step process in a Washington Post column Tuesday.

“There’s no question the United States missed the opportunity to get ahead of the novel coronavirus,” he wrote.  “But the window for making important decisions hasn’t closed.”

Some would argue by week’s end it has.

Gates’ advocates a total national shutdown for six to 10 weeks; nationwide testing “so we can quickly identify potential volunteers for clinical trials and know with confidence when it’s time to return to normal;” and we need a vaccine.

Referring to his Ted Talk, Gates said: “In 2015, I urged world leaders to prepare for a pandemic the same way they prepare for war – by running simulations to find the cracks in the system.  As we’ve seen this year, we have a long way to go.  But I still believe that if we make the right decisions now, informed by science, data and the experience of medical professionals, we can save lives and get the country back to work.”

Treasury Secretary Steven Mnuchin assured the nation that the relief checks of $1,200 ($3,400 for a family of four) will be going out in two weeks.  A memo from the House Ways and Means Committee said those without direct deposit information may not get checks until mid-August or later.  According to the document, starting the week of May 4, the IRS will begin issuing paper checks to individuals, but they will be issued at a rate of about 5 million a week, which means it could take up to 20 weeks to get all the checks out.

Robert J. Samuelson / Washington Post

“The danger of prematurely relaxing the lockdowns and quarantines is that the virus soars.  Little will have been gained.  Success requires public understanding of the difficult choices that are involved.  Trump should serve as the explainer in chief. But preoccupied by his own political future, he is hardly a model of courageous clarity.  On Sunday, Trump extended the guidelines for social distancing until the end of April. This implies that the president sided with his scientific advisers, at least temporarily.

“The larger issue is that politics in democracies are inevitably skewed toward short-term outcomes, not long-term gains.  This is a condition that, regardless of how the coronavirus drama turns out, should engage us all.”

Michael Morell and Kristin Wood / Washington Post

“Why does this keep happening to us?

“Once again, we didn’t do enough to respond to a threat that the experts saw coming in advance.  And, now we are paying the price.

“Experts have long seen a coronavirus-like pandemic as a threat.  In January 2019, Daniel Coats, then the director of national intelligence, warned that ‘the United States and the world will remain vulnerable to the next flu pandemic or large-scale outbreak of a contagious disease that could lead to massive rates of death and disability, severely affect the world economy, [and] strain international resources.’

“In September 2018, Anthony S. Fauci, our nation’s leading expert on infectious pathogens, told CBS News that ‘the thing most threatening to us…would be something that spread widely, generally a respiratory infection, something that has a high degree of morbidity and mortality.’

“And, just last year, the Trump administration ran a pandemic exercise simulating a severe influenza pandemic for which there was no vaccine.

“The draft conclusions said the United States was underprepared for a pandemic and was disorganized to deal with one.  It said the country didn’t have the capacity to manufacture personal protective equipment, needles and syringes, pointing out that these supplies, along with antiviral medications, respirators and ventilators, would be ‘limited and difficult to restock.’

“And, yet, we did not act on these warnings.

“We did not have a strategy on mitigation to reduce the threat of a pathogen. And we did not have a companion strategy on preparation – a plan and pre-outbreak set of actions to get ready for a pandemic to minimize the human and economic costs if mitigation failed.

“The Trump administration’s initial choices made this worse, but this failing does not just rest with them….

“(The) blame must be shared with every administration over the past 20 years.

“What has not happened this year is a stark reminder of what didn’t happen in the lead-up to the terrorist attacks of Sept. 11, 2001. Despite repeated strategic warnings over a number of years by the CIA that Osama bin Laden was coming after us, little action was taken to degrade al-Qaeda.  Yes, 9/11 was a tactical intelligence failure – in that the intelligence community did not know in advance the time, place or method – but it was also a policy failure, again by multiple administrations.

“Our failure this time will be much more costly than 9/11….

“Whatever its roots, we must overcome the tendency to under-prepare for threats that we can clearly see – as there are many more of them out there.  The most obvious and most important for sure is climate change, about which we and the world continue to avoid the necessary mitigation strategies.

“But, the list also includes the growing risk of nuclear war driven by the fraying of long-standing U.S.-Russian nuclear agreements, as well as the ongoing lack of economic opportunity that is putting American democracy and capitalism at risk.

“We need to do everything we can to support those on the front lines who are saving us from the coronavirus.  But we also need to consider it a wake-up call for us to change, to act more decisively on the warnings we receive.”

Emily Baumgaertner, James Rainey / Los Angeles Times

“Two months before the novel coronavirus is thought to have begun its deadly advance in Wuhan, China, the Trump administration ended a $200 million pandemic early-warning program aimed at training scientists in China and other countries to detect and respond to such a threat.

“The project, launched by the U.S. Agency for International Development in 2009, identified 1,200 different viruses that had the potential to erupt into pandemics, including more than 160 novel coronaviruses.  The initiative, called PREDICT, also trained and supported staff in 60 foreign laboratories – including the Wuhan lab that identified SARS-CoV-2, the new coronavirus that causes COVID-19.

“Field work ceased when the funding ran out in September, and organizations that worked on the PREDICT program laid off dozens of scientists and analysts, said Peter Daszak, president of EcoHealth Alliance, a key player in the program.

“On Wednesday, USAID granted an emergency extension to the program, issuing $2.26 million over the next six months to send experts who will help foreign labs squelch the pandemic. But program leaders say the funding will do little to further the initiative’s original mission.

“ ‘Look at the name: Our efforts were to predict this before it happens.  That’s the part of the program that was exciting – and that’s the part I’m worried about,’ Daszak said.”

From USA TODAY:

“The White House and congressional intelligence committees were briefed on the scope and threat of the coronavirus in January and February, but President Donald Trump has not stopped exports of key medical equipment – a move taken by at least 54 other countries so far.

“The data show how U.S. manufacturers stepped up production and cleared out inventory to supply protective medical equipment to China for weeks, even as the threat of the coronavirus became clear.  The CDC reported its first case in the United States on Jan. 20. Within the next two weeks, the World Health Organization and the U.S. Department of Health and Human Services had declared the disease a public health emergency.”

Finally, I didn’t have time to get into this last time but going back to February, President Trump hammered away at Sleepy Joe Biden and President Barack Obama for their mishandling of the H1N1 Swine Flu pandemic.  So I went back through my archives of the main period of that outbreak in the U.S., from April 2009 to April 2010, and picked a few items at random.

H1N1 was in no way comparable to Covid-19.  For starters, it was far less contagious.  Yes, some moves were made, such as I wrote on May 15, 2009, that “New York City Mayor Michael Bloomberg opted to close three schools because of renewed outbreaks of swine flu, so it’s still percolating… (the) real focus the next few months is on how the flu spreads in the Southern Hemisphere and the strength when it comes back in the fall.  WHO experts are now comparing the strain to 1957, not 1918.  But the ’57 Asian version could still kill 14 million and knock 2 percent off the global economy.”

June 6, 2009: “Meanwhile, the World Health Organization is closer to declaring H1N1 a pandemic but wants to be careful to note that the virus is not very lethal, being blamed for only 120 deaths, worldwide, thus far.

November 28, 2009: “While it appears swine flu has peaked in the Northern Hemisphere (though it is still spreading in the Middle East and Eastern Europe), there are signs around the world the H1N1 virus has mutated to a drug-resistant strain, which bears watching come next year and a potential second round.  There was a cluster at Duke University hospital for example that was drug resistant, as well as clusters in Britain, Norway and China that are being followed closely.

December 19, 2009: “From Global Security Newswire:

“The spread of the H1N1 flu virus through the United States this year revealed that the nation’s medical care system remains ill-prepared to handle the intensive demands that could develop from acts of bioterrorism or other major health crises.”

Feb. 27, 2010: “I believe, as Sen. Coburn hammered home, that a huge part of our healthcare problem is that we take too many tests.  I believe there should be far more of a very public emphasis on prevention, much of which can be accomplished at little cost with some very effective public service announcements, for crying out loud.  Look how effective all our pronouncements on washing one’s hands proved to be in combating H1N1.  The president led that effort.  We need more of that.”

Boy, we have short memories.

And by the way, from April 2009 to April 2010, I went to Iceland, Calgary (for The Stampede), North Carolina, Ireland, Oregon, Kiawah (to run a half-marathon), Albania and Lebanon.

Yes, H1N1 may have been labeled a pandemic but it was not Covid-19.  One source I looked at said there were 42…42…confirmed deaths in New Jersey.  As of tonight, my state has suffered 646 deaths, almost all in the last two weeks.

And to the idiots who were saying a few weeks ago that the death toll from the coronavirus would be no worse than the number of deaths on our roads, the number of traffic-related fatalities in New Jersey in 2018 was an estimated 563, including 179 who were pedestrians.

Trump World

--Trump went after 3M Co. in a total hatchet job that was unfair and grossly ignorant, saying in a tweet late on Thursday that he was invoking the Defense Production Act to get the company to produce face masks.

“We hit 3M hard today after seeing what they were doing with their Masks.  ‘P Act’ all the way. Big surprise to many in government as to what they were doing – will have a big price to pay!”

3M CEO Mike Roman told CNBC today, “The narrative that we aren’t doing everything we can as a company is just not true.”  The company secured China’s approval to export to the U.S. 10 million N-95 respirators manufactured by the company in China.  It is doing all it can to ramp up production at its U.S. facilities, but, yes, it has supplied masks to some countries in dire need of them as well for “humanitarian” reasons, most of the time from plants 3M has in those very countries.

In a statement, the company said that ending exports of respirators “would likely cause other countries to retaliate and do the same, as some have already done.  If that were to occur, the net number of respirators made available to the United States would actually decrease.  That is the opposite of what we and the administration, on behalf of the American people, both seek.”

Roman added: “The idea that 3M is not doing all it can do to fight price gouging and unauthorized reselling is absurd.”

--President Trump warned against “witch hunts” during the pandemic after Speaker Nancy Pelosi said she will create a bipartisan House Select Committee to track the federal response to the outbreak.

The committee, which will be chaired by Democratic Whip Jim Clyburn  (S.C.), will have the power to issue subpoenas. The panel will focus on accountability, transparency, and oversight of the federal coronavirus response, hoping to also include supervision to the $2 trillion stimulus package.

So during the Thursday press briefing, Trump said: “This is not the time for politics. Endless partisan investigations – here we go again – have already done extraordinary damage to our country in recent years.  You see what happens.  It’s witch hunt after witch hunt, and in the end the people doing the witch hunt have been losing, and they’ve been losing by a lot.”

--Republican Gov. Larry Hogan of Maryland: “(Trump) at times just says whatever comes to mind, or tweets, then someone on TV is saying the opposite.  It’s critically important that the message is straightforward and fact-based for the public.”

Philip Rucker and Robert Costa / Washington Post

“Trump has often sought to rewrite history.  He now says Covid-19…is nothing like the seasonal flu because it is far more contagious and “vicious,” as if pretending his many previous flu comparisons never had been uttered.  And now he says he has known since it was first detected in China that the coronavirus was horrible and would become a pandemic, as if he could halt the playback reel of his past comments minimizing the threat.”

Fact: Trump did not begin releasing guidelines for social distancing and other ways citizens could slow the spread until March 16, well after the virus already had spread across the United States.

I’ll never forget March 16, myself.  I drove over to a local restaurant that morning to cancel my charity organization’s meeting set there for March 18.  By the time I got back home, the governor had issued an edict shutting down such establishments.

--It was terrifying to see Jared Kushner suddenly appear Thursday as a key member of the Coronavirus Task Force we didn’t know he was even on…at least he very arrogantly presented himself that way, with the president’s approval.  He seems to have anointed himself Lord of the Supplies, “our” supplies, as he put it, not the states.

Michelle Goldberg / New York Times

“Kushner has succeeded at exactly three things in his life.  He was born to the right parents, married well and learned how to influence his father-in-law.  Most of his other endeavors – his biggest real estate deal, his foray into newspaper ownership, his attempt to broker a peace deal between the Israelis and the Palestinians – have been failures.”

A Politico headline this week read: “Behind the scenes, Kushner takes charge of coronavirus response.”

He’s nothing but a punk.  And a very bad person, just like his convicted father.  Ditto Stephen Miller.

--House Speaker Nancy Pelosi, in an appearance on Jake Tapper’s “State of the Union” Sunday, said President Trump’s “denial at the beginning was deadly” and that as he “fiddles, people are dying.”

Asked by Tapper if she believes Trump’s downplaying of the crisis has cost American lives, Pelosi responded, “Yes, I am.  I’m saying that.”

“Because when he made the other day when he was signing the bill, he said just think 20 days ago everything was great.  No, everything wasn’t great,” she said.  “We had nearly 500 cases and 17 deaths already.  And in that 20 days because we weren’t prepared, we now have 2,000 deaths and 100,000 cases.”

--It is pathetic and deeply disturbing that Dr. Anthony Fauci has been forced to beef up his security detail.  Greater exposure has led to more praise for him but also more criticism.  He’s the target of some right-wing commentators and bloggers, as they press President Trump to ease restrictions to reinvigorate the economy.

When asked Wednesday whether he was receiving security protection, Fauci told reporters, “I would have to refer you to HHS on that.  I wouldn’t comment.”

The president then interjected, saying, “He doesn’t need security.  Everybody loves him.”

--Trump tweets:

“Somebody please explain to Cryin’ Chuck Schumer that we do have a military man in charge of distributing goods, a very talented Admiral, in fact.  New York has gotten far more than any other State, including hospitals & a hospital ship, but no matter what, always complaining…

“…It wouldn’t matter if you got ten times what was needed, it would never be good enough.  Unlike other states, New York unfortunately got off to a late start.  You should have pushed harder. Stop complaining & find out where all of these supplies are going. Cuomo working hard!”

“Massive amounts of medical supplies, even hospitals and medical centers, are being delivered directly to states and hospitals by the Federal Government.  Some have insatiable appetites & are never satisfied (politics?).  Remember, we are a backup for them. The complainers should...

“…have been stocked up and ready long before this crisis hit.  Other states are thrilled with the job we have done.  Sending many Ventilators today, with thousands being built.  51 large cargo planes coming in with medical supplies.  Prefer sending directly to hospitals.”

“Congress must pass the old, and very strongly proven, deductibility by businesses on restaurants and entertainment.  This will bring restaurants, and everything related, back – and stronger than ever.  Move quickly, they will all be saved.”

[This is the stupidest ‘big idea’ out of the president’s mouth.  The world has changed, let alone the impact of this is less than ‘minimal.’]

“With interest rates for the United States being at ZERO, this is the time to do our decades long awaited infrastructure Bill.  It should be VERY BIG & BOLD. Two Trillion Dollars, and be focused solely on jobs and rebuilding the once great infrastructure of our Country! Phase 4.”

“I love Michigan, one of the reasons we are doing such a GREAT job for them during this horrible Pandemic.  Yet your Governor, Gretchen ‘Half’ Whitmer is way in over her head, she doesn’t have a clue.  Likes blaming everyone for her own ineptitude! #MAGA”

“Because the ‘Ratings’ of my News Conferences etc. are so high, ‘Bachelor finale, Monday Night Football type numbers’ according to the @nytimes, the Lamestream Media is going CRAZY.  ‘Trump is reaching too many people, we must stop him,’ said one lunatic. See you at 5:00 P.M.!”

“The Lamestream Media wants us to fail.  That will NEVER happen!”

Wall Street

The number of Americans seeking unemployment benefits hit a record high for the second week in a row, a sickening/tragic 6.648 million, after last week’s 3.28 million.  Prior to this, the record during the financial crisis was 695,000.  That sums it up.

We then had the jobs report for March today and it reflected a loss of 701,000, far worse than expected as it was felt it would take the Labor Department until April’s report to reflect the true early damage from the economy hitting a brick wall.  The leisure and hospitality sector lost 459,000.  The monthly job loss was the first in over nine years, Oct. 2010.

The unemployment rate rose from 3.5% to 4.4%, and of course is headed much higher.

There isn’t a single person on Wall Street who has any idea just how awful the jobs picture and growth will end up being.  But Goldman Sachs is saying GDP will fall 9% in the first quarter and 34% in the second, with unemployment rising to 15% by mid-year.  It then sees a rebound in GDP of 19% in the third quarter, with a recovery starting in May/June.

Morgan Stanley is calling for second quarter growth to plummet 38%, and it sees no return to near normal until end of 2021.

The Federal Reserve Bank of St. Louis projects that the unemployment rate will skyrocket to 32% by mid-year, the Great Depression peak being 25%.

Dallas Fed President Robert Kaplan said the jobless rate will leap into the low- or mid-teens, before falling to around 8% by year’s end.  There are a ton of people in this country who would accept that outcome.

Boston Federal Reserve President Eric Rosengren is concerned with the impact of the pandemic on real estate and office building prices, with many from all sides headed towards default.

“When we come back the question is whether we need the same amount of office space because we found work at home may be more effective.”

Rosengren, who in recent years has warned of the flipside of historically low Fed interest rates, encouraging unhealthy levels of borrowing, which such an overhang of debt could worsen the recession to come and slow the recovery from it, adding he expected banks will see more commercial real estate borrowers fall behind on payments.

There were some economic releases aside from the jobs numbers, with our first PMIs on manufacturing and services for March, all coming in better than expected, and all deceiving.

The closely followed Chicago purchasing managers index was 47.8 (50 being the dividing line between growth and contraction), when 39 was expected, but we’ll get there, and then some.

The national ISM reading for manufacturing was 49.1 vs. a prior reading for February of 50.1.  The non-manufacturing, service sector figure was 52.5, much better than an expected 45, but when you dig down, you see the supplier deliveries component was 62.1, which in a perverse way is all about shortages, not the traditional way of looking at such a reading equating to stronger demand.

The figures for all three next month will be quite different.

February construction spending was -1.3%, factory orders unchanged in the month.

The Atlanta Fed’s GDPNow barometer for the first quarter is down to 1.3%, but as they warn, it is totally empirically based and these days it doesn’t as yet reflect reality.

Peter S. Goodman / New York Times

“The world is almost certainly ensnared in a devastating recession delivered by the coronavirus pandemic.

“Now, fears are growing that the downturn could be far more punishing and long lasting than initially feared – potentially enduring into next year, and even beyond – as governments intensify restrictions on business to halt the spread of the pandemic, and as fear of the virus reconfigures the very concept of public space, impeding consumer-led economic growth.

“The pandemic is above all a public health emergency.  So long as human interaction remains dangerous, business cannot responsibly return to normal.  And what was normal before may not be anymore.  People may be less inclined to jam into crowded restaurants and concert halls even after the virus is contained.

“The abrupt halt of commercial activity threatens to impose economic pain so profound and enduring in every region of the world at once that recovery could take years.  The losses to companies, many already saturated with debt, risk triggering a financial crisis of cataclysmic proportions.

“ ‘I feel like the 2008 financial crisis was just a dry run for this,’ said Kenneth S. Rogoff, a Harvard economist and co-author of a history of financial crises, ‘This Time Is Different: Eight Centuries of Financial Folly.’

“ ‘This is already shaping up as the deepest dive on record for the global economy for over 100 years,’ he said.  ‘Everything depends on how long it lasts, but if this goes on for a long time, it’s certainly going to be the mother of all financial crises.’

“The situation looks uniquely dire in developing countries, which have seen investment rush for the exits this year, sending currencies plummeting, forcing people to pay more for imported food and fuel, and threatening governments with insolvency – all of this while the pandemic itself threatens to overwhelm inadequate medical systems.

“Among investors, a hopeful scenario holds currency: The recession will be painful but short-lived, giving way to a robust recovery this year.  The global economy is in a temporary deep freeze, the logic goes.  Once the virus is contained, enabling people to return to offices and shopping malls, life will snap back to normal.  Jets will fill with families going on merely deferred vacations.  Factories will resume, fulfilling saved up orders.

“But even after the virus is tamed – and no one really knows when that will be – the world that emerges is likely to be choked with trouble, challenging the recovery.  Mass joblessness exacts societal costs.   Widespread bankruptcy could leave industry in a weakened state, depleted of investment and innovation….

“ ‘The psychology won’t just bounce back,’ said Charles Dumas, chief economist at TS Lombard, an investment research firm in London.  ‘People have had a real shock.  The recovery will be slow, and certain behavior patterns are going to change, if not forever at least for a long while.’”

It’s grim…it’s also just reality.  Peter Goodman goes on and on, raising issues like the $2.7 trillion in debt developing countries are on the hook for.

Or the following from Randall W. Forsyth / Barron’s:

“But once the pandemic recedes, significant, longer-term effects might be apparent. And they aren’t likely to be positive.

“Wartime finances that balloon budget deficits and that are covered by money-printing have proved inflationary throughout history.

“At the same time, globalization – already in retreat in the trade wars – will be curtailed further, as supply chains are relocated to avoid crossing borders, rather than to maximize comparative advantage.  That will raise the cost of internationally traded goods at a time when prices of services already are moving higher.

“While the coronavirus pandemic might seem to be an odd time to be thinking about inflation, writes Julian Brigden of Macro Intelligence 2 Partners, he sees the crisis accelerating the ‘generational inflection point’ in macroeconomics.  ‘But we are now entering an era of monetarily financed fiscal policy, just as the trend to de-globalization accelerates. This is going to be very inflationary,’ he writes.”

Europe and Asia

The data from the eurozone (EA19) on the PMI side was atrocious for March as expected.

The final eurozone composite index was 29.7 vs. February’s 51.6.  The reading was even below last week’s flash estimate of 31.4.  Manufacturing came in at 44.5, services 26.4.

Germany 45.4 mfg., 31.7 services
France 43.2, 27.4
Italy 40.3, 17.4…yes, 17.4
Spain 45.7, 23.0
Ireland 45.1, 32.5

Netherlands 50.5 mfg.
Greece 42.5 mfg., down from 56.2

UK 47.8, 34.5

Chris Williamson, chief economist, IHS Markit:

“With various countries stepping up their measures to contain the spread of the coronavirus, it’s no surprise to see the final PMI for March indicated an even steeper deterioration of business activity than the prior record decline signaled by the provisional ‘flash’ estimate. The data indicate that the eurozone economy is already contracting at an annualized rate approaching 10%, with worse inevitably to come in the near future.

“The service sector is currently seeing an especially severe impact from the Covid-19 outbreak, with travel, tourism, restaurants and other leisure activities all hit hard by virus containment measures.

“No countries are escaping the severe downturn in business activity, but the especially steep decline in Italy’s service sector PMI to just 17.4 likely gives a taste of things to come for other countries as closures and lockdowns become more prevalent and more strictly enforced in coming months.

“While employment is not yet falling as fast as seen during the financial crisis, the coming months will no doubt see jobless numbers rise sharply, even as governments across the eurozone seek to limit these.  However, the ultimate economic cost of the Covid-19 outbreak cannot be accurately estimated until we get more clarity on the duration and scale of the pandemic.”

Separately, Eurostat had a number of releases for the EA19.

The February unemployment rate in the eurozone was 7.3% vs. 7.8% in Feb. 2019, the lowest rate since March 2008.

Germany 3.2% France 8.1%, Italy 9.7%, Spain 13.6%, Netherlands 2.9%, Ireland 4.8%.

But from here on this metric is going to get ugly.

Retail sales in February increased by 0.9% in the euro area vs. January, up 3.0% year-over-year.

A flash estimate on EA19 inflation in March was 0.7%, 1.2% ex-food and energy.

--One other item.  Some crisis measures and emergency powers put in place amid the pandemic could be threatening democracy and human rights, 13 EU states warned in a joint statement issued Wednesday.

“We are deeply concerned about the risk of violations of the principles of rule of law, democracy and fundamental rights arising from the adoption of certain emergency measures,” the statement issued by the Dutch Foreign Ministry on behalf of the group says.

“Emergency measures should be limited to what is strictly necessary, should be proportionate and temporary in nature, subject to regular scrutiny, and respect the aforementioned principles and international law obligations,” it says.

The statement was clearly aimed at Hungary, whose autocratic prime minister, Viktor Orban, was allowed by parliament to rule by decree without a set time limit.

Under the new law, individuals publishing what is viewed to be fake news or distorted facts face several years in jail.

Turning to Asia…in China, the official government PMI readings for March showed a rebound over February in manufacturing, 52.0 vs. 35.7, and in services, 52.3 vs. 29.6, according to the National Bureau of Statistics.  But this is highly deceiving, especially on the manufacturing side as global demand dries up (save for PPE and toys!).

The private Caixin readings, which measure small- and medium-sized businesses, had manufacturing rebounding to 50.1 vs. 40.3, and services 43.0 vs. 26.5. 

Reminder, the service sector is now 60% of China’s economy.

Analysts from Societe Generale said in a note on Thursday: “There are signs of lasting damage to domestic demand, and on top of that the external shock resulting from widespread lockdowns in other major economies is arriving fast and furious.”

Here’s a telling factoid.  A total of 495 cinemas, or 4.4 percent of China’s total, had opened by Tuesday a week ago, government data showed, but they attracted just two people per cinema per day.  Days later, they were ordered to shut again as the government looked to contain a potential second wave of coronavirus infections in the country.

Japan’s manufacturing PMI came in at 44.8 for March, while the service sector reading was a putrid 33.8.

And then we had the announcement the Tokyo Olympics were being postponed to next year, which is going to be incredibly costly at the worst time possible.  Plus, in the days since the decision was made, Japan announced a significant uptick in coronavirus cases.  Last Sunday, Tokyo alone reported a single day high of 68.  Critics say that it is no coincidence that Japan did not voice alarm over Covid-19 until it had given up hope of staging the Games.  The containment policy has been limited and Japan may now pay a steep price.

South Korea’s manufacturing PMI was 44.2 last month, while Taiwan’s was up to 50.4.

Lastly, Hong Kong’s retail sales fell by a record 44% in February from a year earlier, as travel restrictions kept tourists away and residents avoided shopping centers to prevent the spread of the virus.

Street Bytes

--Stocks resumed their downtrend after the prior week’s record gains, the Dow Jones falling 2.7% to 21052, the S&P 500 2.1% and Nasdaq 1.7%.  The small-cap Russell 2000 plunged 7.1% and is now down 37% for the year.

Tuesday marked the end of a bloody first quarter, the Dow’s worst quarter since 1987, down 23%, while the S&P had its worst quarter since 2008 and worst first quarter ever.  Nasdaq fell 14%.

First-quarter earnings will begin to come out next week and a rough estimate for the S&P 500 is for them to have fallen about 10%.

--U.S. Treasury Yields

6-mo. -0.13%  2-yr. 0.23%  10-yr. 0.59%  30-yr. 1.21%

The yield on the 10-year is at an all-time weekly closing low.

--President Trump said he was inviting U.S. oil executives to the White House today to discuss ways to help a sector “ravaged” by slumping energy demand that has more than collapsed.  It’s basically non-existent. 

Monday, Trump said Saudi Arabia and Russia “both went crazy” over oil prices.  “We don’t want to have a dead industry that’s wiped out,” the president said in an interview with Fox News. 

Oil traded below $20 briefly on Monday, its lowest level since February 2002.

Trump then said he had very “good calls” with Vladimir Putin and the Crown Prince, and tweeted yesterday:

“Just spoke to my friend MBS (Crown Prince) of Saudi Arabia, who spoke with President Putin of Russia, & I expect & hope that they will be cutting back approximately 10 Million Barrels, and maybe substantially more which, if it happens, will be GREAT for the oil & gas industry!

“….Could be as high as 15 Million Barrels.  Good (GREAT) news for everyone!”

But, again, there is zero demand, and the world is flooded with crude; at least 20 million barrels per day oversupplied, currently, and the lost demand could be as high as 35 million bpd.

U.S. oil supplies, for example, surged last week, with inventories increasing by 13.8 million barrels in the week ended March 27 to 469.2 million barrels, the Energy Information Administration said.  A week earlier, stockpiles rose by 1.6 million barrels.

Storage facilities are topped out.

And there are zero details as to how any deal to drastically cut supply would be implemented.

Late this afternoon at the president’s daily press briefing we then learned that his meeting with oil executives was worthless, and Trump conceded both Russia and Saudi Arabia had made no commitments to significantly reduce production.  OPEC is going to be demanding anyway that any production cuts they agree to must be matched by U.S. companies.

Oil spiked to $29 with a huge rally the last two days on Trump’s tweets, but it should collapse all over again next week.

An emergency meeting of OPEC+ members is being held Monday.

Wednesday morning, shale producer Whiting Petroleum Corp. filed for Chapter 11 bankruptcy; the first major casualty from the free fall in the price of crude. 

Whiting, once the largest oil producer in North Dakota’s Bakken region, has seen its market capitalization shrink to below $40 million from as much as $15 billion at its peak in 2011, when investors were first discovering the burgeoning shale sector.

The company is working on a major restructuring where it gives up 97% of its equity to creditors in exchange for a large reduction of its debt.

Separately, the U.S. oil rig count slumped by 62 to 562 over the week ended April 3 to the lowest level since January 2017, per Baker Hughes.

--The president is trying to shore up the oil market, while at the same time saying on Wednesday that he was looking at whether to ground some domestic air travel between cities that are coronavirus hot spots.

Separately, over the past two weeks at least 25 FAA air-traffic control facilities across the U.S. have been disrupted or temporarily shut down for antivirus cleaning.

--Department store operators Macy’s Inc. and Kohl’s Corp. were among those on Monday announcing they were furloughing thousands of employees as their stores remain shut.  Some 130,000 are impacted at Macy’s.  Kohl’s will furlough about 85,000 of 122,000.

Kohl’s CEO Michelle Gass said, “Given these extraordinary circumstances, we are taking difficult and decisive actions to strengthen our financial liquidity.”  Gass said she would not take a salary.  The company also said furloughed employees would continue to get health benefits.

Macy’s said employees enrolled in health benefits will receive coverage, at least through May.

Gap, which also owns Old Navy and Banana Republic, said it would furlough nearly 80,000 store employees in the U.S. and Canada.

L Brands, which owns Victoria’s Secret and Bath & Body Works said it would furlough most store staff, those not currently working to support the online businesses, on April 5 for six weeks.  L Brands has 94,400 employees, according to the company’s most recent annual filling.

--Boeing Co. is expected to begin offering early retirement and buyout packages as it comes to grips with the deepening toll the pandemic has wreaked on the aviation industry.  The company had previously announced a freeze on hiring and no overtime in order to preserve cash.

Boeing customers and some of its suppliers, on the other hand, are announcing layoffs.

CEO David Calhoun said he wants to prepare for when the crisis abates.  “I have to keep my workforce in place and we have got to be ready when the recovery comes.”

Boeing sought at least $60 billion in government aid for itself, its suppliers and the broader aerospace sector.

--British Airways announced it will “suspend” around 36,000 staff after grounding much  of its fleet.  BA has had to negotiate with the unions to reach an agreement where up to 80% of cabin crew, ground staff, engineers and executives will have their jobs suspended, but no staff is officially being laid off.  They just won’t be paid, though the UK government is offering some wages through its job retention scheme, which covers 80% of someone’s salary capped at a certain level.

--Some 4,700 jets have been parked globally as airlines slash operations due to travel restrictions, with American Airlines saying it is set to sharply increase the number of jets is it planning to retire, including the retirement of 76 Boeing 737s it acquired between 1999 and 2001, along with 34 Boeing 757s and 17 Boeing 767s it previously announced it was permanently retiring.  Eventually the new 737 MAX jets will arrive, allowing the company to help facilitate the retirement of older jets that are in need of heavy maintenance.

American then said late Thursday it will suspend more than 60% of international capacity for the peak summer travel season.  The carrier will cut Pacific flights by 80%, Atlantic flights by 65%, and Latin American flights by 48%.

--EasyJet, one of Europe’s largest airlines, said it would ground its entire fleet as demand collapses in the face of government restrictions on travel.

--As you might imagine, first-quarter and March auto sales in the U.S. were miserable and will only get far worse.  General Motors vehicle deliveries dropped 7.1% in the first quarter of the year, Fiat Chrysler’s fell 10%, and Ford’s declined 4%.

Hyundai reported its U.S. sales fell 43% in March.  Toyota said its sales were down nearly 37% in March and 8.8% for the quarter.  Nissan reported a 27% drop in first-quarter sales.

With auto showrooms shut during the pandemic, Fiat Chrysler and General Motors moved to reboot with seven-year, no-interest loans and programs allowing customers to buy vehicles online.  Fiat Chrysler’s “Drive Forward” marketing program includes online shopping tools that will for the first time allow U.S. customers to complete the purchase of a vehicle through an FCA dealer.

Meanwhile, Ford announced it was delaying the reopening of its major production factories in North America as a rise in Covid-19 infections continues to pose a threat to the health and wellbeing of its employees.  Ford had been looking to restart some operations April 6 and April 14 but those plans have been pulled back.

Then today it said most of its vehicle and engine production facilities in Europe will remain closed until May 4.

--Volkswagen AG took the unprecedented step of halting output on both sides of the Atlantic, a move costing the world’s largest automaker $2.2 billion per week.  CEO Herbert Diess said decisive action is critical to overcome the coronavirus pandemic.

--Walt Disney Co. on Thursday said it would begin to furlough employees “whose jobs aren’t necessary at this time” amid widespread business closures, in the latest sign of the harsh economic fallout from global coronavirus crisis.

The pandemic has shuttered Disney’s theme parks, cruise lines and retail stores, halted film and TV productions and delayed high-profile movie releases including “Mulan.”

Disney, which employs 223,000 people according to its annual report, did not say how many people would be out of work because of the decision.

--Visa said cardholders’ spending has fallen 4% in the U.S., while customers’ overseas spending has declined 19%.  In a regulatory filing, Visa said, “As countries have imposed social distancing, shelter-in-place or total lock-down orders, domestic spending, most notably in travel, restaurants, entertainment and fuel, has sharply declined.”

--Supermarket chain Kroger saw its shares move sharply higher after the company reported a 30% surge in March comparable sales, owing to panic buying of food and essentials.  Kroger maintained its annual outlook while raising wages for all hourly frontline grocery, supply chain, manufacturing, pharmacy and call center staff by $2 an hour until April 18.

--Conagra Brands Inc said it is adjusting its supply chain to meet a surge in demand for its food as more people are staying home.  Sales ballooned in March, up 50% for the four weeks ending March 22, more than making up for falling demand from restaurants that buy its food.

Conagra, makers of items such as Healthy Choice frozen meals and Chef Boyardee pastas, said it is operating its factories at near capacity.

--Huawei released its 2019 Annual Report this week, detailing a solid business performance.  The company’s global sales revenue rose 19.1% for the year, with net profit at $8.9 billion, up 5.6%, though its weakest growth in three years. 

Huawei dominates the smartphone market in China with a 38.5% market share in 2019.

[The company only has a formal annual report and then updates each quarter that are not fully audited.]

But Huawei warned on Tuesday that 2020 would be its most difficult year yet due to American trade restrictions which dealt a blow to its overseas sales in 2019 and predicted the Chinese government would retaliate against the United States. The world’s largest maker of telecom equipment maker said Beijing could hit back against U.S. measures to restrict chip sales in Huawei, by restricting sales of American products in China and by shifting to alternative suppliers in China and South Korea.

“The Chinese government will not just stand by and watch Huawei be slaughtered on the chopping board,” Chairman Eric Xu told reporters.  “Why wouldn’t the Chinese government ban the use of 5G chips or 5G chip-powered base stations, smartphones and other smart devices provided by American companies, for cybersecurity reasons?”

The United States alleges the Chinese government could use Huawei’s equipment to spy, an accusation rejected by the company.  The Trump administration placed Huawei on a blacklist in May last year, citing national security concerns.

--Home Depot ordered all 2,300 stores in North America to stop sales of N95 masks to try to free them up for healthcare workers and other first responders during the crisis.  This comes after President Trump said the government’s stockpile of personal protective equipment had nearly been depleted by the states.

During an appearance on CNBC last week, the aforementioned Mike Roman of 3M, which makes N95 masks, expressed concern over some retailers continuing to sell protective gear.

“It’s disappointing when you see that, because we’re trying to redirect everything to health care workers,” he said.

--Bank of New York Mellon Corp. named Todd Gibbons as CEO, removing the interim tag he has carried the past six months after then-CEO Charles Scharf resigned to become president and CEO of Wells Fargo & Co.

Gibbons had been a longtime CFO at BNY.  He’s also a major reason why I went to Wake Forest.  We were friends at Summit High School, Todd a year ahead of me, and then when he was a freshman at Wake he treated me royally on my visit to the school for my interview.   He was later my ‘big brother’ in the fraternity I joined.

So congratulations, Todd. 

--Zoom, the wildly popular videoconferencing app, has come under fresh high-level scrutiny as its popularity soars during the coronavirus pandemic.

Zoom is now being used by millions of people for work and leisure, as lockdowns are imposed around the world, but its data security and privacy measures have been questioned.

New York Attorney General pointed out in a letter to the company that it has been slow to address issues.

Zoom has had security flaws in the past, including a vulnerability which allowed an attacker to remove attendees from meetings, spoof messages from users and hijack share screens.

--Canada’s manufacturing PMI for March was down to 46.1, in contraction mode like everyone else.

--The 56-year-old CFO of investment bank Jefferies, Peg Broadbent, died of coronavirus.  Peg, short for Peregrine, was a UK native who worked in the firm’s New York office.  He had been CFO at Jefferies since 2007.

--Luckin Coffee Inc., an upstart Chinese rival to Starbucks that touted itself as the country’s largest coffee chain by stores, said several employees fabricated much of its reported sales in 2019, the year the company went public on Nasdaq.

An internal investigation into the Xiamen-based company on Thursday said its chief operating officer and several others fabricated transactions amounting to $310 million from the second quarter to the fourth quarter of last year.

The news knocked 75% off the share value.

--SeaWorld Entertainment announced it will furlough more than 90% of its current employees as of April 1 as its parks remain closed.

--Shut-in television viewers tuned in to the game show “Let’s Make a Deal” in record numbers last week, registering its most-watched week since the show was brought back 11 years ago with Wayne Brady as host, the Nielsen company said.

“The Price is Right,” now hosted by Drew Carey, had its biggest audience in four years.

And it was also a terrific week for television uber-producer Dick Wolf, whose Windy City-based trilogy of dramas dominates NBC’s lineup.  “Chicago Fire” saw its biggest audience in six years, while “Chicago Med” and “Chicago PD” had their largest audiences in four years.

Also having their highest ratings ever were relatively new shows “FBI” and “FBI: Most Wanted” on CBS.

CBS was the most popular network in prime time, averaging 6.3 million viewers and led by the best ratings for “NCIS” this year.  NBC had 4.72 million viewers in prime time, ABC 4.66 million, and Fox 3.4 million.

Fox News Channel averaged 4.23 million viewers in prime time in the cable wars, followed by MSNBC at 2.32 million, and CNN 2.19 million.

ABC’s “World News Tonight” led the evening newscasts with an average of 11.9 million, with NBC’s “Nightly News” at 11 million and the “CBS Evening News” 7.4 million.

Among the week’s top 20 shows in prime time, “60 Minutes” was third, behind “FBI” and “NCIS.”

--Fox Business host Trish Regan is leaving the network following comments she made on her show earlier in March that some people took to suggest the risk from coronavirus was being overstated for political reasons.

On her show, Regan said Democrats and the “liberal media” were using the virus to “destroy the president.”  She also blamed stock market declines on Trump’s rivals, calling it “another attempt to impeach the president.”

I always found Ms. Regan to be highly unlikable.

--According to Nielsen sales of alcoholic beverages rose 55% in the week ending March 21.

Liquor sales were up 75% over the same period in 2019.  Wine sales were up 66% and beer sales were up 42%.  I contributed heroically to the latter.

Foreign Affairs

Iran: President Trump on Wednesday warned Iran and its proxies against attacking U.S. troops or assets in Iraq, citing a possible “sneak attack” but giving no other details.  Trump tweeted:

“Upon information and belief, Iran or its proxies are planning a sneak attack on U.S. troops and/or assets in Iraq.  If this happens, Iran will pay a very heavy price, indeed!”

A top military aide to Iran’s Supreme Leader Ayatollah Ali Khamenei cautioned the United States hours before of consequences of “provocative actions” in Iraq, Iranian news agencies reported.  “We advise U.S. politicians and military to take responsibility for the consequences of their provocative actions (in Iraq),” General Yahya Rahim Safavi said.  “Any U.S. action will mark an even larger strategic failure in the current president’s record.”

Separately, the United States now believes Iran’s Ministry of Intelligence and Security was directly involved in the killing of an Iranian dissident last November in Turkey.  Masoud Molavi Vardanjani was shot dead on an Istanbul street on Nov. 14, 2019. 

China: Regarding Beijing’s transparency as the coronavirus took hold, Vice President Mike Pence said on CNN Wednesday: “The reality is that we could have been better off if China had been more forthcoming.  What appears evident now is that long before the world learned in December that China was dealing with this, and maybe as much as a month earlier than that, that the outbreak was real in China.”

Nebraska Republican Sen. Ben Sasse said: “Without commenting on any classified information, this much is painfully obvious: The Chinese Communist Party has lied, is lying, and will continue to lie about coronavirus to protect the regime.”

North Korea: Pyongyang fired off two more short-range ballistic missiles on Sunday.  The enhanced bottle rockets flew 143 miles at a maximum altitude of 19 miles, according to South Korea’s Joint Chiefs of Staff.

These are the eighth and ninth missiles launched in four rounds of tests in March, the most ever in a single month by the North.

Russia: President Vladimir Putin, who just until two weeks ago was sloughing off the coronavirus danger, on Thursday prolonged until April 30 a paid non-working period across Russia.  Russia has reported over 4,000 cases with 34 deaths.

Putin delivered a televised speech to the nation, saying the partial lockdown and this week’s non-working period had helped slow the contagion, but that the latter needed to be extended.

For his part Putin is being monitored after a doctor he met last week tested positive for Covid-19.  The medic gave Putin a tour of Moscow’s main coronavirus hospital last week and neither of them was wearing protective equipment during their conversation, TV footage from the visit showed.

Brazil: As of Wednesday, just 35% of Brazilians called President Jair Bolsonaro’s handling of the coronavirus crisis “good” or “great,” according to a Datafolha survey.  I can guarantee this will decline much further.

But Bolsonaro has continued his stand-off with state governments by suggesting that democracy could be at risk if the coronavirus crisis leads to social chaos.  He has criticized governors in the hardest-hit Brazilian states, calling them “job-killers” for declaring lockdowns to limit the spread.

“When the situation is heading toward chaos, with mass unemployment and hunger, it’s fertile ground for some to exploit, seeking a way to reach power and never leave it,” Bolsonaro told reporters.  He has warned that Brazil could break with “democratic normalcy,” citing the risk of rioting and suggesting “the left” could capitalize on any chaos, without elaborating.

Last weekend in a television interview, Bolsonaro called coronavirus “a small cold” that would kill only old people.  “I’m sorry, some people will die, they will die, that’s life,” as he encouraged Brazilians to get out and work rather than isolating themselves.

The death toll is 343 as of today.

Meanwhile, Health Minister Luiz Henrique Mandetta has seen his support rise as he gives technocratic daily briefings presenting the latest science, stressing the need for social distancing measures that Bolsonaro stupidly ignored.  In cabinet meetings, Mandetta has reinforced his opposition to public gatherings.

A popular Brazilian rapper MV Bill added his voice to the criticism of Bolsonaro as he warned that contagion could be explosive in Brazil’s crowded “favelas” or slums, such as Rio’s City of God where he was born, some with no running water.

Pakistan: Editorial / New York Post

“While the rest of the world deals with the Covid-19 pandemic, Pakistan is busy letting murderers go free.

“On Thursday, a Pakistani local court overturned the conviction of a British-Pakistani man for orchestrating the kidnapping and beheading of Wall Street Journal reporter Danny Pearl in 2002.

“A full 18 years after the fact, the court found Ahmed Omar Saeed Sheik guilty of the lesser charge of kidnapping and sentenced him to seven years in prison.  He’ll likely get out for time already served.

“With much of Pakistan sympathetic to violent Islamists, the move reeks of corruption.  Tellingly, the court also overturned the convictions of three other men who had been serving life sentences in the case.

“On Jan. 23, 2002, Saeed lured Danny Pearl into a trap in Karachi with a promise of info for his investigation of ‘shoebomber’ Richard Reid’s links to militants there.  Days later, al Qaeda 9/11 mastermind Khalid Sheik Mohammed videotaped his gruesome murder of the reporter.

“As Pearl’s father, Judea, said, ‘It’s a mockery of justice.’  He continues: ‘Anyone with a minimal sense of right and wrong now expects Faiz Shah, prosecutor general of [the Pakistani province] Sindh to do his duty and appeal this reprehensible decision to the Supreme Court of Pakistan.”

“Saeed & Co. should rot behind bars until their own Judgment Day.”

This is a scary story on so many levels, that the Pakistani government would allow this ruling to be made.  It leads one to renewed concern over the security of its nuclear weapons.

Random Musings

--Presidential tracking polls….

Gallup: 49% approval of President Trump’s job performance, 45% disapproval; 92% of Republicans approve, 43% of independents (March 13-22).
Rasmussen:  44% approve, 53% disapprove (April 3).

--In a new CNN poll conducted by SSRS, 48% of Americans say that the government has done a good job in preventing the spread of coronavirus, with 47% saying the government has done a poor job, an increase of four points in about three weeks.

77% of Republicans say the federal government is doing a good job preventing the virus’ spread vs. 27% of Democrats.

The CNN Poll was a random national sampling of 1,013 adults.

A new Washington Post/ABC News poll found Trump’s approval rating for handling the economy has hit the highest point yet during his three-plus years in office, with 57 percent of Americans approving – up five points since February – and 38 percent disapproving.  Needless to say, this is about to change drastically.

--The Democratic National Committee announced it was postponing the party’s convention from mid-July to the week of Aug. 17.  The move came hours after Joe Biden said he thinks his party’s nominating convention will have to be pushed back into August because of the coronavirus threat.

Of course who the heck knows where we will be by even June, let alone August.

And as for Bernie Sanders, he still hasn’t given an indication of when or how he might end his candidacy.

--House Speaker Nancy Pelosi said she wants to virus-proof the November election by including funding to boost voting by mail in the next pandemic response plan being put together by Democrats in the House of Representatives. 

I totally agree with this.  Here in New Jersey I’ve been voting by absentee ballot for years.  We need to plan today that the virus is probably back in the fall and regardless of the optimism we’ll have a much better handle on things then, we certainly don’t want our elderly feeling compelled to vote in person.

President Trump has said voting by mail would hurt the Republican Party.  Pelosi rejected that argument.  “When I was chair of the California Democratic party many years ago, the Republicans always prevailed in the absentee ballots.”

Indeed, some Democrats fear voting by mail could impact minorities and low-income voters who either move frequently or lack reliable access to mail service.

Today, when asked about Pelosi’s proposal, President Trump said there will be “no mail-in voting” as he pushed the idea of voter ID.  He said absentee balloting is subject to too much “cheating.”

This is going to be a massive issue by the summer if the pandemic hasn’t just drifted away…cough cough.

--North Carolina Republican Sen. Richard Burr is facing two potential investigations, one by the Justice Department, the other from the Securities and Exchange Commission, into his stock sales a week before the market began to collapse related to the coronavirus.

CNN reported the investigations may involve an additional five U.S. senators who also conducted stock sales before Feb. 20, including Georgia Senators Kelly Loeffler and David Perdue, Oklahoma’s Jim Inhofe, Wisconsin’s Ron Johnson and California Sen. Dianne Feinstein.

Burr has requested the Senate Ethics committee investigate his stock transactions.  He claims he was acting on public information and not just a Jan. 24 Senate briefing on the coronavirus that included Dr. Fauci.

--A skeleton crew is going to man critical stations while the USS Theodore Roosevelt is disinfected pierside in Guam, Acting Navy Secretary Thomas Modly said in an interview on Tuesday.

The majority of the crew is being removed after its commanding officer sent an urgent message asking for help controlling a Covid-19 outbreak.

“The key is to make sure that we can get a set of crew members that can man all those critical functions on the ship, make sure they’re clean, then get them back on while we clean the ship and get the other crew members off,” Modly said.

The 1,100-foot Theodore Roosevelt tied up in Guam after several sailors were discovered to be infected.  On Monday, Capt. Brett Crozier sent an extraordinary four-page letter asking for Navy help.  His warship has no space to give infected patients a separate berthing space and bathroom, so he asked for help ashore.

“The spread of the disease is ongoing and accelerating,” Crozier wrote in the March 30 letter.  “Decisive action is required.”

Crozier recommended isolating or quarantining 4,000 sailors for two weeks to ensure that no one carries the virus back aboard.  Meanwhile, about 10% of the crew would be needed to run the ship in port and disinfect it, he wrote.

“We are not at war.  Sailors do not need to die.  If we do not act now, we are failing to properly take care of our most trusted asset – our Sailors.”

“Keeping over 4,000 young men and women on board the TR is an unnecessary risk and breaks faith with those Sailors entrusted to our care,” the captain added.

So Thursday, Capt. Crozier was relieved of command.

Crozier “demonstrated extremely poor judgement in the midst of a crisis” by sending his four-page request for urgent help to people outside his chain of command, including a newspaper.

Acting Sec. Modly said Crozier could have “walked down the hall” to his immediate boss, the admiral in charge of the carrier’s strike group, or expressed his concerns in one of his conversations with Modly’s chief of staff.

Modly denied that the letter and its intense media coverage spurred the Navy into quicker action that was not already happening.  And he denied that Crozier’s firing was “retribution,” praising the captain for looking out for his crew and sounding alarms.

Former Vice President Joe Biden said in a statement that “the Navy sent a chilling message to the rest of the fleet about speaking truth to power.  The poor judgment here belongs to the Trump Administration, not a courageous officer trying to protect his sailors.”

Crozier was cheered wildly by his crew as he left the ship today.

Separately, the first U.S. military service member, a New Jersey Army National Guardsman, died last Saturday from Covid-19.

--One of my favorite senators of all time, Dr. Tom Coburn of Oklahoma, passed away.  An ultraconservative fiscal hawk, he knew his stuff, and wasn’t afraid to call out ignorant colleagues.  For this he drew scorn from both sides of the political aisle.

On many policy points Coburn was too far right for me, especially on some social issues, but in some respects he reminded me of Barry Goldwater.  Over time, in many respects Coburn is likely to be remembered more fondly than many in the country do today.

And, hell, he was friends with Barack Obama.  Coburn said of the future president, the two having arrived in the Senate together in 2005: “I think he’s a neat man.  You don’t have to be the same to be friends.  Matter of fact, the interesting friendships are the ones that are divergent.” 

Robert D. McFadden / New York Times

“A visceral foe of Washington long before such disaffections coalesced into the Tea Party, Mr. Coburn swept into Congress with the class of 1994, when Republicans gained control of the House for the first time in 40 years and installed Newt Gingrich as speaker and his ‘Contract With America’ agenda to shrink government, cut taxes and promote welfare reforms and business activity.

“Mr. Coburn soon set about displeasing everyone, including the constituencies most politicians covet: his own party’s activists, donors, leaders and congressional colleagues.  He battled with Mr. Gingrich often, charging that he was drifting to the political center and away from his contractual pledges to the nation.  He openly vented his disdain for career politicians.

“ ‘His contempt for them is genuine, bipartisan and in many cases mutual,’ The New York Times reported years later.  ‘He once prescribed a ‘spinal transplant’ for 70 percent of the Senate, and another time said his colleagues had ‘reproductive organs the size of BBs.’’”

Editorial / Wall Street Journal

“Politics is a lifetime career for most in American government, and then there are exceptions like Thomas Coburn.  The Oklahoma obstetrician who became a Senator and then returned to a productive private life died Saturday of prostate cancer at age 72.  He was what America’s Founders imagined in self-governing citizen legislators, and that mentality made him far more consequential than the usual congressional seat-fillers.

“Coburn worked in his family’s optical-lens firm before going to medical school and setting up an ob/gyn practice.  He ran for the House in 1994 in part to oppose the Clinton effort for government health care, served three terms and retired before running for Senate in 2004 for what he said would be no more than two terms.  He continued to see patients on weekends and Mondays in Oklahoma until the Senate declared it a (preposterous) conflict-of-interest.

“ ‘I don’t think Washington can fix Washington,’ Coburn told colleague Joe Rago in 2014 after announcing his retirement two years early when his cancer recurred.  ‘You’re always going to have this built-in conflict of getting re-elected.  Parochial interests will trump the best interests of the nation, and the actors will do what’s expedient to be popular. It doesn’t have to be that way.  There’s hundreds of thousands if not millions of people who could do these jobs well.  All it requires is common sense and courage.’

“Tom Coburn had both of those qualities, which he used to take on important causes that challenged both political parties.  He campaigned against parochial spending and waste, but unlike most Senators he did the homework on the details.  His investigation of fraud in the Social Security disability program was a model of Congressional oversight.

“Coburn challenged his own party on spending earmarks, making famous the ‘bridge to nowhere’ in Alaska that led to a broader earmark ban.  He took on special-interest tax subsidies and defeated the ethanol tax credit almost by himself.  He took a particular interest in health care and offered a roadmap for Republicans for free-market reform to reduce the tax subsidy for employer insurance that is skewed to the affluent; he wanted to use the savings to provide tax credits for lower-income workers whose bosses don’t offer insurance. The Trump Administration could do worse than campaign on a version of it this year.

“Many conviction politicians accomplish little because they care more about looking principled than advancing their principles.  Coburn was different because while firm in his convictions he was also pragmatic in forming alliances to get things done.   American politics would be healthier, and government would be less destructive, if we had more Tom Coburns.”

Amen.

From Joseph Rago’s interview with then-Sen. Coburn in the WSJ, Feb. 1, 2014.

“In 2000, Dr. Coburn kept his campaign promise to limit himself to three terms in the House and retired.  He returned in 2005, disgusted by the George W. Bush spending binge and especially the Medicare prescription-drug benefit.  He promptly made himself a senator non grata by exposing vanity-project spending like the $223 million ‘bridge to nowhere’ in Alaska.  Dr. Coburn suggested spending the money on a New Orleans bridge damaged by Hurricane Katrina.  Eight-two senators voted against him.

“His colleagues retaliated by trying to prevent Dr. Coburn from practicing medicine.  In the House, he was in the habit of flying home to Muskogee on weekends and seeing patients Monday mornings, and he was allowed by Senate rules to charge his patients enough to cover his expenses.  But in 2005, the Senate Ethics Committee ruled that the arrangement would be a conflict of interest.  ‘Somebody’s going to come to me for a Pap smear to influence my vote?’ he says.  ‘I mean, give me a break.’

“So Dr. Coburn offered his services free of charge.  Two years ago he stopped, when the yearly $40,000 to $80,000 payments for malpractice insurance became too much of a financial drain.

“Such affronts explain why Dr. Coburn is leaving the Senate…. ‘I know myself well enough to know my patience has worn thin, of continuing to push boulders up an ice flow,’ he says.”

--We note the passing of Rev. Joseph Lowery, 98, the “Dean” of the civil rights movement, the fiery Alabama preacher who was on the front line of the battle for equality.  For more than four decades after the death of his friend, the Rev. Martin Luther King Jr., Lowery carried the torch, with oratory steeped in scripture, refusing to back down whether the audience was a Jim Crow racist or a U.S. president.

At Barack Obama’s inaugural in 2009, Lowery gave the benediction: “We ask you to help us work for that day when black will not be asked to get in back; when brown can stick around; when yellow will be mellow; when the red man can get ahead, man; and when white  will embrace what is right.”

The King Center in Atlanta remembered Lowery in a tweet: “Tonight, the great Reverend Joseph E. Lowery transitioned from earth to eternity.  He was a champion for civil rights, a challenger of injustice, a dear friend to the King family.”

Lowery led the Southern Christian Leadership Conference for two decades, restoring the organization’s financial stability and pressuring businesses not to trade with South Africa’s apartheid-era regime.  He retired in 1997.

But then he lived to see the election of an African-American president.

In another high-profile moment, Lowery drew a standing ovation at the 2006 funeral of MLK’s widow, Coretta Scott King, when he criticized the war in Iraq, saying, “For war, billions more, but no more for the poor.”  President George Bush and his father, George H.W. Bush, were seated behind the pulpit.

The Rev. Joseph Lowery was a giant.  RIP.

--From the New York Times:

“Two weeks ago, amid the coronavirus pandemic, about 70 students from the University of Texas at Austin partied in Mexico on spring break.  The students, all in their 20s, flew on a chartered plane to Cabo San Lucas, and some returned on separate commercial flights to Texas.

“Now, 44 of them have tested positive for the virus and are self-isolating.”

The defiant attitude of spring breakers from schools all over the country was best embodied by Brady Sluder, a young man on spring break in Miami who declared from a packed beach: “If I get corona, I get corona.  At the end of the day, I’m not going to let it stop me from partying.”  He later apologized on Instagram.

“Generation Z” should be re-designated “Generation Idiot.”

--The Skagit Valley Chorale of Mount Vernon, Washington, debated whether to go ahead with a weekly rehearsal on March 6.  The coronavirus was already killing people in the Seattle area, about an hour’s drive to the south.

But Skagit County hadn’t reported any cases, schools and businesses remained open, and prohibitions on large gatherings had yet to be announced.

So the choir’s conductor informed the 121 members in an email that amid the “stress and strain of concerns about the virus,” practice would proceed as scheduled at the Mount Vernon Presbyterian Church.

Sixty singers showed up.  Hand sanitizer was offered at the door and there were no hugs and handshakes.  As they rehearsed they tried to keep some distance between each other.

Nearly three weeks later, 45 of the 60 have been diagnosed with Covid-19 or were ill with the symptoms.  At least three were hospitalized, and two are dead, per the Los Angeles Times earlier this week.

--Defying a state order banning gatherings of more than 50 people and a stay-at-home order issued on March 22, Louisiana Pentecostal preacher Tony Spell held a gathering of hundreds, leaping into the pews, parading, hugging and laying hands on worshipers’ foreheads in prayer.

“We’re free people.  We’re not going to be intimidated. We’re not going to cower,” Rev. Spell said from the pulpit of Life Tabernacle Church in a suburb of Baton Rouge.  “We’re not breaking any laws.”

You’re a bunch of f’n idiots.

--Larry David, the 72-year-old “Curb Your Enthusiasm” creator, was asked by California to produce a public service announcement urging all “idiots” in the state to sit at home and watch TV.

“I basically want to address the idiots out there, and you know who you are, you’re going out,” says David, “you’re socializing too close, it’s not good.”

“You’re hurting old people like me.  Well not me, I have nothing to do with you, I’ll never see you.”

David notes the state public health order aimed at curbing the spread of coronavirus has presented a golden opportunity to lounge on the couch and watch some television.

“I mean, I don’t know how you’re passing that up,” he says in the message, which the governor’s office tweeted out.

“Well, maybe because you’re not that bright,” David says.  “But here it is – go home!  Watch TV!  That’s my advice to you.”

---

Pray for the men and women of our armed forces…and all the fallen.

We pray for health care workers and all first responders who are putting themselves in harm’s way.

God bless America.

---

Gold $1648
Oil $29.00

Returns for the week 3/30-4/3

Dow Jones  -2.7%  [21052]
S&P 500  -2.1%  [2488]
S&P MidCap  -6.0%
Russell 2000  -7.1%
Nasdaq  -1.7%  [7373]

Returns for the period 1/1/20-4/3/20

Dow Jones  -26.2%
S&P 500  -23.0%
S&P MidCap  -35.2%
Russell 2000 -37.0%
Nasdaq  -17.8%

Bulls 31.4
Bears 36.3

Hang in there.  Wash your hands.

Brian Trumbore