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Kunstler: Impure Thoughts

Public Policy

What if the Corona virus turns out to be a genuine pandemic with legs, not some punk-ass, flash-in-the-pan bug like SARS… and infects hundreds of millions around the world…? And what if it happens to go logarithmic in the USA, as in China now…? And what if takes a few months, or half a year, to do that…? And what if Americans will not get on airplanes when that happens…? Or gather together in large numbers…? Or if government imposes quarantines …? Will the parties hold their nominating conventions? Might the November election have to be postponed?

Just sayin’… since nobody else seems to be talking about it. A few months ago, nobody was thinking about a disease that would virtually lock-down China’s economy, either… and now here we are. Speaking of which, that lock-down of China’s economy is already generating serious damage to global GDP, after only a few weeks. But nothing shows our detachment from reality like the recent surge in financial market indexes while the Chinese economy was busy shutting down. In particular, one must wonder: What supports the global daisy-chain of debt obligations while all this is going on?

After all, companies doing business need a revenue stream to service their revolving debts. They have to make stuff, and move stuff, and get paid for it. What happens when there is no revenue stream? The workings of this hyper-complex financial system depend utterly on the velocity of these revenue streams. They can’t just… stop! Everybody who follows these things understands that China’s banking system is 1) a hot mess of confabulated public and private lending relationships, 2) completely opaque as regards the true workings of its operations, and 3) shot through with fraud, swindling, and Ponzis. Did China’s ruling party just put its banking system in an induced coma while Corona virus plays out? How can that possibly not affect the rest of global finance, which is plenty janky, too?

The USA gets everything from car parts to pharmaceuticals from China. How long will it take for the manufacturing lock-down to show up in American daily life? What if it continues for some months going forward? You can easily draw your own conclusions.

Here’s another interesting angle on that: Corona virus might give President Donald Trump an easy out from being the bag-holder for a stock market crash and banking train wreck. The signal weakness of Mr. Trump’s term-in-office was his taking ownership of a magical mystery stock market that climbs ever-higher day after day, defying all known rules of physics as applied to money. This longest “expansion” in US history (if that’s what it was, and I’m not so sure about it) seems to have hit a speed bump last September when something broke in the short-term “re-po” lending markets, at which time (and ever since), Jay Powell’s Federal Reserve began jamming hundreds of billions of dollars into them to smash down zooming interest rates and prevent a heart attack in the system. That creation of “liquidity” — money from thin air — appears to have stabilized the situation. But then, it is a peculiar feature of our times that a lot of things have an appearance that doesn’t sync with reality.

In short, if Corona virus and its side-effects do substantially knock down the stock markets, Mr. Trump gets off scot-free on the one thing that has been really propping him up. Not only can he blame a looming market calamity on this black swan pandemic, he can then turn around and play the Franklin Roosevelt role in attempting to rescue the nation from a depression. And then, if the election has to be postponed, we will see a for-sure discontinuity in US political history, consequences as yet unknown.

Meanwhile, schemes continue apace to overthrow Mr. Trump by-hook-or-by-crook before the election, with Sedition Release 4.0 just breaking in the Roger Stone sentencing affair and four prosecutors (three of them Mueller alumni, imagine that!) staging a phony-baloney resignation huff to stir up useful idiots like Rep. Eric Swalwell on the House Intel Committee for the next go at impeachment. Understand, this wicked business is just another ploy engineered by the same combined Deep State / Lawfare scoundrels that ran RussiaGate, MuellerGate, and UkraineGate, and the real purpose of it is to stave off efforts to prosecute a pretty broad network of those same former and current officials in the FBI, DOJ, CIA, State Department, Pentagon, Obama White House, and the Clinton Foundation for seditious conspiracy and, yes, possibly even treason. Personally, I believe that the Attorney General is honestly trying to smoke out the truth in this morass of nefarious intrigues, and that neither attempts to block him by the perps and their allies, nor a visitation of Corona virus across the land, will thwart him.


173 Comments on "Kunstler: Impure Thoughts"

  1. Davy on Thu, 20th Feb 2020 7:41 am 

    “How does the new coronavirus compare with the flu?” live science

    “Typical flu symptoms include fever, cough, sore throat, muscle aches, headaches, runny or stuffy nose, fatigue and, sometimes, vomiting and diarrhea, according to the CDC. Flu symptoms often come on suddenly. Most people who get the flu will recover in less than two weeks. But in some people, the flu causes complications, including pneumonia. So far this flu season, about 1% of people in the United States have developed symptoms severe enough to be hospitalized, which is similar to the rate last season, according to data from the CDC. With COVID-19, doctors are still trying to understand the full picture of disease symptoms and severity. In a small study of about 100 people with the virus, published Jan. 30 in the journal The Lancet, the most common symptoms were fever, cough and shortness of breath. Only about 5% of patients in that study reported sore throat and runny nose, and only 1-2% reported diarrhea, nausea and vomiting. In a more recent study, considered the largest on COVID-19 cases to date, researchers from the Chinese Center for Disease Control and Protection, analyzed 44,672 confirmed cases in China between Dec. 31, 09 and Feb. 11, 2020. Of those cases, 80.9% (or 36,160 cases) were considered mild, 13.8% (6,168 cases) severe and 4.7% (2,087) critical. “Critical cases were those that exhibited respiratory failure, septic shock, and/or multiple organ dysfunction/failure,” the researchers wrote in the paper published in China CDC Weekly…So far this flu season, about 0.05% of people who caught the flu have died from the virus in the U.S., according to CDC data. The death rate for COVID-19 appears to be higher than that of the flu. In the study published Feb. 18 in the China CDC Weekly, researchers found a death rate from COVID-19 to be around 2.3% in mainland China. That’s much higher than the death rate linked to flu, which is typically around 0.1% in the U.S., according to The New York Times. Even so, the death rate for COVID-19 varied by location and an individual’s age, among other factors. For instance, in Hubei Province, the epicenter of the outbreak, the death rate reached 2.9%; in other provinces of China, that rate was just 0.4%. In addition, older adults have been hit the hardest. The death rate soars to 14.8% in those 80 and older; among those ages 70 to 79, the COVID-19 death rate in China seems to be about 8%; it’s 3.6% for those ages 60 to 69; 1.3% for 50 to 59; 0.4% for the age group 40 to 49; and just 0.2% for people ages 10 to 39. Nobody 9 and under has died of this coronavirus to date.”

  2. Abraham van Helsing on Thu, 20th Feb 2020 10:47 am 

    New information mortality Corona:

    Below 40 mortality is very low: 0.2%
    40-49 0.4%
    50-59 1.3%
    60-69 3.6%
    70-79 8.0%
    80-89 14.8%

    Males: 2.8%
    Females: 1.7%

  3. Duncan Idaho on Thu, 20th Feb 2020 10:53 am 

    Bloomberg Spent Hundreds of Millions to Get His Ass Kicked

  4. Abraham van Helsing on Thu, 20th Feb 2020 11:47 am 

    “Bernie Sanders is cruising towards the Democratic nomination. But can he win?”

  5. Abraham van Helsing on Thu, 20th Feb 2020 11:52 am 

    “Why Trump won the Democratic debate as Mike Bloomberg gets roughed up”

    “We’re winning. We’re winning like never before. Washington Democrats keep on losing their minds. They hate the fact that we’re winning,” Mr Trump said to another basketball arena-sized crowd of supporters. “We’re winning big. We’re winning, winning, winning.”

    His approval rating certainly suggests he is – despite the chaotic presidency, scandals, high-level ousters and firings, and even being impeached – the president is indeed winning his re-election bout.

    Though it’s still early in the 2020 cycle, poll numbers suggest, to borrow a version of a phrase coined by former First Lady Michelle Obama, when Democrats go low – on one another – Mr Trump’s poll numbers go high, meaning higher.

    Note, “The Independent” doesn’t like Trump.

  6. Duncan Idaho on Thu, 20th Feb 2020 11:57 am 

    But can he win?

    Even Hillary, a very weak candidate, got three million more votes than the Fat Boy.
    I think Bernie would bury the Fat Boy,
    (Assuming a fair election, which is highly unlikely with the Fat Boy in charge.)

  7. Abraham van Helsing on Thu, 20th Feb 2020 12:06 pm 

    Bloomberg and Epstein knew each other very well:

    “Democrat presidential candidate and former New York City mayor Michael Bloomberg was confronted recently in Providence, Rhode Island regarding Bloomberg’s appearance in late pedophile Jeffrey Epstein’s “little black book” of contacts, which was maintained by Epstein’s late butler.”

    Epstein was identified as a Mossad agent who blackmailed world leaders with underage sex traps by former high-ranking Israeli intelligence official Ari Ben-Menashe, who has staked his reputation on the claims.”

  8. Davy on Thu, 20th Feb 2020 12:17 pm 

    “China Injects A Record 5 Trillion Yuan In New Debt To Arrest Economic Crash” zero hedge

    “Putting it in context, the total credit injection of more than 5 trillion yuan, or roughly $725 billion, in one month, was the single biggest on record…The bottom line: even though the coronavirus may have given Beijing just the excuse it needs for a massive debt injection, there is now so much debt in China that it is unlikely that such piecemeal injections will have much of an impact.”

  9. JuanP on Thu, 20th Feb 2020 12:19 pm 

    (Assuming a fair election, which is highly unlikely with the Fat Boy in charge.)

    Duncan you forget that the Democrats stage a coup attempt before, during, and after the election. You probably need some derangement therapy to see these things

  10. joe on Thu, 20th Feb 2020 12:37 pm 

    If DONALD TRUMP can win anything then why not another megalomaniac billionaire former Republican. Quake in your boots America, here comes the time of your Crassus, Sulla, Pompei and Ceaser. Each one paying off the political elites and paying off the masses to fight against one another. Hmm Eisenhower warned you against this but you didn’t listen, now it’s too late. The west will soon follow. Without the monolithic communist bloc to prop up the west, it’s taken little less than a generation to fall into pointless decay and multikultr social exploitation of so called left v right……

  11. Davy on Thu, 20th Feb 2020 1:41 pm 

    “”Greater Idaho”: Conservatives In Oregon Want 22 Rural Counties To Secede And Become Part Of Idaho” zero hedge

    “Is the state of Idaho going to get a whole lot bigger? A group known as Greater Idaho is pushing for rural counties in Oregon and northern California to secede and become part of the state of Idaho. In fact, as you will see below, this effort has actually been endorsed by some of the top Republicans in the Oregon legislature. Today, the Oregon state government is completely and utterly dominated by the left, and due to the demographics of the state that is not likely to change any time soon. So conservatives in rural areas that are deeply upset over the direction of the state essentially have just two options. They can either move to a more conservative state, or they can attempt to redraw state lines. A similar scenario is playing out in Virginia. The Democrats have taken control of the state government, and the state continues to drift left with each passing year. Obviously many of those living in rural Virginia counties do not like this one bit, and the recent attacks on Second Amendment rights brought things to a boiling point. There has been a lot of talk that rural countries in Virginia could try to secede and join West Virginia, and West Virginia’s governor Jim Justice has publicly said that he would welcome those counties “with open arms”…”

    “Ultimately, this is yet another sign of how incredibly divided we have become as a nation. In recent years we have seen multitudes of conservatives move to “red states” and multitudes of liberals move to “blue states”, and that trend is likely to accelerate in the years ahead.”

    “It has gotten to the point where many of us literally do not even want to live in an area that is controlled by the other side, and the 2020 election is going to deepen our existing political divisions no matter who ends up winning.”

    Welcome to the ‘Divided States of America’.

  12. Suicide Watch on Thu, 20th Feb 2020 2:12 pm 

    We understand that juanPee is chronically depressed with suicidal thoughts. If anyone has his location please report them to Douglas Gardens Mental Health

  13. JuanP on Thu, 20th Feb 2020 2:14 pm 

    Chinese Regime Deploys 1,600 Online Trolls To Suppress Information On Coronavirus

    The propaganda department in virus-stricken Hubei Province has engaged over 1,600 censors to scrub the internet of “sensitive” information relating to the coronavirus outbreak, according to an internal document obtained by The Epoch Times.

    The internal report, dated Feb. 15, detailed the agency’s efforts to ramp up censorship measures. It was drafted after a speech given by Chinese leader Xi Jinping via video link on Feb. 10 to “frontline responders” of the coronavirus outbreak in Wuhan, the capital of Hubei, where the virus first broke out.

  14. JuanP on Thu, 20th Feb 2020 2:43 pm 

    I have to admit Mak and I were so wrong and Davy so right about this virus and China. I get agenda blind because I am so anti-American and pro-Chinese.

  15. Davy on Thu, 20th Feb 2020 2:58 pm 

    I have to admit, all this socking and ID theft is making me look like a complete idiot. I get reality blind because I am so anti-social and pro-dumbass.

  16. Davy on Thu, 20th Feb 2020 3:06 pm 

    “”Keenly Aware”- FDA Braces For Drug And Medical Supply Shortages From China ” zero hedge

    “The FDA warns, “we are keenly aware that the outbreak will likely impact the medical product supply chain, including potential disruptions to supply or shortages of critical medical products in the U.S.”

    “A shortage of medical products from China would be disastrous for America’s aging population and fragile economy.”

  17. Abraham van Helsing on Fri, 21st Feb 2020 4:20 am 

    “Donald Trump isn’t safe yet, but the economy is working well for him”

  18. Davy on Fri, 21st Feb 2020 4:38 am 

    “Donald Trump isn’t safe yet, but the economy is working well for him”

    Well the economy by election day will be very sick but so will the world so it is debatable how that is going to play out. The global world will be in crisis by winter. It is unclear how much the virus will spread but the economic impacts are now part of the landscape. Retail, travel, restaurants, and large gatherings will be depressed or worse. The financial markets will be hammered from their lofty heights and QE/rate repression does not do much anymore. That is a recipe for a hard recession or worse. We may see China collapse which of course takes the rest of the world into a depression. The future looks bleak. This is the worst I have seen it in the 7 years I have been on this forum. The world is finally going to pay for consequences of very bad behavior.

  19. Davy on Fri, 21st Feb 2020 4:49 am 

    Another Asian nation with a super spreader event and they have had time to prepare. In the NK is likely out of control. When this hits the P’s its going to be ugly.

    “South Korean Coronavirus Cases Explode After “Super Spreader” Event” zero hedge

    “One day after South Korea reported its first coronavirus death and shortly after all of Daegu city’s 2.5 million residents were put on lock-down, the number of covid-19 cases in South Korea has exploded, with 52 new cases reported overnight, representing a third of all the nation’s cases. After four largely uneventful weeks in which South Korea had confirmed just 30 cases, the number of cases has soared five fold in just three days, rising from 31 cases on Tuesday to 156 on Friday (local time), in what appears to be a very aggressive exponential increase… In what the Korean center for disease control called a “super spreader” event, almost half of the country’s total of 82 infections have been linked to a 61-year-old woman who worships at the Daegu church, which has often accused of being a cult… What Li meant is that Beijing is willing to sacrifice healthy citizens by commingling them with potentially infected ones, if it means that China’s GDP, already set for a record plunge, can be pushed up just a bit. Of course, none of this is lost on the people, and in a country where the biggest morbid fear is one where the middle class rises up and overthrows the communist parasites in charge, there is a distinct possibility that by telegraphing to the people just how worthless their lives are to Beijing, the instead of delivering a “positive trend” for the outbreak, China’s ruthless rulers may soon be on the receiving end of what happens when 1.4 billion Chinese grab the pitchforks and go after those who are willing to risk their lives if only it means that the “quota met” bonus payment for 2020 is made.”

  20. Davy on Fri, 21st Feb 2020 4:58 am 

    The big issue with China is if it can reboot by March. The longer this goes on the lower its basics stocks of food and supplies. In this JIT global economy this means there is likely a point where a normal reboot is not possible and large segments of the Chinses economy are damage. China was already in an economic slowdown from years of poor polices of excessive debt and overcapacity and now with a pandemic it is clear a very dangerous period is ahead. This is likely why Chinese government is pushing people to get back to work despite the dangers of further infection. It becomes an issue of what is worse the virus or economic calamity.

    ‘Weak Start To The Year’ – Maersk Warns Paralyzed Chinese Factories To Damage Global Economy” zero hedge

    “A.P. Moller-Maersk A/S, the world’s largest container shipping company, warned Thursday that the Covid-19 outbreak in China, and quickly spreading across the world, would hit earnings this year. Maersk said factories in China are currently operating at 50-60% of capacity because the economy has ground to a halt… Shipping volumes in both East to West and North to South routes were lower amid several years of front-loading by corporations ahead of President Trump’s tariffs. Lower demand was seen across Europe, Latin America, the US, and across Asia Pacific countries last quarter. The shipper said 2020 guidance is filled with many uncertainties because the deadly virus can still spread outside of China and impact the global economy. Soren Skou, Maersk’s chief executive, told the Financial Times that China could be operating at 90% capacity by March 2. Still, he noted that a lot of “things could go wrong,” such as labor and part shortages to logistics transportation, had been a nightmare for many factories in preventing them from a complete factory restart. There’s also the problem that manufacturers are running out of capital to cover labor expenses. All of this means the timelines of factory restarts in China will continue to be pushed out… The breakdown in the global supply chain is becoming a bigger threat by the day…”

  21. Davy on Fri, 21st Feb 2020 5:07 am 

    “Easily Overlooked Issues Regarding COVID-19” our finite world

    “[1] COVID-19 is incredibly contagious.
    [2] The virus likely remains active on inanimate surfaces such as paper, plastic, or metal for many days.
    [3] Given Issues [1] and [2], about the only way to avoid spreading COVID-19 seems to be geographic isolation.
    [4] The real story regarding the number of deaths and illnesses seems to be far worse than the story China is telling its own people and the world.
    [5] Our ability to identify who has the new coronavirus is poor.
    [6] Some people get much more severe symptoms from COVID-19 than others.
    [7] China has been using geographical quarantine to try to hold down the number of COVID-19 cases. The danger with such a quarantine is that once the economy is down, it is very difficult to come back to the pre-quarantine state.
    [8] A shutdown of as little as three months is likely to be damaging to the world economy.
    [9] The longer the shutdown lasts, the more likely there is to be a major collapse of the Chinese economy.
    [10] Planners everywhere have been guilty of “putting too many eggs in one basket.”
    Conclusion The world economy may become very different, simply because of COVID-19. The new virus doesn’t even need to directly affect the rest of the world very much to create a problem. The United States, Europe, and the rest of the world are very much dependent on the continued operation of China. The world economy has effectively put way too many eggs in one basket, and this basket is not now functioning as expected. If China is barely producing anything for world markets, the rest of the world will suddenly discover that long supply chains weren’t such a good idea. There will be a big scramble to try to fill in the missing pieces of supply chains, but many goods are likely to be less available. We may discover quickly how much we depend upon China for everything from shoes to automobiles to furniture to electronics. World carbon dioxide emissions are likely to fall dramatically because of China’s problems, but will the accompanying issues be ones that the world economy can tolerate? The thing that is ironic is that it is possible that the West’s fear of the new coronavirus may be overblown–we really won’t know what the impact will be with respect to people of European or of African descent until we have had a better chance to examine how the virus affects different populations. The next few weeks and months are likely to be quite instructive. For example, how will the Americans and Australians who caught COVID-19 on the cruise ships fare? What will the health outcomes be of non-Asians being brought back from Wuhan to their native countries on special planes?”

  22. Davy on Fri, 21st Feb 2020 5:11 am 

    “Devastating Impact”: One Bank Expects China’s PMI To Crater As Low As 30” zero hedge

    “To those who have been following our series of high-frequency, daily indicators of China’s economy, it will probably not come as a surprise that the world’s second biggest economy has ground to a halt, its GDP set to post the first negative print in modern history. To everyone else who is just now catching up, we have some news: it’s going to be bad. Ahead of official Chinese economic data which will soon start capturing the period when the coronavirus hit the nation, Nomura’s Chief China economist Ting Lu noted that China’s Emerging Industries PMI (EPMI), which gauges momentum in the country’s high-tech industries and is closely correlated with official manufacturing PMI, slumped to 29.9 in February (from 50.1 in January!), its lowest-print on record (introduced Jan ’14), which as Nomura’s Charlie McElligott writes “is pure reflection of the devastating impact of the COVID-19 outbreak.”… And the punchline from Ting: “We believe markets might underestimate the scale of the current growth slump. Due to a slower-than-expected rate of business resumption, we have cut our year-on-year Q1 real GDP growth forecast to 3.0% and expect Beijing to ramp up policy easing measures in coming months. That said, the likelihood of another round of massive stimulus appears low as policy space remains limited.”… In other words, while the market remains convinced that Beijing with unleash even more stimulus to force the V-shaped rebound that has been priced in for Q2 and onward, also explaining the relentless bid for risk assets, this appears unlikely to happen any time soon, especially while China is still battling to contain the coronavirus, because as Jefferies strategist Sean Darby warned, “markets have taken a step back because the authorities won’t do any major stimulus until they are completely sure the virus has stopped, because there’s no point in doing it when people are sitting at home.”

  23. Davy on Fri, 21st Feb 2020 5:18 am 

    Novel Coronavirus (COVID-19)—Fighting Products American chemistry

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