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Record-Watch: For the first time ever, more than half the US population is not working; over 76,000 Americans dead from COVID-19; the US economy is contracting at record pace; earnings expectations are collapsing at near record pace; interest-rates at record lows (and imputing negative rates by year-end); and stocks are soaring at their fastest pace ever…

As we noted earlier, there was one especially scary aspect of today’s jobs report that has not gotten enough publicity, namely that as BofA writes, the employment to population ratio plunged to a record low, with only 51.3% of the population working. Inversely, this means that in April, 49% of the US population was not working.

Source: Bloomberg

And it’s going to get worse. How else do you explain the markets pricing in hope for The Fed to cut rates to minus-40bps by Dec 2020?

Source: Bloomberg

We do note that FF futures spiked when The Fed announced Jay Powell would hold a speech next week (theoretically enabling him to jawbone down any expectations of negative rates)…

Source: Bloomberg

Which must be great news for stocks: think of all the people who have nothing better to do than buy the fucking dip all day with all that helicopter money the Fed will be showering on them for the coming years.

Nasdaq was up almost 6% this week and Small Caps ripped higher…

The Nasdaq composite was up 5 days in a row – the best streak since Dec2019 (when it went 10 days in a row without a drop)…

Sending Nasdaq green for 2020 – as if all those dead and unemployed people never mattered…

Source: Bloomberg

Because fun-durr-mentals are so bad, it must be good!!

Source: Bloomberg

Meanwhile, the nation is split politically between lockdown-deniers and stay-at-home-ers; and Democrats (who politicized the DoJ to entrap Flynn and launch a coup against Flynn) have demanded an IG probe into Barr’s politicization of The DoJ; and states/cities are demanding Federal bailouts for what they have over-promised their voters and benefactors for decades….

Small Caps and Nasdaq are up 38% from the 3/22 lows…

But volume has collapsed as stocks have gained…

Source: Bloomberg

Stocks piked to end the day on the highs as the Fed Funds futures market “tightened” away from negative rates expectations…

Source: Bloomberg

It’s the Internet, stupid!

Source: Bloomberg

FANG stocks are up 5 straight days (and 7 of last 9)…

Source: Bloomberg

Bank stocks were mostly higher on the week but quite volatile…

Source: Bloomberg

Airlines were down on the week but Hotels managed gains…

Source: Bloomberg

Overall, the median stock (Value Line Geometric index) is drastically underperforming the broader market…

Source: Bloomberg

HY was better this week but IG bonds lagged…

Source: Bloomberg

A very choppy week for bonds ended with the curve notably steeper (30Y +13bps, 2Y -4bps)

Source: Bloomberg

10Y spiked today – despite the dismal jobs data (on more Fed taper and Powell speech headlines)…

Source: Bloomberg

New record all-time lows for 2Y and 5Y yields…

Source: Bloomberg

The dollar ended the week unchanged… with weakness in the last two days as negative rates started to rear their ugly head…

Source: Bloomberg

Cryptos were all higher on the week, with a notable alt-coin to bitcoin rotation…

Source: Bloomberg

Bitcoin pushed up to $10,000 today…

Source: Bloomberg

Notably gold and Bitcoin surged as negative rates came into the picture (and gold dipped today as negative rates were priced out)…

Source: Bloomberg

Commodities were all higher this week…

Source: Bloomberg

But oil – again – was the big winner…though largely sideways $23-25…

Gold and Silver decoupled a few times this week…

GLD inflows continue their streak (30 days straight and counting)…

Source: Bloomberg

Finally, as we noted earlier, the Nasdaq is now bigger than the rest of the world’s stock markets put together…

Some numbers via BofA’s Michael Hartnett putting the recent market move in context:

• 9/10 say bear market rally

• 8/10 say “U” or “W” recovery

• 7/10 say only buy what the Fed buys

• 6/10 expect retest of low

• 2/10 say 10Y yield >1%,

• <1/10 say stocks in bull market;

• $15 Trillion: global equity market cap gain since March low

• $16.4 Trillion: global policy stimulus (QE + fiscal) in 2020;

• $9 Trillion 2020 QE

• $7.4 Trillion: 2020 fiscal stimulus

• 107: global rate cuts in 2020

• $9 Trillion: global GDP loss in 2020/21

• $4.8 trillion in money market funds

• 33 Million: jump in US unemployment past 8 weeks;

• 13%: US household savings ratio

• 1945: last year in which Royal Dutch Shell cut dividend

• 10.9% YTD performance of  gold

• 8.5% US Treasuries

• 3.8% US dollar

• 2.9% government bonds;

• 0.5% cash

• -11.8%: S&P500

• -40%: commodities

• 0: BofA’s Bull and Bear Indicator

• 51.3%: percentage of US population that is employed

Bonus 1: Some Dates

Bonus 2: Some Bailouts

Bonus 3: Some Returns

Bonus 4: Some Investor Sentiment

…from a reader,

I don’t have to tell you things are bad.

Everybody knows things are bad.

It’s a depression…

Everybody’s out of work or scared of losing their job.

The dollar buys a nickel’s worth, banks are going bust, shopkeepers keep a gun under the counter.

Punks are running wild in the street and there’s nobody anywhere who seems to know anything…

And the stock-market is SOARING…

We know how he feels…

A group of Democrats – whose mostly white, middle-class, college-educated supporters who derive most of their understanding of contemporary politics and the economy from memes – is pushing House Speaker Nancy Pelosi and Minority Leader Kevin McCarthy to include a “universal, one-time, student loan debt cancellation of at least $30,000 per borrower in the next round of COVID-19 relief legislation.”

So-called Democratic socialists love to drone on about how policies like universal health-care and student loan forgiveness are “popular” (that is, according to several questionably worded surveys), but the truth is, the overwhelming majority of Americans aren’t currently paying down student debt. Fewer than 45 million Americans – that’s less than one-third of working-age adults – are student loan borrowers, and they share nearly $1.5 trillion in debt.

Reps. Ilhan Omar, Ayanna Pressley, Alma Adams and 28 other lawmakers have all co-signed a letter urging the leadership to turn on the money spigot that only rewards Americans who are already mostly white, mostly middle class and mostly fine.

We’d love to hear the explanation why they’re calling for the forgiveness of student debt, not any other types of consumer debt, like mortgage debt (for homes) or credit card debt (for food…and all those vacations you couldn’t afford).

Simply forgiving the loans would do nothing to change a system that produces over-indebted students (and one component of changing that system needs to be consumers taking responsibility for their choices and thinking twice before signing up to get that masters in anthropology, or comparative lit, or gender studies).

President Trump said earlier this afternoon that he couldn’t be sure when Congress would get around to passing another coronavirus relief bill, or even if there would be another bill.

But that didn’t stop Ilhan Omar from hopping right up on that soapbox to talk about how we should just hand out money to all Americans in perpetuity – except landlords, because Karl Marx said they’re evil – just keep the money spigot running until a vaccine is ready and available for all.

We’ve lost 25 million jobs in 2 months, 3 times the entire Great Recession.

House leadership needs to deliver for the PEOPLE.

We need to be bold in meeting the needs of the American people:

– Universal monthly payments
– Fully fund healthcare for all
– Cancel Rent/Mortgages

— Ilhan Omar (@IlhanMN) May 8, 2020

Until then, nobody’s allowed to go outside.

YouTube demonetized the account of popular Chinese-American blogger Jennifer Zeng Thursday night, after she published a video which considers several possibilities for the origins of COVID-19, according to Forbes.

What? “We’ve determined that your channel is no longer eligible for monetization” ! What should I do?
油管刚刚通知我说，取消我频道的广告资格！我该怎么办？ pic.twitter.com/X31GouFRhA

— Jennifer Zeng 曾錚 (@jenniferatntd) May 8, 2020

The New York-based Zeng, who grew up in China and spent time as a prisoner in a CCP labor camp, has picked up a following on YouTube and Twitter after posting some of the most insightful, unfiltered footage of what’s been going on inside China and elsewhere during the coronavirus outbreak.

“I’ve been warned before by YouTube and have always appealed,” she said, adding “I’ve been warned by them on maybe 95% of my coronavirus videos. I just got this note last night and I wrote to them about it this morning.”

In the video, which has not been censored and is still available, Zeng reviews a story published on a Falun Gong website called Minghui. The authors used pen names, without usual surnames, suggesting they are writing from inside China. The paper is one of the enemies of the Chinese Communist Party, which likens the Falun Gong to an insurgency.

The video goes through a list of seven of the origination theories circulating among official circles and not Western conspiracies about it being a bioweapon manufactured by China.

However, it does note that weaponization was one of the origin stories the Chinese government used early on to deflect blame towards Washington. That origin story was put out by a Chinese military website and spread via social media, making headlines here at home. The article was taken down later. It does not seem to be part of the official China narrative anymore. –Forbes

It appears that Censorship over coronavirus reporting has only gotten worse in recent months, with this site having been banned by Twitter for reporting on a Wuhan scientist currently at the center of an international investigation by the ‘five eyes’ spy agencies, while YouTube has banned divergent opinions from the platform.

Last week, YouTube CEO Susan Wojcicki told CNN‘s “Reliable Sources” that any content which goes against World Health Organization (WHO) recommendations for dealing with the coronavirus would be dealt with.

“Anything that goes against W.H.O will be removed from YouTube”

YouTube CEO Susan Wojcicki

pic.twitter.com/1TxwdBMq17

— LΞIGH (@LeighStewy) April 21, 2020

“Anything that is medically unsubstantiated, so people saying ‘Take Vitamin C or take turmeric, those cure you,’ those are examples of things that would be a violation of our policy. Anything that would go against World Health Organization recommendations would be a violation of our policy,” she said.

So – if one made a video telling people not to wear face masks, like the WHO did, or that coronavirus is not transmissible between humans, like the WHO claimed, or any of the other positions the WHO has flip-flopped on, how would YouTube ‘deal with’ it?

What makes Zeng’s case particularly notable is that the Wuhan lab leak theory has become mainstream – even if it’s not the view endorsed by the China-friendly WHO.

That the virus was not man-made but escaped a lab is shared not only by the Five Eyes intelligence collaborative of the U.S., U.K., Canada, New Zealand and Australia, but also by some Democrats.

“I don’t think it was spliced and diced in the Wuhan Institute of Virology,” says Jamie Metzl, a senior fellow at The Atlantic Council and a former senior official for both Bill Clinton and Joe Biden when he was a Senator. “But I do believe it escaped a lab, accidentally.”

Metzl’s view of the lab escape makes it more difficult to sum this up as merely anti-China, or pro-Trump sentiment. Metzl is not anti-China. –Forbes

And according to Secretary of State Mike Pompeo, “There is enormous evidence that this is where it began,” referring to the Wuhan Institute of Virology.

So – when it comes to the roundtable of discussion, YouTube will only allow those who agree with one side – stifling debate while protecting China.

Read the rest of the report here.

Earlier today we reported that 2Y yields hit record lows after Fed Funds futures accelerate their move to suggest increasingly more negative negative rates this morning, with the first negative implied rates expected to hit as soon as November.

And why not: as we explained last night, Powell had to “immediately” address markets and forcefully explain that the Fed will not allow negative rates (unless of course the Fed does plan on greenlighting NIRP) or else risk another crisis if in a few weeks when Powell finally does address this issue, when NIRP has become far more institutionalize, and risk a market revulsion to a hawkish Fed.

Well, we did not have long to wait, because with late 2020, early 2021 contracts hitting record high levels above 100 (implying increasingly more negative Fed Fund rates), some noticed that Powell’s schedule was updated to include a speech on the economy on May 13 discussing “Current Economic Issues.”

In kneejerk reaction, Fed funds futures, perhaps expecting that the topic of the ad hoc speech will be the rate inversion, immediately dropped with late 2020 contracts lower by as much as 2bp, while most contracts fell to session lows, with Dec20 trading at 99.99 after dropping ~1bp after the schedule change was reported. The Jan21 contract also dropped below 100 vs session high 100.04 reached around the time of U.S. jobs report release.

As a result, all those implied fed funds rates which had turned negative as recently as this morning, spiked above 0% for all the closely watched contracts, from Nov 20 to Jan 21, and no longer price in negative rates, which while potentially hitting yields which are now at session highs, has yet to be noticed by stocks which continue to trade at session highs on the day the US reported its worst jobs report ever.

Authored by Chris Martenson via PeakProsperity.com,

Natural or man-made/manipulated?

The debate rages on, though evidence is starting to mount on the side of at least *some* manipulation.

In Tuesday’s video, Chris talked about the polybasic furin cleavage site PRRA which looks suspiciously like an ‘insert’ in covid-19’s genetic coding.

In today’s video, he focuses on the RaTG13 sequence, which raises even more questions. It suggests that either the sequence itself is not natural OR that the larger covid-19 virus isn’t.

There are even further questions raised by the virus’ E protein. But enough of the science-speak. I’ll let Chris explain it all to you here:

Don’t forget to get your free download of Peak Prosperity’s book Prosper!. Given its relevance to preparing for any kind of crisis, pandemic or otherwise, Chris and I are now making it available to the world for free during the covid-19 lockdown.

To download your free copy, click here.