Tag: finance

Summary:

• India cases top 150k
• France discontinues use of hydroxychloroquine
• Japan, EU push new stimulus
• New Chinese study confirms COVID uses same ‘strategy’ as HIV to cripple immune system
• Wuhan finds 200 ‘asymptomatic’ cases after testing millions
• ECB’s Lagarde said eurozone economy could take 12% hit due to virus
• WHO reiterates warnings about premature reopening

* * *

California Gov. Gavin Newsom’s decision to allow retailers across the state to reopen (along with barbershops and salons in most counties) helped galvanize investors’ hopes for a “V-shaped” rebound in the US, setting US equities on the path to opening with strong gains for a second straight day on Wednesday, even after the death toll in the US surpassed 100k late Tuesday.

A few days ago, authorities in Wuhan claimed that they had tested more than 7 million people, part of an effort to quash a ‘second wave’ of the virus. Overnight, Chinese business news org Caixin reported that roughly 200 patients tested positive for the virus, all of whom were considered “asymptomatic”.

PM Narendra Modi’s heavy-handed response to the coronavirus outbreak has been credited with preventing a destabilizing outbreak in the world’s second-largest country by population. Although many Indians remain leery of the world outside their front door, infection numbers have continued to rise at a steady clip. On Wednesday, Indian public health authorities confirmed another 6,387 new infections and 170 deaths reported in the last 24 hours, bringing India’s total to 151,767 confirmed infections, and 4,337 deaths, according to Nikkei.

France’s health ministry said Wednesday it would discontinue the use of hydroxychloroquine for treating COVID-19 patients, and in all clinical trials, while health officials in India expanded the use of the controversial drug, which was famously touted by President Trump, who also claimed to be taking the medication as a kind of prophylactic. France’s decision is notable because Didier Raoult, a virologist based in Marseille, has repeatedly championed its efficacy if taken alongside zinc or a powerful antibiotic like a Z-Pak.

Across Asia and Europe, new measures to offset the tremendous cost of the outbreak were introduced on Wednesday, with the Japanese cabinet approving another 6% of GDP in stimulus spending, just one month after approving  a first supplementary budget. Combined with the prior package, PM Shinzo Abe said that Japan will have pumped the equivalent of 40% of its GDP in stimulus spending into its economy. “With the largest policy package in the world, the Japanese economy will hold fast against this once in a hundred year crisis,” Abe said.

Just when we believed ‘coronabonds’ were as good as dead, the European Commission is reportedly planning to borrow as much as €750 billion to dole out to the hardest-hit countries, according to Commission President Ursula von der Leyen. As was widely reported in March and April, an alliance of wealthy northern states led Germany and the Netherlands seemed to have put the issue to rest, as they insisted that Italy and Spain can always submit to the European Stability Mechanism (and the punishing austerity it would almost certainly prescribe) if they needed emergency financing. Von der Leyen is expected to lay out the details of the new coronavirus relief fund on Wednesday afternoon in Europe.

Watch von der Leyen live:

Regardless of how the EU responds, ECB Chief Christine Lagarde, one of the most vocal advocates for “coronabonds” and a strong fiscal stimulus to revive Europe’s moribund economy, said Wednesday that the eurozone economy could shrink by as much as 12% this year as the “sudden stop” caused by the pandemic is expected to lead to a prolonged recession that’s even deeper than the post-GFC period.

Authorities in Wuhan found more than 200 asymptomatic cases of the new coronavirus since launching an ambitious plan earlier this month to test the city’s entire population, according to municipal health officials.

On May 11, health authorities in the central Chinese metropolis, where the deadly virus was first detected, ordered municipal districts to start conducting nucleic acid tests on all residents. As of Saturday, the city had carried out 6.68 million tests and discovered 206 asymptomatic cases across more than 10 districts, according to notices from the municipal health commission. About 11 million people live in Wuhan.

With the number of confirmed coronavirus cases in Brazil expected to cross the 400k-threshold on Wednesday, prosecutors in President Jair Bolsonaro’s Brazil authorized the arrest of the conservative governor of Rio de Janeiro state on suspicion of corruption, Reuters reports. The arrest follows a falling-out between the governor and Bolsonaro over the latter’s handling of the outbreak.

As the number of newly confirmed cases in the US tumbled to its lowest level since March on Tuesday, the World Health Organization reiterated warnings about the dangers of scaling back coronavirus restrictions too quickly, arguing that a “premature” push to return to normalcy could unleash a brutal ‘second wave’.

“We cannot make assumptions that just because the disease is on the way down now that it’s going to keep going down,” Mike Ryan, head of the WHO’s health emergencies program, told reporters during a briefing.

Despite a flurry of research over the past few months, scientists concede that nobody really knows anything for certain about SARS-CoV-2. In the US, at least, the initial justification for the lockdown was to flatten the curve so hospitals aren’t overwhelmed. Data overwhelmingly suggests that the US accomplished this weeks ago. But the WHO’s Dr. Mike Ryan insisted that the virus could pop back up “at any time”.

Before we go, we’d like to remind readers that, back on Feb. 1, Zero Hedge highlighted some non-peer-reviewed research claiming that the virus’s genome appeared to contain ‘HIV-like insertions’ that helped stoke suspicions about the possibility that the virus was an artificially created bioweapon.

We were widely pilloried for sharing this research at the time. But now, roughly four months later, another study appears to have replicated these findings.

Let’s all remember what the NYT’s Nick Kristof wrote about the importance of humility.

Authored by Tsvetana Paraskova via OilPrice.com,

At least five oil producers offshore Brazil, including international oil majors and state oil firm Petrobras, have seen COVID-19 infections among offshore workers spike in recent weeks, industry and government sources told Reuters on Tuesday.

Brazil’s Petrobras and Enauta Participacoes, as well as Shell, Equinor, and Perenco have registered cases of coronavirus infections among workers or contractors who are sharing confined areas on offshore oil rigs.

At the same time, Brazil surpassed Russia last week to become the country with the second-largest number of COVID-19 infections behind the United States. The U.S. moved to ban as of Tuesday the travel of foreign nationals from Brazil into the United States in a temporary move to prevent the spread of COVID-19 from Brazil.

According to sources and data from regulators compiled by Reuters, Norwegian major Equinor had around 60 coronavirus cases as of last week, most of which at the Peregrino oilfield, Perenco had 40 cases, while Petrobras had more than 300 workers among staff and contractors with COVID-19.

Shell and Enauta had one coronavirus case each, the two companies told Reuters.

Petrobras says that it is taking every person’s temperature upon boarding offshore units and has adopted work-from-home as much as possible.

Days before the production cuts at the OPEC+ group formally began on May 1, Petrobras of Brazil – which is not part of that group – said that it had reversed the cuts it had announced in early April, opting for “the gradual return to an average oil production level of 2.26 MMbpd in April alongside an increase in the utilization factor of our refineries,” due to better than expected demand for its products.

Yet, the coronavirus pandemic spiraling out of control in Brazil could crush its oil industry, analysts say. Apart from the health of the offshore oil workers, Brazil’s oil sector is threatened by the low oil prices and the economic downturn in the country and in the world. Being state-held, Petrobras’s ratings are closely related to the credit rating of Brazil.

After decades of growth for world trade, global tourism and international cooperation, globalization hit a couple of roadblocks in recent years, as the reemergence of nationalism and protectionism have undone some of the progress made in the past. After global trade growth slowed significantly in 2019, due in large part to trade tensions between the United States and China, the COVID-19 pandemic is expected to cause an unprecedented fall in world trade.

According to estimates from the World Trade Organization, world merchandise trade is set to plummet between 13 and 32 percent this year, depending on how quickly the coronavirus is contained and trade can return to pre-crisis levels.

“These numbers are ugly – there is no getting around that. But a rapid, vigorous rebound is possible,” WTO Director-General Roberto Azevêdo said in a press release on the matter, while emphasizing the role of free trade on the road to recovery.

“Keeping markets open and predictable, as well as fostering a more generally favourable business environment, will be critical to spur the renewed investment we will need. And if countries work together, we will see a much faster recovery than if each country acts alone.”

As the following chart based on World Bank data shows, global trade volume – measured here as a percentage of global GDP – has been relatively stagnant for years, after several decades of uninterrupted growth.

You will find more infographics at Statista

Following the trade decline caused by the global financial crisis in 2009, world trade never returned to its previous growth trajectory and many are expecting a similar long-term effect of the current crisis.

Having reminded many companies of the vulnerabilities of global supply chains, both the pandemic and the trade war between the U.S. and China could lead companies towards a more domestic approach to production and sourcing, which might result in a sustained reduction of global trade.

Authored by Steve Watson via Summit News,

The White House national security advisor Robert O’Brien has compared China’s response to the coronavirus outbreak to the Soviet Union’s cover-up of the meltdown at the Chernobyl nuclear power plant.

“They unleashed a virus on the world that’s destroyed trillions of dollars in American economic wealth that we’re having to spend to keep our economy alive, to keep Americans afloat during this virus,” O’Brien said in an NBC interview.

“The cover-up that they did of the virus is going to go down in history, along with Chernobyl.” O’Brien added.

“We’ll see an HBO special about it 10 or 15 years from now.” he urged, referring to the recent award winning dramatisation of the 1986 disaster.

“This is a real problem and it cost many, many thousands of lives in America and around the world because the real information was not allowed to get out,” O’Brien further proclaimed.

“It was a cover-up. And we’ll get to the bottom of it eventually.” O’Brien asserted.

O’Brien’s comments come as Shi Zhengli, the the deputy director of the Wuhan Institute of Virology, warned that COVID-19 is ‘just the tip of the iceberg’ of unknown deadly viruses, while again denying that her lab had anything to do with the outbreak.

“If we want to prevent human beings from suffering from the next infectious disease outbreak, we must go in advance to learn of these unknown viruses carried by wild animals in nature and give early warnings.” Shi said, adding “If we don’t study them there will possibly be another outbreak.”

As details continue to emerge, China admitted recently that it did order laboratories to destroy samples of the new coronavirus in the early stage of the outbreak.

The destruction of the samples was first noted back in February. It was also noted that the Wuhan Institute of Virology, which was conducting controversial experiments into animal-to-human transmission of bat coronaviruses, altered their database in an apparent attempt to distance the lab from the outbreak.

The alteration was carried out just two days before a gene sequencing lab was ordered by the Health and Medical Commission of Hubei Province to destroy it’s coronavirus samples.

In addition, a scientific study in Austria has found that SARS-CoV-2 was likely created in a lab, barring some “remarkable coincidence” that led to the virus naturally evolving to be optimised to attack human cells.

The authors of the study believe this means that the virus “became specialized for human cell penetration by living previously in human cells, quite possibly in a laboratory.”

Authored by Judith Bergman via The Gatestone Institute,

On May 13, the French parliament adopted a law that requires online platforms such as Facebook, Google, Twitter, YouTube, Instagram and Snapchat to remove reported “hateful content” within 24 hours and “terrorist content” within one hour. Failure to do so could result in exorbitant fines of up to €1.25 million or 4% of the platform’s global revenue in cases of repeated failure to remove the content.

The scope of online content deemed “hateful” under what is known as the “Avia law” (after the lawmaker who proposed it) is, as is common in European hate speech laws, very broadly demarcated and includes “incitement to hatred, or discriminatory insult, on the grounds of race, religion, ethnicity, gender, sexual orientation or disability”.

The French law was directly inspired by Germany’s controversial NetzDG law, adopted in in October 2017, and it is explicitly mentioned in the introduction to the Avia law.

“This law proposal aims to combat the spread of hate speech on the internet,” it is stated in the introduction to the Avia law.

“No one can dispute the exacerbation of hate speech in our society… the attack[s] on others for what they are, because of their origins, their religion, their sex or their sexual orientation… hints… [at] the darkest hours in our history… the fight against hatred, racism and anti-Semitism on the Internet is an objective of public interest that justifies…strong and effective provisions… this tool of openness [the internet] to the world, of access to information, to culture, to communication, can become a real hell for those who become the target of ‘haters’ or harassers hidden behind screens and pseudonyms. According to a survey carried out in May 2016, 58% of our fellow citizens consider the internet to be the main locus of hate speech. More than 70% say they have already been confronted with hate speech on social networks. For younger people in particular, cyber-harassment can be devastating…However… Few complaints are filed, few investigations are successful, few convictions are handed down – this creates a vicious circle…”

Having acknowledged that online “hatred” is tricky to prosecute under the existing laws because “few complaints are filed and few investigations are successful, few convictions are handed down”, but nevertheless determined that censorship is the panacea to the perceived problems, the French government decided to delegate the task of state censorship to the online platforms themselves. Private companies will now be obliged to act as thought police on behalf of the French state or face heavy fines. As in Germany, such legislation is bound to lead to online platforms exhibiting overzealousness in the removal or blocking of anything that might conceivably be perceived as “hateful” to avoid being fined.

The purpose of the law appears to have been twofold — not only to achieve the actual censorship of speech by the removal or blocking of online posts, but also the (inevitably) chilling effects of censorship on online debate in general. “People will think twice before crossing the red line if they know that there is a high likelihood that they will be held to account,” French Minister of Justice Nicole Belloubet said in what sounded ominous for a government representative to say in a country that still claims to be democratic.

From the beginning, when French President Emmanuel Macron first tasked the group led by Laetitia Avia with preparing the law, the proposal was met with criticism from a number of groups and organizations. France’s National Consultative Commission on Human Rights criticized the law proposal for increasing the risk of censorship, and La Quadrature du Net, an organization that works against censorship and surveillance online, warned that, “Short removal times and large fines for non-compliance further incentivize platforms to over-remove content”. The London-based free speech organization Article 19 commented that the law threatened free speech in France. According to Gabrielle Guillemin, Senior Legal Officer at Article 19:

“The Avia Law will effectively enable the French state to devolve online censorship to the dominant tech companies, who will be expected to act as judge and jury in determining what is ‘manifestly illegal’ content. The Law covers a wide range of content so this is not always going to be a straightforward decision.

“Given the timeframes by which companies have to respond, we can expect them to err on the side of caution when it comes to deciding whether content is legal or not. They will also have to resort to using filters that will inevitably lead to the over-removal of content.

“The French government has ignored the concerns raised by digital rights and free speech groups, and the result will be a chilling effect on online freedom of expression in France”.

The passed law was also met with disapproval in France. On May 22, Guillaume Roquette, editorial director of Le Figaro Magazine, wrote:

“Under the pretext of fighting ‘hateful’ content on the Internet, it [the Avia law] is setting up a system of censorship that is as effective as it is dangerous… ‘hate’ is the pretext systematically used by those who want to silence dissenting opinions.

“This text [law] is dangerous because, according to lawyer François Sureau, ‘it introduces criminal punishment… of the conscience’. It is dangerous…because it delegates the regulation of public debate… on the internet to American multinationals… A democracy worthy of its name should accept freedom of expression”.

Jean Yves Camus. from Charlie Hebdo, called the law “a placebo for fighting hate” and pointed out that the “hyper-focus on online hate” masks the real danger:

“It is not online hatred that killed Ilan Halimi, Sarah Halimi, Mireille Knoll, the victims of the Bataclan, Hyper Cacher and Charlie; it is an ideology called anti-Semitism and/or Islamism… Who determines what hatred is and its [distinction from] criticism? A Pandora’s box has just been opened… There is a risk of a slow but inexorable march towards a digital language hyper-normativized by political correctness, as defined by active minorities”.

“What is hate?” asked French writer Éric Zemmour rhetorically. “We do not know! You have the right not to love… you have the right to love, you have the right to hate. It’s a feeling… It cannot be judicialized, legislated.”

Nevertheless, that is what hate speech laws do, whether in the digital or the non-digital sphere. Asking private companies — or the government — to act as thought police does not belong in a state that claims to follow a democratic rule of law.

Unfortunately, the question is not whether France will be the last European country to introduce such censorship laws, but what other countries are next in line.

A new study revealed that 43% of people feel they’ve “changed their ways for the better” as a result of the extra time they had during coronavirus lockdowns. Many found new habits and activities — including creating podcasts, learning to code, and exercising. 

The study, commissioned by LG Electronics, polled nearly 2,000 British adults of how their daily lives were transformed because of the lockdowns. About half of the respondents said they would maintain the newly acquired hobbies, skills, and daily habits in a post-corona world.

Learning new computer skills, creating podcasts, participating in online fitness classes, and walking outside were some of the top activities people turned to during lockdowns. It was increasingly evident that technology played a significant role in occupying people’s time: 54% said they couldn’t function without a computer, 64% said smartphones were critical, and 57% couldn’t do without television. 

“The fact that many people are forming productive and healthy new habits is testament to the nation’s ability to adjust,” Hanju Kim, IT product director at LG UK, said in a statement. 

“The nation is working from home and has an appetite to continue working flexibly even after offices reopen. A big part of this can be attributed to technology keeping us connected,” said Kim. 

Around 20% of respondents said they slept more during lockdowns, while 10% said they learned new things from YouTube tutorials. 

Two-fifths of respondents believe these new habits and activities will increase their wellbeing, while one in four noticed a more comfortable life that allowed for a better routine in daily activities. About a quarter found new ways of making money during the lockdowns. 

The research found that social distancing led to an increase in video conference calls among respondents, who used the software to connect with friends, family, and work. Roughly half said they conducted video calls more than they did before lockdowns.

And 48% plan to keep this up in a post-corona world, or even increase this new lifestyle, suggesting how people’s daily lives will forever change and could soon result in huge economic impacts. 

Regardless of how long the current public health crisis lasts, people working at home will result in forcing huge changes and ultimately restructuring the old economy. This could have profound impacts on corporate real estate, transportation, energy, restaurants, and many other industries. With the economy crashed, the restructuring phase has just begun, it will take several years for the recovery to play out.

Authored by Jason Ditz via AntiWar.com,

After weeks of military gains by Libya’s Government of National Accord (GNA), President Trump has called for a deescalation during his phone call with Turkey’s President Erdogan. Turkey is the GNA’s only foreign ally.

This is bound to once again raise questions about the US position. Nominally the US is backing the GNA, but at times Trump has expressed support for their enemy, the Libyan National Army (LNA). The deescalation would be seen as bailing out the LNA from recent losses.

“President Trump reiterated concern over worsening foreign interference in Libya and the need for rapid de-escalation,” White House spokesman Judd Deere said in a statement.

The LNA has a lot of foreign allies, from France and Russia to virtually the whole list of Gulf Arab states. LNA leader Khalifa Hafter, was a CIA asset in the past, and the US has criticized Russia for being too close with him, despite their own long history of backing him.

Reuters reports:

As the LNA has promised to respond with a massive air campaign, diplomats have warned of the risk of a new round of escalation with the warring sides’ external backers pouring in new weaponry.

Turkey “will not bow to threats by Haftar or anyone else,” Turkey’s presidential spokesman Ibrahim Kalin said separately in an interview on NTV.

LNA General Commander Field Marshal Khalifa Haftar: Every Turkish solider, mercenary sent by Erdogan to Libya and every traitor who has allowed the occupier to return is a target of our armed forces. Do not show them any mercy. #Libya #LibyaReview pic.twitter.com/ywJNeGfvkx

— Libya Review (@LibyaReview) May 23, 2020

It’s not clear where Turkey is going with this, as they mostly want maritime rights and a military base.

Those are likely secured already, but the GNA probably feels very little need to step down in the face of recent gains.

Authored by James Rickards via The Daily Reckoning,

Remember the pro-democracy protests in Hong Kong against Chinese authoritarianism?

Well, guess what? They’re about to start again.

And U.S.-Chinese relations could get even worse than they are right now.

Are you prepared for a bumpy ride?

Let’s unpack this…

Last year’s protests came in response to a proposed law that would have allowed the extradition of Hong Kong residents to Beijing for trial on charges that arose in Hong Kong.

That would have deprived Hong Kong residents of legal protections in local law and subjected prisoners to torture and summary execution.

The legislation was proposed by Hong Kong’s Chief Executive Carrie Lam, who many consider a puppet of Beijing.

The demonstrations grew exponentially, ultimately involving hundreds of thousands of protesters.

The list of demands also grew to include more democracy and freedom and adherence to Hong Kong’s rule of law.

Due to social media, these protests were seen around the world.

The proposed bill behind the original protests was scrapped last October, which was a victory for the pro-democracy protesters.

The protests didn’t end altogether, but tensions were at least diffused to a great extent and the world moved on.

Well, here comes round two…

China’s Communist parliament is preparing to roll out legislation that would ban “treason, secession, sedition (and) subversion” in Hong Kong.

This is different from the previous legislation because this bill actually originates in Beijing, not Hong Kong. It’s a direct assault on Hong Kong’s democracy. The Chinese parliament would insert the legislation directly into Hong Kong’s constitution.

It’s scheduled for passage next week.

Pro-democracy activists have called for mass protests this weekend in response to what they rightly consider a Chinese invasion of their autonomy.

We could be in for a fresh round of protests, with as many or more people. China’s reaction will be key.

Will they try to put the protests down by force? That could have major consequences.

Yesterday, news emerged that the U.S. Senate is introducing bipartisan legislation to impose sanctions on officials and business entities that enforce the new law.

And President Trump warned yesterday that the U.S. would react “very strongly” to the Chinese legislation.

In response, China’s foreign ministry warned Beijing would “fight back” against any U.S. interference.

At a time when U.S.-Chinese relations are already at a low ebb due to China’s almost criminal handling of the coronavirus pandemic, it looks like things are about to get even worse.

This situation could become very interesting.

But you shouldn’t be surprised. The current trajectory of U.S.-China relations is following a familiar course. It started with the currency war…

When my first book, Currency Wars, was published in 2011, I made the point that currency wars don’t exist all the time, but when they emerge they can last for 15 or 20 years.

The reason is that the currency devaluations just go back and forth between major trading partners and no one is any further ahead in the long run.

Readers said, “OK, we get that, but what comes next?”

The answer is trade wars. Once currency devaluations fail, countries turn to tariffs to slow down imports and help their own exports.

That’s where the U.S. and China are now, with the ongoing trade war (which could get worse).

But that’s also a dead end from an economic perspective. Again, the question is: What comes next?

Well, with history as a guide, we can see that today’s pattern is a repeat of what the world went through in the 1920s and 1930s.

First came currency wars (1921–1936). Then came trade wars (1930–34) and then finally a shooting war (1939–1945).

Are we heading for another shooting war with China? The signs are not good.

Trade war tariffs can be weaponized to pursue geopolitical goals. Trump is using tariffs to punish China for its criminal negligence (or worse) in connection with the spread of the Wuhan virus to the U.S. and the rest of the world.

This also has historical precedent.

Between June and August 1941, President Franklin Roosevelt placed an oil embargo on Japan and froze Japan’s accounts in U.S. banks.

In December 1941, the Japanese retaliated with the sneak attack on Pearl Harbor. Will China now escalate its retaliation to the point of armed conflict?

We’ll find out soon, possibly in the South China Sea or the Taiwan Strait. The latest reemergence of tensions in Hong Kong only adds kerosene to the fire.

Investors should prepare for U.S.-China geopolitical tension to grow worse. Maybe a lot worse. That’s the lesson of history.

In 2019, nearly 70% of U.S. GDP was driven by personal consumption. However, as Visual Capitalist’s Iman Ghosh notes, in the first and second quarters of 2020, the COVID-19 pandemic has initiated a transformation of consumer spending trends as we know them.

Consumer Spending in Charts

By leveraging new data from analytics platform 1010Data, today’s infographic dives into the credit and debit card spending of five million U.S. consumers over the past few months.

Let’s see how their spending habits have evolved over that short timeframe:

The above data on consumer spending, which comes from 1010Data and powered by AI platform Exabel, is broken into 18 different categories:

• General Merchandise & Grocery: Big Box, Pharmacy, Wholesale Club, Grocery

• Retail: Apparel, Office Supplies, Pet Supplies

• Restaurant: Casual dining, Fast casual, Fast food, Fine dining

• Food Delivery: Food delivery, Grocery Delivery, Meal/Snack kit

• Travel: Airline, Car rental, Cruise, Hotel

It’s no surprise that COVID-19 has consumers cutting back on most of their purchases, but that doesn’t mean that specific categories don’t benefit from changes in consumer habits.

Consumer Spending Changes By Category

The onset of changing consumer behavior can be observed from February 25, 2020, when compared year-over-year (YoY).

As of May 12, 2020, combined spending in all categories dropped by almost 30% YoY. Here’s how that shakes out across the different categories, across two months.

General Merchandise & Grocery

This segment saw a sharp spike in initial spending, as Americans scrambled to stockpile on non-perishable food, hand sanitizer, and toilet paper from Big Box stores like Walmart, or Wholesale Clubs like Costco.

In particular, spending on groceries reached a YoY increase of 97.1% on March 18, 2020. However, these sudden panic-buying urges leveled out by the start of April.

Pharmaceutical purchases dropped the most in this segment, possibly as individuals cut back on their healthcare expenditures during this time. In fact, in an April 2020 McKinsey survey of physicians, 80% reported a decline in patient volumes.

Retail

With less foot traffic in malls and entire stores forced to close, sales of apparel plummeted both in physical locations and over e-commerce platforms.

Interestingly, sales of office supplies rose as many pivoted to working from home. Many parents also likely required more of these resources to home-school their children.

Restaurant

The food and beverage industry has been hard-hit by COVID-19. While many businesses turned to delivery services to stay afloat, those in fine dining were less able to rely on such a shift, and spiraled by 88.2% by May 5, 2020, year-over-year.

Applebees or Olive Garden exemplify casual dining, while Panera or Chipotle characterize fast casual.

Food Delivery

Meanwhile, many consumers also shifted from eating out to home cooking. As a result, grocery delivery services jumped by over five-fold—with consumers spending a whopping 558.4% more at its April 19, 2020 peak compared to last year.

Food delivery services are also in high demand, with Doordash seeing the highest growth in U.S. users than any other food delivery app in April.

Travel

While all travel categories experienced an immense decline, cruises suffered the worst blow by far, down by 87.0% in YoY spending since near the start of the pandemic.

Airlines have also come to a halt, nosediving by 91.4% in a 10-week span. In fact, governments worldwide have pooled together nearly $85 billion in an attempt to bail the industry out.

Hope on the Horizon?

Consumer spending offers a pulse of the economy’s health. These sharp drops in consumer spending fall in line with the steep decline in consumer confidence.

In fact, consumer confidence has eroded even more intensely than the stock market’s performance this quarter, as observed when the Index of Consumer Sentiment (ICS) is compared to the S&P 500 Index.

Many investors dumped their stocks as the coronavirus hit, but consumers tightened their purse strings even more. Yet, as the chart also shows, both the stock market and consumer sentiment are slowly but surely on the mend since April.

As the stay-at-home curtain cautiously begins to lift in the U.S., there may yet be hope for economic recovery on the horizon.

Submitted by Thomas Farnan

CrowdStrike – the forensic investigation firm hired by the Democratic National Committee (DNC) to inspect its computer servers in 2016 – admitted to Congressional investigators as early as 2017 that it had no direct evidence of Russian hacking, recently declassified documents show.

CrowdStrike’s president Shawn Henry testified, “There’s not evidence that [documents and emails] were actually exfiltrated [from the DNC servers]. There’s circumstantial evidence but no evidence that they were actually exfiltrated.”

This was a crucial revelation because the thousand ships of Russiagate launched upon the positive assertion that CrowdStrike had definitely proven a Russian hack.

This sworn admission has been hidden from the public for over two years, and subsequent commentary has focused on that singular outrage.

The next deductive step, though, leads to an equally crucial point: Circumstantial evidence of Russian hacking is itself flimsy and collapses when not propped up by a claim of conclusive forensic testing.

THE COVER UP.

On March 19, 2016, Hillary Clinton’s campaign chairman, John Podesta, surrendered his emails to an unknown entity in a “spear phishing” scam. This has been called a “hack,” but it was not.  Instead, it is was the sort of flim-flam hustle that happens to gullible dupes on the internet.

The content of the emails was beyond embarrassing. They showed election fraud and coordination with the media against the candidacy of Bernie Sanders. The DNC and the Clinton campaign needed a cover story.

There already existed in Washington brooding suspicion that Vladimir Putin was working to influence elections in the West. The DNC and the Clinton campaign set out to retrofit that supposition to explain the emails.

On January 16, 2016, a silk-stocking Washington D.C. think tank, The Atlantic Council (remember that name), had issued a dispatch under the banner headline: “US Intelligence Agencies to Investigate Russia’s Infiltration of European Political Parties.”

The lede was concise: “American intelligence agencies are to conduct a major investigation into how the Kremlin is infiltrating political parties in Europe, it can be revealed.”

There followed a series of pull quotes from an article that appeared in the The Telegraph, including that “James Clapper, the US Director of National Intelligence” was investigating whether right wing political movements in Europe were sourced in “Russian meddling.”

The dispatch spoke of “A dossier” that revealed “Russian influence operations” in Europe. This was the first time trippy words like “Russian meddling” and “dossier” would appear together in the American lexicon.

Most importantly, the piece revealed the Obama administration was spying on conservative European political parties. This means, almost necessarily under the Five Eyes Agreement, foreign agents were returning the favor and spying on the Trump campaign.

Blaming Russia would be a handy way to deal with the Podesta emails. The problem was the technologically impossibility of identifying the perpetrator in a phishing scheme. The only way to associate Putin with the emails was circumstantially. The DNC retained CrowdStrike to provide assistance.

On June 12, 2016, WikiLeaks founder Julian Assange announced: “We have upcoming leaks in relation to Hillary Clinton . . . We have emails pending publication.”

Two days later, CrowdStrike fed the Washington Post a story, headlined, “Russian government hackers penetrated DNC, stole opposition research on Trump.”

The improbable tale was that the Russians had hacked the DNC computer servers and got away with some opposition research on Trump. The article quoted CrowdStrike’s chief technology officer and co-founder, Dmitri Alperovitch, who also happens to be a senior fellow at the Atlantic Council.

The next day, a new blog – Guccifer 2.0 – appeared on the internet and announced:

Worldwide known cyber security company CrowdStrike announced that the Democratic National Committee (DNC) servers had been hacked by “sophisticated” hacker groups.

I’m very pleased the company appreciated my skills so highly))) But in fact, it was easy, very easy.

Guccifer may have been the first one who penetrated Hillary Clinton’s and other Democrats’ mail servers. But he certainly wasn’t the last. No wonder any other hacker could easily get access to the DNC’s servers.

Shame on CrowdStrike: Do you think I’ve been in the DNC’s networks for almost a year and saved only 2 documents? Do you really believe it?

Here are just a few docs from many thousands I extracted when hacking into DNC’s network.

Guccifer 2.0 posted hundreds of pages of Trump opposition research allegedly hacked from the DNC and emailed copies to Gawker and The Smoking Gun. In raw form, the opposition research was one of the documents obtained in the Podesta emails, with a notable difference: It was widely reported the document now contained “Russian fingerprints.”

The document had been cut and pasted into a separate Russian Word template that yielded an abundance of Russian “error “messages. In the document’s metadata was the name of the Russian secret police founder, Felix Dzerzhinsky, written in the Russian language. The three-parenthesis formulation from the original post “)))” is the Russian version of a smiley face used commonly on social media. In addition, the blog’s author deliberately used a Russian VPN service visible in its emails even though there would have been many options to hide national affiliation.

CrowdStrike would later test the computers and declare this to be the work of sophisticated Russian spies. Alperovitch described it as, “skilled operational tradecraft.”

There is nothing skilled, though, in ham-handedly disclosing a Russian identity on the internet when trying to hide it. The more reasonable inference is that this was a set-up. It certainly looks like Guccifer 2.0 suddenly appeared in coordination with the Washington Post’s article that appeared the previous day.

THE FRAME UP.

Knowing as we now do that CrowdStrike never corroborated a hack by forensic analysis, the reasonable inference is that somebody was trying to frame Russia. Most likely, the entities that spent three years falsely leading the world to believe that direct evidence of a hack existed – CrowdStrike and the DNC – were the ones involved in the frame-up.

Lending weight to this theory: at the same moment CrowdStrike was raising a false Russian flag, a different entity, Fusion GPS – also paid by the DNC – was inventing a phony dossier that ridiculously connected Trump to Russia.

Somehow, the ruse worked.

Rather than report the content of the incriminating emails, the watchdog press instead reported CrowdStrike’s bad explanation: that Putin-did-it.

Incredibly, Trump was placed on the defensive for email leaks that showed his opponent fixing the primaries.  His campaign chairman, Paul Manafort, was forced to resign because a fake ledger suddenly appeared out of Ukraine connecting him to Russia.

Trump protested by stating the obvious: the federal government has “no idea” who was behind the hacks. The FBI and CIA called him a liar, issuing a “Joint Statement” that cited Guccifer 2.0, suggesting 17 intelligence agencies agree that it was the Russians. 

Hillary Clinton took advantage of this “intelligence assessment” in the October debate to portray Trump as Putin’s stooge”

“We have 17, 17 intelligence agencies, civilian and military who have all concluded that these espionage attacks, these cyber-attacks, come from the highest levels of the Kremlin.  And they are designed to influence our election. I find that deeply disturbing,” said Clinton.

The media’s fact checkers excoriated Trump for lying. This was the ultimate campaign dirty trick: a joint operation by the intelligence agencies and the media against a political candidate. It has since been learned that the “17 intelligence agencies” claptrap was always false.  Those responsible for the exaggeration were James Clapper, James Comey and John Brennan.

Somehow, Trump won anyway.

Those who assert that it is a “conspiracy theory” to say that CrowdStrike would fabricate the results of computer forensic testing to create a false Russian flag should know that it was caught doing exactly that around the time it was inspecting the DNC computers.

On Dec. 22, 2016, CrowdStrike caused an international stir when it claimed to have uncovered evidence that Russians hacked into a Ukrainian artillery computer app to help pro-Russian separatists.

Voice of America later determined the claim was false, and CrowdStrike retracted its finding.

Ukraine’s Ministry of Defense was forced to eat crow and admit that the hacking never happened. If you wanted a computer testing firm to fabricate a Russian hack for political reasons in 2016, CrowdStrike was who you went out and hired.

Perhaps most insidiously, the Obama administration played the phony Russian interference card during the transition to try to end Trump’s presidency before it started. As I wrote in December 2017:

Michael Flynn was indicted for a conversation he had with the Russian ambassador on December 28, 2016, seven weeks after the election.

That was the day after the outgoing president expelled 35 Russian diplomats—including gardeners and chauffeurs—for interfering in the election. Yes, that really happened.

The Obama administration had wiretapped Flynn’s conversation with the ambassador, hoping to find him saying something they could use to support their wild story about collusion.

The outrage, for some reason, is not that an outgoing administration was using wiretaps to listen in on a successor’s transition. It is that Flynn might have signaled to the Russians that the Trump administration would have a different approach to foreign policy.

How dare Trump presume to tell an armed nuclear state to stand down because everyone in Washington was in a state of psychological denial that he was elected?

Let’s establish one thing early here: It is okay for an incoming administration to communicate its foreign policy preferences during a transition even if they differ from the lame duck administration….

….If anything, Flynn was too reserved in his conversation with the Russian ambassador. He should have said, “President-elect Trump believes this Russian collusion thing is a fantasy and these sanctions will be lifted on his first day in office.”

That would have been perfectly legal. It also happens to be what FBI Director Comey and the rest were hoping Flynn would do. They wanted to get a Trump official on tape making an accommodation to the Russians.

The accommodation would then be cited to suggest a quid pro quo that proved the nonexistent collusion. Instead, Flynn was uncharacteristically noncommittal in his conversation with the ambassador. Drat!

They did have a transcript of what he said, though. This is where the tin-pot dictator behavior of Comey is fully displayed. He invited Flynn to be interviewed by the FBI, supposedly about Russian collusion to steal the election.

If you’re Flynn, you say, “Sure, I want to tell you 15 different ways that there was no collusion and when do you want to meet.”

What Flynn did not know was that the purpose of the interview had nothing to do with the election. It would be a test pitting Flynn’s memory against the transcript.

Think about that for a moment. Comey did not need to ask Flynn what was said in the conversation with the ambassador—he had a transcript. The only reason to ask Flynn about it was to cross him up.

That is the politicization of the FBI. It is everything Trump supporters rail against when they implore him to drain the swamp. The inescapable conclusion is that the FBI set a trap for the incoming national security advisor to affect the foreign policy of the newly elected president.

Flynn made the mistake of not being altogether clear about what he had discussed with the ambassador. In his defense, he did not believe he was sitting there to tell the FBI how the Trump administration was dealing with Russia going forward. The conversation was supposed to be about the election.

He certainly did not think the FBI would unmask his comments in a FISA wiretap and compare them to his answers. That would be illegal.

Exhibit 5 to the DOJ’s recent Motion to Dismiss the Flynn indictment confirms the Obama administration’s bad faith in listening in on his conversation with the ambassador. The plotters admit, essentially, that they looked at the transcript to see whether Flynn said anything that caused Russia to stand-down. Had General Flynn promised to lift the sanctions, the Obama administration would have claimed it was the pro quo that went with the quid of Putin’s interference.

After Trump’s inauguration, the FBI and Justice Department launched a special counsel investigation that accepted, as a given, CrowdStrike’s dubious conclusion that Russia had interfered in the election. The only remaining question was whether Trump himself colluded in the interference. There followed a two-year inquiry that did massive political damage to Trump and the movement that put him in office.

Tucker Carlson rightly made Trey Gowdy squirm recently for Republican acquiescence in the shoddy underpinnings of the Russia hoax. It was not only Gowdy, though. Establishment politicians and pundits have been all too willing for years to wallow in fabricated Russian intrigue, at the expense of the Trump presidency.

This perfectly illustrates Republican perfidy: Gifted with undeserved victory in a generational realignment that they were dragged to kicking and screaming, they proceed to question its source and validity. Because if Trump was a product of KGB-esque intrigue, then Hillary was a victim of meddling. Trump was a hapless beneficiary. The deplorables were not only racist losers, they were also Putin’s unwitting stooges.

As I first noted in December 2016, the Washington establishment deliberately set out to fan Russian anxiety to conduct war against the Trump administration. Perhaps it is time to admit that those of us chided as “crazies” who doubted Russian interference – including Trump himself – were right all along.

In the after-action assessment of what went wrong, it should be noted that non-insiders are the ones who have called this from the beginning, in places like here, here, here, here, and here. That is partly what the president means when he Tweets support for his “keyboard warriors.” As Press Secretary Kayleigh McEnany pointed out on Friday, the White House press corps has completely missed the story.

Thank you to all of my great Keyboard Warriors. You are better, and far more brilliant, than anyone on Madison Avenue (Ad Agencies). There is nobody like you!

— Donald J. Trump (@realDonaldTrump) May 15, 2020

This scandal is huge, much bigger than Watergate, and compromising in its resolution is destructive.

If Republicans continue to stupidly concede phony Russian intrigue, the plotters will say they were justified to investigate it.

The recent CrowdStrike testimony drop ended any chance at middle ground. This was a rank political operation and indicting a few FBI agents is not going to resolve anything.

CrowdStrike’s circumstantial evidence that launched this probe is ridiculous. We’ll soon know if the Durham investigation has the will to defy powerful insiders of both parties and say so.