Google says many people ask this question so here is the correct answer: polar bears are not going extinct.
If you have been told that, you have misunderstood or have been misinformed. Polar bears are well-distributed across their available habitat and population numbers are high (officially 22,000-31,000 at 2015 but likely closer to 26,000-58,000 at 2018): these are features of a healthy, thriving species.
‘Why are polar bears going extinct?’ contains a false premise – there is no need to ask ‘why’ when the ‘polar bears [are] going extinct’ part is not true.
It is true that in 2007, it was predicted that polar bear numbers would plummet when summer sea ice declined to 42% of 1979 levels for 8 out of 10 years (anticipated to occur by 2050) and extinct or nearly so by 2100 (Amstrup et al. 2007). However, summer sea ice has been at ‘mid-century-like’ levels since 2007 (with year to year variation, see NOAA ice chart below) yet polar bear numbers have increased since 2005. The anticipated disaster did not occur but many people still believe it did because the media and some researchers still give that impression.
Examine the evidence and you will see that claims of polar bears going extinct are simply not true. So far, the response of polar bears to recent ice loss suggests that they will continue to thrive with even less summer ice than there has been in recent years as long as ice in winter (December-March) and spring (April-June) remains reasonably abundant, as has been the case to date. The most recent information available is summarized in the upcoming State of the Polar Bear Report 2019, to be released 27 February 2020 but see also the 2018 report (Crockford 2019b).
The graph below was constructed by NASA sea ice expert Walt Meier and published by the US National Snow and Ice Data Center in early October 2019. It shows clearly that summer sea ice (measured as the average for September) has not declined further since 2007 but has had a flat trend.
The graph below is from my book and shows the growth of global polar bear numbers since the 1960s.
The final estimate 26,000-58,000 or 39,000 average) is my plausible and scientifically defensible ‘best guess’ based on extrapolation of recent survey results, summarized here and explained in detail in my book.
FOOTNOTE
One of Google’s top ‘suggestion’ when I search for the term ‘polar bear’ is a list of questions that people supposedly ask the most (‘People also ask’), including ‘Why are polar bears going extinct?’
The ‘answer’ provided is not an actual answer but a statement from WWF, an multi-national organization financially invested in promoting the idea that polar bears are suffering due to declining sea ice: it’s paid Google advertising meant to look like answers and facts:
‘Because of ongoing and potential loss of their sea ice habitat resulting from climate change, polar bears were listed as a threatened species in the US under the Endangered Species Act in May 2008. The survival and the protection of the polar bear habitat are urgent issues for WWF.’
Note the statement misleadingly says ‘sea ice’ when it really means ‘summer sea ice’ – the predictions of potential polar bear population decline were based exclusively on summer ice (Amstrup et al. 2007; Crockford 2017, 2019).
As I said above, ‘Why are polar bears going extinct?’ contains a false premise – there is no need to ask ‘why’, when the ‘polar bears [are] going extinct’ part is not true. This post is for the people who search the internet thinking that polar bears really are going extinct.
Another question Google offers is: ‘How many polar bears are left?’ Answer [my bold]:
‘In fact, the World Wide Fund for Nature (or WWF) estimates that there are only22,000 to 31,000 polar bears left in the world. Jan 25, 2019’
Only?This global estimate, provided by the IUCN Red List (not the WWF) means there are almost three times more polar bears than the 10,000 or so there were in 1960 (Regehr et al. 2016; Wiig et al. 2015). But the Red List figure includes out-of-date estimates and low-balled guesses for many of the 19 subpopulations and my book (Crockford 2019) explains why this 2015 estimate sanctioned by the IUCN was almost certainly too low.
Greece Sends 50 Naval Vessels & Commandos To Block Refugee Wave Out Of Turkey
Greece sealed its key land Kastanies border crossing with Turkey Friday after Ankara declared it’s allowing refugees to flee Idlib and on to Europe for at least 72 hours, in response to Syrian-Russian airstrikes killing 33 Turkish troops Thursday.
Germany’s Bild newspaper reported Friday that Greece is taking further emergency measures to prevent Erdogan from effectively “opening the gates” on new waves of refugee and migrant hordes seeking entry to the EU, noting the country “completely closed off its borders with Turkey: not just for refugees, but for EVERYONE.”
The newspaper said 50 naval ships, likely most of them small patrol vessels, have been deployed by the Hellenic Navy to ensure those coming out of Turkey don’t get through.
Hellenic Navy file image
Citing a top Greek government official, Bild reported further this will include air support.
“According to BILD information, the government sent 50 warships to the Greek islands to protect the EU’s external borders,” the German tabloid said. “Ten helicopters are also supposed to secure the transitions to Turkey on land.”
Greece’s Ekathimerini newspaper said military commandos were being sent to key crossings following an emergency meeting of key government officials Friday to deal with the crisis:
Patrols along the land and river border in northeastern Evros have been bolstered since Friday morning, when the first large groups of migrants began to arrive following an announcement on Thursday night by a Turkish government official saying that Ankara would no longer try to prevent Syrians fleeing war in their country from attempting the crossing to the European Union.
The army has also dispatched two commando units to help the Hellenic Police guards at the border, and particularly to patrol the more dangerous sections of the Evros River.
Turkish TVs broadcast footages showing migrants are boarding boats off Turkish coast, departing to Greek islands pic.twitter.com/YLMEM1lCMk
And The Guardian reported further early Friday: “Hundreds of Syrian refugees in Turkey have begun preparing to travel towards the country’s borders with Greece and Bulgaria after Ankara’s sudden decision to no longer impede their passage to Europe.”
“Turkish police, coastguard and border security officials were ordered to stand down overnight on Thursday, Turkish officials briefed reporters,” the report added.
Bild: Greece uses tear gas against refugees at the Pazarkule border crossing Photo. Image: Anadolu Agency via Getty Images
As European officials mull whether this is but more of Erdogan’s threats or perhaps an early “taste” of what’s to come, or whether the flood has begun, Bulgaria has begun taking extra security action as well, bolstering patrols along border areas with Turkey
Greek Prime Minister Kyriakos Mitsotakis vowed that“no illegal entries into Greece will be tolerated” – noting greatly tightened security along the EU’s external borders.
Turkey’s communications director Fahrettin Altun had earlier said Turkey had “no choice” but to relax border controls after its pleas for greater European help in assisting with the over 3 million refugees on its territory went unheeded.
However, Foreign Minister Mevlut Cavusoglu sought to downplay new reports of Turkey encouraging refugees exit toward Europe, saying Turkey’s policy hasn’t changed. But footage coming out of Turkey and the Greece-Turkey main crossing throughout Friday speaks otherwise.
Now that Bernie Sanders has been informed that the Kremlin is trying to support him (whether he likes it or not) he has officially become a viable candidate who may actually desire to make real systemic change. In a way the Russia connection accusation can now be worn as a badge of honour by Gabbard and Trump due to them truly being a limited threat to the status quo. Sanders got a gentler version of this form of Deep State virtue signaling by just being told that Russians are pushing for him on their own, meaning that there “may be hope for him yet” to turn around and jump right back on the Beltway bandwagon. Ultimately, the #Russiagate tactic did not disway voters from electing Trump but it did eat up a massive amount of his precious time/resources as US President and put an invisible Iron Curtain between any possible positive cooperation between America and Russia. This “collusion” revelation of dubious validity for Sanders will probably have a similar impact on his campaign and possible time in the Oval Office as it did with Trump, but regardless he is the only chance the Democrats have of winning in 2020.
Democratic and Republican voters are obviously different in their beliefs falling onto one of two different sides of every wedge issue, but one thing unites all American voters – no one actually cares about Russia or really any foreign power. Over the last 6 months, less than 0.5% of Americans said their primary concern was “Situation with Russia” based on polling by Gallup. (Gallop lists all concerns with a tiny response at 0.5% meaning that literally one person could have listed this as their big issue and it would be rounded up to half a percent). If we then take a look at the biggest concerns that Americans do have, then not surprisingly it is things like the economy, healthcare, government/poor leadership, immigration, poverty and surprisingly unifying the country.
This has been a consistent fact for decades, the American voter is vastly more concerned about things that affect them personally than some greater threat or ideological goal. America is a society of individualists so naturally most people’s demands from power are based their own individual needs. There is nothing surprising here, except for the desire to “unify the country” which has not been a priority in previous years.
Photo: Bernie speaks to youth better than men half his age
Perhaps some people in the Beltway are concerned with Russia, but the voting masses are not and the narrative that “Bernie is getting help from Moscow, but then again he didn’t ask for it and is not involved” is very weak sauce. This will not dissuade any real large number of people away from voting for him as the Democratic Candidate.
What Sanders offered in 2016 that got crushed by inner Democratic Party moves and Hillary Clinton is still fresh and relevant today – “Free” Stuff and cutesy poo Socialism. Just like last time the only hope the Dems have is the man from Vermont with the thick New York accent as all the other candidates are dismal offerings to the public. Sanders’ position is what a large portion of the population wants. Is it viable and can Sanders actually do it? These questions do not matter as the average voter does not think about them, they want their college debt annulled and medical care guaranteed and who cares how it gets done. Sanders promises this clearly and bluntly while the others are too busy looking at percentages from focus group reactions to shift their image from day-to-day. Bernie is really the only choice for the Democrats to compete with Trump.
Graphic: A simple message that is deeply relevant to Americans is what gets votes
Biden managed to throw away all the years of positive brand recognition that he had attained thanks to standing next to Barack Obama by allowing #Russiagate to meltdown into #Ukrainegate expositing his corrupt dealings in America’s newest colony. Additionally there are lots of videos of Biden inappropriately touching children, which is far more important from an electoral standpoint. Biden had it and lost it.
Tulsi Gabbard as a female veteran (who doesn’t look White) should have gotten the Left excited, but instead they trounced her as she seemed unwilling to play ball. Yang has one idea (Universal Basic Income) and the complete lack of personality needed to push it. Elizabeth Warren has all the problems of Hillary Clinton while still managing to have less humanity on camera. Stuffy anti-gun nut Buttigieg will probably give the Republicans the largest amount of minority votes seen during our lifetimes. Bloomberg is a boring version of Trump who seems to be obviously trying to buy his way into the election, which will ultimately backfire. Who is this Amy Klobuchar woman and how did she actually get a tiny amount of delegates? Bernie’s competition is a joke.
Sanders, despite being the old rich bald White guy the Left claims to loath, is head and shoulders above anyone else in terms of his ability to deliver a message and get a positive reaction out of people. Basically, he has the showmanship and the ability to relate to people well enough to get the youth and minority vote. Most of all, he promises free stuff that he is going to tax us for which is the naive instant gratification solution that the masses want. The entire country has brutal college debt and the fear of life-crushing medical debt. Even though Sanders has almost zero chance of actually getting Scandinavian Style Socialized Medicine or a Student Loan Amnesty accomplished, just the promise alone is very tempting. When faced with the option of possibly getting tens of thousand of dollars of debt cancelled vs. a 0% chance of that happening with Trump, well you can see whom debt ridden Americans will be casting their ballots for.
Yang’s Universal Basic Income also speaks to the millions of voices fighting to get from paycheck to paycheck but he was unable to deliver it. Sanders has the charisma and the big pleasant sounding simple solutions that the common man will buy into. If the Democrats again somehow try to sabotage Bernie, then they will be the ones feeling the “Bern” as they will be utterly crushed by Trump, allowing the Republican party to continue its transformation from the perception of a pro-business party to one of a multi-racial pro-Constitutional populist party. The DNC can either back someone they don’t like or shoot themselves in the foot, but judging by their overall irrational political views and emotion driven logic they are probably already trying to put the “magazine” in the revolver as we speak.
New Study Shows Average U.S. Worker Needs 53 Weeks In A Year Just To Earn “Middle Class” Lifestyle
A new study by Oren Cass at the Manhattan Institute confirms that a 52 week year just doesn’t cut it for the average American worker looking to simply make a “middle-class” life for themselves. For women, the news is even worse: it requires 66 weeks to earn a middle class lifestyle.
These figures compare wildly to 1985, when males at the median weekly wage needed to work only 30 weeks and women only needed to work 45 weeks, according to Bloomberg.
The paper tried to compile a “cost of thriving” index for the purposes of gauging quality of life. The “middle class” is defined as a 3 bedroom house just below the mid range of market prices, family health insurance, costs associated with a vehicle and a semester at public college.
The study’s author, Oren Cass, is a former adviser to Mitt Romney’s 2012 presidential campaign. He says that while his index is imperfect and it doesn’t account for wide cost and income difference, it’s a “starting point”. It also doesn’t account for larger houses, advances in medicine and safer cars.
Cass introduces the problem by saying: “A dramatic divergence between data and experience is confounding America’s policy debates. The data seem to show that households have attained unprecedented prosperity, and wages have (at worst) held their own against inflation, or (at best) risen much faster than prices. By conventional measures, material living standards everywhere in the income distribution are at all-time highs, and technological progress continues to improve them.”
He continues: “Yet many jobs able to support a family in the past no longer do. Millennials are in worse financial shape than were those of Generation X at the same age, who themselves had fallen behind the baby boomers. The stories appear irreconcilable.”
Cass thrashes the case that quality of life has improved enough to outpace inflation and the widening inequality gap. He says workers don’t always have the option to substitute worse, but cheaper, goods if their incomes aren’t rising fast enough to afford newer and better products.
He also found that only incomes among men holding Bachelor’s degrees have risen more than consumer prices since 1980.
Cass concludes: “The explanation is this: inflation does not measure affordability. Key assumptions built in to inflation indexes for the purpose of measuring the underlying, economy-wide upward pressure on prices are different from, and often counter to, the key assumptions necessary for assessing the economic choices and constraints faced by households. When analysts use inflation adjustments to compare household resources over time, they have chosen the wrong vantage point, and their view is obscured.”
His study also concludes that economists and families see three things differently:
Quality Adjustment. Products and services that rise substantially in price but in proportion to measured quality improvements can become unaffordable, while having no effect on inflation.
Risk-Sharing. New products and services can increase costs for the entire population yet deliver benefits to only a very small share, while having no effect on inflation.
Social Norms. Society-wide changes in behaviors and expectations can alter the value or necessity of a good or service, while having no effect on inflation.
A lot of folks have distrusted the numbers coming out of China since the very beginning of the coronavirus outbreak. That uneasy feeling was justified when it was discovered that many patients weren’t being counted because they were never tested. Once an alternative testing method was temporarily approved, the number of infected people skyrocketed. This was only temporary though because Chinese officials reverted quickly to their previous method of only relying on the nucleic acid test, which is infamous for false negatives. (There are reports that suggest certain infected people tested negative as many as six times before a positive test occurred, according to MedicineNet.)
Looking at China’s official response and looking at the American official response, I see some troubling similarities that make me wonder if our own numbers are accurate at all.
Hardly anyone is actually being tested in the United States.
First of all, very few tests have actually been performed in the United States. As of Feb. 26, 2020, the CDC reported that only 466 tests had been performed in the US and the criteria for being tested is so narrow as to render the statistics useless.
This was proven to be the case with the patient in California who was finally tested after four days and found to have Covid19, even though she has not been to China or knowingly been in contact with anyone from China. Why wasn’t she tested sooner?
Because she didn’t fit “the criteria” laid out by the CDC for testing.
Hospital administrators said they immediately requested diagnostic testing from the Centers for Disease Control and Prevention, but the procedure was not carried out because the case did not qualify under strict federal criteria: She had not traveled to China and had not been in contact with anyone known to be infected. (source)
So this delay in testing was not the fault of physicians caring for her, but because the CDC decided from afar that only certain patients could be tested. If this sounds familiar, it’s because, in China, only certain patients were given tests while thousands of others were turned away from healthcare facilities without assessment.
Here’s the narrow criteria to get tested. Basically, if you haven’t been to an affected country or been exposed to someone from an affected country, you’re unlikely to be tested.
And it gets even worse.
The first batch of tests sent out to health departments around the country was faulty.
…expanded testing has been delayed because of an unspecified problem with one of the compounds used in the CDC test. About half of state labs got inconclusive results when using the compound, so the CDC said it would make a new version and redistribute it. (source)
So 466 people have been tested with potentially flawed tests. Countless people have been untested simply because they haven’t traveled to certain countries or knowingly been in contact with someone who has traveled to certain countries.
In comparison, New York Magazine reports that more than 7,100 coronavirus tests have been conducted in the UK, South Korea has tested more than 30,000 people in “drive-thru” testing facilities, and the province of Ontario, Canada has tested 629 people. All of these places have far lower populations than the United States but they’ve tested a lot more people.
We were all upset when we learned China was testing so few people and fudging the cause of death of others. But here we are, also testing very few people.
What about all those people being “monitored?”
You’ve probably seen that thousands of people across the country are being “monitored” by health departments. Unfortunately, that monitoring doesn’t mean that they’re being tested before they’re released from self-quarantine. It simply means the local health department is getting their temperatures and asking if they have symptoms.
So monitoring is mainly self-instituted and no testing is being done. Don’t be lulled into any sense of false security over “monitoring.” Actual monitoring would mean that the quarantined people would have to test negative to the virus before they were released from quarantine.
To be absolutely clear, those being “monitored” are basically staying home for a couple of weeks then going on their merry way, with no testing involved. And considering there have been instances of asymptomatic people spreading the virus, this is hardly comforting.
And now Vice President Pence has issued a gag order.
If the obfuscation above isn’t bad enough, now all statements from health officials must be cleared by Vice President Mike Pence, the unofficial Covid19 Czar, before they can be made public.
The vice president’s first move appeared to be aimed at preventing the kind of contradictory statements from White House officials and top government health officials that have plagued the administration’s response. Even during his news conference Wednesday, Trump rejected the assessment from a top health official that it was inevitable that the coronavirus would spread more broadly inside the United States.
Dr. Anthony Fauci, one of the country’s leading experts on viruses and the director of the National Institute of Allergy and Infections Diseases, told associates that the White House had instructed him not to say anything else without clearance. (source)
So not only is the US government restricted who can be tested, sending out faulty tests, and poorly managing the diagnostic process, they’re also filtering any further information the American people are allowed to get. All those warnings last week about how we could expect “severe disruptions” to our daily lives? The talk about potential quarantines and getting prepared to work and educate from home?
It looks like those may be the only warnings we get.
Remember how just weeks ago we were talking about the horrible dishonesty and subterfuge in China’s handling of the Covid19 outbreak? It kind of seems like deja vu but right here in America.
This goes right along with the Ebola crisis management playbook.
I’ve mentioned before about how the Ebola outbreak completely vanished from the news, and it looks like we’re watching exactly the same thing play out now with VP Pence in charge. Just a few days ago, I wrote:
The government prefers to “manage” the flow of information, as they did during the Ebola outbreak in 2014, when they instituted an outright blackout on information.
That information blackout was a little bit different, as it was aimed toward the media. In Cat Ellis’s book, The Wuhan Coronavirus Survival Manual, she wrote that the editors of mainstream media outlets were told by the President to stop reporting on it.
To counter the rising public tension, President Obama appointed Ron Klaine, a Fannie Mae lobbyist with no health care background at all as his Ebola Response Coordinator. Klaine was known in and around Washington DC as being a man who could circumnavigate government bureaucracy and regulations. The media referred to Klaine as Obama’s “Ebola Czar”.
Within weeks of Klaine’s appointment, the Associated Press released a statement that was sent to editors. There were to be no more stories on Ebola unless it is linked to a massive upset or delay. All stories about suspected cases disappeared from the mainstream television news coverage, although you could still find articles on their websites occasionally.
So, if it is a standard for governments to downplay the severity of an infectious disease in order to control public panic, it is reasonable to examine what we know and understand that the situation is likely worse than it appears to be. (source)
Heaven knows, President Trump isn’t exactly popular with the media, which explains why the tactic this time is different and aimed at people who answer directly to the government. The tactic may be different but the strategy itself is the same.
In his recent press conference about the coronavirus, the President repeatedly compared Covid19 to the flu, when the two viruses are hardly comparable. He downplayed concerns and recommended more handwashing (which, while good advice, is hardly sufficient for an illness that is so highly contagious.)
Why would the government hide the severity of Covid19?
Of course, any government would want to avoid a panic. When people panic, things can devolve very quickly as Selco has warned. But is that the only reason they’re downplaying the spread of the virus?
As with most things when powerful people are involved, we can probably follow the money.
The market has been in a freefall and as Michael Snyder writes, it’s doing things we’ve never seen before, including yesterday’s plummet that was “the largest single-day point decline in all of U.S. history.”
Without a doubt, stocks could potentially fall a long, long way. Thanks to a tremendous rally earlier this year, stock prices were pushed to the most overvalued levels that we have ever seen. It was inevitable that prices would fall, and this coronavirus outbreak looks like it could greatly accelerate that process.
Meanwhile, analysts are increasingly coming to the realization that this virus is going to have very serious implications for the entire global economy.
…Up until recently, Wall Street had been acting as if this was a temporary problem that would soon fade.
But now it has become clear that we will be battling this virus for many months to come.
And what happens if this crisis is like the Spanish Flu pandemic which lasted for three years? (source)
So perhaps the biggest reason for all the secrecy and lack of testing is economic.
Chief of Staff Mick Mulvaney had some outrageous suggestions when he spoke with reporters in an attempt to assuage fears about the administration’s handling of the Covid19 outbreak. Here are the key points he made.
White House chief of staff Mick Mulvaney on Friday suggested that Americans should ignore media reports about the coronavirus amid fears of the deadly disease spreading into the U.S.
Mulvaney claimed that the media has only started paying close attention to the coronavirus because “they think this is going to be what brings down the president.”
Mulvaney said he was asked by a reporter, “What are you going to do today to calm the markets?” “I’m like, ‘Really what I might do today [to] calm the markets is tell people turn their televisions off for 24 hours.’” (source)
And of course, the inevitable flu comparison.
“This is not Ebola … it’s not SARS, it’s not MERS,” Mulvaney said. “We sit there and watch the markets and there’s this huge panic and it’s like, why isn’t there this huge panic every single year over flu?” Mulvaney asked rhetorically. (source)
So, don’t worry. Just ignore the news. Keep going to work, spending money, and thinking happy thoughts.
Should we be concerned?
So, given that the President, the Vice President, and the White House Chief of Staff say this is no big deal, and that the CDC is hardly allowing the testing of anyone, should we still be concerned about the possibility of widespread illness and quarantines?
Personally, I’m even more concerned. Why would they go to such lengths to silence health officials? Why would testing and reporting be so shady?
If it gets to the point where information can no longer be hidden and a mandatory quarantine is announced, it’s going to be too late to get the food and supplies you need to hunker down for an indefinite period of time.
With the new gag order on health officials, don’t expect for a moment to get information of value before it’s too late to act on it.
I think we’re watching a desperate coverup to try and save the plummeting economy. I think there are likely to be far more infections in the United States than anybody knows about because so few people meet the criteria for testing. I think that is deliberate.
I do not trust the official numbers in the United States. Do you?
About Daisy
Daisy Luther is a coffee-swigging, globe-trotting blogger who writes about current events, preparedness, frugality, voluntaryism, and the pursuit of liberty on her website, The Organic Prepper. She is widely republished across alternative media and she curates all the most important news links on her aggregate site, PreppersDailyNews.com. Daisy is the best-selling author of 4 books and runs a small digital publishing company. You can find her on Facebook, Pinterest, and Twitter.
First Credit, Now The Corona-Crash Is Freezing Equity Market Issuance
On the heels of global credit markets grinding to a halt this week as the Covid-19 outbreak, it appears the freeze has spread to equity markets as Bloomberg reportsmore than $650 million in IPOs to be pulled from European capital markets.
As we detailed previously, high yield and investment-grade spreads have surged this week, illustrating the stress permeating underneath markets.
In fact, high yield spreads have widened +117bps in a matter of days, the biggest move since the financial crisis.
And now that chaotic chill is rolling over to the equity market, as Bloomberg notes DRI Healthcare was the second company in days to pull a new listing in Europe, citing deteriorating market conditions driven by virus fear.
“The company [ DRI Healthcare Plc] is seeking to raise as much as $350 million in London. Raising equity capital in Europe was already tricky because of a growing disconnect between buyers’ and sellers’ valuation expectations. Now the market’s slump is making investors even more averse to risk, thinning out an already depleted pipeline,” said Bloomberg.
DRI, a fund that invests in rights to royalty-paying pharmaceuticals, didn’t set a new date for its initial public offering, which had been planned for March 11.
Somewhat stunningly, only 10 companies have priced IPOs in Europe this year, including three in London, as raising equity capital in Europe was already tricky because of a growing disconnect between buyers’ and sellers’ valuation expectations, and now the surge in risk is keeping investors even further away.
“If the selloff continues into next week, no one will want to price with that level of weakness in the market,” said Marco Schwartz, head of KPMG’s equity capital markets advisory team.
“Our advice to companies about to launch offerings would be to hold off and wait.“
Sustainable Farmland Income Trust Plc was another company this week that pulled its $300 million planned listing on the London exchange, citing market turbulence.
The IPO of Wintershall DEA, an oil and gas firm, was also postponed and could wait until the second half of the year to list.
Nacon SA, a French maker of computer parts, managed to price a $128.2 million IPO this week, despite increasing volatility in global equity markets.
With central bankers seemingly impotent in the face of a health crisis (unable print vaccines and powerless to do anything that will help restart global supply chains or consumption), the sudden velocity of Covid-19’s effect on global markets has been nothing short of astonishing and while secondary trading markets are important, contagion spreading to the primary markets, freezing IPO and credit issuance this week is a significant problem.
Are you ready for this week’s absurdity? Here’s our Friday roll-up of the most ridiculous stories from around the world that are threats to your liberty, your finances, and your prosperity.
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Man fined almost $7 million for painting his own property
In 2002, the owner of some dilapidated warehouses in New York City decided to make use of the property.
He hired an artist to decorate the warehouses with graffiti, and curate graffiti art from others. Soon it became a bustling art hub, with artists renting out space to do their work.
But after eleven years, the owner decided to demolish the warehouses to make way for luxury apartments.
That’s when the artists sued to protect ‘their’ graffiti.
But the owner of the property went ahead and whitewashed the artwork while the lawsuit was ongoing.
After years of legal battles, the court sided with the artists and demanded the owner pay $6.75 million to the artists whose work he destroyed. And now on appeal, another court affirmed that decision.
Turns out, you don’t have the same property rights when it comes to art.
New York has a Visual Artists Rights Act. It doesn’t matter who owns the art, or the building it’s affixed to. Artists still maintain certain rights to their work, even if it is sold (or they never owned the canvass).
So in New York, you better be careful who you let decorate your property. It may become their property.
Now California will refer to “at risk youth” instead as, “at promise youth.”
Legislation went into effect at the beginning of this year which changed the state’s legal term for children at risk of entering the criminal justice system.
The point is to change the negative connotation of the phrase “at risk”.
Uplifting, right? But these people always fail to understand that changing words doesn’t change reality.
Progessive parking tickets could make rich pay more
Boston Massachusetts tickets drivers as much as $40 for an expired parking meter.
Boston collected over $61 million worth of fines in 2018, the same year it began increasing parking fines. Now some parking tickets run up to $120.
But a new city councillor is concerned that some Boston residents may have to decide between paying a parking ticket, and putting food on the table.
She has introduced rules that would scale the cost of a parking ticket based on the violator’s income.
So rich people will still face huge fines for tiny infractions– maybe even higher than they are currently. But low-income folks will pay lower fines for parking illegally.
The proposal says, “for some a $40 parking ticket is simply the cost to park illegally while for others it is a major financial setback.”
So, as usual, the solution is to redistribute the wealth.
“From each according to his means,” to pay parking tickets, as Karl Marx would say.
Calling The Top: Record Numbers Of CEOs Quit In January
CEO departures like that of Bob Iger from Disney have stunned the investing world recently. Iger said earlier this week that he was going to step down from his job after a decade and a half of success.
He was responsible for bringing Disney into the streaming era, creating Disney +, launching the company’s biggest theme park in Shangai and bringing ESPN to streaming, according to Axios.
Could Iger – and other CEOs like him – be sounding the alarm? While Iger claimed on Disney’s conference call that the “plans had been in the works for some time,” it is difficult not to notice the timing with which he – and other CEOs like him – have decided to call it quits.
In fact, their timing has been extraordinarily prescient. Every CEO that has announced their departure before the coronavirus pandemic that has taken a hold of the global markets may have just arguably exited at the best possible time. Since the beginning of January, $5 trillion has now been wiped off of markets worldwide.
And there’s plenty of reason to believe that the pain is going to continue.
219 CEOs have left their jobs in January, which is a 37% increase from December and 27% increase from the previous high, which was in October.
Even in December, the breakneck pace with which CEOs were leaving was highlighted by Axios, who noted that names like Patrick Byrne of Overstock, Kevin Plank of Under Armor and Adam Neumann of WeWork had all stepped down from their positions as Chief Executive Officer.
Additionally, the #MeToo movement claimed names like Steve Easterbrook of McDonald’s.
Since 1958 the S&P 500 has declined by +5% in a day some 22 times. In 82% of those events, stocks were already oversold. Outside the Financial Crisis, the average 3-month return after a crash is +8.5%, with only 1 significant (11%) drawdown. From the first 5% down day of the Financial Crisis (which had 12 5% days), 1-year returns were still essentially flat. Bottom line: markets right now are vulnerable to a crash. Be ready to at least stick a toe in the water if that happens.
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“Markets don’t crash when they’re overbought… they crash when they’re already oversold.” I first heard that bit of wisdom in 2000 from a trader at SAC Capital who went by the name of “Spider”. Yes, he was a wiry sort of fellow, but his nom du guerre came from his adeptness at trading SPY.
Given current market conditions, we’ll dedicate Story Time Thursday to his quip and analyze both how true it is and whether we can make money buying crashes.
First, we need to define what a “Crash” even is and for that we’ll use 1-day return data for the S&P 500 back to its 1958 inception:
On average the S&P rises by 0.03% a day.
The standard deviation of those daily returns is 0.98%, which incidentally is why Jessica uses 1% days as our basic measure of US equity market volatility.
In the scientific community an observation of 5-standard deviations is one widely accepted benchmark of statistical robustness. It was, for example, the metric used to announce the discovery of the Higgs Boson particle.
That makes a 5% (4.89%, if you want to be precise) 1-day decline in the S&P a legitimately unusual observation, along with any 5% (4.95%) 1-day upside move.
This math explains why statistically minded investors think of equity returns as having “fat tails” rather than those defined by a normal distribution:
The odds of a 5-standard deviation move are about 1 in 3.5 million.
And yet, since 1958 (15,647 trading days) there have been a total of 39 days with +5% moves: 17 positive, and 22 negative.
The bottom line is that a 5% decline is a good definition of a “Crash”, so let’s look at all the instances where that has occurred and what was happening around/after those events:
#1: October 19 1987, a 20.5% decline:
US stocks had been on a tear from January – September 1987, up 33% YTD through the end of the month and hitting fresh all-time highs in the process.
The S&P 500 then hit a wall in October, declining by 12.2% from the 1st through 16th.
If you bought the close and held for 3 months you saw a 12.1% gain.
Conclusion: this is undoubtedly the source of the “crash from oversold” aphorism, and buying the drop netted a very good short-term return.
#2: September 2008 – January 2009:
During the depths of the Financial Crisis the S&P 500 had a +5% drop on 12 days, the largest cluster in the 1958 – present data.
The first instance was on September 29, 2008 with an 8.8% decline. Month-to-date returns prior to that day were -5.7% and -17.7% YTD.
So yes – that first “Crash” of the Financial Crisis came during already rough market conditions. But, unlike buying the close of the 1987 Crash, holding 3 months after the September 2008 crash delivered a -21.4% return. Holding for a year did get you to essentially break even (-4% price return, +3% dividend payout), however.
The reason for that disappointing “buy the crash return”: 11 other 5% crashes over the next 4 months. The last one wasn’t until January 20, 2009.
Conclusion: crashes can cluster, and it can take a year (and a lot of volatility) to recoup a “buy the crash” purchase.
#3: Finally, here is a list of the other 9 crashes back to 1958 and the details around them:
October 26, 1987: -8.3%, from obviously still oversold conditions post Black Monday. The 3-month future return from the close was +9.6%.
October 27, 1997: -6.9%, NOT in a clearly oversold market since the S&P was only down 0.6% MTD. The 3-month future return: +10.5%.
August 31, 1998: -6.8%, from an oversold S&P 500 down 8.3% MTD. The 3-month future return: +21.6%.
January 8, 1988: -6.8%, but NOT from clearly oversold conditions (MTD +4.8%, 1-month +12.3%). The 3-month future return: +9.4%.
May 28, 1962: -6.7%, from an oversold market down 7.1% MTD. The 3-month future return: +5.9%.
August 8, 2011: -6.7%, from clearly oversold conditions (-7.2% MTD, 1-month -10.4%). The 3-month future return: +14.0%.
October 13, 1989: -6.1%, NOT from an already oversold market (+1.8% MTD, 1-month +1.9%). The 3-month future return: +1.0%.
April 14, 2000: -5.8%, from a market JUST entering oversold from the start of the dot com bubble bursting (-3.8% MTD, but 1-month +6.0%). The 3-month future return: +11.3%.
October 16, 1987: -5.2%, from oversold conditions as noted in Point #1 above. Because of Black Monday, the forward 3-month return from this close was -10.8%.
Now, let’s aggregate this data and draw some conclusions:
In 18 of the 22 cases here (82%), the S&P 500 did drop by 5% in a day (our “Crash” definition) after already experiencing significant losses.
Trading myth confirmed: markets crash when already under significant duress.
Outside of the 2008 – 2009 Financial Crisis, if you bought the close of a down 5% day you made an average of 8.46% over the next 3 calendar months with 90% of those instances yielding positive returns. The only exception, but still notable, was October 16th 1987.
Looking just at the 2008 – 2009 experience, buying the first down 5% move on September 29th was not a great idea, but if you had the fortitude to stick with it you were at least whole in a year.
So, let’s move this discussion to the present day: what if we get a 5% crash day as a result of concerns about COVID-19’s effect on the global economy? Two final thoughts:
History says buy that close and the data is crystal clear on that point. Crashes are opportunities to make solid 3-month returns with little risk of further cataclysmic drawdowns.
If you think COVID-19 bears closer resemblance to the 2008 Financial Crisis than a “garden variety” crash, then history says to buy the first down 5% close in small size and wait for more to add to positions.
Bottom line: we’re going into a Friday-Monday sequence that will remind many old hands of 1987 and 2008 – 2009, so let’s be prepared for the possibility of a down 5% day and stay clear headed about what to do next.
Coronavirus Reappearing Weeks Later In Discharged Patients
An alarming number of coronavirus patients in China and around the world are testing positive after ‘recovering’ and being discharged from the hospital – with the disease reappearing weeks later in some cases, according to Reuters.
On Wednesday, Japan’s Osaka prefectural government revealed that a female tour-bus guide had tested positive for coronavirus for a second time – which comes on the heels of Chinese reports that discharged patients throughout the country were testing positive after their release from the hospital.
That said, China’s National Health Commission said on Friday that reinfected patients were not transmitting the disease to others. The two running theories is that COVID-19 is “biphasic” and lies dormant before reappearing, or that patients are not building sufficient antibodies to fight a new infection.
Experts say there are several ways discharged patients could fall ill with the virus again. Convalescing patients might not build up enough antibodies to develop immunity to SARS-CoV-2, and are being infected again. The virus also could be “biphasic”, meaning it lies dormant before creating new symptoms.
But some of the first cases of “reinfection” in China have been attributed to testing discrepancies.
On Feb. 21, a discharged patient in the southwestern Chinese city of Chengdu was readmitted 10 days after being discharged when a follow-up test came back positive. –Reuters
Deputy director of the infectious diseases center at the West China Hospital, Lei Xuezhong, told People’s Daily that hospitals had been using nose and throat samples to test patients, while new tests were finding the virus in the lower respiratory tract.
A study by the Journal of the American Medical Association which analyzed four infected medical personnel treated in Wuhan found that it was likely that some recovered patients would remain carriers even after meeting discharge criteria.
In China, for instance, patients must test negative, show no symptoms and have no abnormalities on X-rays before they are discharged.
Allen Cheng, professor of infectious diseases epidemiology at Monash University in Melbourne, said it wasn’t clear whether the patients were re-infected or had remained “persistently positive” after their symptoms disappeared. But he said the details of the Japan case suggested the patient had been reinfected.
Song Tie, vice director of the local disease control center in southern China’s Guangdong province, told a media briefing on Wednesday that as many as 14% of discharged patients in the province have tested positive again and had returned to hospitals for observation.
He said one good sign is that none of those patients appear to have infected anyone else.
“From this understanding … after someone has been infected by this kind of virus, he will produce antibodies, and after these antibodies are produced, he won’t be contagious,” he said. –Reuters
Meanwhile, a “low level” of the virus was found in the pet dog of a patient in Hong Kong, throwing a “weak positive” when tested.
Typically patients will develop specific antibodies which will protect them from reinfection, however this does not appear to be the case with a certain percentage of coronavirus patients, similar to HIV.
“In most cases though, because their body has developed an immune response to the first infection, the second infection is usually less severe,” said Adam Kamradt-Scott, an infectious diseases specialist at the University of Sydney.
Other experts have suggested that the disease may even feature “antibody-dependent enhancement,” meaning that exposure to viruses could make patients more at risk of further infections and worse symptoms.
This confirms a report from several weeks ago from the Taiwan Times that reinfection may be deadlier than the initial infection in some patients, causing sudden death from heart failure in several instances.
