Tag: news

As cruise lines bitch about potentially being excluded from the US government bailouts passed as part of the US CARES act, one cruise ship owned by a Dutch company has reported some of the worst news we’ve heard aboard a cruise ship since the Diamond Princess departed Yokohama.

On Friday, Holland America Line announced that four passengers had died aboard its cruise ship, the Zaandam, after it was refused entry into Chile nearly two weeks ago.

The ship, which had 53 passengers and 85 crew members aboard displaying symptoms, was denied passage through the Panama Canal to allow easy access to Florida.

The company, which, of course, is owned by cruise industry conglomerate Carnival Corp., didn’t say how many passengers and crew were tested, but said 53 passengers and 85 crew members are exhibiting symptoms consistent with the coronavirus. There are more than 1,800 people aboard the ship, the company said, along with four doctors and four nurses.

The Zaandam, which is currently anchored off the coast of Panama, is at least the third Carnival-owned ship to become the host of a COVID-19 outbreak. The Grand Princess, which made headlines after being barred entry to San Francisco, and the Diamond Princess, which required countries to evacuate passengers, including the US, are both run by Carnival-owned Princess cruises.

What’s more galling, though, is that the Zaandam still departed on the cruise from Buenos Aires on March 7 after the panic about COVID-19 had already started. The ship was at sea when Carnival suspended all operations later in the month. And the cruise was supposed to end March 21, but the ship was refused permission to dock in Chile, and it’s now anchored off the coast of Panama, as authorities refuse to let it pass through the Panama Canal.

The ship is telling the press it plans to disembark passengers in Florida, but exactly how it’s going to get there remains unclear.

Another Holland America ship, the “Rotterdam,” met the Zaandam at sea on Thursday, the company said, before adding that it plans to transfer healthy patients from one ship to the other before they are exposed to COVID-19. All passengers and crew currently exhibiting symptoms will remain on the Zaandam. The company said it is following guidance from the CDC.

In other words, everyone who has COVID-19 symptoms aboard that ship is screwed. They will be left twisting in the wind until the virus consumes virtually everybody on board. No one will take them in, at this point they don’t have the resources to sail around the tip of South America. Rumor has it that the State Department is planning another evacuation. That’s the last hope for the more than 100 people who are being virtually abandoned on board that boat.

Cruise Lines have been criticized for their poor handling of the crisis. Former passengers of the Costa Luminosa have died after the company and captain of the ship did little to protect passengers. As the Miami Herald reported in partnership with ProPublica, the cruise lines that are now begging for bailouts did little or nothing to shield passengers once news of the outbreak became public. Once the ship made a stop, in Puerto Rico, passengers said the cruise officials didn’t let them know about the sick people on board until they were out at sea again the next day.

“If the ship had told everyone what was going on, my dad and stepmom would have gotten off in Puerto Rico and flown home,” said Kevin Sheehan, Tom’s son. “But they didn’t tell them. So they stayed on the ship.”

Because he stayed on the ship, Tom Sheehan died at sea, away from his family, as COVID-19 shut down all of his organ systems one by one.

The ship couldn’t make its planned next stop in Antigua, so it continued across the Atlantic for a full week with no stops. Passengers were allowed unfettered access to the pools, gym and buffet the entire time, even after news broke at the end of the week about the test results – and the people still used them! They assumed it was safe since the company wasn’t saying anything.

Authored by Mac Slavo via SHTFplan.com,

A Seattle-based NPR station has stated that it will no longer be airing President Donald Trump’s coronavirus briefings because of “misinformation.”  As we’ve learned over the past several years, misinformation is simply the information they don’t want you to hear.

So what is the “misinformation” Trump has been saying? Obviously things the mainstream media wants to avoid, like asking people to remain calm, look at the objective facts and statistics about the pandemic and stop playing into the fear-mongering of the mainstream media. Fear has boosted mainstream media’s ratings in the past few weeks, adding to their profits. Reopening the economy means people would be at work or at least out doing things instead of watching the panic-laced headlines scroll across the TV.

“KUOW is monitoring White House briefings for the latest news on the coronavirus – and we will continue to share all news relevant to Washington State with our listeners,” the station tweeted.

“However, we will not be airing the briefings live due to a pattern of false or misleading information provided that cannot be fact-checked in real-time.”

However, we will not be airing the briefings live due to a pattern of false or misleading information provided that cannot be fact checked in real time. (2)

— KUOW Public Radio (@KUOW) March 24, 2020

This habit of censorship needs to end now.  How about instead of censorship like totalitarian regimes resort to, we let people have access to all of the information and decide for themselves if it’s fact-based or not?  It’s time to provide people with facts, not fear. This is simply another tactic to panic Americans, who are already scared to death about the pandemic and the aftermath they’ll have to live through.

Most recently, Trump has called for the lifting of social distancing guidelines in the near future, perhaps by Easter, even though public health professionals are still grappling with the spread of the virus. He also has made false claims about the availability of tests, the timeline for finding a vaccine and the potential benefits of a treatment that includes the ingredient chloroquine. While there is some promising study of its potential use, it has not been approved for treatment. NBC News reported on one Arizona man who died after ingesting chloroquine phosphate, and his wife said that they learned about its use after watching a briefing. –Yahoo

First, calling for the lifting of the economic shutdown is not “misinformation.”  It should be done sooner and people should be responsible and not spread the disease, but destroying people’s lives to slow the spread is hardly a solution to the problem, which based on the objective statistics, isn’t that severe of a virus if you’re healthy.  It sure seems like NPR should be more worried about making sure people are getting objective facts rather than scaring them with the “reopening” of the economy.

The news networks have been covering the briefings live, but CNN and MSNBC cut away from them on Monday, as the event stretched beyond an hour.

Deputy White House Press Secretary Judd Deere criticized the channels for the decision as “disgraceful,” but an MSNBC spokesperson said that “after airing the press conference for over an hour we cut away because the information no longer appeared to be valuable to the important ongoing discussion around public health.” A spokeswoman for CNN said, “If the White House wants to ask for time on the network, they should make an official request. Otherwise, we will make our own editorial decisions.” –Yahoo

Pretty disgraceful that @CNN and @MSNBC have both cut away from this @WhiteHouse briefing with @realDonaldTrump and @Mike_Pence during a global pandemic. Thank you to @FoxNews for keeping Americans informed. #COVID19

— Judd Deere (@JuddPDeere45) March 23, 2020

The truth is, politicians rarely if ever tell the truth, and the majority of the public knows that.  Censorship, on the other hand, is nothing more than a tool of totalitarian control. It comes out when the media desperately needs to control the narrative. Perhaps they fear that they are losing the attention of the public. It’s difficult to say, but censorship (like what China used at the beginning of the coronavirus outbreak) is never acceptable.

For an eye-opening take on why social distancing has become the “new normal,” check out James Corbett’s Propaganda Watch:

All that said, do the right thing and do not spread this virus around. Practice effective hand washing, teach your children how to properly wash their hands, and don’t be around other people if you’re sick.  Keep a safe distance between people while in public to avoid the virus, and if you feel more comfortable, wear a face mask.

While much of the world is practicing social distancing to slow the spread of COVID-19, Indians – some donning face masks – are still gathering in tightly packed crowds despite an order to ‘stay indoors’ by Prime Minister Narendra Modi.

Here’s the scene at the bus station in Dheli:

Delhi bus stationpic.twitter.com/Bwnp40UIF8

— Old Holborn ✘ (@Holbornlolz) March 28, 2020

It’s not much better in some parts of the UK:

With the mosques closed due to #Coronavirus

They just rock up on a tennis court in Birmingham. pic.twitter.com/cxUwgj2TJc

— Jack Dawkins (@DawkinsReturns) March 28, 2020

Authored by Seth Levine via RealInvestmentAdvice.com,

These are truly remarkable times in the investment markets. The speed, intensity, and ubiquity of this selloff brings just one word to mind: violence. It would be remarkable if it wasn’t so destructive. Sadly, the reactions from our politicians and the public were predictable. The Federal Reserve (Fed) faithfully and forcefully responded. Despite its unprecedented actions, it seems like they’re “fighting the last war.”

Caveat Emptor

My intention here is to discuss some observations from the course of my career as an investor and try to relate them to the current market. I won’t provide charts or data; I’m just spit-balling here. My goal is twofold: 1) to better organize my own thoughts, and; 2) foster constructive discussions as we all try to navigate these turbulent markets. I realize that this approach puts this article squarely into the dime-a-dozen opinion piece category—so be it.

Please note that what you read is only as of the date published. I will be updating my views as the data warrants. Strong views, held loosely.

The Whole Kit and Caboodle

Investment markets are in freefall. U.S stock market declines tripped circuit breakers on multiple days. U.S. Treasuries are gyrating. Credit markets fell sharply. Equity volatility (characterized by the VIX) exploded. The dollar (i.e. the DXY index) is rocketing. We are in full-out crisis mode. No charts required here

With the Great Financial Crisis of 2008 (GFC) still fresh in the minds of many, the calls for a swift Fed action came loud and fast. Boy, the Fed listen. Obediently, it unleashed its full toolkit, dropping the Fed Funds rate to 0% (technically a 0.00% to 0.25% range), reducing interest on excess reserves, lowering pricing on U.S. dollar liquidity swaps arrangements, and kick-starting a $700 billion QE (Quantitative Easing) program. The initiatives are coming so fast and so furious that it’s hard to keep up! The Fed is even extending credit to primary dealers collateralized by “a broad range of investment grade debt securities, including commercial paper and municipal bonds, and a broad range of equity securities.” Really?!

Reflexively, the central bank threw the whole kit and caboodle at markets in hopes of arresting their declines. It’s providing dollar liquidity in every way it can imagine that’s within its power. However, I have an eerie sense that the Fed is (hopelessly) fighting the last war.

The Last War

There are countless explanations for the GFC. The way I see it is that 2008 was quite literally a financial crisis. The financial system (or plumbing) was Ground Zero. A dizzying array of housing-related structured securities (mortgage backed securities, collateralized debt obligations, asset-backed commercial paper, etc.) served as the foundation for the interconnected, global banking system, upon which massive amounts of leverage were employed.

As delinquencies rose, rating agencies downgraded these structured securities. This evaporated the stock of foundational housing collateral. Financial intuitions suddenly found themselves short on liquidity and facing insolvency. It was like playing a giant game of musical chairs whereby a third of the chairs were suddenly removed, unbeknownst to the participants. At once, a mad scramble for liquidity ensued. However, there simply was not enough collateral left to go around. Panic erupted. Institutions failed. The financial system literally collapsed.

This War

In my view, today’s landscape is quite different. The coronavirus’s (COVID-19) impact is a “real economy” issue. People are stuck at home; lots are not working. Economic activity has ground to a halt. It’s a demand shock to nearly every business model and individual’s finances. Few ever planned for such a draconian scenario.

Source: Variant Perception

Thus, this is not a game of musical chairs in the financial system. Rather, businesses will be forced to hold their breaths until life returns to normal. Cash will burn and balance sheets will stretch. The commercial environment is now one of survival, plain and simple (to say nothing of those individuals infected). Businesses of all sizes will be tested, and in particular small and mid-sized ones that lack access to liquidity lines. Not all will make it. To be sure, the financial system will suffer; however, as an effect, not a primary cause. This war is not the GFC.

Decentralized Solutions Needed

Given this dynamic, I’m skeptical that flooding the financial system with liquidity necessarily helps. In the GFC, a relatively small handful of banks (and finance companies) sat at the epicenter. Remember, finance is a levered industry characterized by timing mismatches of cash flows; it borrows “long” and earns “short.” This intermediation is its value proposition. Thus, extending liquidity can help bridge timing gaps to get them through short-term issues, thereby forestalling their deleveraging.

Today, however, the financial system is not the cause of the crisis. True, liquidity shortfalls are the source of stress. However, they are not limited to any one industry or a handful of identifiable actors. Rather, nearly every business may find itself short on cash. Availing currency to banks does not pay your favorite restaurant’s rent or cover its payroll. Quite frankly, I’m skeptical that any mandated measure can. A centralized solution simply cannot solve a decentralized problem.

Fishing With Dynamite

The speed and intensity at which investment markets are reacting is truly dizzying. In many ways they exceed those in the GFC. To be sure, a response to rapidly eroding fundamentals is appropriate. However, this one seems structural.

In my opinion, the wide-scale and indiscriminate carnage is the calling card of one thing: leverage unwinding. It wouldn’t surprise me to learn of a Long Term Capital Management type of event occurring, whereby some large(?), obscure(?), new (?), leveraged investment fund(s) is (are) being forced to liquidate lots of illiquid positions into thinly traded markets. This is purely a guess. Only time will tell.

Daniel Want, the Chief Investment Officer of Prerequisite Capital Management and one of my favorite investment market thinkers, put it best:

“Something is blowing up in the world, we just don’t quite know what. It’s like if you were to go fishing with dynamite. The explosion happens under the water, but it takes a little while for the fish to rise to the surface.”

Daniel Want, 2020 03 14 Prerequisite Update pt 4

What To Do

This logically raises the question of: What to do? From a policy perspective, I have little to offer as I am simply not an expert in the field (ask me in the comment section if you’re interested in my views). That said, the Fed’s response seems silly. Despite the severe investment market stresses, I don’t believe that we’re reliving the GFC. There’s no nail that requires a central banker’s hammer (as if there ever is one). If a financial crisis develops secondarily, then we should seriously question the value that such a fragile system offers.

Markets anticipate developments. I can envision a number of scenarios in which prices reverse course swiftly (such as a decline in the infection rate, a medical breakthrough, etc.). I can see others leading to a protracted economic contraction, as suggested by the intense market moves. Are serious underlying issues at play, even if secondarily? Or are fragile and idiosyncratic market structures to blame? These are the questions I’m trying to grapple with, weighing the unknowns, and allocating capital accordingly.

As an investor, seeing the field more clearly can be an advantage. Remember, it’s never different this time. Nor, however, is it ever the same. This makes for a difficult paradox to navigate. It’s in chaotic times when an investment framework is most valuable. Reflexively fighting the last war seems silly. Rather, let’s assess the current one as it rapidly develops and try to stay one step ahead of the herd.

Good luck out there and stay safe. Strong views, held loosely.

Even as liberals whine about President Trump’s petty feuds with reporters and his newfound insistence that the country – or at least sizable parts of it – get ‘back to work’ by Easter (April 12), his approval rating has continued to climb, as Americans rally around the president during times of crisis (and, to be fair, Trump stepped up during that one Friday press conference where he sounded reassuring presidential, even if his promises about ramping up testing ultimately never came true).

Unfortunately, the same cannot be said for New York City Mayor Bill de Blasio, whose laughable presidential campaign is still not too far in the rearview mirror. Remember how even de Blasio’s own wife expressed doubts about his suitability for the presidency? Well, as Politico documents in an in-depth report about de Blasio’s handling of NYC’s response to COVID-19, during the weeks before the city emerged as the country’s biggest hot spot, even as the suburbs immediately surrounding the city succeeded in quelling outbreaks of their own, de Blasio dithered and put off critical decisions.

The result was he waited too long to close schools and way too long to close restaurants and other “non-essential” businesses. The result is that the city’s hospitals are now being overwhelmed faster than any other hospital system in the country, like the hospital in Elmhurst where 13 people died from COVID-19 in a single day earlier this week.

All of this isn’t a coincidence: It’s a direct result of de Blasio’s decision not to take the outbreak seriously, and to wait for “more information” before deciding on critical closures.

Even once the threat at hand had been made clear, de Blasio made critical mistakes during the response, including failing to outline a response protocol for municipal employees that kept thousands coming into the office longer than they needed to.

Meanwhile, the gaffe-prone mayor, who is one of the least popular big-city mayors in the country, and is perhaps best known for his long-time feud with Andrew Cuomo, the New York governor who has emerged as a national star of the outbreak, continued to do what he does best: produce embarrassing gaffes. His piece de resistance was going to the gym the morning he ordered all non-essential businesses (including gyms) to close.

De Blasio, who uses a public gym because he’s a “man of the people” (okay pal like there’s not a gym at Gracy Mansion? You’re wasting municipal resources to cart your ass back to Brooklyn for these workouts) responded by claiming “There was almost no one there. I had heard that information prior..I suspected that we were all going to be about to close them down, and this would be the last time to get some exercise.”

There was almost no one there because most responsible New Yorkers were practicing social distancing, including avoiding public places. What kind of message does it send when the mayor doesn’t obey his own guidance.

And it was exactly these types of mixed messages that hampered the mayors response and proved his critics – who insist that he is an inept administrator and even worse politician who is only in office thanks to the well-timed implosions of his political rivals – correct.

Some even questioned whether the death of a Brooklyn principle, who succumbed to the virus this past week, is directly a result of de Blasio’s reluctance to close the schools even after the teachers unions, members of his staff and health officials pushed him to. His reason for the delay? The urgings of the city hospital system administrator, who urged him to have a plan in place for the students because she worried it would affect staffing levels at city hospitals if parents had nothing to do with their kids.

Here’s more from Politico:

To that end, de Blasio kept schools open for days after parents, teachers and members of his own administration urged him to close them, touching off a feud with the teachers union, which chastised the health department this week after a 36-year-old principal died from the coronavirus.

Three city officials familiar with his decision-making process said he was relying on advice from Mitchell Katz, head of the city’s public hospital system, who worried school closures would compromise staffing levels at hospitals during an emergency. De Blasio was also concerned about the lopsided impact it would have on low-income students and single-parent households.

He insisted schools would remain open during TV interviews on the morning of March 15, even as he was preparing to announce a system-wide closure later that day.

“You know I hated closing the schools. I thought it was going to cause all sorts of other problems and of course it has,” de Blasio said during a radio interview Friday morning. Gov. Andrew Cuomo, who has been granted public hero status during this crisis, similarly reversed his stance on closing schools within a matter of hours that Sunday.

And then there was that senseless feud with Cuomo’s office over the “shelter in place” order, some nonsensical semantics that is a moot point now: everybody’s staying inside – people are only leaving to get food and other essential things.

He also dithered when it came to canceling the St. Patrick’s Day parade, waiting far longer than other national mayors.

He and de Blasio were also at odds over whether to require New Yorkers to “shelter in place,” an argument of semantics that went on for days as residents were left without clear guidance. De Blasio was calling for the policy earlier than Cuomo, while also signaling confusion about its implementation.

“What is going to happen with folks who have no money? How are they going to get food? How are they going to get medicines?” he asked during a news conference on March 17. “There’s a lot of unanswered questions.”

In another example of his mixed messaging, he has said he will make a “first attempt” to reopen schools by April 20, while also calling President Donald Trump’s push to bring businesses back by Easter, which falls on April 12, “false hope.”

Yet on Friday de Blasio tweeted that April 5 is “the day the strains we’re seeing right now on medical supplies and personnel could overwhelm us if we don’t get the help we need. This is a race against time.”

De Blasio spent days deliberating over whether to cancel the St. Patrick’s Day parade, even after other cities canceled theirs, did not provide clear guidance over a municipal work-from-home policy, according to multiple agency leaders, and argued with library officials who wanted to close their branches before he was ready.

The mayor also played down fears that city hospitals might face shortages of space and equipment and supplies, all of which now appears to be happening.

Shortly after the World Health Organization deemed the coronavirus a pandemic on March 11, the mayor was asked to respond to expected recommendations about a possible quarantine.

“I think we can say at this point in time we’re looking at all the guidance, but with a bit of a trust-but-verify worldview,” he said.
He also said the city’s hospitals were ready for an influx of patients. “We have 1,200 beds that we can activate readily,” he said on March 8.

“Just the fact that you’ll turn off a lot of non-essential things and turn all that talent and capacity to a crisis, should give New Yorkers a lot of confidence that, you know, even with hundreds of cases, we’d be able to handle it.”

This week The New York Times chronicled the nightmarish scenes from one of the city’s public hospitals, where 13 people died in a single day.

Privately, people across City Hall have begun to wonder whether de Blasio’s week of delayed action put people in danger.

And then there’s de Blasio’s decision to criticize President Trump’s push to reopen parts of the country by Easter while de Blasio promises to take a look at reopening the schools on April 20.

To be sure, some outside experts who worked with the mayor defended his approach, and even a former director of his public works department defended the mayor’s response, saying he didn’t think he would have done anything differently. Others disagree.

And at this point, with the NYPD reporting the death of the first detective on Saturday morning as both the number of confirmed cases and deaths climbs, it’s beginning to seem like the proof will be in the pudding.

Authored by Jonathan Turley,

The incredible meltdown of Rep. Haley Stevens, D-Mich.,yesterday on the floor of the House of Representatives shows how members can fuel rather than fight hysteria and panic.

The shocking scene was played out as the very task force members who she referenced are trying to rebut some alarmist predictions and estimates. Much of the nation is sheltering in place. We get it. However, Rep. Stevens seems intent on elevating not the discussion but the volume of the national discourse.

What was most notable is that Stevens was not saying anything particularly new… just saying it louder. Indeed, the Democratic Majority Whip was trying to give her the added 30 seconds that she had asked, but she was yelling over his voice.

Everyone is supporting our health care workers and “taking the disease seriously.” As for “you will see darkness,” we could all use a bit more light from our elected officials. Once the yelling ended, Grandpa Abe Simpson seemed to have more a hold of himself in his prophesy scene.

The chair spoke for the entire nation in saying “The gentle lady from Michigan is out of order.”