After The Virus - What Next?

[Mega]

Re: After the Virus? Cognitive Dissonance

This is going to be a thing of beauty, not for the people but our "Political class" will love it.

[jpatter666]

Re: After the Virus? Cognitive Dissonance

Do you think that serial bubble thing is still going on? I'm thinking of the mechanism. The internet stock market bubble burst followed by a fed induced housing bubble. That progression was because housing had not previously been inflated. People stung by the internet bubble took their remaining cash and bought houses. That always seemed a little simplistic. Recently we have seen a credit fueled rise in stock markets and high yield bonds. Are these bubbles and are they bursting? Are world central banks still trying to inflate bubbles?

I'm not sure I'd call it a deliberate attempt to inflate bubbles as much as an attempt to keep the whole damn thing from imploding -- a side effect of which is bubbles in various areas.

[strittmatter]

Re: After the Virus? Cognitive Dissonance

https://youtu.be/wVs5AyjzwRM

[Woodsman]

Re: After the Virus? Cognitive Dissonance

New JAMA report on 5700 NYC Covid patients:

-94% had MORE than one other disease
-Median age 63
-53% had hypertension
-42% were obese
-32% had diabetes
-Of all fatal cases in NY, 2/3 were over 70
-Mortality rate w/out underlying conditions was 0.1% to 0.2%

We now know about asymptomatic transmission, but the outset had no inkling of it. As such, the initial screening attempts only intercepted those showing symptoms and as such were relatively worthless. Appreciating how badly they screwed the pooch, the oh so expert health authorities panicked and ordered a general lockdown. They did it despite the knowledge gained from places like Italy that the largest cohort of those infected and showing the worst symptoms are and remain the aged and those with comorbid illnesses.

It's impossible to say that we are "just beginning to plateau" because those data are retrospective and subject to the delays built into the reporting structure, making it rather likely that the "plateau" is behind us. That said, reporting is both improving in its efficiency and degrading in its quality as the guidance from health authorities has expanded to roll in as high a count as can be gathered so that any mortality "with" Covid is counted as "by" Covid. This seems to me like an attempt to eat one's cake and have it too. And the hysteria about "overwhelming our ICUs" isn't comporting with even the less than ideal data we have thus far. Speaking of Georgia, the 1k beds stood up at the massive World Congress Center convention building remain empty, much like the Javits Center in NY and the hospital ship Mercy. Hospitals are laying off staff. The sky-is-falling predictions which apparently motivated this absurd and soon to be obvious to all (save the "experts") ineffective mass lockdown, given the growing evidence from serological studies, have not and I strongly suspect will not come to pass.

The Imperial College study so many "responsible" figures hold up as evidence has been effectively debunked by the reality on the ground, even if the health authorities refuse to admit it while they reduce their estimated body count by orders of magnitude downward. The models promised unimaginably huge numbers. We haven’t come anywhere close to them. Millions and millions and millions of lives the world over have been ruined, with more ruin on the way, as the result of trusting expert models. They have to find a way to bring actual numbers in line with models. They’re running out of options, though. Dying with from dying from was a good move, and we saw it immediately pop up in the death counts. Dying with suspicion from dying with was also clever enough, and we saw that, too. What else is left, though? Only one thing. If “dying from” is defined as dying with presence of COVID-19 antibodies, then once we reach herd immunity, then about 80% of all deaths can be classified as coronavirus deaths.

Places like Georgia may see a spike or the trend may continue downward, but you can be sure that any "good news" will be minimized and any increases will be heralded as a catastrophe, and being in the South, undoubtedly linked with a nefarious racial conspiracy. It's a particularly disingenuous bit of ass covering to warn folks not to have a heart attack, stroke, or cancer while the states "open up" when the blanket lockdown has forced everyone who needed regular and ongoing care for such chronic conditions to delay it. Again, this evidences a rather transparent urge by some to have it both ways. We can't leave our homes and return to our businesses and jobs because there is no herd immunity even though the antibody studies show an ever growing number of persons who were infected but showed mild to minimal symptoms. We can't gain herd immunity if all the cattle stayed locked in their pens, either, so it's damned if you do or damned if you don't and par for the course for our esteemed health professionals (everyone clap, all together now). Oh, and please don't ask for any guarantees because of the multiple things we don't know, gotten wrong, backtracked, covered up, and minimized, but please do exactly what we say despite our profound ignorance and the misguided and counterproductive policies we forced on you out of that ignorance, but do exactly as we say nonetheless or all of you will die.

Because we know what we know until we find out we were wrong and what we don't know is either so dangerous or so unimportant that you will or will not risk a horrible and painful death unless you do precisely as we say at any given moment. We're only trying to save lives from this virus and even if millions more die world-wide from the effects of our lockdown, it will be the lockdown that beat it and your fault for ignoring us if we don't beat it, so you'll just have to trust us that it would have been far worse if we hadn't even if the worst of effects of our policy will be with us long after the virus has passed. And anyway we won't fund research that says anything to the contrary and ruin any researcher that dares step out of line.

Oh wait...stand by. Looks like there are some new and revised guidelines being released as I speak! Here they are:

1. Basically, you can't leave the house for any reason, but if you have to, then you can.
2. Masks are useless. But they will protect you. They can save you, no they can’t, they’re useless, but wear one anyway. Now they’re mandatory. But maybe. Or not.
3. Stores are closed, except for the ones that are open.
4. You should not go to the hospital unless you have to go there. Stay out of the ER at all costs unless you’re having a medical emergency then it’s okay.
5. This virus is deadly but still not too scary, except that sometimes it actually leads to a global disaster. Stay calm.
6. Gloves won't help, but they can still help. Especially if you wear the same pair for hours and everywhere you go, then you can not spread germs, nope. #science
7. Everyone needs to stay home, but it's important to go out because sun. Sunlight will kill the virus but not if the virus kills you first by walking in the sunlight where you may be exposed to the virus.
8. There is no shortage of groceries in the supermarket, but there are many things missing when you go there in the evening, but not in the morning. Sometimes.
9. The virus has no effect on children except those it has affected or will affect.
10. Animals are not affected, but there is still a cat that tested positive in Belgium in February when no one had been tested yet, and a tiger.. and one really deadly but also possibly fictional but very sick bat.
11. You will have many symptoms when you are sick, but you can also get sick without symptoms, have symptoms without being sick, or be contagious without having symptoms.
12. In order not to get sick, you have to eat well and exercise, but also never go out to the grocery store so eat shelf stable processed crap and stay inside your four walls but also stay healthy.
13. It's better to get some fresh air, but you may be arrested if you’re getting fresh air the wrong way and most importantly, don't go to a park, the fresh air there is deadly.
14. Under no circumstances should you go to retirement homes, but if you have to take care of the elderly and bring them food and medication then fine. Just wear gloves. The same ones. All day.
15. If you are sick, you can't go out, but you can go to the pharmacy to get your medications. Just don’t make eye contact cause you may spread your sickness that way.
16. You can get restaurant food delivered to the house, which may have been prepared by people who didn't wear masks or gloves. But you have to leave your groceries outside for 3 hours to be decontaminated by the fresh air that also may have virus particles floating around in it.
17. Taxi drivers are immune to the virus apparently since you can still take a taxi ride with a random taxi driver. Just don’t take the taxi to your mom’s house because you know. Stay away from your mom.
18. You can walk around with a friend if you stay six feet apart but don’t visit with your family if they don't live under the same roof as you. Even if you’ve all been locked inside for two months already. You may still have the virus and just not know it yet. You’ll find out. Wait another week. Wasn’t that week? Might be the next one. Keep waiting.
19. You are safe if you maintain the appropriate social distance, but you can’t go out with friends or strangers at the safe social distance. Social distancing means you shouldn’t leave your house and don’t be social, except you may go to the liquor store but don’t socialize there while you’re being socially distant.
20. The virus remains active on different surfaces for two hours, no, four, no, six, no, we didn't say hours, maybe days? But it takes a damp environment. Oh no, not necessarily.
21. The virus stays in the air - well no, or yes, maybe, especially in a closed room, in one hour a sick person can infect ten, so if it falls, all our children were already infected at school before it was closed. But remember, if you stay at the recommended social distance, however in certain circumstances you should maintain a greater distance, which, studies show, the virus can travel further, maybe.
22. We count the number of deaths but we don't know how many people are infected as we have only tested so far those who were "almost dead" to find out if that's what they will die of…
23. The virus will only disappear if we achieve collective immunity.. but stay inside until the virus disappears.
24. Most importantly, stay in a constant state of fear, agitation, and panic. The authorities and media will help you with this by not telling what kinds of people will be most likely to be affected, which kinds of people are most likely to die, and how many have recovered. If your state has 2000 cases, you won't be told how many have recovered - so far as you know, they're all deathly ill, but also walking around spreading disease like Typhoid Mary. You're next.
25. Be afraid.
26. Stay terrorized.
27. Forget our mistakes.
28. Blame your political enemies.
29. Ignore your common sense.
30. Trust us.

[Mega]

Re: After the Virus? Cognitive Dissonance

......................& Bloody useful to getting China on the hook!
The mask has slipped, no one gave a sh1t when China was hurting people local to them.......now that China has HURT people in the west...

[Mega]

Re: After the Virus? Cognitive Dissonance

From a year ago:-

[globaleconomicollaps]

Re: After the Virus? Cognitive Dissonance

I'm not sure I'd call it a deliberate attempt to inflate bubbles as much as an attempt to keep the whole damn thing from imploding -- a side effect of which is bubbles in various areas.

It has been a long time but I think that Bernanke did in fact say at one point that the Fed had an official policy of promoting bubbles.

--- While a Fed governor from 2002 to mid-2005, Bernanke was a cheerleader for Chairman Alan Greenspan's view that the central bank shouldn’t be in the business of fighting asset bubbles by, say, tightening credit to deflate them. "On this count, he stood with his predecessor -- serial bubble-blowing Greenspan -- who argued that monetary authorities are best positioned to clean up the mess after the bursting of asset bubbles rather than to pre-empt the damage," Roach says.

source

[Techdread]

Re: After the Virus? Cognitive Dissonance



Looks like big business will be building a war chest to buy up smaller business when this crisis over. 500B in loans for companies whom inflated their share price via share by backs that enriched insiders.


Over 20 Million filling for unemployment benefits, how we love the model of US dynamic labour market. European levels of unemployment without the safety nets.

[Mega]

Re: After the Virus? Cognitive Dissonance

Yes, you are Spot on.......airlines will get to pick the bones of their weak competition.

[GRG55]

Re: After the Virus? Cognitive Dissonance

the idea of too much capacity is kind of interesting, since it is usually assumed that there is no end to human desire. a different way of thinking about it is as 2 mismatches: the first is producing too much of some things [e.g. every country wants an auto maker] and not enough of other things that people would indeed want. the other is a mismatch in the means of purchasing things. there are lots of people in the world who would like more of a whole variety of things, starting with those who want more food and clean water, and moving up the luxury chain from there. i think we could do ourselves a favor by not condensing those mismatches into "overcapacity", which puts the focus solely on the mistaken over-investment in some areas while ignoring the underinvestment in others, and the lack of means for a great deal of the population...

I would posit that the areas of underinvestment are perhaps those goods and services, in those locations/nations, for which it is difficult or impossible to extend long term credit. That might include food, potable water, basic health care, basic education (not the stuff people are taking student loans over today) and basic shelter (the sort of stuff we used to build from the 1920s to the 1960s, before particle-board McMansions and overpriced high rise urban condos).
Not that the financial industry hasn't tried - subprime mortgages being the prominent example. And we see where that got us.

Human desire might be endless, but we now have debt laden consumers with minimal savings living paycheck-to-paycheck to make their debt servicing payments. They "own" stuff they purchased with tomorrow's income.

Corporations have expanded capacity to meet demand from households for the increased rate of goods and services they've been buying on credit (such as new pick-up trucks and commercial airline seat-trips). Many of those same corporations have leveraged up balance sheets with near-junk bonds to (over)pay today's shareholders and stock-optioned executives/Boards with tomorrow's earnings.

And governments, unable to raise taxes on heavily indebted households and corporations without risking a downturn in consumption, run record deficits at times of record low unemployment. Some governments, such as the current Administration in D.C., cut taxes to boost consumption even further to stretch out the game. Those deficits allegedly to be paid back with tomorrow's taxes.

And then along comes a virus, and suddenly tomorrow arrives. Today.

one consequence of zirp has been the survival of many zombie companies, companies which don't earn enough to even service their debts.

In fact across 14 advanced economies, zombies now number 12% of all publicly-listed companies, according to a research paper by the Swiss-based Bank for International Settlements. Within the S&P 1500, 14% of companiescould be classified as zombies, according to analysis by Bianco Research.

surely overcapacity [in the sense of producing too much of the wrong stuff] starts with this group, and ridding ourselves of them would be a healthy thing for the economy..

your mention of "permanent capacity reductions" ultimately driving demand-pull inflation sounds right to me. the fed and the treasury and the gov't can drop money from helicopters, thereby replacing the potential demand lost when people lost their incomes. but they can't create things - goods and services- for that money to buy.

Thousands upon thousands of parked commercial airliners are one of the more visible examples. I'm having difficulty imagining Boeing or Airbus ever again producing the volume of new aircraft they did in the last few years. There was trouble from overcapacity in the sector before the virus episode started; among that the A380 series appeared to have reached saturation. After all, a great deal of commercial air traffic is discretionary spending.

This backs up through the whole system. Not just a lower demand for aluminum and other raw materials (and the mining and smelting thereof) that go into an airplane, but also a lower demand for all the microchips, software, glass cockpits, robotics and other high technology that goes into building, flying and maintaining each one.

Multiply that across numerous economic sectors all over the world.

Coming full cycle to where I started above, I'm wondering if Jim Rogers is finally going to be proved (partially) correct...the investment portfolio of tomorrow might best be in non-discretionary sectors such as agriculture, water, energy, health care/medical/pharma, public transportation infrastructure, education and basic shelter. Those sectors of the economy and the related supplier companies that are not heavily dependent on consumer debt financing to make a purchase.

[Mega]

Re: After the Virus? Cognitive Dissonance

"Take your desires for reality"

.............and suddenly reality hit back!

[shiny!]

Re: After the Virus? Cognitive Dissonance

Coming full cycle to where I started above, I'm wondering if Jim Rogers is finally going to be proved (partially) correct...the investment portfolio of tomorrow might best be in non-discretionary sectors such as agriculture, water, energy, health care/medical/pharma, public transportation infrastructure, education and basic shelter. Those sectors of the economy and the related supplier companies that are not heavily dependent on consumer debt financing to make a purchase.

Could you expand your views on the health care/medical/pharma and education sectors?

I would think health care/medical/pharma is vulnerable if Democrats win both the white house and a congressional majority in 2022. Socialized medicine wouldn't happen overnight, but what investment time frame are you looking at? And isn't higher education dominated by student loan debt?

[lakedaemonian]

Re: After the Virus? Cognitive Dissonance

A couple of personal observations about disruption in health care and education.

Health Care:

Primary Health Care is a $300+ billion business in the US.

Companies like Circle Medical that are built from the ground are exploiting opportunities that can be leveraged thru technology platforms for telemedicine and AI/doctor teaming.

CV19 has been a tailwind for them accelerating their growth plans. They just expanded beyond Bay Area, California to 27 states and 2/3rds of the country due to CV19.

They have a Net Promoter Score (NPS) of 92 out of 100. Average for healthcare sector is 27.

They were funding organic growth thru cashflow, but have taken additional funds to fuel faster growth.

It might be the cross between McDonalds systems and AirBnB capacity utilisation that we need.

AI diagnosis has been outperforming human diagnosis, so AI/human teaming could really provide a better, faster, cheaper experience.

My Dad just had a followup telemedical appointment from a very prestigious outfit in the northeast. They used FaceTime, and still had to wait online for 25 minutes for a 3 minute consult. Much more of a bandaid telemedicine solution than one with telemedicine built into the org’s DNA.

Education:

Lambda School is an online & live training only software engineering and data science school. They pack the equivalent of a 4 year degree into 9-18 months.

Think plumber, electrician, machinist for software engineering and data science.

Theoretical, but with a very heavy emphasis on hands-on tangible skillset practical.

Approximately 1500-2000 hours of hands on experience.

Tuition can be paid up front, but most choose an Income Share Agreement(ISA) where the graduate pays nothing if they do not gain a related job that pays greater than $50k a year, paying back a max of 17% of your gross income for 2 years, up to a max of $30k.

So the school is incentivised for you to be gainfully employed, otherwise they don’t get paid.

They have students who have gone from working McJobs to working at FAANG for very big money in under 1 year.

Stanford & MIT have 2 of the biggest school endowments in the world, especially Stanford where there 8000 acre campus with some of the most valuable RE in the world is on the balance sheet for just $1(can’t be sold, but can be leased).

They have halted hiring, canned all contractors, and cut salaries.

Any school outside of the top 20, and surely beyond the top 50 are potentially doomed.

I would say best case scenario is Top 50 & flagship state school campuses survive.

But 2nd/3rd tier schools are in big, big, big trouble.

The investment thesis of the last 10-20 years of retiring to a small college town with a hospital may have been fatally disrupted by CV19.

Stanford’s famous CS106A programming class was just offered online for the 1st time during the lockdown, 80k applicants in 3 days.

But no one will pay Stanford tuition for an online only experience.

I reckon the massive number of “manufacturing jobs” lost after the real estate and mortgage bubble of the 2000’s will be repeated in higher education admin job losses in the next 1-3 years.

Another higher education trend besides new online first business models is likely to be the rise of rock star teachers.

With digital delivery we will likely see far fewer teachers receiving far more of a shrinking pie.

Those in the bottom 50-66% of teaching will probably be worse off in the long-term.

Those in the top 1/3 will be OK.

Those in top 1% of teaching will become pop/rock stars.

——-

Overall, I think some existing companies and schools will adapt.

But ultimately they will face innovator’s dilemma, trying to earn cash from existing customers, and never really committing to the new reality.

Think QuickBooks(started with floppy disks, but awkwardly migrating to a cloud world) as second fiddle to Xero, born in the cloud.

What healthcare and education companies born in the cloud will will become the next monopolies?

Both Circle Medical and Lambda School were accelerated by Y-Combinator, the home of AirBnB, Reddit, Dropbox, etc.

Just 2 examples, 1 from each sector, that have a decent chance of disruption their respective sectors, or informing the general direction of others who will.

Disclosure: I’m a shareholder of Circle Medical.

[jk]

Re: After the Virus? Cognitive Dissonance

scott galloway on post-corona higher ed:
https://www.profgalloway.com/post-corona-higher-ed

[GRG55]

Re: After the Virus? Cognitive Dissonance

Could you expand your views on the health care/medical/pharma and education sectors?

I would think health care/medical/pharma is vulnerable if Democrats win both the white house and a congressional majority in 2022. Socialized medicine wouldn't happen overnight, but what investment time frame are you looking at? And isn't higher education dominated by student loan debt?

Second tier bricks and mortar colleges are toast.
Public school teachers unions are going to have an interesting time trying to control what kids are taught in the aftermath of parents observing what happens with the home schooling experiment.

Look for some dramatic changes in the way knowledge is disseminated given the recent intersection of technology and coronavirus. I think education in every form is one of the areas of the economy that undergoes the greatest change in the aftermath of this. Most are not going to have to borrow tens of thousands of $ to get a sound education in the future. Only the Ivy League schools might survive somewhat intact.

On the health care front there's too many powerful vested interests for rapid change across the board, but lake's post is an excellent indication of where this is going. There's also going to be the repatriation of medical products/consumables manufacturing from overseas...I think it's going to be almost politically impossible for that not to happen when this is over.