Jack Rasmus

The following are my observations on the evolution of the Covid 19 Pandemic, the US Response, the Impacts on the US & Global Economy, the Fed, and Congress’s Stimulus plans, from my twitter posts. (Check out the daily running commentaries as the health and economic crisis deepens through April, at @drjackrasmus)

#USrecession What’s different then (2008) & now (2020)? (Mar 30)

In 2007: real economy booming; financial crash then brings down real economy. In 2020: real econ slowing fast 4Q19(USA), stagnant (EU), recession (Japan); real econ collapses (1Q/2Q20) causing financial shock (& crash next?)

#Banks (Mar 30)

may not be ‘root’ of the problem in this ‘Great Recession 2.0’, but may be the ‘trunk’-espec. shadow banks Capital mkts & Institutional investor. Problems in comm paper, corp bond, repo mkts=shadow banks pulling back & commercial banks not stepping in to provide liquidity.
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#Coronavirus (Mar 30)

Both S. Korea and US recorded their first cases on Jan. 20. Korea started national mass testing (15k/day) of everyone by Jan. 30. US still has shortage of tests and no such policy. >100,000 US dead will be the legacy of that. So blame Trump, but also Bush & Clinton.

#Coronavirus (Mar 30)

Why is there such shortage of PPE in US? Ask GW Bush whose tax cuts 2001-04 subsidized US manufacturers to move to China after (i.e. after Clinton in 2000 gave China special trading rights–i.e. free trade lite). From Reagan to Trump, US econ policies changed little

#Coronavirus (Mar 30)

Why is there such shortage of US hospital beds? Ask Bill Clinton, whose healthcare legislation provided tax & other incentives to hospitals to reduce hospital beds & who allowed private for-profit-hospitals to buy up public hospitals & avoid anti-trust laws doing it

#Fed (Mar 29)

has committed $3T of its promised $4.5T already. But nada to most unstable sectors: $2.2T junk corp bonds, $1.2T junk leveraged loans, and low rated local government bodies. When defaults here start watch for psychological contagion effects to spread to general credit mkts

#Fed (Mar 29)

QE & excess liquidity 2008-16 fueled asset bubbles >2008. Hiatus 2017-18. Renewed 2019. More Fed liquidity 2020-21 will now fuel even bigger bubbles 2021-30. “The Problem (excess liquidity) becomes the Solution to the Problem” & creates next crisis. Financialization new norm

#Coronavirus (Mar 28)

Ever wonder where Google and Apple got the hundreds of thousands of masks they said they are now donating in the US? Not from their cellars in Cupertino, CA where they are located. Could it be they’re buying them in China? And that guy who owns Virgin Atlantic.

#Coronavirus (Mar 28)

China’s mega entrepreneur, Jack Ma, has offered to donate 1m masks and 500,000 test kits to the US. But no mention of China’s offer to sell masks or Ma’s offer to donate in Trump press conferences.

#Coronavirus (Mar 28)

US health officials say we need 3.5B masks. China now produces 116M A DAY! 12 times more than before the virus. China giving them away to Italy. So why isn’t Trump buying them? What happened to the US-China trade deal?

#healthcare (Mar 26)

What’s going to happen to millions being laid off who had employer provided health insurance?Why not create new Medicare Part E temp plan to sign up when filing for unemployment benefits? Add a surtax to Medicare’s 1.45% & reimburse Employers & workers in tax credits

#jobs (Mar 26)

How does this week’s 3.28 million new unemployment benefit claims compare to last week’s? It was 282,000. And was averaging less than 300,000 per week for past several months. Economists had forecast the increase would be 1m but it’s 3.2m.

#Jobs (Mar 26)

Data today show 3.28 million more workers applying for unemployment benefits this week. That’s just the tip of the iceberg of what’s coming. Federal Reserve governors had forecast 2m more. Meanwhile, Repub. Senators want to cut $600 benefit in Senate bill already agreed on.

#Fiscalstimulus. (Mar 26)

Just started reading the 880p actual Senate bill. $1,027B going to business is not the whole story. Looks like hundreds of billions more in the form of corporate tax cuts as well. Will be reporting on all that here once I finish reading the monster handout doc

#bailout (Mar 25)

In Senate bill Airlines get $58B–half as loans & half as grants, the latter to pay their workers. Reports coming out airlines taking the grants but not the loans. Could they be not that starved of cash? Taxpayers/Govt paying the workers. Call that ‘Airline Socialism’?

#Fiscalstimulus (Mar 25)

What’s holding up the Senate signing off $2T fiscal stimulus bill agreed last night? Repub Senator (Sasse-Neb.) says the $600 unemployment too generous, keeps workers taking new job. In reply, Bernie Sanders says he’ll hold up bill if Sasse won’t approve the $600

#fiscalstimulus (Mar 25)

Trump admin., media, & some economists now downplaying the Senate bill as a ‘stimulus’ bill. Only helps put a floor under current collapse of US econ. Another fiscal stimulus needed after short term effects of Senate $2T. Senate bill only good for 6-8 wks support

#USrecession (Mar 25)

What will be the GDP impact on the US economy? Goldman & Morgan Stanley banks forecast -24% to -30% 2Q20 drop in GDP. IF A V-SHAPE recovery (not likely) a full yr. GDP contraction of -5% to-8%. If not V-shape, worse. Major drag effect to occur. Recovery more U-shape

#USSenate (Mar 25)

Check out my summary of the final agreement on the economic Stimulus passed last night by the Senate. My analysis why it won’t be enough. Go to my blog,

#Fiscalstimulus (Mar 25)

Check out my summary and analysis of the Senate’s final agreement on an economic stimulus bill earlier this morning. Summary is based on latest reports by WashPost and CNN on the Senate document. To read go to m blog,

#Fiscalstimulus (Mar 25)

Check out my preliminary preview of the Senate bill and deal (subject to change when final details released) on my latest blog post at

#fiscalstimulus (Mar 24)

Here’s some details of Senate bill: unemployment insurance increased $600 over base, but for only 4 mos. (Good news: part time/temps/contractlabor covered). $1,200 check to families + $500/child (max # kids and income eligibility cutoff both ?) Stay tuned for more
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#fiscalstimulus. (Mar 24)

This confirmed in pending Senate bill: After threatening Congress they will fire all their workers if Congress doesn’t agree, Airlines will get $32B CASH GRANT, + another $29B in loans.

#Fed (Mar 23)

what’s its new ‘backstop’ to Main St. just announced? Fed will ‘support’ student, auto, credit card & small business loans–not ‘make’ loans. Means Fed to allow card, student, auto securitized loans made by banks & investors to dump that debt on the Fed, which will buy it.

#stockmarkets (Mar 23)

Global stock mkts rose from $35T in 2009 to $85T in 2019. In Trump’s 3 yrs, from around $70T to $85T, artificially fueled by massive investor tax cuts & cheap rates. That artificial ‘last leg’ now imploding back to $70T. So why is Fed & Congress subsidizing it again

#fiscalstimulus (Mar 23)

Once again on the Dems refusing to vote fpr McConnell’s $500B big corp handout bill: why won’t Dems even vote on today’s procedural vote? Because it takes 60 votes to pass. If they agree now, McConnell then needs only 50 to pass the $500B handout for corp buddies.

#Fed (Mar 23)

announced today it will start buying corp bonds, not just govt Treasuries from investors. Just like Europe & Japan have been doing for years. What’s next? Buy stock ETFs, like Japan? Negative rates like both? Who says the Fed’s mandate isn’t fin. mkts. What a fiction.

#Trump (Mar 23)

reportedly ‘toying’ with a return to work despite virus mounting cost in lives. About to decide “let them go back to work”. Hey Donald, don’t forget Marie Antoinette’s “let them eat cake” famous line. (To be fair to DJT, other Dem politicians, like Cuomo, considering same)

#Fiscalstimulus (Mar 23)

What’s the ruckus about Dems holding up the $500b bill in Senate? It’s p. 391 of bill where it says the government can keep secret for 6 months which corporations get the non-bank bailout $500k free money? (Banks will be bailed out by Fed’s $6.2T printed money)

#USrecession (Mar 23)

Watch for Trump & politicians to move to getting folks to return to work, despite rising infection & death rates. Don’t want to pay the cost ($4T+) stimulus to cover unemployed & shutdowns. (But will get Fed to spend $6T to pre-bail banks, investors & Wall St.)

#Fed (Mar 23)

latest move today to support investors behind credit cards, student, small business loans. Why not support the borrowers (students, households, small businesses) not the lenders? Reduce card rates to 7%; student loans to 1% (10yr Tbond), suspend interest on small bus. loans

#USrecesssion (Mar 23)

As the econ contraction deepens politicians will begin talking about, and finding ways, to get people back to work despite the rising virus caseload and deaths. The econ crisis will take precedence over the health crisis. (NY gov. Cuomo already raising the point)

#financialcrisis (Mar 22)

Corp bond mkts far more important to stability than stocks. Corp bond mkt now shut down. No issues occurring, despite Fed’s $2.2T injections last week. So watch for big Fed bailout of corp bonds this week, esp. junk & BBB investment grade (half of which is junk)

#fiscalstimulus (Mar 22)

Why does McConnell insist on $350B in loans to big corps, when Fed to provide $4T in loans through banks to big corps? Is it because the $350B will be ‘forgiven’ at a later date & in effect become grants? Btw, no deal with Dems tonite. Watch big stock fall Monday

#USrecession (Mar 22)

We are at am economic ‘rubicon’–not for a recession, or even for a great recession. But for a possible cross over from great recession 2.0, now occurring, to a bona fide econ depression. (My prediction in my 2010 book, ‘Epic Recession: Prelude to Global Depression’)

#USGDP (Mar 22)

If you thought Goldman Sachs’ prediction of 2Q20 GDP contracting -14% was shocking, then consider Morgan Stanley tonight predicting -30%. Meanwhile, McConnell blames Pelosi for not agreeing to a bigger bailout of big corps instead of her insistence on unemployment benefits

#Financialcrisis (Mar 22)

Stock futures trading for monday already halted after fallen the max. Fin. mkts in trouble are: repos, muni bonds, commercial paper, mortgage bonds, oil-commodity futures, residential mortgage bonds, forex, corp junk bonds/BBBs. Panicked investor ‘dash for cash’

#Bailout (Mar 22)

Big corps complain Congress’ bailout for them is not cash grants but loans. After they gave their investors, CEOs/Mgrs more than $3T in stock buybacks & dividend under Trump, 2017-19, now they’re broke? Small bus. need cash grants & workers 3/4 pay unemployment benefits.

#fiscalstimulus (Mar 22)

bill in Congress. No deal as of late Sunday. Democrats want more unemployment insurance, more small business support, and states. McConnell & republicans want more for big corps and no unemployment insurance increases.

#Bailouts (Mar 21)

Correct that: Airlines spent $48B on buybacks over 10 prior years; Boeing spent $43B from 2013-1Q2019. Airlines want $58B grant ($50B passengers, $8B cargo). Boeing wants $60B govt loan. (Boeing’s debt already >$40B. Loan would raise to >$100B)

#Bailouts (Mar 21)

Here’s another stat re. piggie airlines: 96% of their total cash flow for 10 years was used for stock buybacks! (i.e. their $43B buyback binge). And now that execs & shareholders spent it on themselves, they want $58B from Congress & us. Watch Trump give it to them!

#Bailouts (Mar 21)

Boeing wants $60B too. Spent $43B on stock buybacks from 2013-2019. Only suspended buybacks when 737max flopped in early 2019

#Bailouts (Mar 21)

Airlines are ‘pigs at the trough’. After giving their execs and shareholders $45B in stock buybacks in recent years, they’re now demanding $58B in ‘cash grants’ + more tax credits from Congress. If don’t get it, threaten mass layoffs by August. Boeing wants another $60B

#Fiscalstimulus (Mar 21)

Oops. Forget my earlier tweet of $2T package from Congress. Latest news: only $1.3T. (The rest due to assumed ‘multiplier’ effect). But ‘multiplier’ will be minimal as consumers stay home & use check to pay debt. (btw, only ‘some’ will get the $1k check from govt)

#Coronavirus (Mar 21)

Big shortage PPE for drs-nurses-hospitals. 2 reasons: 1. US corps offshored production to China (now with surplus, giving to Italy). 2. Trump’s 2018-19 trade war with China reduced inventory. What happens when Drs-Nurses get sick? Can’t replace them like masks, etc.

#Fiscalstimulus (Mar 21)

Rumor that Congress will vote on $2T bailout bill on Monday. That’s half what’s needed to bail out unemployed, small businesses, & local govts. Fed is already pre-bailing out banks with planned $4.5T liquidity to repos, munis, MMFs, Comm.Paper, etc. + QE for bonds

#Trump (Mar 21)

keeps saying he prefers corps stop stock buybacks. What about dividend payouts? (Together both=$1.2T in each of last 2 yrs). Will corps now getting $500B US bailout still be allowed to do buybacks? Trump doesn’t follow up his ‘wish’ with any enforcement proposals

#Trump (Mar 21)

keeps saying he ‘authorizes’ moratorium on foreclosures & evictions. But HUD today says it has no authority to enforce that until Congress passes a law. Trump’s ‘authorization’ just says he supports a law

#USrecession (Mar 20)

For my latest update on the crashing US economy, my critique of Congress forthcoming recovery proposals, and my alternative fiscal recovery program (phases 1 & 2), listen to my Alternative Visions radio show podcast today at
Alternative Visions

#USrecession (Mar 20)

JP Chase forecasts 2Q20 US GDP contraction of -14%. That’s more severe than worst quarter 1932 during the Great Depression when the contraction peaked at -13% GDP. US will have to raise govt spending from 21% to 40% of GDP as 1942 = $4t more on top of present $4.4T

#USrecession (Mar 20)

Goldman Sachs predicts 2 million to be laid off in March. That’s twice as fast as the monthly lay offs during worst months of 2008-09 crisis, and faster than in the aftermath of the 1929 stock crash and 1930-31 banking crashes.

#Trump (Mar 20)

In press conf. today Trump says he’d like to stop corp buybacks if they’re to get $billions US aid. Well, do it Donald! And stop dividend payouts too. How much buybacks+dividends under Trump? $1.2 trillion/year last 2 yrs. Obama also ave. $800B/yr for 6 yrs (Airlines $45B)

#USrecession (Mar 19)

Want to know how the current crisis of 2020 compares with the last, 2008, & both with the 1930s great depression? Read my Sept. 2018 article, “Comparing 1929 with 2008 and the Next” predicting the current crash, which is reproduced on my blog

#Oil (Mar 18)

crude oil now at $25/barrel. That means > $1T in energy junk bonds on way to default. If so, credit crunch contagion to spread across mkts. Fed announces full backstop for money mkt funds. This IS great recession 2.0 (or potentially even worse).

#USrecession (Mar 18)

Trump raises stimulus to $1.3T. Need more than 2X that. (see my ‘Cornavirus Economic War Mobilization’ plan http://jackrasmus.com) Meantime, Fed keeps pumping more liquidity into corps & mkts. No effect. Credit crisis here. Buyers say 45% chance junk bond default

#financialcrisis (Mar 17)

Treasury Secretary Mnuchin today warns that current financial crisis is ‘worse than 2008’. Jobless rate could rise to 20%. Believes Trump’s fiscal package will prevent both. He’s right about first two points, wrong about the third.

#Fed (Mar 17)

opens another money spigot to financial institutions today. To ‘shadow banks'(fin. institutions like mutual funds & brokers that aren’t regulated by Fed). $1 trillion a day now available to Repo mkts (added to $2.2T last wk. Includes ‘commercial paper’ mkt for mutual funds

#USrecession (Mar 17)

Read my call for a ‘Coronavirus Economic War Mobilization Plan’ along the lines of US war mobilization of 1942. Why we are now in an ‘Economic Pearl Harbor 2020’. (This post follows up my two preceding on need for a $2.2T immediate spending program & how to fund it)

#USrecession (Mar 17)

What US needs now is a ‘Coronavirus War Mobilization Budget’! In 1940 Govt spending was 16% of US GDP. By 1942 it was 40%. Since 1947 govt spending has been 20% of GDP. We need 40% now. See my $2.2T proposal “Addendum to Recovery Program’

#Fiscalstimulus (Mar 16)

As Congress debates how much to spend to save Main St.–and the Fed spends $2.2T immediately to pre-emptively bail out banks & investors–the economy crashes. Read my own ‘Economic Recovery Program’ proposal (+addendum on financing it)

#Fiscalstimulus (Mar 16)

Dems Senate propose $750 billion in emergency stimulus. Too little. $2 trillion will be needed (which is what the Fed just gave banks in free money today). Senate’s McConnell is delay and prevent the $750B, let alone more. WHy? US deficit already at $1.4T this yr

#USstocks (Mar 16)

Markets down -30% so far as of today from prior Feb. highs. My prediction: will decline -50% before current crisis is over. Other financial mkts? Global oil prices will fall within 30 days to $25/bb. Junk bond defaults in US oil patch are inevitable, and already begin

#China (Mar 16)

independent business research sources say China’s 1q20 GDP will contract 10%-15%, though it won’t report it as such.

#USrecession (Mar 16)

What’s the difference between a ‘normal’ recession (R) & ‘Great’ recession (GR)? Ans: Financial markets crash that deepens & prolongs R. Between R, GR & Depression(D)? D occurs after series of banking crashes, as in 1930, 1931, 1932, 1933 in USA

#USrecession (Mar 16)

Here’s an especially scary stat about unserviced debt that leads to default, bankruptcies & mass layoffs: the average days of available liquidity for millions of US small businesses is only 27 days! After that, if no sales revenue, default. Mass layoffs coming in May

#Fed (Mar 16)

rate cuts & QE not about stimulating investment; nor about stopping stock collapse. About preventing bus. defaults contagion to banks that then crash in turn. US not just in recession, but on cusp of another great recession with financial crash overlaid on real recession

#DemocratDebate (Mar 15)

Tonight in debate with Sanders, Biden announces his VP will be a woman. In recent days his team negotiating with Warren. Biden adopts Warren’s bankruptcy & college tuition proposals. Warren selling self to highest bidder. Any bets she’ll be his VP choice anyone?

#USrecesssion (Mar 15)

I’m going to venture here a risky prediction: that despite the massive Fed liquidity injection the financial markets won’t respond all that positively. They may read it as ‘the situation is worse than it appears’. Of course, I could be wrong (hopefully). We’ll see.

#Fed (Mar 15)

back to the future! Fed adds another $500B + $200B in QE purchases as well as 0% rate. After last week’s $1.5T repo purchase. Add all that $2.2T to Fed’s already $4T debt balance sheet. Is that October 2008 deja vu? Free money has no effect in across-the-board “Dash to Cash”

#FED (Mar 15)

just announced rate cut to 0%. Watch for more massive QE & QE lite & term auctions. Fed back to 2008 crisis mode. Question: will this placate or worry markets even more tomorrow? Other news: Calif issues order everyone >64 must self quarantine now. Entire state locking down?

#USrecession (Mar 15)

Minimalist measures being proposed by Trump & Dems to check deep threat of virus to US economy. No major fiscal stimulus program beside Fed & more tax cuts, which won’t work. Read my ‘An Economic Recovery Program: Theirs vs. Mine’ at my blog,

#Fed (mar 14)

watch Fed before mtg to announce a ‘term auction facility’ for shadow bank system, esp. mutual funds and commercial paper. Looks like parts of the banking system are already near freezing up but no one is saying it publicly. Fed action adds to its $1.5T for Repo mkt already

#Fed (Mar 14)

Trump raises again today his right to fire Fed chair, Powell. Wants negative rates like EU & Japan (now in recession; so much for negative rates). Powell capitulated to Trump a year ago & lowered rates; now will move to 0 & QE fast. Won’t matter. Trump looking for scapegoats

#USrecession (Mar 14)

Consumers (66% econ) all that held up US econ 4Q19. Now collapsing. How bad: not just empty store shelves. Now online delivery system being overwhelmed. What will families with babes & young children do? Trump-Pelosi only agree on testing. No econ stimulus yet.

#USrecession (Mar 14)

Replying to ‘economic denialists’ on this blog: $1.5T repo injection ‘not a stimulus’; so bank loans don’t boost economy? Must be ‘paid back fast’; so 1 & 3 mos. repo terms won’t be rolled over? ‘No hoarding’ going on; so corp credit line drawdowns for stock buying?

#Fed (Mar 14)

Next moves this week (after $60B/mo. & $1.5T repo injections already): talk of 1% rate cut (back to 2008 levels of 0.25%) + ‘term auctions’ (a la 2008) QE4. Will Fed go ‘all out’? Or wait to April? Former, if mkts tank again (and they will). It’s a (great?) recession stupid!

#Junkbonds (Mar 13)

Energy junk bond analyst (interviewed on Bloomberg) predicts 30%-40% of junk-laden US oil fracking corps could default this year, should oil prices remain at $30/bb or less for 3-4 more months. (Watch junk heavy retail & travel corps follow as well before year end)

#Coronavirus (Mar 13)

Why first test kits were worthless: they tested for antibodies, not virus itself. New kits test for virus direct. Expect big run up in cases. Viruses are RNA proteins, that take over DNA in our cells. They’re insidious little bastards. And they change (mutate) often

#TreasuryBonds (Mar 13)

liquidity problems in the Repos. Why. Hedge funds took over much of role of banks as intermediaries in repos. Are hedgies now requiring more cash to cover positions elsewhere? Or banks needing more liquidity to service clients’ drawing down credit lines? Or other?

#TreasuryBonds Mar 12)

Why did T-bond rates rise this week, despite stocks collapse? What’s up? Hedge funds in the Repo mkt speculating with Treasuries leveraging bets on interest futures trades, the latter now unwinding due to their losses. Is Fed’s $1.5T repo injection to cover losses?

#stockmarket (Mar 12)

How much did the record 11 yr. stock market bubble create for investors (from Mar 6, 2009 to Feb. 19, 2020)? more than 500%.

#China (Mar 12)

& emerging markets. What’s going on there? Devaluing currencies and dollarized local bonds imploding. Think Argentina & Brazil in trouble now? Just wait. Collapsing currencies & trade means no import purchases. And then there’s China ….

#Creditcrisis (Mar 12)

Accompanying the panic rush to liquidity (i.e. sell off all other assets & hold cash), aka liquidity preference (Keynes) is the related ‘liquidity trap’–i.e. providing more liquidity results in just hoarding it, rather than investing or spending (households) it

#Creditcrisis (Mar 12)

Business media reports (Bloomberg) that the Fed has injected now $5 trillion of liquidity into markets to try to prevent liquidity crisis. The ghost of Keynes (liquidity preference over all other assets) now stalks the corridors of Corporate America everywhere!

#Gold (Mar 12)

Gold prices fall instead of rise. Reason? Same as for ‘safe havens’ like US Treasuries. Investors’ panic flight to hold cash. As Keynes would say: liquidity preference is trumping (no pun intended) demand to hold all other forms of non-cash assets, including the ‘safest’.

#USTreasuryBonds (Mar 12)

The $16T market for US Treasuries acting strange. US stocks fall 2,200 pts & Treasury rates rise (and prices fall). Not vice-versa. Reason: Flight to hold cash everywhere means investors cashing in T’s after big gains=excess supply & price decline & T rates rise.

#Coronavirus (Mar 12)

Head of Harvard Health School today on PBS estimates 40,000 US infected within 2 weeks. 10,000 right now. US worse response of advanced economies. Big problem with testing.

#Repos (Mar 12)

Trump said last night “it’s not a financial crisis”. Why then has Fed announced today a $500B injection into 1 mo. repos + another $500B 3 mo. repos? Reason for $1T ‘QE by another name’: corps drawing down bank credit lines at record levels to hoard cash as revenues crash

#Junkbonds (Mar 12)

The high yield (junk) corporate credit default swaps (CDS) index escalates to 10 year high now in just few days to insure against junk bond defaults (energy, retail, other). Watch for contagion to spread to BBB corporate bonds. But Trump said “not a financial crisis”

#Junkbonds (Mar 12)

For all you finance guys/gals out there: will oil patch high yield(junk) corporate bonds+Junk ETFs(2020 crash)become new subprime mortgage+CDS(2008 crash)? Or will it be oil futures? Repos? India banks? Italy’s? Japan’s central bank ETF losses? Black swans are flocking

#Trump (Mar 11)

bragged about the millions of test kits on the way. Calif. Governor Gavin Newsom said today the test kits California got came without the ‘reagent’. So can’t be used. It’s like sending a printer without the ink and saying write me a report Gavin about how well it’s going

#Repos (Mar 11)

Fed worried re. liquidity, increases one day Repo injection to $175B. (Meanwhile, Trump walks back some of his speech errors in a tweet, saying the freeze on travel from Europe to the US does not include cargo & freight. (It doesn’t have to go through London to get to US)

#Trump (Mar 11)

what do US markets think of Trump’s speech and travel ban? Dow futures down 1124 pts so far. Another -8% one day drop coming maybe?

#Trump (Mar 11)

says on Tv that “testing is expanding rapidly”. But Grand Princess incubator boat in Calif. testing only those with symptoms. Most of 2500 without symptoms told to go home. Not enough tests. (Compare: China tested 200K per day; S. Korea 15K/day. US so far 5k in past 4wks)

#Creditcrisis (Mar 10)

For my analysis of how deflating US-global financial asset mkts may lead to a US corp junk bond’/BBB/leveraged loan credit crisis, read my article, ‘Global Deflating Financial Asset Prices: Prelude to Next ‘Great Recession’ at my blog, http://jackrasmus.com.

#Banking (Mar 10)

watch out for global banking crises brewing: India shadow banks defaults. $10T non-performing bank loans global. Bank of Japan’s stock-buying QE program ($279B in stock ETFs) in big trouble, as it loses 14% of its assets. Medium size US banks in US oil-junk bond patch

#Fiscalstimulus (Mar 10)

Trump waffles on how to stimulate US economy now entering recession. Here’s what conservative Enterprise Institute says: “A little loan here and a payroll (tax) cut there – they are thinking far too small. They should be thinking this is a global financial crisis”

#USshale (Mar 9)

In response to Saudi price cut (their real target is US shale not Russia), US shale producers say they can still remain profitable at $31/bb. Texas crude now at $34. Saudis will keep driving lower prices until Shale with junk bond default & clear out some US players

#Repomarket (Mar 9)

To ward off a possible credit crunch the Fed boosted overnight Repos from $50B to $150B and 14 day Repos from $20 to $45B. In other words, QE lite by another name! Since last September Repo crisis Fed has pumped more than $500B into the market

#Coronavirus (mar 9)

Italy. Infected now 10,000 and deaths rise 25% in one day. Italy now more infections than So. Korea or Iran. Politicians announce ‘lockdown’ on entire country. No one is supposed to go anywhere. Sure. Let’s try herding cats. (not to say Italians are feline, of course

#financialcrisis (Mar 9)

US Dow down 1650 pts(-6%)mid-day. Asia mkts -6%. Oil futures<$30/bb. Spillover to credit mkts coming: $5T US junk/BBBs (energy, retail, then other). US now in recession. (Ditto EU, Japan, S.Korea, ANZ, Latin America, etc.) Bank crash India. Watch Fed more Repo+QE

#Corporatelending (Mar 9)

Global financial asset crash underway, soon to impact credit mkts starting with US junk in energy (oil fracking) and retail (big box), spilling over to rest of junk, then BBBs (most really also junk) and even I-grades. Dow down 1500. T’s all < 1%. Big QE coming

#Oil crashing. (Mar 8)

Saudi-OPEC declared ‘war’ on Russia. Lowered price 20%+ overnight. Saudi to pump 12mb/day, up from 9.7m Feb. Talk of oil prices falling to $20/bb. If so, many US shale producers go bankrupt. Energy junk bonds default. Retail junk bonds & leveraged loans next.

#CoronavirusEurope (Mar 8)

Reports now coming out that Germany last three weeks has had 40,000 ‘flu’ cases with 200 flu deaths. 3X normal. Could these have been coronavirus? Italians in north in exodus to south to flee virus in Lombardy-Milan region. How many will now spread it south?

#FinancialCrash (Mar 8)

now underway?? Oil falls to $30/bb today. US Stock futures down $1200 pts. 30-yr Treasury bonds fall to less than $1. Unprecedented financial asset crashes now in progress.

#CoronavirusUSA (Mar 8)

As US tested cases rise in hundreds, actual much higher. Why? Workers fear to get tested & told to stay home, with no paid sick leave, missed paychecks, no savings, unaffordable hospital deductibles (Drs. refusing office visits of infected), insured high ded/copay

#Oil (Mar 8)

Latest failed Russia-OPEC deal to cut output causes -9.4% collapse oil prices. High price Brent crude now $45/bb. Spilling over to stock & other financial asset prices: mideast stocks fall 8%-10% one day! Watch for falling oil to impact US energy junk bond mkt then BBB bonds

#Coronavirus (Mar 7)

Infections in Italy & Germany rising fast. Italy 6000 cases now, with 1200 in one day yesterday. Lombardy-Milan region ‘locked down’. Germany cases rise from 66 to 1000 in one week. So. Korea more than 7000. US East coast cases rising. Goldman Sachs says 2Q US GDP 0%

#USDeficits (Mar 6)

& social security cuts by Trump after Nov. In Scranton, PA today Trump said, “We will be cutting. It was not immediately clear whether he was referring to the mandatory spending programs, discretionary federal spending or both.” Source: Associated Press, March 6,

#globaleconomy (Mar 5)

China was center of virus crisis. Is India becoming center of next global financial crisis? Shadow banks failing, rupee declining, stock markets falling. No end in sight. What’s the financial contagion effect worldwide? Potentially bigger economic story than virus

#Fed (Mar 5)

quickly cuts rates 50 basis pts. Trump calls for more & says follow EU/Japan rates lower. Takeaways: Trump wants neg.rates; Fed now tail-ending financial mkts; Mkts ho-hum response so far to cut; except for res. housing, rate no effect on real econ; rate policy dead in water

#Fed (Mar 2)

Can Fed rate cut stop severed supply chains, falling foreign demand for US exports, US consumer hoarding, coming layoffs, crashing commodity prices? Absolutely nothing. Why rate cut then? Stop collapsing US stock & financial asset values. But that’s not its mandate, right?

#Fed (Mar 2)

Confirmed rumors that the Fed will cut rates wed. by 50 basis pts has turned stock prices around today. But the ‘buy the dip’ is weak. And money keeps flowing into safe haven Treasuries. This is ‘dead cat bounce’ week for stocks. As US econ weakens, decline will resume.

#Fed (Mar 1)

rumors growing of a Fed rate cut this week of 50 basis pts or .5% (lowering rage to 1%-1.25%), and coordinated with offshore central banks cuts as well. All designed to stop the freefall in equity prices. But wait! The Fed doesn’t target asset prices, right? Yeah, sure.

#stockmarkets (Mar 1)

More 500-1000 pt falls next week. Why so fast? Artificial run-up in stocks from Trump tax cuts boosting profits 25%, diverted mostly to fin. mkts as $1.2 trillion buybacks+dividends in both 2018 & 2019. Tax cut driven profits now disappearing. 2020 earnings now neg.

#Contagion (Mar 1)

Economic contagion deepening. Financial asset prices plunging everywhere. If continues, watch defaults in junk bonds & leveraged loans–starting with US energy & retail sectors. New financial crisis growing possible. As in 2008, followed by major real econ spillover

#coronavirus (Mar 1)

Confirmed cases in Italy surge more than 500 in one day! From 1128 to 1694. A week ago: 0. US-Trump still not stopping flights. Watch for ban on flight from Europe within weeks. Report of 60,000 ship containers locked up in wrong ports or on freighters offshore

#Chinaeconomy (Mar 1)

Predictions growing from legitimate sources that China’s economy will contract 1Q20 by -2% to -14%. Deep contractions Europe & Japan also. Global recession is here. Only question: how soon will it spill over to US.

#coronavirus (Mar 1)

Italy infected with 1128 cases, with 29 deaths, up from 0 week ago. More than 250 cases per/d reported, rising fast to=Wuhan’s 470 cases per/d. US deaths in Washington state, as new pocket in nursing home. Calif. shoppers clearing out grocery stores of cleaning goods

#coronavirus (Mar 1)

Unless it’s an N95 mask it’s totally worthless. Even with N95 masks, most contagion spread by virus on surfaces of objects and then touched with hands or other body parts.

#coronavirus (Mar 1)

Confirmed transmission from Italy to Canary islands and Mexico, due to visitors from Italy. Trump-US policy announced to ‘screen’ travelers from Italy means only those with symptoms. Not tests. Trump says US has 43m test kits. Calif. says it’s been given only 200.

Dr. Jack Rasmus
@drjackrasmus