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Coronavirus - No, You Do Not Hear the Fat Lady Warming Up

Politics / Pandemic Mar 31, 2020 - 05:44 PM GMT

By: The_Energy_Report

Politics

Bob Moriarty of 321gold comments on where he believes the economy is heading.

Those who never predicted a financial collapse in the first place are now edging closer to the swamp to dip their toes into the water. Now they are suggesting, perhaps we could have a recession."

Forget that. You cannot have every supply chain in the world chopped in two and have a recession. A depression was baked into the cake before the Corona popped out of the six-pack. The US government dumping a $6 trillion dollar bailout for their buddies that has more pork in it than the butt of a two-ton pig is the proverbial pissing up a rope. We are in a depression. The entire financial system, education system, medical system, political system, hell, the entire artifice needs a total reset.


What do we get? More of the same. Well, if the government created the workspace for the depression by unlimited debt and financial chicanery, you are not going to fix it with more of the same.

Americans are unlike any other people on earth. At heart they want to trust their government. Granted, the Democrats understand that the Republicans are at the heart of all evil. And Republicans know full well that the Democrats caused all of the problems in the country but both agree that if only we elect their pet fools, all would be well with the world.

No other country on earth actually trusts their government. Their people growl and on occasion turn out in the streets to man the barricades but they know deep in their hearts that their "leaders" are fools who can do nothing well. Americans are always shocked to find their elected representatives are idiots. The rest of the world simply assumes stupidity and cupidity on their behalf and find themselves rarely disappointed.

Ignore the virus for a moment. True, it will kill tens of millions of people but everyone alive is going to die someday anyway. All the virus will do is accelerate the process. Some of those who survive will figure out how to cope.

The depression is another story. Already pundits are suggesting that investors should buy the dip. The FDIC actually put out a video saying, your money in the bank is safe. Do not withdraw your money. Are you kidding me, they really said that?

I'm told the FDIC chairman who actually put out the video was confused by the message. She stated in the first take of the video that "we are proud of the fact that since 1933 no American depositor covered by the FDIC ever lost a cent up until now. That's a 99% success rate for us." Naturally they had to brief her and rewrite her lines.

The message was clear. Just moments before a bank closes the president of the bank says, "Your money is perfectly safe in our bank." And then slams the door forever.

Banks are going to close. The financial system may well shut down for a period. Lots of investors will go to bed rich and wake up poor.

Buying the dip is probably a really bad idea. We have had a crash. We have had a dead cat bounce and we are about to go back to the crash mode. Nothing at all has been fixed.

Between now and the end of this year I suspect the total drop will be between 85 and 92%. It could be worse. In the case of resource stocks, when the margin clerk calls, everything gets sold. Everything.

I have a lot of core positions of stocks I love. I will be putting in stink bids 20% lower than the close of shares I like the day before. While drops of 20% are common, drops of 25% are not. The value of these shares has not changed at all, only the price. Actually that's not totally true, the latest $6 trillion piggy giveaway pretty much guarantees higher prices for real assets in the future. Keep some cash for screaming deals.

Rely on yourself, your family and your friends. The government is not your friend, not now, not ever.

Bob Moriarty President: 321gold Archives 321gold

Bob Moriarty founded 321gold.com, with his late wife, Barbara Moriarty, more than 16 years ago. They later added 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. Previously, Moriarty was a Marine F-4B and O-1 pilot with more than 832 missions in Vietnam. He holds 14 international aviation records.

Disclosure: 1) Bob Moriarty: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: None. I determined which companies would be included in this article based on my research and understanding of the sector. 2) The following companies mentioned are billboard sponsors of Streetwise Reports: Wheaton Precious Metals. Click here for important disclosures about sponsor fees. 3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy. 4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports (including members of their household) own securities of Newmont Goldcorp, Franco-Nevada and Royal Gold, companies mentioned in this article.


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