Maryland Imposes a Pandemic Curfew

In Maryland the governor has issued a shoot to kill order on anyone out between 8 pm and 8 am. Or arrest and fine. One of those.

Hollywood Dog Trainer Carl Spitz

Terry, a Cairn Terrier trained and owned by Hollywood dog trainer, Carl Spitz, was in the 1934 Shirley Temple movie "Bright Eyes” some 5 years before she appeared in The Wizard of Oz. Terry was trained to respond to silent hand signals.

Carl Spitz was a German immigrant and student of Germany’s Colonel Konrad Most who was one of the first professional dog trainers who pioneered many of the dog training techniques used to this day.

Carl Spitz opened his own Hollywood Dog Training School in 1927. He later helped set up America's WWII War-Dog Program.



Carl Spitz trained “Buck” to star in the 1935 adaptation of Jack London’s Call of the Wild with Clark Gable and Loretta Young.

The Wee Turtles are Looking to Lay Eggs

Wee turtles were leaving the canal and crossing the tow path to lay eggs in the woods. The big turtles will trundle out later.

This Is How God Learns

Face Masks Save Lives

Social distancing and face masks save lives. Wash your hands. Carry a bleach and water-soaked washcloth in a plastic bag in your car, and wipe off entering and leaving every time.

Trump Will Kill Thousands of Americans

So That's Where All the Toilet Paper Went

Fire Up the Fox News Crack Pipe

Possums for Sale, New York City, 1916.

Americans look down their nose at the fraying ends of other cultures, with little reflection on our own.

In America, we hunt and eat every kind of wild animal, including animals so similar to humans they are used as body part replacements for living people.

You did not know?

Now you do

They eat snake in country XYZ?

They eat snake in America too (as well as giant lizards).

They eat rat in country XYZ?

We do too. We even have Muskrat beauty queens, Nutria festivals, and possum fries.

In America, the main religion is based on a talking snake.

Adherents are told they are mud people cursed by a mass-murdering god who sent his “son” to be murdered before he returned as a zombie. To show their fidelity to this story, practitioners of the faith wear a copy of the murder weapon of their messiah around their neck.

It’s strange stuff, but Americans manage to bridge the gap by never reading.

My father’s job was to explain America to the rest of the world — how a country that said “all men are created equal” could in fact be the same country that built its economy on slavery and institutionalized racism and sexism.

Strange stuff.

How do you explain that the country that says it was “founded on the rule of law” somehow forgot to teach about the stolen lands and broken treaties?

Do people not know that the “rule of law” (and supporting religious texts) made it legal to own slaves and disenfranchise women?

And now we face a new spate of xenophobia because a foreign microbe has been unintentionally spread around the world?

Ha! There’s a story the Chippewa, Choctaw, Cherokee, Sioux, Navajo, and Hopi have heard before, only this time no blankets seem to be involved.

And what is the solution?

Why, it’s not to rush out and provide free health care for all, is it?

No. Instead the politicians who only a month ago were demonizing Medicare For All as “socialist healthcare” are pushing a $7.5 trillion government bailout, mostly directed towards Wall Street and big corporations.

Apparently socialism is needed to save capitalism, but it can’t be used to save you.

Get sick with Covid-19?

Even if you survive a hospital stay, the bill is likely to kill you.

Think most Americans have thought about any of this?

Nope.

We don’t read much. We don’t Google.

Instead, we believe in American Exceptionalism, which appears to be one hell of a drug.

Fire up the crack pipe; let’s see what’s on Fox News.

Benny Rothman, Who Created the Right to Roam

In the U.K., folks can wander over private property without asking permission.

This is called “the right to roam” and its legal legacy can be traced back to a grassroots movement started by Benny Rothman in the 1930s.

Rothman was a member of rebellious group of Manchester factory workers who called themselves “ramblers”.  The ramblers sought to get out of sooty Manchester on their time off in order to see the beautiful Peak District that surrounded them. The problem was that almost all of this land was in the hands of private landlords who hired game keepers to keep walkers (and possible poachers) at bay.

This had not always been the case. Some 300 years earlier, most of the land in the UK has been part of the Commons where people could graze livestock and hunt as they could.

Beginning in the mid-18th century, however, the Enclosure Movement worked to privatize most common land in England, Scotland, Wales, and Ireland. This has been described as "a revolution of the rich against the poor," and it transformed the countryside and shaped the world of dogs in general, and terriers in particular.

Benny Rothman was a member of a rambling club called the British Worker’s Sports Federation. One day while he was out with friends from that group, they were chased off by gamekeepers employed by the landowner. Benny and the other ramblers had had enough, and they decided there had to be strength in numbers.  If enough folks showed up, the game keepers employed by absentee landlords couldn’t possibly stop them. And so Benny Rothman gathered up a big group of ramblers to walk up a small mountain called Kinder Scout in order to prove the point.

Gathering in a quarry at Kinder Scout, Rothman stood on a large rock and talked about the rights that the common working man had lost during the Enclosure Acts. He emphasized that the trespass they were about to do on Kinder Scout was meant to be peaceful.  With that said, and the rules of the mass trespass detailed, they set out up the mountain. The game keepers, of course, did show up and there was a brief scuffle before the outnumbered game keepers retreated.

BennyRothman addressing the group at Bowden Bridge quarry, 1932

That would probably be the end of the story, but the game keepers called the police who came to arrest the six ringleaders as they came down the mountain.  Five of the six arrested were given prison sentences of two to six months.

While arrest is never good, it can have an impact.  In this case, the effect was to propel the mass trespass on Kinder Scout into the national news, where it received a great deal of popular support. Soon there were more mass trespasses, and in 1951 Britain opened its first national park, not coincidentally located in the Peak District where so much trespass activity had been occurring.

In 2000, the Ramblers got what they had always sought; an act of Parliament that created the right to roam.  Happily, Benny Rothman lived to see that day; he died of a stroke in 2002 as the age of 90.

Lukas Saville writes to let me know he has written a detailed and accurate guide on Kinder Scout, that has information about the location, a thorough route guide, and even GPS coordinates anyone can download for free. Check it out.

As It Was: Japanese Falconry in the 1860s

The Museum of Fine Arts in Boston has digitized a Japanese falconry book from the 1860s entitled Ehon taka kagami, or An Illustrated Mirror of Falconry.

The woodcuts, by Kawanabe Kyôsai, shows falconry equipment and training methods, as well as the Siberian goshawks that 19th-century Japanese falconers favored. 

Some copies of Kyôsai's prints were printed with flecks of mica embedded in the paper in order to lend sparkle to the bird's feathers.

John Steinbeck Reads "The Snake"

John Steinbeck reads his great short story "The Snake"

8.3 MB file which can be downloaded.

This is a true story, told by John Steinbeck about his friend Ed Ricketts (aka Dr. Phillip in the story).

A Vaccine Race ... With Dogs

The Iditarod Sled Dog Race was one of the few spring 2020 American sports events not cancelled or postponed by the 2019-20 coronavirus pandemic.

The winner: Thomas Waerner of Norway and his dog team, who completed the 1,000-mile race in 9 days, 10 hours, 37 minutes, 47 seconds.

Waerner is the fourth non-Alaskan and the third musher from Norway — the second in three years — to win the Iditarod.

The Iditarod Sled Dog Race commemorates the 674-mile 1925 diphtheria serum run to Nome completed by 20 mushers and about 150 sled dogs in 5 ½ days, saving the small town of Nome.

When was the diphtheria vaccine first created, and what’s that have to do with dogs? See here for that story.

Kill Yourself to Own the Libs?

Best Local Store Sign

Get yours here.

Dogs Are Not Good at Public Policy

"Sacrifices Will Have To Be Made"

It’s time for Republican Senators over age 60 to voluntarily and intentionally infect themselves and their spouses with Covid-19 in order to show they are willing to sacrifice themselves for an uptick in Boeing stock prices.

This intentional infection should start in 2 weeks when the hospitals are already swamped with Covid-19 cases, and the senators should be required to attend local hospitals without any form of special treatment.

The voluntary infected should include: Mitch McConnell, Chuck Grassley, Lamar Alexander, Lindsey Graham, Susan Collins, Ron Johnson, John Cornyn, Marsha Blackburn, Richard Burr, Jim Inhofe, Richard Shelby, Pat Roberts, Jim Risch, Lisa Murkowski, John Boozman, Rick Scott, David Perdue, Mike Crapo, Mike Braun, Jerry Moran, Bill Cassidy, John N. Kennedy, Roger Wicker, Cindy Hyde-Smith, Roy Blunt, Deb Fischer, John Hoeven, Rob Portman, Mike Rounds, Mitt Romney, Shelley Moore Capito, Mike Enzi, and John Barrasso.

Within the Trump Administration, the over age-60 voluntarily infected and their spouses should include: Donald Trump, Mike Pence, Bill Barr, Mark Meadows, Sonny Perdue, Wilbur Ross, Ben Carson, Elaine Chao, Betsy DeVos, Peter Navarro, and Gina Haspel.

Hopefully, these folks will survive infection and will be able to return to work without permanent lung scarring. Mortality for the over 60 varies by age, but if we assume a 4 percent mortality rate, only 4 or 5 of the above-named individuals and their spouses should die, and just think what a massive political statement it would make about their faith in God, their belief in sacrifice, and their commitment to Boeing stock prices.

Counting the Uncountable During the Pandemic

Back in 1986, I was the organizer of a session on census adjustment at the annual conference of the American Association for the Advancement of Science. The topic of the panel had to do with census reapportionment for congressional seats. If the courts decided to exclude illegal immigrants from the count, how could that be done? How did we count permanent resident green card holders? Did we count them at all? And what about the millions of young black men who, for whatever reason, were always missing in census counts? Was a deep sample survey actually more accurate than a nose-by-nose count?

All good questions, but before we got too far into the thicket, I wanted to prick a few balloons.

I began the panel by noting that in 1980 the U.S. Census Bureau had counted exactly 226,545,805 people, but that the margin of error that the Census Bureau freely admitted to was 2.5 percent.

In short, I observed, the one thing we had some confidence in was ... wait for it ... wait for it .... that only the first digit of that big official number was probably right. All of the other digits in the apparently precise official count were subject to change based on the Census Bureau’s freely admitted margin of error.

I tell this story to stress that folks who do not work with numbers, day in and day out, tend to fall in love with false specificity.

We don't have an exact count on a lot of things. The good news is that even if we do not have a precise count, we have direction and velocity data, and some ballpark numbers which, it turns out, are good enough for most policy purposes.

I bring this up in the era of coronavirus testing and mortality and stock market and other economic loses resulting from the same.

How many people have *really* contracted the disease in the US, since testing has been slow and bungled, and a portion of the population is asymptomatic and also contagious?

How many deaths are *really* due to Covid-19, when so many patients are presenting with co-morbidities and some early deaths were (apparently) coded as seasonal flu?

Is the Dow Jones weighted too much on airlines, and therefore suggesting more economic collapse than is real?

Is the S&P 500 masking real economic loss at the level of barbers and non-chain restaurants and gyms, coffee houses and bars whose “stock” is not traded on any exchange?

All good and interesting questions, but again ignore the false specificity, and instead look at direction and velocity.

Is the data that you do have going in one direction?

Is it slow, fast, or variable?

Is there a doubling time?

Are curves flattening?

If the answer is “a lot” and “more” and “pretty damn fast,” you don’t need to know anymore.

Compounding is a mathematical construct.

The math behind both doubling times and halving times is the same, and it has no ideology.

A human population that grows at 2 percent a year doubles in just under 35 years based on the natural log of 2.

By the same calculation, if you have a steady rate of financial return of 7 percent, your money will double in just shy of 10 years.

The spread of coronavirus is jaw-dropping. It is not doubling in years or months or even weeks, but in 6-7 DAYS.

The good news is baked into the bad news: that speed of transmission will slow, but only when a sizable portion of the population has antibodies due to having caught the disease and survived it, or having been vaccinated.

“Herd immunity” kicks in when about 75 percent of the population carries antibodies. In all liklihood a vaccine will only kick in a year or 18 months from now, by which time we can expect 3.5 to 5 billion people across the globe to have been infected, with 35 to 50 million dead as a result of that infection.

It’s possible an antibody-based vaccine can be developed before then, but it would also have to developed and rolled out at a global scale within the same time period to sharply reign in the numbers.

And there’s another Joker in the deck: Covid-19 is a “slippery” virus that seems to mutate easily.

The first mutation enabled the virus to spread easily from people-to-people, and the second created a new, even worse, strain of the disease that is now being seen in the Middle East.

With two strains of the virus now circulating, we don’t know if recovery from one strain confers immunity to the other.

A rapidly spreading double infection, and a virus that shifts quickly, “slipping” out under a vaccine, is an epidemiological nightmare.

Is that in the future?

We don’t know.

All we know now is direction and velocity, and that’s enough.

Numbing Numbers Ahead

Federal Reserve Bank of St. Louis President James Bullard says U.S. unemployment rate may hit 30% in the second quarter, and GDP may fall 50 percent.

The chart, above, is of nationwide unemployment claims as of Thursday (four day ago).

THIS IS THE START, not the end.

Play Stupid Games, Win Stupid Prizes

Stay in your house, wash your hands aggressively every time you come back to the house, try not to touch anything, practice social distancing, do not touch your face, and carry a clorox-soaked washcloth in a plastic bag in your car.

Compared to What?

Coronavirus Cannot Touch Keith Richards

This is funny, but I am genuinely worried about seniors all over, starting with family and friends.

On the musical scene, Loretta Lyn is 87, Willie Nelson is 86, Charley Pride is 85, George Jones is 81, and Mavis Staples is 80. Bob Dylan is 78 years old and Chet Atkins, Paul McCartney, Paul Simon, Art Garfunkel, Carole King and Brian Wilson are 77. Mick Jagger is 76 and Keith Richards, Joni Mitchell, Roger Daltrey, Jimmy Page, Roger Waters, and Ray Davies are 75. Debbie Harry, Eric Clapton, and Rod Stewart are 74, and Neil Young and Dolly Parton are 73, as is Van Morrison.

A similar list could be done for much-loved politicians, comedians, actors, business, and local leaders.

Not Hunting: Someone Tell the Dog

I was walking the dogs and checking on an eagle nest when Moxie found a possum. I could not understand why she didn’t pull it, but when she finally broke off, it was self-evident: the hole was cross-braced by a two-inch thick root. Not sure how the possum got in, but it was not coming out that way. Moxie was no worse for wear — not a mark on her. That said, never pull on a dog that is gripping unless you can see who has who — you don’t want to pull your dog’s face off. The possum was left in the hole; no digging on this day.

Signs of the Times

The boys at the Fort Detrick biological weapons lab up the street are dressing funny. What’s it mean?

It's the Real Thing

Custom Coke bottle for $5 a unit.

Stephanie Ruhl on the Train About to Slam Us All

The train is already starting to small things locally, with jobs and income being lose across the area.

And it's not all small employers taking the hit either.

Last night, Marriott announced it was going to being furloughing tens of thousands of employees, including many thousands at its corporate headquarters in Bethesda. The Daily Beast describes hotels as "coronavirus ghost towns" and the industry is looking for a $150 billion bailout, with the head of the American Hotel and Lodging Association describing the pandemic as already (and it is still early days), having a bigger impact that 9/11 and the 2008 recession combined.

Fishing With the Dogs

You can stay completely shut in for only so many days. . . . so you go out and still maintain social distance.

This fishing kit is pretty minimal: a 4-piece Eagle Claw pack rod that slides into a PVC tube, a repurposed Indian lunch box with weights, hooks, flies, lures in the top compartment and worms (or whatever) in the lower, and a simple spin reel (or fly reel if the cover is amenable). Cheap, simple, and it works. 

Everything -- along with dog leashes, two e-collars, and a bike lock -- fits into the front bag where the camera normally sits when I am not fishing.

Down on the Farm

Point of Rocks Train Station

The Wee Wolves and I biked to Point of Rocks commuter train station from Noland's Ferry.

We All Serve In Our Own Way

Love Birds

It's almost nesting time -- April.

People Will Make Bad Decisions

Great Blue Heron Trying to Hide

Great Egret and His Reflection

These are birds easily spooked, and this was shot (hand held) at some distance using my point-and-shoot.

Social Distancing Swallows

Swallows on a wire above a marsh today. They migrate to Brazil, Bolivia and Peru in winter.

Act As If Live Lives Matter -- Maybe Even Your Own

We Stink Of Death

“No pain, no death is more terrible to a wild creature that it's fear of man…. A poisoned crow, gaping and hopelessly floundering in the grass, bright yellow foam bubbling from its throat, will dash itself up again and again onto the descending wall of air, if you try to catch it. A rabbit, inflated and foul with myxomatosis,... will feel the vibration of your footsteps and will look at you with bulging, sightless eyes….

“We are at the killers. We stink of death. We carry with us. It sticks to us like frost. We cannot tear it away.”
- J.A. Baker, The Peregrine

The Bad News Is I was Wrong

Let me start with Paul Samuelson.

Samuelson, who was awarded the 1970 Nobel Prize in economics, liked to quote John Meynard Keynes who, according to Samuelson, was once challenged for altering his position on some economic issue.

“When my information changes,” Keynes replied, “I change my mind. What do YOU do?”

I tell this tale because back on February 27th, I wrote a piece entitled The Good News Is the Bad News Is Wrong.

Guess what? I was wrong.

Based on the best information available at that time, I wrote that "Trump is right" and that "The coronavirus is serious, but it’s very similar to SARS, and that global issue was contained with few deaths and no outbreaks after the first 15 months back in 2002-2003."

I was right about SARS, but coronavirus has proven to be far more communicable and serious a respiratory disease than anyone outside of China imagined.

This is not to say I was entirely wrong. I wrote that "This is going to be a virus that rockets around the world, and makes a lot of folks (millions) miserable for a week to 10 days, but this is not the Bubonic plague, and it’s not 1350."

That is still true, but it's not going to be a walk in the park either.

In late February I did not understand the scale and the social ramifications of what was coming. I wrote that "Yes, there will be a brief rumble in trade and transportation, but it will not last too long (a few months), and hand-washing protocols and a closing of Asian wildlife markets will benefit all. I am keeping my money in the stock market." (emphasis added) 

Just two weeks later, I had sold all my stock and converted it to cash.

I was slow to catch up, but a visit to the Baltimore Docks on March 9th convinced me.  On that day Amazon cancelled my tour of their Fulfillment Center without notice.  While in Baltimore, I looked at the dock cranes standing idle.  Something wicked this way walked. 

I could see it.

Since February 27th:

• Bars and restaurants in most states are being closed by order of  the Governors.
• The Vatican and Mecca are closed -- Easter celebration and the Hajj are both called off.
• Major league sports teams are ending their seasons, or not starting them at all.
• Public and private schools are closing, and so are colleges and universities. There will be no graduations or proms.
• Las Vegas has closed down, and so have TV shows with audiences. News shows are interviewing guests remotely, and reducing production crews to keep people healthy.
• Police are no longer arresting people; just giving them warrants for future court appearances at a date to be determined later.
• Concerts around the world have been cancelled, and the 2020 Summer Olympics will not happen.
• Starbucks locations around the world are now closed, and Costco is no longer taking cash in order to reduce disease transmission.
• The Trump Administration pumped $1.5 trillion (trillion) into the economy and it disappeared without leaving a trace -- like flash paper blown into a blast furnace.
• Public and private transportation from metro to Uber, from Amtrak to Delta, from cruise ships to shuttle buses, has mostly been shut down, with the big companies already asking Uncle Sam for economic bailouts.
• The docks in Baltimore, Newport News, and San Francisco are operating at deeply reduced levels, as ships are no longer being loaded overseas.
• Factories in China have stopped production to the point that the air is cleaner. Tourism in Italy and France has all but stopped.  Borders across Europe are now closed, as is the border between the US and Mexico and the US and Canada.
• In the US, unemployment jumped by 2 million last week alone, and experts say we can expect it to hit 20 percent or more, resulting in lost income and folks liquidating their 401-Ks in order to hold on to houses and apartments while paying off credit card debt and feeding themselves.

On March 3, I predicted that some of this would happen (docks slowing, supply chains interrupted, concerts and travel curtailed), but I did not yet grasp the full magnitude of the global shut down.

I wrote that "In most places, things will get worse before they get better but 'worse' will not mean massive numbers of fatalities outside the bounds of a bad flu season."

I was wrong.

On March 6th, five days before I sold my stocks, I was still whistling past the pandemic, trying to convince myself that this was going to be something we could rope in and suppress, like SARS, Swine Flu, AIDS, and Avian Flu.  

I have always said this pandemic would rip BIG in term of the total number of folks who would catch it.

But the 100,000 cases worldwide and the 3,400 deaths (so far) puts this in the "flu data" arena. For comparison, as many as a billion people a year catch the "regular old flu," and 400,000 to 600,000 people a year die of it (including 9,000,000 to 45,000,0000 Americans with 10,000 to 60,000 deaths).

New data from China suggest people may be asymptomatic for as long as 28 days after infection. What this means is that this virus may be even more difficult to contain than we thought, and that the denominator of current carriers may be very big.

What's that mean? Hard to tell right now, but widespread testing in South Korea shows a real-world mortality rate in that country of just under 1 percent and US officials are quickly moving their fatality data southward, as I said they would.

Though I was growing more cautious, I still felt that "This looks to be a molehill being made into a mountain by folks who have little or no understanding of risk assessment."

I was wrong.

On March 13, two days after I sold my stock, a draft HHS report on Covid-19 said massive economic and social shutdowns were required and would have to last at least 18-months to stem a surge in sickness that would swamp hospital capacity. Even then, it was not clear that would be enough.

On March 17th, six days after I sold my stock, the Imperial College report on Covid-19 came out.  It spelled out three scenarios, all of which were beyond alarming:  a choice between many millions dead in the UK and the US, or merely hundreds of thousands dead if (and only if) national economies were shut down in order to prevent a surge in sickness that would swamp hospital capacity everywhere.

Where are we now?

In the last two days, surges in sickness have already begun to strain hospital capacity in some areas, and critical care health workers are beginning to fall sick, even as hospitals are running out of face masks and gloves, and ventilator capacity is already being stressed.

What's clear now is that the U.S. economy is going to be knocked flat for a year, with massive unemployment compounded by a stock market in free-fall, soaring debt, rising health care costs, and rapidly rising death rates among the advanced elderly. 

Unlike the 2008 subprime fiasco, which largely impacted stockholders and banks, the Coronavirus Pandemic of 2020 will hammer every facet of the U.S. economy, from consumer to producer, from wage-earner to lender, from child to retiree, and from the active healthy to the homebound sick.

No matter what government does, many small businesses will be wiped out, along with family fortunes.

Consumer confidence is likely to be shattered for a generation as people, once burned, are twice shy.

The world is, slowly, starting to wake up.  I am sympathetic. This is Big Stuff and it's hard to get your brain around a global economic unplugging that goes for more than four months and is likely to last more than a year. 

The age-old rule has been to invest in index funds, practice dollar cost averaging, and don't look at the portfolio more than once or twice a year. 

I call this the Crock Pot Rules:  "Set it and forget it." 

That's solid advice for normal times when oil prices rise and fall, and interest rates rise and fall, and consumer confidence rises and falls.

But this is not any time in the last 100 years and, as Lincoln said, "as the world is new, so must we think anew."

The market is not coming back to a Dow 29,000 any time soon.  Let me explain why....

In 2008, the market collapsed under the weight of the subprime crisis.  Properly understood, the subprime fiasco was due to banks contracting out lending services to jobbers who were incentivized to inflate incomes and house prices in order to score larger commissions for themselves. No one actually looked at the properties, as principle-taxes-and-interest had been "securitized" into huge complex packages of thousands of properties. Folks were not investing in actual properties, but in a small slice of a huge portfolio of properties.  No one was "ground-truthing" anything.

When this game of musical chairs stopped, the stock market fell 56 percent.

That was huge, but that was just the stock market.  If you went down to your local breakfast place, they were still serving egg sandwiches, and the local bar still had a Happy Hour.  Folks may have lost money in their 401-Ks, and hundreds of thousands of folks found themselves underwater on their home mortgages, but most folks kept their jobs if not their sense of financial security.  Schools and churches still stayed open, and the NBA still had March Madness. The Vatican still celebrated Easter, and the Hajj went off without a hitch. TV stations still had live audiences, drunks still held hands at AA meetings, gyms still had folks on their treadmills, and the good people at Costco still took cash.

Barack Obama came in and he played a perfect economic game.  As a consequence home prices slowly rose again, and so did the stock market, going up from a Dow of 6,626 in March of 2009 to 19,827 just before Donald Trump took office in January of 2017-- a phenomenal rate of growth that was already due for a correction.

Instead of a correction, however, the stock market reacted to a Trump-created "sugar rush" created by a massive corporate tax cut. Trump said this tax cut would "trickle down" and stimulate the economy as companies invested in production.

But that's not what happened.

Instead of investing in production capacity, or putting the money in reserves, companies engaged in massive stock buybacks which served to drive up stock prices and, by so doing, increase CEO compensation. No new products were made and no new markets or consumers were found, but stocks rose for reasons that relatively few understood.  

As the stock market slowed at the apex of common sense, Trump pushed for interest rates to be cut further. Rolled by scandal after scandal, only a rising stock market and low unemployment could keep Trump’s political fortune afloat.

Then the Covid-19 pandemic hit.

With interest rates near zero, and national debt already off the hinge, there was no room to goose the economy, even if it could be done.

Instead of dealing with the approaching pandemic, Trump denied its existence, and focused on propping up the markets.  His Administratration had few competent administrators, and staff were hired with little or no vetting and rarely lasted a year.  His new Chief of Staff has only an associates degree, while hundreds of key appointments at HHS, Homeland Security, Defense, OMB, and FEMA have not been filled at all.  

The Trump Administration, which has sneered at the very idea of government, and has not bothered to learn even the most basic operating mechanics or functions, is now trying to sail the boat in a hurricane without maps and a massive leak in the bottom. Rather than shoulder responsibility and direct resources, Trump has announced that he is not responsible, and the Governors are all on their own.

What’s ahead?

I think the stock market is going to collapse from its current Dow level of 19,173 (it was 28,634 on January 8th) to 15,000, and from there it may go even lower. Is 12,000 outside the range of possible?  It is not.  Remember, the stock market sank to less than 7,000 in 2009, and the subprime fiasco was a much smaller problem than this.

When will things turn around?

If you are looking for guidance ahead, ignore the stock brokers and look to the epidemiologists. They will be scurrying to get a baseline on the current infection rate, and the speed of the rise and fall. They will be calculating the rates of hospitalization, the effectiveness of social distancing, the costs of treatment, and the capacity of hospitals and key equipment like ventilators.  

When the first 300,000 people are tested, we will know more, but the first signs of economic turnaround are going to be obvious:  Schools and colleges will open up, Starbucks will have indoor seating, Costco will take cash, the stadiums and movie theatres will sell tickets, and unemployment will rapidly shrink from 20 percent to less than 10.

None of that will happen over night. Until we get a vaccine, and that vaccine is produced at scale and folks are inoculated, outbreaks will continue even after herd immunity sets in 18-20 months from now.

Folks without money will be slow to invest in the stock market; they will be trying to get small businesses back on their feet, pay off debts, and fulfill deferred dreams ranging from weddings to vacations, and from children to bass boats.

Three or four years from now, look for the markets to crawl back to the 20,000 level if we are lucky.  Will we ever see 29,000 again?  Perhaps, but I would not hold my breath.

Deep tax cuts to corporations and the hyper-rich are not in the future, and the American people are going to demand that Congress outlaw stock buybacks completely.

The "sugar rush" we've experience in the last three years is not coming back in my lifetime.

We can also expect this pandemic to leave psychological wounds.  Even when the financial damage is healed, the scars -- both external and internal -- will remain. Events as big as this one normally transform how people think for a generation.  Expect that.  

This is a once-in-several-generations event, and it's not going to be "business as usual" for quite a long time.

___________________

Note:  As I was writing this on March 20, the Dow Jones went down 913 points, or 4.55%. That same day, Time magazine reported that a single covid-19 patient was billed nearly $35,000 for her treatment. In an interview in Wired, Larry Brilliant, who helped defeat smallpox, and has helped fight flu, polio, and blindness, says the coronavirus is "the most dangerous pandemic in our lifetime". Over at Yahoo finance, they are predicting Dow 15,000 and Hercules Investments CEO James McDonald says they have moved to all cash; it was actively buying stocks a few weeks ago. This last week saw the Dow tumble more than 17%, for its worst weekly performance since the 2008 financial crisis. Testing has just begun in the US: expect to see reported case numbers jump dramatically just as hospitals in New York, Washington, and other major cities become overwhelmed.