Monday, June 1, 2020

Fact Check: The Stock Market Is A Cryptocurrency

Astute investors will tell you that the stock market is a discounting machine.  It takes estimated future cash flows and discounts them back to current values, and that is what determines stock prices.  It's a definition that has served investors like Warren Buffett well for decades.  It is also a definition that has much less relevance today.  You see, in the short run, and maybe forever more, the stock market is now a cryptocurrency.

From Wikipedia:
cryptocurrency (or crypto currency) is a digital asset designed to work as a medium of exchange wherein individual coin ownership records are stored in a digital ledger or computerized database using strong cryptography to secure transaction record entries, to control the creation of additional digital coin records, and to verify the transfer of coin ownership.
This definition also applies to today's online trading in stocks. The records are kept on digital ledgers on secure computers which verify transactions and ownership.  

Interestingly, stocks and Bitcoin are suddenly more closely correlated:


Now consider these paraphrased quotes:  

  • "The Stock Market has no unique value at all,"
  • "You're just hoping the next guy pays more. And you only feel you'll find the next guy to pay more if he thinks he's going to find someone that's going to pay more. You aren't investing when you do that, you're speculating."
  • "Stay away from it. It's a mirage, basically...The idea that it has some huge intrinsic value is a joke in my view."
If you replace "The Stock Market" with "Bitcoin", these are direct quotes by Warren Buffett. 

As I write this today in the midst of a global pandemic, there have been nightly riots in 75 140 U.S. cities.  Burning, looting, mayhem, and destruction reign everywhere.  It's even spreading into the suburbs.  Churches, malls, government buildings, banks, even The White House itself has been targeted.  Anarchy and chaos are gripping the country.  So what is the stock market doing today?  It's up.  

On Friday when the market closed, we lived in a society largely governed by the "rule of law", a foundational concept necessary for an ordered society and a strong economy.  Today, we can forget that illusion.  It no longer exists.  Yet the "discounting machine" known as the stock market thinks anarchy is going to help "future cash flows"?  Is this how a rational discounting machine would behave?

It's not, but it is how a rational cryptocurrency would behave.  Cryptos know that The Fed, along with other central bankers, will increasingly turn to helicopter money to paper-over failing economies.  That will only serve to undermine the existing government fiat currencies and increase flows into alternatives.  

The old alternative, gold, is cumbersome to transact.  But cryptos are nimble and light light.  Same with stocks.  There was a time when trading stocks cost real money and took real time.  Now it's almost free and instantaneous.  

And unlike crypto or gold, stocks often pay dividends.  They are now the perfect alternative to holding anything else.  Rioting and looting ensure the Fed will continue to drop even more helicopter money to gloss over the damage this will inevitably do to our economy.  That money will flow first into stocks.  

Think of the stock market as a cryptocurrency and it will all make sense.

Saturday, May 2, 2020

Fact Check: Did Dr. Fauci Help Create The Pandemic?

If you aren't watching Chris Martenson's daily Coronavirus updates, you are missing out on the best single journalist covering this pandemic.  His latest entry connecting the dots between the coronavirus, the Wuhan lab, and Dr. Anthony Fauci will have your jaw scraping the floor.

My opinion of Dr. Fauci, head of the National Institute of Allergy and Infectious Disease (NIAID) has "evolved", shall we say.  Like most Americans, I first became aware of him through his constant media presence and his presentations at the White House press briefings.  Here was a guy with the credentials and experience to give us the straight poop on this mysterious virus.  Fauci was the veteran fireman we needed to fight this runaway blaze.  I considered him a national treasure.

But then he lied about masks.  I forgave him, though, thinking he was probably just protecting the health care workers who were having trouble getting them for themselves.  Next he lied about hydroxychloroquine.  OK, maybe he was trying to protect the Lupus patients who were complaining they couldn't get it?  Next he lied about the virus potentially being man-made in a lab.  At this point I'd seen the science, and something was very fishy.  But then he lied about Remdesivir.  This was the last straw for me.  Turns out, fully 20% of the NIH panel that reviewed Remdesivir had financial connections to Gilead Sciences, the company that holds the patent!

But that's just the tip of the Fauci iceberg.  It turns out that Dr. Anthony Fauci, the fireman we are all depending on to put out the fire, is also likely one of the arsonists that lit it!  Watch below and make up your own mind.   

I, for one, am over this arrogant prick.  Fuck Fauci.  National treasure, my ass.  I hope everyone soon recognizes the damage he has intentionally, or accidentally, done to the world and all its suffering people.       

Saturday, April 25, 2020

Fact Check: Did Trump Set a Trap With The Disinfectant Question? [UPDATED]

With this question, Donald Trump set off the yuuugest firestorm ever:
"A question that probably some of you are thinking of if you’re totally into that world, which I find to be very interesting. So, supposedly we hit the body with a tremendous, whether it’s ultraviolet or just very powerful light, and I think you said that hasn’t been checked, but you’re going to test it. And then I said supposing you brought the light inside the body, which you can do either through the skin or in some other way. (To Bryan) And I think you said you’re going to test that, too. Sounds interesting, right?" 
"And then I see the disinfectant, where it knocks it out in one minute. And is there a way we can do something like that, by injection inside or almost a cleaning, because you see it gets in the lungs and it does a tremendous number on the lungs, so it’d be interesting to check that, so that you’re going to have to use medical doctors with, but it sounds interesting to me. So, we’ll see, but the whole concept of the light, the way it kills it in one minute. That’s pretty powerful."

Pundits, journalists, comedians, actors, musicians, ordinary folks, scientists, doctors, and even some twitter trolls, pounced!  How could he say such a thing?  Is he nuts? Is he a complete moron?  Did he just advise Americans to inject Clorox into their veins?  Could he possibly be more dangerous?  IMBLEACH!

Typical headlines looked like this:

'Jaw-Dropping’: Trump Slammed for Touting Dangerous New Virus Treatments After Favored Drug Is Discredited

Forget the matter of whether or not those reactions are even remotely justified by the question asked -  could Trump have actually been onto something?

Turns out the answer is... YES!

  • Since the 1940s doctors have practiced Ultraviolet Blood Irradiation (UBI) to treat pathogens and diseases in the blood.  Apparently it works.  Here's a paper I found at NIH.GOV that calls it "The Forgotten Cure"  Note that today this is done with fiber optics bringing UV into the blood stream.  
  • One of the things I keep hearing from doctors is that the lung pathology of COVID-19 looks a lot like HAPE (High Altitude Pulmonary Edema).  Turns out, alcohol vaporization in the lungs has been known for decades to be effective at treating pulmonary edema.  Here's a paper from the 1950s titled,  "Alcohol Vapor by Inhalation in the Treatment of Acute Pulmonary Edema" .  Alcohol was the disinfectant Trump referenced in his question, because he had just been told it was particularly effective at killing coronaviruses.
  • [UPDATE]  Here's a video which was banned from YouTube and Twitter in response to the collective anti-Trump freak-out.  Apparently, doctors at Cedars-Sanai have developed a UV light specifically for coronavirus that is inserted into the lung.  The video is still up on Venmo for now, though Blogger, a Google Co, will not allow me to embed it here!  All I can do is provide the link: AYTU Healight from Healight on Vimeo.
Look, I don't know if Donald Trump intentionally set a trap for the dim-witted and uninformed, but it sure looks like that's exactly what he's done. Again. Unexpectedly.

P.S. The headline above from The Daily Beast that says Trump's "...Favored Drug Is Discredited" is an obvious reference to hydroxychloroquine (HCQ) which recently got some very misleading negative press.  Is HCQ another trap?  Consider that HCQ is still the number one drug for COVID in the world, usually along with zinc and anti-biotics.  How do you think Chris Cuomo emerged from his basement unscathed?  And how about Boris Johnson?  And Justin Trudeau?  And Tom Hanks?  Not to mention whole nations.   



Monday, April 6, 2020

Fact Check: The Truth About Socialized Medicine [UPDATED 4/14]

The COVID-19 pandemic is, among other things, an historical opportunity to compare healthcare systems around the world.    Though it's still too early to draw any final conclusions, a couple of patterns have already emerged.
The graph below plots the top 40 COVID-19 countries based on their Heritage Economic Freedom ranking and their case fatality rates (CFRs) as of April 14th, 2020.  (China, Russia, and Pakistan have been left out due to unreliable data.)

You'll notice that most countries in the first two quadrants of economic freedom are tightly grouped in the bottom left corner of the graph.  Economic freedom correlates with low CFRs.  But there are also countries with very high CFRs in the free group.  In all cases, these outlier countries have the highest degrees of one-size-fits-all nationalized free healthcare, aka socialized medicine.

It seems the more nationalized and rigidly socialized a healthcare system is, the more deadly it is.  (Sorry Democrats, Progressives, and Socialists.) Meanwhile, economically free countries with strong private healthcare components are performing the best in this pandemic.  The U.S., Germany, Switzerland, Norway, Israel, and others with blended private and public healthcare systems have consistently lower CFRs than their fully socialized counterparts.

(raw data below)

Caveats:  1. It is very early in the pandemic.  2. Each country is on a different part of the pandemic timeline.  3. Data is sketchy at this point.  4. Each country has a unique demographic mix.  5. Some countries are doing well AND have nationalized healthcare.

To be clear, every country, including the U.S., has some degree of government guaranteed healthcare. Some countries have the one-size-fits-all universal free systems, some are totally nationalized w/ a fee, some have nationalized insurance, or single-payer, some are blended public and private systems (i.e. The U.S.), and there's everything in between.

One of the big differences between nationalized countries is how they do it.  For example, total nationalization vs insurance nationalization makes a big difference.  Take Canada and UK:  In the UK, everything is nationalized - all health workers work for the national system and the facilities are owned by the system.  In Canada, the healthcare workers etc. are not nationalized, but the insurance system is single-payer. Canada has a low CFR so far, and UK is quite high.  Neither has a fraction of the ventilators or ICU beds per capita as the U.S.

     (Data sources:  Worldometers and Heritage)

Friday, March 27, 2020

AOC Reacts to COVID-19

(If video doesn't play,  try pressing the "YouTube" button.  Links are buggy these days.)

Thursday, March 26, 2020

Fact Check: Socialism Kills!

It's way too early to close the book on this, but there's already a strong correlation between economic freedom and COVID death rates.  Free markets save lives, and an unfree market (ie: socialism) kills.

To make this graph, I took the top 100 countries in the Heritage Foundation Index of Economic Freedom and calculated the Case Fatality Rate (CFR) as of 3/26/20 based on raw data from Worldometers.

I only included countries that had both significant COVID cases and could also be considered reasonably reliable data sources.  (China is not in the top 100, and I don't trust their numbers anyway.)

I'll update this periodically, and we'll see if it holds.  Below is the raw data.

(Note: The two outliers in the first quadrant are UK and Netherlands, which both have socialized medicine yet relatively free economies.  Again, it's very early in the progression of this pandemic, and there's a lot of data uncertainty.)

Economic Freedom
Cases Fatalities  Case Fatality Rate
683 2 0.29%
Hong Kong
453 4 0.88%
2806 13 0.46%
11811 191 1.62%
1564 9 0.58%
United Kingdom
11658 578 4.96%
1877 41 2.18%
3897 37 0.95%
538 1 0.19%
802 2 0.25%
7431 434 5.84%
1306 4 0.31%
299 4 1.34%
United States
81864 1173 1.43%
1453 9 0.62%
958 5 0.52%
2840 71 2.50%
Czech Republic
1925 9 0.47%
2031 23 1.13%
Korea, South
9241 131 1.42%
2693 8 0.30%
43646 262 0.60%
3346 14 0.42%
6847 49 0.72%
1399 47 3.36%
1029 22 2.14%
1045 4 0.38%
1221 16 1.31%
6235 220 3.53%
893 78 8.73%
3544 60 1.69%
56197 4145 7.38%
29155 1696 5.82%
707 45 6.36%
3629 75 2.07%
892 26 2.91%

Friday, March 20, 2020

The Coronavirus Economic Crisis - How to Fix It?

I believe we are doing this all wrong.  Not the medical part.  I think the world is getting that right as evidenced by the success of gene mapping, vaccines, hydroxychloroquine/zinc, anti-bodies, anti-virals, etc.  The medical crisis might be a supply chain problem at this point.  Still deadly serious, but there's a light at the end of the tunnel.  However, the economic crisis is an unfolding disaster.  

The current approach is like the Dutch boy with his fingers in the dyke.  Except he's trying to plug a million holes with his fingers.  It's simply not possible and doomed to fail.

The government is talking about trying to bail out every individual industry involved, well, at least the big ones with lots of lobbyists.  Airlines, cruise ships (yeah, there's an essential industry) automobiles, chain restaurants, banks, planes, hotels, etc., will all get generous bailouts in the trillions.  And these industries were the ones who for years have been blowing their money on stock buybacks to enrich their execs.  Why should they get a blank check worth trillions?  They shouldn't.

Nor should they be asked to twist in the wind thanks to a pandemic.  

Meanwhile, massage therapists, wait staff, carpenters, bartenders, yoga instructors, musicians, small businesses, restaurants, bars, and people like YOU are completely out of work and on their own. 

There's another way which would save everyone, and avoid the disaster we are creating.  

Believe it or not, this is NOT a MONEY problem.  It's a TIME problem.  

We don't need BAILOUTS,  we need TIMEOUTS!

Going back to the dyke analogy, what if there was a way to freeze the ocean?   

The idea is similar to the sci -fi concept of suspended animation.  To do that we need to both support life AND suspend time.      

Therefore I propose two remedies:

1. Suspend all time related expenses: debt, taxes, rents, leases, insurance, etc. until this is over.  We simply go into timeout for the shutdown weeks or months and add that time to the end with interest. This would freeze bank loans, the entire bond market, municipal market, mortgages, rents auto leases, loans, insurance, and all taxes, etc.  Nobody would be obliged to pay anything, and nobody would be able to demand anything regarding these obligations.  Bankruptcies, evictions, lawsuits, etc would all be in suspended animation until normalcy returns.  

No company would need a giant bailout under this scenario because no company would have these time related expenses during a time of no revenue.  Any company that could continue operations would do so and would continue paying their debts, taxes, rents, and leases. Those that cannot though, would not go bankrupt simply because of a pandemic.  The federal government would still be there to lend to states and local governments who need it.  

2. To deal with the need to sustain life, everyone who needs money in the U.S. would go on the existing food stamp program (SNAP), which would be increased to encompass other essential expenses like energy, gas, and medications.    

SNAP is an existing program. It wouldn't require much modification to scale up for the entire population.  (Alternatively, checks could be sent to everyone, but what could possibly go wrong with that?)  

The timeout bill would be much shorter than the bailout monstrosity and way cheaper.  The only money spent would be for citizens to sustain life and governments as loans.  No money would need to go to businesses and corporations. 

Let's freeze this ocean of economic woe until this nightmare clears up.  When it's over, we can thaw the economy and bring it back to life.    

[Update: Unfortunately, the government will never do this.  Why?  First, freezing the economy would be a huge statistical hit to GDP and the unemployment numbers.  Pumping trillions into a bailout will flow directly to GDP and paying employees who can't work will moderate unemployment numbers. Politicians can't allow the bad optics of crashing GDP and rising employment numbers.  That would spook the markets, God forbid.  Second, Democrats see this as an opportunity to blackmail Trump to sign their agenda.  Both sides want a 2000 page bill that no one will ever read except the lobbyists who write it.  That's why we will spend trillions of dollars we don't have and flood the market with the monetary equivalent of Fentanyl.  Sad!]  

Friday, March 13, 2020

DIY Virus Mask

(If video doesn't play, click on the YouTube button.  Links are not working well these days. )

The government says you don't need a mask unless you're sick.  Translation: YOU NEED A MASK, and everyone you know and love needs one too!   Why?  Because there is significant asymptomatic spread and minimal compliance by the symptomatic.  

Here's how you can make many very good masks for about $1 plus labor. 

See graph below.  What more do you need to know?  

When this is all over, the no-mask policy promoted by the U.S. CDC will be rightly seen as deadly and criminal.   Heads must roll.