Reasons for Concern

    By
    Igor
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    I am rarely wrong as long as I am not trying to be optimistic. Is this a good thing? For my ego – yes. For my everything else – not so much. There appears to be a consensus forming among experts in many usually unrelated fields that we’re heading toward a major shit storm.

    Just a few headlines to get your paranoia going:

    • In addition to Sweden’s failed herd immunity experiment, yet another large medical study shows that Covid-19 herd immunity is just not gonna happen. 1
    • Immunity to the coronavirus is “fragile and short-lived. If you’ve been infected and your symptoms were relatively mild, the resulting immunity will be weak and short-lived. 2
    • Our only hope is an effective vaccine. About 160 of them are currently in development. Many scientists are working under tremendous pressure and cutting corners. Only a handful of these projects will see some success, if we’re fortunate.
    • If and when a workable vaccine is available for general population, only half of Americans plan on getting vaccinated. The other half plans on getting sick and undermining the entire effort. 3
    • For this and many other reasons (ongoing trade wars, political instability, impeding mass evictions, social unrest, threat of inflation, high unemployment, etc), top economists predict the dollar could lose a third of its value. 4
    • China is ending its support for the US dollar. 5
    • The status of the US dollar as the global reserve currency is in decline. The dollar’s value is supported by its status as the preeminent reserve currency. And the dollar’s status as the reserve currency is supported by its perceived value. It is a snake that swallowed its tail. 6

    While I am not saying this is a perfect storm (no matter how bad things are, they can always get worse), I am saying this upcoming Christmas will be anything but merry.

    Stocks are trading higher, driven by automated algorithms oblivious to the coronavirus, elections, social unrest, and trade wars. This is a short-term misunderstanding soon to be corrected.

    Major political forces are in play to make things look better than they actually are. This thin veneer of prosperity will quickly peel off once the elections are over.

    It is too late to be fighting China. That boat has sailed about ten years ago, if not more.

    It is pointless to be fighting Russia. Russia will do what it always does. No sanctions or pointed remarks will change its course.

    Don’t pin too many hopes on Biden: he can’t fix everything. Biden came to Washington as a 29-year-old senator in 1973 and just never left. If he knew how to fix things, he would’ve done so already: he had 47 years to figure it out.

    The other guy is just on a side quest to tweet to death his real and imaginary foes. Don’t expect any breakthrough policies from that direction either.

    We are going through a very painful process of selecting our big chief for the next four years. Our options are two grumpy old men.

    We are hoping that, between taking medications and dealing with aches and pains that come with such advanced age, one of them will fix everything that’s wrong with our country. In other words, we’re being idiots.

    I am just considering all these factors at play and I can’t think of a single positive scenario.

    1. Goodman, Al. “Spain’s Coronavirus Antibodies Study Adds Evidence against Herd Immunity.” CNN, Cable News Network, 6 July 2020, edition.cnn.com/2020/07/06/health/spain-coronavirus-antibody-study-lancet-intl/index.html?utm_medium=social&utm_content=2020-07-06T10:54:04&utm_source=twCNNi&utm_term=link.
    2. Taylor, Chloe. “Immunity to the Coronavirus Is ‘Fragile’ and ‘Short-Lived,’ Immunologist Warns.” CNBC, CNBC, 6 July 2020, www.cnbc.com/2020/07/06/immunity-to-coronavirus-is-fragile-and-short-lived-expert-warns.html.
    3. Warren CornwallJun. 30, 2020, et al. “Just 50% of Americans Plan to Get a COVID-19 Vaccine. Here’s How to Win over the Rest.” Science, 1 July 2020, www.sciencemag.org/news/2020/06/just-50-americans-plan-get-covid-19-vaccine-here-s-how-win-over-rest.
    4. Kreiter, Marcy. “Is The US Dollar Under The Threat Of Inflation? Top Economist Predicts It Could Lose A Third Of Value.” International Business Times, 17 June 2020, www.ibtimes.com/us-dollar-under-threat-inflation-top-economist-predicts-it-could-lose-third-value-2995957.
    5. “China’s Support for US Dollar Can No Longer Be Relied Upon.” Subscribe to Read | Financial Times, Financial Times, 7 July 2020, www.ft.com/content/8e7379c5-9324-4d31-9fcb-fd1e7bc621b0.
    6. Roach, Stephen. “A Crash in the Dollar Is Coming.” Bloomberg.com, Bloomberg, 8 June 2020, www.bloomberg.com/opinion/articles/2020-06-08/a-crash-in-the-dollar-is-coming.