Corona was the last pebble that made the structure crash down.
No one wants to be right predicting terrible times, it is not a thing to boast. Sometimes when we see the writing on the wall and are ignored, we feel vindicated when the thing occurs, and we are faced with the collapse. Being the bearer of bad news is not what people need to hear what they want is a message of hope. Many of us that look at data and factcheck MSM could see the markets were headed to catastrophic times. The issues of 2008 where simply placed on the backs of the people and sold down the road into the future as QE took hold. Once we started down the path of free money the end was in site. I spoke on this both at VRIC and PDAC about these topics, it is something many of us have been discussing for some time. The focus today is not about those fundamental economic issues but the immediate health issues at hand. Our health and wellness are the most important consideration, and this pause in the world will give many of us time to reflect on this truth. Our families, friends and loved ones in our community are key. This is when we focus on those that really are in our lives. This mindset or shift that will happen for many is a good reset to what is important in life…life.
As always, I am here to ruffle some feathers and for some this will not apply at all, for others it may spur some ideas to challenge me on or engage me for discussion. As always, I welcome it and look forward to it.
Work is something most people just do, unless they have found a passion. Most people are getting by even if you are a lawyer in Vancouver. Your rent, mortgage, clothes you buy and food you eat is in part all being funneled to a landowner or bank. The $25 plate of spaghetti in Vancouver tastes about the same as the $16 one in Calgary for a reason. The reason is because they are basically the same, we are just paying $9 lease/rent extra during these past years of ‘low inflation’. I mention this because it is a story about some of the promotional talk we hear about ‘no inflation, best economy ever, record jobs growth, blah, blah, blah. These marketing slogans are at face value true but are meaningless without clarification. It is as useless as saying climate change. We all know the climate changes; it always has changed. The why is the information.
The pandemic is being played out with the same playbook. Politicians are already promoting their plans which oddly enough have little to do with the crisis but entirely about control, power, money and politics. The most important thing is caution, common sense and patience. We are all going to be affected by this on a worldwide scale and in the short term there is panic and there will be volatility for which I would advise most people to avoid. I have never been an advocate for ‘trading’ as it is not my style. I favor investing in macroeconomic sector plays that can make exceptional returns. Nothing in my thesis favoring junior mining in Canada has changed at all.
Here is the main thought: turn off all the MSM (media), that includes Netflix. Netflix other than being old movies you could have seen on cable last month for free is simply redux movies with cultural programming. Nothing useful comes of it and the absurdity of the shows is beyond entertainment. The media has always been there to influence and push a narrative. I am only checking WHO, CDC and official government announcements. I am under no allusion that those outlets are telling us much but then again there is no need to tell the masses. There is nothing they can do other than what they are doing. The masses signed in on this a long time ago. This is a wait and see situation. Regardless of the political gaming going on even within the above politically motivated organizations the key to remember is that there are people working tirelessly for you. The people who need to have all the information have it. We do not need it. They scientist are going to be the hero’s, so give them time. Right now, the hero’s we must applaud are those on the front line: the nurses, doctors and myriad of personal who are treating the sick.
Let’s look at some issues:
The corona pandemic is real. The numbers of infected are rising and this will spread. There will be many sick, many elderly, medically compromised people who will die. There will be the outliers that will dies, too. Most people in the West will be affected economically but as far as their health, it is tough to know. What will be telling is the resilience of each country particularly in the West. Rumors are that a National emergency is going to be announced by Trump soon, and Canada will follow. Living in Vancouver most people, despite aggressive toilet paper purchasing have remained calm, at home and off the streets. The city is quiet, and the key is that we do not know enough, the public may never and probably does not need to know, and we are all being cautious.
We should respond aggressively, like China did regardless of country, residence or nation. China should be praised for their decisive and direct response to the pandemic. I have little interest that it is a foreign pathogen, or the politically correct language people dance around but this could in theory happen anywhere. The problem is not were a disease originated. The likelihood of any of us ever knowing the reality of it is unlikely, and again it does not matter. The theories will become interesting, and eventually entertainment. The act of poisoning the wells go back to the Black Death and the theories of who is responsible will never be answered but make no mistake the political jockeying from both sides has started. That does not mean they created it! It was Rahm Emanuel who said: you never let a good crisis go to waste. The MSM has their talking points and pundits pitching the changes they want even before we have dealt with the problem.
This is going to happen again and perhaps a much worse one. It is not fear mongering but realistic. Unless we mitigate risk regarding open borders, and the unmitigated flow of people a much worse plague will come. Despite all the arguments that people make about our impact on the planet a key fact remains: the planet is much stronger than us. A more serious pandemic can wipe us out quickly, and we have created a system that allows it to happen with ease. The response is what we need to be focusing on right now rather than theories of where, how, why and how this came about. These factors along with climate change, the myth of efficient markets and capitalism will hopefully make us all take a second to focus on what is important. To be clear I am not against open markets, free trade and many of the ideas of capitalism but at its essence it is a parasitic, predatory belief system which excludes competition. The colloquial use of the word by pundits just means that we have competition and meritocracy and a focus on profit. That is necessary, but not at all costs which is what we have. We have a perverted capital markets and system that is not geared towards entrepreneurship, small business or making your own future. We have allowed a system to emerge of ugly capitalism in which all the wealth was taken from the middle, and upper middle class and given to the 1% of the population, roughly 20% of all income. This will change. Capitalism in its purity is repulsive, just as communism. They are the worst ideologies focusing solely on materialism. That is for a different conversation but make no mistake change is coming. Millennials have every right to be pissed off at the future that has been taken from them and my generation has a lot of explaining for allowing this to happen. This is a huge conversation on its own that is for another time. Right now, the best we can do is remind ourselves of what matters, and for most reasonable people it is not money, a job or other material objects. It is family.
The ability of SARS, Swine flu and other pandemics to spread illustrates the ability of these types of illness to spread. The infection rate, the hibernation rate of the illness, undetectability and transference of it are factors which make covid 19 surprising and deadly. The key to take away though is all the free time in the world is not going to put your mind at ease unless you have a degree in science, bacteriology, or have studied pathogens in the past. Rest assured that brilliant minds are working tirelessly for you.
These types of points and conversations are going to be explored over the next few weeks both in print and on video. I find it strange that gold and silver are being sold off, but the question remains why on Earth would you want a currency right now. Sitting in even US dollars is a terrible idea. This may be margin calls, and positions being blown out but for the average person the stock market is not a reflection on their life. Most people do not have a portfolio. They may have a couple managed money products that will more than likely be in serious trouble and thinking of buying a commodity is not sane or rational. They have real problems living paycheque to paycheque. The Coronavirus will affect production in China drastically less then in the West. I see defense stocks raising and the mining sector will find traction and surge. I see those that can take advantage of investing in Canada and China will have significant opportunity over other countries. This is another topic for further debate. For now, I focus on my family, for what I have, on my health and my mindset for making incredible, intergenerational wealth in the next decade. These types of upheavals create incredibly wealthy people. Are you one of them?