Op-ed:
The Stock Market, Oil Prices and
COVID-19
By: Diane Sori / The Patriot Factor /
Right Side Patriots on Right Side Patriots Radio
And so the COVID-19 fallout continues
on but with some interesting new twists. First, last week Treasury
Secretary Steven Mnuchin stated that most, if not all, of the U.S.
economy should be reopened by later in the summer and second, public
health officials and scientists at
Stanford
University and the University of Southern California have
released studies that show the estimates of the number of people
infected by COVID-19 were way higher than the number of actual
confirmed cases...something I've been saying since day one. And this
simply means that not only was the virus less deadly than CDC health
officials, politicians, and the media talking heads said it would be,
it also means that the
fatality
rate for COVID-19 does in fact more closely resemble that of the
seasonal flu than it does of a true pandemic...again something I've
been saying all along.
How
did I, a layman, know this...simply by my comparing the number of those
sick, hospitalized, and dying from this season's flu to the number of
those actually confirmed as having COVID-19...as in those sick and/or
hospitalized due to the the virus along
with those who have died from the virus not those who might have had
the virus but who actually died of an underlying disease like cancer,
a heart attack, diabetes, or other such diseases that result in a compromised immune system.
In
other words, I comparing the number of those who died "with
COVID-19 but not
of
COVID-19." And that is key for we now know that the current numbers
indeed have been padded to not only keep the panic, and let's be
honest here by saying the control over
“We the People,”
ongoing...I cannot say it any plainer or more directly than that.
And
with forced control comes casualties not always of the literal body
count kind, but of the kind that wrecks havoc on a country's economy
and freedoms. And sometimes it's a country's economy that sets both
the pace and tone of its freedoms and in our case...in America's
case...we've seen our booming economy...thanks to President Trump's
leadership...coming to a screeching halt because we were told...we
were lied to...that this virus had the potential to if not kill us
all at least to sicken and kill an overwhelming number of us. And we
fell for it by complying to the whims of partisan so-called health
experts and politicians, but the days of their crying wolf are
winding down as our economy will start to recover, as shows of
protest across our country scream we are no longer buying what
you...which includes the media...are selling.
Our
once booming Trump-ignited economy now basically lays at a stand
still but is beginning to see subtle signs of it eventually coming
roaring back, but will the related and adjunct casualties of this
overblown pandemic be able to do the same? Probably yes, but it might
take a bit more time for many of those casualties work hand-in-hand
with each other. Take for example how the stock market as well as the
per barrel price of both crude oil and gasoline both help to boost
America's economy in good times while helping to slowdown our economy
in bad times...times like we're going through now because of
COVID-19.
So
let's begin with the virus' affect on the U.S. stock market, which is
but one key indicator of how well or poorly our economy in general is
doing. And while the stock market reflects only how listed companies
are doing, if those companies are doing well it translates into
investors being confident enough to purchase more stocks, stock
mutual funds, and/or stock options, thus adding fuel not only to help
keep our economy stable but to allow for it to grow. And it's this,
what is basically an economic vote of confidence, that allows small
investors and small business owners the ability to invest in our
economy as well via their buying of stocks which,
again, helps to provide additional fuel for economic growth.
While on the other hand, a major stock market downturn or crash does
negatively affect our country's economic growth. How so...because
lower stock prices obviously translates into less profit for
businesses, pension funds, and individual investors with said
businesses now being unable to get much needed funding for both
operations and hoped for expansion. And it's this cut in funding
that directly aids in setting the stage for economic collapse if it
continues on for an extended period of time, with the outcome being
that our gross domestic product starts to fall what with personal
consumption...as in consumer buying power...and business investment
being integral parts of the GDP, as well as the fact that COVID-19
itself
negatively
affected the U.S. stock market by prompted tens of millions of job
layoffs here in our own country.
And when combined, this allowed for the infamous March market
downturn...a downturn where for every two steps forward the market
took...as in trying to close higher than the previous day's sinking
numbers...it was forced to take yet another step backwards because
of the then and still ongoing call to panic by the COVID-19
doomsday sorts. In fact, no matter the attempts by not only the
U.S. but the world's governments as well as the central banks to
try and limit the financial damage COVID-19 had caused, investor
panic still sent Wall Street into the fastest bear-market plunge in
history. And this directly led to the Dow Jones industrial average
of 30 leading U.S. company shares falling by more than 20% from its
previous peak as traders panic-sold out of fear. And that plunge
reached rock bottom in just 20 days, exceeding the drop rate of the
infamous Stock Market Crash of 1929.
And so a virus out of China ending the longest bull
market run in U.S. stock market history, with the above stated rock
bottom happening on March 16th when the Dow dropped by almost 3,000
points, wiping 12.9% off the main index. And this happened no
matter that the Federal Reserve put emergency interest rate cuts
into effective, in fact, cutting said rates almost to zero while at
the same time promising to buy government bonds in unlimited
amounts. And all this was done in an attempt to calm panicked
market investors while COVID-19's numbers were indeed being blown
out of proportion.
So with the stock market slowly beginning to rise, as was fully
expected it would do...in fact today as I write this finds the Dow
closing up at 23,775.27...know that there is still yet another
casualty of COVID-19 but not in the way most people think. And that
casualty comes in the guise of a drastic drop in the cost per
barrel of oil which equates to prices falling at the pump, which is
a good thing, except for the fact that while prices at the pump
might fall we as a country are still in lock down mode with no
place to go let alone people to visit.
Translation: while the supply of oil is readily available the
demand for oil simply is not because fewer people are traveling by
car let alone traveling by air, meaning we consumers cannot take
advantage of the current lower at the pump gas prices.
And how and why did this now drastic
drop in oil price happen? How about with the fact that with no
place to go a glut of unwanted and still to be used oil was sure to
flood the market. And last week, after a 30
percent cut in demand for fuel we saw the per barrel price of oil
being in the negative range...upwards of minus $40 per
barrel...leaving oil producers actually having to pay buyers to
take take their surplus oil
off their hands or at least to try to store it. And this oil mess
all started when crude oil prices began declining after the Saudis
moved to start a price war with Russia after Moscow said “no”
to the steep production output cuts being proposed by OPEC...the
main influencer of oil price fluctuations along with the always
ongoing political instability in the Middle East. And this was no
matter that OPEC and its allies had already agreed to “historic
production cuts” to stabilize
prices what with COVID-19 continuing on with its worldwide march,
and with said production output drop being at a 20-year low.
And while currently this appears to
be but a short-lived drop what with the per barrel price slowly
starting to rise, know that another per barrel drop is being predicted to
happen within but a month's time as the oil surplus will remain as
is what with the travel restrictions now in place most likely not
being canceled anytime soon. And with the lack of much needed
storage space also remaining a key issue, we find many smaller oil
producers still being unwilling to drastically reduce their
production output, for to do so would have them risking being
unable to pay their workers or keep enough cash on hand to go full
steam ahead on production once market demand increases...once
COVID-19 either naturally goes away during the heat and humidity of
the upcoming summer months (as I've also been saying all along but
the supposed experts are only saying now) or a treatment and/or
vaccine becomes readily available if or when the virus was to
return in the fall or winter.
So where do we go from here what with
the media, some politicians, overtly partisan health experts
obviously being anything but, and with U.S. emergency oil storage
tanks now happily being filled up? Simply, we need to look at the
actual true unpadded COVID-19 numbers as proof positive as to why our
economy needs to be reopened post-haste, thus allowing “We the
People” to get back to work, and with that the stock market
will recover and oil prices will stabilize, and America can be then
America again.
Copyright @ 2020 Diane Sori / The Patriot Factor / All Rights Reserved.
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For more political commentary please visit my RIGHT SIDE PATRIOTS partner Craig Andresen's blog The National Patriot to read his latest article, Tipping Point - The New Abnormal.
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RIGHT SIDE PATRIOTS
Tomorrow, Tuesday,
April 28th from 7-9pm EST, RIGHT SIDE PATRIOTS Craig
Andresen and Diane Sori discuss 'The Stock Market, Oil Prices and COVID-19';
'Tipping Point - The New Abnormal'; and important news of the day.
Hope you can tune in to RSP Radio at: https://streamingv2.shoutcast.com/right-side-patriots
Chirlane McCray, who has just been revealed as a world-class pilferer of taxpayer funds, and her team spent an eye-popping $900 million
— and nobody seems to have a clue on what. Nobody kept receipts; the
subways and street corners are still overrun with crazy people, and
nobody in charge knows what’s to happen next. And yet the mayor defended
the decision to put his wife in charge of that council, saying that her
work with the boondoggle ThriveNYC made her qualified because of the ideas she generated, including a $250-million-a-year mental health plan.
And so a virus out of China ending the longest bull
market run in U.S. stock market history, with the above stated rock
bottom happening on March 16th when the Dow dropped by almost 3,000
points, wiping 12.9% off the main index. And this happened no
matter that the Federal Reserve put emergency interest rate cuts
into effective, in fact, cutting said rates almost to zero while at
the same time promising to buy government bonds in unlimited
amounts. And all this was done in an attempt to calm panicked
market investors while COVID-19's numbers were indeed being blown
out of proportion.
RIGHT SIDE PATRIOTS
