Only the 7 % Want Normal Again
Who are the 7 %, they are the 1 % and the other 6 %, all the people who aspire to be in the 1 %.
What I am saying is that I find it interesting in talking to people I know and others I read about. There are a lot of people who realize there can be a world where you have time to absorb the beauty of things around you.
So I see a new paradigm evolving with a lot of cross currents for the seemingly embraced evaluation of Normalcy, the stock market.
Signs and perceptions for a higher market are:
- First, no doubt number one is the historic FED and Treasury intervention along with Congressional stimulus bills.
- Second there is a strong hope and belief that pharmacetical companies will come up with drugs first and a vaccine second, that will make this all go away soon.
- The President’s daily higher Stock Marketing message seems to get through to his 33 percent.
- There is a strong belief on Wall Street that if they hold hands they can look over the abyss and ignore the bad news.
Signs and Perceptions for a defensive and lower market are:
- Number one on this side is the lack of coherency in The Federal COVID 19 program. The base case for comprehensive testing is being dismissed.
- Number two, polls show that 62 % of the people believe that the stay at home orders are good and working and 26 % would actually like stronger rules. Only 12 % want things to go back to normal and open things up.
- Third, media has not done a good job, probably because of a lack of data, to show that there is a third aspect to those who end getting infected. It is not just you heal or die, there is a significant contingent that end up with long term disabilities.
- The result is, I believe, that a majority of Americans will isolate in place on their own until strong and universal Federal regulations are instituted.
Market Evaluation of all this at the moment. The FED/Treasury Bubble on the S&P and High Yield bonds mentioned yesterday is containing the market. The S&P is working around the central part of that bubble, 2760 to 2840.
Gold remains the highlight at the moment.
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