Dec 12, 2020 — Thankfully, only a few weeks left in this haunting and crazy year of the Covid Pandemic. The latest worldwide numbers on the pandemic continue to rise rapidly in waves.
Coronavirus Cases: 71,720,497
Cruise ships and international air flights quickly transferred the Covid 19 Pandemic to almost every nation on Earth. Yes, despite a great vaccination program beginning this week in the U.K. and the U.S.— the rest of the 7.8 Billion people on Earth will be waiting for a long time.
Ultimately, we need 70% of the world vaccinated to get the pandemic under control and stabilize the economy to a depressed degree. That is a challenge that will take most of 2021.
On December 9th, a new poll from The Associated Press-NORC Center for Public Affairs Research shows about a quarter of U.S. adults aren’t sure if they want to get vaccinated against the coronavirus. Roughly another quarter say they won’t.
Experts say we need more than 70% of the U.S. population vaccinated to reach herd immunity. Where does that leave us?
I believe we can and we will defeat the Covid 19 Pandemic, in time. Therein lies my concern. Time. It will take time for the U.S. alone to be vaccinated wait 30 days, then get a second shot, and then time to develop maximum protection against the Coronavirus. Maybe half of us will be vaccinated by the end of summer.
Meanwhile, the other 50% of Americans will be wandering around among us, typically without masks, hesitating to get vaccinated. And what do we do with the 25% who say they will not be vaccinated.
Keep in mind the task. Before we reach herd immunity, we need 70% of America vaccinated.
Should We Expect Long-Term Damage from the Stimulus
We’ve been thinking long and hard about the Coronavirus Crash back in March. Stocks fell faster than a brick thrown off the Empire State Building wiping out $16 Trillion Dollars in wealth. (Ok, it really took a month, but a wipeout like that was a shocker.)
Almost overnight, the world’s central bankers and governments hit the panic button transferring some $10 Trillion Dollars into the system. It was almost all newly created fiat fake money dumped on a broken, locked down economy.
The goal was to save falling stocks, crashing bond funds, and ETFs that were busted. They poured in liquidity newly created Dollars, Euros, Yen, Yuan, Pesos and whatever currency striving, in vain, to replace a world economy frozen in place.
Anyone invested in Stocks and Bonds can be thankful for the government stimulus to save retirement funds, 401Ks, IRAs, and institutional investors from a complete meltdown. It worked! World markets recovered in the shortest time frame in history.
But, is a recovery based on fake money really going to replace the real economy where people used to go to work? It’s a risky experiment that’s never been tried before.
If we were to survey investors on how they really feel about all the money printing to save the markets, we suppose about half don’t care. The other half might be thinking of running for the exits at any time. They might agree with me that—
“Those waves of stimulus programs and $10 Trillion Dollars of new paper money are bound to create more problems than they solved. Inflation might be the least of our problems. Long term destruction of the Dollar might be the worst outcome.”
Putting A Bandaid on a Bleeding Patient
Even as we watch major U.S. Stock indexes hit new highs, over 800,000 people were added to the newly unemployment rolls last week. Opinions vary on how many millions of Americans are unemployed today who were working Pre-pandemic. At least 12.5 million Americans remain unemployed looking for work.
We have been most concerned that the small businesses of America and those who owned or worked there will be hurt the worst long-term. Closed businesses cannot recover or rehire workers.
There are recessions, there are Great Recessions, and there Great Depressions. There are events that reshape the world… we may in the middle of one such historic event— and no one knows just how bad things will get before we bottom out.