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Earlier this week I saluted a Motley Fool writer, TMFUltraLong, and his piece titled, "Opinion: Stock Market Crash Round2 Is Coming," on the Team Secular board:

https://boards.fool.com/coming-stock-market-crash-round-2-34...

I was amazed to find such a sharp mind such as this guy writing under the name TMFUltraLong. Why is he telling readers to stay the course by purchasing "best of" stocks when he can clearly read the tea leaves?

He just needs to take an extra step or two to bring his critical thinking into sharper clarity which would cause him to act differently. Maybe even change his name to TMFUltraShort.

I feel UltraLong's thesis on this market is correct, but I wish he were to come to Twitter and read people who aren't like the LTBH types so prevalent on Motley Fool boards and who write for their pay for services and newsletters.

If you have read this far, I'd stop now and go review this piece from Ultra Long as I'm about to expand on it.


My fave social-media - hell my only social media use - is Twitter, which allows me to follow comments, thoughts, threads, and links from some of the best minds on this planet. Twitter is more valuable than a bloomberg box to a trader such as myself who relies on data and first-hand insights to help me trade daily off news, rumors, earnings beats, etc. I

Following a diverse crowd of top-notch doctors, lawyers, politicians, scientists, engineers, laborers, etc., gives me a fresh perspective as to what is truly happening at this point in their respective disciplines.

After reading first-hand accounts of what COVID has changed in the worlds of citizen reporters who have brains, I am collecting a series of data points and personal stories that paint what most of us on Twitter are now predicting will be a Swoosh shaped economy trendline. And most all of us think the downside of the swoosh is at just a temporary stop put in by the folks from the Fed. Yes, we have more pain coming. And the Fed will not be able to stop what is next.

Just consider these (mind-blowing) stats from earlier this week and commented on by savvy hedge fund traders and directors, while their threads find support from people affected by these upsets to our Economy.

Keep in mind these bits of news are what has passed in just the past ten days or so:

* Silver for Delivery in Shortage: Mints, dealers, and collectors watch as prices of silver coins double the spot market price.

* Industrial Production: Worst print since 1919

* Retail Sales: Revenues vastly missed Wall Street expectations with 3x the downside.

* Continuing Jobless Claims: We just hit 22,800,000 and another $3 Trillion in bailouts planned with just tendrils of this smoke-accounting filtering down to the workers standing in lines at food pantries and pawn shops. (The checks are hopefully in the mail.)

* Consumer Price Index: Worst sequential decline since December 2008, and demand for big-ticket items is in the toilet.



Looking over the collected data and insider information from Twitter's best minds and comparing it to the stock market of today, where 90% of the companies I trade have yanked their guidance going forward, what is happening in the stock markets now does not jibe with what is happening in the gutters of Main Street Economy of America.

And I'm not talking just the mom and pops who resell and buy the S&P products and services needed to stay in business.

Let's focus on the Big Companies of the Dow and the S&P 500;

Corporate debt to GDP hit its highest point pre-virus. Moreover, the composition of that debt has never been worse.

My go-to follow on Twitter for anything bond-related is Mohamed El-Erian. Back in January, when I first posted news and numbers about Coronavirus from China to Fool, El-Erian was already on Twitter warning us with what a disruption to America's supply chains could mean.

As days turned into the last two weeks of January, El-Erian was already on top of how this would play out in America with disruptions to airlines, hotels, rental cars, cruise ships, ticket sellers, advertisers, etc.

All through February, as our first supply chains were stopping cold, El-Erian warned that COVID-19 would storm America and that we had to be ready for the fallout to our Economy. On some of the best podcasts, CNBC, and Bloomberg, El-Erian laid out his thinking on how bond downgrades for some big-name companies (still looked upon as stalwarts of the Dow and S&P) would be the norm if America did not prepare for the onslaught coming to our shores.

And my man, El-Erian, also warned that there was a vast pool of corporate debt which would not roll over in a sudden market downswing due to what he was already calling a Pandemic. While El-Erian was talking Pandemic, people such as Larry Kudlow, Steve Mnuchin, Stephen Miller, the Trump boys, etc., who surround the President as economic advisers, were all assuring us this was a Chinese epidemic, the so-called Wuhan Flu, and America would not see the numbers China was seeing.

While the President was golfing day after day, El-Erian was waving hurricane flags that when this Cat 5 Pandemic hit an unprepared America, corporate debts still classified in the AAA categories, would suddenly be downgraded to BBB and below.

He predicted this large pool of senior corporate debt would suddenly be marked to market, not to fantasy, and it would kill many companies' future hopes and dreams. El-Erian held a seance with his data sets and he unwaveringly foretold the sectors he focused on in bond markets would show bankruptcies, layoffs, and black holes burned into their balance sheets. He prognosticated such a bond wipeout would end decades-long runs or take a decade or more to repair. As he prophesies, there will be less Cap Ex spent on improvements, diminished or completely cut dividends, and well-paid managers will squeeze struggling labor on wage growth. (See stories already about Amazon/Walmart "hero pay" going away.)

His warning of corporated debts and their fallout are already coming to be. As debts were downgraded - quickly - to junk bond status, more and more retailers and gig economy companies ran into trouble.

Look at the names in just retail filing bankruptcies or preparing to do so: JC Penny, Earth Fare Groceries, J Crew, Lucky's, Neiman Marcus, Modell's Sporting Goods, Stage Stores (owner of Goody's, Palais Royal, Bealls, Peebles, and Gordmans), Noah's Events Venues (like a WeWork for Seminar locations), Tiffany's, Modell Sporting Goods, TrueReligion, Pier1, EarthFare- and more - are either dead or on life-support. If they decide to fight to come back with a Chapter 11 filing, hedge funds will own them for pennies on the dollar and sell off inventory ala the ToysRUS model, or the hedgies will think they can run the business better (remember Eastern Airlines, Radio Crack, Blockbuster?)and run them into the ground for a Chapter 7 liquidation.

How many other Zombie Economy retailers are out there realizing we're never going back to Dec. 2019?

Which leads me to the next observation: Commercial Real Estate REITs have not reflected the truth of what is about to happen to them. And the reason is a good hunk of bailouts to the 1% has focused on saving the ASSets of real estate developers and owners. (Who in our Federal government knows the howls coming out of this sector?)

Furthermore, name a sector dependent on "gig economy" workers, other than food delivereries (Uber's new pivot), and we see wipeouts in revenues for Airbnb, WeWork, Uber, Lyft, etc., and personal bankruptcies declared by a surge workforce which has no healthcare and who now sees little demand for their labor.

Move on to hospitality and transportation: airlines, cruise ships, hotel chains, restaurant chains, car rentals (Hertz is fighting off bankruptcy and is a penny stock now), movers, shippers (other than oil tankers), you name it, all of these sectors are taking bailouts directly from the Fed or through banksters who loaded up on the helicopter money to turn around and lend out at premiums we have not seen since 2008.

All of the above leads to questions you should be asking yourself this weekend, especially if you are an LTBH type who is still fully vested and feeling like you've missed out on the V recovery in the stock market at this time:

How might the most substantial U.S. economic collapse since the Great Depression impact the most debt-burdened corporate sector in U.S. history?

With 22.8 million Americans filing continuing jobless claims, what happens to U.S. consumption even if the U.S. economy "reopens"?

How will a restaurant make money if state-mandates require it to operate at 50% capacity? What about the Hotel/Travel/Airline industry? Or Retail? Anyone here think the two biggest theater chains will be doing bang up business with enforced seat spacing? How about airlines? You think people older than 50 will venture out into the crowds outside, many of them refusing to wear masks?

Lastly, if you read this board or METAR, you know what happened to oil futures not long ago and how it is killing the miracle of fracking in Saudi America? Well, the opposite is happening in silver markets.

This week, the shortage of silver pain finally pushed the price of real silver - not just the futures - out of a long slide - which has been going on for months - versus gold. Friday, silver blew out an overhead horizontal resistance on the silver vs. gold chart.

I read the stories and warnings on Twitter from savvy traders about how silver coins on eBay, in coin shops, etc., were already being marked up and bid up due to the real shortage of silver to make new coins and collectibles. I kept seeing commentary from hedge fund types on Twitter - and these are the people more cognizant of the helicopter money debasing our fiat money supply as they are first in line with loans from the banksters - who said their funds were buying silver through SLV and the 3X leveraged silver fund USLV.

Watching volatility in stocks die down, and watching volatility pick up in silver accumulation by the Bigs stops me cold; suddenly, I must question the collection of paper assets marked with dollars and giving running commentary every month of which ones I hold on Motley Fool. This Bubblelicious behavior is the mania not tethered to reality, and it is where I ask, "Who is going to be the last bagholder here when no one is hitting the asks of overpriced equities and junk bonds?"

Go back to the Great Depression, folks, and look at the years sideways and down and basing for decades on charts for the hints as to what the Trump Depression can and probably look like as we go further.

This V-shaped miracle in the stock market at this market?

This magical rise represents the capital "V," as in the word VAPOR. The balance sheets balance because enormous gobs of stopgap cash were flown in by helicopter from Vulture Capitalists vying like gangsters to hook up companies to vigs that remind of payday loans.

Start looking more closely at debts, inventories, and marked to fantasy accounts receivables, and it is easy to see cash flows and margins are about to take a hit as the green eyeshades write down assets, debts price higher as company junk bonds continue to downgrade, and many IOUs to suppliers change to COD.

Do you feel lucky? Go ahead, ignore these dark clouds on the horizon.

But if you stop this weekend, stand on the shoreline, and open your eyes to the clear air which lets you see miles to that future's dark horizon, you'll know what you need to do beginning this week; indeed, you should be alert as to how you must act before this quarter ends and its earnings reports start tapering in this Summer.

We have plenty of warning from 90% of the companies refusing to give guidance going forward. This current quarter, open your eyes. Accumulate knowledge from the best minds on Twitter, telling you just how bad it is getting in their respective sectors where they focus.

With unemployment wiping out in two months what took 12 years to build for labor demand, who is going to buy stuff? Who can afford a new car, a vacation, a cruise, a home, etc.? When even fine art discontinues mad ascents and the rich are selling off mansions to raise cash and move to the countryside, you know why the rich are shaking.

Sure, the cooped up bourgeois COVIDIOTs from both sides of the aisle are in the sunshine today, smiling like it's 1999. But we know how that ended too, eh?

If you are not liquidating some paper assets due to these METAR thoughts, why do and of us read the METAR board (which is one of my fave boards on Fool) and why would keep up with risks and trends in Macro-Economics if it doesn't make you a better investor?

If you don't act on all the great information provided here and METAR which you can critically think through on your own time by taking a long walk, but you are too petrified ever to move from your EZ-Chair, why not just buy an index fund and walk away from all of this? That's the Lazy Man's (or Woman's) way of staying a loser: stasis, in thoughts and actions.

I'd say go on a cruise and forget it all, but even those are not safely happening in a way you would probably desire and would raise your stress levels when they first come back to plying and polluting our oceans and air.

Take action soon, folks, if you can see the future. Think about what earnings reports for Q2 are going to look like in Q3.

If you are starting to get a contact buzz from growth stocks, and you are starting to hallucinate from FOMO, don't worry, a Depression market level is going to stop this Bubble once and for all and sober up quite a few people who don't understand that the sea change they see, is the tide going out moving their boats and forcing the rats on board to jump ship with their cheese.

Lastly, people are making fun of Warren Buffett at this moment, yet I salute the old man. Yeah, he made a few bad choices, we all do, but Warren doesn't hold when the story changes. When he sees the future and isn't buying these companies lying bloody in the street and hooked up to the Doctors at the Fed, you know this whole Economy is in ICU, and more corporate death is to come.

The event to keep an eye out for later this year is this: a big second wave of infections from COVID-19.

If this second wave has no vaccine to fight it, you're going to look back in November and wonder, "Why didn't I heed the warnings, March through May?

All of the above is my opinion. I am not a long term buy and hold type of investor. I trade for a living. I use Motley Fool and Twitter for intel collecting.
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