Autograph This!

The Dow Jones fell a record 2,997 points on Monday, or 12.9%. That’s the worst ever day in the Dow’s history. Ever. Just one more example of President Trump’s behavior/character/personality. He gooses the market on Friday afternoon, gets a 2,000-point jump before the close, takes a victory lap and sends an autographed print out of the chart to Lou Dobbs.

The next trading day? The Dow’s worst ever, at least in total number. The third-worst in terms of perecentage drop-off.

We’re not taking any joy in this. It’s all about hoping he’ll finally understand: it’s about fighting the virus, not about fighting the Dow’s downward trajectory. Get people to take the virus seriously, provide leadership and healthcare at a federal level, and the Dow will eventually recover. Not immediately. But it won’t drop as precipitously.

The market keeps selling off because investors have no idea how bad this pandemic will be and for how long it will last. And the reason behind that is because the White House has yet to admit to itself, or to us, just how serious this is. All we know is that it’s still in denial. Get past that, and the drop offs will stop.

I hope.

COVID-19 As A Force Majeure

Someone posted the avalanche clip from Force Majeure on Twitter yesterday using new captions that related directly to the coronavirus. I cannot find it but I don’t think you have to use your imagination too much to make the analogy for yourself.

TVIX

You can still make money—crazy money—in the market. If you know where to look. Spoiler Alert: I did not.

TVIX stands for VelocityShares Daily 2x VIX Short-Term ETN and I don’t know what the hell that means. All I know is that the more volatility in the stock market, the more people are buying and selling stocks and not holding them, the more this stock rises. Credit Suisse created this fund.

Well, yesterday TVIX opened at about $335 and it closed at $591, for a one-day percentage gain of 76%. I’m not going anywhere near it. But I thought you might like to know.

Carole Landis

Watching Noir Alley on TCM at Saturday midnight. Eddie Mueller introduces the 1941 film I Wake Up Screaming (perfect title for these times) that stars Victor Mature, Betty Grable and someone I’d never heard of, Carole Landis.

While those first two names got top billing and have become known as much bigger stars, Landis was the one you couldn’t take your eyes off. Betty Grable was one of THE pin-up girls of World War II, along with Rita Hayworth, but Landis was every ounce as lovely. And as it turns out, she traveled as frequently and as far on U.S.O. Tours as anyone during the war.

So how come I hadn’t heard of her? Had you? As it turns out, her life story played out like a classic Hollywood tragedy of its time. Born in Wisconsin in 1919, Landis’ father ran out on the family. Then it later became known that that man may not even have been her biological father (may explain why he ran out).

Landis’ mom moved the family out to San Bernardino, Calif. When she was a teenager she started dancing in clubs. Not much of a dancer, but her beauty was undeniable. By age 22 she was in the film mentioned above. She was also involved in an affair with Daryl Zanuck, who was the studio head of Twentieth Century Fox. Also 17 years her senior. Also married.

It eventually ended. Landis, who’d taken her stage name as an homage to Carole Lombard (who would die in 1942 in a plane crash), moved to England to get in the picture business there. And then she began an affair with Rex Harrison (“I think she’s got it! I think she’s got it!”). He, too, was married.

This affair also ended. Lombard moved back to California. She would take her own life, in 1949 at the age of 29, via a barbituate overdose. Along the way she would find the time to get married four times.

Hollywood, man. Chews ’em up and spits ’em out.

Say Nothing

Are you Irish? Do you know someone who’s Irish? Are you a U2 fan?

If you answered “Yes” to any of the above, I highly recommend this book. Started it last Thursday and already finished it (not having a job helps). And by the way, neither U2 nor Bono are ever mentioned in the book, though you can feel their songs all over it, particularly “Sunday, Bloody Sunday,” “40” and “Mothers Of The Disappeared.”

The author uses the disappearance in 1972 of Jean McConnville, a widowed Belfast mother of 10 children, to launch into a comprehensive tale of The Troubles: the IRA’s re-formation in the late Sixties and all of the characters who inhabited it: the scholarly Gerry Adams, who was once one of the top commanders in the IRA who since went on to become the leader of Sinn Fein (while always denying he was ever part of the IRA); the sisters Dolours and Marian Price, the most militant females in the IRA, the former of whom married actor Stephen Rea (who starred in The Crying Game); Brendan Hughes, one of the top soldiers; and Alfredo Scappaticci, an IRA enforcer whose job it was to torture and murder “touts,” or IRA members who worked as informers for the British… and was actually himself an informer for the British (what better cover than that?).

It’s insane. Tragic. At times, very funny. Compelling. Another book I’m recommending that you probably won’t read, but please don’t hate me for trying.

President Donald Trump: 73

Dr. Anthony Fauci: 79

Democratic presidential candidate Joe Biden: 77

Democratic presidential candidate Bernie Sanders: 78

Supreme Court justice Ruth Bader Ginsberg: 87 (Happy Birthday! Yesterday)

Senate Majority Leader Mitch McConnell: 78

House Majority Leader Nancy Pelosi: 79

Attorney General William Barr: 69 (turns 70 in May)

On one hand it’s wonderful that so many septuagenarians can be so dynamic. On the other we’re in the midst of a pandemic that preys most particularly on people over the age of 70. And there’s no cure.

I’ve just listed some of the most important people in American politics. And they’ve all got a bull’s eye on their respiratory systems. Hoping they all come through this, but as a nation are we not sort of playing craps with our leadership? I mean, they pushed Brent Musburger aside and he was still at the top of his game.

You know how some sports outlets come out with their Heisman favorites in August and then someone like Joe Burrow comes out of nowhere and wins the Trophy? Someone who didn’t even have odds placed on him? If there were—and maybe there is, I don’t know— a way to bet on who would win the election come November, right now I’d place my money on “The Field.” That is, someone other than Biden, Bernie or Trump. I feel as if the world is gonna get weirder before it gets back to normal.

You?

As I wonder how come there’s never been an episode of The Walking Dead that revolved around toilet paper…

Yesterday I went out on a trail run behind South Mountain here and I started thinking about the Civil War. Now, I know that I’m simplifying it, but I’m sure there were plenty of decent church-going southern folk back then who subscribed to the whole “Love thy neighbor as thyself” credo. But then they turned around and kept black people as slaves.

And I imagine some of these southerners rationalized that the blacks actually preferred it this way (Remember Bill O’Reilly only a couple years ago noting that all the slaves who helped build The White House —that name; there’s no end to irony— were well-fed?) and they were happier. Others were able to cognitively disconnect, as their descendants do now, what they profess to believe versus the way they actually behave. Still others didn’t give a rat’s ass because what’s good for business is all that matters.

One thing all of these southerners had in common, though: they didn’t cotton (pun intended) to a bunch of northern Yankees telling them how to live their lives. So the Civil War was fought and it remains the deadliest war in American history (more soldiers died than in World War II, and of those who perished more from disease than from actual battles) and the South was ravaged and a 3-plus hour film was made about two beautiful people who can’t stand one another. Was it worth it?

The lesson of the Civil War is this: some people are willing to lose everything before they admit they’re wrong.

Which brings us to 2020. Remember, was it only last week, when Trish Regan went on air on Fox Business and accused Democrats of whipping up a frenzy and a hoax about the coronavirus? I wonder where she got that idea. Oh yes, it was from the President of the United States.

The playbook for MAGA has been and is as follows:

1. Downplay the coronavirus and insist that Dems/liberals are using it as a weapon to harm the president.
2. As the coronavirus demonstrates that it as a true existential threat, make the point that now is not the time for partisanship (unless Trump wants to tweet something about Joe Biden) or to politicize the issue. Also not the time to dwell on the past.
3. As the coronavirus wreaks the havoc it will wreak, try to demonstrate that there was never anything anyone could have done about it.

In short, as with the Civil War, never admit you’re wrong. As President Trump said, “I don’t take responsibility at all.”

Sadly, human behavior never changes. Science and technology advance, true. But the people who subscribe to those advances are almost always outnumbered by those who are happy in their ignorance. The world is working out for them (free labor in the 19th century, subsidies for being a stay-at-home farmer in the 21st) and they don’t want to hear anything that upsets their paradigm.

Eventually, as it always does, reality strikes. And the Happy Ignorant, they never accept responsibility. They just find a way to channel their bitterness toward someone or something else.

The world keeps spinning. But it never seems to go anywhere.

If you read The Big Short by Michael Lewis (put it on your list if you haven’t), or saw the film, then you know Michael Burry. Christian Bale played him in the movie. He’s a hero of mine.

Socially awkward and with a bizarre condition that keeps him from looking at people directly head on, Burry nevertheless is brilliant. He was doing a medical residency at Stanford when he dropped out to solely advise investors (he’d started an investing blog in med school that proved so popular and he had so many well-heeled followers willing to give him their money that he chose this path).

Burry was one of the big winners of the sub-prime mortgage crisis. Why? Because he coldly analyzed the data two to three years earlier and saw that, even though the housing market had only grown in the past 60 years since the Depression, that prices of homes had only gone upward, that that was about to change. Burry saw that too many Americans were buying homes that were out of their price range, that too many would default on loans that were honey traps, and that too many homes were still being built.

Not an emotional or sentimental type—he’s borderline Aspberger’s, or so it seemed—Burry was not swayed at all by the wave of euphoria at how well the market was doing, or how the housing market had always improved. He looked at the data. And he made the greatest contrarian bet you could possibly make: he bought insurance against bundled mortgages failing. And while Burry never saw a return for nearly two years, when that horse finally came in he made HUNDREDS OF MILLIONS of dollars. He was the guy who picked Leicester City to win the Premier League when no one else did (not literally, just metaphorically).

Burry’s success makes me think about how blind I was (and perhaps you, too) in just the past two-plus months. The coronavirus news hit just before the Chinese Lunar New Year. It had an obvious angle to seduce news editors. And it was originating from the most populous nation in the world. One that is also the origin point of America’s supply chain. It was like we were flying in a commercial airliner and one of the engines blew and now, looking back, none of us paid attention.

What was I obsessed with in the first two weeks of January? Tesla stock, surely. Also, how much more the market would rise and if it would breach 30,000, something that seemed to hinge on whether or not President Trump was impeached. Impeachment! Remember that?

I’ve used this analogy on Twitter, but in hindsight (2020 hindsight in fact!) we were all like that cop in Austin Powers who seems traumatized by the steam roller headed his way even though we had like 30 seconds to get out of the way.

Like many of you, I didn’t get out of the way until way too late. The signs were all there, but I was feeling the feels of the daily vibe of the market. Ignoring the algorithms and the rising death toll in China, the news of the spread to Iran, Italy and even to Washington. As soon as the first person in California came down with it, someone who hadn’t even traveled to China, I should’ve moved entirely to cash. Maybe you did. Surely someone did. Somewhere out there is a Michael Burry of 2020. Would love to meet him.

The good news, for investors, is that the next 6 months offers a tremendous opportunity. I’m done, at least for the time being, and possibly or a long, long time, providing particulars. Why listen to a dope, right? But in general, don’t worry or obsess over how much you’ve lost in the past week or so. And don’t try to make it all back today or tomorrow. It might even be smart to do nothing.

Ask yourself where the market will be in a month. Why? When will the bottom hit? What news will precipitate a bottom and what will precipitate a recovery? And listen to the experts.

When Dr. Fauci goes on national news shows and says, “This will get much worse before it gets better,” I believe him. He’s not running for office. He can afford to be candid.

So, first of all, if your biggest concern is your portfolio and not your health, be thankful. Second, wait for the White House to be more preoccupied with fighting the coronavirus than it is with fighting the Wall Street plunge. The irony is that the more Trump says “I want to keep the numbers low,” the more the Dow’s numbers go lower.

You want to hear about bed availability. About tests truly getting to people. About West Virginia finally recording a positive test. About ventilator production being ramped up. When America, and the White House, is finally ready to accept the reality of the virus, then and only then will the markets begin to recover. Me, I still think we got a ways to go. In the Dr. Elizabeth Kubler-Ross DABDA model, we’re still only just past the first “D” (Denial). Maybe not even past it yet.

If I sound negative and pessimistic, I’m sorry. I’m just trying to sound realistic. It was only six days ago that I said all sports events need to be canceled through March and that I was pilloried on Twitter for it. So I think that it’s going to take a big name, either a celebrity or a nationally known politician, to die before America has its next real wake-up call. This is still a disease that’s happening to people we don’t know. At least on a grand scale. Maybe when that changes people’s attitudes will change.

In the meantime, I’ll try to think more like Michael Burry. Listen to the data, and not to how you feel. Or want to feel. It could be the smartest financial move we ever make.

Live from the Hunker Bunker, somewhere in the Sonoran desert…

Coronavirus Updates*

CASES DEATHS

U.S.A.

Cases: 3,602

Deaths 66

WORLD

Cases: 167,400

Deaths: 6,329

*Source: New York Times

Safe At Home

Good coronavirus advice from Dorothy: “There’s no place like home, there’s no place like home.”

your quarantine name is your first name + your last name, stop going to bars and the goddamn movies

— Kristen Arnett (@Kristen_Arnett) March 16, 2020

Coronavirus-related self-quarantine films we might recommend:

Panic Room, Rear Window, Room, Night Of The Living Dead, The Apartment, The Diary Of Anne Frank

Your ideas welcome.

Secretariat was an early adopter of social distancing. pic.twitter.com/zvk8ACBg1M

— Super 70s Sports (@Super70sSports) March 15, 2020

It Was The Worst Of Times, It Was The Worst Of Times

News from Arizona is that the local Medieval Times castle will be shutting down for awhile. Our suggestion is that it return as End Times, which will feature runs on toilet paper and a jousting match between Yamiche Alcindor and Donald Trump.

Profiles In Presidential Courage

“The buck stops here” –Harry Truman, 1946

“I take no responsibility at all” –Donald Trump, 2020

Tragic Kingdom*

Current crowds at the Magic Kingdom for tonight's showing of Happily Ever After… #DisneyWorld pic.twitter.com/xtBoObaQAx

— WDW News Today (@WDWNT) March 16, 2020

*The judges liked this better as a No Doubt album

Crowd shots from places like Walt Disney World, New Orleans’ Bourbon Street and Nashville bars is the “Let them eat cake” of 2020. Don’t ya think? By the way, I sorta feel as if 2020 began when Kevin Durant tore his Achilles tendon in Game 5. That’s when the sad trombone began playing for me (and it wasn’t that I wanted the Dubs to win—though I did—I just wanted to see both teams at full strength).

Stockpile Bro

Matt Colvin, the Tennessee dude who purchased nearly 18,000 worth of hand sanitizer two weeks ago with the idea of selling it on Amazon, but was then profiled in The New York Times, has announced that he will be giving it all away. So that’s a nice gesture. We’ve also added “hoarder shaming” to the list of 2020 things.