We are in heated agreement.

• The Swedish statistics are useless due to low testing rates.  You cannot draw meaningful conclusions from the Swedish experiment yet.  

• I said healthy people who die, take a long time to die.  It takes them 45 - 60 days to drown in their own lung fluid as they fight every step of the way.   Old, fat people don’t have the same fighting ability and die much quicker.  This means death rates for recent infections (less than a month old) are too low because you have not given healthy people a chance to die yet.  You should not draw any inference from this about the proportion of young, healthy people who die - obviously it is a small proportion of the total cohort.  

At the risk of hubris, Australia is on the edge of eliminating the virus.  We have 10% of the population of the USA and 97 deaths total.  Our death rate is roughly one-thousandth yours.  

The only difference is that our leaders (despite their other faults) listened to the medical advice.  Within 2 months we should, fingers crossed, have a completely open and fully functional economy with no virus behind our sealed borders.  Many other European countries will also be in the same position.  

Meanwhile the US will lurch from crisis to crisis over the next six months, with hundreds of thousands and possibly millions dead.   You can keep your liberties.  

On Bitcoin, I suggest it is only a 50% chance that it will trigger another significant crash.  It is really hard to tie the real economy to Bitcoin, and question the extent we should try

Lol.  Awesome.

It’s the hype evaporating from the halvening rally

Would be lovely to think this is washing out the leveraged longs before a mega pump

Sadly I think that is wishful thinking

Wheee

JJG:  my bad.  I meant not holding open leveraged long positions which could get liquidated.  I am about 93% BTC, 7% cash at the moment.  

I don’t know what level we could revisit and I am not going to forecast it.  It could be mild or it could be severe.  I am using my 7% cash to place staggered buy orders all the way down the scale and will leave it at that.  I won't enter any leveraged longs until below $6k at earliest as I don't want to be caught with a high averaged cost base for those leveraged longs.      

The stock market is way too high right now.  

Here is the SPX500.  There is no justification for us to be sitting at October 2019 levels.  The market has gotten ahead of itself with the promise of reopening, not realising that reopening is going to see bad times.  The stock market "should" tank.  In writing this I acknowledge conventional wisdom is you should never fight the Fed.  So the market is going to swing on interpreting the Fed.

Sweden has a Case Fatality Rate of 12.3%.  Obviously the real CFR is lower than that, but impossible to tell what it really is due to lack of testing.

Good point.  This is a Case Fatality Rate of 0.55%.  Possibly the Australian CFR is skewed upwards by the cohort - lots of old unhealthy people on cruise ships.  


Cohort here is over 90% migrant workers in dormitories.  Young to middle aged men, thus at the lower end of the risk spectrum. Not representative of the general population.  But an excellent result.  Only question is how old the infections are.  It takes a long time to die from coronavirus if you  are health so you can to give people 45 - 60 days to die. 

China also track and trace the fuck out of everyone.  You get measured your temperature everywhere 20 times per day.  You can't enter the mall without showing a government form on your phone that you are a coronavirus free.  They track and analyse your location constantly.  They have CCTV inside apartment hallways watching your door.  If you have a cough, they put you in a white van and you disappear.   It's not comparable.  

Also all Chinese statistics are bullshit and always have been.  It was that way when I was working there in the early 2000's.  They could bury 10 million people in a field and no one would know.  

I'm not selling bro.  I'm postulating.  And putting my leveraged long entry points very deep. 

Amen to that.  Doesn't stop us trying though !

I am going to post something quite unpopular.  It will make some people mad at me.  This is not certain, but I would say it is a 50/50 probability right now.  I sincerely hope I am wrong, but I am worry that I am not.  

The US has dun goofed its coronavirus response.  The US locked down too slow, and now it is reopening up too fast.  With the exception of New York, case rates are still rising in every state.  Nebraska, which reopened on Monday, reported a 57% case rate rise in the past 7 days.  In saying this I acknowledge that testing levels are so low it is hard to work out what is really happening except we know there are superclusters at the meatworks which are not closing because they have been deemed essential.  

We have extremely bad economic data.  On some readings, the data is worse than the Great Depression.  This puts the political leadership at both State and Federal level under enormous pressure to reopen.  So I can understand why they are doing it, particularly given there is not the appetite for the social welfare schemes which have been rolled out in other countries to support workers staying in their jobs.

But know this.  By half-arsing the lockdown and pulling out too early, and then triggering a crushing second wave in late summer / early fall, the economy will get refucked.  The number one mistake is thinking that fighting the virus and supporting the economy are mutually opposed aims.  They aren't.  Crush the virus and you can have a thriving economy back.  Surrender to the virus and you also surrender your economy.  Because when your hospitals overflow and your doctors are all dying and there are bodies in the street, there will not be a functioning economy.  Reopening now, before adequate testing and tracing is available, and while case loads are still rising, is an act of surrender.  

The consequences are not going to flow immediately.  Things are going to feel just fine through the next couple of months of summer.  It will be warm out.  People will say that the warm weather killed the virus.  Everyone will be outdoors, drinking beer and having a nice time.  Food and bev will start to do a roaring trade again.  People will think we are winning.  There will be cluster outbreaks which will be blamed on poor management by the Governors.  Some regional hospitals will be overwhelmed, but they will be a long way away.  

But come late summer or early fall, shit is going to start to become visibly bad.  We know the second wave of the Spanish Flu killed far more than the first wave.  195,000 Americans died of the Spanish Flu in the month of October 1918.  There are 328 million people in the US.  The Lancet estimates the Case Fatality Rate of coronavirus at 1.38%.  Australia's actual Case Fatality Rate is 1.33%, which is one of the lowest CFRs in the world, reflecting a world class health care which is not under stress and massive testing, increasing the size of the denominator.  If half of the US population catches coronavirus, and the CFR is optimistically 1.33%, then that is 4.3 million deaths across America.  If the hospitals collapse, the death toll has the potential to get much higher.  

I think the reality is we will not get there, and there will be a series of smaller state level, or town level lockdowns.  This rolling wave of small lockdowns will fuck the economy good and will spark open conflict between the White House and State / local government.  

What does this mean for Bitcoin?  I believe that Bitcoin is still predominantly driven by US retail demand.  I also believe that there is at least a 50/50 chance that the US economy will be fucked good between now and November.  The confounding factor is that the halvening will reduce supply by 50%.  Normally I would regard this as a sure thing, but it needs to be balanced against a possibly very sick US economy.  Further complicating matters, just about every other developed country in the world has managed to figure out how to beat the virus and will be back on the path to recovery behind locked borders.  People in those countries will be able to buy Bitcoin.  

My conclusion is that we should not expect an ATH this year, and there is a 50% chance that we will not see the AYH again of $10,501 set in February 2020.  Volatility will likely stay very high, which means the opportunity to profit from extreme swings and also opportunity to be liquidated if you are using anything other than very low leverage (less than 1x leverage).    So be defensive and don't hold open long positions past the halvening.  

Good luck and stay safe.  

Use maker taker

If you are not the maker, you are doing it wrong

Or you could just build intergenerational wealth

We did it in 1930.  Why not give it another go?

https://newrepublic.com/article/83824/slichter-budgets-depression-1932

Would you consider now to be an opportune time for the States and Fed to return to a balanced budget?

I don’t think a breadline really counts as a bailout.  I can’t see any junk bonds in the pic. 

I strongly favour incremental panic