“If the Virus hadn’t caused the Crash, Something Else Would Have”?

What’s the bigger story right now? A Chinese Virus with a deceptively low mortality rate masking its hospitalization rate or rather, the economic crash seemingly placed upon us like a perfect storm? A lot of people are blaming the virus on the continuing economic carnage and they’re not wrong, but the issue is far deeper than that. Ray Charles and Ronnie MIlsap could both see it. The bubble didn’t pop in 2008, it just got bigger. Coming in via Bloomberg, author and economist Satyajit Das very succinctly points out the aspects of the bubble.

Government banks and central banks steadily eroded their war chests and weapons, leaving them with limited ability to deal with a major dislocation.

Even the spread of Covid-19 reflects a lack of preparedness. Given the lengthy history of virulent pathogens, from SARS to Ebola, countries should have expected some sort of global pandemic to hit sooner or later. Their struggles to cope now reflect the lack of a cogent health policy, as well as diminished spending on health, due variously to austerity policies and privatization.

Should have, but didn’t.

Instead of taking those lessons of economic survivability we literally went the entire opposite direction, with eight years of exponential growth in the unfunded liabilities debt that can never be repaid. And what is the Federal Reserve’s answer?

Print more money. But what will happen when the world dumps the Dollar as the world reserve currency?

I’ll remind you that the moves of Russia against Saudi Arabia was not by accident. The timing coincided with the onset of the Chinese Virus and led to a near-perfect crash of our economy leading many investors to panic due to the expected numbers of infected, leaving the ongoing economic conflict largely unnoticed in American media. Our economy is dependent on the flow of oil from those ARAMCO pump jacks.

Well played.

Further, BRICS remains a thing, with its stated goal to displace the petro dollar and with it, will negate any ability for the US to continue its fiscal insolvency. It wouldn’t simply be the Wiemar Republic, it would be the Fall of Rome.

The long-term damage will be great. Hysteresis refers to effects that persist after the initial causes are removed. The current crisis will compound persistent financial and economic weakness; structural damage to industry, employment and public finances; and savings and consumption behaviors which are difficult to foresee. While the Covid-19 crisis will probably pass, our fragile economic and financial system will take longer to recover.

I say that’s an optimistic statement. There’s more at work to all of this than simply a virus. And although its bad, its a smoke screen and catalyst for worse things to come.

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About the Author: NC Scout

NC Scout is the nom de guerre of a former Infantry Scout and Sergeant in one of the Army’s best Reconnaissance Units. He has combat tours in both Iraq and Afghanistan. He teaches a series of courses focusing on small unit skills rarely if ever taught anywhere else in the prepping and survival field, including his RTO Course which focuses on small unit communications. In his free time he is an avid hunter, bushcrafter, writer, long range shooter, prepper, amateur radio operator and Libertarian activist. He can be contacted at [email protected] or via his blog at brushbeater.wordpress.com .

9 Comments

  1. […] 20200402 – “If the Virus hadn’t caused the Crash, Something Else Would Have”? […]

  2. Arthur Sido April 2, 2020 at 08:51

    The Chinese coronavirus is not causing economic instability, it is simply exposing it.

    • NC Scout April 2, 2020 at 09:04

      Exactly.

  3. Matt April 2, 2020 at 10:56

    I’m not sure how people are coming up the Chinavirus having a “deceptively low mortality rate”. The number of people that are truly infected or have truly died from it are unknown. Many other countries are not reporting at all, are incorrectly reporting, or flat out lying. Even in this country the true numbers are not known.

    I have a feeling that people are dividing the total number of deaths by the total number of confirmed cases to get the mortality rates. Given today’s numbers in the U.S. of A. that would give a mortality rate of 2.4%. That is also wrong. This is because those who are confirmed but where the infection has not yet run its’ course could live or die.

    The proper way to determine the “current” mortality rate is to divide the number of people who have died from the Chinavirus by the number of people who have had it and the infection has fully run its’ course (they lived or died). Obviously this number will change as time and treatments progress.

    Mathematically speaking:

    M = Mortality rate
    D = The number known to have died from the Chinavirus
    R = The number known to have recovered from the Chinavirus

    M = D / (D + M)

    Given the U.S. of A. numbers for the morning of 2 April:

    D = 5,148
    R = 8,710

    M = D / (D + M)
    = 5,148 / (5,148 + 8,710)
    = 5,148 / (13,858)
    = .3715
    = 37.2%

    People who are known to be infected but who “finished” their infection cannot be used in calculations as they could go either way. I could give an analogical example, but I’ve typed too long.

    The true numbers will be known eventually, but for the time being people need to take the threat of this virus seriously and take all due precautions.

    Matt

    • NC Scout April 2, 2020 at 11:02

      Exactly. I’ve seen a TON of commentary, even from people who should know better, stating that this whole thing is a giant non-event. They couldn’t be more wrong. That’s not to dismiss the concerns regarding civil liberty infringements- not at all- but to say this is nothing to be concerned over simply speaks from ignorance.

      21 million Chinese cell phone users suddenly vanished with zero explanation. Iran is completely withholding numbers. Italy is on the verge of violent revolution in the streets. And China & Russia sought to attack our economy simultaneously. If anyone doesn’t see the writing on the wall, they’re either completely blind or completely stupid.

  4. Anonymous April 2, 2020 at 18:50

    5

  5. Anonymous April 2, 2020 at 21:51

    4.5

  6. kaiserworks April 3, 2020 at 08:19

    Every death from here on out caused by a fall down the stairs or drowning in a bathtub will be assigned to the Coronavirus. This, to mask the political subterfuge and financial implosions. I have no doubt that the current KungFlu strain is 90% hype 10% danger. however, the controllers willingness to cripple global economies to mask their decades of fraud signals a willingness to unleash new and deadlier pathogens or initiate wars should the plebes start to reject their house arrest to serve justice on the bureaucratic apparatchiks.

    • NC Scout April 3, 2020 at 08:20

      “Every death from here on out caused by a fall down the stairs or drowning in a bathtub will be assigned to the Coronavirus”

      Couldn’t have said that better.

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