We are finding out just how bad the cure really is

Markets seem to be trying to bottom out at these levels but sentiment is still at rock bottom. Each day we learn a little bit more about how painful the cure/prevention really is. The shutdown has turned to lockdown and this is squeezing the guts out of industry, both small and large. If someone wanted to systematically destroy a society, this would be a good roadmap to follow. At some point the governments have to step back before there is nothing left to save.

Led by the USA, governments are throwing trillions of dollars at the problem as all of the natural laws of business are being overridden or discarded. This will be the greatest expansion of money supply that the world have ever seen. Governments are taking on debt that would have seemed inconceivable 12 months ago, yet is it happening now at the same time that taxation receipts will be falling through the floor for the double whammy. Where will it end? How will the debt be paid back or even reduced to manageable levels. If ever there was a scenario that was going to lead to runaway inflation, this is it.

We are witnessing the sharpest swing towards national socialism and a command economy that we have ever seen in this country, and in other democratic countries around the world. The media is full of bravado from celebrities telling as that “we can do this” in what amounts to indoctrination, trying to give confidence that we are on the right path. The world is changing and most likely, not for the better.
 

 WeeklyComm28March2020.pdf