DollarCollapse.com

It's Coming...

HAA

  • Home
  • About
  • Breaking News
  • Articles
    • Creeping Fascism
    • Currency War
    • debt
    • Dollar
    • Economy
    • Inflation
    • Monetary policy
    • Precious Metals
    • Stock prices
    • Videos
  • Buy Gold And Silver
  • Join The Email List
  • Contact

So No Stimulus Bill This Month … Really?

by John Rubino ◆ October 7, 2020 13 Comments

Less than 24 hours after beating the apparently wimpiest case of covid-19 ever, Donald Trump decided that his subjects’ lives aren’t exciting enough. So he called off Congressional talks on the latest stimulus bill.

Never a dull moment in pre-apocalypse America.

There’s just one problem: Virtually everyone from small businesses, to renters, to mortgage holders, to airlines, to movie chains, to cruise lines, to growth stock money managers has been holding on by their fingernails, hoping for the infusion of newly created Fed cash that might buy them another few months of normal life. Today that hope evaporated.

Among the likely results:

Plunging consumer spending. Those $1,200 checks were nice, and those $600 weekly unemployment checks were even nicer. But both have stopped coming and the money is gone. In the past couple of months, increasingly desperate Americans have been dipping into savings to put food on the table and gas in the car. Now that further help is definitely not on the way they’ll have to keep eating their already meager seed corn while cutting back on pretty much everything. Less stuff will be bought, the economy will roll over, employment will plunge again and we’ll be back in that capital-D Depression we just crawled out of.

Industry-wide bankruptcies. Some recent headlines reveal the hardest-hit sectors:

Regal Cinemas, the nation’s second-largest theater chain, to close 

Airline Shares Dive As Trump Spikes Stimulus Talks

U.S. oil producers on pace for most bankruptcies since last oil downturn

U.S. Small Business Bankruptcies up 33% Year to Date

These guys, among many others, need massive, targeted bailouts and they need them now. After the election (more realistically after several months of post-election turmoil) will be too late. Multi-thousand-worker layoff announcements will become a daily occurrence, as will high-profile failures.

Residential real estate bust. The end of mortgage and rent forbearance will cause an avalanche of defaults as homeowners can neither make their payments nor refinance, while renters can’t cover the rent that their landlords are now free to demand. Speaking of landlords, rising defaults will send increasing numbers of them into defaults of their own.

Plunging stock prices. The stock market has recently been playing a game with the Fed in which the Fed tries to tighten (or at least stop easing) and stocks respond by tanking. The Fed then capitulates and starts easing again, after which stocks resume their ascent of Bubble Mountain.

This time around stocks were rising on the very specific promise of a new batch of $1,200 checks being sent to Millennial gamers Robinhood stock traders, who would immediately convert their windfall into Big Tech call options. Take that away and the environment is suddenly hostile for stocks that recently exceeded dot-com era overvaluation levels. Today’s 500-point reversal on the Dow when stimulus talks failed illustrates how fast and furious the action might be in a non-bailout environment.

DJIA Oct 6 2020 stimulus bill

Oh, and don’t forget that it’s October, the month when, for some reason, huge crashes like to happen.

Of course everyone at the Fed, along with every politician up for re-election in November, knows all this and is absolutely terrified. So we’re back to The Number, i.e., the amount by which stocks have to decline to turn fear into panic and generate the next big liquidity infusion.

It might come tomorrow. It might come three weeks from now. Everything depends on the amount of punishment the political/financial Establishment is willing to endure.

The one certainty is that no one with money at risk should even think of taking a vacation this month.

Emigrate While You Still Can – To Finca Bayano

Trackbacks

  1. So No Stimulus Bill This Month … Really? – R² Research says:
    October 7, 2020 at 12:28 am

    […] post So No Stimulus Bill This Month … Really? appeared first on […]

    Reply
  2. John Rubino: So No Stimulus Bill This Month … Really? says:
    October 7, 2020 at 12:46 am

    […] Continue… […]

    Reply
  3. So No Stimulus Bill This Month … Really? | Financial Survival Network says:
    October 7, 2020 at 2:12 am

    […] by John Rubino Dollar Collapse […]

    Reply
  4. So No Stimulus Bill This Month … Really? – Investment Watch | Covid-19 Business Relief Resources says:
    October 7, 2020 at 8:14 am

    […] BY JOHN RUBINO […]

    Reply
  5. So No Stimulus Bill This Month … Really? – Investment Watch - Female Investors Daily says:
    October 7, 2020 at 8:26 am

    […] BY JOHN RUBINO […]

    Reply
  6. So No Stimulus Bill This Month … Really? - Free World Economic Report says:
    October 7, 2020 at 4:47 pm

    […] Dollar Collapse  […]

    Reply
  7. だから今月は刺激法案はありません…本当に? | REALTRADE.NEWS says:
    October 7, 2020 at 10:50 pm

    […] 沿って ジョン・ルビノ の ドル崩壊 […]

    Reply
  8. Well Played, Mr. President. Sorry To Have Doubted You - DollarCollapse.com says:
    October 9, 2020 at 5:26 pm

    […] political and financial worlds were baffled by President Trump’s decision, just hours after being released from the hospital, to suspend coronavirus stimulus bill […]

    Reply
  9. Rubino: Well Played, Mr. President. Sorry To Have Doubted You says:
    October 9, 2020 at 7:05 pm

    […] political and financial worlds were baffled by President Trump’s decision, just hours after being released from the hospital, to suspend coronavirus stimulus bill […]

    Reply
  10. Rubino: Well Played, Mr. President. Sorry To Have Doubted You – TradingCheatSheet says:
    October 9, 2020 at 7:27 pm

    […] political and financial worlds were baffled by President Trump’s decision, just hours after being released from the hospital, to suspend coronavirus stimulus bill […]

    Reply
  11. Rubino: Well Played, Mr. President. Sorry To Have Doubted You | Zero Hedge says:
    October 9, 2020 at 8:20 pm

    […] political and financial worlds were baffled by President Trump’s decision, just hours after being released from the hospital, to suspend coronavirus stimulus bill […]

    Reply
  12. Rubino: Well Played, Mr. President. Sorry To Have Doubted You ⋆ Biz Patriot says:
    October 9, 2020 at 11:01 pm

    […] political and financial worlds were baffled by President Trump’s decision, just hours after being released from the hospital, to suspend coronavirus stimulus bill […]

    Reply
  13. Well Played, Mr. President. Sorry To Have Doubted You - The Daily Coin says:
    October 10, 2020 at 2:10 am

    […] political and financial worlds were baffled by President Trump’s decision, just hours after being released from the hospital, to suspend coronavirus stimulus bill […]

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Lanista

Birch

Biden's Plans to Upend Retirement Accounts

Biden’s Plans to Upend Retirement Accounts

 China Just Attacked the USD

China Just Attacked the USD

Millions to be Hit Hard by this U.S. Scheme to Confiscate Your Savings

Millions to be Hit Hard by this U.S. Scheme to Confiscate Your Savings

Millions to be Hit Hard by this U.S. Scheme to Confiscate Your Savings

The “New World Money Order” to Dethrone the Dollar

The Sneaky IRS Tax Law that's Sweeping the U.S.

The Sneaky IRS Tax Law that’s Sweeping the U.S.

Ultimate Gold Investing Guide

TT gif

RAA right sidebar

Money Bubble

Bullion Vault

Adsense Right Rail




AST Article Right Rail 4

AST Article Right Rail 1 + Jay Taylor ad after social media buttons

Google code for remarketing tag

AST Article Below Post

Hyperlink article ellipses, resize images, truncate previews

Sponsored Post

AST ROS Right Rail 1

Gold price chart

Silver price chart

Dollar index chart

Bitcoin

AST Article Broker Buttons

Whatfinger

Buy Gold And Silver Here

Buy Gold and Silver


Birch Gold Group

Hard Assets Alliance

GoldSilver

GoldMoney

Bullion Vault

Google

Copyright © 2021 · DollarCollapse.com