DailyAlts Playbook: Money Printing, Jams on the 90s, and Why Sovereign Funds are Struggling

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THE DAILYALTS PLAYBOOK

March 27, 2020

Today, the DailyAlts Playbook talks about Money Printing, Jams on the 90s, and Why Sovereign Funds are Struggling.

PRIME OVERVIEW

Good morning:

The Shelter in Place Order for Collier County has finally dropped, and Lee County will soon follow for Florida residents.

The lift comes on April 17, which allows me to reflect on life in a profound way. I will turn 39 in six days, which gives me ample opportunity over the next 22 days to reflect on the last 22 years since a dozen or so people handed me a copy of “Oh the Places You’ll Go” during my senior year of high school.

Rather than spend too much time examining the twists and turns of this odyssey, I plan to revisit my favorite music from every year on each day.

We kick off with 1999 – a solid year for sound. Wilco’s Summerteeth, Beck’s Midnight Vultures, The Soft Bulletin by the Flaming Lips, Blur’s 13, Fiona Apple’s When the Pawn (Paper Bag is underrated), and The White Stripes’ self-titled album.

This will help me keep my mind off the fact that my two-year-old is clearly plotting against me.

She continues to leave small, strategically placed toys in walkways.

Even though we had a nice run with the SPXL from Tuesday to Thursday, I don’t have the heart to tell her yet that any fortune she seeks has been withered away by the Federal Reserve.

Let’s dig into the headlines.

MORNING MOMENTUM

CHEERS: The Dow Jones projected a 680-point decline in premarket hours as the markets selloff from a massive three-day rally. The mainstream press is back in cheerleader mode, proclaiming that the Bear market is over, despite the fact that the American economy is effectively shutting down for the foreseeable future.

CORONA CASES: Johns Hopkins University said that the number of global coronavirus cases jumped to 542,700. Of that total, roughly 86,000 are happening in the United States. United Kingdom Prime Minister Boris Johnson tested positive for the virus. Meanwhile, President Trump and Chinese leader Xi Jinping held a phone call to explore ways to work together to address the global pandemic.

RESCUE: The key components of the relief package, the largest in U.S. history, are:

  • $250 billion for direct payments to individuals and families
  • $350 billion in small billion loans
  • $250 billion in unemployment insurance
  • $500 billion in loans to distressed companies

What does that mean for gold and bitcoin?

ACCRUED INTEREST

LOSSES MOUNT: Yesterday, we highlighted that Norway’s Sovereign Wealth Fund shed $122 billion during the coronavirus crash. But the losses are even larger in the Middle East. The combination of coronavirus and the oil crash has funds across the region struggling, according to the Institute of International Finance. The question is how soon will OPEC and Russia return to the negotiating table to discuss oil production caps.

BEARISH: Paul Tudor Jones said this week that he expects that the market will push higher by June. However, he expects there to be a very volatile market come April. In an interview with CNBC, the money manager said that things could get bumpy once we start to look at the real economic impact of coronavirus.

COOPERMAN: Becky Quick interviewed Leon Cooperman from a room that needed more bookshelves. The money manager thinks that the markets bottomed out on Monday.

CARRIED INTEREST

Here are the other headlines getting our attention on Friday morning.

QUOTES OF THE DAY

“Breaking: A new bull market has begun. The Dow has rallied more than 20% since hitting a low three days ago, ending the shortest bear market ever.”

The Wall Street Journal. The same day that 3.3 million people were registered on unemployment rolls. The same day that we learned that 50% of New York will lose their jobs. Who does this newspaper think it is… CNBC?

“Congrats to the mega wealthy! And the 3 million people that just filed jobless claims can go f*** themselves! Party’s back on!”

That’s Chris Irons – aka Quoth the Raven – in reaction to the WSJ headline.

SOCIAL RESPONSIBILITY AND THE DAILYALTS PLAYBOOK

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DailyAlts Playbook: @DailyAlts

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ABOUT THE DAILYALTS PLAYBOOK

Garrett Baldwin is the author of the DailyAlts Playbook.

An economist and author based in Naples, Florida, Garrett has an extended history of financial analysis, business journalism, public relations and consulting experience in hedge funds, private equity, alternative investments, housing policy, commodities, and public equity coverage. He holds degrees from Northwestern University, Johns Hopkins University, Purdue University, and Indiana’s Kelley School of Business. He also has a Certificate in Global Business from Harvard Business School.

An avid Baltimore Orioles and Buffalo Bills fan, he would prefer to discuss other sports, please.

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