My Thoughts On The Recovery. Obama's Dirty FBI Leadership.

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These are my expanded thoughts on the type of recovery I expect.

That we will have a recovery is a certitude.  The question is whether it will be robust  or not, in other words a V or some other letter like a W.

America's first quarter GDP was down about 5% and the second could decline by a magnitude of 10%.  Europe's first quarter was down about 10% and is expected to be significantly worse in the second as well. By the third quarter we should begin to see an improvement and by the fourth quarter it should be more robust.

America has a largely service and entertainment economy and consumers make up about 70%.  How fast consumption recovers is a key factor but we also are impacted by what happens globally and one should expect the world economy to lag because capital is less available to re-stimulate.

Furthermore, undeveloped nations are dependent on commodity prices which are seriously low as is the price of oil which is a reflection of both oversupply and significantly lessened demand. American oil production is down some 2 or so million bbl's per day.

Yes, The Fed, in co-ordination with Congress, have supplied enormous stimulus but -re-employment is key to consumption and the private sector, which is a critical employer, has been gored.

There is a certain degree of pent up demand but not enough to carry the economy without significant improvement in unemployment figures and abatement of the emotional impact COVID 19.  This will all take time.

Some of the largest consumer sectors of the economy will continue to respond to medical concerns so I seriously doubt travel and sport event attendance will snap back quickly as well as mall shopping and restaurant visits.  In the case of restaurants, most, even if they open,will reduce the number of tables in order to maintain "safer"distances and this impacts revenue and thus margins.  I also suspect restaurants will order less to reduce spoilage.

There is one sector I am particularly interested in because I have been involved in matters pertaining to education a good part of my life.  I have stated small private liberal art colleges were most vulnerable even before COVID 19 and now we are seeing evidence because many are closing and/or on the brink of BK. The impact nationally is not as great as locally on those towns and cities where these colleges are located because they are a tremendous economic source as well as provide cultural vitality. Recently Urbana announced they are closing and more will be doing so.

Part of the problem is a liberal art education is no longer thought necessary.  Culture and reasoning have been replaced by technology and vocation.  Equally important,  PC'ism caused all colleges and universities to expand administrative employment so "our little snowflakes" could be protected from the vicissitudes of life's "slings and arrows." How did I ever make it through college and law school without being told how to conduct myself by authoritative bureaucrats and how to treat those of the opposite sex who were engaged in raising their skirts and going without bras? And what about members of the black community who were now the beneficiary of de-segregation and affirmative action yet unqualified to compete because of years of unwarranted deprivation?

I guess it was because I was raised in a society that still valued values and believed you were responsible for your own conduct and because I graduated college in '54 and law school in '61 and before post Viet Nam tirades wrecked our nation's respect for authority. I never was raised to believe anything went and smoking pot was acceptable.  I was too busy learning self- discipline in military school, serving in the military prior to law school and then married with a young daughter.

I missed out on all the wild life and irresponsible behaviour period when I was supposed to love  one another,  wear beads, walk around aimlessly protesting what I did not like, go to concerts and learn to say the f word in every sentence.

But I digress.

I could mention other restrictions which will curb recovery momentum but these are the main ones so I expect the economy to take a more W shape.

As for the market, which is a barometer not a thermometer, I would expect it will go higher because 2021 should be a year of acceleration unless Democrats win the presidency and retain The House. Why?  Because they will continue to act as a roadblock to anything Trump seeks to do and I believe our relations with China will be anything but smooth as we and the world transition away from China's stifling influence.

Perhaps the greatest negative influence will be a hidden one.  America will never be the same and the consequences of that will prove incalculable.

Oil's Collapse Is a Geopolitical Reset in Disguise 

Meghan O'Sullivan, Bloomberg++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
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