Bear Market – May 20


Macro Wednesday,

We thought the middle of the week is a great day to look at the U.S. economy on a macro level. Today we have some big picture news items along with some economic forecasts from some big names like former Treasury Secretary Larry Summers, Robert Kiyosaki and Walmart CEO Doug McMillon. Get ready for some shocking numbers that are grim (GDP) as well as better than expected (Mortgage Industry). All this and more in today’s Bear Market newsletter.

Have a good read…

U.S. Economy

Americans With This New Card Get Rescue Funds Faster: Treasury Secretary Steve Mnuchin presented a new government debit card at the White House on Tuesday. The purpose of this new “Trump Debit Card” is to expedite the delivery of rescue funds to business owners who have been slammed by the coronavirus economic shut down. “I’m pleased to show you what a debit card looks like with your name on it, Mr. President,” Mnuchin said at a cabinet meeting with the president yesterday afternoon. Mnuchin handed the card to Trump, and then he… READ MORE

U.S. Economy

Former Treasury Secretary Gives Grim Outlook on U.S. Economy: Speaking on Yahoo Finance, former Clinton Treasury Secretary Larry Summers didn’t try to sugarcoat what he thinks about the economy and where the economy is heading: “I think [the pandemic] is going to mark a fairly profound structural change,” said Summers. “We’re going to have very substantial increases in inequality, and a very substantial reduction in any sense of solidarity in our society, unless the government steps up and meets this challenge.” SEE WHY SUMMERS THINKS “WE STILL HAVE NOT HIT BOTTOM”

Small Business

Close to 50% of ALL Small Businesses Could Fail During Pandemic, Survey Finds: “I’ve never felt as scared as I do right now,” said Carlos Marroquin, owner of Planet Soccer in Los Angeles. “ His business was down more than 90% last week despite being allowed to stay open. If the economic chaos caused by the pandemic lasts beyond Memorial Day, which is pretty much a certainty, about half of all small businesses could be in danger of failing, concludes an April survey by the National Federation of Independent Business. SEE HOW MANY COULD FAIL IF THE TURMOIL LASTS UNTIL LABOR DAY

Stock Market

Opinion: Only Buy Stock if You are Willing to Hold It At Least 10 Years: Mark Hulbert is a regular contributor on Market Watch, and he is VERY bearish on the stock market. In his opinion, if you want a 95% probability of stocks outperforming bonds, you better plan on 20 years. HERE’S WHY

Investing

Robert Kiyosaki Gives His Take on Current Economy:“Prepare for the Worst”: “Rich Dad, Poor Dad” author Robert Kiyosaki posted a tweet recently that shows what he is doing to “prepare for the worst” economy but praying for some hopeful results. His assessment is gloomy, but he’s got a rosy outlook on a cryptocurrency and some precious metals: SEE KIYOSAKI’S TWEET WITH ALL HIS ADVICE

Mortgate Industry

Coronavirus Fallout on Mortgate Industry Not as Bad as Expected: With more than four million Americans entering into forbearance agreements, you might expect the industry in general to be in a bleak state. However, when you look closer, it turns out the mortgage sector is doing better than forecasts were predicting just a month ago. THIS DATA SHOWS WHAT’S REALLY GOING ON

U.S. Economy

GASP! Projected Drop in GDP Will Leave You Speechless: On Tuesday the Congressional Budget Office released its own doom and gloom report—specifically on U.S. economic growth, and you may want to sit down before reading this: the CBO predicts that Gross Domestic Product (GDP) will drop 38% in the second quarter. Plus, they project the federal budget deficit will grow to $2.2 trillion in fiscal 2020. SEE WHEN THEY EXPECT THE ECONOMY TO BEGIN RECOVERING

U.S. Economy

Walmart CEO Chimes In on State of Economy, Reopening Process: Walmart CEO Doug McMillon said the retailer is bracing for volatility in the U.S. despite its strong first quarter. “We may see a bit of a two-step in some places where we make progress; two steps forward, take a step back, and then move forward again,” he said. SEE WHAT ELSE WALMART THINKS IS COMING

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