Chart of the Week

By Colin Twiggs
March 7, 2020 7:00 p.m. EDT (11:00 a.m. AEDT)

First, please read the Disclaimer.

Financial markets are bracing for impact, in anticipation of a major event. Liquidity is at a premium and Treasury-bill yields (gray) have plunged to 0.6%.

FFR and 3-month T-Bill Yields

Long-term treasury yields have plummeted, with 10-year Treasuries now yielding a record low 0.70%.

10-Year Treasury Yields

CPI is running at 2.50% (Jan 2020) which means that real interest rates are a whopping negative (-1.80%).

Stay on the defensive.

"The most frightening disease I have ever encountered ...and that includes Ebola, MERS and SARS"

Dr Richard Hatchett, CEO of CEPI

The Trump administration is setting the USA up for a major virus outbreak. Minimal testing, in order to keep the numbers down, threatens a rapid explosion which could overwhelm the health care system. This is a situation where people need to stand together to face the threat. Not deny, deflect and misinform.

Dr Richard Hatchett is a "Public health executive with extensive governmental expertise and leadership experience in medical countermeasure development and public health emergency preparedness more generally. Served in the White Houses of Presidents George W. Bush and Barack Obama and designed and led medical countermeasure development programs at BARDA and NIH, including planning for and responding to H5N1 avian influenza ("bird flu"), the 2009 H1N1 influenza pandemic, and the Ebola, MERS, and Zika epidemics."

His stint in government included:

  • Deputy Director and Chief Medical Officer, Biomedical Advanced Research & Development Authority, US Dept. of Health & Human Services 2011 - 2017
  • Director, Medical Preparedness Policy, National Security Staff, The White House 2009 - 2011
  • NIH: Associate Director for Radiation Countermeasures Research & Emergency Preparedness 2005 - 2011

Feedback needed

A reader wrote the week before last to say that they really enjoyed my posts but did I always have to be so negative? Could I not present a more balanced view?

I do not believe that would be in your interests. If something in financial markets really concerns me, I need to warn you about it. Likewise, if I see an opportunity, I will draw your attention to it. Adopting an even-handed approach, giving both bull and bear views, is seldom in readers' interest. Your feedback would be appreciated: let me know whether you agree or disagree.

"They say there are two sides to everything. But there is only one side to the stock market; and it is not the bull side or the bear side, but the right side."

~ Jesse Livermore

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Colin Twiggs is director of The Patient Investor Pty Ltd, an Authorised Representative (no. 1256439) of MoneySherpa Pty Limited which holds Australian Financial Services Licence No. 451289.

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