If You Think 'Tiger King' Was Good...

The largest broadcast of the 'pandemic era'... A mix of long-term trends... Advertising is sold out... If you think 'Tiger King' was good... Doc talks Porter's Digest... How rock-bottom oil prices will kill emerging economies...

If you're looking for something new to watch...

And something that's not the news...

Tune in to watch the NFL Draft tonight, starting at 8 p.m. Eastern time.

It's probably the biggest live show of the "pandemic era" so far. And hopefully all goes well with this massive virtual event... But given the newness of it all, there's a decent chance that it could turn into an entertaining, technological car wreck, too...

For the uninitiated, the NFL Draft is an annual springtime event during which eligible college football players are chosen for employment by professional teams. The organizations pick in the order of how they finished, from worst to first, last season.

This is normally a flashy, in-person, prime-time event at some high-profile place like Radio City Music Hall...

Thousands of fans typically attend. NFL Commissioner Roger Goodell commands the center of attention on a well-lit stage, then congratulates well-dressed guys in their early 20s who've just become millionaires.

But that won't be the case tonight...

Like almost everyone else, the NFL world today is in social-distancing mode. The league actually has a government antitrust protection, but it's still not considered "essential" in a pandemic economy.

So tonight's draft, involving the large coaching and scouting staffs of 32 pro football teams and hundreds of college players hoping to realize their NFL dreams, is going "all virtual."

This is the largest broadcast of the pandemic era...

From the sounds of it, tonight's broadcast partnership between the NFL and Disney's (DIS) sports arm, ESPN, is the biggest live-production effort since stay-at-home orders were enacted.

The show will air for a few hours on ESPN, ABC, and the NFL Network... Players will be quarantined at their houses, as will coaches and scouts from different locations all around the country.

Goodell will reportedly announce the picks from his basement... And ESPN will coordinate more than 100 live video feeds. As Front Office Sports media reporter Michael McCarthy wrote earlier this week, it's a complex logistical project...

Seth Markman has overseen ESPN's coverage from the Super Bowl, World Series, MLB All-Star Game, and "Monday Night Football." But the vice president of production has never tackled anything as difficult as televising this year's NFL Draft...

Mark Quenzel, his opposite number at NFL Network, has worked Olympics and Super Bowls. But "nothing even comes close," he said, to the logistical challenge of melding hundreds of remote video feeds from coaches, general managers, announcers, players, and parents into a coherent national broadcast later this week.

But the show must go on – especially since there are no live sports to watch.

We're not just bringing this up to explain the complexity of the production, or to make a public service announcement for people craving live sports programming...

We get no royalties. We bring it up because there are broader, macro themes at play...

This event represents a showcase of the confluence of potential long-term, market-changing trends...

It might be a watershed moment for media. It could show how virtual and real life can coexist on a grand scale.

The logistics include at least 32 simultaneous virtual team meetings powered by Microsoft's (MSFT) Teams software and Zoom Video Communications (ZM)... connecting coaching and scouting staffs from their homes.

Efficiency is key because each pick is timed to the minute. In a test-run mock draft on Monday, the technological glitches apparently started with the first overall pick by the Cincinnati Bengals.

Amazon's (AMZN) Web Services is hosting hundreds of camera feeds through its cloud system... Verizon (VZ) is helping with connectivity and supplying more than 100 phones for communications... and Bose is providing more than 130 sets of headphones.

Cybersecurity is involved, too... No team wants the other 31 organizations to know who it's thinking of picking next or what it thinks about the pool of prospective selections. The league will have private and encrypted Teams channels.

And of course, it's pure entertainment for the rest of us. Analysts project between 10 million and 15 million people will be watching "at home." Because of the circumstances, ESPN broadcaster Trey Wingo recently said...

Suddenly the IT guy on your team is the most important member of the entire broadcast.

A related aside... I (Corey McLaughlin) know a few IT guys who might say they're always the most important... just nobody knows it.

More advertising has been bought for tonight's draft than ever before...

Advertising space during the first three rounds of the draft is all sold out... just like the Super Bowl.

More than 100 companies, such as home-improvement giant Lowe's (LOW), will advertise during this year's draft coverage. About 60% of those companies will be doing so for the first time. As James Minnich, Disney's vice president of sales, said...

We've seen, frankly, more demand than we have availability due to the pause in live sports.

In the short term, this is another boon for Disney's digital efforts, headlined by the Disney+ streaming service the media power launched last November.

And it's an example of Disney's "trophy assets" at work (while its theme parks are shut down). In this case, it's the company's NFL broadcast rights.

On the security front, if you think the characters from Netflix's (NFLX) hit show 'Tiger King' are paranoid...

Just spend some time talking to a college or professional sports coach or front-office executive... They're constantly scared of a rival "watching" a practice in person from a tree in the woods, much less over high-speed Internet.

We've been told that police will patrol outside the home of Baltimore Ravens General Manager Eric DeCosta... And he'll also have IT staff on hand in case something goes awry.

Just in case things don't go according to plan, longtime NFL reporter Peter King said...

There are two fail-safes: A GM can call [NFL's Vice President of Player Personnel Ken] Fiore or a member of his team directly by landline or cell with the pick. Also, there will be a conference call for the length of the draft with club officials muted.

In other words, please don't forget to mute your phones!

In sum, we'll see how it goes. We're thankful for something "new" to watch for now.

Of course, whether these players and teams actually take the field in the fall – and whether anyone is in the crowd to watch if they do – are other matters entirely.

Moving on to those 'other matters' of people being outside...

Retirement Millionaire editor Dr. David "Doc" Eifrig recently received a lot of requests from subscribers for his thoughts on Porter's Friday Digest...

And Doc obliged in his latest COVID-19 briefing video with analyst Matt Weinschenk – the fifth in the series!

You can view Doc and Matt's video, which posted earlier today, for free right here. We urge you to watch the whole video for context, but here's an excerpt from Doc about Porter's return to the Digest. Doc said the two of them spoke about it this week...

Porter, like I said, I just adore him. And I adore that he pushes the envelope, wants us to think about stuff, but I'm not as extreme as he is.

I don't think, and have never thought, the end of the world is coming, and that Governor Cuomo wants to lock me up and throw me in jail and get rid of habeas corpus.

But we need to make sure that we don't allow them to do that because history has been filled with people that want to do that and try to do that.

Doc and Matt primarily covered the latest data on COVID-19 and updated their "best case," "baseline," and "worst case" scenarios of the pandemic and the economy. So again, if you haven't already done so, we urge you to take some time to tune in to their latest update.

Finally, a view from abroad on the oil-price collapse...

In the Digest, we've covered what's going on in the U.S. oil markets on Monday and again yesterday.

Today, our international editor Kim Iskyan provides a much-needed view from abroad...

Kim explains how the price crash could crush many emerging-market economies like Saudi Araba and Venezuela. And he begins with a report on a perhaps-overlooked recent development involving constant international provocateur... Iran.

Kim takes it from here...

As we wrote in the April 1 Digest...

An armed conflict involving Iran is probably a bigger threat than it was in early January, when a U.S. missile strike killed a senior Iranian military commander and brought the two countries close to war.

If things get worse, it's easy to imagine a desperate Iranian government throwing a Hail Mary to rally domestic support – by, say, launching a missile or two at a neighbor, in what is the world's most unstable region. And if it's aimed at the right place – a big oil pipeline, for example – it could also boost the price of oil.

Then... the price of oil collapsed, which put the Iranian government on life support with the plug about to be pulled (a stew of U.S. sanctions, COVID-19, runaway inflation = impending overthrow). In the meantime, U.S. leaders, many concerned about votes from shale-oil states in November, are searching for a way to backstop oil prices.

And suddenly... poof, a "two birds with one stone" event unfolded yesterday, when Iran said it had launched its first military satellite into space and President Donald Trump tweeted at the U.S. Navy to fire on Iranian gunboats... in a body of water that's the crossroads of the global oil trade in the world's most volatile region.

The Iranian government gets its "rally 'round the flag" moment to muster domestic support... and Trump and others get a higher oil price, at least for the moment (and there's nothing like the possibility of war to grab some attention from a pesky virus).

Moving on, a few weeks ago, I talked about how emerging markets get hit bad during a 'normal' economic crisis...

And COVID-19 and the policy response of lockdowns across dozens of countries is pouring fuel on the fire of emerging-markets crises.

The economic collapses in India, South Africa, Indonesia, and a lot of other developing markets will be helped by medicine equal to Mr. Universe-strength steroids.

And remember, unlike the U.S., Japan, or the European Union, these countries can't turn on the currency printing press to cover budget deficits, buy face masks, or pay soldiers. (Or rather, if they do, the inflation and other macroeconomic destruction that would follow would be like cutting off the patient's arms, legs, and head in order to save him.)

How could things get any worse for emerging markets? How about this... Cut a main source of revenue – oil – for economies like Nigeria, Venezuela, Russia, and Saudi Arabia... to (if they're lucky) around one-third of what it was just a few months ago.

The ongoing collapse in the price of oil is opening up a whole new world of pain for many countries...

Whether it stabilizes at $30 or $10 per barrel...

In broadly diversified economies, a total collapse in one sector of the economy – like, say, energy – is like dropping a big rock on a trampoline. All the marbles and pebbles on the surface (that is, other sectors) might get tossed about, but nothing too terrible happens.

For example, during a sharp drop in the oil price from 2014 to 2016, the economic output of heavily oil-dependent Alaska fell by 11%... more diversified Oklahoma experienced a modest recession... and West Virginia's gross domestic product ("GDP") growth stagnated.

But for the U.S. economy as a whole, it didn't matter that much. Growth in other sectors – technology, retail, real estate – helped balance it out.

But if oil accounts for 45% of GDP (like in Saudi Arabia) or more than 90% of exports (like in Kuwait, Azerbaijan, Iraq, and other countries), a total collapse in the oil price is like dropping a boulder on thin ice. As an article in Foreign Affairs magazine explained earlier this month (in the halcyon days of $28-per-barrel oil)...

If prices stay low for much longer, leaders of the G-20 and the international financial institutions will have yet another problem to worry about: sovereign debt risk emanating from nations whose economies are overly dependent on oil...

Rising insolvency in oil states would exacerbate an incipient meltdown in emerging markets.

In order to balance its budget, Saudi Arabia requires an oil price of around $80 per barrel...

Iran, which can't export much oil because of U.S. trade sanctions (and has experienced one of the world's most severe coronavirus outbreaks) needs an improbable $195 per barrel.

The currency of Nigeria (with a population of 190 million people), depreciated by 6% against the U.S. dollar earlier this month... but that's just the beginning, as the country gets 87% of export revenues from oil. And its 2020 national budget was based on an oil price of $57 per barrel.

When a country can't balance its budget or its exports collapse, it has to cut government programs, stop building infrastructure, reduce pension payments, and do all sorts of things that are considered political suicide and destroy the livelihoods of hundreds of millions of people.

When oil is the blood and oxygen of an economy, the second-order effects – that is, what happens as a consequence of that boulder breaking the ice – can be enormous.

For Venezuela, with the world's largest oil reserves and one of its worst governments, the drop in oil prices may finally bring down the president. Iran's President Hassan Rouhani was "poised to become first global leader toppled by COVID-19," wrote political risk analysts DaMina Advisors a few days ago – and the latest collapse in oil makes it all the more likely.

The sovereign bonds of Ecuador – which left OPEC earlier this year – have sold off sharply, with default as a rising possibility. The 5 million retail investors in Saudi Arabia that bought into the December initial public offering of Saudi Aramco, the world's biggest oil company, are going to be very upset as the share price wilts. And that's just the start.

As we've seen, the 'butterfly effect' is a real thing...

A guy eats a bat in Wuhan...

Some small country defaulting on its bonds could, say, slam the high-yield bond market... Political strife in Iran could lead to war in the world's most volatile region... A new government in Venezuela could launch a renewed flood of refugees.

The silver lining of a lower oil price is that energy importers – like India and Japan – have to pay less... but that's like a Band-Aid for a broken leg. And like in the U.S., $1-per-gallon gas is nice for consumers, but it hardly puts a dent in anything else.

New 52-week highs (as of 4/22/20): Franco-Nevada (FNV), Barrick Gold (GOLD), KraneShares MSCI All China Health Care Index Fund (KURE), Lonza (LZAGY), NovaGold Resources (NG), Polymetal International (POLY.L), and Wheaton Precious Metals (WPM).

In today's mailbag, feedback on yesterday's Digest about oil, the untold story of the COVID-19 crisis, and Greg Diamond's startling charts... Plus, the notes continue to pour in about Porter's latest Friday Digest, including a clever "bull" and "bear" comparison. Do you have a question or comment? As always, send it to feedback@stansberryresearch.com.

"Gas here in GA (30512) is 1.469, as of yesterday's trip to store. I had to get gas for lawn mower (alcohol free), it was about 1.709 gallon. Walmart's lots were fairly full, most people had masks on, but we still need to eat.

"This is a serious question, where can I buy one barrel of oil? I can store it in the safe room, once prices hit 70, I could sell it, for a nice little profit. Have the oil companies thought of asking the American people to store a barrel at home for them...

"Good Digest today [Wednesday]. FWIW–We have had poor people since mankind walked erect. We know beyond a shadow of doubt, the low income folks always share the burden of tough times, they do so in war, famine, disease, and have done so since this whole thing started. They will continue to do so, and handing out money free won't change that. Being poor is not only an economic problem, but, it could be a mental problem as well.

"It's not possible to change, if all the money of the rich was distributed out to the poor, in 6 months most of them would be out of money and poor again, with lots of stuff in the apartment, house, or wherever they live. Poor is also a state of mind, one which cannot be overcome unless you learn financial discipline, which is not taught in school anywhere, certainly not by the parents or grandparents. It's something you need to learn, but you won't unless you spend the time necessary to learn it.

"Then you, as an individual, can learn not to be poor again. you change your education level, to get a better job, you save more money, you don't have 65 kids, dog/cat/pets/ don't drink, smoke, illegal drugs or legal drugs, you learn to deny yourself many things and save the money otherwise would have spent.

"It's called discipline, self-discipline. It took me a bankruptcy, and paying back those I shorted to learn. Life's lessons are hard, some hard to kill you. That is part of life." – Paid-up subscriber Monty B.

"I'm in Panama, by choice. The people around me are poor. The average man will work 7-10 hours in a field for breakfast, lunch/dinner, when they quit between 2 and 3 usually, and $10...

"I do believe that qualifies this as a poor area. When the early social distancing was 'recommended,' people in the cities here were just like the cities there. They were on the streets, some partying. It required the government passing a law dictating who was allowed out when for how long, etc. to get some control.

"Here, where the people have to work, they quietly went about their business. You could see the change, almost no one going out to visit. Everyone paying attention to when and what days they're allowed out.

"In the city where they make enough to have a reasonable amount of discretionary money, they thought it was party time. Then it got serious, sale and use of alcohol has been outlawed until this passes.

"I do see some correlation to income; however I see a much greater connection to how the group has been raised. Here, when someone is sick, all of the neighbors help. In the city, they don't know the neighbors any more than back home. That's the root problem." – Paid-up subscriber Greg V.

"If the last two jaw-dropping charts [in Wednesday's Digest] shared by Greg Diamond don't make you stop in your tracks and do some soul searching then I don't know what will. We are in for a long haul." – Paid-up subscriber Greg N.

"Thank you, Howard, for your letter published in Wednesday's Digest. Unvarnished real-life experience beats intellectual ideology! Bravo and thank you!" – Stansberry Alliance member Jim B.

"Porter, once again you are 100% correct. So I am not crazy and someone else thinks like I do... Please give me permission to forward Friday's Digest to all my family and friends. I've been saying the same for weeks." – Paid-up subscriber Jim R.

Corey McLaughlin comment: Jim, thanks for your e-mail. As you might know (but we repeat here for informational purposes for all), our Digests are usually "subscriber only" for seven days...

But because of the feedback and requests we've received on Porter's Friday Digest, we've now "unlocked" his "Big Lie" essay for all of the public to see. You can find the essay on our Digest archives page here. Feel free to share it.

"Man, Porter is pissed and rightfully so. I couldn't agree more because he speaks the truth. I have stated some of these points to friends and relatives.

"But to keep this message short... I'm 73-years-old and scared. Not of the virus but the steps our politicians are taking. What we are seeing is a glimpse of what can be done to us. We act like sheep." – Paid-up subscriber James A.

"Porter's Friday Digest read like an old black label podcast episode. Minus the f-bombs, because short-armers ruin everything. Reading his sharp wit and poignant reasoning again put a smile on my face.

"I'm glad I'm not the only person flipping the table over the vacuous stupidity of government and people during the 'crisis.'" – Paid-up subscriber Kelly L.

"I found Porter's rant about a response to the coronavirus to be very interesting. He may be right about the strategy, but I don't think he needs to infer that it's part of a government conspiracy to steal our liberty. Well-intentioned stupidity would suffice." – Paid-up subscriber Jozseph W.

"Ok, Ok, enough already. We all have our opinions. Both sides have made valid points. Maybe we can just call it a draw for now. For the sake of stopping this argument before it gets out of hand, I would like to draw a comparison to the argument to shut down the economy...

"Let's call the party that want to keep living like nothing is wrong and it won't make a difference anyway, the 'Bulls.' Those that want to play it safe at home, of course the 'Bears.'

"Now I hope to never know what the outcome would be if the Bulls had their way, especially if things got really bad (deadly) and they were 'Melt Up' type bulls and refused to obey their stop-loss rule. Of course, a good bull would say at a certain death rate it would make sense to tap the brakes on the economy (keep kids and grandparents home). But then who would determine our stop-loss (death rate)? Everyone (the states) would want to make their own call on that. I can see where things might get ugly before the pain is felt across the entire nation (market). The proverbial 'blood in the streets' might be a reality.

"Now on the other hand the 'Bears' are always crying wolf on Wall Street years too early and missing out on all the fun. So while the bears are staying home and saving their money for a rainy day, it's spoiling the fun for the bulls that want to go out and play in the storm and complaining about the rules of the game.

"I'm sorry to say I don't have a 'moral to this story.' However let's just assume we let go of the reins just long enough for those voted into office to either come out on the other side a victor or get voted out down the road. Maybe this will let the bulls and bears remain friends and help each other at more important times." – Paid-up subscriber Paul J.

That does it for today.

All the best,

Corey McLaughlin
Baltimore, Maryland
April 23, 2020