Here's What You Need to Know About the Pandemic Crisis
Here's what you need to know about the pandemic crisis... Watch our special 'Town Hall' event right now... Where's the 'coronavirus crisis' bottom?... The 'panic low' might still be coming... We're unlocking Ten Stock Trader... The Fed goes to zero... A smart view from abroad...
This is must-watch viewing...
People around the world are consumed by fear of the coronavirus pandemic. And the markets are roiling as a result, finishing down about 12% today... and selling off 3% in the final hour of trading as President Donald Trump said the crisis could stretch into August.
The decadelong bull market has given way to a full-fledged bear market. Volatility is reaching levels last seen during the 2008 financial crisis.
It's natural that you would have questions about how to stay safe and protect your investments. That's why we scheduled our first-ever "Town Hall" meeting this afternoon...
We gathered many of our top analysts to talk about what they see happening and to share their ideas for navigating this unprecedented event. In anticipation of our Town Hall, we asked for your questions... and we received hundreds from you, our loyal subscribers.
We broadcast the Town Hall at 3 p.m. Eastern time today. We had a lot to talk about... and we thank those of you who sent in questions over the weekend. We couldn't get to all of them, but we covered as many of the frequently asked ones as possible during the 90-minute session...
Our publisher Brett Aitken, director of research Austin Root, Retirement Millionaire editor Dr. David "Doc" Eifrig, True Wealth editor Dr. Steve Sjuggerud, Extreme Value editor Dan Ferris, Stansberry's Credit Opportunities editor Mike DiBiase, and Ten Stock Trader editor Greg Diamond had a great, insightful discussion...
They covered your questions on the recent price action in gold, bonds, where stocks might be headed, and what to do right now. Plus, Doc shared his latest take on the spread of the coronavirus... Greg spoke about the critical technical outlook of the markets... and the group covered much more.
Here's just one gem from Steve on whether now is the time to buy or not...
The progress of the virus will be different than the path the markets take. We may see significantly more and more bad news from the virus... But there will be a point when the news will get "less bad."
That's when we want to be buyers of this market. But that moment is not here yet.
And as Brett explained near the start of the broadcast, we're not selling a thing during this event, either. This is purely information that we believe is valuable for all of our subscribers to have at this moment in time. It's what we would want if our roles were reversed...
Go to StansberryTownHall.com to watch a replay of this special event right now.
We plan to keep the video available all week. But with the way things are moving, we urge you to watch as soon as you can... You can pause, fast-forward, and rewind at your leisure.
Where's the bottom?
In last Monday's Digest, we told you that Greg believed the broader trend in U.S. stocks was still "down."
Even before the most recent dive today coming off of Friday's historic rally, Greg's outlook remained the same when he wrote to his Ten Stock Trader subscribers early this morning.
Greg said to watch the benchmark S&P 500 Index's 2018 lows being tested this week... and that highs in the S&P 500 from back in 2015 and 2016 are now in sight. He shared this chart and context with Ten Stock Trader subscribers today...
The 2018 low near 2,300 will be tested likely today or this week. Recall the Weekly Market Outlook last week in which I said that an extension beyond the 2,605 level targets the 2018 low near 2,300. The S&P 500 cruised through 2,605 with ease.
The rally from Friday is still within a downtrend – very important to keep that in mind. Don't pay attention to the percentage moves (as big as they are), focus on whether or not a stock or index can make a higher high to break the downtrend structure.
So far the S&P 500 has not done this since topping out last month.
Greg said he doesn't think we've seen the 'panic low' yet...
2,300 is also where a lot of sell stops will be located for investors. This is a logical target to really shake out "long term" investors and create a real panic.
The speed of this decline is unmatched in history. It is setting records by the day. Yet I do not believe we have seen the panic low yet. 2,300 seems like a low to target for that to happen at a minimum.
Also note the other major indexes like the Dow Jones Industrial Average, the Dow Jones Transportation Average, and the Russell 2000 have already traded below their respective 2018 lows. The S&P 500 is likely to follow.
Take notice. And please, as we always stress... stick to your stop losses. Greg has been nailing the key technical levels over the past month, so it's critical that you remain cautious.
Along those lines, we have good news...
In the next few days, we're going to unlock Greg's Ten Stock Trader for free for at least the next 30 days.
Like some news websites do during natural disasters, given the historic volatility we're seeing today, we've decided to make Greg's intraday technical analysis free to all Stansberry Research readers.
In fairness to Greg's current subscribers, we won't share his trades. But we believe you'll find his market updates extremely valuable in today's conditions. As we wrote in the February 27 Digest...
When it comes to considering the "key levels" in any market environment and "tops" or "bottoms" in volatile times like these, it's incredibly useful – if not critical – to look at what the technical indicators are saying.
If you don't already have access to Greg's Ten Stock Trader, stay tuned to the Digest for a link as soon as it's ready. We hope this content will guide you in the coming days and weeks.
Apparently, the Fed governors are working at home, too...
The Federal Reserve announced its latest round of stimulus efforts on Sunday.
A few days ahead of its regularly scheduled meeting, the central bank said it was cutting its benchmark funds rate by 1% to a range of 0% to 0.25% and also pumping its bond holdings by $700 billion.
This development meant our Stansberry NewsWire editor Scott Garliss was working this weekend, too. He updated readers on Sunday evening in our free news service...
These moves are being done to encourage banks to lend. The Fed wants to make sure businesses of every size are able to access the necessary funds to keep businesses viable and people employed. Banks are gaining access to cheap funds and won't be constrained on their balance sheets.
But the thing is, cutting rates doesn't do much if people are just staying home... not buying anything. Investors basically said "meh" to the move on Monday... with the three major U.S. stock indexes down roughly 9% for most of the day. Yikes.
This isn't the first time the Fed has dropped its benchmark rate to zero... Rates were held at that level between December 2008 and December 2015 to help the U.S. economy handle the Great Recession.
At least we made it more than four years with positive rates. As Scott continued...
These are the steps the government used to battle the financial crisis... Except now, it's getting ahead of the ball instead of taking time to figure it out.
A reminder: To keep current with all the news moving the markets, be sure to subscribe to the NewsWire for free right here.
Finally, our international editor Kim Iskyan shares some useful perspective from abroad. Take us home, Kim...
Around a month ago, Singapore – where I (Kim Iskyan) live – ranked second in coronavirus cases for countries behind China.
Today, it's 26th. The number of cases here in Singapore is rising, but only in the low double-digits. Though the threat is far from over, it's under control – and the panic buying of rice and hand sanitizer is long past.
Singapore's success at controlling the coronavirus – also known as COVID-19 – is due in part to the entire country being only a bit physically larger than Columbus, Ohio. It has as many people as the Washington, D.C. metropolitan area.
In other words, it's a lot easier to get things done – track down infected people, force office buildings to take the temperature of anyone entering them, distribute facemasks to every household – in a small, densely populated country.
But enacting these policies would be a lot more difficult if Singapore wasn't a highly disciplined place... It's part of the history here.
On Sunday night, the government issued a notice that anyone returning from one of the other 10 Association of Southeast Asian Nations ("ASEAN") or a long list of European states needs to self-quarantine at home for 14 days... And there's very little doubt that everyone who falls into that category will do as their told.
"Serious consequences" in Singapore are, well, serious...
When the government here says 'jump,' the only question is 'how high?'...
Singapore has a uniquely strong sense of purpose – and paranoia...
Within the span of a few generations, the country rose from mucky tropical swamps to become one of the richest countries in the world. And Singapore's per capita military spending is the fourth-highest in the world (trailing only Saudi Arabia, the U.S., and Israel).
People here know how to pull together to fight a common enemy.
And maybe most important, Singapore's government is extremely competent. Government ministers are paid like CEOs... and bureaucrats at every level are compensated well. People here aspire to work for the government...
As a result, government policies are data-driven, thoughtful, and carefully implemented.
Because of all of this, Singapore reacted quickly and effectively to the coronavirus threat...
For weeks, you wouldn't have been able to swing a suitcase at Changi Airport – a major crossroads through Asia – without hitting a temperature-monitoring station.
Go into a mall or an office building... and you'll get your temperature taken. Over the weekend, just to enter a hotel downtown to visit a rooftop bar, I had to fill out a form. Anyone with a fever can visit a clinic and, if necessary, get tested and treated – for free.
It helps that Singapore has the resources and infrastructure to protect its people and implement measures that wouldn't be economically feasible in most other countries.
With money, a visionary government can implement a strong health care system that can learn from experience – as Singapore did with the severe acute respiratory syndrome ("SARS") breakout in 2002.
What lessons does Singapore hold for countries that are just now staring the challenge of "flattening the curve" in the face?
By that, we mean slowing the spread of the virus as to not overwhelm health care systems, a situation that Stansberry Research editor Thomas Carroll described in Friday's Digest.
Unfortunately... culture, discipline, and planning don't travel like this virus. In my view, the horse has left the stable for the U.S. and other countries on the "start early and push hard" front.
New 52-week highs (as of 3/13/20): Digital Realty Trust (DLR).
In today's mailbag, a few subscribers write in to say thanks for the guidance. As always, send your notes to feedback@stansberryresearch.com... And again, thank you to all of you who sent in questions for today's Town Hall. You can watch the replay right here.
"I just looked at this newsletter ('Four Things to Know as Stock Markets Fall') and, you know, over the years you all at Stansberry have taught me all of this stuff. I put it to work all of last week. Based on all of the panic that is going on at the moment I realize that I am calm. I am watching what I need to watch and doing what I need to do. One of the most interesting things is that I have kind of felt something about this maybe a month or two ago.
"I started buying gold. Looked at buying farmland and even worked on a deal to make the purchase. That fell through because I couldn't finance it the way I wanted to. But the important thing is that I knew what I was doing. This is thanks to all of you." – Stansberry Alliance member Jeff S.
"Re: your update on how to navigate this bear market: Your wife was right, Steve. This was unique and unforeseeable. I believe in your guidance throughout this bull market, including recently.
"And your message now is wisdom for this time: adhere to the trailing stops, and wait for the market to resume its uptrend. I also believe it will, and I'm grateful to have you (and the Stansberry team) to guide me back in." – Paid-up subscriber George M.
All the best,
Corey McLaughlin
Baltimore, Maryland
March 16, 2020