More SX Cancellations

We need millions of reliable test kits and labs set up to process them fast RIGHT NOW. This is the only way the economy will not get crushed. If we have test data, people do not have to isolate unnecessarily. This bug has an asymptomatic contagious period of up to a week, meaning just because you do not have symptoms it does NOT mean you should not be tested (which is the current position). This is basic math. The only way to get a handle on this is test test test. The practice right now (test only if you have symptoms) is being driven by a severe lack of test availability. This is a massive failure of leadership. This is like a basic test of competence for a nation, and the US looks like it is failing.

https://www.sciencenews.org/article/coronavirus-most-contagious-before-…

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BREAKING: 8 of the biggest U.S. banks say they will suspend share buybacks though Q2 of 2020. The banks are: Bank of America, Bank of New York Mellon, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, State Street & Wells Fargo.

This is bad....

BREAKING: The @CDCgov just sent out an alert that "recommends that for the next 8 weeks, organizers (whether groups or individuals) cancel or postpone in-person events that consist of 50 people or more throughout the United States."

I'm in the process of buying a house. I wonder what that means for interest rates on mortgages.

Since Feld, the AMA, The FIM and the riders are all losing money doing SX it seems like it will be a relief to everyone that they don’t have to do anymore this year!

No Sx for a while...

Based on only testing those that show symptoms and present to be testing. Many fear they will be charged for it (they often will) so simply self isolate without ever being tested.

These number are artificially low do you not enough test kits and not testing broadly. Those in age 20-29 have the highest rate of contraction of the virus in South Korea but are less likely to show symptoms and therefore less likely to be tested in America. This means they are simply carriers passing it on to those that a vulnerable.

As the best test kits in the world from the best doctors in the world in the country handling it in the best way in the world become available you see the rate rise and rise and rise....

There will be no bank runs. You have no clue what you are talking about. So stop with the uninformed, paranoid nonsense.

For a long time, reserve requirements have not acted as a binding constraint on banks’ ability to lend and consequently their ability to create money. The reality is that banks first extend loans and then look for the required reserves later. And Central Banks have long adopted a period of 100% accommodation. That means if banks can find capital nowhere else...they can ALWAYS get it from the CB.

In reality, "cutting the reserve ratio" to zero is really just the other side of the 0% rate coin. If the cost of money is ZERO....and you can get $ for an purpose that by accepted risk metrics will produce a return, why do you need reserves?

So again...why do you go posting paranoid nonsense you have no understanding of. What good are you doing anyone?

Good luck with your sky daddy....

I have to disagree with your 'bank runs" statement....

The Federal Reserve suspended its 10% reserve requirement on banks' deposits - - this is an enormous free-up of funds that earned nothing at the Fed as it was held in reserve. This money can now be plowed into loans and securities. Banks don't have to reserve (or set aside) as much against loans. This also helps offset loan losses as they (the banks) support difficult clients. All this should help maintain decent profitability for the banks during this period. It further assists in banks' effort to provide liquidity to markets as other financial institutions back out of providing loans, buying securities of issuers that will be downgraded. This is a coordinated exercise between banks and Fed, and is prudent...... This is really "non-moto" stuff

???? I have nothing....

Hi Premix

I thought it smelled.

When banks make loans, they create money through double entry book-keeping. 93% of the dollars on the books in the world were created through bank loans. You believe that Monetarist crap. None of Friedman's money multiplier crap is even taught in textbooks any more.

Kindland and Prescott, Nobel award winners, once set out to do research to prove your (and Friedmans) money multiplier nonsense true. They found there was NO empirical data to support it. Just because it was published in textbooks does not mean it is correct. The current "banks as intermediaries" theory is also nonsense.

People who ACTUALLY WORK for Central Banks and major banks know how things really work, and they do not work like the text books say.

To educate yourself, why don't you read the following:

Staff Working Paper No. 761Banks are not intermediaries of loanable funds — facts, theory and evidence

https://www.bankofengland.co.uk/-/media/boe/files/working-paper/2018/ba…

To demonstrate that the function of banks is indeed monetary financing as described in the FMC model, we study the procedure that a bank uses to make a new loan to a customer X.6The bank simultaneously creates a new loan entry, in the name of X, on the asset side of its balance sheet, which represents its right to receive future installments and interest on the loan, and a new and equal-sized deposit entry, also in the name of X, on the liability side of its balance sheet, which represents its obligation to deliver current funds. The key observation is that in the case of banks this newly-created “accounts payable” liability (IOU) to deliver current funds can immediately be used as current funds, as money. Only banks have this ability, because only banks are perceived to be able to credibly commit to honouring their IOUs universally (that is, vis-à-vis any subsequent holder of the IOU), thereby making these IOUs acceptable as a universal medium of exchange, or money.


Working Paper No. 529Banks are not intermediaries of loanablefunds — and why this matters

https://jrc.princeton.edu/sites/jrc/files/jakab-kumhof-boewp529.pdf


The fact that banks technically face no limits to increasing the stocks of loans and deposits instantaneously and discontinuously does not, of course, mean that they do not face other limits to doing so. But the most important limit, especially during the boom periods of financial cycles when all banks simultaneously decide to lend more, is their own assessment of the implications of new lending for their profitability and solvency, rather than external constraints such as loanable funds, or the availability of central bank reserves.

This is EXACTLY how the financial crisis happened. Banks are able to create loans based only on justification that the loan will be profitable. When the PRICE of the asset class they are making loans against is used as the justification for making the loan, you have circular logic, a positive feedback loop. If the nonsense you are saying were true, we would not have had a financial crisis in 2007-2009.

So are you saying the Bank of England is wrong about how banks work in practice? They are all structured essentially the same.

Here is another paper by Standard and Poors, explaining exactly why you are wrong:

Economic Research:Repeat After Me: Banks Cannot AndDo Not "Lend Out" Reserves

https://www.hks.harvard.edu/sites/default/files/centers/mrcbg/programs/…

I am offering you a chance to really improve your understanding of how the system really works. Take advantage of it.

You are talking about how things "should be". I pay attention to how things are. If you want a road map of where the US is heading, just look at Japan. They had their credit mania and crash in 1990, 18 years before the US. We are following their "post credit crash" roadmap almost EXACTLY.

Scratch and Sniff,

Here are some more for you to educate yourself:

https://www.youtube.com/watch?v=IzE038REw2k

https://www.youtube.com/watch?v=XAoaTg0l7K8

The crazy thing is, 100 years ago, the Credit Creation Model was the known model. In other words, we had it right a century ago, and for the last 100 years the mainstream economics establishment has taught nonsense.

Well looks like You'll have to hook up our team with delicious drinks at the next ADAC SX.
And I say that with full positive hope, that the economy will recover in time, so that we'll be able to run those ADAC SX races this year....

Ain't over yet, SlaveO

San Francisco just instituted a (for now) 3 week curfew.

https://www.cnbc.com/2020/03/16/san-francisco-orders-residents-to-stay-…