Reverse course!
German Chancellor, Angela Merkel, has apologized for calling for a lockdown in Germany over Easter after her people FREAKED OUT (Easter is a very big 4-day holiday there). During a press conference, Merkel said the Easter lockdown was formed "with the best of intentions. We must try to slow down the third wave of the pandemic. Nevertheless it was a mistake," Merkel said, adding: "Because at the end of the day, I carry the last responsibility. It's now important for me to say so here. A mistake should be called a mistake and above all it should be corrected, preferably in good time," she stressed, asking citizens for forgiveness.
Merkel said that on closer analysis, the planned shutdown risked doing more harm than good. She also said there was not enough time to adequately offset some of the problems that would come with it, such as lost earnings and working hours. "It was well reasoned, but was not really doable in such a short time," Merkel said of the Easter measures. "Many too many questions, from missing wages through to the loss of time in factories and facilities, could not be adequately answered in time."
In short, proper public health policy is taking a back-seat to Economic Policy in what, the day before, Merkel had described as an attempt to "break the exponential growth of the third wave." Yesterday, Germany had 15,813 new cases and 248 deaths. Here in the US, we had 58,764 new cases and 892 deaths, which is about right as we have 4x as many people as Germany – so we're in the same situation.
In other reverals of fortune that never happen when oil prices are high, a container ship has "crashed" sideways in the Suez Canal, blocking off the waterway that transports 1/3 of the World's oil. The cause of the accident, according to people in the know, was Oil prices slipping below $57.50 per barrel after night's weak API Report, which showed another 3M barrel build in US stockpiles. A day of ships have already been delayed and it may take a full week to catch up on the backlog and that has sent Oil back up from the low of $57.25 up to $59.50 this morning but failure at $60 (assuming they clear the canal today) could just be another shorting opportunity. The EIA reports at 10:30 this morning – we'll see how that goes.
A total of 29 oil, products and liquefied natural gas tankers were waiting on the south side and 15 to the north, according to ship tracker FleetMon. Suez Canal maritime services provider Leth Agencies said seven tugs have been dispatched so far, along with a dredger to dig out and refloat the vessel. “If it doesn’t work, then the ship must get partly unloaded so it becomes lighter,” said Fotis Pagoulatos, an Athens based naval architect, who has participated in past salvage operations. “This could take days.”
About 52 ships per day go through the Suez Canal, which runs 24 hours a day and it's not very easy to shove more ships into the schedule so it will take a very long-time to reduce what is likely to be a 100-ship backlog. This will add greatly to the already bad Global supply disruptions in chips and other goods – we even have a global shortage of shipping containers and keeping 100 ship's worth of them (2M) at sea for an extra week isn't going to help.
Toyota (TM), Ford (F) and GM (GM) have each curtailed production and closed plants due to supply shortages with the 2 US car-makers estimating this costing them about $2Bn in profits in 2021 – about 1/2 for Ford and 1/3 for GM. Since they have over $140Bn in sales to make those profits, even a $28Bn (20%) sales cut to each of them would have some very nasty economic impacts as the automakers consume less steel and parts and require less labor, etc. We wanted to bring the manufacturing home so a manufacturing slowdown hits us harder – at home…
Speaking of which, we just got our Durable Goods Report and, not surprisingly, it was down 1.1%. Well, when I say "not surprisingly", I mean to rational, thinking people as Bloomberg's Survey of Leading Economorons had forecast Durable Goods to be UP 1% – so they were off by 210%.
And speaking of rational, thinking people – those are not words Trump Lawyer, Sidney (the Kraken) Powell would use to describe Trump's supporters. She is being sued for all the false and misleading statements she made regarding election fraud on behalf of her client a few months ago and her defense is – get this – that she didn't do anything wrong because "NO REASONABLE PERSON WOULD HAVE BELIEVED THEM". That's righ, Ms. Powell is attempting to characterize lying under oath as COMEDY – she never expected anyone to believe what she and the President were saying – so how can you prosecute them?
Powell's defense is, essentially, that Donald Trump is such a known liar that any assertion made on his behalf in an election can’t be taken as remotely plausible by a rational human being. Colorado libel and slander law (where Dominion is located) requires the statements to be recognized as factual by a reasonable person.
The brief also shows screenshots of Powell on Fox News — as if to suggest that nothing said on Fox could be susceptible of being considered fact.
