Massive Deflation in Progress, Blamed on “Virus”

Headlines from WOLF STREET
27 April 2020

Wolf Richter Rails Against Mexican Companies that Borrow in Dollars and then Get Bailed Out When it Blows Up, Which is Now
by Nick Corbishley • Apr 27, 2020 • 10 Comments
“I want these f**kers to collapse and their CEOs thrown into a Mexican jail for having borrowed in dollars. I want shareholders and bondholders to pay the price, not the people. Let them eat their dollar-bonds.”

How the Unicorn Blowup & Oil Bust Bleed into Commercial Mortgage-Backed Securities
by Wolf Richter • Apr 26, 2020 • 132 Comments
CMBS get to eat it all: Amid overvalued vacant collateral, there is a new thingy: Tenants delaying rent payments and landlords asking for forbearance.

Supermarket Sales Jumped, Alcohol Sales Spiked 33% & Online Grocery Sales 100%, But “Non-Food” Sales Collapsed
by Nick Corbishley • Apr 25, 2020 • 135 Comments
How the Virus Crisis Flipped UK Retail Sales Upside Down.

Used-Vehicle Wholesale Volume Collapsed, Prices Drop: Mega-Pain for Automakers, Leasing Companies, Rental-Car Companies, Banks, Bondholders, Stockholders
by Wolf Richter • Apr 24, 2020 • 201 Comments
No one has ever seen a mess like this before.

Tourism in Southern Europe, Accounting for 13%-21% of GDP, is on its Knees. When Will it Get Back Up Again?
by Nick Corbishley • Apr 24, 2020 • 97 Comments
“First sector to be afflicted by the virus crisis and, unlike other crises, likely the last to recover from it.” And these economies are still incredibly fragile, even eight years after the last crisis.

Fed Cut Back on Helicopter Money for Wall Street & the Wealthy
by Wolf Richter • Apr 23, 2020 • 155 Comments
Tapered QE-4 Further, Still Hasn’t Bought Junk Bonds or ETFs, Was Just Jawboning.

Postmortem of the Infamous Day WTI Crude Oil Futures Went to Heck in a Straight Line
by Wolf Richter • Apr 23, 2020 • 62 Comments
The US Energy Information Agency (EIA) dissects the historic event.

Week 5 of the Collapse of the U.S. Labor Market
by Wolf Richter • Apr 23, 2020 • 220 Comments
Gut-wrenching tally balloons. Gig workers and contract workers are starting to be included. Florida tries to catch up.

Housing Market under COVID-19: Regular Folks Retreat, Foreign Investors Blocked, Large US Investors Gone, iBuyers Frozen
by Wolf Richter • Apr 22, 2020 • 176 Comments
Demand is a lot weaker in some places than in others. Here are the 20 cities with the largest drops.

U.S. Shale Faces Largest Ever Drop in Fracking Activity
by Rystad Energy • Apr 22, 2020 • 31 Comments
“With such rapid decline in fracking already visible, very little activity will be happening in the oil basins during the remainder of Q2.

Market Mayhem Meets Liquidity Mismatch: “At Least” 76 Mutual Funds in Europe Were “Gated” in March
by Nick Corbishley • Apr 22, 2020 • 54 Comments
Due to “the interconnectedness of the financial system” fund gatings can trigger “contagion risk” with “the potential to become a systemic issue”: Fitch

How Far Will the U.S. Economy Plunge During Lockdown?
by Wolf Richter • Apr 21, 2020 • 387 Comments
“Three times deeper than the Great Recession?”

Mainland Chinese Stop Buying Hong Kong Residential Properties, Try to Unload What They Have, Prices Follow
by Nick Corbishley • Apr 21, 2020 • 119 Comments
“Some forced selling is highly likely.”

Holy WTF Moly: WTI May Contract Collapses to Negative -$37
by Wolf Richter • Apr 20, 2020 • 258 Comments
Meanwhile this is a moment for historic reflection and head-shaking.

US Crude Oil Gets Annihilated Under Targeted Saudi Attack
by Wolf Richter • Apr 20, 2020 • 153 Comments
West Texas Intermediate (WTI) futures collapsed 45% today from the already collapsed price, to $10 a barrel, lowest since 1999.

Munger: “Nobody Knows What’s Going to Happen.” And This Time, Berkshire Is Not Piling into Stocks & Companies
by Wolf Richter • Apr 19, 2020 • 156 Comments
“I don’t think we’ll have a long-lasting Great Depression…. But we may have a different kind of a mess. All this money-printing may start bothering us.”

Demand for Bank Notes in Dollars & Euros Spikes Despite Fears of Covid-19 Contaminated Cash
by Nick Corbishley • Apr 19, 2020 • 102 Comments
A curious phenomenon.

What U.S. Cruise Lines Are Up Against. And No Bailout Money
by MC01 • Apr 18, 2020 • 193 Comments
Their megaships turned from a revenue-generating asset into an expensive-to-maintain nightmare.

Coronavirus Drives Barrage of New Lobbying Activity
by Wolf Richter • Apr 17, 2020 • 136 Comments
Follow the Bailout Money.

There’s a Significant Risk of Cascading Defaults in Form of a “Debtors’ Strike”
by Karen Parker Feld • Apr 17, 2020 • 275 Comments
The bailouts are better described as an organized protection racket run by banks, hedge funds, private equity investors, and large corporations.

Fed Massively Tapered QE-4. Hasn’t Bought Any Junk Bonds, Was Just Jawboning
by Wolf Richter • Apr 17, 2020 • 128 Comments
Helicopter Money for Wall Street & the Wealthy: $2.06 Trillion in 5 Weeks. Regular folks, forget it.

How Will Covid-19 Lockdowns Hit the Housing Market? It Gets a Little Clearer
by Wolf Richter • Apr 16, 2020 • 167 Comments
“In May, what market? I don’t see no market”: Realtor.

Week Four of the U.S. Labor Market Collapse
by Wolf Richter • Apr 16, 2020 • 196 Comments
These layoffs are gut-wrenching and gigantic. But six states reported “fewer layoffs” in some industries – as there are not that many people left to lay off?

Here’s Where Retail Sales Spiked and Collapsed in 11 Mind-Blowing Charts of Lockdown Land
by Wolf Richter • Apr 15, 2020 • 165 Comments
But department stores will never recover; they were toast before the lockdowns.

U.S. Oil Drilling Grinds to Halt at Key Shale Hotspots
by Nick Cunningham • Apr 15, 2020 • 87 Comments
The sudden declines in production illustrates the fatal flaw in the shale business model.

From Panic-Buying to Lockdowns of Eateries & Manufacturing: Truckers, Railroads Face Supply Chain Turmoil, Spikes & Plunges
by Wolf Richter • Apr 14, 2020 • 168 Comments
“There has been a clear divide between winners and losers.”

“Something Has Gone Wrong”: UK Government, Banks Screw Up Coronavirus Loans, Small Firms Near Collapse. Better Results in Other Countries
by Nick Corbishley • Apr 14, 2020 • 52 Comments
Part of the problem is cultural: big banks in the UK don’t like lending to small businesses, especially not at 1.5%.

SoftBank’s Fake Startup “Valuations” Come Unglued
by Wolf Richter • Apr 13, 2020 • 147 Comments
But those paper gains were fun while they lasted.

Farm-Labor Crisis under COVID-19 Sends Countries Scrambling
by Nick Corbishley • Apr 13, 2020 • 149 Comments
Miserable, crowded living conditions of Europe’s foreign farm workers put them at much greater risk. And they’re staying away.

Going to be Tougher for Lots of People to Even Get a Mortgage. Expensive Housing Markets Most Affected
by Wolf Richter • Apr 12, 2020 • 205 Comments
Availability of Jumbo Mortgages Plunges.

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