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Sat Mar 21, 2020, 01:49 PM

Should Markets Be Closed?

I found the article on Barron’s. The link below the Barron’s link is to the original publication on jheconomics.com. There is a diary on DU discussing the topic. I am no expert and find the article below entertaining, and educational. Do I correctly have a “gut feeling” that ignorance is bliss. Don’t panic, stay calm and also, to repeat, do not panic.

(“how, in a desperate attempt to strike out some new line of fairy-lore, I had sent my heroine straight down a rabbit-hole, to begin with, without the least idea what was to happen afterwards” (Alice in Wonderland, biography Lewis Carroll @ britannica.com.)

https://www.barrons.com/articles/should-financial-markets-be-closed-over-the-coronavirus-51584735453

https://jheconomics.com/should-markets-be-closed/?mod=article_inline

Should Markets Be Closed?

Posted on March 20, 2020 by Alex Friedman | 0 Comments

Albert Einstein got so much right, so far ahead of his time, it is easy to forget he was ever wrong. But, one time he may have missed the boat is useful for us today as we try to navigate COVID-19’s unprecedented social and economic disruption.

Quantum physics has a concept called entanglement. In simple terms, it means that if a tiny object like a particle is observed, even a long way away (light years), that particle will change its properties. It reacts to the watcher. Einstein dismissed this idea as ‘spooky action at a distance,’ but over time science has proved him wrong. And recently, we have learned that all kinds of objects interact with each other at a distance, even large ones like a satellite in space reacting to something on earth at the quantum level.

Today, our species is in panic. COVID-19 is driving upheaval in every human realm. There can be no doubt that the primary mission is to slow the spread of the disease and develop a vaccine as soon as possible. But a close secondary critical mission is to protect our global economy. If we don’t succeed here, it is not far-fetched to fear that society may unravel in fundamental ways at extreme human cost. And the biggest secondary threat we face from the virus is panic.

Financial panic is a kind of quantum entanglement. Our global economy is nothing more than a giant multi-player game of pong, with each person’s motion bouncing off of another, forever. At each bounce, a good or service is exchanged and resulting monies (energy) move in a slightly different direction. All financial markets are basically built on predicting direction of motion and rates of velocity, present-valued to discount future interactions as well.

Today, financial market participants are mostly blind to the true trajectory of COVID-19 and will remain so until there is (i) an effective containment of the pandemic in the major economies, (ii) belief that governments are undertaking sufficient steps to spur demand via fiscal policy, to underpin the ‘plumbing’ of the financial system via central bank action and to backstop credit via state guarantees and (iii) confidence that asset prices properly discount the impairment to earnings (equities), to financial disintermediation (credit spreads) and to growth (yield curves).
...snip more at link above

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Reply Should Markets Be Closed? (Original post)
saidsimplesimon Mar 21 OP
Wellstone ruled Mar 21 #1
customerserviceguy Mar 21 #2

Response to saidsimplesimon (Original post)

Sat Mar 21, 2020, 02:56 PM

1. Yes,same rules as 9/11

and for Lehman. Otherwise,we are headed for a Hoover Recession/Depreciation.

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Response to saidsimplesimon (Original post)

Sat Mar 21, 2020, 03:20 PM

2. There are all kinds

of secondary gambling sites to make alarming financial news. That futures market that seems to predict what's going to happen the next morning? You can't shut that down.

Even if you tried, somebody's going to invent an offshore substitute for it. Gamblers gotta gamble, they're addicts.

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