2967, Coronavirus Fears Push DOW Down Despite Rate Cut, 2967

So originally, this story was about how to fix the national debt problem and how that ties in with today’s announcement by the Fed that they have implemented an emergency ½ of one percent interest rate cut to try to support the market in the face of spreading fears about the seriousness of the coronavirus.
My story started out like this, but then it morphed in the coronavirus fears and what you can do to keep safe.
Good morning, I’m still reporting on the economy. So for this Morning Update we’ll take a look at a story that just broke and then tie it in with the big, overall picture of what to do about the national debt.
So, about 10 am, the Fed cut interest rates by 50-basis-points, that’s stock-trader talk for one-half of one percent.
Why? What does that do for us?
Here’s what Investopedia has to say about interest rate cuts by the Fed:
“When the Fed cuts interest rates, consumers usually earn less interest on their savings. Banks will typically lower rates paid on cash held in bank certificates of deposits (CDs), money market accounts and regular savings accounts. The rate cut usually takes a few weeks to be reflected in bank rates.”
It’s not a wrong definition, but it is such a woefully incomplete definition.
Yes, your interest income is cut, and I guess that’s much more interesting to investors. But for the rest of us, lower interest rates makes borrowing easier. So interest rate cuts quickly stimulate borrowing. And since our money is actually all debt, that means more money and more debt pretty much immediately flood the system.
So the Fed just announced, while I was writing this a 50—basis-point rate cut.
The immediate effect was stocks surged after the half-point rate cut.
But then, within a half hour, the market reversed, and started down again. What’s up with that?
Well yesterday, the DOW saw its biggest one-day gain as coronavirus fears started to ease, so naturally you can expect some sort of a sell off the next day. However, the way the market initially turned up at the open, then sharply down again means that big investors are still thinking the way I’m thinking – that this could still easily be much worse than government is trying to convince us it will be.
I mean, the health minister of Iran yesterday went on state TV to say there are not 1,000 cases of COVID-19 – the official name of coronavirus – but 60,000 cases.
But none of the official agencies tracking coronavirus have modified their charts to show this huge increase in coronavirus incidence. This one from the U. of Washington still shows Iran at 2,336 confirmed cases.
Now, here’s the Johns Hopkins map. Shows the same for Iran, 2,336. So what gives? Who are we supposed to believe? Is not the health minister of Iran considered a confirming source of health information?
Now, there are conspiracy theories that Iran is hyping the problem up because it’s a scare tactic so they can justify cracking down on their civilian population all the more. But to me - and I’ve followed Iranian politics pretty closely for a decade or more – the mullahs of Iran already have their population under severe dictatorial control.
No, I think they are telling the truth because unless Iran’s population recognizes how serious this is, they will continue to go walking around the world touching everything in it with their two unsafe fingers, instead of their two good fingers, and as a result, coronavirus could continue to spike.
But here is a possible theory. What if the CDC is about the recognize the Iranian Health Minister’s claims and change their charts and graphs dramatically to reflect that coronavirus in Iran is actually twenty times bigger than previously reported?
Now that would collapse the stock market – unless the Fed was warned about the national security implications of this news and was reacting proactively and then the Iran situation will be announced later?
And yes, we will be getting back to the economy in a minute. But for now, back to Bill’s health lesson on your good fingers and protecting your bad fingers as your number one defense against coronavirus.
I went out and voted this morning and then I dropped by a convenience store to stock up on my fav caffeinated beverage for today’s labors. But when I slid my card in the card reader machine and it asked me to confirm my $5.12 purchase, I remembered to hit the green “Yes” button with one of my two good fingers, instead of my bad – my unsafe fingers.
Why such a big deal about not using your index fingers? Because your index fingers are what you stick in your mouth, your nose and rub your eyes with. These are three of the four major orifices where of viral infections get into the body. The other is your lungs. Yes, if you breath in someone infected person’s cough or sneeze, that’s bad. But most people don’t realize that getting the virus on your index finger with something as simple as touching a door handle or punching a pay terminal button at the grocery store is just