Daily Briefing – April 28, 2020

Published on
April 28th, 2020
36 minutes

Daily Briefing – April 28, 2020

Daily Briefing ·
Featuring Nick Correa, Ash Bennington, and Ed Harrison

Published on: April 28th, 2020 • Duration: 36 minutes

Ash Bennington hosts Real Vision's Managing Editor Ed Harrison to discuss recent developments in markets, macro, and the coronavirus crisis. Today, Bennington and Harrison discuss the U.S. recession outlook, economic sentiment, and whipsawing prices in global oil markets.



  • CP
    CRAIG P.
    1 May 2020 @ 05:20
    Ed (and also Ash), you need to learn to "draw" your invisible charts ("V" and "L") from right to left, not left to right. You are drawing them for yourself, not for the audience. For instance, if you draw in the air an "L", it should look like this to you.: i l l ____ It will appear like an "L" to your audience.
  • GT
    Guillaume T.
    30 April 2020 @ 18:00
    Nice work on the introductions by Nick Correa, pleasant watch, and listening. Clean and simple!
  • IP
    Isaiah P.
    29 April 2020 @ 22:15
    Are we going to need a catalyst (resurgence in an opening region) to have the market "snap-in-lin" with economic fundamentals (if it will), or is it going to be a slow realization of underlying conditions?
  • JR
    Je R.
    29 April 2020 @ 12:16
    "... France, interestingly enough, when you combine public and private debt together, that is a house of cards that is potentially a combustible" It's a veritable cathedral!
    • DS
      David S.
      29 April 2020 @ 22:01
      Je R. - Aren't we all ? DLS
  • HC
    Hahns C.
    29 April 2020 @ 21:54
    It is frustrating to place trades to downside and loss money - lots of it. Depressing to know a real live "depression" is here, but the equity markets don't reflect the current, near term or even 18-month forward looking economic conditions. I think the Millennial generation can't catch a break, they were hit by epic events in 2001, 2008 and 2020. My 25 yr-old son is finally out of law school this July (with 6-figure $$ debts)- let's pray he keeps the position he was offered last summer. If the Administration and Congressional politicians think they have it rough from press today - wait until the S&P hits +3,000 and the unemployment rate hits +18 to 20%. Civil unrest from splinter groups like Antifa, BLM, or far-right and white supremacist groups in the US are potentially a factor that is not being discussed. There is a fierce growing resentment towards China today - similar to the way Germans resented the wealthy Jews in the 1920's for the economic hardships of that era. Vielen Dank für die tolle Show.
  • KC
    Kirk C.
    29 April 2020 @ 21:43
    gdp down 35% requires 17 years of 2.5% growth, year after year, no recessions, to get back to January 2020 level of gdp - where will the financial capital of the world be - USA or some Asian country - stay tuned
  • FB
    Frank B.
    29 April 2020 @ 19:44
    Always impressed by the amount of new info and insights you deliver every day. There is so much news flow and data out there. How do you track all of this, review and contextualize it in these most unusual times and then present it so eloquently here? For example you just discovered negative put options... Makes me wanna witness a working day of Ed and Ash to see how they do that. I'm already overwhelmed by my office emails ;-)
  • JJ
    John J.
    29 April 2020 @ 19:38
    I LOVE this program!
  • AW
    Aaron W.
    29 April 2020 @ 19:36
    When Ash finally converts from bearish to bullish that might just be the top of the market's bounce ; )
  • RK
    Ron K.
    29 April 2020 @ 13:47
    Good to get our downbeat Ed back again today, I was not buying it yesterday.
    • EH
      Edward H. | Real Vision
      29 April 2020 @ 14:40
      It's the same view though, meaning near-term bullishness on Europe's post-lockdown trajectory followed by a longer-term malaise as a base case. Monday, the concentration was on the near term (relatively upbeat) and yesterday's concentration was on the longer-term risks (relatively downbeat).
  • SC
    Sean C.
    29 April 2020 @ 14:33
    You had put options trading at negative prices? Do you mean you had negative strike put options trading at positive prices?
    • EH
      Edward H. | Real Vision
      29 April 2020 @ 14:37
      Right, strike price not bid price https://twitter.com/JavierBlas/status/1254889261951782912/photo/1
  • LL
    Linda L.
    29 April 2020 @ 02:26
    Great briefing! I know it must be hard to keep the briefing interesting and relevant on a daily basis that is stretching on for weeks. As you analyze the market impact - could you give your input on buybacks? In the last few years RV experts have said repeatedly that the only buyer of stocks were corp buybacks. Have the buybacks stopped? and if so why is the market still going up? Also is there any contagion effect rippling thru the global economy? Are oil, and repo markets symptoms of a crisis brewing that has yet to surface in the financial markets? It seems to me that the Fed is going to run out of fingers to plug holes in the Dam. Is there any hard data analysis on the financial impact of labor market decrease vs Fiscal and Monetary stimulus? In other words, is the stimulus equal to the payroll loss and business losses? How much would it take to be equal on a sustained basis? Same question with the Hi Yield market - can the Fed print enough money to keep all the fallen angles afloat?
    • DS
      David S.
      29 April 2020 @ 13:58
      This morning when I awoke to US equities up another 2% I wondered too, who is buying these stocks? Buybacks?
  • MB
    Mark B.
    29 April 2020 @ 13:18
    Chide positively to renew... offer generous praise where its due! Today’s Daily briefing was way better, showing a marked improvement over yesterday and return to form, so thank you both for that, keep up the better focus and incisive perceptive observations, commentary, and most of all balanced observations.... For my own part I think your observations at the end of the video were insightful albeit that I don’t agree with them re the lock down. IMHO the US is way too optimistic about resuming activity. The Singapore and German experience highlight that the post lock down economic activity and max capacity / supply / demand is going to be at a NEW normal and that will be substantially lower than the previous relationship of activity to profit permitted where fixed costs and prior commitments will require an adjustment many, many business’s just aren’t capable of making and results in Raoul’s doom loop scenario.... Markets have not woken up this reality.... YET! But when they fail to get out of lock down in early / mid May as anticipated it will begin to dawn on them everything is not quite so good as current valuations require and the old adage of sell in May and go away may really take hold!! Lets see what US GDP tells us in a minute or two! Best, and thanks.
  • DF
    Diamantino F.
    29 April 2020 @ 12:53
    When will fight the Fed Raoul be giving us his take on what going on? Agree with ED, here in Europe slowly going back to normal... so we hope !!
  • SM
    Stephan M.
    29 April 2020 @ 07:31
    Dear real vision, can you talk about some investment ideas in the current crisis - what would work rather than talking about oil which is nearly unpredictable. Some businesses are not effected than others. Good places to be are maybe food, some residential REITs, and special consumer goods. Their dividends seems more stable to me in the coming months. Since the crisis started I add ADM, KMB, AFL and IRT to my portfolio but missed to buy more from the IT Sector in the liquidation phase.
    • TM
      The-First-James M.
      29 April 2020 @ 11:32
      Regarding pil, Tankers have been a fantastic long trade so far. See the March interview with Harris Kupperman. These stocks have now run a long way, but I suspect they have further to go, given the magnitude of the current supply glut and what it is turning into. This will be exacerbated further if Trump and Mnuchin are stupid enough to attempt to bail out the US Oil Sector at Taxpayer expense.
    • TM
      The-First-James M.
      29 April 2020 @ 11:33
      ...Regarding Oil, even... Darned stupid typo.
  • JO
    Johnny O.
    29 April 2020 @ 11:24
    Howard Marks: we're down only 15% from what were all-time highs, but it seems like things are more than 15% damaged (paraphrased). Me: sell in May and go short.
  • IH
    Ian H.
    29 April 2020 @ 10:31
    Something that I keep trying to wrap my head around. PreCovid-19 wasn't growth directly related to the increase in debt? Looking ahead will the governments be expanding debt, or just taking over existing debt? If that's the case, does that mean if debt growth is flat, then growth is zero? Ed, you made mention of new debt issuance. Will this be roll over-issuance or new debt?
    • EH
      Edward H. | Real Vision
      29 April 2020 @ 11:01
      Good question. Steve Keen is especially good on this. Here’s a 2016 article he wrote explaining his view https://www.forbes.com/sites/stevekeen/2016/03/27/the-seven-countries-most-vulnerable-to-a-debt-crisis/#1330412ece5a We will have to have him on soon. The concept is that you need a stable or growing growth in private credit to sustain an upturn. When it turns down, eventually you get a recession. Government can’t do anything directly to provide private credit. It can merely replace incomes that sustain credit growth. After a big downturn, we should still expect households and businesses to hunker down to build liquidity buffers after the initial demand shock. And that will cause the effects of the downturn to linger.
  • PH
    Petter H.
    29 April 2020 @ 09:37
    Have not seen Raoul in a while, will he be coming back soon? Would be really interested to hear an update on his idea of liquidation, hope and insolvency. E.g. what are the likelihood of the short term bull market we have seen to be the last wave of a liquidation phase, or is it the hope phase according to him? Does the framework still stand?
    • EH
      Edward H. | Real Vision
      29 April 2020 @ 10:49
      Raoul is slated to do the briefing with Ash on Friday, his Internet connection permitting.
  • PC
    Peter C.
    29 April 2020 @ 09:48
    I didn't read the article because it is behind a firewall but I wonder how Jeremy Warner's bullish scenario accounts for the impact of the crisis on emerging markets? How do you avoid a depression in about 50% of the market (ex JPN, EU, US) where massive fiscal and monetary stimilus is basically impossible or at least less 'unlimited' due to dollar denominated debt and fragile currencies? And how do you deal with the massive oil glut that will likely depress oil prices for a long time and impairs oil-producing nations? Does he really believe that the US, UK and others with fiscal and monetary power will be insulated from a global crisis and continue the 'secular bull market'? I cannot imagine that for some countries the COVID crisis will just be a bump in the road while other will face a deep recession and a much longer recovery.
  • JV
    Jan V.
    29 April 2020 @ 09:41
    I haven’t read the Telegraph article but the great depression can’t be simply explained by a lack of aggregate demand. Inflationary monetary policy of the 1920’s caused a rise in wages and prices. The problems faced by the American economy in the 1930s were linked to fixing of wages and prices. Wages were set too high, resulting in a very high unemployment rate. They didn’t allow a drop in price levels either after the 1929 bust. Some agricultural products were even burned to maintain these high price levels. All of this was done to maintain prices at the pre-1929 boom levels while holding onto the delusion that the dollar had still maintained its value compared to gold. The effects would have been far less disastrous had they revalued the dollar to gold at a market determined price and let wages and prices adjust freely.
  • RA
    Robert A.
    29 April 2020 @ 09:36
    Great discussion as always. Thanks! I wonder if you could cover Oil ETCs. They look on paper to be one of the remaining trading opportunities in this crisis but perhaps all is not as clear as it seems...?
  • ns
    niall s.
    28 April 2020 @ 22:40
    More media hysteria . Numbers do not justify the hysteria they are close to flu . If you guys keep it up we may all commit suicide . Germany recovered from WW 2 , so the world will recover from this despite you two doom mongers.
    • ns
      niall s.
      28 April 2020 @ 22:47
      On a brighter note I see the Vix term structure is about to exit backwardation .
    • TW
      Thomas W.
      28 April 2020 @ 22:52
      Germany had their debt forgiven and it took a long time to recover. It’s not binary, recover or not. How long will it take? and what will the challenges be? are valid questions.
    • SK
      Shiu K.
      28 April 2020 @ 23:29
      yeah, I know right, what's the point of investing or global macro if everyone will be dead soon
    • DB
      Douglas B.
      28 April 2020 @ 23:36
      You're quite the jolly man
    • DS
      David S.
      28 April 2020 @ 23:39
      This is a game changer whether it is the virus or just media hysteria. How long did it take for Europe to recover from WWII? How long did it take the US to recover from the Great Depression? There will be a new normal, but it will not look like the old normal - massive government debt and Congress and the Administration in charge of everything?? The only benefit I can see coming out of this pandemic is we may be able to handle the next pandemic better - bats make up 20% of mammals and they are everywhere. Can you believe that everything is just hysteria and still adapt yourself to the new normal? I cringe when I hear Mr. Harrison saying spring back and Europe will be OK. Europe, especially the Euro, was not OK before the pandemic. How is the pandemic going to help Europe solve its problems? How is it going to help the US solve its problems? It is human nature to use denial as an emotional strategy against the overwhelming. Hope is better as it may lead to a rational plan. As a matter of fact, Faith, Hope and Charity may be the right strategy. DLS
    • WM
      Will M.
      29 April 2020 @ 03:39
      A bit steep Niall, I certainly agree the media are making this all worse but the economic impacts of this event are undeniable.
    • JL
      Joel L.
      29 April 2020 @ 06:13
      Millions of cases, few deaths.. Where is the wide spread testing?
    • SM
      Stephan M.
      29 April 2020 @ 08:09
      In 2017/2018 Germany had about 25.000 deaths from the flu. The flu vaccine given in autumn 2017 dosen't included the Yamagata flu line which caused so many deaths aftnermath. I also got that flu - working for 2 weeks was not passible and it takes 3M to fully recover. Since today we have about 6300 deaths from corona, way less than 2017/18 where no lockdowns made.
  • JC
    John C.
    29 April 2020 @ 07:57
    Good conversation as always. Regarding New York really starting to look like DeBlasio and Cuomo (who is still putting coronavirus patients in nursing homes) were way late in the game in dealing with this pandemic and a root cause of the spread. 30% of US deaths with 3% of the population (!). The way Seattle handled it is in stark comparison to New York. https://www.nationalreview.com/2020/04/blame-bill-de-blasio/amp/?__twitter_impression=true
  • PW
    Paul W.
    28 April 2020 @ 23:03
    Deflationary forces caused by demand destruction will likely last a year or so, as currently reflected in oil and bond prices and dollar strength. Government stimulus will likely relieve some of this pressure without reversing it. Yet in a couple of years will inflationary forces be ascendant? Private sector demand will eventually come back and government monetary and fiscal stimulus will most likely overshoot. Meanwhile the supply side will likely be constrained due to reworking of supply chains, the effect of low prices, government regulation and the resilience versus efficiency debate. Short term deflation and long term inflation seems the most likely outcome of the pandemic.
    • DS
      David S.
      28 April 2020 @ 23:45
      Paul W. - Well said, if everything goes really well. DLS
    • nr
      nicholas r.
      29 April 2020 @ 00:48
      well said my friend
    • SM
      Stephan M.
      29 April 2020 @ 07:46
      Every money printing leads to inflation in some asset classes. Since the 2008 we saw asset inflation in the stock market, real estate, art, vintage cars and some in food while wages stayed nearly flat.
  • IP
    IDA P.
    29 April 2020 @ 06:40
    Can you imagine the clothing industry? if you work from home a few days a week, and never go out, you need much much less clothing...
  • Dd
    Daniel d.
    29 April 2020 @ 02:23
    I think you guys are getting a bit carried away. We are not at war. Worldwide deaths are still lower than a typical flu season. Sweden has had a much lighter lockdown and deaths/million are similar to the rest of the world.
    • LK
      Lauri K.
      29 April 2020 @ 05:27
      You should compare Sweden to it's neighbours, Finland and Norway. The situation in Sweden is a disaster on those terms.
    • GD
      Gerrit D.
      29 April 2020 @ 06:24
      Sweden has the worst possible outcome with their strategy: more casualties and more economic decline than surrounding countries.
  • DS
    David S.
    29 April 2020 @ 05:14
    "Depression with a small 'd' is my base case." Ed! What happened?? Yesterday you were doing so well playing the "reformed bear" only to fall back off the wagon so quickly. Ok, I'll help. Try this: say "Schaufensterbummel" 10x in the morning when you wake, and another 10x before you go to sleep at night.
  • FD
    Fausto D.
    29 April 2020 @ 05:08
    Is it fair to compare Greece to Italy? It's one thing having $200B GDP nation potentially exiting the EuroZone, another having $2.2T GDP nation potentially exiting the EuroZone (personal savings aside!). Fiscal union will never happen, that is the flaming house of cards. Really enjoying your daily discourse.
  • WM
    Will M.
    29 April 2020 @ 03:49
    As a 40 year veteran of the oil patch, let me assure everyone.... we may have $20 oil “today” but as sure as eggs are eggs, we will have $120 oil sooner than you can imagine.
    • UJ
      Ulf J.
      29 April 2020 @ 04:53
  • UJ
    Ulf J.
    29 April 2020 @ 04:29
    Jim Rickards twitter..............New survey shows that of those who received IRS stimulus checks, 38% added to savings, 26% paid off debt, and 18% planned to spend but not yet. As I warned, there's no "stimulus" in the stimulus. Classic liquidity trap.
  • PB
    Paul B.
    28 April 2020 @ 23:56
    We are in Deep Shit here in Australia. The Mortgage Debt is Astronomical & most of it is IO, and the amount of Loans going over to P&I is still very significant. I see Banks here dragging out the Term beyond 30 years and rolling over the P&I back into IO. If they don't do this then the Property Market is going to crash. The slow down in Private Credit is going to crush the Economy any which way you slice it. Aussie's just can't borrow anymore Coin from here.
    • Am
      Alex m.
      29 April 2020 @ 00:13
      "Deep shit" lol
    • JS
      James S.
      29 April 2020 @ 04:14
      Yet the AUD is back above 65c.
  • WM
    Will M.
    29 April 2020 @ 03:46
    Not so sure I agree with the EU coming together........ but pigs might fly....
  • TS
    Tamim S.
    28 April 2020 @ 23:36
    Is that a bible behind Ed?
    • HE
      Henry E.
      29 April 2020 @ 00:11
      Hummmm.... That's an interesting question. Would you have asked the same question if you thought it was the Koran or perhaps Adam Smith's An Inquiry into the Nature and Causes of the Wealth of Nations? Would appreciate your thought process.... Why does it matter?
    • EH
      Edward H. | Real Vision
      29 April 2020 @ 00:22
      It’s the Book of Common Prayer used in the Anglican/Episcopal Church
    • WM
      Will M.
      29 April 2020 @ 03:41
      It could be the life and times of Basil Brush for all I care, I am too busy listening to the commentary........
  • GF
    Gordon F.
    29 April 2020 @ 03:14
    We still don't know what the best tactics are for recovering the economy while keeping the virus from overwhelming the hospitals. I am very glad to see different states taking different approaches, so that we can learn more about what works and what doesn't. Some may say - after the fact - that lives could have been saved if everyone had taken Michigan's approach, or that the economy recovered much faster in Georgia, but for now, we just don't know, and by allowing different states and even cities to try different approaches, I hope we can get some actual data on what works better.
  • RG
    Razmig G.
    29 April 2020 @ 02:54
    Can we please just STOP reporting china's numbers as if being anywhere near legitimate? Thanks!
  • JE
    James E.
    29 April 2020 @ 01:26
    I am pleased you brought up the "perception" scenario. This would probably lead to the population scared into thinking of shortages in food, as the raids on supermarkets in bulk buying has already shown. Politicians harping on about doom and gloom makes people believe the worst. Here in New Zealand we have unfortunately had a rise in suicides, very concerning. Countries need to undergo a full enquiry into the response to this virus. But as always very informative discussion as usual, keep this segment going please.
  • MH
    Martin H.
    29 April 2020 @ 01:07
    The bottom line is that they cannot print wealth. If a depression is in this it will out regardless of what they do, it will simply become an inflationary depression if they throw enough funny money at it. The thirties was a depression, sure they made it longer than needed but to say it was caused by a policy error isn't true.
  • BD
    Ben D.
    29 April 2020 @ 00:48
    What I cant get over is the interview with a very smart guest "Richard Koo" who wrote "Balance sheet recession" what's happening with rates at 0% might end up like how he explained. If RV is able to I would love to hear Richard's opinion on what might happen and what he sees.
    • EH
      Edward H. | Real Vision
      29 April 2020 @ 00:49
      Great idea. We will try to get him on in the next couple of weeks. He is good on the balance sheet recession.
  • DS
    David S.
    29 April 2020 @ 00:38
    Well done. I know it is difficult to get this together each day. Looking at the similar levels of an index leads to fallacy of composition problems. Both of you have spoken about this, but it might be informative for viewers to see some changes in composition like Amazon over time. DLS
  • AD
    Adrian D.
    28 April 2020 @ 23:30
    Thank you again Ash and Ed, I have been following your work from the beginning, this evenings daily briefing was the most important one to date.
    • AB
      Ash B. | Real Vision
      29 April 2020 @ 00:26
      Thanks, Adrian. It’s much appreciated.
  • ZF
    Zach F.
    29 April 2020 @ 00:25
    Great show today! Thank you :)
  • SM
    Shantanu M.
    28 April 2020 @ 23:45
    Since these daily briefings don't have transcripts any chance you guys could summarize it in 3-5 bullet points under written summary? That way if its something interesting I can look up that part of the video, otherwise a lot of the stuff in daily briefings becomes information overload.
    • SM
      Shantanu M.
      28 April 2020 @ 23:48
      NVM I just saw that older videos do have transcripts. So i guess this will get one too sometime later.
    • MW
      Max W. | Real Vision
      29 April 2020 @ 00:10
      The video is sent out to be transcribed once it is finalized at around 6PM EST. The transcript is usually returned and up on the site in less than 12 hours.
  • MT
    Mark T.
    28 April 2020 @ 22:56
    Based on the data I've seen and heard epidemiologists talk about, if I were over age 60 or had serious underlying health issues, I wouldn't leave quarantine. If I wasn't in this group, I'd be fine with everything opening up again.
    • DS
      David S.
      29 April 2020 @ 00:00
      I am in the high-risk group, so I will follow your advice. Everyone wants to be open. Opening poorly - tattoo parlors?? - leads to COVID-19 stalking the land until everyone is vaccinated. It will be a little like Russian Roulette for all ages. The gun will just have a different number of bullets in it. DLS
  • OO
    Oliver O.
    28 April 2020 @ 23:18
    Hi Guys, Wondering what your take is of the corona crisis on the Canadian economy. With world leading household debt, housing bubbles and low oil prices, what options does the BOC have other than to print money? Obviously this would have a significant impact on the CAD vs USD but are there any other spillover effects? Thanks
  • DC
    D C.
    28 April 2020 @ 22:45
    Buy the lockdown, sell the re-opening?