Chris’ note: The Daily Cut AM is a free resource for all Legacy Research subscribers. It brings you our best insights on the coronavirus pandemic and its impact on your health and wealth.
The mass media is doing a huge disservice by spreading fear based on worst-case scenarios. That’s why, today, you’ll hear from our tech expert here at Legacy, Jeff Brown.
Jeff has more than 25 years’ experience in the tech sector. And as he’s been telling readers of his free Bleeding Edge tech investing e-letter (sign-up here), things are not as bleak as they might seem from press reports.
As Jeff reveals below, we’re racing toward getting the virus under control. And one novel approach is “crowdsourcing” a cure…
Now over to Jeff…
What’s going on in the stock market right now is a once-in-a-lifetime event.
For instance, we’ve seen the fastest fall into a bear market in history. And the CBOE Volatility Index (VIX), the stock market’s “fear gauge,” is the highest it’s been since October 2008.
That’s how rare it is.
But remember… computers running algorithms heavily “control” the stock market. These algorithms sell stocks based on certain volatility and momentum metrics.
This results in the kind of stock market action we’ve seen over the last two weeks.
The good news is that it comes to an end. The same algorithms selling right now also recognize when stocks are undervalued. That’s when buyers pile in.
It’s painful to watch. But I believe it’s overdone. Consider the following positive developments…
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New confirmed cases have leveled off in China. Just today, China reported no new locally transmitted coronavirus cases. Social distancing helps stop the spread of COVID-19.
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The number of new cases reported in South Korea has been decreasing daily since it peaked on February 29. This is largely due to the large-scale testing implemented there, which helped curb the spread of the illness.
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Research out of China shows that warmer, more humid weather slows down the spread of COVID-19. Cases in the northern hemisphere will dramatically fall as we enter spring (humidity) and early summer (warmer weather).
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Electronic supply-chain manufacturers in China are on track to return to full production by the end of this month.
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In China, shipment transportation to airports and seaports for logistics is almost back to normal.
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Foxconn, the world’s largest contract manufacturer, stated that supplies to its China, Vietnam, and Taiwan manufacturing plants have returned to normal ahead of schedule. Apple is Foxconn’s largest customer.
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Ascletis, a Chinese biotechnology company, has already shown early success with the combination of its Hepatitis C and HIV treatment for COVID-19. Early data from a clinical trial on 11 patients showed that all 11 have recovered and been discharged from hospital.
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Another China-based biotech company, Hisun Pharma, has been testing its influenza drug. Early tests show that patients are clear of the virus in just four days.
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U.S. biotech firm Moderna has begun testing its synthetic RNA vaccine for safety.
The mainstream media is doing you a disservice by spreading fear based on worst-case scenarios that have no real substance.
But I’m looking at the data. And there’s plenty to be thankful for.
In fact, as you’ll see today, there is a lot for us to be optimistic about.
Chances are you’ve never heard of a software program called Foldit.
Foldit is an online video game. It challenges players to fold proteins into shapes that are stable and functional.
It started as a research project at the University of Washington’s Center for Game Science and Department of Biochemistry. It launched publicly in 2008. Since then, half a million people have played the game.
Here’s a visual…
Source: Foldit
Proteins are chains of amino acids. They are responsible for every function a living organism’s body performs.
The way a protein is folded speaks directly to its effectiveness. Properly folded proteins do the job they are designed to do. Those that are misfolded can cause disease.
This is a complex topic. Understanding protein structures is one of the biggest challenges facing the world’s top biologists. But understanding the 3D structure of a protein associated with a virus like COVID-19 can help us discover a cure… or a therapy to fight against it.
Foldit is leveraging the “wisdom of the crowd” to find a solution.
It just launched its “coronavirus puzzle.” In this challenge, players are trying to design proteins that can bind to the COVID-19 virus in a way that stops it from spreading in the human body.
This is important because COVID-19 is a new type of coronavirus. If a Foldit player can “crack the code”… and design the right protein structure… scientists could use it to make a cure.
This game is open to anyone. Players don’t need a medical background. This allows for out-of-the-box thinking.
Now, I know that sounds counterintuitive.
Shouldn’t biologists, virologists, and epidemiologists handle this problem?
To answer that question, we need only look back to the Human Genome Project. Funded by the National Institutes of Health (NIH), the project set out to map the human genome in 1990.
At first, only a core group of experts worked on the project. They came up with a solution that could sequence the genome in four hours with 70% accuracy.
Then the project was opened up to Harvard Medical School. It was able to sequence the genome in an hour with nearly 80% accuracy.
Finally, the project was opened up to the “crowd.” By putting the best crowdsourced solutions together, the project could sequence the genome in 10 seconds with more than 80% accuracy.
Simply put, the crowd provides different ways of looking at the same problem. With the right skills and a little bit of luck, there’s a great chance we can crowdsource a cure to COVID-19. I’m excited to see what progress is made.
Over the weekend, the Trump administration announced that Verily, Google’s life sciences division, is developing a website to help people who may have been exposed to COVID-19.
It’s called Project Baseline. And it will be a public-private partnership between Google and the U.S. government.
The website will allow folks to register and go through a flow chart of questions to determine whether they should seek testing for COVID-19.
If the answer is yes, the site will direct them to a local testing center. If the test comes back positive, the site will help folks sign up for clinical trials for a treatment being developed.
Google plans to launch the site in the Bay Area this week. It will test it… fix the bugs… then roll it out across the country. Apparently, about 1,700 Google engineers have volunteered to work on expediting the project.
Google is following the old Silicon Valley playbook – launch immediately in the Bay Area, optimize, and then roll out everywhere else.
This is a great idea. The press criticized the Trump administration about this partnership, even going so far as to say that it isn’t true.
But Google has stated clearly that it is working hand in hand with the U.S. government and plans on rolling out Project Baseline nationwide.
Politics aside, this is a fantastic development. Government agencies can be slow to act. So working with the private sector is great for everyone. A company like Google can get a functional website up and running in days, test its system quickly, and then expand nationwide.
The mainstream media needs to report on all of the positive progress being made… rather than doing its best to instil fear and negativity.
Chris here – As I told you when we created this free coronavirus-crisis resource – The Daily Cut AM – we’re putting together a “community center” for you and your fellow readers.
This is where you can get your urgent questions answered by our team of analysts.
I’ll get to as many of them as I can and we’ll publish answers from Bill Bonner, Doug Casey, Teeka Tiwari, Jeff Brown, E.B. Tucker, Jason Bodner, Dan Denning, Nick Giambruno, Tom Dyson, and Dave Forest… and the rest of the Legacy Research team.
And if you have a personal story to share about how you’re coping with the virus… or how you and your family are staying safe… send it on.
We’re also interested in local updates on quarantines in your area… the state of the economy… or the response by the feds. Don’t be shy. Let us and your fellow readers know.
As I’ve been saying since we started writing The Daily Cut AM, we’ll get through this crisis together. We want a real alternative to the fearmongering in the mainstream news. We want your stories.
So start sending your questions and stories my way. You can reach me and the Daily Cut AM team at [email protected].
Now, on to today’s batch of reader emails. We’re getting a lot of questions about our top recommended form of “disaster insurance” – gold…
Can someone explain what is going on with gold and silver? They are usually a safe haven. Sellers of bullion and bars are reporting zero inventories and delays in production. So with such demand, why are prices falling?
– Jim S.
And to provide an answer… I turned to colleague Tom Dyson.
Tom, as you may already know, recently made an all-in bet on gold. And he’s been writing about his big call on an almost daily basis over at his free Postcards from the Fringe e-letter (sign up for free here).
I wrote an entire essay on this on Tuesday. But the short answer is the price of gold is not set by buyers and sellers of physical gold. It’s set by the big institutions, banks, hedge funds, and commercial traders trading futures, options, leases, and other forms of “notional” or “paper” gold.
I’ve read the daily transaction volume of paper gold is 1000x times the daily transaction volume of physical gold.
So when these commercial traders answer margin calls… and unwind hedges… they sell their gold. That’s why the price can take big dumps sometimes. The only thing you can do is expect and accept the volatility.
Oh, and by the way… we’re in the ninth inning of the greatest monetary experiment in financial history. We’re also on the cusp of a new monetary system. It’s not surprising there’s a little volatility in the gold price.
Sit tight. Ignore it. And keep an eye on the fundamentals, not the wild fluctuations in the crazy paper gold market.
Now, on to some updates from your fellow readers about their personal situation as coronavirus infections mount in the U.S.
We’ll start with an email sent in by one of the many brave men and women doing front-line medical work…
As a nurse, I go to the hospital and I get pulled to the infection prevention department. I’m tracking patients who need COVID-19 tests and those waiting in isolation who have been tested.
The full-time infection nurses have been on call 24/7 for weeks… and they are tired. Then we all still have to go home to take care of our families… and find toilet paper in the empty stores.
We wash our hands and try to keep safe. It is very stressful… but we always get it done.
Thank you for all the open and honest communication about what is going on. As a nurse, I have more knowledge than a lot of your readers about this virus and how we treat it and practice infection control. But it is scary the way people have responded to this event. Our media have become so corrupt, they lie about something as dangerous as this virus. The healthcare workers know how to deal with it. But we could do without all this hysteria.
– Cindy S.
Thanks for writing in, Cindy. Thank you for the work you and your colleagues are doing to keep us safe. And please, keep the emails coming. We’d love to hear more about your experiences on the front lines. Best of luck and stay safe…
And Cindy isn’t the only one fed up with the way the mainstream media is handling the situation…
I am almost 75. I can beat 90% of 40-year olds. How do I stay safe? I keep my immune system strong. And I don’t listen to all the bulls**t in the news. How sad that the population is so utterly stupid in our country. Unfortunately, the inept are showing their true colors. So very sad.
– Hans S.
Although I’m not a hard-core prepper living in an abandoned mineshaft in an undisclosed location, I have been making preps for this type of situation for many years…
To wit, my wife and I have at least a years’ worth of food stashed, plenty of water, multiple filtration systems (since a decent-sized lake is a one-minute walk away), and alternative medicines, as well as a full “field surgery” kit, alternative power (solar + generator), enough firearms and ammo to arm the neighborhood if necessary, and shortwave comms, if required.
My vehicle is a 2001 Suburban 4×4 “King of the Road” in like-new condition, with an 8.1 litre engine and 39-gallon tank that I always keep full, giving us a 500-600-mile range, depending on terrain.
All this was done not at the last minute and driven by panic and fear. It was completed over years, using simple observations of a degrading society populated by ill-educated zombies, and common sense in recognizing the pitfalls of normalcy bias and the idiots running the government. We’re good here.
– Jef G.
Remember, we want to hear from you. What are you doing to prepare for the outbreak? Do you have any local updates from your area? Are there resources you want to share with your fellow readers?
And what burning questions do you have for your favorite Legacy analysts? Send them to me and the Daily Cut AM team at [email protected].
I (Chris) am Irish. And I just had the bleakest St. Patrick’s Day of my life…
Paddy’s Day – as we call it – is on March 17. It’s a public holiday in Ireland. Businesses close. Everyone celebrates by going to their local parade – there’s one in every city, town, and village in the country. Or they go to the pub…
But this year… nobody was celebrating. Parades around the world were cancelled. Even in Ireland, the parades were called off. And the pubs were closed.
It’s almost unimaginable to me that the Irish wouldn’t celebrate their national day. If you’ve ever been to a Paddy’s Day parade, it’s almost an obligation for Irish people to celebrate… drink… and be merry.
This year, I spent my Paddy’s Day traveling back to Dublin, Ireland from Barcelona, Spain, where I had been visiting friends and family.
I had been staying with my aunt and uncle. But they’re in their 60s and 70s. So, after the Spanish government declared a state of emergency over the virus, I moved to a hotel.
That worked for all of one day. After spending just one night there, I got a note under my door telling me all the hotels in the city were closing… and I needed to get out of the country.
I’m glad I did. Spain now has the fourth-highest number of deaths from the coronavirus to date.
The city is in lockdown. Cops in facemasks patrol the streets to make sure nobody is breaking curfew. People are trapped in their houses.
For instance, the cops stopped a friend and his three-year-old daughter from taking a walk on the city’s beach. Only essential travel is allowed.
Here’s what Barcelona’s usually bustling airport looked like the night I flew back to Dublin…
Barcelona Airport at 8 p.m. on March 17
I made it to Dublin.
Then I picked up a car… and hightailed it to a bolthole in the Irish countryside. The Irish government says I need to self-isolate for two weeks.
So, I’m writing to you from near Piltown, County Kilkenny. This is where I’ll be holed up for the next while…
Your editor’s bolthole in County Kilkenny
The view from my writing desk
Ireland has 366 cases. So far, two people have died.
But people are jittery. They know the storm is coming. Our doctors and nurses are bracing for what’s to come…
The eye of the storm has reached Italy. And it’s bad…
Yesterday, the country recorded its highest daily death toll from the coronavirus.
475 people died. This brings the death toll there to nearly 3,000.
That compares with 3,245 in China… 1,284 in Iran… and 767 in Spain.
One reason Italians are dying in higher numbers than elsewhere is it has one of the world’s oldest populations. About 23% of Italy’s population is 65 or older.
And from the reports I’m reading, Bergamo, a city in northern Italy, has been hardest hit. There, 4,305 people have contracted the virus… and 93 of them have died. Morgues and crematoriums there are not able to cope.
This is what U.S. hospitals are facing.
One big problem is U.S. hospitals are either out of… or short of… essential kit to treat people with coronavirus.
For example, CNN Health reported this morning that many hospital employees are making their own face masks or sometimes using them twice. And in southwest Georgia, Phoebe Putney Health System used six months’ worth of supplies in less than a week.
We already know this virus is more dangerous for older folks, and those with underlying health issues.
But a key issue facing elderly Americans, in particular, is that diabetes and obesity are “risk factors.” That’s doctor-speak for, “They lead to higher death rates.”
27% of Americans over the age of 65 have diabetes. And 43% of Americans over 60 are obese. There’s a lot of crossover between these two groups. But this is a real worry.
That’s why my advice to you is to self-isolate… like I’m doing. About 80% of cases only bring mild symptoms. But if you’re in a risk category… or if someone close to you is… you can’t take any chances.
Don’t get me wrong… it’s not all bad news.
For the first time, there were no new cases of COVID-19 in Hubei province in central China. That’s where the coronavirus outbreak began in the city of Wuhan.
And there’s evidence that two drugs that are already approved are winning the battle against the virus.
Take Actemra. It’s an anti-inflammatory drug used to treat arthritis. But doctors in Italy and China say it’s having a huge impact. It turns out that the protein IL-6 that causes arthritis in your joints is the same protein that damages your lungs if you get coronavirus. And Actemra “turns off” this protein, leading to much less severe inflammation in the lung.
So far, fifty people in Italy and China have had successful treatments for the coronavirus with Actemra. The official results of the trials haven’t been published yet. But the word among medics is that Actemra is working… and it’s saving lives.
Meanwhile, Chinese scientists have conducted 22 separate placebo-controlled trials on a malaria drug called hydroxychloroquine. They reveal that the drug is effective at killing the COVID-19 virus.
It’ll take a month or so to confirm the data. But once that happens, the doctors have another weapon they can use to save lives. If you’d like to find out more about these treatments, read on here and here.
And remember, The Daily Cut AM is a shared resource for all Legacy readers. These are trying times. And the way we’ll get through this is together.
So please share your stories of how you’re coping… along with any local updates… at [email protected]. We’ll publish as many of your emails in future dispatches as we can.
That’s all from the The Daily Cut AM team for now. But I’ll be back with you later for our regular Daily Cut send.
Regards,
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Chris Lowe
March 19, 2020
County Kilkenny, Ireland
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