E Market Briefing For Monday, July 20

I hearken back to the huge increase in bank loan-loss provisions; as supportive for Jamie Dimon's concerns about economic catharsis 'even if' we open the economy fully. Sort of what if you gave a performance and nobody came? (And I wasn't just thinking of political rallies, which is true too; but that's almost a distraction given the very real life-altering challenges so many are dealing with; here and abroad.)   

Executive summary:

  • Congress and the Fed have to stand-ready to provide sufficient funding for workers and the unemployed to get us to the hoped-for optimism this Fall; it's my preliminary view that even if they do the economic situation will struggle, so the view of valuations might be that they're high outside of Covid-era beneficiaries;
  • Markets and the economy will reopen dramatically and rapidly if we get the type of backdrop that too many governors and some in Washington were in a sense properly wishing for, but failing to realize as an 'aspirational view'; but for now it is dicey at best, and pretty grim at worst.
  • Meanwhile the disconnect between rotating between the 'broad list' and the 'super-caps' misses another trend; there's a distinct hot Bull Market going on;
  • Biotechs are in a world of their own; rallying strongly early in the year; plunging as well during the February / March 'cratering' into 'The Inger Bottom' (my term that very day in-hopes history would reflect that March 23rd 'max-panic' fear); and of course rallying; but in phases ever since; with some breaking-out now;
  • We'll focus again on biotechs; because that's what's fueling NASDAQ, and with the grim 'bombshell news' out of Iran today, admitting that 25 million citizens of their country are infected with Covid-19 (almost everyone in Tehran??); well, it's so idiotically political here, as this is an evolving global catastrophe begging for medical help, not nonsensical debates 'as if' there isn't enough blame around;
  • That matters because they generally sold-off when the first Moderna story came out; but not so much now, as investors recognize that it may not be optimal for one vaccine; and that there are other treatments that may be complementary (in fact there's concern Moderna's has longevity; requiring booster inoculations; or a complimentary vaccine or immune T-cell booster shot to elicit a better-response by the body (especially in the elderly) beyond more neutralizing antibodies;
  •  Hence a lot of biotechs related to vaccines or treatments have bounced; tend to continue this rotating (high volume series of swings; generally in uptrends); I'm sure there are more, but both Sorrento and Heat Biologics are plays in this field; but both are extremely volatile with more 'in the oven' but 'not fully baked' (there may be news on both of these, which I touch-on in the long main video);
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