The presence of the coronavirus is not what sent financial markets reeling.
Up until last Sunday evening, the markets looked poised to handle the outbreak quite well, in fact, and the sell-offs that had happened were orderly and functional. Market sentiment had become fairly optimistic despite the recent volatility. It was the surprise government policy decision to shut down commerce broadly and wipe out most of our GDP that tanked US markets.
Until that point, the markets were exhibiting the exact same sort of behavior they have during past epidemic situations, which involved short-term volatility with the widespread expectation that things would revert to normal.
Western democracies have actually responded to the coronavirus with more authoritarian policy than China did. American citizens and businesses have never been treated this way in our nation’s history. And our economic contraction will be deeper than what China experienced because of it.
The only market participants who saw this crash coming, evidently, were senators and those married to sitting senators. These senators dumped all of their investments, clearly told their family members to dump their investments, and then purchased stocks that favored a shelter-in-place society. As much as they bloviate about “treason,” it’s pretty clear they see the financial devastation of their fellow citizens as a profit center. They are absolutely disgusting human beings – sociopaths, really:
This week, ProPublica and the Daily Beast reported that members of Congress sold equities after receiving briefings on the dangers of the novel coronavirus. The sales came before a global financial panic slashed stock prices around the world, and before the American public was broadly cognizant of the scale and danger of the virus.
Senator Richard Burr, the chairman of the Senate Intelligence Committee, sold off what looks like a large share of his personal holdings the day before Valentine’s Day, picking up between $628,000 and $1.72 million in cash. Roughly a week later, the market tanked. And Senator Kelly Loeffler, whose husband is the chairman of the New York Stock Exchange, began selling equities on January 24, the day of an all-Senate briefing from officials including Anthony Fauci of the National Institute of Allergy and Infectious Diseases. Through mid-February, her household dumped dozens of stocks and bought shares in Citrix, which makes teleworking software.
This means they knew weeks in advance that western governments were expecting to enact unprecedented orders that would send the country into an immediate economic depression and put millions out of work. That’s the particular edge they had in information that normal traders did not. Those on the Senate Intelligence Committee have probably been getting briefings from the intelligence community on the “real” experience in other countries, not the one that plays out in a deranged mainstream media here. Burr was receiving daily briefings on the pandemic.
I am sure these are not the only policymakers who behaved this way, either, they are just the ones the media wants to single out.
Sen. Richard Burr (R-NC) was one of only three members of the United States Senate to oppose bipartisan legislation in 2012 barring lawmakers from using non-public information to reap profits on the stock market.
Burr, who at the time had just been reelected to his second term representing North Carolina in Congress, opposed the STOCK Act on the basis that there were already existing laws in place to address insider trading. The fact that existing laws were rarely used to punish members of Congress for insider trading, despite their being plenty of evidence such dealings took place, seemed not to the bother the senator.
“We’re doing this at a time when we should be talking about the economy and jobs,” the senator told North Carolina reporters shortly after voting against the bill. “Why do the (American people) think so little of us? Because we’re not even debating the things that are most important to them.”
At the time of Burr’s vote, the STOCK Act was widely popular with political figures on both the left and the right. It not only garnered the endorsement of President Barack Obama but also staunch Tea Party conservative then-Senator Jeff Sessions.
Our government did NOTHING to prepare corporations or small businesses for this decision in advance. They could have, but they didn’t. The chairman of the New York Stock Exchange obviously knew this was coming, and did not take any action to prepare the financial markets. He engaged in insider trading instead.
It’s a good thing our government is taking extreme measures to provide fiscal stimulus to ordinary Americans. But this garbage is not going to end until these people experience serious personal financial and legal accountability. And hopefully Dangerous Liaisons-style public humiliation.