Blue Wave, Lockdowns, Israel and Libya

٣ نوفمبر ٢٠٢٠

Yesterday can be called the calm before the storm. At the very least, there were no particular reasons for the recovery that were observed across the entire spectrum of financial markets. Europe is closing more and more. Austria, Spain, Italy, Greece, Belgium and other countries have already joined France, Great Britain, Germany, Ireland or are at the stage of accession. The obvious candidate for joining this list is the United States, which last week reached a new all-time high of 100K new cases per day (Anthony Fauci's prophecy came true).

Looking at all this, we would like to discuss the case of Israel, which introduced the lockdown on September 25th. No one understood why Israel went to the second murder of the economy. But the fact is that if at the time of the lockdown start the number of new cases per day exceeded 10K, then just in a month it dropped to 500 cases per day, that is, 20 (!) times less.

So, Israel is a clear illustration of how everyone should have acted a month ago, and also why further lockdowns are inevitable. Today, despite all the optimism of vaccine manufacturers, lockdowns are the only way to bring the pandemic under control.

We have written about the economic consequences of lockdowns more than once. Let's just note that yesterday's growth in oil prices is a reason for buying and nothing more. Especially considering the latest news from Libya. In just 3 weeks, the country was able to increase production from 100K b / d to 800K b / d and is not going to stop there for now.

As for today, its main event, without a doubt, is the US elections. Judging by the polls, the analysis of bookmaker bets and the modeling results, the so-called "blue wave" is coming, that is, the Democrats have every chance to take control of not only the White House and the House of Representatives, but even the Senate. And this means tectonic shifts in everything. So, “2020” is unlikely to stop in the foreseeable future.