Blain’s Morning Porridge, July 20 2020 – Time of the Comet?
“When beggars die, there are no comets seen; the heavens themselves blaze forth the death of princes.”
Forget the markets… Have you seen the Comet?
Worry not about the EU failing to agree a deal over a long weekend negotiating – but agreeing to talk more about it later today. Fret not about how last week’s strong US bank earnings might be anaesthetising us to worse numbers from US industry still to come. Don’t stress about the deepening China vs World standoff, or how China’s Ambassador strenuously claims the manacled prisoners were on their way out for nice day by the seaside. Have no concerns about how the US equity market seems unable to breach key phycological levels. Be calm about the absolute lack of market conviction. And don’t give a fig for rising Coronavirus hotspots or the US Dr Fauci being “a bit alarmist”.. I know who I would trust between Trump or the good doctor.
I shall return to markets later – much later – but for now I most strongly suggest get up very early tomorrow morning (about 2 am) and focus on the Northern Sky. It will reward you.
Comet Neowise is spectacular – you can find it bottom right of the Plough/Great Bear/Big Dipper, the familiar saucepan of stars (which, actually, is just part a proper constellation: Ursa Major). The seeing isn’t great as its close to the horizon, so you need dark skies.
I’ve always wanted to see a Comet. An early star-gazing memory was looking upwards for Comet Kahoutek with dad in the early 1970s on a freezing Scottish hillside – and dimly discerning something like a fuzzy ball in his binoculars. I must have caught the bug – I now own telescope(s) and get really boring about nebula. On Friday night She-who-is-Mrs-Blain and I were night sailing across Lyme Bay on the South Coast of England about 30 miles offshore when the cloud cleared and we saw it.
In the Dark Sky, the Comet was everything I’d hoped for. Observing a Comet from a rolling boat was “challenging”, but well worth it. The tail stretches as long as my raised finger at the end of an outstretched arm, which is millions of miles in real space. (The moon is smaller than your thumbnail on the same basis!)
Comets have a bad reputation.
The Chinese have kept records of “Venomous” stars for thousands of years, and, interestingly, they do seem to coincide with times of plague, storm, pestilence, war and famine. A Comet foretold Caesar’s assassination, and “carried him to heaven” according to Augustus. A Comet appears on the Bayeux tapestry celebrating the Norman conquest. The great fire of London? Choose between Carol Baskin, Catholics or a “hairy star”. My money is on the Comet.
Comets are peculiar beasts. Some have predictable elliptical orbits – Haley’s Comet makes a regular appearance every 76 years. Other’s appear randomly, perhaps spending aeons in the Oort cloud way out beyond Pluto before some chance gravitational event slingshots them around the sun on million-year orbits.
The tail we see from earth is the comet spewing water and gas as it heats up as it approaches the sun. During the 1910 Haley’s visitation snake oil salesmen made fortunes selling face masks and patent cures to protect us from the effects of passing through the comet’s tail. Meteor showers, like the Perseids in August, are caused by the Earth passing through comet debris.
Astrologers got very excited about Comets. They would analyse the shape and colour of the comet to determine what it meant. If it’s red; then it means war. If its grey it’s the same colour as Saturn, therefore means plague, famine and disaster. If it’s whiter, it’s associated with Jupiter, meaning a crisis in law and leadership, and political strife. The word Comet is a derivation from the Greek word for hair – the shape of some comets’ tails apparently looks like mourning women.
I looked very carefully at the Comet for clues on what this one presages. Let me see… in my peripheral vision – a good way to look at stars – it almost looked to have two heads. The tail looked bright and granular, but also dirty and grey. The hair was long, but slightly kinked to the right – like the wailing chorus from a Greek tragedy tearing her hair out. Was there a hint of red?
What does it all mean? The gods are trying to tell us something…
What potential disaster does the Comet foretell. On the basis some people believe in Chartism, clearly the Comet could be an equally reliable indicator? Therefore….
My read on the comet is we most definitely face a twin crisis of Saturnian and Jovian proportions, with an additional threat of war. We already have the plague (Saturn), rising discontent (Jupiter), a new cold war is erupting, and the fact the comet kinks to the Right is clearly bad news for Donald Trump as his hair wafts to the right.. (Or is it that bad news for us is good news for Trump?)
But seriously…. It’s interesting the brightest Comet in decades turns up in the middle of the Coronavirus crisis. Chance or something more spooky?
I’m trying to figure out what the most likely market disasters the comet might be foretelling:
· A breakdown in confidence on central bank ‘puts’ supporting the market indefinitely?
· Second Wave Covid creating long-term, socially destabilising unemployment and populist politics?
· The end of the Trump era or his getting a second term?
· A European Banking crisis – which will probably happen Comet or no Comet.
· A collapse in savings as pensioners realise their hard-saved pension pots are worth little?
· Comet particles trigger a wake-up-and-smell-the-coffee moment for Tesla, triggering massive sell off…
Who knows… Normal service will resume at some point….
Five Things to Read This Morning:
Lots of great stuff this morning… how will poor unprepared nations cope with Covid, how long before markets shrug off another disappointing European story, if Tesla is setting the tone for the markets then we really are in trouble, and some common sense on the virus from El-Erian:
FT – The Pandemic is gaining momentum: Africa prepares for surge in infections
FT – Global stock stutter as EU recovery fund talks stall
WSJ – A Powerful force – Tesla’s Momentum Leads Stock Market Surge
WSJ – Blackrock Profits Jumps 21% as Investors Surge Into Bond Funds
Bberg – US Must Do Better on its Second Covid Test
Finally… Check out this story about spending lockdown in Bermuda. It’s tempting. I was chatting to a client last week about going back to the office – we agreed it’s got to happen, but when? I’m in no rush – the thought of social distancing being “administrated” on a packed train means certain delay and frustration – but the absence of office banter, and “broker-ear” (the ability to overhear every conversation to understand what’s happening in the market), is important.
Out of time and back to the day job!