Stockman: Coronavirus Will Crash Stock Market, ‘The Jig Is Up’

RUSH TRANSCRIPT CAVUTO In ░░░░░░░░ meantime we have former ░░░░░░░░ budget director David Stockman ░░░░░░░░ He s not convinced ░░░░░░░░ market comeback today is ░░░░░░░░ of anything more than ░░░░░░░░ a bit of a ░░░░░░░░ from some passion we ░░░░░░░░ seen this You re ░░░░░░░░ worried right David That ░░░░░░░░ the gist of it ░░░░░░░░ Yeah I think this ░░░░░░░░ a dead cat bounce ░░░░░░░░ jig is up You ░░░░░░░░ we ve had a ░░░░░░░░ recovery for ten years ░░░░░░░░ by massive increases in ░░░░░░░░ We didn t learn ░░░░░░░░ lessons in 2008 In ░░░░░░░░ the debt total public ░░░░░░░░ private then was 43 ░░░░░░░░ it s now 75 ░░░░░░░░ We re up 45 ░░░░░░░░ s what s fueled ░░░░░░░░ recovery The Fed has ░░░░░░░░ out to lunch crazy ░░░░░░░░ easy money and you ░░░░░░░░ the massive expansion of ░░░░░░░░ balance sheet modernization of ░░░░░░░░ debt CAVUTO But of ░░░░░░░░ we ve climbed through ░░░░░░░░ of escalating debt long ░░░░░░░░ the financial crisis and ░░░░░░░░ right STOCKMAN Yeah But ░░░░░░░░ here s the issue ░░░░░░░░ it leaves the economy ░░░░░░░░ fragile There is no ░░░░░░░░ absorbers in this economy ░░░░░░░░ s a hand to ░░░░░░░░ just in time debt ░░░░░░░░ system that can t ░░░░░░░░ know absorb any interruption ░░░░░░░░ cash flow And what ░░░░░░░░ 19 really is is ░░░░░░░░ massive shock to the ░░░░░░░░ chain of the world ░░░░░░░░ so much stuff circulates ░░░░░░░░ components and parts and ░░░░░░░░ materials intermediate material And ░░░░░░░░ shock to the supply ░░░░░░░░ is really what s ░░░░░░░░ to disrupt the entire ░░░░░░░░ The only way you ░░░░░░░░ COVID 19 and it ░░░░░░░░ coming here there s ░░░░░░░░ doubt about it is ░░░░░░░░ essentially separate workers from ░░░░░░░░ jobs consumers from the ░░░░░░░░ diners from the restaurants ░░░░░░░░ from the airlines and ░░░░░░░░ and resorts and so ░░░░░░░░ And that will bring ░░░░░░░░ economy to a screeching ░░░░░░░░ very quickly and CAVUTO ░░░░░░░░ it hasn t yet ░░░░░░░░ hasn t yet Are ░░░░░░░░ saying that it has ░░░░░░░░ go on a while ░░░░░░░░ have the impact STOCKMAN ░░░░░░░░ yeah It takes the ░░░░░░░░ chain of the world ░░░░░░░░ a few months But ░░░░░░░░ s signs of it ░░░░░░░░ CAVUTO So it s ░░░░░░░░ like a hurricane I ░░░░░░░░ sorry to jump on ░░░░░░░░ but it s not ░░░░░░░░ a hurricane to you ░░░░░░░░ all that stuff is ░░░░░░░░ delayed the hurricane threat ░░░░░░░░ and people come back ░░░░░░░░ doing their thing STOCKMAN ░░░░░░░░ I mean this is ░░░░░░░░ to hit and it ░░░░░░░░ last for months And ░░░░░░░░ problem is the cash ░░░░░░░░ interruptions You know 75 ░░░░░░░░ households in America have ░░░░░░░░ substantial cash Many people ░░░░░░░░ going to be laid ░░░░░░░░ They don t they ░░░░░░░░ t be paid while ░░░░░░░░ re laid off You ░░░░░░░░ a lot of companies ░░░░░░░░ living hand to mouth ░░░░░░░░ we ve got 16 ░░░░░░░░ of debt on business ░░░░░░░░ compared to 10 trillion ░░░░░░░░ They re handling that ░░░░░░░░ okay And with the ░░░░░░░░ rates you could make ░░░░░░░░ argument they ll be ░░░░░░░░ to continue to handling ░░░░░░░░ okay You don t ░░░░░░░░ that STOCKMAN I don ░░░░░░░░ buy that at all ░░░░░░░░ can handle it okay ░░░░░░░░ long as we keep ░░░░░░░░ forward without any shocks ░░░░░░░░ the system or interruptions ░░░░░░░░ what we re having ░░░░░░░░ now is a huge ░░░░░░░░ to the system and ░░░░░░░░ s just beginning to ░░░░░░░░ these shores and our ░░░░░░░░ production process here But ░░░░░░░░ know we ve had ░░░░░░░░ few COVID 19 cases ░░░░░░░░ nobody s been tested ░░░░░░░░ they re unleashing the ░░░░░░░░ The number of cases ░░░░░░░░ going to soar Of ░░░░░░░░ is going to cause ░░░░░░░░ among the public You ░░░░░░░░ going to see runs ░░░░░░░░ the store shelves and ░░░░░░░░ else This thing moves ░░░░░░░░ quickly in the real ░░░░░░░░ that the governments and ░░░░░░░░ you know the central ░░░░░░░░ central authorities can t ░░░░░░░░ much about it Uh ░░░░░░░░ call it you know ░░░░░░░░ neutron bomb of Economics ░░░░░░░░ bomb kills everybody in ░░░░░░░░ radius leaves the buildings ░░░░░░░░ This is the case ░░░░░░░░ 98 of people infected ░░░░░░░░ but it is so ░░░░░░░░ it s spread so ░░░░░░░░ wily that you re ░░░░░░░░ are rapidly that you ░░░░░░░░ have to shut down ░░░░░░░░ economy to stop it ░░░░░░░░ this is an economy ░░░░░░░░ really can t afford ░░░░░░░░ have that kind of ░░░░░░░░ that kind of interruption ░░░░░░░░ Okey dokey It worked ░░░░░░░░ m not going to ░░░░░░░░ lunch so thank you ░░░░░░░░ that Laughter All right ░░░░░░░░ Inquiring minds want to ░░░░░░░░ how everyone feels We ░░░░░░░░ where you re coming ░░░░░░░░ There are many people ░░░░░░░░ will disagree We are ░░░░░░░░ at that In the ░░░░░░░░ a news item just ░░░░░░░░ in here courtesy of ░░░░░░░░ AP that says U ░░░░░░░░ Senator Amy Klobuchar is ░░░░░░░░ her bid for the ░░░░░░░░ nomination Shety not score ░░░░░░░░ in South Carolina Early ░░░░░░░░ in states like Iowa ░░░░░░░░ to alesser degree in ░░░░░░░░ Hampshire just not enough ░░░░░░░░ follows mayor Pete and ░░░░░░░░ Steyer who have also ░░░░░░░░ out of the race ░░░░░░░░ Klobuchar apparently ending her ░░░░░░░░ bid We ll have ░░░░░░░░ after this.”