Here Comes the “Omicron” Variant


    by Jim Rickards, Daily Reckoning:

    Last Friday, the Dow Jones Industrial Average fell 905 points, or 2.53%. The S&P 500 and Nasdaq indexes had similar falls, about 2.25% each.

    It was the worst Black Friday performance in history.

    Usually stocks rally on news of shoppers breaking down doors to buy bargains. The reason for the decline was reported to be new fears of the COVID pandemic in the form of the so-called omicron variant.

    This omicron variant was first identified in South Africa, but it has spread widely already. The small number of actual cases is not a source of comfort. What matters is the exponential spread of the caseload, not the actual numbers.

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    With exponential spread, the total caseload will overwhelm public health systems in a matter of weeks.

    How long will a surge of cases last? And what should be the public response to the new variant?

    Clueless Politicians Will Make Things Worse

    Here are a few tips to guide you through this variant outbreak: It will get worse but will fade by early February. That’s been a consistent outbreak pattern (about ten weeks start to finish) since the pandemic began.

    Masks and lockdowns won’t help; they never do. But they will be imposed anyway by clueless politicians, so get ready for the economy to slow down again.

    Vaccines won’t help (same with boosters). The vaccines appear to reduce symptoms and fatalities, but they don’t stop the spread. You can still become infected and spread the disease even if you’re fully vaccinated.

    So don’t buy the official propaganda you’ll be hearing in the coming days and weeks.

    What You Should Do

    The best approach is still to get outside without a mask, get fresh air, exercise and wash your hands. And in case you get sick, there are effective therapeutics you can take to stop the virus from progressing (hydroxychloroquine and ivermectin are just a couple).

    The key is to start getting treatment early. Unfortunately, the CDC has told people to wait around until they have trouble breathing before going to the hospital for treatment.

    But by that point the virus is already deeply entrenched and much of the damage is done. Treatment becomes very difficult at that point.

    That’s why early treatment is essential, despite what the public health authorities urge. It prevents the virus from replicating beyond control.

    Other than that, we just have to wait this out. Politicians only make things worse.

    The fact that the variants keep coming (the Italian Strain, Delta, now Omicron), is a sign that the original virus was bioengineered in the Wuhan laboratory.

    That’s because a natural virus mutates, but it becomes weaker over time. But this virus shows a remarkable ability to mutate around antibodies and other defenses.

    The Xi Variant

    By the way, these variants of the original Wuhan virus have been named sequentially after the letters of the Greek alphabet. The newest variant should have been called Nu, and the one after that would have been called Xi.

    The World Health Organization (WHO) skipped Nu (N) because of potential confusion with the word “new.” They also skipped Xi in order not to embarrass Chairman Xi of the Communist Party of China.

    The next letter is O, called omicron and that’s the one they selected. In case you were wondering whether the WHO kowtows to Communist China, there’s your answer.

    Regardless, bureaucrats and the politicians who listen to them are going to resort to the only tricks they know. Expect more lockdowns and other futile, counterproductive measures that have been proven to fail.

    Add the new virus variant to an economy that’s already slowing down due to supply chain disruptions and labor shortages, and we could be heading into recession very soon.

    This reality will catch up to the stock market. It’s time to lighten up your equity exposure and allocate more to cash and hard assets like gold.

    Here’s another reason you should acquire hard assets like gold: Inflation.

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