| Dear Reader, The first day of this year’s Virtual Strategic Investment Conference started off with fireworks. David Rosenberg—founder and president of Rosenberg Research & Associates and a staple at the SIC—kicked off the day. This is his 11th SIC, and his presentation was quite sobering. Of the US government relief funds, David said, “This is not fiscal stimulus with any future payback—it’s government-assisted life support.” He warned of the economy falling off “a fiscal cliff” if the relief programs aren’t extended at the end of the summer. He pegged the real unemployment rate at over 20%, something we’ve last seen in 1933, and stated that we’re in a depression, not a recession. The silver lining: David sees a few bullish trends, ranging from consumer staples to utilities. He also shared his two favorite, high-conviction investment ideas. Next up was Samuel Rines, director and chief economist at Avalon Investment & Advisory. He said we can’t be sure which shape the economic recovery will take, but it’ll be staggered and staggering. This chart speaks volumes: 
Sam believes that staying at home and cars (vs. public transit) will be ongoing trends in the wake of the pandemic: “You don’t buy a Peleton bike and then go back to your old gym right away.” And social distancing is much easier in the comfort of your own car than in the subway. Dr. Lacy Hunt, former economist at the Dallas Fed and executive VP and chief economist at Hoisington, followed Sam Rines with a dim outlook. He said “the recovery will initially look impressive, but only because it’s an improvement from a catastrophic decline.” He predicted that by the end of this year, the US will face debt-to-GDP levels of up to 400%... and the EU, Japan, and China will be even worse off. Lacy is especially worried about corporate debt, which has been rising for eight years. Our next speaker, Matt Ridley, author of The Rational Optimist, brought a breath of fresh air by reminding us that innovation peaks in times of crisis and even though things look dire right now, the overall trajectory is up. We heard from political analysts Bruce Bartlett and Bruce Mehlman, as well as Ben Hunt, author of the Epsilon Theory letter, David Bahnsen and Rob Arnott of Research Affiliates. Even though the panelists came from opposite sides of the political aisle, they agreed that no matter who wins the US election in November, big tax increases in the US can be expected. Several panelists shared their best ideas when it comes to crisis-proof and crisis-profitable investments. There’s too much to fit into a letter this size, but if you order your Virtual SIC 2020 Pass today, you’ll be able to see the videos of yesterday’s presentations... and catch tomorrow’s lineup of all-star speakers live. Click here to order now. On Wednesday, you can look forward to our Europe Panel with Charles and Louis Gave, Anatole Kaletsky, and macro superstar Felix Zulauf... geopolitical news with George Friedman... our “Monetary Policy and Debt” panel with James Bianco, Woody Brock, Lacy Hunt, and Sam Rines, moderated by Renè Aninao... a fireside chat between natural resource investor Marin Katusa and successful gold miner Ross Beaty... and much more. I hope you’ll join us today, while you still have a chance to hear the SIC live and save 50% on your Virtual SIC 2020 Pass. Sincerely, 
Ed D'Agostino
Publisher
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