Disarray among the Democrats, coupled with some "good" news on the virus, explains some of the positive momentum in the market. Neither is expected -- and both, coupled with the bountiful liquidity from the Chinese government, makes me think that the bifurcation between domestic and international is even larger than it was when the trade war raged.
But let's step back for a second and deal with what's happened in the last 48 hours, because it holds the key to the employment number Friday, the next big deal piece of data.
First, you can tell from yesterday's key CDC briefing that they are relieved about President Trump's shocking ban on coming here for anyone who has been in China for the last couple of weeks. That's because the CDC wants this issue to be a public health issue not a medical issue.
As long as we are not overwhelmed with new cases, the CDC seems to think that it will be able to slow the virus down to where its consequences -- the actual cure rate -- can be raised. Initially, there was some question about whether the test they are using can even detect the virus. Now, the CDC seems not only confident the test works, but they are also confident in their ability to track people who may have been infected. I wish I felt as confident as they seem to be, but it is certainly a change of pace from last Friday's presser -- and it is a must read.
Second, while no one is denying that the Chinese situation is horrible, including the CDC, the Chinese seem to be making use of their dictatorship capabilities to cordon off the area with the biggest group of infections, the Wuhan area. What's happening in that area is disastrous, but you get the sense that the Chinese will stop at anything to get this thing under control, at least when it comes to its financial implications. If they can keep the GDP decline to 1%, you can expect slower orders for American companies, but there could be a resumption of factory production in the near future.
Finally, hate him or like him, Trump is considered great for the stock market. The total disarray is considered great for Trump. The president has very little at risk against a socialist candidate. On Wednesday, he is free from the Democratic Party's non-stop attempt to not allow him to be president. It plays right into the President's hand.
So, with all of that good stuff, you can see the rally continue. I remain a seller into the session -- if only, again, to be cautious that the CDC could be right, but it may be false security if someone dies in this country from the virus. Although I have to believe it would be someone of pre-exiting poor health who does not know to go to a hospital.