AUG 3 16 SIT EC y POL
ZERO HEDGE
ECONOMICS
This continues to be truly the most remarkable
"market." NICE SATIRE
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Yeah, but apart
from oil's failure to hold its gains, US earnings confirming their downtrend,
extreme low levels of complacency in VIX, US
banks decoupling from
rates, and Japanese government bond implosions: everything is awesome... [ Usual satire.]
Via
Fasanara Capital's Francesco Filia,
Check these FACTS
present by Pancho Villa illustrated with charts
To see them open: http://www.zerohedge.com/news/2016-08-03/5-things-focus
1-Oil failed to conquer and
retain 50$ and is now falling off visibly again:
.. We continue to expect Oil to move
erratically, alongside a downward trend, which will
eventually take it into new lows.
2- Oil and Base metals
decoupling, again, while moving in opposite directions. Base metals have closed their
underperformance gap vs Oil, which opened up in May, as they moved higher in absolute terms while Oil fell. All
this happened despite red-flashing signs of slowdown in the global
economy.
3- US Earnings and
US Sales confirm their downward trend:
US earnings’ and Sales keep deteriorating, having been in a
downward trend for the last 5 quarters. Valuations are over-stretched as a
consequence of (i) lower bond yields distorting equity vs bonds
valuations. Equity markets' consensus
for 2017 seems then to entail that (i) bonds are wrong in factoring in a
depressed economy . .. We
expect extreme valuations to give in, and cheaper US equities. To us, it
is more a question of 'when', rather than 'if'.
4- US Earnings and avg. Sales are
trending lower . .. S&P implied volatility moved to
new historical lows in recent past: lower implied volatility can only exacerbate the virulence of any downside movements, and
when they occur, for it seduces weak-hands bond-type investors into equity markets.
5- Low volatility is a value trap: it is not
so much a reason for an equity sell-off, but rather it may affect
its shape and tempo, should a sell-off occur, as we expect.
6- US Banks have decoupled from US rates: while EU
and Japanese banks have closely followed the path of interest rates / the slope
of the yield curve, US Banks have decoupled markedly from them. We
expect this divergence to correct in the following weeks, as US Banks move
lower more than rates, or move higher less than rates. Our case
for the EU Banking sector to hit new lows in the near future (see Article) - on
grounds of profitability more than solvency - can be extended to US banks
too. We look at this as a top value opportunity for the months to come.
7- US Banks have
decoupled from US yields The three following charts shows US, EU and
Japanese Banks against their respective government bond yields. Comparing bank
equities to the slope of the yield curve leads into similar conclusions. .. Japanese yields experienced their
largest 4-days sell-off since 2003. 10yr
JGB’s yield experience its largest 4 days rise since 2003
See Chart at: http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2016/08/03/20160803_5things6.jpg
This is a trend to be closely
followed, since it may lead to a larger sell-offs in US Treasuries and EU
Bonds, although temporarily, as it was the case in April/May 2015.
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"Without
growth, a credit-based economy ultimately devolves into Ponzi finance, and at
some point implodes..... I don't like
bonds; I don't like most stocks; I don't like private equity. Real assets such
as land, gold, and tangible plant and equipment at a discount are favored asset
categories." .. said Bill Gross
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For the first time
since 2014, the S&P 500 has exceeded the
average year-end forecast by Wall Street strategists... suggesting either this is as good as it gets, or
some upward adjustments to analyst guesses is overdue...
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For the adventurous Millennials looking to escape mom and
dad's basement we've identified a couple
of affordable housing markets for you...
….
If you're looking to be frugal
then Detroit or Toledo are great options for
you but if you're looking for size then Trulia would
suggest Austin or Atlanta as alternatives. But like everything, there's a catch...
LOOK AT THIS LIST:
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Most millennials say
they are skeptical they will ever be millionaires, according to a new study.
Worse, of all working Millennials, 54% of women said they live
paycheck-to-paycheck compared with 43% of men... With such a bleak future to
look forward to, we can understand why an entire generation's most marketable
skill is making selfish
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Following several repeat, and loud, warnings that sales are
slowing down, moments ago Elon Musk did not disappoint and reported results
that missed substantially on both the top and the bottom line, with non-GAAP
EPS of (1.02) nearly twice as bad as what consensus expected, while reporting
nearly half a billion in organic cash burn, while warning that "we have
reached our funding limit with a banking partner"
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The economic backwash of
too-expensive new cars and
the reappearance in the marketplace of affordable alternatives (good used cars)
is causing sales of new cars to wilt, probably precipitously, as invariably
happens in a Boom Bust cycle. The car industry will squeal for help from Uncle Sam – just like back in
the early 2000s. And Uncle will be happy to oblige, as he always is... But
Uncle’s “help” always comes at a cost.
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According to a just released Goldman analysis, the
sensitivity of US Treasury yields to economic data surprises has declined to
near record-lows over the last two years. In other words, the market no longer
responds to data. What does it respond to? "Treasury
yields have reacted more strongly to Fed communication." But
where it gets truly perverse, is that the market, by ignoring the economy, is
responding to a Fed which in turn is merely responding to the market.
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The grim reality is that real
inflation is 7+% per year.
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Following Monday's
confusing manufacturing data (PMI up, ISM down), today's Services
economy data suggests growth is just as confused and muted as PMI flat lined from June with activity at its
weakest in 5 months and new business slowing down. ISM Services missed
expectations (dropping modestly to 55.5 from 56.5) with employment dropping from 52.7 to 51.4 (despite a
bump in new orders). But, as Market concludes, "those
looking for signs of the US economy moving up a gear in the third quarter will
be disappointed by the PMI readings for July."
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Following June's epic bounce back in nonfarm payrolls - the
biggest delta to ADP in 6 years - Zandi and his crew at ADP 'got back to work'.
June's 172k print was revised higher to 176k with July's 179k print beating
expectations of 170k modestly (but still well below the payrolls levels). Once again goods-producing jobs fell (down 6k) as
Services dominated (+185k) as ADP warns “this
month’s employment number falls short of the 12-month average primarily because
of slowing in small business hiring.” The
weakness in construction spending is echoed in ADP's reported slide in construction jobs.
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POLITICS
If you want Donald Trump to win
the election, then you should be rooting for a stock market crash between now
and November.
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America has lost its way because
there are far too many who believe government is the solution rather than the
problem, far too many who
have traded their liberty for subsistence. As de Tocqueville once said, "The
American Republic will endure, until politicians realize they can bribe the
people with their own money."
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Normally, both Parties' nominees
have their own billionaires backing them (Republican billionaires backing
the Republican nominee, and Democratic billionaires backing the Democratic
nominee), and so there’s a real contest, they both have a chance; but not this time: Look at the figures, and you can
see that, this time around, virtually all of the
oligarchs are backing only one candidate: they have united around Clinton.
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Undercover videos
prove that committing voter
fraud in America is somewhere between very simple
and extremely simple...
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The Statist-Marxists (self-termed
“Progressive Democrats”) are by no means finished hacking away at the
branch of the Tree of Liberty bearing the 2nd Amendment of the U.S. Constitution.
The right of a free citizenry
to keep and bear arms is a right the Statists absolutely cannot tolerate. We have seen it all throughout
history: Hitler’s Germany, the Soviet Union, Cambodia…all
of the totalitarian states must take the firearms from the hands of their
citizens in order to make them subjects.
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ME & WORLD ISSUES
The neoliberal
debacle continue.
For the 3rd day in a
row, Unicredit shares are halted limit down as the "confidence-inspiring"
European banking system stress tests have utterly failed... as European banking stocks are reeling once again
(now down 10% post-stress-test).
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Recent Iraqi military gains over the Islamic State
have dried up oil revenues for the terrorist
organization by up to 90 percent, according to a report by
Iraqi News on Tuesday.
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The existential question, affecting every bond market in the
world, is suddenly this: are increasingly
negative rates and the yield structures they export of any transmissionable
benefit? Is the cure at some point worse than the disease? And
are they really sustainable? If the answer to
that changes from currently accepted theory, everything is mispriced.
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"Some of the
money that Iran [received from US taxpayers] is being used for those purposes
too... But the bulk of the money has been going to shoring up
their economic weakness, exactly how we predicted....But why is that relevant? Why is that relevant?"
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“Reports of the U.S.
paying Iran $400 million in pallets of cash, using other currencies in order to
circumvent American law, is something of Hollywood films—and is reminiscent of
the Iran Contra scandal,” Rep. Mike Pompeo said in
statement. “Have we not learned we cannot trust the world’s largest state
sponsor of terrorism?”
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While exceptional USA is heralded as savior of the world and
"greatest nation ever in the history of earth," by Hillary
Clinton, it appears Goldman Sachs disagrees... when it comes to The Olympics. From an 'efficiency' perspective,
controlling for how populous, rich (income per capita), and 'efficient' they
are, Russia is the greatest
olympic sporting nation (and ironically Greece is worst)...
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DEMOCRACY NOW
[[ Political mafia in
duopoly parties operates like mafia-vendetta in Al Capone’ time. Lucky Trump .. I
imaging him selecting a new VP between either a well-known leader from the
working classes used by Sanders .. OR
a well known leader of the blacks who break with
Hillary .. in either case “politics” will prevail over
money .. It will be like killing two birds with one shot.]]
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GLOBAL RESEARCH
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Can
Jill Stein Carry Bernie’s Baton? A Look at the Green Candidate’s Radical
Funding Solution By Ellen Brown,
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Alex Cuadros, author of Brazillionaires: Wealth, Power,
Decadence, and Hope in an American Country, says the PT, under the leadership
of Lula and Rousseff, has failed to disrupt corporate influence over politics
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Dave Zirin, author of Brazil's Dance with the Devil: The
World Cup, the Olympics, and the Fight for Democracy, says it's the perfect
opportunity for the anti-democratic forces in Brazil to market themselves as if
they are the saviors of the country
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Janae Bonsu & Montague Simmons say their demands for
black power, freedom and justice go beyond reform and require transformative
change
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A new bill introduced
by low income housing groups would roll-back the ruling that Under Armor CEO
Kevin Plank's Port Covington development does not have to build affordable
housing despite seeking hundreds of millions in taxpayer support
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COUNTER PUNCH
Howard Lisnoff The
War That Won’t Go Away
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Russell Vandenbroucke After
Hiroshima and Nagasaki
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Rick Sterling The
Biased Report that Led to Banning Russian Athletes
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Martha Baskin Massive Deployment of US WMD Spotlighted by
Peace Group
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RT SHOWS
Going Underground UK-backed
Islamists in Aleppo, blacklisting Saudi Arabia & Mark Duggan’s killing
(375)
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WASHINGTON BLOG
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NOTICIAS IN SPANISH
“Sólo con la candidatura de Lula no alcanza, tenemos que presentar nuevo
proyecto que supere al neodesarrollismo que ya se agotó”. Ent a J.P Stédile, fundador y dirigente del
Mov Sin Tierra
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Podrían ser usadas contra
“La ojiva nuclear B61-12”?
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PRESS TV
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'Assad best bet against Syria partition' divide Israel or Saudi
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Trump’s VP breaks with him over Ryan alianzas pegadas con mocos
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