FEB 18
18 SIT EC y POL
ND denounce Global-neoliberal
debacle y propone State-Social + Capit-compet in Econ
ZERO HEDGE ECONOMICS
Neoliberal globalization is
over. Financiers know it, they documented with graphics
"Whether
the administrations of
the Government, The Fed, and select benefactors on Wall Street (among
others) are serially incompetent
or (more likely) criminally culpable for abusing their positions and power to benefit a small minority at
the expense of the vast majority is a
question in need of asking... "
See
Chart:
See more charts at:
Source: https://www.zerohedge.com/news/2018-02-18/how-did-america-go-bankrupt-slowly-first-then-all-once
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"... one thing which has
fueled the illusion of "recovery" is the fact that much of the data coming out of Washington has
been impregnated with Keynesian bias... this isn't merely a matter of intellectual sloth or even honest error.
There has been nothing remotely like a true
'recovery'... "
As we point out below, this isn't merely a
matter of intellectual sloth or even honest error. ..As we pointed out in this
series earlier, business cycle causation has been reversed in the era of
Bubble Finance. The Fed no longer has the
capacity to inflate the main street economy with unsustainable, credit-driven
booms.
Its monetary stimulus, in fact, never escapes
the canyons of Wall Street, where it fuels rampant speculation and pure
financial wagering until the resulting bubbles finally burst.
That is a recession
that neither the FOMC or Wall Street sees coming because they are essentially
focussed on the wrong data----the deltas, not the trends and levels----and because they mistakenly believe that monetary
stimulus actually stimulates the main street economy.
See chart:
Read more n see more charts at:
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“All these currencies, there is nothing backing the currencies except
the government’s force...They are all going to have a catastrophic drop... the
whole underlying structure of our economy is destabilizing..."
LISTEN VIDEO:
...
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In the US,
there is little top tier data of note, only the FOMC minutes on Wednesday night
where the market will be looking for affirmation of a highly anticipated rate
hike in March.
See chart:
Source https://www.zerohedge.com/news/2018-02-18/fx-weekly-preview-time-start-pricing-risks-away-usd
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"The only thing more dangerous to investors long-term outcomes
than being overly optimistic, is ignoring history..."
Let’s start with where we left off last weekend:
“Currently, we do not know whether the current corrective action is JUST
a normal, healthy correction, or the beginning of something bigger.
BUT – this is the expected correction we have been discussing
over the last several weeks. It is also something we had planned for by
reducing overweight positions and adding a short-hedge to portfolios.
With the markets on a short-term sell signal (noted by black
vertical dashed lines in the chart above,) the current correctional
process is underway. But, with the market now oversold on a VERY
short-term basis a counter-trend rally over the next week, or two, should be
expected.”
Well, we did indeed get a very nice rally last week with the market
breaking above the 50-dma on Thursday.
See Chart:
While the immediate consensus is the “bear market of 2018” is now
over, there are several important points about the chart above that should
be considered.
- Despite
the correction, the market did hold support at the 200-dma
- The bullish
trend line, which goes back to the beginning of 2016, has also not been
violated.
- However,
the upper red “trendline” may provide some overhead resistance temporarily
and is worth watching closely.
- While the
market did get oversold on a short-term basis, which suggested a bounce
was likely, the longer-term overbought condition, and subsequent “sell
signal” remain intact.
The bottom line is that while there was much “angst” in the
markets last week, the market has not violated any
important trend lines that would suggest the current sell-off is anything more
than just an ordinary “garden variety” correction.
The greenish triangle shows the path of the accelerated bullish trend
that began last August which currently remains the most likely path for now.
See chart:
The Real Bear Is Still Coming
The good news, for those who remain ever bullishly
inclined, is on a long-term, monthly basis, the bull market remains intact for
now.
Unfortunately, despite the rather harrowing
correction, little was done to relieve any of the underlying pressures.
- Valuations
still remain elevated
- Bearishness
and volatility, despite the recent spike, remain at historically low
levels, and;
- Investors
simply could not jump “back” into the markets fast enough.
These are not signs of a
real, lasting bottom, which long-term investors should aggressively buy into.
Given the current extension of the market, and the
deviation between the current price and long-term average, a real reversion to the mean is still coming.
If you thought the 10% decline over the last two weeks was painful, you should
be reconsidering the risk you are currently carrying in your portfolio.
See chart:
….
See more chart & comments at:
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"If
credit spreads do indeed reprice to higher volatility, the drawdown in credit
ETFs could trigger meaningful liquidation, resulting in further pressure on
spreads." - Deutsche
Bank
Going back to Deutsche Bank's volatility model, which maps the impact of
VIX on IG and HY spreads, the bank estimates that a 1
point rise in VIX is worth -0.6% to IG ETFs in aggregate, and -1.3% to the
universe of HY funds.
Such sharp moves have yet to be observed: thus
far, an index of IG ETF’s has fallen 1.2%, whereas the VIX shock should have
pushed it 3.3% lower, and an index of HY funds is down just 2% versus a VIX
implied drop of 7.2%.
See chart:
…
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“Inflation
is always and everywhere a monetary phenomenon.” —Milton Friedman
"...
it’s important to remember that the money–GDP correlation is merely a byproduct
of a lending–GDP correlation. Bank
lending, not money, is the driving force... economists built a
discipline (mainstream macro) on a false premise so significant it can’t be
corrected without starting over..."
Have you ever questioned Milton Friedman’s
famous claim about inflation?
Ever
heard anyone else question it?
Unless you read obscure stuff written for the
academic community, you’re probably not used to Friedman’s quote being challenged.
And that’s despite a lousy forecasting
record by economists who bought into his Monetarist methods.
Consider the following:
- When Friedman’s strict Monetarism fizzled in the 1980s,
it was doomed partly by his own forecasts. Instead of the disinflation the decade delivered, he expected inflation to
reach 1970s levels, publicizing that prediction in 1983 and then again in
1984, 1985 and 1986. Of course, years earlier he foresaw the 1970s jump in
inflation, but the errant forecasts that came later left him wide open to
a “clock twice a day” dismissal.
- Monetarists suffered an even harsher blow in 2012, when the Conference Board finally threw in
the towel on Friedman’s favorite indicator, removing M2 from its Leading Economic Index (LEI).
Generally speaking, forecasters who put M2 in their models are like
bachelors who put “live with mom” in their dating profiles—they haven’t
been successful.
- The many economists who expected quantitative easing
(QE) to wreak havoc on inflation are, of course, on the defensive. Nine years after QE began, core inflation
remains below the Fed’s 2% target, defying their Monetarist beliefs.
When it comes to explaining inflation, Monetarism
hasn’t exactly nailed it. Then
again, neither has Keynesianism, whose Phillips Curve confounds those who rely on it. You can toss
inflation onto the bonfire of major events that mainstream theories fail to
explain.
But
I’ll argue there might be a better way.
In three articles, I’ll try to convince you that we can develop a better
theory by interpreting Friedman’s research differently than he did. Maybe you’ll like the theory, or maybe you won’t,
but I promise this: the indicator that falls from it has a better
record predicting major inflation trends than any other serious indicator I’ve
studied. It’s not the only way to
think about inflation, but it’s realistic and practical, and I’m interested in
the reader reaction.
Round, Round, Get Around
In pictures, we can compare the traditional,
mainstream view to the alternative approach by sketching a “circular flow”
between spending and income. Here’s an example I’ve simplified from charts that
appear in my recently published book, Economics for Independent Thinkers, which
covers the topic in more detail:
SEE Chart:
Even
more importantly, these bank loan effects cumulative over time. If we say the chart above is the
current time period or period 1, then the next chart (below) shows that period 1’s new bank credit (or at least a portion of
it) is now part of the circular flow, and then it gets joined by period 2’s new bank credit. And
then periods 1 and 2 join period 3’s new bank credit and the flow gets fatter
and fatter.
See Chart:
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POLITICS
Seudo democ y sist duopolico in US is obsolete; it’s full of frauds & corruption. Urge
cambiarlo
A former Trump campaign aide and
longtime business partner of Paul Manafort, Rick Gates, will plead guilty to
fraud-related charges in the coming days, and has indicated that he will
testify against Manafort in upcoming proceedings.
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"The press has played an active role in
the Trump-Russia collusion story since its inception. It helped birth it... When the reckoning comes, Russia gate is
likely to be seen not as
a symptom of the collapse of the American press, but as
one of the causes for it."
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WORLD
ISSUES and M-East
Global depression is on…China,
RU, Iran search for State socialis+K- compet. D rest in limbo
Washington is moving inevitably on a global war plan. That’s the grim conclusion one has
to draw from three unfolding war scenarios...
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GLOBAL
RESEARCH
Geopolitics & Econ-Pol
crisis that leads to more business-wars:
its profiteers US-NATO
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INFORMATION
CLEARING HOUSE
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American Violence: Disorganized and Organized
By
Frank Scott
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Anti-T Use Mueller Indict to Escalate
Tensions With RU By Caitlin Johnstone
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SPUTNIK
and RT SHOWS
Geopolitics & the nasty
business of US-NATO-Global-wars uncovered ..
RELATED 1:
RELATED 2:
RELATED 3:
Ex-CIA Chief of Russia Ops: US Has Carried
Out Election Meddling Historically : “If you ask an intellig
officer, did the Russians break the rules or do something bizarre, the answer
is no, not at all,”
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RELATED:
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RELATED1:
Extreme 1.2: US' New Nuclear Doctrine Shows Country is 'No
Longer a Superpower' - Analyst So, we arrived to a new “end of history”… If you don’t accept US, we nuke you =
Terrorism at global scale?
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Do the worms of decomposition
have cameras to reproduce similar worms? Just kiting
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NOTICIAS
IN SPANISH
Latino America looking for
alternatives to neoliberalism to break with Empire:
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"¿Reconoce
este dron?": Netanyahu 'trolea' a Irán (VIDEO) Payaso sin par
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PRESS
TV
Global situation described by
Iranian observers..
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