JUN
10 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
This is
going to cause an evaporation of dollar liquidity
– making the markets
extremely fragile.
See Chart:
The huge tax cuts
and government spending requires a significant amount of new debt to be issued,
all while the Fed’s tightening and unwinding their balance sheet via
Quantitative Tightening (QT).
This
is going to cause an evaporation of dollar liquidity – making the markets
extremely fragile.
Putting it simply – the soaring U.S.
deficit requires an even greater amount dollars from
foreigners to fund the U.S. Treasury. But if the Fed is shrinking their
balance sheet, that means the bonds they’re selling to banks are sucking
dollars out of the economy (the reverse of Quantitative Easing
which was injecting dollars into the economy). This is
creating a shortage of U.S. dollars – the world’s reserve currency –
therefore affecting every global economy.
See Chart:
This type
of Asymmetric development (slow start – fast finish) is an example of
‘Critical Mass’... Putting it simply, Critical Mass in laymen
term is ‘the last straw
that breaks the camel’s back’.
It’s not like during
those five years in the soil the bamboo seed wasn’t doing anything. It was
taking its time deepening its roots and harnessing energy. Then once Critical Mass was reached – growth went
parabolic.
Just like the
markets over the last couple of years of Fed tightening
– only because we don’t see what’s brewing underneath the surface
doesn’t mean things aren’t happening.
See Chart:
Another thing learned from Complex Systems is that the
larger the system is, the more energy it requires. And
in over indebted economies – that means more dollars
are required.
As government deficits soar
and need constant funding, and bloated
corporations are up to their necks in debt – they need even
more dollars and even lower rates if they plan to not crack.
Unless the
Fed reverses their
tightening soon, things can get very ugly – and very fast.
[[ In short: there is no way to save the death of neoliberal
Economy.. its corpse is already rotten ]]
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Source: https://www.zerohedge.com/news/2018-06-10/when-will-investors-care-about-dollar-shortage-crisis
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Instead of
worrying about inflation getting away from the Fed, the market is more
worried about a short-term spike in inflation than a sustained long-term
rise...
The three Ds (deflation, demographics, and debt) were on
everyone’s lips. It made little sense to invest in inflation-protected
securities when everyone knew there could be no inflation.
Well,
guess what? That 1% 5-year breakeven rate has now risen to 2%.
See Chart:
Today the market is expecting the Federal Reserve to hit its
2% inflation target.
But the most interesting part of
this higher repricing of inflation expectations? Instead of worrying about
inflation getting away from the Fed, the market is more worried about a
short-term spike in inflation than a sustained long-term rise.
To
illustrate this, let’s look at the US 2-year and 30-year breakeven inflation
rates.
See Chart:
The vast
majority of the inflation expectation rise has been centered at the front end
of the curve!
Here is another way to think about
it. Instead of looking at breakeven inflation rates, let’s look at the yield
curve of TIPS securities. This is “real yield” - the rate which an investor
will earn after inflation.
See Chart:
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SPEAKING
OF WILE E. COYOTE MOMENTS...
Last
Thursday, speaking at the American Enterprise Institute, Bernanke
echoed Bridgewater's
biggest concernabout the sugar high facing the US economy for the next 18
months, saying that the stimulative impact from Trump's
$1+ trillion fiscal stimulus "makes
the Fed's job more difficult all around" because it's
happening at a time of very low unemployment; it also means that the more
supercharged the economy gets thanks to the fiscal stimulus, the greater the
fall will be when the hangover hits.
Stealing further from the Bridgewater note,
Bernanke said that while the stimulus "is going to hit the economy in a big
way this year and next year and then in 2020 Wile E. Coyote is going to go off
the cliff, and it's going to look down" just when the US
economy collides head on with what Bridgewater called
"an unsustainable set of conditions."
However, as
Global Macro Monitor notes, it's not just the economy that faces its Wile
E. Coyote moment.
Stunning valuation
metric of the U.S. stock market.
We used the Fed’s Flow of Funds for all domestic sectors for
corporate equities in the numerator. It is the same numerator
as Doug
Short’s but includes the equity market value of the financial sector:
See Chart:
Conclussion:
Bernanke’s Wile E.
Coyote moment is coming to the stock market. THE
QUESTION IS NOT IF BUT WHEN? Our
bet it will be certainly before Gentle Ben’s.
Rentals only, my long brothers and sisters.
Stay
tuned, Road-runner.
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"Financial disaster is
quickly forgotten. There can be few fields of human endeavor in
which history counts for so little as
in the world of finance..."
The Ponzi Economy
Let’s return to the concept of a dysfunctional economy,
where consumption is largely financed by accumulating debt liabilities to
supplement inadequate wages and salaries, where government runs massive fiscal
deficits, not only to support the income shortfalls of its citizens, but
increasingly to serve and enhance corporate profits themselves, and where
corporations enjoy lopsided profits with which they further leverage the
economy by engaging in a massive swap of equity with debt.
This setup would be an interesting theoretical study in risk
and disequilibrium were it not for the fact that this is actually the situation
that presently exists in the U.S. economy.
The chart below shows wages and
salaries as a share of GDP. This share reached a record low in late-2011, at
the same point that U.S. corporate profits peaked as a share of GDP. That
extreme was initially followed by a rebound, but the share has slipped again in
the past couple of years.
See Chart:
Based on population and demographic factors, even if the
unemployment rate remains at 3.8% in 2024, employment growth will contribute
just 0.6% annually to GDP growth, leaving productivity growth (averaging well
below 1% annually in the recovery since 2010) to contribute the balance. Without the cyclical contribution of a falling unemployment
rate, real U.S. economic growth is likely to slow to well-below 2% annually,
and even that assumes the economy will avoid a recession in the years ahead.
See Chart:
Wage inflation has been quite limited in the aftermath of
job losses during the global financial crisis. Given a tightening labor market,
an acceleration of wage gains will be good news for employees, but the delay
has contributed to quite a few distortions in the interim.
One clear distortion is that profit
margins have been higher and more resilient in this cycle than in prior
economic cycles. Again, this elevation of profit margins is a mirror image of
slack labor markets and weak growth in wages and salaries. The relationship
isn’t perfect, as a result of quarter-to-quarter volatility, but the inverse
relationship between the two is clear.
See Chart:
….
See more charts at:
….
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"The
steady performance of tech stocks has only reinforced the perception that they
are defensive.... but with
financial conditions likely to continue tightening, the moment of truth it
could be at any moment, and without warning."
See Chart:
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[[
Los inversores dicen la verdad: el neoliberalism se fue a la merda.. WORSE if we start WW3:
Not only because we will be hit by Nukes –as never happen before- but because
our internal division will create a barbaric violent chaos to destroy current Fed
(we don’t need it). The path is secession and new type of REV, anarchical at the beginning , to then create a
new regional States & Economy with Schools & Heath system out of the hand of predatory Corp. New Coop -banking system will emerge to support small &
middle size entrepreneurs across all regions of the ex-USA. Perhaps we
may end adding one more “S” to mean: UNITED SOCIALIST STATES OF AMERICA. One statement is clear
now: “caminante no hay camino.. se hace camino
al andar. We must organize this Revolution Now!. Forget Elections: it lead to corruption (buy Elect by big Corp) and more chaos.
We need an organized Rev.]]
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US
DOMESTIC POLITICS
Seudo democ y sist
duopolico in US is obsolete; it’s
full of frauds & corruption. Urge cambiarlo
Hillary’
resurrection? Impossible: Lazarous .. Levántate! .. y el cadáver.. siguió
pudriéndose
[[ Sugerencia: Cambien los bufones
de este circo .. dan pena, no risa.. or pack-up & a la merda! ]]
Much to President Trump's delight, Inspector
General Michael Horowitz is preparing to release the long-awaited report on the
James Comey-era FBI and its handling of the Clinton email probe.
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[[ There is not stub in well-known crooks of Las
Vegas casino.. They played against their Nations ]]
"President
Trump played that process in good faith. So, I ask you: He gets up in the
airplane and leaves, and then Trudeau starts blasting him at a domestic news
conference? I am sorry, that’s a betrayal. That’s a double cross.”
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Narcissit’ Hillary already destroyed the world by creating Islamic
Terrorism paid by Saudis In Libya.. She also destroyed the Benghazi-US Embassy
killing 4 American stuff.. a crime still un-punished
"The bigger the danger, the bigger the threat, the more I feel engaged to confront it..."
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US-WW ISSUES (World & War): M-East .. plus
Global depression is on…China, RU, Iran search for State
socialis+K- compet. D rest in limbo
THE OPEN MILITARY WAR WITH CHINA IS
NEAR ..we already lost the trade war
A US fighter jet has crashed into the sea off the coast of the Japanese
island of Okinawa, according to Reuters,
citing Japanese media. The jet is
believed to be an F-15.
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US reporters on China can’t be trusted before checking China Sources.
But, their covered intentions can be
guess by reading between lines
Chinese
hackers stole a total of 614 gigabytes of plans for cutting-edge weapons
relating to various undersea programs, as well as sensor data, submarine
information about cryptographic systems, and an entire library of submarine
electronic warfare data.
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There is a reason why gold is stored and why NATO allies
plan to still them via WW3: opium dream
Ultimately,
the value of gold is based on its tangibility...
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SPUTNIK and RT SHOWS
US inside GEO-POL n GEO-ECO ..News
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Noting that the US-British-French tripartite didn’t provide
the public with evidence that an attack actually took place at Douma,
Assad said that this wasn't the point. "The crux
of the issue is that they need to undermine the Syrian government,
as they needed to change and topple the Syrian government at the
beginning of the events of the war in Syria. They keep failing,
they keep telling lies, and they continue to play a war of attrition
against our government," the president said.
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Uno le
extorsionó la mano y el otro fue al cuello.. con amigos como estos .. para que
enemigos
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Una vez que
se destruya el ‘bunker’ donde se fabrican USD, + Dimona y bases aéreas.. adiós
ISR. El renacer de ISR seria bajo limites set in 1948, con Estados FED deigual
Repres a PAL y sin Jerus as Cap
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SHOWS RT
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NOTICIAS IN SPANISH
Latino America looking for alternatives to neoliberalism to
break with Empire:
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Un caza F-15 de EE.UU. se estrella
cerca de la isla japonesa de Okinawa empezaron a caerse
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INFORMATION CLEARING HOUSE
Deep on the US political crisis, their internal conflicts n
chances of WW3
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V Putin - Annual ‘Direct Line’ Q&A in
Moscow Video and transcript Will
there be a World War 3?
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GLOBAL RESEARCH
Geopolitics & Econ-Pol crisis that leads to more
business-wars: its profiteers US-NATO
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PRESS TV
Global situation described by Iranian observers..
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The debate: G7 Showdown
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