JAN 4 19 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
Bastó
la amenaza de que lo sacarían y P devino Spirit: la fe y la prensa mueven
montañas: 2+2=5
[[
Los Milagros del
espiritista “Powell”no son pedos, son
real spirits los que levantan al muerto ]]
“The strong
December jobs report is a net positive for stocks because investors’ biggest
concern has been slowing growth,” said FTSE Russell managing director
Alec Young. "December’s strong job gains help ease
that concern. It’s hard to square recession worries with the strongest job
growth we’ve seen in years" Young added after payrolls not only
surged by over 300K but average hourly earnings surprised to the upside and
rose by the most since 2009, signalling that inflation is anything but dead.
See Chart
Monthly NFP Change:
‘000s
But the biggest catalyst for today's rally was today's
statement by Chairman Powell which eased much of the
market's fears that the Fed put is dead and buried.
Speaking on a panel with Janet Yellen and Ben Bernanke,
Powell said central-bank policy is flexible and officials are “listening carefully” to the financial markets.
Critically for traders worried about shrinking liquidity in the economy, Powell also signaled a willingness to consider changes to the
Fed’s gradual run-off of its balance-sheet in any policy review.
That was enough to unleash the
animal spirits, with stocks surging after
Powell's comments which many saw were directed squarely at the market.
See Chart:
Markets Rejoice
“The Powell/Yellen/Bernanke show had
a simple purpose: re-assure the market that the Fed is not in disarray and that
it will act to protect the market on a further downtick than what we saw in
December,” Wallach Beth strategist Ilya Feygin told Bloomberg. “The Fed will likely keep rates on hold for a while until it
has more confidence in the data.”
And while Powell wasn't
explicitly dovish, the fact that he wasn't hawkish was more than enough
to unleash a powerful rally that sent the Dow over 800
points at one time, and closing 747 points higher undoing all of Thursday's
losses...
See Chart: Dow Jones
While today's rally will be a welcome - if temporary - relief to bulls, and certainly to president
Trump who delights in a rising stock market which he sees as a barometer
of his performance, the unprecedented volatility in
the market now appears to be a constant
feature with the the S&P 500
now trading in an intraday range of more than 2% on 15 of the last 21 days, the most since 2011 according to
Bloomberg. Whether anyone other than algo traders can
"trade" such a rollercoaster market remains
to be seen.
See Chart: Big Jumps
The surge in stocks, driven by a dovish take on Powell, also
helped push Treasury yields sharply higher...
... with the yield on the 10Y rising
the most in percentage terms in two years.
See Chart:
One Day % Change in 10Y TSY
Curiously, even as selling of equity
volatility returned with a bang, with the VIX tumbling to the 20 level which
has been the average for much of the past three months...
See Chart: VIX
One surprising
outlier that was missing from today's euphoria, however, was the dollar which continued its recent slide, and
after it initially spiked following the strong jobs
report, it tumbled anew after Powell's dovish comments despite the powerful rally in Treasury yields.
See Bloomberg Chart: BBDXY
Finally, before traders read too much into today's rally,
recall what Trump's economic advisor Kevin Hassett warned yesterday, namely
that "it’s not going to be just Apple,” adding that "there are a heck
of a lot of U.S. companies that have sales in China that are going to be
watching their earnings being downgraded next year until we get a deal with
China."
For now, however, at least
until the next major bearish surprise, stocks close out the day and the week
with a powerful rally that has, at least for the time
being, put concerns about an imminent US recession on mute.
…
===
... absent
an increase in overall market volume, liquidity will collapse to even more unprecedented
depths as the volume/volatility ratio hits new all time lows.
See Chart:
Volume/volatility ratio
tracks top-of-the-book DEPTH
Why is this a concern?
Because in a time when the entire asset class of active
investing is increasingly endangered by the encroaching threat of passive investing
resulting in prominent hedge funds shuttering left and right and removing
marginal market players, and where HFTs are now cannibalizing each other and
unable to "provide liquidity", i.e. offset any sharp jump in trading
volume, as a result of unprecedented commoditization of order flow, trading
volumes - in both absolute and delta-one terms - will keep declining. This is
how Kolanovic explained the recent trends observed in the market:
The depletion of market reversion forces was driven by a decline of
value investors (as money moved to passive and systematic strategies), a shift
of assets from public to private equity (private equity has a more favorable
mark to market treatment, thus creating arbitrage between public and private
equity), and a reduction of human risk taking activity after the 2008 crisis
(e.g., block traders, prop desks, etc.).
Said otherwise, with volatility
expected to keep rising as central bank liquidity withdrawal accelerates in the
coming months, something BofA
discussed two days ago when it noted that "a
flattening in the yield curve over the last three cycles has preceded rising
volatility by about three years" and
thus "expects a more volatile backdrop for US stocks in the coming
years", going so far as to suggest that volatility will "likely double by 2021"...
See Chart 1:
Flattering yield
curve suggest higher volatility through 2121
... absent
an increase in overall market volume, liquidity will collapse to even more
unprecedented depths as the volume/volatility ratio hits new all time lows.
Which takes us back
to something Kolanovic said yesterday, namely that "Equity markets could
benefit from a rethinking of the current state of liquidity provision and of
market reversion forces." In this particular case, the JPM quant is absolutely correct, because if the current trend of
rising volatility coupled with declining delta-one volumes continues, the
result will be a market in which the top-of-book depth eventually collapses to
zero and where even the smallest order has the potential to unleash chaos.
See more interesting
charts at the beginning of this art
…
===
"A less-certain economic outlook"
Here are seven China
charts that should keep investors up at night.
Retail-sales growth cratered to its lowest level in 15
years in November, as Beijing's efforts to slash personal income tax failed to
lift spending.
See Chart:
Retail Sales
https://www.zerohedge.com/sites/default/files/inline-images/retail%20sales%20china.png?itok=fQpyMCvS
Property
Sales have also moderated
significantly in the last three years, which may lead local governments to ease
restrictions on home purchases in 2019 according to analysts.
See Chart:
Property Sales
Chinese
auto makers have also been
feeling the heat from sagging sales, seeing their largest drop in almost seven
years during November - marking the fifth straight monthly decline. The
industry is on track for its first annual sales drop in nearly 30 years.
See Chart:
Auto Sales
Consumption
tax revenue cratered in
October to the tune of 61.6% year-over-year, only to drop 71.2% in November.
The indicator of cojnsumer spending is a tax imposed on luxury goods such as
jewelry and high-end cosmetics, or items deemed to be environmentally
unfriendly such as cars and gasoline.
See Chart:
Consumption Tax Revenue
Industrial
profits have been cooling
since May of last year after hitting double-digit growth in 2017, as subdued
factory price gains and slower sales took their toll.
See Chart:
Industrial Profit
The Purchasing
Managers Index (PMI) contracted
in december following nearly two years of expansion. "The downbeat PMI
readings suggest China’s economic growth likely decelerated further in the
final quarter of 2018 and the slowdown is expected to continue this year," according to the Journal.
See Chart: Purchasing Managers Index
Lastly, China's GDP has slowed to its weakest pace in
almost 10 years during the third quarter, and is expected to slow further over
2019. GDP is expected to fall to 6.4% in the fourth quarter, down a smidge from
third quarter growth of 6.5%.
See Chart:
Quarterly GDP
…
===
“A lesson from history is that the market
leads the economy by a lot longer than investors realize..."
Hell, why not
believe the strategists and analysts, they nailed AAPL right?
See Chart:
And that
was before a revenue warning from Apple sent
markets into another steep fall on Thursday,
only to retrace it all in an epic reversal today as
Powell shifted into full PPT mode, proclaiming America's economic momentum
strong...
See Chart:
Of course,
the unrelenting cry from the asset-gatherers and commission-takers is how
'cheap' the market has become on a forward-P/E basis:
See Chart:
Volatility? Given today's panic-bid -we gona go back to Wednesday's highs...
See Chart:
Nothing
would surprise us anymore.
…
===
“I don’t know.”
===
US
DOMESTIC POLITICS
Seudo democ duopolico in US is obsolete; it’s full of frauds
& corruption. Urge cambio
"Yeah, if that’s what radical means, call me a
radical."
===
Things often calm down after January 1 during El Nino years... but
not this year...
===
"We
can call a national emergency and build it very quickly..."
[[
IT means that you failed the Democratic way.. Are declaring a fascist
coup?]]
===
"We're not playing games. We have to do it."
===
“I am begging you
please allow me to have my truck
back.”
===
US-W ISSUES (Geo Econ, Geo Pol &
global Wars)
Global depression is on…China, RU, Iran search for State
socialis+K-, D rest in limbo
Mission to
include its new domestic built stealth destroyer.
===
SPUTNIK and RT SHOWS
GEO-POL n GEO-ECO
..Focus on neoliberal expansion via wars & danger of WW3
RELATED 1
RELATED 2
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Lima Group
es una agencia de la CIA con base en la Embajada USA en Lima. No es la 1ra vez
que este grupito desarrolla agendas imperiales e intervencionistas en el Sur
Latino.
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SHOWS RT
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NOTICIAS IN SPANISH
Lat Am search f alternatives to neo-fascist regimes &
terrorist imperial chaos
REBELION
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ALAI NET
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RT EN
ESPAÑOL
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INFORMATION CLEARING HOUSE
Deep on the US political crisis: neofascism & internal
conflicts that favor WW3
Chinese Culture On The Far Side Of The Moon By Moon Of Alabama
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Has Trump Been Outmaneuvered on Syria Troop
Withdrawal? By Senr Dick
Black
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Israel Is Bad for America By Philip Giraldi
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FOR TOMORROW:
COUNTER PUNCH
Analysis on US Politics & Geopolitics
…
GLOBAL RESEARCH
Geopolitics & Econ-Pol crisis that leads to more
business-wars from US-NATO allies
…
DEMOCRACY NOW
ND denounce Global-neoliberal debacle y propone State-Social
+ Capit-compet in Econ
…
PRESS TV
Resume of Global News described by Iranian observers..
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