ND JAN
16 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
"...investors
don’t quite appreciate how important some of the longer-term structural themes are..."
China's yuan has surged to start the year, despite dismal
economic data and dramatic easing from the PBOC. US equities have soared since the start of the
year (NFLX +32%, C +18% YTD) despite tumbling
EPS expectations (and "little progress" on US-China trade talks). Cable has zoomed higher
for a month, despite an
increasingly vicious cycle of dismal results for May and her watered-down
Brexit plans.
Up is down, bad is good, but
water is always wet and The PPT is ever-present.
While markets remain focused on
the next headline and next ultra-violent high-frequency swing, Nomura's Bilal
Hafeez warns that investors
don’t quite appreciate how important some of the longer-term structural themes
are...
1)
US-China tech cold war.
2)
War on diesel cars (and environmental policy).
3)
It’s the liquidity cycle , not the credit cycle, that matters.
The trouble is that central
banks are slowly withdrawing their bid for risk assets, political risk has
increased and electronic trading algos disappear when market volatility spikes.
That’s the recipe for flash crashes.
The
challenge for markets is to correctly price liquidity premium on all assets,
which is not an easy task. It also means that market
moves could be less reflective of the credit cycle (and hence the
business cycle) and more a repricing of liquidity.
This means that we need to be wary of connecting price action to economic
fundamentals.
…
Read the full article at:
SOURCE:
https://www.zerohedge.com/news/2019-01-16/nomura-dont-ignore-these-three-big-structural-forces
----
----
The Lehman analog would suggest that
"Friday could mark a “local high” in SPX before resumption of a ~-5%
selloff over the 9 sessions thereafter."
See Chart:
S&P 500 2018:-10.90
2007-2009:-49.76
To
Nomura strategist, the "steepening" behavior in the yield curve will likely
dictate the terms of trade for US Equities factors as the post-GFC period
regime has seen steepening correlated to outperformance of
“Value-”/underperformance of “Growth-” and “Momentum-” factors in US Equities.
See Charts:
Value Factors are connected to
the Yield Curve and
Momentum
is inversely connected to the Yield Curve
Finally
this short-term liquidity injection adds to the larger “credit impulse” being
re-engineered by Chinese authorities, which on the headline level came
in as “better than consensus” estimates across new aggregate social financing
& new loans.
In
other words, while China is scrambling to offset the adverse effects of ongoing
deleveraging, the question is whether or not it will succeed, with the
risk of course being that continued trade war and economic slowdown spills over
into other risk assets. So keep an eye on both news out of China and the Lehman
analog chart for clues if the torrid last December, early January rally is
about to peak in just two days and roll over once again, as Morgan
Stanley also predicted earlier this week, would happen.
See
Chart:
Nearby Tech
Resistance Overhead is formidable
…
----
----
"Do
you think it was a coincidence
that PG&E management did little to recapitalize the balance
sheet for fire liabilities... at the cost of the stock price, their bonuses, stock options and probably jobs?
"
The PG&E case in California is rife with risk management lessons
where we can learn from the mistakes of others while they pick up the tab.
A big story in the financial
news lately is the significant liabilities incurred by Pacific Gas and Electric
or PG&E, the biggest electric company in California. The company’s core
business is to generate and distribute electricity, and as a part of that
business, they maintain the power lines that connect the power grid.
Government authorities have concluded that many of
the fires that ravaged California over the past two years have been the result
of power lines falling into trees, and California law finds PG&E liable for
any costs related to fires where power lines were at fault. Matt
Levine, a man so cynical and sarcastic he makes me look downright kind and
forgiving, crushes
the capital structure story. Levine brilliantly points out that
there weren't any secrets here....only a massive unfunded liability that had
PG&E whistling past the graveyard for years...and certainly throughout
2018.
PG&E is, for all intents
and purposes, bankrupt. How
did a regulated utility get to that point so quickly? What were the warning
flags? Was there a trade here?
Here is the stock chart back to
2004. In early 2017, you were probably feeling pretty good. Nice run higher. No
big surprises. The dividend has been increased consistently over the past two
years and credit ratings has been raised.
See
Chart:
PG&E Stock Price, 2004-2018
When the November 2018
Camp Fire destroyed about 10,000 structures, about 100 people and wiped an
entire town of 20,000 people off the map, PG&E was finished. But even then,
it took a while before common knowledge caught up.
Yet those looking for how this risk was priced could have also used
credit markets to illustrate this increasing risk…below I have a chart of
PG&E’s credit risk in 5 year credit default swaps (CDS). Note how
throughout 2018 credit risk was increasing (a higher or wider CDS spread
reflects an increasing risk of default), even before the Camp Fire.
See Chart:
PG&E 5y CDS
Bottom line, bond markets
sniffed this out while equity markets pushed the stock 9% higher in 2018 before
the fire on November 8.
See Chart:
Do you think it was a
coincidence that PG&E management did little to recapitalize the balance
sheet for fire liabilities or commit to an
extreme and fast maintenance fix when they couldn't pass the costs on to
tax payers? Which
means... it would have been at the cost of the stock price, their bonuses,
stock options and probably jobs?
PG&E management and stockholders clearly dramatically underestimated
the costs and liabilities attached to fire risk. Some was willful, some was stupidly
optimistic, and some was no doubt simply a combination of unlucky and
ignorant. The fires had incredible human costs. It will
also go down as a case study in capital structure, management incentives, and
the value of macro analysis that identifies incentives and opportunities across
asset classes.
…
SOURCE: https://www.zerohedge.com/news/2019-01-16/pges-massive-risk-management-fail-intent-or-ignorance
----
----
For the 3rd
week in a row, gasoline (and distillates) inventories soared. However, crude stockpiles slipped slightly more than
expected and Cushing inventories dipped most since Sept 2018 but WTI was
spooked as US production surged to
a new record high.
See Chart:
----
----
US DOMESTIC POLITICS
Seudo democ duopolico in US is
obsolete; it’s full of frauds & corruption. Urge cambio
Can they do that?
----
----
...Judge
Lamberth wrote that Clinton's use
of a private email account was "one of the gravest modern offenses to
government transparency" and said the response of the State
and Justice Departments "smacks
of outrageous misconduct."
----
----
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
"Gloves off" in face to face military talks in
Beijing.
----
----
SPUTNIK
and RT SHOWS
GEO-POL n GEO-ECO ..Focus on neoliberal expansion via wars
& danger of WW3
NOTICIAS
IN SPANISH
Lat Am search f alternatives to
neo-fascist regimes & terrorist imperial chaos
REBELION
----
----
----
----
----
----
----
----
----
ALAI NET
----
----
----
----
----
RT EN ESPAÑOL
----
----
----
----
El Zoom Trump: Una kurda realidad
----
----
COUNTER
PUNCH
Analysis on US Politics &
Geopolitics
----
Jeff
Mackler Trump’s
Syria Exit Tweet Provokes Washington Panic
----
----
Thomas
Knapp Now
More Than Ever, It’s Clear the FBI Must Go
----
----
GLOBAL
RESEARCH
Geopolitics & Econ-Pol
crisis that leads to more business-wars from US-NATO allies
----
----
----
----
----
DEMOCRACY
NOW
Amy Goodman’s team
----
----
----
----
PRESS
TV
Resume of Global News described
by Iranian observers..
----
----
----
----
----
----
----
----
----
----
----
----
===
No hay comentarios:
Publicar un comentario