ND
AUG 13 19 SIT EC y POL
ND denounce Global-neoliberal debacle y propone State-Social
+ Capit-compet in Eco
ZERO HEDGE ECONOMICS
Neoliberal globalization is over. Financiers know it, they
documented with graphics
Today's
insanity was brought to you by the words "delay" and
"protests" and by the number "0" as Trump blinked and 'delayed' some China
tariffs, Hong Kong 'protests' in the airport escalated, and all eyes were on
the UST curve's 2s10s spread rapidly plunging toward '0'...
A big day for US equities thanks to
trade headlines rescuing another ugly overnight session...
See Chart:
Cyclicals outperformed, as you'd
expect, today; but since Friday, Defensives are leading...
See Chart:
Stocks, as always, more excited than
bonds about everything...
See Chart:
Nasdaq vs. 10Y Yield
As StanChart's Steve Englander noted: "The
key characteristic of recent episodes of risk-off and risk-rebound is that the
equity-market consequences are largely reversed, while the downward moves in
fixed income have largely stayed in place."
Treasury yields were all notably
higher on the day, spiking after the trade headlines (but the long-end
dramatically outperformed the short-end) - also note
that all yields slipped lower in the last hour (only 2Y is higher in yield on
the week)...
See Chart:
But the yield curve refused to stop
flattening, with 2s10s falling below 1bps for the first time since May 2007...
See Chart:
Trade vs.
UST 2s 10s Spread
And UST 2s30s crashed to its lowest
levels of 2019...
See Chart:
UST 2s 30s Spread
The odds of a 50bps cut in September
plunged to 14% today...
See Chart:
September Fed Rate-Cut Odds
The Dollar managed gains on the day
but remains within a very narrow range since The Fed cut rates...
See Chart:
Bloomberg Dollar Index
The Yuan exploded higher on the
trade headlines, surging below 7.0/USD before fading back to the CNY Fix...
See Chart:
CNY Fix vs. Offshore Yuan
The Hong Kong Dollar was relatively
volatile intraday but remains a few pips away from the 7.85 weak-end of the USD
peg band...
See Chart
USD-HKD (inv): Trade vs. Trump Tweet
The Argentine Peso did not stop its
freefall...[ IMF injection of USD
didn’t work ]
See Chart:
WTI Crude ramped up to $57 handle
ahead of tonight's API inventory data...
See Chart:
Finally, some context for the
headlines today, the market-implied odds of a trade deal initially spiked but
faded back as the day wore on...
See Chart:
Market-Implied Odds of US China
Trade Deal
And Bloomberg's Tom Orlik explains
why: Tariffs are not the only, or
perhaps even the main drag from the U.S.-China trade war. That prize
goes to head-spinning policy uncertainty….
See Chart:
A gauge of trade policy uncertainty
in the U.S. is at levels not seen since Nafta ratification in the 1990s. China
and Europe face a similar problem.
….
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“We still have an undecided oil
market,”
WTI hovered around $57 the figure,
but started sliding notably ahead of the data and tumbled further on the 2nd
surprise build in a row (Of course, WTI is still up on the day)...
See Chart:
….
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And that's
just the start.
When it comes to investing in safe assets such as US
Treasuries, the decision process is relatively simple: one buys coupon
securities (with a maturity over 1 year), on specific expectations of inflation
(or deflation) and receiving current income in the form of a cash coupon
(assuming there is one). When it comes to T-Bills the decision is simpler: it's
all about liquidity preference - does one keep cash equivalents in the form of
US Dollars, whether paper or electronic, or does one purchase Bills, with a
maturity from 4- to 52-weeks.
If investors are mostly happy to exchange money for Bills,
it is generally said that liquidity in the financial system is ample; if
however investors are unwilling to part with their "cash" in order to
fund the US Treasury (as a reminder, in a time of chronic budget deficits,
Uncle Sam has to issue debt to fund its operations), then
there is a liquidity shortage.
See Chart:
US Treasury actions will likely
tighten USD liquidity in coming months
In fact, according
to Bank of America the liquidity shortage over the next two months - a
period in which as shown in the chart above the Treasury would aggressively be
issuing bills - would be so acute, that the Fed may be forced to launch QE, a
conclusion which JPMorgan
echoed just days later.
Today, we got the first proof that Bank of America may be
right when we observed just how tight liquidity already
is in today's sale of $28 billion in 52 week bills by the Treasury, an
auction which went so poorly it was widely panned by analysts, with Stone &
McCarthy going so far to describe it as terrible.
For those who missed it, this is what happened: today, just before noon, the Treasury sold $28 billion of 52-week
bills at a yield of 1.80% versus the when-issued level of 1.775%; while
the WI may have been "too rich for the buyside" according to
Jefferies economist Ward McCarthy, the massive, 2.5bps tail was the largest on
record since Treasury began to auction 1-year bills in June 2008, Stone
& McCarthy analysts wrote.
Worse, the bid-to-cover of 2.66 was
not only sharply below the 2.87 from last month, it was the lowest since 2008.
See Chart:
52-Week Bill Bid to Cover
The auction was so ugly, in
fact, that it prompted Jefferies to notes that "if you are looking for a
pretty auction, look someplace else" while SMRA chimed in that "the combination of extreme recent
market volatility and the record auction size made for a terrible auction."
Speaking on Bloomberg TV, Guggenheim Partners CIO Scott
Minerd, who recently warned that the coming crash could
easily wipe out as much as 50% of the S&P, countered BofA's warning
saying that T-bills "aren’t a bad place to
be," given that there’s a lot of supply and
short-term rates "are fairly high."
And speaking of supply, there
is a lot of it coming: on Monday the Treasury sold 42BN of three-month bills
and $42BN of six-month bills on Monday; the size of the three- and six-month
tenors were each $3BN larger than prior sales, while the 52-week auction is $2b
larger than last month’s offering; the combination of settlements for Treasury bill and mid-month coupon
auctions is expected raise about $55 billion this week, however it is the
coming months that will see a tsunami of Bill issuance as the Treasury scramble
to refill its cash balance to $350 billion, meaning Treasury will have a boatload of short-term
securities to sell.
“Liquidity should dry up [this] week
as recent bill auctions settle on Tuesday, and Thursday’s bill and coupon
auction settlements raise a combined $34.7 billion,” Stone &
McCarthy analysts said.
While it remains unclear if the Fed
will have to step in and launch QE in the next few months to offset the plunge
in market liquidity, a few more "terrible"
auctions like today's 52-Week sale and Powell
may have no choice.
….
SOURCE: https://www.zerohedge.com/news/2019-08-13/terrible-52-week-auction-confirms-plunge-market-liquidity
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US
DOMESTIC POLITICS
Seudo democ duopolico in US is obsolete; it’s full of frauds
& corruption. Urge cambio
"...probably a broad base of Google employees that are ideologically super left wing, sort of
woke, andthink that China’s better
than the US..."
====
Biden is a Rep disguise of Dem..war-monger & neoliberal
as OB & convint-candi f Trum
Like a cross between Mr. Magoo and Homer Simpson, Biden’s verbal stumbles make many Dems cringe...
….
His chances of win inside Dems is zero. If he creates Rep-Dem party he
has Cha
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….
Give
it away, but 1st create insurance Comp for every brand. New owner
pay it
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There is no doubt we are
witnessing the last days of not just the Federal Reserve but the
entire welfare-warfare system...
….
….
I imagine 2 paths after death of neoliberal system: one to heaven; the other to hell. The heaven path is keeping the FED-Reserve but eliminating
the warfare system and expand the welfare to migrants who pay taxes. Of course
the neo-liberal system will be dismantled and their profiteers –riches be
confiscated. In other words : the private greed will be
eliminated and the PUBLIC NEED will be defended, with the support of
organized working classes in alliance with the middles classes and middle
investors inside the production sector.
The path to sweet hell for billionaires have two options. The 1st option to hell for
billionaires is: A-Decentralization of the
current FED-Reserve according the bankers-coalition in different regions. They can preserve the name of US-N1,
US-N2, US-N3 & so on… They can also
preserve the USD and the flag.
The path B to sweet hell is to
create a new Nation with new
flag & new currency. This option could
follow from the failure of A stage or go directly to B: new nations.
Both sweet hells are led by bankers and may have support for current rightist repulicans. The bankers will
be united by one single purpose: to avoid the confiscation of their money kept
in Fiscal paradise either in currency , gold or kyptos. That is: keep the PRIVATE GREED
and eliminate the “Public-need”.
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US-WORLD ISSUES (Geo Econ, Geo Pol & global Wars)
Global depression is on…China, RU, Iran search for State
socialis+K-, D rest in limbo
Avoid insane provocation.. We have nothing to get in China..
many things to lose
Our
Intelligence has informed us that the Chinese
Government is moving troops to the Border with Hong Kong.
Everyone should be calm and safe!
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The US is committing
insane war-provocation that could lead to WW3
A pair
of Russian Su-27 escorts drove
off the NATO F-18 jet dangerously close to Defense Minister Sergei
Shoigu's transport liner.
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SPUTNIK and RT SHOWS
GEO-POL n GEO-ECO
..Focus on neoliberal expansion via wars & danger of WW3
- ‘US Pressure on Turkey in Syria Could Have
Grave Consequences for Washington’ – Ex-Military Staffer
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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 ORG
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RT EN ESPANIOL
- China deniega una visita de dos buques de la Armada de EE.UU. al puerto de Hong Kong
- Trump no sabe por qué las protestas de Hong Kong se relacionan con una intromisión de EE.UU.
- Ganó el kirchnerismo y estalló la economía, ¿una reacción autoinfligida por Macri?
- El primer portaviones fabricado por China llevará 50 % más cazas J-15 que su predecesor
- Fotos de la NASA muestran la primera desaparición de un glaciar de Islandia, que no será la última
- Detectan un elusivo fenómeno tectónico que podría ser clave para predecir terremotos
- Keiser Report El mercado de deuda de hoy y la crisis de las puntocom
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COUNTER PUNCH
Analysis on US Politics & Geopolitics
Dean Baker Thoughts
on China’s Currency
James A Haught The
Biggest News of the 21st Century
Robert Koehler Dead Canaries
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DEMOCRACY NOW
Amy Goodman’ team
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PRESS TV
Resume of Global News described by Iranian observers..
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