ND
NOV 9 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
The top 10
percent of US families as a group directly owned over 93% of all stock and
mutual fund ownership.
Two weeks ago we pointed out that even as (or rather,
because) stocks hit daily all time highs, we now have mass public unrest (on
and off) in: France, Spain, Algeria; Iraq: Lebanon; Egypt; Russia; Hong Kong;
Venezuela; Chile; Ecuador; and Bolivia.
See Chart:
World of Unrest
The is a simple reason for this social anger: an
unprecedented wealth and income divide as a result of constant central bank
interventions in capital markets, which have made upward social mobility
virtually impossible and stagnant wage growth the norm, and nowhere more so than
in the US, where as Bloomberg
reports citing the latest Fed data, "one-percenters" now hold almost as much wealth as the middle-
and upper-middle classes combined, as a result
of the relentless ascent in stocks which added another $1 trillion in market
value in just the past week, bringing the total to $82.7 trillion.
See Chart:
World Stock Market Capitalization
Here are the facts: as the NBER recently reported, in 2016
the richest one percent of households held more than half of all outstanding
stock, financial securities, trust equity, and business equity, and 40 percent
of non-home real estate. The
top 10 percent of families as a group directly owned over 93% of all stock and
mutual fund ownership.
See Chart:
Moreover, despite the fact that almost half of all
households owned stock shares either directly or indirectly through mutual
funds, trusts, or various pension accounts, the richest 10 percent of households controlled 84 percent of the total
value of these stocks, though less than its 93 percent share of directly owned
stocks and mutual funds.
See Table:
And with the stock market soaring to new highs, it will
hardly be a surprise that the "top 1%" of American households have
enjoyed huge returns in the stock market in the past decade, ironically enough
using data from the Federal Reserve, which is directly responsible for this
unprecedented wealth distribution. And, as Bloomberg notes, "those fat
portfolios have America’s elite gobbling up an ever-bigger piece of the
pie."
In specific terms, this means that the very richest 1% had assets of about $35.4
trillion in the second quarter, or just shy of the $36.9 trillion held by the
tens of millions of people who make up the 50th percentile to the 90th
percentile of Americans -- much of the middle and upper-middle classes.
See Chart:
Commenting on this unprecedented wealth divergence that was
last observed a few years before World War II, Lakeview Capital's chief market
strategist Stephen Colavito said that people can’t get much of a return on
certificates of deposits and other passive investments, "so they’ve pumped
money into stocks and propped up the market overall."
Actually, the one who is
"propping up the market overall" is the Fed, which following a mini
repo market crisis sparked by JPMorgan launched "NOT QE", and
injected $280 billion in fresh liquidity in just the past two months, pushing
the Fed's balance sheet above $4 trillion for the first time since February.
See Chart:
FED Balance Sheet
At this point, wealth becomes a
feedback loop: "The wealthier that
the wealthy get, the more opportunity they have," Colavito said.
Their anger is only set to grow, because as Bloomberg notes it may not be long before "1-percenters" surpass the middle and upper-middle
classes combined. Household wealth in the upper-most bracket grew
by $650 billion in the second quarter of 2019, rising to $35.5 trillion, while Americans in the 50th to 90th percentiles saw a $210
billion gain.
See Chart:
One step below the top 1%, those Americans in 90th to 99th
percentiles, still control the biggest share of wealth, with $42.6 trillion in
assets.
What about the bottom end of US society? Well, if the super rich own almost all stocks, the "bottom 90%", i.e., 90% of the
entire US population, owns the vast majority of debt, some 72.4% of the total
pile.
See Chart:
There is one final twist: the wealthy vs poor conflict is
increasingly being drawn along age groups: Baby Boomers born between the end of the Second World War and 1964
currently hold wealth that was 11 times higher than that of millennials as of
the second quarter.
So how are millennials protesting this unfair age wealth
divide? Are they rioting, becoming political activists and voting in droves,
unionizing or participating in mass labor strikes? None
of the above: after all, even refusing to work is apparently too much
work; instead America's youth has flooded social media
with the pinnacle of passive-aggressive revolt in the form of the now
ubiquitous "OK
Boomer."
We doubt the Boomers are losing too much sleep over this
rebellion by the avocado toast generation.
….
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CTAs have
now shrunk their aggregate net long position in major DM government bond
futures (US, Japan, Germany, UK) by about 80% from the late August peak!
NOTE: A call to action (CTA) is a
marketing term that refers to the next step a marketer wants its
audience or reader to take. The CTA can have
a direct link to sales. For example, it can instruct the reader to
click the buy button to complete a sale or it can simply move the
audience further along towards becoming a consumer of that company's goods
or services.
See Chart:
In his latest note, which
we covered on Friday, JPMorgan Marko Kolanovic discussed how much higher he thinks 10Y yields can rise "before
they become a potential problem" for stocks (his answer: 150bps, although an even more important question is how
fast they get there, and lately they have been surging).
The JPM quant also explained why he
thinks stocks are primed to rise further from current levels: in short,
an unwind of the massive defensive "recession
is coming" trade that defined much of 2019, as active managers
rush to dump losers and scramble to make up for underperformance in the last 7
weeks of the year, in the form of a "chasing beta" rotation, to wit:
Our view is
that the best hedge for a continued unwind of this investment groupthink is to
overweight deep cyclicals like energy, metals/mining, as well as small cap
stocks.
See Charts:
While we discussed previously why we find issues with
Kolanovic's assessment that cyclical and value stocks are set to explode higher
at the expense of defensive/momentum names, here is an alternative take, one
from Nomura, which looks at 'the
main driver behind the main driver' of the recent stock market move,
so to speak.
As a reminder, the biggest catalyst for September's violent rotation out of
momentum/growth names and into value stocks was the sudden spike in Treasury
yields as the market repriced the
probability of a near-term recession. As such, it was the sharp move in yields
that catalyzed the quant crash of early September, resulting in the violent
reversal between cyclicals and defensives...
See Chart:
So looking at the role CTAs played in the sharp yield moves
of 2019, what becomes clear is that it was the aggressive build up of net long
positions by CTAs starting in September 2018 and culminating in September 2019,
before a violent reversal saw CTAs puke their long bond
positions, in the process crashing pure momentum portfolios...
See Chart:
Pure Momentum Index
.. as trend-following strategies
were clobbered as a result of the kneejerk moves in the 10Y Treasury Yield:
See Chart:
What happen next is in the first
chart above
Yet even as the forced liquidation of CTA bond net longs -
the primary catalyst behind the violent cyclical/defensive rotation - comes to
an end, the big question is what happens next: do they resume accumulating long
positions, or do they turn short.
Here Nomura points out that if the
last trigger line at around 2.05% (average cost of net buying since March)
gets knocked out, CTAs would be pressed not only into the final phase of
unwinding their TY long positions, but potentially moving net short, something
they haven't done since last summer. In that event, Nomura
estimates that the systematic selling pressure on bond futures could lift 10yr
UST yields well into the 2.0-2.5% range.
See Charts:
If that happens, then the violent
reversal of consensus trades predicted by Kolanovic will be fully in place,
resulting in a potentially shattering surge in value stocks (the question
whether any value funds are left to take advantage of such a move is worth
pursuing). After all, as we showed yesterday, the correlation between 10Y
yields and YTD consensus trades has never been more negative.
See Chart:
Here, we repeat the final point we made yesterday: since it
is the consensus trades that get crushed as yields and cyclicals rise and as
defensive stocks fall, hedge funds should
be praying that Kolanovic is wrong. Because
if he is right, 2019 will be another year in which the vast majority of hedge
funds not only underperform the market, but post negative absolute returns, and
find themselves out of a job.
….
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US
DOMESTIC POLITICS
Seudo democ duopolico in US is obsolete; it’s full of frauds
& corruption. Urge cambio
"The big issue in
the world today is war and peace, and we’re facing a campaign in 2020 where it won’t even be mentioned..."
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Rent
free... YES:
….
In a madhouse the maniac Trump may rest for the rest of his life
….
A group of medical professionals who claim that President
Trump is mentally unfit for office want to testify during House Democrats' impeachment probe,
according to the Washington
Examiner, the latest development in an ongoing effort to explore
removing Trump via the 25th amendment.
"We think that hearing about mental health
aspects in the context of the impeachment hearings is critical, partly because,
for the past 2.5 years we have been very deeply concerned about MENTAL INSTABILITY of the president, and
pretty much all that we have said has born out to be true," said Lee - who previously diagnosed Trump with
a "mental impairment" for "going back to conspiracy theories, denying things he
has admitted before," and "his being
drawn to violent videos."
….
….
RIP Trump ..
You have no chances of winning the election.. Even if
buying election and electronic -fraud machines work for you: You have no
chances of governability:
1- Your
inability to put across new plans is clear: you’re losing wars & US
soldiers abroad and that waste of money & life nobody will tolerated any
longer.
2- The
economic crash in process will put millions in streets demanding your resignation.. State
Referendums may open the door for
regional separatism (big Corp & bankers will push for it) and CIVIL WAR will start.
3- With
high social conflicts and not chances for PEACE, you have no ROOM FOR
LEGITIMACY.
4- The
cohesion of your political party & social-class will be dissolved (signs of
internal division are already clear).
5-
You have not chances for confidence and trust, not inside & mush less abroad).
6- The Worse will happen if you declare WW3.. our Nation do not have
bunkers to hide & get protection from outside bombing, only the rich have
it and you & your family will be the target of the fury of our Nation.
7-
Governability depends on Legitimacy that
you don’t have. Electoral fraud won’t add
any legitimacy (instead , it will create the basis for civil war).
Governability depends on decisional efficacy & the economic chaos coming
will destroy the rest. Govnty also depends on internal political cohesion and
institutions & key players of “deep-state” are against you. Presid Trump
the best thing you can do for our Nation is RESIGN
for health reason. Get support from your medicals and follow their
prescriptions. In Polit terms you’re already
death Presid Trump.
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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
Capitol police say they “will take every measure possible to make sure we don’t have another conflict
like we had the last time.”
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SHOOTS ARE COMING..
"US forces may also stay with that effort for years to come..."
….
Opium dreams!
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SPUTNIK and RT SHOWS
GEO-POL n GEO-ECO ..Focus
on neoliberal expansion via wars & danger of WW3
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NOTICIAS IN SPANISH
Lat Am search f alternatives to neo-fascist regimes &
terrorist imperial chaos
REBELION
ALC:
Rebeliones populares. ¿Y después? Marcelo
Colussi
ARG: Rebeliones populares. ¿Y después? Marcelo Colussi
Libro-L: GOB progresistas y debates en la izq latina Edgardo Lander
Mund: Xi a Brasil profundizará asociación entre miembros de BRICS
Mund: Xi a Brasil profundizará asociación entre miembros de BRICS
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ALAI ORG
BLOCKED
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RT
EN ESPAÑOL
Impresión nueva
no capturable para mi reporte
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FABULAS DE LA FONTAINE
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NAZANIN
ARMANIAN
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GLOBAL RESEARCH
Geopolitics & Econ-Pol crisis that leads to more
business-wars from US-NATO allies
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