martes, 14 de enero de 2020

ND JAN 14 20 SIT EC y POL



ND  JAN 14 20  SIT EC y POL 
ND denounce Global-neoliberal debacle y propone State-Social + Capit-ompet in Eco


ZERO HEDGE  ECONOMICS
Neoliberal globalization is over. Financiers know it, they documented with graphics



Increased concentration risk is a clear sign of fragility increasing and the system is destabilizing underneath the surface. It’s historically a recipe for violent moves so it should definitely be on investors’ radar.
The rapid rise of the large US technology stocks has catapulted the five largest stocks on market value to reach an index weight of 18%, the highest level observed in the S&P 500 in 25 years. Increased concentration risk is a clear sign of fragility increasing and the system is destabilizing underneath the surface. It’s historically a recipe for violent moves so it should definitely be on investors’ radar.
See Chart:
Share of Top 5 Companies in the S&P 500:  Market gap vs. Net Income

See more Charts at:
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The US market's price-to-sales ratio has reached a new record high (but it's different this time)...
See Chart:
S& P 500 Price-to- Sales

And its PEG ratio has also never been higher...
See Chart:
PEG ratio (PE/LT  EPS Growth )

Nomura's Charlie McEllligott lays out what is holding this malarkey toegther...
  • “perpetually easy” US financial conditions make this an “everything rally” environment for investors, where risk assets / spread product should be supported by “firm” USTs over the course of 2020 (as I do not see scope for a large US Rates selloff as some are expecting, nor a massive rally for that matter)
  • “Goldilocks” US economic backdrop with benign inflation
  • Fed reaction function clearly skewed asymmetrically (super-low bar to ease, almost impossible bar to hike)
  • My belief that the current “QE-Lite” (in that the Fed are NOT buyers of “Duration,” just short-term Bills) will transition to standard “QE” over time, moving toward towards USTs / outright “Duration” purchases in an effort to provide “ample” reserves in the banking system and offset money market stress points
  • Long-term view from investors that the “Three D’s” will continue to create secular disinflation which makes will keep policy “easy” and rates “low”—the overall 1) trajectory of Debt growth, 2) fading Demographic impulse and 3) tech Disruption.

And positioning in options is extreme to say the least...
See Charts:

And the market keeps rising on the back of the biggest 2-day short-squeeze in 2 months...
See Chart:
“Most Shorted”  Stocks

For a few brief minutes today, the machines hiccup'd on China tariff headlines... but that didn't last... until NYFed reduced the size of its repo plans and that dipped stocks again (briefly)...  S&P and Nasdaq dared to close red!
See Chart:

Credit markets are (for once) leading the shift in protection costs higher (even if VIX was also higher today)...
See Chart:

Despite the gains in stocks, bonds were also bid with Treasury yields down 2-3bps (short-end underperformed)... Today's rally erases yesterday's losses...
See Chart:

And the yield curve flattened to almost one-month lows...
See Chart:
UST 2S 10S  Yield spread

The B-Dollar trod water for a 4th day...
See Chart:

And finally, in case you wondered when this malarkey would end, Morgan Stanley's Global Risk Demand index soared to +2.3 - above 2.00 has historically been a significant turning point for risk...
See Chart:

THIS WON'T END WELL..
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In 2020, increasing monetary and fiscal stimulus will be the equivalent of spraying gasoline on a fire to extinguish it...
The problem is that these policies create distortions that cannot be fixed with more of what caused the distortions in the first place: more extreme monetary and fiscal stimulus.

Systemic distortions include:
A. Soaring wealth-income inequality across the entire global economy.
See Chart:
Relentless 50 years decline in wages’ share of the ECON’ total income

B. Dependence on asset bubbles to generate the "wealth effect" that encourages spending by the top 5% who own two-thirds of the assets bubbling higher.
See Chart:
Relentless rise of financialization & soaring wealth vs. Income Inequality

C. Dependence on asset bubbles to generate capital gains and property tax revenues for state/local governments.
D. Loss of cost discipline: the solution across the entire spectrum--government, corporate and household--is now to borrow more, not trim costs via innovation or increases in productivity and efficiency.
E. Reliance on debt to fund spending leads to rising defaults which will collapse the system. (Soaring auto-loan defaults are the canary in the coal mine.)
F. Zero interest rates have generated over-capacity/over-production as everyone seeks a return on capital by expanding market share. Now there are global gluts in everything from autos to natural gas to electronics.
G. With the yield on savings now less than zero due to inflation, investors must gamble in the asset-bubble casino as this is only available way to earn a return.
H. Buffers are thinning. I've discussed this in depth over the years; dependence on stimulus lowers systemic resilience, rendering the entire system increasingly vulnerable to a phase-shift that fatally destabilizes the system.
I. Prior to the 2008-2019 era, the "real economy" of sales, wages and profits led the stock market. Now the stock market dominates the real economy, as the central banks have turned the stock market into the 'signaling device' that all is well and the source of bringing demand forward (i.e. the wealth effect).
In Mohammed El-Erian's words: "The Fed can't pull back because it's worried it will disrupt markets that can be a spillover on the economy. The Fed's in a lose, lose, lose situation, they can't stay where they are, they can't do more, they can't do less."
In Andy Xie's words: "The Fed has gone from the financial bubble's hostage to its guardian."
J. There are limits on encouraging more borrowing by lowering interest rates to zero. Even at zero interest rates, income must be devoted to paying principal. At some point, all available income is already consumed in debt service. Anecdotally, we're already there: zombie corporations (that only survive by increasing their debt loads) are becoming more numerous, and households burdened with student loans, auto loans, credit cards and mortgages cannot afford more debt even at zero interest.
Policy makers are now trapped. Unable to reverse the policies that have created the distortions lest that crash the system, they only have two responses, neither of which actually address the distortions undermining the system:
1) push extremely distorting policies to new extremes, or
2) attempt policy-tweaks--higher taxes on the wealthy, etc.--that ignore the causes of the distortions. These policy tweaks are the classic "band-aids treating cancer."

In 2020, increasing monetary and fiscal stimulus will be the equivalent of spraying gasoline on a fire to extinguish it. These two charts summarize the disastrous consequences of permanent monetary stimulus: wages' share of the economy are in relentless decline, while the equally relentless rise of financialization has generated soaring wealth / income inequality that increasingly threatens to rip our society and economy to shreds.
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Good economic news over the last couple months belies the fact that a recession could strike as soon as March 2020...
See Chart:
Citigroup U.S. Surprise Index: 4 month span, data through 01/10/2020

Placing the recession
See Chart: 

There are a few conclusions to this.
  • First, five recession indicators have signaled.
  • Second, there is nothing unusual in the timing that the recession hasn’t started yet.
  • Third, no matter which of the five indicators you use, a recession will likely begin in 2020 and the average center-point of the indicators is in March, just a little over two months away.

Don’t confuse the Fed’s “on-hold” stance to have any more meaning than the hope that the consumer and labor market’s strength will continue. History suggests that this is not a good bet to make.
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RELATED:
The Fed once was an insurance vehicle for the economyNo longer... Now that they see themselves as the permanent intervener in everything...
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More on ‘everything is awesome’:

After 5 straight down days, oil managed modest gains today but gave some of that back after API reported a surprise crude build and major product inventory increases...
WTI hovered around $58.40 ahead of the data, and dropped ‘modestly’ on the surprise build...
See Chart:

"Unfortunately for the bullsthe fundamental outlook over the first half of this year is not overly constructive. The market is set to see a sizable surplus, which should mean weakness for both the flat price and time spreads," said Warren Patterson, head of commodities strategy at ING, in a note.
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US  DOMESTIC POLITICS
Seudo democ duopolico in US is obsolete; it’s full of frauds & corruption. Urge cambio


"The system cannot work without leverage, but a system with too much leverage is unstable."
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Is this another Trump bla-bla? 
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Trump’ tyranny has not limits: after peeing FBI ask them not flush toilet
"A 5 and a 7? You can absolutely get into that."
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Does it apply to the Commander in chief of Imperial terrorism?
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Is this Trump directly targeting Mike Bloomberg's golden goose?

See Graph:
Lockup  How one Fed Agency & the Labor Dept  releases ECON reports
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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


And a separate attack against police in northern Iraq suggests  [our] ISIS is popping up again...
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The two were at an ancient site connected with Paul's conversion when Assad offered: "IF TRUMP ARRIVES ALONG THIS ROAD, HE WILL BECOME A GOOD MAN."
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Is Schizophrenia contagious?  Or is this another theatrical bla-bla?

As most experts laugh it off, Goldman sees a way for China to boost imports from the US by $200 billion.
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Yesterday : RU-Chi are our enemies. Today this. What about Tomorrow?
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"There is a reason Stalin had Gulags"
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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

Guate-peor:  Un negocio muy privado  Carolina Vásquez
Brasil:  El Brasil de Bolsonaro  Eric Nepomuceno
Coreas   Dificil unificar dos mundos antagónicos  Eduardo García
México   Yucatán y la usura sinuosa  Cristóbal León
España   Faquires e impacientes   Lluís Rabell
US:    Trump cava su propia sepultura  Rodolfo Bueno
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ALAI NET ORG

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RT EN ESPAÑOL

Trump contra Apple: "Siempre los ayudamos y hoy nos niegan acceso a los móviles de asesinos y narcos" Que lo pida un Juez, no un asesino. https://actualidad.rt.com/actualidad/339920-trump-arremeter-apple-negar-acceso-moviles-asesinos-narcos
Trump: "Dejé tropas en Siria para controlar el petróleo, y debíamos haberlo hecho en Irak también"  https://actualidad.rt.com/actualidad/339929-trump-dejar-tropas-siria-controlar-petroleo-irak  Ahora les toca salir como perros  con la cola entre las piernas
Atacan con misiles la base militar de Taji, que alberga tropas USA.  https://actualidad.rt.com/actualidad/339894-reportan-misil-caer-base-militar-irak-taji-eeuu
Sistema de defensa antiaérea siria repele ataque de ISR en la provincia de Homs   https://actualidad.rt.com/actualidad/339908-reportar-sistema-defensa-antiaerea-siria
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INFORMATION CLEARING HOUSE
Deep on the US political crisis: neofascism & internal conflicts that favor WW3

-The World Must End The US’ Illegal Econ War  By Kevin Z and Margaret F 
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COUNTER PUNCH
Analysis on US Politics & Geopolitics

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GLOBAL RESEARCH
Geopolitics & Econ-Pol crisis that leads to more business-wars from US-NATO  allies

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DEMOCRACY NOW
Amy Goodman’  team

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ASIAN NEWS
Press TV

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