MAY 17 20 ND 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
"Central-bank support is key in the massive bond buying we’ve seen
for now. But if they blink then at some point, in the medium term, it will all
likely unravel..."
….
There was this exchange that
deserves to focused on:
Scott Pelley: Fair to say you simply flooded
the system with money?
Jerome Powell: Yes. We did. That's another way
to think about it. We did.
Scott Pelley: Where does it come from? Do you
just print it?
Jerome Powell: We print it digitally. So we-- you know, we-- as a central
bank, we have the ability to create money digitally and we do that by buying
Treasury Bills or bonds or other government guaranteed securities. And that
actually increases the money supply. We also print actual currency and we
distribute that through the Federal Reserve banks.
To give Powell the credit, at least
he was being somewhat honest: unlike Bernanke who
claimed the Fed does not "print" digital bills, Powell no longer felt
compelled to make the obvious lie. And judging by the ongoing surge in gold and
silver overnight, the market seems to appreciate Powell's honesty.
SEE CHART:
Last week, the
Treasury shocked the world when it announced that in the current quarter (the
3rd of the fiscal year), the US will need to sell a mindblowing, record $3
trillion (pardon, $2.999 trillion) in Treasurys to finance the US money
helicopter.
SEE TABLE:
This, after
selling $807 billion in the first half of the fiscal year, and another $677
billion in the quarter ending Sept 30.
And since it is just a matter of
time before Congress has to pass yet another
fiscal package which will be at least another trillion dollars, and up
to $3 trillion if the Democrats get their wish, one can say that Guggenheim's
projection of over $5 trillion in debt issuance this calendar year will be
wildly conservative.
SEE CHART:
Next,
Goldman estimates this so-called free float, defined as the amount of sovereign debt outstanding less central bank and
foreign official holdings, across major DM markets, and shows it in the
chart below. Through the end of last year, free float was on a downward
trend in Germany and Japan, as ECB and BoJ purchases absorbed the bulk of new
supply. In contrast, free float had been trending
higher for much of the year in the US and UK.
SEE CHART:
Bizarrely, a similar picture
emerges in Japan where even the always ravenous BoJ is expected to absorb a
large portion (about ¥25tn) of incoming supply in the upcoming year as Japan is boosting its debt sales by 18.2 trillion yen ($170
billion) to fund a spending package equivalent to a fifth of its annual
economic output; but according to Goldman, the scale of supply is likely to
exceed even the BOJ's QE purchases.
SEE TABLE:
Incidentally, we first warned about the urgent need for the Fed to
aggressively step up and boost its QE (instead of continuing to taper it by $1
billion week after week as it did again today) on
Wednesday when we quoted Curvature Securities' rates strategist and
repo expert Scott Skyrm, who calculated that "there
are $689 billion net new Treasurys settling during the month of May and $992
billion net new Treasurys settling between now and June 15. Yes, almost one
trillion new Treasury securities hitting the market within the next month!"
SEE CHART:
Net
Treasury Issuance
His conclusion: "That means
the market needs to come up with about one trillion dollars to pay for those
securities over the next month." Which, of course,
is a euphemism because we all know who in the market needs to come up with one
trillion dollar - the only one who literally prints money: the Federal Reserve.
Conveniently, Goldman's argument
allows us to recycle our conclusion from two days ago, in which we said that
here is the layman's version of what was just said: "the Fed has flooded the system with
liquidity... and it is not enough, because the way helicopter money works, is
that liquidity supply (the Fed), and liquidity demand (Treasury via debt
issuance) go hand in hand, and periods of too much supply, as was
the cash with the Fed's massive QE in late March and early April, are promptly
followed by periods of dramatic liquidity demand, such as the next month when
$1 trillion in liquidity will be drained to fund the US government "money
helicopter."
Goldman's own calculations suggest
that the shortfall net of the Fed's ongoing QE tapering could be as much as
$1.6 trillion.
As a result, Powell faces a two-fold problem: since the Fed chair has
taken negative rates off the table, Powell has no choice but too boost QE again, and unleash another firehose
of debt monetizing liquidity in the financial system. However, any such reversal to
the Fed's current posture of shrinking QE will be met with howls of rage,
especially among what's left of the conservative political establishment.
The only
question we have is whether this will be the market crash that
the Fed uses to unveil it will also buy equity ETfs next, or if Powell will
save this final bullet in its ammo for whatever comes next.
Finally, Bloomberg reached the same
conclusion, and in "An
$8 Trillion Spree Sets Clock Ticking for Bonds’ Judgment Day" in which
it wrote that "investors are mopping up the sales as long as central banks
engage in so-called quantitative easing, buying an unlimited amount of debt to
counter the ravages of the pandemic. But at the first whiff of a recovery, or a pullback from policy makers,
all bets may be off. Throw in the threat of
inflation amid a global fiscal splurge exceeding $8 trillion, and bond
investors look set for a toxic cocktail of risks in the not-too-distant future."
SEE CHART:
Quantitative
Easing
"Can governments continue to borrow at such record levels?
No," said George Boubouras, head of
research at hedge fund K2 Asset Management."Central-bank support is key in the massive bond buying we’ve seen
for now. But if they blink then at some point, in the medium term, it will all
likely unravel - with unforgiving consequences for some countries."
Ironically, this also means that an end to the coronavirus crisis is the worst
possible thing that could happen to a world that is now habituated to
helicopter money and virtually unlimited handouts, which however need a state of perpetual crisis.
That, incidentally, would be the endgame for the current monetary regime, which
is why anyone hoping that officials, policymakers and the establishment in
general, will allow the coronavirus crisis to simply fade away, is in for the
shock of a lifetime.
….
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The S&P
500 may be the world’s most-followed passive index but COVID-19 and its
aftermath is going to force its constructors into some very active choices
- There are now many companies that fall well below S&P’s current $8.2 billion market cap requirement for initial inclusion in the 500. Alaska Air, which was just added in 2016, is valued at $3.5 billion, for example. Apparel maker PVH has a market cap of $3.1 billion, as does iconic brand Harley-Davidson.
SEE CHART:
The bottom line on this point: the
S&P committee is going to have to decide how long they want to wait before
ditching COVID-damaged companies from the 500, and there are certainly enough
to allow them to dramatically remake the index if they so choose.
The sorts of companies that can post a 4-quarter profit in a post-COVID
world are very different from those which might have had a chance before the
outbreak.
SEE CHART:
Tech Takeover
The bottom line: as S&P considers what to add
to the 500 this year, it may well use the opportunity to add non-Tech names and
nibble away at that sector’s preeminence. Finding profitable firms, however, will be more challenging
than any time since 2008/2009.
Pulling this all together: the S&P 500 may be the world’s
most-followed passive index but COVID-19 and its aftermath is going to force
its constructors into some very active choices. Based on existing
financial requirements (profitability) and an already top-heavy (with Tech)
portfolio, there is a good chance important disruptive companies will not make
it in. How that changes the S&P’s long run return potential remains to be
seen, but history is clear on the fact that returns
come from disruptive companies first and everything else a very distant second.
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...there is no such thing
as “LIVES OR THE ECONOMY”...
The figures of deaths and infection risk prove the
mistake of a generalized lockdown. Destroying the economy is a very bad
experiment when the average mortality by age group shows a minimal impact on
citizens of 70 years of age or less.
America does not need more trillion dollar
bills. It needs less political interventionism.
====
US
DOMESTIC POLITICS
Seudo democ duopolico in US is obsolete; it’s full of frauds
& corruption. Urge cambio
'MOST ISOLATED PERSON ON PLANET': SAILOR
EMERGES AFTER 9-MONTH SOLO TRIP TO FIND COVID-ALTERED WORLD
Initially they said, “You can’t come here,” so I was like, “Where am I gonna go, right,”...“I was the most isolated person on the
planet, they didn’t want to let me in.”
….
All the system has changed but not the owners
of our system. The experiment COBID-19 was designed for a war Agst China, but did
not happen. The war was postponed by NATO-PENTA
. Soldiers were infected & spread this pandemia in Europe and worldwide. The
WW3 was postponed but we continue infecting
the world with poison emissions from wars & drills. We continue
producing arms & drills, it may super-rich the corp form the MIC and the private
Corp from WS who do speculation & profit with QEs & Bailouts. WTO and
internat judicial centers are been muted
& threatened.. OUR FUTURE IS UNCERTAIN.
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As the rate
of new infections is slowing, concerns emerge about a second wave of the
coronavirus pandemic. As
JPMorgan's MW Kim writes, China and South Korea are in
the stage of full “recovery” from the first infection curve as 99.9%/ 91% of
cumulative infections have been removed from the infection pool.
SEE CHART:
Based on both the bank's
conservative assumptions and epidemiologist observations, a full removal of COVID-19 would be almost impossible until
the vaccine is available to the larger public. This suggests that increasing human
mobility/ business activities would pose the risk of a second wave outbreak by
way of faster transmission rate increase.
SEE CHART:
Based on JPMorgan's
assessment, Korea looks to be
entering into the stage of second wave as new infection growth looks faster and
larger scale. Therefore, the bank introduces the
second curve forecast into its existing epidemiology modelling in Korea.
SEE CHART:
Separately, China’s new infection
trend post the test outcome of China’s Wuhan city will also be closely watched
by JPMorgan. As MW Kim notes, "as we factor this potential risk under the
pessimistic scenario in epidemiology modelling in China, should there be a
greater number of infections monitored, we would consider plugging this
fine-tuning into the pessimistic scenario." That
said, he notes that "the second infection wave could be smaller scale in
terms of total infections, mortality rate, and having a shorter period from
infection to recovery. This is due to the government having experience
from first wave infection management and the public
largely being aware of potential infection risks with experience of social
distancing."
….
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"It may take a while. It may take a period of time. It could stretch
through the end of next year [before things get back to normal]. We really
don't know."
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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
Tehran
warns any US attempt at intercepting its fuel tankers "would have
serious repercussions for the Trump administration ahead of the November
elections."
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US &
China inside Israel are essentially in a state of behind-the-scenes diplomatic war after
Secretary of State Mike Pompeo's visit there last week...
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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
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ALAI ORG
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RT EN
ESPAÑOL
Crear chivo expiatorio y ganar guerra comercial:
motivos d de "campaña anti China" d US . https://actualidad.rt.com/actualidad/353283-eeuu-campana-mediatica-china-presion-guerra-comercial
Reserva Federal: EE.UU. evitará una nueva depresión
pese a la pandemia https://actualidad.rt.com/actualidad/353477-eeuu-asegura-evitara-depresion-pese-pandemia
El mundo debe unirse" para obligar al US a
abandonar xenophia https://actualidad.rt.com/actualidad/353474-pompeo-imponer-costos-china-coronavirus
Farmacéutica US dice tener un anticuerpo que impide
al CV afectar células "en 100 %" https://actualidad.rt.com/actualidad/353407-empresa-afirma-encontrado-anticuerpo-bloquea-covid
Exdirector OMS: "Es posible que el virus se
queme naturalm antes de que haya vacuna" https://actualidad.rt.com/actualidad/353459-oncologo-coronavirus-desaparicion
"Ni siquiera fingen estar a cargo": Obama
critica respuesta US ante la pandemia https://actualidad.rt.com/actualidad/353448-siquiera-fingen-estar-cargo-obama-critica-respuesta-eeuu-pandemia
'Hackers' publican "trapos sucios" de
Trump tras exigir rescate de 42 mill de dólares
https://actualidad.rt.com/actualidad/353451-hackers-publican-trapos-sucios-trump-rescate
La OMS advierte de otra ola mortal de covid-19 en
Europa https://actualidad.rt.com/actualidad/353420-oms-segunda-ola-coronavirus-europa
"No queremos chinos": dice restaurante
alemán que reabre puertas e incendia la Red
https://actualidad.rt.com/actualidad/353430-chef-restaurante-aleman-comentario-racista-indignacion
Trump usa la pandemia para debilitar y "restar
capacidades económicas de China" https://actualidad.rt.com/video/353461-analista-trump-pandemia-debilitar-restar-capacidades-china
Trump, bajo crítica por insistir en reapertura de la
economía del país https://actualidad.rt.com/video/353460-trump-critica-insistir-reapertura-economia
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CROSS TALK https://www.rt.com/shows/crosstalk/
We speak to
world-famous primatologist and conservationist Dr Jane Goodall. She discusses
how coronavirus has been brought about by our disrespect of the natural world
and animals, how deforestation is increasing the number of zoonotic diseases,
the effectiveness of animal experimentation for developing vaccines,
capitalism’s role in climate change and more!
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In one of
the most resonant political speeches of the 20th century, Franklin Roosevelt
told an anxious United States and a stricken world that “the only thing we
have to fear, is fear itself.” Jump to the present day and that fear –
nameless, unreasoning, paralyzing – is still in the air and many blame the
media for it. Is the charge justified? To discuss this, Oksana is joined by
Karin Wahl-Jorgensen, director of research development and environment, Cardiff
School of Journalism, Media & Culture.
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While
unemployed Americans and failing businesses look to Congress for help during
this pandemic, Nancy Pelosi supports using federal funds to bail out K Street
lobbyists. Also, Joe Biden is enlisting the help of certain Republicans in his
campaign to unseat President Trump. Then, United Airlines faces a lawsuit over its
plans to reduce employees’ hours.
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GLOBAL RESEARCH
Geopolitics & Econ-Pol crisis that leads to more
business-wars from US-NATO allies
-Video:
Google Manipulations of Votes in Elections. By Doctor
Robert Epstein, Senate Testimony and Senator Ted Cruz
-Video:
Syrian Army Suffers Casualties in Daraa. Militants Attack Russian-Turkish
Patrol By South Front,
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