JUN
7 ND SIT EC y POL
ND denounce Global-neoliberal debacle y propone State-Social
+ Capit-compet in Eco
FEDERAL DEBT IS SOARING
America (and the world at large) are in the midst of an entirely predictable demographically-driven
crisis, between an economic/financial system requiring infinite growth
and a very finite human/physical world...
Federal debt is soaring absent the
economic (and tax revenue) growth to accompany this deluge of debt.
I will show that the
primary purchasing sources of that debt have turned to net sellers...and that
into this breach, the Fed has thrust itself as the buyer (counterfeiter) of
last resort.
The result is likely to be a Minsky Melt-Up...and then the fall that typically
follows.
First, by
year end 2020 (estimated below), federal debt will almost surely cross $28
trillion while GDP will collapse in Q2 with likely recovery through
Q3/Q4.
The outcome will be a debt to GDP
ratio likely around 140%...smashing the WWII previous high water
mark.
Noteworthy also in the chart below are the
new standards of ZIRP and reliance on the Federal Reserve balance sheet (QE) to
maintain zero percent interest rates.
SEE CHART:
Since 2008, public (marketable)
federal debt has nearly quadrupled, up by $14.7 trillion. Social Security
and like Intragovernmental trust fund holdings have risen $1.8 trillion.
The Federal Reserve balance sheet has increased by 8x's, up by $6.3
trillion. In fact, most simply, it is the Federal Reserve using it's
balance sheet as the substitute for the demographically decelerating IG purchasing.
As the IG holdings will only continue to decline due to
the unfunded liabilities (and with it the primary source of Treasury buying for
decades turns to a decade of Treasury selling), the Fed's balance sheet will
rise inversely to avoid an interest rate Armageddon.
SEE CHART:
To underscore the Fed's role as
buyer of last resort, below are the four classes of Treasury
buyers/holders. I split the change in holdings by group, per period:
·
2009 through '14...the
QE years (everybody buys...especially Fed, Foreigners)
·
2015 through '19...the QT years (IG and
especially domestic sources do the buying, Fed sells, foreigners pass)
·
January through May,
2020...the p(l)andemic 5 months (IG sells, foreigners pass, Fed goes wild w/ a
domestic assist (unfortunately, Treasury Bulletin for 2020 won't be available
for a while to detail who exactly those domestic buyers of 0.6% yielding 10
year and 1.2% yielding 30 year bonds were))
SEE CHART:
And the Fed is communicating they
will continue to slow their purchasing.
Chart below shows the Fed balance sheet (red line) and weekly change (black columns)
since 2008. I assume the Fed will continue tapering their purchases
through year end 2020, ending the year with a balance sheet of something like
$8.3 trillion (adding about $4.5 trillion since QT ended in September 2019, or
a 220% increase of it's balance sheet in 15 months time).
SEE CHART:
The Fed truly distorted the
interest rates of Treasuries with it's massive purchases in such a short
period. Given the duration and laddering of bonds, only a relatively
small percentage is available at any certain time so the size and suddenness of
the Fed purchases overwhelmed the Treasury market.
T-Bills
During QE Corona-Virus, the Fed has
thus far purchased $587 billion in T-Bills...in fact even this week, the Fed did most of its ongoing buying here, adding an
additional $33 billion in T-Bills (effectively further steeping the curve
between short and long duration rates).
SEE CHART:
Continue reading see more CHARTS AT{
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ZERO HEDGE ECONOMICS
Neoliberal globalization is over. Financiers know it, they
documented with graphics
...a bounce like the one we have seen only means that the rate of deterioration is slowing
down, not that there is a recovery. All sectors remained deep in contraction...
….
….
The recent improvement in global PMIs and especially in employment in the
United States have created a strong optimism in markets about the recovery.
SEE CHART:
US
employment :Total IN Labor Force SA
However, it is important to be
cautious about a V-shaped recovery when the leading indicators remain weak.
Eurozone PMIs (Purchasing Managers’ Index) came slightly above
expectations in May, but remained in deep contractions both at the composite,
manufacturing and services level.
SEE CHART:
We must remember that a bounce like
the one we have seen only means that the
rate of deterioration is slowing down, not that there is a recovery. All
sectors remained deep in contraction in May, but almost with slower rates of
decline.
SEE
VIDEO: https://youtu.be/2w6cQepLlSA
At the
global level, output indices rose from record April lows but still indicate a
significant reduction in activity, led by Travel & Leisure and followed by
transportation as well as Healthcare services, all showing record drops,
according to Markit PMIs.
SEE CHART:
The United States’ job data for May
was a strong positive surprise. However, the Bureau of Labor Statistics admitted it
accidentally miscounted 4.9 million laid-off people as employed, bringing
unemployment to 16.1%, which is still much better than the 19% figure estimated
by consensus, but not as strong an improvement as the headlines suggested.
The main reason why we should remain cautious is because we now have evidence that Chinese activity has recovered at a
slow pace, particularly in those sectors that are not supported by government
spending plans.
Unemployment will be key to regain optimism about
the recovery.
When
we see developed economies recover the levels of job creation and employment
rates seen prior to the Covid-19 crisis, we may have confidence in a stronger
improvement in consumption.
However, it is now clear
that even in dynamic and strong economies like the United States, it will
likely take between 8 to 10 months to recover the full level of employment seen
in February. In The eurozone, this delay will likely be longer, up to 24 months.
Wages and savings are also key to believe in a rapid recovery. With the recent collapse of economic capacity
utilization and the rise in inventories, it is hard to
believe in a capital expenditure-led boost of the economy.
Until September we will
not be certain if the recovery is real. Most of the positive data until then
may just be rises due to the base effect of a very poor April.
….
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The issue at hand is the markets
have priced in a “V-shaped” recovery which is well ahead
of what the economic data suggests. Such was seen in Friday’s employment report fiasco...
A Note About That Jobs Number
On Friday, the Bureau Of Labor Statistics
released the widely expected employment report for May. Despite continued
weekly jobless claims over the last month exceeding more than 8-million, the
BLS reported an increase of more than 2.5 million jobs in May.
The unemployment rate came in at just 13.3% well below the
consensus estimates of 17-19%.
Both of these numbers were historical records
surpassing any period back to the “Great Depression.”
Let’s start by taking a look at the raw
numbers from the BLS.
SEE CHART:
Unemployment by the Numbers
From May 2019 to May 2020:
·
The civilian population grew by just 1.186
million. (This is a historically slow growth rate for the population
which speaks to the demographic problem.)
·
The labor force shrank by 4.555 million. (We
assume these people no longer want to work.)
·
The number of employed individuals fell by
19.602 million.
·
The number of unemployed persons rose by 15,047
million.
Again, these are numbers never before seen in
history.
Importantly, the drop in the unemployment rate
is due specifically to the substantial drop in the labor force. Since
February, 6.3 million people have decided they no longer wanted to
work, according to the BLS. Such is substantially more than would be expected
even based on the large increase in unemployment.
Therefore, if we adjust for the labor force,
and count the extra 4.9 million people who were “not
at work for other reasons,” the “realistic unemployment rate” was
17.1 percent in May.
….
Continue reading & see more charts at:
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"The
Fed could be faced with a firm "market force” if they don’t lock down the
yield-curve on Wednesday."
SEE CHART:
See more interesting charts at:
SOURCE: https://www.zerohedge.com/markets/sudden-sharp-spike-yields-will-cause-stock-market-correction
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Hedge funds
finally threw in the towel.
This is
stunning.
At the peak of speculative fervor
in February, small traders bought to open 7.5 million call contracts.
This week,
they bought 12.1 million. Watch what people do, not what they say. They're
full-bore bullish, on steroids.
SEE CHART:
Speculation
run rampant
220 YEARS
OF DOW/GOLD RATIO
SEE CHART:
Surprising
US job numbers creates risk: distraction & complacency. Don’t lose thread.
Econ is experiencing an epic collapse of demand.
“There’s a lot of denial here,
as there was in the 1930s,” said Eric Rauchway, a historian at
University of California. https://nytimes.com/2020/06/06/upshot/coronavirus-economic-crisis.html?smid=tw-share
SEE CHART:
In its
latest weekly exposure report, Goldman's prime desk notes that while overall
hedge fund gross leverage fell -2.5 pts to 247.1% (96th percentile one-year),
net leverage rose +1.0% to 75.0%, the highest level in over two years.
SEE CHART:
https://www.zerohedge.com/s3/files/inline-images/HF%20net%20exposure%20june%202020.jpg?itok=UDEdLhaj
This
happened with hedge funds scrambling to cover even more shorts as the MSCI
World Index increased +3.3%; as a result the GS Prime Brokerage Book was net
bought driven by short covering
outweighing long selling in a 2.4:1 ratio, confirming what Citi
said recently that much if not all of the
recent rally has been driven by short covering.
….
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"The U.S. dollar’s days
as the world’s reserve currency could be numbered,with some of the
biggest ever changes to government-backed central bank currencies looming - and China leading the field."
Recent
performance of the dollar (DXY) could be
revealing that Goldman Sachs is off to a good start with their bet:
SEE CHART:
US D Index and
50 days Moving average
Letter Potential “Nightmare” for the U.S. Dollar
Right now, the main currency in
China is the yuan.
That may change, however, as there have recently been indications that it
may be phased out and replaced by a Central Bank Digital Currency (CBDC).
And thanks to the COVID-19 outbreak, this
process has accelerated,
according to a recent Forbes article:
The U.S. dollar’s days as the world’s reserve
currency could be numbered, with some of the biggest ever changes to
government-backed central bank currencies looming - and China leading the
field.
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US
DOMESTIC POLITICS
Seudo democ duopolico in US is obsolete; it’s full of frauds
& corruption. Urge cambio
"Prefrontal cortical dysfunction is thehallmark of basically all of the societal behavioral problems that
we have experienced in the last 50 years..."
====
"We
are going to dismantle the Minneapolis Police Department”
====
Sacred
dogmas and inconvenient hard stats...
====
Several law
enforcement officials - including cops and two federal agents - have been
ambushed and shot in Oakland and Santa Cruz. Is a potential domestic terrorist
responsible for both attacks?
====
Sacred
dogmas and inconvenient hard stats...
====
Buildings Matter too
"The
Philadelphia Inquirer published a headline in Tuesday's edition that was deeply
offensive. We should not have printed it. We're sorry..."
====
UNITY OF DIFFERENCES vs. CHAOTIC VIOLENCE
This is my answer to the question below
Hugo Adan
6/7/2020
"I believe that there is a much deeper story involved... the problem we are facing
is too many people relative to
resources, particularly energy resources..."
….
Tomorrow I will publish an doct related to distribution of energy among
parts or subcomponents of a system. Meanwhile I can say that a system is a set
of elements functioning as a whole to
achieve a common purpose. The system as whole and every element or sub-part of
the system is able to create two new sources of energy: one is called SYNERGY and the other is named positive ENTROPY.
….
TO DEVELOP THESE ENERGIES:
A ESTO
APUNTAMOS LOS SOCIALISTAS DE HOY.
….
….
AN
INTRODUCTION TO UNITY OF DIFFERENCES
HERE:
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It is no longer hard work,
ingenuity, frugality, and consumer orientation... that determines his
economic fate, butcloseness to the
central bank’s money printing press and meeting requirements for receiving government favors...
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Every single issue that the Democrats used to control the moral high ground on, except
abortion, has been burned up in the past week. Any good will Black Lives Matter had with working class white and
Hispanic Americans is ash...
====
IF HE RESIGN TO
POWER.. HE DOESN’T HAVE TO LIE ANYMORE
"...this is false... I was in the meeting"
….
What is the point in keeping power if his chances of governability
=ZERO if win the re-election this year.
====
Frey later told the TV station that he favors "massive structural
reform to revise a structurally racist system"...but..."I’m not for
abolishing the entire police department. I will be honest about that."
====
If you can’t see what’s coming, you might want to break out of the
house, take off your mask, go for
a walk, and take some deep breaths. The walls are closing in...
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FASCISM AHEAD:
"They're using stuff like this to make us
shut up about our First Amendments..."
====
Meanwhile,
the protest movement has spread from Europe and Australia on to Africa, Asia in
a global show of solidarity for the peaceful demonstrators.
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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
The nation
is working with other G20 members to carry out the G20 debt relief initiative
for low-income countries.
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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
VIENTO SUR
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RT
EN ESPAÑOL
Consejo de Mineápolis anuncia que buscará
desmantelar la Policía de la ciudad https://actualidad.rt.com/actualidad/355845-mayoria-consejo-mineapolis-buscar-desmantelar-policia-muerte-floyd
Transmisión por personas asintomáticas, " talón
de Aquiles" en lucha contra el CV-19 https://actualidad.rt.com/actualidad/355848-descubrir-talon-aquiles-lucha-covid19-personas-asintomaticas
La tormenta tropical Cristóbal toca tierra en EE.UU.
https://actualidad.rt.com/actualidad/355854-torm-trop-cristobal-tocar-tierra-eeuu
Pompeo compara Pekín en Hong Kong con los nazis y un
medio estatal le responde
https://actualidad.rt.com/actualidad/355801-pompeo-compara-acciones-china-hong-kong-alemania-nazi
Confrontación de Donald Trump con las redes sociales
cobra impulso https://actualidad.rt.com/video/355825-confrontacion-trump-redes-sociales
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CROSS TALK https://www.rt.com/shows/crosstalk/
We are told
the civil unrest in the United States and beyond is about systemic racism. We
are told Western institutions and values are inherently flawed and corrupt.
However, neither can really explain the evidence of social breakdown. What is
really at play here is an ideology. An ideology that demands absolute
submission and total power.
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History
doesn’t repeat itself – but it certainly rhymes. George Floyd is yet another
name in a long, tragic list of unarmed black men killed by a police force
plagued with endemic racism, a military mentality and zero accountability. To
the rest of the world America today looks like a failed police state. Host Ross
Ashcroft is joined by former Marine Corps intelligence officer Scott Ritter to
discuss police brutality and what can be done about it.
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Malcolm X,
the hero of many protesters and rioters taking to the American streets these
days, once said that, if you aren’t careful, the media will have you hating the
people who are being oppressed and loving the people who are doing the
oppressing. Is it even possible to make that distinction in today’s America? To
discuss this, Oksana is joined by Peniel Joseph, Professor of Public Affairs at
the University of Texas
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GLOBAL RESEARCH
Geopolitics & Econ-Pol crisis that leads to more
business-wars from US-NATO allies
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