AUG 11 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
LIQUIDATION: STOCKS, BONDS, BULLION, & BITCOIN ALL PUKED
Today had the feeling of 'liquidation' (similar to March) as big-tech stocks (growth/value rotation), bitcoin, bonds, and bullion were all dumped unceremoniously.
While Nasdaq futs were bid along with everything else on Putin's vaccine headlines overnight, it didn't take long for the growth/value rotation pressure to kick in and send them lower as small caps (financial/energy dominant) surged...but late on things rolled over as the liquidations spread and the rest of the market tumbled lower on 'stalled stimulus' talks...
See Chart:
https://www.zerohedge.com/s3/files/inline-images/2020-08-11_13-00-17.jpg?itok=F21nMvXE
This 3-day losing streak for the Nasdaq is the worst in 5 months and the Dow/S&P broke its 7 day win streak.
See Chart:
https://www.zerohedge.com/s3/files/inline-images/2020-08-11_12-51-16.jpg?itok=NIfo_r3_
Momo Value: Another serious quant-quake...
See Chart:
https://www.zerohedge.com/s3/files/inline-images/bfmD54.jpg?itok=T-pOKhDX
FANG stocks staged the typical BTFD effort after an initial tumble but accelerated lower later to foll the gap-up from July 31st...
See Chart:
https://www.zerohedge.com/s3/files/inline-images/bfm2A1.jpg?itok=NH_gK20B
Notably the S&P has a way to go until gamma flips (3218)...
See Chart:
https://www.zerohedge.com/s3/files/inline-images/image008%20%283%29.png?itok=3IVXOOGU
But the Nasdaq's gamma just flipped negative...
See Chart:
https://www.zerohedge.com/s3/files/inline-images/2020-08-11_13-01-47.jpg?itok=nqFUlPZ7
However, it was precious metals that caught the eye today as gold saw its biggest daily drop sine April 2013...
See Chart
https://www.zerohedge.com/s3/files/inline-images/2020-08-11_12-22-27.jpg?itok=TdaLcwWF
And silver crashed by its most since Lehman (Oct 2008)
Sending the gold/silver ratio spiking...
See Chart:
https://www.zerohedge.com/s3/files/inline-images/bfm14EA.jpg?itok=Sujtu27l
Gold's initial tumble tracked real yields perfectly but over-did as the yellow metal broke $2000 and ran stops...
See Chart:
https://www.zerohedge.com/s3/files/inline-images/bfmBFA2.jpg?itok=x-Pi-lpK
So, Vladimir Putin (whose nation has been among the most avid buyers of gold for its reserves in recent years), announces a vaccine (which crushes the price of gold by the most since Lehman)? Does make you wonder eh?
But let's not over-react too much eh?
We are all in big trouble if this gap is really starting to fill - a surge in rates of that scale will kill America's balance sheet and a purge of that scale in stocks will be worse for sentiment still...
See Chart:
Nasdaq vs 10Y Yield
https://www.zerohedge.com/s3/files/inline-images/bfm4A5D_0.jpg?itok=OWzqkdfN
Simply put, The Fed is in a corner, it can't let rates run (debt loads) on the back of hope-filled 'reflation' and if the growth-to-value rotation escalates further it will create a flight to safety in bonds... which will hurt financials and thus leave the two legs of the growth/value rotation hurting.
The B-dollar index ended marginally higher after another roller-coaster today...
See Chart:
https://www.zerohedge.com/s3/files/inline-images/bfm5A04.jpg?itok=bHqFaRaf
Finally, one wonders if the 'dead cat bounce' is over (if nothing else, today's reversal is interestingly timed)...
See Chart:
DOW: Then vs Now
https://www.zerohedge.com/s3/files/inline-images/bfmA899.jpg?itok=FJQECMF2
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SOURCE: https://www.zerohedge.com/markets/bonds-bullion-big-tech-battered-reflation-quant-quake-continues
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CENTRAL BANK BALANCE SHEETS TO HIT $28 TRILLION NEXT YEAR
The numbers are just a joke now.
Putting an actual number to the liquidity firehose, central banks have injected $24 trillion, or about a quarter of global GDP, into the market to keep it from crashing and expectations are that this number will increase to $28 trillion by the end of next year (this excludes the tens of trillions in assorted liquidity instruments in China). That would be a very optimistic expectation.
SEE Chart:
Aggregate G-6 Central Bank Balance Sheet $tn)
https://www.zerohedge.com/s3/files/inline-images/%2426%20trillion.jpg?itok=d-usBGTj
And since these days chart inflation means that one picture is worth a trillion words, we will focus on the visuals as they are self-explanatory.
SEE Charts
https://www.zerohedge.com/s3/files/inline-images/bofa%20fed%201.jpg?itok=ghmq9x7o
….
SOURCE: https://www.zerohedge.com/markets/central-bank-balance-sheets-hit-28-trillion-next-year
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"THE GREATEST PULL-FORWARD IN HISTORY": WHY THIS RECESSION IS DIFFERENT, SIMILAR, & WORSE
The COVID recession resulted in the most significant “pull-forward” of income growth in modern history.
“...economics is not accounting. We have to grapple with nonlinearities"...
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The outcome of the recession will ultimately be worse as the level of public and private indebtedness has breached all critical thresholds and will now have a non-linear impact on economic growth.
Typically, during recessions, income falls for the average population.
In 2020, due to one-time stimulus checks and massively boosted unemployment benefits, so far, we have seen 32% annualized growth in income during the recession.
SEE Chart:
Real Disposable Personal Income Growth: Per Capita (Annualized Growth):
https://www.zerohedge.com/s3/files/inline-images/1-2_11.png?itok=1kqGY5NT
This recession is clearly different because income growth went up as opposed to going down, a significant deviation from the standard recessionary outline.
SEE CHART:
Government Transfer Payments As A % of Total Personal Income:
https://www.zerohedge.com/s3/files/inline-images/2-2_7.png?itok=0DyH9aqs
Using assumptions which are likely too low, total nonfinancial debt as a % of GDP will surge to 310%, breaching the cumulative threshold outlined in the BIS paper, “The Real Effects of Debt,” the level at which debt starts to have a nonlinear negative impact on economic growth.
In fact, there have been dozens of papers written about the impacts of extreme levels of debt; virtually none cite high inflation as the result unless the central bank’s liabilities become legal tender, something discussed at the conclusion of this note.
See Chart:
Total Nonfinancial Debt As A % of GDP:
https://www.zerohedge.com/s3/files/inline-images/3-2_6.png?itok=ByU39cOi
Government debt as a % of GDP has risen to levels that are significantly above the threshold for diminishing marginal returns yet we continue to believe that more is more, dismissing the evidence that more government debt, regardless of the use and the balance sheet on which it resides, will have a nonlinear negative impact on economic growth.
See Chart:
Government Debt As A % of GDP:
https://www.zerohedge.com/s3/files/inline-images/4-2_5.png?itok=lo04A8Og
From the 1960s through the early 2000s, real personal disposable income growth per capita increased at a 3.0% annualized rate during expansionary periods. After the turn of the century, we lost 36% of our trend income growth, falling to just 1.9%. Many factors contributed to this decline, but diminishing marginal returns and an overuse of debt capital are among the main culprits.
See Chart:
Real Disposable Personal Income Growth: Per Capita (Annualized Growth):
https://www.zerohedge.com/s3/files/inline-images/5-2_8.png?itok=BA6jDLEg
A lack of investment in structures and equipment ensure that the velocity of money will remain weak as a negative net national savings rate coupled with a lack of investment will begin to erode our existing capital equipment.
See Chart:
Private Nonresidential Fixed Investment: Structures & Equipment As A % of GDP:
https://www.zerohedge.com/s3/files/inline-images/6-2%20%281%29_0.png?itok=JV1PT05d
Income growth has increased during this recession, a distinct difference from the normal recessionary template. The use of debt capital, specifically government debt capital, to blunt the impact of deflation is a page out of the same playbook the economy has been using for several decades.
The resulting degradation of income growth during the next expansionary period will be worse than prior episodes as we have pushed the level of indebtedness passed all critical and well-studied thresholds.
We should continue to prepare for anemic real income growth and the knock-on effects that dynamic will bring to asset prices.
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US DOMESTIC POLITICS
Seudo democ duopolico in US is obsolete; it’s full of frauds & corruption. Urge cambio
COMMERCIAL REAL ESTATE BANKRUPTCY LEGISLATION INTRODUCED
"The bill provides significant relief to small business debtors and landlords. It also reinforces what many landlords have done since spring, as well as encourage deferred deals going forward."
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CNN IS HOSED IF TRUMP LOSES: FORMER EXEC
"Make no mistake, it’s a symbiotic relationship. The dramatic rise and relevance of CNN for better or worse is tied to Donald Trump."
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Kamala no es negra ni asiática, es latina, de Jamaica, la pequ isla de caribe que fab rom
BIDEN PICKS KAMALA HARRIS AS RUNNING MATE
Will she listen to Willie and decline?
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Que se espera de Trump frente a Biden-HARRIS?. Mucha prudencia y audacia pues la candidatura de Biden se fortalece con ella. Lo mejor que puede hacer Trump de aquí para adelante es “ignorar a Kamala”, y lo peor: atacarla. Sera fácil convertir cualquier ataque a ella en un bumerang contra Trump. Ella si puede atacar y con dardos venenosos. No es Trump quien debe responder sus ataques sino otra mujer que conozca bien a Kamala (que no invente). Lo mejor que puede hacer Trump es elegir a una mujer afro-americana, para el contra-ataque, pero jamás un blanco pues lo acusaran de misógino, racista y neo-nazi. Sin duda Trump tiene que cerrar la boca y sus twits para vencer a KAMALA. De eso depende su re-elección: del equipo encargado del contra-ataque a K-MALA
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TRUMP BRIEFS PRESS AS MCCONNELL SAYS STIMULUS TALKS HIT "STALEMATE"
Only a few hours after Mitch McConnell kicked the legs out from under the market by announcing that stimulus talks had reached a "stalemate"...
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En este caso el stalemate o mate ahogado no es un empate, sino un “todos ganamos” y/o “todos perdimos”. Como se refiere estímulos= todos ganamos
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MAJORITY OF AMERICANS THINK BIDEN UNLIKELY TO FINISH 4 YEAR TERM IN WHITE HOUSE
Biden’s VP pick will become president IF he beats Trump...
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1-la supuesta victoria de Biden no existe aún: Trump puede voltear la tortilla
2-Puede ganar negros con una negra de VP, Milenios y graduate Students con el ZERO DEBT y a muchos solo reciclando los estimulos mensuales. Puede además hacer ajustes en el Presup militar y aplicar algunas políticas de FDR empezando por desprivatizar el sistema salud. Lo que no tiene que hacer es crear ambiente guerrerista contra China-Rusia. Si lo hace, pierde las elecciones
3-Trump puede además negociar pacto con lideres del Frente Socialista y reconocerles el derecho a la 3ra option para : A- Cambiar el estatuto electoral que anule el voto por correo sin previos debates=fraude. B-Generar Governabilidad para el ganador de las elecciones asegurándoles el 50% en la distribucin del poder poli a nivel nacional (gobernador,congreso y house).
4- Hacia una nueva distribución del poder político en el país. Hay que darle el 50% del poder político nación al ganadore de las eleeciones. Dar el 30% del poder total al 2do partido mas votado y 20% a la 3ra opción, sin importar la cantidad de votos que haya obtenido.
Por que dar el 20% del poder a la 3ra opcion? 1ro porque hay que desmantelar el caos y violencia interna del actual sistema duo-polico que tenemos. 2do, porque el desarrollo económico –social de la nación requiere equilibrio interno entre las energías que corresponden a c/u de las partes dentro de un sistema.
5 Hay que usar la teoría de sistemas parel cambio radical del sistema político interno. En esta teoría las partes cumplen funciones diferentes y cada función requiere diferente cantidad de energía para su auto=desarrollo. A esa unidad de las diferencias y estado de equilibrio que eso genera en un sistema-Nation se conoce con el nombre de homeostasis y es el objetivo al que hay que apuntar en nuestro pais. Lo logró FDR en la anterior recesión y se lo puede lograr otra vez. Para esto se necesita activar la 3ra opción política dentro de las actuales elecciones.
Si no existe la 3ra opción muchos, muchísimos votantes no iremos a las urnas a adornar el circo electoral. PREFERIMS LA ABSTENCION
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EL RESTO PARA MAÑANA
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