SEP 27 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
TRADE BASED ON THE GROWTH OF THE FED'S BALANCE SHEET
This broad view of the relationship between Fed actions and stock market performance appears to suggest a causal link going from central bank policies to asset prices
Bank of America confirmed that we were correct: as the bank's chief equity strategist Savita Subramanian wrote last April, "over the last several years, buying the most underweight stocks by large cap active funds and selling the most overweight stocks by large cap active funds has consistently generated alpha."
As the bank added, the 10 most neglected stocks had outperformed the 10 most crowded stocks by an annualized spread of 8.4% on average during the first 15 days of each quarter since 2012. This is shown in the chart below which reveals that buying the 10 most underweight stocks and selling the 10 most overweight stocks by active funds has generated alpha every year in the past five except 2017.
See Chart:
https://www.zerohedge.com/s3/files/inline-images/bofa%20most%20shorted%20returns_0.jpg?itok=_RbT23LV
The Fed balance sheet and the stock market
Monetary policy historically dictates asset price dynamics, with low interest rates and accompanying expansionary monetary policy supporting risk asset rallies and monetary contractions by contrast driving market retreats. This has increasingly been more obvious since the Great Financial Crisis of 2008, where financial market reactions appear to have become increasingly aligned and dependent on central bank actions.
Indeed, with the advent of QE programmes as monetary policy tools in the wake of the 2008 GFC, the trajectories of market performance and the Fed balance sheet appear to have converged into lock step. Total assets on the Fed balance sheet have expanded from $2.24tn at the end of 2008 to the current level of about $7tn, for 216% growth, while the S&P 500 rose from 903.25 to about 3340, netting cumulative growth of about 270% during the same period. Over the course of the current pandemic, the Fed balance sheet has increased from $4.67tn on 18 March 2020 (a week before the market bottom) to $7.01tn, growing by 50%, while the S&P 500 has risen by 42% during the same period.
See Charts:
https://www.zerohedge.com/s3/files/inline-images/Fed%20BS%20and%20SPX%20socgen%201.jpg?itok=ag-2qa-C
Here is a summary of the simple strategy proposed by the SocGen quants - to trade in lockstep with the change in Fed's balance sheet:
. Since the Great Financial Crisis of 2008, financial markets appear to have become increasingly aligned with central bank actions and increasingly less connected to economic fundamentals.
- The sheer scale of these unconventional measures does seem to have also made asset returns more predictable, and performance appears increasingly contingent on central bank actions. This provides a potential opportunity for investors.
· And with the Fed committing to maintain its asset purchase programmes “at least at the current pace to sustain smooth market functioning”, and with ultra-low rates expected to at least until 2023, according to the Fed, it is clear these unconventional monetary policies are going to remain a key driver of markets for some time.
To help confused Gen-Z investors (and other hedge funds), the SocGen note introduces a simple tactical alpha strategy that uses the growth of the Fed balance sheet to measure the degree to which monetary expansion is supporting risk-asset rallies.
The negative correlation between lagged stock market performance and current growth in Fed assets (left-hand chart) means that stock market declines increase the likelihood of Fed action in the form of balance sheet expansion.
See Charts:
Fed Balance sheet growth & S&P 500 returns
https://www.zerohedge.com/s3/files/inline-images/Fed%20BS%20growth.jpg?itok=OZ0I4vKy
Consistent with economic priors, balance sheet expansion leads to stronger positive market returns, and our analysis shows that this lasts for up to four weeks, following the policy change (left figure), with a peak observed at three weeks. On the other hand, and contrary to expectations, Fed balance sheet contractions are also followed, on average, by market rebounds, although the strength of these correlations were much weaker in the initial three weeks, with a stronger bounce on the four-week mark.
Table 1 below summarizes the performance of this simple tactical tilting strategy. It should come as no surprise to almost anyone, that a systematic tracking of the Fed balance sheet adds value, with the strategy generating annualized excess returns of about 250bp per annum with a tracking error of similar magnitude, providing a risk-adjusted alpha of one, at hit rate above 60%.
See Table:
Comparing the performance of the "tactically-boosted" portfolio against the traditional 75/25 benchmark, total returns would have gone up to 12.9% from 10.4%, while the Sharpe ratio improves only modestly as overall volatility would also pick up.
See Charts:
During the winding down of QE and quantitative tightening in 2017 and 2018 all through half of 2019, the portfolio largely took off its equity bet, staying with its max cash positions, only to get go back to equity starting in the latter part of 2019 as monetary easing began. It was also heavily tilted towards equity in the heyday of QE in 2010 through 2014, with periodic shifts to cash during moments of a lull in asset purchases.
See Chart:
Thus, as the quants conclude "using the overall Fed assets may provide signal diversity across the three pillars, aggregating information on unconventional policies across all domains of Fed activities."
See table:
https://www.zerohedge.com/s3/files/inline-images/tactical%20alpha%20socgen%20table.jpg?itok=iRx3AQbk
That said: As Lapthorne et al wrap up, "while illustrative, the strategy provides a framework to extend to analogous cases of risk -on/- off cases involving other asset classes, as well as the design of long/short strategies with leverage "
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US DOMESTIC POLITICS
Seudo democ duopolico in US is obsolete; it’s full of frauds & corruption. Urge cambio
HIGHLY-EDUCATED AMERICANS ARE BY FAR THE MOST CLOSED-MINDED; GALLUP
Higher education in America increases, instead of decreases, an individual’s closed-mindedness... This describes a declining culture – in a nation that is in decline...
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THE STATE'S RESPONSE TO THIS "VIRUS" IS NOTHING MORE THAN A WEAPON OF MASS SUBMISSION
The more the people rebel, if at all, the stronger any response by the state apparatus will be. If enough question the validity of this virus pandemic, a new and more dangerous strain will magically emerge...
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THE RIDDLE OF TRUMP TAXES
By Hugo Adan
9/27/20
Does Trump:
1- paid no federal income taxes in 11 of 18 years
2- reduced his tax bill with questionable means + $72.9 million tax refund
3- declared losses in gambling +golf courses to lower his taxes
4- take tax deduct on what people consider person exp: aircraft + hairstyling
5- declared hundreds of millions of dollars in loans he personally guaranteed
6- Ivanka T receiv/pay “consulting fees” that also help reduce family’s tax bill.
7- received money from foreign sources no declared, as never happen before
In election time all this will be issue to discuss in public.
Detailed info you can get it in:
"We are not making [Trump’s tax] records themselves public because we do not want to jeopardize our sources, who have taken enormous personal risks to help inform the public."
The NYT published what to many anti-Trumpers is the holy grail of Trump bomshells: a 10,000+ word summary of more than two decades of Trump tax documents which reveal that the president paid no income taxes for 10 of the 15 years before he was elected president, with his income tax payments in 2016 and 2017 amounting to just $750. The reason, as was already largely known, Trump had generated nearly $1 billion in casino-linked losses in the 1990s and onward (incidentally, loss carry fowards or NOLs are perfectly acceptable and legal instrument which anyone can apply against future income) and which offset much of the money that he made.
The NYT also claims the documents show Trump losing millions of dollars from his golf courses, "vast write-offs, an audit battle and hundreds of millions in debt coming due" and that Trump earned $73 million abroad.
Combined, Trump initially paid almost $95 million in federal income taxes over the 18 years. He later managed to recoup most of that money, with interest, by applying for and receiving a $72.9 million tax refund, starting in 2010.
The NYT report focuses closely on the specifics of the $73 million refund:
A large refund has been crucial to his tax avoidance.
Mr. Trump did face large tax bills after the initial success of “The Apprentice” television show, but he erased most of these tax payments through a refund. Combined, Mr. Trump initially paid almost $95 million in federal income taxes over the 18 years. He later managed to recoup most of that money, with interest, by applying for and receiving a $72.9 million tax refund, starting in 2010. The refund reduced his total federal income tax bill between 2000 and 2017 to an annual average of $1.4 million. By comparison, the average American in the top .001 percent of earners paid about $25 million in federal income taxes each year over the same span.
The $72.9 million refund has since become the subject of a long-running battle with the I.R.S.
In 2011, the I.R.S. began an audit reviewing the legitimacy of the refund. Almost a decade later, the case remains unresolved, for unknown reasons, and could ultimately end up in federal court, where it could become a matter of public record.
A visual summary prepared by the NYT of Trump's profit and losses is shown below
See Chart:
https://www.zerohedge.com/s3/files/inline-images/trump%20tax%20chart.jpg?itok=PvMtnbyn
One argument made by the NYT is that by the time Mr. Trump announced his candidacy in 2015, his revenue streams from “The Apprentice” and licensing were drying up", his "proceeds from fame continued to tumble, falling below $10 million in 2017 and to $2.9 million in 2018" and Trump "was in need of financial reinvigoration." This is where the idea to run for president came form.
See Chart:
https://www.zerohedge.com/s3/files/inline-images/proceeds%20from%20fame.jpg?itok=0UrPVJ4G
The question then is, since there appears to be no discovery of legal malfeasance, did Trump's businesses benefit from the presidency which the NYT responds affirmatively "in some respects" pointing to the flood of new members in Mar a Lago "starting in 2015 allowed him to pocket millions more dollars a year from the business."
And without a blockbuster "gotcha" that would confirm that Trump had violated the law, the NYT simply concludes by noting that "in the end the financial picture for Mr. Trump is fraught" and that "as he approaches one of the most consequential elections in American history — down in most polls, under I.R.S. audit and heavily in debt — his businesses may not be well equipped to navigate what lies ahead."
While notable, and hardly unique to just the president, this is probably not the damning climax so many in the anti-Trump field were expecting in the 4-year-long crusade to get Trump's tax returns. Oh yes, and then there is the audit, the same audit Trump has said prevents him from publishing his tax filings:
Hanging over his head is the audit. Should the I.R.S. reverse the huge refund he received 10 years ago, Mr. Trump could be on the hook for more than $100 million.
For those pressed for time, here is a recap of the key revelations in the NYT article, which the NYT recapped in a separate article:
SEE LIST:
- Mr. Trump paid no federal income taxes in 11 of 18 years that The Times examined. In 2017, after he became president, his tax bill was only $750.
- He has reduced his tax bill with questionable measures, including a $72.9 million tax refund that is the subject of an audit by the Internal Revenue Service.
- Many of his signature businesses, including his golf courses, report losing large amounts of money — losses that have helped him to lower his taxes.
- The financial pressure on him is increasing as hundreds of millions of dollars in loans he personally guaranteed are soon coming due.
- Even while declaring losses, he has managed to enjoy a lavish lifestyle by taking tax deductions on what most people would consider personal expenses, including residences, aircraft and $70,000 in hairstyling for television.
- Ivanka Trump, while working as an employee of the Trump Organization, appears to have received “consulting fees” that also helped reduce the family’s tax bill.
- As president, he has received more money from foreign sources and U.S. interest groups than previously known. The records do not reveal any previously unreported connections to Russia.
While the media will be going through all of these revelations with a fine-toothed comb, it's also notable what the report fails to show: unless the NYT has saved the kicker for a subsequent article, "there appears to be no wrongdoing, no Russia ties, and nothing of substance beyond what most corporations do", as the National Pulse's Raheem Kassam writes.
Also of note, the New York Times failed to include the details of the returns in its reporting, admitting in its own article: “The Times declined to provide the records, in order to protect its sources.”
When asked during a Sunday news conference about the NYT revelations, Trump called the central claim the NYT makes – that he only paid $750.00 in federal income taxes – "fake news."
In a statement to The Times, Trump Organization lawyer Alan Garten said "most, if not all, of the facts appear to be inaccurate” and reportedly took issue with the amount of taxes Trump has paid: "Over the past decade, President Trump has paid tens of millions of dollars in personal taxes to the federal government, including paying millions in personal taxes since announcing his candidacy in 2015."
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MY CONCLUSION:
Is that last statement a FAKE NEWS TOO?.. if YES.. WE WILL SEE IT in the DEBATE this coming Tuesday. IF NOT FAKE NEWS, they will silence, not mention it and that will be a clear sign that New Federal Court is also corrupt, then the only chance for real LAW, Social Peace & reliable system will come with PEOPLES REV starting with referemdums
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ACADEMIC APPROPRIATION? JOE BIDEN CLAIMS HE ATTENDED 'HISTORICALLY BLACK COLLEGE'
“I got started out of an Historically Black College... They’re my folks.”
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FROM PISTOL-DOLLAR TO PETRO-DOLLAR TO PHARMA-DOLLAR...
The WHO assumed the role OPEC played in 1973. It declared a global pandemic under the most spurious conditions with the full knowledge that this would not only permit a shutdown of the economy... to create the Pharmadollar.
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COLORADO ENCOURAGES DEAD PEOPLE, NON-CITIZENS TO VOTE
"My mother has been dead four years and she hasn’t lived, voted, owned property, worked, or done anything other than visit Colorado since 1967."
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FED wasting money on weapons still continue, even with MAD chances of WW3
FIRST LOOK: THE NAVY'S NEW $13 BILLION TOY RULES THE SEA
When it comes to pure military technological power, America’s armed forces are second…
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TEXAS RESIDENTS WARNED THEIR DRINKING WATER MAY CONTAIN A "BRAIN-EATING MICROBE"
The infection is usually fatal and has been seen before, notably in tap water in Southern Louisiana from 2011 to 2013. It was also found in an untreated geothermal well in Arizona in 2003
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BACKLASH BUILDS AFTER BIDEN COMPARES TRUMP TO NAZI PROPAGANDIST GOEBBELS
“This is unacceptable, offensive and demeans the memory of the Holocaust...Biden must apologize!”
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TRUMP ADMINISTRATION, CDC SUED BY LANDLORDS OVER 'UNCONSTITUTIONAL' MORATORIUM ON EVICTIONS
"The CDC eviction moratorium will surely cause
more economic harm than it prevents."
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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
FEDERAL JUDGE BLOCKS TRUMP'S TIKTOK BAN HOURS BEFORE MIDNIGHT DEADLINE
` A decision might not arrive until late, but the judge may have tipped his hand earlier today...
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NORTH KOREA WARNS OF BORDER INTRUSIONS BY SOUTH'S NAVY AMID SEARCH FOR SLAIN OFFICIAL
Despite unprecedented Kim apology there's a huge build-up of naval forces along military demarcation line...
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ARMENIA ORDERS 'FULL TROOP MOBILIZATION' AGAINST AZERBAIJAN AS TANKS CLASH, MARTIAL LAW DECLARED
Military & civilian death toll rising, tank & aerial front warfare as disputed Nagorno-Karabakh region explodes near sensitive Caucuses pipelines corridor transporting oil & gas to world markets...
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Regarging trust .. they are more honest than we are
SURGE IN CHINESE INDUSTRIAL PROFITS CONTINUES, BUT IS THIS JUST MORE "FAKE DATA"
Can any data out of China ever be trusted?
As a result, the current divergence between Industrial Profits and PPI is the widest it has ever been.
See Chart:
https://www.zerohedge.com/s3/files/inline-images/China%20ind%20prod%20vs%20PPI.jpg?itok=3mvyFQJs
China Total Social Financing .. from US view
See Chart:
https://www.zerohedge.com/s3/files/inline-images/china%20TSF_1.jpg?itok=-uYFQ3PZ
China Industrial profits: mind the gap
See Chart:
https://www.zerohedge.com/s3/files/inline-images/industrial%20profits_0_0.jpg?itok=YnNpLnFF
For more distortions on China see: "More Fraud Exposed In Chinese Official Econ Data").
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SOURCE: https://www.zerohedge.com/markets/surge-chinese-industrial-profits-continues-just-more-fake-data
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IRAN OIL SHIPMENTS REACH YEAR-LONG HIGH IN SEPTEMBER, DEFYING US SANCTIONS
Record post-sanctions “levels we haven’t seen in a year and a half.”
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COVID-19 DEATHS NEAR 1 MILLION AS OUTBREAKS WORSEN IN US, EUROPE: LIVE UPDATES
Several European leaders spoke out against another round of lockdowns
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"ANYTHING TESLA CAN DO, WE CAN DO": HUAWEI SET TO BECOME MAJOR COMPETITION IN ELECTRIC VEHICLES
"Anything that Tesla can do, we can do."
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US'S HYBRID WAR ON RUSSIAN ENERGY TARGETS GERMANY, BELARUS, AND BULGARIA
...banking on the fact that even the partial success of this strategy would greatly advance the scenario of an externally provoked “decoupling” between Moscow and Washington's transatlantic allies...
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SPUTNIK and RT SHOWS
GEO-POL n GEO-ECO ..Focus on neoliberal expansion via wars & danger of WW3
-Twitter Removes RIA Novosti From Search Results
-Church of Sweden in Hot Water for Defending 'Islamist-Linked' Charity
-Venezuela Aims to Overcome Effects of US Sanctions With New Legislation
-Azerbaijan Accuses Armenia of Attacking Town of Terter, Vows to Retaliate
-German Chancellor Merkel Paid Secret Visit to Navalny at Charite Hospital
-Danish Prime Minister Lashes Out Against Sharia Law in Parallel Societies
-US Reconnaissance Drones Replacing Ukrainian Ones Near Crimea Borders
-US Warns Iraq About Plans to Withdraw From Baghdad Embassy
-Kim Kardashian Urges Baku to Stop ‘Offensive Uses of Force’ Against Armenia, Asks For Int’l Measures
-US Military SUICIDES Rise 20% During Coronavirus Pandemic,
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