Aug 29 2021 ND SIT EC y POL Part 1
ND denounce-neoliberal debacle y propone State-Social + Capit-compet in Eco
Quick News:
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Sweden Allegedly Sought to Bomb Afghanistan as Advertisement for Its Fighter Jets,
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WHY THE LOSS OF AFGHANISTAN ULTIMATELY ENDS THE EMPIRE
Recent events in Afghanistan will prove the death-blow to the Empire: article, sources and 14-min. video report
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ZERO HEDGE ECONOMICS
Neoliberal globalization is over. Financiers know it, they documented with graphics
By Larry McDonalds, author of The Bear Traps Report
History will record that during the present time the most used word was "inflation" and the second most used word was "temporary."
What isn't in this life transitory? But if inflation lasts three years because of a demand shift caused by a zero-carbon emissions goal consensus, then call it what you will, we at The Bear Traps will allocate capital accordingly. It reminds us of Marty Zweig not caring if the down stock market was a correction or a bear market. Either way, he didn't want to be long stocks. We don't really care if inflation ends a year or three from now. We want to be long energy and metals.
By insisting on the word "transitory" all the Fed is signaling is that it is ignoring and will continue to ignore prices of goods and services. It's brilliant in its own way because if six months from now prices are still going up, the Fed will merely say that, aha, now, surely, inflation is transitory. And it will play that game every six months for years if it can. It will only change its tune when things get so bad it has to change. As we have pointed out several times in the past, even Volcker didn't fight inflation until he saw directly that inflation was increasing unemployment.
See Chart:
Long History of Average Inflation
Some things are different now, of course than in Volcker's day, the primary one being the Fed owns such a large portion of the treasury float that the treasury market has lost most, not all, of its signal value. This type of thing is not without precedent, by the way. The early 1930s devaluation of the dollar caused gold to go from just above $20 to $35, where it remained fixed into Nixon's administration. That was a long time.
What is clear is that US bond yields have a negative real return. If you own treasuries, you are pretty much guaranteed to lose money in real terms. This should cause borrowing to increase, which in fact has happened. Mortgage debt is above $10 trillion, surpassing the pre-Lehman crash peak. An expansionary monetary and fiscal policy assumes that by extending credit, people will still by everything at increasingly higher prices no matter what. The reality is somewhat different. At first it goes along that way, true enough, but then comes a sticker shock pause, followed by a hoarding panic buying spree.
Normally this last phase causes a run on the currency which is akin to throwing nitroglycerin into a raging fire. At this point, central banks cave, raise rates, and accept the stock market selloff and economic recession. Unless, of course, yours is a reserve currency. That can, but doesn't have to, change the game theory. Bottom line: Fed and Treasury probably figure they can get away with whatever they want to do. Of course, if they are wrong, it's an unmitigated disaster. And yet, of course, something like a 9% weaker greenback would probably be welcomed by Fed and Treasury.
And finally, we have the problem of more money supply. At this point, money creation is no longer the immediate risk. No. The immediate risk is an increase in the velocity of the money that has already been created. Velocity has collapsed to such an extent that simply to mean revert to its downward regression line of old would be massively inflationary. But of course the velocity of money will increase as transactions increase in a global synchronized post Covid scenario. And finally, once the global economy kicks into high gear for several quarters, then, and only then, will banks start to aggressively lend thereby increasing the money supply magnificently.
So sustainable inflation seems fairly inevitable at this point even if years from now it proves "transitory."
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SOURCE: https://www.zerohedge.com/markets/coming-inflation-shock
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THE SNAP BOOST WILL MAKE THE POOR APPEAR POORER
Dramatic mis-measures of income have long sustained efforts to justify political redistribution.
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MORGAN STANLEY: THIS FALL WE EXPECT THE MID-CYCLE TRANSITION TO END WITH A 10%+ S&P 500 CORRECTION
By Michael Wilson, chief US equity strategist at Morgan Stanley
...but a narrative of either fire or ice will determine the leadership from here.
With the S&P 500 up another 20%+ so far this year, many active managers are finding it hard to keep up, as the market leadership has bounced around more than normal.
With that said, the price action in US equity markets this year has followed the script of changing narratives quite nicely. Cyclicals and small caps led the charge earlier in the year as the market contemplated the distribution of vaccines and a reopening of the economy, in line with our early cycle stage recovery narrative. In mid-March we pivoted to a new narrative, labeling it the ‘mid-cycle transition’ – the period when markets contemplate the peak rate of change in growth and policy.
However, the S&P 500 has avoided its typical 10%+ drawdown as valuations have remained elevated, with large-cap quality in favor. Normally, P/E ratios for the S&P 500 fall by approximately 20% during a mid-cycle transition. So far this year, they have fallen by only 5%. Contrast that with the P/E for the Russell 2000 small-cap index, which has declined by almost 20%.
See Chart:
Our mid-cycle transition narrative is playing out
https://cms.zerohedge.com/s3/files/inline-images/mid%20cycle%20transition%20end.jpg?itok=ZOaXdU-3
As noted, small caps have started to outperform the MSCI quality index as well as the S&P 500 and Nasdaq 100, two of the highest-quality large-cap indices in the world. We think this may be the early signal that it’s time for high-quality names to finally take their hit on valuation, completing the mid-cycle transition. Understanding why this might happen could help to put one into the right stocks for the rest of the year. We see two very different possible narratives ahead.
· On the one hand, while the Fed has not yet begun to taper its asset purchases, we think that the start is inevitable later this fall or in the winter. With record GDP and earnings growth, rising inflation and the rates of infection from the Delta variant peaking, the Fed will feel more pressure to remove what is essentially emergency monetary accommodation. We expect a more formal signal from the Fed at the September FOMC meeting, and the markets are likely to anticipate it. That means higher interest rates and lower equity valuations. Our rates strategists expect a move to 1.8% on 10-year Treasury yields by year-end. Assuming a stable equity risk premium at 345bp, P/Es would fall to 19x, or 10% lower. With the quality stocks now expensive relative to the market and arguably more crowded today, it may be their turn to experience the rolling correction that’s been ongoing all year. It also suggests that we get a rotation back towards cyclicals and reopening plays. We favor financials the most in this possible outcome.
· The other reason why we might finally see the S&P 500 experience its mid-cycle transition correction is that growth disappoints. With peak everything, a deceleration is looming, and the chances are increasing that it’s greater than expected, as forecasts have been extrapolated from an unrepeatable 1H consumption boom. In this outcome, we favor defensive quality sectors like healthcare and staples that have less valuation risk in the event rates move higher.
In short, this fall we still expect our mid-cycle transition to end with a 10%+ S&P 500 correction, but a narrative of either fire or ice will determine the leadership from here. As such, our recommendation is a barbell of defensive quality with financials to participate and protect in either outcome.
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HIGH-FREQUENCY DATA SHOW DELTA FEARMONGERING SOFTENS ECONOMY
by Tyler Durden
"The softer-than-expected July retail sales report, combined with moderating demand for dining out and air travel, and delayed back-to-office plans, flag downside risks to consumer momentum in the second half." [ See Chart ]
Broadly speaking, US economic surprise data, which measures the degree to which the economic data is either beating or missing economists' forecasts, turned negative in late July and continues to plunge.
See Chart:
US Economic Surprise Index
https://cms.zerohedge.com/s3/files/inline-images/Snag_15b58d66.png?itok=DBPHCNyZ
For a real-time glimpse of the economy (courtesy of Bloomberg), otherwise known as high-frequency data, there are signs that airlines, hotels, and restaurants are experiencing a slowdown in activity as mainstream media fearmongers the Delta variant.
AIRLINES
There's been a "deceleration in leisure booking and an increase in cancellations," said Helane Becker, senior reseach analyst with Cowen Inc. As companies have delayed a return to offices, the return of business air travel is also likely delayed, she said.
See Chart:
https://cms.zerohedge.com/s3/files/inline-images/Snag_159dc553.png?itok=doGfzavg
HOTEL OCCUPANCY
"Demand looks like it is running slightly worse than the typical seasonal decline," said Bill Crow, Raymond James Financial analyst. There's "a chill on travel caused by the delta variant case increases" with business-travel markets doing poorly.
See Chart:
Declining Occupancy
https://cms.zerohedge.com/s3/files/inline-images/Snag_159db92d.png?itok=cIBgyoFK
Bloomberg's economist Eliza Winger wrote, "the delta variant has shown some signs of restraining vigor in consumer spending on in-person services. The softer-than-expected July retail sales report, combined with moderating demand for dining out and air travel, and delayed back-to-office plans, flag downside risks to consumer momentum in the second half."
A slowing economy for the Biden administration is a big dilemma and could be used as talking points by Republicans in next November's midterm elections.
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SOURCE: https://www.zerohedge.com/economics/high-frequency-data-show-delta-fearmongering-softens-economy
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Bye Bye US dollar
SECOND-LARGEST US MORTGAGE LENDER TO ACCEPT PAYMENT IN BITCOIN
"We’ve evaluated the feasibility, and we’re looking forward to being the first mortgage company in America to accept cryptocurrency to satisfy mortgage payments."
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PUTIN OPPOSES MANDATORY JABS, SAYS PEOPLE SHOULD GET VACCINATED WITHOUT COERCION
"No one should be forced to get a jab..."
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HOW LONG WILL THE US DOLLAR'S DOMINANCE LAST?
...nothing lasts forever...
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FED SAYS TAPER IS COMING. BULLS HEAR "NO TAPER NOW"
The distortions in the markets from excess accommodation continue to mount
Why Bonds?
If there is a risk-off event in the market, yields will drop to 1% or less providing a nice bump in appreciation in our bond portfolio. In the meantime, we are collecting a bit of income while holding the hedge.
The distortions in the markets from excess accommodation continue to mount. Nowhere is this more clearly shown than in the spread between the market and CCC-rate junk bond yields.
See Chart:
https://cms.zerohedge.com/s3/files/inline-images/SP500-CCC-Junk-082621.jpg?itok=WTg4AlBY
Read more comments & Charts at:
SOURCE: https://www.zerohedge.com/markets/fed-says-taper-coming-bulls-hear-no-taper-now
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Seudo democ duopolico in US is obsolete; it’s full of frauds & corruption.
AMERICANS HAVE TRADED THEIR FREEDOMS FOR SAFETY FROM COVID, AND NOW WE HAVE NEITHER
...will you continue to believe in the totalitarian fantasy that is the government creating a world without risk...
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THE FED KEEPS PRINTING "OR THE WHOLE THINGS BLOWS UP"
"Confidence will eventually collapse...
At first slowly, and then, all at once..."
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Internal contradictions & fast greed could create the US Economic implosion
APPLE CEO RECEIVES $750 MILLION PAYOUT, BEGINS TO DUMP STOCK
Apple CEO Tim Cook will collect the 10th and final installment of a pay deal he received a decade ago in August 2011 when he took the reins former CEO and Apple co-founder Steve Jobs, who died in October 2011.
The latest tranche consists of 5 million shares worth $750 million, according to calculations by Bloomberg. The payout was contingent on Apple's stock returns over the last three years, which jumped nearly 200%.
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Manufacturing weapons & create war abroad is our main business: IT create violence
AMERICAN MASS SHOOTINGS AT RECORD HIGH, AVERAGE 2 PER DAY
"We had never logged a month of 60+ mass shootings prior to 2020."
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MISSOURI MAYOR WANTS TO GIVE EVERY RESIDENT $1,000 IN BITCOIN, BUT THERE IS A CATCH
"I have friends whose lives have been completely changed, like going from working a regular nine to five job to being worth over 80 million dollars in a matter of a few years."
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Biden cannot control the Military nor the PENTA, he MUST RESIGN: HE is not President
BIDEN DRONE STRIKE REPORTEDLY KILLS MULTIPLE CHILDREN IN KABUL, FAMILY CLAIMS 'NOT ISIS-K'
"...we are not IS-K, we are ordinary people..."
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Keeping this President is a shame to our Nation. Nobody elected this Biden. We demand his resignation! The VP -with new & better advisors- will do a better job.
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GOV. DESANTIS DEMANDS BIDEN ADMINISTRATION CEASE RESETTLEMENT OF ILLEGALS IN FLORIDA
"...the resulting influx of unvetted illegal aliens endangers our national security and undermines the socioeconomic wellbeing of hardworking American citizens,"
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US-WORLD ISSUES (Geo Econ, Geo Pol & global Wars)
Global depression is on…China, RU, Iran search for State socialis, D rest in limbo
"Facts have proved once again that the Afghan war has not achieved its goal of eradicating terrorist forces in Afghanistan and a precipitate withdrawal of US and NATO forces could provide opportunities for various
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VIRAL INFOGRAPHIC REVEALS THE SHOCKING AMOUNT OF MILITARY HARDWARE BIDEN HANDED TO THE TALIBAN
by Tyler Durden
The better to hunt stranded allies with?
When President Biden leaves billions of US military hardware in the hands of America-hating terrorists - after having seven months to "plan a withdrawal" - he doesn't mess around.
According to a now-viral infographic from The Sunday Times, ongoing terror operations will benefit from the luxury of more than 22,000 Humvees, 42,000 pick-up trucks and SUVs, 16,000 night visions goggles and devices, 64,000 machine guns, and 358,000 assault rifles.
See Chart:
Taliban’ New Arsenal
https://cms.zerohedge.com/s3/files/inline-images/74e012219f093a1062b158a93702cee6.jpg?itok=5OKGxR7l
Indeed, while Biden wants to strip law-abiding Americans of their constitutional right to bear arms, he's put over 400,000 of them in the hands of terrorists.
See Chart from Will Brown: “Taliban New Arsenal”
At the SOUIRCE BELOW:
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Finally we accept our successor, though with fear & some doses of xenophobia
CHINA HAS A GRAND STRATEGY TO DISPLACE US: CHINA EXPERT
“If there are two paths to hegemony - a regional one and a global one - China is now pursuing both,”
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For Latino-Am nothing to be fear: China will support again the highway & ferro-via in the transatlantic project with BRA in the South (PE-BOL-CHILE) and in the north the AMAZON project to the Atlantic Ocean. This will unite EC-PE-COL-VEN +BRA. Both projects will change for the better the whole Economy of South America. China will be the main investor and is possible that RU will help too.
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SPUTNIK NEWS : https://sputniknews.com/
- Four Chinese Ships Enter Japan's Territorial Waters Off Disputed Senkaku Islands
- UK in 'Greatest Danger From Terrorism Since Daesh at Its Height'
- Biden Declares Major Disaster in Louisiana Where Ida Leaves Over 1 Million Homes With No Power
- Avani Lekhara Becomes First Indian Woman to Win Gold Medal at Tokyo Paralympics
- Sweden Allegedly Sought to Bomb Afghanistan as Advertisement for Its Fighter Jets,
- Global COVID-19 Death Toll Surpasses 4.5 Million
-WH: Operations at Kabul Airport 'Uninterrupted' After US Air Defence System Repels Rocket Attack
-Palestinian Presid: Israel’s Defense Minister Discuss Security Issues in Rare Meeting
-Biden Refuses to Answer Questions on Afghanistan
--US Drone Strike in Kabul Kills Nine Members of Single Family, Including 6 Kids
-US Successfully Evacuates All Afghan Employees at Kabul Embassy
-Iranian Pres Raisi Appoints UN-Sanctioned Minister to Lead Country's Nuclear Agency
-UNSC Not Holding Discussions on Sending UN Peacekeeping Mission to Afghanistan
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