Fri
SEP 28 18 SIT EC y POL
ND denounce Global-neoliberal debacle y propone State-Social
+ Capit-compet in Econ
ZERO HEDGE ECONOMICS
Neoliberal globalization is over. Financiers know it, they
documented with graphics
For the
latest confirmation of the upside down market, look no further than corporate
bonds.
For the latest confirmation of the upside down market, look
no further than corporate bonds where the riskiest, CCC-rated junk bonds are
set to make a positive return for the 3rd consecutive year, the longest winning streak since
records began in 1997.
See Chart:
Not only have the lowest quality junk bonds, those rated CCC
or lower, generating respectable absolute returns of 5.8% YTD, they have also outperformed higher
quality debt with a 1% total return so far this month, according to Bloomberg and ICE data. Additionally, the
lowest rated junk bonds have also outperformed the broader junk bond index,
which has returned 1.9% YTD.
See Chart:
And while the key contributor to the outperformance of
lowest-rated bonds is demand for, well, higher yielding paper as investors
continue to chase returns, a key structural issue has been the lack of HY
supply, which at $150
billion YTD is the lowest since 2009.
Continuing a theme we first highlighted
in June, when we showed the "odd
divergence" of IG bonds spreads widening even as junk bond spreads touched
record lows...
See Chart:
... junk bonds have continued to enjoy unprecedented demand
(and the abovementioned record winning streak) while high
grade corporate bonds are set for their worst year since 2008, with returns for
the space down 2.34% so far in 2018.
See Chart:
As shown in the chart above, while high-grade bond returns
have been mostly positive since the financial crisis, the increasingly hawkish
Fed has taken its toll this year, and with three rate hikes in the rear-view
mirror and more to come, investors are getting out of low-yielding fixed-rate
bonds - which traditionally underperform in rising rate environments as
yields increase across the board - choosing either junk
bonds or floating rate loans. No surprise then that the best performing asset classes in credit
include high-risk, high-yield CCC debt and floating-rate leveraged loans.
Curiously, the negative
returns for IG bonds - which have been largely used to finance another year of
record mergers - haven't resulted in lower demand or
slowed new issuance: according to Bloomberg, September was the highest
volume month of 2018, with $122.7 billion pricing so far.
As Crombie summarizes these trends, "investors are like
all others - they pursue returns. That means more money chasing a
limited supply of increasingly risky bonds, and probably an uglier end to this
credit cycle."
Meanwhile, as junk bond supply remains subdued, the ongoing
record wave of mergers, most of which are funded with IG debt, will see no
shortage of lower-yielding paper; additionally high grade bonds will
increasingly face a lot of competition, especially if the Fed keeps hiking
rates and shrinking its balance sheet. This will
continue until, eventually, the Fed triggers an "event" that forces a
broad market repricing, one which see staggering losses in junk, and forces
yield chasers into more safe places along the capital structure.
…
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US
DOMESTIC POLITICS
Seudo democ duopolico in US is obsolete; it’s full of frauds
& corruption. Urge cambio
Chairman
Grassley called an immediate vote to advance Kavanaugh, which was approved 11-10
RELATED
"I
support the FBI having an opportunity to bring some closure to this."
[ So,
it could come the revenge of the ‘guardians of Law’.. the FBI. They can do the
right investigation and they can do the reverse (case Trump vs Hillary &
RU) and fry the life of an entire family (Kavanaugh’) just because an invented
sex scandal that never had legal consistent evidence. If “assault” is the uses of violence for sex (before, and during
sex) .. then where is the evidence of such thing happens in this case?.. Where
is the injure or blood sign of such violence?. Why the ladies didn’t quit from the party and denounced to
the police? Why 3 decades later they do so. The answer is: Simply because now
this is a political issue. An issue related to the corrupt political power in which everything is touched by big money, starting
by the current press paid to swallow this fake story. Remember: there are foundations
like the one owned by Clintons’ –who has been accused of sex scandal- covering up
these issues via corrupted press. ( Are
they involved again in this press-scandal?
Who knows?). Now the FBI will re-take this matter in their hands .. just when
the whole nation has been skewed against the Judge K. FBI mission is to protect
US Law: Will they do it fine in this skewed context? I hope so. If they can’t
many people will demand the re-organization of this Institution Top-down.. if they
take side in an issue that if highly political. Whatever is related to power
system is politics. Trump’ proposal of Kavanaugh can’t be discussed –is his
right- no way to dumped easily and without consequences. ]
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US-WW ISSUES (Geo Econ, Geo Pol
& global Wars)
Global depression is on…China, RU, Iran search for State
socialis+K-, D rest in limbo
The last time we saw this trifecta... was 2H
2014, and the dollar
rallied by 25%...
Macrostrategy
Partnership writes about perhaps the most important chart of the decade...
See Chart:
Policy
divergence is now set to accelerate the US$ rally.
The Fed is in a battle with an overheating
US economy, where a 4% of GDP fiscal stimulus meets an economy with more job
vacancies than unemployed.
Lael Brainard’s recent speech highlights that the Fed is now looking to hike
rates above long-term neutral levels.
…
SOURC E: https://www.zerohedge.com/news/2018-09-28/trumps-imperial-circle-or-most-important-chart-world
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US intel
official: Netanyahu's UN comments 'somewhat misleading': "US intelligence official says
Americans have known about it 'for some time', stresses that 'it’s full of file cabinets and paper, not aluminum
tubes for centrifuges."
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"Either the Fed stops and China stimulates, or accidents happen."
See Chart:
... US$ liquidity is negative (vs
growth of ~5%- 6% in ‘17) and money supply (down to 4-5% vs double-digit growth
in late ‘17).
See Chart:
G5+China M2 has fallen over the last
four months by over US$2 trillion. At the same time, CBs are gradually pushing
up the cost of capital.
See Chart:
.. while both OIS Libor and TED
spreads remain relatively placid, and the US high-yield market continues to
enjoy some of the lowest ever spreads (~3.2%). It applies even for CCC &
below debt (~6.6%).
See Chart:
.. but
complacency keeps returning as inflation remains subdued
Although one could highlight some specific measures (e.g.
IMF rescue of Argentina or tightening in Turkey), we believe that returns to
complacency are primarily due to a deeply held view that CBs would never allow
any meaningful break-out of volatilities, and would step-in with either liquidity
supports and/or end of tightening while as long as the US
domestic economy is strong, the risk appetite is expected to prevail. If we dig
deeper, investors seem to agree with us that overleveraging, lack of clearance
of past excesses & disruption are generating such strong headwinds, that
break-out of excessive wage inflation is unlikely, even as markets tighten. This in turn, limits
the degree of damage to margins or rise in the cost of capital, except
for the most marginal of cases.
The role of the Fed and China is particularly important. It
seems that the Fed is only focusing on domestic strength, while ignoring global
tightening. As long as it continues to view the world through one-dimensional
lenses, the non-US world
runs a risk of significant contraction, which in turn would return to haunt US. Similarly, while recent actions have stabilized China’s
credit impulse, it does not yet represent a substantive policy shift.
While most investors worry about ’19-20, we remain far more concerned what
would happen over the next six months. Either the Fed stops and China stimulates, or accidents happen. EMs
still look very vulnerable; but ‘19-20 might not be bad years, as either
normality returns or Fed pulls back. Systemic failure is not an option.
….
….
SOURCE: https://www.zerohedge.com/news/2018-09-28/global-liquidity-eroding-fast-nothing-breaking-yet
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SPUTNIK and RT SHOWS
GEO-POL n GEO-ECO
..Focus on neoliberal expansion via wars & danger of WW3
Fate
of Nusra terrorists in Idlib. Lavrov said that terrorists must be either destroyed or prosecuted
by court, he underscored. "We won't allow the repetition
of Raqqa scenario,"
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Lavrov at
UNGA: Russia Warns Against New Chemical Weapon Provocations in Syria https://sputniknews.com/world/201809281068427733-lavrov-un-general-assembly-russia/
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According to the US Constitution, "no person
holding any office of profit or trust… shall, without the consent
of the Congress, accept of any present, emolument, office, or title,
of any kind whatever, from any King, Prince, or foreign state."
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RT SHOWS
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NOTICIAS IN SPANISH
Lat Am search f alternatives to neo-fascist regimes &
terrorist imperial chaos
Brecha
salarial: Los hombres 1 euro, las mujeres 0,89
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RT reporta Perú: Retos de género
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COUNTER PUNCH
Analysis on US Politics & Geopolitics
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David
Rosen Is
the U.S. in a Pre-Fascist Period?
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George
Faraday Trump
is Subsidizing Companies That Send Jobs Overseas
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GLOBAL RESEARCH
Geopolitics & Econ-Pol crisis that leads to more
business-wars from US-NATO allies
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DEMOCRACY NOW
Focus on Trump policies & the Econ & Pol crisis
inside US
Despite
‘Gut-Wrenching Testimony from Dr. Blasey Ford’, GOP Moves Forward with Vote on
Kavanaugh
Democy Now is politically lined against Kavanough without said any leg-evidence
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Brett
Kavanaugh Barely Controls His Rage in Combative Testimony Denying Sexual
Assault Allegations He and his
family has been offended so nasty.. Is there a human able to cont rage
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PRESS TV
Resume of Global News described by Iranian observers..
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