Staff of @VP announce Vice President Mike Pence called back to Washington cancels NH trip, was a “situation” that required Air Force 2 to return to DC. #nhpolitics
Though the language is less ominous, but only slightly.
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Vice President Mike Pence has been called back to the White House on Tuesday because of an undisclosed “emergency,” NBC 10 Boston reports.
Pence had been scheduled to land in Manchester around 11:25 am, but instead, just before he was due to land, news broke that his event had been cancelled and that he would be heading back to Washington instead of making an appearance in New Hampshire to discuss the opioid crisis.
Happening Today:
– @VP Mike Pence will travel to New Hampshire to meet with former patients and alumni at the Granite Recovery Center HQ before delivering remarks about the opioid crisis
– Senator Bernie Sanders to reveal Q2 fundraising at 10am EST #2020Election@OANN
At the end of a long, tiring day, we may choose to treat ourselves to a soothing bubble bath. Surrounded by steaming water and a froth of sweet-smelling bubbles, it’s easy to forget the cares of everyday life.
This fact is equally true of economic bubbles. When the markets are up, we’re inclined to feel as though life is rosy. Unfortunately, it does seem to be the norm that investors fail to recognize when a healthy up-market transforms into a dangerous bubble. We tend to be soothed into overlooking the fact that we’re in hot water, and economically, that’s not an advantageous situation to be in.
Periodically, any economy will experience bubbles. It’s bound to happen. Human nature dictates that, if the value of an asset is on the rise, the more success it experiences, the more we want to get in on the success.
Sadly, the great majority of investors have a tendency to fail to educate themselves on how markets work. It’s easier to just trust their broker. Unfortunately, our broker doesn’t make his living through our success; he makes it through brokering transactions. The more buys he can encourage us to make, the more commissions he enjoys.
It’s been said that a broker is “someone who invests your money until it’s gone,” and there’s a great deal of truth in that assessment.
And so, we can expect to continue to witness periodic bubbles in the markets. They’ll occur roughly as often as it takes for us to forget the devastation of the last one and we once again dive in, only to be sheared once again.
But we’re presently seeing an economic anomaly – a host of bubbles, inflating dramatically at the same time.
The Stock Market Bubble
Only a decade ago, stocks plummeted and billions were lost by investors. But then, before the system could be cleansed of the detritus, more money was artificially pumped into the system and stocks began to rise again.
Margin debt is now at an all-time high and complacency is at a maximum. The present condition looks quite a bit more like 1929 than 2008, and the stock market is overdue for a crash. This time, it promises to be much greater than before, as the debt that’s fueling the bull market is at a level that’s historically unprecedented.
Back in 1929, communications were poor and stock market trades were recorded in handwritten ledgers. Today, the recording is entirely electronic, and in addition, in order to minimize losses, the investor may have his broker set electronic stops that will ensure that a given stock is offered on the market automatically, if it drops below the stop price.
This works quite well as long as times are good, but, if there were to be a crash, what it means is that, even if a crash were to be triggered in the middle of the night, when everyone is asleep, the market would awake in the morning to a sudden collapse, as prices blew through the stops of countless investors.
Therefore, the collapse would be much swifter and much more severe than in 1929.
The Bond Market Bubble
This bubble could just as easily be termed a “debt bubble,” as bonds are simply a promise to pay a debt at a future date. (It’s important to note that the bond market consists of a far higher level of investment than the stock market and therefore has the potential to do far more damage in a crash.)
Bonds may be issued by companies, municipalities or central governments. By far, the largest portion of the bond market is that of Treasuries, or government-issued bonds.
Since 1944, the US has been in the catbird seat in the world, as its dollar has been the world’s default currency. But, as the US has, in recent decades, increasingly abused that privilege, the rest of the world has been looking for ways to extricate itself from this economic stranglehold.
With the introduction of new central banks in Asia, plus the new CIPS system (an alternative to the monopolistic SWIFT), it’s become increasingly possible for the East to wean itself from the dollar. Increasingly, this has meant dumping US Treasuries back into the system.
Bonds are presently in a bubble of epic proportions, and with every month, the foundation underneath them is crumbling more, due to ever-increasing dumping.
Even the perma-conservative Alan Greenspan now states that, “We are in a bond market bubble… Prices are too high… The bond market bubble will eventually be the critical issue.”
The Real Estate Bubble
In 1999, the Fed, then under Alan Greenspan, convinced the US president to repeal the Glass Steagall Act, freeing the banks to create the types of loans that helped cause the Great Depression. This, of course, led to the real estate crash of 2007, but instead of the banks going belly-up, they were rewarded for their misdeeds through bailouts that were paid for by taxpayers.
Consequently, although there was a significant correction in real estate prices, this didn’t result in prices dropping to fair value.
They have once again risen and, at this point, are overdue for a major correction. That correction is now well under way. Since it has begun at a time when other markets are also in peril, the level of bailout required for all of them at the same time is impossible to achieve.
Had each of these markets been allowed to collapse in the normal manner, as would occur in a free-market system, they would have done so at levels below the present ones and would have done less damage when they burst. Additionally, each bubble would have burst at its own, logical time.
Instead, all are being propped up artificially, far beyond their natural sell-by date.
For this reason, they’re so over-inflated that, when one bubble is popped, it’s all but certain that they’ll all go down together.
And so, effectively, the financial world is in a bubble bath. The investor is surrounded by soothing bubbles, each of which is rising, reassuring him that his investments are growing.
Although it should be clear to him that he’s in hot water, the majority of investors are holding on to their bonds, rubbing their hands over the rising sale prices of homes in their neighbourhood and considering taking out a loan to buy more stocks on margin.
The collapse will therefore come to most as a complete surprise.
Economic bubbles are normal. They’re created by the lack of forethought that’s common to human nature.
But the present bubble bath is an anomaly without precedent and, as such, promises to result in a crash of unprecedented proportions.
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Excessive money printing and misguided economic ideas have created all kinds of bubbles. All signs point to this trend continuing until it reaches a crisis… one unlike anything we’ve seen before. That’s exactly why Doug Casey and his team just released an urgent video that explains how and why this is happening… and what comes next. Click here to watch it now so you can be prepared.
via ZeroHedge News https://ift.tt/2RPB26Z Tyler Durden
After failing to push through her pick to succeed Jean-Claude Juncker at the helm of the European Commission, ‘lame duck’ German Chancellor Angela Merkel is instead proposing a more palatable pick to succeed Mario Draghi at the ECB.
Virtually guaranteeing that the Draghi-era stimulus will only accelerate, Merkel and several other officials involved in the selection process have settled on IMF head Christine Lagarde. BBG described Lagarde’s candidacy as “one of the key pieces in the latest slate of candidates for the EU’s top jobs which leaders, lawmakers and parties have been wrangling over since Sunday.”
It’s fair to assume that Lagarde would kick the central bank’s money-printing into high gear. Though she has on occasion expressed skepticim, she has also praised the PBOC and its untrammeled stimulus.
More recently, during an interview with CNBC back in April, Lagarde warned that the global economy is mired in a “delicate moment” and that Trump’s trade wars are responsible for these problems. This was around the time the IMF issued its latest slashed forecasts for global growth.
With so many investors, banks, businesses ad others desperately hoping that the world’s central banks will keep the economic expansion alive, instead of deliberately killing it.
Though they recently feuded over Merkel’s plan to install Franz Timmermans as the European Commission’s next president, apparently, the leaders of the eurozone’s two largest economies have reached a compromise to fill the two most important bloc-level jobs, including Draghi’s soon to be vacant post.
German defense minister Ursula von der Leyen is emerging as the latest frontrunner to lead the commission after eastern member states and the EPP, Europe’s center-right political party, objected to a package floated over the weekend that would have seen Dutch socialist Frans Timmermans take that post.
Officials in Berlin say that Chancellor Angela Merkel is a fan of Lagarde and she would enjoy widespread support from among the governing Christian Democrats. The combination of Lagarde and Von der Leyen however was proposed by French President Emmanuel Macron in a conversation with Merkel on Monday night, an EU official said.
Of course, under the European tradition of filling these jobs by horse-trading, Lagarde’s candidacy must be accepted by all parties alongside the nominees to the four other key bloc-level posts. Fortunately, Lagarde reportedly enjoys wide-ranging support among the center-right and center-left in the EU Parliament.
Given her embrace of aggressive stimulus, Lagarde’s appeal is expected to be broad as most bloc leaders are hoping to save Europe from the brink of yet another recessionary slip. That’s something Bundesbank President Jens Weidmann, a notorious hawk, should keep in mind: Now’s not the time for ‘normalization’. And after Mario Draghi’s latest “whatever it takes” moment, whoever leads the central bank next will be under tremendous pressure to maintain the status quo.
via ZeroHedge News https://ift.tt/2YrxgTN Tyler Durden
As markets cross the halfway point for the year, other than a minor pullback in May, it’s hard to argue against the first six months as being anything but spectacular for global assets.
According to Bank of America, the S&P 500 posted the best June return (+6.9%) since 1955. Meanwhile, as Deutsche Bank notes, besides the thrust of the move, it was the broadness of returns which stands out. If we exclude currencies, then 37 of the 38 assets in Deutsche Bank’s sample which cover a variety of asset classes have delivered positive total returns in local currency terms. In other words, just one asset class is down YTD (read on to find out which).
That’s the best start to a year through the first half in terms of broadness of returns since at least 2007. As for June, well this proved to be a microcosm of the year so far with all 38 assets ending the month with a positive total return. If one looks at monthly data back to the start of 2007, “this has only ever happened once before” according to Deutsche Bank’s Craig Nicol. Amazingly, that was back in January of this year.
In other words, January and June of this year are the only months in the last 150 which have seen all assets post a positive total return. Quite remarkable. Given that the USD weakened during June, it’s perhaps
of little surprise to hear that all 38 assets also had a positive total return in dollar
adjusted terms too.
Looking at last month’s equity performance, aU.S. equities were the clear winner, +18.5% on a total return basis, with the equal-weighted S&P 500 gaining even more (+19.6%), despite small caps underperforming large caps. Global equities lagged US equities, but still posted healthy gains (+16.3% in local currency terms and +16.6% in USD). Long-term treasuries also rose 10.9% as the 10-year yield fell 68bps, while gold gained 10.2%. The VIX index averaged 15.9 in 1H, 4% below 2018’s average.
But as DB notes, the most notable aspect of the moves last month was that it wasn’t a traditional risk-on rally that one might expect. For instance Gold (+8.0%) was the second best performing asset. Silver (+5.1%) also posted a reasonable return while Bunds (+1.1%) hit record lows and Treasuries (+0.9%) broke below 2% at the 10y level. Even a traditional safe haven currency like the JPY (+0.4%) was stronger. This all happened for a reason: central banks are back, and expected to flood the world with more cheap money before they start buying up everything that isn’t nailed down.
Interspersed between those moves though were a fairly wide range of returns for equity markets. At the top end we had the FTSE MIB return +7.6% followed by the NASDAQ (+7.5%), S&P 500 (+7.0%) and Hang Seng (+6.7%). In Europe the STOXX 600 finished in the middle of the pack with a +4.5% return while at the bottom the Portugal General (+2.2%) and European Banks (+1.6%) lagged – the latter clearly impacted by the move lower in rates.
Meanwhile, topping the June leaderboard was oil with WTI rallying +9.3% as tensions in the Middle East rose towards the end of the month. EM equities (+6.3%), EM bonds (+4.7%) and EM FX (+2.2%) all got a boost from that move along with the weaker USD. As for credit, it was another month of solid but unspectacular returns. US and EUR HY for example returned +2.5% and +2.2% respectively, while US and EUR IG returned +2.7% and +1.6% respectively.
As for Q2, the May dip wasn’t enough to offset the strong performance in April and June. In local currency terms 31 out of 38 assets had a positive total return while 32 did so in dollar adjusted terms. The big winners were Greek and Russian equities, returning +21.7% and +13.4% respectively. DM equity markets posted much more modest returns. The DAX (+7.6%) was the big outperformer with the STOXX 600 returning +3.4% and S&P 500 +4.3%. European Banks (-0.9%) underperformed. As for bonds, Treasuries and Bunds returned +3.1% and +2.0% respectively, with Spanish (+5.5%), EM (+5.1%) and BTPs (+3.7%) delivering solid returns also. In terms of where that left credit, returns spanned from +1.7% to +4.9% with US outperforming EUR and IG outperforming HY.
Finally, the leaders YTD are still the Greek Athex (+43.1%), WTI (+28.8%) and Brent (+23.7%). In terms of the main equity markets, the NASDAQ (+21.3%) leads the way with the S&P 500 up +18.5% and STOXX 600 +17.2%. US and EUR HY have returned +10.1% and +7.4% respectively while in bond markets Treasuries and Bunds have returned +5.3% and +4.2% respectively.
Finally, for those asking, the only asset that remains down in 2019 is – drumroll – Silver (-1.2%).
via ZeroHedge News https://ift.tt/2RT9Zb8 Tyler Durden
Russia’s Defense Ministry has confirmed to Interfax and TASS that 14 Russian Navy crew members have died as a result of a fire on one of its deep-sea research submersibles.
The accident is reported to have occurred in Russian territorial waters while the crew was carrying out a survey on July 2, and though little information has as yet been given, it’s believed that the sailors died as a result of smoke inhalation.
File photo: Russian Northern Fleet
The submersible is reported to currently be at a Russian Navy base in the northwestern city of Severomorsk, and the incident is subject of an ongoing investigation.
The fire broke out Monday while the submersible was in Russian territorial waters, the military said. The sailors extinguished the fire and the ship has since returned to port in Severomork, Russia, according to the military, The Associated Press reported.
The main base of Russia’s Northern fleet is located at Severomorsk, in the Murmansk region.
In 2000 the Kursk submarine was destroyed by an explosion in the Barents Sea – among Russia’s most devastating naval accidents – which killed 118 crew members.
Example of a small sized Russian submersible made for 3 crew members, via BBC
Incidentally, for the grammar nazis, a ‘submersible’ differs from a submarine in that it requires a support vessel on the surface, and though much smaller has similar deep underwater exploration capabilities as a sub.
via ZeroHedge News https://ift.tt/2KV0048 Tyler Durden
As OPEC+ proudly announces it is extending its production cuts into 2020 (while desperately talking down US shale production), in a last-ditch attempt to support prices, the slew of dismal manufacturing data in the last 24 hours has sparked selling in oil.
“Although a truce has been called between U.S. and China, global manufacturing is in a very bad shape,” said Tamas Varga, an analyst at brokerage PVM Oil Associates Ltd.
WTI is back below $58, erasing all post trade-truce and OPEC-deal gains…
As global manufacturing appears to enter a recession…
Saudi Arabian Energy Minister Khalid Al-Falih said the OPEC+ pact was just the start of a long fight to contend with booming American production…
As Bloomberg notes, the OPEC pact leaves the door open for U.S. shale producers to grab more market share, as the group will have to cut deeper to achieve inventory targets, according to Goldman Sachs Group Inc. The decision creates a clearer downside risk to the bank’s forecast for Brent to average $60 a barrel next year, even though it could result in some shorter-term price spikes.
via ZeroHedge News https://ift.tt/2KUYKOs Tyler Durden
A chain of events set off by Senator Chuck Schumer (D-NY) over competing border funding bills served to undermine his longtime ally, House Speaker Nancy Pelosi (D-CA) – a rare rift between the old friends which may put a strain on their working relationship in the months to come, according to The Hill.
The wheels started turning when Schumer became one of 33 Democrats to vote for the bipartisan Senate bill, even though Pelosi had let Senate negotiators know that she wanted to make important changes to the legislation.
The strong Democratic support for the Senate spending bill then emboldened a group of moderate House Democrats to balk at changes favored by Pelosi and House liberals that would have put greater restrictions on money headed to the border to better protect migrants. –The Hill
In short, Schumer’s support of the Republican-backed Senate bill completely hand-grenaded Pelosi’s.
Pelosi, faced with an internal revolt, caved to pressure and eventually accepted the Senate bill despite her objections over what she felt were insufficient protections for migrants.
“This seems to be the only time I can remember in the last two years or three years where Sen. Schumer and Speaker Pelosi were not on the same page,” a House aide told The Hill, who added that a broad swath of Democrats are sour at Schumer for undercutting their position. The aide referred to it as a “unique situation,” however, since many moderate House Democrats favored the Senate’s bill as well.
“I don’t think it will be repeated again,” said the aide. “The things coming down the pipeline are much bigger, more fundamental issues,” referring to upcoming negotiations between the three branches of government over the debt ceiling.
The aide predicted that it would be difficult for Senate Majority Leader Mitch McConnell (R-Ky.) to “jam the House on a $1.3 trillion spending bill.”
“There are so many equities involved on both the House and Senate Democratic sides it’s unlikely the House Democratic position could be ignored,” the aide added.
A Pelosi spokesman offered a similar assessment, noting the unique dynamics of the migrant debate coming amid news of horrific conditions at the border — news that broke after the Senate had advanced its bill through committee. –The Hill
According to the aide, the upcoming debate over the debt ceiling will be “totally different,” since Democrats are far more aligned on their priorities on this issue, while Republicans are divided over the issue.
“There are different leverage points on that,” said the aide. “In those talks, Schumer and Pelosi have been in lockstep.”
Pelosi needs to be more proactive in order to avoid being railroaded again by the Senate, according to longtime Republican clerk and House Appropriations Committee staff director, Jim Dyer, who said “It might serve as a lesson about the importance that when two bodies are negotiating on these things that you’ve got to get yourself in earlier.”
Pelosi’s poor grasp of the situation and Schumer abandoning her gave a decisive victory to Senate Majority Leader McConnell, who said last Thursday “I’m proud of the Senate for stepping up, passing a bill 84 to 8, that’s as bipartisan as it gets around here, to deal with the humanitarian crisis at the border. We did not in the end continue to play these political games over this humanitarian crisis. They did and it’s their problem to resolve.”
House liberals, meanwhile, are reportedly furious at Schumer for not pushing back more against McConnell, as a closer Senate vote (it passed 84 to 8) may have given Pelosi more leverage to negotiate for more protections for migrant children.
“If you heard how often our Republican colleagues invoked the vote out of the Senate, it obviously significantly undermined our leverage and our ability to keep these important protections in the bill,” said Rep. David Cicilline (D-RI).
And according to The Hill, ‘A growing public clamor for action worked against Pelosi and House liberals.”
“You had two events in the public eye in the last week or so that got the average person saying, ‘Holy God, something’s got to be done.’ And the second was the reports of inhumane treatment of children at that facility in Texas,” said Dyer. “Democrats and Republicans, alike, are not immune to it and the push is we’ve got to do something and we’ve got to do it fast.”
via ZeroHedge News https://ift.tt/327mnIY Tyler Durden
A former University of Chicago medical patient filed a class-action lawsuit against the University of Chicago and Google, claiming that the University of Chicago Medical Center is giving private patient information to the tech giant without patients’ consent.
About two years ago, the university medical center partnered with Google with the hope of identifying patterns in patient health records to help predict future medical issues.
Now, former patient Matt Dinerstein is filing a lawsuit on behalf of the medical center’s patients, alleging that the university violated privacy laws by sharing sensitive health records with Google from 2009 to 2016, aiding Google’s goal of creating a digital health record system, according to the Chicago Maroon.
The suit alleges that the university deceived its patients by telling them that their medical records would be protected, but ultimately violated the Health Insurance Portability and Accountability Act (HIPAA), a federal law that ensures privacy and security for personal medical data. It also claims that UChicago violated state laws in Illinois that makes it illegal for companies to participate in dishonest client practices.
The complaint details Google’s alleged two-part plan: obtain the Electronic Health Record (EHR) of almost every patient at the UChicago Medical Center, then use the information to create its own lucrative commercial EHR system.
“While tech giants have dominated the news over the last few years for repeatedly violating consumers’ privacy, Google managed to fly under the radar as it pulled off what is likely the greatest heist of consumer medical records in history,” the complaint stated.
“The compromised personal information is not just run-of-the-mill like credit card numbers, usernames and passwords, or even social security numbers, which nowadays seem to be the subject of daily hacks.”
“Rather, the personal medical information obtained by Google is the most sensitive and intimate information in an individual’s life, and its unauthorized disclosure is far more damaging to an individual’s privacy.”
Dinerstein’s lawsuit claims that EHRs contain patient information ranging from height and weight to diseases they carry such as AIDS or diabetes and medical procedures they have undergone.
The medical records include the demographics of patients, along with their diagnoses, prescribed medicine, and past procedures, the lawsuit alleges. According to the Department of Health and Human Services, HIPAA protects patients’ “individually identifiable health information,” which includes “demographic data, that relates to…the individual’s past, present or future physical or mental health or condition, the provision of health care to the individual, or the past, present, or future payment for the provision of health care to the individual.”
“The disclosure of EHRs here is even more egregious because the University promised in its patient admission forms that it would not disclose patients’ records to third parties, like Google, for commercial purposes,” the lawsuit continued. “Nevertheless, the University did not notify its patients, let alone obtain their express consent, before turning over their confidential medical records to Google for its own commercial gain.”
Google detailed its use of EHRs, including ones obtained from the University of Chicago, in a 2018 research paper. The Big Tech company claimed that there are no privacy concerns because the records did not include the identities of patients.
Although Google claims to lack the personal identity associated with each set of information, the complaint calls this a “false sense of security” for patients, since Google’s comprehensive data-mining abilities, along with the time and date of each treatment and notes from medical providers that the records allegedly contained, allow them to identify each individual.
“While this type of public misinformation campaign may be expected from a tech company that has been known to play fast and loose with the information of its customers, the fact that a prominent institution like The University of Chicago would act in such a way is truly stunning,” the complaint said.
According to the lawsuit, Google has been interested in using algorithms to predict looming health issues. To gain the necessary information, Google first developed a personal health information storage platform that it later discontinued because few consumers participated. The company then bought DeepMind, a startup that uses artificial intelligence (AI) to study health care, reported the Chicago Tribune.
UChicago is not the sole institution that has collaborated with Google regarding medical information. Stanford University and the University of California, San Francisco have similar partnerships, according to the research paperpublished by Google.
Campus Reform reached out to UChicago for comment bud did not receive a response in time for publication.
In a statement to Campus Reform, a Google spokesperson maintained that no laws were violated and that multiple individuals and boards vetted the agreement.
via ZeroHedge News https://ift.tt/2Xhz2FJ Tyler Durden
In what China’s Foreign Ministry spokesman Geng Shuang slammed as “an ugly act of hypocrisy” on Tuesday, Beijing slammed London and Washington for meddling in its domestic affairs after Western politicians backed massive protests in Hong Kong, which spiraled into clashes with police after demonstrators stormed the city’s parliament.
Beijing’s Hong Kong and Macau Affairs Office had blasted Britain, along with the US and the EU, for their position on the Hong Kong protests on Tuesday, accusing them of generating fake news. Without naming the US or Britain, the agency demanded “the relevant countries to immediately stop making false statements and actions that undermine China’s national security and Hong Kong’s prosperity and stability.”
Shuang also voiced “strong dissatisfaction and resolute opposition to one country’s gross interference in Hong Kong affairs and China’s domestic affairs.”
“We once again warn [all] countries to be careful and not interfere in Hong Kong’s domestic affairs in any way”, Geng said, after earlier stating that Britain has “no so-called responsibility” for its former colony Hong Kong and urged London “to know its place” and stop meddling in the tensions there.
Over a million people began marching and staging a sit-in protest in downtown Hong Kong in late-June, denouncing a since-suspended bill that would allow extradition of locals to mainland China. The peaceful protests escalated into sporadic clashes with police, which culminated on Monday when the protesters broke into the city’s parliament building. The rally that day coincided with the anniversary of Britain returning Hong Kong to China in 1997.
Predictably, British Foreign Secretary Jeremy Hunt backed the protesters, saying that London’s support for the city and “its freedoms is unwavering.” and on Monday, Hunt wrote on twitter that “No violence is acceptable but HK people MUST preserve right to peaceful protest exercised within the law, as hundreds of thousands of brave people showed today.”
Away from campaigning want to stress UK support for Hong Kong and its freedoms is UNWAVERING on this anniversary day. No violence is acceptable but HK people MUST preserve right to peaceful protest exercised within the law, as hundreds of thousands of brave people showed today.
A similar stance was taken by Washington. President Donald Trump, who met Chinese leader Xi Jinping at the G20 event in Japan over the weekend, said that the protesters in Hong Kong are “looking for democracy.” I think most people want democracy. Unfortunately, some governments don’t want democracy.
Brussels called on all sides “to exercise restraint,” and “to engage in dialogue and consultation” in order to defuse the crisis.
via ZeroHedge News https://ift.tt/327jzvq Tyler Durden
