Former Homeland Security Secretary Jeh Johnson said Saturday that America has a “crisis” at the southern border, and that the number of apprehensions exceed anything he encountered during his time serving under former President Barack Obama.
“By anyone’s definition, by any measure, right now we have a crisis at our southern border,” he said on “Cavuto LIVE.”
“According to the commissioner of [Customs and Border Protection], there were 4,000 apprehensions in one day alone this past week, and we’re on pace for 100,000 apprehensions on our southern border this month.”
“That is by far a greater number than anything I saw on my watch in my three years as Secretary of Homeland Security,” he said.
Johnson’s remarks come after President Trump this week accused Mexico of doing nothing to stop the illegal immigration flow to the U.S. and threatened to close to southern border next week.
….through their country and our Southern Border. Mexico has for many years made a fortune off of the U.S., far greater than Border Costs. If Mexico doesn’t immediately stop ALL illegal immigration coming into the United States throug our Southern Border, I will be CLOSING…..
….the Border, or large sections of the Border, next week. This would be so easy for Mexico to do, but they just take our money and “talk.” Besides, we lose so much money with them, especially when you add in drug trafficking etc.), that the Border closing would be a good thing!
The SEC can play this motherf***king tape in court.
Marshaling his Trumpian knack for distraction, Tesla CEO Elon Musk dropped his first rap single on SoundCloud, an unexpected release that, as at least one twitter wit pointed out, appeared to be calibrated to distract from Tesla’s Q1 Model 3 deliveries (due out this week), and Musk’s myriad other problems (like the SEC suing to hold him in contempt of court for violating the agency’s restrictions on his twitter activity).
The song, titled “RIP Harambe”, was dedicated to the 17-year-old gorilla who was shot and killed by a Cincinnati Zoo worker in 2016 after grabbing a three-year-old boy who fell into his pen. Since his untimely death, Harambe has become a popular meme and even inspiring an online movement (“Dicks out for Harambe”).
The song, released under Musk’s “record label”, Emo G Records, features Musk rapping a catchy, if heavily autotuned, chorus.
“RIP Harambe, sipping on some Bombay/We on our way to heaven, Amen, Amen/RIP Harambe, smoking on some strong, hey/In the gorilla zoo/And we thinking about you.”
The song had been played more than 200,000 times as of Sunday afternoon.
“No media (T.V. Radio, etc.) Black Press Only!” read a sign posted on the door of Bolton Street Baptist Church, the Savannah Morning News reported.
White reporters were denied entry to a meeting to discuss an upcoming mayoral race in Georgia, while black reporters for at least two television stations and the publisher of the black-owned Savannah Tribune newspaper were allowed into the meeting.
Reporters who got inside were prohibited from taking photos, video or audio recording, according to Stephen Moody, an African-American reporter with WJCL who attended the event.
AP reports that Mayor Eddie DeLoach is seeking re-election this fall. He became Savannah’s first white mayor in 20 years after winning the 2015 campaign.
Elections for Savannah’s top office are nonpartisan, meaning all candidates who qualify end up on the November ballot.
Savannah Alderman Van Johnson, one of three black mayoral candidates to have announced campaigns so far, spoke at the meeting about his campaign for mayor, said groups have the right to determine how they assemble. Johnson said afterward he:
…relayed “my vision for an inclusive Savannah, a progressive Savannah.”
Asked by WTOC-TV about only black reporters being allowed inside, Johnson said:
“It’s not my meeting. Again, I was asked to come give a statement, and so I came and I gave a statement.”
Regina Thomas, a former Georgia state senator and one of the incumbent mayor’s black challengers, skipped the church gathering Wednesday. She said the meeting appeared divisive and was scheduled too early in the campaign.
Former Savannah Mayor Edna Jackson declined to comment before going inside, as did Chatham County Commissioner Chester Ellis.
“This is not my idea,” Ellis said.
The question is – is it racist? And what would happen if Trump hung a sign at The White House “white press only”? Yeah, we know, that’s totally different!!
via ZeroHedge News https://ift.tt/2HOclG3 Tyler Durden
The former Nevada state assemblywoman who accused Joe Biden of creepy behavior in 2014 said on Sunday that she wants the former VP and possible 2020 Democratic presidential contender to “acknowledge that it was wrong.”
Eva Longoria (left), Joe Biden, Lucy Flores
Lucy Flores claimed in a Friday Op-Ed in The Cut that Biden crept up behind her at a 2014 political event, grabbed her shoulders, ‘inhaled’ her hair, and then planted a “big slow kiss” on the back of her head.
On Sunday, Flores recounted the incident on CNN‘s “State of the Union” with Jake Tapper, stating that amid the chaos and energy of the event, Biden “very unexpectedly and out of nowhere,” Biden “put his hands on my shoulders, get up very close to me from behind, lean in, smell my hair, and then plant a slow kiss on the top of my head.”
Former Nevada Assemblywoman Lucy Flores alleges Joe Biden kissed the back of her head in 2014 at a campaign rally: “It was shocking because you don’t expect that kind of intimate behavior, you don’t expect that kind of intimacy from someone so powerful.” https://t.co/mgUK3jZBfFpic.twitter.com/1wXq8XMSOv
Biden responded to the allegations at 3AM on Sunday through communications director Bill Russo, saying in a statement: “In my many years on the campaign trail and in public life, I have offered countless handshakes, hugs, expressions of affection, support and comfort. And not once – never – did I believe I acted inappropriately.”
Apparently Biden hasn’t seen footage of himself gently caressing children’s faces or trying to kiss them in front of their parents, or groping women from behind.
Flores responded to Biden’s statement, saying that Biden’s ‘intentions’ don’t matter in comparison to the “women on the receiving end of that behavior,” adding “this isn’t the first time, and it wasn’t the only incident where he was acting inappropriately with women.” She also noted the many documented photos and videos of Biden creeping on people.
Lucy Flores: “Part of the reason why I decided to finally say something is because those behaviors were not being taken very seriously. … I just can’t imagine that there was never a situation where someone said to him, ‘Mr. Vice President, you probably should stop doing that’” pic.twitter.com/6Vt5m5DHrE
When asked what she was looking for from Biden, Flores said “Of course I want him to change his behavior. And I want him to acknowledge that it was wrong. And I want this to be a bigger discussion about how there is no accountability structure within our political space. … We are not protected in politics.”
Lucy Flores: “Of course I want him to change his behavior. And I want him to acknowledge that it was wrong. And I want this to be a bigger discussion about how there is no accountability structure within our political space. … We are not protected in politics” #CNNSOTUpic.twitter.com/WgrPz6iPzk
When asked by MSNBC‘s Chuck Todd about the allegations, Democratic Senator Dick Durbin of Illinois said he “knows nothing” about them, but that “Certainly one allegation is not disqualifying, but it should be taken seriously.”
WATCH: Sen. Dick Durbin (D-Ill.) says he “knows nothing” about allegations over former VP Joe Biden’s behavior. #MTP#IfItsSunday@SenatorDurbin: “Certainly one allegation is not disqualifying, but it should be taken seriously.” pic.twitter.com/38mOTcdtdM
For the past two years, it’s been Trump and Russian collusion all the time, every day, and everywhere we see media bias. Some outlets were more egregious than others in subjecting their audiences to relentless chatter about what they believed to be true, rather than merely reporting the news. Among the many “journalists” who espoused the Democratic Party position on the Mueller investigation, some especially boisterous voices stood out from the crowd. So, in a rather non-scientific study, Liberty Nation republishes a few comments that were quite simply over the top.
But before we get to that, a few salient words of summation are in order. The first come from David Harsanyi who wrote the following for The Federalist:
“Perhaps it was Watergate envy, or bitterness over Donald Trump’s victory, or antagonism towards Republicans in general – or, most likely, a little bit of all the above. But now that Special Counsel Robert Mueller has delivered his report on Russian collusion, it’s clear that political journalists did the bidding of those who wanted to delegitimize and overturn Trump’s election.”
A hostile media environment has yielded much unnecessary angst and vitriol. While some are willing to backtrack their comments a bit, others are holding fast to their original remarks. According to Brent Baker, Vice President for Research and Publications at the Media Research Center, CNN has used the mantra “does not exonerate” 120 times a day since the Mueller probe ended. And MRC’s Rich Noyes wrote that for “roughly three minutes a night, every night, for an astonishing 791 days,” the media has been poking this mystical Russian bear which has turned into – in the president’s words – a Collusion Delusion.
So, without further ado, here are Liberty Nation’s top 10 outrageous media statements about President Trump, his alleged connections with Russia, and a 2016 election conspiracy. This is by no means the be-all and end-all of verbal high crimes and misdemeanors by media elites, but a few of these remarks are real head-shakers.
Number 10: Carl Bernstein, CNN Commentator
“I think the media, the press, has done one of the great reporting jobs in the history, especially of covering a presidency by the most news organizations. Look, let’s look at where disinformation and mistakes and lies have come from. Hasn’t come from the press, it’s come from the President of the United States. And those around him.”
Number 9: Chuck Todd, NBC News
The following is a compilation of Todd using the word “crime” in connection with Trump four times in just one episode of Meet the Press.
“You have the justice department, if you will, in the Southern District of New York, pretty explicitly implicating the president in a crime. Do you believe there is already enough to start an impeachment inquiry? … The one means to dealing when a president commits crimes is through the impeachment process. If you don’t go through it, isn’t this a way of Congress saying ‘yes, he committed some crimes but politically it’s uncomfortable so you know if you are popular enough or if you have a big enough base you can get away with committing crimes.’”
Number 8: David Corn, Mother Jones
“In 2016, Vladimir Putin’s regime mounted information warfare against the United States, in part to help Trump become president. While this attack was underway, the Trump crew tried to collude covertly with Moscow, sought to set up a secret communications channel with Putin’s office, and repeatedly denied in public that this assault was happening, providing cover to the Russian operation. Trump and his lieutenants aligned themselves with and assisted a foreign adversary, as it was attacking the United States. The evidence is rock-solid: They committed a profound act of betrayal. That is the scandal.”
Number 7: Will Bunch, The Philadelphia Inquirer
“[W]e have dramatic evidence of collusion” in addition to “a motive” so we, therefore “have the proof all we need of a scandal that’s arguably worse than Watergate.”
Number 6: Aaron Blake, The Washington Post
“Is there more to the Manafort-Russia ties than we know? Could Carter Page’s own Russia ties have been pursued in a way we simply haven’t heard about? What about George Papadopoulos’s talks with a Russia-allied professor who said Russia had ‘dirt’ on Clinton? Maybe it has something to do with Trump Jr.’s meeting with a Kremlin-backed banker at a National Rifle Association convention? Or the elder Trump’s broader efforts to do business in Russia, through his then-attorney Michael Cohen — possibly including a supposed proposal to give Vladimir Putin a $50 million penthouse in a proposed Trump Tower Moscow?
Mueller has made a concerted effort not to reveal his hand — either publicly, in filings like the Papadopoulos plea deal, or in the questions he has asked witnesses who might leak. Given that, it’s entirely possible there’s a line of inquiry that we’re completely unaware of or know very little about.”
Number 5: Dan Rather, MSNBC Commentator
“A political hurricane is out there at sea for him [Trump]. We’ll call it Hurricane Vladimir, if you will.”
Number 4: Chris Matthews, MSNBC Host
“Mueller reminds me of the starfish which gets itself tightly around the clam and uses all its stuff to weaken and pry open the clam. Now, this is a battle to the death as far as the clam is concerned. If the starfish is able to open him [Trump] even a little bit, he can get him open all the way, and that’s it of course for the clam. He’s the starfish’s lunch.”
Number 3: Joy Behar, The View
“I think they’re all going to end up together in prison and maybe that’s a good thing.”
Number 2: Joe Scarborough, MSNBC Host
“Anybody that writes an op-ed and suggests that Donald Trump has not put himself directly in the target of an obstruction charge is just fooling themselves and some very, very stupid, ill-informed readers.”
Number 1: John Sipher And Steve Hall, The New York Times Op-Ed Contributors
“We like to think of ourselves as fair-minded and knowledgeable, having between us many years of experience with the C.I.A. dealing with Russian intelligence services. It is our view not only that the Russian government was running some sort of intelligence operation involving the Trump campaign, but also that it is impossible to rule out the possibility of collusion between the two.”
And
“However, perhaps the most telling piece of information may be the most obvious. Donald Trump himself made numerous statements in support of Russia, Russian intelligence and WikiLeaks during the campaign. At the same time, Mr. Trump and his team have gone out of their way to hide contacts with Russians and lied to the public about it. Likewise, Mr. Trump has attacked those people and institutions that could get to the bottom of the affair. He fired his F.B.I. Director James Comey, criticized and bullied his attorney general and deputy attorney general, denigrated the F.B.I. and the C.I.A., and assails the news media, labeling anything he dislikes ‘fake news.’ Innocent people don’t tend to behave this way.”
The moment of truth for Turkey’s executive president and currency manipulator-in-chief has arrived.
Turks are voting on Sunday in local elections which President Tayyip Erdogan has described as a matter of survival for Turkey and which were marred by lethal violence that left two party members dead in the country’s southeast.
While Erdogan, who last June won a presidential election which further cemented his rule by gaining executive powers, has become the country’s most popular, yet also most divisive, modern leader, he could be dealt an electoral blow with polls indicating his ruling AK Party (AKP) may lose control of the capital Ankara, and even Istanbul, the country’s largest city according to Reuters.
Erdogan exits a polling station during the municipal elections in Istanbul, Turkey, March 31
And with the stagflating economy in a deep recession following a currency crisis last year which saw the lira lose more than 30% of its value, some voters appeared ready to punish Erdogan, who has ruled with an increasingly uncompromising stance.
“I was actually not going to vote today, but when I saw how much they (AKP) were flailing, I thought this might be time to land them a blow. Everyone is unhappy. Everyone is struggling,” said 47-year-old Hakan after voting in Ankara.
The polling stations closed at 4 p.m. local time in eastern Turkey and an hour later in the rest of the country. While early indications from preliminary vote counts were expected two or three hours after voting closed, though a clear picture would take longer especially if the voting process is rigged, as some have warned may happen.
Ahead of the election, the lira once again tumbled forcing the central bank to briefly hike the overnight swap rate to a ludicrous 1300% and force a short squeeze; however with the elections now over, many expect the currency’s free fall will resume apace as Turkey’s economic woes and runaway inflation are only getting worse. Last week Erdogan blamed the country’s economic woes on attacks by the West, saying Turkey would overcome its troubles and adding he was “the boss” of the economy.
“The aim behind the increasing attacks towards our country ahead of the elections is to block the road of the big, strong Turkey,” Erdogan told a rally in Istanbul on Saturday.
Sunday’s elections, in which Turks vote for mayors and other local officials across the country, are the first since Erdogan assumed sweeping presidential powers last year and will be a reckoning for his government, which has come under fire for its economic policies and record on human rights.
Meanwhile, as on prior elections, Sunday’s vote was marred by violence in the southeast and Istanbul where two members of the small Islamist Felicity Party, a polling station official and an election observer, were shot dead in Malatya province, a party spokesman said. Media reports said one person had been detained. After voting in Istanbul, Erdogan said he was saddened by the incident and that it was being thoroughly investigated. Some 553,000 police and security force members were on duty for the vote nationwide.
Elsewhere, two people were hurt in the town of Diyarbakir, after being stabbed in a dispute between candidates, a hospital source told Reuters, while dozens of people were hurt in other election-related clashes in the southeast.
One person was stabbed as 15 people clashed in a row between candidates in Istanbul’s Kadikoy district, a police source said.
* * *
With all eyes now on the results, defeat in Ankara or Istanbul would end nearly a quarter of a century of rule by Erdogan’s AKP or its predecessors in Turkeys’ two most important cities and deal a symbolic blow to Turkey’s leader; it is unclear if such a result would prompt Erdogan to become less confrontational or seek to further tighten his grasp on control.
Ahead of the vote, the main opposition Republican People’s Party (CHP) and Iyi (Good) Party formed an electoral alliance to rival that of the AKP and its nationalist MHP partners. The pro-Kurdish opposition Peoples Democratic Party (HDP), which Erdogan has accused of links to Kurdish militants, is not fielding candidates for mayor in Istanbul or Ankara, which is likely to benefit the CHP.
“Before, this city did not have the services I have now seen. I gave my vote to the AK Party for services to continue,” said tradesman Haci Ahmet Beyaz, 43.
In typical fashion, in the days leading up to the vote Erdogan held over 100 rallies across the country and blasted his rivals as terrorist supporters and warned that if the opposition candidate wins in Ankara, residents would “pay a price”. His opponents have denied the accusations and challenged his characterisation of the elections as a matter of survival.
“We’re electing mayors. What does this have to do with the country’s survival?” Kemal Kilicdaroglu, head of the CHP, told a rally in Eskisehir.
We will bring you the election results as soon as they are released.
via ZeroHedge News https://ift.tt/2VdVKP3 Tyler Durden
Maybe it’s because she just cost their community 25,000 high-paying jobs (plus hundreds, maybe thousands, of ancillary jobs supporting those workers) by helping to drive Amazon out of New York. Or maybe it’s because, after nearly four months in office, she still hasn’t found space for an office in the Bronx. Or maybe it’s because she’s too busy “engaging” with her nearly 4 million twitter followers to respond to constituents’ messages.
Whatever the case may be, the New York Post reported on Sunday that “Girl from the Bronx” Alexandria Ocasio-Cortez has angered many activists in her district. And now they are complaining to their hometown tabloid that the rep they voted for over Democratic Party leader Joe Crowley has ignored them since arriving in Washington.
AOC
Constituents seeking help from AOC, or her office, for issues involving the preservation of a local animal shelters, cleaning up parks, fixing problems at a local post office branch and forcing Amtrak to clean up graffiti on its property in the borough, have been unable to reach anyone from her team. Calls to phone numbers for her Queens and DC offices lead to automated voicemail services that direct constituents to her website. From there, they can request time to meet with AOC.
“I thought AOC would be our savior, but that’s not the case,” complained Roxanne Delgado, a local activist who said she has tried for months to get in touch with the congresswoman for help saving an animal shelter and to clean up parks in the district.
Delgado, 40, says she has made numerous calls to Ocasio-Cortez’s offices in Washington and Queens and sent a barrage of tweets after the freshman lawmaker encouraged residents during a recent visit to a Bronx public library to hit her up on social media.
When the Post tried to call AOC’s office, it met with a similar response: radio silence.
“NO email or contact on @AOC’s page except DC number which has full #voicemail and no one picks up,” Delgado tweeted on Monday.
The Post made several calls to both the Washington and Queens offices last week. The same recording at both numbers gives Ocasio-Cortez’s Web site and doesn’t allow a caller to leave a message.
Indeed, despite all of AOC’s boasting about being “Alex from the Bronx”….
🎶 Don’t be fooled by the plaques that we got, I’m still / I’m still Alex from the Bronx 🎶 pic.twitter.com/eO68AGxn2z
…Many of her constituents are already convinced that she has abandoned them in favor of appearing on Late Night TV, pushing her ‘Green New Deal’ and planning lunches with Elizabeth Warren.
Another Bronx constituent told a community gathering last month that they needed Ocasio-Cortez for a sitdown with post-office officials to sort out difficulties he was having with mail delivery.
“I want AOC or a representative from AOC to be there,” Anthony Vitaliano, a former cop and Community Board 11 member, said at a Feb. 28 board meeting.
Vitaliano, 78, also wants Ocasio-Cortez to pressure Amtrak to clean up graffiti at property it owns on Tremont Avenue.
“You know, I appreciate what she’s doing, but she has to represent us,” he told the board gathering, where other elected officials – from the city and state but not AOC’s office – sent staffers.
Vitaliano told The Post: “She has to address these local issues. Her district is everywhere else in the US. Her heart is not in The Bronx.”
AOC’s indifference to her constituents’ needs has made some nostalgic for Joe Crowley, the Congressman and boss of the Queens Democratic Party, who always had his people at community meetings, willing to listen to constituents’ concerns.
By contrast, he said, residents’ needs received much more attention under Rep. Joe Crowley, whom Ocasio-Cortez unseated in a surprise primary upset last year.
The longtime congressman’s Bronx district representative, Thomas Messina, regularly attended community board meetings, according to Vitaliano.
“Tommy cared about us,” Vitaliano said.
Further insulting her constituents, Ocasio-Cortez’s team brushed off these complaints when approached by the Post, saying only that they are trying their best to find office space in the Bronx, and that “if anybody has any leads”, to let them know.
via ZeroHedge News https://ift.tt/2CL5fO8 Tyler Durden
Liquidity injections and zero interest rate policies disguise risk and may give a false sense of security…
This risk could not be more evident today. Not only have we seen large downgrades to consensus growth estimates and central banks’ expectations of GDP and inflation, leading indicators also point to a much weaker economy ahead.
There are similarities with 2008 that we should not ignore.
A massive China stimulus inflates risky assets and commodities.
Poor macro and earnings data is ignored by markets assuming that all will improve in the second half of the year.
Yield curves invert. 15 economies now have 30-year yields lower than LIBOR overnight rates.
The figure of negative yield debt rises to $11 trillion.
Financial repression is at all-time highs while leading indicators point to a growing risk of recession.
In the first quarter of 2019, stocks have added $9.3 trillion in market capitalization, bonds have gained almost $2 trillion in value. Meanwhile, the Conference Board Index of leading indicators has plummeted for the major economies. The Citi Economic Surprise Index has also fallen, particularly in March, despite a small bounce in the Eurozone at the beginning of the year. Global trade growth, machine equipment orders and manufacturing indices remain poor… while debt soars to another record-high of $244 trillion according to the Bank of International Settlements and the IIF.
The difference with the Asian or the 2008 crisis is that this time the excess risk is hidden under central banks’ balance sheets and will continue to do so.
So, if risk is hidden under a perennial money supply-growth carpet, why should we worry? Because the endgame is not likely to be a 2008-style bang, but a slow, painful and unstoppable zombification of the global economy. As the evidence of stagnation rises, governments get more nervous. What do they do? Stop the monetary madness? Allow high productivity sectors to thrive? Promote deleveraging and prudent investment? No. More white elephants, massive unproductive spending at the expense of taxpayers and savers in what is likely to be yet another massive transfer of wealth from salaries and savers to governments with fancy names.
Investors are forced into riskier assets for lower returns and the crowding out of productive sectors in favour of government and crony subsidised sectors accelerates, sending money velocity lower, productivity growth collapses and mainstream economists hail the financial repression madness with the excuse that “there is no inflation”, while citizens all over the world complain and demonstrate -rightly- against the rise in cost of living. Intensifying financial repression under the “there is no inflation” excuse is the most ludicrous mantra ever. It is like running a car at full speed down a highway under the premise that “we have not crashed yet”.
Many economists defend the zombification of economies under a false social premise. The argument is the following: What is bad about following the example of Japan? It has low unemployment, its debt is cheap and the economy survives rather well. It is a social contract and debt does not matter.
Everything is wrong with this argument. Japan’s low unemployment has nothing to do with monetary and fiscal policy and everything to do with demographics and lack of immigration. Japan’s low cost of debt is not a blessing. It is the result of using the savings of citizens to perpetuate an almost-Ponzi scheme that does not prevent the country from spending more than 20% of its budget on interest expenses. The idea that it is irrelevant because the Treasury buys more bonds tells us how insane we are defending such policies. It is a massive kick-the-can policy transferring the risk to the next generations. It is no wonder that Japanese citizens don´t spend or invest as much as their central planners would want them too. They are not stupid. They know that the government is going to confiscate wealth via monetary and fiscal means at some point. This endless debt machine makes the economy less dynamic, and stagnation is guaranteed. But the strength of the Yen and the low cost of Japanese debt are only supported by the high level of international reserves and strong financial flows of the country. Japàn keeps its imbalances because it is one of the few that has undertaken this concerted policy of zombification. This cannot be transferred to the rest of the world, because the result would not be Japanese-style stagnation but Argentina-style crisis chain.
The fact that Japan has survived two decades of stagnation with the wrong Keynesian policies should not be an excuse to do the same, but an opportunity to do the opposite.
The idea that Quantitative Easing has failed to spur growth and healthy recovery of the world economy is correct. The thought that the mistakes of quantitative easing are solved by outright currency printing and more government crowding out of the productive economy is simply ludicrous. You do not correct mistakes with a bigger mistake.
via ZeroHedge News https://ift.tt/2WBHOyA Tyler Durden
Ten years after central banks launched the greatest monetary experiment in history, pushing rates to zero or lower in an attempt to reflate away an unsustainable debt load while purchasing $12 trillion in securities to prop up risk assets, we are back where we started with deflation once again emerging as the biggest threat to the world, over $10 trillion in sovereign bonds yielding below 0%, and after a disastrous attempt at renormalizing monetary policy, the market is convinced the Fed will cut rates in the next few months.
But besides the greatest roundtrip in monetary policy over the past decade, few things are as they were in 2009.
To demonstrate that, BofA’s Michael Hartnett has published its latest “Hitchhiker’s Guide to the Investment Universe”, which is a primer for investors on the size, composition, risks, returns, flows, valuations of bond & equity universe. The report also finds that, as expected, Wall Street is still “too big to fail”, “Japanification” of growth and rates is prevalent, tech is dominant, there is $175 trillion of assets, there are 536 zombie companies, tech represents 26% of market cap, analysts miss bond yield forecasts by 100bps annually, and much more.
Below we list 20 stunning facts from the report, highlighting Wall Street life, the investment universe and everything…
1. $175tn: current value of global financial assets, 2X the size of global GDP
Wall St. is still “too big to fail”: The total value of global stocks & bonds outstanding has jumped by 8x since 1990, from $23tn to $175tn today.
Global asset values are 2X the size of the global economy; Global asset values fell in 2018 from $180tn to $175tn. .
Global debt outstanding is now $100tn, up from just $13tn back in 1990; Debt represents 57% of global financial assets.
The value of global equities outstanding has similarly surged from $9tn in 1990 to $75tn today. World stocks equities tripled in value between the Global Financial Crisis (GFC) lows in Mar’09 to their most recent peak of $90tn in Jan’18.
Financial assets are now 200% of global GDP; back in 1990 they were 97%. The most recent peak in financial assets as a % global GDP in 2017 was 226%, just above the 2007 highs.
2. 26%: US tech & e-commerce as % of US equity market capitalization
The past 10 years have witnessed the 2nd great bull market in technology in the past 25 years. In 2018, tech & e-commerce sectors accounted for 26% of total market cap (21% today); rivaling prior sector extreme: in the 2000 dot.com bubble TMT was at 34%; in the 2006 housing bubble financials were 26%, and in 2008 during the China/oil bubble, energy & material sectors @ 24%.
T
3. 7%: US Treasury market owned by China, largest of any country
China, the world’s second largest economy, is the world’s biggest single country foreign owner of US government debt. Pensions & Insurers (17.4%), mutual funds & ETFs (12.7%) and the Federal Reserve (12.6%) hold the most securities outright.
The US Treasury market is by far the largest government bond market in the world accounting for $18.4tn of debt securities: almost $4 of every $10 of government debt outstanding is a US Treasury. The next 4 largest government bond markets are Japan, China, UK & France.
4. 0.2%: the end-2020 consensus forecast for Japan’s 10-year JGB yield
Additionally, every year since 2014 Treasury yields have been forecasted to end each year above 3%; every year they have failed to do so. Across the Atlantic, in the past 6 years the consensus has over-predicted German bond yields by on average 100 basis points. And the forecast for the 10-year JGB yield at the end of 2020 is a pitiful 0.2%. The “Japanification” of global interest rates of the past 10-years thus continues apace.
5. Four deflationary Ds of excess Debt, bank Deleveraging, tech Disruption, and aging Demographics explain the consistent undershoot of inflation expectations.
The inability of monetarism to boost wages and income in the world’s largest economic regions is sparking a populist backlash amongst electorates.
6. There is $11 trillion in global negatively yielding bonds
One reason growth & inflation has disappointed in the past 10 years is the ever-growing level of debt, which is not “multiplying” into economic activity, but is rather leading consumers & companies to increase savings and suppress “animal spirits”. As of Q3 2018 global debt equaled $244.2tn, equivalent to 318% of world GDP.
While debt is at a record high, interest rates are close to record lows. The reason is the unprecedented intervention in debt markets by central banks. “Financial suppression” means there are $11.0tn of bonds trading with negative yields today.
7. 2747bps: the staggering drop in US CCC High Yield bond spreads since 2009
8. 2018: 1st year since 2000 that cash outperformed bonds and stocks
This table shows global cross-asset total returns since 2000, in USD terms. Annualized asset returns since QE began in 2009: US stocks 15%, global HY bonds 12%, Treasuries 2%, cash 0%, commodities -1%. In 2018, cash outperformed bonds and stocks for the first time since 2000.
9. 536: the number of zombie companies in the world, 13% of total
Ominously, low interest rates and the ability of lower-rated companies to issue debt has led to a rise in the number of “zombie” companies, i.e. companies that are extremely indebted and are unable to stay on their feet without the current backdrop of historically low interest rates. In 2018, the number of “zombie” companies, defined as companies with profits (EBIT) less than interest payments totaled 536, not far off the highs seen during the Global Financial Crisis (626).
10. $5.5tn: market cap of US tech sector, >entire market cap of Emerging Markets
he second tech bubble: US tech is now by far the biggest individual sector in the global stock market at $5.5tn market cap, larger than all EM stocks ($5.4tn) and Eurozone stocks ($4.4tn); and 3x the size of all other tech sectors combined.
The second largest equity market, Japan, is almost 8x smaller ($3.3tn) than the US ($25.0tn). Financials ($7.6tn) remain the largest outright global sector but now only account for 16.7% of global stocks, well below their prior peak of 26.1% in Jan’07.
US tech companies account for 5 of the 7 largest companies in the world by market capitalization, and 7 of the top 10 companies in the world are tech companies. Microsoft is the only company to feature in the top 10 stocks throughout the 21st century.
11. 1/3: financials as % market cap >1/3 in Canada, Spain, Italy, Australia, Brazil
Tech (14%) now plays a substantial role in Emerging Markets, but the financial sector (24%) is the main driver of EM; this is a major change from 2008 when energy & resources represented 36% of the EM index. As a result, the catalyst for EM to outperform has shifted from commodity prices to global rates. Eurozone equities are highly cyclical and disproportionately reliant on financials, notably Italy (32%) and Spain (36%). The Eurozone’s next structural bull market awaits the end of the current era of negative interest rates.
12. 4%: Global EPS growth forecast in 2019, down from 24% in 2018
The US economic cycle is set to become the longest in history in July 2019; but US, Eurozone & Chinese growth has repeatedly struggled to exceed expectations. The inability of economic growth to hit “escape velocity” helps explains why global profits have consistently missed expectations, most notably in Europe. Years of big upside surprises to EPS have typically been the results of one-off policy interventions, for example the 2018 US tax cuts.
13. 3498: the level at which the S&P 500 bull market becomes the biggest ever
This chart shows how far equities are from their all-time highs, in US dollar (green = <5% from high, white = 5-20% from high, red = >20% from high). US equity market -3% from all-time high; stark contrast to Japan (27% from high), Eurozone (33%), China (40%), Spain (52%), Italy (62%).
14. 68%: the rise in stock price needed for Eurozone banks to reach old highs
Of particular note, Eurozone banks are still 67% off their all-time highs, Korean industrials 75%, Italian financials 82%, South African materials 81%.
15. 67%: the % of the global equity market >20% away from its all-time high
10 years into the bull market, only 9% indices within 5% of all-time highs, 24% are within 20% and a 67% in “bear markets”, i.e. >20% away from highs.
16. 17bps: the CDS of the “safest” company in the world, Nestle
These tables show the largest 25 companies, ranked by market cap & credit default swap spreads, as well as the most creditworthy countries. Nestle is the creditworthy mega cap in financial markets (CDS = 17bp), Alibaba the least (CDS = 84bp). Switzerland (12bp) overtook Germany (13bp) as the most creditworthy country in May 2018; the least is Venezuela (7760bp, peak was 15559bp in Nov’17). US & European most creditworthy sectors = European & US IG healthcare; least = European discretionary HY, US staples HY (Bloomberg).
17. 2.5%: dividend yield of global equity index, below its historic average of 2.9%
This table shows dividend yields around the world: it shows that global equities currently yield 2.5%. Dividend yields in excess of 3.5% (cheap) can be found in Russia, Australia, UK, Spain, Italy, Taiwan, energy, utilities, REITs. Dividend yields below 2% (expensive): India, US, tech, discretionary, communications.
18. 15X: price-earnings ratio of the global equity index, below its 15.7X average
This table shows price/earnings ratios based on 12-month forward earnings. Global equities are currently trading on a forward P/E multiple of 15.0x. P/E multiples above 17x (expensive): India, US, REITs, staples, tech, healthcare. P/E multiples below 12x (cheap): Russia, Korea, Italy, Brazil, Spain, China, financials.
19. 100: corporate bond prices relative to commodity prices close to 100-year high
This chart shows the performance of US corporate bonds vs. commodities in the past 100 years. US corporate bonds hit an all-time high versus commodities in June 2017, exceeding the prior high set during the Great Depression in 1933; they remain close to that high today.
20. 2002: last time commodities best performing asset class (as they are in 2019)
via ZeroHedge News https://ift.tt/2COxYBI Tyler Durden
With far left candidates and policies on the rise in America, it’s no surprise that for the first time ever, more young people say they’d prefer to live in a socialist country over a capitalist one.
Whether it’s free healthcare, free college tuition, or universal basic income, students around America increasingly support higher taxes on the wealthy in order to pay for these progressive policies. But would they support similar policies if they had skin in the game?
To find out, Campus Reform‘s Cabot Phillips went to Florida International University in Miami to test the waters on a “Socialist GPA” policy in which students with higher GPAs would be forced to “spread the wealth” and give some of their GPA points to students with lower GPAs.
Despite the overwhelming number of students who initially said they’d support socialist policies, few agreed to go along with such a plan.
“I’m all for helping, but I wouldn’t give some of my points… I’ve lost a lot of sleep so I don’t know if that would be fair,” one student said…
…while another answered no because “I like, study all day for my grades.”
Yet another student, after expressing her support for socialism in America conceded, “I guess it would be kind of hypocritical for me to say no.”
Another student, trying to justify his refusal to abide by such a policy, said, “you study for your grades, and they reflect how much time you’re studying.”
What did the rest of the students have to say when asked why it was any different when it came to spreading the financial wealth?
WATCH:
via ZeroHedge News https://ift.tt/2CHhM59 Tyler Durden
