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Two-thirds of business economists in the US expect a recession to start in the second half of 2020 according to the National Association for Business Economics (NABE), while a majority of respondents say President Trump’s trade war is the greatest threat to the most extended bull market ever. About 10% believe the next economic downturn could begin in 2019, 56% say 2020, and 33% said 2021 or later, according to the August 28-September 17 poll of 51 economists issued by the NABE, as per Bloomberg.

41% of economists said the most significant downside risk was trade policy, followed by 18% of respondents indicating the Federal Reserve’s interest rate hikes, and the same amount saying it could be a stock market repricing event or volatility shock.

“Trade issues are clearly influencing panelists’ views,” David Altig, Federal Reserve Bank of Atlanta research director and NABE’s survey chair, said in a statement with the report.

Bloomberg said the economic expansion became the second-longest in May (and will become the longest on record next summer) with no significant warning signs yet and Fed officials upgrading growth forecasts for this year and next — what could go wrong?

If the expansion continues into mid-2019, it could become the nation’s longest ever, based on data from National Bureau of Economic Research figures that date back to the mid-1850s.

Despite data already showing Trump’s trade aggressive tariff policies slowing global growth momentum, disrupting global supply chains, and repricing markets in some developed world but most emerging markets, economists have maintained their rosy forecasts for the US economy, as nothing in their models indicate danger.

Meanwhile, 33% of respondents said the most significant potential driver of stronger economic performance is Trump’s tax cuts (increased financialization: stock buybacks, M&A, dividends, etc…), 27% cited wage increases and 10% said stronger global growth.

Overall, the economists were more pessimistic than optimistic about their assessment of potential risks to expansion, as the cycle has been overextended thanks to quantitative easing programs via the Federal Reserve and now fiscal stimulus via Trump’s tax cuts.

Fed policy makers said “risks to the economic outlook appear roughly balanced” in their statement last week while raising their 2018 growth estimate to 3.1% from 2.8% in prior forecasts and 2019 to 2.5% from 2.4%. Fed officials also raised the main interest rate by +25bps to a target range of 2% to 2.25%, this year’s third hike.

“Respondents in NABE’s survey indicated they expect the Fed to raise interest rates once more this year and three times in 2019, consistent with projections from central bankers. The poll’s median estimate for the target range midpoint at year-end rose to 2.375%, equivalent to one more 25bps hike this year, from 2.21% seen in the earlier survey,” said NABE.

As the storm clouds gather with the threat of a recession, the US economic expansion is becoming increasingly mature, as capacity utilization increases, above-potential growth becomes more difficult to achieve. Moreover, as the cycle matures, and monetary accommodation removed, lessening the tailwinds for the US economy. NABE’s polling data shows that economists overwhelmingly understand that the next recession is approaching, and investors should now pay up for safety.

Meanwhile, all signs confirm – Goldman’s protests notwithstanding- that the economy is in a “late cycle” stage, with BofA showing that the US equities versus Global equities’ gap is extremely wide. The US is being priced for perfection by economists drinking the Fed’s Kool-Aid.

A flattening yield curve typically reflects decreasing growth expectations and the threat of risk aversion, which tend to have an amplifying effect on volatility.

Record multiple for US stocks

Record leverage for small caps:

Market Breadth deteriorating as S&P500 races to ATHs:

What comes next?

Societe Generale thinks the peak in the US economy was in 2Q, and it will be all downhill from here, with GDP set for a sharp drop one year from now.

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Authored by Caitlin Johnstone via Medium.com,

If there’s one thing that brings a tear to my eye, it’s the inspiration I feel when watching Republican-aligned neoconservatives and Democrat-aligned neoconservatives find a way to bridge their almost nonexistent differences and come together to discuss the many, many, many, many, many, many many many things they have in common.

In a conference at the Gerald R. Ford School of Public Policy, “Resistance” leader and professional left-puncher Neera Tanden met with Iraq-raping neocon Bill Kristol to discuss bipartisanship and shared values. While leprechauns held hands and danced beneath candy rainbows and gumdrop Reaper drones, the duo engaged in a friendly, playful conversation with the event’s host in a debate format which was not unlike watching the Pillsbury Doughboy have a pillow fight with himself in a padded room after drinking a bottle of NyQuil.

To get the event started, the host whose name I refuse to learn asked the pair to discuss briefly what common ground such wildly different people could possibly share to make such a strange taboo-shattering dialogue possible.

“Issues around national security and believing in democratic principles as they relate to foreign policy,” replied Tanden. “And opposing authoritarianism, and opposing the kind of creeping populism that undermines democracy itself.”

Neera Tanden, in case you are unaware, is a longtime Clinton and Obama insider and CEO of the plutocrat-backed think tank Center for American Progress. Her emails featured prominently in the 2016 Podesta drops by WikiLeaks, which New Republic described as revealing “a pattern of freezing out those who don’t toe the line, a disturbing predilection for someone who is a kind of gatekeeper for what ideas are acceptable in Democratic politics.” Any quick glance at Tanden’s political activism and Twitter presence will render this unsurprising, as she often seems more concerned with attacking the Green Party and noncompliant progressive Democrats than she does with advancing progressive values. Her entire life is dedicated to keeping what passes for America’s political left out of the hands of the American populace.

Kristol co-signed Tanden’s anti-populist rhetoric and her open endorsement of neoconservative foreign policy, and went on to say that another thing he and Tanden have in common is that they’ve both served in government, which makes you realize that nothing’s black and white and everything’s kinda nebulous and amorphous so it doesn’t really matter if you, say for example, help deceive your country into a horrific blunder that ends up killing a whole lot of people for no good reason.

“I do think if you’ve served in government -this isn’t universally true but somewhat true- that you do have somewhat more of a sense of the complexity of things, and many of its decisions are not black and white, that in public policy there are plusses and minuses to most policies,” Kristol said.

“There are authentic disagreements both about values, but also just about how certain things are gonna work or not work… and that is what adds a kind of humility to one’s belief that one is kind of always right about everything.”

I found this very funny coming from the man who is notoriously always wrong about everything, and I’d like to point out that “complexity” is a key talking point that the neoconservatives who’ve been consistently proven completely wrong about everything are fond of repeating. Everything’s complicated and nothing’s really known and it’s all a big blurry mess so maybe butchering a million Iraqis and destabilizing the Middle East was a good thing. Check out this short clip of John Bolton being confronted by Tucker Carlson about what a spectacular error the Iraq invasion was for a great example of this:

I listened to the whole conference, but it was basically one long smear of amicable politeness which was the verbal equivalent of the color beige, so I had difficulty tuning in. Both Tanden and Kristol hate the far left (or as those of us outside the US pronounce it, “the center”), both Tanden and Kristol hate Trump, and hey maybe Americans have a lot more in common than they think and everyone can come together and together together togetherness blah blah. At one point Kristol said something about disagreeing with internet censorship, which was weird because his Weekly Standard actively participates in Facebook censorship as one of its authorized “fact checkers”.

The buzzword “bipartisan” gets used a lot in US politics because it gives the illusion that whatever agenda it’s being applied to must have some deep universal truth to it for such wildly divergent ideologies to set aside their differences in order to advance it, but what it usually means is Democrat neocons and Republican neocons working together to inflict new horrors upon the world. America’s two mainstream political parties agree furiously with one another on war, neoliberalism, Orwellian surveillance, and every other agenda which increases the power and profit of the plutocratic class which owns them both. The plutocrat-owned mass media plays up the differences between Democrats and Republicans to hysterical proportions, when in reality the debate over which one is worse is like arguing over whether a serial killer’s arms or legs are more evil.

Neera Tanden and Bill Kristol are the same fucking person. They’re both toxic limbs on the same toxic beast, feeding the lives of ordinary people at home and abroad into its gaping mouth in service of the powerful. And populism, which is nothing other than support for the protection of common folk from the powerful, is the only antidote to such toxins. Saying populism undermines democracy is like saying democracy undermines democracy.

*  *  *

Thanks for reading! The best way to get around the internet censors and make sure you see the stuff I publish is to subscribe to the mailing list for my website, which will get you an email notification for everything I publish. My articles are entirely reader-supported, so if you enjoyed this piece please consider sharing it around, liking me on Facebook, following my antics on Twitter, checking out mypodcast, throwing some money into my hat on Patreon or Paypal,buying my new book Rogue Nation: Psychonautical Adventures With Caitlin Johnstone, or my previous book Woke: A Field Guide for Utopia Preppers.

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Following the announcement of Nafta 2.0, or the United States Mexico-Canada Agreement (USMCA), liberal news outlets CNN and Axios published articles suggesting that Trump’s negotiation tactics might just be working. 

In a Tuesday article, CNN contributor David Andelman asks “What if Trump’s confrontation trade stance actually works?” – which suggests that after USMCA was announced, “Trump largely got his way. And now, no one can tell him his bull-in-a China-shop way won’t work.” 

Axios’s Jim VandeHei and Mike Allen offer similar analysis in their piece entitled, “The Trump way often works.” 

For a left-of-center publication like Axios to publish an acknowledgement of Trump’s successes is interesting, however for the insurgent “alt-left” at CNN, even admitting that Trump’s tactics might be working is quite frankly shocking – even if it’s an Op-Ed. 

 Trump’s unhinged-from-precedence-in-your-face negotiating style actually works.

Indeed, Sunday evening, a senior American official came right out baldly and boasted to the Wall Street Journal that the new pact was “a template for the new Trump administration playbook for future trade deals.” The official might even have left off “trade.” This kind of bludgeon-thy-neighbor tactics could work quite well, thank you, in dealing with most of the adversaries Trump has created or confronted in his first two years in office.

All three countries — the US, Mexico and Canada — were characterizing it as a win-win-win. But the leading French daily Le Monde called it like they saw it: “Trump imposes on Canada a new free trade accord.” –CNN

CNN continues: 

there is a host of other multinational agreements Trump has scuttled with the aim of redrawing them to America’s advantage. And that now seems to be a not impossible dream. Europe, as well as Russia and China, is united in the desire to snatch some sort of victory out of Trump’s withdrawal from two critical non-trade pacts, the COP-21 Paris climate accord and the Iran nuclear pact. Now, it would seem, with the NAFTA and KORUS victories, there is even less incentive for Trump to budge a jot from his long-held and barely tenable positions.

Axios notes that while “it drives the media, Democrats and more than half of America mad,” Trump’s “jam-your-opponent style can be effective.” 

Via Axios: 

What he’s done: He erased NAFTA, as a word, and replaced the trade pact with a different name (the United States-Mexico-Canada Agreement, or USMCA) and better terms for America. Sure, he infuriated Canada and Justin Trudeau, but he delivered the goods. (And helped some farm-state candidates just before midterms.)

• His tax cut, jammed through last year, continues to juice a red hot economy that has consumers confident, stocks soaring, joblessness sinking. 
• His wild, improvisational press conferences and rallies still grab massive audiences — and drive the media conversation. 
• And his no retreat, no surrender approach has helped Brett Kavanaugh survive brutal hearings, and put the conservative judge on the cusp of a lifetime Supreme Court seat.

The White House says it’s as simple as Trump sticking to, and delivering, what he promised — defying low expectations amid chaos and distractions.

A veteran Democratic presidential adviser said that the Trump formula is taking a clear position and driving toward it — making sure everyone knows where he stands, and only focusing on one or two policy goals at a time.

• The adviser pointed to the cap on deductibility of state and local taxes — included in Trump’s tax-reform plan — as an enviable achievement.
• “Presidents going back to Ronald Reagan have tried to do this,” the Democrat said. “He had the determination and skill to get it done. Clinton didn’t. Obama didn’t.”

After his surprise NAFTA win, Trump was sunny at the White House yesterday, and preened at a rally in Tennessee last night about his dominance in news coverage:

• “You know what it’s called? Earned media,” he said. “And I earned it.”

With midterms 35 days away, there’s some evidence that Trump’s recent campaign to make this election about his favorite topic — him — plus the court fight has Rs more energized than at any point this year.

• Polling has swung sharply against Sen. Heidi Heitkamp (D-N.D.), with analysts pointing to Kavanaugh’s popularity in the state as a factor.
• Trump’s message and travel have greatly strengthened Republican Senate challengers in Missouri, Montana and West Virginia.

The last time left-wing media praised Trump was when he convinced NATO member nations to chip in their fair share.  

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Authored by Zachary Garris via The Mises Institute,

It seems like the media will never stop promoting the myth that public school teachers are “underpaid.” The most recent example is the front-page story in Time, “This Is What It’s Like to Be a Teacher in America.”

Time tells of a woman who makes $55,000 per year teaching but works two other jobs in order to “pay the bills.” The article includes complaints about a teacher making almost $70,000 per year and even suggests that sexism is partly to blame for deficient pay because there are more women teachers than men.

It is no surprise that the media promotes these sorts of stories. They want public elementary and secondary school teachers to make more money. Unfortunately, it is probably not for the reason they want us to think. For if the media cared about teachers as a class, they would also advocate for private school teachers (who make far less than public school teachers on average). There is something about public education that concerns them.

The likely explanation for why the media constantly tell us that public school teachers should be paid more is that teachers unions and the media are political allies. It is no secret that the teachers unions have strong ties to the Democratic Party . And the mainstream media, including publications like Time, leans to the political left.

What About Private School Teachers?

Of course, the media can successfully push for greater pay for public school teachers because they are paid through taxation, while private school teacher pay is dictated by consumer demands. This is the difference between taxation and voluntary exchange. The amount of money raised by taxation can be almost unlimited regardless of the utility provided, while the government’s subsequent expenditure is arbitrary in both quality and quantity, without any connection to consumer valuation.

This is the great irony of the claim that public school teachers are underpaid. By socializing education, state governments have removed the very market forces that determine wages. So there is no way to measure what a teacher actually ‘should’ be paid.

There are private schools in America, but these schools are an imperfect measure of teacher pay because the government’s quasi-monopoly on education decreases demand for private education. Parents are much less likely to pay for private schools when “free” public schools are readily available. Those who send their children to private schools effectively pay double tuition, as they must continue to pay property taxes for public schools that they do not use.

Public School Teachers Are Overpaid

However, a comparison between public and private schools suggests the opposite of what the media claims. It is not that public school teachers are paid too little. Rather, public school teachers are paid too much. It is quite certain that few kindergarten teachers would be making anywhere near $70,000 per year in a free market of education. Yet wealthy school districts can pay this much because the revenue from property taxes is so high.

We can know that public school teachers on average make too much money because government employees in general make more than their private-employee counterparts . Government employees, including public school teachers, receive hefty pensions and insurance packages as part of their compensation. These benefits, as well as the favorable hours and extensive vacations, are often left out of discussions of teacher pay.

The wage premium of public school teachers is primarily due to the government’s quasi-monopoly of education and the high revenue brought in by taxation. In addition, teachers unions have decreased competition and driven up wages by lobbying for unreasonable state certification standards (usually requiring a degree through a university’s college of education rather than mere proficiency in the subject taught).

Of course, some teachers would be paid a high wage in a free market. However, this would be the best and most skilled teachers, not just those who teach for many years and receive automatic annual pay increases (a practice that was negotiated by unions). The current public school system actually discourages teacher development by rewarding the number of years worked instead of the individual’s performance.

Only the Free Market Can Determine Wages

The central point is that a school system that is exempt from market forces is unable to calculate the market value of schooling and the wages of the teachers who provide their services. Instead, teacher salaries are determined by government bureaucrats, and these vary widely by state and district.

Public school teachers are not “underpaid.” No one knows what they should be paid because there is no free market to address this question. However, we can be sure that many public school teachers are earning far more than they would be if exposed to market demands, where schools seek to provide the best education for the lowest cost. Free choice in education would link a teacher’s pay to the value of his or her services, in contrast to the current coercive system that pays many teachers more than their productivity justifies.

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The results of a recently opened FBI investigation into claims of sexual misconduct against Brett Kavanaugh will be made available to the Senate, but not the public, according to Senate Majority Leader Mitch McConnell (R-KY). 

“We’ll get an FBI report soon. It will be made available to each senator and only senators will be allowed to look at it,” McConnell told reporters on Tuesday, adding “That’s the way these reports are always handled.” 

An FBI investigation was launched after Senator Jeff Flake (R-AZ) derailed Kavanaugh’s confirmation by refusing to vote “yes” pending a probe demanded by Senate Democrats.

The White House and Republican senators asked the FBI to reopen a background investigation on Kavanaugh the day after Flake’s line in the sand, as Flake and two other GOP senators remain undecided on Kavanaugh’s confirmation pending the results of the FBI’s investigation. 

Ford detailed her accusations during dramatic testimony last week in front of the Senate Judiciary Committee, claiming that Kavanaugh pushed her onto a bed and began to grope her. She says she was able to get away when Kavanaugh’s friend, Mark Ford, jumped on the bed and sent them flying. 

The FBI will reportedly conclude their probe by Wednesday according to the Wall Street Journal, in a Tuesday report that hit just minutes after Ford’s lawyers sent a letter to FBI Director Christopher Wray claiming that their client had yet to be interviewed. 

“it has been five days and no interview yet?” reads the letter. 

Letter sent today to FBI Director Christopher Wray from Christine Blasey Ford’s attorney. pic.twitter.com/yEidNOvQCo

— Jason Leopold (@JasonLeopold) October 2, 2018

That said, other reports have already proclaimed that Ford’s testimony at the last week was sufficient, which, as WSJ reports, means this may be over by tomorrow…

People familiar with the process said Tuesday that the FBI investigation into the allegations of sexual misconduct against Judge Kavanaugh could wrap up very soon, well ahead of the end-of week deadline.  

GOP aides on the Hill and another person familiar with the process said they were expecting the bureau to conclude its report as soon as late Tuesday or early Wednesday.

Agents had interviewed at least four key people as of Tuesday in its background investigation of Judge Kavanaugh. The White House had given the bureau until Friday to wrap up the probe.

Senators would then be shown the FBI’s findings, but it wasn’t clear if the public would get a look as well.

Senate Majority Leader Mitch McConnell (R., Ky.) said on Tuesday the report was expected “soon” and “will be made available to each senator and only senators will be allowed to look at it.”

And after that – the big debate will be whether it is made public…

Senate Judiciary Chairman Chuck Grassley (R., Iowa) said that in his 38 years on the Senate, “an FBI report, as far as I know, has never been made public” and that it could hurt the FBI in future investigations if the report was made public.

The top Democrat on the committee, Sen. Dianne Feinstein of California, said “it depends” and she thinks a report it “should be limited” to the committee. She said in her past experience that is what has been done, but she was not clear on the format the FBI would release the results of its investigation.

So after the entire edge-of-the-seat public circus, it appears that the FBI isn’t going to interview Ford, and whatever they conclude won’t be made public unless some Senator leaks it. 

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Authored by Jeff Thomas via InternationalMan.com,

In recent decades, political correctness has been very much on the rise in the countries that were formerly regarded as the “free world.”

It’s important to remind those who live in these countries (North America, Europe, etc.), that political correctness is not by any means as prevalent in the rest of the world.

In fact, the further removed a country is from the influence of the EU and US, the less prevalent political correctness is.

The EU and US are, in fact, the epicentre of this movement… This is no accident.

So, should political correctness be forcibly controlled? Well, no. If someone wishes to adopt a belief, regardless of whether we find it silly, pointless, or even offensive, that should unquestionably be their right.

But, is there a point at which political correctness becomes dangerous? Yes, decidedly so. It becomes dangerous when it becomes sanctimonious and aggressive – it then morphs into what I term “sanctimania.”

Sanctimania can be defined as the point at which personal opinion encroaches upon the personal liberty of others; when the other person’s rights are aggressed upon or removed in the name of the opinion being expressed.

Sanctimania is, by its very nature, the point at which anger overcomes reason and force is employed in order to achieve social change.

To be sure, the anger and intolerance that typify sanctimania, taken together, are a most powerful force. As Mahatma Gandhi said,

“Anger and intolerance are the twin enemies of correct understanding.”

Anger has a way of taking personal viewpoint to a destructive level. And, in fact, throughout history, we’ve seen political leaders repeatedly whipping their followers into anger in order to seize greater control. Certainly, this was true in virtually every speech given by Adolf Hitler. It was used extensively by Maximilien Robespierre following the French Revolution. And, not surprisingly, it has been employed in political demonstrations and riots throughout history.

Confucius, a fellow who had a reputation for careful reflection, said,

“When anger rises, think of the consequences.”

A good point. It’s invariably true that no emotion has the ability to eliminate reason and self-control like anger. And this, of course, is why political leaders so often seek to create anger amongst their followers – so that they can be trained to do the bidding of the leaders without questioning either the validity of their actions or the consequences.

Well, what, then, are the benefits of this anger? Does it achieve its end? Does it typically convert or defeat the adversary? Let’s query Buddha on that one.

“Holding onto anger is like drinking poison and expecting the other person to die.”

Quite so. Of course, Buddha was referring to the consequence upon the person who is angry, not the consequence upon the person who inspired him to anger. The person who inspired the anger is not harmed at all.

So, is there a difference between anger and sanctimania? Most decidedly so. Sanctimania is a refinement of anger. It’s the better tool for political leaders seeking to control their followers.

Any political leader wishes to create in the minds of his followers a separation of opinion. He creates rhetoric that’s intended to set his followers apart from others. That rhetoric is intended to have the appearance of a moral high ground. Once the followers believe that they’re morally apart from others – once they’ve reached the stage of sanctimony, they’ve fallen under the control of the leader. Whether he’s Vladimir Lenin, George Patton or Jim Jones, both the purpose and the method are the same.

And it’s important to state that it doesn’t matter whether the sanctimonial intolerance comes from the political left or right, although there can be no question that collectivist leaders have historically made greater use of it.

But sanctimania takes the rhetoric to the final stage. Whether it’s as minor as beating up someone for being a ginger in the UK, or whether it’s stoning a woman to death for the crime of infidelity, as in Leviticus, 20:10, sanctimania represents the power of the leader to control the aggression of the follower without question; without reason.

Quite a powerful political tool.

At present, we’re viewing this phenomenon as an extension to political correctness. Whereas ten years ago we might have seen a man being reviled for making a sexual advance to a female co-worker, or using a pejorative with regard to someone of a different race or ethnic background, we’re increasingly seeing these “crimes” elevated to the point that punishment is being called for.

The buzzwords are familiar to us all – racist, sexist, homophobic, fascist, hate, etc.

It matters little whether the person being attacked is actually “guilty” of the entire list. If he’s identified as being objectionable for any reason, he’s then tarred with the entire list. Conversely, if another individual has been accepted within the group, should he actually be guilty of any of these “crimes,” this fact is ignored. He’s a “good” person.

Historically, Jews have been made the target of Christians and vice-versa. Blacks have been made the target of whites and vice versa. Conservatives have been made the target of liberals and vice versa.

Whenever in history political leaders have used the media to create a campaign against a given group or groups, the objective has been to create sanctimania as a vehicle by which increased control may be implemented. In the eye of the leader, it truly has nothing to do with one group being superior to the other. (In fact, the group could be chosen at random and the outcome would be the same.)

The objective is to create alienation.

Whether we assess Fidel Castro in his frenzied all-day speeches against the greedy capitalists, the Ayatollah Khomeini railing against infidels, or Al Gore creating fear of global warming from nothing, what we’re witnessing is a leader creating sanctimania.

When we see large demonstrations of people with placards aggressing against others in reaction to such rhetoric, we’re witnessing the intended product of sanctimania.

But, if we’re able to step back a bit and take a deep breath, we’ll hopefully remind ourselves not to fall into the trap of taking the opposing view of the sanctimaniacs just because we find their behavior offensive.

Instead, we’ll hopefully remove ourselves from the field of rhetoric entirely and reach our conclusions through objective reasoning. This is not just a helpful lesson in objectivity – it’s a survival technique, as, historically, periods of sanctimania are often followed by periods of great unrest.

Once sanctimania results in general chaos, the objectivity that we’d practiced may well determine whether we will become casualties of sanctimania or whether we’ll quietly remove ourselves from the fray.

*  *  *

Clearly, there are many strange things afoot in the world. Distortions of markets, distortions of culture. It’s wise to wonder what’s going to happen, and to take advantage of growth while also being prepared for crisis. How will you protect yourself in the next crisis? See our PDF guide that will show you exactly how. Click here to download it now.

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What happens when prices rise so high that a chasm forms between bids and asks? The market grinds to a halt.

That’s what happened in Vancouver housing in September, when according to the Real Estate Board of Vancouver (REBGV), residential property sales tumbled by 17.3% from August 2018, and a whopping 43.5% from one year ago. In fact, a total of only 1,595 transactions took place as both buyers and sellers continue to sit on their hands amid confusion whether the recent torrid price gains will continue or whether the housing bubble has burst.

Sales of detached properties in July was just 508, a decrease of 40.4% from the 852 recorded in September 2017, and the 812 apartments sold was a 44% drop compared to the 1,451 sales in September 2017.

And no, it’s not seasonal: last month’s sales were a whopping 36.1% below the 10-year September sales average.

The reason for the collapse in transactions: the formerly all too willing buyers, mostly Chinese oligarchs who would use Vancouver real estate as their offshore Swiss bank account, have disappeared. Meanwhile sellers are dumping properties in the market in hopes of a quick flip.

“Fewer home sales are allowing listings to accumulate and prices to ease across the Metro Vancouver housing market,” Ashley Smith, REBGV president-elect said. “There’s more selection for home buyers to choose from today. Since spring, home listing totals have risen to levels we haven’t seen in our market in four years.”

Sure enough, there were 5,279 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service in Metro Vancouver in September 2018. This represents a 36% increase compared to August 2018 when 3,881 homes were listed. Separately, the total number of properties currently listed for sale in Metro Vancouver was 13,084, a 38.2% increase compared to September 2017 (9,466) and a 10.7% increase from just one month prior, when 11,824 properties were listed in August 2018.

Curiously, despite the dramatic slowdown in the market, prices remained at nosebleed levels suggesting that sellers are still not in a rush to sell. The composite benchmark price of a home was just over C$1 million, a three per cent decrease over the past three months but up 2.2 per cent from September of 2017.

Detached homes sold for an average of C$1.541 million, down 4.5% from a year ago, and apartments averaged C$687,00, up 7.4% from July 2017. The overall composite benchmark price fell just 0.6% in July to C$1.09 million, which is still up 6.7% from a year earlier, up 3.1% over the last three months, and remains unreachable for most ordinary buyers.

The report signals buyers are still adjusting to tougher mortgage qualification rules the federal government introduced Jan. 1, and more worryingly, to the four increases in the Bank of Canada’s interest rate over the past year. Those rules were put in place after surging prices in both Toronto and the Pacific coast city led to warnings about excessive speculation.

“Metro Vancouver’s housing market has changed pace compared to the last few years. Our townhome and apartment markets are sitting in balanced market territory and our detached home market remains in a clear buyers’ market,” Smith said. “It’s important for both home buyers and sellers to work with their Realtor to understand what these trends means to them.”

Other levels of government have also cracked down. British Columbia’s provincial government imposed a tax on foreign buyers, and Vancouver is trying to deter property speculators with a levy on vacant homes.

So will prices catch up to the collapse in sales? According to the REBGV, for all property types, the sales-to-active listings ratio for September 2018 is 12.2%. By property type, the ratio is 7.8% for detached homes, 14% for townhomes, and 17.6% for condominiums.

Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12% mark for a sustained period, while home prices often experience upward pressure when it surpasses 20% over several months.

In other words, with the surge in detached listings coupled with the lack of declining prices, all that Vancouver’s real estate market needs is a spark that launches the selling deluge; however since the bulk of purchases were made “all cash”, and in most cases sight unseen by Chinese oligarchs, it is unlikely that further monetary tightening will be the catalyst that finally pops one of the world’s biggest housing bubbles.

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Russia has formally announced that delivery of its feared S-300 surface-to-air missile system to the Syrian government is now complete. “The work was finished a day ago,” Defense Minister Sergei Shoigu told President Vladimir Putin during a televised meeting on Rossiya 24 TV on Tuesday, and noted that hardware supplied to Syria consists of 49 pieces of military equipment, including radars, control vehicles and four launchers.

The declaration comes after Russia’s Foreign Minister confirmed that transfer was in progress last Saturday, and that the move will “be devoted to ensure 100 percent safety and security of our men in Syria, and we will do this.” Moscow has followed through on its prior vow to move “swiftly and appropriately” in response to Israel’s massive September 17 airstrikes on Syria which resulted in the accidental downing of a Russian reconnaissance plane with 15 people on board by Syrian defenses. 

Last Monday the Defense Minister indicated delivery would happen “within two weeks” — thus it appears Russia began prepping the transfer immediately. Russian advisers will now train Syrian personnel to operation the new weapons, which is expected to take up to a few months, with the likelihood that Russians will man the active systems in the meantime. 

Middle East based journalist Danny Makki noted that “it will take 3 months for Russians to train Syrian teams on S300 air defense system,” and that it’s “fair to assume that for that period the Russians will be operating the S300.” Russian media reports say the system is expected to be fully operational by October 20.

Israel had expressed regret over the incident but ultimately blamed Syrian and Iran for the mishap in a series of IDF statements. PM Netanyahu had dispatched a high level delegation to Moscow immediately after the incident to mend relations, but apparently to no avail. Up until this week it was unclear whether Putin would actually go through with delivery of the advanced S-300 system — a huge upgrade to Syria’s current ailing Soviet-era defenses — which both Israel and the United States have called a “provocation” and “significant escalation” (in Bolton’s words), and urged Russia not to got through with it. 

Last week, an Israeli official said called the S-300 system in Assad’s hands “a complicated challenge” for Israel, and added, “We’re dealing with it in different ways, not necessarily by preventing the delivery,” in a clear compromise compared to prior statements of Netanyahu who had called S-300 delivery a “red line” in tandem with calling out Iran’s troop presence in Syria, for which Israel must act militarily.

But now clearly Putin is in the driver’s seat and showed himself unmoved by Israeli threats to continue to act in Syrian territory even after the S-300 gets installed. President Trump also recently stated that the US “fully supports” Israel’s actions.

The chief worrisome game changer for Netanyahu is that — as a Haaretz report noted previously — the range of the new defense system will give Damascus the ability to detect potentially hostile aircraft from point of origin inside Israel: “With Putin’s S-300, Assad’s army could even ‘lock-on’ IAF aircraft as they take off from bases within Israel.” And as one Israeli defense analyst put it, “Israel should be worried.”

Russia has further notified the world that it would help Syria blanket the coast and its sovereign territory with an “electronic umbrella” of new electronic countermeasures, which will allow the Syrians to “suppress satellite navigation, onboard radar systems and communications of warplanes attacking targets on Syrian territory.”

And Syria for its part has signaled to the Israelis that it’s essentially gameover. Syria’s Deputy Foreign Minister Faisal Mekdad recently said that “Israel, which has gotten used to carrying out attacks under various pretexts, will now have to weigh and rethink before attacking again.” He told the Chinese news agency Xinhua: “The aggression against Syria is directed towards the forces that are fighting against terrorism in Syria. If Israel will try to attack we will defend our people as we did in the past.”

The Israeli Defense Forces (IDF) over the summer confirmed that it had struck targets inside Syria over 200 times within just the last year alone. But it now appears those days are over. 

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The Senate Judiciary Committee has released a letter from former meteorologist and former Democratic candidate for Maryland’s 8th district, Dennis Ketterer, who claims that Brett Kavanaugh’s third accuser and Michael Avenatti client, Julie Swetnick, was a group-sex enthusiast that he initially mistook for a prostitute at a 1993 Washington D.C. going-away party for a colleague. 

“Due to her having a directly stated penchant for group sex, I decided not to see her anytmore” -Dennis Ketterer

Ketterer writes that Swetnick approached him “alone, quite beautiful, well-dressed and no drink in hand.” 

“Consequently, my initial thought was that she might be a high end call girl because at the time I weighed 350lbs so what would someone like her want with me?”  

The former meteorologist then said that since “there was no conversation about exchanging sex for money” he decided to keep talking to her, noting that he had never been hit on in a bar before. 

Over the ensuing weeks, Ketterer claims that he and Swetnick met at her residence for an extramarital affair that did not involve sex. 

“Although we were not emotionally involved there was physical contact. We never had sex despite the fact that she was very sexually aggressive with me.

…

During a conversation about our sexual preferences, things got derailed when Julie told me that she liked to have sex with more than one guy at a time. In fact sometimes with several at one time. She wanted to know if that would be ok in our relationship.

Ketterer claims that since the AIDS epidemic was a “huge issue” at the time and he had children, he decided to cut things off with Swetnick. He goes on to mention that she never said anything about being “sexually assaulted, raped, gang-raped or having sex against her will,” and that she “never mentioned Brett Kavanaugh in any capacity.” 

After Ketterer decided to run for Congress in Maryland, he thought Julie could be of service to his campaign – however he lost her phone number. After contacting her father, he learned that Julie had “psychological and other problems at the time.” 

Last week we reported that Swetnick’s ex-boyfriend, 

Richard Vinneccy – a registered Democrat, took out a restraining order against her, and says he has evidence that she’s lying. 

“Right after I broke up with her, she was threatening my family, threatening my wife and threatening to do harm to my baby at that time,” Vinneccy said in a telephone interview with POLITICO. “I know a lot about her.” –Politico

“I have a lot of facts, evidence, that what she’s saying is not true at all,” he said. “I would rather speak to my attorney first before saying more.”

Avenatti called the claims “outrageous” and hilariously accused the press of “digging into the past” of a woman levying a claim against Kavanaugh from over 35 years ago. 

And now we can add “group sex enthusiast” to the claims against Swetnick. Read below: 

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It has long been speculated that Mattress Firm, the US mattress retailing giant, was in a solvency crisis, largely as a result of an aggressive expansion strategy in recent years coupled with the spectacular collapse of its parent, Steinhoff International Holdings NV following an accounting scandal in late 2017 and has been struggling to restructure the debt of some subsidiaries with its creditors.

Now, according to Reuters, Mattress Firm, the largest U.S. mattress retailer, is planning to file for bankruptcy as soon as this week as the firm struggles to exit costly store leases and shut some of its 3,000 locations that are losing money.

A bankruptcy filing would make Mattress Firm the latest U.S. retailer struggling due to competition from e-commerce firms such as Amazon.com putting pressure on brick-and-mortar retailers, as well as a decline in demand as the business model transforms. However, a key driver behind any Chapter 11 filing would be the sorry financial state of insolvent Steinhoff,  which acquired Mattress Firm for $3.8 billion in 2016 as part of an aggressive global roll-up which ultimately pushed the company into bankruptcy.

Previously, Reuters reported that both the Houston-headquartered Mattress Firm and Steinhoff had been working with distressed turnaround consultancy AlixPartners, which is often hired just ahead of a bankruptcy filing.

As part of the standard bankruptcy process, once Mattress Firm files for bankruptcy, the process is expected to be completed within a couple of months, and Mattress Firm’s vendors are expected to be repaid in full, with creditors most likely taking over the company. As part of the process, Mattress Firm would shed many of its stores in the process.

Mattress Firm’s South African parent company, Steinhoff International Holdings NV, acquired Mattress Firm for $3.8 billion in 2016. Mattress Firm had acquired HMK Mattress Holdings LLC, the parent company of competitor Sleepy’s, the same year for $780 million and then rebranded the shops. It then set off on an aggressive store expansion, which prompted questions from market participants if the company was cannibalizing its own sales just to represent growth.

Steinhoff is a retail conglomerate that sells furniture, household goods and general merchandise in Europe, Africa and Australia, and it has automotive dealerships in South Africa. In July, creditors agreed to hold debt claims for three years, removing a threat of default according to Reuters.

A bankruptcy filing, while resulting in numerous store closures, would allow Mattress Firm to clean up its real estate portfolio and improve cash flow and profitability, according to Piper Jaffray analysts. In recent Chapter 11 cases, discount footwear retailer Payless ShoeSource closed roughly 700 mall-based stores in bankruptcy last year, while children’s clothing shop Gymboree Corp closed about 300.

The loudest warning sign for Mattress Firm came last year when the retailer lost Tempur Sealy, the maker of popular mattress brand Tempur-Pedic, as a supplier last year, limiting its offerings. Mattress Firm secured a $225 million asset-backed revolving loan last year.

As part of its breakneck expansion which prompted many questions in recent years, Mattress Firm acquired HMK Mattress Holdings, the parent company of competitor Sleepy’s, in 2016 for $780 million and then rebranded the shops. Sleepy’s had over 1,050 stores on the U.S. East Coast and Illinois. 

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