Tag: finance

Authored by Adam Johnson via FAIR.org,

Why is the No. 1 outlet of alleged anti-Trump #resistance completely ignoring his most devastating war?

As FAIR has noted before (1/8/18, 3/20/18), to MSNBC, the carnage and destruction the US and its Gulf Monarchy allies are leveling against the poorest country in the Arab world is simply a non-issue.

On July 2, a year had passed since the cable network’s last segment mentioning US participation in the war on Yemen, which has killed in excess of 15,000 people and resulted in over a million cases of cholera. The US is backing a Saudi-led bombing campaign with intelligence, refueling, political cover, military hardware and, as of March, ground troops. None of this matters at all to what Adweek (4/3/18) calls “the network of the Resistance,” which has since its last mention of the US’s role in the destruction of Yemen found time to run over a dozen segments highlighting war crimes committed by the Syrian and Russian governments in Syria.

By way of contrast, as MSNBC was marking a year without mentioning the US role in Yemen, the PBS NewsHour was running a three-part series on the war, with the second part (7/3/18) headlined, “American-Made Bombs in Yemen Are Killing Civilians, Destroying Infrastructure and Fueling Anger at the US.” The NewsHour’s Jane Ferguson reported:

PBS NewsHour (7/3/18) examining the remains of US-made cluster bombs in Yemen.

“The aerial bombing campaign has not managed to dislodge the rebels, but has hit weddings, hospitals and homes. The US military supports the Saudi coalition with logistics and intelligence. The United States it also sells the Saudis and coalition partners many of the bombs they drop on Yemen.”

MSNBC chat show/Starbucks commercial Morning Joe did run one segment (4/25/18) that vaguely mentioned the war on Yemen, but failed to note the US’s role in it at all, much less that Washington is arming and backing the conflict’s primary aggressor. Instead, they did the perverse inversion––previously mastered by Washington Post’s Jackson Diehl (FAIR.org, 6/27/17)—of not only ignoring the US’s major role in killing thousands, but painting the US as a noble haven for refugees. The schlocky segment, an interview with writer Mohammed Al Samawi, was a shallow mixture of “interfaith” pablum, poverty porn and self-congratulations to the US for taking in refugees (without, of course, acknowledging that they’re seeking refuge from a crisis the US has created).

For a bit more context, in the time period of July 3, 2017, to July 3, 2018, MSNBC dedicated zero segments to the US’s war in Yemen, but 455 segments to Stormy Daniels. This isn’t to suggest the Stormy Daniels matter isn’t newsworthy—presidential corruption is per se important. But one has to wonder if this particular thread of venality is 455 stories more important than Trump aggressively supporting a war that’s killing hundreds of people a month, injuring thousands, and subjecting millions to famine and cholera. Did MSNBC editors, poring over the latest academic foreign policy literature, really come to the conclusion Trump’s war in Yemen isn’t important? Or is MSNBC simply fueled by partisan Russia dot-connecting and stories that allow them to say “porn star” as much as possible?

What seems most likely is MSNBC has found that attacking Russia form the right on matters of foreign policy is the most elegant way to preserve its “progressive” image while still serving traditional centers of power – namely, the Democratic Party establishment, corporate sponsors, and their own revolving door of ex-spook and military contractor-funded talking heads (3/26/18). After all, Obama backed the war on Yemen – though not nearly as aggressively as Trump has – and it’s difficult to make a coherent left-wing, anti-war criticism when the current Republican in office is simply carrying out your guy’s policy, but on steroids.

In any event, it’s not like any Yemenis are going to pull ads, turn down appearances, or phone Comcast higher-ups complaining. So, who cares? To be poor and brown—to say nothing of not serving the immediate partisan interests of the Democratic party—is evidently to not matter much in the eyes of MSNBC producers and on-air talent.

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Stocks are higher and the Loonie is spiking after Bloomberg reports that US Senators introduce a bill to delay auto tariffs.

CAD rallied most….

US Stocks limped higher…

Trump, of course, has veto power… so this could potential set up an interesting showdown.

 

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Ignoring the collapse in auto stocks (GM down most since 2015), the crash in housing data (as David Rosenberg notes, in the past 3 mos.: starts -39% SAAR, permits -23%, new home sales -22% & resales -15%), and the chaos of currencies and trade talk… and given that the major US equity indices are higher (once again ignore the ‘most concentrated strength ever’) must mean “everything is awesome”, right?

Wrong. As former fund manager and FX trader Richard Breslow exclaims today, we are right back in that frustrating mode of traders really not being able to make up their minds… Although you wouldn’t know it talking to them.

Via Bloomberg,

We keep serially rotating back and forth between bullish and bearish. Doesn’t seem to matter the asset class. Everyone is doing it. It’s time to accept that, at the moment, all trading is tactical and opportunistic, not strategic. And we should act accordingly. Saying that one is structurally any which way around is overstating the case. Just wait a few days or weeks and that’s as likely as not to change.

Why does this matter, aside from acknowledging the fact that if there is such a thing, the Global Confusion Index would be one of the few things where the trend higher is unambiguous on the charts?

Because being stubborn is a liability rather than a strength. That isn’t always the case at all. Gutting it out is often something to be admired. For now, being open-minded is at a premium. And we all know that is globally in short supply.

Extrapolation is folly. The news cycle is just too short. You can certainly do a trade based on the current market reaction to what a central bank may or may not do a year or more from now but is no basis for ossifying a world view. And directional changes should be traded as corrections, not reversals. Even if they actually represent long-term changes in direction, let them prove it rather than declare it for them in advance.

So with all of the bold forecasts out there, what do the charts really say? That the markets are a mess and ambiguity is rife. Doesn’t that seem entirely appropriate?

China has eased. The Shanghai Composite is back from the dead. Go out and buy emerging markets, equities, commodities, the Australian dollar. All good opportunities, especially because, for the most part, they have had really nice moves in the opposite direction. Just don’t look at a chart if you are declaring victory and rewriting your year-end forecasts.

The world may have changed but these latest moves aren’t impulsive. And that matters. The retracements have been great money-making opportunities, but haven’t, at least yet, broken any significant technical levels. Stay open-minded.

For this crowd, two of the obvious assets to look at are currencies and equities. Sentiment for the dollar has flipped negative and stocks are deemed bullet-proof. There is nothing in the charts to suggest that the dollar has done anything more than come off recent highs. Both DXY and Bloomberg dollar indices have seen a price within today’s range multiple times over the last week and month. If it is going to crash, no one has told anyone but the CFTC reported new longs that got burned last Friday.

The U.S. stock market is trading well. What the S&P 500 does at 2825 will be an important pivot. That’s just above yesterday’s close, which makes it interesting. It didn’t trade particularly well when it tested the level, but held on nicely.

But it isn’t just stating the obvious to caution that assuming new all-time highs are guaranteed requires overcoming resistance right here. I just don’t see it getting a lot of long-term help from its peers overseas. Unless of course the weak dollar side of the story is wrong.

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After The Bank of Japan sparked a short-term meltdown in global bond markets earlier in the week when it shifted its curve control policy, Nikkei is reporting that Bank of Japan will discuss allocation change in next policy meeting. USDJPY and NKY Futs are down…

As Nikkei reports, BOJ may purchase more ETFs tied to TOPIX and less ETFs tied to Nikkei indices. The review is intended at curbing the excessive impact in pricing of member stocks.

So once again BoJ hits a wall with its market interference. As a reminder, BOJ is a Top 10 holder of over 40% of Japanese stocks!

 

 

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Authored by Tsvetana Paraskova via Oilprice.com,

The higher oil prices and the subsequent higher oil revenues play a part in a significantly improved outlook for the state finances and trade balances of the Arab Gulf countries, but they are not boosting economic growth, a quarterly Reuters poll of 24 economists showed on Tuesday.

The Arab Gulf states have good reason to be happy about their budgets and government accounts this year, as the oil prices have been significantly higher and because they are now boosting their oil production to offset declines in Venezuela and Angola and an anticipated slump in Iran’s oil exports.

The Gulf states – Saudi Arabia and its close allies Kuwait and the United Arab Emirates (UAE), for example – are also some of the few OPEC countries theoretically capable of boosting their crude oil production.

So far this year, the Brent Crude price has averaged $71.60 a barrel, compared to an average of $55 per barrel last year.

Despite the double boon from higher oil prices and rising oil production, the Gulf economies are only modestly growing, and the higher oil revenues will have little impact on that growth, according to the economists polled by Reuters in this quarter’s survey.

The governments in the Gulf would rather use the higher oil income to cut budget deficits than to spur economic growth, economists say. The private sector in the Gulf oil-producing countries is still reeling from austerity measures that the governments introduced to try to keep budgets in check after the oil prices slumped.

“Higher-than-budgeted oil revenue will not result in higher government expenditure, but rather, it will contribute to lowering the fiscal deficit,” Saudi investment bank Jadwa said about Saudi Arabia.

In the previous Reuters quarterly poll, economists were of the same opinion – trade surpluses in the Arab Gulf will increase, but economies will grow only moderately because of the austerity measures.

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Two weeks ago, we presented what Bank of America’s credit strategist Barnaby Martin said was his biggest concern for the remainder of the year: an escalation in trade tensions between the US and Europe.

He argued that an  intensification of US-EU trade tensions could drive fears of “Quantitative Failure”. After all, he said, “the Eurozone is a large, open, economy and the ECB has – for political reasons – recently announced the end of QE.”  To underscore his case, Martin shows that uncertainty over global trade policy has now risen to levels last seen in late 1994, around the time of NAFTA’s inception. “Therefore, much concern regarding trade is already in markets.”

But why is BofA so worried about global trade when markets seem to persistently put concerns about it on the backburner? Just today, Bloomberg carried a piece that the “Stock-Market Boom Shows Trade War Becoming Background Noise.” The reason, as BofA explains, is that trade tensions put at risk one of the big secular themes of the last few years – namely that of global synchronised growth.

Now, as is well-known, 2017 was the first time since 2006 that all OECD countries posted positive economic growth rates: this is the reason cited by many why market volatility (and excitement) dropped to record low levels as “economic certainty effectively bred market certainty.”  The distribution of annual GDP changes across OECD countries since 2004 is shown below.

The problem in 2018, is that while global growth remains strong this year – at just under 4% – there are growing signs that the recovery has become less synchronised, “a concern echoed by the IMF over the weekend at the G20 Finance Ministers meeting. As a consequence, markets have become more fragile in 2018”, according to Martin.

So what are the signs of less synchronized growth?

One place is to look is the extent to which US equities have decoupled from EM equities since May this year.

Trade tensions have depressed global growth proxies, such as Emerging Markets. Yet, the US economy continues to be buoyed by Trump’s significant fiscal stimulus (and note the near record EPS surprise stats from the current US earnings season)

It’s the same in Developed markets: in Europe, after the impressive 0.7% quarterly GDP print at the end of last year, growth slipped to 0.4% in Q1 of 2018. Logically, given Germany’s export focus, the Emerging Market weakness – in particular China – explains some of the loss of Europe’s economic momentum lately.

As we showed it recently, and as BofA does today, the next chart shows the extent to which financial conditions in China have tightened.

Looking at Total Social Financing as a percentage of China M2, one can see that the measure has fallen to a record low.

But the biggest pain remains in EM, where as a result of the soaring dollar, largely a byproduct of US economic power vis-à-vis the rest of the world, and trade tensions rising, the broader EM complex has suffered. Using a chart we first presented in May, Martin then shows the performance of a number of EM currencies versus the US Dollar.

We compare two periods: the 2013 Taper Tantrum and this year’s trade spat. As can be seen, it’s not just those counties with obvious current account imbalances (Turkey, for instance) that have seen worse currency performance this year compared to the Taper Tantrum. Plenty of EM currencies have depreciated more vs. the USD in 2018 than in 2013.

Which brings us to today, and why market are primed for a rally if the trade rhetoric begins to sound more promising, as it would help rekindle the narrative of global synchronised growth. Alas, today’s meeting between Turmp and Juncker will hardly be the starting shot (and not just because Europe is a bureaucratic labyrinth in which it will take months if not years to reach an agreement between the member nations).

But the main reason why nothing will happen – at least not until the market suffers far greater punishment – is that as BofA chief economist Ethan Harris warns, “trade wars rarely end before there are clear economic casualties – and on this front there have been few thus far.”

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After a mediocre, tailing 2Y auction, which yesterday priced with a small tail, the just concluded sale of an upsized $36 billion in 5Y paper was nothing short of stellar.

Pricing at 2.815%, above last month’s 2.719% and if below May’s 2.864%, the auction stopped a whopping 1 basis point through the When Issued, the biggest since December 2016. The Bid to Cover likewise was surprisingly strong, with 2.61 in bids for every bond tendered.

The internals, however were most impressive, with a whopping 67.2% in Indirects, higher than both last month’s (62%) and the 6 month average (60.8%), and the highest going back all the way to September 2017. Directs dipped modestly to 8.7%, below the 10.7% 6MMA, leaving Dealers holding 24.1% of the auction, the lowest since last November.

Overall, a stellar auction in light of today’s equity market rebound, one which sets us up quite well for tomorrow’s final 7Y bond sale.

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A suspicious package labeled “Anne Thrax” was left at the South Los Angeles office of Rep. Maxine Waters (D-CA) on Tuesday, according to the Los Angeles Fire Department. 

Portions of her two-story office building were evacuated as a hazmat crew investigated, and employees were allowed back inside after the package was reported safe. The LAPD Major Crimes Division has launched an investigation, according to spokesman Mike Lopez. 

“There was no evidence of any dangerous substance at all,” he said. “They’re probably going to investigate to see where this item came from.”

Authorities were called to the Democratic congresswoman’s office at 10124 S. Broadway St. shortly after 2:30 p.m. There were no injuries reported. One person came into contact with the package but did not have any medical complaints, according to the Los Angeles Fire Department. –LATimes

1of2 #HazardousMaterials; INC#0993; 2:55PM; 10124 S Broadway St; https://t.co/wsNXSXdNh5; Broadway-Manchester; LAPD on scene and requested a hazardous materials response by LAFD for suspicious package (reportedly labeled “anthrax”). There are no reports of any patients requiring

— LAFD (@LAFD) July 24, 2018

Late last month Waters canceled events in Texas and Alabama after she claims a “very serious threat” was made against her. 

“There was one very serious death threat made against me on Monday from an individual in Texas which is why my planned speaking engagements in Texas and Alabama were canceled this weekend,” Waters said in the statement.

That said, Waters also told a Sunday congregation at the First AME Church in Los Angeles that God sent her to fight Donald Trump – so we assume that even if the Anthrax was real and she set foot in her own office, she would be protected by divine powers so she might continue her crusade against the sitting president. 

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Authored by Peyton Dillberg via Campus Reform,

With the left’s full embrace of Alexandria Ocasio-Cortez, the Democratic Socialists of America (DSA) is in the mainstream media’s spotlight. 

With more than 40,000 card carrying members, DSA is a growing leftist force in not only our political system, but in our systems of higher education.

So why is the left, especially in our universities, embracing an ideology that has resulted in the deaths of over a hundred million people? Here are three reasons why socialism is making a comeback on college campuses:

1. It is intellectually appealing

The intellectual appeal of socialism – and postmodern ideology in general – is incredibly strong. There is also no better place to foster that appeal than a university, and professors are the perfect conduits for postmodern thought. 

So how do they create such intellectual appeal? It’s actually quite complex, as the indoctrination occurs throughout a student’s career. Professors, most of whom are already well-versed in leftist ideology, begin by setting up parameters for their students. Within these parameters lies an acceptable range of ideas—a relatively easy feat, as students tend to be rather malleable with regard to their own ideology.

Knowing that most students are not politically active as high school students, professors can frame their lectures however they wish. In a course traditionally filled with new students, like a mandatory first year class that aims to acclimate new students to higher education, or an introductory American politics class, the professor can frame lectures along leftist talking points. The goal is to plant those talking points, allowing students to fall under the illusion that they are developing their own leftist ideas. This is done with a fair amount of confidence, considering that ideological diversity is virtually nonexistent at many universities, and most students may be too focused on their own transition into higher education to conduct independent research into the topic at hand.

As students are spoon-fed leftist talking points in class, reaffirmed by the overrepresentation of the left in social media, they begin to develop their own ideology under the framework set by their professors and shallow political awareness through social media. 

Students who pursue degrees in the social sciences and other liberal arts are then further “developed” in their ideology. As a student progresses through majors in political science, sociology, or other social sciences, the indoctrination gets progressively more aggressive. Students who have already had the framework provided by previous professors (and other influences) are forced to think within those parameters, which continue to shrink over time. A professor may ask students to write papers on what had previously been nothing more than a political talking point, for instance, in order to forge a more aware leftist.

So where is it intellectually appealing? It’s in that “developmental” stage where students begin to evolve from talking points. They may be asked to develop their ideas of welfare under the de facto parameters of Keynesian economics in that it can do no wrong, or they may be taught that mandating all employers to provide free daycare would help achieve equity among men and women in the workplace. 

The same could be done for any other leftist issue, and is rigorously repeated throughout a student’s pursuit of a degree. What happens then is that students become tantalized with using the government as a mean to promulgate policy, and when you have an authoritative government to enforce things like universal day care, the sky is the limit when determining other policies like nationalized healthcare, language control, and the pursuit of social justice.

2. There is a crisis of meaning

The decline of religion has allowed for the rise of secularism, and it has been problematic. It is an issue because it has allowed for the substitution of the community for the state, as the state is often seen as “community” by the left. The Sunday church crowds and the local homeowners association gatherings seem to have faded away to a strangely introverted society. The results of this are indicative in a 25 percent increase in suicides since 1999. The devaluation of life itself is eminent in the rise of assisted suicide in Europe. People are starved for meaning, and they are attempting to find that meaning in politics—and even more so in the Democratic Socialist movement.

Socialism can be intoxicating to those starving for meaning. Its promise of both physical and metaphysical reward from the efforts of the collective can entice those not careful enough to realize the morbid realities it creates.

However, the negatives are swept under the rug, as the left’s idea of socialism involves the pursuit of virtue. Righteous indignation is a powerful drug, and the socialists are heavy users. This is especially true of the younger students on campus. People are trying to discover their role in a world where people are refusing to find meaning in God, but the desire for virtue is still very much alive. The socialists have provided the liquor, and they are playing with intoxication. Students see that the socialists fight for the supposed widespread and devastating oppression of minorities, women, LGBTQ individuals, and those who don’t practice Judeo-Christian faiths. They offer a spot for anyone seeking virtue (within the predetermined parameters) in order to destroy their straw man.

3. They haven’t seen socialism in action

It’s easy to disregard and revise history as long as it is convenient to do so, such as ignoring the fact that more than 100 million people (that we know of) have been killed by the very ideas that are pushed by socialists every day. They will revise history by saying “true socialism has never been tried,” but even a modern day example in Venezuela, which is by far one of the best (and one of the only modern) examples of the effects of true socialism, is discounted thanks to the “no true Scotsman” fallacy.

*  *  *

Our schools are failing us. Our communities are disappearing. Ideologues knee deep in their own garbage are unable to understand the true evil that is socialism. The far left is a much greater threat to our nation than any neo-Nazi group will ever be, and our universities are the gateways to the left.

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A Turkish court has ruled that F35 stealth jets…”poor health” is the reason for the transfer of an American pastor who has been held for two years on “terrorism” and “espionage” charges. 

It appears yesterday’s controversial Congressional vote to block sale of Lockheed Martin’s advanced F-35 stealth fighter to Turkey may already be having an effect as less than 12 hours after the House and Senate adopted the legislation, American Pastor Andrew Brunson has been released from a Turkish prison and placed into house arrest.

US pastor Andrew Brunson has left jail and is on his way to his way to his home in the city of Izmir, according to Turkish TV station A Haber. He has spent almost two years behind bars on espionage and terror charges. Will remain under house arrest. pic.twitter.com/dFxjuuat6k

— Laura Pitel (@laurapitel) July 25, 2018

Brunson’s family is “elated” according to media statements. His wife reportedly waited for his release from a prison in the western part of the country.

He will be confined to his residence in Turkey where he can have interaction with his family and move freely within the confines; however, he will continue to proceed through his trial in the Turkish legal system. 

Pastor Brunson, a 50-year-old evangelical pastor from Black Mountain, North Carolina detained in 2016, faces charges including espionage and aiding terrorist groups after being accused of cooperating with “Kurdish terrorists” and colluding with the Gulenist Islamic movement; he faces up to 35 years in prison if found guilty. He has now been in Turkish custody for nearly two years.

Turkey’s Hurriyet Daily summarized the legal declaration of Brunson’s house arrest:

The Second High Penal Court in the western province of İzmir had rejected Brunson’s plea for release on July 18, deciding to continue listening to the testimonies of witnesses in the next hearing scheduled for Oct. 12.

Following an objection from Brunson’s attorney İsmail Cem Halavurt, however, the same court ruled on July 25 to move Brunson from prison to house arrest citing the “health excuse” that was stressed in the plea.

The court also banned Brunson from leaving Turkey and imposed a judicial control decision.

Previously, President Trump has personally called for Brunson’s release in multiple public statements, saying as recently as a week ago on twitter while directly addressing the Turkish president: “A total disgrace that Turkey will not release a respected U.S. Pastor, Andrew Brunson, from prison. He has been held hostage far too long. Erdogan should do something to free this wonderful Christian husband & father. He has done nothing wrong, and his family needs him.”

And in April Trump tweeted about the pastor: “They call him a Spy, but I am more a Spy than he is. Hopefully he will be allowed to come home to his beautiful family where he belongs.”

Pastor Andrew Brunson, a fine gentleman and Christian leader in the United States, is on trial and being persecuted in Turkey for no reason. They call him a Spy, but I am more a Spy than he is. Hopefully he will be allowed to come home to his beautiful family where he belongs!

— Donald J. Trump (@realDonaldTrump) April 18, 2018

American diplomats have also previously warned the arrest is part of the Turkish government’s policy of “hostage diplomacy” and further warned the issue could trigger “unprecedented sanctions” — something Congress followed through on in its passage of the 2019 the National Defense Authorization Act (NDAA) which locks transfer of the advanced stealth fighter, each aircraft costing at least $100 million.

The Pentagon’s budget blueprint for the upcoming fiscal year will now go the president’s desk with language in it that calls for the immediate release of Brunson. The bill also mentions immediate release of any other “U.S. citizens wrongfully or unlawfully detained in Turkey” and calls for improved human rights under the increasingly authoritarian Turkish state and – ironically – NATO ally.

Pastor Brunson’s fate has lately become bound up with a broader tense geopolitical standoff between the US, Turkey, and Russia connected to Ankara’s pursuing a contract for Russia’s advanced S-400 anti-missile defense system, said to be worth $2.5 billion. State Department officials have lately to warned of sanctions over the defense shield’s installation, rare to the point of being unheard of when it comes to NATO allies, specifically because of fears that Russia would get simultaneously gain access to the extremely advanced Joint Strike Fighter stealth aircraft, enabling Moscow to detect and exploit its vulnerabilities. 

U.S. Secretary of State Mike Pompeo welcomed the ruling on Wednesday, but added that “it is not enough”.

Interestingly, though the court cited “poor health” as its reason to grant transfer to house arrest, it appears that Turkey is trying to soften what’s now clearly US Congress’ strong-fisted resolve to follow through on Washington’s threats on the matter. 

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