Month: February 2022

Authored by Jim Quinn via The Burning Platform blog,

In Part One & Part Two of this article I laid out how those in power have used the power of propaganda and the psychology of fear to weaponize a flu to further their Great Reset agenda, while ensuring an economic and financial collapse through the issuance of trillions in unpayable bad debt. In Part Three of this article, I will examine how the civic decay in our society, created by the ruling class, will coalesce into a bloody firestorm of death and destruction during the remaining years of this Fourth Turning.

“One does not establish a dictatorship in order to safeguard a revolution; one makes the revolution in order to establish the dictatorship.” ― George Orwell, 1984

“The masses never revolt of their own accord, and they never revolt merely because they are oppressed. Indeed, so long as they are not permitted to have standards of comparison, they never even become aware that they are oppressed.” ― George Orwell, 1984

There had been a theory discussed a few years ago regarding the nature of Fourth Turnings alternating between externally focused and internally focused. It is more about the key drivers, as all Fourth Turnings are impacted by domestic and foreign influences. Even though the sample size is small, this Fourth Turning appears to be following the alternating pattern. The American Revolution was driven by conflict with a foreign power (Great Britain), with another foreign power (France) tipping the scales in favor of the patriots. The Civil War was almost entirely a domestic internal conflict, with Great Britain not fully supporting the Confederacy, and tipping the scales in favor of the North. The Great Depression was created by global central bank machinations, with World War II almost entirely fought on foreign soil, leaving the U.S. as the unchallenged leader of the free world after 1945.

It is evident to me this Fourth Turning is being propelled domestically, as the unbridgeable rifts between political parties, states, cities, races, and genders are being stoked and amplified by globalist billionaire elitists. The accelerating level off civic decay and our rapid descent into chaotic conflict has not occurred spontaneously but has been engineered as a crucial element in the Great Reset scheme to “reimagine” and “reset” the world.

Klaus Schwab, the front man for the Davos elite, and sociopath of the first order, sees the deaths of millions from a purposely weaponized virus as a “window of opportunity”. When he refers to “our world” he isn’t including you in his world. You will own nothing and be happy. He and his billionaire death cult will own everything and keep you enslaved in debt, under technological surveillance, with the threat of violent retribution if you do not bend the knee.

Anyone who has observed the level of violence, murder, lawlessness, and mayhem sweeping the country over the last two years who thinks our country isn’t descending into a chaotic hellscape, are either willfully ignorant or benefiting financially from the orchestrated turmoil. The BLM looting, rioting, burning and murdering escapade, which went on for over a year, and strangely subsided once Trump was disposed of, was not a kinetic reaction to the death of a black drug addled felon being restrained by a white cop, but a well-funded orchestration designed to create havoc in cities across the nation, as part of the plan to destabilize our society.

These staged “protests” were funded by Soros and his ilk to accomplish multiple goals: eliminating Trump; destroying small businesses; weaponizing uneducated blacks; crippling law and order by scapegoating police; and generating outrage by law abiding white people across the country.

You know BLM is nothing but a front organization for Soros, because they have no interest in protesting or stopping the mass slaughter of black teens in the urban ghettos of Philly, Chicago and all the other Democrat run hell holes across the land. Race baiters on MSNBC like Sharpton & Joy Reid are nothing but grifters stoking the flames of a fake racism narrative to please the Soros crowd.

It is an unequivocal fact George Soros and his cohorts have funded the election of district attorneys, mayors, governors, and congress people with massive influxes of money, guaranteed to put into place Marxist Manchurian candidates who will do the bidding of Soros and the Great Reset World Economic Forum elite.

There is no other logical explanation for why Soros would spend tens of millions to get DAs elected in Chicago, Philadelphia, Los Angeles, San Francisco, New York, Milwaukee, St. Louis, and numerous other Democrat controlled cities, who have absolutely no interest in prosecuting violent felons or even keeping them confined. The result has been a massive surge in murder, violent assaults, car jackings, robberies, and wholesale death and destruction. The blood is on Soros’ hands.

Marxist Governors and mayors like Newsom, Whitmer, DeBlasio, and Lightfoot, along with these Marxist DAs, have been put in place to conduct a controlled demolition of our civilized society in order to build back better under the principles of totalitarianism, under the control of billionaire globalist psychopaths hell-bent on owning everything and keeping a boot on the face of everyone else.

The co-conspirators in the media, fully underwritten by Soros and his accomplices, have undertaken to promote fake racist attacks by Nigerian MAGA terrorists and NASCAR noose wielding white supremacists, while completely ignoring the slaughter by vehicle of 6 white Christmas parade participants and injuring of 62 by a provably racist black felon, let out of jail by a Soros DA. The narrative to maximize the chances of a race war is the goal of Soros and his media mouthpieces.

How can anyone with critical thinking skills possibly believe what Biden and his handlers are orchestrating on our southern border isn’t designed to further tear our country down, making a mockery of the legal immigration process and a fair and honest election system? In the year he has been in office Biden has willfully allowed two million illegal immigrants (mostly young men) from countries all over the world to pour over our southern border with no effort to stem the flow. This is clearly a well-planned, Soros funded initiative to illegally remake the demographics of the country to maximize Democrat control in key swing states and solidify their hold on urban enclaves.

Your government is using your tax dollars to secretly shuttle these illegals on airplanes in the middle of the night to small airports in communities all across the country and then letting them disperse into the general population. They are landing in Westchester NY, Allentown PA, and dozens of other small cities. Others are given bus tickets and told to go anywhere they choose. Meanwhile, NYC, to be followed by many other Democrat run municipalities, are passing laws to allow illegals to vote in elections. This blatant abuse of power goes unchecked.

Any semblance of a civilized society based on agreed upon community standards, human rights, minimal but rational laws, inhabited by morally endowed citizenry, and led by ethical fair-minded leaders, has been systematically and methodically destroyed by a ruling oligarchy driven to maximize their own control, wealth, and power. They see you as nothing more than cattle to be milked, controlled, herded, and slaughtered for profit when they decide. Freedom, liberty, and self-responsibility are outmoded concepts in a world run by billionaire oligarchs. Do you get it yet?

We know our public-school government indoctrination centers have dumbed down generations of young people, teaching them how to regurgitate government approved pablum, but not how to think critically, question authority, or develop an inherent curiosity about their surroundings. They don’t want concerned intelligent citizens understanding the true nature of their government, financial system, and who really controls the levers of this world. Carlin summed it up nicely in his epic rant about the real owners of this country and the truth about the American Dream.

They don’t want a population of citizens capable of critical thinking. They don’t want well-informed, well-educated people capable of critical thinking. They’re not interested in that. That doesn’t help them. That’s against their interests.

That’s right. They don’t want people who are smart enough to sit around a kitchen table and think about how badly they’re getting fucked by a system that threw them overboard 30 fucking years ago. They don’t want that!

You know what they want? They want obedient workers. Obedient workers, people who are just smart enough to run the machines and do the paperwork. And just dumb enough to passively accept all these increasingly shitty jobs with the lower pay, the longer hours, the reduced benefits, the end of overtime and vanishing pension that disappears the minute you go to collect it, and now they’re coming for your Social Security money. They want your retirement money. They want it back so they can give it to their criminal friends on Wall Street—and you know something? They’ll get it. They’ll get it all from you sooner or later ‘cause they own this fucking place! It’s a big club, and you ain’t in it! You, and I, are not in the big club.

But dumbing down the populace wasn’t enough for these psychopaths in suits. Over the last several years, the “woke” agenda has been drilled into the pliable brains of students from kindergarten through college by far-left teachers, professors, and administrators doing the bidding of Soros, the CCP, and others whose goal is to subvert and destroy our way of life. Our universities have been infiltrated by useful idiot communists, bent on creating a new generation of youth educated to hate America, embrace victimhood, believe the tripe about institutional racism, and think socialism is a viable economic system.

A large percentage of those under 30 years old believe their feelings and opinions, supplied by the fake news propaganda spewing corporate media outlets, and reinforced by left wing social media corporations, are as legitimate as provable facts based on reality. They can and have ignored the facts, but that doesn’t mean the facts cease to exist.

“Facts do not cease to exist because they are ignored.” – Aldous Huxley

There is nothing worse in this “woke” agenda than the wholesale teaching of degeneracy to youngsters, trying to portray abnormal behavior, perversion, and deviancy as normal and a reasonable choice for them to make. The absurdity of men pretending to be women in order to win sporting events has feminists twisting in the wind. What kind of school administration and teachers would allow drag queens to parade their deviant lifestyle in front of kindergartners? If you teach deviancy and degenerate behavior, you beget a society bereft of morality, values, community standards, and behavior befitting a civilized society.

People who choose abnormality as their way of life are perfectly free to do so, as long as their choices do not infringe upon how the vast majority of normal people live their day to day lives. But that is not what left wing politicians, woke universities, Hollywood deviants, and leftist media have been jamming down our throats for years. They glorify abnormality and degenerate behavior. They are essentially promoting mental illness. And now every university and corporation have to hire diversity & inclusion departments and make white employees sit through “training” about how they are privileged and should be ashamed of being white.

Through the use of the public education system, media propaganda designed to manipulate the minds of the masses, corrupt feckless politicians, and a society controlled by corporate technocrats, they have produced millions of mentally ill people who only appear normal because we have allowed our society to descend into an anything goes culture of decadent ignorance. We have become a profoundly unhealthy society, driven by emotion, technological distraction, and a belief your ignorance is equal to my knowledge.

If Aldous Huxley thought our society was profoundly abnormal in the 1950s, he would need some extra LSD after witnessing the level of mental illness being exhibited by tens of millions, particularly since the election of Donald Trump in 2016. Trump derangement syndrome quickly mutated into the madness of the Covidian Cult and their glorious leader Saint Fauci of Wuhan.

“The really hopeless victims of mental illness are to be found among those who appear to be most normal. “Many of them are normal because they are so well adjusted to our mode of existence, because their human voice has been si­lenced so early in their lives, that they do not even struggle or suffer or develop symptoms as the neurotic does.” They are normal not in what may be called the absolute sense of the word; they are normal only in relation to a profoundly abnormal society. Their per­fect adjustment to that abnormal society is a measure of their mental sickness.

These millions of abnormally normal people, living without fuss in a society to which, if they were fully human beings, they ought not to be adjusted, still cherish “the illusion of indi­viduality,” but in fact they have been to a great extent deindividualized. Their conformity is developing into something like uniformity. But “uniformity and free­dom are incompatible. Uniformity and mental health are incompatible too. Man is not made to be an automaton, and if he becomes one, the basis for mental health is destroyed.” – Aldous Huxley

The piece de resistance in the quest to maximize the amplitude of civic decay during this Fourth Turning has been accomplished through this pandemic of the willfully ignorant, incited and galvanized by the mendacious media, totalitarian paid-off politicians, and health “experts” in the pockets of Big Pharma, as the biggest propaganda marketing campaign in human history was launched to instill fear in the masses over a relatively non-lethal flu which could be combated with cheap existing therapies and vitamins.

The campaign of fear was used to test how far the masses would allow themselves to be herded, corralled, and sheered of their liberties, freedoms, and Constitutional rights. The ruling elite were ecstatic to learn they attained near absolute compliance and obedience to their ridiculous lockdowns, un-scientific mask mandates, ludicrous social distancing guidelines, and now their preposterous vaccine passport requirements.

The mass formation psychosis discussed in Part One of this article absolutely meets the criteria laid out above by Huxley. The millions of hopeless victims of mental illness, created by their environment, teaching and conditioning, were the perfect dupes for this fabricated covid mass hysteria event. They cling to the belief they are making individual decisions based on facts, when in reality they only have the illusion of individuality, and have unthinkingly followed the herd, getting their experimental jabs, at the behest of those in power.

In reality, they have voluntarily become deindividualized by joining the Covidian Cult of mental illness. They have willingly sacrificed their freedom for uniformity and obedience to the demands of authoritarians and self-proclaimed health “experts” who are compensated by Soros, Gates, Big Pharma, and the usual Davos suspects. Their previous mild level of mental illness has metastasized into a full-blown cancerous tumor of mental disease with this covid mass formation psychosis. The only treatment for this cancer is freedom, truth, factual data, and resistance.

This entire scamdemic has been nothing but a psychological operation by the Great Reset architects to permanently tear the last vestiges of our society down, create havoc and hatred, instill fear among the masses, scrap what remains of the Constitution, rule by dictate, and reap the riches of their psychopathic venture. We’ve reached peak civic decay and it has all been aided, abetted, and funded in an organized way by Soros and his fellow billionaire globalists who want to permanently reset the world, so they call the shots and reap the spoils.

The rollout of these dangerous, untested, gene therapies, disguised as vaccines, which do not prevent you from catching the virus, spreading the virus, being hospitalized by the virus, or dying from the virus, is the final straw and will determine whether we surrender to tyranny or make a last stand.

The vaccine mandates being rammed down our throats by our illegitimate president poopy pants, totalitarian governors and mayors, universities, and woke corporations are a bridge too far for hundreds of millions around the world. The mentally ill sheep have timidly lined up for the three jabs (soon to be four) even though covid “cases” are 350% higher than they were before the “vaccines”. Connecting the dots is hard for the mentally ill, who don’t want to admit they were lied to and misled.

Millions are being injured or killed by the vaccines. And no one knows the long-term health effects, but I can assure you they won’t be good. So, our betters, ruling through intimidation, cancel culture, and illegal proclamations, are mandating citizens to be injected with this toxic concoction or be shunned from society, fired from their jobs, and reviled as filthy disease spreaders. A mandate for something that doesn’t work is the pinnacle of absurdity. But here we are.

The push back and resistance from a minority of freedom loving, like minded individuals around the world seems to be having an impact. Protests across the world against vaccine mandates have been steadily growing over the last few months. The defiance in the face of these mandates and willingness to confront the police thugs enforcing the dictates of their totalitarian masters has begun to spread like wildfire across the globe.

The U.K., Ireland, Denmark, and several other European countries have been forced into scrapping their mandates and restrictions by their outraged and vocal constituents. Large peaceful protests are beginning to work, inspiring critical thinking citizens of other countries to follow their lead. Brushfires of freedom are being lit. Hopefully, the citizens of Australia, New Zealand, Germany, Austria, France and especially the United States are inspired to resist vaccine mandates too.

In the U.S., a Defeat the Mandates rally of tens of thousands was held in the heart of Mordor on the Potomac at the Lincoln Memorial last week with speakers including Dr. Robert Malone, Dr. Peter McCullough, Dr. Pierre Kory, Robert F. Kennedy Jr., and many other purveyors of vaccine truth. The covid propagandists in the mainstream media pretended it didn’t happen, because that’s how censorship works in today’s world.

Of course, the old Fahrenheit 451 method of book burning is still alive and well, with the enlightened left attempting to de-platform Joe Rogan for daring to interview two of the highly credentialed doctors listed above. The Fahrenheit 451 squads at Twitter, Facebook, and Google have been censoring, deleting, canceling, and technologically burning up the factual writings of anyone who dares question the official approved government narrative about covid, Wuhan, ivermectin, myocarditis, vaccine effectiveness, vaccine safety, PCR test reliability, Saint Fauci, the uselessness of masks, torture of school children, and the true reasons for vaccine mandates. Speaking truth to power is a crime when the criminals control the levers of power.

Many people have been cowering in fear, afraid to speak out against vaccine mandates because they could be fired, cancelled, or shunned by friends and family. But some prominent and not so prominent individuals have stood up and refused to be cancelled or bullied into an unwanted and unnecessary medical procedure, which only benefits Big Pharma and the leeches in government, healthcare industry and media attached to these peddlers of fake cures for the billions in handouts for toeing the line.

The most inspiring example of push back is the current blockade and occupation of Ottawa by 50,000 truckers from all over the continent. Their arrival prompted their cowardly prime minister to go into hiding in a secret location where he can tweet and spend time re-reading the Communist Manifesto and how Castro succeeded in keeping Cuba’s economy at a 1950s level for sixty years.

Trudeau has done wonders for the meme business, with Coward-19 trending on Twitter. People in the U.S. are thinking, if the normally docile Canadians can rise up against tyranny, why can’t we. Talk of a trucker convoy in the U.S. to surround Washington DC has begun to bubble.

Still, the battle is far from won. The government-controlled media in Canada practices censorship by pretending the trucker revolt isn’t happening. If you don’t report it on your daily propaganda newscasts or write about it in your daily bird cage lining newspapers, then it’s not happening. But this is where social media and independent bloggers can still have an impact.

When citizens of the world see what is actually happening, as reported by other citizens, the credibility of the legacy media falls further, trust in the government sinks, resistance builds, and eventually the existing corrupt social order falls and is swept away in a maelstrom of chaotic transformation. This is not the end, but the beginning of the end.

Those in power will not relinquish power without a fight. They are using their worn-out predictable playbook of deeming all protestors as white supremacists, neo-nazis, and domestic terrorists. Government infiltrators will attempt to stir up violence, just as they did on January 6 at the Capitol. The media will produce fake news about violence and racism. They have the full force of the police state and media to suppress the Ottawa protest and all future protests.

We cannot go meekly into the night, satisfied with a few days of publicity and proud to have made a brief stand against the forces of darkness. This is a Fourth Turning, where the action builds to a crescendo and the climax is bathed in blood. The mantle of power must be seized, as the forces opposing truth, freedom and liberty are demonic in nature and capable of the most horrific atrocities in their voracious appetite for power, control, and wealth. The choice is servitude or freedom, as Calvin Coolidge accurately stated a century ago.

Our civic virtue as a nation has been lost and must be regained. Every Fourth Turning channels the fury of generations in a desperate struggle between good and evil, to reach a climactic finale. As 2022 has begun, we are clearly experiencing a winter of discontent, with anger, wrath and hatred driving opposing forces towards conflict. The divisions within our country are deep and seemingly intractable, the way Soros and the Davos elite planned. But we are the many and they are few.

They believe they are safe and secure behind their golden gates and unscalable walls, with armed guards securing their perimeter. Many monarchs have felt the same level of safety, to find out they were dreadfully wrong. When a large enough army of patriots assemble and begin to fight back, the sheep will begin to follow, and the end will be nigh for the overlords of evil. We are about to enter the most challenging and dangerous chapter of this Fourth Turning. Summon your courage and prepare to fight.

“If civic virtue is so frequently lost, it must be just as frequently regained. This is what happens in a Fourth Turning. While a Crisis mood renders societies newly desperate, it also renders them newly capable, which is why a saecular winter is to be welcomed as much as feared. As today’s Americans look ahead, the challenge is to marshal the coming season’s new public energies to achieve positive, not destructive ends. The better we ready ourselves collectively the more Iikely we will be to not just survive the Crisis but to apply its fury for good and humane purposes.” – Strauss & Howe – The Fourth Turning

In Part Four of this article, I will try to envision what impact the current global disorder will have on the remainder of this Fourth Turning. Even though it is primarily being driven by domestic conflict, there is a high likelihood of foreign conflict, as China and Russia compete with the declining American superpower on the world stage. And politicians have always tried to distract from their domestic failures with a foreign conflict designed to garner support from the masses.

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Heading into today’s post-market earnings juggernaut, which includes EA, SBUX, PYPL, GM, and others, the one company investors were most focused on was Google, pardon Alphabet, the third largest US company by market cap  As Bloomberg writes in its preview, investors will be laser focused on progress in Alphabet’s Google Cloud segment. The internet company’s cloud-computing unit is the No. 3 player in the U.S., behind Amazon Web Services and Microsoft’s Azure.

But the far bigger question is whether Alphabet would continue the trend of earnings beats set last week with Microsoft and ahead of the coming earnings from Amazon and Facebook.

The answer, at least judging by the stock’s kneejerk reaction which is 3.5% higher, was a solid yes. Here are the results:

• EPS $30.69 vs. $22.30 y/y, beating estimates of $27.35
• Revenue $75.33 billion, +32% y/y, beating the estimate of $71.89 billion
• Revenue ex-TAC $61.90 billion, +33% y/y, beating the estimate of $59.37 billion
  • Google Services revenue $69.40 billion, +31% y/y, beating estimates of $66.64 billion
  • Google Cloud revenue $5.54 billion, +45% y/y, beating estimates of $5.42 billion
  • Other Bets revenue $181 million, -7.7% y/y, beating estimates of $209.6 million
• Operating income $21.89 billion, +40% y/y, beating estimates of $21.16 billion
  • Google Services operating income $25.99 billion, +36% y/y, beating the estimate of $24.26 billion
  • Google Cloud operating loss $890 million, -28% y/y, estimate loss $820.9 million
  • Other Bets operating loss $1.45 billion, +28% y/y, beating the estimate loss $1.32 billion
• Operating margin 29% vs. 28% y/y, beating the estimate 28.8%
• Capital expenditure $6.38 billion, below the estimate $7.42 billion

And visually:

Commenting on the quarter, CEO Sundar Pichai said that “our deep investment in AI technologies continues to drive extraordinary and helpful experiences for people and businesses, across our most important products. Q4 saw ongoing strong growth in our advertising business, which helped millions of businesses thrive and find new customers, a quarterly sales record for our Pixel phones despite supply constraints, and our Cloud business continuing to grow strongly.”

CFO Ruth Porat also chimed in, saying that “our fourth quarter revenues of $75 billion, up 32% year over year, reflected broad-based strength in advertiser spend and strong consumer online activity, as well as substantial ongoing revenue growth from Google Cloud. Our investments have helped us drive this growth by delivering the services that people, our partners and businesses need, and we continue to invest in long-term opportunities.”

The company’s gains were driven by the company’s advertising business, which has benefited from continued growth in commerce, especially during the lockdown.  According to a recent Morgan Stanley survey, Google’s e-commerce strategy has gained more traction, finding that Amazon customers were increasingly starting their shopping searches on Google. And indeed, with the $43 billion in revenue the Search business generated last quarter — trouncing the very strong $32 billion from a year earlier — there must be some truth to the idea that the shopping strategy is paying off.

As Bloomberg notes, a somewhat unexpected bright spot in the report is Google’s ad tech business, called “Google Network.” It connects ad buyers to websites, and its stronger-than-expected $9.3 billion in revenue shows that demand remains strong to advertise across the web.

Google also recently made a change so that the highest bid wins ad auctions rather than the second-highest bid. It said at the time this might mean more money to publishers.

Unlike last quarter when investors were disappointed by Cloud, this time the Cloud narrowly beat Wall Street’s estimates, in another sign that the division’s growth is robust and predictable. Cloud generated revenue of $5.54 billion, up +45% y/y and beating estimates of $5.42 billion; This however translated into a cloud operating loss of $890 million, worse than the consensus estimate of $820.9 million. The lack of profit shows that while Cloud is growing, it is still not accelerating fast enough to overtake Amazon or Microsoft anytime soon.

The one potential weakness was YouTube, where ad revenue fell short of analyst estimates. The video site’s ad business is thought of as more costly to maintain and difficult to grow than the company’s Search-ads business.

But the kicker for investors was that Alphabet approved a 20-for-one stock split, and as part of the stock split, the company will give $0.001 for each share of the company’s Class A stock, Class B stock and Class C stock. 

Alphabet today announced that the Board of Directors had approved and declared a 20-for-one stock split (the “Stock Split”) in the form of a one-time special stock dividend on each share of the Company’s Class A, Class B, and Class C stock. The Stock Split is subject to stockholder approval of an amendment to the Company’s Amended and Restated Certificate of Incorporation to increase the number of authorized shares of Class A, Class B, and Class C stock to accommodate the Stock Split.

In kneejerk reaction, GOOGL stock is surging some 7% after hours, and is pushing not just its immediate advertising peers Snap, Pinterest, Meta, and Twitter higher, but is lifting the entire Nasdaq.

Another day, another disappointing macro data point with manufacturing growth slowing more than expected and inflation higher than expected in this morning’s PMI/ISM data (while EU unemployment fell to a record low – yea really)…

Source: Bloomberg

Sen. Manchin’s comments that Build Back Better is dead spooked stocks after the usual post-opening-plunge dip-buying fest, and sentiment was also not helped by St.Louis Fed’s Jim Bullard reprising his role as ‘bad cop’ noting that QT could start in Q2 and 5 rate-hikes this year is ‘a good bet’…

• 1430ET BULLARD: I DON’T THINK A 50 BASIS POINT INCREASE REALLY HELPS US RIGHT NOW

• 1432ET BULLARD: I THINK MARKETS PRICING IN FIVE HIKES THIS YEAR “IS NOT TOO BAD A BET”

• 1438ET BULLARD FAVORS BEGINNING FED B/SHEET RUNOFF IN SECOND QUARTER

• 1443ET BULLARD: FED B/SHEET RUNOFF CAN BE FASTER THAN LAST TIME AROUND

STIRs were unmoved by Bullard’s hawkishness… given that they are already there…

Source: Bloomberg

A last-hour panic-bid lifted all the majors into the green on the day with Small Caps outperforming

Was the Build Back Better and Macro data ‘bad news’ just bad enough to be good?

Small Caps gains managed to erase all the post-FOMC losses finally (rest of majors are already well above that level)…

The Dow and S&P rallied back above their 200DMAs. The Dow surged up to its 100DMA…

XOM soared today after earnings to its highest since April 2019…

Shorts were squeezed once again

Leaving dip-buyers rejoicing…

VIX was clubbed like a baby seal, back to a 22 handle, as panic hedges were puked…

The belly of the curve underperformed today but overall – despite some whipsawing – the bond market ended the first day of Feb relatively quietly…

Source: Bloomberg

For context, the curve is still dramatically flatter post-Fed with 30Y practically unchanged while 2Y yields are up 15bps…

Source: Bloomberg

The dollar continued to slide, almost erasing all of the post-FOMC spike gains…

Source: Bloomberg

Cryptos were relatively quiet today with bitcoin very marginallyhigher and Ethereum outperforming…

Source: Bloomberg

XOM soared today despite oil prices actually closing lower, with WTI chopping around $88 ahead of tonight’s API inventory report…

Gold pumped and dumped to start February but ended back above $1800…

Finally, this morning’s disappointing ISM data suggests cyclicals have a long way to go still relative to defensives before reality dawns once again…

Source: Bloomberg

And longer-term moves (of more than an hour maybe?) will likely care about the resumption of earnings revision breadth’s downtrend…

And that fun-durr-mental weakness is happening as the market’s main pillar of support – an ever-expanding Fed balance sheet – is about to reverse.

With the rollercoaster that was January market still fresh in everyone’s mind, Deutsche Bank’s Jim Reid published his monthly “best and worst” asset return analysis, and also shared some January performance bullets today after a fascinating month.

• S&P 500 -5.26% (-11.40% at the intra-day lows on 24th). NASDAQ -8.98% (-16.30% at lows). Euro Stoxx 600 -3.81% (-6.82% at lows).
• 10yr US treasuries +26.7bps (+39.1bps intra-day on 19th).
• 2yr US Treasuries +44.6bp (+49.2bps on 28th).
• Fed hikes for 2022 up from 2.96 to 4.94 (5.06 high on last day of month).
• 10yr Bunds +18.8bps (closed month at the highs).
• Brent Crude (+17.3%) and WTI (+17.2%) both seeing their strongest gains in 11 months. Former above $90 for first time since 2014.
• Dollar was strongest G10 FX (+0.9% gain) after +6.4% in 2021. 18-month highs on 28th.
• CDS: EU XO +40bps (+51bps at 28th wides). EU IG +11.1bps (+13.7bps at wides).
• CDS: HY CDS +46.5bps (+57.5bps at 28th wides). US IG +10.5bps (+14.9bps at wides)
• Bitcoin (-17.0%) fell for third month, joined by XRP (-26.5%), Ethereum (-27.3%) and Litecoin (-25.3%).
• Covid: Up from 9.2m weekly global cases to 23.1m in January. Weekly global fatalities up from 44.1k to 66.6k. However, peak weekly number in pandemic before Omicron was a relatively low c.6m weekly cases but over 100k (confirmed) fatalities. So a huge swing.

With these highlights in minds, DB’s Henry Allen writes that the biggest market theme in January was undoubtedly the hawkish pivot by multiple central banks in response to continued and persistent inflation. The Fed in particular has been at the forefront of this, and over the month investors moved to price in a much more aggressive pace of hikes relative to their expectations around the New Year. Indeed, Fed funds futures have gone from pricing 2.96 hikes in 2022 at the end of December, to 4.94 hikes by the end of January.

Furthermore, markets are seriously considering the prospect of back-to-back hikes, with a second full hike priced in by the subsequent meeting in May, and Fed Chair Powell notably refused to rule out the prospect of tightening at every meeting for the remainder of the year.

So with the prospect of tighter monetary policy much earlier than anticipated, risk assets struggled in January, with global equities seeing their worst monthly performance since March 2020, at the height of the initial wave of the Covid-19 pandemic. Credit also struggled on both sides of the Atlantic, as did traditional haven assets like sovereign bonds and precious metals.

The other main theme was rising tensions between Russia and the West over Ukraine, which further dampened sentiment among risk assets. That said, growing tensions did prove supportive for oil prices, with Brent crude surpassing $90/bbl in January for the first time since 2014. The increase in the perceived risk of conflict also sent European natural gas futures higher, which are up +20.4% over the month, although they’re still beneath their peak late last year, having lost -24.0% in December.

Which assets saw the biggest gains in January?

• Oil: After its impressive gains in 2021, oil held onto its position as the top-performing major asset in January as well, with Brent Crude (+17.3%) and WTI (+17.2%) both seeing their strongest gains in 11 months. Growing geopolitical risk played a role in supporting prices, in light of rising tensions between Russia and the West over Ukraine, not least given Russia is one of the world’s biggest oil exporters. In addition, the fact that the Omicron variant is proving to be less virulent and is not leading to major lockdowns has raised hopes that further restrictions on mobility will be avoided.
• US Dollar: The dollar was the strongest performer out of the G10 currencies in January, with the dollar index hitting an 18-month high thanks to a further +0.9% gain. The currency’s strength came as investors moved to price in a more aggressive series of rate hikes from the Federal Reserve this year, and follows its +6.4% gain in 2021.

Which assets saw the biggest losses in January?

• Equities: Risk assets suffered significantly as central banks adopted a more hawkish tone, bringing into question the sustainability of current valuations. In total return terms, the S&P 500 (-5.2%) suffered its worst monthly performance since March 2020, at the height of the initial wave of the pandemic, whilst Europe’s STOXX 600 (-3.8%) also lost ground. Tech stocks led the selloff, with the NASDAQ (-9.0%) seeing even larger declines that made it the worst performer in our entire sample. One of the few to see a positive return were bank stocks, supported by higher yields.
• Credit: It was a bad month across the board in credit as well, with January marking the first time since March 2020 that every credit  index in our table moved lower, across all of USD, EUR and GBP. US credit underperformed in particular, with US HY down -3.0%, and IG non-fin down -3.4%.
• Sovereign bonds: As with credit, sovereign bonds lost ground across the board, and US Treasuries (-1.9%) underperformed their European counterparts such as bunds (-1.1%) and OATs (-1.2%). Indeed, it was the worst monthly performance for US Treasuries since February 2021. BTPs (-0.6%) were a relative outperformer, thanks to easing concern over political risk given the re-appointment of President Mattarella, which has enabled the Draghi government to continue in office.
• Cryptocurrencies: It was a bad month to be in cryptocurrencies as the selloff from late-2021 continued. Bitcoin ended the month down a further -17.0% in its third consecutive decline, and others including XRP (-26.5%), Ethereum (-27.3%) and Litecoin (-25.3%) suffered significant losses as well.
• Precious Metals: The hawkish pivots by central banks helped to undermine the position of precious metals as a hedge against inflation, with both gold (-1.8%) and silver (-3.6%) declining over the month.

Finally, here is the visual return of assets both in local currencies and USD, for the month of January (which is also the YTD period).

Authored by Daniel Lacalle,

I was surprised to see a tweet from President Biden showing the GDP (Gross Domestic Product) of the United States for 2021 compared to the average GDP growth under other presidents. The Tweet stated “This didn’t happen by accident. Because of the actions we took, last year we achieved the fastest economic growth in nearly four decades.”

The first thing we must remind the president is that a recovery from a massive crisis is not “growth.”

Unfortunately, this marketing tactic is not new.

When Biden was vice-president under Obama, they always compared growth and jobs of the president’s tenure excluding the first year, 2009.

Presidents tend to compare their figures favourably, but to talk about 2021 as the “fastest economic growth in nearly four decades” is misleading.

First, recovering the GDP after a massive crisis is not growth. After falling 3.5%, a 5.7% recovery is not “the fastest economic growth” in forty years. It is a bounce. Furthermore, when inventory build contributed a massive 4.9 percentage points to the 6.9% increase in real GDP of the fourth quarter, we should be cautious. This factor is likely to fade in the first quarter and points to slower growth in 2022.

Second, because 2020 and 2021 saw the largest increase in federal debt in decades. After a $3.1 trillion deficit in 2020, the largest in history, and another historic record deficit in 2021 of $2.7 trillion, the United States’ economy has shown a much larger debt increase than GDP recovery. Current-dollar GDP increased by $2.10 trillion in 2021 to a level of $22.99 trillion, in contrast to a decrease of 2.2 percent, or $478.9 billion, in 2020. This means that the United States economy has barely grown at all after adjusting for the massive increase in debt.

The United States government has consumed 3.5 times more debt than the GDP accumulated in two years.

Third, because the 2021 GDP growth comes with the highest inflation figure in 39 years, a 7% increase in CPI. This means that real wages have plummeted, and consumers are suffering while small and medium enterprises see declining margins.

The slowdown in economic growth that the United States is likely to see in 2022 is an important risk. Industrial production, retail sales and job creation have slowed down notably in the past three months. Let us not forget that the labor force participation rate has been stagnant for a year.

These figures show that the recovery is extremely complicated. More importantly, what these figures show is the extremely poor multiplier effect of government spending and the stimulus plans.

If we put this recovery in the context of the largest monetary and fiscal stimulus in recent history, with two record-high deficit prints, what the Biden tweet shows is the poorest recovery adjusted for debt and monetary support in many decades.

No administration since World War II has used such immense policy actions to deliver above-trend growth and a rapid recovery. However, despite the almost unlimited use of government spending and Federal Reserve resources, including negative real rates and the lowest borrowing cost of government debt in decades, the reality shows an extremely poor and diminishing return of the fiscal and monetary space.

This is also the problem of many economists’ and investment banks’ analysis. No one seems to care about the massive debt surge and the appalling return on investment of the stimulus plans. If there is something that resembles “growth,” politicians are happy.

But there is a much deeper issue. The accumulated debt will be a burden on growth and jobs in the future, is likely to trigger massive tax increases and, additionally, the placebo effect of the spending plans fades away rapidly. The United States government consumes $1 trillion stimulus plans as of it did not matter.

There is a bounce after such massive adrenaline injection into the economy. But the bounce is clearly insufficient and low quality. The result is higher inflation and no discernible multiplier effect of the spending programs approved because most of the recovery comes from the re-opening of the economy, not from stimulus.

This, unfortunately, is typical in many economies. A lot more debt for weaker growth and higher inflation.

The Biden tweet states that “this is no accident.” He is right. It is more like a Keynesian trainwreck.

Before making its infamous bet on Gamestop, Melvin Capital Management was a well-respected, multi-billion AUM hedge fund thanks to its founder, Gabe Plotkin, and his close ties with Wall Street legends like Steve Cohen. One year later, having been dragged in front of Congress and publicly humiliated by having the losses from his GameStop short held up in the business press as one of the worst bets of all time, Plotkin is in surprisingly good shape – reputationally speaking.

After Melvin suffered a 17% drop in its main long-short (more longs than shorts now) fund during January’s market rout, Bloomberg reported that Melvin is stil somehow in the process of raising a new ‘long only’ fund (just as the Fed is supposedly about to start hiking interest rates to ‘aggressively tame’ inflation and send equities into another bear market).

A Bloomberg reporter pointed out that Melvin and Plotkin had filed paperwork with the SEC to register a fund called “Melvin Capital Long Only LP”. Melvin Capital Long-Only Offshore.

The paperwork shows that the new fund will be managed out of Melvin’s headquarters on Madison Avenue in Manhattan. As for the money under management, Melvin didn’t disclose that (readers can find Melvin’s Form D below).

As we said the other day, it might be hard to believe, but Plotkin still has some admirers on Wall Street, who regarded Melvin as “especially gifted” at shorting (that is, before they took on what must have been one of the worst shorts in the history of the American securities markets). Steve Cohen himself has said that among the hundreds of portfolio managers who had worked for him, Plotkin was one of the most ” disciplined and process-oriented” – whatever that means.

We also joked last year about Melvin going “long-only” – and then posting another heartbreaking loss for its LPs.

Fortunately for Plotkin, he has some pretty influential (not to mention wealthy) backers: both Steve Cohen’s new firm and Citadel’s hedge fund arm provided Plotkin with an influx of cash after he closed his short position on GameStop, losing 55% of his investors’ money in the process.

It’s not clear whose money will be going into this new “long only” vehicle, but we imagine Plotkin’s association with Cohen and Griffin will be a major asset.

Unfortunately for Plotkin and his compatriots at Melvin, making money in the market is a lot easier when asset prices are riding a wave of Fed-induced easy money, scoring dozens of all-time highs in a given year.

While one hedge funder after another has been appearing on CNBC this week to proclaim that a bear market is simply an opportunity to produce “alpha”, their returns are telling a different story.

Melvin Form d by Joseph Adinolfi on Scribd

Authored by Jack Phillips via The Epoch Times,

The U.S. federal prison system was placed on lockdown nationwide following a deadly incident at a Texas prison, officials said Monday.

“Multiple inmates were observed fighting at the United States Penitentiary Beaumont” in Texas, said the Federal Bureau of Prisons in a news release.

Prison staff then “immediately secured the area” but found inmate Guillermo Riojas and inmate Andrew Pineda with life-threatening injuries, prison officials said.

They were transported to a nearby hospital, where they were both pronounced dead, the bureau said.

Meanwhile, it added, “Two additional inmates were transported to a local hospital for further medical assessment and treatment.”

Due to the incident, which was not described in detail by the Bureau of Prisons, the entire federal prison system was placed on temporary lockdown.

The agency said in a statement that it was acting out of an “abundance of caution” and facilities would be locked down as “a temporary measure to ensure the good order of our institutions.” Officials added, “We anticipate this security measure will be short-lived.”

Federal prison officials “will continue to monitor events carefully and will adjust its operations accordingly as the situation evolves,” the statement continued. “For safety and security reasons, the [Bureau of Prisons] does not elaborate on specific security procedures.”

Unnamed sources with the bureau told The Associated Press that the incident involving the Beaumont inmates was linked to the MS-13 street gang.

Rojas was serving a 38-year prison term for carjacking and other charges, while Pineda was serving a six-year sentence for racketeering, the news release said.

During a nationwide lockdown of prisons, inmates are generally confined to their cells, and visitors aren’t allowed. A number of prisons already have restrictions in place due to the two-year-long COVID-19 pandemic.

There are 122 federal prisons within the United States, according to the bureau’s website. USP Beaumont is considered a high-security facility with about 1,400 inmates, the website says.

Over the past several months, there have been reports of serious security issues within the federal prison system, including deaths and stabbings. In January, the Department of Justice, which oversees the Bureau of Prisons, confirmed to news outlets that the agency’s director, Michael Carvajal, is resigning from his post.

Carvajal, who took over the prison system in early 2020, “helped steer it during critical times, including during this historic pandemic,” said the Department of Justice in a statement. He will remain in his current role “until a new director” is named, the agency said.

The Epoch Times has contacted the Bureau of Prisons for comment.