Everybody did it in Agatha Christie’s novel Murder on the Orient Express, and the same problem bedevils the US stock market today. A dozen co-conspirators killed the victim in the Christie novel. Here are a dozen factors that bedevil the stock market:
1) Bond yields continue to rise even while the broad stock market indices tank which is an unusual event. That, as I argued earlier this week, is in part due to the overstretching of bank balance sheets, which makes it hard for foreign investors to hedge currency risk in US portfolios.
Only on 11 trading days since the end of 2007 have bond yields risen while the S&P 500 fell by more than two standard deviations, or 0.3% of the time. That makes today’s toxic combination of rising yields and falling stock prices extremely rare and most unwelcome.
2) Corporations spend more buying back their own stock than on capital expenditures, reducing the number of shares outstanding and thereby increasing ratio of earnings to shares. That does nothing for productivity or long-term growth, and can’t go on forever.
3) Corporate profits in the US actually fell during the year ended in the second quarter of 2018, before adjustment. Federal statisticians say this was due to accelerated depreciation under the 2017 tax cut, and adjust the data to show a shadow profit. But the raw numbers show a decline, and shadows are just shadows.
4) Oil prices are going up and that’s bad for consumers.
5) Tariffs on China are hitting the US supply chain and cutting corporate profits for many companies.
6) The Federal Reserve thinks that everything is wonderful and is raising interest rates.
7) Consumption continues to rise, but that is increasingly dependent on increasing credit card balances.
8) Hourly and weekly earnings are barely keeping pace with inflation.
9) Purchases of major household assets like homes and cars is falling, and is likely to fall further with higher interest rates, and homebuilders and car companies are among the market’s worst performers.
10) Tech companies that got rich providing software to run on cheap hardware imported from China have to reckon with higher costs for electronics under a 25% tariff regime, and can’t sustain their lofty multiples.
11) The United States is pursuing a new Cold War with China, as the doyen of conventional wisdom, Walter Russell Mead, put it in the Wall Street Journal. That goes beyond trade war and raises strategic risks.
12) The Republicans are likely to lose control of the House of Representatives in next month’s midterm elections, adding to an already chaotic atmosphere in Washington. Say what you want about President Trump, but he has been good for the stock market, and a Democratic revival won’t be.
In short your great fascist saviour Trump is fecking it all up. Who would have guessed it ! Bonanza over, Spengler.
In short your great fascist saviour Trump is fecking it all up. Who would have guessed it ! Bonanza over, Spengler.
Nothing to add to the article, besides de fact that what the American economy is suffering is more similar to a multiple organ failure than an "Orient Express" gang murder.
The key here it the interest rate: the US economy is like a 100-year old man who depends on 10 different pills and a 24/7 nurse team to be alive — even one little change in the routine will be fatal.
Nothing to add to the article, besides de fact that what the American economy is suffering is more similar to a multiple organ failure than an "Orient Express" gang murder.
The key here it the interest rate: the US economy is like a 100-year old man who depends on 10 different pills and a 24/7 nurse team to be alive — even one little change in the routine will be fatal.
Unfortunately you always ignore the facts in all your articles.
1) Oil prices are going up for only one reason. Following Israels doom policy against Iran.
2) all business combined have list close to $600 Billion if business due to Iran sanction…do you need a reminder on who is behind those policies?
While Obama was painstakingly was trying to dig the US economy out of the while, the boys in Tel Aviv rigged the election in favor if Trump.
The bumpy road has just begun as we will see regime change in Saudi Arabia in the next 6 months.
Unfortunately you always ignore the facts in all your articles.
1) Oil prices are going up for only one reason. Following Israels doom policy against Iran.
2) all business combined have list close to $600 Billion if business due to Iran sanction…do you need a reminder on who is behind those policies?
While Obama was painstakingly was trying to dig the US economy out of the while, the boys in Tel Aviv rigged the election in favor if Trump.
The bumpy road has just begun as we will see regime change in Saudi Arabia in the next 6 months.
The stock market has traditionally done better under Democrats than Republicans.
The stock market has traditionally done better under Democrats than Republicans.
Public and private debt is just too high and something will give when prices rise.
Public and private debt is just too high and something will give when prices rise.
1) The days of USD as a hegemonic reserve currency is numbered in 1-2 decades when USA accounts only 18% of world trade.
2) There was never real productivity gain from fat lazy slow Americans but only things made in China then slap on a cover and called it made in USA and creative accounting does the rest. This trick is exhausted/spent.
3) Tax cut trick is spent.
4) Trump on Iran.
5) Told U morons China mostly assemble gadgets from stuff from other countries for other countries. There is no perishable goods nor much inventory warehousing. Contrast American farm/meat/seafood exports.
6) Answerable to big banks only.
7) Consumer is spent with layoffs quietly under the radar.
8) The rich won’t share even a little anymore.
9) Rich Chinese aren’t buying or blocked from buying anymore.
10) FANG is operating in saturated market to target/lure consumers to spend money they don’t on things they can’t afford anymore.
11) USA vs Russia + China. Who was winning when China was at its weakest and USA strongest in Korea and Vietnam war? Now China is at its strongest in the few hundred yrs and Russia recovered?
12) Democrats will first undo what Trump did and then do more moronic policies in exactly the opposite way.
1) The days of USD as a hegemonic reserve currency is numbered in 1-2 decades when USA accounts only 18% of world trade.
2) There was never real productivity gain from fat lazy slow Americans but only things made in China then slap on a cover and called it made in USA and creative accounting does the rest. This trick is exhausted/spent.
3) Tax cut trick is spent.
4) Trump on Iran.
5) Told U morons China mostly assemble gadgets from stuff from other countries for other countries. There is no perishable goods nor much inventory warehousing. Contrast American farm/meat/seafood exports.
6) Answerable to big banks only.
7) Consumer is spent with layoffs quietly under the radar.
8) The rich won’t share even a little anymore.
9) Rich Chinese aren’t buying or blocked from buying anymore.
10) FANG is operating in saturated market to target/lure consumers to spend money they don’t on things they can’t afford anymore.
11) USA vs Russia + China. Who was winning when China was at its weakest and USA strongest in Korea and Vietnam war? Now China is at its strongest in the few hundred yrs and Russia recovered?
12) Democrats will first undo what Trump did and then do more moronic policies in exactly the opposite way.
Ever since its Primogenitor Judah sold the Good Joseph into slavery thinking that was end of him, only to see him rise as master of Egypt, Goldman’s Tribe’s brilliance in tactics is exceeded by its blindness in strategy.
For 4,000 years Judah sees the trees but not the forest.
Why parade 12 when one will do? The single and only problem with America and its allies is outreach, within and without – living beyond its means. The Colonies loot may have gone, but the lavish living remains. Even turning childless can not sustain a wasteful lifestyle.
Full 53% of US GDP is “Hegemonic”. Twisting arms of allies to buy worthless arms at inflated prices, or forcing them to accept terms or trade favourable to America. This needs 1000 military bases outside. That costs money.
800 years ago Rumi poetically defined the rich and the poor – earn 20 and spend 19 and you are one, and spend 21 you are the other.
Maggie Thatcher’s famous dictum “the trouble with other people’s money is that it ends sooner or later. Asians have taken note, America has not.
It never pays to “peter plus haut que so cul."
Ever since its Primogenitor Judah sold the Good Joseph into slavery thinking that was end of him, only to see him rise as master of Egypt, Goldman’s Tribe’s brilliance in tactics is exceeded by its blindness in strategy.
For 4,000 years Judah sees the trees but not the forest.
Why parade 12 when one will do? The single and only problem with America and its allies is outreach, within and without – living beyond its means. The Colonies loot may have gone, but the lavish living remains. Even turning childless can not sustain a wasteful lifestyle.
Full 53% of US GDP is “Hegemonic”. Twisting arms of allies to buy worthless arms at inflated prices, or forcing them to accept terms or trade favourable to America. This needs 1000 military bases outside. That costs money.
800 years ago Rumi poetically defined the rich and the poor – earn 20 and spend 19 and you are one, and spend 21 you are the other.
Maggie Thatcher’s famous dictum “the trouble with other people’s money is that it ends sooner or later. Asians have taken note, America has not.
It never pays to “peter plus haut que so cul."