by Zero Hedge - September 24th, 2016 9:30 pm
Immigration has been and will continue to be a hot button topic in the 2016 presidential campaign. Trump has called for a wall along the U.S. southern border with Mexico and a halt to all immigration from certain “countries of concern to national security.” Meanwhile, Hillary has called for more relaxed immigration policies that would grant illegal immigrants a path to citizenship and a surge in Syrian refugees.
But, no matter where you stand politically on immigration, a group of the nation’s “smartest” professors from the most elite schools in the country recently came together to publish a 500-page study for the “National Academies of Sciences, Engineering and Medicine” on the economic and fiscal impacts of immigration. After what must have been countless months of research, the report seems to confirm what most people could have derived from applying simple logic, namely that while immigration expands the economy it also negatively impacts the employment of low-skilled native workers and places undue burden on federal and state entitlements like food assistance programs and Medicaid.
The full 500-page immigration study can be reviewed at the end of this post but here are the key takeaways…
First, the study finds that the lower median age of immigrants is a positive offset to the aging U.S. population and serves to enlarge the economy but notes that the key beneficiaries are the immigrants themselves and not the native citizens.
Immigration enlarges the economy while leaving the native population slightly better off on average, but the greatest beneficiaries of immigration are the immigrants themselves as they avail themselves of opportunities not available to them in their home countries.
That said, low-skilled immigrants, which represented nearly 50% of the total in 2012, were found to have a higher employment rates than low-skilled natives indicating that U.S. citizens are being displaced at least at the lower bound of the income spectrum.
Shortly after arrival in the United States, immigrant men—especially recent cohorts—experience a disadvantage relative to native-born men in terms of the probability of being employed. However, for cohorts of immigrants arriving since the 1970s, after this initial period of adjustment in which their probability of employment is
by ValueWalk - September 24th, 2016 9:15 pm
By Independent Trader. Originally published at ValueWalk.
Greeks have to declare all their wealth
From January 2017, 8.5 million Greek citizens have to file a declaration of their belongings. The government is on the hunt for real estate, jewellery, art and even cash – outside the banking system.
Before government implements new tax, a directory of the soon-taxed wealth has to be prepared. Today Greece is required to auction public riches to service their debt. The debt which is impossible to be repaid even if all priceless monuments are sold. What is worse is a conflict between the IMF and the German government. A compromise between those two has not materialised yet, making Hellenic country afraid of every round of financial help negotiations. This time, the Greek government has to hedge against another crisis on the horizon – lack of liquidity – and money will be taken from those who still have some savings in one form or another.
Rating agencies – economic weapon of the USA
Far from being news – the US uses rating agencies as a weapon of economic warfare against countries trying to become independent from the superpower. Erdogan’s Turkey is in the cross hairs now. First cut came after failed coup (mid-July).
How to distinguish an attack from yet another revision of credit risk? Because what Moody’s and S&P did have little economic reasoning behind it. The failed coup had little economic fallout, but instead diplomatic ties with Russia and Israel became warm. This will translate into a better economic position of Ankara.
Tourism is one of the key sectors in Turkey’s economy. This is why shooting down Russian jet had dire political and economic consequences – empty rooms in Turkish hotels. After Erdogan apologised and renewed contact with Moscow, Russian tourists returned to their favourite resorts. Ankara and Moscow dusted off investment plans (Turkish Stream and others), signed new trade deals and removed sanctions. All those circumstances tend to paint a positive picture for a future rating increase. However, plans to remove Erdogan after the failed coup are still in place and if military means failed then economic arsenal is being used. By increasing the cost of servicing debt, the government in Ankara tasted the weapon of choice to force Turkey’s submission.
China and Russia to double the efforts to help Syrians
Chinese and Russian military delivers humanitarian help for
by Zero Hedge - September 24th, 2016 9:00 pm
Perplexed global public opinion holds its breath at the (circus) best American “democracy” is able to conjure.
The first cage match this coming Monday between a Queen of War profiting from a mighty (Clinton) Cash Machine and a billionaire uber-narcissist adored by a “basket of deplorables”.
This is a circus quite fitting for a self-described “indispensable nation” where “evil” has been propelled – seriously – to the status of philosophical category.
For the basket of deplorables, and even beyond their circle, the temptation is immense to equate voting for Donald Trump with raising a finger against the establishment.
Ultra-savvy at playing mainstream media for invaluable free publicity, elevating Outrageousness to an art form and being impervious to irony and derision, Trump has been a master at tapping wave after wave of anger against the new liberal elite — including a nomenklatura of crypto-intellectual Ivy league-educated “experts” who could not give a damn about understanding the (real world) consequences of United States Government (USG) policies. The anger is manifested by declassified blue collars, the unemployed, the functionally illiterate, white trash. Whatever you call them, they are the excluded form the Neoliberal Banquet, not only economically but also culturally. But this being Trump, a master of self-promotion, the battle is more like Ego against The Establishment. And it gets juicier when we learn from powerful, discreet New York-based interests – supporters of Trump’s platform — about who’s really winning:
“The Trump campaign is hardly spending any money at all and holding all over. They may use their money in the last month after the debates if Hillary recovers for those debates from what appears to be an attack of Parkinson’s. He has a shot though no matter who wins I predict there will be peace with Russia; the oil price will rise; imports from Asia of military parts will be repatriated and rigging of currencies is over; there will be offsetting measures to stop the flood of immigrants and products under mis-valued currencies. The masters do not lose.”
The “masters” are of course the Masters of the Universe who really run the USG.
And here’s the clincher on how’s in control:
“Both sides are controlled and that explains everything. Lenin said that the way to defeat our opponents is to take over their leadership of the opponent. Look at the Moral Majority which Jerry Falwell disbanded when it became too powerful. Look at Ross Perot who exited when he started making a real dent. Both were taken care of and Ross made money out of it.”
by Zero Hedge - September 24th, 2016 8:28 pm
No matter the outcome of the presidential election, according to BofA’s Chief Investment Strategist, Michael Hartnett, 2017 will likely be a year of small absolute returns as the bank expects higher rates will collide with high bond and equity valuations, but it will be a year of big rotations “as investors shift from ZIRP winners like bonds, US, growth stocks to ZIRP losers like commodities, banks and Japan”, where BofA forecasts 20,000 on Nikkei, although for that to happen the currency would have to implode in what may be a terminal loss of faith in the central bank.
Still, with all attention now focused on the key risk event until a potential December rate hike, namely the November 8 presidential election, BofA provides 8 specific election trades for the election.
In a note titled “Eight election trades for Nov 8th”, Hartnett shares a variety of trade ideas, some “election-specific and some result-dependent: long VIX futures; long AUDUSD vol; long TIPS; long global E-commerce, short fast restaurants (inequality); long US materials and largecap banks (fiscal); long US small caps, short emerging markets (Trump protectionist); long gold, short EU banks (Trump geopolitics); long Mexican peso (Clinton victory).”
This is what he says:
On November 8th, the US Presidential election will take place. Below we list eight trades, all specific to the election, some applicable to whoever wins, some dependent on the election result:
Long VIX futures. It seems an obvious trade, but the election is likely to be close (see latest projected electoral college result – Chart 4). There could even be a statistical tie in the Electoral College if Trump wins FL, OH, NC, WI, IA, and Clinton wins PA, VA, CO, NV, MI, NH, arguably the most volatility-inducing event of all. VIX futures are the most liquid expression of volatility, and ahead of the first Presidential debate, the cost of a Nov’16 hedge has fallen to the 19th percentile vs. the past year.
Long AUDUSD volatility. One way to invest in a risk-off scenario in the event of a Trump victory is long AUDUSD volatility. In our most recent FMS, a Republican victory was seen as a much greater “tail risk” for markets than a Democratic win. Trump has a more protectionist stance, and has threatened import tariffs against China, a stance that would unsettle Asian
by Zero Hedge - September 24th, 2016 8:00 pm
Colorado has been a key swing state in recent presidential elections after flip-flopping back and forth between support for Democratic and Republican candidates. Obama won the state in the past two elections but George Bush prevailed for the two preceding contests while Bob Dole narrowly eked out a victory against Clinton in 1996.
That said, the margin of victory has often been very tight in Colorado which is what makes the recent discovery of voter fraud there so concerning. An investigation by CBS Denver recently found that dozens of deceased Colorado citizens continued voting multiple years after their death…even though Colorado Secretary of State Wayne Williams assured CBS that “it is impossible to vote from the grave legally.” While we’re disturbed by the voter fraud in Colorado, we’re so glad that the legality of the issue could be cleared up so easily.
According to CBS, one of the most glaring cases of voter fraud they found was of Sara Sosa who lived in Colorado Springs. Sosa died on Oct. 14, 2009 but CBS found that she continued to cast her ballot in 2010, 2011, 2012 and 2013. Likewise, her husband, Miguel, died on Sept. 26, 2008 but voted later in 2009.
Colorado’s Secretary of State confirmed the cases of voter fraud discovered by CBS, saying:
“We do believe there were several instances of potential vote fraud that occurred. It shows there is the potential for fraud. It’s not a perfect system. There are some gaps.”
Of course Colorado isn’t the only place where voter fraud occurs. Project Veritas recently recorded a series videos in Michigan showing just how easy it is to vote as someone else. In the following video, the Project Veritas journalist claims she is Jocelyn Benson, the Dean of Wayne State University Law School, but that she lost her ID. The “Poll Supervisor” is quick to reassure Mrs. Benson that as long as she signs the affidavit on the back of the ballot she is free to vote. When the journalist pushes back and insists that she feels an obligation to prove her identity the Poll Supervisor reassures her that “nobody can vote twice” because if the real Jocelyn Benson subsequently comes in she won’t be able to vote “because you already
by ValueWalk - September 24th, 2016 7:51 pm
By JOHN F. BANZHAF. Originally published at ValueWalk.
Keith Lamont Scott Released Charlotte Tapes Reportedly Ambiguous, This Helps The Cops
No Definitive Visual Evidence of Gun, But Belief By Cops Could Still Be Reasonable
Charlotte Police Chief Kerr Putney has just announced that he will be releasing portions of the two videos relating to the fatal police shooting of Keith Lamont Scott, but that the tapes provide no definitive visual evidence that the suspect had a gun. There’s no absolute certainty, he said.
But the shooting may nevertheless be legally justified even if the officer could not be sure that the suspect had a gun, since the officer who shot need only have a reasonable belief that a gun was present.
More precisely, the officer can be found guilty only if the prosecutor can prove, beyond any reasonable doubt, that the officer’s belief that the suspect was holding a gun was unreasonable.
Moreover, although some have argued that the gun may have been present, but that it hadn’t been pointed towards anyone, that question may be irrelevant as well as misleading in light of a recent study.
That study shows that, because of delays caused by reaction time, officers should not wait until a subject holding a gun actually points it at someone, and that shooting before that happens meets the reasonable test the U.S. Supreme Court has established, says public interest law professor John Banzhaf.
Banzhaf has taught the law of self defense for more than 40 years, provided legal analysis to justify the self defense shootings of New York’s “subway shooter” Bernhard Goetz, DC’s “jacuzzi shooter” Carl Rowan as well as others, and correctly predicted the outcomes of many recent police killing cases, as well as the Zimmerman verdict.
Putney recently emphasized the issue of “pointing”: “what I can tell you that I saw … the video does not give me absolute definitive visual evidence that would confirm that a person is pointing a gun.”
But a very careful study shows that even well trained police officers, if they wait until a suspect they are holding at gunpoint actually begins to point his weapon, will usually be shot and perhaps even killed before they can fire their own already-drawn weapons.
by Zero Hedge - September 24th, 2016 7:28 pm
China’s favorite offshore money laundering hub is officially no longer accepting its money.
According to data released by British Columbia’s Ministry of Finance on Thursday, foreign investors officially disappeared from Vancouver’s property market last month after the local government imposed a 15% surcharge to curb a record-shattering surge in home prices. Overseas buyers accounted for a paltry 0.7% of the C$6.5 billion of residential real estate purchases in August in Metro Vancouver; this represents a 96% plunge from the seven weeks prior, when foreigners were responsible for 16.5% of transactions by value.
According to the latest data overseas buyers snapped up C$2.3 billion of homes in the seven weeks before the tax was imposed, and less than C$50 million in the next four weeks. The government began collecting data on citizenship in home purchases on June 10. The ministry said auditors are checking citizenship or permanent residency declarations made by buyers and also reviewing transactions to determine if any were structured to avoid tax (spoiler alert: most of them were).
Across the province, the participation of foreigners dropped to 1.4% of transactions by value in August, from 13% in the preceding seven weeks.
Prior to the new real estate tax home prices were almost double the national average of C$473,105; however we expect a sharp corretion in the coming weeks – as we pointed out at the beginning of September, the average price of detached Vancouver properties promptly crashed following the news tax, dropping 17% on the month, and 0.6% on the year, to C$1.47 million ($1.13 million) in August, wiping away one year of gains in a few weeks.
As Bloomberg notes, the plunge in foreign participation joins other signs of a slowdown in Canada’s most expensive property market.
The silver lining is that while transactions may have ground to a halt, the government did pick up some extra tax revenues: British Columbia has raised C$2.5 million in revenue from the new levy since it took effect. Budget forecasts released last week indicated that the Pacific coast province expects foreign investors to scoop up about C$4.5 billion of real estate through March 2019.
That may prove optimistic, because as reported two weeks ago as Chinese buyers wave goodbye to Vancouver, they have set their
by Zero Hedge - September 24th, 2016 7:00 pm
Alan Greenspan is confused – again. The man who admitted to the world a decade ago he didn’t know much if anything about interest rates is now trying to change that reputation by suggesting yet again interest rates are set to rise. In testimony before Congress in February 2005, the then-Chairman of the Federal Reserve actually said:
For the moment, the broadly unanticipated behavior of world bond markets remains a conundrum. Bond price movements may be a short-term aberration, but it will be some time before we are able to better judge the forces underlying recent experience.
To an economist, it was a “conundrum” especially where econometrics and statistics and take the dominant view (if it can be called that). That is one facet to the Greenspan story that is so odd yet so compelling in all the wrong ways. Though he was an economist by schooling, he had more practical experience in the “real” world. He served on boards of such illustrious companies as Alcoa, General Foods, even Mobil. But he was also a director for JP Morgan and Morgan Guaranty.
He should have known better, as his infamous 1966 essay on gold reveals. Thus, we can reasonably assume that what transformed his worldview was not economics (small “e”) but rather power. Not only had he been appointed to major corporate boards, he was heavily involved in politics, including the kinds that are the stuff of conspiracy theories.
By 1995, as Fed Chairman, Greenspan was widely and wildly credited as guiding the US economy through what he claimed was an existential crisis with the Savings & Loan industry bust. Though George HW Bush would blame Greenspan’s Fed in part for his 1992 election lost because of the first “jobless recovery” (a major clue no economist or policymaker investigated honestly), by the middle 1990’s it was believed he had created the recovery itself and then tamed it when he raised rates in 1994 and engineered what many still call a “soft landing.” There have been many who have been dubbed the “bond market king”, but for a long time Dr. Greenspan’s status in that regard was a cut above.
His confusion and “conundrum” in the 21st century belies the reputation that had
by Zero Hedge - September 24th, 2016 6:07 pm
Update: according to some preliminary reports, the explosion may have been caused by a gas leak, although an official version for the cause has yet to be provided.
Police believe the explosion in Budapest was caused by a gas leak, with 2 people reportedly injured https://t.co/yvibz7N3Pc
— ITV News (@itvnews) September 24, 2016
* * *
While the source of the powerful blast that rocked the crowded streets of Budapest this evening is unknown, there is an extremely heavy police presence as multiple injuries (including police officers) are reported.
As Sputink reports, a massive explosion struck the central area of the Hungarian capital of Budapest late Saturday night. Social media video shows a heavy police presence at the Oktogon intersection while eyewitnesses are reporting that several casualties occurred as a result of the blast. At least two people injured in the blast were taken to a hospital according to Hungarian Blikk daily newspaper reports citing local emergency services. The two injured people reported by the outlet are believed to be police officers.
— Jkv (@climbingjonny) September 24, 2016
— Diario Al Instante (@daidiario) September 24, 2016
Terract in Budapest right now pic.twitter.com/cpevRzDerW
— Eva Berger (@nad8348) September 24, 2016
— C Rohit Anand Singh (@rohit12ras) September 24, 2016
by Zero Hedge - September 24th, 2016 5:54 pm
The latest confirmation that the US economy continues to deteriorate comes not from the Federal Government but from state-level data, where year-over-year growth in state tax revenues slowed in the first quarter to its lowest rate since the second quarter of 2014, according to the latest data published yesterday by the Rockefeller Institute of Government. Worse, preliminary data for the second quarter show an outright decline in state tax collections relative to the second quarter of last year.
As SMRA notes, state tax collections were up 1.6%, year-over-year, in the first quarter, the smallest increase since the second quarter of 2014. After adjustment for inflation, revenues were up 0.4%. Personal income tax collections, which account for roughly 36% of total state revenue, increased 1.8% in the first quarter, down from 5.1% in the fourth quarter. Sales tax collections – the second largest source of state revenue – increased 2.4% in the first quarter, up from 2.0% in the first quarter.
The trend deteriorated further in preliminary Q2 data with personal income tax tumbling nearly 5% Y/Y.
Corporate tax receipts, which account for less than 5% of state revenues, were down sharply for the second consecutive quarter, while motor fuel taxes, which also account for just under 5% of revenues, were up 2.0%, down from 3.5% increase in the fourth quarter.
According to preliminary estimates from Rockefeller, tax collections will be down 2.1% in the second quarter relative to last year, reflecting a decline of 3.3% in personal income taxes and a 9.2% plunge in corporate tax collections.
Sales tax revenue is estimated to have increased.
Rockefeller attributes the recent softness in personal income tax collections to a variety of factors, including weakness in the stock market, in both 2015 and the earlier part of this year, which has depressed tax collections related to investment income. Tax collections have been particularly weak in states with economies that are heavily reliant on oil or other natural resources. In the second quarter, growth in individual income taxes from withholding has slowed considerably.
The suddenly plunge in state income tax should not come as a surprise: the trend in individual income taxes at the state level in recent quarters tracks the sharp decline we have reported previously at the federal level.