Posts Tagged ‘Dan Gross’

Dan Gross: When Deficits are a Good Sign

Dan Gross: When Deficits are a Good Sign

Courtesy of Joshua Brown, The Reformed Broker 

Dan Gross has been one of the more bullish voices in the econoblogosphere this spring/summer, and his latest piece for Slate is sure to be controversial.  In it, he explains how deficits and surpluses show up out of nowhere and disappear just as quickly…

The fiscal 2010 deficit—$1 trillion and counting—is an encouraging sign.

Let me explain. Federal tax revenues are highly leveraged to economic growth and to the performance of markets, corporations, and rich people. This means they can be volatile. When markets and profits boom, capital gains taxes, payroll and income taxes, and corporate income taxes flow like a mighty stream. As a result, it’s not uncommon for tax receipts to rise 6 percent or 7 percent in a year when the economy grows by 3 percent. This volatility works to the downside, too. When the economy contracts and markets crash, capital gains and corporate income tax revenues dry up. For example, corporate income taxes (click here and scroll down to Page 30) fell from $370 billion in fiscal 2007 to $304 billion in fiscal 2008 (down 18 percent), and then plunged to $138 billion in fiscal 2009 (down 55 percent). In fiscal 2009, a period in which the economy shrunk about 2.6 percent, government receipts plummeted 16 percent, from $2.5 trillion to $2.1 trillion. To aggravate matters, some government spending is countercyclical. That means that in good times, when tax receipts are high, less money is spent on stimulus and social welfare benefits. In bad times, when tax receipts are ebbing, more money goes out the door. And that’s why surpluses and deficits can materialize out of nowhere.

He goes on to point out how the deficit for 2009 came in below expectations as a result of asset price refaltion and other factors.  Without being a fan of long-term entitlements and debt, he makes an interesting case based on the numbers for a toning down of the deficit-hawk rhetoric.

Source:

The Miracle Deficit Cure?  Growth.  (Slate)


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Zero Hedge

China Turmoil Looms As Traders Bet On Post-G-20 Yuan Tumble

Courtesy of ZeroHedge. View original post here.

Something is different this time. For the last few years, China has 'ensured stability' in the Yuan ahead of major geopolitical events - no matter what - only to let things slide back into turmoiling after. Ahead of this weekend's G-20, however, and amid notably deteriorating fundamentals (and an increasingly hawkish-sounding Fed), China has let the Yuan tumble in the last week... and traders are piling into bets on post-G-20 weakness to continue.

As Bloomberg notes, history shows that the Chinese currency usually strengthens ahead of major political or economic event...



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Market News

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Financial Markets and Economy

Apple Must Pay Billions for Tax Breaks in Ireland, E.U. Orders (NY Times)

The European Union on Tuesday ordered Ireland to collect $14.5 billion in unpaid taxes from Apple, a record penalty that worsened tensions with the United States over the bloc’s crackdown on sweetheart deals with global multinationals.

Dol...



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ValueWalk

European Ruling against Apple and Ireland Vindicates Brexit

By The Foundation for Economic Education. Originally published at ValueWalk.

European Ruling against Apple and Ireland Vindicates Brexit

Taxation is bad enough: two consenting parties arrange a mutually-beneficial exchange, and an interloping third party demands a cut.

What compounded injustice then for a fourth party to enter the scene: a super-state/super-bandit who insists that the shakedown wasn’t big enough. No, the victim must hand over more to the lesser thief, even against the recipient’s will and in spite of his protest!

Thou Shalt Not… Not Steal

Ireland must join the rest of the Union in bleeding the private sector dry.

That...



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Phil's Favorites

Do You Believe There is Food Price Deflation? Mish vs. Consensus

Courtesy of Mish.

Here’s the question of the day: Do you believe there is food price deflation?

The reason I ask is the Wall Street Journal reports Food Price Deflation Cheers Consumers, Hurts Farmers, Grocers and Restaurants.

The U.S. is on track this year to post the longest stretch of falling food prices in more than 50 years, a streak that is cheering shoppers at the checkout line but putting a financial strain on farmers and grocery stores.

The trend is being fueled by an excess supply of dairy products, meat, grains and other staples and less demand for many of those same products from China and elsewhere due to the strong dollar. Lower energy costs...



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Chart School

Little Change

Courtesy of Declan.

I'm waiting for bears to step in and reverse the nascent breakout but it hasn't happened yet. The intraday range was tight and the change relative to yesterday was small. This left little to add.

The S&P still has three 'sell' triggers in MACD, On-Balance-Volume and ADX to work off before the rally resumes.


The Nasdaq is creating a mini-bear flag, although confirmation will require a single day loss of at least 1%. It has a more solid technical picture than the S&P.

...

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Kimble Charting Solutions

US Dollar/Yen testing important support zone

Courtesy of Chris Kimble.

The US Dollar/Yen is facing a trio of potential support lines at this time with few people bullish the US$/Yen at Stocktwits. What happens at this potential support zone, could well impact the Risk On trade from now until year end.

CLICK ON CHART TO ENLARGE

The trend in the US$/Yen remains down for the past few months, as the YEN has been stronger than the US$. The US$/YEN remains inside of a steep falling channel over the past 10-months.

The bottom of this steep falling channel and two ot...



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OpTrader

Swing trading portfolio -week of August 29th, 2016

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Biotech

Epizyme - A Waiting Game

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Epizyme was founded in 2007, and trying to create drugs to treat patient's cancer by focusing on genetically-linked differences between normal and cancer cells. Cancer areas of focus include leukemia, Non-Hodgkin's lymphoma and breast cancer.  One of the Epizme cofounders, H. Robert Horvitz, won the Nobel Prize in Medicine in 2002 for "discoveries concerning genetic regulation of organ development and programmed cell death."

Before discussing the drug targets of Epizyme, understanding epigenetics is crucial to comprehend the company's goals.  

Genetic components are the DNA sequences that are 'inherited.'  Some of these genes are stronger than others in their expression (e.g., eye color).  Yet, some genes turn on or off due to external factors (environmental), and it is und...



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Digital Currencies

Man Who Introduced Millions to Bitcoin Says Blockchain Is a Bust

 

Man Who Introduced Millions to Bitcoin Says Blockchain Is a Bust 

By  at Bloomberg

Excerpt:

Stefan Thomas, who introduced millions of people to bitcoin, has had a change of heart.

Blockchain, the ledger software that makes the digital currency possible...



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Mapping The Market

Illusion of Choice

From Jean-Luc:

Looks like we are down to about 10 companies for our consumer goods:

http://www.visualcapitalist.com/illusion-of-choice-consumer-brands/

Just like banks, airlines and cable companies! 

The Illusion of Choice in Consumer Brands

Explore the full-size version of the above graphic in all its glory.

If today’s infographic looks familiar, that’s because it originates from a well-circulated report that Oxfam International puts together to show consolidation i...



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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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