Posts Tagged ‘Main St.’

Wall Street’s “Recovery” Leaves Main Street Mugged in the Gutter

Wall Street’s "Recovery" Leaves Main Street Mugged in the Gutter

Courtesy of Charles Hugh Smith, Of Two Minds 

31st March 1951:  A sandwichman, who carries an advertising board on his shoulders, standing in the gutter on a London street. He is not allowed on the pavement.  (Photo by Charles Hewitt/Picture Post/Getty Images)

Rising costs and taxes and declining income have mugged Main Street while Wall Street revels in the Fed-engineered "recovery"--in the stock market.

The Fed would have us believe that the stock market is the leading indicator of the economy: if stocks are rising, then that is strong evidence the economy is improving.

This is the bogus "wealth effect" I have taken pains to discredit:

Why the Fed’s ‘Trickle-Down Economics’ Is Failing

Are the Fed’s Honchos Simpletons, Or Are They Just Taking Orders? (Nov. 1, 2010)

Fraud and Complicity Are Now the Lifeblood of the Status Quo (Nov. 12, 2010)

Fed’s QE2 Misadventure Costs U.S. Households $4.6 trillion (Nov. 10, 2010)

Main Street didn’t buy "the stock market is rising, so you must be richer" either, for the simple reason that Main Street’s wallet is now much thinner. Even as the S&P 500 has soared 80% from its March 2009 lows, 70% of Americans don’t believe the recession is over.

That must really hurt the apparatchiks in the Ministry of Propaganda and the Fed. Here they go to all this trouble to orchestrate a bogus stock market rally and Mainstream Media propaganda campaign hyping "the recovery," and Main Street America refused to buy it. How irksome.

It seems Main Street’s grasp on reality is firmer than that of either the Fed or its partner, Wall Street.

Let’s consider income.

The stock market rally off the March 2009 lows was by some measures the sharpest such advance in the past 100 years. Yet as stocks went on a tear,household income actually declined. According to the Census Bureau, the median household income fell 0.7% to $49,777 in 2009, down 4.2% since pre-recession 2007.

The Federal Reserve’s stated policy objective is to boost the stock market to trigger a "wealth effect" which will then lead consumers to open their wallets.

As noted here before, the Fed failed to notice that only the top 10% of households hold enough stocks to see much benefit from a rising market. Household income actually fell, despite the huge run-up in stocks.

In other words, a rising stock market did not increase household incomes. The Fed is gambling on an effect with no evidence to support it.

How about jobs?

While the Bureau of Labor Statistics reported that…
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BERNANKE’S GREAT MONETARIST GAFFE

BERNANKE’S GREAT MONETARIST GAFFE

Courtesy of The Pragmatic Capitalist 

I had to chuckle at the headline on Yahoo Finance throughout much of Monday’s trading session:

rateshead BERNANKES GREAT MONETARIST GAFFE

It’s an accurate headline.  Mortgage rates have declined in recent weeks as U.S. government bonds have surged.  But the actual article was filled with very dramatic certainties (most of which were inaccurate and/or misleading).  For instance, the excellent Mark Zandi of Moody’s was quoted saying that we are seeing a once in a generation buying opportunity in real estate:

“It’s the best time in our generation to buy.  It may be the best time in any generation. Mortgage rates are so low and with homes prices down and lots of inventory, you couldn’t pick a better time to buy or re-finance.”

Wow, sounds like we should all go out and buy houses, right?  It gets rosier though.  The article details why we should all run out and buy houses immediately:

But the decline in rates probably won’t last long, analysts say. So homeowners need to move fast.

“I think they won’t last much longer than a month or two at the best,” says Lawrence Yun, chief economist at the National Association of Realtors. “I can see them going up to 5.5 percent by the end of June if not sooner.”

Move fast, huh?  Prices are low.  Rates are going back up.  That sounds pretty convincing.  If interest rates (and home prices) are only going to be low for a brief period then we should capitalize on that opportunity.  Right?   But then the article takes a dramatic turn for the worst when they try to explain the actual fundamentals behind the rising interest rate argument:

“The US is fortunate now that there’s no pressure on interest rates,” Yun goes on to say. “But going forward, higher rates will be needed for financing the debt.”

(Screeching sound).   Uh oh.  Here we go again with the hyperinflation, the USA is dying, the dollar is finished, higher interest rates will be needed to “finance our debt”, argument.  The dots are easy to connect in this article.  In essence, the article implies that interest rates are at record lows because investors have sought the safety of government bonds and mortgage rates have subsequently declined.  What they fail to expand on is why interest rates have been declining in recent weeks when, according to…
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Merkley for Main Street

Merkley for Main Street

By Bryce Cover, courtesy of New Deal 2.0

Senator Jeff Merkley took to the Senate floor on Tuesday, complete with fist pounding, to air his frustration over the blockage of the Merkley-Levin amendment that would fortify the Volcker Rule. The rule restricts banks that have access to FDIC insurance from speculative trading. What he wanted to know: “Why is Wall Street winning and Main Street losing tonight in the US senate?” Watch his passionate speech:

 

See also: Merkley-Levin Amendment Can’t Get a Vote 


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Zero Hedge

Is Sweden A Failed State?

Courtesy of ZeroHedge. View original post here.

Authored by Judith Bergamn via The Gatestone Institute,

  • The Swedish state, in true Orwellian style, fights those Swedish citizens who point out the obvious problems that migrants are causing.
  • When police officer Peter Springare said in February that migrants were committing a disproportionate amount of crime in the suburbs, he was investigated for inciting "racial hatred".
  • Currently, a 70-year-old Swedish pensioner is being prosecuted for "hate speech", for writing on Facebook that migrants "set fire to cars, and ...


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ValueWalk

Learn Warren Buffett's Simple Psychological Trick To Being Persuasive

By VW Staff. Originally published at ValueWalk.

Warren Buffett is one of the most famous investors alive. Here’s one psychological trick he uses to get others focused on his intended message.

]]> Get The Full Warren Buffett Series in PDF

Get the entire 10-part series on Warren Buffett in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues.

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Punch Card Investing Lessons from Charlie Munger The Munger Se...

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Phil's Favorites

Press Secretary Spicer Resigns Following Vehement Disagreement With Trump

Courtesy of Mish.

If nothing else, Trump provides entertainment value for comedians and bloggers.

This morning, we learned press secretary Sean Spicer Resigns as White House Press Secretary following a huge dispute with Trump over communications.

Sean Spicer, the White House press secretary, resigned on Friday after denouncing chaos in the West Wing and telling President Trump he vehemently disagreed with the appointment of the New York financier Anthony Scaramucci as c...



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Digital Currencies

Bitcoin (BTC/USD) Nears All-Time High on Spike Above Daily Chart Downchannel Resistance

Courtesy of ZeroHedge. View original post here.

Bitcoin (BTC/USD) crushed shorts yesterday, smashing above the daily chart's downchannel resistance and soaring towards the all-time high around 3000. With yesterday's massive rally, the negative weekly MACD crossover has been proved a false signal.  Odds are quite good that a sustainable longer term BTC/USD bottom was found last week, especially with ETH/USD also strongly rebounding this past week.  Some consolidation can be expected today with daily RSI and Stochastics tiring, although with daily MACD just having positive...



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Insider Scoop

Bank Of America Says Expectations For Groupon Are Still Too High

Courtesy of Benzinga.

Related GRPN Benzinga's Option Alert Recap From July 18 Watch These 7 Huge Call Purchases In Monday Trade ...

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Chart School

Small Caps Breakout

Courtesy of Declan.

It has taken a few days for Small Caps to make their move but today was the day the Russell 2000 joined other indices in mounting a breakout. It was a clean breakout supported by positive technical strength - putting to bed the June 'bull trap'. Watch for the second round of stop-whips with an intraday move (and recovery) below 1,430.


Other indices added to their breakouts. The S&P gapped and pushed on, backed by higher volume accumulation. Watch for a tag of upper channel resistance.

...

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Members' Corner

Why we need to act on climate change now

 

Why we need to act on climate change now

Interview with Jan Dash PhD, by Ilene Carrie, Editor at Phil’s Stock World

Jan Dash PhD is a physicist, an expert at quantitative finance and risk management, and a consultant at Bloomberg LP. In his thought-provoking book, Quantitative Finance and Risk Management, A Physicist's Approach, Jan devotes a chapter to climate change and its long-term systemic risk. In this article, Ilene interviews Jan regarding his thoughts on climate change and the way it can affect our futu...



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OpTrader

swing trading portfolio - week of July 17th, 2017

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

Immunotherapy: Training the body to fight cancer

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

 

Immunotherapy: Training the body to fight cancer

Courtesy of Balveen KaurThe Ohio State University and Pravin KaumayaThe Ohio State University

An oral squamous cancer cell (white) being attacked by two T cells (red), part of a natural immune response. ...



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Mapping The Market

The App Economy Will Be Worth $6 Trillion in Five Years

Courtesy of Jean-Luc

This would be excellent news for AAPL and GOOG to a lesser extent although not inconsequential:

The App Economy Will Be Worth $6 Trillion in Five Years 

In five years, the app economy will be worth $6.3 trillion, up from $1.3 trillion last year, according to a report released today by app measurement company App Annie. What explains the growth? More people are spending more time and -- crucially -- more money in apps. While on average people aren't downloading many more apps, App Annie expects global app usership to nearly double to 6.3 billion people in the next five years while the time spent in apps will more than double. And, it expects the...



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Promotions

NewsWare: Watch Today's Webinar!

 

We have a great guest at today's webinar!

Bill Olsen from NewsWare will be giving us a fun and lively demonstration of the advantages that real-time news provides. NewsWare is a market intelligence tool for news. In today's data driven markets, it is truly beneficial to have a tool that delivers access to the professional sources where you can obtain the facts in real time.

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Just click here at 1 pm est and join in!

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Kimble Charting Solutions

Brazil; Waterfall in prices starting? Impact U.S.?

Courtesy of Chris Kimble.

Below looks at the Brazil ETF (EWZ) over the last decade. The rally over the past year has it facing a critical level, from a Power of the Pattern perspective.

CLICK ON CHART TO ENLARGE

EWZ is facing dual resistance at (1), while in a 9-year down trend of lower highs and lower lows. The counter trend rally over the past 17-months has it testing key falling resistance. Did the counter trend reflation rally just end at dual resistance???

If EWZ b...



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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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