Archive for May, 2019

Nearly One-Quarter Of Americans Worry About Money ‘All Of The Time’

Courtesy of ZeroHedge. View original post here.

It’s a question that the financial press – not to mention millions of struggling Americans – have returned to time and time again (recently, it even received its own Vox explainer): If we are truly in the middle of an economic boom, then how come so many Americans, even members of the vaunted middle class, feel like they’re barely treading water?

According to the Fed, roughly 40% of Americans couldn’t cover an emergency $400 expense. Wage growth has been stagnant for decades. Meanwhile, our monetary policy makers point to a lack of inflation in the economy as an excuse for keeping interest rates on hold, even as the man on the street, and even a growing number of economists, contend that prices have been climbing much more quickly than the official data let on.

And we’re not just talking about the obvious factors like rising tuition, rent and health-care costs. It increasingly appears that the central bank is underestimating food inflation, even as the prices of many agricultural commodities remain in a slump (of course, Trump’s trade war isn’t helping).

To the growing list of distressing data points, we can now add one more: Gallup has published a poll showing that roughly 45% of Americans would rate their financial situation as “fair” or “poor” – and that a staggering 70% expected they would be financially better off. And while two-thirds of Americans say they have enough money to live comfortably, another one-third do not. But even more concerning is the 25% of respondents who say they’re constantly worried about not having enough money to cover their household expenses. Roughly the same number said they’re only just making ends meet.

In a ranking of Americans’ financial anxieties, the overwhelming majority of respondents said they’re at least a little worried about being able to afford health care costs and having enough money for retirement.

Health Care

Gallup synthesizes the polling data into what it calls a “Personal Financial Worry” index. This year, 22% of respondents said they were worried about six or seven of the seven items, qualifying them for the “highly worried” category. Another 24% worry about three to five items and are classified as “moderately worried.” The remaining 55% said they have few financial worries, while 30%
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Trade Wars: A Real-Life Game Of Thrones

Courtesy of Bruce Yandle via The American Institute for Economic Research

It’s ironic, to say the least, that the Chinese government chose to deny a national broadcast of “Game of Thrones”’ last installment recently, signaling to both its own people and to the United States that the ongoing trade war is far from over.

After all, Mr. Trump’s much cherished trade wars are a game where one powerful leader confronts another – a game of thrones, so to speak, where skirmishes and battles occur and the innocent become victims in an inescapable field of combat.

Unlike marvelously created made-for-television episodes where someone usually emerges victorious, in trade wars, everyone loses.

Those Chinese who looked forward to seeing the final episode may have instead seen some of the last few weeks’ televised propaganda and concluded that the United States is not to be trusted. At the same time, Americans – Kansas grain farmers who previously shipped crops to China; South Carolina auto workers who built China-bound BMWs, Volvos, and Hondas; or ordinary U.S. Walmart shoppers paying slightly higher prices – are not doing quite as well as they were before Mr. Trump’s game of thrones started.

Of course, we’ve all heard the justifications: China has not played by the rules, its enforcement of intellectual property rights leaves much to be desired, and its government-owned enterprises are subsidized unfairly. But we must also recognize that the “victimized” American businesses who still chose to do business in China did so voluntarily. In spite of its well-known imperfections, they saw China’s marketplace as attractive and profitable.

Of course, it would be great if we could compel China to improve its practices without subjecting American workers and consumers to friendly fire. And we might all wish to call Camelot home. The situation is much like when a landowner buys a fine home at a discount next to an industrial plant and then brings suit to force a clean-up. One cannot voluntarily come to the nuisance and then expect a court of law to provide a windfall. But it doesn’t hurt to try.

Those who think that the ongoing trade wars with China and other countries are making America great should look closely at what is happening to U.S. industrial production, which has fallen for three…
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As Quant Funds Shutter, Stevie Cohen Doubles Down

Courtesy of ZeroHedge. View original post here.

It’s not just humans who have no idea how to trade this market: math PhD’s are just as clueless, and as a result quants are having a deja vu of December when they suffered jarring losses in a short period of time, just like their human peers.

For evidence, look no further than HBK Capital Management, which is closing its quant unit, adding to the recent pile up of hedge funds that wagered on algorithmic trading… poorly.

According to Bloomberg, the Dallas-based firm which manages a total of $8 billion, is liquidating a more than $400 million quant fund and returning capital to investors, based on a statement Friday. HBK is also cutting its allocation to a statistical arb fund. The quant strategy was one of seven that HBK employed, alongside corporate credit, emerging markets, event-driven equities, structured credit, developed markets fixed income and volatility.

“HBK’s decision was prompted by a reevaluation of its equity statistical arbitrage effort, which performed exceptionally well through 2014 but less well in recent periods,” according to the statement from the $10 billion firm. “Although recent performance compared favorably with many similar funds, it did not meet HBK’s return objectives.”

HBK is the latest fund to fall amid hard times, struggling to make money amid bouts of market volatility. Investors yanked $8 billion from quant funds in the first four months of this year, according to data from eVestment. That’s on top of the $19 billion they pulled in 2018.

Even iconic investors such as billionaire Cliff Asness who manages one of the world’s largest funds, has faced losses and redemptions, admitting earlier this month that quant stock selection has been “terrible.” Amplitude Capital, which lost money for two straight years and saw investor withdrawals, is returning outside money. And BlueMountain Capital Management is liquidating its $1 billion computer-driven portfolio and refocusing on human-run investing.

One of the main reasons for the quant underperformance: the nature of stock gyrations. As Bloomberg explained, risk appetite and economic growth expectations haven’t been strong enough to help revive a factor like value, which tends to be made up of cheaper and thus riskier equities. Others, like quality and low-volatility, have looked out of tune with the new year rally, even after they became expensive thanks to their haven appeal in late 2018.

Even the momentum factor,…
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Saudi King Urges Global Coalition To ”Use All Means To Stop Iran” At Emergency Summit

Courtesy of ZeroHedge. View original post here.

Perhaps sensing that the US “maximum pressure” campaign against Iran is fast deflating, with even ultra-Hawk John Bolton late this week saying American military build-up had successfully “deterred” imminent Iran threats – suggesting the crisis has been averted – the Saudis are now going on the offensive

Image source: AP via Al Jazeera

Saudi Arabia’s aging King Salman went on an anti-Iran tirade during an emergency meeting of Arab leaders hosted in Mecca on Thursday, saying the Shia country is the greatest threat to global security for the past four decades. He also echoed past US and Israeli charges that Tehran is currently developing nuclear and ballistic missiles in order to threaten its neighbors and extend its influence over the region. 

He said Iran’s leaders were “harboring global and regional terrorist entities and threatening international waterways.” He called for “using all means to stop the Iranian regime” from its regional “interference”. Iran for its part rejected these as “baseless accusations” and has denied it had any role in a spate of recent “sabotage” attacks in the Gulf region. 

The king further condemned Iran’s tactics to disrupt maritime trade and global oil supplies in “glaring violation of UN treaties” following Riyadh’s blaming Iranian operatives for using underwater mines to attack and “sabotage” four tankers near the Strait of Hormuz weeks ago, two of which were Saudi flagged. 

The Iranian regime has been interfering in other countries’ affairs, developing their nuclear programs and threatening international navigation,” King Salman said during his speech, according to a translation by Saudi-owned Al-Arabiya.

Iran has been “supporting terrorism, undermining stability, and looking to expand its influence over the past four decades,” Saudi Arabia’s King Salman said at the GCC Summit in #Mecca. https://t.co/8TMXsarPPK pic.twitter.com/GdQ20I64r2

— Al Arabiya English (@AlArabiya_Eng) May 30, 2019

The Saudis are attempting to build a strong consensus of Arab states which will stand aggressively against Iran and its allies in the region; however, these efforts could be crippled by the ongoing inter-GCC economic and diplomatic war involving Qatar. 

The US welcomed the move toward “Arab unity” to confront Iran, with a State Department spokesperson saying Thursday, “Gulf unity is essential in confronting Iran, to confronting their influence, to countering terrorism writ…
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“Largest Foreign Bribery Case In History” Claims New Scalp: Former Pemex CEO

Courtesy of ZeroHedge. View original post here.

Authored by Don Quijones via WolfStreet.com,

His lawyer suggests if the price is too high, he may be willing to take his friend, former president of Mexico, down with him…

Emilio Lozoya, a former chief executive of state oil company Petróleos Mexicanos (Pemex), was issued with an arrest warrant on Wednesday for financial irregularities, in particular his alleged dealings with scandal-plagued Brazilian construction firm Odebrecht.

Lozoya, formerly a one-time senior election campaign advisor to Mexico’s current president, Enrique Peña Nieto, is accused of receiving “tips” from Odebrecht worth some $10 million in exchange for his support in obtaining public work contracts. The money allegedly passed through shell companies in the British Virgin Islands before coming to rest in private bank accounts belonging to Lozoya in Switzerland, Liechtenstein, and Monaco.

Lozoya is one of countless public figures and business leaders in over a dozen Latin American and African countries, including Venezuela, Colombia, Argentina, Peru, Angola and Mozambique, to be accused of having his pockets lined by Brazil’s largest construction company. Some of those figures have even ended up in jail, including the former CEO of Odebrecht, Marcelo Odebrecht, and former Brazil president Luiz Inacio Lula da Silva, who is accused of accepting money from Odebrecht for his family’s vacation home.

The scandal has done extensive damage to Brazil’s state-owned oil behemoth Petrobras and has so far cost Odebrecht $2.6 billion in fines, $2.39 billion of which went to Brazil, $93 million to the U.S. and $116 million to Switzerland.

But in Mexico the investigation into Lozoya’s alleged acceptance of financial inducements seemed to be going nowhere — perhaps no surprise given the former attorney general, Raúl Cervantes Andrade, is a very close friend of President Peña Nieto, who is in turn a very close friend of Lozoya’s. But now that Mexico has a new government and a new attorney general that have pledged to combat corruption at Pemex, that friendship may be about to be seriously tested as Lozoya threatens to drag Peña Nieto with him through the dirt.

“Nothing in this country moved unless there were instructions from the president,” Lozoya’s lawyer, Javier Coello said on Wednesday, adding that the ministries of finance, economy and energy all had seats on the company’s board.

Lozoya was CEO of Pemex from 2012 to 2016, during which time…
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How soybeans became China’s most powerful weapon in Trump’s trade war

 

How soybeans became China's most powerful weapon in Trump's trade war

Courtesy of Ian Sheldon, The Ohio State University

Soybeans may not seem all that useful in a war. Nonetheless they’ve become China’s most important weapon in its ever-worsening trade conflict with the U.S.

China, the world’s biggest buyer of the crop, has reportedly stopped purchasing any American soybeans in retaliation for the Trump administration raising tariffs on US$250 billion of Chinese goods. This is very bad news for U.S. farmers.

While China’s targeting of soybeans may have come as something of a surprise to most Americans, to a professor of agricultural economics who studies international commodity markets for a living, this was not at all unexpected.

Even before the conclusion of the 2016 presidential race, trade analysts were already weighing the possibility that China might impose an embargo on U.S. soybean imports based on protectionist rhetoric from both candidates.

As a result, with the trade war in full swing, American soybean farmers are now among its biggest losers. Here are a few figures that show why.

Soybeans, by the numbers

Soybeans are a crucial part of the global food chain, particularly as a source of protein in the production of hogs and poultry.

The importance of China as a market for soybeans has been driven by an explosion in demand for meat as consumers switch from a diet dominated by rice to one where pork, poultry and beef play an important part. Chinese production of meat from those three animals surged 250% from 1986 to 2012 and is projected to increase another 30% by the end of the current decade. However, China is unable to produce enough animal feed itself, hence the need to import soybeans from the United States and Brazil.

In 2017, the U.S. accounted for $21.4 billion worth of global soybean exports, the second largest after its main competitor Brazil, which exported $25.7 billion.

Meanwhile, in 2017 China accounted for the lion’s share of global soybean imports at $39.6 billion, or two-thirds of the total.


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MacKenzie Bezos’ $17 billion pledge tops a growing list of women giving big

 

MacKenzie Bezos' $17 billion pledge tops a growing list of women giving big

Courtesy of Elizabeth J. Dale, Seattle University

Shortly after her divorce from Amazon founder Jeff Bezos became final, MacKenzie Bezos promised to give at least half of her assets away.

By divorcing the world’s richest person, the novelist and former accountant became the third-richest woman in the world and the wealthiest woman to sign onto the Giving Pledge, a commitment to give away the bulk of big fortunes.

“I have a disproportionate amount of money to share,” she declared. “I will keep at it until the safe is empty.”

MacKenzie Bezos’ commitment to give away at least half of her wealth, about US$17 billion in today’s dollars, marks her as more generous than her ex-husband.

Jeff Bezos has not yet signed the pledge. And he never signaled much interest in giving away billions until the couple jointly made public their plans to donate $2 billion to help the homeless and fund a network of preschools in 2018.

MacKenzie Bezos is the most visible emblem to date of an important philanthropic trend. As a scholar of giving by and for women, I’ve studied how high-net-worth female donors are taking the reins of their family’s giving and, in many cases, charting their own course through philanthropy. Until recently, most have kept their profiles relatively low.

Giving while female

Some of today’s biggest female givers still tend to be overshadowed by their corporate-leader husbands. Although the Bill and Melinda Gates Foundation has always promoted its work as the couple’s joint effort, it wasn’t until Melinda Gates published her 2019 book about her leadership role that her personal efforts to empower and educate women and girls worldwide gained prominence.

Similarly, Priscilla Chan, the physician married to Facebook founder Mark Zuckerberg, is the one running the couple’s Chan Zuckerberg Initiative. They founded their limited liability corporation in…
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I’m an MLK scholar – and I’ll never be able to view King in the same light

 

I'm an MLK scholar – and I'll never be able to view King in the same light

According to FBI memos, King witnessed and encouraged a rape in a hotel room. AP Photo

Courtesy of Jason Miller, North Carolina State University

David Garrow, the Pulitzer Prize-winning biographer of Martin Luther King Jr., has unearthed information that may forever change King’s legacy.

In an 8,000-word article published in the British periodical Standpoint Magazine on May 30, Garrow details the contents of FBI memos he discovered after spending weeks sifting through more than 54,000 documents located on the National Archive’s website. Initially sealed by court order until 2027, the documents ended up being made available in recent months through the President John F. Kennedy Assassination Records Collection Act of 1992.

The most damaging memos describe King witnessing a rape in a hotel room. Instead of stopping it, handwritten notes in the file say he encouraged the attacker to continue.

King was once thought of as a saint beyond reproach. After his death, it eventually emerged that he was a womanizer.

If these FBI memos are accurate – and I have good reason to believe they are – we now have to ask the unthinkable: Was King an abuser? And what might this mean for his legacy?

Other outlets balk

The FBI files contained some other notable information.

Garrow writes that King may have fathered a daughter with Dolores Evans, a girlfriend of his who is still alive and living in Los Angeles. The memos also detail the closeness of his relationship with Dorothy Cotton, a longtime associate of King’s in Atlanta and director of his organization’s Citizen Education Program. It appears that the two were romantically involved.

Many of these transcripts were based on audiotapes that are still sealed under a court order.

Garrow had taken his findings to other outlets, but each decided against publishing them. The Guardian initially agreed to take the story, edited the piece, paid Garrow for his work and then decided the story was too risky to run. Editors at the Atlanta Journal-Constitution …
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Why The Creator Of The Bond Volatility Index Believes “This Will End In Tears”

Courtesy of ZeroHedge. View original post here.

The legendary creator of the MOVE bond volatility index and the iconic Merrill Lynch RateLab, Harley Bassman, has opined on the biggest inversion in the yield curve since the financial crisis (3M-10Y dipped as low as -22.5bps this morning), and his view is hardly favorable.

As Bassman notes in his latest note "Can you hear me Knocking", he reminds his readers that in his February 6, 2019 commentary titled "Wall Street Jenga", he noted that "December’s initial Yield Curve inversion flashed a signal for a market or economic disruption in Q2-2020 (Eighteen months ahead)." Fast forward to today when he cautions that "this week, these two rates finally inverted." And in response to those "best and brightest who are bleating how "it is different this time", Bassman has a one-word answer: "Puff!"

But before being accused of becoming the "next headline seeking pundit calling for a crash" he explains that he is "just saying that important risk vectors are now in disequilibrium, and these cannot be excused by QE, Trump, or the proximity of MMT."

Additionally unlike skeptics who believe they know the next surprise will germinate; Bassman declines such as task as "such is the definition of a surprise.That said, well-heeled investment professionals are effectively willing to purchase five-year bonds to be issued in 2024 (five years hence) at a rate below today’s risk-free overnight rate."

This, as he further notes, is "different than a low print on the VIX, which is a derivative of a derivative; these are two of the most heavily trafficked interest rates in the unfettered US Dollar market."

As such, he adds, "unless this was a ‘quick kiss’ during the holiday shortened Hamptons summer kick-off, I am starting to prepare for a macro-political or -economic disturbance."

In short, one of the most respected men in financial analysis is bracing for chaos.

So what is he doing?

First, he urges readers "let's keep out heads clear, it is not time to panic." That said…

I am not explicitly reducing risk exposure, per se, rather I am adjusting the manner in which I touch it. I am covering (embedded) out-of-the-money option shorts and seeking ways to be long convexity–unbalanced risk in


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Phil's Favorites

Directors are in the crosshairs of corporate climate litigation

 

Directors are in the crosshairs of corporate climate litigation

Melting glaciers threaten the village of Huaraz, Peru. Uwebart/Wikimedia, CC BY-SA

Courtesy of Lisa Benjamin, Dalhousie University

The directors of RWE, a German energy company, had probably never heard of the small village of Huaraz, Peru before 2015. But Saúl Lliuya, a mountain guide and farmer there, sued RWE for climate-related harms that year.

Lliuya&rs...



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Zero Hedge

Manufacturing Employment Expectations Crash Despite Empire Fed Survey Rebound

Courtesy of ZeroHedge. View original post here.

After June's plunge in regional Fed business surveys, July's Empire Fed headline printed a better-than-expected +4.3 (exp +2.0) from -8.6 in June.

However, despite the pickup in the main index, details of the report show that the industry continues to struggle.

A gauge of current orders crept up, though more of the state’s factories said bookings were lower in July than higher.

And, both current and future expectations for employment tumbled, with th...



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Kimble Charting Solutions

Silver/Gold Ratio Making A Bullish Reversal?

Courtesy of Chris Kimble.

Silver (NYSEARCA: SLV) is an important cog in the precious metals world. Not only is it a core precious metal but it is often a leading indicator for metals bulls.

Silver is a good risk-on / risk-off indicator. When it is out-performing Gold, it is risk-on. When it is under-performing, it is risk-off. It’s been the latter for the better part of the past 8 years.

And when the trend remains down, which historically means that metals rallies will be sold.

The Silve...



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Insider Scoop

Earnings Scheduled For July 15, 2019

Courtesy of Benzinga.

Companies Reporting Before The Bell
  • Citigroup Inc. (NYSE: C) is estimated to report quarterly earnings at $1.81 per share on revenue of $18.49 billion.
  • ShiftPixy, Inc. (NASDAQ: PIXY) is projected to report quarterly loss at $0.08 per share on revenue of $14.39 million.
  • Eros International Plc (NYSE: ...


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Digital Currencies

Bitcoin Breaks Back Below $10k, Crypto-Crash Accelerates As Asia Opens

Courtesy of ZeroHedge. View original post here.

Update 2010ET: Having briefly stabilized after this morning's weakness, cryptos are tumbling once again as Asian markets open.

Bitcoin has broken below $10,000 again...

*  *  *

While all eyes are on Bitcoin as it slides back towards $10,000, the real mover in the last 12 hours has been Ethereum after...



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Biotech

DNA testing companies offer telomere testing - but what does it tell you about aging and disease risk?

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

 

DNA testing companies offer telomere testing – but what does it tell you about aging and disease risk?

A telomere age test kit from Telomere Diagnostics Inc. and saliva. collection kit from 23andMe. Anna Hoychuk/Shutterstock.com

Courtesy of Patricia Opresko, University of Pittsburgh and Elise Fouquerel, ...



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ValueWalk

Professor Shubha Ghosh On The Current State Of Gene Editing

 

Professor Shubha Ghosh On The Current State Of Gene Editing

Courtesy of Jacob Wolinsky, ValueWalk

ValueWalk’s Q&A session with Professor Shubha Ghosh, a professor of law and the director of the Syracuse Intellectual Property Law Institute. In this interview, Professor Ghosh discusses his background, the Human Genome Project, the current state of gene editing, 3D printing for organ operations, and gene editing regulation.

...

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Chart School

Gold Gann Angle Update

Courtesy of Read the Ticker.

Charts show us the golden brick road to high prices.

GLD Gann Angle has been working since 2016. Higher prices are expected. Who would say anything different, and why and how?

Click for popup. Clear your browser cache if image is not showing.



The GLD very wide channel shows us the way.
- Conservative: Tag the 10 year rally starting in 2001 to 2019 and it forecasts $750 GLD (or $7500 USD Gold Futures) in 10 years.
- Aggressive: Tag the 5 year rally starting in 1976 to 2019  and it forecasts $750 GLD (or $7500 USD Gold Futures) in 5 years.

Click for popup. Clear your browser cache if ima...



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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Mapping The Market

It's Not Capitalism, it's Crony Capitalism

A good start from :

It's Not Capitalism, it's Crony Capitalism

Excerpt:

The threat to America is this: we have abandoned our core philosophy. Our first principle of this nation as a meritocracy, a free-market economy, where competition drives economic decision-making. In its place, we have allowed a malignancy to fester, a virulent pus-filled bastardized form of economics so corrosive in nature, so dangerously pestilent, that it presents an extinction-level threat to America – both the actual nation and the “idea” of America.

This all-encompassing mutant corruption saps men’s souls, crushes opportunities, and destroys economic mobility. Its a Smash & Grab system of ill-gotten re...



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OpTrader

Swing trading portfolio - week of September 11th, 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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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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