Tag: Wall Street

What About This Inflation Thing?

I have heard much ‘good’ news about the economy lately….but unfortunately the real facts say different….

Investors were fully expecting good news from the new monthly inflation report out Tuesday. But instead of declining, prices actually rose in August. Which means the Federal Reserve is all but certain to forge ahead with an aggressive rate hike at its Sept. 20-21 meeting. Details:

  • Monthly rise: Prices rose 0.1% in August from July, according to the Consumer Price Index, reports CNBC. Most analysts had forecast a decline of 0.1%. Investors were hoping for a sign that inflation had peaked.
  • Yearly increase: Compared to a year earlier, prices in August were up 8.3%, which is extremely high by historical standards, though below the annual figures of 8.5% in July and 9.1% in June, per the Wall Street Journal.
  • Market flips: Dow futures were up about 200 points before the report came out, with investors hoping an inflation cool-down would convince the Fed to temper its interest-rate hikes. But as soon as the report came out, Dow futures were down by 300 points, per CNBC.
  • The Fed: The new report is all but certain to keep the Fed “firmly in inflation-fighting mode,” per the New York Times. Most observers expect another hike of three-quarters of a percentage point. “Inflation is far too high, and it is too soon to say whether inflation is moving meaningfully and persistently downward,” Christopher Waller, one of the Fed’s governors, said last week. “This is a fight we cannot, and will not, walk away from.”

So the news is not so good and Wall Street reacting as could be predicted…..

The stock market fell the most since June 2020 following Wall Street’s humbling realization Tuesday that inflation is not slowing as much as hoped. The S&P 500 fell 177.72 points, or 4.3%, to 3,932.69. The Dow Jones Industrial Average fell 1,276.37 points, or 3.9%, to 31,104.97. The Nasdaq fell 632.84 points, or 5.2%, to 11,633,57. A hotter-than-expected report on inflation has traders bracing for the Federal Reserve to ultimately raise interest rates even higher than expected, with all the risks for the economy that entails. Bond prices also tumbled, sending yields sharply higher, after the government reported inflation decelerated last month by less than economists forecast.

Investments seen as the most expensive or the riskiest are the ones hardest hit by higher rates. Bitcoin tumbled 7.1%. In the stock market, all but four of the stocks in the S&P 500 fell. Technology and other high-growth companies fell more than the rest of the market because they’re seen as most at risk from higher rates, the AP reports. Apple, Microsoft, and Amazon all fell more than 4% and were the heaviest weights on the market. The communication services sector, which includes Google’s parent company and other internet and media companies, sank 4.8% for the largest loss out of the 11 sectors that make up the S&P 500 index.

Most of Wall Street came into the day thinking the Fed would hike its key short-term rate by a hefty three-quarters of a percentage point at its meeting next week. But the hope was that inflation was in the midst of quickly falling back to more normal levels after peaking in June at 9.1%. The thinking was that such a slowdown would let the Fed downshift the size of its rate hikes through the end of this year and then potentially hold steady through early 2023. Tuesday’s report dashed some of those hopes. “Right now, it’s not the journey that’s a worry so much as the destination,” says Brian Jacobsen at Allspring Global Investments. “If the Fed wants to hike and hold, the big question is at what level.”

Not to worry they will manipulate the economy to make everything look okay for us mere peasants…..but if you have to earn a living you know it is not ‘healthy’ by any stretch of the imagination.

But go ahead bury your head and plug along barely making it….or do something about it.

I Read, I Write, You Know

“lego ergo scribo”

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Closing Thought–03May21

When elected Biden was said by conservs that the markets would suffer…..but all their doom and gloom from the GOP and its spokesmen…….happily they were WRONG.

Modest gains for stocks nudged the S&P 500 and the Nasdaq to more record highs on Wall Street as investors braced for a deluge of earnings reports from big US companies. Of the 500 members of the S&P 500 index, 181 will report their results this week. Apple, Microsoft, McDonald’s, and Caterpillar are among the big-name companies that will be telling investors how they did in the first three months of the year. Ten of the 30 members of the Dow will also release their results.. The S&P 500 rose 7.45 points, or 0.2%, to 4,187.62. The Dow Jones Industrial Average fell 61.92 points, or 0.2%, to 33,981.57. The Nasdaq rose 121.97 points, or 0.9%, to 14,138.78. The Russell 2000 index of smaller companies rose 26.15 points, or 1.2% to 2,298.01

The stakes for investors are high this week, the AP reports. With millions of vaccines going out daily and trillions of dollars worth of government-led economic support being paid out, investors have turned much of their attention to how well the global economy—and corporate profits—will do in the recovery. Corporate profits in the S&P 500 are expected to be up 24% from this time a year ago, according to FactSet. Earnings growth is being welcomed by investors who have had to justify high stock values as many companies continue to emerge from a pandemic slump. About a quarter of S&P 500 companies have reported quarterly results so far this earnings season. Of these, 84% have delivered earnings that topped Wall Street’s estimates, according to FactSet.

Not to worry the CEOs are raking in the cash for themselves.

Once again the GOP has shown just how bad they lie and just how outta touch they truly have become.

I Read, I Write, You Know

“lego ergo scribo”

Bested By Amateurs

Have you heard the news?

The news where the hedge funds lost their collective butts.

A bunch of non-professional day traders pulled the veil over the big hedge funds…..all around the stock for Game Stop……

Two major players have admitted defeat in the “David and Goliath” battle over GameStop’s share price—but other Goliaths have made a fortune. The stock surged to a new high of $347.51 at the close of trading Wednesday, up almost 135% for the day, making a profit of around $2 billion for the firm’s largest three shareholders, and smaller profits for a horde of others, the Guardian reports. On Tuesday, two of the short-sellers targeted by an army of Reddit users closed their positions after taking major losses, reports CNBC. Andrew Left of Citron Research said the loss had been “100%.” Melvin Capital is believed to have lost billions on its bet that the retailer’s share price would drop, but fund manager Gabe Plotkin said rumors of a bankruptcy filing were untrue. More:

  • What happened? NBC explains how the struggling video game retailer became Wall Street’s hottest stock, rising more than 8,000% in six months. The frenzy began when amateur investors on the Reddit r/wallstreetbets community and other forums began buying stock and pushing the price up. Hedge funds that had shorted the stock—borrowing shares with the aim of profiting by selling them and rebuying them at a lower price later—were left in a squeeze when they had to rebuy the stock at a higher price, which sent the price even higher.
  • Professionals are “reeling.” The Wall Street Journal says professional investors are “reeling from their losses” as power shifts from them to day traders and newbie investors who use sites like Discord and Reddit to discuss which stock to pile into next—and to mock short sellers for their massive losses. On Wednesday alone, investors who took short positions in GameStop lost an estimated $14.3 billion.
  • White House is monitoring the situation. White House press secretary Jen Psaki said Wednesday that the White House and Federal Reserve are monitoring the situation with GameStop and other companies that have seen meteoric share price rises, reports Reuters. Fed chief Jerome Powell rejected suggestions that policies including ultra-low interest rates were the cause of asset bubbles.
  • Forum goes private. The r/wallstreetbets forum on Reddit was taken private late Wednesday and reappeared with a note from moderators saying that with a flood of new users, it was becoming impossible to enforce content policies, the Verge reports. “We have grown to the kind of size we only dreamed of in the time it takes to get a bad nights sleep,” they wrote.
  • AMC is also heating up. The nightmare for short-sellers is continuing with steep rises in the shares of struggling companies including AMC Entertainment and BlackBerry. The Wall Street Journal reports that the flurry of activity was so intense Wednesday that AMC Networks, which has no connection to the other AMC, also spiked more than 20%
  • AOC speaks out. “Gotta admit it’s really something to see Wall Streeters with a long history of treating our economy as a casino complain about a message board of posters also treating the market as a casino,” Rep. Alexandria Ocasio-Cortez tweeted Wednesday. Sen. Elizabeth Warren also weighed in, tweeting: “With stocks soaring while millions are out of work and struggling to pay bills, it’s not news that the stock market doesn’t reflect our actual economy.”
  • Where will it end? The New York Times notes that despite the hype, GameStop the company “isn’t noticeably different from a month ago,” which makes its share price appear “wildly inflated” and a risky bet indeed. The “weird little bubble” could cause the price of more solid stocks to drop if big investors have to offload them to cover their losses, according to the Times.

I love it!

The elites were beaten at their own game.

Well done!

After years of the 1% sticking it to the country they have been bested at their own game.

I think the Biden admin will either find the move illegal or they will put in massive restrictions and regulations.

Until then…let the ‘little guy’ hit back at the slugs on Wall Street.

Watch This Blog!

I Read, I Write, You Know

“lego ergo scribo”

The Economy, Stupid!

The markets have had wild swings for about a year now….but with that the profits roll on for the corporations…..the president’s lack of economic knowledge and the wild lies of something good is just making things worse.

And this past week it has come to a head (as they say)…..it happened in the bond markets……

An economic alarm bell has sounded in the US, sending warnings of a possible recession ahead—and sending the Dow plunging 800 points by the end of the day. Yields on 2-year and 10-year Treasury notes inverted early Wednesday, a market phenomenon that shows investors want more in return for short-term government bonds than for long-term bonds. It’s an indication that investors have lost faith in the soundness of the US economy, the AP reports. What appeared to be a slight thaw in trade relations between the US and China that had sent markets sharply higher Tuesday was quickly forgotten, with the Dow opening down 400 points. By 12:30pm ET it was down nearly 650 points; a half-hour later it had plunged 737 points, or 2.6%, reports CNBC. By end of day it was down 800, the S&P 500 was down 86, and the Nasdaq was down 242, per Marketwatch.

CNBC notes that bank stocks like Bank of America and Citigroup have been the big losers today, down 5% and 5.2% respectively, as “it gets tougher for [them] to make a profit lending money in such an environment.” The yield on the benchmark 10-year Treasury note hit 1.622%, falling below the yield of a 2-year, which was 1.634%. The last inversion of this part of the yield curve was in December 2005, two years before a recession brought on by the financial crisis hit. An inversion like the one taking place Wednesday has preceded the last nine recessions dating back to 1955. When a recession might hit, if it does, is a little hazier. Months or even years have passed after an inversion takes place, and before economists can connect the two. Marketwatch notes Wednesday was the Dow’s worst day this year.

Here comes the “R” word…. a “recession”…..some are running worried….

Then there are the multiple lies about China and tariffs….remember when he said China would pay for the tariffs not the American people?  That was the same lie as Mexico would pay for that damn silly border wall.  Don’t forget the lie about all the billions flowing into the coffers of the nation…that was a lie as well…..

If China was gonna to pay and the pain would all be on someone else then why did Trump decide to postpone tariffs until mid-December?

U.S. President Donald Trump on Tuesday backed off his Sept. 1 deadline for 10% tariffs on remaining Chinese imports, delaying duties on cellphones, laptops and other consumer goods, in the hopes of blunting their impact on U.S. holiday sales.

https://uk.reuters.com/article/uk-usa-trade-china-tariff/trump-backs-off-china-tariff-plan-with-delays-for-cellphones-laptops-idUKKCN1V31CR

Would “impact US holiday sales”…..that should tell you everything you need to know about these pseudo-economic solutions….even if you are not a genius like our Supreme Leader Trump.

Be Smart!

Learn Stuff!

“Lego Ergo Scribo”

 

Just How Cozy Is Hillary Clinton With Wall Street? – BillMoyers.com

You recall recently Bernie made a statement that Clinton was part of the “establishment” and the media world went batcrap crazy looking for what he really meant to say……

A manufactured issue….the rest of the country knew what he meant when he uttered the word……in case you are dense…..he meant that she was in the pocket of the special interests (you may define that in any manner you prefer)……..she is a member of that “establishment” just like hubby Bubba….I mean look at the favor he did for agri-business with NAFTA and Wall Street when he helped repel Glass-Steagall…….fast forward to today….how much does his Clinton Global thingy rake in annually….mostly from wealthy people…..who do you think that favors?

But do not take my word for it……there is much that explains her connection to the “establishment”…..

This post first appeared at Mother Jones. Hillary Clinton has received a lot of campaign money from the financial industry over the years, and after she left the State Department she gave several lucrative speeches to Goldman Sachs and other big banks. As Michael Hirsh puts it, this has given her a reputation for being “more than a little cozy” with Wall Street. But is she? Continue reading

Source: Just How Cozy Is Hillary Clinton With Wall Street? – BillMoyers.com

Vote from knowledge not from slogans and applause……this country has enough super wealthy people….what we need is someone that see to the Middle Class and our seniors…..”the poor get poorer and the rich get richer” should NO longer be a mantra to describe America.

Sen. Bernie Sanders: Man Of The People

There are not many in Washington that I would give the time of day……my two faves are Eliz.. Warren and Bernie Sanders……I have been a fan of Sanders since his days in state politics in Vermont……he has consistently been a person of the people…..there have been others that I respected their time in DC but not many…..

Sanders has always been a proponent of the poor and the middle class……he has been vocal and demanding….few in DC would listen and even fewer would have his back when it came to the nut cutting……

He and Warren are making a dynamite one two punch…….the Left is very fortunate to have these two people as their spokesperson…….Sen. Warren let the Congress have it over the latest government funding bill…..she withheld NO punches.

Remember 2008….I know it is a sore subject that few want to revisit……but to solve the problem from ever happening again there was a call to break up the big banks and eliminate the “too big too fail” syndrome where the taxpayer had to cover them for their bad business practices…….Sanders is trying again to do the right thing for the country with his 12 point plan………

Sanders detailed a 12-point economic program to,

– Invest in our crumbling infrastructure with a major program to create jobs by rebuilding roads, bridges, water systems, waste water plants, airports, railroads and schools.

– Transform energy systems away from fossil fuels to create jobs while beginning to reverse global warming and make the planet habitable for future generations.

– Develop new economic models to support workers in the United States instead of giving tax breaks to corporations which ship jobs to low-wage countries overseas.

– Make it easier for workers to join unions and bargain for higher wages and benefits.

– Raise the federal minimum wage from $7.25 an hour so no one who works 40 hours a week will live in poverty.

– Provide equal pay for women workers who now make 78 percent of what male counterparts make.

– Reform trade policies that have shuttered more than 60,000 factories and cost more than 4.9 million decent-paying manufacturing jobs.

– Make college affordable and provide affordable child care to restore America’s competitive edge compared to other nations.

– Break up big banks. The six largest banks now have assets equivalent to 61 percent of our gross domestic product, over $9.8 trillion. They underwrite more than half the mortgages in the country and issue more than two-thirds of all credit cards.

– Join the rest of the industrialized world with a Medicare-for-all health care system that provides better care at less cost.

– Expand Social Security, Medicare, Medicaid and nutrition programs.

– Reform the tax code based on wage earners’ ability to pay and eliminate loopholes that let profitable corporations stash profits overseas and pay no U.S. federal income taxes.

I have NO problem with his plan…..which is unusual for I seldom find a plan coming out of the Senate that I agree with…….Americans need to get informed and back Sanders plan…….another 2008 is only a tick away from happening again…….

Because of the collective ignorance of the American people will ensure that we will face another economic crash…..and this one may not be as easy to repair as the last…….

Keep your head in the sand and you will make it possible for more suffering of the American people……I know most could care less about their fellow Americans and that is why we are doomed to keep making the same mistake time and time again……..

McKinsey Article Lays Out How to Rethink Capitalism – US News

American capitalism is killing the American Dream…..it is crapping all over those who actually have to work…..call me anything you like….communist, socialist, anarchist….I do not much care as long as you pull your head out of your butt and take a good look at the damage capitalism is doing to the average American family.

Capitalism can work but it needs re-doing……..a task few are unwilling to sow the guts to even consider much less attempt……

 

McKinsey Article Lays Out How to Rethink Capitalism – US News.

While We Were Asleep

The other day while most of America was sleeping from another of trying to earn a living….the police departments in several cities were attacking the Occupy movement to evict the people that were protesting…..we all, at least those of us that were interested, have seen all the vids and photos of what happened on that early morning raids……but while we were asleep and police were doing the dirty work of the government…..another issue was playing out under the radar thanks to the raids…..

Have I peaked your curiosity?

Congress is the culprit I speak of and here is what they are attempting to do……

We Love Bailouts Bill: HR 1838 (Stivers) would repeal a section of the Dodd-Frank Act that prohibits the Federal Government from bailing out big Wall Street derivatives dealers. What are they thinking? With Merrill Lynch right now attempting to transfer a total of $75 trillion in derivatives bets from its investment arm into Bank of America, its FDIC-insured parent company, why is the GOP eager to facilitate the next giant taxpayer bailout?

Dark Markets are Good for You Bill: HR 2586 (Garrett) would allow big Wall Street derivatives dealers to continue opaque bilateral trading and allow them to avoid price transparency required by the Dodd-Frank bill. Off-book gambling in the derivatives market was a key cause of the 2008 financial crisis, and Dodd-Frank made huge steps forward, requiring the vast majority of derivatives to be traded in open forums where everyone could see what is going on in this $600 trillion dollar market. Similarly, HR 2779 (Stivers) would exempt all transactions between related affiliates from derivatives regulations, creating less, not more, transparency.

Swap Till You Drop Bill for Pension Funds: HR 3045 (Canseco) would permit swaps dealers to get a blanket exemption from any duty to respect the best interests of pension funds when giving any advice on a swaps deal. Just last week, we saw the largest municipal bankruptcy in United States history, in Jefferson County, Alabama, which was caused when JP Morgan Chase bribed local officials into entering a swaps deal to refinance a sewage district.

Go Back to Sleep SEC Bill: HR 2308 (Garrett) would create a series of new hurdles for the Securities Exchange Commission (SEC) to jump before the institution can pass a new rule or regulation. SEC is not my favorite regulator and their fines on the big Wall Street banks have not been commensurate with the crimes, but compared to the U.S. Justice Department, SEC regulators have been veritable energizer bunnies, extracting billions in concessions.

AS promised, the Repubs are trying to gut the Frank-Dodd Financial Reform Act…….and as usual they are doing the dirty work for those they really work for….Wall Street and the Banks…….

People!  The time has come for us to demand more from our government…….and these moves are no where in the best interests of the average American……speaks volumes on who really runs this government and YOU allowed it to happen…..