Gross Domestic Product
Futures Jump After Bill Dudley Hints At Fed "Policy Error", Warns Of "Significant Consequences" From Strong DollarSubmitted by Tyler Durden on 02/03/2016 09:37 -0500
"A weakening of the global economy accompanied by further appreciation in an already strong dollar could also have "significant consequences." I read that as saying we're acknowledging that things have happened in financial markets and in the flow of the economic data that may be in the process of altering the outlook for growth and the risk to the outlook for growth going forward."
- Bill Dudley
"Cash had a pretty good run for 4,000 years or so. These days, though, notes and coins increasingly seem declasse: They're dirty and dangerous, unwieldy and expensive, antiquated and so very analog.... Much depends on the details, of course. But this is a welcome trend. In theory, digital legal tender could combine the inventiveness of private virtual currencies with the stability of a government mint."
Having urged "don't panic" just 4 short months ago, it appears Nigeria just did just that as the global dollar short squeeze forces the eight-month-old government of President Muhammadu Buhari to beg The World Bank and African Development Bank for $3.5bn in emergency loans to help fund a $15bn deficit in a budget heavy on public spending amid collapsing oil revenues. Just as we warned in December, the dollar shortage has arrived, perhaps now is time to panic after all.
"Never before have so many central banks explored sub-zero territory at the same time."
“The global inequality crisis is reaching new extremes. The richest 1% now have more wealth than the rest of the world combined. Power and privilege is being used to skew the economic system to increase the gap between the richest and the rest," Oxfam asserts, adding that "the current system did not come about by accident, humanity can do better than this."
While prices in China's Tier 1 cities are soaring, let's put the country's vacant housing problem in context: China has some 13 million homes vacant - enough to house the families of several small countries . Actually, it's worse: Zhu Min, deputy managing director at the International Monetary Fund, recently admitted that China’s real estate bubble now manifests itself in 10. 7 billion square feet (1 billion square meters) of unused housing! Min added that many housing stock go unused, and the market may see a significant price correction in the future, wiping out vast household wealth.
With the lifting of Iran sanctions, the Tenge has crashed5% to record lows at 377/USD (extending the currencies collapse since the USD-peg was scrapped in August). Furthermore, oil production is entering a new year of decline this year in Kazakhstan - a dismal omen for a country so heavily reliant on energy exports.
by a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens
President Barack Obama’s final State of the Union address came up short of the facts on several topics. Obama apparently omitted part of his presidency in boasting of nearly 900,000 manufacturing jobs “in the past six years.” Over his entire time in office, manufacturing jobs have gone down by 230,000.
"Oil goes below $40, it’s frightening for geopolitical behavior. Guess what, folks? It’s below $40 and this frightening political behavior is upon us.... We could be looking at a really ugly situation during the first quarter of 2016... I think we're going to take out the September low of the S&P500."
On Tuesday we get the latest tragedy out of Turkey as at least 10 are dead in a suicide attack on Istanbul. The explosion rocked Sultanahmet Square outside the city’s Blue Mosque injuring 15 in addition to those killed.
In principle, the BRRD, or “bail-in directive” as it is also known, is quite a good idea. The fact that lending money to fractionally reserved banks or even merely depositing it with them, involves risks needed to be firmly reestablished. One simply cannot expect that banks and their creditors will be bailed out by taxpayers at every opportunity. Besides, the admission that there are risks in banking that have hitherto been glossed over or have even been lied about was long overdue. However, Europe’s governments are now likely to find out that the current monetary system with its fractionally reserved banks is actually incompatible with this admission, so to speak.
Byron Wien's Reveals Top 10 Predictions: Expects Stocks To Decline After Predicting 15% Rise In 2015Submitted by Tyler Durden on 01/04/2016 12:53 -0500
"The United States equity market has a down year. Stocks suffer from weak earnings, margin pressure (higher wages and no pricing power) and a price- earnings ratio contraction. Investors keeping large cash balances because of global instability is another reason for the disappointing performance."
"Core" Durables Goods Orders Plunge For 10th Consecutive Month As Defense Spending Soars Most In 8 YearsSubmitted by Tyler Durden on 12/23/2015 08:55 -0500
If it wasn't for America's war machine, the economy would be deep in recession. Defense spending (aircraft and parts) soared 148% in the last 3 months - biggest such rise since 2007 managing to squeeze Durable Goods Orders overall to unchanged in Nov (vs -0.6% exp). That's the good news. Everywhere else you look bad. Core Capex fell 1.93% YoY - the 10th consecutive YoY drop - something not seen before outside of recession.