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US Economic Data Has Never Been This Weak For This Long
Despite the ongoing propaganda reinforcing America's "cleanest sheets in a brothel" economic growth, the fact is, there is a reason why The Fed folded, why Draghi doubled-down, why China cut, and why Kuroda will likely unleash moar QQE this week. It appears the 'trap' that central planners have set for themselves - by enabling massive financial asset inflation in the face of what is now the longest streak of economic weakness and data disappointment on record - now looks set to prove their impotence and/or Enisteinian insanity.
As Ice Farm Capital notes,
a year ago were looking at 5yr inflation breakevens around 1.5%. They have since deteriorated to 1.15% (by way of 1%) and this week we are expecting a Q3 GDP print more like 1.5% -- a deceleration of a full 240bps.
Corporate profit margins have taken a sharp hit and corporate profits for the S&P are now down 3% yoy despite continued share buybacks.
Through this entire period, markets have continually expected happy days to be just around the corner.
As a result, we have seen economic surprises for the US negative for the longest stretch in the history of the data series:
2015 has been weak from the start
To make it a little clearer, this period of economic weakness and disappointment is not just the longest on record, but it is entirely unprecedented...
Hike rates into that!! (Is it any wonder, the market's odds of a Dec rate hike remain at 34%, despite all the talk from The Sell-Side and The Fed that it is a live meeting)
Charts: Bloomberg and Ice Farm Capital
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Does economic data matter as long as the Fed is buying and levitating the stock market?
Ex-Plunge Protection Team Whistleblower: "Governments Control Markets; There Is No Price Discovery Anymore"http://www.zerohedge.com/news/2015-02-23/ex-plunge-protection-team-whist...
Burn that mf to the ground.
Bullshit.
It has been.
We called it 2007 but the RNC propaganda machine on CNBS refused to say it was a finanical crisis or recession until one of their pet monkeys (Lehman) went Tits Up.
This is another process where denial and bullcrap will fly for about 12-18 months then the shit hits the fan.
Hear that motor?
Listen to that fan blade....
INCOMING!
Sorry but you left out the RNC and DNC monkeys.
BOTH are bought out and corrupt.
Yep. "US Economic Data Has Never Been This Weak For This Long" all because USA defaulted when H Paulson started the bailouts and BHO put it all on steroids ever since ! USSA is toast and the world knows it.
I suggest all you fat asses get your shit together ASAP or be brutalized ! Your choice :)
Never thought I'd see ZH admit the Fed was right.
I would guess they are pointing to the insanity of ZIRP. Not inanity if you want a 1790-92 French Revolution.
So with all the printing...when is Gold going to move up.
Gold moves up after it is outlawed to own and about a year later.
Yellen is superman, Tyler durden is lex Luther and gold is kryptonite. So far yellen keeps winning
I wonder about that every day for the last 8 years.... that's 5 iphone versions ago...
you know... they where the same as today but the sides where more round and the covers where made of a strong plastic... and not every 5 year old kid had one...
Let's just hope it doesn't happen before we all get to old to enjoy it.
we are in for a very long inexorable decline.
As they said in the wizard of Oz, after the huricane, THE HOUSE CRASHES TO THE GROUND AND THE WITCH DIES!
It was fun elevator ride up. I can't wait to see how all those fat cat, tank assed, useless eaters, get their piles of paper down from the top of a financial Matterhorn.
Hasn't that been happening for a while? Before the crisis the US had 25% of global GDP. In 2014 it was 16% something nearly on a par with China.
After WWII, US had close to 10% of global population and now 4.4% - and that should not matter? While there is obviously some shift and decline in the living standard of the US population it is still 4 times as high as China's, because they have 4 times as much in population. Measured on population, China has only half as many soldiers as the US. China has 4 times the population but only twice as many soldiers. (Of course round figuers and official figures, grey areas like secret services are obviously not included)
Dear Donald is not doing the US any favours when he says that 'we should have just taken the oil in Iraq". This points to him wanting a new war and people might withdraw money from the US when they have to fear it might be spent on unproductive military adventures and thus evaporate.
Watchlist: Russia is due 3 billion in early December and the Ukraine cannot pay. Has Congress provided for that in the budget? The EU is getting bankrupt from refugee costs, so there's not much to be expected from there. But maybe they can do a deal in the Syria negotiations??? Russia is not insisting on those 3 billion which would put Ukraine in default and in return ............
What this article doesn't cover is the fact that a rate hike is totally impossible untill the new debt ceiling is approved.
On the down side... national parks will be closed yet again and tourist won't be able to visit the landmarks untill the paperwork is done.
On the plus side... strip joints, bars, brothels and all the other new economic important parts of the economy will florish now that those civil servants get a week off pretty soon!
“The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in a democratic society” Edward Bernays.
WTF! Thanks to the criminal bankers and Wall Street, everyone is now expecting to get rich in a matter of months. It took about ONE-HUNDRED f***ing years of Fed-induced inflation for the Dow to go from 100 to 14k. One-hundred years of the most incredible growth in human history, and there was a depression and two or three large recessions along the way. Therefore, it should likely take another 100 years for the Dow to double again to 28,000! But the oligarchs are so f***ing greedy, they want to use TRILLIONS of $$ in debt to try to push the Dow to 28k in MONTHS. The worthless buying power of the dollar isn’t even a consideration, just push markets higher. Inflate housing, the idiots will feel rich and borrow cheap $$ and spend them on more useless crap made in China. The masses have been brainwashed into cheering the insanity on…they no longer need God; they have the omnipotent central bankers to worship. The oligarchs want more immigration since it means more borrowers and customers. Then they laugh at the lemmings sitting in massive traffic jams of their own making, as they cruise overhead in their helicopters.
The bankers will never give up on QE as the politicians will not tolerate ANY downturns and always demand intervention. Business cycles are not to be allowed any more in order to prevent social unrest.
The great unwinding will happen anyway and send millions more illegal immigrants streaming into Europe and the USA to hasten the final collapse. The markets no longer reflect future “earnings” expectations, only stock buybacks, layoffs and the promise of ever more QE. This is insanity and has to end ugly...
Didn't you get the memo, MOAR bad news = GOOD
bullish
I mentioned awhile back that some fairly bright associates told me to watch Corporate earnings.
Thus far they've (.Gov, The 500 and Fed) have been successful at massaging numbers, ( I did not say they were believable)
but it appears that's coming to an end. I'm convinced they have another plan to prevent catastrophy, but there's absolutely no way of telling to what lengths they may go.
So,
A. Do Corporates borrow more cheap money and continue buybacks?
B. Announce substantial layoffs
C. Coordinate and institute a program of massive equity purchases?
D. All of the above
Feel free to expound