investmentwatchblog--2020-11-18--Presidents Come and Go. The Fed’s Power Grows

Americans anxiously wait for the final outcome of this election , the Federal Reserve continues on its immovable course towards nationalization of the means of production .
Ironically , we vote for a president who has limited power , but a hand on the nuke button ; whereas , we don ’ t vote for the Fed chair , who has nearly unlimited power , and a hand on the economic equivalent to the nuke button ; the ability to conjure money out of thin air .
As for Fed chair Jerome Powell , who kept rates on hold , @ @ @ @ @ @ @ meeting revealed that regardless who is president , as long as the Fed can expand the balance sheet at will , they continue holding all the cards .
First , the good news , according to Powell : It is truly owed to the Federal Reserve and government intervention that more money was digitally made into existence , of which some went into household spending .
However , despite the increase in money supply and debt levels , comes the bad news : Per the Fed , life did not become as unaffordable @ @ @ @ @ @ @ , therefore they expect to maintain an “ accommodative stance of monetary policy ” until prices rise enough , meeting their inflation objective .
And , at last , the confusing news , the part where the line between fiscal and monetary policy becomes blurred : Fiscal policy can do what we can , which is to replace lost incomes for people who are out of work through no fault of their own .
And then what we can do is we can obviously support financial stability through our lending programs , and @ @ @ @ @ @ @ and asset purchases and that sort of thing .
Perhaps it ’ s the size of the asset programs by the Fed or the spending programs of the government , that ideas around the two are continually intertwined .
Often , Powell must define the difference between the two , in this instance noting that the government can take action such as replacing lost wages , while the Fed can buy government bonds .
True , Congress can tax and spend , but what the chair doesn ’ t seem to admit is @ @ @ @ @ @ @ , compared to spending which appears to be nearly limitless .
Of course , what makes up the shortfall when spending exceeds taxation revenue , if not from debt ?
Considering the Fed owns $ 4.5 trillion of US Treasurys , of a nation with a $ 27 trillion debt , we should come to terms with understanding that the Fed is financing a significant portion of the US government ’ s spending activities .
Yet , it ’ s difficult to argue with one of the most powerful men on the planet @ @ @ @ @ @ @ money expansion , which is not “ money-financed fiscal policy , ” we should listen when he says : The majority of people will undoubtedly be watching to see how the election is called and the looming fallout , but we must remember : the government is financed by the people and also by its central bank .
The trajectory we are on is one where the Fed ’ s balance sheet will continually increase , with a corresponding decrease in the wealth and freedom of the individual .
How this fits in @ @ @ @ @ @ @ by the people and for the people is anyone ’ s guess .

Americans anxiously wait for the final outcome of this election, the Federal Reserve continues on its immovable course towards nationalization of the means of production. Ironically, we vote for a president who has limited power, but a hand on the nuke button; whereas, we don’t vote for the Fed chair, who has nearly unlimited power, and a hand on the economic equivalent to the nuke button; the ability to conjure money out of thin air.
As for Fed chair Jerome Powell, who kept rates on hold, his Q&A after the committee meeting revealed that regardless who is president, as long as the Fed can expand the balance sheet at will, they continue holding all the cards. First, the good news, according to Powell:
The overall rebound in household spending owes in part to federal stimulus payments and expanded unemployment benefits, which provided essential support to many families and individuals.
It is truly owed to the Federal Reserve and government intervention that more money was digitally made into existence, of which some went into household spending.
However, despite the increase in money supply and debt levels, comes the bad news:
As we said in September and again today, with inflation running persistently below 2 percent, we will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and longer-term inflation expectations remain well anchored at 2 percent.
Per the Fed, life did not become as unaffordable for the masses as they had hoped, therefore they expect to maintain an “accommodative stance of monetary policy” until prices rise enough, meeting their inflation objective.
And, at last, the confusing news, the part where the line between fiscal and monetary policy becomes blurred:
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Fiscal policy can do what we can, which is to replace lost incomes for people who are out of work through no fault of their own. And then what we can do is we can obviously support financial stability through our lending programs, and we can support demand through interest rates and asset purchases and that sort of thing.
Perhaps it’s the size of the asset programs by the Fed or the spending programs of the government, that ideas around the two are continually intertwined. Often, Powell must define the difference between the two, in this instance noting that the government can take action such as replacing lost wages, while the Fed can buy government bonds.
As explained:
Elected officials have the power to tax and spend and to make decisions about where we, as a society, should direct our collective resources.
True, Congress can tax and spend, but what the chair doesn’t seem to admit is that taxation only provides so much money, compared to spending which appears to be nearly limitless. Of course, what makes up the shortfall when spending exceeds taxation revenue, if not from debt? Considering the Fed owns $4.5 trillion of US Treasurys, of a nation with a $27 trillion debt, we should come to terms with understanding that the Fed is financing a significant portion of the US government’s spending activities.
Yet, it’s difficult to argue with one of the most powerful men on the planet when he says:
And so if the idea is money financed fiscal policy, that’s not something that we would consider. So that—what I mean by that is really, you know, the central bank is really funding fiscal activities of the government fairly directly. No. That’s not something we do.
As for the money expansion, which is not “money-financed fiscal policy,” we should listen when he says:
So when I say we’re not out of ammo, I’m looking at, you know, a couple of our tools mainly. As I mentioned, the asset purchase program.
The majority of people will undoubtedly be watching to see how the election is called and the looming fallout, but we must remember: the government is financed by the people and also by its central bank. The trajectory we are on is one where the Fed’s balance sheet will continually increase, with a corresponding decrease in the wealth and freedom of the individual. How this fits in with the concept of a strong republic by the people and for the people is anyone’s guess.


investmentwatchblog--2020-11-18--2021 courage challenge: Taking the first Covid vaccine and going on the first 737 flight while being

2021 courage challenge : Taking the first Covid vaccine and going on the first 737 flight while being all in @ @ @ @ @ 500. t.co/iC5X1sW69H

2021 courage challenge: Taking the first Covid vaccine and going on the first 737 flight while being all in long the S&P 500. t.co/iC5X1sW69H
— Sven Henrich (@NorthmanTrader) November 18, 2020


investmentwatchblog--2020-11-18--“I really do hope we get something,” Allianz Chief Economic Advisor

“ I really do hope we get something , ” Allianz Chief Economic Advisor @ elerianm says about additional fiscal @ @ @ @ @ actually needs some type of support right now.
” t.co/iJWOIQgiIk pic.twitter.com/AgmZ6nSth3

“I really do hope we get something,” Allianz Chief Economic Advisor @elerianm says about additional fiscal stimulus. “The economy actually needs some type of support right now.” t.co/iJWOIQgiIk pic.twitter.com/AgmZ6nSth3
— CNBC (@CNBC) November 18, 2020


investmentwatchblog--2020-11-18--Biden is not president-elect: Dershowitz explains Trump team’s legal strategy

Trump ’ s legal team says they have enough evidence that voting systems were ‘ used to rig the election @ @ @ @ @ election results .
And a Trump lawyer alleges that the voting system used in this @ @ @ @ @ company involved with the Venezuelan socialist regime .

Trump’s legal team says they have enough evidence that voting systems were ‘used to rig the election,’ to overturn the election results. And a Trump lawyer alleges that the voting system used in this election has ties to a company involved with the Venezuelan socialist regime.
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h/t Adam


investmentwatchblog--2020-11-18--Meet the dead people who voted in 2020 -comedy break-

Dead people are people too !
Who are we to keep the really silent majority from voting , haha

Dead people are people too! Who are we to keep the really silent majority from voting, haha
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h/t SwampCreature


investmentwatchblog--2020-11-18--McEnany dismisses public health guidelines to slow the spread of coronavirus as “Orwellian”

McEnany dismisses public health guidelines to slow the spread of coronavirus as `` Orwellian '' pic.twitter.com/S70IbQIce6

McEnany dismisses public health guidelines to slow the spread of coronavirus as "Orwellian" pic.twitter.com/S70IbQIce6
— Aaron Rupar (@atrupar) November 18, 2020


investmentwatchblog--2020-11-18--Technical Setup: A Correction is Coming

Technical Setup: A Correction is Coming

Let ’ s set politics aside today and focus on the stock market .
From a technical analysis perspective , the market has become extremely overstretched and is due for a correction .
The S & P 500 is trading above its monthly Bollinger Bands to the upside ( red circle in the chart below ) .
This means the stock market is now three standard deviations above their average historic price .
Any time stocks have performed a similar move in the last three years , it ’ s been quickly followed by a sharp decline , usually to @ @ @ @ @ @ @ S & P 500 .
You can see this for yourself in the chart below .
I ’ ve circled the last similar three occasions in which the S & P 500 was three standard deviations above its average historic price .
In simple terms , stocks are EXTREMELY overstretched and due for a breather .
I ’ ve identified the lines of support at which I would expect stocks to be a “ buy ” in the coming days .
Save your capital for now , and prepare to buy around those @ @ @ @ @ @ @ for this kind of precise guidance on how to invest in the markets… where the biggest opportunities are… and how to find unique picks with EXPLOSIVE potential , I strongly urge you to join our FREE e-letter , Gains Pains & Capital .
You can pick up three special reports ( a value of $ 99 ) without paying a cent , today at this link :

Let’s set politics aside today and focus on the stock market.
From a technical analysis perspective, the market has become extremely overstretched and is due for a correction.
The S&P 500 is trading above its monthly Bollinger Bands to the upside (red circle in the chart below). This means the stock market is now three standard deviations above their average historic price.
Any time stocks have performed a similar move in the last three years, it’s been quickly followed by a sharp decline, usually to the tune of 200+ points on the S&P 500.
You can see this for yourself in the chart below. I’ve circled the last similar three occasions in which the S&P 500 was three standard deviations above its average historic price.
In simple terms, stocks are EXTREMELY overstretched and due for a breather. I’ve identified the lines of support at which I would expect stocks to be a “buy” in the coming days. Save your capital for now, and prepare to buy around those levels.
If you’re looking for this kind of precise guidance on how to invest in the markets… where the biggest opportunities are… and how to find unique picks with EXPLOSIVE potential, I strongly urge you to join our FREE e-letter, Gains Pains & Capital.
We are primarily funded by readers. Please subscribe and donate to support us!
You can pick up three special reports (a value of $99) without paying a cent, today at this link:
phoenixcapitalmarketing.com/evergreen3reports.html
Best
Graham Summers
Chief Market Strategist
Phoenix Capital Research


investmentwatchblog--2020-11-18--AND THE HITS JUST KEEP ON COMING: The worst thing about Gavin Newsom’s French Laundry dinner? It was

AND THE HITS JUST KEEP ON COMING: The worst thing about Gavin Newsom’s French Laundry dinner? It was with a lobbyist.

[ Y ] es , I know that the birthday boy , Jason Kinney , 50 , and the governor , 53 , go way back .
Kinney is a longtime political operative who bounces back and forth between government , political campaigns ( he was the spokesman for 2016 ’ s Proposition 64 , which legalized cannabis for recreational use in California ) and lobbying .
That ’ s the way California ’ s unsavory political revolving door works .
But it ’ s Kinney ’ s role as a lobbyist that sounds alarms .
For people in his @ @ @ @ @ @ @ show the world you ’ ve got the governor ’ s ear .
Doing so can help bring in business from companies eager — or desperate — to get the governor ’ s attention .
Thanks to Politico we know , for example , that Kinney ’ s lobbying firm represents several small amusement park operators who have been pushing the governor to let them reopen their rides .
( They were allowed to briefly reopen before COVID-19 cases spiked and the restrictions were reinstated . )
His firm ’ s biggest client @ @ @ @ @ @ @ to Politico , “ is a member of a powerful oil industry organization that battled proposals to ban hydraulic fracturing.
” In September , Newsom made what some think was a halfhearted call to ban fracking in the state .
“ The buzz this weekend among lobbyists , ” wrote Politico , “ was how Kinney couldn ’ t have asked for better advertising of his close ties to Newsom.
” So , for anyone keeping score , a governor violating pandemic restrictions to attend a birthday dinner for a lobbyist may be @ @ @ @ @ @ @ but it ’ s a brilliant business move by the lobbyist .
Was Newsom played ?
I guess it depends on who squealed to the Chronicle about the party .

via latimes:
[Y]es, I know that the birthday boy, Jason Kinney, 50, and the governor, 53, go way back. Kinney is a longtime political operative who bounces back and forth between government, political campaigns (he was the spokesman for 2016’s Proposition 64, which legalized cannabis for recreational use in California) and lobbying. That’s the way California’s unsavory political revolving door works.
But it’s Kinney’s role as a lobbyist that sounds alarms. For people in his job, it’s important to show the world you’ve got the governor’s ear. Doing so can help bring in business from companies eager — or desperate — to get the governor’s attention.
Thanks to Politico we know, for example, that Kinney’s lobbying firm represents several small amusement park operators who have been pushing the governor to let them reopen their rides. (They were allowed to briefly reopen before COVID-19 cases spiked and the restrictions were reinstated.) His firm’s biggest client is Marathon Petroleum, which, according to Politico, “is a member of a powerful oil industry organization that battled proposals to ban hydraulic fracturing.” In September, Newsom made what some think was a halfhearted call to ban fracking in the state.
“The buzz this weekend among lobbyists,” wrote Politico, “was how Kinney couldn’t have asked for better advertising of his close ties to Newsom.”
So, for anyone keeping score, a governor violating pandemic restrictions to attend a birthday dinner for a lobbyist may be a terrible look for the governor, but it’s a brilliant business move by the lobbyist. Was Newsom played? I guess it depends on who squealed to the Chronicle about the party.


investmentwatchblog--2020-11-18--Why China Will Become #1 World Economy

Why China Will Become #1 World Economy

QUESTION : I believe you have said that in order for the Chinese to become the next superpower and be the monetary capital of the world the rule of law would have to exist .
Given the recent take down of Alibaba how can one have faith in a system governed by a communist hierarchy ?
ANSWER : Between now and about 2037 , a lot is going to happen .
Many questions have come in and argued that I have to be wrong about China , for they are a Communist government .
They are not communists , for @ @ @ @ @ @ @ create companies .
China was totally different from communism from Russia .
Stalin was paranoid after a counter-revolution because he was suppressing the people hard .
China had the tall-poppy syndrome .
As long as you keep your head down , it was not cut off .
Stalin had people killed because they were smart .
This is why China boomed after 1989 because they did not terrorize humanity like the Russians .
In East Germany , children were told if their parents spoke ill of the government to report them .
It @ @ @ @ @ @ @ within families .
What people seem to misunderstand about this forecast is thinking that China will just boom .
That is not the case .
This Great Reset is the self-destruction of Western society .
We have already witnessed the most drastic decline in GDP than any economic recession or Great Depression including that of the 1930s .
World GDP may shrink by more than 50 % by 2022 .
That means that China does not have to boom , all they need do is decline less than that of the west .

by Martin Armstrong
QUESTION: I believe you have said that in order for the Chinese to become the next superpower and be the monetary capital of the world the rule of law would have to exist. Given the recent take down of Alibaba how can one have faith in a system governed by a communist hierarchy?
TW
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ANSWER: Between now and about 2037, a lot is going to happen. Many questions have come in and argued that I have to be wrong about China, for they are a Communist government. They are not communists, for people are allowed to own property and create companies. China was totally different from communism from Russia. Stalin was paranoid after a counter-revolution because he was suppressing the people hard. China had the tall-poppy syndrome. As long as you keep your head down, it was not cut off. Stalin had people killed because they were smart. This is why China boomed after 1989 because they did not terrorize humanity like the Russians. In East Germany, children were told if their parents spoke ill of the government to report them. It was the classic divide and conquer even within families.
What people seem to misunderstand about this forecast is thinking that China will just boom. That is not the case. This Great Reset is the self-destruction of Western society. We have already witnessed the most drastic decline in GDP than any economic recession or Great Depression including that of the 1930s. World GDP may shrink by more than 50% by 2022. That means that China does not have to boom, all they need do is decline less than that of the west.


investmentwatchblog--2020-11-18--The autumnal outbreak in Europe has peaked as Herd Immunity is gradually reached

There are now clear signs the autumnal outbreak in Europe has peaked as Herd Immunity is gradually reached .
Daily @ @ @ @ @ falling in France , Spain , Netherlands , Belgium , Ireland , Poland , Czech @ @ @ @ @ .
Other countries are levelling off & will peak soon e.g .
Italy , Germany @ @ @ @ @ & the Balkans did not get hit in the Spring so have some way to @ @ @ @ @ .
They still have rising positive tests and deaths , e.g .
Ukraine , Serbia @ @ @ @ @ The UK will reach Herd Immunity by early in the New Year , whatever the @ @ @ @ @ which have no material effect on viral transmission , but do unnecessarily kill thousands of @ @ @ @ @ ) .
A rushed & potentially dangerous , non safety tested “ vaccine ” with @ @ @ @ @ term side effects and highly questionable efficacy , is NOT required .

by Ian56
There are now clear signs the autumnal outbreak in Europe has peaked as Herd Immunity is gradually reached.
Daily positive tests are now rapidly falling in France, Spain, Netherlands, Belgium, Ireland, Poland, Czech Republic, Slovakia and Switzerland. Other countries are levelling off & will peak soon e.g. Italy, Germany & Austria.
We are primarily funded by readers. Please subscribe and donate to support us!
Eastern Europe & the Balkans did not get hit in the Spring so have some way to go to reach Herd Immunity. They still have rising positive tests and deaths, e.g. Ukraine, Serbia, Bulgaria and Greece.
The UK will reach Herd Immunity by early in the New Year, whatever the government does with Lockdowns (which have no material effect on viral transmission, but do unnecessarily kill thousands of people from non Covid causes). A rushed & potentially dangerous, non safety tested “vaccine” with completely unknown medium and long term side effects and highly questionable efficacy, is NOT required.


investmentwatchblog--2020-11-18--OANN Reports Data Recovered from Scytl Give President Trump 410 Electoral Votes

Looks like President Trump will get at minimum his 410 electoral votes .

Looks like President Trump will get at minimum his 410 electoral votes.
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investmentwatchblog--2020-11-18--Home Depot is spending $1 billion to give thousands of its workers a raise

Sitting on bumper profits and cash as consumers remodel their homes during the pandemic , Home Depot ( HD ) is joining a growing list of big box retailers giving its workers a raise after a busy and challenging year during the COVID-19 pandemic .
The home improvement retailer said Tuesday it will invest $ 1 billion in what it calls ‘ incremental compensation ’ annually for its workers .
A Home Depot spokesperson declined to share specifics on how much the company ’ s average hourly wage will increase after the investment .
“ It varies market by market @ @ @ @ @ @ @ , is based on skills , responsibilities , performance and market rates , ” the spokesperson told Yahoo Finance .
According to Glassdoor , the average hourly wage for a Home Depot cashier is $ 11 an hour .
A sales associate earns $ 12 an hour , per Glassdoor .
The spokesperson said the “ majority ” of Home Depot ’ s 400,000 total employees will receive a pay bump from the new investment .
Other big box chains — sitting on big profits as consumers have stocked up on food and @ @ @ @ @ @ @ also opened their wallets .
In July , Target raised its starting wage for its store , distribution and headquarter employees to $ 15 an hour .
The move impacted 275,000 employees who work at the company ’ s stores and distribution centers .
Target raised its starting minimum wage to $ 13 an hour in June as part of a commitment unveiled in 2017 to reach $ 15 an hour by 2020 .

Sitting on bumper profits and cash as consumers remodel their homes during the pandemic, Home Depot (HD) is joining a growing list of big box retailers giving its workers a raise after a busy and challenging year during the COVID-19 pandemic.
The home improvement retailer said Tuesday it will invest $1 billion in what it calls ‘incremental compensation’ annually for its workers. A Home Depot spokesperson declined to share specifics on how much the company’s average hourly wage will increase after the investment.
“It varies market by market. Our compensation, at all levels, is based on skills, responsibilities, performance and market rates,” the spokesperson told Yahoo Finance. According to Glassdoor, the average hourly wage for a Home Depot cashier is $11 an hour. A sales associate earns $12 an hour, per Glassdoor.
The spokesperson said the “majority” of Home Depot’s 400,000 total employees will receive a pay bump from the new investment.
Other big box chains — sitting on big profits as consumers have stocked up on food and cleaning products amidst the pandemic — have also opened their wallets.
In July, Target raised its starting wage for its store, distribution and headquarter employees to $15 an hour. The move impacted 275,000 employees who work at the company’s stores and distribution centers. Target raised its starting minimum wage to $13 an hour in June as part of a commitment unveiled in 2017 to reach $15 an hour by 2020.


investmentwatchblog--2020-11-18--For The NIO Earnings Players

For The NIO Earnings Players

Some information that will help you plan your trades !
Current MMM : +/- $ 6.50 ( NIO needs to move more than this dollar amount in the direction you ’ re playing it to make money on your options ) IV of options expiring this week : 222.11 % IV of options expiring next week : 178 % ^^^ there ’ s about 44 % of volatility priced in to this week ’ s options ) Current one standard deviation range : $ 53.13 to 40.95 ( 68.27 % chance it stays here ) Current two standard deviation range @ @ @ @ @ @ @ % chance it stays here ) The above ranges are where I ’ ll be looking to plan some spreads , but will need to see how price action plays out throughout and towards the end of the day first .
Just wanted to throw out this info for those thinking of playing NIO earnings or those that didn ’ t know you could almost 100 % guarantee profits with spreads/more advanced options strats .
Also with that , less risk = less reward .
The higher the probability of success , the @ @ @ @ @ @ @ Good luck everyone !
Disclaimer : This information is only for educational purposes .
Do not make any investment decisions based on the information in this article .
Do you own due diligence or consult your financial professional before making any investment decision .

by dnautatrades
Some information that will help you plan your trades!
We are primarily funded by readers. Please subscribe and donate to support us!
Current MMM: +/- $6.50 (NIO needs to move more than this dollar amount in the direction you’re playing it to make money on your options)
IV of options expiring this week: 222.11%
IV of options expiring next week: 178%
^^^ there’s about 44% of volatility priced in to this week’s options)
Current one standard deviation range: $53.13 to 40.95 (68.27% chance it stays here)
Current two standard deviation range: $60.36 to 35.84 (95.45% chance it stays here)
The above ranges are where I’ll be looking to plan some spreads, but will need to see how price action plays out throughout and towards the end of the day first.
Just wanted to throw out this info for those thinking of playing NIO earnings or those that didn’t know you could almost 100% guarantee profits with spreads/more advanced options strats. Also with that, less risk = less reward. The higher the probability of success, the lower max profit you will have.
Good luck everyone!
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.


investmentwatchblog--2020-11-18--Trading the other side of TSLA S&P addition

The big day is here , Elon has delivered .
TSLA is finally entering the S & P 500 .
That means 422b of new market cap , the biggest company ever to be added to the S & P .
On the other hand , we will likely see one or more tickers removed from the index which could mean short term underperformance .
This trade revolves around shorting names that could be booted from the S & P because of Tesla .
The bottom 10 stocks in the S & P by market cap ( likely to be @ @ @ @ @ @ @ Out of the 10 companies removed from the S & P this year , 2 have been in oil and gas ( Helmerich and Payne , Cimarex Energy ) , and 5 have been retail/consumer facing ( Kohls , Coty , Nordstrom , Capri Holdings , Macy ’ s ) .
If we look at companies in the bottom of the S & P which fit this profile , a few stick out ( excluding UA due to the share class structure ) : These are four companies that seem to have a @ @ @ @ @ @ @ subsequently underperforming .
I ’ m taking cheap bear call spreads on each that will net a payout initially , and hold up if one or more of the companies are excluded from the S & P Let me know what you think of this trade , was also looking into selling calls on these names , but got a bit scared by higher potential downside if the market goes on tear randomly Disclaimer : This information is only for educational purposes .
Do not make any investment decisions based on the information @ @ @ @ @ @ @ due diligence or consult your financial professional before making any investment decision .

by YellenTheDestroyer
The big day is here, Elon has delivered. TSLA is finally entering the S&P 500. That means 422b of new market cap, the biggest company ever to be added to the S&P. On the other hand, we will likely see one or more tickers removed from the index which could mean short term underperformance. This trade revolves around shorting names that could be booted from the S&P because of Tesla.
The bottom 10 stocks in the S&P by market cap (likely to be removed) are currently (www.slickcharts.com/sp500)
Xerox (XRX)
Apache Corporation (APA)
SL Green Realty (SLG)
Ralph Lauren (RL)
Vontier (VNT)
Discovery Inc. Class A (DISCA)
HollyFrontier (HFC)
TechnipFMC (FTI)
UAA (Under Armour Class A) (UAA)
UA (Under Armour Class C) (UA)
News Corporation Class B (NWS)
Out of the 10 companies removed from the S&P this year, 2 have been in oil and gas (Helmerich and Payne, Cimarex Energy), and 5 have been retail/consumer facing (Kohls, Coty, Nordstrom, Capri Holdings, Macy’s).
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If we look at companies in the bottom of the S&P which fit this profile, a few stick out (excluding UA due to the share class structure):
Apache (APA) (Oil/Gas)
Ralph Lauren (RL) (Consumer/Retail)
HollyFrontier (HFC) (Oil/Gas)
TechnipFMC (FTI) (Oil/Gas)
These are four companies that seem to have a reasonable chance of being excluded, and subsequently underperforming. I’m taking cheap bear call spreads on each that will net a payout initially, and hold up if one or more of the companies are excluded from the S&P
Let me know what you think of this trade, was also looking into selling calls on these names, but got a bit scared by higher potential downside if the market goes on tear randomly
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.


investmentwatchblog--2020-11-18--Bitcoin just touched a record market value, exceeding its 2017 top

The world ’ s most prominent digital currency on Tuesday is back to carving out records just like it was 2017 .
The No .
1 crypto ’ s nearly 8 % weekly rise and 30 % gain so far in November has helped the asset hit a market value of around $ 328 billion , according to digital-currency data site CoinMarketCap .
That level surpasses the roughly $ 322.7 billion value that bitcoin hit on Dec. 17 when its price was nearly $ 20,000 ( see chart ) .
Although bitcoin ’ s price BTCUSD , 5.03 % BTCUSD @ @ @ @ @ @ @ that 2017 record level , it currently sits about 12 % shy of touching a round-number milestone at $ 20,000 .
It quietly has been drawing more attention and notching a fresh all-time peak for an asset considered one of the most polarizing of this generation of financial markets .
Bitcoin ’ s record market capitalization reflects the attention that the blockchain-based asset has garnered over its rivals .
So-called bitcoin dominance , or the share of bitcoin ’ s value as it contributes to the universe of recognized digital currencies , was @ @ @ @ @ @ @ CoinMarketCap .
Bitcoin ’ s market-cap dominance is near to its highest level since May of 2020 .

www.marketwatch.com/story/bitcoin-just-touched-a-record-market-value-exceeding-its-2017-top-11605643255
The world’s most prominent digital currency on Tuesday is back to carving out records just like it was 2017. The No. 1 crypto’s nearly 8% weekly rise and 30% gain so far in November has helped the asset hit a market value of around $328 billion, according to digital-currency data site CoinMarketCap.
That level surpasses the roughly $322.7 billion value that bitcoin hit on Dec. 17 when its price was nearly $20,000 (see chart).
Although bitcoin’s price BTCUSD, 5.03% BTCUSD, 5.03% hasn’t exceeded that 2017 record level, it currently sits about 12% shy of touching a round-number milestone at $20,000. It quietly has been drawing more attention and notching a fresh all-time peak for an asset considered one of the most polarizing of this generation of financial markets.
Bitcoin’s record market capitalization reflects the attention that the blockchain-based asset has garnered over its rivals.
So-called bitcoin dominance, or the share of bitcoin’s value as it contributes to the universe of recognized digital currencies, was at 65.7%, as tracked by CoinMarketCap. Bitcoin’s market-cap dominance is near to its highest level since May of 2020.


investmentwatchblog--2020-11-18--Attentional Bias on the Robinhood Platform Causes Herding by “Naive” Investors That Hedge Funds can

Attentional Bias on the Robinhood Platform Causes Herding by “Naive” Investors That Hedge Funds can Short.

Herding by ‘ Naive ’ Robinhood Traders May Be Good Signal to Short finance.yahoo.com/news/herding-naive-robinhood-traders-may-153448816.html “ Users of the millennial-friendly app @ @ @ @ @ commission-free trading — are more likely to chase popular stocks with extreme performance .
The @ @ @ @ @ becomes a drag on those companies ’ returns , according to the latest academic research @ @ @ @ @ Robinhood users pile into a stock in large numbers , the average excess return on @ @ @ @ @ % .
But this is followed by a reversal of nearly 5 % over the @ @ @ @ @ paper found .
The thinking is that in seeking to make investing easier , the @ @ @ @ @ could be resulting in concentrated trading in the most “ attention grabbing ” shares .
@ @ @ @ @ herding which can lead to big market reversals .
”

Interesting read:
Herding by ‘Naive’ Robinhood Traders May Be Good Signal to Short
finance.yahoo.com/news/herding-naive-robinhood-traders-may-153448816.html
“Users of the millennial-friendly app — the first to offer commission-free trading — are more likely to chase popular stocks with extreme performance. The result is herding that ultimately becomes a drag on those companies’ returns, according to the latest academic research into retail investing.
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When Robinhood users pile into a stock in large numbers, the average excess return on the day surges to 14%. But this is followed by a reversal of nearly 5% over the subsequent month, a new paper found.
The thinking is that in seeking to make investing easier, the platform’s slimmed-down interface could be resulting in concentrated trading in the most “attention grabbing” shares. That increases the chance of herding which can lead to big market reversals.”
h/t risk_parity


investmentwatchblog--2020-11-18--The Fed Has No Way Out

The Fed Has No Way Out

We have argued that the Federal Reserve has no exit strategy from this extraordinary monetary policy .
In fact , it never could extricate itself from the extraordinary monetary policy it launched during the Great Recession .
Today , we ’ re merely witnessing the same policy on hyperdrive .
And there is still no way out .
After blowing up its balance sheet to over $ 4 trillion during the Great Recession , the Fed tried to pull back .
Through quantitative tightening , the Fed managed to get it down to just over $ 3.7 trillion before the @ @ @ @ @ @ @ the central bank abandoned its plans to normalize monetary policy .
At that point , it ended balance sheet reduction and dropped interest rates three times the following year .
Not only that , it relaunched quantitative easing , although the central bankers kept insisting it wasn ’ t QE .
Most people assume the Fed started growing its balance sheet again as an emergency measure in response to the COVID-19 pandemic .
But the balance sheet was already back over $ 4 trillion before coronavirus even reared its ugly head .
The @ @ @ @ @ @ @ floor and today the Fed balance sheet is over $ 7 trillion Since 2008 , the Federal Reserve and the US government have pumped more than $ 36 trillion into the US economy .
But they have “ bought ” very little in terms of economic growth with all that massive “ investment.
” The Fed has pumped in roughly $ 12 of liquidity for every $ 1 of economic growth .
You see this cycle more clearly if you go back to 1999 at the height of the dot-com bubble .
Each @ @ @ @ @ @ @ monetary intervention has failed to attain the level of economic growth seen in the previous .
In other words , as the level of money printing rises during each crisis , the level of growth in the preceding boom falls .
Just like the addict suffers diminishing returns and needs more and more of his drug to get him high , the economy needs more and more stimulus simply to maintain the currently tepid level of economic growth .
And now that we ’ re in this cycle , there is really no @ @ @ @ @ @ @ put it , “ They are increasingly on what I call a no-exit paradigm.
” Easy money leads to an increased level of debt .
The US national debt has ballooned to over $ 27 trillion .
Meanwhile , the Federal Reserve recently issued a warning about growing levels of business debt .
Former Fed Governor Randall Kroszner recently summed it up this way .
Rising interest rates would be the final nail in the coffin for an economy built on piles of debt .
It has to continue forcing interest rates low @ @ @ @ @ @ @ .
Meanwhile , the markets are totally dependent on the Fed .
El-Erian said that central banks have “ conditioned ” the markets to the point that every time the Fed tries to “ step back ” and normalize monetary policy , the market “ forces them back in by selling off and tightening financial conditions.
” This is exactly what happened in late 2018 .
The stock market threw a tantrum as the Fed nudged rates up and shrank its balance sheet .
Powel immediately reversed course , as already noted .
@ @ @ @ @ @ @ question : if the Fed couldn ’ t exit then , how is it going to now with another $ 3 trillion on its balance sheet ( and rising ) ?
In a nutshell , the Fed is stuck with forever stimulus .
As an article at Real Investment Advice put it : So the Fed is stuck between the proverbial rock and a hard place .
It can ’ t withdraw the “ emergency ” monetary policy .
But continuing it forever comes with its own risks , as Bloomberg recently noted @ @ @ @ @ @ @ it does and damned if it doesn ’ t .
It truly looks like there is no way out .

Via SchiffGold.com,
We have argued that the Federal Reserve has no exit strategy from this extraordinary monetary policy. In fact, it never could extricate itself from the extraordinary monetary policy it launched during the Great Recession. Today, we’re merely witnessing the same policy on hyperdrive. And there is still no way out.
After blowing up its balance sheet to over $4 trillion during the Great Recession, the Fed tried to pull back. Through quantitative tightening, the Fed managed to get it down to just over $3.7 trillion before the stock market tanked in late 2018 and the central bank abandoned its plans to normalize monetary policy. At that point, it ended balance sheet reduction and dropped interest rates three times the following year. Not only that, it relaunched quantitative easing, although the central bankers kept insisting it wasn’t QE.
Most people assume the Fed started growing its balance sheet again as an emergency measure in response to the COVID-19 pandemic. But the balance sheet was already back over $4 trillion before coronavirus even reared its ugly head. The pandemic pressed the easy-money accelerator to the floor and today the Fed balance sheet is over $7 trillion
Since 2008, the Federal Reserve and the US government have pumped more than $36 trillion into the US economy. But they have “bought” very little in terms of economic growth with all that massive “investment.” The Fed has pumped in roughly $12 of liquidity for every $1 of economic growth.
You see this cycle more clearly if you go back to 1999 at the height of the dot-com bubble. Each boom created by the Fed’s monetary intervention has failed to attain the level of economic growth seen in the previous. In other words, as the level of money printing rises during each crisis, the level of growth in the preceding boom falls. Just like the addict suffers diminishing returns and needs more and more of his drug to get him high, the economy needs more and more stimulus simply to maintain the currently tepid level of economic growth.
And now that we’re in this cycle, there is really no way out. As economist Mohammed El-Erian put it, “They are increasingly on what I call a no-exit paradigm.”
Easy money leads to an increased level of debt. The US national debt has ballooned to over $27 trillion. Meanwhile, the Federal Reserve recently issued a warning about growing levels of business debt.
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Former Fed Governor Randall Kroszner recently summed it up this way.
The big debts that governments are racking up are going to make it difficult for central banks to raise rates when they feel the need to do so because that will increase borrowing costs.”
Rising interest rates would be the final nail in the coffin for an economy built on piles of debt. It has to continue forcing interest rates low to keep the debt bubble from popping.
Meanwhile, the markets are totally dependent on the Fed. El-Erian said that central banks have “conditioned” the markets to the point that every time the Fed tries to “step back” and normalize monetary policy, the market “forces them back in by selling off and tightening financial conditions.”
This is exactly what happened in late 2018. The stock market threw a tantrum as the Fed nudged rates up and shrank its balance sheet. Powel immediately reversed course, as already noted.
So here’s the $64,000 question: if the Fed couldn’t exit then, how is it going to now with another $3 trillion on its balance sheet (and rising)?
In a nutshell, the Fed is stuck with forever stimulus. As an article at Real Investment Advice put it:
The trap the Federal Reserve has stumbled into is that it continues to require more interventions to sustain lower rates of economic growth. Whenever the Fed withdraws interventions, economic growth collapses.”
So the Fed is stuck between the proverbial rock and a hard place. It can’t withdraw the “emergency” monetary policy. But continuing it forever comes with its own risks, as Bloomberg recently noted.
If the Fed and other central banks are constrained from scaling back emergency stimulus, the continued flood of liquidity could spur asset bubbles and even too-rapid inflation.”
So the Fed is damned if it does and damned if it doesn’t. It truly looks like there is no way out.


investmentwatchblog--2020-11-18--With a Biden Win, The War Party Will Be Back in Full Force

If Democratic candidate Joe Biden is elected America ’ s forty-sixth president , what happens to the mandate to end the endless wars ?
It doesn ’ t go away , but rather falls on the Democrat-controlled House and ( presumably , for now ) Republican-controlled Senate .
President Donald Trump was elected partly due to his promise to rein in the US government ’ s military intervention abroad .
He managed to not start any new wars , but he hasn ’ t ended any either .
That may be changing in Afghanistan now .
Only time will tell @ @ @ @ @ @ @ be be sooner rather than later .
However dissatisfying Trump ’ s contributions to peace and a nonintervention foreign policy have been , his policies have also enraged the War Party , which went all in for Biden .
The late antiwar writer Justin Raimondo once described the War Party this way : “ that complex of social , political , and economic forces that constitute a permanent and powerful lobby on behalf of imperialism and militarism.
” With a long list of war hawks as his backers and Senator Kamala Harris as @ @ @ @ @ @ @ hope that Biden will embrace Trump ’ s foreign policy agenda , let alone be a more antiwar version of President Barack Obama .
In June 2020 , nearly three hundred former Bush officials announced they were backing Biden as president by launching a PAC .
Hoping to mobilize disaffected hawkish Republicans who felt marginalized due to Trump ’ s win , the group added dozens of former senator Mitt Romney ’ s 2012 presidential campaign staffers as well as more than a hundred former staff members of deceased senator John McCain ’ @ @ @ @ @ @ @ so effective in bringing neoconservatives together with the sole purpose of beating Trump ’ s foreign policy that more than seventy former US national security officials joined the effort .
To them , Trump ’ s term proved crippling to America ’ s national security .
A Biden presidency , on the other hand , would mean a return to a fully bellicose America .
“ Very capable foreign policy advisers stood by him during the election campaign , ” former secretary of state Henry Kissinger , famous for his role in terror @ @ @ @ @ @ @ .
Nothing in Biden ’ s record or campaign offers any sign that he will run things differently from Trump ’ s recent predecessors .
Biden has supported virtually every war that the US has waged during his near forty years in office , including while he was the ranking Democrat on the Foreign Affairs Committee in the run-up to the 2003 Iraq War .
Furthermore , his campaign has claimed Biden will initially use diplomacy to force Syria ’ s Bashar al-Assad to “ share power.
” In other words , a @ @ @ @ @ @ @ yet another Middle Eastern leader down .
None of this was made an issue in the media this year .
Instead , the Commission on Presidential Debates removed foreign policy from the final debate .
Reporters covering Biden never grilled him on his foreign policy stances , and his campaign released little information on what the candidate intended to do with the troops stationed in the Middle East .
That doesn ’ t mean the American people don ’ t care about foreign policy .
In addition to the ascendant progressive caucus of @ @ @ @ @ @ @ on his support from 2016 and so did Republicans running who embraced his America First agenda .
The wars abroad remain unpopular .
What remains to be seen is whether Congress will collapse under pressure from the War Party or seize upon the disconnect between Biden and the American people .
Unfortunately , recent history all but guarantees that some congressmen and senators will deem the former more advantageous for their political careers .
In early 2019 , Trump announced he was planning on pulling US forces out of Syria .
The Islamic @ @ @ @ @ @ @ , and there was no reason why US troops should remain in the region .
Going against intelligence officials , he ordered the military to lay the groundwork for troop removal , beginning with half of the fourteen thousand US forces that at the time remained in Afghanistan .
Following his announcement , McConnell sponsored an amendment opposing Trump ’ s plan , arguing that the Islamic State as well as al-Qaeda remained a threat to the United States .
A withdrawal then would be “ precipitous , ” McConnell argued , as @ @ @ @ @ @ @ , destabilize critical regions and create vacuums that could be filled by Iran or Russia.
” With the support of senators from both parties , the amendment passed .
Senator Rand Paul ( R-KY ) , one of the few who stood against it , congratulated Trump for being “ bold enough and strong enough ” to bring the troops home .
Calling the bipartisanship group a “ war caucus , ” Paul criticized Democrats and Republicans for coming together against the president .
“ What is the one thing that brings Republicans @ @ @ @ @ @ @ reporters .
“ War—they love it .
The more , the better .
Forever war , perpetual war.
” Author : Alice Salles was born and raised in Brazil but has lived in America for over ten years .
She now lives in Fort Wayne , Indiana with her husband Nick Hankoff and their three children .

by Alice Salles via Mises
If Democratic candidate Joe Biden is elected America’s forty-sixth president, what happens to the mandate to end the endless wars? It doesn’t go away, but rather falls on the Democrat-controlled House and (presumably, for now) Republican-controlled Senate.
President Donald Trump was elected partly due to his promise to rein in the US government’s military intervention abroad. He managed to not start any new wars, but he hasn’t ended any either. That may be changing in Afghanistan now. Only time will tell, but it’ll have to be be sooner rather than later.
However dissatisfying Trump’s contributions to peace and a nonintervention foreign policy have been, his policies have also enraged the War Party, which went all in for Biden.
The late antiwar writer Justin Raimondo once described the War Party this way: “that complex of social, political, and economic forces that constitute a permanent and powerful lobby on behalf of imperialism and militarism.”
With a long list of war hawks as his backers and Senator Kamala Harris as his running mate, there is no hope that Biden will embrace Trump’s foreign policy agenda, let alone be a more antiwar version of President Barack Obama.
Neoconservatives Back Biden
In June 2020, nearly three hundred former Bush officials announced they were backing Biden as president by launching a PAC.
Hoping to mobilize disaffected hawkish Republicans who felt marginalized due to Trump’s win, the group added dozens of former senator Mitt Romney’s 2012 presidential campaign staffers as well as more than a hundred former staff members of deceased senator John McCain’s congressional offices.
The alliance was so effective in bringing neoconservatives together with the sole purpose of beating Trump’s foreign policy that more than seventy former US national security officials joined the effort.
To them, Trump’s term proved crippling to America’s national security. A Biden presidency, on the other hand, would mean a return to a fully bellicose America.
“Very capable foreign policy advisers stood by him during the election campaign,” former secretary of state Henry Kissinger, famous for his role in terror bombing Vietnam and Cambodia, said recently.
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Nothing in Biden’s record or campaign offers any sign that he will run things differently from Trump’s recent predecessors. Biden has supported virtually every war that the US has waged during his near forty years in office, including while he was the ranking Democrat on the Foreign Affairs Committee in the run-up to the 2003 Iraq War. Furthermore, his campaign has claimed Biden will initially use diplomacy to force Syria’s Bashar al-Assad to “share power.” In other words, a Biden/Harris administration would actively seek to bring yet another Middle Eastern leader down.
None of this was made an issue in the media this year. Instead, the Commission on Presidential Debates removed foreign policy from the final debate. Reporters covering Biden never grilled him on his foreign policy stances, and his campaign released little information on what the candidate intended to do with the troops stationed in the Middle East.
That doesn’t mean the American people don’t care about foreign policy. In addition to the ascendant progressive caucus of the Democratic Party, Trump also improved on his support from 2016 and so did Republicans running who embraced his America First agenda. The wars abroad remain unpopular.
What remains to be seen is whether Congress will collapse under pressure from the War Party or seize upon the disconnect between Biden and the American people. Unfortunately, recent history all but guarantees that some congressmen and senators will deem the former more advantageous for their political careers.
“War Caucus”
In early 2019, Trump announced he was planning on pulling US forces out of Syria. The Islamic State had been defeated, he explained, and there was no reason why US troops should remain in the region. Going against intelligence officials, he ordered the military to lay the groundwork for troop removal, beginning with half of the fourteen thousand US forces that at the time remained in Afghanistan.
Following his announcement, McConnell sponsored an amendment opposing Trump’s plan, arguing that the Islamic State as well as al-Qaeda remained a threat to the United States. A withdrawal then would be “precipitous,” McConnell argued, as it would “allow terrorists to regroup, destabilize critical regions and create vacuums that could be filled by Iran or Russia.”
With the support of senators from both parties, the amendment passed. Senator Rand Paul (R-KY), one of the few who stood against it, congratulated Trump for being “bold enough and strong enough” to bring the troops home.
Calling the bipartisanship group a “war caucus,” Paul criticized Democrats and Republicans for coming together against the president.
“What is the one thing that brings Republicans and Democrats together?” Paul asked reporters. “War—they love it. The more, the better. Forever war, perpetual war.”Author:
Alice Salles
Alice Salles was born and raised in Brazil but has lived in America for over ten years. She now lives in Fort Wayne, Indiana with her husband Nick Hankoff and their three children.


investmentwatchblog--2020-11-18--Great video explaining the unreliability of PCR tests

The Key to understanding the Covid-19 “ pandemic ” is knowing about the PCR Test .
All the ‘ scary @ @ @ @ @ the “ Covid infections ” , the “ Covid cases ” , the “ Covid @ @ @ @ @ Covid deaths ” all hang on this not-fit-for-purpose PCR test .

The Key to understanding the Covid-19 “pandemic” is knowing about the PCR Test. All the ‘scary’ things you hear, the “Covid infections”, the “Covid cases”, the “Covid Hospitalisations” and the “Covid deaths” all hang on this not-fit-for-purpose PCR test.
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investmentwatchblog--2020-11-19--New Strains Of COVID Could Render Vaccines Completely Useless, And 2 Dangerous New Strains Are Alrea

New Strains Of COVID Could Render Vaccines Completely Useless, And 2 Dangerous New Strains Are Already Spreading

What if all of the assumptions that people are making about this COVID pandemic are completely wrong ?
When Pfizer announced that they had developed a successful vaccine for COVID , the world cheered .
And then when Moderna announced that they had developed a successful vaccine for COVID , the world cheered even more .
But COVID has been mutating , and scientists assure us that it will keep mutating .
So what happens if the vaccines that are being developed end up being completely useless against new mutant strains of the virus ?
Would that put us all @ @ @ @ @ @ @ or even worse ) ?
To put this problem into perspective , let ’ s talk about the flu for a moment .
Every year , health authorities come up with a flu vaccine that they think will be effective against the variation or variations of the flu that they believe will be dominant in that particular year .
Most people simply assume that a “ flu shot ” will provide them with complete protection against “ the flu ” , but that is actually not true at all .
In some years @ @ @ @ @ @ @ the variations of the flu that are running around is pretty good , and some years that is definitely not the case .
The following comes from the official CDC website… During years when the flu vaccine is not well matched to circulating influenza viruses , it is possible that little or no benefit from flu vaccination may be observed .
During years when there is a good match between the flu vaccine and circulating viruses , it is possible to measure substantial benefits from flu vaccination in terms of preventing flu illness @ @ @ @ @ @ @ years when the flu vaccine match is good , the benefits of flu vaccination will vary , depending on various factors like the characteristics of the person being vaccinated , what influenza viruses are circulating that season and even , potentially , which type of flu vaccine was used .
At this point , Pfizer and Moderna both seem convinced that their vaccines will be effective against the dominant strain of COVID that is currently sweeping across the globe .
But what if a new strain becomes dominant ?
In Denmark , a @ @ @ @ @ @ @ passed to humans from minks was considered to be so dangerous that the government actually announced that they would kill all 17 million minks in the entire nation… The government of Denmark shocked the world a few days ago when it announced it would slaughter as many as 17 million minks in the country , effectively destroying the entire mink fur industry in the country .
The officials opted for this radical option because of the novel coronavirus , as the pathogen developed a potentially dangerous mutation inside the captive mink population .
@ @ @ @ @ @ @ mutated coronavirus has already infected at least 12 people .
Researchers are worried that the new strain might be so dangerous that it could effectively render the current COVID-19 vaccine candidates useless .
A new report now delivers more troublesome news , as some researchers think that the mutated coronavirus strain has pandemic potential .
Others , meanwhile , are calling for calm .
Thankfully , after a tremendous uproar the Danish government decided not to kill all the minks .
But this strain is still spreading , and as the quote above @ @ @ @ @ @ @ effectively render the current COVID-19 vaccine candidates useless ” .
In other words , if this Denmark strain becomes dominant it may force the vaccine companies to go back to the drawing board .
Meanwhile , we just learned that “ a fast-spreading new strain of COVID-19 ” has popped up in Australia… The reason why authorities decided to lock down all of South Australia for six days is because this new strain appears to be far more contagious than previous strains… If it is true that this new strain spreads five times @ @ @ @ @ @ @ could easily become dominant .
And if that happens , the vaccines that have been developed may not be of any use at all .
We just don ’ t know at this point .
But what we do know is that COVID will continue to mutate in the months and years ahead , and that could potentially create massive headaches for vaccine developers .
As for the vaccines that have already been created , some experts are pointing out that there is so much that is unknown about them .
Most people @ @ @ @ @ @ @ to other vaccines that they have previously taken , but that is definitely not true .
These new vaccines are in an entirely new class all by themselves .
They are known as “ messenger RNA ” ( mRNA ) vaccines , and they work by hijacking the protein-making machinery in your cells… I certainly do not want my cells “ hijacked ” , and nobody has any idea what the long-term effects will look like .
And even if you take one of these new vaccines , it could end up doing @ @ @ @ @ @ @ a different strain emerges and becomes dominant .
Unfortunately , I believe that we have entered an era of global pandemics , and I am convinced that all of this enthusiasm about the vaccines that have been developed is completely misguided .
We know that COVID will continue to mutate , but we have no idea at all if the current vaccines will be effective against those future strains or not .
If fighting diseases was easy , we would have eradicated the common cold and the flu long ago .
But we @ @ @ @ @ @ @ ’ t be eradicating COVID either .
Even now , dangerous new strains of COVID are emerging , and I have a feeling that it is going to be COVID that is going to have the last laugh .

by Michael Snyder
What if all of the assumptions that people are making about this COVID pandemic are completely wrong? When Pfizer announced that they had developed a successful vaccine for COVID, the world cheered. And then when Moderna announced that they had developed a successful vaccine for COVID, the world cheered even more. But COVID has been mutating, and scientists assure us that it will keep mutating. So what happens if the vaccines that are being developed end up being completely useless against new mutant strains of the virus? Would that put us all the way back to square one (or even worse)?
To put this problem into perspective, let’s talk about the flu for a moment. Every year, health authorities come up with a flu vaccine that they think will be effective against the variation or variations of the flu that they believe will be dominant in that particular year. Most people simply assume that a “flu shot” will provide them with complete protection against “the flu”, but that is actually not true at all. In some years the match between the flu vaccine and the variations of the flu that are running around is pretty good, and some years that is definitely not the case. The following comes from the official CDC website…
During years when the flu vaccine is not well matched to circulating influenza viruses, it is possible that little or no benefit from flu vaccination may be observed. During years when there is a good match between the flu vaccine and circulating viruses, it is possible to measure substantial benefits from flu vaccination in terms of preventing flu illness and complications. However, even during years when the flu vaccine match is good, the benefits of flu vaccination will vary, depending on various factors like the characteristics of the person being vaccinated, what influenza viruses are circulating that season and even, potentially, which type of flu vaccine was used.
At this point, Pfizer and Moderna both seem convinced that their vaccines will be effective against the dominant strain of COVID that is currently sweeping across the globe.
But what if a new strain becomes dominant?
In Denmark, a new strain of COVID that is being passed to humans from minks was considered to be so dangerous that the government actually announced that they would kill all 17 million minks in the entire nation…
The government of Denmark shocked the world a few days ago when it announced it would slaughter as many as 17 million minks in the country, effectively destroying the entire mink fur industry in the country. The officials opted for this radical option because of the novel coronavirus, as the pathogen developed a potentially dangerous mutation inside the captive mink population. Reports from the country said that the mutated coronavirus has already infected at least 12 people. Researchers are worried that the new strain might be so dangerous that it could effectively render the current COVID-19 vaccine candidates useless. A new report now delivers more troublesome news, as some researchers think that the mutated coronavirus strain has pandemic potential. Others, meanwhile, are calling for calm.
Thankfully, after a tremendous uproar the Danish government decided not to kill all the minks.
But this strain is still spreading, and as the quote above noted, this new strain “could effectively render the current COVID-19 vaccine candidates useless”.
In other words, if this Denmark strain becomes dominant it may force the vaccine companies to go back to the drawing board.
Meanwhile, we just learned that “a fast-spreading new strain of COVID-19” has popped up in Australia…
South Australia is battling a fast-spreading new strain of COVID-19 as it prepares for a six-day lockdown to attempt to contain the virus. A COVID-19 cluster in Adelaide’s north grew to 22 on Wednesday as thousands of people continued to flock to testing stations.
The reason why authorities decided to lock down all of South Australia for six days is because this new strain appears to be far more contagious than previous strains…
A strain of Covid-19 behind an outbreak in South Australia may be spreading up to five times quicker than normal, officials fear. Concerned health bosses say the incubation period — how long it takes for someone to show symptoms after getting infected — was ‘very very short’. Professor Nicola Spurrier, chief health officer for South Australia, claimed people are becoming contagious within 24 hours of catching the virus. She said the particular strain behind the outbreak had ‘certain characteristics’.
If it is true that this new strain spreads five times more rapidly than older strains, it could easily become dominant.
And if that happens, the vaccines that have been developed may not be of any use at all.
We are primarily funded by readers. Please subscribe and donate to support us!
We just don’t know at this point.
But what we do know is that COVID will continue to mutate in the months and years ahead, and that could potentially create massive headaches for vaccine developers.
As for the vaccines that have already been created, some experts are pointing out that there is so much that is unknown about them.
Most people assume that these new vaccines are similar to other vaccines that they have previously taken, but that is definitely not true.
These new vaccines are in an entirely new class all by themselves. They are known as “messenger RNA” (mRNA) vaccines, and they work by hijacking the protein-making machinery in your cells…
When Moderna was just finishing its Phase I trial, The Independent wrote about the vaccine and described it this way: “It uses a sequence of genetic RNA material produced in a lab that, when injected into your body, must invade your cells and hijack your cells’ protein-making machinery called ribosomes to produce the viral components that subsequently train your immune system to fight the virus.” “In this case, Moderna’s mRNA-1273 is programmed to make your cells produce the coronavirus’ infamous coronavirus spike protein that gives the virus its crown-like appearance (corona is crown in Latin) for which it is named,” wrote The Independent.
I certainly do not want my cells “hijacked”, and nobody has any idea what the long-term effects will look like.
And even if you take one of these new vaccines, it could end up doing no good for you at all if a different strain emerges and becomes dominant.
Unfortunately, I believe that we have entered an era of global pandemics, and I am convinced that all of this enthusiasm about the vaccines that have been developed is completely misguided.
We know that COVID will continue to mutate, but we have no idea at all if the current vaccines will be effective against those future strains or not.
If fighting diseases was easy, we would have eradicated the common cold and the flu long ago.
But we haven’t, and we won’t be eradicating COVID either.
Even now, dangerous new strains of COVID are emerging, and I have a feeling that it is going to be COVID that is going to have the last laugh.


investmentwatchblog--2020-11-19--Panic And Desperation Sweep Across America As Fears Of A “Dark Winter” Continue To Rise

Do you remember earlier this year when consumers were feverishly hoarding toilet paper and we were seeing colossal lines at food banks all over the nation during the initial stages of the COVID pandemic ?
Well , it is happening again .
Now that the vote on November 3rd is behind us , the pandemic has once again become the primary focus of the mainstream media , and a lot of people are completely freaking out .
Just like earlier this year , store shelves across the country are being emptied because Americans don ’ t want to be stuck @ @ @ @ @ @ @ hand sanitizer .
Each new restriction that gets announced adds to the frenzy , and it has gotten to the point where new restrictions are literally being announced around the nation on a daily basis now .
And if the case numbers that we are being given continue to rise , it is inevitable that this new wave of lockdowns will get even tighter .
Over the last several months , Joe Biden has repeatedly told us that we have a “ dark winter ” ahead .
Here is just one example… “ @ @ @ @ @ @ @ to fight this pandemic , ” Biden said in Delaware .
“ We ’ re still facing a very dark winter.
” Biden , whose campaign against President Donald Trump made the coronavirus a main focus , pledged to “ spare no effort to turn this pandemic around once we ’ re sworn in on Jan. 20.
” Technically , winter doesn ’ t start until a little over a month from now , but the panic shopping has already begun .
In California , supplies of toilet paper are being voraciously gobbled @ @ @ @ @ @ @ had already emptied the paper and cleaning aisle in a local Walmart by Wednesday morning .
Other storefronts , such as Trader Joes in the Silverlake neighborhood of Los Angeles and Ralphs on West 9th Street , were simply running low on such supplies .
A worker at a Costco in Los Angeles , who wished to remain anonymous , said the store was selling out of toilet paper every day , among other supplies , but also said that this could be attributed to the Thanksgiving holiday coming up next week .
@ @ @ @ @ @ @ over in Spokane , Washington… In fact , shortages are being reported all over the nation at this point .
I don ’ t know why there is such a focus on toilet paper .
To me , having enough food to eat for an extended period of time is much more of a priority , but when people get fearful they don ’ t necessarily think rationally .
And certainly there is a bit of psychology to all of this .
When people are told that there is a “ shortage ” @ @ @ @ @ @ @ feel motivated to run out and buy some too while they still can .
The panic buying has reached such a frenzy that many large chains are once again starting to put purchase limits on certain items .
The following comes from CNN… At Kroger ( KR ) , customers can purchase a maximum of two items when it comes to products like bath tissue , paper towels , disinfecting wipes and hand soap .
Giant , a grocery chain in the Northeast , recently put a limit of one on purchases of @ @ @ @ @ @ @ and four on smaller toilet paper and paper towel sizes .
H-E-B in Texas has implemented similar policies in recent weeks .
Some H-E-B stores have instituted limits of two on purchases of disinfecting and antibacterial sprays , while other stores have limited toilet paper and paper towels to two .
This is just one of the reasons why I have always encouraged my readers to get prepared in advance .
If you have a large family , how long is two packages of toilet paper going to last you ?
You could @ @ @ @ @ @ @ limiting family members to a certain number of squares per defecation , but you will still run out very quickly .
When you try to prepare for any emergency at the last minute , you are almost certainly going to fall short .
One or two trips to the grocery store is not going to cut it , and anyone that thinks otherwise is simply being delusional .
Meanwhile , the decline in economic activity around the nation that is being caused by this new round of lockdowns is creating a renewed surge @ @ @ @ @ @ @ day I wrote about how some people were waiting in line for up to 12 hours to get handouts from a food bank in Texas , and on Wednesday it was being reported that “ hundreds of cars ” were lined up to get food in Miami… Sadly , the truth is that this is happening all over the nation , and this new round of lockdowns will continue to make things even worse as we head into 2021 .
In so many instances , the people waiting in line at these food @ @ @ @ @ @ @ are driving very nice vehicles .
This severe economic downturn has come upon them very “ suddenly ” , but those that have been reading my books were warned in advance that this exact scenario was coming .
Even if this pandemic disappeared tomorrow , I would still believe that we have a “ very dark winter ” in front of us .
If you have not prepared for the extremely challenging times that lie ahead , I would very strongly urge you to do so .
So far this year we have @ @ @ @ @ @ @ another , and the “ perfect storm ” that started in 2020 is only going to intensify during the coming months .

by Michael Snyder
Do you remember earlier this year when consumers were feverishly hoarding toilet paper and we were seeing colossal lines at food banks all over the nation during the initial stages of the COVID pandemic? Well, it is happening again. Now that the vote on November 3rd is behind us, the pandemic has once again become the primary focus of the mainstream media, and a lot of people are completely freaking out. Just like earlier this year, store shelves across the country are being emptied because Americans don’t want to be stuck at home without enough toilet paper and hand sanitizer. Each new restriction that gets announced adds to the frenzy, and it has gotten to the point where new restrictions are literally being announced around the nation on a daily basis now. And if the case numbers that we are being given continue to rise, it is inevitable that this new wave of lockdowns will get even tighter.
Over the last several months, Joe Biden has repeatedly told us that we have a “dark winter” ahead. Here is just one example…
“There is a need for bold action to fight this pandemic,” Biden said in Delaware. “We’re still facing a very dark winter.” Biden, whose campaign against President Donald Trump made the coronavirus a main focus, pledged to “spare no effort to turn this pandemic around once we’re sworn in on Jan. 20.”
Technically, winter doesn’t start until a little over a month from now, but the panic shopping has already begun.
In California, supplies of toilet paper are being voraciously gobbled up by fearful consumers…
Shoppers in Temecula had already emptied the paper and cleaning aisle in a local Walmart by Wednesday morning. Other storefronts, such as Trader Joes in the Silverlake neighborhood of Los Angeles and Ralphs on West 9th Street, were simply running low on such supplies. A worker at a Costco in Los Angeles, who wished to remain anonymous, said the store was selling out of toilet paper every day, among other supplies, but also said that this could be attributed to the Thanksgiving holiday coming up next week.
Similar panic buying appears to be happening over in Spokane, Washington…
In a tweet on Sunday afternoon, KREM photojournalist Roger Hatcher said Target in Spokane Valley was “pretty quiet” but its toilet paper shelves were bare.
In fact, shortages are being reported all over the nation at this point.
I don’t know why there is such a focus on toilet paper. To me, having enough food to eat for an extended period of time is much more of a priority, but when people get fearful they don’t necessarily think rationally.
And certainly there is a bit of psychology to all of this. When people are told that there is a “shortage” of something, many of them inevitably feel motivated to run out and buy some too while they still can. The panic buying has reached such a frenzy that many large chains are once again starting to put purchase limits on certain items. The following comes from CNN…
At Kroger (KR), customers can purchase a maximum of two items when it comes to products like bath tissue, paper towels, disinfecting wipes and hand soap. Giant, a grocery chain in the Northeast, recently put a limit of one on purchases of larger toilet paper and paper towel sizes and four on smaller toilet paper and paper towel sizes. H-E-B in Texas has implemented similar policies in recent weeks. Some H-E-B stores have instituted limits of two on purchases of disinfecting and antibacterial sprays, while other stores have limited toilet paper and paper towels to two.
This is just one of the reasons why I have always encouraged my readers to get prepared in advance.
We are primarily funded by readers. Please subscribe and donate to support us!
If you have a large family, how long is two packages of toilet paper going to last you?
You could try to stretch out your supplies by limiting family members to a certain number of squares per defecation, but you will still run out very quickly.
When you try to prepare for any emergency at the last minute, you are almost certainly going to fall short. One or two trips to the grocery store is not going to cut it, and anyone that thinks otherwise is simply being delusional.
Meanwhile, the decline in economic activity around the nation that is being caused by this new round of lockdowns is creating a renewed surge in economic desperation.
Just the other day I wrote about how some people were waiting in line for up to 12 hours to get handouts from a food bank in Texas, and on Wednesday it was being reported that “hundreds of cars” were lined up to get food in Miami…
Huge lines have been forming at a Florida food bank ahead of Thanksgiving and as the coronavirus pandemic worsened across the United States. Hundreds of cars were spotted queuing for food boxes at Miami’s Gwen Cherry Park on Wednesday. The boxes were being distributed by the Miami Marlins Foundation amid the ongoing COVID-19 pandemic that has forced thousands of Floridians out of work.
Sadly, the truth is that this is happening all over the nation, and this new round of lockdowns will continue to make things even worse as we head into 2021.
In so many instances, the people waiting in line at these food banks are wearing very nice clothes and are driving very nice vehicles. This severe economic downturn has come upon them very “suddenly”, but those that have been reading my books were warned in advance that this exact scenario was coming.
Even if this pandemic disappeared tomorrow, I would still believe that we have a “very dark winter” in front of us. If you have not prepared for the extremely challenging times that lie ahead, I would very strongly urge you to do so.
So far this year we have been hit by one major crisis after another, and the “perfect storm” that started in 2020 is only going to intensify during the coming months.


investmentwatchblog--2020-11-20--Small Traders vs Large Traders vs Commercials: Who’s Right Most Often? | Elliott Wave International

The Commodity Futures Trading Commission monitors three groups of participants in commodity markets .
Learn why one of these three @ @ @ @ @ side of markets at key price turns and what this means for investors at this @ @ @

The Commodity Futures Trading Commission monitors three groups of participants in commodity markets. Learn why one of these three is usually on the correct side of markets at key price turns and what this means for investors at this particular juncture.
We are primarily funded by readers. Please subscribe and donate to support us!


investmentwatchblog--2020-11-20--The hidden bull market – Follow the kuroda boys and sell the open

The hidden bull market
Follow the kuroda boys and sell the open pic.twitter.com/gUTP9iIgYo
— Alessio Urban (@AlessioUrban) November 19, 2020


investmentwatchblog--2020-11-20--JPM says that its card users are starting to show similar behaviors as they were in March.

JPM says that its card users are starting to show similar behaviors as they were in March .
Spending more @ @ @ @ @ less on restaurants/entertainment .
But it notes the magnitude of the swings are smaller than @ @ @ @ @ .
pic.twitter.com/7QNd1XPtIq “ Retailers giving up rights to landlords in exchange for big rent reductions…at @ @ @ @ @ who saw strong online sales in recent months may decide they don ’ t need @ @ @ @ @ wanted ” t.co/MPx7lfpDIj Worrisome on several accounts , including the potential for the following vicious @ @ @ @ @ undetected # Covid infections and hospitalization rise and Test and trace systems are then completely @ @ @ @ @ their effectiveness .
pic.twitter.com/hxuA6QKPUr

JPM says that its card users are starting to show similar behaviors as they were in March. Spending more at grocery/discount stores. Spending less on restaurants/entertainment. But it notes the magnitude of the swings are smaller than what we saw back then. pic.twitter.com/7QNd1XPtIq
“Retailers giving up rights to landlords in exchange for big rent reductions…at the same time, retailers who saw strong online sales in recent months may decide they don’t need all the stores/markets they once wanted” t.co/MPx7lfpDIj
Worrisome on several accounts, including the potential for the following vicious cycle:
Testing falls behind
More spreaders go undetected#Covid infections and hospitalization rise and
Test and trace systems are then completely overwhelmed, losing much of their effectiveness. pic.twitter.com/hxuA6QKPUr
— Mohamed A. El-Erian (@elerianm) November 19, 2020


investmentwatchblog--2020-11-20--MAD world! #China issued 5y notes this week at a yield of -0.152%, 1st time it has managed to borrow

MAD world !
# China issued 5y notes this week at a yield of -0.152 % , 1st time it @ @ @ @ @ negative interest rates .
Investors placed total orders of about €18bn as investors seems to @ @ @ @ @ .
t.co/v87CirEOb7 pic.twitter.com/LEYzA3o6mY

MAD world! #China issued 5y notes this week at a yield of -0.152%, 1st time it has managed to borrow at negative interest rates. Investors placed total orders of about €18bn as investors seems to want more exposure to China. t.co/v87CirEOb7 pic.twitter.com/LEYzA3o6mY
— Holger Zschaepitz (@Schuldensuehner) November 19, 2020


investmentwatchblog--2020-11-20--Middle East Oil Producers Are Drowning In Debt

Arab Gulf oil producers are losing billions of U.S. dollars from oil revenues this year due to the pandemic that crippled oil demand and oil prices .
Because of predominantly oil-dependent government incomes , budget deficits across the region are soaring .
Middle East ’ s oil exporters rushed to raise taxes and cut spending earlier this year , but these measures were insufficient to contain the damage .
The major oil producers in the Gulf then rushed to raise debt via sovereign and corporate debt issuance .
Bond issues in the region have already hit US $ 100 billion @ @ @ @ @ @ @ bonds issued in 2019 .
Thanks to low-interest rates and high appetite from investors , the petrostates are binging on debt raising to try to fill the widening gaps in their balance sheets that oil prices well below their fiscal break-evens leave .
One of the latest issuers is none other than the biggest oil company in the world , Saudi Arabia ’ s oil giant Aramco , which raised this week as much as US $ 8 billion in multi-tranche bonds .
Aramco is tapping the international U.S.-denominated bond market for the @ @ @ @ @ @ @ last year ’ s US $ 12 billion bond issue in its first international issuance , for which it had received more than US $ 100 billion in orders .
Saudi Aramco prefers to considerably increase its debt to cope with the oil price collapse than to touch its massive annual dividend of US $ 75 billion , the overwhelming majority of which goes to its largest shareholder with 98 percent , the Kingdom of Saudi Arabia .
Analysts warn that the dividend windfall from Aramco will not be enough to contain Saudi @ @ @ @ @ @ @ oil prices stay in the low $ 40s for a few more years .
The massive dividend of Aramco can not fund the widening budget gap of Saudi Arabia if oil prices remain low beyond 2021 , Moody ’ s said last month .
The Saudi budget depends to a large extent on the royalties , taxes , and of course , the dividend from Saudi Aramco .
The Saudi oil giant ’ s new debt is the latest in a series of sovereign and corporate bond issuances this year , with which @ @ @ @ @ @ @ budgets to compensate for crumbling oil revenues .
Abu Dhabi , the emirate holding nearly all of the oil reserves of the United Arab Emirates ( UAE ) , issued a US $ 5-billion bond in September , with one tranche of it maturing in 50 years—the longest term for a bond issued by a sovereign issuer in the Gulf Cooperation Council ( GCC ) , which also includes Bahrain , Kuwait , Oman , Qatar , and Saudi Arabia .
Abu Dhabi ’ s latest issue was the third bond issue this @ @ @ @ @ @ @ raised in the spring .
Another UAE emirate , Dubai , issued US $ 2 billion in bonds in September , its first since 2014 .
The sovereign bond binge began with Qatar in early April , when it raised US $ 10 billion in tranches of five , 10 , and 30 years .
Oman and Bahrain , whose finances are on a more precarious footing than those of the larger oil producers in the region , also tapped bond markets this year .
Loading on debt currently looks like a good @ @ @ @ @ @ @ Middle East oil producers—it allows them to plug some of the shortfall without further escalating the already tough austerity measures , which could be highly unpopular in the oil monarchies .
However , the debt binge will come to an end sooner or later , and the Gulf oil economies will find themselves in an all-too-familiar position .
They will hope and desperately aim , again , for higher oil prices that would help them strengthen their finances and credit ratings in order to be able to refinance debt or issue new debt @ @ @ @ @ @ @ debt would likely delay all those promised oil-dependency-reducing reforms in the region , too .
The oil-producing nations in the Middle East will continue to depend on oil revenues and , by extension , on the price of oil in the future , regardless of all the plans , pledges , and priorities to boost their non-oil economies and reduce their dependence on the volatile nature of the crude oil commodity .
Gulf Arab producers continue to believe that they will outlast U.S. shale and all other higher-cost oil producers and will be @ @ @ @ @ @ @ barrel of oil on earth .
This belief seems to reinforce the current modus operandi of the Middle East oil nations—borrow now and think of debt loads and reforms later .
The Gulf oil producers are now actively managing supply to the oil market after demand crashed in the pandemic .
Yet , in the near to medium term , higher oil prices will depend on the pace of demand recovery .
The sooner the market balances , the sooner the Middle East petrostates may be able to breathe a sigh of relief @ @ @ @ @ @ @ .
However , as previous cycles have shown , higher oil prices could once again make Gulf producers complacent and slow to reform economies to cut dependence on oil income .
The oil-exporting countries in the Middle East became rich and powerful because of oil , and they will never want to kill the goose that lays the golden egg .

By Tsvetana Paraskova
Arab Gulf oil producers are losing billions of U.S. dollars from oil revenues this year due to the pandemic that crippled oil demand and oil prices. Because of predominantly oil-dependent government incomes, budget deficits across the region are soaring.
Middle East’s oil exporters rushed to raise taxes and cut spending earlier this year, but these measures were insufficient to contain the damage.
The major oil producers in the Gulf then rushed to raise debt via sovereign and corporate debt issuance. Bond issues in the region have already hit US$100 billion, exceeding the previous record amount of bonds issued in 2019.
Thanks to low-interest rates and high appetite from investors, the petrostates are binging on debt raising to try to fill the widening gaps in their balance sheets that oil prices well below their fiscal break-evens leave.
Saudi Aramco Taps International Debt Market Again
One of the latest issuers is none other than the biggest oil company in the world, Saudi Arabia’s oil giant Aramco, which raised this week as much as US$8 billion in multi-tranche bonds.
Aramco is tapping the international U.S.-denominated bond market for the second time in two years, after last year’s US$12 billion bond issue in its first international issuance, for which it had received more than US$100 billion in orders.
Saudi Aramco prefers to considerably increase its debt to cope with the oil price collapse than to touch its massive annual dividend of US$75 billion, the overwhelming majority of which goes to its largest shareholder with 98 percent, the Kingdom of Saudi Arabia.
Analysts warn that the dividend windfall from Aramco will not be enough to contain Saudi Arabia’s widening budget deficit if oil prices stay in the low $40s for a few more years.
The massive dividend of Aramco cannot fund the widening budget gap of Saudi Arabia if oil prices remain low beyond 2021, Moody’s said last month.
The Saudi budget depends to a large extent on the royalties, taxes, and of course, the dividend from Saudi Aramco.
Bond Issuance Binge in the Middle East
The Saudi oil giant’s new debt is the latest in a series of sovereign and corporate bond issuances this year, with which Middle Eastern producers hope to fund their budgets to compensate for crumbling oil revenues.
We are primarily funded by readers. Please subscribe and donate to support us!
Abu Dhabi, the emirate holding nearly all of the oil reserves of the United Arab Emirates (UAE), issued a US$5-billion bond in September, with one tranche of it maturing in 50 years—the longest term for a bond issued by a sovereign issuer in the Gulf Cooperation Council (GCC), which also includes Bahrain, Kuwait, Oman, Qatar, and Saudi Arabia. Abu Dhabi’s latest issue was the third bond issue this year, following US$10 billion raised in the spring.
Another UAE emirate, Dubai, issued US$2 billion in bonds in September, its first since 2014.
The sovereign bond binge began with Qatar in early April, when it raised US$10 billion in tranches of five, 10, and 30 years.
Oman and Bahrain, whose finances are on a more precarious footing than those of the larger oil producers in the region, also tapped bond markets this year.
How Sustainable Is Amassing Debt?
Loading on debt currently looks like a good way out of the crisis for the Middle East oil producers—it allows them to plug some of the shortfall without further escalating the already tough austerity measures, which could be highly unpopular in the oil monarchies.
However, the debt binge will come to an end sooner or later, and the Gulf oil economies will find themselves in an all-too-familiar position. They will hope and desperately aim, again, for higher oil prices that would help them strengthen their finances and credit ratings in order to be able to refinance debt or issue new debt at reasonable borrowing costs.
The mounting debt would likely delay all those promised oil-dependency-reducing reforms in the region, too.
The oil-producing nations in the Middle East will continue to depend on oil revenues and, by extension, on the price of oil in the future, regardless of all the plans, pledges, and priorities to boost their non-oil economies and reduce their dependence on the volatile nature of the crude oil commodity.
Gulf Arab producers continue to believe that they will outlast U.S. shale and all other higher-cost oil producers and will be the ones that will pump the last barrel of oil on earth.
This belief seems to reinforce the current modus operandi of the Middle East oil nations—borrow now and think of debt loads and reforms later.
The Gulf oil producers are now actively managing supply to the oil market after demand crashed in the pandemic. Yet, in the near to medium term, higher oil prices will depend on the pace of demand recovery. The sooner the market balances, the sooner the Middle East petrostates may be able to breathe a sigh of relief and enjoy the coveted higher oil prices.
However, as previous cycles have shown, higher oil prices could once again make Gulf producers complacent and slow to reform economies to cut dependence on oil income. The oil-exporting countries in the Middle East became rich and powerful because of oil, and they will never want to kill the goose that lays the golden egg.
By Tsvetana Paraskova for Oilprice.com


investmentwatchblog--2020-11-20--If you ever wonder why people on the left suffer from cognitive dissonance, this is why. Just one ex

If you ever wonder why people on the left suffer from cognitive dissonance, this is why. Just one example from CNN’s take on the legal team press conference. They label Trump’s claim as false but then go on to prove that he is right

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The image is real:
www.cnn.com/2020/11/19/politics/giuliani-trump-legal-team-press-briefing-fact-check/index.html
Note: This page has been archived.
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We are primarily funded by readers. Please subscribe and donate to support us!
h/t BorisWave