investmentwatchblog--2020-05-11--The 2010-2020 Liquidity-Fueled Asset Bubble

For this week ’ s DDDD ( data-driven DD ) , I ’ ll be going more in- depth about a post I made a month ago , where I showed evidence about the stock market being in a bubble , and what might happen in the near future to equity prices .
I ’ m not talking about the recent rise in equity prices during April , which was also driven by increased liquidity in combination with retail investors bringing valuations to euphoria-level prices ; this has been going on since at least 2010 .
Today , I ’ @ @ @ @ @ @ @ go into this bubble in asset prices , fueled by ten years of unsustainable increases in liquidity from the Fed , as well as everything you ’ ve never wanted to know about what liquidity is , how rich people in corporations store wealth , how money works , how securities are valued , the Monetarist school of economic thought , inflation , with a sprinkle of differential equations !
By the time you ’ re done reading this , you ’ ll be ready to pass the economics portion of your next @ @ @ @ @ @ @ know that since the stock market started crashing , the Fed has lowered their interest rates and started the regime of “ infinite quantitative easing ” .
This was in an effort to provide liquidity to effectively everyone .
What does this all mean , and how does this help the economy , why did the stock market go up because of this , and how long can this liquidity pumping last ?
First , what is liquidity ?
It ’ s the availability of liquid assets in an organization or economy .
@ @ @ @ @ @ @ is easily convertible to cash at the market price .
An easy way to look at the liquidity of an asset is looking at the bid-ask spread of it .
A treasury bond , for example , is very liquid and widely considered to be a “ cash equivalent ” , or in other words , the same as cash .
In fact , for organizations / people that hold a vast amount of wealth , they would probably hold more of their wealth in treasuries than cash ( or bank deposits ) @ @ @ @ @ @ @ later .
In contrast , a house is fairly illiquid .
It might take months to find a buyer , may have high transaction fees if you go through an agent , and the fair value of it is uncertain .
Okay , so how does the Fed ’ s policies affect liquidity ?
In general , a central bank will either be adopting an expansionary or contractionary monetary policy , meaning a goal of increasing or decreasing the supply of “ money ” in the system .
A key distinction here to @ @ @ @ @ @ @ does not necessarily mean “ cash ” .
There ’ s actually several official definitions and calculations of what counts as “ money ” , but all of them go with the notion of anything that can be considered “ cash equivalents ” , like bank deposits .
This means that the Fed doesn ’ t actually need to physically print more money ( i.e .
increasing M0 ) to increase the money supply and have the same effect .
To help explain this , let ’ s go through how money is @ @ @ @ @ @ @ Fed uses to increase the money supply .
Most money is created by banks in the form of debt .
Banks create money by accepting deposits from customers , and leveraging that money to create loans .
Suppose you decide to deposit $ 1000 into his checking account .
By law , up until last month when the Fed decided to take extreme measures to combat deflation , banks were required to hold a certain fraction of their deposits in cash or deposits in the bank ’ s own account in the Fed @ @ @ @ @ @ @ banks .
The idea is that on average , depositors won ’ t be withdrawing most of their money from their accounts anytime soon , so instead of having the liquidity sit idly at the bank or the Fed , it can be recycled back into the economy through loans and other financial securities , which can also become a revenue source for the bank .
How does the Fed play into this ?
They can influence the overnight rate , which is the interest rate banks lend money to each other overnight @ @ @ @ @ @ @ requirements .
In other words , banks with a surplus of money over their legally required reserve requirement will lend money to banks with a shortage at that rate .
This will naturally affect the amount of loans banks give and act as a floor to the interest rate available to consumers , as it wouldn ’ t make sense for banks to make loans at a lower interest rate than what they would receive from loaning to other banks on an overnight basis .
The Fed influences this rate by giving banks @ @ @ @ @ @ @ , usually at a premium of the “ target rate ” , as a last resort to prevent a liquidity crunch .
In this case , the bank will need to put up collateral , usually Treasury Securities ( although this has also changed recently ) , for this overnight loan .
In other words , the bank sells an acceptable collateral to the Fed with the agreement that the bank will repurchase that collateral for a slightly higher price the next day .
This mechanism is called a “ repurchase agreement ” @ @ @ @ @ @ @ the Fed indirectly controls the liquidity in the economy .
What can the Fed do after this rate reaches zero ( aside from going to negative rates like Japan / Europe ) ?
The other way the Fed can influence the money supply is by performing Open Market Operations , where they directly buy US treasuries for cash ; this is also known as expanding the Fed ’ s balance sheet .
Recently , this has expanded to many other things , including junk bonds .
Technically , the Fed itself doesn ’ @ @ @ @ @ @ @ they ’ re not able to take on credit risk .
Instead , the Fed created a taxpayer-funded Special Purpose Vehicle , whom it then lends money to for bond purchases .
So when Congress passed the CARES Act , it provided the Fed $ 454 billion , which they used to effectively establish an organization that will use the Fed to lever it up to $ 4 Trillion to buy whatever debt instruments they want , and lose up to $ 454 billion .
How does this affect things ?
Where the @ @ @ @ @ @ @ heard that there ’ s massive wealth inequality in the United States , with the top 1 % holding over 40 % of all wealth in 2019 .
Now , imagine if you were managing $ 1 Billion of assets , how would you store them ?
Doing what most normal people do , depositing into a bank account is dumb for many reasons .
Other than the fact that you ’ re only guaranteed $ 100,000 from FDIC per account if your bank happens to be insolvent , your $ 1 Billion @ @ @ @ @ @ @ Million in real value due to inflation .
So what do they store their wealth in ?
Stocks , Bonds ( Fixed Income ) and some Cash / Cash Equivalents ( mostly Treasuries ) .
Fixed Income and Treasuries are also how most public companies also store their extra capital .
Let ’ s look at Apple ’ s balance sheet in their most recent 10-K as an example .
Out of Apple ’ s $ 339 Billion of assets in 2019 , they had $ 205 Billion of them in financial instruments @ @ @ @ @ @ @ parts are that they had $ 12 Billion in actual cash , $ 50 Billion in government securities , and $ 85 Billion in corporate bonds .
Also they own $ 14 Billion of other people ’ s mortgages , cool .
So , what happens when a bunch of businesses are now forced to shut operations , your BBB-rated $ F or $ M bond gets downgraded , and you ’ re no longer sure which businesses will or won ’ t go bankrupt ?
Or what if you ’ re a @ @ @ @ @ @ @ to pay your expenses in the next few months ?
You sell your them , and that ’ s exactly what everyone did in March .
Cash and Cash Equivalents are now King .
Everyone is dumping their bonds , some of which aren ’ t even getting any bids when being sold , even briefly going into negative territory , and $ DXY ( representing the value of USD compared to other reserve currencies ) skyrockets .
Add on the fact that a substantial amount of non-US debt is denominated in US @ @ @ @ @ @ @ the world are trying to get their hands on USD to cover their debt payments with reduced revenue .
The skyrocketing corporate bond yields make it virtually impossible for companies , even the ones with strong balance sheets , to raise their much-needed cash to survive through bond issuance .
This is where the Fed steps in .
Their job is to prevent deflation at all costs , and a strengthening $ DXY is a sign that this might happen since that means it ’ s a lot cheaper to import things .
@ @ @ @ @ @ @ decline in CPI in March , although the collapse of oil prices also probably affected it .
The Fed then uses their SPV to buy bonds to stabilize the market and give investors confidence that they won ’ t be the bag holders .
They also use something called swap lines with foreign central banks to improve liquidity between currencies to help with the foreign debt problem .
This causes bond prices to go back up ( and yields to go back down ) , bailing out everyone that would have lost money @ @ @ @ @ @ @ s the kicker – this barely helps with fighting against deflation .
Inflation is measured by comparing the weighted average of prices for a basket of goods , representing the things an average consumer buys in a given year , and does not include financial assets .
Buying bonds and treasuries and lowering interest rates will only indirectly prevent deflation by preventing a complete freeze in lending by banks , and maybe by the wealth effect ( i.e .
becoming poorer will lead rich people to spend less money ) .
Instead , @ @ @ @ @ @ @ inflation – the inflation of asset prices .
The Fed pumping liquidity into the system is nothing new .
Since the 1980s , the Fed funds rate has been steadily decreasing towards zero , causing treasury and bond yields to follow it .
Investing is all about risk over reward .
In general , the US treasury is considered to be the safest possible investment ( risk free ) , and the yield of a 3-month US Treasury bill is the floor of all yields ( risk free rate ) .
In theory @ @ @ @ @ @ @ thus have a higher reward for that risk .
Thus , as the risk free rate goes down , investors now need to take on more risk to have the same reward , and financial instruments with the same risk will have lower rewards ( yields ) , bringing down bond yields .
This also means that equities that carry the same risk will also have lower “ yields ” .
Now , “ yield ” in equities is a bit complicated .
One way to calculate them is to just use the @ @ @ @ @ @ @ past few years companies realized it ’ ll be more tax-advantaged to do stock buybacks instead of paying dividends .
So , although not exactly the same concept , earnings over price would be the best metric to look at the equivalent of equity “ yields ” , or the reward investors will accept for the risk of investing in the stock .
There ’ s a lot more variation here because “ risk ” and “ reward ” in equities is much more variable and harder to assess compared to fixed income @ @ @ @ @ @ @ ratios have been on the rise since the 1980s , meaning investors are generally willing to take on a lower reward for the same amount of risk in the stock market .
How much longer can this last ?
Fed funds rates are already effectively stuck near zero ; even in the “ booming ” economy that we ’ ve had the past decade the Fed was barely able to raise the repo rate past 2 % before the stock market started crashing in late 2018 and was never able to meaningfully unwind @ @ @ @ @ @ @ easing they did in the Great Recession .
Now they ’ ve put their liquidity injection program on steroids with infinite QE .
They ’ ve reduced the risk of corporate bonds by saying they will be the bag holder if things go bad .
The key takeaway here is that increased liquidity from the Fed causes inflation of asset prices .
Hopefully , this isn ’ t new news to anyone , but now you hopefully understand why this happens .
How We Got Here – Inflation Targeting and Monetarism So how @ @ @ @ @ @ @ the Fed pumped so much liquidity to the economy ?
My own personal opinion is that this bubble was caused by the Fed ’ s indiscriminate inflation targeting .
Since 2012 , the Federal Reserve ’ s primary objective has been to have a target of a 2 % inflation rate , an increase from the 1.5 % target inflation from the early 2000s until 2012 .
The whole idea of inflation targeting is actually pretty new , with it being first discussed by the Fed in 1994 , where it was debated @ @ @ @ @ @ @ not it would be a good idea , and it didn ’ t really get implemented until the early 2000s .
Before then , the Fed just aimed for “ price stability ” .
Okay , so what causes inflation , and how is it calculated ?
The inflation rate is usually calculated by measuring the changes in the CPI , or Consumer Price Index .
CPI is an indexed weighted average basket of prices for goods and services that an average American household purchased for a given year .
There ’ s @ @ @ @ @ @ @ same concept but removes fuel and food from the equation , since they tend to be volatile .
There ’ s many theories out there about what drives inflation .
One of the most popular ones out there , and the one I personally believe , is Quantity Theory of Money .
The origin of QTM is actually pretty ancient , first proposed by the mathematician Copernicus back in 1517 , and has been accepted by economists ranging from Milton Friedman , Keynes , and even Karl Marx , although they all disagreed @ @ @ @ @ @ @ be emphasized .
Keynes ’ believed that it was determined by aggregate demand ( Q ) , Marx believed it was determined by the amount of goods in circulation ( also Q ) , and the Monetarist ’ s view led by Friedman , is that what determines inflation is the quantity of money in circulation ( M ) , and can be controlled by the Fed .
In other words , the Keynesian approach to controlling the economy was to focus on aggregate demand , usually through fiscal stimulus , while the @ @ @ @ @ @ @ money supply .
In its mathematical form , let ’ s look at the simplified Equation of Exchange .
M is the total nominal amount of money supply in the economy .
As mentioned above “ money ” can mean different things , but in here let ’ s say it ’ s the M2 money supply , which is all cash , checking and savings deposits and money market securities .
V is the velocity of the M2 money supply , which is the average amount of times a dollar is used @ @ @ @ @ @ @ within the economy .
P is the price level , which is basically CPI Q is the real value of all expenditures in an economy .
This is basically the same as GDP .
To see how this relates to inflation , we ’ re going to need to look at how the price changes with respect to time .
Time to add some calculus to this to look at the first time-derivative of P. Hand-written derivation of inflation from the Equation of Exchange I hand-wrote this because I was too lazy to @ @ @ @ @ @ @ usually cited version of this is to pretend velocity money is constant and not deal with calculus by using approximations for when changes are very small .
This results in ΔP = ΔM – ΔY , which is what you ’ ll see in most ECON101 textbooks .
The problem with this assumption is that velocity of money is not constant and this will not be reflected in long-term effects since this approximation only works for very small changes and neglects feedback loops .
Okay , so let ’ s look at my @ @ @ @ @ @ @ t read math , what it says is that the inflation rate • Increases with the rate of change in the money supply • Increases with the rate of change in the velocity of money • Decreases with the rate of change in the GDP • Higher velocity of money amplifies the effects of changes in money supply • Higher money supply amplifies the effects of changes in money velocity • Higher price levels amplifies the effects of changes in GDP • Decreases in GDP amplifies all changes in inflation Now , let @ @ @ @ @ @ @ Fed ’ s perspective .
This probably isn ’ t that reflective of the Fed ’ s actual decision making process but it ’ s one way of seeing how everything relates to each other , and all the other models ( eg .
IS-LM , AD-AS ) basically lead towards a similar conclusion .
The Fed wants to have a fixed inflation rate no matter what .
It ’ s extremely hard for both the Fed and federal government to control behaviors of consumers , and how quickly they spend money they @ @ @ @ @ @ @ sort of just a given .
GDP can somewhat be controlled by the governments through fiscal stimulus , by using deficits to fuel economic growth , although this isn ’ t sustainable if there ’ s no fundamental reason for increased productivity .
As I mentioned previously , this is probably the case and what we ’ ve been looking at for the past decade was a period of debt-fueled economic growth , and we would have seen stagnation if the government hadn ’ t grown deficits in the past decade .
From @ @ @ @ @ @ @ thing it can control is money supply , but this usually needs to be done slowly and carefully .
Dramatic changes in prices will amplify the effects of any GDP changes due to inflation , causing even more dramatic changes to price levels as well as decreased GDP due to economic uncertainty from unpredictable price levels – hyperinflation , or deflationary spiral .
You also don ’ t want to suddenly massively increase your money supply because this will amplify any effects increased money velocity has on inflation .
Increased inflation will also @ @ @ @ @ @ @ spending money as soon as they receive it .
Also hyperinflation .
Mathematically , the equation stated above is a first-order differential equation on every variable , meaning it ’ s full of positive feedback – specifically positive feedback loops .
So what do we see happening since 2000 ?
• A dramatic drop in the velocity of money from the 1997 peak of 2.2 per quarter to 1.3 in Q12020 .
The falling velocity of money is most likely attributed by the slow rise in income inequality in North America , and @ @ @ @ @ @ @ to consume ( i.e .
every extra dollar , they will more likely invest / save it rather then spend it on consumption ) , this reduced the number of times dollars get spent .
Clearly , the inflationary effects of slower GDP growth is far exceeded by reduced velocity of money .
This is actually usually the case , and it ’ s why you usually see deflation rather than inflation for most stagnating developed economies ( eg .
Europe and Japan ) .
Because of positive feedback loops , when this @ @ @ @ @ @ @ to escape and is called a deflationary spiral .
To combat the deflationary pressure and maintain the same inflation rate as the 1990s , the only thing the Fed can do is increase monetary supply , using the mechanisms described .
Up until 2008 , the primary mechanism was lowering interest rates , which inflates the money supply through lending .
The new money supply , through loans , would be mostly issued for consumption , like a mortgage to buy a new house or a new car loan to buy a car @ @ @ @ @ @ @ of increasing velocity of money because this new money supply is recycled into the economy .
After 2008 , the Fed had to find a new mechanism , with interest rates being permanently too close to zero to have any meaningful impact on the money supply to actually help anything , especially since most Fed board members think that negative interest rates are a bad idea .
With quantitative easing , direct purchases of treasuries artificially lowers the yields of treasuries and makes bonds and equities relatively more attractive when looking at risk @ @ @ @ @ @ @ securities .
We ’ ve effectively reached 0 % yield on the risk-free-rate during the last crisis , so the next logical step for the Fed was to buy other securities , like commercial paper and now bonds .
Except , as shown earlier , the biggest holders of treasuries and bonds were actually corporations and high-net-worth individuals , who compared to regular people have a much lower propensity to consume , and would not at all address the lowering velocity of money .
It also leads towards higher wealth inequality , as @ @ @ @ @ @ @ and all other financial assets which are concentrated at the top corporations and individuals , which tends to be bad for velocity of money .
In simplified terms , the increase in money supply goes towards the people who already held a lot of wealth .
This is probably why we ’ re seeing a steep drop-off of money velocity after 2008 , even after the economy has recovered .
Velocity of Money in an Pandemic A pandemic and lockdown brings a whole new level of challenges in maintaining this delicate balance .
@ @ @ @ @ @ @ rapidly with the economic shock .
Although we don ’ t have definitive data on this yet , it ’ s pretty clear that this lockdown will see a sudden and dramatic decrease in money changing hands .
At the same time , we ’ re going to see the biggest sudden drop in GDP in history – at the scale of the Great Depression but occurring in the span of months .
To add to the shit show , oil prices are in an absolute mess , adding even more downwards pressure @ @ @ @ @ @ @ trying to fine tune this economic machine to balance .
The positive feedback loops mean that if they ’ re not able to expand the supply of money enough , we ’ ll quickly see a deflationary spiral .
If they do too much , we quickly get into hyperinflation .
As the world ’ s reserve currency , and having the vast majority of countries in the world being short dollars , with debt denominated in USD , it ’ ll be virtually impossible to see hyperinflation .
The Fed has pretty @ @ @ @ @ @ @ have possibly done to keep inflation at 2 % by increasing the money supply using tools they ’ re allowed to use .
Interest rates and the risk free rate have been near 0 % since 2008 , and bond yields are already at unrealistic levels for the amount of risk they have , resulting in a skyrocketing increase in equities .
Since none of these actually address the velocity of money issue , which has likely sharply decreased since March , we ’ re probably going to head towards a deflationary spiral @ @ @ @ @ @ @ prices ?
We ’ ve seen this exact scenario play out in Japan during the 1990s and parts of Europe in the 2010s , and counterintuitively , we see an L shaped recovery economically and a collapse of equity prices .
I already talked about this extensively so you can read that if you want to know more about it .
What was my point again ( TLDR ) ?
Wow that was long .
Let ’ s go over everything in here • Money is usually created from banks issuing credit .
@ @ @ @ @ @ @ of wealth in treasuries and bonds as a vehicle to preserve wealth .
• Everyone was trying to get their hands on dollars in March , especially internationally where many debts are denominated in USD • Fed ’ s actions lowers the “ risk free rate ” , which is used in valuations of securities .
This changes the risk / reward desired by investors for other securities and causes those prices to increase .
They ’ ve artificially deflated yields ( i.e .
reward / risk ) of bonds in March , @ @ @ @ @ @ @ Since the 2000s , the Fed has started targeting a specific interest rate .
• Velocity of money , caused by increasing wealth inequality in individuals and businesses in the US , has been steadily decreasing since the 2000s .
• Decreased money velocity , with stagnating GDP , means the Fed has to increase the money supply with liquidity to keep inflation at the desired level .
Positive feedback loops means that they need an increasing amount of liquidity to have the same effect .
• Increasing liquidity through money supply increases @ @ @ @ @ @ @ .
• Even though this has been happening since the 2000s , a lockdown just accelerates this process .
• Fed probably can ’ t do anything else to stop a deflationary spiral , which is where we ’ re headed .
• Japan and parts of Europe had something similar happen a few years ago , and it didn ’ t end up well .
I just want to know if I should buy SPY calls or puts See my short term thesis from two weeks ago ( tldr – SPY will @ @ @ @ @ @ @ a few weeks ) , and last week ’ s post , where I talked about the declining momentum of the bullish sentiment ( tldr – 293 ( +- 2 % ) was the top , going to see a reversal soon ) .
I ’ ll also be updating this post with my live thoughts / moves for this week , for those who care and like reading about what other people do .
For this week overall , I ’ m looking for re-confirmation of my thesis with the following events @ @ @ @ @ @ @ reaching 293 ( +- 2 % ) • SPY falling past 278 , which is the 50 % Fib level where we reversed off over a week ago .
This will open up 274 and form a double-top bearish signal .
5/10 10:30PM – /ES at 2945 , near the upper limit allowed by my thesis .
15m and 1h are overbought on RSI , so expecting it to not move past this level and move back down to ~2930 when market opens tomorrow .
5/11 2AM – /ES back right underneath 2930 @ @ @ @ @ @ @ .
Looking good for my short-term thesis so far 5/11 Market Open – SPY opened at 290 , reversing off of 293 from Friday .
/ES hourly has a bearish MACD on 1H so we might so SPY slowly go down below 289 today .
If that happens my short-term thesis is re-confirmed .
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 .

by ASoftEngStudent
For this week’s DDDD (data-driven DD), I’ll be going more in- debt depth about a post I made a month ago, where I showed evidence about the stock market being in a bubble, and what might happen in the near future to equity prices. I’m not talking about the recent rise in equity prices during April, which was also driven by increased liquidity in combination with retail investors bringing valuations to euphoria-level prices; this has been going on since at least 2010. Today, I’ll be going in-depth about how we go into this bubble in asset prices, fueled by ten years of unsustainable increases in liquidity from the Fed, as well as everything you’ve never wanted to know about what liquidity is, how rich people in corporations store wealth, how money works, how securities are valued, the Monetarist school of economic thought, inflation, with a sprinkle of differential equations! By the time you’re done reading this, you’ll be ready to pass the economics portion of your next CFA level III exam.
What “Liquidity” means
We all know that since the stock market started crashing, the Fed has lowered their interest rates and started the regime of “infinite quantitative easing”. This was in an effort to provide liquidity to effectively everyone. What does this all mean, and how does this help the economy, why did the stock market go up because of this, and how long can this liquidity pumping last?
First, what is liquidity? It’s the availability of liquid assets in an organization or economy. A liquid asset is an asset that is easily convertible to cash at the market price. An easy way to look at the liquidity of an asset is looking at the bid-ask spread of it. A treasury bond, for example, is very liquid and widely considered to be a “cash equivalent”, or in other words, the same as cash. In fact, for organizations / people that hold a vast amount of wealth, they would probably hold more of their wealth in treasuries than cash (or bank deposits). We’ll go over that later. In contrast, a house is fairly illiquid. It might take months to find a buyer, may have high transaction fees if you go through an agent, and the fair value of it is uncertain.
Okay, so how does the Fed’s policies affect liquidity? In general, a central bank will either be adopting an expansionary or contractionary monetary policy, meaning a goal of increasing or decreasing the supply of “money” in the system. A key distinction here to point out is that “money” does not necessarily mean “cash”. There’s actually several official definitions and calculations of what counts as “money”, but all of them go with the notion of anything that can be considered “cash equivalents”, like bank deposits. This means that the Fed doesn’t actually need to physically print more money (i.e. increasing M0) to increase the money supply and have the same effect. To help explain this, let’s go through how money is created and the most common mechanisms the Fed uses to increase the money supply.
How the Fed creates liquidity
Most money is created by banks in the form of debt. Banks create money by accepting deposits from customers, and leveraging that money to create loans. Suppose you decide to deposit $1000 into his checking account. By law, up until last month when the Fed decided to take extreme measures to combat deflation, banks were required to hold a certain fraction of their deposits in cash or deposits in the bank’s own account in the Fed, who acts as the bank for banks. The idea is that on average, depositors won’t be withdrawing most of their money from their accounts anytime soon, so instead of having the liquidity sit idly at the bank or the Fed, it can be recycled back into the economy through loans and other financial securities, which can also become a revenue source for the bank.
How does the Fed play into this? They can influence the overnight rate, which is the interest rate banks lend money to each other overnight to make sure they meet their reserve requirements. In other words, banks with a surplus of money over their legally required reserve requirement will lend money to banks with a shortage at that rate. This will naturally affect the amount of loans banks give and act as a floor to the interest rate available to consumers, as it wouldn’t make sense for banks to make loans at a lower interest rate than what they would receive from loaning to other banks on an overnight basis. The Fed influences this rate by giving banks an option to borrow from them directly, usually at a premium of the “target rate”, as a last resort to prevent a liquidity crunch. In this case, the bank will need to put up collateral, usually Treasury Securities (although this has also changed recently), for this overnight loan. In other words, the bank sells an acceptable collateral to the Fed with the agreement that the bank will repurchase that collateral for a slightly higher price the next day. This mechanism is called a “repurchase agreement” or repo and is the primary way the Fed indirectly controls the liquidity in the economy. What can the Fed do after this rate reaches zero (aside from going to negative rates like Japan / Europe)?

Fed Funds Rate
The other way the Fed can influence the money supply is by performing Open Market Operations, where they directly buy US treasuries for cash; this is also known as expanding the Fed’s balance sheet. Recently, this has expanded to many other things, including junk bonds. Technically, the Fed itself doesn’t directly buy these bonds, since they’re not able to take on credit risk. Instead, the Fed created a taxpayer-funded Special Purpose Vehicle, whom it then lends money to for bond purchases. So when Congress passed the CARES Act, it provided the Fed $454 billion, which they used to effectively establish an organization that will use the Fed to lever it up to $4 Trillion to buy whatever debt instruments they want, and lose up to $454 billion. How does this affect things?
Fed Balance Sheet
Where the real money is
We’ve all heard that there’s massive wealth inequality in the United States, with the top 1% holding over 40% of all wealth in 2019. Now, imagine if you were managing $1 Billion of assets, how would you store them? Doing what most normal people do, depositing into a bank account is dumb for many reasons. Other than the fact that you’re only guaranteed $100,000 from FDIC per account if your bank happens to be insolvent, your $1 Billion is going to lose about $20 Million in real value due to inflation. So what do they store their wealth in? Stocks, Bonds (Fixed Income) and some Cash / Cash Equivalents (mostly Treasuries).
Assets held by high net worth individuals
Fixed Income and Treasuries are also how most public companies also store their extra capital. Let’s look at Apple’s balance sheet in their most recent 10-K as an example.
Apple Balance Sheet, Fiscal Year 2019
Breakdown of Cash & Securities owned by Apple
Out of Apple’s $339 Billion of assets in 2019, they had $205 Billion of them in financial instruments. Of that amount, the relevant parts are that they had $12 Billion in actual cash, $50 Billion in government securities, and $85 Billion in corporate bonds. Also they own $14 Billion of other people’s mortgages, cool.
So, what happens when a bunch of businesses are now forced to shut operations, your BBB-rated $F or $M bond gets downgraded, and you’re no longer sure which businesses will or won’t go bankrupt? Or what if you’re a business that suddenly finds yourself needing cash to pay your expenses in the next few months? You sell your them, and that’s exactly what everyone did in March. Cash and Cash Equivalents are now King.
BAA bond yields, 2019 – 2020
DXY, Daily
Everyone is dumping their bonds, some of which aren’t even getting any bids when being sold, even briefly going into negative territory, and $DXY (representing the value of USD compared to other reserve currencies) skyrockets. Add on the fact that a substantial amount of non-US debt is denominated in US dollars, meaning governments and corporations around the world are trying to get their hands on USD to cover their debt payments with reduced revenue. The skyrocketing corporate bond yields make it virtually impossible for companies, even the ones with strong balance sheets, to raise their much-needed cash to survive through bond issuance.
This is where the Fed steps in. Their job is to prevent deflation at all costs, and a strengthening $DXY is a sign that this might happen since that means it’s a lot cheaper to import things. In fact we saw a 0.4% decline in CPI in March, although the collapse of oil prices also probably affected it. The Fed then uses their SPV to buy bonds to stabilize the market and give investors confidence that they won’t be the bag holders. They also use something called swap lines with foreign central banks to improve liquidity between currencies to help with the foreign debt problem. This causes bond prices to go back up (and yields to go back down), bailing out everyone that would have lost money from the crash.
Now here’s the kicker – this barely helps with fighting against deflation. Inflation is measured by comparing the weighted average of prices for a basket of goods, representing the things an average consumer buys in a given year, and does not include financial assets. Buying bonds and treasuries and lowering interest rates will only indirectly prevent deflation by preventing a complete freeze in lending by banks, and maybe by the wealth effect (i.e. becoming poorer will lead rich people to spend less money). Instead, what we see is another sort of inflation – the inflation of asset prices.
How liquidity inflated asset prices
The Fed pumping liquidity into the system is nothing new. Since the 1980s, the Fed funds rate has been steadily decreasing towards zero, causing treasury and bond yields to follow it.
AAA bond yields, 1980 – 2020
Investing is all about risk over reward. In general, the US treasury is considered to be the safest possible investment (risk free), and the yield of a 3-month US Treasury bill is the floor of all yields (risk free rate). In theory, all other investments are riskier and thus have a higher reward for that risk. Thus, as the risk free rate goes down, investors now need to take on more risk to have the same reward, and financial instruments with the same risk will have lower rewards (yields), bringing down bond yields. This also means that equities that carry the same risk will also have lower “yields”.
Now, “yield” in equities is a bit complicated. One way to calculate them is to just use the dividend yield. However, in the past few years companies realized it’ll be more tax-advantaged to do stock buybacks instead of paying dividends. So, although not exactly the same concept, earnings over price would be the best metric to look at the equivalent of equity “yields”, or the reward investors will accept for the risk of investing in the stock.
Shiller PE Ratio
There’s a lot more variation here because “risk” and “reward” in equities is much more variable and harder to assess compared to fixed income, but we can see that P/E ratios have been on the rise since the 1980s, meaning investors are generally willing to take on a lower reward for the same amount of risk in the stock market.
How much longer can this last? Fed funds rates are already effectively stuck near zero; even in the “booming” economy that we’ve had the past decade the Fed was barely able to raise the repo rate past 2% before the stock market started crashing in late 2018 and was never able to meaningfully unwind their balance sheet from all the quantitative easing they did in the Great Recession. Now they’ve put their liquidity injection program on steroids with infinite QE. They’ve reduced the risk of corporate bonds by saying they will be the bag holder if things go bad.
The key takeaway here is that increased liquidity from the Fed causes inflation of asset prices. Hopefully, this isn’t new news to anyone, but now you hopefully understand why this happens.
How We Got Here – Inflation Targeting and Monetarism
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So how did we get here? Why has the Fed pumped so much liquidity to the economy? My own personal opinion is that this bubble was caused by the Fed’s indiscriminate inflation targeting. Since 2012, the Federal Reserve’s primary objective has been to have a target of a 2% inflation rate, an increase from the 1.5% target inflation from the early 2000s until 2012. The whole idea of inflation targeting is actually pretty new, with it being first discussed by the Fed in 1994, where it was debated extensively for multiple years on whether or not it would be a good idea, and it didn’t really get implemented until the early 2000s. Before then, the Fed just aimed for “price stability”.
Changes in CPI, 1950 – 2020
Okay, so what causes inflation, and how is it calculated? The inflation rate is usually calculated by measuring the changes in the CPI, or Consumer Price Index. CPI is an indexed weighted average basket of prices for goods and services that an average American household purchased for a given year. There’s also core CPI, which is the same concept but removes fuel and food from the equation, since they tend to be volatile.
There’s many theories out there about what drives inflation. One of the most popular ones out there, and the one I personally believe, is Quantity Theory of Money. The origin of QTM is actually pretty ancient, first proposed by the mathematician Copernicus back in 1517, and has been accepted by economists ranging from Milton Friedman, Keynes, and even Karl Marx, although they all disagreed on which variable in the equation should be emphasized. Keynes’ believed that it was determined by aggregate demand (Q), Marx believed it was determined by the amount of goods in circulation (also Q), and the Monetarist’s view led by Friedman, is that what determines inflation is the quantity of money in circulation (M), and can be controlled by the Fed. In other words, the Keynesian approach to controlling the economy was to focus on aggregate demand, usually through fiscal stimulus, while the Monetarist approach is to focus on the money supply.
Velocity of Money
In its mathematical form, let’s look at the simplified Equation of Exchange.
Equation of Exchange
In this equation,
M is the total nominal amount of money supply in the economy. As mentioned above “money” can mean different things, but in here let’s say it’s the M2 money supply, which is all cash, checking and savings deposits and money market securities.
V is the velocity of the M2 money supply, which is the average amount of times a dollar is used in a transaction in a time period within the economy.
P is the price level, which is basically CPI
Q is the real value of all expenditures in an economy. This is basically the same as GDP.
To see how this relates to inflation, we’re going to need to look at how the price changes with respect to time. Time to add some calculus to this to look at the first time-derivative of P.
Hand-written derivation of inflation from the Equation of Exchange
I hand-wrote this because I was too lazy to write this up on LaTeX. The usually cited version of this is to pretend velocity money is constant and not deal with calculus by using approximations for when changes are very small. This results in ΔP = ΔM – ΔY, which is what you’ll see in most ECON101 textbooks. The problem with this assumption is that velocity of money is not constant and this will not be reflected in long-term effects since this approximation only works for very small changes and neglects feedback loops.
Okay, so let’s look at my handwritten equation. If you can’t read math, what it says is that the inflation rate
Increases with the rate of change in the money supply
Increases with the rate of change in the velocity of money
Decreases with the rate of change in the GDP
Higher velocity of money amplifies the effects of changes in money supply
Higher money supply amplifies the effects of changes in money velocity
Higher price levels amplifies the effects of changes in GDP
Decreases in GDP amplifies all changes in inflation
Now, let’s take a look from the Fed’s perspective. This probably isn’t that reflective of the Fed’s actual decision making process but it’s one way of seeing how everything relates to each other, and all the other models (eg. IS-LM, AD-AS) basically lead towards a similar conclusion. The Fed wants to have a fixed inflation rate no matter what. It’s extremely hard for both the Fed and federal government to control behaviors of consumers, and how quickly they spend money they receive, so velocity of money is sort of just a given. GDP can somewhat be controlled by the governments through fiscal stimulus, by using deficits to fuel economic growth, although this isn’t sustainable if there’s no fundamental reason for increased productivity. As I mentioned previously, this is probably the case and what we’ve been looking at for the past decade was a period of debt-fueled economic growth, and we would have seen stagnation if the government hadn’t grown deficits in the past decade.
From the Fed’s perspective the only thing it can control is money supply, but this usually needs to be done slowly and carefully. Dramatic changes in prices will amplify the effects of any GDP changes due to inflation, causing even more dramatic changes to price levels as well as decreased GDP due to economic uncertainty from unpredictable price levels – hyperinflation, or deflationary spiral. You also don’t want to suddenly massively increase your money supply because this will amplify any effects increased money velocity has on inflation. Increased inflation will also lead to less savings and more people spending money as soon as they receive it. Also hyperinflation. Mathematically, the equation stated above is a first-order differential equation on every variable, meaning it’s full of positive feedback – specifically positive feedback loops.
Real GDP, 1984 – 2020
Velocity of Money, 1960 – 2020
So what do we see happening since 2000?
Slightly declining secular GDP growth
A dramatic drop in the velocity of money from the 1997 peak of 2.2 per quarter to 1.3 in Q12020. The falling velocity of money is most likely attributed by the slow rise in income inequality in North America, and since rich people have a lower propensity to consume (i.e. every extra dollar, they will more likely invest / save it rather then spend it on consumption), this reduced the number of times dollars get spent.
Clearly, the inflationary effects of slower GDP growth is far exceeded by reduced velocity of money. This is actually usually the case, and it’s why you usually see deflation rather than inflation for most stagnating developed economies (eg. Europe and Japan). Because of positive feedback loops, when this happens, it’s very hard to escape and is called a deflationary spiral. To combat the deflationary pressure and maintain the same inflation rate as the 1990s, the only thing the Fed can do is increase monetary supply, using the mechanisms described.
Up until 2008, the primary mechanism was lowering interest rates, which inflates the money supply through lending. The new money supply, through loans, would be mostly issued for consumption, like a mortgage to buy a new house or a new car loan to buy a car. This will have the added benefit of increasing velocity of money because this new money supply is recycled into the economy. After 2008, the Fed had to find a new mechanism, with interest rates being permanently too close to zero to have any meaningful impact on the money supply to actually help anything, especially since most Fed board members think that negative interest rates are a bad idea. With quantitative easing, direct purchases of treasuries artificially lowers the yields of treasuries and makes bonds and equities relatively more attractive when looking at risk / reward, inflating prices of those securities. We’ve effectively reached 0% yield on the risk-free-rate during the last crisis, so the next logical step for the Fed was to buy other securities, like commercial paper and now bonds. Except, as shown earlier, the biggest holders of treasuries and bonds were actually corporations and high-net-worth individuals, who compared to regular people have a much lower propensity to consume, and would not at all address the lowering velocity of money. It also leads towards higher wealth inequality, as it inflates prices of those securities, and all other financial assets which are concentrated at the top corporations and individuals, which tends to be bad for velocity of money. In simplified terms, the increase in money supply goes towards the people who already held a lot of wealth. This is probably why we’re seeing a steep drop-off of money velocity after 2008, even after the economy has recovered.
Velocity of Money in an Pandemic
A pandemic and lockdown brings a whole new level of challenges in maintaining this delicate balance. Suddenly, all the variables are changing rapidly with the economic shock. Although we don’t have definitive data on this yet, it’s pretty clear that this lockdown will see a sudden and dramatic decrease in money changing hands. At the same time, we’re going to see the biggest sudden drop in GDP in history – at the scale of the Great Depression but occurring in the span of months. To add to the shit show, oil prices are in an absolute mess, adding even more downwards pressure to CPI. The Fed is now trying to fine tune this economic machine to balance. The positive feedback loops mean that if they’re not able to expand the supply of money enough, we’ll quickly see a deflationary spiral. If they do too much, we quickly get into hyperinflation. As the world’s reserve currency, and having the vast majority of countries in the world being short dollars, with debt denominated in USD, it’ll be virtually impossible to see hyperinflation.
The Fed has pretty much maxed out on everything they could have possibly done to keep inflation at 2% by increasing the money supply using tools they’re allowed to use. Interest rates and the risk free rate have been near 0% since 2008, and bond yields are already at unrealistic levels for the amount of risk they have, resulting in a skyrocketing increase in equities. Since none of these actually address the velocity of money issue, which has likely sharply decreased since March, we’re probably going to head towards a deflationary spiral. What does this mean for equity prices? We’ve seen this exact scenario play out in Japan during the 1990s and parts of Europe in the 2010s, and counterintuitively, we see an L shaped recovery economically and a collapse of equity prices. I already talked about this extensively so you can read that if you want to know more about it.
What was my point again (TLDR)?
Wow that was long. Let’s go over everything in here
Money is usually created from banks issuing credit.
Fed influences credit issuance with overnight repo rates and open market operations
HNWIs and corporations store a lot of wealth in treasuries and bonds as a vehicle to preserve wealth.
Everyone was trying to get their hands on dollars in March, especially internationally where many debts are denominated in USD
Fed’s actions lowers the “risk free rate”, which is used in valuations of securities. This changes the risk / reward desired by investors for other securities and causes those prices to increase. They’ve artificially deflated yields (i.e. reward / risk) of bonds in March, inflating equity prices even more.
Since the 2000s, the Fed has started targeting a specific interest rate.
Velocity of money, caused by increasing wealth inequality in individuals and businesses in the US, has been steadily decreasing since the 2000s.
Decreased money velocity, with stagnating GDP, means the Fed has to increase the money supply with liquidity to keep inflation at the desired level. Positive feedback loops means that they need an increasing amount of liquidity to have the same effect.
Increasing liquidity through money supply increases wealth inequality and decreases velocity of money.
Even though this has been happening since the 2000s, a lockdown just accelerates this process.
Fed probably can’t do anything else to stop a deflationary spiral, which is where we’re headed.
Japan and parts of Europe had something similar happen a few years ago, and it didn’t end up well.
L-shaped recovery and a stock market collapse
SPY 12/16/2022 175p
I just want to know if I should buy SPY calls or puts
See my short term thesis from two weeks ago (tldr – SPY will go sideways between 293 – 274 for a few weeks), and last week’s post, where I talked about the declining momentum of the bullish sentiment (tldr – 293 (+- 2%) was the top, going to see a reversal soon). I’ll also be updating this post with my live thoughts / moves for this week, for those who care and like reading about what other people do. For this week overall, I’m looking for re-confirmation of my thesis with the following events happening
SPY going back down after reaching 293 (+- 2%) SPY falling past 278, which is the 50% Fib level where we reversed off over a week ago. This will open up 274 and form a double-top bearish signal. Daily MACD crossover
EDITS – Live thoughts
5/10 10:30PM – /ES at 2945, near the upper limit allowed by my thesis. 15m and 1h are overbought on RSI, so expecting it to not move past this level and move back down to ~2930 when market opens tomorrow.
5/11 2AM – /ES back right underneath 2930 after reaching 2950 (200D MA). Looking good for my short-term thesis so far
5/11 Market Open – SPY opened at 290, reversing off of 293 from Friday. /ES hourly has a bearish MACD on 1H so we might so SPY slowly go down below 289 today. If that happens my short-term thesis is re-confirmed.
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.


investmentwatchblog--2020-05-11--Have We Passed The Peak?

Have We Passed The Peak?

This chart is trying to give a sense of where each country is relative to its own peak of the @ @ @ @ @ assess relaxing restrictions .
It ’ s not intended to make comparisons between countries .
@ @ @ @ @ data should be used by lawmakers to make decisions .
New York for example was @ @ @ @ @ areas in its outbreak .

by chartr
This chart is trying to give a sense of where each country is relative to its own peak of the outbreak as governments begin to assess relaxing restrictions.
It’s not intended to make comparisons between countries.
In reality more specific regional data should be used by lawmakers to make decisions. New York for example was significantly ahead of other urban areas in its outbreak.
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Source: Johns Hopkins University
Tool: Microsoft Excel


investmentwatchblog--2020-05-11--Global earning estimates for the next 12 months show expectations have been cut sharply.

This Bond Market Signal Indicates the Bear Market Isn ’ t Over Yet The price action of high-yield corporate bonds @ @ @ @ @ the bear market triggered by the coronavirus pandemic is truly at its bottom , according @ @ @ @ @ Secretary Warns of ‘ Permanent Economic Damage ’ if US Doesn ’ t Reopen Treasury @ @ @ @ @ May 10 that reopening the economy must be done in a strategic way , but @ @ @ @ @ economic damage ” might be done if lockdown measures aren ’ t lifted .

Global earning estimates for the next 12 months show expectations have been cut sharply. But are the expectations too optimistic still? Too pessimistic? Too many unknowns. #markets #stocks #earnings #corporates
Chart via J.P. Morgan & FactSet pic.twitter.com/AhZolMKwpL — Andres Garcia-Amaya, CFA (@andrgarc) May 11, 2020
There are TWO #Amazing points about the chart below:
1) You are paying WAY too much for #stocks right now, and 2) If you owned anything other than FANNGM over the last 5-years you #underperformed the #SP500. pic.twitter.com/b832mVPtat — Lance Roberts (@LanceRoberts) May 11, 2020
The price action of high-yield corporate bonds will signal to investors when the bear market triggered by the coronavirus pandemic is truly at its bottom, according to Longview Economics.
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Treasury Secretary Steven Mnuchin said on May 10 that reopening the economy must be done in a strategic way, but he stressed that “permanent economic damage” might be done if lockdown measures aren’t lifted.
Central counterparties’ margining turns counterparty risk into #LiquidityRisk: large margin calls during the March turmoil strained dealer banks’ liquidity just when households & firms relied on banks for funding #BISBulletin #Clearing t.co/zdMtg3X3oC [Corrected graph] pic.twitter.com/ET2FS75Oxv — Bank for International Settlements (@BIS_org) May 11, 2020


investmentwatchblog--2020-05-11--2020 Pentagon study: Flu vaccines increase risk of coronavirus by 36%

Examining non-influenza viruses specifically , the odds of coronavirus in vaccinated individuals were significantly higher when compared to unvaccinated individuals @ @ @ @ @ association between an exposure and an outcome ) of 1.36 .
In other words , @ @ @ @ @ more likely to get coronavirus .

Examining non-influenza viruses specifically, the odds of coronavirus in vaccinated individuals were significantly higher when compared to unvaccinated individuals with an odds ratio (association between an exposure and an outcome) of 1.36. In other words, the vaccinated were 36% more likely to get coronavirus.
childrenshealthdefense.org/news/vaccine-misinformation-flu-shots-equal-health/
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h/t Natura Naturans


investmentwatchblog--2020-05-11--Obama Official Evelyn Farkas Admitted -Lied on MSNBC Having Evidence of Collusion

Former Obama administration defense official Evelyn Farkas testified under oath that she lied during an MSNBC interview when she claimed to have evidence of alleged collusion , a newly declassified congressional transcript of her testimony shows .
Farkas testified before the House Permanent Select Committee on Intelligence on June 26 , 2017 , as part of the committee ’ s investigation into Russian interference in the 2016 presidential election between Donald Trump and former Secretary of State Hillary Clinton .
Lawmakers keyed in on an appearance Farkas made on MSNBC on March 2 , 2017 , in which she urged @ @ @ @ @ @ @ government and potentially even leak to media any incriminating information they had about Trump or his aides .
But Farkas sang a different tone under oath when questioned by lawmakers about what she actually “ knew ” about collusion .
“ Why don ’ t we go back to that sentence that I just asked you about .
It says ‘ the Trump folks , if they found out how we knew what we knew about their staff dealing with Russians , ” Gowdy said .
“ Well , how would you know @ @ @ @ @ @ @ point ?
You didn ’ t work for it , did you ?
” “ I didn ’ t , ” said Farkas , a former mid-level Russia analyst who left the federal government in 2015 .
“ Then how did you know ?
” Gowdy responded .
“ Did you have information connecting the Trump campaign to the hack of the DNC ?
” Gowdy asked .
“ So when you say , ‘ We knew , ’ the reality is you knew nothing , ” Gowdy asked later during the deposition @ @ @ @ @ @ @ knew , ’ what you really meant was felt ?
” he asked .
Farkas , a Democrat , is currently running for Congress in New York ’ s 17th district .

thefederalist.com/2020/05/08/oba…collusion/
www.dni.gov/files/HPSCI_Transcri…dacted.pdf
Former Obama administration defense official Evelyn Farkas testified under oath that she lied during an MSNBC interview when she claimed to have evidence of alleged collusion, a newly declassified congressional transcript of her testimony shows. Farkas testified before the House Permanent Select Committee on Intelligence on June 26, 2017, as part of the committee’s investigation into Russian interference in the 2016 presidential election between Donald Trump and former Secretary of State Hillary Clinton.
Lawmakers keyed in on an appearance Farkas made on MSNBC on March 2, 2017, in which she urged intelligence community bureaucrats to disseminate within the government and potentially even leak to media any incriminating information they had about Trump or his aides.
But Farkas sang a different tone under oath when questioned by lawmakers about what she actually “knew” about collusion.
“Why don’t we go back to that sentence that I just asked you about. It says ‘the Trump folks, if they found out how we knew what we knew about their staff dealing with Russians,” Gowdy said. “Well, how would you know what the U.S. government knew at that point? You didn’t work for it, did you?”
“I didn’t,” said Farkas, a former mid-level Russia analyst who left the federal government in 2015.
“Then how did you know?” Gowdy responded.
“I didn’t know anything,” Farkas said.
“Did you have information connecting the Trump campaign to the hack of the DNC?” Gowdy asked.
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“No,” Farkas admitted.
“So when you say, ‘We knew,’ the reality is you knew nothing,” Gowdy asked later during the deposition.
“Correct,” Farkas responded.
Gowdy didn’t stop there.
“So when you say ‘knew,’ what you really meant was felt?” he asked.
“Correct,” Farkas answered.
“You didn’t know anything?” Gowdy continued.
“That’s correct,” Farkas responded.
Farkas, a Democrat, is currently running for Congress in New York’s 17th district.
h/t Eustace Muffins


investmentwatchblog--2020-05-11--New York City Won’t Open UNTIL SEPTEMBER? – NEXT Step Is TRACKING Everyone EVERYWHERE!

Josh Sigurdson reports on the continued closures in NYC as Bill De Blasio claims there likely won ’ t be @ @ @ @ @ .
He also says that he ’ d like everyone to be tracked via before @ @ @ @ @ How convenient .
Meanwhile millions are out of work and in need of feeding their @ @ @ @ @ global depression in world history .
How will this end ?
Who benefits ?
How @ @ @ @ @ months more of this insanity ?

Josh Sigurdson reports on the continued closures in NYC as Bill De Blasio claims there likely won’t be a full reopening until September. He also says that he’d like everyone to be tracked via before being allowed out regularly. How convenient. Meanwhile millions are out of work and in need of feeding their family while facing the biggest global depression in world history. How will this end? Who benefits? How will people respond after many months more of this insanity?
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investmentwatchblog--2020-05-11--Banks Continue To Send Bearish Divergence Message, At 800 Pound Resistance!

Is the Banking Index sending a caution message to stocks ?
It has for the past 28-months and it is @ @ @ @ @ of late !
The Banking Index ( BKX ) started underperforming the broad market back @ @ @ @ @ which created a negative divergence message to the broad markets .
Banks started turning much @ @ @ @ @ in December of 2019 , almost 60-days before the broad market experienced a sharp sell-off @ @ @ @ @ than the broad market after its peak late last year .
The counter-trend rally over @ @ @ @ @ banks testing a “ Quad Resistance Zone ” at ( 1 ) .
While testing @ @ @ @ @ created a large bearish reversal pattern two weeks ago .
Banks have been sending an @ @ @ @ @ health of the broad markets , long before virus concerns became front-page news .
What @ @ @ @ @ ( 1 ) , most likely will send a very important message about the health @ @ @ @ @ next 60 to 90-days !

by Kimble Charting
Is the Banking Index sending a caution message to stocks? It has for the past 28-months and it is experiencing a major resistance test of late!
The Banking Index (BKX) started underperforming the broad market back in January of 2018, which created a negative divergence message to the broad markets.
Banks started turning much weaker than the broad market in December of 2019, almost 60-days before the broad market experienced a sharp sell-off. Banks also fell more than the broad market after its peak late last year.
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The counter-trend rally over the past six weeks has banks testing a “Quad Resistance Zone” at (1). While testing this resistance zone, it created a large bearish reversal pattern two weeks ago.
Banks have been sending an important message about the overall health of the broad markets, long before virus concerns became front-page news.
What the Banking sector does at (1), most likely will send a very important message about the health of the markets for the next 60 to 90-days!


investmentwatchblog--2020-05-11--You Won’t Believe What’s Happening To YOUR Stocks & Bonds

It may Take Them Months Just To Get YOUR Money To You
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investmentwatchblog--2020-05-11--URGENT! They’re Coming to Take You Away – Through H.R. 6666

URGENT !
They ’ re Coming to Take You Away – Through H.R .
6666

URGENT! They’re Coming to Take You Away – Through H.R. 6666
www.congress.gov/bill/116th-cong…xt?r=2&s=1
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h/t EyesWideOpen111


investmentwatchblog--2020-05-11--Don’t Fight the Fed. But Did You Forget About Lehman Collapse?

What we ’ re seeing today is NOT 2008 .
It ’ s NOT 2000 .
It ’ s unique .
But the mistakes are always the same .
Too much intervention helping out the wrong groups .
The majority get screwed over .
Wealth gap increases .
Pattern repeats .
If people learn one thing , it ’ s that we need to learn more .
Arrogance has no place in this .
We must always be students of the knowledge .
You hear that mantra all the time .
Don ’ t fight the Fed .
It comes @ @ @ @ @ @ @ Buffett , except when he says it ’ s not a good time to buy stocks .
This is from the same people who have never looked into the books of a company and simply buying into companies they use regularly is a sound investment strategy .
Well… Don ’ t fight the Fed , join them with these ETFs the central bank could be buying Federal Reserve Board – Federal Reserve announces it will initiate a program to purchase the direct obligations of housing-related government-sponsored enterprises and mortgage-backed securities backed by Fannie @ @ @ @ @ @ @ Mae

What we’re seeing today is NOT 2008. It’s NOT 2000. It’s unique. But the mistakes are always the same. Too much intervention helping out the wrong groups. The majority get screwed over. Wealth gap increases. Pattern repeats. If people learn one thing, it’s that we need to learn more. Arrogance has no place in this. We must always be students of the knowledge.
You hear that mantra all the time. Don’t fight the Fed. It comes from the same people who quote Warren Buffett, except when he says it’s not a good time to buy stocks. This is from the same people who have never looked into the books of a company and simply buying into companies they use regularly is a sound investment strategy. Well…
Don’t fight the Fed, join them with these ETFs the central bank could be buying
www.cnbc.com/2020/05/08/dont-fight-the-fed-join-them-with-these-etfs-the-central-bank-could-be-buying.html
Bear Stearns collapses, sold to J.P. Morgan Chase – HISTORY
www.history.com/this-day-in-history/bear-stearns-sold-to-j-p-morgan-chase
Federal Reserve Credit Programs During the Meltdown | Federal Reserve History
www.federalreservehistory.org/essays/fed_credit_programs
Federal Reserve Board – Federal Reserve announces it will initiate a program to purchase the direct obligations of housing-related government-sponsored enterprises and mortgage-backed securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae
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www.federalreserve.gov/newsevents/pressreleases/monetary20081125b.htm
Congress approves $700 billion Wall Street bailout – The New York Times
www.nytimes.com/2008/10/03/business/worldbusiness/03iht-bailout.4.16679355.html
Federal Reserve Board – FOMC statement
www.federalreserve.gov/newsevents/pressreleases/monetary20090318a.htm
Federal Reserve Board – FOMC statement
www.federalreserve.gov/newsevents/pressreleases/monetary20100316a.htm
S&P 500 Index Chart — SPX Quote — TradingView
www.tradingview.com/symbols/SPX/


investmentwatchblog--2020-05-11--Covid Socialism is here!

Covid Socialism is here!

Democrats are rallying behind a plan to give most Americans monthly $ 2,000 relief checks during the coronavirus crisis , an issue that ’ s popular with the liberal base and American voters amid widespread economic damage from the deadly pandemic .
There ’ s no guarantee the costly proposal will make it into the final coronavirus package that will eventually be negotiated by the Trump administration and Democratic leaders .
Republicans , who control the Senate , are balking at the idea even as the president concedes more aid may be needed for workers .
But on a call @ @ @ @ @ @ @ Speaker Nancy Pelosi ( D-Calif. ) endorsed the monthly relief checks – the greatest indication yet that she could include the plan in the CARES 2 package that House Democrats plan to unveil in the coming days .
“ The government has told people we need to shelter in place to keep safe .
So it ’ s the government ’ s obligation to provide for basic expenses while we ’ re telling people not to work .
It ’ s really that simple , ” Rep. Ro Khanna ( D-Calif. ) , @ @ @ @ @ @ @ calling for more relief checks , told The Hill .
“ We need $ 2,000 a month for families struggling to pay the bills , ” he added .
The idea builds off the initial $ 2.2 trillion CARES Act , which gave most Americans one-time stimulus checks of up to $ 1,200 , plus more money for each dependent , and has been gaining momentum among Democrats on both sides of the Capitol .
Rep. Rashida Tlaib ( D-Mich. ) and Progressive Caucus Co-Chair Pramila Jayapal ( D-Wash. ) have teamed up @ @ @ @ @ @ @ every American $ 2,000 a month for the duration of the crisis , and $ 1,000 a month for an entire year after the crisis ends .
Similar legislation offered by Khanna , who was co-chairman of Sen. Bernie Sanders ’ s ( I-Vt. ) presidential campaign , and Rep. Tim Ryan ( D-Ohio ) , would be based on means testing .
The Emergency Money for the People Act would give a $ 2,000 monthly payment to individuals making less than $ 130,000 a year , or $ 4,000 a month for @ @ @ @ @ @ @ .
Reps. Madeleine Dean ( D-Pa. ) and Don Beyer ( D-Va. ) , the top Democrat on the Joint Economic Committee , are calling on Pelosi to include their plan in the next coronavirus bill .
It calls for an additional one-time $ 1,500 payment and possible $ 1,000 quarterly payments based on certain “ triggers , ” including high unemployment .

via thehill
Democrats rally behind monthly $2,000 relief checks
Democrats are rallying behind a plan to give most Americans monthly $2,000 relief checks during the coronavirus crisis, an issue that’s popular with the liberal base and American voters amid widespread economic damage from the deadly pandemic.
There’s no guarantee the costly proposal will make it into the final coronavirus package that will eventually be negotiated by the Trump administration and Democratic leaders.
Republicans, who control the Senate, are balking at the idea even as the president concedes more aid may be needed for workers.
But on a call with Democrats this week, sources said Speaker Nancy Pelosi (D-Calif.) endorsed the monthly relief checks – the greatest indication yet that she could include the plan in the CARES 2 package that House Democrats plan to unveil in the coming days.
“The government has told people we need to shelter in place to keep safe. So it’s the government’s obligation to provide for basic expenses while we’re telling people not to work. It’s really that simple,” Rep. Ro Khanna (D-Calif.), a progressive leader who has authored legislation calling for more relief checks, told The Hill.
“We need $2,000 a month for families struggling to pay the bills,” he added.
The idea builds off the initial $2.2 trillion CARES Act, which gave most Americans one-time stimulus checks of up to $1,200, plus more money for each dependent, and has been gaining momentum among Democrats on both sides of the Capitol.
Rep. Rashida Tlaib (D-Mich.) and Progressive Caucus Co-Chair Pramila Jayapal (D-Wash.) have teamed up on the ABC Act that would give every American $2,000 a month for the duration of the crisis, and $1,000 a month for an entire year after the crisis ends.
Similar legislation offered by Khanna, who was co-chairman of Sen. Bernie Sanders’s (I-Vt.) presidential campaign, and Rep. Tim Ryan (D-Ohio), would be based on means testing. The Emergency Money for the People Act would give a $2,000 monthly payment to individuals making less than $130,000 a year, or $4,000 a month for couples making less than $260,000 annually.
Reps. Madeleine Dean (D-Pa.) and Don Beyer (D-Va.), the top Democrat on the Joint Economic Committee, are calling on Pelosi to include their plan in the next coronavirus bill. It calls for an additional one-time $1,500 payment and possible $1,000 quarterly payments based on certain “triggers,” including high unemployment.


investmentwatchblog--2020-05-11--Interecepted Phone Call – Xi told Dr. Tedros to carry out virus coverup…

WHO denies coronavirus cover-up phone call between Xi Jinping and Dr. Tedros The World Health Organization denied a report that @ @ @ @ @ pressured WHO Director-General Tedros Adhanom Ghebreyesus to conceal the truth about the coronavirus outbreak in @ @ @ @ @ Der Spiegel , a German news outlet , published a report this weekend that said @ @ @ @ @ Service ( known as the “ Bundesnachrichtendienst ” or BND ) found that China “ @ @ @ @ @ “ delay a global warning ” about the coronavirus outbreak .
Specifically , Der Spiegel @ @ @ @ @ BND determined Xi and Tedros spoke by phone on Jan. 21 and the Chinese leader @ @ @ @ @ “ hold back information about a human-to-human transmission and to delay a pandemic warning.
” @ @ @ @ @ “ estimates ” that China ’ s policy of concealing information about the coronavirus resulted @ @ @ @ @ weeks in the fight against the virus worldwide .

www.washingtonexaminer.com/news/…-dr-tedros
www.spiegel.de/politik/deutschla…ce27cff69c
WHO denies coronavirus cover-up phone call between Xi Jinping and Dr. Tedros
The World Health Organization denied a report that said Chinese President Xi Jinping pressured WHO Director-General Tedros Adhanom Ghebreyesus to conceal the truth about the coronavirus outbreak in a January phone call.
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Der Spiegel, a German news outlet, published a report this weekend that said Germany’s Federal Intelligence Service (known as the “Bundesnachrichtendienst” or BND) found that China “urged” the WHO to “delay a global warning” about the coronavirus outbreak. Specifically, Der Spiegel‘s report said the BND determined Xi and Tedros spoke by phone on Jan. 21 and the Chinese leader asked the WHO chief to “hold back information about a human-to-human transmission and to delay a pandemic warning.”
The newspaper said the BND “estimates” that China’s policy of concealing information about the coronavirus resulted in four to six lost weeks in the fight against the virus worldwide.
h/t Eustace Muffins


investmentwatchblog--2020-05-11--Nursing homes account for ‘staggering’ share of US deaths – Nursing home patients had a median life

Nursing homes account for ‘staggering’ share of US deaths – Nursing home patients had a median life expectancy of 5 months before Covid-19.

Covid-19 : nursing homes account for ‘ staggering ’ share of US deaths , data show .
The median stay @ @ @ @ @ 5 months from admission until death .
In New Hampshire , they found 72 % @ @ @ @ @ home patients .
Patients that had a life expectancy of about 5 months and would @ @ @ @ @ .
We trashed the constitution and damned millions of people to poverty so some dying @ @ @ @ @ month or two .

by Spaceman_Spliff
Covid-19: nursing homes account for ‘staggering’ share of US deaths, data show.
The median stay for nursing home patients is 5 months from admission until death.
In New Hampshire, they found 72% of deaths were from nursing home patients. Patients that had a life expectancy of about 5 months and would have died this year anyway.
We trashed the constitution and damned millions of people to poverty so some dying people could suffer an extra month or two.


investmentwatchblog--2020-05-11--Forced Vax in South Carolina – Pending law?

SECTION 44-29-50 .
Violation of regulation relating to vaccination , screening , or immunization .
Any person who shall fail @ @ @ @ @ comply with any regulation of the Department of Health and Environmental Control relating to vaccination @ @ @ @ @ be deemed guilty of a misdemeanor and upon conviction shall be fined not more than @ @ @ @ @ imprisoned for not more than thirty days .
I live in SC – this is @ @

SECTION 44-29-50. Violation of regulation relating to vaccination, screening, or immunization.
Any person who shall fail, neglect or refuse to comply with any regulation of the Department of Health and Environmental Control relating to vaccination, screening or immunization shall be deemed guilty of a misdemeanor and upon conviction shall be fined not more than one hundred dollars or be imprisoned for not more than thirty days.
HISTORY: 1962 Code Section 32-578; 1952 Code Section 32-578; 1942 Code Section 5042; 1932 Code Section 1503; Cr. C. ’22 Section 451; Cr. C. ’12 Section 441; 1905 (24) 871; 1972 (57) 2523.
www.scstatehouse.gov/code/t44c029.php?fbclid=IwAR2qI-jorP_3XjuQUxrwTxtDqhiURSNdgomh4hxYCv4wPmjBytPtS5tOpYg#top
I live in SC – this is terrifying.


investmentwatchblog--2020-05-11--If you live in USA, especially California, you need to see this… Mandatory testing of those on benef

If you live in USA, especially California, you need to see this… Mandatory testing of those on benefits

Thought this needed it ’ s own thread as it is very important .
Sorry if already posted , couldn @ @ @ @ @ .
Go to 8:26 of video… Won ’ t be long until this is the @ @ @

Thought this needed it’s own thread as it is very important.
Sorry if already posted, couldn’t find it anywhere.
Go to 8:26 of video…
Won’t be long until this is the norm everywhere.
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h/t MAGIC PIE


investmentwatchblog--2020-05-11--Will Record May Cold in Europe and N. America Wipe Out Crops

Record cold records broken by the thousands between N. America , Australia and Europe over the first weeks and a @ @ @ @ @ Wheat planting is 22 % compared to 49 % the average in USA .
So @ @ @ @ @ with the warm spring and now epic May freeze in multiple continents , how do @ @ @ @ @ agriculture in 2020 ?

Record cold records broken by the thousands between N. America, Australia and Europe over the first weeks and a half on May 2020. Wheat planting is 22% compared to 49% the average in USA. So the question to be asked with the warm spring and now epic May freeze in multiple continents, how do you think this will affect agriculture in 2020?
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investmentwatchblog--2020-05-11--Dallas Salon Owner Arrested For Opening Business Gets Big Surprise From Hannity During Interview

The Daily Wire reports , Shelley Luther , the Dallas salon owner who was jailed this week for defying the @ @ @ @ @ when she opened up her business , joined Fox News host Sean Hannity on Thursday @ @ @ @ @ an unexpected surprise .

The Daily Wire reports, Shelley Luther, the Dallas salon owner who was jailed this week for defying the county’s stay-at-home order when she opened up her business, joined Fox News host Sean Hannity on Thursday night, where she got an unexpected surprise.
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Read More/Source/Credit/FairUse:
www.dailywire.com/news/dallas…


investmentwatchblog--2020-05-11--MUST SEE! Ted Cruz Responds to Cuomo’s New York ‘Bailout’ Rant

Courtney O ’ Brien from Townhall reports , For days now Gov .
Andrew Cuomo has been harping on glib @ @ @ @ @ McConnell made when he rejected the idea that the federal government needs to send more @ @ @ @ @ local governments during the CV outbreak .
He referred to the notion as a “ @ @ @ @ @ suggesting that it was largely Democratic-run states that were seeking help .

Courtney O’Brien from Townhall reports, For days now Gov. Andrew Cuomo has been harping on glib comments Senate Majority Leader Mitch McConnell made when he rejected the idea that the federal government needs to send more financial aid to state and local governments during the CV outbreak. He referred to the notion as a “blue state bailout,” suggesting that it was largely Democratic-run states that were seeking help.
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Read More/Source/Credit/FairUse:
townhall.com/tipsheet/cortney…


investmentwatchblog--2020-05-11--Oil Industry Collapse And Negative Rates Lead To Another Stock Market Crash

Last week , we have seen for the first time Fed ’ s future funds priced in negative rates , for both November 2020 and January 2021 , and as the oil industry is crashing and negative rates basically mean a death sentence and a deflationary economic collapse for the global system , a deeper stock market crash is about to come .
Thomas Barkin , Richmond Fed president has stated loud and clear that he thinks it is not worth it to try negative rates in the US , as he declares that he thinks negative interest rates have @ @ @ @ @ @ @ he hadn ’ t seen anything that could make him think they ’ re worth a try in America , adding that if we looked at the recent data , we would see it as low as it would go .
Affirming firmly that eventually , people will be brought back to work , and hopefully they will be back to stores , and within weeks or months , he expects this data to go up from where it is .
As we have continuously addressed in previous videos , the idea of @ @ @ @ @ @ @ was left off it is not a realistic plan at this point in time and history .
So it seems that he doesn ’ t actually have a plan , as this was his response to a dramatic move that echoed across asset classes , in which 2Y yields plummeted to record-lows , while stocks and gold sky-rocketed , making markets finally acknowledge that NIRP is likely to come in the next months .
Either way , looking at the Fed funds after Barkin ’ s statement , we can see that the @ @ @ @ @ @ @ attention , with December implied rates still in negative area .
With that said , it seems that the only way out of this mess would be if Powell handled this situation without any delay , reversing the market ’ s test of the Fed ’ s resolve from ZIRP to NIRP , however , he has to take action immediately , otherwise if the negative rates become even more accepted , and Powell utterly denies it down the road , making it look like a hawkish reversal , that could potentially lead @ @ @ @ @ @ @ and even with the Fed debating that nobody could have predicted that this was coming , ultimately it will be forced to cut to negative rates anyways .
That ’ s precisely what BMO analyst , Jon Hill , has been defending , saying that with “ certain Fed funds futures contracts now trading with a negative implied yield , Powell needs to decide whether he wants to nip that possibility in the bud – if the FOMC drags their feet too much , they run the risk of creating either a self-fulfilling @ @ @ @ @ @ @ hawkish ’ Fedspeak later down the road.
” In addition , Hill forecasts that “ a cut into negative territory remains unlikely .
On three separate occasions during the last press conference , Powell referred to the current target range as the ‘ effective lower bound ’ ; implicitly acknowledging that any further reduction in the target range would be self-defeating.
” But even so , the market doesn ’ t seem to agree with Powell ’ s resolution , and investors are currently pushing the negative rates trade for later November .
@ @ @ @ @ @ @ quickly , over time , more and more proximal Fed funds futures will violate the NIRP lines , to the point that the market becomes sure that NIRP is not only permissible as it is priced in .
By that time , it will be terribly late for Powell to intervene , as we could analyze from the latest episodes , once another negative reaction happens in stocks , the Fed ’ s chair is likely to have a breakdown .
If it isn ’ t in his plans to inject further $ @ @ @ @ @ @ @ by now , as estimated by Deutsche Bank , that would be proportional to catching down the -1 % r* ( r-star ) , his only alternative would be to admit that the US has joined Japan and Europe in the monetary gray area .
As a matter of fact , the Eurodollar market has already started to panic , as many analysts have been saying that with the Fed fund futures climbing to contract highs , it is expected that the first priced negative rate switches from January 2021 to December 2020 @ @ @ @ @ @ @ of the Fed , with bonds , stocks , and FX pricing negative rates within less than 6 months from now .
Remembering what happened in 2015 , when the Fed has started to deal with its first tightening cycle in over a decade , being set to raise rates for the next three years , they were warned that elevating its rates would be a bulky policy error , because , back then , the r* or “ the natural rate of interest in an economy where total debt/GDP was 350 % @ @ @ @ @ @ @ 2 % and falling , the short-run equilibrium real interest rate was a paltry 0.57 % , which also meant that any attempts to push rates notably higher – as the Fed was doing then – would result in catastrophe forcing the Fed to promptly cut rates , if not go negative , ” as stated by a high-profile economy website… Read the full script here : www.epiceconomist.com

Last week, we have seen for the first time Fed’s future funds priced in negative rates, for both November 2020 and January 2021, and as the oil industry is crashing and negative rates basically mean a death sentence and a deflationary economic collapse for the global system, a deeper stock market crash is about to come.
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Thomas Barkin, Richmond Fed president has stated loud and clear that he thinks it is not worth it to try negative rates in the US, as he declares that he thinks negative interest rates have been tried in other places, and he hadn’t seen anything that could make him think they’re worth a try in America, adding that if we looked at the recent data, we would see it as low as it would go. Affirming firmly that eventually, people will be brought back to work, and hopefully they will be back to stores, and within weeks or months, he expects this data to go up from where it is.
As we have continuously addressed in previous videos, the idea of taking the economy back from where it was left off it is not a realistic plan at this point in time and history. So it seems that he doesn’t actually have a plan, as this was his response to a dramatic move that echoed across asset classes, in which 2Y yields plummeted to record-lows, while stocks and gold sky-rocketed, making markets finally acknowledge that NIRP is likely to come in the next months. Either way, looking at the Fed funds after Barkin’s statement, we can see that the stock market hasn’t given much attention, with December implied rates still in negative area.
With that said, it seems that the only way out of this mess would be if Powell handled this situation without any delay, reversing the market’s test of the Fed’s resolve from ZIRP to NIRP, however, he has to take action immediately, otherwise if the negative rates become even more accepted, and Powell utterly denies it down the road, making it look like a hawkish reversal, that could potentially lead to another crash in the market, and even with the Fed debating that nobody could have predicted that this was coming, ultimately it will be forced to cut to negative rates anyways.
That’s precisely what BMO analyst, Jon Hill, has been defending, saying that with “certain Fed funds futures contracts now trading with a negative implied yield, Powell needs to decide whether he wants to nip that possibility in the bud – if the FOMC drags their feet too much, they run the risk of creating either a self-fulfilling dynamic and/or having to effectively implement ‘hawkish’ Fedspeak later down the road.”
In addition, Hill forecasts that “a cut into negative territory remains unlikely. On three separate occasions during the last press conference, Powell referred to the current target range as the ‘effective lower bound’; implicitly acknowledging that any further reduction in the target range would be self-defeating.” But even so, the market doesn’t seem to agree with Powell’s resolution, and investors are currently pushing the negative rates trade for later November.
If Powell neglect to address the situation quickly, over time, more and more proximal Fed funds futures will violate the NIRP lines, to the point that the market becomes sure that NIRP is not only permissible as it is priced in. By that time, it will be terribly late for Powell to intervene, as we could analyze from the latest episodes, once another negative reaction happens in stocks, the Fed’s chair is likely to have a breakdown. If it isn’t in his plans to inject further $2-3 trillion of quantitative equities, because by now, as estimated by Deutsche Bank, that would be proportional to catching down the -1% r* (r-star), his only alternative would be to admit that the US has joined Japan and Europe in the monetary gray area.
As a matter of fact, the Eurodollar market has already started to panic, as many analysts have been saying that with the Fed fund futures climbing to contract highs, it is expected that the first priced negative rate switches from January 2021 to December 2020 tops, setting the next market test of the Fed, with bonds, stocks, and FX pricing negative rates within less than 6 months from now.
Remembering what happened in 2015, when the Fed has started to deal with its first tightening cycle in over a decade, being set to raise rates for the next three years, they were warned that elevating its rates would be a bulky policy error, because, back then, the r* or “the natural rate of interest in an economy where total debt/GDP was 350% and rising, and where GDP was 2% and falling, the short-run equilibrium real interest rate was a paltry 0.57%, which also meant that any attempts to push rates notably higher – as the Fed was doing then – would result in catastrophe forcing the Fed to promptly cut rates, if not go negative,” as stated by a high-profile economy website… Read the full script here: www.epiceconomist.com


investmentwatchblog--2020-05-11--Thousands without power in Maine as polar vortex freezes big chunk of US

Thousands of people were without power in Maine after a punishing spring storm brought snow and high winds Saturday to @ @ @ @ @ cold , caused by a polar vortex that blasted in from the north , set @ @ @ @ @ the region , forecasters said .
The National Weather Service said unusually chilly conditions are @ @ @ @ @ the Central Plains , Midwest , Mid-Atlantic and

Watch the latest video at foxnews.com
Thousands of people were without power in Maine after a punishing spring storm brought snow and high winds Saturday to New England.
The frigid cold, caused by a polar vortex that blasted in from the north, set a number of records across the region, forecasters said.
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The National Weather Service said unusually chilly conditions are expected to linger Sunday across the Central Plains, Midwest, Mid-Atlantic and
www.foxnews.com/us/polar-vortex-may-snow-maine-power-outage-low-temperature-records-broken-east


investmentwatchblog--2020-05-11--MILLIONS Of Small Businesses DESTROYED! – MASS Bankruptcies Cause PANIC

Josh Sigurdson reports on the devastating effects the recent shutdowns have had on the economy and most importantly on jobs @ @ @ @ @ ’ ve seen a RECORD worst jobs report in history and meanwhile 52 % of @ @ @ @ @ States expect to be out of business in 6 months .
Companies are reporting that @ @ @ @ @ for their future than they were in 2008 as the world enters into a global @ @ @ @ @ more companies are reporting they ’ re in distress in the UK as many are @ @ @ @ @ government taking equity in businesses via the debt on their loans to small businesses in @ @ @ @ @ attempting to open up for tourism on July 1st out of necessity .
This will @ @ @ @ @ do nothing .

Josh Sigurdson reports on the devastating effects the recent shutdowns have had on the economy and most importantly on jobs and small businesses.
We’ve seen a RECORD worst jobs report in history and meanwhile 52% of small businesses in the United States expect to be out of business in 6 months.
Companies are reporting that they’re more afraid for their future than they were in 2008 as the world enters into a global depression.
A million or more companies are reporting they’re in distress in the UK as many are floating the idea of the government taking equity in businesses via the debt on their loans to small businesses in Britain.
Meanwhile Greece is attempting to open up for tourism on July 1st out of necessity.
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This will not end well if we do nothing.


investmentwatchblog--2020-05-11--Investors exit stocks at fastest rate since March, ‘tech fatigue’ sets in: BOFA

Investors pulled $ 16.2 billion from stocks in the past week , and added $ 11.3 billion into bonds and @ @ @ @ @ .
BoFA said 9 of 10 clients believed the current market recover was a “ @ @ @ @ @ 7 out of 10 said they would only buy the assets that the U.S. Federal @ @ @ @ @ stimulus schemes .

Investors pulled $16.2 billion from stocks in the past week, and added $11.3 billion into bonds and $53.5 billion into cash.
BoFA said 9 of 10 clients believed the current market recover was a “bear market rally” and 7 out of 10 said they would only buy the assets that the U.S. Federal Reserve purchases through it various stimulus schemes.
www.reuters.com/article/us-global-markets-flows-bofa/investors-exit-stocks-at-fastest-rate-since-march-tech-fatigue-sets-in-bofa-idUSKBN22K163