Rembrandt van Rijn Self-portrait 1629
Brilliant. Hidden in paragraph umpteen: ”Bond strategists have not only been wrong-footed for several years in predicting significantly higher yields, which have not materialized, their predictions last year for where major government bond yields would be at now were also well off the mark.” So what do you do? You poll these people who are always wrong, and write a piece.
The reality is, yields and rates are both stuck at the bottom, unless and until there’s a revolt. It’s out of central bankers’ hands.
A return to significantly higher yields will take longer than previously thought, according to a Reuters poll of fixed-income strategists who slashed their year-ahead major government bond yield forecasts to the lowest since polling began 17 years ago. With no resolution in sight to the U.S.-China trade war, the current modest global economic expansion cycle has taken a hit, prompting major central banks to shift to policy easing this year from a tightening view at the turn of last year. That has not only pushed benchmark sovereign bonds yields to new lows this year, but has also resulted in over $17 trillion – a record amount – of debt securities pushed into the negative yields territory.
And according to the Sept. 19-27 poll of over 100 strategists, that trend of subdued yields is here to stay. About 70% of strategists who answered an additional question said the era of low interest rates and sovereign bond yields will last at least another five years, compared to two years predicted just three months ago. Roughly the same proportion of respondents also said the risk to major sovereign bond yields are tilted toward further declines rather than rises for the remainder of this year. “It is very difficult to imagine a situation where you get a significant upward move in yields. There is clearly a political element at work and then there is policy easing from central banks, which together are anchoring yields lower,” said Beata Caranci, chief economist at TD Bank, referring to the U.S.-China trade war.
“While you can certainly get the risk premium priced-out on the political side, the economic and international side will continue to weigh.” Bond strategists have not only been wrong-footed for several years in predicting significantly higher yields, which have not materialized, their predictions last year for where major government bond yields would be at now were also well off the mark.
“In the final month of the fiscal year, federal agencies scramble to spend what’s left in their annual budget.”
The last few weeks have seen a dramatic surge in US macro data surprises (to the upside), dramatically diverging from the rest of the world (and almost single-handedly improving the global data)… This sudden surge, however, is not a total surprise as we have noted the seasonal patterns in US economic data previously. So why does this pattern exist – and why is it particularly strong in recent weeks? Simple – as OpenTheBooks.com details – it is a reflection of the Federal Government’s “Use-It-Or-Lose-It” Spending Spree…
In the final month of the fiscal year, federal agencies scramble to spend what’s left in their annual budget. Agencies worry spending less than their budget allows might prompt Congress to appropriate less money in the next fiscal year. To avoid this, federal agencies choose to embark on an annual shopping spree rather than admit they can operate on less. This is the “use-it-or-lose-it” spending phenomenon, and it happens every year.
And that surge in spending coincides with this sudden ‘surprise’ burst to the upside. For some context from last year: In the final week of the fiscal year, federal agencies signed nearly 10 percent of all fiscal year 2018 contracts. Between 2015 and 2018, federal spending during the final month of the fiscal year increased by 39 percent. From 2017 to 2018, September spending increased by 16 percent. Contract spending in September 2018 totaled nearly $97 billion. In the final seven days of fiscal year 2018, federal agencies spent $53.3 billion – more than they spent in the entire month of August 2018 ($47 billion). The federal government spent $544 billion on all fiscal year 2018 contracts, but nearly 18 percent of these contracts were purchased in the final month of the fiscal year.
The guy/gal is no whistleblower, but it’s too late to correct that. But still, Trump should demand to meet the people who fed him/her the info.
President Trump on Sunday evening called for the outing of a whistleblower and railed against other individuals, including Rep. Adam Schiff (D-Calif.), at the center of a growing scandal involving his phone call with Ukraine’s president, warning there could be “Big Consequences.” “Like every American, I deserve to meet my accuser, especially when this accuser, the so-called ‘Whistleblower,’ represented a perfect conversation with a foreign leader in a totally inaccurate and fraudulent way. Then Schiff made up what I actually said by lying to Congress,” Trump said in a series of tweets.
“His lies were made in perhaps the most blatant and sinister manner ever seen in the great Chamber,” he continued before adding that he wants Schiff, the chairman of the House Intelligence Committee, “questioned at the highest level for Fraud & Treason.” “In addition,” he added, “I want to meet not only my accuser, who presented SECOND & THIRD HAND INFORMATION, but also the person who illegally gave this information, which was largely incorrect, to the ‘Whistleblower.’ Was this person SPYING on the U.S. President? Big Consequences!”
“It is being reported that Rep. Adam Schiff (D-Calif.) had the information from this so-called “whistleblower” complaint back in August and he held it back while dropping vague, ominous hints.”
It now seems Democrats think they have at last found a real scandal they can use to move forward with impeachment hearings in the House. The new fake Trump scandal rolled out last weekend by the Democrats involves a phone call held on July 25 between President Trump and the newly installed President of Ukraine, Volodymyr Zelensky. An anonymous government official, described inaccurately as a ‘whistleblower,’ made an official complaint to the Intelligence Community’s Inspector General’s Office about some of the things Trump supposedly said during this call. According to the complaint that was filed, Trump tried to strong-arm Zelensky into agreeing to investigate former Vice President Joe Biden and his son, Hunter Biden. Biden is currently the frontrunner and favorite to win the Democratic nomination to run against Trump next year.
To pressure Zelensky into agreeing to investigate the Bidens, the anonymous leaker claimed Trump threatened to withhold military aid that had already been approved to Ukraine. So if true, this would indeed be a huge scandal, if a sitting President tried to coerce a foreign government into investigating or manufacturing a criminal probe of his political opposition. It is being reported that Rep. Adam Schiff (D-Calif.) had the information from this so-called “whistleblower” complaint back in August and he held it back while dropping vague, ominous hints. The same players in the Russiagate hoax were trying to launch a Ukrainian hoax using the exact same strategy: vague leaks based on anonymous sources so story after story could be rolled out in the fake news media alleging Trump crimes.
Only this strategy was instantly blown up this time, and in quite a savage fashion by this president. Trump now has his people in place and all the evidence has been collected. He didn’t need to wait to completely blow up this new Ukrainian narrative. This tells me Trump had his own counter-narrative all ready and waiting to launch whenever the Democrats and their DNC Media Complex allies tried this futile Ukrainian gambit.
Congress ignores its own vulnerability.
For an impeachment, the importance of public trust in our political institutions can’t be overstated. Generally speaking, the American polity can only afford impeachment when social cohesion and trust in public institutions is high. Congress has only initiated impeachment inquiries three times in U.S. history, and under circumstances far different than what we’re dealing with now. The two impeachment inquiries of the modern era, which resulted in very different outcomes, took place when the American people had far greater confidence in Congress.
In 1974, the same year Congress opened an impeachment inquiry against President Richard Nixon, Gallup began asking Americans about their approval or disapproval of Congress (a question asked of presidents beginning in the 1930s). That year, Congress received an average approval rating of 32 percent. By April of 1975, some eight months after Nixon resigned from office following the approval of three articles of impeachment against him, it was nearly 40 percent. In October 1998, when the Republican-controlled U.S. House of Representatives voted to commence impeachment proceedings against President Bill Clinton, Congress had a 47 percent approval rating. By the time the Senate trial began in January 1999, Congress’s approval rating had risen to 50 percent. Even after Clinton was acquitted, Congress maintained better than 40 percent approval.
Today, congressional approval is less than half that: a recent Economist/YouGov poll found job approval of Congress at just 14 percent. And of course it’s not just Congress. We’re living through a period when public confidence in all our institutions has collapsed, including organized religion, labor, big business, public schools, and the news media. Only 17 percent of Americans now say they can trust the government, compared to three-quarters when the question was first asked in 1958. In such an environment, congressional Democrats and the mainstream media should be at pains to prove their trustworthiness. But they’re doing just the opposite.
Merely an attempt to provide him with a podium on which to deny he killed Khashoggi. You can feel the spin doctors.
Saudi Arabia’s crown prince said in an interview aired Sunday that war with Iran would devastate the global economy and he prefers a non-military solution to tensions with his regional rival. “If the world does not take a strong and firm action to deter Iran, we will see further escalations that will threaten world interests,” Prince Mohammed bin Salman told the CBS program “60 Minutes.” “Oil supplies will be disrupted and oil prices will jump to unimaginably high numbers that we haven’t seen in our lifetimes,” the prince said. The prince said a war between Saudi Arabia and Iran would be catastrophic for the world economy.
“The region represents about 30 percent of the world’s energy supplies, about 20 percent of global trade passages, about four percent of the world GDP. Imagine all of these three things stop,” he said. “This means a total collapse of the global economy, and not just Saudi Arabia or the Middle East countries.”
While the US banned Huawei for alleged espionage and asked its allies to do the same, Moscow has rolled out the red carpet for the Chinese tech company, letting it develop 5G networks in Russia. Analysts say the move is as much a show of solidarity with Beijing against the US as it is a drive to bring ultra high-speed internet to Russian tech users. This month, Huawei opened its first 5G test zone in Moscow in partnership Russian operator MTS, with a view to rolling out the service to the rest of the capital. Moscow authorities say the network will become part of the city’s normal infrastructure within the next few years.
A pioneer in telecoms networks compared to many Western countries, Russia plans to deploy 5G in all of its main cities by 2024. When Chinese President Xi Jinping visited Russia in June — at the height of Washington’s conflict with Huawei — Russia’s main operator MTS signed a contract with the Chinese company. At the inauguration of the 5G zone in Moscow, the CEO of Russia’s branch of Huawei Zhao Lei praised the company’s activities in the country. “We have been working in Russia for 22 years. Thanks to our partners, we live well here,” he said. He added that Huawei, considered a world leader in 5G technology, plans to “lead in the development of 6G” in the future.
Which is less than 1% of capacity, while planning calls for a 30% increase in that same capacity.
China will aim to shut a total of 8.66 gigawatts (GW) of obsolete coal-fired power capacity by the end of this year, its energy regulator said, part of its efforts to curb smog and greenhouse gas emissions. The National Energy Administration didn’t say how much of the target, equal to just under 1 percent of total capacity, had already been met. All provinces and regions have been ordered to shut coal-fired power units with a capacity of less than 50,000 kilowatts (kW), the regulator said on its website on Sunday. Larger units of up to 100,000 kW in regions covered by large-scale power grids will also be eliminated, along with those that have reached the end of their designed service period, it said.
Central China’s Henan province, one of the country’s most polluted regions, is under pressure to shut 1.6 GW this year, while southeastern Guangdong province near Hong Kong will shut 2.3 GW. China has promised to ease its dependence on coal, and it has also forced most of its coal-fired power plants to install ultra-low emissions technology in a bid to curb smog. But while China has cut the share of coal in its total energy mix from 68% in 2012 to 59% last year, overall consumption has continued to increase and environmental groups estimate that it still has more than 200 GW of new coal-fired capacity in the pipeline. The China Electricity Council, which represents the country’s power industry, predicts that total coal-fired capacity could eventually peak at 1,300 GW, up from around 1,000 GW now.
US to target EU goods. Then EU can target US in 2020. They BOTH screwed up.
Transatlantic trade ties face renewed disruption this week when global arbiters are expected to grant the United States a record award allowing it to hit European imports with billions of dollars of tariffs in a long-running aircraft subsidy dispute. The World Trade Organization (WTO) has found that both European planemaker Airbus and its U.S. rival Boeing received billions of dollars of illegal subsidies in a pair of cases that have run for 15 years. Both sides have threatened tariffs after the Geneva body found neither adhered fully to its findings. However, the United States has a head start, with the European Union having to wait until early in 2020 to hear what level of retaliation it can exact over Boeing.
The WTO is expected this week to reveal the amount of EU goods the United States can target. People familiar with the case say the three-person tribunal is expected to award it around $7.5 billion, a record for the 24-year-old watchdog. Such retaliation rights are rarely granted by the WTO – most parties reach settlements – and in many cases complainants do not exercise their rights. The United States though has indicated it will target EU goods to the fullest extent. It has already published a $25 billion list from which it will pick items to target from aircraft and aerospace parts to wine, cheese and luxury goods.
Don’t hold your breath.
The FBI has expanded its investigation into Prince Andrew’s ties to dead pedophile Jeffrey Epstein. The UK’s Sunday Times reported that the FBI is attempting to “identify more of the billionaire’s victims, who could provide information on the royal.” According to their report, the FBI is planning to spend the next two months questioning alleged trafficking victims. They have reportedly briefed Scotland Yard to their plans and their UK counterpart has agreed to assist the investigation. “The US investigation is focusing on several potential victims in the hope that they can provide more details about Prince Andrew and his connection to the Epstein case,” a source from the Department of Justice told the Sunday Times. The source added that “they are not going to dismiss it [claims relating to Andrew] because he is a royal.”
The Duke of York has been accused of having sex with Virginia Roberts Giuffre when she was only 17, at the behest of Epstein and his alleged recruiter and groomer Ghislaine Maxwell. There is an infamous photo of her with the prince when she was very young, which he has claimed is fake. The royal has also been photographed inside the home of Epstein, as another young girl is seen leaving the apartment. The Times report says that Giuffre’s allegations are not the only ones they are looking into related to Prince Andrew. Law and Crime reports that “Dai Davies is Scotland Yard’s former head of royal protection and he personally oversaw Prince Andrew’s protection during the 90s. He said it was in the ‘public interest’ for authorities to investigate Prince Andrew now since London police previously shuttered an investigation based on claims made by Giuffre in 2015.”
This makes me think only of how people process the news these days.
We can pick out a conversation in a loud room, amid the rise and fall of other voices or the hum of an air conditioner. We can spot a set of keys in a sea of clutter, or register a raccoon darting into the path of our onrushing car. Somehow, even with massive amounts of information flooding our senses, we’re able to focus on what’s important and act on it. Attentional processes are the brain’s way of shining a searchlight on relevant stimuli and filtering out the rest. Neuroscientists want to determine the circuits that aim and power that searchlight. For decades, their studies have revolved around the cortex, the folded structure on the outside of the brain commonly associated with intelligence and higher-order cognition. It’s become clear that activity in the cortex boosts sensory processing to enhance features of interest.
But now, some researchers are trying a different approach, studying how the brain suppresses information rather than how it augments it. Perhaps more importantly, they’ve found that this process involves more ancient regions much deeper in the brain — regions not often considered when it comes to attention. By doing so, scientists have also inadvertently started to take baby steps toward a better understanding of how body and mind — through automatic sensory experiences, physical movements and higher-level consciousness — are deeply and inextricably intertwined.
“The secret of getting ahead is getting started”