2017: A Review Of The Fed, Treasuries, Mortgages and Housing (Volatility and Velocity)

This is a syndicated repost courtesy of Snake Hole Lounge. To view original, click here. Reposted with permission.
2017 has been an interesting year. Donald Trump was elected President and seated in January 2017. The Federal Reserve kept rates near zero with a massive balance sheet for almost all of Obama’s 8 years as President, then started to raise rates and unwind their massive balance sheet AFTER Trump was elected. Note the decline in M2 Money growth after Trump’s election.

This post was published at Wall Street Examiner by Anthony B Sanders ‘ December 23, 2017.

Novo Resources Is Not Worth $600 Million

Novo is not worth the $544 million market cap based on Friday’s close using fully-diluted shares. Novo might eventually be worth $600 million or even more. But that reality is several years away. I have been recommending selling to my Mining Stock Journalsubscribers for several months. I don’t just ideas to buy, I help my subscribers avoid stocks that are overvalued, for whatever reason.

This post was published at Investment Research Dynamics on December 23, 2017.

“I’m Truly Starting To Fear The Worst For The US Car Industry…”

Authored by Ethan Gaines via A Cold War Relic blog,
I love selling cars, the industry gave me a purpose after the shitty experience of being a corporate cog. But I’m truly starting to fear the worst for the American car industry.
The industry has shown growth since the dark days of the recession but the business model morphed into an ugly free for all.
Automotive credit has become easier in the last few years, and manufacturers are still seeking whatever growth they can come up with in our market at any cost.

This post was published at Zero Hedge on Dec 22, 2017.

The West Proves That Poland’s Loyalty Was Worthless

Authored by Andrew Korybko via Oriental Review,
Poland, one of the most loyal EU members, was just stabbed in the back by Brussels after the bloc initiated punitive Article 7 proceedings against it, proving that Warsaw’s unwavering loyalty to the West was worthless this entire time and thus giving Poles a reason to reconsider whether it’s time that they attempted to restore their long-lost Great Power status in Europe.
Many Poles were shocked to hear that Brussels had begun the process to sanction their country, despite knowing in the back of their minds all along that this was a very probable scenario. The EU had been warning Poland for months now that it wouldn’t tolerate the ruling Law & Justice party’s (PiS) judicial reforms, labelling them as ‘anti-democratic’ in spite of the same envisioned changes already being in place in many Western European countries. All that PiS wants to do is make it so that judges are accountable to the people, not to one another, and break the backs of the communist-era clique that still controls the country’s courts. This is crucial in the modern context because PiS follows a EuroRealist ideology that aspires to improve Poland’s sovereign standing in the EU, a vision which is directly at odds with EU-hegemon Germany’s EuroLiberalism that instead wants all member states to be subservient to an unelected bureaucracy in Brussels.
EuroRealism vs. EuroLiberalism
The matter is an urgent one for Poland because PiS’ Civic Platform (PO) predecessors stacked the courts with their allies before leaving power after the ruling party won the first-ever post-communist electoral majority in the country’s history in 2015. PO’s former leader is the current President of the European Council Donald Tusk, and he and his organization are popularly regarded as Germany’s proxies in Poland. PiS, on the other hand, is allied with Hungary Prime Minister Viktor Orban’s Fidesz party, with which it shares a strident belief in the conservative ideology of EuroRealism. It had long been the case that EuroLiberalism was on the ascent in Europe ever since the end of the Cold War, but the 2008 global economic recession and the 2015 Migrant Crisis sparked a grassroots movement all across Central and Eastern Europe which has seen the rapid rise of EuroRealism.

This post was published at Zero Hedge on Dec 23, 2017.

Zuesse: Americans Are Only Now Beginning To Learn They Live In A Dictatorship

Authored by Eric Zuesse via The Strategic Culture Foundation,
The first time when it became clear to me that I live in a dictatorship was in 2014 when reading, prior to its publication, the landmark (and still the only) scientific empirical study to address the question as to whether or not the United States federal Government is, authentically, a democracy – or, whether, alternatively, it’s instead more of a dictatorship, than a democracy.
This study documented conclusively that America’s Government is the latter.
So, on 14 April 2014, I headlined ‘US Is an Oligarchy, Not a Democracy, Says Scientific Study’. Subsequently, my editor linked it to the published article at the Journal where the study was published, Perspectives on Politics, from the American Political Science Association, and the full study can be read there.

This post was published at Zero Hedge on Dec 22, 2017.

Consumers Are Smarter than Bureaucrats Think

Despite the name of this government agency, Canada’s Competition Bureau lacks an appreciation of the nature of competition. Moreover, the Bureau’s actions can be seen as an insult to Canadians, as it fails to acknowledge the ability of discriminating consumers to recognize uncompetitive offerings. As the Bureau pretends to be the consumers’ guardian angel, it wastes taxpayers’ dollars on counterproductive activities.
The Hudson’s Bay Company (HBC) operates numerous department stores in Canada. They say they have spent more than US$425,000 and invested more than 6,500 person-hours to produce 37,000 documents in response to the Competition Bureau’s complaint made last February. According to The Canadian Press, the Competition Bureau
is suing Hudson’s Bay Co., alleging that the retailer engaged in deceptive pricing practices for four years …
The Competition Bureau claims HBC misled customers over the prices of mattresses and box springs sold together since at least March 2013 …
‘The regular prices of the sleep sets were so inflated above what the market would bear that sales at the regular price were virtually non-existent,’ reads the filing.
HBC listed a Mount Royal tight top queen sleep set at $1,998 and then a sale price of $788 in 2014, for example, but never sold one at the regular price, the agency says.
So, HBC supposedly ‘engaged in deceptive pricing practices’ which the Bureau defines as misleading customers about prices. Nonsense. The Bureau reveals its own bureaucratic idiocy when it contradicts itself by admitting that no sales were made at the inflated price.

This post was published at Ludwig von Mises Institute on December 23, 2017.

Mexico Suffers Deadliest Year Ever: Violence Hits Cabo, Tourist Havens

Local authorities near the beautiful tourist town of Los Cabos on the Baja California peninsula found six bodies suspended from three different bridges this week.
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Authorities did not want to comment on the details surrounding how the men got onto the bridges, but Reuters suspects ‘drug gangs’, who often hang the bodies of their murdered rivals in public for intimidation purposes.
According to official data in November, there were more murders in October in Mexico than any other month over the past 20-years.
Mexico is on track to have the deadliest year ever since modern records began. In the first 10-months of 2017, there were more than 20,878 murders nationwide, as many in the war-torn country have blamed President Enrique Pena Nieto’s failure to tackle drug violence.
One local prosecutor said in a statement to Reuters,
Two bodies were found on a bridge in Las Veredas, near Los Cabos International Airport, and two on a different bridge on the highway between Cabo San Lucas and San Jose del Cabo, local prosecutors said in a statement.
In a separate statement, the prosecutors said two further bodies were found on a third bridge near the airport.

This post was published at Zero Hedge on Dec 22, 2017.

Doug Noland: Epic Stimulus Overload

This is a syndicated repost courtesy of Credit Bubble Bulletin . To view original, click here. Reposted with permission.
Ten-year Treasury yields jumped 13 bps this week to 2.48%, the high going back to March. German bund yields rose 12 bps to 0.42%. U. S. equities have been reveling in tax reform exuberance. Bonds not so much. With unemployment at an almost 17-year low 4.1%, bond investors have so far retained incredible faith in global central bankers and the disinflation thesis.
Between tax legislation and cryptocurrencies, there’s been little interest in much else. As for tax cuts, it’s an inopportune juncture in the cycle for aggressive fiscal stimulus. And for major corporate tax reduction more specifically, with boom-time earnings and the loosest Credit conditions imaginable, it’s Epic Stimulus Overload. History will look back at this week – ebullient Republicans sharing the podium and cryptocurrency/blockchain trading madness – and ponder how things got so crazy.
From my analytical vantage point, the nation’s housing markets have been about the only thing holding the U. S. economy back from full-fledged overheated status. Sales have been solid and price inflation steady. While construction has recovered significantly from the 2009/2010 trough, housing starts remain at about 60% of 2004-2005 period peak levels. It takes some time for residential construction to attain take-off momentum. Well, liftoff may have finally arrived. As long as mortgage rates remain so low, we should expect ongoing housing upside surprises. An already strong inflationary bias is starting to Bubble. Is the Fed paying attention?

This post was published at Wall Street Examiner on December 23, 2017.

Canadian Housing Affordability Hits 27 Year Low

Nothing says Merry Christmas like a 27 year low for Canadian housing affordability. That’s right, real estate across Canada has not been this un affordable since the year 1990 per RBC. Spoiler alert house prices tumbled shortly thereafter.
RBC Bank released their updated Q3 numbers for housing affordability. To no surprise, Vancouver leads the nation in the most unaffordable market to buy a home. Followed by Toronto and then Victoria.

This post was published at Zero Hedge on Dec 22, 2017.

Kushner’s Records At Deutsche Bank Subpoenaed As Mueller Avoids Trump

As it turns out, President Trump’s legal team was telling the truth when it said that Special Counsel Robert Mueller hadn’t subpoenaed financial records related to the president’s business activities from German lender Deutsche Bank, contrary to Bloomberg reporting.
On Friday, the New York Times reported that Deutsche Bank had received a subpoena for records on accounts linked to the Kushner Companies, the family real-estate empire of Trump son-in-law and senior adviser Jared Kushner. This contradicts reports by both German and US media organizations dating back to July which insinuated that Mueller had been digging into Trump’s multi-decade career in real estate. Even after his infamous bankruptcies in the 1990s, Trump managed to maintain a functioning lending relationship with Deutsche, which has lent him and his businesses hundreds of millions of dollars over the years.

This post was published at Zero Hedge on Dec 22, 2017.