Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Tag Archives: Stock Market

China Stock Market Off Sharply After Regulatory Crackdown

This article first appeared online at TheNewAmerican.com on Monday, January 19, 2015:

Chateau Lafite Rothschild Label for the 1999 v...

Chateau Lafite Rothschild Label for the 1999 vintage

During Monday’s session, stocks traded on the Shanghai stock market fell to their lowest level since June 2008, losing nearly eight percent.

Hardest hit were three brokerages that have been heavily involved in allowing Chinese small investors to open margin accounts, through which investors are able to borrow a portion of the money needed to buy securities, using the securities as collateral. When many of them were unable to settle their accounts, rather than forcing margin calls (a demand by a broker that an investor deposit further cash or securities to cover possible losses), the brokerage houses simply allowed them to

Keep Reading…

OPEC’s Hegemony is over

This article was first published at The McAlvany Intelligence Advisor on Monday, October 27, 2014:

English: Saudi Arabia

Saudi Arabia

Tim Treadgold, a Forbes contributor who watches the world’s energy markets, decided to break the journalist’s unspoken rule: never forecast the demise of an individual (or an institution) until he is holding the coroner’s report (or bankruptcy judgment) in his hand:

At grave risk of committing [that] cardinal sin … this time it might be different because OPEC is steadily losing control of the oil market….

The irony, he said, was staggering:

Keep Reading…

Stock Market Gains Failing to Bail Out Pension Plans

This article first appeared at The McAlvany Intelligence Advisor on Friday, September 26, 2014: 

Pension managers’ hopes that investment returns – i.e., pixie dust – would bail them out from their bad assumptions, and keep their plans solvent and fully funded so that they would be able to keep every promise made, have finally crashed on the rocks of reality. Just three months ago, the Center for Retirement Research at Boston College released a study showing that the shortfall between promises and assets to pay them for 25 of the largest public defined-benefit pension plans in the country amounted to more than

Keep Reading…

Scary Default Scenarios Based on Faulty Treasury Department Release

Within hours of the “brinkmanship” press release by the U.S. Department of the Treasury, major media began to repeat the highly dubious risks outlined by the department without reading carefully exactly what it contained. The headline and opening paragraph were all that the echo chambers needed:

Keep Reading…

The President’s Approval Ratings Continue to Drop

On Wednesday, August 7th, Fox News reported that President Obama’s approval rating was “in a summer swoon,” with just 42 percent of Americans approving of his performance. This was down 4 percentage points from July and 7 points from his 2013 high. In addition more than half of those polled

Keep Reading…

Central Banks’ bubble is bursting, sending markets down worldwide

When the Japanese stock market lost more than 6 percent of its value on Wednesday in a massive selloff, pundits jumped on the move to try to explain what happened, and what it all means. Evan Lucas, a market strategist at IG Markets, wrote:

Keep Reading…

Obamanomics is to Blame for Worst Recession since the Great Depression

When libertarian scholar Peter Ferrara asked rhetorically in Sunday’s issue of Forbes, “Economically, Could Obama be America’s Worst President?” he relied heavily on statistics provided by the chief enabler of the Great Recession,

Keep Reading…

Is Obama’s Support Finally Fading?

This article was originally published at the McAlvany Intelligence Advisor on May 22nd, 2013:

 

Last week’s poll by the Washington Post and ABC News showing the president’s rating remaining constant despite increasing public unhappiness with White House cover-ups over Benghazi and the IRS targeting scandals noted that his rating was tenuous at best:

The president’s approval rating, at 51 percent positive and 44 percent negative, has remained steady in the face of fresh disclosures about the IRS, the Benghazi attack and the Justice Department’s secret collection of telephone records of Associated Press journalists as part of a leak investigation…

But the stability of those ratings comes with an obvious caveat. Information continues to emerge

Keep Reading…

A very smart guy reviews Stockman’s massive new book

Whenever someone as smart as David Stockman (President Reagan’s Director of the Office of Management and Budget) writes a 768-page book (The Great Deformation), it makes me nervous, for two reasons: I don’t have the time to read 768 pages, but if I don’t I might miss something important. So I was gratified that

Keep Reading…

The coming Tobin Tax and Wall Street

I have watched in utter amazement as the stock market continues inexorably to climb to new highs nearly on a daily basis. I have wondered aloud and in writing how such an upward march could be justified. I have looked in vain. There is nothing going on in the economy that, in my opinion, justifies this. Smarter people than I have failed to find justification for it either. The markets don’t care, it seems. They just continue to move higher.

But perhaps Wall Street is watching something that is about to happen in Europe

Keep Reading…

The gap between Wall Street and Main Street widens

On Thursday, the last trading day of the first quarter of 2013, the Standard and Poor’s index of 500 stocks – the S&P 500 – closed  at 1569, four points above where it traded in October, 2007, just before it plummeted to 676 in March, 2009. With that news the sigh of relief on Wall Street was nearly audible. CNNMoney gushed:

Keep Reading…

Is the stock market real? Not according to consumers.

With the stock market steadily marching higher and setting new all-time highs (on a nominal, not inflation-adjusted basis), does this reflect what’s really going on in the economy? Not according to 5,000 households who

Keep Reading…

The numbers behind the Dow are simply awful

Just as the Dow and the S&P 500 are reaching new highs, many are suggesting further gains are possible. That’s why this summary of how things look when compared to October, 2007, the day the Dow hit its previous all-time high, is more than a little unnerving.

  • Regular Gas Price: Then $2.75; Now $3.73
  • GDP Growth: Then +2.5%; Now +1.6%
  • Americans Unemployed (in Labor Force): Then 6.7 million; Now 13.2 million
  • Americans On Food Stamps: Then 26.9 million; Now 47.69 million
  • Size of Fed’s Balance Sheet: Then $0.89 trillion; Now $3.01 trillion
  • US Debt as a Percentage of GDP: Then 38%; Now 74.2%
  • US Deficit : Then $97 billion; Now $975.6 billion
  • Total US Debt Outstanding: Then $9 trillion; Now $16.4 trillion
  • Labor Force Participation Rate: Then 65.8%; Now 63.6%
  • Consumer Confidence: Then 99.5; Now 69.6
  • S&P Rating of the US: Then AAA; Now AA+
  • Gold: Then $748; Now $1583

Years ago when I was on a speaking tour for the American Opinion Speakers Bureau, I showed a cartoon of a man climbing a ladder. On his back were the words “stock market.” The first panel showed him climbing. The second showed him climbing higher. The third panel showed him reaching the top of the ladder. The fourth panel showed him continuing to climb, without the ladder. It always brought a laugh. Everyone understood that the market had become totally detached from reality. So it appears to be today.

Here’s where the Dow has to be in inflation-adjusted terms in order really to break a new high. Using an inflation calculator (which assumes that the CPI is a fair measure of price inflation – a dubious assumption), in order for the Dow Jones Industrial Average to equal its high of 14,164 touched in October, 2007, it would have to be at 15,630. At the moment, following the bad news out of Cyprus, the Dow is at 14,473. It would have to gain 1,157 points, or another 8 percent, just to get back to where it was, in real terms, in October, 2007, five and a half years ago.

The stock market might just continue moving higher, just like the man in the cartoon. But at some point reality is bound to kick in.

Another 1987 black Monday coming?

Mark Hulbert has expressed serious doubt about the stock market’s ability to continue it climb upward.  As the Dow touches the magic 14,000 mark, it hesitates, pulls back slightly, and then tests that ceiling, only to repeat the process. Much is being made in the news that this is a “new high” in the Dow and things can only go higher:

Keep Reading…

The Gloomy Report from the CBO is Too Optimistic

On its face the latest report from the Congressional Budget Office is gloomy enough, but careful sifting through it reveals

Keep Reading…

Where Are the Spending Cuts?

Cutting your Spending

Cutting your Spending (Photo credit: Tax Credits)

The fiscal cliff “deal” about to be signed into law by President Obama is all about tax increases. This is what The One has wanted since he got into office. He wanted to overload the system so much that taxpayers would be forced to pay more. It’s more of the “leveling” required to push the US down relative to other deadbeat nations who also can’t pay their bills. The easier to be “absorbed” into the new world order run by non-elected elites. But I digress…

According to the Congressional Budget Office (CBO), the “deal” consists of $15 billion in spending cuts (over the next ten years, mind you) compared to $620 billion in new taxes – a ratio of 41:1. What a deal!

“We’ll address spending cuts later” is now the cry from sycophants like Grover Norquist. “We got a deal we can live with,” they say. “Now let’s get down to business.”

Sorry. Business is already done. That window of opportunity to hold the government accountable is closed. Obama got what he wanted. Boehner caved in. End of discussion.

I’m biased (!). But I think the fiscal cliff turned out to be a speed bump on the road to more

Keep Reading…

Senator Harkin Tries to Revive High-Frequency Trading Tax Bill

Senator Harkin Visits Downtown School

Senator Harkin Visits Downtown School (Photo credit: Phil Roeder)

More than a year ago Senator Tom Harkin (D-Iowa) introduced legislation to impose a tax on high-speed trading and it has languished in the Senate ever since. On Thursday he had a chance to breathe some life into the measure in an interview at MarketWatch.com during which he offered the same platitudes from a year ago.

High-frequency trading, he said, generates no benefit to the economy and therefore could be taxed with little negative impact. Such a tax could raise an estimated $350 billion over the next ten years, he added:

 I really don’t see any evidence that these high-speed traders add anything to the economy, but they do also create some aberrations in the market that have led to some disturbances.

On the one hand, my transaction tax doesn’t put them out of business but certainly they would have to pay 3 cents on every $100 in transactions they do. That’s really not very burdensome.

But also we need revenue. We have to get out of this deficit hole we’re in and this transaction tax is estimated to raise about $352 billion over ten years. That’s pretty substantial. And I don’t think it will do anything at all to hurt trading, what I call “real trading.”

This is a rehash of statements he made on his website back in November, 2009 when he, along with Representative Peter DeFazio (D-Ore.), introduced his bill. He explained then that it would be

Keep Reading…

Pro Teams Losing Games and Fans

Miami Dolphins fan / Torcedor do Miami Dolphins

Miami Dolphins fan / Torcedor do Miami Dolphins (Photo credit: marciofleury)

In an interesting study, 247Wallst.com counts 13 professional sports teams that are losing games, fans and money, and that many appear to be in a death spiral: they don’t have the money to hire the best players, so the players they are able to hire don’t play as well, so they lose games, and the fans lose interest, and so the owners have less money to hire the best players, and down and down they go.

Since this is football season, let’s look at the Miami Dolphins. During the 2001-2002 season, the team won 11 games and lost 5, putting them in first place in the AFC East.  The beat the Colts in the first playoff game but were shut out by

Keep Reading…

Keynesians are Crazy! Here’s Proof:

English: Japanese Prime Minister Shinzo Abe at...

Japanese Prime Minister Shinzo Abe at the G8 summit in Heiligendamm. (Photo credit: Wikipedia)

For 20 years the Japanese economy has languished. Its stock market, once at 40,000, now is below 10,000. The solution? More of the same medicine that hasn’t worked! It’s insane. At least one intelligent soul has written about it, in The New York Times no less. He calls such policies “unusual”:

For years, proponents of aggressive monetary policy have offered this unusual piece of advice as a way to end Japan’s deflationary slump and invigorate the economy. Print lots of money, they said. Keep interest rates at zero. Convince the market that Japan will allow inflation for a while.

It hasn’t worked. For 20 years it hasn’t worked. So now, Japan’s former prime minister has a great idea:

In a speech in Tokyo on Thursday, Mr. [Shinzo] Abe said he would call for the Bank of Japan to set an inflation target of 2 to 3 percent, far above its current goal of about 1 percent, with an explicit commitment to “unlimited monetary easing” — an open-endedness that has caused jitters among some economists. The bank’s benchmark interest rate should be brought back to zero percent from 0.1 percent, Mr. Abe added.

Abe wants to do even more. He proposes that Japan’s central bank buy construction bonds to

Keep Reading…

Keynesian Economists Nervous About Fiscal Cliff

DAVOS/SWITZERLAND, 25JAN07 - Maria Bartiromo, ...

Maria Bartiromo, Anchor, CNBC’s Closing Bell, and Host and Managing Editor, Wall Street Journal Report, CNBC, USA; (Photo credit: Wikipedia)

Maria Bartiromo is the majorette domo of television investment broadcasting. She is also a Keynesian. From her bio:

She is a member of the Board of Directors of the Young Global Leaders of the World Economic Forum, a member of the Council on Foreign Relations [and] the Economic Club of New York… (my emphasis)

Bartiromo graduated from New York University, where she studied journalism and economics.

Rest assured good friends that NYU doesn’t teach Austrian School economics. And membership in the CFR guarantees that anything she says or writes will be the elite Anglo-American establishment’s view.

And she is getting nervous about the fiscal cliff:

The ongoing fight over the “fiscal cliff” may overshadow everything else as we get closer to the new year. Sadly, compromise seems hard to come by, even though the consequences of going over the cliff — hundreds of billions of dollars of spending programs that are set to expire, along with the largest tax increase since World War II for virtually all income levels — was specifically designed to force compromise.

Obama has dug in his heels: no deal unless

Keep Reading…

Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.