Tuesday, February 5, 2019

The Year Of The Pig

Tonight, the Liar-in-Chief will give an update on the Great Wall of Trump, his monument to racism. The collapse of 2008 reversed decades of immigration growth. Which explains why Trump doubled down on corruption. There is method in his senility...

As we enter the year of the pig, we are reminded that not everyone was meant to see this coming.

Ironically, what border protection couldn't achieve, financial malfeasance had already achieved for them:

"The estimated number of undocumented immigrants living in the USA reached a 12-year low in 2016"

Researchers from the Pew Research Center, which conducted the analysis, said economics played a major role in that fall. The Great Recession wiped out millions of jobs that attracted undocumented immigrants to the USA, while the Mexican economy steadily improved, giving Mexicans more reasons to stay in their country."

Democrats finally figured out that the tax cut was human history's largest theft. Better too late than never. 

Before Reagan, stock buybacks were illegal, now they are 4% of GDP:

“Corporate America has cashed in on the Trump tax bill, but working America has been left behind”

The reason that stock buybacks were illegal is because they were seen as a form of market manipulation. A way for insiders to cash out at public expense. Today, that's just "corruption-as-usual":

It's far worse than even what they have described, because what stock buybacks represent is human history's largest leveraged buyout:  Of the U.S. economy.

Paid for mostly with insolvent corporate debt, now at the highest level in U.S. history.

Corporate debt, % of GDP:

In addition, the tax cut shifted consumption forward, accelerated rate hikes, and decimated the housing sector. Why? Because sadly there is no such thing as "free" money.

Economists used to call this effect "crowding out", before they collectively lost their minds, and decided that printing money is the secret to effortless wealth. 

Here we see banks with homebuilders. Both peaked one year ago when the tax cut took effect:

At the December low, U.S. Industrials had given up ALL two years of Trump gains.

Mostly due to the failed trade war which has expanded the U.S. trade deficit to the widest in history:

Even the "MAGA" trade is now failing. The world's largest stocks by market cap - Microsoft, Apple, Google, and Amazon ALL missed Wall Street expectations this quarter:

Defense stocks - the greatest beneficiary of Trump profligacy - have zero upside now that the newly expanded military budget is FULLY priced in:

This algo-driven delusion off the December lows is about one thing only  - getting the Wall Street pump and dump working again:

"There is an outside chance 2019 could be an all-time record for initial public offerings, passing even the legendary 1999 and 2000 years."

But for that to happen, a lot of things need to go almost perfectly. There can't be any more government shutdowns, market conditions have to exhibit low volatility and — most importantly — the public needs to have an appetite to buy very large IPOs at (potentially) very inflated prices."

What could go wrong?

Unfortunately speculators have already been bilked for the past year, and have nothing to show for it, except margin calls:

Which is why only drug stocks are making new highs:

I meant real drugs. 

"This is going to fix immigration for good"