After the most unprecedented denigration of a presidential candidate in US history, the worst may be yet to come, beginning Friday with Trump’s inauguration as America’s 45th president. Pro-Hillary dark forces call him illegitimate. Media scoundrels beat on him relentlessly. Whatever he does or says or doesn’t do or doesn’t say is criticized. Nothing in memory resembles what’s gone on since mid-2015. The problem isn’t Trump. It’s America’s debauched system – fantasy democracy, not the real thing.
Called “dai chi” in Chinese—literally, holding something on someone’s behalf—the trading practice resembles a short-term loan backed by bonds, and it has boomed as China’s bond market rallied during the past three years, according to half a dozen traders and executives at Chinese financial companies who have engaged in or are familiar with the practice. Typically, sellers pledge to buy the bonds back after terms ranging from a few days to a few months, paying interest on the value of the securities as well as an added fee, the people said. The trade lets the buyer lock in a higher price, while the seller hopes that by the time it buys the bonds back, market prices will have appreciated even further….These transactions also, by one estimate, may easily top $1 trillion in value. The practice is just one of the many unexpected risks that have sprouted up in China’s long credit boom.
In seasonally-adjusted terms, weekly earnings did not keep pace with largely oil prices all throughout last year. Weekly earnings started out 2016 at $368.80 (constant 1982-84 dollars) and ended at just $366.95. This is, of course, nothing new. It has been a constant feature the whole of what should have been recovery, where first and foremost the lack of income growth suggests “something” seriously wrong that no QE or “stimulus” policy can or will fix. The shift in real earnings in 2016 is due to both oil prices as well as the lack of nominal wage growth, with the latter far more important than the former. For an economy near or even at most economists’ definition of “full employment” for going into a third year, the lack of wage and income acceleration really is damning.
Russian President Vladimir Putin on Tuesday dismissed challenges to the legitimacy of President-elect Donald Trump’s election victory, saying Trump’s detractors “fabricate information and use it in the political struggle; they are worse than prostitutes; they have no moral limits.” Putin, speaking at a news conference in Moscow, scoffed at a privately prepared dossier claiming Russian operatives obtained unverified, salacious and potentially compromising personal and financial information about the president-elect. Trump, who is inaugurated this Friday, has dismissed the dossier as “fake news.”
China’s benchmark money-market rate jumped the most in two years, with record central bank cash injections being overwhelmed by demand before the Lunar New Year holidays. The People’s Bank of China put in a net 410 billion yuan ($60 billion) through open-market operations on Wednesday, the biggest daily addition since Bloomberg began compiling the data in 2004. That brings the total injections so far this week to 845 billion yuan. The interbank seven-day repurchase rate jumped 35 basis points, the most since December 2014, to 2.76 percent, according to weighted average prices.
This is another private equity story. PE firm Sun Capital Partners bought a majority stake in The Limited in 2007, during the grand wave of leveraged buyouts (LBO), including those of retailers. These PE firms that were gobbling up retailers and loading them up with debt were all hoping to make a killing on the new American prosperity and then sell those chains in IPOs down the road. But that plan has collapsed. The Financial Crisis intervened, and they’d failed to consider the devastating impact of online sales on brick-and-mortar stores.
Decentralization, pushback against the empire, questioning the narrative; Trump is unleashing it all….. Responding to Trump’s comments that Merkel had made an “utterly catastrophic mistake by letting all these illegals into the country”, [Germany’s deputy chancellor and minister for the economy, Sigmar] Gabriel said the increase in the number of people fleeing the Middle East to seek asylum in Europe had partially been a result of US-led wars destabilising the region. “There is a link between America’s flawed interventionist policy, especially the Iraq war, and the refugee crisis…
The last time Congress changed Social Security in a significant way with a series of benefit cuts and payroll tax increases was in 1983 under President Ronald Reagan. Back then, the federal government needed to fill a funding gap of about 1 percent of taxable workers’ wages. By the time Social Security’s trust funds are projected to run out in the early 2030s, the federal government will have to plug a hole of more than 3 percent, according to estimates by Charles Blahous, a senior research fellow at George Mason University’s Mercatus Center…..”Just to keep the system afloat from year to year at that point they would have to inflict near-term pain over three times as severe as was the case in 1983,” Blahous said.
If the dollar is devalued as Trump et al desire, and we get back cheaper dollars in return for our toil, then the sole purpose of our work is taken from us. It’s taxed away by devaluation. We get cheapened dollars that buy less in return for our work. Devaluation robs us. Yet Trump thinks the dollar is “too strong.” Ok, but if it’s cheapened we have a reduced incentive to produce in the first place. Why work for dollars that don’t buy very much? Also, if we’re not buying from others, how can they buy from us? These minor little details are never asked by a political class so intent on devaluing the money we earn.
Fake news has been a hot topic recently. All sides of the political sound and fury surrounding the recent presidential election have leveled charges and counter-charges against their opponents in this regard. Democrats, embracing a newfound, touchingly naive faith in the CIA and the other agencies of the so-called intelligence community, have claimed that the Russians hacked the Democratic strategists’ electronic files, released the information gained thereby, and hence influenced the election in Trump’s favor, costing Clinton the victory she so amply deserved. Republicans have responded that such claims at best evince sour grapes and an attempt to shift the public’s attention from the substance of the revealed messages to the identity of the messengers who allegedly made them public. At the same time, libertarians and others have called attention to the fact that the government itself is and long has been a leading, if not the leading, propagator of fake news—sometimes called simply propaganda—in its various attempts to sway public opinion and diminish resistance to its schemes for aggrandizing its own power and enriching the crony capitalists on whom it relies for its principal financial support, especially during the electioneering season.