Tag Archives: politics

Everything Is Crazy and the Markets Arent Freaking Out

At Credit Suisse Group AG’s prime brokerage desk in midtown Manhattan, the phone hardly seems to ring anymore. Its hedge fund clients don’t call about Donald Trump’s tweetstorms and the stock market or ask what to do when terrorists attack. And there was barely a whiff of panic when North Korea erupted in August. “Two rockets flew over the land mass of Japan and nothing happened,” says Mark Connors, Credit Suisse’s global head of risk advisory. “There were no calls. That’s absolutely crazy.”

Crazy maybe, but it’s become the norm on Wall Street. Whether it’s the threat of nuclear war, hurricanes, or Russian meddling, it seems nothing can unnerve investors bent on pushing the U.S. stock market higher and higher. Even Richard Thaler, who won a Nobel Prize last week for explaining how irrationality drives financial markets, said on Bloomberg Television he couldn’t understand why stocks keep going up now.

So what’s going on? After all, during most of the first 8½ years of the bull market, the mood was paradoxical. Although stocks rose, many investors scarred by the financial crisis acted as though they hated owning shares again, and every obstacle was framed as the next big meltdown (even as the underlying fundamentals remained strong). Now, everywhere you look—swelling stock valuations, hot sales of new cryptocurrencies, IPO shares with no voting rights—investors are embracing their speculative side. In the language of Wall Street, every day it’s “risk-on.”

Pundits are sounding alarms, but traders say the about-face in investors’ psyche is not without precedent and is about what you’d normally expect in the late stages of a long-lasting bull market. Sure, it’s an uncertain world out there, but fear invariably turns into greed, and the fear of missing out overshadows any anxiety about the next crash. That tends to quickly draw money back into the market every time it wobbles, despite legitimate worries about high valuations. “We certainly all joke about it: Buy the dip, that’s what we’ve been conditioned to do,” says Benjamin Dunn, president of the portfolio consulting practice at Alpha Theory, which works with money management firms. “Now you kind of have to do it. It’d almost be irresponsible not to.”

This year, the S&P 500 index has hit records on almost four dozen different occasions, with the single biggest drop from the latest record amounting to less than 3 percent. More than $3.2 trillion of market value has been added to U.S. equities, and volatility is at an all-time low. It’s easy to say it’s all about Trump and his promise of big tax cuts. His election has fueled some impressive gains (though perhaps not quite as impressive as he has often claimed and still far short of the best year for U.S. stocks during this current cycle). But for Credit Suisse’s Connors, the shift in market psychology can be traced back to a different signal event: Brexit.

After the U.K. voted to leave the European Union in June 2016, $2.6 trillion was wiped off the value of equities worldwide in just three days. Many were calling it one of the most dramatic and shocking turns of events in modern British history. Among investors, the panic was palpable, and some were paralyzed with fear. But almost as quickly, the markets roared back and jolted investors out of their crisis-era fatalism. Since then, naysayers selling into any weakness have looked like suckers. In the aftermath of other post-crisis upheavals, “we got a lot of incoming client calls,” Connors said. “But that all ended with Brexit. Now, even though the events seem dire, volume is low and and reversals are sharp. People are looking through to things that keep them long. Buy-the-dip is in place.”

Ed Yardeni, the 67-year-old former chief economist for Deutsche Bank AG who now runs his own research firm in New York, was in Texas recently on an annual client visit. In hurricane-ravaged Houston, locals were still dealing with the aftermath of Harvey, and two clients couldn’t meet because of damaged buildings. Yet there was one thing on everyone’s mind. “They wanted to talk about the potential for a stock market melt-up,” he says. A melt-up is a last-gasp surge like the one in 1999, when the Nasdaq doubled—just before it crashed. Nothing like it has happened in this bull market. To the extent 2017 has a precedent, the current backdrop is closer to 1995 or 2013, when the S&P 500 gained 30 percent or more with barely a peep of turbulence.

The problem, according to Wedbush Securities Inc.’s Ian Winer, is that all the things underpinning the gains, from robust earnings and the Federal Reserve’s low interest rate policy to the falling dollar and the retreat of sellers, has created a sense of invincibility. “Is the risk priced into the market appropriate to what the real risk is?” says Winer, the firm’s director of equities. “To me, it isn’t. People have grown more complacent and certainly more speculative, and it’s a little bit frightening.” One sign that investors are increasingly willing to pay more for less: Compared with the combined sales of all its companies, the S&P 500 is trading at its highest level since 2000.

Nevertheless, it’s far from obvious what will trigger the next downturn or when investors should get out. The hazards of market timing were illustrated by a Bank of America Corp. study last year, which showed that missing the very end of a bull market often means missing a quarter of its gains. What’s more, anyone who owned stocks just before they crashed in the worst bear market since the Great Depression would still have doubled their money as long as they had the fortitude—and enough of a financial cushion—not to bail.

For Vanguard Group Inc., whose trillions of dollars in low-cost and index-tracking funds are both credited and blamed for the current market mood—because so many retail investors have decided just to buy a diversified fund and forget about it—the new mindset is a sign of a job well done. “To see people not trading wildly on political news is optimistic,” says Fran Kinniry, a principal in Vanguard’s investment strategy group. “Investors are acting in a very positive way, how a professional investor should be investing. Have an asset allocation and rebalance it, and do your best to differentiate between the noise vs. reality.”

    Read more: http://www.bloomberg.com/news/articles/2017-10-16/a-crazy-stock-market-is-punishing-sellers

    Dreamers on DACA’s end: ‘We will not be thrown back into the shadows’

    (CNN)Protesters rallied Tuesday against the Trump administration’s plan to end a program that protects young undocumented immigrants from deportation.

    “We are here because I am angry. I am tired of how the immigrant community is treated,” Jose Luis Santiago, a DACA recipient, told CNN en Español at a protest outside Trump Tower in New York. “It is time to take action.”
    In Washington, Gustavo Torres, executive director for the immigrant advocacy group CASA de Maryland, told a demonstration Trump lied to immigrants.
      “For many months, he has been telling us, ‘I love the Dreamers.’ You remember that?” Torres said, referring to the group of undocumented immigrants who were brought to the United States as children.
      “He’s lying. He’s a person we cannot trust because, you know why? He’s racist.”
      Greisa Martinez, director of advocacy for the immigrant rights group United We Dream, said she and other Dreamers are “here to stay,” an often-used hashtag on social media.
      “United We Dream is ready (to) fight back,” Martinez said at a protest across from the White House. “We know this is a symbol of what we saw in Charlottesville, (Virginia) another sign of white supremacists taking over. We will not be thrown back into the shadows.”
      US Attorney General Jeff Sessions announced Tuesday the Trump administration would rescind the Deferred Action for Childhood Arrivals program, or DACA, an Obama administration policy.
      The program had protected nearly 800,000 young undocumented immigrants brought to the United States as children from deportation.
      The Trump administration also said it would continue renewing permits for anyone whose status expires in the next six months, giving Congress time to act before any of those currently protected lose their ability to work, study and live without fear in the United States.
      Trump’s move was praised by groups who support stricter immigration controls and have long decried DACA as executive overreach and argued that it’s akin to providing amnesty for lawbreakers.
      “President Trump has indicated that he is willing to forge a long-term solution for real immigration reform,” the Federation for American Immigration Reform said, “but it takes two sides to make a deal. The American public is watching.”
      Dreamers and their supporters held protests across the nation.
      In New York, demonstrators chanted “we are here” in Spanish as they marched down Fifth Avenue toward Trump Tower. They sat, locked arms and blocked traffic.

      HEROES #daca #mentalhealth #defenddaca #lgbt #lgbtq #lgbt🌈 #forex #forextrader #forextrading #forexmarket #stocks #stockexchange #nasdaq #bitcoin #memesdaily #meme #today #💯 #😂 #❤️ #😍 #mentalhealthawareness #😎 #depression #anxiety #🇺🇸 #Texas #California #newyork #houston

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      Reporters witnessed several individuals taken into police custody, but it’s unclear if they were arrested. Organizers had previously told CNN this was a planned act of civil disobedience.
      Students at Denver schools, as well as some teachers and college students, walked out of classes to protest the DACA order.
      They carried signs that said “Deport Trump” and one wore a T-shirt that said, “They tried to bury us. They didn’t know we were seeds.”
      Marissa Molina, 25, said she came to the United States with her family when she was 9 and now works as a teacher.
      “I told the kids if I was home I would probably be really sad, but I am with you so I am ready, I am ready to keep going — whatever that means,” she said.
      Cristian Solano-Córdova said he’s a college graduate and came to support the younger Dreamers. He remained optimistic in the face of the Trump administration decision.
      “DACA may be dead but our dreams are not,” he said.
      Demonstrators also took to the streets in Phoenix, Cincinnati, Detroit, Boston, Chicago, Minneapolis and Milwaukee to protest the decision to rescind DACA.
      DACA recipient Humberto Marquez traveled from Arkansas to protest Tuesday in Washington.
      “I was already mentally prepared for this decision. There had been a lot of rumors. But I think that this decision, what it means to me is a lot of frustration and anger, but at the same time, I am very certain that our community is going to stand up, as it always has,” Marquez told CNN en Español shortly after Sessions’ announcement.
      “This is not the first time that something positive has failed. So we are going to continue. We are going to keep pushing. We are going to keep fighting. We are here to stay.”
      Correction: A previous version of this article misidentified the name and gender of Cristian Solano-Córdova.

      Read more: http://www.cnn.com/2017/09/05/politics/daca-dreamer-reaction/index.html

      44 ways to judge the Obama era

      Washington (CNN)President Barack Obama, the 44th commander in chief of the United States, caps off eight years in office on January 20.

      CNN gained unique access inside the White House to document President Barack Obama’s final days. Watch “The End: Inside the Last Days of the Obama White House” on Sunday Jan. 22, at 8 p.m. ET/PT.
      Those eight years saw the nation grapple with the worst economic disaster since the Great Depression. The country’s response to that crisis helped reshape the economy and the makeup of the political system a few times over. And for every day of those eight years, the nation was at war — on multiple fronts, against multiple groups for multiple purposes.
      All of these momentous changes during Obama’s presidency had very real effects on people across the country and the globe. And for each of these real-world impacts, there is a number.
      CNN Money has charted the Obama economy while The New York Times has explored 2016 in numbers. Here, 44 statistics open a window to the 44th President’s expansive impact.

      1. Unemployment

      The recession cost many people their livelihood. The following years saw many of those same people gain it back. While part of the drop in unemployment came from people leaving the workforce, enough people have jobs now that, statistically speaking, employment has recovered from the darkest days of the economic crisis.
      According to the Bureau of Labor Statistics‘ seasonally adjusted unemployment rate:
      • When Obama came into office during January 2009, the unemployment rate was 7.8%.
      • The highest point in the data set came in October 2009, when unemployment hit double digits at an even 10%.
      • The final unemployment report under Obama put the unemployment rate at 4.7% for December 2016.

        2. Oil

        Due in part to a revolution in domestic fossil fuels and massive oil production overseas, oil and gas have been pretty cheap for some of Obama’s presidency.
        Here’s what the situation looks like.

        3. The stock market

        Following years of upward climb and a rally after President-elect Donald Trump’s electoral victory, stocks are near record highs.
        Here’s stock market performance as of January 3, 2017:

        4. Down-ballot races

        Obama’s election coincided with Democratic victories across the nation and the strong 2008 showing built on the party’s successes in 2006. But as the years went on, the situation virtually reversed itself. Obama will exit office with the Republican Party resurgent on the state and federal levels.
        Here’s the breakdown for state government, according to the National Conference of State Legislatures:

        Here’s the breakdown for the US Congress, according to the Senate and House of Representatives.

        5. Opioid crisis

        Deaths from opioid-related overdose deaths have been on the rise. More people are dying from overdoses on heroin and prescription pain medicine like oxycodone and fentanyl.
        The National Center on Health Statistics and CDC WONDER report the number of opioid-related overdose deaths nationwide:

        6. Pot laws

          States with legal marijuana or cannabis products have blossomed under Obama. When he took office, recreational marijuana wasn’t legal in any state.
          Here’s what marijuana legalization looks like now, with information compiled by CNN Health:
          • Recreational: 8 states + the District of Columbia
          • Medical: 19 states
          • Medical CBD: 11 states

          7. Medicaid expansion

          The Affordable Care Act set aside funding for states to expand Medicaid — a government health care program for the poorest Americans. But the process became something of a tussle with state governments and many of their Republican leaders. By the end of Obama’s presidency, only the slim majority of states had opted to expand Medicaid.
          The District of Columbia and 31 states expanded Medicaid, per the Kaiser Family Foundation.

          8. Insurance coverage

          As the economy recovered and the Affordable Care Act, also known as Obamacare, reformed the health care market, more people had health insurance coverage.
          Here’s the total percentage of people without insurance, according to the US Census Bureau’s American Community Survey:

          9. National debt

          By the end of Obama’s presidency, government debt had nearly doubled to about $20 trillion.
          To be specific, the Treasury Department as of January 13, 2017, pegged the total public debt outstanding at $19,940,614,376,504.40.

          10. Deportation

          Trump said during his campaign that he’d create a special force to deport undocumented immigrants. Although Obama criticized Trump’s immigration proposals, he detained and deported millions of men, women and children. Obama’s administration deported the most people — 434,015 — in 2013.
            Here are total “removals” of people according to the Department of Homeland Security’s 2015 yearbook of immigration statistics (the most recent year for which data are available):

            11. Interest rates and inflation

            The Federal Reserve increased its interest rate by .25% in December 2016 for the second time since the financial crisis. The rates had been cut to zero in 2008. Many were concerned the Fed’s easy money policies would cause inflation to skyrocket. Instead, inflation hasn’t risen by much yet for years.
            Here’s the rate of inflation, per the Minneapolis Fed.

            12. The car industry

            General Motors (GM) was down to 75 cents a share in May 2009.
            As of January 3, 2017, GM’s stock was up to $35.15.

            13. Inequality

            The US has grown more unequal over the past few decades, including the past eight years.
            One commonly cited measure is the Gini index. The number ranges from zero to 1, and the higher the Gini index is, the more unequal the distribution of income is.
            According to the Census, it was .469 in 2009 and .4817 in 2017.
            Another way to look at it comes from a recent study by economists Thomas Piketty, Emmanuel Saez and Gabriel Zucman.
            The bottom half of earners have seen their pre-tax incomes fall while the highest earners have seen a fairly steady rise.

            14. Wage gap

            Debate abounds over how and why incomes vary by gender and whether the wage gap can fairly be said to exist. However, men and women, as well as people of different races, all have much different pay.
            Here are the median weekly earnings for employed, full-time wage and salary workers in 2015, with an overall average of $809, per the Bureau of Labor Statistics.

              15. Economic growth

              Following the dips in growth that marked the recession, the economy slowly and steadily rebounded. Many, including Trump, have said observed rates of growth are far too low.
              Here’s annual GDP growth, from the World Bank:

              16. Bills vetoed and signed

              During Obama’s tenure, he vetoed a total of 12 bills. Only one of those vetoes, the bill that would allow the families of those killed in the Sept. 11, 2001, terrorist attacks to sue Saudi Arabia for any role in the plot, was overridden by Congress and passed into law.
              Since 2009, 1,294 bills were signed into law that dealt with everything from the economy to foreign policy to health care, according to GovTrack.

              17. Homeless veterans

              The Obama administration put forth “an aggressive strategy to end veteran homelessness” in 2010 as part of its overall plan to combat homelessness in the US. The White House reports overall veteran homelessness decreased by 36% since 2010. There have been about 90,000 vouchers from 2008-16 to help house homeless vets, according to the Military Times.

              18. Violent crimes

              From 2014-15, the nation saw a 3.9% increase in the estimated number of violent crimes — the FBI released its annual report for 2015 that said there were an estimated 1,197,704 violent crimes committed.

              19. Hate crimes

              Hate crime incidents in the US neared 6,000 in both 2013 and 2015.
              • 2015: 5,850 incidents, 6,885 offenses
              • 2014: 5,479 incidents, 6,418 offenses
              • 2013: 5,928 incidents, involving 6,933
              • 2012: 5,796 incidents, 6,718 offenses

                20. Childhood obesity rates

                Youth obesity rates in the United States have steadily risen over the few decades past, nearly tripling in the past 30 years — a trend first lady Michelle Obama worked to reverse during her time in the White House. The Healthy, Hunger-Free Kids Act sought to give more than 50 million children an opportunity to eat healthier school meals.

                21. Police violence

                According to reporting done by The Washington Post, 991 people were shot dead by police in 2015. In 2016, the number decreased to 963, but there remained a number of high-profile cases that caught the country’s attention, including the shootings of Philando Castine and Alton Sterling.

                22. Job creation

                The Obama administration created 11.3 million jobs in eight years, and the economy added jobs for 75 straight months, a record that totals 6 years.
                More jobs were created under Obama than under George W. Bush, who only created 2.1 million jobs. However, Obama fell short of Bill Clinton and Ronald Reagan, who saw 22.9 million and 15.9 million jobs created, respectively, under their presidencies.

                23. Carbon emissions

                Obama made combating climate change and promoting efficient sources of energy a key aspect of his presidency. With a 9.4% decrease in carbon emissions from 2008-15, he made progress toward his goal of a cleaner environment, according to the White House.

                24. Countries visited and trips abroad

                According to the State Department, Obama took 52 trips abroad and visited 58 countries, plus the West Bank zone, during his presidency. The countries he visited most were France and Germany, both of which he traveled to six times. He visited five of the seven continents, skipping over Australia and Antarctica.

                25. State dinners

                President Obama held 13 state dinners at the White House in his eight years, hosting 16 different countries. He hosted two for China, one while Hu Jintao was still in office in 2011 and one for Xi Jinping in 2015.
                The countries he hosted include:

                26. Price of homes

                Obama saw the average price of home rise to $305,400 by November 2016, according to the US Census Bureau. Before the economic crash, the all-time high had been $262,600 in March 2007.

                27. Home ownership rate

                According to US Census data, home ownership rates have decreased by 4% under Obama. When he took office in January 2009, the home ownership rate stood at 67.3%. Now, upon leaving office, the figure stands at 63.5%.

                28. Life expectancy

                Life expectancy has remained fairly steady under Obama. However, there was a statistically significant drop of 0.1 years from 2015 to 2016, bringing life expectancy down to 78.8 years currently as he leaves office.

                29. People receiving food stamps

                The number of people receiving food stamps has increased significantly under Obama, according to the USDA.
                When he was elected in 2008, 28,223,000 people were receiving food stamps.
                In 2016, 44,219,000 people received food stamps — an increase of nearly 16 million people.

                30. Troops in Afghanistan

                Although Obama has vastly reduced the number of troops in Afghanistan during his time in office, he has failed to withdraw all American troops from the battlefields of Iraq and Afghanistan.
                When Obama took office in January 2009, there were 34,400 US troops in Afghanistan, according to the State Department.
                As of December 2016, there were still 9,800 troops left.

                31. Prisoners at Guantanamo Bay

                One day before the current president turns the White House over to the President-elect, the Pentagon announced four more inmates were transferred out of Guantanamo Bay.
                As of January 2017, 41 prisoners remain of the 242 detainees at the military prison when Obama came into office.
                Nine of those released have been “confirmed” to have returned to terrorist activities, according to a government report.
                Obama had pledged to close the controversial center within one year in an executive order he signed shortly after his inauguration in January 2009.

                32. Rounds of golf

                Obama hit the links 333 times since assuming the presidency, according to CBS News’ Mark Knoller, the unofficial White House statistician who pledged to track each and every round played by the commander in chief.
                While his critics have said this is too many rounds to play, his figure doesn’t come close to the amount played by Woodrow Wilson, who is said to have played 1,200 rounds while President.

                33. Executive orders

                Obama issued 249 executive orders, the third-lowest of any president since Theodore Roosevelt.

                34. Median household income

                The median household income has both risen and fallen under Obama.
                In 2015, the median was $56,516, which was a 5.2% increase from 2014. This was also the first increase in median income since 2007, before the economic crash.

                35. Consumer confidence

                Consumer confidence rose continuously under Obama to its highest level since August 2007 — before the Great Recession — according to the Consumer Confidence Index released by The Conference Board.
                In December 2016, the index was a high 113.7 — a stark difference to when fell as low as 25 during the recession, when Obama took office.

                36. Poverty

                The poverty rate in the United States in 2015 was 13.5%. This is down 1.2 percentage points from 14.8% in 2014. In 2015, there were 43.1 million people in poverty, 3.5 million fewer than in 2014.
                The 2015 poverty rate was 1 percentage point higher than in 2007, the year before the most recent recession.

                37. Birth rate

                The birth rate fell to 59.8 births per 1,000 women in 2016 under Obama.
                This marks the lowest birth rate since the government started keeping track in 1909, according to the Centers for Disease Control and Prevention.

                38. Price of milk

                The price of milk decreased under Obama from $3.58/gallon when he took office in January 2009 to $3.28/gallon as of November 2016.
                After the Great Recession, milk prices rose and have fluctuated since the economy turned around. Prices have been going down steadily since the beginning of 2015, according to the Bureau of Labor Statistics.

                39. Student loan debt

                2015 was a historic year for student loan debt. Students graduating with an undergraduate degree had on average $30,100 in loans, up 4% from 2014. Graduates who left college in 2009 when Obama assumed office averaged $24,000 in student loan debt, according to The Institute for College Access & Success.

                40. College tuition

                In 2016, the average college tuition increased by 2.4%. In 2015, the average private college cost $43,921 compared to $34,132 in 2008.

                41. US citizen deaths overseas from State-defined terrorism

                • The State Department recorded 80 US citizens killed by “terrorist action” from January 2009-June 2016 in Afghanistan.
                • State recorded two US citizens by “terrorist action” in Iraq during the same time period.
                • In total, State reported 115 citizens killed by “terrorist action” from the beginning of Obama’s presidency to the latest date for which data are available.

                42. US active military involvement

                In 2016, according to the Council on Foreign Relations, the US dropped 26,172 bombs during the course of 2016. But CFR says that number is “undoubtedly low, considering reliable data is only available for airstrikes in Pakistan, Yemen, Somalia, and Libya, and a single “strike,” according to the Pentagon’s definition, can involve multiple bombs or munitions.” This number increased from 2015, according to CFR, where the estimate came to 23,144, which CFR also defined as a “probably slightly low” estimate.

                43. US drone strikes

                Obama was known as a leader who extensively utilized and expanded the country’s drone strike capabilities in fighting terrorism. The Bureau of Investigative Journalism and The Atlantic reported the Obama administration launched 372 drone strikes in Pakistan, 112 in Yemen and 19 in Somalia as of March 2016.

                44. Clemency

                In his final week as president, Obama commuted the bulk of Chelsea Manning’s sentence and pardoned Gen. James Cartwright, who were both accused of leaking information to the public. The same day, Obama commuted hundreds of non-violent drug offenders.
                Then the day before Trump’s inauguration, the White House announced hundreds more commutations.
                With those moves, Obama’s total acts of clemency — the president’s decisions to pardon or commute criminal sentences — stood well above his predecessors. By the White House’s tally, his total number of commutations outpaced “the past 13 presidents combined.”

                Read more: http://www.cnn.com/2017/01/18/politics/obama-presidency-statistics/index.html