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Market Update Wednesday 07/15/20

“Up, Up and Away” returned on Wall Street, as the SkyNet BuyBots gained control in the overnight futures session, sending US stocks sharply higher at the open of trading on Wall Street. The rally continued with a vengeance all the way into the close, on renewed hopes of progress in the battle against Covid. The DJIA jumped another 227 points (0.8%) and the NASDAQ tacked on 62 points (0.6%).

Stay tuned as the battle 0of the SkyNet StockBots continues.

07/21/20 – Daniel Lacalle: The World Is Drowning in Debt

According to the International Monetary Fund (IMF), global fiscal support in response to the crisis will be more than $9 trillion, approximately 12 percent of world GDP. This premature, clearly rushed, probably excessive, and often misguided chain of so-called stimulus plans will distort public finances in a way which we have not seen since World War II. The enormous increase in public spending and the fall in output will lead to a global government debt figure close to 105 percent of GDP. Read More.

07/19/20 – David Morgan: Is There A Great Depression Coming?

We’ve only had one depression in modern times: the Great Depression, the worst economic downturn in the history of the U.S. and the industrialized world.

With unemployment at levels unseen since the Great Depression — the worst economic downturn in the history of the industrialized world — one has to be wondering if the country will eventually dip into a major depression.

Market Update Wednesday 07/08/20

It was pretty much another “Up, Up and Away” day on Wall Street, as the SkyNet BuyBots took control in the overnight futures leading to a sharply higher open of trading on Wall Street. From there, stocks went a net nowhere as they zigged and zagged into the close. The DJIA gained 177 points (0.7%) and the NASDAQ zoomed higher by 148 points (1.4%).

Stay tuned as the battle 0of the SkyNet StockBots continues.

07/15/20 – Egon von Greyerz: Humpty Dumpty System is Irreparable

What does it take to break the global financial system? Well, we obviously know what it takes since the system is already broken. Broken by debts, broken by deficits, broken by a fractured financial system, and broken by false markets as well as fake money.  So just like Humpty Dumpty, the system has already had a big fall. But the world still believes that this is all a fairytale with a happy ending. No one wants to recognise that Humpty is totally broken and irreparable. Read More.

07/11/20 – Shawn Langlois: The stock market is poised for a 40% drop, warns economist who says the current climate feels a lot like 1929

‘I think we’ve got a second leg down and that’s very much reminiscent of what happened in the 1930s where people appreciate the depth of this recession and the disruption and how long it’s going to take to recover.’ That’s A. Gary Shilling, longtime economist and president of A. Gary Shilling & Co., again delivering a gloomy take on what’s next in a recent CNBC interview. Read More.

07/10/20 – MN Gordon: Game Over Spending

Second quarter 2020 came and went like a California wildfire. The economic devastation caused by the government lockdowns was swift, the destruction immense, and the damage lasting. But, nonetheless, in Q2, the major U.S. stock market indices rallied at a record pace. Read More.

07/09/20 – Charles hugh SMith: You Are Now Leaving FantasyLand: The Losses Will Be Taken By Somebody

Round about late March, we entered a Financial FantasyLand in which all the sins and excesses of rampant financialization were going to be painlessly washed away. Mever mind the entire U.S. economy is an inverted pyramid of balance-sheet “value” and debt resting on a shrinking foundation of collateral; everyone would be made whole in the Federal Reserve’s Financial FantasyLand. Read More.

07/07/20 – James Rickards: Depression and the Great American Exodus

Is the worst of the economic collapse over? Not really. The economy is off the bottom, but that’s only to be expected after the historic collapse of March–May and the stock market crash in March and April. The question now is not whether we’re growing again. We are. The questions are how fast is that growth, and how long will it be before we return to 2019 levels of output? Read More.

07/06/20 – Gary Shilling Sees 1930s-Style Decline In Stock Market

“I think we’ve got a second leg down and that’s very much reminiscent of what happened in the 1930s where people appreciate the depth of this recession and the disruption and how long it’s going to take to recover,” Gary Shilling, the president of A. Gary Shilling & Co., told CNBC’s Elizabeth Schulze in an interview on Monday, referring to the possibility the stock market will tumble once investors realize the shape of the recovery is an “L” rather than the overhyped “V.” Read More.

07/05/20 – Bruce WIlds: Wall Street Soars While The Real Economy Slowly Dies

Main Street is the real economy that exists far from Wall Street. It can be seen in the large areas of America where most of us live. After twelve long years of near or zero interest rates, massive government deficits, and watching tons of money and stimulus being poured into the economy we remain mired in slow growth. On top of this, we now are seeing covid-19 monkey hammering many sectors of the economy into submission. Read More:

07/06/20 – Tyler Durden: JPMorgan Turns Bearish, Sees “Unattractive Risk-Reward” For Stocks In H

It may come as a surprise to some, but just two weeks after JPMorgan said it was turning bullish on the US, officially upgrading US equities to Overweight after holding a missing the biggest equity rally in decades with a Neutral rating on US stocks, the bank appears to have had a change in heart, and overnight the bank’s chief equity strategist Mislav Matejka writes that looking ahead, much of his newly found optimism has vaporized and as a result, “risk-reward is unattractive for equities in 2H of 2020” and stocks are likely to lag bonds and cash again, as they did in 1H ‘20. Read More.

07/06/20 – Daniel Lacalle: Europe’s Bailouts Risk a Full-Blown Financial Crisis

The measures implemented by governments in the eurozone have one common denominator: a massive increase in debt from governments and the private sector. Loans lead the stimulus packages from Germany to Spain. The objective is to give firms and families some leverage to pass the bad months of COVID lockdowns and allow the economy to recover strongly in the third and fourth quarters. This bet on a speedy recovery may put the troubled European banking sector in a difficult situation. Read More.

07/06/20 – Yazid Suleiman: The Market Economy Has Been Replaced by a “Fiat Economy”

The COVID-19 pandemic has torn the veil off what we can now can call a “fiat market. It has stripped away all pretense of a true market. Governments and central banks now create both supply and demand. Bailouts and subsidies are handed down so that zombie corporations can produce on the one hand, while welfare, universal basic income, and other handouts are distributed so that citizens can buy the products. Strictly speaking, this is a type of socialism. Read More.