Following the controversial bank bailouts and Troubled Asset Relief Program (TARP) in 2008, reports show in late 2019 and 2020, the U.S. Federal Reserve participated in providing trillions of dollars in secret repo loans to megabanks. At the end of March, investigative journalists, Pam and Russ Martens from Wall Street on Parade, uncovered $3.84 trillion in stealth repo loans from the Fed to the French financial institution, BNP Paribas in Q1 2020. Additional data indicates that the U.S. central bank leveraged secret repo loans to provide a whopping $48 trillion to megabanks in late 2019 and into 2020.

secondary coin to US $.  50billion in digital coins was created   I googled it and it

shows that it is true. I don't know how to bring things over so if one of our wizards could

look into it I fell out of my chair. 😵  Thanks in advance

What's next?......is the bounce about to end?....that would be my guess......     CL

Our call of the day is from Yves Lamoureux, the president of macroeconomic research firm Lamoureux & Co., who says the second COVID-19 wave is about to usher in another stock pullback

“We’re playing very defensive by buying these SPACs and there’s a very big boom,” said Lamoureux, who recommends GMHI GMHI, -2.56%, or Gores Metropolus — his biggest stockholding.

Last month, automotive technology company Luminar, which works with Volvo VOLV.B, -0.87% and other top auto makers, agreed to go public through a merger with GMHI. That taps into a theme he likes — self-driving cars and trucks.

And that segues into a bigger, long-term call that he said is on few radars — deflation. He sees three drivers for this — robotic and other automated technologies that push workers out of jobs, a big drop in oil prices amid rising demand for greener energies, and a 20-year decline in real-estate prices.

“Eventually we’re out of the pandemic, but we’re facing these three big threats that are as big as the pandemic,” he said. “What do you expect once you get out of this pandemic? This is what is awaiting, and that has major consequences for investments.”

https://www.marketwatch.com/story/the-second-wave-of-a-rolling-bear-market-is-about-to-begin-says-top-forecaster-11600945948?siteid=yhoof2&yptr=yahoo

The Dow shed 1,464.94 points during the session, or 5.9%, sending it more than 20% below its recent high from February and into a bear market.

Midday Wednesday, the World Health Organization officially designated the coronavirus outbreak a pandemic, as the virus spread across more than 100 countries and infected well over 100,000 individuals. The Dow sank more than 1,200 points following the announcement.

Stocks’ afternoon leg lower extended declines from earlier in the regular and overnight sessions. During the pre-market session, stock futures slumped after the White House failed to offer further details on a stimulus package President Donald Trump earlier this week had characterized as “very major.” The measures reportedly in consideration included a payroll tax cut and expanded worker protections, to help counteract any economic fall-out from the ongoing coronavirus outbreak.

While further fiscal stimulus in the U.S. remains a point of uncertainty, overseas, central bankers have unleashed further monetary stimulus aimed at counteracting the economic hit from COVID-19.

The Bank of England on Wednesday announced a surprise half-point interest rate cut at the conclusion of a special meeting, following a similar move from the U.S. Federal Reserve last week.

“Following the spread of COVID-19, risky asset and commodity prices have fallen sharply, and government bond yields reached all-time lows, consistent with a marked deterioration in risk appetite and in the outlooks for global and UK growth,” the BOE said in a statement Wednesday, “Indicators of financial market uncertainty have reached extreme levels.”

The BOE’s move brought the main bank rate down to 0.25%, and was decided unanimously by the bank’s officials.

“Temporary, but significant, disruptions to supply chains and weaker activity could challenge cash flows and increase demand for short-term credit from households and for working capital from companies,” the BOE said. “This economic shock will affect both demand and supply in the economy.”

https://finance.yahoo.com/news/stock-market-news-live-updates-march-11-2020-115430808.html

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Though the first market jitters over the economic impact of coronavirus had already led to consecutive triple-digit losses, Trump posted an optimistic appraisal of the investment landscape on Feb. 24.

Hours after Trump’s tweet was published, the Dow Jones Industrial Average closed at 28,992, down 227 points.

A day later Larry Kudlow, Trump’s director of the National Economic Council, made a second appeal on behalf of the beleaguered stock market.

“The virus story is not going to last forever,” Kudlow said in an interview. “I would suggest very seriously taking a look at the market, the stock market, that is a lot cheaper than it was a week or two ago.”

Despite Kudlow’s optimism, the Dow fell another 1,031 points that day, to close at 27,912.

In fact, that week turned out to be the worst for the stock market since the 2007 financial crisis, with the Dow losing 3,500 points and wiping out $3 trillion in value.

On Feb. 27, three days after offering his stock market tip, Trump announced he was appointing Vice President Mike Pence to head up his coronavirus task force, which also included Kudlow. During a White House press conference, Trump assured assured the country that the number of Americans infected with the virus “was going very substantially down, not up,” and that “within a couple of days” the tally would be “down close to zero.”

Perhaps buoyed by that infectious confidence, Trump’s son, Eric, jumped on the “buy the dip” bandwagon.

But just as the number of cases did not go down as Trump had foreseen (the number has risen from 60 confirmed cases at the time of Trump’s press conference to over 600 as of Monday), the stock market proved an equally bad bet.

On Monday, it fell 2,014 points, the largest single-day point loss in history, and closed at 23,851. For those keeping score at home, that’s more than 5,000 points lower than when Trump proclaimed the markets were starting to look good.

Of course, Trump isn’t the first president to encourage Americans to invest in the stock market. On March 3, 2009, then-President Barack Obama saw an opportunity to buy following a nearly 300-point dip in the Dow, which at that time had fallen to 6,726 points in the wake of the Great Recession.

“What you’re now seeing is profit-and-earnings rations are starting to get to the point where buying stocks is a potentially good deal if you’ve got a long-term perspective on it.”

From the time he said that through the end of his presidency, the S&P 500 rose by nearly 225 percent.

https://www.yahoo.com/news/in-coronavirus-crisis-trumps-stockmarket-advice-keeps-looking-worse-213627171.html

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In a series of tweets, Cramer warned that signs point to an imminent recession:

Cramer also said that, by the time the market closes, we could be waving goodbye to the bull market investors have enjoyed for more than a decade.

“I think that that’s certainly a realistic thing,” he said. “It’s been a great run.”

A great run, indeed. The bull market kicked off 11 years ago today — happy birthday? — and it emerged as the longest on record by August 2018. But this could certainly be the end of it.

A bear market is widely defined as a drop of 20% from recent highs. The S&P SPX, -6.763% would have to close at 2,708.92 to enter bear territory, according to Dow Jones Market Data. The Dow DJIA, -6.852%, which briefly broke below the bear number, would have to end at 23,641.14. At last check, they were both holding above those levels, but things can change fast in this market.

Jim Cramer

 

✔@jimcramer

 

Analysts seeking safety fled into government bonds, driving the yield on the benchmark 10-year U.S. Treasury plummeting 25.1 basis points to 0.43% — another all-time low. Yields and debt prices move in opposite directions.

What are major indexes doing?

Before being halted, the Dow Jones Industrial Average DJIA, -7.89% was down 1,884.88 points, or 7.2%, at 23,979.90, while the S&P 500 SPX, -7.39% was off more than 208 points, or 7%, at 2,764.21. The Nasdaq Composite Index COMP, -7.33% were off 588 points, or 6.86%, at 7.987.44. Before regular trade, futures fell their 5% limit in early Asian trade and have traded near there for most of the session.

The Dow Jones industrials dived 3.2%, the Nasdaq crashed 3.7%, and the S&P 500 shed 3.4%. Small caps tracked by the Russell 2000 tumbled 2.2%. Volume was higher on both major exchanges vs. the same time Monday.

Soon after the open, the Federal Reserve unexpectedly cut rates by a half point to help counter the economic impact of the coronavirus outbreak. It marked the first surprise cut since the 2008 financial crisis. Fed Chairman Jerome Powell said risks to the U.S. outlook "have changed materially."

President Donald Trump tweeted a demand for further easing: "The Federal Reserve is cutting but must further ease and, most importantly, come into line with other countries/competitors. We are not playing on a level field. Not fair to USA. It is finally time for the Federal Reserve to LEAD. More easing and cutting!"

https://www.investors.com/market-trend/stock-market-today/dow-sells-off-surprise-fed-coronavirus-rate-cut-trump-demands-more/?src=A00220&yptr=yahoo

It did finish higher then the day's low

Dow 30
25,917.41

“For the last few weeks, while we've had this volatility, you've had stocks zig while bonds zag. So every time stocks went up, bonds tailed off and vice-versa,” Academy Securities’ Peter Tchir said on Yahoo Finance’s The Final Round. “All of a sudden, that behavior changed a little bit into the close yesterday. And making it even more dangerous to me, you saw oil fall off into the close. Commodities were selling off. Even Bitcoin was selling off into the close.”

Typically when uncertainty spikes in financial markets, traders and investors will rotate out of risky assets like stocks and into ‘safe haven’ assets like bonds or perhaps gold. When this happens, risky asset prices go down and safer asset prices go up.

But when market participants are panicking, they begin to cash out of everything. And that can lead to even more panic.

In a note to his clients titled “Did Someone Hit the ‘Sell Everything’ Button?,” Tchir wrote that “While increases in volatility are concerning for market participants, changes in correlations, while more esoteric are far more dangerous. Changes in correlation can affect portfolio level volatility far more dramatically than a simple increase in volatility across asset classes (sounds wonky, but this is important).“

The U.S. services sector is at risk

While panic selling is often characterized by the indiscriminate dumping of assets with little regard to fundamentals (like the supply and demand for goods and services), Tchir notes that there may be something real to justify what’s happening in world markets as the spread of the coronavirus (COVID-19) affects consumer behavior.

“I'm really focused on the tourism angle,” Tchir said to Yahoo Finance. “China has become a huge consumer of tourism. The Chinese spend more money outside of China than any other country spends on foreign travel. I think that's part of the reason we had very weak service data last week. And that service data, to me, has been really important.”

Tchir was pointing to last Friday’s IHS Markit Flash U.S. Composite PMI report, which suggested that U.S. services activity was at a 76-month low.

This is critical because services eclipses manufacturing in the U.S. economy.

“For the past few years, every time we get a hiccup we can argue, ‘Well, we're not a manufacturing economy, we're now a service economy,’” Tchir said. “If services go, that is very problematic. I think that's going to get hit very quickly by this slowdown in foreign travel from other countries.”

Portfolio hedges are breaking down

The Dow Jones Industrial Average (^DJI) has fallen a whopping 2,400 points since last Wednesday.

For folks with diversified portfolios, the expectation is that some of the non-risky (e.g. non-equity) asset classes should provide some hedges.

That’s not happening. And that could make things worse.

“I think volatility has been elevated long enough that there is some selling pressure which is also changing correlations, causing more selling pressure,” Tchir wrote. “I expect portfolio volatility to increase as funds caught in the same trades create a vicious cycle of needing to sell everything, exactly when buyers of everything are being tentative.

https://www.yahoo.com/finance/news/market-asset-correlation-changes-stocks-bonds-gold-bitcoin-peter-tchir-120837786.html

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The coronavirus may wipe out corporate growth in 2020, perhaps completely.

Goldman Sachs said Thursday in a note U.S. companies will generate no earnings growth in 2020. Underlying the call is Goldman’s view that the coronavirus is expected to spread around the globe and severely harm economic activity. For 2020, Goldman slashed its S&P 500 earnings estimate by $9 and expects no earnings growth. Looking out into 2021, Goldman now sees $8 less in S&P 500 earnings and a modest 6% growth rate.

“Our reduced profit forecasts reflect the severe decline in Chinese economic activity in 1Q, lower end-demand for US exporters, disruption to the supply chain for many US firms, a slowdown in US economic activity, and elevated business uncertainty,” wrote Goldman strategist David Kostin.

Kostin doesn’t top there in sounding the alarm bell on coronavirus, however.

“A more severe pandemic could lead to a more prolonged disruption and a US recession,” Kostin said. Under a recessionary scenario, Kostin sees S&P 500 earnings dropping 13% this year. They would potentially rebound to 10% growth in 2021.

Goldman recommends shifting one’s portfolio to more defensive equities. The investment bank raised its outlook on real estate to overweight from Neutral and utilities to Neutral from Underweight. Industrial equities are now rated Neutral, down from Overweight, while financials are at Underweight versus Neutral previously.

https://www.yahoo.com/finance/news/coronavirus-will-wipe-out-corporate-profit-growth-in-2020-and-may-trigger-recession-goldman-sachs-122739601.html

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The U.S. economy sputtered to finish off 2019.

On Thursday, we learned U.S. GDP growth came in slightly faster than forecast in the fourth quarter of the year at 2.1%. Wall Street had expected growth would settle at 2% in the year’s final three months. For the full year, the U.S. economy grew at 2.3%, a slowdown from 2.9% pace of growth we saw in 2018 following Trump’s tax cuts.

But this data comes with some big caveats that cover up clear weakness that emerged across the economy to end 2019.

“While the average 2.3% GDP advance in 2019 is only marginally weaker than the 2.4% print in 2017, this is yet another optical illusion as the most recent three quarters mark the economy’s worst performance since the 2016 slump,” economists at Oxford Economics said in a note on Thursday.

Oxford notes that more than 70% of the fourth quarter’s jump in GDP came from unexpectedly strong trade data. In the fourth quarter, imports fell at an annualized rate of 8.7% while exports rose at a rate of 1.4%. The net exports data that feeds into GDP is the total of imports minus exports, and so while trade slowed in the fourth quarter this data served to boost the growth calculation.

“Net trade represented the largest optical illusion in the GDP report, providing an artificial boost to GDP growth of 1.5%,” the firm notes.

Additionally, government spending provided a boost to economic output, with Michael Feroli at JPMorgan writing Thursday that, “Real federal spending increased at a 3.6% rate last quarter and was up 4.3% for the year, the most since the Recovery Act boosted spending in 2009.” Feroli expects federal spending will slow this year.

The corporate sector and consumers also showed signs of weakness amid uncertainty around trade to finish the year.

Business investment fell at an annualized rate of 1.5% in the fourth quarter, the third straight quarter of declines with nonresidential investment in structures falling 10.1%. As Hedgeye’s Darius Dale said Thursday, “The US private sector did, in fact, grind to a halt in Q4.”

But some economists see growth stabilizing and perhaps even accelerating in the year ahead.

Paul Ashworth at Capital Economics notes that a phase one U.S.-China trade deal along with lower interest rates, “should begin to boost business investment over the coming quarters, just as they are already benefitting residential investment.” To wit, Ashworth notes that residential investment surged 5.8% during the fourth quarter.

Consumer spending in the fourth quarter also slowed to 1.8%, which Oxford Economics attributed to households showing “more caution in the face of elevated policy uncertainty and moderating income growth.”

But Ashworth argued Thursday that “with consumer confidence buoyant, employment growth trending slightly higher and the saving rate still elevated, we are not too concerned about the consumer.”

Ian Shepherdson at Pantheon Macroeconomics is also unperturbed by consumer behavior to finish the year. “We aren’t worried by the slowdown in consumption from the 3.9% average in Q2/Q3,” Shepherdson writes. “That was not sustainable and a correction was inevitable. We look for a return to trend, at about [2.75%], in Q1.”

As Ashworth writes, “With the survey evidence beginning to improve slightly, and the Phase One trade deal easing one of the headwinds holding back investment, we expect GDP growth to gradually accelerate this year.”

https://finance.yahoo.com/news/fourth-quarter-gdp-growth-optical-illusion-morning-brief-110222004.html

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That means the most unloved bull market in memory chugs along. Since March 1, 2009, the Standard & Poor's 500 stock index is up 435% while investors continue to reduce their exposure to stocks.

Despite 2019 turning in the strongest year for stock investors in the last six, investors have been selling stock mutual funds at a record pace. So far, equity mutual funds and exchange-traded funds have lost over $135 billion to withdrawals – the largest amount since Refinitiv Lipper began tracking the flows in 1992.

While the market has continued to power forward and investors have been exiting equity investments, cash on the sidelines has risen. So what exactly does that mean for investors? 

While it is difficult to say for certain, we can make some assumptions based on what we do know. 

First and foremost, when markets get frothy, one of the catalysts that drives stocks higher is cash moving from the sidelines into the stock market. Think FOMO on steroids. Yet, we have seen the opposite occur over the last few years. Indeed, as stock prices have risen, so has cash.

And it remains a fact that with bond yields at extraordinarily low levels, there are few investment options other than stocks to achieve yield and capital appreciation objectives for many investors. 

According to Strategas Research Partners’ Jason Trennert, one-half of the S&P 500’s total return since 1926 has come from dividends. And in the decade beginning in 2000, basically, the only return investors received came in the form of dividends, according to Trennert. Dividends matter.  

Real yields on bonds – the after-inflation return – is just modestly above zero. And, while we are on the subject of inflation, despite expectations that full employment would drive prices higher, inflation remains elusively tame. The Fed is unlikely to raise rates in such a benign environment.    

Additionally, stock buybacks are providing a floor to stock prices by reducing the supply of individual shares.  Trennert’s work has also shown that in 2018 “buybacks accounted for $573 billion of net new demand for equities.” Compare this with equity ETFs, which generated $210 billion in demand and stock mutual funds, which were responsible for $124 billion of net sales.    

Dividend growth is around 7.2% in recent years and payout ratios are near historic lows. This gives companies room to grow the dividends further. Importantly, dividends provide investors with information: Large companies pay and raise the dividend at a rate based on what they believe long-term sustainable earnings growth to be. The dividend is a commitment; buybacks are opportunistic. But when combined, the two produce what is called the shareholder yield. That number is currently 5.1% for the S&P 500 which is over 3 percentage points higher than the yield on the 10-year Treasury. 

If you have cash on the sidelines, companies who pay a dividend and grow the dividend are a good place to start. These are easy to find if you run a search on just about any financial website. You can also determine if the company is buying back stock by reading the most recent earnings press release on their website. 

The combination of above-market dividend yield (that is growing) and a promise to buy back shares can create an attractive investment opportunity. Being informed and diligent is a better investing strategy than no strategy at all. And it keeps us from “acting ridiculously” at just the wrong time. 

https://finance.yahoo.com/news/hey-good-news-america-investors-100004247.html

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Breaking it down by the numbers, FT Alphaville also pointed to a study published by the University of Chicago’s Booth School of Business that shows, from 1927 up to 2015, the average excess market return with a Democrat in office is 10.7% vs. a -0.2% with a Republican.

https://finance.yahoo.com/m/790e2abd-dc0b-31ce-9267-75acb0b05593/a-vote-for-a-democrat-is-a.html

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A Vanity Fair deep-dive into stock market activity has uncovered several instances where advantageous trades were made suspiciously close to market-moving events.

One trade, made just before Iranian drones attacked Saudi Arabian oil production facilities, netted $180m. Another trade, made shortly before Mr Trump announced a delay in tariffs on Chinese goods, made $190m. The biggest trade of all came on June 28, while Mr Trump was at the G20 meeting. There, he met with President Xi and announced trade negotiations were "back on track."

Those trades ended up being worth $1.8bn thanks to an 84 point boost in the S&P 500 index following Trump's announcement.

Though the story quotes an unnamed commodities trader as saying “there’s something fishy going on”, other analysts disagree. One who spoke to Bloomberg said that without the trading records, insider trading would be impossible to prove, and that in the futures market, trades that make large amounts of money fast are actually not uncommon. It's even impossible to know how if all that money went to one entity or perhaps several who happened to make a lucky bet.

“Millions of futures contracts trade a day, billions of dollars trade a day, so to make a connection, I feel like it’s very hard to do,” Michael O’Rourke of JonesTrading told Bloomberg.

According to Slate, just knowing when trades happen isn’t enough to prove how much money they made - you’d also need to know how long the buyer held onto those shares.

There's no suggestion in the article that Mr Trump or anyone in his circle is involved in insider trading.

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A bearish "death cross" pattern is appearing in the Russell 2000's RUT, +0.45% chart Thursday, for the first time in about 11 months. Many technical analysts believe the pattern, in which the 50-day moving average crosses below the 200-day moving average, marks the spot a shorter-term decline transitions to a longer-term downtrend. The small-capitalization stock tracker's was up 0.4% in afternoon trading, with the 50-day moving average slipping to 1,521.94 and the 200-day moving average rising to 1,521.95, according to FactSet. The Russell 2000's last death cross appeared on Nov. 14. The index tumbled another 16% before bottoming at a 2-year low on Dec. 24. The current death cross comes about 5-months after a "golden cross" pattern appeared on May 7, which was a day after the index peaked at a 7-month high. Meanwhile, the S&P 500 SPX, +0.80% was up 0.6% on the day, and its 50-day moving average was still 3.7% above its 200-day moving average

Funny how they start this impeachment bs, as the signs of the economy going down and QE relaunch happen. Look over here not over there.

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