The Canadian housing market is popping their is already a bailout to save a mortgage company. Initial jobless claims inch up. Consumers are tapped out, credit defaults on the rise. Pending home sales decline and they have been flat-line for years. Durable goods decline. GDP is estimate has now dropped to .2%, this is terrible. Trump flips on NAFTA, he is now going to negotiate it first, if it does not work then he will make the move to remove it. Trump says the Government my shutdown. The Government has shutdown in the past and the people didn’t even notice. Bernanke says not to worry. Everyone should be worried now. Duterte is now getting rid if the Rothschild banking system. Trump trying another round of health care. Ivanka talks about refugees coming into America. US drops in press freedom. North Korea allegedly puts out another propaganda film, starting to look a lot like the IS videos. Putin says we need to calm the situation down. Trumps meeting with Senators ends up to be a discussion of peace, not war. US fires a flare at an Iranian patrol boat. Turkey sells weapons to the IS.
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Current News – 04.27.2017
- With Canada’s housing bubble popping amid the collapse of the country’s largest mortgage lender, it was no surprise that a bailout had been orchestrated, and now we know the source of the $1.5 billion ‘loan’ – 321,000 retired healthcare workers in Ontario. non-binding rescue loan with an unnamed counterparty will be secured by a portfolio of mortgage loans originated by Home Trust, the Toronto-based firm said in a statement
- Wednesday. Home Capital shares dropped by 61% in Toronto to the lowest since 2003, dragging down other home lenders.
- Healthcare of Ontario Pension Plan (HOOPP) is the lender behind Home Capital Group’s C$2 billion loan ($1.5 billion) to shore up liquidity,
- The last two weeks have seen initial jobless claims rise 23k to 257k. This is the biggest 2-week rise since Thanksgiving last year and is back above the Trump election levels and the start of 2017 levels.
- Two weeks ago, when JPMorgan launched Q1 earnings season, we noted that while the results were generally good, one red flag emerged: the company’s credit card charge offs rose to just shy of $1 billion, the highest in four years.
- According to the latest data from the S&P/Experian Bankcard Default Index, as of March 2017, the default rate on US credit cards had jumped to 3.31%, an increase of 13% from a year ago, and the highest default rate since June 2013.
The National bank card default rate of 3.31% in March sets a 45-month high. When comparing the bank card default rate among the four census divisions, the bank card default rate in the South is considerably higher than the other three census divisions. Upon further analysis to the South’s three census regions, East South Central – comprised of Kentucky, Tennessee, Alabama, and Mississippi – has the highest bank card default rate.
- CoreLogic warned earlier in the day, namely that that stalwart of any viable business cycle, mortgage performance, has finally started to deteriorate...
over the last year three of the four major types of loans began experiencing a deterioration in loan performance.
- … and it is becoming clear that the US consumer, responsible for 70% of US economic growth, has finally rolled over.
- “I received calls from the President of Mexico and the Prime Minister of Canada asking to renegotiate NAFTA rather than terminate. I agreed” Trump tweeted, and in a following tweet added “subject to the fact that if we do not reach a fair deal for all, we will then terminate NAFTA.” He concluded: “Relationships are good-deal very possible!”
- So what if Trump just pulls America out of NAFTA unilaterally? It sounds like he could do it. NAFTA’s Article 2205 presumably allows the president to pull the U.S. out of the trade deal without any input from Congress. All he has to do is provide six-months written notice.
- No one’s ever actually tried this before, though. America hasn’t walked away from a commercial treaty since 1866. And it’s an open legal question whether the executive branch can really just unilaterally withdraw from a treaty. So the White House could get sued right out of the gate by any number of businesses who rely on trade across the North American continent. Congress also passed a number of laws to put NAFTA’s terms into effect. Those would remain regardless of NAFTA’s fate, and would have to be scrapped by the normal legislative process.
- Democrats aren’t looking for a ‘deal’ on a funding bill… they actually want a government shutdown.
- So what does a “government shutdown” look like? Do the president and vice president resign now that the government ends?
- No, they stay on the job and receive full pay as before. Does Congress fly out of Washington D. C. the following day and cease to draw their pay, and the Supreme Court cease to deliberate on constitutional questions? Does the army come home and cease to protect us? No! No, NO! Do states, counties, and cities no longer function? No again, they have their own tax base and policemen, prisons, and teachers remain in place. Will we still get mail? Yes. The U.S. Postal Service functions as an independent business unit. Will we still get Social Security benefits, food stamps, unemployment compensation and veterans’ benefits? Yes!
- Why then the hysteria? Because these two words, “government shutdown,”
- we have had 18 “government shutdowns” since 1977 according to the Congressional Research Service, the Reagan Administration having 8 of them alone. Because in 1979 the government was shut down for 10 days while Congress argued over a proposed salary increase for the legislative branch. Because we had a five-day shutdown between November 14 and November 19, 1995, and a second one of 21 days, between December 16, and January 6, 1996, and none of the bad things mentioned above happened.
- No! Not even one. In fact, the public as a whole didn’t even notice it.
- “The Federal government of the United States put non-essential government workers on furlough and suspended non-essential services…(Wikipedia).”
- Essentially all went on as before except some paychecks were a few days late.
- So at worst a “government shutdown” is really only a partial shutdown of non-essential services and a delay of payment for some few federal workers.
- The fact is that by keeping interest rates at zero for seven years, the Fed has created a bubble in bonds. Back in 2008, the US’s Debt to GDP was just 65%.
- Thanks to seven years of ZIRP, the US Government was able to go on a massive spending spree, ballooning the Debt to GDP to above 105% where it sits today.
- How does this impact stocks?
- According to the Fed Model for valuing assets, stock prices trade based on interest rates (bond yields).
- The equation is the following:
- (Stock Earnings/ Stock Prices)= 10 Year Treasury Yields.
- So… if yields are pushed to record lows courtesy of Fed policy… and earnings are not growing rapidly to make up the difference, stock prices must soar.
- If this sounds like a load of nonsense to you, it is in fact the primary argument the financial elites are making for why stocks are such a bargain even today.
- “Measured against interest rates, stocks actually are on the cheap side compared to historic valuations,”
- the feds game: drive yields down so that stocks will rally. Indeed,this was the entire point of Fed activity post-2008: to reflate another bubble (this time in bonds) forcing capital into the financial markets.
- So in this sense, stocks are in fact in a derivative bubble… a bubble that is derived from another bubble (this one in bonds). And it will end as all bubbles do: in disaster.
- stock investors, you should be terrified. The most disconcerting words have been uttered by the one person capable of changing the whole dynamic. . In an interview with Charles Schwab, the former Fed Chairman says not to worry:
Dr. Bernanke noted that corporate earnings have risen at the same time; he believes corporate earnings will continue to grow and “catch up” to asset prices.
- Obviously, given his track record, that is a chilling statement
- President Duterte has vowed to “eradicate all traces of Rothschild financial criminality” from the Philippines, announcing that he will no longer respond to pressure or financial blackmail from the US government or Rothschild-controlled global banking institutions.
- The president, who claims to have killed cartel bosses with his own hands, is not one to be bullied, and he has now set his sights on cleaning up the financial corruption in his country, promising to “drive them out like the scavengers they are.“
- he says he will “eradicate all traces of Rothschild financial criminality” from his country, there is no question he will follow through, despite the inherent risks.
- The International Monetary Fund (IMF) and US-dominated World Bank have been major players in the global economic landscape ever since their creation in 1944.
- Moments ago the House Freedom Caucus announced their support for a revised version of an Obamacare replacement bill that includes the so-called “MacArthur Amendment.”
“Over the past couple of months, House conservatives have worked tirelessly to improve the American Health Care Act (AHCA) to make it better for the American people. Due to improvements to the AHCA and the addition of Rep. Tom MacArthur’s proposed amendment, the House Freedom Caucus has taken an official position in support of the current proposal.
The MacArthur amendment will grant states the ability to repeal cost driving aspects of Obamacare left in place under the original AHCA. While the revised version still does not fully repeal Obamacare, we are prepared to support it to keep our promise to the American people to lower healthcare costs. We look forward to working with our Senate colleagues to improve the bill.
- Reporters without Borders just published its annual World Press Freedom Index rankings, and the results for both the U.S. and UK are not impressive. Both countries declined two spots from last year, with the UK at 41, and the greatest and most free nation on earth, America, down to 43.
- Earlier today, Vladimir Putin warned that “the situation in Korea is deteriorating” and joined China in urging all sides to “avoid belligerent rhetoric.”
- The video was released just days after North Korea conducted large-scale artillery drills, showing off conventional weaponry that can easily reach South Korea’s capital, Seoul. It also comes one day after the entire Senate was gathered at the White House to receive a briefing from Trump’s top generals on the situation in North Korea.
- After weeks of threats of unilateral military action, joint statement by US Secretary of State Tillerson and US Defense Mattis appears to call that option off . t produced precisely nothing and which lasted all of 14 minutes – of trying to stop the North Korean nuclear weapons programme through “sanctions and diplomatic pressure”.
Today, along with Chairman of the Joint Chiefs of Staff Gen. Joe Dunford, we briefed Members of Congress on the review. The President’s approach aims to pressure North Korea into dismantling its nuclear, ballistic missile, and proliferation programs by tightening economic sanctions and pursuing diplomatic measures with our Allies and regional partners.
The United States seeks stability and the peaceful denuclearization of the Korean peninsula. We remain open to negotiations towards that goal.
- Russia has adapted to the situation and its economy started to grow in 2017, Jazairy said, adding that if the anti-Russia sanctions remained in force they would not have any dramatic effect.
- US warships have made a habit of wandering around in the Persian Gulf just off the coast of Iran, waiting for Iranian Naval ships to get sort of close, then complain in the international media how “unprofessional” that was. Today, the USS Mahan took it a step farther, firing a “warning flare” at the Iranian ship.
- Officials didn’t identify the Iranian ship involved in this case, but did say it was 1,000 meters away from the USS Mahan, which isn’t hugely close.