Authored by Lance Roberts via RealInvestmentAdvice.com,
Since the election, equity bulls have been pinning their hopes on “tax cuts” as the needed injection to support currently elevated stock prices. Stocks have advanced sharply since the election on these expectations, and while earnings have recovered, primarily due to the rise in oil prices, whatever economic growth was to come from tax reform has likely already been priced in.
To the relief of the banks and investors, the Basel III rule book was “watered down” sufficiently that the announcement that the deadlock had been broken led to a spike in European bank stocks on Friday morning. The sticking point holding back the clarification of Basel III for nearly a year had been how to adjust capital requirements for the risk of assets like mortgages. In particular, how far the banks’ models for calculating risk could diverge from more conservative assumptions – known as the “standardized approach” - used by regulators.
Sanctions, schmanctions...
After imposing various sanctions for whatever the neocon establishment can make up next, Washington must be shocked to see that their economic warmongery agains Russia has led to... lower and lower bond yields.
Russian five-year bond yields dropped to the lowest level since January 2014, even as Bloomberg reports that the U.S. Treasury prepares a report on the possible effect of sanctioning the nation’s sovereign debt.
Authored by Jesus Huerta de Soto via The Mises Institute,
It is interesting to note that Marx, in his analysis of the capitalist economic system, basically concentrates on the study of the imbalances and maladjustments which occur in the market.
Authored by James Howard Kunstler via Kunstler.com,
The hidden agenda in the so-called tax reform bill is to act as stop-gap quantitative easing to plug the “liquidity” hole that is opening up as the Federal Reserve (America’s central bank) makes a few gestures to winding down its balance sheet and “normalizing” interest rates. Thus, the aim of the tax bill is to prop up capital markets, and the apprehension of this lately is what keeps stocks making daily record highs. Okay, sorry, a lot to unpack there.