North America

It's official: moments ago TransCanada said the U.S. Department of State issued a presidential permit for the construction of the Keystone XL Pipeline, ending a multi-year controversial, at times acrimonious debate over the future of the pipeline. The pipeline linking Canadian oil sands to U.S. refiners had been blocked by Barack Obama, who said the pipeline would do nothing to reduce fuel prices for U.S. motorists and would contribute emissions linked to global warming.

Last month we wrote about "Mexico's Fiery, Trump-Like Populist Who Looks Increasingly Likely To Win The Presidency In 2018."  As we noted before, Pena Nieto’s PRI party, which has held power for most of Mexico’s modern history, has seen its popularity eroded in recent months due to a series of corruption scandals, surging gasoline prices and a perception among Mexican voters that Pena Nieto himself has been too soft in combatting an aggressive Trump Presidency.

One week ago we reported that "Mega-Bears Smell Blood As Mall REITs Tumble" in which we wrote that "just like 10 years ago, when the "big short" was putting on the RMBX trade, and to a smaller extent, its cousin the CMBX, so now too some are starting to short CMBS through the CMBX. They are betting against securities backed by malls in weaker locations where stores could close in quick succession, triggering debt defaults."

Amazon's willingness to sell almost any product imaginable at a loss, combined with a massive bubble in retail real estate square footage courtesy of decades of low interest rates seems to finally be catching up with the traditional bricks-and-mortar retailers of America. 

As evidence, Scott Krisiloff of Avondale Asset Management compiled the following sample of relatively downtrodden commentary from America's largest retail CEOs, all of who seem to be throwing in the towel on hopes of any near term upside for their industry:

While many have blamed today's spike in yields for the broader underperformance of the REIT sector, which sent the Bloomberg North American REIT index down 1.4%, its biggest one-day drop since December in a widespread selloff across all property sectors with 194 of the 214 stocks in the index lower today, it's more than just the jump in rates that is slamming the rate-sensitive sector.