Monday Market Mayhem – Mass Shootings and Trade Wars Make Investors Nervous

Related imageCan America seem more our of control?

Over the weekend, there were two major shootings (Dayton, Ohio and El Paso Texas) where 30 people were killed and another 53 injured but that was Saturday.  On Friday in Virginia and Maryland, 5 people were killed and 4 injured, which hardly rated a mention in the US press as it's a daily thing now but Sunday, while Dayton was happening, another 20 people were injured and 2 people killed in 2 incidents in Chicago, 1 in NYC and one in Memphis.  

Before you think that Dayton and El Paso just distracted us from 22 people hurt by guns (and this only counts multiple death/injury incidents), keep in mind that, in the previous week (from 7/23 to 7/30), there were 16 mass shootings where 28 people were killed and 62 were injured including a dozen people in Brooklyn you probably didn't hear a thing about.  Are we really that numb to this sort of thing that 50 people killed in July and 202 wounded didn't even get our attention?  Maybe it's because it was less than the 217 wounded in June (only 34 killed though)?

Image result for school shooting map 2019And again, this is ONLY shootings with AT LEAST 3 people being shot in a single incident.  So far, in 2019, we average 1.2 of those every day, 22 of them in schools.  It's only Aug 5th but we've had over 450 total shootings in the US this year so it's a very good thing "only" about 1/3 of them are mass shootings or we'd still be picking up the bodies.  Maybe that's what it will take – maybe we have to start tripping over all the bodies while we shop before we decide this madness has to end?

How can you look at these maps and not think something is very wrong with the way we're doing things in this country?  How can you let your elected representatives get away with telling you there's nothing wrong with the way we do things?  Do they tell you it's violent everywhere?  Because it's not! 

Image result for gun violence by countryThe US
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TGIF – Stop the Week, We Want to Get Off!

ImageWhat a mess! 

All of our summer gains are completely wiped out – thanks to the Tweeter in Chief, who sent the markets flying lower by proclaiming additional tariffs on China after this week's meeting yeilded no progress.  Of course the meeting was just an excuse to place more tariffs as the US could hardly be serious taking a 14-hour flight to Beijing to have a 4-hour meeting and then not schedule the next one until September.  

This is just political theater aimed at dragging out the negotiations while Trump places more taxes on the American people to add to his re-election slush fund that lets him hand out "relief money" to his biggest donors.   Fortunately for Trump, as I pointed out Wednesday morning, his base is too dumb to know they are being robbed by the President, who confidently repeats the lie that China is paying these tariffs so often that it really is hard to keep a grip on reality.

Even by the President's own warped logic that China somehow magically pays for the tariff tax that is solely levied against US Citizens and Corporations, what about the retaliatory tariffs China has placed on US Goods?  Wouldn't that mean that we are paying for those?  Of course China makes no such claim because their people aren't idiots and, so far, China has "only" placed $113Bn worth of Tariffs on US goods but China last night said they will retaliate against Trump's new round of Tariffs.

As I've been saying since this began – this has nothing to do with China. Trump wants to tax the American people $125Bn to pay for the tax breaks he gave to his family and his Top 0.1% buddies and that's also why Trump was so gung-ho to ram a budget bill through that would raise the debt ceiling (and our debt) by $2.5Tn – BEFORE his tax breaks became an issue and were possibly repealed.  Now he's got his tax cut extended for 2 more year and the first thing he does is go out and place more tariffs because that's "found money" in his budget that he can then turn around and hand out
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Thursday – Fed Fails to Support S&P 3,000 – Now What?

Image result for wages profits chartWhaaaaaaah! 

The markets threw a little temper tantrum yesterday when they "only" got a 0.25% rate cut from the Fed and then, adding insult to injury, Chairman Powell did not promise more cuts for sure but said he might if wages stay low – so there's more incentive for our Corporate Masters to not pay us a fair share of the profits.   

As you can see from the chart on the right (which has gotten worse, not better, since), Corporate Profits do keep rising but wages have been on a completely different track – especially since the Financial Crisis as Corporations were bailed out and people were not.  The $15 minimum wage is hopefully going to balance that just a bit – but we're miles away from anything resembling a fair distribution.

Corporate Profits used to be 5% of GDP ($1Tn today) and Wages were 52% of GDP ($10.4Tn) in the 60s but now Corporate Profits are $2.4Tn and Wages are $8.8Tn but the difference is Corporate Profits are shared by the Top 1% while Wages are split by 100% of the workers, including the Top 1% who double dip by taking wages that are now up AVERAGING 300 TIMES what their workers make.  

Image result for ceo wages 2018

If you really want to Make America Great Again – maybe we should go back to the days when CEOs made 1/10th of what they do today and workers made 16% more than they do now.  That's the problem, in order for one rich guy to go from 20x the average wage to 312x the average wage – you have to take 16% away from the other 99 guys.  Why do they put up with that?

They might not for long as Democratic Candidate and Mayor of New York City said in yesterday's debate that "We will tax the Hell out of the Wealthy" saying:

“For 40 years the working people have taken it on the chin in this country. For 40 years the rich got richer and they paid less and less in taxes. It cannot go on this

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