Bull Market officially over!! Year heading negative.

[Omega10]

Here, to me, is why China will defeat the US in our global economic war.

https://finance.yahoo.com/news/g-20-...123407405.html

Title: G-20 Looks to Deepen Debt Relief Drive With China’s Coordination

Premise of the article: poor and developing countries that have been battered by the virus need debt relief.

Policy makers from the world’s largest economies are set to meet Friday to iron out the details of a plan for debt relief to the poorest countries battered by the Covid-19 pandemic.

However, the article makes it quite clear that western countries are in no position to help.

Beijing says that global multilateral banks and commercial creditors have failed to provide relief to the poor despite holding much of their debt. However, it’s unclear if private investors would be able to grant leniency due to their fiduciary duties to clients, given that the fine print in many debt agreements prohibits changes in the terms without the approval of the majority of bondholders.

Oops western investors can't help. There is a big problem that needs to be solved, but there is just nothing that western countries can do due to our fiduciary duties. But if China would help, that would be AWESOME!!!

Note: This is similar to "America CAN NOT reduce its oil output since so many different companies are involved." Saudi Arabia and Russia thus took matters into their own hands and set the price of oil suitable to them. Not so suitable for the US fossil fuel industry.

“Anything that moves us in the direction of China accepting Paris-Club-style principles, I think that would be a good thing,” said Mark Sobel, a former U.S. Treasury official now at the Official Monetary and Financial Institutions Forum. “I expect the common framework to be incremental and not revolutionary.”

Well yeah. Anything that gets China to bow down to western interests is a good thing from a western standpoint.

Russia and Saudi Arabia showed the way for China to go down. This goes in the duhh category.

China will forgive debt with deals that give them benefits, rather than forgiving debts with deals that give western countries benefits. I guess that western countries are trying to pressure China into stabbing themselves in the back?

Between controlling oil prices, the virus, and now helping developing countries deal with crushing debt, America's position seems to be the same: there is nothing we can do. Not a very good look.

[Zan15]

Based on the 7 day moving average of Covid cases and deaths i am so tempted to bail at this point and buy in on the next mini crash.

its really not looking good right now.

take the profit and run and wait on sidelines?

[Rasulis]

I’ll reiterate again, this is a very lopsided recession. CA lost 3M jobs back in March and was still down 1.6M jobs in September (Fig. 1). Less Educated Workers Account for Nearly All Job Losses. Almost all job losses have been among workers with less than a Bachelor’s degree. Specifically, while workers with no high school degree, a high school degree, or some college (including associate’s degree holders) make up a total of 60 percent of the workforce, these workers account for 97 percent of net job losses since February (Fig. 2).

The disparity is reflected in CA revenue which is based on income tax, corporate tax and sales tax. CA income tax withholding is up 3.5% from last year (Fig. 3) and is outpacing the US income tax withholding by large margin (Fig. 4). September revenue collections (Fig.5) from the state’s three largest taxes—the personal income tax, corporation tax, and sales tax—were ahead of budget projections by $4 billion (42 percent). Relative strength in income tax withholding and sales tax is consistent with trends in recent months. The personal income tax estimated payments reflects, in part, the fact that stock prices have now eclipsed pre-pandemic levels (capital gain tax). The corporation tax estimated payments suggests that corporations have revised upwards their expectations for profitability this year.

The extent of new business creation in California can be an important gauge of the health of the state’s economy. Past research suggests that new businesses account for a sizeable portion of job creation and also are more sensitive to swings in economic conditions than older businesses.

Fig. 6 shows weekly data on business creation in California from the U.S. Census. After crashing in the spring, new business creation has been very strong since July. In October, the number of new businesses was almost 30 percent above October 2019.

Venture capital funding is also another indicator of the strength of the state’s economy. Fig. 7 shows that the state is on tract to match 2019 which was a good year for venture capital funding in California.

Fig. 1


Fig. 2


Fig. 3


Fig. 4


Fig. 5


Fig. 6


Fig. 7


- - - Updated - - -

Based on the 7 day moving average of Covid cases and deaths i am so tempted to bail at this point and buy in on the next mini crash.

its really not looking good right now.

take the profit and run and wait on sidelines?

Are you going to sign a waiver of liability? All kidding aside. Depends on your holdings. I am just sitting tight. But you know my investment preference from my previous posts. I am more into stable growth stocks and ETFs. Not much into value stocks.

[Zan15]

Are you going to sign a waiver of liability? All kidding aside. Depends on your holdings. I am just sitting tight. But you know my investment preference from my previous posts. I am more into stable growth stocks and ETFs. Not much into value stocks.

i am sitting on a nice loss this year that i can use on my tax returns, i would hate to take the profit and offset that...

[Rasulis]

i am sitting on a nice loss this year that i can use on my tax returns, i would hate to take the profit and offset that...

Hah! That's one way of looking at it. On the other hand, if you do long-term investment, you don't have to pay capital gain taxes at all until you are ready to cash in. On top of that you pay reduced capital gain tax for long-term investment. For married couple filing jointly, you pay 0% for long-term annualized capital gain of 80k or less for 2020.

[Zan15]

Hah! That's one way of looking at it. On the other hand, if you do long-term investment, you don't have to pay capital gain taxes at all until you are ready to cash in. On top of that you pay reduced capital gain tax for long-term investment. For married couple filing jointly, you pay 0% for long-term annualized capital gain of 80k or less for 2020.

ya i can roll it, but i will have to do some heavy crunching as i creep up the income tax tables...

[Rasulis]

ya i can roll it, but i will have to do some heavy crunching as i creep up the income tax tables...

Yep. Once you get into capital gain, it gets complicated pretty fast. Especially if you do frequent trades. But then that's why we have tax planners. Their job is to make sure we pay the least amount of tax possible.

[Breccia]

The economy as we knew it might be over, Fed Chairman says

The Covid-19 pandemic brought the economy to a screeching halt, and while it has started its long road to recovery, the economy we knew is probably a thing of the past, said Federal Reserve Chairman Jerome Powell on Thursday.

"We're recovering, but to a different economy," Powell said during a virtual panel discussion at the European Central Bank's Forum on Central Banking.

The pandemic has accelerated existing trends in the economy and society, including the increasing use of technology, telework and automation, he said. This will have lasting effects on how people live and work.

While technological advances are generally positive for societies over the long term, Powell said, on a short-term basis they create disruption, and as the market adjusts to the new normal the pain isn't shared evenly.

For example, it's likely that lower-paid workers, as well as those in jobs requiring face-to-face interactions, such as retail or restaurant workers, will shoulder most of the burden of this shift. These groups, heavily skewed towards women and minorities, have already been among those most affected by pandemic layoffs, Powell said.

So, yeah, we've learned a lot in the last ten months. And a lot of that is "do we really need this?"

[Omega10]

The economy as we knew it might be over, Fed Chairman says



So, yeah, we've learned a lot in the last ten months. And a lot of that is "do we really need this?"

I agree 100% with this. The question is what will replace it? As Rasulis pointed out emphatically earlier, people with less than a bachelor's degree are in a bad place. Here is one prediction of what will happen if we DO have a lockdown (presumably 6 weeks) in around March of next year:

https://finance.yahoo.com/news/if-bi...183358871.html

Title: If President-elect Biden shuts down the US economy, the Dow would drop nearly 4,000 points: strategist

Excerpt:

The last thing bullish post-election season investors want to see is a nationwide lockdown to control the resurgent coronavirus under President-elect Joe Biden.

“3,000 or 4,000 [Dow] points lower at least,” veteran strategist David Nelson of Belpointe Asset Management told Yahoo Finance Live on the market reaction to a possible lockdown.

Damn. Down 4k takes us from around 29k to around 25k. This means that he is predicting the economy to stay resilient, presumably because he is expecting a sufficient amount of stimulus to be given to Americans so that few become homeless. I find this quite optimistic.

If we DON'T have a lockdown, until next summer the virus is likely to grow and grow and grow. (Maybe it will start to grow less in January if enough people get it that people start to pay attention to it?) This would hurt our economy more than a 6 week lock down would in my opinion. But with a lockdown, the economy will find a way to survive, at least that is an underlying premise of this prediction, and when the lockdown ends it will be like a new beginning.

The big question will be: where will the people without a bachelor's degree get work? This actually will eventually be the question even if we DON'T do a lockdown. It's just that with a lockdown the question will get a lot more attention. And, I think that this will change our economy in ways we can't even fathom right now. Hopefully there will be a lot of good changes to mellow out the bad things coming our way.

[Rasulis]

Biden won places that are thriving. Trump won ones that are hurting.

Are you better off than you were four years ago? That question has been at the heart of presidential campaigns since President Ronald Reagan first asked it in 1980. The general thinking has been that voters who are doing well would vote to reelect a sitting president. That’s not what happened in 2020.

This time around, those who were better off voted for a change in the White House.

The parts of America that have seen strong job, population and economic growth in the past four years voted for Joe Biden, economic researchers found. In contrast, President Trump garnered his highest vote shares in counties that had some of the most sluggish job, population and economic growth during his term.

“Counties where voters feel better off today than four years ago swung toward Biden,” said James Chung, co-founder of StratoDem Analytics, which studies local economic trends. “Counties that declined over the past four years were more likely to shift even more to Trump.”

In 2020, Biden won 477 counties that account for 70 percent of the U.S. economy, while Trump won 2,497 counties amounting to just shy of 30 percent of the economy, according to an analysis by Mark Muro, senior fellow at the Metropolitan Policy Program at the Brookings Institution, and his team. (A handful of counties are still awaiting final election results.) For Democrats, it was a notable increase from 2016, when Hillary Clinton won counties amounting to 64 percent of the U.S. economy.

Muro notes that Biden flipped half of the 10 most “economically significant” counties that Trump won in 2016, including Maricopa County, Ariz. (which includes Phoenix), Tarrant County, Tex. (which includes Fort Worth), Duval County, Fla. (which includes Jacksonville), Morris County, N.J. (a New York City suburb) and Pinellas County, Fla. (which includes St. Petersburg).

In 2012, 16 counties out of 100 counties with the largest economy voted for the GOP. That number dropped to 12 in 2016 and all the way down to 5 in 2020. Not sure if there is a solution to this. Obviously free market does not work. Despite the government best effort, funding and professional/tech jobs are becoming even more concentrated in several metro areas. Heavy taxation does not seem to make a difference. In 2019, CA and MA ranked #1 and #2 in patent registrations per capita and new business generation. Those are two states with the highest individual and corporation tax burdens. Texas with no individual and corporate taxes did not even make it into the top 10.

[Breccia]

Fears of double-dip recession rise alongside COVID-19 cases

A sharp spike in COVID-19 cases across the U.S. is threatening the economic recovery and increasing the odds of a double-dip recession.

Daily coronavirus infections surpassed 100,000 for the first time earlier this month; since then, they have surged past the 150,000 mark. At the same time, congressional leaders appear increasingly unlikely to strike a deal on another COVID-19 relief package, even as another round of key unemployment benefits are set to expire in the coming weeks.

Economists across the political spectrum have consistently warned that sustained growth is dependent on getting the coronavirus under control, with many now viewing the rise in infections with heightened concern.

“It’s alarming, to put it mildly," said Beth Ann Bovino, chief U.S. economist at S&P Global. "If this spreads and governments are forced to go back to lockdown measures, this very fragile recovery is sure to fail.”

Earlier in the year, S&P Global forecasted several scenarios for the economic recovery. The baseline scenario, which would lead to a 4 percent decline in gross domestic product, assumed Congress would pass a limited, $500 billion relief bill, and that the winter spike in COVID-19 would be under control.

Instead, there is no coronavirus relief package and cases are surging.

"Everything that is happening now, the risk of a resurgence in COVID-19 as well as policymakers walking away from stimulus negotiations -- those two factors are what my team had feared would happen,” said Bovino.

Without improvements on either front, a bigger economic contraction is likely, to the tune of 5.1 percent.

“It wouldn’t be as large as what we experienced in the first half of the year, but it would be a double dip,” Bovino said.

Cases are rising.

Hospitalizations are rising.

Lockdowns are rising.

Deaths are rising.

Trump intentionally allowed a lethal outbreak which has now killed as many people as the population of Baton Rouge, LA --

"Why them?"

100th biggest city in the states. And the year's not over yet. At 300,000 it's Pittsburgh. Anyhow, Trump allowed a lethal outbreak, ignored it, handwaved it, called any criticism of his handling of the lethal outbreak a hoax, and in the meanwhile encouraged half the country to continue to work and go out in public without masks, all of which without any form of COVID relief bill which his White House blocked unilaterally because McConnell sat this one out. The unemployment rate is now lower than early projections, but if these cases/hospitalizations/lockdowns/deaths continue to increase, not only will we have all those ruined lives, but the economy will drop below even where it was earlier.

Trump tried a short-term strategy, artificially inflating numbers until the election was over. He misjudged horrifyingly. The good news? He finally shot 250,000 people on Fifth Avenue and it did affect his numbers.

[Zan15]

Biden won places that are thriving. Trump won ones that are hurting.



In 2012, 16 counties out of 100 counties with the largest economy voted for the GOP. That number dropped to 12 in 2016 and all the way down to 5 in 2020. Not sure if there is a solution to this. Obviously free market does not work. Despite the government best effort, funding and professional/tech jobs are becoming even more concentrated in several metro areas. Heavy taxation does not seem to make a difference. In 2019, CA and MA ranked #1 and #2 in patent registrations per capita and new business generation. Those are two states with the highest individual and corporation tax burdens. Texas with no individual and corporate taxes did not even make it into the top 10.
]

Problem is most people, especially the right wing, do not understand taxes are relative to income.
Once you adjust they are not as bad as they assume they are.

3,000 property tax seems horrific to someone living in Kansas.

Northeast average income (CT/NJ/NY/MA/Etc) 75,000+, CA 72,000

(see if anyone notices a trend here)

Kansas 55k
Ohio $54,533
Indiana $54,325
Missouri $53,560
Florida $53,267
Idaho $53,089
Montana $52,559
North Carolina $52,413
Oklahoma $51,424
South Carolina $51,015
Tennessee $50,972
Alabama $48,486
Kentucky $48,392
New Mexico $48,059
Louisiana $47,942
Arkansas $45,726
West Virginia $44,921
Mississippi $43,567



On a 200k house

Kansas 1.41% $2,882
Mississippi 0.81% $1,654

34 Massachusetts 1.23% $2,518
43 New York 1.71% $3,497
49 New Hampshire 2.20% $4,498
48 Connecticut 2.11% $4,317
51 New Jersey 2.47% $5,064


With a 36%-75% income advantage all of a sudden MA, NY become cheaper property tax states then Kansas and those other states listed.
With a 70% income advantage CT/NJ become cheaper property tax state then even Mississippi


With these increase incomes and taxes you get better living, education, social programs, etc etc. all things that help support businesses and innovations.


But try explaining that to anyone on the right and a bunch on the left. half the times those people whom are complaing do not even pay much in taxes because they are in the bottom two brackets

- - - Updated - - -

Fears of double-dip recession rise alongside COVID-19 cases


Cases are rising.

Hospitalizations are rising.

Lockdowns are rising.

Deaths are rising.

Trump intentionally allowed a lethal outbreak which has now killed as many people as the population of Baton Rouge, LA --

"Why them?"

100th biggest city in the states. And the year's not over yet. At 300,000 it's Pittsburgh. Anyhow, Trump allowed a lethal outbreak, ignored it, handwaved it, called any criticism of his handling of the lethal outbreak a hoax, and in the meanwhile encouraged half the country to continue to work and go out in public without masks, all of which without any form of COVID relief bill which his White House blocked unilaterally because McConnell sat this one out. The unemployment rate is now lower than early projections, but if these cases/hospitalizations/lockdowns/deaths continue to increase, not only will we have all those ruined lives, but the economy will drop below even where it was earlier.

Trump tried a short-term strategy, artificially inflating numbers until the election was over. He misjudged horrifyingly. The good news? He finally shot 250,000 people on Fifth Avenue and it did affect his numbers.

Only thing holding this together right now is two things

- the huge rotation out of tech is giving the impression of a rally.
- The hopes democrats have more leverage to get the multi-trillion dollar stimulus done "soon"

[Masark]

The good news? He finally shot 250,000 people on Fifth Avenue and it did affect his numbers.

If right after being sworn in, trump went to 5th avenue and started killing someone every 2 minutes, 8 hours a day, 5 days a week, 52 weeks a year until today, his death toll would only be 233k people so far.

[Breccia]

This thread's title is increasingly inaccurate.

Despite Trump not conceding, and despite increasing lockdowns, the DOW is already up like 400 points.

In fact, the DOW has gone up pretty much every day since the election.

[Rasulis]

This thread's title is increasingly inaccurate.

Despite Trump not conceding, and despite increasing lockdowns, the DOW is already up like 400 points.

In fact, the DOW has gone up pretty much every day since the election.

Dow on verge of 30,000 and first record close in 10 months on back of Apple’s stock surge. Apple’s shares contribute nearly 1,300 points, more than twice that of any other Dow component from 29,000.

Actually more like triple of #2 (United Health).

[Deja Thoris]

This thread's title is increasingly inaccurate.

Despite Trump not conceding, and despite increasing lockdowns, the DOW is already up like 400 points.

In fact, the DOW has gone up pretty much every day since the election.

You mean a thread title from 2 years ago doesn't reflect where we are 700 odd days later?

Is that surprising to you or did you just come in here to state the obvious?

I mean, do you go into old threads that say "Gold is trading at $500 an ounce" to say "nu-uh it isn't"

[Breccia]

You mean a thread title from 2 years ago doesn't reflect where we are 700 odd days later?

Well, look back earlier in the year.

It was just a commentary that the market is actually improving.

[Zan15]

You mean a thread title from 2 years ago doesn't reflect where we are 700 odd days later?

Is that surprising to you or did you just come in here to state the obvious?

I mean, do you go into old threads that say "Gold is trading at $500 an ounce" to say "nu-uh it isn't"

damn i don't think this place was around in 2005 when gold was 500.....

Also i think you missed Breccia's implied statement, if you knew his pattern.

I think he means that the title is now possibly finally outdated after all this time because Trump is on his way out (even though he refuses to admit it) on top of everything else.


The democrats should be out there calling this the "Biden Bump" and taking credit. They need to learn a thing or two about marketing from donny and pubs

[Deja Thoris]

damn i don't think this place was around in 2005 when gold was 500.....

The democrats should be out there calling this the "Biden Bump" and taking credit. They need to learn a thing or two about marketing from donny and pubs

Sure, but that wouldn't be true either. The markets are doing what they are doing because uncertainty is being removed. Most importantly from the COVID situation, secondly from the questions about who won the election - that and the markets apparently liked split control of the house / senate which means either side could perversely spin their loss as good for the markets if they (for some odd) reason would choose to.

Yea, I know I'm going down a rabbit hole of insanity there, thats why I just prefer to stick to facts and the fact is, the reasons markets do what they do are many and varied.

[Rasulis]

California overestimated what it thought would be a jaw-dropping $54 billion budget deficit, creating a one-time $26 billion windfall for lawmakers to spend next year, the state's nonpartisan legislative analyst said Wednesday.

The state's spending plan was upended this year by the coronavirus pandemic, which forced the closure of many businesses and prompted millions of people to file for unemployment benefits.

Unsure of the virus's economic impact, the state Legislature approved a 2020-21 spending plan that tapped its savings account and relied on a combination of tax increases, spending cuts and deferrals to make up what policymakers believed would be a $54.3 billion deficit.

Legislative analyst Gabriel Petek said the state did too much, with the economic fallout from the virus so far not being as severe has lawmakers had feared.

While the pandemic has put millions of people out of work, most of them have been low-wage workers who earn less than $20 per hour. Petek said the people who earn more than $60 per hour and account for most of California’s tax payments have been largely unaffected financially, with many continuing to work from home.

The budget that lawmakers approved in June anticipated a 15% drop in tax collections because of the pandemic. But so far, tax collections are 9% higher than last fiscal year, with the state bringing in $11 billion more than expected. The result is a one-time windfall Petek estimates at $26 billion but said could fluctuate between $12 billion and $40 billion depending on what happens.

Economist! What do they know.