The inverted yield curve

[TexasTiger 12,800]

Explained in a tweet thread 

https://mobile.twitter.com/moorehn/status/1161766324642750465

[AU64 10,122]

Fed could solve this problem if it chose to.  Part of the problem is that in Europe, many countries now have negative interest rates and "money" is looking for a better place to work.  I understand that the US bond market is flooded with European sourced money....and people are willing to take lower ROR than might be the normal situation. 

JMO but selling stocks and taking a big loss now based on some econ theory that a recession might arrive within 2 years......DUMB. 

[SaltyTiger 7,761]

21 hours ago, TexasTiger said:

Explained in a tweet thread 

https://mobile.twitter.com/moorehn/status/1161766324642750465

NBC and USA Today say major recession Brother Tex

[TexasTiger 12,800]

6 minutes ago, SaltyTiger said:

NBC and USA Today say major recession Brother Tex

It’s generally an early predictor.

[TexasTiger 12,800]

13 hours ago, AU64 said:

Fed could solve this problem if it chose to.  Part of the problem is that in Europe, many countries now have negative interest rates and "money" is looking for a better place to work.  I understand that the US bond market is flooded with European sourced money....and people are willing to take lower ROR than might be the normal situation. 

JMO but selling stocks and taking a big loss now based on some econ theory that a recession might arrive within 2 years......DUMB. 

Trump could have a more stable approach to trade.

[AU64 10,122]

12 minutes ago, TexasTiger said:

Trump could have a more stable approach to trade.

I agree but not sure that is a major factor....European economy is in the toilet with negative interest rates which is affecting us....and JMO but it is past time the US does something about the China trade situation and if we have to take a little pain, it's probably needed...

[SaltyTiger 7,761]

21 minutes ago, TexasTiger said:

It’s generally an early predictor.

Well hopefully NBC and USA Today are wrong again......but get their point.

[TexasTiger 12,800]

8 minutes ago, AU64 said:

I agree but not sure that is a major factor....European economy is in the toilet with negative interest rates which is affecting us....and JMO but it is past time the US does something about the China trade situation and if we have to take a little pain, it's probably needed...

Trump’s trade war is a factor in Germany as is the Brexit he cheered on:

https://www.google.com/amp/s/beta.washingtonpost.com/world/2019/08/07/germany-was-europes-economic-growth-engine-trade-wars-could-drive-it-recession/%3foutputType=amp

[SaltyTiger 7,761]

15 minutes ago, TexasTiger said:

24 minutes ago, AU64 said:

 

Trump’s trade war is a factor in Germany as is the Brexit he cheered on:

Why does Europe depend on Germany as a growth engine? See the article is laying their economy at Trumps feet. Trump was not elected on servicing the European economy.

 

 

 

[japantiger 4,051]

37 minutes ago, TexasTiger said:

Trump’s trade war is a factor in Germany as is the Brexit he cheered on:

https://www.google.com/amp/s/beta.washingtonpost.com/world/2019/08/07/germany-was-europes-economic-growth-engine-trade-wars-could-drive-it-recession/%3foutputType=amp

Oh man...this is the height of TDS...blaming Trump for Brexit and Germany's growth.  Wow. 

[TexasTiger 12,800]

56 minutes ago, SaltyTiger said:

Why does Europe depend on Germany as a growth engine? See the article is laying their economy at Trumps feet. Trump was not elected on servicing the European economy.

 

 

 

 

28 minutes ago, japantiger said:

Oh man...this is the height of TDS...blaming Trump for Brexit and Germany's growth.  Wow. 

Thanks for telling me the economic actions of the leader of the world’s largest economy has no impact outside our borders. I appreciate the “insight.” It’s good to know the global economy ain’t a real thing.

[AU64 10,122]

8 hours ago, TexasTiger said:

 

Thanks for telling me the economic actions of the leader of the world’s largest economy has no impact outside our borders. I appreciate the “insight.” It’s good to know the global economy ain’t a real thing.

Impact ?  sure....but sounds as if  someone needed to explain to you that the US might be the world's largest economy but the US president should be thinking about the US first in matters of this type.  

The world's defense force and the world's sucker when it comes to trade policy?     JMO but Germany has been getting a mostly free ride in NATO and in trade policy too and China screwing us in trade matters......time for it to stop..   

[TexasTiger 12,800]

13 minutes ago, AU64 said:

Impact ?  sure....but sounds as if  someone needed to explain to you that the US might be the world's largest economy but the US president should be thinking about the US first in matters of this type.  

The world's defense force and the world's sucker when it comes to trade policy?     JMO but Germany has been getting a mostly free ride in NATO and in trade policy too and China screwing us in trade matters......time for it to stop..   

That’s fine if you think it’s worth the costs— just don’t pretend there are no costs to the actions you deem warranted. It’s a global economy. We are interlinked. When the US made a habit out of bad loans, the world economy sank. A politician making that case needs to admit there will be pain instead of pretending the media is just making it up. You do backflips to defend every crazy thing he says, this is no different.

[japantiger 4,051]

14 hours ago, TexasTiger said:

 

Thanks for telling me the economic actions of the leader of the world’s largest economy has no impact outside our borders. I appreciate the “insight.” It’s good to know the global economy ain’t a real thing.

But, But, But Orange Man Bad .... If the DE economy has issues; maybe you should explore their economic policies:  

1) They run a large budget surplus ... they have the money to stoke their economic growth if they want to.  What are they waiting on?  I guess it's  just easier to complain and get sympathy from uninformed Americans.

2) If their auto sales are slow (or any of their export markets) they have a choice; cut trade barriers and make it easier; their tariffs are 5x what we charge to import.  That is why they are now paying higher tariffs.  If they want the US market gravy train again; just cut their tariffs and equalize with what we charged them.  Why do you think they won't do that?  More importantly, why are you such a blind partisan you can't see the basic fairness of this.   Why should Americans subsidize DE industry?

3) They've driven domestic energy costs out the roof with their push away from fossils and nuclear to wind/solar.   Electricity costs are up 50% in less than 2 years.  If they want their consumers to drive more economic activity; they should stop looting them in the name of a green energy unicorn.  

4) lastly, why should we continue to pay for their defense?  They pay 1.3% of their GDP toward NATO...we pay 4.5%.  Why should US taxpayers subsidize their national defense.  More importantly, why should young Americans do what young Germans won't do and defend their nation?  We're on the 4th successive generation of my family going to Europe to either conquer the Germans (my father and grandfather) or to  defend them (me and my son).  Enough.  And what are we defending them from?  Russia?  Their signing pipeline deals giving RU the ability to implement energy blackmail.  

DE's issues are created by DE; no one else.    

[TexasTiger 12,800]

6 minutes ago, japantiger said:

But, But, But Orange Man Bad .... If the DE economy has issues; maybe you should explore their economic policies:  

1) They run a large budget surplus ... they have the money to stoke their economic growth if they want to.  What are they waiting on?  I guess it's  just easier to complain and get sympathy from uninformed Americans.

2) If their auto sales are slow (or any of their export markets) they have a choice; cut trade barriers and make it easier; their tariffs are 5x what we charge to import.  That is why they are now paying higher tariffs.  If they want the US market gravy train again; just cut their tariffs and equalize with what we charged them.  Why do you think they won't do that?  More importantly, why are you such a blind partisan you can't see the basic fairness of this.   Why should Americans subsidize DE industry?

3) They've driven domestic energy costs out the roof with their push away from fossils and nuclear to wind/solar.   Electricity costs are up 50% in less than 2 years.  If they want their consumers to drive more economic activity; they should stop looting them in the name of a green energy unicorn.  

4) lastly, why should we continue to pay for their defense?  They pay 1.3% of their GDP toward NATO...we pay 4.5%.  Why should US taxpayers subsidize their national defense.  More importantly, why should young Americans do what young Germans won't do and defend their nation?  We're on the 4th successive generation of my family going to Europe to either conquer the Germans (my father and grandfather) or to  defend them (me and my son).  Enough.  And what are we defending them from?  Russia?  Their signing pipeline deals giving RU the ability to implement energy blackmail.  

DE's issues are created by DE; no one else.    

I know trumpbots have to poopoo budget surpluses now, but still a bit unnerving to see it in print. Also, spend more time criticizing allies than Russians. You’re checking the boxes!

Again, sell the policy but tell folks the negative consequences are worth it. There’s a connection. I’m just advocating for recognizing reality. Admit that then sell it. Trump doesn’t do that. Conman and you’re a mark.

[japantiger 4,051]

5 hours ago, TexasTiger said:

I know trumpbots have to poopoo budget surpluses now, but still a bit unnerving to see it in print. Also, spend more time criticizing allies than Russians. You’re checking the boxes!

Again, sell the policy but tell folks the negative consequences are worth it. There’s a connection. I’m just advocating for recognizing reality. Admit that then sell it. Trump doesn’t do that. Conman and you’re a mark.

You really struggled to connect dots.  If DE has a growth challenge,  their first remedy should be their own resources.  They run a surplus.  They should spend it to stimulate their economy.  Please explain how that is poo pooing budget surpluses.  It's the Keynsian thing to do...aren't you leftists in love with Keyne's?

Everything else you say is to avoid a real discussion.

[TexasTiger 12,800]

14 hours ago, japantiger said:

You really struggled to connect dots.  If DE has a growth challenge,  their first remedy should be their own resources.  They run a surplus.  They should spend it to stimulate their economy.  Please explain how that is poo pooing budget surpluses.  It's the Keynsian thing to do...aren't you leftists in love with Keyne's?

Everything else you say is to avoid a real discussion.

You either have zero understanding of GLOBAL economics or you’re so far into the Trump45 cult to see reality. They can stimulate their economy with stimulus, but its an export/import economy, like all other modern economies.

[homersapien 11,352]

On 8/15/2019 at 8:41 AM, AU64 said:

Fed could solve this problem if it chose to.  Part of the problem is that in Europe, many countries now have negative interest rates and "money" is looking for a better place to work.  I understand that the US bond market is flooded with European sourced money....and people are willing to take lower ROR than might be the normal situation. 

JMO but selling stocks and taking a big loss now based on some econ theory that a recession might arrive within 2 years......DUMB. 

Any sort of market timing strategy is DUMB IMO.

Maybe a little less so if you are relatively old and might need all the money you have before you die, but certainly dumb if you're a young person.

[AU64 10,122]

3 minutes ago, homersapien said:

Maybe a little less so if you are relatively old and might need all the money you have before you die,

diversity.....which means less in equities as you age.  

And of course, for every "investor (trader) who bailed out of the market the other day, there was another who thought it looked like a good buying opportunity.    Interesting that the MSM like CNBC, FoxN only talk to the sellers....and rarely ask the buyers why they decided to buy at that moment. So the picture always looks like a really bad day for the market ...which I guess it was....but some investors/traders found that stocks were "on sale" and took advantage. 

[japantiger 4,051]

9 hours ago, TexasTiger said:

You either have zero understanding of GLOBAL economics or you’re so far into the Trump45 cult to see reality. They can stimulate their economy with stimulus, but its an export/import economy, like all other modern economies.

Unlike you, who talks about all this in the abstract; I've been running global businesses for over 20 years.  Let me help you. 

• If they want to stimulate their imports, they need to put more money in the hands of their citizens; hence, stop gouging them on their energy bills and with hi taxes.  When the people have more money in their hands; they spend more. 
• To stimulate their exports to the US; they simply need to equalize their tariffs to the US.  The current increased tariffs are their own doing.  They had a choice.  Their tariff's were 5x those charged by the US.  Failure to lower tariffs to US levels; or make any concession is their own fault.  Your failure to acknowledge this is childish.  We've been getting screwed for decades.  No, it's not just childish; it's immoral.  Politicians who created this regime have betrayed their oaths and the people they were supposed to represent. 

You are woefully ignorant (likely willfully) of what has been happening for the last 30 years.  Poor tax and tariff policies forced US businesses to make stupid decisions for years.  In my own business; it was more profitable for me to expand to CH or IN or almost anywhere else vs investing another $$ in the US.  Tech profits in CH were taxed at only 5%;  and substantial subsidies provided by CH states.  In most countries, the tax differential was ~15%.  That's a lot of profit room.  The tax policies have been the driving force in exporting US jobs; well, that is until the Trump tax cuts.    I have personally brought 400 jobs back to the US in the last 2 years and increased my US investment spend to more than my entire global spend. 

[TexasTiger 12,800]

16 minutes ago, japantiger said:

Unlike you, who talks about all this in the abstract; I've been running global businesses for over 20 years.  Let me help you. 

• If they want to stimulate their imports, they need to put more money in the hands of their citizens; hence, stop gouging them on their energy bills and with hi taxes.  When the people have more money in their hands; they spend more. 
• To stimulate their exports to the US; they simply need to equalize their tariffs to the US.  The current increased tariffs are their own doing.  They had a choice.  Their tariff's were 5x those charged by the US.  Failure to lower tariffs to US levels; or make any concession is their own fault.  Your failure to acknowledge this is childish.  We've been getting screwed for decades.  No, it's not just childish; it's immoral.  Politicians who created this regime have betrayed their oaths and the people they were supposed to represent. 

You are woefully ignorant (likely willfully) of what has been happening for the last 30 years.  Poor tax and tariff policies forced US businesses to make stupid decisions for years.  In my own business; it was more profitable for me to expand to CH or IN or almost anywhere else vs investing another $$ in the US.  Tech profits in CH were taxed at only 5%;  and substantial subsidies provided by CH states.  In most countries, the tax differential was ~15%.  That's a lot of profit room.  The tax policies have been the driving force in exporting US jobs; well, that is until the Trump tax cuts.    I have personally brought 400 jobs back to the US in the last 2 years and increased my US investment spend to more than my entire global spend. 

I don’t think Germans want any advice on the economy from America. They manage things better than we do and their government works more effectively than ours. You guys keep trying to change the subject because you can’t see Trump causes market upheaval with his impulsivity. You’ve embraced trillion dollar deficits during a “booming” economy. That’s some special kinda genius you’ve got working there. Glad your gumball business is doing well, though. 👍

[japantiger 4,051]

1 hour ago, TexasTiger said:

I don’t think Germans want any advice on the economy from America. They manage things better than we do and their government works more effectively than ours. You guys keep trying to change the subject because you can’t see Trump causes market upheaval with his impulsivity. You’ve embraced trillion dollar deficits during a “booming” economy. That’s some special kinda genius you’ve got working there. Glad your gumball business is doing well, though. 👍

You  mistake my comments.  I think the "upheavel" is good; and long, long overdue.  The fact that the DE's aren't nimble enough to deal with it is DE's problem.  Maybe you should read Michael Porter. They'd utilized an advantaged tax and tariff policy to get a temporary/unsustainable advantage in the US markets.  Remove those; suddenly the DE aren't quite as invincible as they thought....hhhmmm, does that have any parallel in history?  Our political leaders were playing us for chumps. 

Gumball business?  That's all you've got.    Those 400 US families that now have great high paying tech jobs see it differently.  How about you?

As for the deficit, it needs to be dealt with.  Maybe we can get Congress to submit a budget that deals with it.  Neither party seems interested.  Tax revenues are up 10% since Trump took office ($3.2T to $3.66T).  The FED's inability to control spending is a huge issue. 

[TexasTiger 12,800]

2 hours ago, japantiger said:

You  mistake my comments.  I think the "upheavel" is good; and long, long overdue.  The fact that the DE's aren't nimble enough to deal with it is DE's problem.  Maybe you should read Michael Porter. They'd utilized an advantaged tax and tariff policy to get a temporary/unsustainable advantage in the US markets.  Remove those; suddenly the DE aren't quite as invincible as they thought....hhhmmm, does that have any parallel in history?  Our political leaders were playing us for chumps. 

Gumball business?  That's all you've got.    Those 400 US families that now have great high paying tech jobs see it differently.  How about you?

As for the deficit, it needs to be dealt with.  Maybe we can get Congress to submit a budget that deals with it.  Neither party seems interested.  Tax revenues are up 10% since Trump took office ($3.2T to $3.66T).  The FED's inability to control spending is a huge issue. 

You’re some dude on the internet claiming to be an IT magnate. Maybe you are. You don’t act like it, but who knows.

Again, if the “plan” in Trumps multidimensional chess game involves ultimate benefits for the pain caused, sell that to the people. Our President has never done that. He acts on whim and impulse and you try to craft it into a master plan. You can’t admit Trump doesn’t give a damn about deficits. He cares about stuff like this:

 

[homersapien 11,352]

".........The U.S. and global economies have long since absorbed the benefits of the tax cuts Mr. Trump and his fellow Republicans delivered at the end of 2017. What remains in the U.S. arsenal to fight a recession, should it come, is not much: The Federal Reserve is cutting its (already low) interest rates, and the budget deficit is already a trillion dollars. Another thing markets have absorbed is the lesson that the president does not have a strategic objective for his trade fight with China other than to perpetuate it, his recent delay in consumer-goods tariffs notwithstanding. Nor does he seem concerned by instability brewing in Europe because of Brexit — except to encourage it. It is sinking in on businesses that Mr. Trump’s trade war, Brexit and other threats to the global economy may be here to stay at least through 2020. Long-standing assumptions about supply chains, currency values and capital flows upon which companies base their decisions have been upended.

Mr. Trump has delivered a shock to the global economic system, and until investors can figure out the repercussions, they will be that much less likely to invest and create jobs. Perhaps that system was due for a shake-up, especially to the extent China was abusing it. But Mr. Trump could have delivered necessary change less disruptively if he had taken on China in concert with European, Asian and North American allies rather than antagonizing them all at once, as he has done. What the world needs now is what all U.S. presidents since World War II have offered: stabilizing leadership. Alas, that is one thing Mr. Trump is fundamentally unsuited to provide."

https://www.washingtonpost.com/opinions/the-scare-of-a-recession-calls-for-exactly-what-trump-cant-provide/2019/08/17/34cbce0a-c04e-11e9-b873-63ace636af08_story.html

[japantiger 4,051]

On 8/17/2019 at 11:35 PM, TexasTiger said:

You’re some dude on the internet claiming to be an IT magnate. Maybe you are. You don’t act like it, but who knows.

Again, if the “plan” in Trumps multidimensional chess game involves ultimate benefits for the pain caused, sell that to the people. Our President has never done that. He acts on whim and impulse and you try to craft it into a master plan. You can’t admit Trump doesn’t give a damn about deficits. He cares about stuff like this:

 

IT magnate?...gumball business?...petty...how does an IT magnate behave by the way? 

A business leader grows a business, makes a profit, create jobs, provides for families, cares for their people, meets customer needs, has a clear eyed view of how national tax, tariff and trade policies work, gives back to the communities they work in, is impatient, ...but hey, maybe you've got another idea from your vast experience.  All I hear from you on here is whine "but, but,  Orange Man bad" and get the basic facts wrong on what has driven global trade the last 40 years.

You're like the leftists atheist politicians constantly citing what "Jesus would want"; you don't have any idea. In this thread; you claimed both that Trump was responsible for everything going on in the DE economy; and then after that failed; said that the DE didn't want/need our help and everything DE worked better than America anyway.  You're just making s*** up.   

You want to engage in a real business discussion I'll be happy to do it.  But get your basic facts right and actually stick to a story.  Our tax and trade policies destroyed entire industries in this country and built the middle classes of other nations at the expense of Americans.  That is unforgivable; and the political whore class that you so lovingly embrace is responsible for it.  Biden, Ryan, Pelosi, Schumer, Clinton, Bush, Obama, Warren, Bernie, et al.

I  get it.  It has to hurt you being "wrong on Trump 100% of the time, every time".  Whether it was his electibility, Kavanaugh, Taxes, Jobs, foreign policy; tariffs, Russia/Russia/Russia you name it.  But, you're the one with the issue.  Your constantly shouting into the wind is just boring.   Maybe try the sports thread more; I'm sure Gus Biden could use some support.