Arizona To Soon Reach A Critical Junction For COVID-19
Triggered by Tariffs, Shifting Expectations Send S&P 500 Sinking
It doesn't happen often, but sometimes, we find ourselves almost perfectly situated to capture two snapshots in time for the S&P 500 (Index: SPX).
We presented the first snapshot in time early in the morning of Monday, 13 May 2019, where we summed up what had happened to S&P 500 as it had been "knocked about by noisy U.S.-China trade negotiations" during the trading week ending on 10 May 2019 with just two charts and two paragraphs:
The S&P 500 (Index: SPX) set no new records during the week of trading ending on Friday, 10 May 2019, where stock prices mostly appeared to react to the noise generated by trade negotiations between the United States and China.
Overall, the index stayed within the typical range of values our dividend futures-based model would project if investors were primarily focused on the distant future quarter of 2020-Q1. Not uncoincidentally, this period coincides with the expectation that the Fed will next act to cut its Federal Funds Rate during that quarter, according to the latest probabilities indicated by the CME Group’s Fedwatch Tool.
The second snapshot in time comes from the end of trading on Monday, 13 May 2019, when after having been triggered by China's new retaliatory tariffs, investors responded by shifting a portion of their forward-looking focus from 2020-Q1 back toward the nearer-term future of 2019-Q4 and the more negative expectations associated with that point of time in the future. For our dividend futures-based model of how stock prices work, that shift in how far forward investors are looking was sufficient to send the S&P 500 sinking.
Having dropped below the range we would expect the S&P 500 to be if investors were focusing on 2020-Q1 in setting current day stock prices, or rather, the expectations for dividend growth that are associated with that distant future quarter, we would describe the current level of the S&P 500 as being consistent with investors splitting their attention between 2018-Q4 and 2020-Q1.
Not uncoincidentally, the sudden shift toward the earlier quarter of 2018-Q4 coincides with the heightened expectation that the Fed will next act to cut its Federal Funds Rate during that quarter, according to the latest probabilities indicated by the CME Group’s Fedwatch Tool. The following image shows how those probabilities have changed during the course of just one trading day:
As for why investors would suddenly be betting on the Fed cutting short term U.S. interest rates sooner rather than later, the Fed's minions have been priming their expectations for what they would do if the U.S.-China trade war slows the U.S. economy. Here's a sampling of relevant headlines since Thursday, 9 May 2019:
- Fed's Bostic says scheduled tariff hike could fuel inflation
- Tariff tumult boosts view that Fed may cut U.S. rates
- Fed's Bostic says tariff hikes could prompt rate cut if consumers pull back
- Fed can lower rates if U.S.-China trade spat causes slowdown: Rosengren
Now the question is will something happen to shift their attention back toward 2020-Q1 and prompt a rebound in stock prices? Or will they come to more closely focus upon 2019-Q4 and potentially send the S&P 500 down even more? If you can predict which point in time will come to capture the attention of today's investors and can set up your investing strategy accordingly, you could stand to benefit from what a behavioral finance expert like Robert Shiller might call irrational behavior, but which is really anything but.
3/1/19: Happy New 2019 or 2018 or 2008…
Australian Politics 2018-10-08 15:49:00
Kimberley Kitching is trying to cater for Labor’s conservative voters
Ms Kitching seems to have a strange idea of what constitutes “Judeo-Christian” values. She claims to adhere to them but voted for homosexual marriage, despite homosexuality being repeatedly condemned in both the Old and the New Testaments. And how does "Thou shalt not covet" jibe with socialism? No Leftist obeys that Commandment. She is right that many Labor voters have some conservative values but whether she can impress them with empty talk remains to be seen
Labor senator Kimberley Kitching — a close ally and friend of Bill Shorten — is moving to create a bipartisan parliamentary group that will defend “Judeo-Christian” and “Western-liberal democratic” values as she launches her credentials as a new style of social conservative within the Labor Party.
The Victorian, who was controversially hand-picked by the Opposition Leader to replace Stephen Conroy in the Senate, said she considered it part of her job to fight “smug elitism” and would seek to ensure the views of “inner-city elites” did not prevail over the “quiet wisdom of working people”.
“I think that sometimes Labor insiders tend to be more small-l liberal in their views than the people who vote for us,” Senator Kitching told The Australian.
She said the rise of the Greens had been good for the party as it helped create a “Corbyn-proof fence” that had protected Labor from the “more extreme and out of touch” parts of the Left. She also spoke against identity politics and virtue-signalling, saying it was intellectually “lazy” and had a negative impact on public debate.
Despite being a practising Catholic, Senator Kitching’s pitch as a Labor conservative is more cultural than religious and represents a shift from the traditional grouping of “LabCons” who have been guided by their faith in opposing same-sex marriage, abortion and euthanasia.
In interviews with The Australian, four LabCons — Don Farrell, Jacinta Collins, Helen Polley and Chris Ketter — denied claims their socially conservative views were maligned in the party as it became increasingly progressive.
The MPs — who voted No last year to same-sex marriage — said Labor needed to be a broad church to ensure it appealed to conservative working-class voters.
Senator Kitching — who voted Yes to same-sex marriage but is opposed to euthanasia — said “Judeo-Christian, Western-liberal democracy” was the “very best way” for people to “organise themselves” and its principles should be more staunchly defended.
She will attempt to launch a Defence of Democratic Institutions Parliamentary Friendship Group, inviting MPs from across the aisle as well as business leaders and academics.
Avoiding the politically loaded term “Western values”, Senator Kitching said the group would champion “liberal-democratic values”, discuss policy ideas and help shape the political agenda.
“The fact is we must remain vigilant in order to protect and safeguard our Judeo-Christian, Western-liberal democracy from both external and internal threats,” she said.
Senator Kitching — who has defended her record at the Health Services Union despite being accused of misconduct by the trade union royal commission — said she preferred the term “moderate” to social conservative, a sentiment shared by Senator Collins and Senator Ketter.
Senator Farrell, Labor’s Senate deputy leader and a leading figure in the conservative shoppies faction, said many working-class Labor voters had traditional values.
He said his Catholic views drove him towards the Labor Party because of the church’s teachings on social justice. “On the one hand you can be a social conservative but also support the concept of social justice,” he said, adding that he did not believe the party would eventually junk its conservative links.
Senator Collins said her views were accepted by her parliamentary colleagues, despite a Labor MP telling The Australian the LabCons were a “dying” force within the party and their views were increasingly marginalised.
“I have never felt lonely,” Senator Collins said. “I’m a collectivist. I don’t relate at all to the Liberal (Party) traditions of individualism, so I have found Labor fits much more neatly with my approach to achieving the common good.”
SOURCE
A State government codifies ‘white privilege’ slur for its bureaucrats
Government departments in South Australia have been criticised for seemingly forcing bureaucrats to acknowledge “white privilege” in Aboriginal cultural awareness training.
Conservative crossbench senator Cory Bernardi told The Australian that public servants had contacted his office in fear of losing their jobs after refusing to participate in the training, which required them to acknowledge their “white privilege”.
“I’ve had public servants contacting my office, fearful for their jobs because in good conscience they cannot undergo this mandatory indoctrination,” Senator Bernardi said yesterday.
“They are being discriminated against because political correctness and bureaucracy have run out of control under the noses of the major parties.”
National debate over the use of the term “white privilege” erupted in January when it was revealed that new codes of conduct for nurses and midwives referenced “a decolonising model of practice based on dialogue, communication, power sharing and negotiation, and the acknowledgment of white privilege”.
The codes do not require nurses or midwives to declare or apologise for white privilege.
Two SA Health documents for “cultural” and “workplace” learning advise staff “there is an undeniable relationship between the continuing impact of colonisation and racism on the current health status of Aboriginal people”.
“Aboriginal people have been negatively impacted by inequitable government policies and the consequential ongoing racism and discrimination,” the documents say, noting that the material will “improve the cultural competence of the SA Health workforce through a better understanding of the impact of colonisation on Aboriginal health outcomes”.
A “learning outcomes” section requires staff to define white privilege and the effect of white privilege on Aboriginal health.
Staff are required to “challenge and respond to ‘racist’ behaviour and racial stereotypes” and “recognise the impact of white privilege on access to services”.
The “learning frameworks” also require staff to explain cultural self-awareness and identify their own cultural values and practices, identify examples of “white privilege” and analyse how “white privilege” impacts on Aboriginal people’s experience of health care services.
Premier Steven Marshall, who formed the first Liberal government in South Australia in 16 years in March, also has responsibility for the state’s Aboriginal Affairs portfolio.
Mr Marshall’s own department “actively encourages public sector employees to participate in Aboriginal cultural awareness training”, according to its website.
The South Australian Department of Environment, Water and Natural Resources has an online “reconciliation action plan” that states: “We seek to be able to better recognise the influence colonisation and white privilege has on the department’s internal and external interactions with Aboriginal people, their nations and communities.”
Mr Marshall insisted that cultural awareness training was not compulsory. “Cultural awareness training is an option made available to public sector employees,” he said.
“The use of the term ‘white privilege’ … (is) not a term that I would personally use.”
Senator Bernardi said: “This politically correct nonsense is offensive, if not racist, towards many Australians.”
SOURCE
Schoolgirl, 6, pulled out of school after cruel bullies punch her in the face, pull her hair and expose themselves to her - as teachers say they can't do anything to stop them
The Left-influenced breakdown in school discipline again
A family has taken the drastic step of pulling their six-year-old girl out of school, amid claims she was relentlessly bullied for months.
Gold Coast youngster Summah Hillhouse says she is too scared to go to school after she was repeatedly punched in the face, called names and had her hair pulled.
Summah says she told teachers what was happening but nothing was done.
'She said 'Summah it is not called bullying, she doesn't do it to you every single day.' It made me feel sad,' the little girl told A Current Affair.
Her grandmother Kim Den Hertog described the situation as 'absolutely ridiculous.' You can't send a six-year-old to school when she is frightened. It's like then we become the abusers,' she said. 'We are meant to send our children to school to learn and to be protected, but they're not being protected.'
Her family also claims two older boys flashed their private parts at Summah and a friend in the school playground last month.
The recent bullying has given Shaye Hillhouse no other choice but to try and find her youngest daughter another school before term four starts in the coming weeks.
'The teachers don’t seem to be able to do anything about it. It’s so frustrating,' she told The Gold Coast Bulletin last month.
'We had a meeting with a deputy principal, who was very good to us, and she promised there would be consequences for the offender but it’s too late. I've been to Southport police but I was told there is nothing they can do because a child under the age of 11 cannot be criminally responsible for his or her behaviour.'
A Queensland Department of Education spokeswoman told Daily Mail Australia it cannot comment on individual cases for student privacy reasons. 'Bullying is not tolerated in Queensland state schools. Any situation that threatens the safety and wellbeing of students is treated extremely seriously, and dealt with as a matter of urgent priority,' the spokeswoman said in a statement.
'All Queensland state schools are committed to providing a safe, respectful and disciplined learning environment for students and staff. 'All schools have a Responsible Behaviour Plan which sets out very clear standards and expectations for all students. [Translation: Bullsh*t]
'The school involved continues to work closely with the students and their families to address their concerns.'
Meanwhile, Summah had this message for bullies. 'I would say stop bullying somebody because that's not nice,' she said.
SOURCE
Does inequality matter?
This week we hosted an interesting discussion on inequality.
CIS Senior Fellow Robert Carling argued inequality is actually an integral part of a market economy, because the incentive of massive wealth drives and rewards innovation and risk taking. He noted that “if you accept that markets are the best way to organise economic activity … then you must accept some degree of inequality”.
Importantly, he raised the often ignored trade-off between equity and economic efficiency; and the fact that people mistakenly believe increasing taxes and redistributing income is essentially costless. This is not the case.
Another interesting point of view that both Melinda Cilento from CEDA and Jonathan Coppel from the Productivity Commission shared, was that the perception of inequality was also different from reality. When asked, people feel they are worse off and that the benefits of growth are only accruing to the rich.
Yet inequality in Australia has not increased substantially in recent years — in fact it may have decreased. Further, wages have increased across the spectrum in Australia.
In some ways, this is a case where Australia has imported arguments from the US and the UK assuming that they apply here. It’s also related to an increasing focus on, and anger towards, the rich.
Pointing out that the top 1% (or the top 1% of the top 1%) are doing really well and pretending that is the same as broad inequality is an effective way of stoking resentment.
It’s telling that the measures to combat inequality are largely on the revenue side. Focusing on how rich people are, rather than poverty, allows progressives to advocate for massive tax increases and more regulation on the productive sectors of the economy.
These are exactly the kind of things that will hammer economic growth, which — as Carling noted — may harm the disadvantaged more than the redistribution helps them. Tax increases on the rich are perennially popular, but they will not lead to greater prosperity
One big lesson to be drawn from the populist revolt that put Trump in the White House is that people don’t want more redistribution, they want more opportunities. Many in the working class are rejecting the perennial solution of the left (more money and fewer obligations) in favour of the opposite: re-establishing what they believe is the broken link between work and success.
SOURCE
Posted by John J. Ray (M.A.; Ph.D.). For a daily critique of Leftist activities, see DISSECTING LEFTISM. To keep up with attacks on free speech see Tongue Tied. Also, don't forget your daily roundup of pro-environment but anti-Greenie news and commentary at GREENIE WATCH . Email me here