Monday, March 23, 2020

THE TRUMP DEPRESSION - WILL THE BILLIONAIRE CLASS DOUBLE ITS WEALTH AS THEY DID IN THE RECESSION OF 2008?


Dow wipes out all gains since 2016 election at session low

At its low point today, the Dow erased all the gains it accumulated since the November 2016 election of President Donald Trump.
The index briefly fell below 18,333 points, the level at which it closed on Election Day in 2016.
Since that date, the Dow climbed more than 60% to its all-time high of 29,551 in February. The coronavirus crisis has made these gains vanish in a matter of weeks.
The Dow has bounced back since dropping below that key level today. Where it closes today remains an open question.

TRUMP’S ADMINISTRATION IS INFESTED WITH GOLDMAN SACHS JUST AS OBAMA-BIDEN’S WAS WITH JAMIE DIMON OF JP MORGAN

 

$$$$$$$$$$$$$$$$$$$

Goldman Sachs Bankster “King of the Foreclosures” Treasury Secretary Steven Mnuchin vows that the Goldman Sachs infested Trump Admin will hand no-strings massive socialist bailouts to Trump Hotels. Mnuchin says the welfare will exceed the Bankster-owned Democrat Party’s massive bailout of Obama crony Jamie Dimon of J P Morgan’s bailout in 2008

 

Trump Is Surrounded by Criminals

https://mexicanoccupation.blogspot.com/2019/11/the-fall-of-donald-trump-final-days.html

 

“The legal ring surrounding him is collectively producing a historic indictment of his endemic corruption and criminality.” JONATHAN CHAIT
TRUMPERNOMICS FOR THE RICH…. and his parasitic family!
Report: Trump Says He Doesn't Care About the National Debt Because the Crisis Will Hit After He's Gone


 "Trump's alleged comment is maddening and disheartening,
but at least he's being straightforward about his indefensible
and self-serving neglect.  I'll leave you with 
this reminder of the scope of the problem, not that anyone in power is going to do a damn thing about it."


TRUMPERNOMICS:
THE SUPER RICH APPLAUD TWITTER’S TRUMP’S TAX CUTS FOR THE SUPER RICH!

"The tax overhaul would mean an unprecedented windfall for the super-rich, on top of the fact that virtually all income gains during the period of the supposed recovery from the financial crash of 2008 have gone to the top 1 percent income bracket."

 

Global economic slump accelerating

 
As the coronavirus spreads, taking more lives at 

an escalating rate, its effects are penetrating ever 

deeper into the global economy.


GOLDMAN  SACHS warned last week that US 

gross domestic product (GDP) would contract by 

24 percent in the second quarter. There are 

forecasts that up to 5 million jobs will be lost in 

the American economy this year, with the fall in 

economic output to total as much as $1.5 trillion.


GOLDMAN  expects, at this stage, that US output

will contract 3.1 percent this year and the 

unemployment rate will rise to 9 percent from the 

current level of 3.5 percent. This is on a par with 

the jobless rate of 10 percent in October 2009, 

following the financial meltdown of 2008.


But just as the health impact of the virus was significantly underestimated, the same may apply to the current economic forecasts.
“Things look so gloomy right now that perhaps we should be grateful if we can get out of this health crisis with a brief recession,” Bernard Baumohl of the Economic Outlook Group told the Wall Street Journal.
“You just cannot rule out the prospect of a longer, more destructive depression,” he said.
In other words, a relatively short but deep recession is now the “best case” scenario.
The eurozone is expected to experience a fall of around 10 percent of GDP. But this forecast could well be exceeded. There is no end in sight to the spread of the virus and no clear assessment of the economic effect of the shutdowns being implemented to try to combat it.
In an interview with the Financial Times, the chief economist of the European Union, Paolo Gentiloni, indicated that officials were working on new measures.
“The consensus is growing day by day that we need to face an extraordinary crisis with extraordinary tools,” he said.
“This idea of a V-shape [recovery] that you can see in the first semester of 2020 is now completely impossible. We have no previous analysis of the impact of such a widespread lockdown in major economies.”
Gentolini conducted the interview as part of a political battle inside the EU over the economic and financial measures, bringing further into the open the widening rifts between leading member states.
Powerful forces in Germany and the Netherlands are opposed to all-European action, regarding this as a bailout for weaker economies such as Italy.
On the other side, the French Finance Minister Bruno Le Maire last week warned that failure to act in a unified manner meant the eurozone was in danger of disappearing.
European Financial Times columnist Wolfgang Münchau wrote yesterday that the situation facing the eurozone was “far worse” than the sovereign debt crisis of 2012.
“The coronavirus will prove to be an economic shock, a corporate solvency crisis and a political crisis all folded into one,” he said.
Münchau noted that European countries had fiscal stabilisers such as unemployment insurance, but these “shock absorbers” were designed to deal with “normal fluctuations.” They were not “big enough or strong enough for emergencies like this one.”
Pointing to the deepening divisions in Europe, Münchau wrote that not everyone would want to be in a monetary union with countries like the Netherlands where the prime minister was “ideologically opposed” to all-European measures. “This sort of unwilling partnership is not sustainable.”
In the absence of data on overall output, the Financial Times conducted a survey, particularly covering retail and services, to give some indication of what to expect.
It showed that vehicular traffic had halved in many of the world’s largest cities, while spending in restaurants and cinemas had collapsed.
Greg Daco, the chief US economist at Oxford Economics, said: “Looking at the data across various sectors of the US economy, it appears we could be heading for the most severe contraction in consumer spending on record.”
The rapid shrinkage in the real economy will further escalate the already severe crisis in the financial system, and extend from the stock and credit markets to the banks.
In a Financial Times comment, Sheila Bair, the former chief of the US Federal Deposit Insurance Corporation, wrote: “Big banks throughout the world are substantially exposed to the pandemic, particularly as it hurts corporate borrowers.”
Around the world, non-financial corporations covering every industry, including the hard-hit energy, transport, retail and hospitality sectors, had racked up debts to the tune of $70 trillion, she wrote.
“To survive, they are increasingly hoarding cash and tapping into their massive back-up lines of credit, placing additional strain on the banking system,” Bair wrote, noting that as bond markets “seize up,” bank credit may be their only source of cash.
But the ability to supply credit, she wrote, had been considerably weakened by the $325 billion paid out by the major global banks last year on dividends and share buybacks, some $155 billion of which was laid out by the eight largest banks in the US.
Meanwhile, fears are growing that the enormous pile of debt around the world could start to collapse as the economic effects of the coronavirus deepen and widen.
According to the Institute of International Finance, in a report published last November, total global corporate, government, finance sector and household debt had reached $253 trillion, equivalent to 322 percent of global GDP.
The unravelling could start in so-called emerging market economies where there is $72.5 trillion of debt, much of it denominated in US dollars. The growing dollar shortage in international markets, which has seen national currencies fall against the greenback, means obligations on interest and principal payments are rapidly rising.
This increase in the debt burden is occurring as all economies drop into recession, or something worse, and have less cash to meet their commitments.
It is not just emerging market economies that are affected. The Australian dollar, one of the most traded in the world, saw its rate against the US dollar drop to as low as 55 cents last week, compared to just under 70 cents a few months ago.
This means that the debt burden of a company or financial institution that had raised $100 million, when the Australian dollar traded at 70 cents to the US currency, would rise in Australian dollar terms from $A143 million to more than $A180 million when the Australian dollar fell to 55 cents, placing it under enormous strain as revenues drop.
The cash flow crisis is striking at the heart of the major economies as well.
In the UK, the Tory government is considering a plan to take out equity holdings in airlines and other companies because the economic stimulus packages announced so far are not sufficient to prevent collapses.
In the US, the Wall Street Journal has reported that “scores of US companies,” from the aircraft maker Boeing to the telecommunications Verizon, are “furiously lobbying” to be included in the bailout packages being prepared by the Trump administration that could run as high as $2 trillion.
For more than a century, the semi-official religion in the US has been the denunciation of socialism, which Trump had planned to make the centre of his re-election campaign.
Now the universal cry is: the state must intervene; once again billions must be handed to the corporations on an even larger scale than in the crisis of 2008.
The calls will only get louder. According to a Wall Street Journal report yesterday, investors and analysts say the more than 30 percent drop in the share market over the past month is not over, despite extraordinary actions by the Fed involving trillions of dollars.
Summing up the voracious outlook in corporate and financial circles, a representative of the global investment and banking firm State Street, told the Journal: “Market participants need to feel they are backstopped without question.”

A $50 Billion Airline Bailout for Warren Buffett


Why do Republicans want to bail out a top Democrat funder?
March 23, 2020 
Daniel Greenfield
Daniel Greenfield, a Shillman Journalism Fellow at the Freedom Center, is an investigative journalist and writer focusing on the radical Left and Islamic terrorism.
In March, as the Wuhan Flu was taking off in America, the Oracle of Omaha began buying airline stocks. Specifically, one of the wealthiest men in the country increased his stake in Delta Airlines to 11%.
Warren Buffett wasn’t oblivious to the coronavirus. The University of Nebraska Medical Center, not far from the black gated mansion of the billionaire, was on the front lines of fighting the outbreak. Passengers from the Diamond Princess cruise ship were being treated 5 minutes from his house.
What was Warren Buffett thinking when he shoved $45 million more in good money after bad?
Berkshire Hathaway now owns 11% of Delta Airlines, and between 8% and 10% of United Airlines, Southwest Airlines, and American Airlines. When you’re squeezed into a 17-inch airline seat, it’s because a major funder of Democrat political causes is extracting maximum value from his investment.
And now Airlines for America, whose major members include American, Delta, United, and Southwest, along with lesser airlines, want a $50 billion bailout. That includes $25 billion in grants and $25 billion in loans and tax relief. While the airlines warn about an economic catastrophe, Buffett isn’t worried.
The airlines made up 4% of Berkshire Hathaway’s portfolio and amounted to $3.7 billion in losses.
Warren Buffett is no stranger to bailouts. In 2010, he penned a fake folksy New York Times op-ed thanking “Uncle Sam” from his nephew “Warren”. Later that year, he became a key propaganda figure in Obama’s push to raise taxes. By the winter of the year, Obama had placed the Presidential Medal of Freedom around the neck of the man who had fundraised for him and acted as his financial adviser.
As Peter Schweitzer noted, “It was only on September 23 that he became a highly visible player in the drama, investing $5 billion in Goldman Sachs, which was overleveraged and short on cash… Berkshire Hathaway received preferred stock with a 10 percent dividend yield and an attractive option to buy another $5 billion in stock at $115 a share… As he admitted on CNBC at the time, ‘If I didn't think the government was going to act, I wouldn't be doing anything this week.’”
Buffett seems to think that the government will act and bail out the airlines. Again. And this time for a lot more than the $15 billion price tag of the airline bailout that passed after September 11.
By 2009, Berkshire Hathaway had invested $26 billion in eight financial companies, including Goldman Sachs, Wells Fargo, and Bank of America, which benefited from around $100 billion in TARP money.
By 2011, Buffett was buying $5.9 billion in Goldman Sachs stock for $5 billion.
There’s no question that the Democrat billionaire is a very sharp investor. But there’s no reason for taxpayers to keep subsidizing his investments. As small businesses are forced to shut down and millions of people are put out of work, should they really be helping Warren Buffett get even richer?
Just as during the bailout, Buffett is betting that the government is going to back his investment.
If the major airlines were really about to go down, Buffett would be trying to get everything out, instead of getting in deeper. The billionaire is betting that Berkshire Hathaway will emerge in a stronger position after the bailouts and the surge of optimism that will follow the lifting of the coronavirus curfews.
He’s almost certainly right.
But if he wants to profit from the turnaround and the potential takeover of an airline, he should do the heavy lifting on his own. Berkshire Hathaway is sitting on $125 billion in cash. But why cash out his treasury bills when the D.C. swamp will be happy enough to do most of the heavy lifting for him.
Where will those taxpayer-funded profits go?
In 2014, the Oracle of Omaha predicted that Hillary Clinton will win. “I will bet money on it, and I don’t do that easily,” he boasted.
And maxed out his contribution to the Ready for Hillary PAC. He also shoveled money into the DNC.
In this election cycle, he poured $245,000 into the Democratic Congressional Campaign Committee.
Republicans lobbying for an airline bailout are literally fighting to secure taxpayer money that will then be used to fund their political opponents. It’s an insane act of fiscal political suicide.
Beyond political donations, Buffett has spent millions covertly funding abortion activism. Due to his obsessive secrecy, the full scope of his abortion funding is unknown, but the Buffett Foundation donated almost $4 billion to abortion causes, including $674.5 million to Planned Parenthood.
Arguably, the Oracle of Omaha has done the most to promote abortion of anyone in America.
It’s a revelation that clashes with his folksy image and invocation of small-town values. But behind the Garrison Keillor routine, Buffett is just another version of George Soros with an American accent.
That’s not just rhetoric.
At the heart of Soros' power over American politics is the Democracy Alliance, a club of powerful organizations funneling money into transforming this country. The Democracy Alliance's core partners include the NoVo Foundation, run by Buffett’s son and daughter-in-law, and funded by $150 million from the Oracle of Omaha.
NoVo funds hate groups like Van Jones' Color of Change, which plotted to defund the David Horowitz Freedom Center, along with the Rockefeller Family Fund, the Tides Foundation, and the National People’s Action.
That last donation is especially interesting considering NPA’s role in creating the Community Reinvestment Act  which forced banks to dispense mortgages to insolvent borrowers. This, as the Freedom Center’s Discover the Networks notes, “ranks high among the primary causes of the 2008 financial crisis.” That’s both fascinating and disturbing considering Buffett’s links to that crisis.
Buffett avoided the subprime crisis while profiting massively from the resulting disaster.
Putting money in Buffett’s pocket will mean more cash for Biden, it will mean more Democrats in the House and the Senate, more abortions, and more power for George Soros’ Democracy Alliance.
So why are Republicans ready to make concessions to Democrats in exchange for the privilege of electing more Democrats with a Buffett bailout? Even if one were to argue that a bailout of the airline industry may be necessary, why would Republicans lobby to cut their own throats?
When the wall isn’t funded, how can the GOP justify a second billion-dollar bailout of an industry that will then just turn around and cut another 2 inches from the cramped seats of the taxpayers who bailed them out?

CCP Virus Exploding Federal Deficit Even as Comptroller General Warns of ‘Urgent’ Need for Debt Reduction


March 20, 2020 Updated: March 22, 2020
WASHINGTON—There were only rumors of a possible $1 trillion economic stimulus package on March 12 when U.S. Comptroller General Gene Dodaro urgently warned the Senate Budget Committee that federal spending and debt are on an “unsustainable” path.
Dodaro got right to the point at the outset of his testimony:
“I am concerned because our debt-to-gross domestic product (GDP) ratio as of the end of the last fiscal year was 79 percent. That’s the highest it’s been since World War II, when we hit the historic high of 106 percent,” Dodaro said.
“So we are very heavily leveraged in debt at a time when we are going to be facing a steady annual deficit of a trillion dollars a year for as far as the eye can see.”
He was referring to the fact the national debt now exceeds $23 trillion ($122 trillion if unfunded obligations such as those of Social Security and Medicare are included).
That $23 trillion currently equals 109 percent of the 2019 GDP of $21.4 trillion. But interest costs more each year as the national debt goes up and the Government Accountability Office projects those costs to exceed total non-defense discretionary federal spending by 2024, go beyond defense spending the next year, and blow past Medicare in 2042 and Social Security in 2046.
“This is why we believe the current path is unsustainable,” Dodaro said.
Five days later, amid an intensifying worldwide crisis occasioned by the CCP virus, Treasury Secretary Steven Mnuchin confirmed that President Donald Trump wants Congress to pass an economic stimulus package that will cost at least $1 trillion.
“It is a big number. This is a very unique situation in this economy,” said Treasury Secretary Steven Mnuchin. “We put a proposal on the table that would inject $1 trillion into the economy. That is on top of the $300 billion from the IRS deferrals.
“Now let me just say, this is a combination of loans, this a combination of direct checks to individuals, this is a combination of creating liquidity for small businesses.
“You can think of this as business interruption money. The president is determined to put money back into this economy to protect hard-working Americans and small businesses.”
About half of the funds will go to individuals and families based on reported income from 2018, with most of the other half being loans made available to corporations and small businesses primarily for the purpose of keeping payrolls as intact as possible during the crisis.
Details are still being worked out in negotiations between the Trump White House and congressional leaders from both parties.
Asked by a reporter if Congress should be concerned about rising deficits, Mnuchin demurred, saying: “I think Congress right now should be concerned about American workers and small businesses. You know interest rates are incredibly low right now, so there’s very little cost of borrowing this money, and, as I’ve said, in different times, we’ll fix the deficit, but this is not the time to worry about it.”
Even so, the $1 trillion stimulus package raised eyebrows, especially as more details became known. The budget committee has asked the Congressional Budget Office (CBO) for an assessment of the package’s impact on the government’s financial health, according to a senior Senate aide who asked not to be identified.
The conservative Heritage Foundation released an analysis warning that “any action that Congress takes should be targeted, temporary, and linked directly to the coronavirus epidemic in order to address the source of the economic shock, while limiting any political abuse that can develop in a moment of crisis.”
“Unfortunately, the Senate’s coronavirus bill, the Coronavirus Aid, Relief, and Economic Security Act, misses this mark by including special benefits to specific industries that will exceed $200 billion,” it said.
Truth in Accounting President Sheila Weinberg told The Epoch Times that it appears “the federal government is going to cover trillions of dollars of other losses and costs, including those for business interruption, personal income loss, and health care costs.”
“This type of coverage is what insurance companies do, but not at this scale,” Weinberg said.
“The federal government requires insurance companies to have reserves to meet their customers’ benefits. Since the federal government has become a multitrillion-dollar insurance company, it should have reserves to cover the costs of crisis. Instead, the government is $23 trillion in debt (plus another $100 trillion for unfunded Social Security and Medicare benefits).”
The Epoch Times refers to the novel coronavirus, which causes the disease COVID-19, as the CCP virus because the Chinese Communist Party’s coverup and mismanagement allowed the virus to spread throughout China and create a global pandemic.
Contact Mark Tapscott at Mark.Tapscott@epochtimes.nyc




No comments: