Talk about a hangover. The world’s got $247 trillion of debt hanging over its collective head.
If there’s a broken link anywhere along the chain of global connection, or if a big debt can’t be serviced, or rolled over, or there’s a default, there’s one thing I know for sure… Contagion will be swift, and stocks will throw up their gains quickly.
Don’t look now, but we’re getting to a breaking point thanks to escalating trade wars, emerging markets debts that have to be rolled over this year, and the fact that China’s stock market is already in the tank.
Yesterday, I covered the shots across the bow from both the U.S. and China in the growing trade war. Today, I’m going to take a deep dive into both parties’ next moves and how the markets would inevitably react.
With the mid-term elections coming up in November, it looks like the Chinese are cleverly exerting pressure directly on the President and the Republican Party.
In a deft political move, the Chinese are targeting U.S. products coming out of “Red” states. Specifically, they are going after products made or grown in counties that voted for Donald Trump for President.
That’s putting pressure on Trump supporters, who are now at odds over losing income and jobs and still believing in the President’s agenda and politics.
And that’s not the only curveball China will be lobbing at the U.S.
The name of this publication is Wall Street Insights & Indictments for a reason.
It’s a platform for calling out the trash generated by Wall Street or government money-grubbers that should be taken to the garbage heap.
Here’s a prime example of what I mean.
Timothy Geithner, the former President of the Federal Reserve Bank of New York and former Secretary of the Treasury, went from bailing out giant predatory banks, to pretending to chastise them, to becoming President of Warburg Pincus – a New York investment firm that owns a private equity fund that owns Mariner Finance, a predatory lending heap.
What Mariner does (and why) tells us more about Timothy Geithner than any statement he released as Treasury Secretary.
This past Tuesday, Shah made one of his regular appearances on Varney & Co… But this time was different.
When Charles Payne asked about an oil stock he heard Shah was watching closely, Shah couldn’t help but answer, even though it gave watchers a strong hint about a trade he recommended to his elite circle of followers less than a month ago.
In fact, last Friday he instructed his followers to grab enormous gains on part of the position… And they still have a long way left to profit.
Facebook Inc. (NasdaqGS:FB)’s stock tumbled 21% in March when revelations surfaced that political analytics firm Cambridge Analytica, which helped guide President Donald Trump’s 2016 presidential campaign, paid for data on 87 million Facebook users without their consent.
But after a strong showing by founder and CEO Mark Zuckerberg in front of Congress to address selling of users’ data in breach of a 2012 consent decree, Facebook’s stock ran right back up to make new all-time highs at $203.55.
Now, in a 747-page document released to Congress last Friday, Facebook admitted giving dozens of companies special access to user data after telling Congress it restricted personal information to outsiders in 2015.
That should be the mantra of investors in junk bonds and leveraged loans, especially in ETF products.
If it isn’t, it will be when the next downturn hits the rapidly expanding high-yield bond and loan universe.
And, while a shellacking won’t be pretty for investors who directly own high-yield paper, it’ll be downright ugly for investors who think they’re safer piling into high-yielding junk bond and leveraged loan ETF products.
Two weeks ago, we told you about “Legal Marijuana’s Biggest Day Yet,” when the Canadian Senate passed a bill earlier this month legalizing the use of recreational marijuana, becoming the second nation aside from Uruguay to do so.
This news was huge. Not only did legalization open the doors for Canadians to spend up to $4.34 billion on legal cannabis products in 2019, which could propel cannabis companies’ stock prices to extraordinary highs, it also preceded a huge event that occurred just this past Monday:
The FDA approved the first cannabis-based drug on June 25, 2018.
This drug, commissioned by GW Pharmaceuticals plc (NasdaqGM:GWPH), called Epidiolex, is a twice-daily oral treatment used for patients with severe epilepsy.
Now, keep in mind, these cannabis-based drugs have nothing to do with the stuff people smoke or vape to get high. They have nothing to do with the recreational legalization in Canada, California, or any other state or country that will legalize recreational marijuana in the future. These drugs are non-“high” methods of treatment. In other words, patients do not experience any of the psychedelic properties that come with recreational marijuana. These drugs utilize the numerous medical benefits that come from the plant.
This industry for the clean, medical use of marijuana properties is a $1.112 trillion market, and Epidiolex’s approval is what will set the tone for the industry’s next steps.
The growing trend of investing based on ESG (Environmental, Social, and Governance) issues has created a dangerous problem. That trend has started a new movement of CEOs advancing their personal positions on ESG issues, supposedly on shareholders’ behalf.
Investors now tend to vote with their consciences by buying shares of companies that “do no evil,” or produce goods and services they believe meet ESG standards. On the flipside, they have the power to sell shares of companies whose management, products, or profitability they find distasteful.
To meet the increasing demand for company leaders to make their politics public, more and more CEOs are coming out in “support of” or “condemning” issues they have no real stake in.
CEOs advocating personal ESG opinions or advancing their political agendas on company time (especially while employing company assets in the process) is inappropriate and unwarranted. Worse, public company managers using company platforms to advance their opinions and politics is dividing shareholders (and the public at large) on political, social, and environmental issues.