US Economy: Tech leads Wall Street sell-off, investors eye slow recovery - "and it will get worse say experts."

The technology-centric Nasdaq led the declines as its heavyweight stocks took a hit including Facebook Inc (FB.O), Apple Inc (AAPL.O), Amazon.com Inc (AMZN.O), Microsoft Inc (MSFT.O) and Google-parent Alphabet Inc (GOOGL.O) which were all down between 4% and 7%.

The five stocks, deemed stay-at-home winners during the coronavirus crisis, also account for roughly a quarter of the S&P 500’s market value and have driven the stock market’s narrow technology-led recovery from the pandemic lows hit in March.

The Philadelphia chip index .SOX and the S&P tech sector .SPLRCT also dropped more than 5% each.

The pullback comes a day after the S&P 500 and the Nasdaq closed at record levels and the Dow came within 1.5% of its February peak, powered by fiscal and monetary support hopes for a swift economic recovery. But some participants said investors had become too optimistic.

Read more at: Tech leads Wall Street sell-off, investors eye slow recovery - Reuters

Wall Street Fata Morgana: Dow soars almost 4% main stock-market indexes turn positive for May on coronavirus vaccine hope

U.S. stocks soared on Monday, erasing May losses, on optimism that the American economy might be percolating again, while the medical community works toward a potential COVID-19 vaccine.

Risk assets also received a boost after Federal Reserve Chairman Jerome Powell on Sunday night struck a more upbeat tone on the U.S.’s growth prospects, while highlighting that the central bank still retained tools to limit the economic downturn.

Note EU-Digest: Wall Street "Fata Morgana" goes in overdrive, as it clamps on to imaginary "positive" news. Stop dreaming. It's time for a reality check folks. The US economy is on life support.

Dow soars almost 4% main stock-market indexes turn positive for May on coronavirus vaccine hope - MarketWatch

China - US trade deal: World stocks pause at record peak as markets assess U.S.-China deal

World stocks inched ahead to a record high on Thursday after the United States and China signed an initial deal to defuse their 18-month trade war, though financial markets were wary as a number of thorny issues remained unresolved.

Read more at:
https://uk.reuters.com/article/us-global-markets/world-stocks-pause-at-record-peak-as-markets-assess-u-s-china-deal-idUKKBN1ZF02X

UN - The US inability to admit reality - by Thierry Meyssan

Decidedly, very little has changed since 11 September 2001. The United States continue to manipulate international public opinion and the tools of the United Nations, no doubt for different reasons, but still with the same contempt for the truth.

In 2001, the representatives of the United States and the United Kingdom, John Negroponte and Stewart Eldon, assured that their two countries had just attacked Afghanistan in legitimate defence after the attacks committed in New York and Washington.

The Secretary of State, Colin Powell, promised to hand the Security Council a complete dossier presenting proof of Afghan responsibility. 16 years later, this document has still not been seen.

n 2003, the same Colin Powell came to explain to the Security Council, during a speech which was relayed by the televisions of the whole world, that Iraq was also implicated in the attacks of 11 September, and that it was preparing new acts of aggression against the United States by means of weapons of mass destruction.

 However, once he had retired from his functions in the US government, General Powell admitted on a TV channel in his own country that the many accusations in his speech were all false [3]. 14 years after this speech, we are still waiting for the United States to apologise to the Security Council.

US methods after 2001 were totally different from any that had preceded them. In 1991, President Bush the Father had made certain that he had international law on his side before he attacked Iraq, having pushed President Saddam Hussein to invade Kuwait and to dig in. He had thus obtained the support of almost all the nations in the world. On the contrary, in 2003, Bush the Son settled for lying and then lying some more. Many States distanced themselves from Washington, and we saw the greatest pacifist demonstrations in History, from Paris to Sydney, from Beijing to Mexico.

In 2012, the UN Department of Political Affairs drew up a project for the total and unconditional surrender of Syria [4]. Its director, US citizen Jeffrey Feltman, ex-Under-Secretary of State for Hillary Clinton, used all the means at his disposal to create the greatest coalition in History and accuse Syria of all manner of crimes, none of which were ever proven.

If the States which possess the Feltman document have decided not to publish it, their intention is simply to preserve the United Nations. It is indeed inacceptable that the might and means of the UNO were used to promote war, when the institution was created in order to preserve peace. Since I am not held to the same obligations as a State, I have published a detailed study of this ignoble document in “Right Before Our Eyes”
.
In 2017, the UNO-OPCW Joint Investigative Mechanism, created at the request of Syria in order to investigate the use of chemical weapons on its territory, became the object of the same struggle which had earlier opposed Hans Blix to Washington. Except that this time, the fronts were reversed. In 2003, the UNO was defending peace. This is no longer the case, since Jeffrey Feltman was reappointed and is still the number 2 of the UNO. This time it’s Russia which is opposing the pro-US international civil servants in the name of the Charter.

For the complete report click here At the UN - US inability to admit reality, by Thierry Meyssan

US Economy: Wall Street Is Suddenly in Love with Trump, now they think he is one of them - but will it last?

What is next?

Few people thought Trump could win, and for Wall Street, being caught backing a losing investment is tantamount to death. Plus, his opponent was actually quite friendly if not downright buddy-buddy with the industry.

There was also the matter of Trump saying things on the trail like: ”hedge-fund guys are getting away with murder” and ”Wall Street has caused tremendous problems for us” and ”I’m not going to let Wall Street get away with murder”.

But after a brief moment of panic, wherein it became clear Donald J. Trump, he of ”grab them by the p---y” and “I could stand in the middle of Fifth Avenue and shoot somebody” fame, would be the next president of the United States of America,

Wall Street quickly adjusted to the new reality. In fact, a lot of people are downright giddy about Trump living in the White House (during the week, anyway).

All the usual Wall Street cronies were happy: “Regulatory overreach probably peaked,” said Robert McTamaney, a former Goldman Sachs partner who helped run the firm’s equities-trading business in Asia until 2011 and now manages his own money. “It’s going to come off the boil, and you can probably cut back on the legal team and compliance.”

The impact of the rapidly changing tide in consumer confidence, though, won't be limited to just Trump and Republicans. Already, we have seen the consequence of falling Democratic voter confidence foster spontaneous, peaceful protests. Should Democrats' moods fall further, those protests will become angrier; and we will see the same divisiveness and and extremism seen recently within the Republican Party.

As mood falls, rising self-interest challenges the cohesiveness of even the strongest organizations.

Throughout the 2016 campaign, one could watch as falling confidence split support between Hillary Clinton and Bernie Sanders. If Democrats' confidence remains low, it would not be at all surprising to see even greater divisions form. Based on what I see, a young, leftward leaning, heretofore unknown leader could easily emerge as the new hope of the party — an anti-Hillary Clinton Democrat, as it were.

While Elizabeth Warren is receiving all the media attention now, if mood stays low, the spotlight will almost certainly move on to a true outsider. For the Democratic Party, the outcome of the 2020 election will rest squarely on the party’s ability to pull together young voters in opposition to the Trump presidency.

While admittedly very early, one can expect anti-Wall Street/anti-capitalism sentiment to play a major part, particularly given Trump’s business pedigree. While economists will likely look at the post-election surge in confidence as a reason to expect strong holiday sales,  don’t count on that.

Rather than reflecting the improving financial condition of American consumer, the latest Gallup figures are expressing a return of hopefulness to Republican voters, offset by a mild decline in optimism among Democrats — a change in the political tide. Nothing, however, has changed in the wallets and pocketbooks of voters.

For Trump, he must now translate the "Evengelical tent revival" resurgence in confidence among Republicans into higher confidence for all Americans.

As rising confidence is the critical input to economic growth, financial prosperity and social cohesion, what happens to Americans’ mood over the next several months will drive the trajectory of the next four years. While many Americans feel better today than they did last week, many, many more need to feel good.

Right now, looking closely at the  Presidential election results one can only ask: "has the Trump election win been a silent coup of Corporate America and the Republican party, or have they been just as surprised as the rest of us"

It seems more likely Wall Street could be in for a big surprise and possibly a total meltdown of the US economy. Only time will tell. 

 EU-Digest

USA: Obama’s Warren Buffett foreign policy - by Derel Chollet

In his August 1 column, “A US retreat that feeds on itself,” Fred Hiatt rehearsed many of the familiar critiques of US President Barack Obama’s foreign policy, suggesting that if only the United States had kept substantial troops in Iraq, put forces into post-Gaddafi Libya, bombed Syria after it used chemical weapons and focused a little less on “nation-building at home,” the US — and the world — would be better off.

The idea that the US has retreated defies reality. Today the US is more engaged, in more places and in more ways, than it was eight years ago. In fact, on the issues that matter most — how and where the country uses military force, how it approaches its enemies and works with its partners, and how it should conceive of its power and exert its leadership — Obama’s mark will be enduring and largely positive. Instead of allowing the consensus for the America’s global leadership to fray, the president has worked to strengthen and sustain it.

That’s because Obama plays a “long game.” The defining element of his global strategy is that it reflects the totality of US interests — foreign and domestic — to project leadership in an era of finite resources and seemingly infinite demands.

Obama’s fundamental challenge has been to implement such a strategy within a debate that has become overwhelmed by manufactured drama and the illusion of silver bullet, black-and-white solutions. For too many critics, the answer is almost always for the US to do more of something and show “strength” by acting “tough,” though usually what that something is remains very vague. And doing more of everything is not a strategy.

Think of it this way: Obama has been like a foreign policy version of Warren Buffett, a proudly pragmatic value investor less concerned with appearances and the whims of the moment, focused instead on making solid investments with an eye to long-term success. The foreign policy debate, on the other hand, tends to be dominated by policy day traders — or flashy real estate developers — whose incentives are the opposite: achieving quick results by making a big splash, getting rewarded with instant judgments and reacting to every blip in the market.

Of course, today’s geopolitical turbulence feels like more than the usual market ups and downs. It is understandable that when looking out at the world, Americans are frustrated, pessimistic and scared. But think back to 2008, with the US economy shedding as many as 500,000 jobs a month and on the cusp of a second Great Depression, the US military was stretched to the breaking point through fighting two wars, and many parts of the world associated the US with militarism, Guantanamo Bay and torture. The picture looks very different today.

History reminds us that the question is not whether the world presents challenges but rather how the US is positioned to deal with them. Considering the extent of today’s global disorder, it is tempting to succumb to a narrative of grievance and fear — sharpening the divisions between “us” and “them,” building walls longer and higher, and lashing out at enemies with force. Or to think it better that, to reduce exposure to such geopolitical risk, the US should divest from its alliances. Despite all the talk of “strength,” what these impulses reflect is a core lack of confidence.

We cannot submit to such pessimism. As Obama’s presidency nears its end, the state of the world is indeed tumultuous and ever changing, but we have good reason to be confident. The United States’ global position is sound.

The US has restored a sense of strategic solvency. Countries look to it for guidance, ideas, support and protection.

It is again admired and inspiring, not just for what it can do abroad but also for its economic vitality and strong society at home. Or as Buffett — who last Monday spoke at a rally in support of Hillary Clinton for president — recently declared in his more folksy way, “The babies being born in America today are the luckiest crop in history.”

When it comes to being in a position to solve problems and give people an opportunity to improve their lives, the US is far better off than it was a decade ago. The question is whether it will continue to make the choices necessary to stay that way.

Read more: Obama’s Warren Buffett foreign policy | GulfNews.com