By Pam Martens and Russ Martens: July 4, 2018 ~ Happy Independence Day. Or not. Today marks the 242nd anniversary of America adopting the Declaration of Independence and throwing off the yoke of King George III – the tyrant against whom much of our founding document was written. These are among the charges that the crafters of this historic document leveled against the King: “He has refused his Assent to Laws, the most wholesome and necessary for the public good… “He has made Judges dependent on his Will alone, for the tenure of their offices, and the amount and payment of their salaries… “For cutting off our Trade with all parts of the world… “For depriving us in many cases, of the benefits of Trial by Jury…” Now consider where we Americans stand today. Within six months of assuming the most powerful position in the world, President Donald Trump, who … Continue reading →

By Pam Martens and Russ Martens: July 3, 2018 ~ Here’s the thing about stock market bubbles: they can last far longer than even expert analysis suggests they should. But correctly defining a stock market as an unsustainable bubble is still a worthy exercise since it clarifies how much one stands to lose when the bubble does eventually pop. One of the market watchers who is unabashedly calling for a major market correction – potentially in the realm of 60 percent from peak to trough – is John P. Hussman, President of Hussman Investment Trust. In his most recent market commentary, Hussman writes: “Unlike much of the recent bull market, present market conditions reflect not only extreme valuations (including a full syndrome of overvalued, overbought, overbullish features), but also divergence and dispersion in our measures of market internals. It’s that deterioration in market internals that threatens to unleash the beast … Continue reading →

By Pam Martens and Russ Martens: July 2, 2018 ~  Wall Street’s top cop, Securities and Exchange Commission Chair Jay Clayton, will embark on a four-city Town Hall type event with retail investors beginning next Monday, July 9. The cities targeted will be Miami, Washington D.C., Philadelphia and Denver. The SEC says it wants to hear first-hand about retail investors’ experiences with their investment advisers. That announcement came from the SEC on Friday. On Monday of the previous week, Clayton delivered a speech on improving the Wall Street culture at a full day symposium held by the New York Fed  — an institution whose culture has also been deeply compromised by Wall Street. (See Is the New York Fed Too Deeply Conflicted to Regulate Wall Street?) The low point of Clayton’s speech came in the opening minutes when he lavished praise on the scandal-laced tenure of the President of the … Continue reading →

By Pam Martens and Russ Martens: June 29, 2018 ~ The U.S. Federal Reserve, the country’s central bank that is supposed to serve the interests of the nation, gave the largest Wall Street banks a big, irresponsible gift yesterday. The big banks will now be able to spend approximately $170 billion buying back their own stock and paying out increased dividends to shareholders instead of doing what banks are supposed to do: make loans to worthy businesses to stimulate the U.S. economy. But don’t expect to find that critical news on the front page of your local newspaper. The front pages of newspapers across America proved once again today that chaos in the running of the Federal government is dominating news reporting while it continues to relegate to the back pages the alarming risks that are growing again on Wall Street. This raises the question as to whether the chaos … Continue reading →

By Pam Martens and Russ Martens: June 28, 2018 ~ There’s an old maxim on Wall Street that says “the trend is your friend.” It’s sort of like Newton’s first law of motion, frequently expressed as “An object at rest stays at rest and an object in motion stays in motion with the same speed and in the same direction unless acted upon by an unbalanced force.” Today, there is an unusually “unbalanced” factor weighing on everything we previously took for granted about our democracy and our American values. Does it also have its fingers in the U.S. stock market? Yesterday morning at 6:30 a.m. the Dow Jones Industrial Average e-mini futures contract was showing a loss 107 points. That loss continued to grow gradually. By 7:15 a.m. the futures were showing a loss of 122. But that trend turned out not to be your friend. By 8:14 a.m. the … Continue reading →

By Pam Martens and Russ Martens: June 27, 2018 ~  Despite President Donald Trump’s leanings toward authoritarianism, he is likely to learn a hard truth this year and next – that the Federal Reserve can make or break his presidency by delivering up to three different gut punches to the markets, which are very likely to spill over into the economy. And without a good economy, even Trump’s most fervent supporters may begin to doubt his omnipotence. For starters, next Monday the Federal Reserve is scheduled to shrink its purchases of U.S. Treasury securities and Federal agency debt and mortgage-backed securities by another $10 billion a month, from a shrinkage of $30 billion to $40 billion. And by October 1 of this year, the Fed will move from draining $40 billion a month from the markets to draining $50 billion, according to its previously announced schedule. (See chart below.) At … Continue reading →

By Pam Martens and Russ Martens: June 26, 2018 ~ Over the past week, everyone from the New York Times to Mother Jones is writing about the yield curve – a topic previously considered so esoteric by newspaper editors that only an economic nerd of a reporter would dare suggest writing a story about it. The concern today is that the yield curve (a measure of short, intermediate and long-term interest rates) is getting very close to inverting. An inverted yield curve occurs when short rates are higher than longer term rates. Under normal circumstances, an investor should be rewarded with a higher yield for taking greater risk in buying a longer-dated bond since future inflation would erode his purchasing power from the interest payments on the longer bond over time. At Wall Street On Parade, we’ve been calling our readers’ attention to what’s happening with the yield curve since … Continue reading →

By Pam Martens and Russ Martens: June 25, 2018 ~ Southwest Key Programs first gained national media attention when Senator Jeff Merkley of Oregon traveled to Brownsville, Texas on June 3 and attempted to enter one of its Federally-funded facilities to check on the immigrant children who had been forcibly taken from their parents under a Trump administration policy called “zero tolerance.” Southwest Key called the police on Merkley and denied him entry. Under the policy that was fully implemented in early May by the Trump administration, even immigrant parents fleeing violence in Central America, with a previous lawful right to seek an asylum application in the U.S., were being incarcerated and having their children and infants as young as three months old forcibly taken from them. Over 2,000 children currently remain separated from their parents as a result of this policy. After enormous public outcry and medical professionals stepping forward … Continue reading →

By Pam Martens and Russ Martens: June 21, 2018 ~ This past week has seen the worst of an American President in modern history and the best of America’s free press. From MSNBC’s almost non-stop coverage of the child abuse inherent in Trump’s policy to incarcerate children and take infants as young as three months old from their immigrant parents at the U.S. southern border to ProPublica’s release of the stunning tape recording of crying, traumatized children calling out for their “Moma” and “Papa” inside a “tender age” detention center, to searing newspaper editorials and OpEds, it has been a week where we can take courage from the fact that America’s press cannot be bullied into the cult-like submission to Trump that has engulfed so many of the Republican members of Congress. Above and below, we highlight three of the media graphics that have accompanied this invigorated search for America’s soul … Continue reading →

By Pam Martens and Russ Martens: June 21, 2018 ~ Over the past 24 hours, everyone from the Pope to Fox TV producers to foreign leaders like U.K. Prime Minister Theresa May to top corporate CEOs like Apple’s Tim Cook to U.S. airlines (who learned they had unwittingly transported snatched children hundreds of miles away from their parents) spoke out in condemnation of President Donald Trump’s inhumane policy to forcibly remove children and toddlers and babies as young as three months old from their immigrant parents attempting to enter the United States at our southern border. In many of these cases, the parents were attempting to pursue asylum applications after fleeing deadly gang violence in their central American country. The outcry and repulsion of this policy of taking children from their lawful parents, without due process, and incarcerating them in internment camp conditions reached a fever pitch yesterday with longtime … Continue reading →