November 7: Daily Contrarian Reads

Brick-and-Mortar Meltdown Is Sinking Commercial Property Prices

Commercial real estate prices soared relentlessly for years after the Financial Crisis, to such a degree that the Fed has been publicly fretting about them. Why? Because US financial institutions hold nearly $4 trillion of commercial real estate loans. But the boom in most CRE sectors is over. The Green Street Property Price Index – which measures values across five major property sectors – had soared 107% from May 2009 to the plateau that began late last year, and 27% from the peak of the totally crazy prior bubble that ended with such spectacular fireworks. But it has now turned around, dragged down by a plunge in prices for retail space.

GOP Tax Plan----Robbing Peter To Pay Apple Tax Act

For I am that unfortunate species that Republicans want to pretend doesn’t exist: the middle-class schlub who will not feel tax relief, but tax pain, even as they attempt to re-cut the tax pie so that corporations get a 43 percent tax reduction (from 35 percent to 20 percent), while my top tax rate stays the same (25 percent) and I lose the lion’s share of my itemized deductions. Meaning my taxes, unlike most corporations, are going up, even as I’ll be getting taxed at a higher rate than Apple—whose 2016 revenue was $215.6 billion.

Why The Hong Kong Fireworks Matter

Still, Zhou’s sudden essay that appeared on Saturday, the day after some real fireworks in Hong Kong money, should stir some serious global reflection. To start with, this isn’t the first time China’s central bank chief has made a cryptic warning of sorts. In early 2014, he was especially blunt about the situation then facing China.

Trump: A Year One Review

To reiterate: by this point, the Trumpocalypse – which one might visualize as a combination of nuclear winter, global warming, and the opening up of the mouth of Hell – should already have been well underway. And yet nothing of the kind has happened. Why not? Could it be that the hysterical response of the “mainstream” media to Trump’s victory at the polls was way out proportion to the actual threat? Is it possible that a national security Establishment with real policy differences with the President sought to poison his presidency from the beginning?

What Could Possibly Go Wrong?!

Everybody and his uncle, and his uncle’s mother’s uncle, believes that the stock markets will be zooming to new record highs this week, and probably so, because it is the time of year to fatten up, just as the Thanksgiving turkeys are happily fattening up — prior to their mass slaughter.

Red Ponzi Tottering-----Shadow Banking System Growth Screeches to A Halt

China’s shadow banking sector, estimated by some analysts to be worth 122.8 trillion yuan ($18.5 trillion), stopped growing in the first half of the year as issuance of wealth management products declined, according to Moody’s Investors Service. For the first time since 2012, China’s gross domestic product grew faster than shadow banking assets in the six-month period, Moody’s said in a statement Monday. Following last month’s Communist Party Congress, further regulation will continue to rein in shadow banking and address some of the key systemic imbalances, Moody’s said.

Mind The Credit Spreads---Risk Isn't Dead, It's Just Sleeping

There is an old Monty Python skit about a parrot whose lack of movement and refusal to respond to prodding leads to an intense debate over what state it is in. Is it just sleeping, as the proprietor of the shop that sold it insists? A very tired parrot taking a really deep rest?

How The Establishment Is Learning To Love McCarthyism

The New York Times has finally detected some modern-day McCarthyism, but not in the anti-Russia hysteria that the newspaper has fueled for several years amid the smearing of American skeptics as “useful idiots” and the like. No, the Times editors are accusing a Long Island Republican of McCarthyism for linking his Democratic rival to “New York City special interest groups.” As the Times laments, “It’s the old guilt by association.”

Moneyball Economics Update---Consumers Are Again Faltering

Major bellwether industries for the retail consumer are showing signs of distress. The upcoming holiday season will help… but most consumers are already maxed out. They can’t NOT buy their friends and family holiday presents. After that… who knows when they’ll make those big purchases again.

The GOP's Stunning Fiscal Hypocrisy---Tax Cuts, Yes, But Don't Take The Loophole Goodies

So after all that ruckus over debt ceilings, sequesters, bipartisan entitlement-reform committees and fiscal cliffs, it turns out that debt/deficit hawkery was just an oppositional pose, a way to regain power and unleash the cut-cut-cuts. As the increasingly lonely libertarian Rep. Justin Amash (R-Mich.) tweeted, “2011-2016: Principles! 2017: End justifies the means.”

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