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  • Daily Digest

    Daily Digest 5/22 – Fed’s U.S. Debt Hoard Is About to Soar, Is A College Degree Worth The Debt?

    by Daily Digest

    Wednesday, May 22, 2019, 8:31 AM


Economy

Moody’s: Illinois one of two states unprepared to weather a recession (Saxplayer00o1)

Moody’s rated the states on revenue volatility, coverage by reserves, financial flexibility and pension risk. The latter is an obvious strain on Illinois, a state with an estimated $133 billion unfunded pension liabilities and $7.36 billion in unpaid bills.

QE May Be Over, But the Fed’s U.S. Debt Hoard Is About to Soar (Saxplayer00o1)

If you thought the Federal Reserve was done with quantitative easing, you might only be half right.

As soon as next year, analysts say the Fed will resume large-scale buying of debt securities — this time just U.S. Treasuries — in amounts that may ultimately exceed its crisis-era purchases. According to an estimate by Wells Fargo & Co., the central bank’s balance sheet will rise past its historic peak as it adds over $2 trillion to its Treasury debt holdings in the next decade.

Is a college degree worth owing thousands in student loans? (Saxplayer00o1)

Factoring in inflation, average in-state tuition and fees at a public school have doubled in the past 20 years, but the median salary for college graduates has only increased 2% during that same time.

Millennials had been good at staying out of bad credit card debt. Not anymore (Saxplayer00o1)

But student debt delinquencies of 90 days-plus also are rising, at 10.9% of aggregated balances in Q1. The total of $1.49 trillion in student loans is second among forms of debt, behind mortgages. The NY Fed describes the student loan delinquencies as being at a high level compared to other forms of debt.

Powell Says Leveraged Lending Isn’t Posing a Crash Threat (Saxplayer00o1)

In a sweeping analysis of leveraged lending Powell delivered a response to critics who argue that the Fed is asleep at the switch as another catastrophe looms. Despite obvious warning signs in these risky business loans, the central bank chairman said, the $1.2 trillion market doesn’t represent a current threat to the financial system.

France Goes on Deal Spree, Thanks to ECB Easy Money (Saxplayer00o1)

The European Central Bank’s efforts to revive growth have spurred a flurry of investment and deal making. One problem is, a bunch of it is happening outside of Europe.

French companies in particular have been aggressive in using the ECB’s easy-money policies to snap up foreign competitors and to expand overseas, fleeing anemic growth and high taxes at home. French corporate indebtedness has risen so quickly it has drawn the eye of wary regulators.

Negative Rates, Designed as a Short-Term Jolt, Have Become an Addiction (Saxplayer00o1)
For five years, European nations have been trying to jump-start their ailing economies with what was supposed to be a radical, short-term remedy—negative interest rates.

Instead, central banks haven’t been able to wean their economies off them. Increasingly, they appear to be a permanent feature of the landscape. No major bank that introduced negative rates during Europe’s debt crisis has turned main policy rates positive again.

A French cop on why French cops will never join the Yellow Vests (thc0655)

A PressTV report of ours captured this sentiment during “Act 20”, on March 31. That was the second weekend when urban protests had been banned outright; last weekend was the first time rural protests (at traffic roundabouts) had been banned in many areas, a fact which was totally ignored by the Mainstream Media but which I made our headline on May 11. Back on March 31 I interviewed a protester who was helping to carry a rather costly banner which read, “Forces of order: you will go down in history, so don’t wait until you are tried in court. Join us.” Alongside the slogan was a picture of the Nuremburg trials of Germans during World War II. However, despite the comparison with Nazis those carrying the banner were entirely sympathetic to cops – they were there to intellectually convince the cops to join their side.

Thanks To Facebook, Your Cellphone Company Is Watching You More Closely Than Ever (lambertad)

Offered to select Facebook partners, the data includes not just technical information about Facebook members’ devices and use of Wi-Fi and cellular networks, but also their past locations, interests, and even their social groups. This data is sourced not just from the company’s main iOS and Android apps, but from Instagram and Messenger as well. The data has been used by Facebook partners to assess their standing against competitors, including customers lost to and won from them, but also for more controversial uses like racially targeted ads.

None Dare Call It Nonsense (GE Christenson)

Yes, wages for most people flatlined, even when adjusted by low-ball inflation statistics since the 1970s. However, income and wealth for the political and financial elite grew rapidly. Central banks over-print and devalue fiat debt-based currency units. Prices rise faster than wages. The rich get richer.

Another SAT Bombshell: College Board adds “Parental Misfortune Score” (satire, Phil D.)

“It’s become clear the old way is biased. Kids from homes that practice math or vocabulary are likely to outperform those who drink malt liquor, watch reality TV, and communicate in obscenities”, said Mainaird. “It’s unfair. Our vision is for a future where all kids get the same SAT scores”.

Gold & Silver

Click to read the PM Daily Market Commentary: 5/21/19

Provided daily by the Peak Prosperity Gold & Silver Group

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

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