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Economic Outlook

Canada’s Hunt for Taxes – Trudeau’s Destruction of the Canadian Economy

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Posted by Martin Armstrong - Armstrong Economics

on Friday, 15 September 2017 06:48

Trudeau-JustinThe Canadian Prime Minister Justin Trudeau is doing his best to send Canada into the Dark Age. He is clearly a Marxist and has targeted small business which creates 70% of all employment. He said “I want to be clear,” at the Liberal party’s recent caucus gathering in Kelowna. “People who make $50,000 a year should not pay higher taxes than people who make $250,000 a year.”

These people who always seek to run governments have ZERO real world experience and totally fail to understand the economy no less how society functions. They believe that they can just decree some law and everything will function to the desires.

Trudeau has been defending the his outrageous tax increase on small business that will impose double taxation as owners will no longer be able to pay themselves dividends, neither will they be able to sprinkle income among family members, or holding certain investments — such as real estate — through a corporation.

The Hunt for Taxes in Canada is in full swing. This is only part of the economic decline we see coming into play starting in 2018.

....also from Martin:

Trying to Save the Euro from Total Disaster



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Economic Outlook

Got a Bully Problem? Send in a Bully

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Posted by Frank Holmes - US Global Investors

on Thursday, 31 August 2017 06:06

1Here’s a news flash for you: Donald Trump is controversial and caustic. He says exactly what’s on his mind, no matter how incendiary, and he’s not afraid to make enemies, even with members of his party. “Bully” is a word many people use to describe the 45th U.S. president.

The thing is, no one who voted for Trump—I think it’s safe to say—didn’t already know this about him. His being a bully is baked right into his DNA, and he expertly honed this persona during his stint as the tough-as-nails host of NBC’s The Apprentice.

Remember when Trump received flak a few weeks back for retweeting a gif of himself 



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Economic Outlook

U.S. economic growth hits 3% rate in second quarter

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Posted by MarketWatch

on Wednesday, 30 August 2017 07:43

MW-FG274 nerd o 20170221133048 MGWASHINGTON (MarketWatch) — The U.S. economic rebound in the second quarter was stronger than initially reported, as a lift to consumer spending and business investment led to the strongest growth in more than two years.

Gross domestic product rose at 3% rate from April to June, up from an initial 2.6% reading, the Commerce Department said Wednesday.

Economists surveyed by MarketWatch expected a smaller upward revision in second-quarter GDP to a 2.8% rate.

The economy picked up from a 1.2% rate in the first quarter. A slow first quarter followed by an improved second quarter also occurred in two of the past three years. Economists say that the most recent data suggest the U.S. is on track to maintain a 3%-plus clip in the third quarter.

The last time the U.S. economy had two quarters above 3% was in 2014.

President Donald Trump is relying on growth above 3% to generate enough revenue for the government to pay for tax cuts and more infrastructure spending.

....also analysis and charts from ZeroHedge:

US Second Quarter GDP Revised Sharply Higher To 3.0%, Best In Two Years



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Economic Outlook

Here’s how the next recession begins

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Posted by Simon Black - Sovereign Man

on Tuesday, 22 August 2017 12:24

7b33d51709dbedc590c38fc9cb37fe98In 1886 there were only 38 states in the United States. 

Electric power was still cutting edge technology that few people had ever seen. 

The Statue of Liberty hadn’t even been dedicated yet. 

But it was that year that a man named Richard Sears founded a small retail company in Minneapolis, Minnesota that would grow into a retail juggernaut. 

Sears was truly the Amazon of its day. 

Even in the late 1800s the company was able to deliver just about any product you wanted right to your doorstep. 

This was no small feat considering the first delivery truck wouldn’t be invented until 1895. There was no transportation infrastructure. And two-thirds of the population lived in remote rural areas. 

Yet despite those challenges, Sears was still able to put any product you wanted in your hands. 



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Economic Outlook

Obamacare Finally Repealed

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Posted by Martin Armstrong - Armstrong Economicsn

on Thursday, 10 August 2017 07:26

TAX-CUTThe American Health Care Act (HR 1628) finally passed by the House yesterday reducing taxes on the American people by over $1 trillion. The bill abolishes the most abusive taxes imposed by Obama and the Democrat party back in 2010 known as Obamacare. The Democrats helped the insurance companies and burdened the youth trying to force them to pay for insurance they did not need to get insurance companies to cover people they would not.

Obama as a presidential candidate back in 2008, had promised repeatedly that he would NOT raise any tax on any American earning less than $250,000 per year. That was an outright lie. As always, they claim they will only tax the rich, but it never ends up that way.

In KING v. BURWELL, 576 US –  (2015), the Supreme Court upheld Obamacare claiming it was a tax. There was no constitutional power for Congress to punish someone who did not buy health insurance. The only way to uphold such a power was under the taxing powers. Justice Scalia wrote in his dessenting opinion:

The Act that Congresspassed provides that every individual “shall” maintain insurance or else pay a “penalty.” 26 U. S. C. §5000A. This Court, however, saw that the Commerce Clause does not authorize a federal mandate to buy health insurance. So it rewrote the mandate-cum-penalty as a tax. 

With the repeal of Obamacare, tens of millions of middle income Americans will get tax relief from Obamacare’s long list of tax hikes that have oppressed so many. The taxes that will be abolished are:

  1. The Obamacare Individual Mandate Tax which hits 8 million Americans each year.
  2. The Obamacare Employer Mandate Tax Together with repeal of the Individual Mandate Tax repeal this is a $270 billion tax cut.
  3. Obamacare’s HSA withdrawal tax. This is a $100 million tax cut.
  4. Obamacare’s 10% excise tax on small businesses with indoor tanning services. This is a $600 million tax cut.
  5. The Obamacare health insurance tax. This is a $145 billion tax cut.
  6. The Obamacare 3.8% surtax on investment income. This is a $172 billion tax cut.
  7. The Obamacare medical device tax. This is a $20 billion tax cut.
  8. The Obamacare tax on prescription medicine. This is a $28 billion tax cut.
  9. Obamacare’s Medicine Cabinet Tax which hits 20 million Americans with Health Savings Accounts and 30 million Americans with Flexible Spending Accounts. This is a $6 billion tax cut.
  10. Obamacare’s Flexible Spending Account tax on 30 million Americans. This is a $20 billion tax cut.
  11. Obamacare’s Chronic Care Tax on 10 million Americans with high out of pocket medical expenses. This is a $126 billion tax cut.
  12. The Obamacare tax on retiree prescription drug coverage. This is a $2 billion tax cut.

...also from Martin:

French Elections – A Sell Signal Long-term for the EU Regardless of Who Wins



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Economic Outlook

Car Sales Have A Long Way To Fall

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Posted by John Rubino - DollarCollapse.com

on Wednesday, 05 July 2017 05:26

The past decade’s historically low interest rates convinced millions of Americans to buy cars they could only afford with hyper-cheap credit. This made auto sales one of the drivers of the recovery, but it also left far too many people with underwater “car mortgages” that will limit their spending on other things and prevent them from buying their next car until sometime in the 2020s. 

Like all artificial (that is, credit-driven) booms, this had to end eventually, and it’s looking like now is the time: 

U.S. Auto Makers Post Sharp Sales Decline in June

(Wall Street Journal) – Detroit’s car companies reported steep sales declines in June, capping a bumpy first half of the year for the U.S. auto industry and setting a bleak tone for the summer selling season.

The reports, released Monday, come as analysts expect overall auto sales to have fallen more than 2% in June compared with the prior year, according to JD Power. The firm said the industry’s selling pace hit its lowest point since 2014 over the first six months of 2017, and traffic at dealerships—measured by retail sales—fell to a five-year nadir in June.

Edmunds.com, a consumer-research company, said buyers are stretching more than ever to afford cars and trucks that are growing increasingly more expensive due to a barrage of safety gear and connectivity options. The firm estimates the average auto-loan length reached a high of 69.3 months in June, with the average amount of financing reaching $30,945, up $631 from May.

General Motors Co. GM +2.91% said U.S. sales fell 5% to 243,155 vehicles, while Ford Motor Co. F +4.07% said sales totaled 227,979 vehicles, down 5.1% from a year earlier, and Fiat Chrysler Automobiles N.V. posted a 7% decline to 187,348 vehicles.

The following charts show a steady rise in car sales and inventories from their 2009 low to a 2015-2016 peak. If they’ve shifted into a cyclical decline the bottom, based on history, is a long way down. 

Auto-inventories-July-17



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Economic Outlook

Proof That This Economic recovery narrative is false

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Posted by Sol Palha - Tactical Investor

on Friday, 23 June 2017 10:21

A hallucination is a fact, not an error; what is erroneous is a judgment based upon it.

Bertrand Russell

The financial media has provided reams of data trying to lay out the case that this economic recovery is real. Many of the statistics provided do indeed support the theme that the outlook is improving. One must, however, keep these two facts in mind when looking at the data:

  • The Fed poured huge amounts of money into this market. Minus the money, this so-called economic recovery would have never come to pass

  • Due to the low-interest rate environment, corporation borrowed money on the cheap and poured billions into share buybacks since the crash of 2009.

Hence, while some of these statistics paint a rosy picture, the outlook is far from rosy as two key leading economic indicators have failed to confirm this recovery from the onset.

The Baltic Dry index is trading 92% below its all-time high. Now imagine the Dow was in the same position and the press instead of calling it a crash, made the assertion that we were in the midst of a raging bull market. You would think they were insane. Well, the same analogy applies today; this index clearly indicates that there is no recovery on a global basis and that hot money is creating the illusion of one. Remove this excess cash from the system, and the economy together with the stock market will collapse.

This once highly effective leading economic indicator appears to no longer work as the playing field has been altered. However, it is working, as it is indicating this recovery is nothing but a sham. It can longer be used as a tool to gauge the direction of the stock market or the strength of the economy because as stated hot money has altered the landscape.

Baltic Dry Index 2017

Copper another leading economic indicator also clearly illustrates that this recovery is a sham.



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