|Interpreting market signals: Math versus DD. Spotting what's Next before Opening|
Sunday night Pre-Market Tips: Bank Stress tests and DHS $500k fines suggest D_o_Treas War against foreign contagion ramps up this week
Banks have ramrodded their cannons and fired test salvos. Its time for the real deal.
DHS has threatened $500k fines per junk news stories but the real target is EB-5 holders who qualify with $500k minimum investment accounts.
Expect banks doing business with EB-5 holders to be effected and USA banks to step in as Angels and White Knights. One example is Bank of California.
- Run for cash and safety is expected.
- Foreign accounts possibly liquidated as Congress threatens additional PRC equities suspensions for failures to disclose.
- Volatility as selling increases might be misinterpreted but buying opportunity is arriving: see any and all equities held by PRC EB-5 firms.
- Real Estate is a major target.
- PRC ADRs a major target: think Alibaba.
50 years ago I was a surprise local standout in track. The little kid everyone dissed became a shock.
Decades later that kid survives only due to heart training from the past.
But in between there was another moment with another standout in track. This guy was a true Olympic challenger and V.Pres of a global investment and trading firm. We crossed paths socially one day and briefly had business ties. He had a fallout that resulted from an SEC investigation. I had unique insight due to personal knowledge plus a company he IPO'ed had a (former) CFO who was also a personal friend.
It is only some 20 or so years later that the public learned dotGOV was battling currency and FOREX abuses in those very same years. But privately the drug money was well-known to be flowing. HSBC is famously in the news but details were secret in my own experience. However the dotcom bubble had a bubbly machine connected to it.
All these years later Congressperson ties to the situation are still not revealed which proves that its better to ask forgiveness than permission if you're a Congressperson. Treasury seems to have a confessional booth.
Why the walk down memory lane?
Treasury is about to conduct another financial crackdown and it has its partners all prepared according to reports. While this might seem a new and unrelated crackdown it is a continuation of the older HSBC and FOREX abuses in a new arrangement. This time the dollars are being laundered in plain sight. The players and accounts are now distributed widely rather than concentrated in trading houses. Self-trading and money transfers are now normal. Back then they weren't.
You know the news. You just haven't connected the dots because you don't think about the subject much. Because my father was a Federal Reserve official these topics are my daily bread.
What you know:
- Companies have been reducing debt and CAPEX for 6 months and more.
- Congress warns to expel and de-list PRC companies failing disclosure regulations.
- DHS warns of $500k fines: think EB-5, not penniless immigrants.
- POTUS warns of financial penalties for PRC economic abuses.
- Treasury completes stress tests for banks.
- Even Mother earth is shaking to get attention (maybe).
These mean all the branches of dotGOV and dotCOM are synchronized and ready to act.
You need to be aware and ready.
A dash to cash is about to occur and the SP effect might be called an end to a bubble by reporters unaware of a major equity liquidation by PRC EB-5 and offshore accounts. These accounts are now a tail that wags the dog.
This is the next stage of responding to the PRC contagion.
This will be a buy opportunity after a shake-out.
Expect Blue Chips and Small Caps to be winners.
You should know that banks handling these PRC transactions will be adversely affected.
Highly leveraged businesses and individuals will suffer.
You should expect financial liquidity emergencies requiring outside Angels and White Knights.
You should expect a wave of effects from equities trading to real estate to high growth industries that are darlings of investors: think Alibaba as an offshore case and Amazon as a domestic case.
You should read news critically as these events unfold.
a very short list of REFERENCES
RE: EB-5 visa holders and Honorary Consuls
Trump administration issues notices of $500K fines for immigrants in US illegally
Bank stocks rally after passing latest stress tests By Ciara Linnane
Published: June 28, 2019 10:11 a.m. ET
Deutsche Bank to exit equities trading in radical overhaul...
The new strategy signals a retreat from Deutsche’s global ambitions and its aim to be Europe’s main rival to Goldman Sachs. One year ahead of Deutsche’s 150th anniversary, Mr Sewing is refocusing the lender on its historic foundations — financing German and European corporate clients and domestic retail banking...
The actions “are designed to allow Deutsche to focus on and invest in its core, market-leading businesses of corporate banking, financing, foreign exchange, origination and advisory, private banking and asset management,” the lender said.
Deutsche Bank to Exit Global Equities, Trading Business
German bank will cut 18,000 jobs by 2022 and will focus on serving European companies and retail-banking customers, including wealthy clients
By Jenny Strasburg Updated July 7, 2019 11:56 am ET Deutsche Bank AG moved Sunday to gut its global ambitions as a trading powerhouse...
July 5, 2019 / 9:12 AM Buoyant U.S. stocks at odds with downbeat market signals NEW YORK (Reuters) - Even as record highs this week in the major U.S. stock indexes telegraph confidence on Wall Street, caution abounds in other U.S. markets, where falling bond yields and flailing small-cap stocks indicate investors are torn about where to place bets.... With the muddled market outlook, several market strategists suggest splitting the difference: adding to positions in defensive sectors while looking for opportunities within beaten-up areas of the market, such as small caps...
July 6, 2019 / 7:45 PM China will further open up forex market: regulator BEIJING (Reuters) - China will fend off cross-border capital flow risks and continue to open up its foreign exchange market, the forex regulator said on Sunday. The regulator will deepen forex reform and strengthen a crackdown on forex-related irregularities, the State Administration of Foreign Exchange said in a statement on its website.
Top immigration official says ICE is ready to deport 1 million undocumented immigrants
Jul 7, 2019