Posted by on December 31, 2016 9:15 pm
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One year ago, when looking at the 20 most popular stories of 2015, we admitted that it was difficult to find a coherent theme of the key events that shook the world, and which you, our readers, found most interesting and notable:

  • 2015 was year in which class warfare in the US approached unprecedented levels with antagonism between races, genders, ethnicities, ideologies, age groups and incomes all approaching peak levels, and spilling over, literally, on the street as the US public was inundated with daily reports of mass shootings, of trigger-happy policemen, of petulant students demanding conformity, of a president demanding the population hand over even more constitutional rights, of a nation torn in the most volatile presidential race yet.
  • it was a year of rising, and in many cases, brutal intraday volatility, of ever more flash crashes across virtually all asset classes, of pain for anyone who was not invested in the five largest companies, and overall a year of change and losses for those hoping the Fed would “have their back” no matter what;
  • it was a year in which the S&P declined for the first time since the financial crisis, as a result of the first Fed rate hike in a decade and concerns about the sustainability of China’s numerous asset bubbles, the devaluation of the Yuan and the viability of China’s numerous insolvent public and private enterprises and banks.
  • it was a year in which the geopolitical situation outside of the U.S. got decidedly worse, with the Syrian global proxy war resulting in the first instance of a NATO nation attacking and taking down a Russian fighter jet in decades, but more importantly, in a historic refugee crisis that will alter the face of Europe for years to come, as well as unleashing a wave of terrorist events which are likely just beginning, as governments across the globe seek to exploit the crisis for their own selfish reasons.
  • In summary, 2015 was a year of confused flux and of dramatic change: change which was largely amorphous and chaotic but which we said would crystallize over 2016, “in unpredictable and, sadly, violent ways.”

It did indeed, because when looking back at the past year, 2016 provided much needed closure to many of the themes and narratives that emerged in 2015, and earlier, most of which played out in the political arena, where for the first time in decades the established status quo was shaken to its core when two completely unexpected events took place, first Brexit, then the election of Donald Trump, setting the stage for a dramatic revulsion from widely all accepted norms and principles.

As we had warned for years, the vast if silent majority, feeling snubbed and neglected by the political oligarchy and the world’s central bankers, decided to take the power back which they did within the confines of the democratic process, sending the establishment reeling, by rejecting years of legacy narratives, first by voting to divorce the UK from Europe, and then to replace decades of a failed, and flawed, political regime in the US with something… different.

It remains to be seen if these changes will be successful and bear fruit, or if they will be a change for the worse. However, the simple reality is that people had enough and wanted change. This, in the words of the established media, was called “populism”, and the transformation process which allowed it to take place was maligned under the umbrella definition of “fake news.” More on that later.

It wasn’t just political upheaval that marked 2016: in the financial realm, markets first were jarred, then hailed the gradual shift in legacy sentiment, as the primary driver behind the global economy morphed from one of central-bank directed monetary policy – 2016 was the year in which $14 trillion in global debt hit record negative yields when central banks seemingly went all in to inject record stimulus into the markets if not so much the economy  – to what many now expect will be a reflation, and fiscal-stimulus driven economy.

On of the biggest questions facing 2017 is whether this transition will actually take place, and how smooth such a handover will be; for now optimism and hope prevail.

2016 also demonstrated how dominant the political narrative has become when it comes to finance and capital markets. For all those lamenting that relentless coverage of politics (which sadly also includes every tweet from Donald Trump: for those who are unaware, we would like to inform you that 2017 will be the year when domestic and foreign policy takes place on Twitter) and why finance appears to have taken a secondary role, and why the political “narrative” has taken a dominant role for financial analysts, the past year showed vividly why that is the case. After all, it was a historic U-turn in conventional wisdom in the early hours of November 9, that sent the S&P soaring, and allowed the US market to close nearly 10% higher on the year from what until two month earlier was shaping up as another wash out in stocks. The reason: the narrative surrounding the Trump victory – a political event – went from cataclysmic to optimistic in the span of mere hours.

And speaking of market performance in the past year, it is delightfully ironic that despite the experts having predicted the outcomes of every key event incorrectly (who can forget the prevailing calls for doom and gloom should Brexit take place or Trump defeat Hillary), the US stock market actually closed almost exactly where consensus said one year ago it would close, or as Bloomberg notes, while they got everything else wrong, the accuracy of US equity strategists predicting the annual gain of 9.5% is unprecedented in Bloomberg data going back to 2000.

How did they get it so right? Simple: central banks openly warned that any selling following watershed political events is no longer acceptable (who can possibly forget the ECB pledging to bailout the market in case of a Brexit). Sure enough, markets took the hint, and after taking 65 days to recover all losses from the August 2015 China devaluation, it took the S&P only 5 days to recover the post-Brexit losses, it took only 16 hours to regain the sharp, limit-down drop after the Trump election, and stunningly, just 9 hours to recover the entire loss from the Italian referendum outcome which, too, was a vote against establishment politics.

The problem with this habituation that “no news can ever again be bad news” is that it is no longer clear what the market may or may not have priced in, absent hope and expectations of central bank intervention to arrest any future selling episodes; central bank intervention which in 2016 hit all time highs and numerically amounted to over $15 trillion in cumulative liquidity injections. However, with a major shift now taking place away from monetary and toward fiscal policy, the “assumption of hope” will surely be tested in 2017.

Another assumption that will be tested in the coming year is whether “China no longer matters” for US markets, something which was certainly not the case last year. Back in 2015, US futures would swoon the moment the PBOC announced even a modest drop in the Yuan. On the other hand, in 2016, US equities could care less what Beijing did, how bad NPLs among Chinese banks rose, how pervasive corporate defaults in China became, or what the future held for China, and its $35 trillion in financial assets. We have a nagging suspicion that whether or not the US manages to avoid a recession in 2017, and the business cycle is now so long in the tooth, the current expansion is will be the third longest in US history on the day of Trump’s inauguration in three weeks.

However, should the most powerful trend of 2016 (and prior years) persist and it most likely will, far fewer hedge funds will be there to trade this “assumption” – 2016 was the year in which active managers saw the biggest outflows in assets under management since the financial crisis, as investors grew so disenchanted with the “2 and 20 model”, they pulled their money out of the underperforming asset class and dumped it into ETFs and other, cheaper alternatives.

Still, while many themes, both in the political and financial realm, did get needed closure, dramatic changes in 2016 persisted, and which will continue to manifest themselves in dramatic, often violent and unexpected ways – from terrorism in Europe, to “populist” upheavals around the developed world, to unprecedented capital flight out of China. Perhaps these non-stop changes is the reason why 2016 was an absolute record year for Zero Hedge: not only did we have our first 100 million page view month, but just two days ago we crossed 3 billion cumulative page views since inception, just over two years after hitting our first 1 billion pageview milestone.

As always, we thank all of our readers for making this website – which has never seen one dollar of outside funding and has never spent one dollar on marketing – a small (or not so small) part of your daily routine.  Which also brings us to another amusing topic: that of fake news, and something we – and others who do not comply with the established narrative – have been accused of. While we find the narrative of fake news laughable, after all every single article in this website is backed by facts and links to outside sources, we find it a dangerous development, and very slippery slope, that the entire developed world – certainly the US with Obama’s recent passage of the “Countering Disinformation And Propaganda Act” into law – is pushing for what is, when stripped of fancy jargon, is internet censorship under the guise of protecting the average person from “dangerous, fake information.” 

Needless to say, Trump should overturn this blatant attack on the First Amendment, and let people decide for themselves what is and isn’t fake news. If anything, it is the conventional, mainstream media, most of which is owned by a handful of corporations with extensive ties to the government, that demonstrated on numerous occasions in 2016 that it is the primary creator and distributor of “fake news.”

In addition to the other themes noted above, we expect the crackdown on free speech to accelerate in the coming year, especially as the following list of Top 20 articles for 2016 reveals, many of the most popular articles in the past year were precisely those which the conventional media would not touch out of fear of repercussions, which in turn allowed the alternative media to find a key entry point, and take significant market share from the established outlets by covering topics which the public relations arm for a certain presidential campaign refused to do, in the process earnings itself the derogatory “fake news” condemnation.

We are grateful that our readers have realized it is incumbent upon them to decide what is, and isn’t “fake news.”

Before we get into the details of what has now become an annual tradition for the last day of the year, those who wish to jog down memory lane, can refresh our most popular articles for every year during our no longer that brief, 7-year existence, starting with 2009 and continuing with 2010, 2011, 2012, 2013, 2014 and 2015.

So without further ado, here are the articles that you, our readers, found to be the most engaging, interesting and popular based on the number of hits, during the past year.

  • In 20th place, with over 713,000 views, was a shocking development from an otherwise quiet Friday afternoon in mid-July, when the world was gripped by news of a Turkish coup attempt, the first in decades, which subsequently crumbled due to its comically underprepared nature, prompting many to speculate that the entire event had been “faked”; the outcome further cemented Erdogan’s role as Turkey’s undisputed, authoritarian ruler. In the months since, Turkey has emerged as a key strategic player in the Middle East, pivoting from a US/NATO sphere of influence to one dominated by Russia and Putin, a flourshing relationship which not even the recent assassination of a Russian ambassador in Ankara appears able to derail.
  • In 19the place, with 731,917 page views, was an article which demonstrated what some dubbed “Scenes From The Apocalypse”, or the destructive impact of Mass Immigration On The Streets Of France. With immigration having rapidly become the one social force with greatest impact and upheaval across Europe as a result of Angela Merkel’s “open door” policy, which in 2015 warmly greeted over 1 million mostly Syrian refugees in Europe, only for this “noble” act to lead to dramatic consequences, including the deadliest terrorist attacks to befall both France and Germany in the past year, we anticipate that the adverse impact of mass refugees piling into Europe will continue, and likely lead to more “surprises” in Europe’s busy political calendar in 2017.
  • In 18th place, read over 760,000 times, was an article which initially brought upon us the ire of the mainstream press, yet which in retorspect proved to be completely accurate. In late October, we reported that due to gross oversampling, polls such as those by Reuters and WaPo were misleading, and that the lead suggested for Hillary Clinton, in many cases as wide as double digits, was invalid. Indeed, this was partially confirmed by ABC/Wapo who, as we noted, “Effectively Admitted To Poll Tampering As Hillary’s “Lead” Shrinks To 2-Points.” Just days later the entire nation discovered precisely just how much poll tampering there was when Donald Trump won the election with a landslide in the Electoral College, and all those “experts” who were relying on polls and predicted that Hillary’s chances of winning the election were as high as 95%, were forced to explain how they could have gotten the outcome so very wrong.
  • In 17th place, with over 761,000 page views, was another article which while widely ignored by the mainstream media for various obvious reasons, fascinated much of America when as part of the Podesta email dump one month before the end of the presidential race, we learned how a top DOJ official Peter Kadzik Was Exposed Colluding With The Clinton Campaign. It was troubling stories like these, and not the “hacking of the elections by the Russians”, that contributed to Hillary’s loss, as the public was for the first time ever granted exclusive front row seats into the corruption and cronyism inherent between the government’s “impartial” agencies and the political uber-class. And those, such as this website, who dared to cover these stories and as a result would never be invited to John Podesta dinners with members of the press, got branded as “fake news” for having the temerity to expose such relationships.
  • Incidentally, speaking of “fake news” and collusion between the mainstream media, the government and its various agencies, in 16 place was our article in which we quoted a Top German Journalist who Admitted that it is the Mainstream Media who is the true source of fake news, stating ont he record that “We All Lie For The CIA.” While few in the mainstream dared to cover his statement, we are delighted that at least 790,000 of our readers learned the truth about how news for “popular consumption” is created. Incidentally, the “fake news” witch hunt is nothing new, and has been around for decades, even long before Operation Mockingbird first brought the world’s attention to just how partial and biased the US press really is.
  • No Top 20 list of 2016 articles would be complete without a story on what was the second biggest surprise of the year, namely the Brexit vote, which while predicted by most as unlikely to happen, not only took place but was won by a substantial majority. Over 800,000 stunned raders and market participants read our report on Brexit, “It’s All Over As “Leave” Wins Brexit Referendum: Markets Everywhere Are Crashing“, and while Brexit indeed won, the market crash promptly turned into a surge as Brexit became a catalyst for even more central bank intervention, leading the BOE to cut rates even more and engage in even more aggressive QE. The ultimate outcome: the UK stock market closed 2016 at all time highs.
  • In 14th spot was another glimpse of the internal workings of the Clinton family courtesy of the Podesta leaks, which led to article which was barely covered by the mainstream and yet more than 853,000 readers were fascinated to read that Teneo head Doug Band Accused Chelsea Of Using Clinton Foundation Money To Pay For Her Wedding. The allegation that the Clinton foundation was abusing donor money was one of the reasons why Pay to Play became such a dominant topic in the last days of the presidential campaign, one not even the Mainstream could evade. Ultimately, the public’s eagerness to see disappointment on the face of Clinton foundation donors is likely one of the reasons why Trump was the unexpected winner of the presidential election.
  • In 13th spot in an article that came out just days after Trump “shockingly” won the election, one which laid out the policy goals the president-elect, among which: “Building That Wall”, End “War On Coal”, Repeal Obamacare, Dismantle Dodd-Frank. Perhaps the reason why over 865,000 readers found this article interesting is that there was so little attention focused on actual policy issues during a presidential campaign that was marked more by mudslinging than any actual constructive discussions between the two candidates. While some have likened Trump’s policies to those envisions by Ronald Reagan, others remain skeptical. For now, the market has given the proposed Trump policies the benefit of the doubt, although that may soon change if some or all of this proposal fail to get the required congressional backing, or if Trump himself backs away from his promises.
  • In 12th spot is a post describing an amusing interlude which followed Trump’s presidential victory, namely when the “Greens” Jill Stein sought a recount in several key battleground states in hopes of swinging the election for Hillary. She failed, when not only did the votes not change, and in some cases actually swung in Trump’s favor, but in other cities, such as Detroit evidence emerged that vote tampering had actually happened to assist Clinton’s campaign as some Republicans had alleged. That however did not matter, as Stein had already collected millions from naive democrats, something we described in “The Mysterious Case Of Jill Stein’s Surging Recount Costs” and which was read by over 865,000 readers. Since much of the raised cash remains unspent, one wonders just how much money in Stein’s bank account is there courtesy of those gullible enough to believe that the Green Party candidate could on her own swing the vote in Hillary’s favor.
  • One of the recurring topics during the presidential campaign was the issue of Hillary Clinton’s ailing health. We first touched upon this topic in August with “Is Something Wrong With Hillary: Bizarre Behavior, Seizure Allegations Raise Doubts About Her Health”, an article that quickly became one of our Top 10 most read post of the year with over 1.41 million reads. While much fo the susbequent reports on the issue were pure speculation, Hillary did not help her cause when one month later in New York, she was caught on camera fainting during a “medical episode” while visiting Ground Zero for a September 11 ceremony, an article which became our 11th most read post of the year. As questions about her health persisted, some speculated that it was Hillary’s questionable health that may have impacted her chances of winning the election.
  • Taking a break from the 2016 election, one of the Top 10 posts of 2016 reminded our readers of the rapidly deteriorating relations between the US police force, those tasked with preserving and protecting the peace, and various members of said population, mostly minorities and African Americans, a conflict which came to a head during 2016, when some declared “open season” for US police officers, many of whom were killed in various assaults across US cities. The reverse was sadly also true as we reported in our “Breakdown Of US Citizens Killed By Cops In 2016“, an article which was read over 1.153 million times. Sadly, the rising violence between police officers and American citizens does not appear to be moderating, and we are afraid we will see much more of this in the coming year.
  • While it is unclear how much of an impact it had, when Wikileaks Announced in late October It was Launching “Phase Three” Of Its Election Coverage, it was read over 1.172 million times, becoming the 9th most popular article of the year, confirming that one of the biggest players of the presidential election was neither Donald nor Hillary but Wikileaks, an organization which the Trump administration has accused of working on behalf of the Kremlin and has helped Trump win the election.  To be sure, many of the revelations gleaned from Wikileaks provided an intimate look inside the corruption and cronyism at the highest levels of US politics, and while one can debate their motives, for better or worse Wikileaks certainly played a major role in the election.
  • One name that made the most frequent appearances among the Top 10 articles of 2016, was that of Clinton’s former campaign manager, John Podesta, and also the person many accuse of being directly responsible for Hillary’s loss as a result of his leaked emails exposing the most unprecedented, and unpleasant, details of the US political process and how it was being corrupted almost on a daily basis by the Clinton clan. Indeed, among the Top 10 we see such articles as Podesta To Mills: “We Are Going To Have To Dump All Those Emails” with 1.182 million page views, “John Podesta’s Best Friend At The DOJ Will Be In Charge Of The DOJ’s Probe Into Huma Abedin Emails” with over 1.228 million reads, and “The Smoking Gun: Cheryl Mills Tells Podesta “We Need To Clean This Up – Obama Has Emails From Her“” which was read on over 1.26 million occasions. It was the mainstream media’s unwillingness to cover the Podesta emails that was the main reason why the legacy press accused most of those who did cover the Podesta leaks as engaging in “fake news.” Instead, the reality is that the Podesta emails revealed a side of American politics never seen before, and showed that far from blaming Comey, or the Russians, Clinton’s loss was the result of her own actions. That said, we doubt Clinton or anyone close to her, will ever take responsibility for her failure to win America’s next president, and the blame game will continue.
  • Rounding out the bottom four posts of the year, was a curious question which emerged when police tried to identify the culprit behind anti-Trump riots across various cities. Indeed, our article asking “Who Is Behind The Riots? Charlotte Police Says 70% Of Arrested Protesters Had Out Of State IDs” was read nearly 1.5 million times. Subsequent revelations only confirmed that it was entities associated with George Soros that were among the organizers and primary sources of funding behind various protests meant to appear spontaneous, yet were anything but. Ultimately, the fact that even Soros was unable to prevent a Trump presidency is one of the few reasons why we have a modicum of hope that things under Trump may be different.
  • The third most read article of 2016, with 1.72 million page views, was a post which “Exposed the Playbook For Rigging Polls Through “Oversamples” courtesy of yet another leaked Podesta email. While it was initially mocked, the final outcome of the election confirmed that indeed the Democrats were not only too reliant on oversamples, but as a result of the fake narrative of Hillary’s lead, many potential voters simply decided not to come out and cast a vote at all due to the rampant hubris in the press that Clinton’s victory was absolutely guaranteed. Had poll manipulation not been such a prevalent phenomenon – and as a reminder virtually every single poll showed Hillary ahead of Trump, with polling “experts” predicting that Clinton’s victory chances were about 95% or more – the outcome of the result could have been vastly different if over confidence in her victory had not been so prevalent.
  • The second most read article of the year, with almost 1.8 million reads, was the stunning last minute revelation that the “FBI Found “Tens Of Thousands Of Emails” Belonging To Huma Abedin On Weiner’s Laptop.” To be sure, the FBI’s “intervention” in the home stretch, when Comey infamously reopened the FBI’s probe into Clinton’s email server only to close it days before the election, was the one event most Democrats said cost Hillary the election; the same FBI which several months earlier cleared Clinton of all wrongdoing despite Comey virtually admitting that no reasonable person who have engaged in the actions that the former SecState did without criminal consequences. To many, the FBI’s last minute intervention was the result of a turf war both within the FBI, and between various US government agencies such as the DOJ. It is unclear what the current state of the FBI’s probe into the Clinton Family foundation is as of this moment.
  • Surprisingly, coming in at the top spot with over 9.4 million reads, was an article that went viral, yet had little (directly) to do with the election, and everything to do with the disenchantment felt by the largest US generation, the Millennials. The article “Harsh Realities Of Life Millennials Need To Understand” resonated with so many perhaps because in addition to all the polarities within US society, that between the baby boomers (and the Gen-X and Yers to a lesser extent), and the Millennials, is shaping up as one of the biggest conflicts over the coming years, as millions of America’s wealthiest are set to retire, while those who have the worst job prospects, with few assets to their name, are poised to work for many decades to come in an economy whose growth path has declined substantially in recent decades. Keep a close eye on this particular generational conflict over the coming year as its fallout could have great consequences for the US economy in every aspect of society, from demographics, to economics, to finance.
  • And while it was not the most popular, or most read post of the year, the one article among the Top 10 we found most disturbing, was the recent news that “Obama Quietly Signs The “Countering Disinformation And Propaganda Act” Into Law,” in the process giving a green light to launch a legal crackdown against any and all distributors of information that the government finds offensive, or not in compliance with the accepted narrative. Meant to serve as a legal basis to shutter any “propaganda” fake news internet portals, it is likely that the government will simply use this to muzzle any website that an unaccountable group of bureaucrats deems to be responsible for stirring up populism through the red herring that is “fake news.” While we are hopeful that the Trump administration will undo this law in the coming year, we sadly have our doubts.

With all that behind us, what is in store for 2017?

We don’t know: as frequent and not so frequent readers are aware, we do not pretend to be able to predict the future and we don’t try despite endless allegations that we constantly predict the collapse of everything: we leave the predicting to the “smartest people in the room” who year after year have been dead wrong, and never more so than in 2016, a year that may have destroyed the reputation of the conventional media and the professional “polling” and “strategist” class for ever. We merely observe, try to find what is unexpected, entertaining, amusing, surprising or grotesque in an increasingly sad world, and then write about it.

We do know, however, that after $15 trillion in liquidity has been conjured out of thin air by the world’s central banks, and the tens of trillions of credit money created (and misallocated) by China – a country which was the world’s growth dynamo for the past three decades and which is now rapidly slowing down – the entire world is floating on an ocean of excess money, which for one more year has succeeded in masking just how ugly the truth beneath the calm surface is. Now, with the Fed hiking and as the global growth dynamics shifts from monetary to fiscal policy, as the liquidity tide starts to come out, those swimming naked will finally be exposed, especially if as we expect, the handoff from monetary to fiscal policy is far more volatile than what the market currently prices in. The question we have: how far will the tide be allowed to recede before central banks step in again?

We are confident, however, this in the end it will be the very final backstoppers of the status quo regime, the central banking emperors of the New Normal, who will eventually be revealed as fully naked. When that happens and what happens then is anyone’s guess. But, as we have promised – and delivered – every year for the past eight, we will be there to document every aspect of it.

Finally, and as always, we wish all our readers the best of luck in 2017, with much success in trading and every other avenue of life; we bid farewell to 2016 with our traditional and unwavering year-end promise: Zero Hedge will be there each and every day – on most occasions doing so with a cynical smile – helping readers expose, unravel and comprehend the fallacy, fiction, fraud and farce that the system is reduced to (ab)using each and every day just to keep the grand tragicomedy going for at least one more day.

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