Impeach Trump? No, Abolish the Presidency

‘Teachers used to tell schools kids that anyone can be president. This is like saying anyone can go to Hell. It’s not an inspiration; it’s a threat.’
-Lew Rockwell
In the first month of 2017, to properly kick off a new year of bread and circuses, taxpayers shelled out (involuntarily, of course) $100 million for a massive party for the new president.
That’s right. This year’s inauguration cost roughly $200 million, half of which came from private donations. The other half? ‘Federal, state and local governments,’ said the press.
AKA the taxpayer. AKA the productive individuals of the private sector.
99.999999% of those taxpayers who footed the bill for such an extravagant event didn’t even get to sniff the wine – they weren’t in attendance. It began, after all, on an early Friday morning. Most of them were, to the career sponge’s satiation, at work, ensuring the federal government can keep washing its white elephants.

This post was published at Laissez Faire on May 31, 2017.

Why Do Half-Measures Work for Markets, But Not for Socialism?

Socialists have attempted many times to put their ideology into action. Socialism has been applied in the Soviet Union, Cuba, China (before Deng), North Korea, and by many other less-famous regimes.
In each case, the result has been economic impoverishment and political authoritarianism.
But the die-hard socialists refuse to give up. “Don’t judge communism based on these results, ” we’re told. “Socialism has simply never really been tried.”
Socialism Doesn’t Work Unless It’s Pure Socialism Indeed, in a recent back-and-forth between John Stossel and Noam Chomsky, Chomsky denied that the Venezuelan regime is socialist at all:
I never described Chavez’s state capitalist government as ‘socialist’ or even hinted at such an absurdity. It was quite remote from socialism. Private capitalism remained … Capitalists were free to undermine the economy in all sorts of ways, like massive export of capital.

This post was published at Ludwig von Mises Institute on May 31, 2017.

Face Off : Stocks Vs. Bonds & The Economic Outlook

Authored by 720Global’s Michael Lebowitz, via RealInvestmentAdvice.com,
There is a healthy debate between those who work in fixed-income markets and those in the equity markets about who is better at assessing markets. The skepticism of bond guys and gals seems to help them identify turning points. The optimism of equity pros lends to catching the full run of a rally. As an ex-bond trader, I have a hunch but refuse to risk offending our equity-oriented clients by disclosing it. In all seriousness, both professions require similar skill sets to determine an asset’s fair value with the appropriate acknowledgement of inherent risks. More often than not, bond traders and stock traders are on the same page with regard to the economic outlook. However, when they disagree, it is important to take notice.
We created the Trump Range Chart a few months ago to easily track a number of asset classes, gauge the durability of post-election market moves and monitor divergences. In the May 23, 2017 update to that chart, we noted that some indicators such as the Treasury yield curve, regressed to levels observed prior to the election. At the same time, many of the popular equity indexes continue to power ahead to new record highs. The bond market seems to be telling us that the probabilities of the reflation trade have dropped considerably. Meanwhile, the stock market appears to remain convinced that the prospects for growth and reflation are alive and well. Can they both be right?
Given our opinions on the severe economic headwinds facing economic growth and steep equity valuations, we believe this divergence poses a potential warning for equity holders. Accordingly, we thought it appropriate to provide a few graphs to demonstrate the ‘smarter’ guys are not on board the growth and reflation train.
The graph below shows that the U. S. Treasury 2-year/10-year curve which, having gapped almost 75 basis points wider following the election, has reverted back to pre-election levels. Alongside the yield curve is the S&P 500, which continues reaching new highs since the election. The election date in this graph, and all graphs that follow, is highlighted with the vertical dashed line.

This post was published at Zero Hedge on May 31, 2017.

Are You Wasting Your Time with This Weird Indicator?

This is a syndicated repost courtesy of The Daily Reckoning. To view original, click here. Reposted with permission.
Everyone went gaga over Dow 20,000. The financial media had a field day when the Dow crossed the magical 20,000 mark on a cold morning back in February.
But the Dow teased investors countless times before finally making the leap. The financial press was already whipped into a frenzy by December, only to have to wait two agonizing months for the breakout.
‘Does that mean it’s time to bet against the market?’ we asked back in December 2016.
Just look at that bullish headline. Barron’s was bulled up on stocks again. The party hats were on order. If we were smart, we’d bet against the bulls, right?
I don’t think so.
Look, there are tons of dumb market sentiment indicators out there. But there’s one in particular that folks take way too seriously: the magazine cover indicator.

This post was published at Wall Street Examiner on May 31, 2017.

RBC: “The Entire World Is Long Tech, Short Energy, And Now It Gets Interesting”

With stocks suddenly looking quite shaky after today’s various data misses and bank revenue warning, here is a timely warning from RBC’s head of cross asset strategy, Charlie McElligott, who warns that the “best is behind us” theme remains intact with data, both ‘hard’ and ‘soft’ – kind fading from highs, driving curves flatter, and with the same ‘stalling’ is playing-out globally as well, some of the most concentrated trades are suddenly at risk.
But with volatility perhaps set to make a return, the RBC analysts has some good news: “here is where it gets interesting”, and presents some ways to trade what the inevitable unwind of the trade where the “entire world is long tech, short energy.”
From RBC’s Charlie McElligott
HOW WE GOT HERE / WHERE WE’RE GOING
The status-quo is AGAIN being perpetuated week-to-date (USTs bid / curves bull-flattening, $/Y dipping potentially on account of the massive and painful ‘PBoC engineered squeeze’ in Chinese Yuan shorts, crude fading, ‘Growth’ and ‘Defensives’ leading within equities while ‘Value’ / cyclicals and ‘Size’ / small caps are clubbed – all while S&P remains unbreakable due to ‘goldilocks’ easy conditions with lower rates and USD).

This post was published at Zero Hedge on May 31, 2017.

RIPPLE Crypto-Currency Up 20% Today….. It’s The Wild West Out There

After the crypto-currency, Ripple, fell 12% yesterday, it surged over 20% in trading today. Folks, it’s the Wild West out there in crypto-currency land. I have been spending some time looking into these crypto-currencies because there seems to be a great deal of mystery behind them. And I like looking into and solving mysteries.
Of course, the rapid increase in price has sparked some interest, but very few realize just how much energy and capital it takes to produce one Bitcoin today. Actually, I was quite surprised.
I want my readers to know that I will be doing some research and writing some articles and Reports on these crypto-currencies (along with Gold & Silver) as I believe we are going to be seeing a lot more about them as well as rising interest in the markets going forward.

This post was published at SRSrocco Report on MAY 31, 2017.

MAY 31/GOLD RISES $9.55 BUT SILVER IS DOWN 5 CENTS/AMT STANDING FOR GOLD AT THE COMEX: 19.95 TONNES OF GOLD WITH OVER 30,000 EFP’S ISSUED IN GOLD DELAYING GOLD DELIVERIES/ GOLD OPEN INTEREST DROP…

GOLD: $1272.35 up $9.55
Silver: $17.37 down 5 cent(s)
Closing access prices:
Gold $1269.00
silver: $17.33
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
SHANGHAI GOLD FIX: FIRST FIX 10 15 PM EST (2:15 SHANGHAI LOCAL TIME)
SECOND FIX: 2:15 AM EST (6:15 SHANGHAI LOCAL TIME)
SHANGHAI FIRST GOLD FIX: $1266.03 DOLLARS PER OZ
NY PRICE OF GOLD AT EXACT SAME TIME: 1260.95
PREMIUM FIRST FIX: $5.08
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
SECOND SHANGHAI GOLD FIX: $1273.84
NY GOLD PRICE AT THE EXACT SAME TIME: 1261.30
Premium of Shanghai 2nd fix/NY:$12.54

This post was published at Harvey Organ Blog on May 31, 2017.

Banks Tumble After BofA, JPM Warn Revenue Will Be Down As Much As 15%

The collapse in volatility is finally trickling up to the big banks.
Moments ago, JPM CFO Marianne Lake speaking at a Deutsche Bank conference in New York, warned that contrary to expectations for an ongoing rebound in revenue and profits, the bank’s second quarter revenue has been 15% lower from a year ago. And while she said that US economic figures are “solid, not stellar”, she blamed the same thing that has been the nightmare of daytraders everywhere: collapsing volatility.
From the newswires
JPMORGAN 2Q MARKET REVENUE HAS BEEN DOWN ABOUT 15 PERCENT FROM YEAR EARLIER, CFO SAYS JPMORGAN CFO SAYS MARKET REVENUE LOWER ON LOWER VOLATILITY THAN YEAR EARLIER JPMORGAN CFO: LOW RATES, LOW VOLATILITY HAVE LEAD TO LOW CLIENT FLOWS JPMORGAN CFO: DOESN’T SEE REASON 2Q TREND WOULD CHANGE IN JUNE

This post was published at Zero Hedge on May 31, 2017.

Assume the Brace Position

My friend and British investor extraordinaire Jim Mellon, who made a large amount of money traveling the world doing real estate, is now focused on thinking about and investing in life extension and its derivatives. But he’s also worried about what happens when a lot of people live longer and how we pay for it. He shares my concern about the demographic bubble that we are already in becoming even worse as we live longer than we expected. Further, he points out the same thing I have about the massive move into passive investing and how it is dangerously turning into a bubble in its own right.
In place of passive investing, which he calls ‘a sort of pass the parcel game for investment morons,’ Jim suggests we focus our attention and money on ‘Juvenescence’-style investments – that being the title of his about-to-be-released book on investing in the age of longevity. Why not, he says, ‘benefit from the very things that will keep you alive to an age that would have been regarded as science fiction just one short generation ago’?

This post was published at Mauldin Economics on MAY 31, 2017.

Brick-and-Mortar Retail Meltdown Has a Busy Month

After years of asset stripping by private equity firms and hedge funds. This morning, luxury handbag retailer Michael Kors Holdings, which had had stellar sales through 2014, revealed in its Q4 earnings report that it would close up to 125 retail stores and take a $125 million charge, to save $60 million this fiscal year.
Sales plunged 11.3% year-over-year in Q4, and the company lost $27 million, or 17 cents a share. It doused investors with a gloomy outlook for its fiscal year 2018, with revenues expected to drop over 5% to $4.25 billion, and with same-store sales plunging ‘in the high-single digit range.’
The company was dogged by heavy promotions, a ‘difficult retail environment,’ and a ‘product and store experience’ that didn’t ‘sufficiently engage and excite consumers,’ CEO John Idol said. So the company needs to enhance the store experience ‘to deepen consumer desire and demand for our products.’
Despite a ‘new $1 billion stock repurchase program’ – funded with the money the company is losing, so to speak – share plunged 8.5%.

This post was published at Wolf Street on May 31, 2017.

Pending Home Sales Crash Most In 3 Years, Hit By “Double Whammy” Of Price, Inventory

Signed contracts in April tumbled 5.4% YoY (NSA). This is the biggest drop in pending home sales since August 2014 and comes on the back of last week’s disappointing housing ‘recovery’ data as perhaps Fed- and Trump-driven mortgage-rate rises have finally hit the American ‘pocketbook’.
This is the second monthly drop in a row (-1.3% MoM) and comes with downward revisions for the last few months.

This post was published at Zero Hedge on May 31, 2017.