The Streak Is Over – Dow Closes Lower As Early Euphoria Fades Amid “Fire & Fury”

“Unleash Hell…”
It seemed like a done deal early on as the panic-buying sent stocks soaring to new record highs but some North Korea headlines and Jeff Gundlach’s warnings seemed to turn the market and investors were in tenterhooks into the close to see if VIX-clubbing could keep the Dow winning streak alive…But then Trump dropped the “fire and fury” line and all hell broke loose…VIX >11!!

This post was published at Zero Hedge on Aug 8, 2017.

Investor Warns Stock Market Is Like Yellowstone: ‘It’s Beautiful, But It Has A Volcano Underneath It’

Anyone putting money in the stock market at this point should have their head examined. The fact that the stock market has reached a record high for the ninth day in a row should be enough for any rational person to see that we’re in a bubble of massive proportions. But there’s also the fact that all of the big players in the investment community are backing out of stocks like there’s no tomorrow.
Sovereign wealth funds are pulling their money out of stock markets in developed countries, corporate insiders are selling stocks in their own companies, and infamous investment companies like Goldman Sachs are admitting that there’s a 99% chance that the stock market won’t keep rising like this in the near future. Berkshire Hathaway, the 7th largest company in the S&P 500, is sitting on a $100 billion dollar pile of cash that grows year after year, because as the stock market climbs to new heights, there aren’t many attractive investments left. You can’t buy low and sell high when there are no lows, and that should say a lot about current state of the economy.
The latest damning report on the stock market comes from Barry James, the president of James Advantage Fund. In a recent interview with CNBC he compared the global market to Yellowstone National Park. ‘It’s beautiful, but it has a volcano underneath it.’

This post was published at shtfplan on August 8th, 2017.

Disney Announces It Is Pulling Movies From Netflix; Will Launch Streaming Service

Disney served a big surprise moments ago when it reported reported Q3 revenue of $14.24 bn that missed the average analyst estimate, $14.42, even as Q3 EPS of $1.58, above the $1.55 expected. That was not the surprise: what was is that Bob Iger’s entertainment giant just made what was until recently a simmering war with Netflix, hot when the firm announced it would end its streaming act with Netflix, pulling its new release movies starting in calendar 2019, and instead it would launch it own ESPN direct-to-customer video streaming service in 2018.
The platform which will feature about 10,000 sporting events each year, will have content from the MLB, NHL, MLS, collegiate sports and tennis’ Grand Slam events.
The announcement from Disney, which is now hoping to become more of a streaming company like Netflix, comes at a time when Netflix is spending billions of dollars on content, and is hoping to become more of a programming company like Disney.

From the press release:

This post was published at Zero Hedge on Aug 8, 2017.

Agricultural Work Visas Soar As Farmers Struggle With Labor Shortages Amid Immigration Crackdown

Ask any farmer in California what keeps them up at night and we would guess that nearly all of them would list ‘labor shortages’ and ‘water access’ as their top two concerns. Ironically, despite over 90 million American citizens choosing to sit out of the labor force and California having one of the highest minimum wage rates in the country, farmers in the Golden State struggle every year to find enough labor to keep fruits and vegetables from literally rotting on the vine.
Meanwhile, as the new administration promises to crack down on illegal immigrants, farmers are feeling the labor shortages in 2017 more than ever. As the Wall Street Journal notes today, many farmers have turned to the H-2A agricultural visa program to recruit temporary workers from Mexico but the process is generally described as “bureaucratic, costly and time-consuming.”

This post was published at Zero Hedge on Aug 8, 2017.

Graphic Anatomy of a Stock Market Crash: 1929 stock market crash, dot-com, and Great Recession

The 1929 stock market crash became the benchmark to which all other market crashes have been compared. The following graphs of the crash of 1929 and the Great Depression that followed, the dot-com crash, and the stock market crash during the Great Recession show several interesting similarities in the anatomy of the world’s greatest financial train wrecks. They also show some surprises that run against the way many people think of these most infamous of crashes.

This post was published at GoldSeek on 8 August 2017.

For The First Time Since The Tech Bubble The Market No Longer Rewards “Beating” Companies

With Q2 earnings season rapidly approaching its end, Bank of America points out a curious observation: stocks that beat earnings expectations are not getting “rewarded” with higher prices. This is the first time this has been observed in 17 years – the last time the market seemed oblivious to corporate upside was in 2Q 2000… just before the Tech Bubble burst. As BofA warns, “this could be a warning sign that equity market expectations and positioning more than reflect the good results.”
Adding to peak valuation concerns, BofA’s quant strategist Savita Subramanian also expects full-year EPS growth to decelerate from 8% in 2017 to 5% in 2018, and redundantly adds that “the stock market may not react well to decelerating earnings.” That’s one way of putting it.
Some more details on this notable “market peak” phenomenon:

This post was published at Zero Hedge on Aug 8, 2017.

Major Breakout in Emerging Markets

The Dow Jones Industrial Average has officially broken above 22,000 and, according to Ari Wald at Oppenheimer, “there’s really no warnings to suggest that we’re due for a meaningful reversal lower,” he told Financial Sense Newshour on Saturday.
Even with a possible pullback in the seasonally weak August-September period, Ari says they are still buyers on weakness given the “healthy” action of the market:
“The action we’re seeing is very healthy in nature and the investor mindset should be that this is an intact bull market and I want to be positioned appropriately. Specifically, I want to own pro-cyclical equities that tend to outperform in a rising market environment.”
Ari, who is also a member of Oppenheimer’s Institutional Portfolio Strategy team, says that his favorite areas are financials, technology, and, outside of the US, emerging markets. Of the three, Ari seemed to think emerging markets have the greatest potential to outperform.

This post was published at FinancialSense on 08/07/2017.

The Most Important Chart For Stocks

We have previously shown the chart below on countless occasions, so we are content to see that increasingly more banks are showcasing it as the biggest potential threat to the future of the market’s artificial levitation. Here is BofA’s Martin Mauro explaining why “investors may be well served by locking in some profits in US stocks.”
Central banks turning off the liquidity spigot: Among the most striking market developments in recent years has been the coordinated efforts by the world’s central banks to supply liquidity by purchasing financial assets. Investment Strategist Michael Hartnett points out that since the collapse of Lehman Brothers in 2008, central banks have bought $10.8 trillion in assets, and that liquidity has propelled financial markets all over the world.
That phase, as Citi’s Matt King warned two months ago, is ending.

This post was published at Zero Hedge on Aug 8, 2017.

The Volcker Rule and Strong Independent Oversight Is Required to Save the Public From the Banks

“The sense of responsibility in the financial community for the community as a whole is not small. It is nearly nil. Perhaps this is inherent. In a community where the primary concern is making money, one of the necessary rules is to live and let live. To speak out against madness may be to ruin those who have succumbed to it. So the wise in Wall Street are nearly always silent. The foolish thus have the field to themselves. None rebukes them…
People of privilege will always risk their complete destruction rather than surrender any material part of their advantage. Intellectual myopia, often called stupidity, is no doubt a reason. But the privileged also feel that their privileges, however egregious they may seem to others, are a solemn, basic, God-given right.”
John Kenneth Galbraith
“The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government – a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises.

This post was published at Jesses Crossroads Cafe on 07 AUGUST 2017.

Rand Tumbles After South African President Zuma Survives “No Confidence” Vote

Update: South African president Jacob Zuma speaks after his victory fending off the no-confidence vote: “It’s difficult to defeat The ANC.”
As we detailed earlier, national assembly speaker (and purported replacement) Baleka Mbete’s secret no-confidence vote has failed to oust South African President Zuma.
Speaker of Parliament Baleka Mbete shocked South Africans Monday when she announced her decision to allow the vote to proceed on a secret ballot, which would allow party members to vote against their leader outside the public spotlight.
“I understand and accept that a motion of no confidence in the president is a very important matter, a potent tool toward holding the president to account,” she said at a press briefing Monday in Cape Town. She did not take questions from reporters.

This post was published at Zero Hedge on Aug 8, 2017.

8/8/17: Irish Taxpayers Face a New Nama Bill

Ireland has spent tens of billions to prop up schemes, like Nama and IBRC. These organisations pursued developers with a sole purpose: to bring them down, irrespective of the optimal return strategy from the taxpayers perspective and regardless of optimal recovery strategies for asset recovery. We know as much because we have plenty of evidence – that runs contrary to Nama and IBRC relentless push for secrecy on their assets sales – that value has been destroyed during their workout and asset sales phases. We know as much, because leaders of Nama have gone on the record claiming that developers are, effectively speculators, ‘good for nothing else, but attending Galway races’, and add no value to construction projects.
Now, having demolished experienced developers and their professional teams, having dumped land and development sites into the hands of vulture investors, who have no expertise nor incentives to develop these sites, the State has unrolled a massive subsidy scheme to aid vultures in developing the sites they bought on the State-sponsored firesales.

This post was published at True Economics on August 8, 2017.

Is Inflation an issue or did the Fed Mess Up? Is Inflation an issue or did the Fed Mess Up?

The Fed has been trying to create the illusion that inflation is an issue. The guys from the hard money camp also maintain that inflation is an issue and to a point they are right. Their definition of inflation is an increase in the money supply. TheFed, on the other hand, defines inflation as an increase in prices. The real definition of inflation is an increase in the money supply; rising prices are just the symptom of the disease. This article from mises.org summarises this concept quite succulently
Inflation, therefore, means an increase in the amount of receipts for gold on account of receipts that are not backed by gold yet masquerade as the true representatives of money proper, gold.
The holder of un-backed receipts can now engage in an exchange of nothing for something. As a result of the increase in the amount of receipts (inflation of receipts) we now also have a general increase in prices.
We are not going to spend time dwelling on this point as the crowd has bought the line the Fed has sold them and so the above point is moot. This article will focus on the price factor and not money Supply factor.
In numerous articles published over the last twenty months, we stated that Fed would be playing with fire if they raised interest rates as this economic recovery is based on ‘hot money’. We went on to state that if they raised rates, it would be a temporary ploy to buy them more wiggle room. Yellen recently confirmed that the Fed’s Hawkish bias might be coming to an end. She acknowledged that Inflation was below the Central bank’s target of 2%

This post was published at GoldSeek on 8 August 2017.

Irrational Exuberance Replay: Former Fed Chair Warns Bond Bubble About to Burs

Last week, former Federal Reserve chairman Alan Greenspan issued an emphatic warning during an interview on CNBC’s Squawk Box: Beware, the bond bubble is about to burst. And when it does, it will take stock prices down with it.
The current level of interest rates is abnormally low, and there is only one direction in which they can go, and when they start, it will be rather rapid.’
Greenspan headed the Fed from 1987-2006, so he has some experience in blowing up asset bubbles. His tenure at the central bank featured an extended period of low rates, but nothing compared to what we have today. In fact, Greenspan pointed out that going back to the time of Alexander Hamilton, long-term interest rates have never been as low as they are today.
The former Fed chair stopped short of predicting when the crash will happen, but he emphasized the prolonged period of low interest rates will come to an end, and the bull market in fixed income that has lasted more than three decades will end along with it.

This post was published at Schiffgold on AUGUST 8, 2017.

De-escalation: Canadian Envoy Arrives In North Korea

In the latest, and most tangible sign yet of ongoing attempts to de-escalate the conflict with North Korea, the state-run news agency KCNA reports that a special envoy of Canadian Prime Minister Justin Trudeau arrived in North Korea on Tuesday, according to Yonhap.
Daniel Jean, national security advisor to the prime minister of Canada, and his party arrived in Pyongyang, the Korean Central News Agency (KCNA) said, without elaborating further.
The visit has drawn speculation that the envoy was to discuss the issue of Korean-Canadian pastor Lim Hyeon-soo detained in the reclusive regime. Lim has been held in custody by the North since he entered the reclusive country on a humanitarian mission in January 2015. In December the same year, the North’s highest court sentenced Lim to life in prison, citing his “subversive plots” against the Pyongyang regime.

This post was published at Zero Hedge on Aug 8, 2017.

Russia Says It’s Ready To Cut Their Dependence On The US Dollar – Episode 1352a

The following video was published by X22Report on Aug 8, 2017
UK retail growth slows more than expected. US job opening soar as corporations sales decrease. US credit card debt at an all time high, more people are living on credit to survive. Fannie Freddie are going to be trouble when the downturn in the economy begins . Corporate leverage is at an all time high. Russia is prepared and ready to cut their dependence on the dollar and payment system.

“It Won’t Be Pretty” – One Trader Wonders “What Happens When ‘Analysis Be Damned’ Fails?”

The disconnect between hope and reality has never been so wide.
The exuberant-sounding earnings growth (thanks to depression-like base effects) are not showing up in forward-looking expectations for growth…
But, as former fund manager Richard Breslow notes – for now, forget lucky versus smart. What investors want to be is right rather than wrong.

This post was published at Zero Hedge on Aug 8, 2017.

Speculators Bearish as Dollar Tries to Hold Major Support

FS Insider recently spoke with John Derrick, CFA, President of the Derrick Letter, regarding his outlook on the dollar, the US stock market, and more. Derrick believes there is a good case to be made that we are nearing the end of the dollar’s decline and that the risks of a near-term correction in the US stock market have increased (see Derrick: Retail Investors Buying As Institutions Trim Back for audio).
Dollar Weakness Set to Reverse
The dollar has traded lower over the course of this year, and it’s now approaching an extreme, Derrick noted.
Right after the election, there was a great deal of enthusiasm for President Trump’s agenda. With the expectation of greater economic growth and fiscal stimulus, the dollar rallied strongly as investors anticipated a shift towards tighter Fed policy in response.

This post was published at FinancialSense on 08/07/2017.

Asian Metals Market Update: August-8-2017

The real democratic side of USA is revealed as its senators have made mockery of the elected president by making Trump not able to do anything. Trump has been trying to make the world a peaceful place to live. American politicians bank on war to make a fortune. Investors know that USA is now a leaderless nation. This is the key reason why the US dollar has not gained despite a good US monthly employment numbers. Politically Eurozone is much stable than USA. American policies in Eastern Europe and its bias towards filling Europe with Islamic migrants will only increase physical demand for gold from the region.
American companies are a loss in Russia.

This post was published at GoldSeek on 8 August 2017.