Day: September 17, 2017

Johnny Appleseed: Land Speculator, Alcohol Dealer, Capitalist

Jon

Similar to the English legend of Robin Hood, the character Johnny Appleseed has evolved over time into a progressive icon. In the former, the famed outlaw, made an enemy of the government by reclaiming unjust taxes, became a socialist folklore hero who ‘stole from the rich and gave to the poor.’ Johnny Appleseed, an American legend, is depicted as a selfless peripatetic, traveling the country planting apple trees so that nobody would go hungry. He lived an ascetic lifestyle, preached the gospel of Jesus Christ, and refused to hurt any of God’s creatures (one apocryphal tale claims that he angrily threw away his shoe out of guilt for having accidently stepped on a worm).
Some of these fabled characteristics are based in truth. Johnny Appleseed did live well below his financial means, for example, giving people the false impression that he was a poor man. But Johnny Appleseed’s true accomplishments – the successful accumulation of wealth through entrepreneurial speculation and calculated claims to the private property he developed with his apple seeds – have been entirely omitted from the legends taught to schoolchildren. Accurately told, the life of Johnny Appleseed is a capitalist success story.
Johnny Appleseed Brings Alcohol to the Frontier
The legend of Robin Hood was a fiction born out of a different fiction, but the legend of Johnny Appleseed is a fiction born out of a real person. John Chapman was born on September 26, 1774, the son of a Revolutionary War veteran who would later encourage his son to become an orchardist.

This post was published at Ludwig von Mises Institute on Sept 17, 2017.

Sentiment Speaks: Either You Learn From The Events Of The Past Week, Or You Are Hopeless

Jon

Back in mid-July, we called for the market to top within 3 weeks between 2487-2500. And, 3 weeks later, the market topped at 2490SPX within one day of the topping date we expected. And, since we struck that high, the market has followed through in an almost textbook fashion for the entire month of August, as we caught just about every twist and turn during the month.
Coming into the last week of August, we were expecting the market to drop down to support within the 2425-2430SPX region, and then rally back towards the 2465-2475 region, before it set up to drop back down to the 2400SPX region. As we now know, dropped hard and bottomed early that week at 2428SPX, and then rallied back to 2480SPX. When the market topped out at 2480 on September 1st, our expectation was that we would see a drop down to the 2400SPX region next.
While the market dropped 34 points from that level within the next trading day, when it came back up through 2460SPX I posted to all our members that we now have opened the door to the 2500-2510SPX region, rather than an immediate continuation down to the 2400SPX region. The main reason was that when the market did not follow through on our Fibonacci Pinball set up towards 2400SPX and came back up through the 2460SPX region, the market provided us with a strong warning that the downside follow through was much less likely. As of Friday, we have finally struck the 2500SPX region.
As I write my weekly articles about how one should ignore exogenous factors such as news or geo-political events when analyzing the markets, I always get a number of people who will argue with me. They see a single news event coincide with a directional move in the market and are absolutely convinced that the particular news event was the ‘obvious’ cause of that market move. They then extrapolate this experience and believe that news and geo-politics are always what drives the markets.

This post was published at GoldSeek on Monday, 18 September 2017.

Money-Supply Growth Drops Again – Falls to 108-Month Low

Jon

Growth in the supply of US dollars fell again in August, this time to a 108-month low of 4.2 percent. The last time the money supply grew at a smaller rate was during August 2008 – at a rate of 4.1 percent.
The money-supply metric used here – an “Austrian money supply” measure – is the metric developed by Murray Rothbard and Joseph Salerno, and is designed to provide a better measure than M2. The Mises Institute now offers regular updates on this metric and its growth.
The “Austrian” measure of the money supply differs from M2 in that it includes treasury deposits at the Fed (and excludes short time deposits, traveler’s checks, and retail money funds).
M2 growth also slowed in August, falling to 5.3 percent, a 75-month low.

This post was published at Ludwig von Mises Institute on Sept 18, 2017.

Weekly Commentary: Monetary Disorder

Jon

This is a syndicated repost courtesy of Credit Bubble Bulletin . To view original, click here. Reposted with permission.
Global Credit, Bubble and market analysis is turning more interesting.
China August Credit data were out Friday. Total (aggregate) Social Financing jumped to 1.48 TN yuan ($225bn), up from July’s 1.22 TN and above the 1.28 TN estimate. New Loans were reported at a much stronger-than-expected 1.09 TN (estimates 750bn yuan), up from July’s 825bn. New loans expanded 13.2% y-o-y. Through August, Total Social Financing is running 18% above 2016’s record pace. Total system Credit growth (‘social financing’ plus govt. borrowings) appears on track to surpass $4.0 TN. While ‘shadow banking’ has of late been restrained by tighter regulation, household (largely real estate) borrowings remain exceptionally strong.
It was the weaker Chinese economic data that made the headlines this week. Retail sales (up 10.1% y-o-y), industrial production (up 6.0%) and fixed investment (up 7.8%) were all somewhat below estimates. At the same time – and I would argue more importantly – Chinese inflation is running hotter than forecast. Considering the scope of the ongoing Credit expansion, inflationary pressures should come as no surprise.
September 10 – Bloomberg: ‘Inflationary pressure emanating from the factory to the world is proving more resilient than economists have anticipated. China’s producer-price inflation accelerated to 6.3% in August from a year earlier, exceeding all but one of 38 estimates… That data… followed 5.5% readings in the prior three months… The surprise strength gives support for global inflation spanning from metals to fuel and shows the effects of resilient domestic demand and reduced supplies of some commodities.’

This post was published at Wall Street Examiner by Doug Noland ‘ September 16, 2017.

Visualizing America’s Rampant Racial Wealth Inequality

Jon

Even though the United States is on course to become “majority minority” by 2044, Statista’s Niall McCarthy notes that the country still has a huge and growing racial wealth gap.
A new study by Prosperity Now and the Institute for Policy Studies has found that white households in the middle-income quintile own nearly eight times as much wealth as middle-income black earners and ten times as much as middle-income latino earners.
Last year, the same research claimed that if current trends continue, it will take 228 years for the average black family to reach the same level of wealth white families have today. For latino families, it would take 84 years.
Since 1983, black and latino families have seen their real wealth fall considerably from $6,800 and $4,000 to just $1,700 and $2,000 respectively in 2013. Even though white households took a hit during the financial crisis, they still boasted a median wealth of $116,800 in 2013.
The research projects that the gap will widen even further in the years ahead with black household wealth declining 30 percent from today by 2024. The median latino household will see their wealth fall 20 percent while white households will experience a five percent increase by that point.
In addition, while policy-makers are crowing about the fact that aggregate American real incomes are finaly back above 1989 levels, the truth is slightly more awkward… It’s all the 1%…

This post was published at Zero Hedge on Sep 17, 2017.

Algeria Officially Launches Helicopter Money Amid Sliding Oil Revenue, Budget Crisis

Jon

One year ago, the imminent arrival of helicopter money among endless discussions of pervasive lowflation was all the rage within high-finance policy circles. Then, everything changed as if on a dime, and in recent months the dominant topic has been global coordinated tightening – and in some cases even revisions to central bank mandates and the lowering of inflation targets – perhaps as a result of central banks’ realization that monetizing debt by central banks leads to bad outcomes, not to mention global asset bubbles.
But not everywhere.
On Sunday, Algeria’s prime minister unveiled a plan to plug the country’s budget deficit as the the OPEC member state looks to offset lower oil revenue by directly borrowing from the central bank, while avoiding international debt markets. In other words, direct monetization of debt, which bypasses commercial banks as a monetary intermediate, and is better known as “helicopter money.”
According to Bloomberg, the five-year plan presented by Prime Minister Ahmed Ouyahia aims to balance the budget by 2022, and reverse a deficit that ballooned with the plunge in global crude prices, which also cut foreign reserves by nearly half.
“If we turn to external debt, as the IMF suggests, we will need to borrow $20 billion a year to repay the deficit and within four years we will be unable to repay the debt,” Ouyahia said. ‘This is what made the government look at non-traditional financing.’

This post was published at Zero Hedge on Sep 17, 2017.

The Equifax Hack Is The Most Disastrous Data Breach In History Because Now Hackers Have The Credit Information Of 143 Million Americans

Jon

Talk about a nightmare. It is being reported that criminals were able to hack into Equifax and make off with the credit information of 143 million Americans. We are talking about names, Social Security numbers, dates of birth, home addresses and even driver’s license numbers. If this data breach was an earthquake, we would be talking about a magnitude-10.0 on the identity theft scale. We have never seen anything like this before, and to say that this will be ‘disastrous’ for the credit industry would be a massive understatement.
What really disturbed me about this story is that this hack reportedly occurred between ‘mid-May and July of this year’…
Credit monitoring company Equifax has been hit by a high-tech heist that exposed the Social Security numbers and other sensitive information about 143 million Americans. Now the unwitting victims have to worry about the threat of having their identities stolen.
The Atlanta-based company, one of three major U. S. credit bureaus, said Thursday that ‘criminals’ exploited a U. S. website application to access files between mid-May and July of this year.
So why didn’t we learn about this until September?

This post was published at The Economic Collapse Blog on September 17th, 2017.

LIES, LIES & OMG MORE LIES

Jon

‘There are three types of lies – lies, damn lies, and statistics.’ – Benjamin Disraeli
Every month the government apparatchiks at the Bureau of Lies and Scams (BLS) dutifully announces inflation is still running below 2%. Janet Yellen then gives a speech where she notes her concern inflation is too low and she needs to keep interest rates near zero to save humanity from the scourge of too low inflation. I don’t know how I could survive without 2% inflation reducing my purchasing power.
This week they reported year over year inflation of 1.9%. Just right to keep Janet from raising rates and keeping the stock market on track for new record highs. According to our beloved bureaucrats, after they have sliced, diced, massaged and manipulated the data, you’ve experienced annual inflation of 2.1% since 2000. If you believe that, I’ve got a great real estate deal for you in North Korea on the border with South Korea.
‘Lies sound like facts to those who’ve been conditioned to mis-recognize the truth.’ ‘ DaShanne Stokes

This post was published at The Burning Platform on Sept 17, 2017.

Hurricane Equifax: 143 Million Impacted, 35% Loss In Equity Value, Suspicious 135 Strike Price Put Trades On Aug 21

Jon

This is a syndicated repost courtesy of Snake Hole Lounge. To view original, click here. Reposted with permission.
Recent hurricanes Harvey and Irman have caused massive destruction in Texas and Florida, respectively. And then we have Jose which may strike New York City. [Check Ventusky for the forecast map].
But none of these hurricanes have the potential to impact as many people as Hurricane Equifax, the massive breach of 143 million Americans’ personal information (Social Security numbers, credit card numbers, birthdates and other information).
According to the Washington Post, ‘The tale began on July 29, when the company’s security team detected suspicious network traffic associated with the software that ran its U. S. online-dispute portal. After blocking that traffic, the company saw additional ‘suspicious activity’ and took the portal’s software offline.
At this point, Equifax’s retelling grows cloudy. The company said an internal review then ‘discovered’ a flaw in an open-source software package called Apache Struts used in the dispute portal, which it then fixed with a software patch. It subsequently brought the portal back online.

This post was published at Wall Street Examiner by Anthony B Sanders ‘ September 17, 2017.

“Bulls Have Become Completely Desensitized To Risk”

Jon

Authored by Lance Roberts via RealInvestmentAdvice.com,
Review & Update
Two weeks ago, I noted:
‘I have a sneaky suspicion that when I update the Fed Balance Sheet reinvestment analysis next week, shown below, we are going to find a substantial, well-timed, reinvestment by the Central Bank. Wanna bet? Well, here is the updated chart of the 4-week net change to the Fed’s balance sheet. As you can see, reinvestments have, once again, returned to the market in a very ‘timely’ fashion. Of course, since the Fed claims they are not trying to, nor are they influenced by, the markets, this is purely coincidental. (#SarcasmAlert)’

This post was published at Zero Hedge on Sep 17, 2017.

Atlanta Fed’s Q3 Real GDP Forecast Dwindles To 2.2% From 3.0% (NY Fed Nowcast Q3 Forecast Plunges To 1.34%)

Jon

According to the Atlanta Fed, the GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2017 is 2.2 percent on September 15, down from 3.0 percent on September 8. The forecasts of real consumer spending growth and real private fixed investment growth fell from 2.7 percent and 2.6 percent, respectively, to 2.0 percent and 1.4 percent, respectively, after this morning’s retail sales release from the U. S. Census Bureau and this morning’s report on industrial production and capacity utilization from the Federal Reserve Board of Governors.

This post was published at Wall Street Examiner on September 15, 2017.

Holy Moly, Now Wells Fargo Recommends a Credit Freeze in Equifax Hack

Jon

Third largest US bank reaches out to its customers. A mass credit freeze would have a huge impact.
No one knows yet how the Equifax hack – during which Social Security numbers, birth dates, addresses and, ‘in some instances,’ driver’s license numbers of 143 million consumers had been stolen – will wash out for Equifax, or for the other credit bureaus.
But it increasingly looks like a far bigger and broader mess not only for the credit bureaus but for the overall consumer-based US economy whose grease is easy and often instant consumer credit.
People are trying to put a credit freeze on their data at the three major credit bureaus to protect themselves from identity theft. Victims of identity theft get caught in years of a Kafkaesque nightmare where debt collectors hound them for debts incurred in their name by someone else.
A credit freeze is the best protection against identity theft. It has now been recommended by State Attorneys General, the US Government, the biggest mainstream media outlets, and numerous other outfits including from the first moment on – the evening of September 7 when the hack was disclosed – my humble site. In over 400 comments on my three articles (here, here, and here), readers have shared tips and frustrating experiences trying to deal with overloaded websites that crashed, sent people in wrong directions, or failed in other ways to produce results.

This post was published at Wolf Street on Sep 17, 2017.

The Future of Artificial Intelligence, According to Pop Culture

Jon

The unpredictable nature of superintelligent, self-improving machines lends itself quite nicely to the dramatic storylines of movies and books.
It’s a science fiction writer’s dream: if AI becomes smart enough to create more advanced versions of itself, pretty much every outcome is on the table. Machines could empower humanity to become enlightened and virtuous. On the less optimistic side? Machines could instead ruthlessly enslave all of humankind to tickle their own warped sense of satisfaction.
Pop Culture Perspectives
From the plot of movies like The Terminator to The Matrix, pop culture offers up innumerable examples of what could happen from the rise of the machines – and most of them, as you can imagine, steer towards the less optimistic side of the spectrum.
Today’s infographic from BBC Future provides an entertaining take on these scenarios, organized by potential likelihood.

This post was published at GoldSeek on 17 September 2017.

Focus on the Stock Market

Jon

I believe that the vertical bubble phase of the stock market is just beginning. This video will show you why I believe this and includes a survey of various markets including the S&P, Nasdaq, Dow, Russell, Transports, European stock markets and Semi Conductors.


This post was published at GoldSeek on Sunday, 17 September 2017.

Is It Racist? Maryland Officials Dare To Dis-Allow Non-Citizens From Voting

Jon

In the land of the free, shouldn’t any and every person capable of fogging a mirror (or not in some cases) and arriving at a polling station be able to vote for their favorite benefits-provider-in-chief? It appears officials in College Park, Maryland believe not as the city’s town council voted ‘outrageously‘ to not allow non-citizens to vote in local elections.
***
As The Hill reports, the charter amendment – allowing undocumented immigrants, green-card holders, and immigrants with student visas to vote in municipal elections – was thought to have passed on Tuesday.
However, while the council voted in favor of the proposal by a 4-3 margin, a change to the city’s charter in June requires changes receive at least six affirmative votes, the city explained in a press release Friday night.
College Park Mayor Patrick Wojahn shared the update Friday night on Facebook, saying
“It is with a considerable degree of embarrassment and regret that I share this announcement from the city regarding the proposed charter resolution to allow voting by non-citizens in College Park. I accept my fair share of responsibility for not realizing the impact of recent charter amendments on this issue.”

This post was published at Zero Hedge on Sep 16, 2017.

North Korea’s Nuclear Tests Could Trigger “Supervolcano” Eruption

Jon

After North Korea’s latest nuclear test, scientists are worried that more underground explosions in the isolated country’s rocky north could set the stage for a deadly volcanic eruption not unlike the one that NASA fears could be brewing in the Yellowstone caldera.
Following the North’s sixth nuclear test Chinese authorities have stepped up radiation monitoring and even closed part of their border with North Korea as fallout fears have intensified.
And now, as Newsweek reports, China has limited access to a nature reserve on its border with North Korea after a mysterious series of seismic shakes at the rogue nation’s nuclear test site were detected less than 10 minutes after it conducted its latest test, which also triggered a sizable tremor. The severity of the tremors prompted Beijing to close the site over fears that underground detonations by the North Koreans at a facility near Punggye-ri could lead to rockslides, or worse, trigger an eruption of the active “super volcano” Mount Paektu, according to Disclose.tv.

This post was published at Zero Hedge on Sep 16, 2017.

Market Report: Consolidating after recent

Jon

After the spectacular run from the lows of early July, gold and silver took a breather this week. Bullion markets on Comex had become very overbought, so a pause was inevitable, and healthy. In early European trading this morning, gold is down $23 from last Friday’s close at $1325, and silver off 25 cents at $17.71.
Our next chart illustrates how overbought gold had become, with the Managed Money category net longs on Comex (hedge funds) having soared.

This post was published at GoldMoney on September 15, 2017.