Chicken Wing Spot Prices Collapse 30% As NFL Protests Take Their Toll

Back in November, shortly after Trump ignited a war with the NFL over player protests of the National Anthem, Papa John’s insisted that their sales were getting crushed by a backlash from fans who decided to boycott games (we covered it here: Papa John’s Pulls NFL Ads Due To “Negative Consumer Sentiment”). That said, the complaint from Papa John’s was seemingly discredited as a convenient excuse for poor earnings the very next day when Pizza Hut said they had seen no impact from the NFL protests.
Of course, with all of the noise of seasonality, weather and random accounting games played by CFO’s, it’s almost impossible to know if, or by how much, declining NFL viewership actually impacted Papa John’s earnings…any conclusions would be ambiguous at best.

This post was published at Zero Hedge on Dec 14, 2017.

The Flattening US ‘Yield Curve’? NIRP Refugees Did it

Sez Fitch & Yellen
US Treasury securities are doing something that is worrying a lot of folks, including Fed Chair Janet Yellen: While short-term yields are rising in line with the Fed’s hikes of its target range for the federal funds rate, longer-term yield have done the opposite: they’ve been declining. This has flattened the ‘yield curve’ to a level not seen since before the Financial Crisis.
This chart shows the yield curve of today’s yields (red line) across the maturity spectrum against the yields of exactly a year ago, after the rate hike at the time. Note how short-term yields on the left have risen in line with the rate hikes, while toward the right of the chart, long-term yields have fallen:

This post was published at Wolf Street on Dec 14, 2017.

California Moves One Step Closer To “Mileage Tax”; Could Require Tracking Your Cell Phone Movements

Just a few months after implementing a massive 60% hike in gasoline taxes, raising them from $0.297 per gallon to $0.417, the state of California is now one step closer to implementing a brand new tax that would charge drivers for each mile driven.
As a quick example of how shockingly misguided such a piece of legislation would be, the logical conclusion here is that poor people who have been forced out of cities like San Francisco, Los Angeles and San Diego due to rising rents would now be forced to incur yet another massive tax for simply commuting into city centers to do their jobs…in essence, in many cases, it would serve as a regressive tax on the poorest families…
So how did we get here? It all started back in 2014 when California passed Senate Bill 1077 calling for a mileage tax. The bill kicked off the California Road Charge Pilot Program which sought to design and test various strategies for implementing a mileage tax.

This post was published at Zero Hedge on Dec 14, 2017.

Nobel Laureate ‘Discovers’ Cause Of Opioid Crisis: Complete Economic Destruction Of The “White Working Class”

For several decades now the American Midwest has suffered from unprecedented economic decay courtesy of a persistent outsourcing of manufacturing jobs in the automotive and steel industries, among others. As we’ve noted frequently, that economic decay has resulted in a devastating surge in opioid overdoses that claim the lives of 100s of people each year.
Of course, many attribute Trump’s staggering victories in states like Michigan, Wisconsin, Ohio and Pennsylvania to his efforts to tap into the frustration of the dispossessed Midwest masses by promising a rebirth of the manufacturing economy that once provided them a solid middle-class lifestyle.
That said, no economic crisis is truly “discovered” until an Ivy League, Nobel-prize-winning economist says it is. As such, we present to you the intriguing findings of Nobel Laureate Angus Deaton who said he was “looking for something else” when he noticed a staggering increase in white mortality rates for people aged 50-54. Per Market Watch:
That was the case with landmark research undertaken by Nobel Prize winning economist Angus Deaton. The Princeton economist, working with his wife Anne Case, stumbled on the fact that mortality rates were rising for working-age white Americans since 1999.

This post was published at Zero Hedge on Dec 14, 2017.

Strap Yourself In – We Are About To See Some Big Moves In Metals

First published on Wed am Dec 13 on SeekingAlpha:
Recent price action
The last week has seen the metals and miners drop down into support regions. As I write this, we are sitting just over major support for most of the charts I follow.
Whereas the GDX likely provides the cleanest picture of the market potential right now, I will be providing you guidance about the GDX in my analysis below. And, while I maintain a strong bullish bias for 2018, the action we see in the coming weeks will tell us when we can begin to take a more immediate bullish perspective.
Anecdotal and other sentiment indications
The whipsaw continues. Most in the complex don’t know whether they are coming or going right now. One day we go up, another day we go down. And, many have become quite bearish again, with many even calling for lows below those seen in 2015.
My last article on metals, which was about whether the metals market is truly manipulated, certainly generated some heated debate. And, anyone who has an opinion about the issue usually has a very emotional perspective on the issue, which is often on display in the comment section.

This post was published at GoldSeek on 14 December 2017.

Kolanovic Unveils His 2018 Outlook: The “Frogs Are Almost Boiled” So Start Hedging

Barely two months after JPMorgan’s Marko Kolanovic previewed the next financial crisis, which he dubbed the “Great Liquidity Crisis”, and which would be catalyzed by the following liquidity disrupting elements:
Decreased AUM of strategies that buy value assets Tail risk of private assets Increased AUM of strategies that sell on ‘autopilot’ Liquidity-provision trends Miscalculation of portfolio risk Valuation excesses … the quant wizard is back in a more conventional form, this time summarizing JPM’s 2018 outlook for equities, volatility and tail risk.
Starting at the top, it may seem otherwise paradoxical – although in the new normal nothing surprises any more – that JPM which holds a near apocalyptic long-term forecast for the world in a derivative context, is also the bank with the highest 2018 S&P target among its bank peers. Here’s Kolanovic:

This post was published at Zero Hedge on Dec 14, 2017.

Yamada: Market Technicals Strong Though Record Margin Debt Spells Trouble

There’s no denying that 2017 has been a good year for investors, with most major asset classes showing gains for the year.
This time on Financial Sense Newshour, we spoke with Louise Yamada of LY Advisors about current conditions and whether she sees any signs of a market top or concerning developments.
Are We on Track for Longest Recovery?
Everything looks to be in alignment and going in one direction, and we’re already in the ninth year of this current bull market.
The cumulative advance-decline line has been confirming the rally, Yamada noted. It has been hitting new highs along with the major indexes.
Minimal Signs of Stress
On the Dow, there were some prior concerns because the Transports had been lagging the Industrials, but last week they experienced a strong breakout.
If you look at the Nasdaq, it’s behavior looks just like the Dow, consisting of a stepping stone pattern with higher lows and higher highs.

This post was published at FinancialSense on 12/14/2017.

Omarosa Says She Has A “Profound Story” To Tell About The Trump Administration

After reportedly setting off alarms in the White House after trying to enter the residence after she’d been sacked by Chief of Staff John Kelly, Omarosa Manigault Newman is threatening to go nuclear. In an interview with Good Morning America’s Michael Strahan, Manigault Newman said there were a lot of things she was ‘very unhappy with’ during her almost 12 months in the White House.
“I have to be very careful about how I answer this but there were a lot of things that I observed during the last year that I was very unhappy with, that I was very uncomfortable with, things that I observed, that I heard, that I listened to,” she said.
After spending the entire interview denying reports about her rumored feud with Kelly and the involvement of the Secret Service in her removal from the White Wing, Manigault Newman abruptly switched gears, turning suddenly critical of her former colleagues.


This post was published at Zero Hedge on Dec 14, 2017.

Stocks, Yield Curve Slammed After China Hike, Draghi Taper, & Tax Tumult

Did Senators Lee and Rubio (and Hatch) just go full “Leeroy Jenkins”?
A surprise China rate hike (and disappointing retail sales) sparked weakness in Chinese stocks…
Mario Draghi managed to talk the Euro and Bund yields lower (despite attemptting to raise inflation forecasts)…
Since the FOMC meeting, Bonds and Bullion are well bid as stocks and the dollar sink…

This post was published at Zero Hedge on Dec 14, 2017.

Robots Purge Homeless From San Francisco Sidewalks

As the homeless crisis on America’s West Coast forces many cities to the financial brink, one innovative animal shelter in San Francisco is using a low cost, high-tech robot security guard to shoo away the homeless outside its facilities, the San Francisco Business Times reported.
The San Francisco branch of the SPCA (the Society for the Prevention of Cruelty to Animals) contracted Knightscope to provide a k5 robot (the same model which in July commited suicide at a mall fountain) for securing the outdoor spaces of the animal shelter. Knightscope’s business model allows the SPCA to rent the robot for around $7 an hour, which is about $3 less than the minimum wage in California. According to San Francisco Business Times, the robot was deployed as a ‘way to try dealing with the growing number of needles, car break-ins and crime that seemed to emanate from nearby tent encampments of homeless people.


This post was published at Zero Hedge on Dec 14, 2017.

Canada Home Values Hit ‘First Quarterly Decline since Q1 2009’ as Household Debt Binge Hits New High

How exposed are over-indebted household to rising interest rates?
Household debt in Canada rose to a new record of C$2.11 trillion in the third quarter 2017, up 5.2% from a year ago and up 10.7% from two years ago, Statistics Canada said on Thursday in its quarterly report on national balance sheets. Mortgages accounted for 65.6% of the total. Canada’s infamous household-debt-to-disposable income ratio, one of the highest in the world, rose to a breath-taking record of 173.3%.
The ratio means that households, on average, owed C$173.3 for every dollar of after-tax income earned. This chart shows how the indebtedness in relationship to after-tax income has soared since 2001, when Canada’s housing boom took off in earnest:

This post was published at Wolf Street on Dec 14, 2017.

Bonds Versus Economists: Reality & The Echo Chamber

As part of its effort to stress its own self-importance, the Federal Reserve conducts a survey of the Primary Dealer members through its New York branch. A written questionnaire is sent out to each bank in advance of every monetary policy meeting. The purpose is for monetary policymakers to make sure that there aren’t any big surprises, that the market, or, in this case, orthodox Economists working for one part of the market, is seeing things consistent with how the Fed wants them to.
In September 2013, the Primary Dealer Survey questions included a few pertaining to the then ongoing ‘taper tantrum’ roiling markets around the world. It was ‘reflation’ #2 and like the others, both the one before and the one after, it came on rather quickly and harshly. On the issue of benchmark interest rates, in the form of the UST 10s, the Primary Dealers all saw interest rates rising still further into the foreseeable future.
Of those surveyed, 65% believed that the 10-year yield would be above 3% by the end of 2014; more than three-quarters, 78%, thought the same for the end of 2015, including 15% who were expecting the 10s to get above 4.50% compared to just 6% who guessed, correctly, 2.01% to 2.50%.

This post was published at Zero Hedge on Dec 14, 2017.

Dear Janet Yellen: Here Is Your Own Watchdog Warning About Financial Stability Risks In “Red And Orange”

In the most interesting exchange during Janet Yellen’s final news conference, CNBC’s seemingly flustered Steve Liesman asked Janet Yelen a question which in other times would have led to his loss of FOMC access privileges: “Every day it seems the stock market goes up triple digits on the Dow Jones: is it now, or will it soon become a worry for the central bank that valuations are this high?”
Yellen’s response was predictable, colorfully so in fact.
Of course, the stock market has gone up a great deal this year. And we have in recent months characterized the general level of asset valuations as elevated. What that reflects is simply the assessment that looking at price-earnings ratios and comparable metrics for other assets other than equities, we see ratios that are in the high end of historical ranges. And so that’s worth pointing out. But economists are not great at knowing what appropriate valuations are, we don’t have the terrific record. And the fact that those valuations are high doesn’t mean that they’re necessarily overvalued.


This post was published at Zero Hedge on Dec 14, 2017.

ECB Keeps Rates Unchanged, Sees Current Policy Stance “Contributing To Favorable Liquidity Conditions”

As expected, there was little surprise in the ECB monetary policy decision, which kept all three key ECB rates unchanged, and which announced that rates will “remain at their present levels for an extended period of time, and well past the horizon of the net asset purchases.”
As it unveiled before, QE will run at 30BN per month from January 2018 until the end of September ‘or beyond, if necessary, and in case until the Governing Council sees a sustained adjustment in the path of inflation consistent with its inflation aim.’ The ECB also noted it can extend QE size or duration if needed.
The central bank repeated it will reinvest maturing debt for extended period after QE, and that the “reinvestment will continue for as long as necessary, will help deliver appropriate stance” and “will contribute both to favourable liquidity conditions and to an appropriate monetary policy stance.”
The market reaction to the statement which was completely in line with expectations, was modest, with the EURUSD hardly even moving on the news.
Full statement below

Monetary policy decisions At today’s meeting the Governing Council of the ECB decided that the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.40% respectively. The Governing Council expects the key ECB interest rates to remain at their present levels for an extended period of time, and well past the horizon of the net asset purchases.

This post was published at Zero Hedge on Dec 14, 2017.

UK Stagflation Risk As Inflation Hits 3.1% and House Prices Fall

UK Stagflation Risk As Inflation Hits 3.1% and House Prices Fall
– UK inflation hits 3.1%, highest in nearly six years
– UK earnings flat – households are still suffering falling real wages
– Stagflation risk as food and drink prices jumped 4.1% in 12 months
– UK house prices fall two-months in a row, down 0.5% in October
– Real stagflation risk now, inflation high and growth slowing
– Savings continue to be eaten by inflation
***
It was just two years ago that Mark Carney was writing his fourth letter to the British Chancellor, explaining why the country was in a deflationary slump. Even then households were feeling the pinch, despite what officials reported.
Since then Brits have become increasingly vindicated as inflation figures have begun to show what they have all known for some time – prices and the cost of living is on the rise.
Now Mark Carney is forced to write a different type of letter to the Chancellor, one where he will have to explain why inflation is above target at 3.1%. The jump to over 3% in the year to November is the fastest paced increase seen in nearly six years.

This post was published at Gold Core on December 13, 2017.

Fed’s Janet Yellen: Stock Market Bubble Not Seen as Major Risk Factor

The outgoing Chair of the Federal Reserve, Janet Yellen, held her last press conference yesterday following the Federal Open Market Committee’s decision to hike the Feds Fund rate by one-quarter percentage point, bringing its target range to 1-1/4 to 1-1/2 percent.
Given the growing reports from market watchers that the stock market has entered the bubble stage and could pose a serious threat to the health of the economy should the bubble burst, CNBC’s Steve Liesman asked Yellen during the press conference if there are ‘concerns at the Fed about current market valuations.’
Yellen gave a response which may doom her from a respected place in history. She stated:
‘So let me start Steve with the stock market generally. Of course the stock market has gone up a great deal this year and we have in recent months characterized the general level of asset valuations as elevated. What that reflects is simply the assessment that looking at price-earnings ratios and comparable metrics for other assets other than equities we see ratios that are in the high end of historical ranges. And so that’s worth pointing out.
‘But economists are not great at knowing what appropriate valuations are. We don’t have a terrific record. And the fact that those valuations are high doesn’t mean that they’re necessarily overvalued.

This post was published at Wall Street On Parade on December 14, 2017.

Inflation: An X-Ray View of the Components

e is a table showing the annualized change in Headline and Core CPI, not seasonally adjusted, for each of the past six months. Also included are the eight components of Headline CPI and a separate entry for Energy, which is a collection of sub-indexes in Housing and Transportation.
We can make some inferences about how inflation is impacting our personal expenses depending on our relative exposure to the individual components. Some of us have higher transportation costs, others medical costs, etc.
Listen to Inflation Spike at Current Valuations Could Be Ugly, Says Nevins
A conspicuous feature in the year-over-year table is the volatility in energy, significantly a result of gasoline prices, which is also reflected in Transportation.

This post was published at FinancialSense on 12/14/2017.