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  • Stock Markets Hyper-Risky 2

    The US stock markets enjoyed an extraordinary surge in 2017, shattering all kinds of records. This was fueled by hopes for big tax cuts soon since Republicans regained control of the US government. But such relentless rallying has catapulted complacency, euphoria, and valuations to dangerous bull-slaying extremes. This has left today’s beloved and lofty stock markets hyper-risky, with serious selloffs looming large.
    History proves that stock markets are forever cyclical, no trend lasts forever. Great bulls and bears alike eventually run their courses and give up their ghosts. Sooner or later every secular trend yields to extreme sentiment peaking, then the markets inevitably reverse. Popular greed late in bulls, and fear late in bears, ultimately hits unsustainable climaxes. All near-term buyers or sellers are sucked in, killing the trend.
    This mighty stock bull born way back in March 2009 has proven exceptional in countless ways. As of mid-December, the flagship S&P 500 broad-market stock index (SPX) has powered 297.6% higher over 8.8 years! Investors take this for granted, but it’s far from normal. That makes this bull the third-largest and second-longest in US stock-market history. And the superior bull specimens vividly highlight market cyclicality.
    The SPX’s biggest and longest bull on record soared 417% higher between October 1990 and March 2000. After it peaked in epic bubble-grade euphoria, the SPX soon yielded to a brutal 49% bear market over the next 2.6 years. The SPX wouldn’t decisively power above those bull-topping levels until 12.9 years later in early 2013, thanks to the Fed’s unprecedented QE3 campaign! The greatest bull ended in tears.

    This post was published at ZEAL LLC on December 29, 2017.


  • New “Deep Learning” Hacking Technique Is 99.5% Effective Cracking Into Android Smart Phones

    Researchers at Nanyang Technological University in Singapore have developed a “deep-learning” for cracking into smart phones running the Android OS which has a “99.5 percent” effective rate after only three attempts, according to a new study reported by the Daily Mail.
    The method uses an algorithm to reveal a person’s passcode using the phone’s six built-in sensors, which analyzes the unique tilt of the phone and how much light is being blocked while a person enters their four-digit pin.
    Co-author of the study Dr Shivam Bhasin from Nanyang Technological University, Singapore (NTU Singapore) said: ‘When you hold your phone and key in the PIN, the way the phone moves when you press 1, 5, or 9, is very different.
    ‘Likewise, pressing 1 with your right thumb will block more light than if you pressed 9.’ –Daily Mail
    Researchers developed a custom Android application which analyzes data from a phone’s accelerometer, gyroscope, magnetometer, proximity sensor, barometer and ambient light sensor – in a method which can be used to guess all 10,000 possible combinations of four-digit PINs.

    This post was published at Zero Hedge on Fri, 12/29/2017 –.


  • Global Stocks Set To Close 2017 At All Time Highs, Best Year For The Euro Since 2003

    With just a few hours left until the close of the last US trading session of 2017, and most of Asia already in the books, S&P futures are trading just shy of a new all time high as the dollar continued its decline ahead of the New Year holidays.
    Indeed, markets were set to end 2017 in a party mood on Friday after a year in which a concerted pick-up in global growth boosted corporate profits and commodity prices, while benign inflation kept central banks from snatching away the monetary punch bowl. As a result, the MSCI world equity index rose another 0.15% as six straight weeks and now 13 straight months of gains left it at yet another all time high.
    In total, world stocks haven’t had a down month in 2017, with the index rising 22% in the year adding almost $9 trillion in market cap for the year.
    Putting the year in context, emerging markets led the charge with gains of 34%. Hong Kong surged 36%, South Korea was up 22% and India and Poland both rose 27% in local currency terms. Japan’s Nikkei and the S&P 500 are both ahead by almost 20%, while the Dow has risen by a quarter. In Europe, the German DAX gained nearly 14% though the UK FTSE lagged a little with a rise of 7 percent.
    Craig James, chief economist at fund manager CommSec, told Reuters that of the 73 bourses it tracks globally, all but nine have recorded gains in local currency terms this year.
    ‘For the outlook, the key issue is whether the low growth rates of prices and wages will continue, thus prompting central banks to remain on the monetary policy sidelines,’ said James. ‘Globalization and technological change have been influential in keeping inflation low. In short, consumers can buy goods whenever they want and wherever they are.’

    This post was published at Zero Hedge on Fri, 12/29/2017 –.


  • Hong Kong Ship Seized After Transferring Oil To North Korea

    Just days after we showed satellite images which indicated that Chinese ships were trading oil with North Korean ships in a blatant violation of UN Security Council sanctions, South Korea said Friday that it was holding a Hong Kong flagged ship suspected of doing just that.
    The Lighthouse Winmore is believed to have “secretly transferred” about 600 tons of refined petroleum products to the North Korean ship, the Sam Jong 2, in international waters in the East China Sea on Oct. 19, according to Bloomberg and the Associated Press.

    The Hong Kong vessel had previously visited Yeosu port on Oct. 11 to load up on Japanese oil products and departed the port while claiming its destination was Taiwan. Instead, it transferred the oil to the Sam Jong 2 and three other non-North Korean vessels in international waters

    This post was published at Zero Hedge on Fri, 12/29/2017 –.


  • Despite Being “Caught Red Handed”, China Denies Secretly Selling Oil To North Korea

    An official statement from Chinese officials tonight smacks of Obi Wan Kenobi – ‘these are not the secret oil trades you are looking for’.

    After being ‘caught RED HANDED’…according to South Korea’s Chosun Ilbo, U. S. recon satellites have photographed around 30 illegal transactions involving Chinese vessels selling oil to North Korea on the West Sea in October. The images allegedly showed large Chinese and North Korean ships transacting in oil in a part of the West Sea closer to China than South Korea. The satellite pictures even showed the names of the ships.

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • Mohamed El-Erian: “The World Is Nearing A Tipping Point”

    Mohamed El-Erian, chief economic adviser at Allianz, expects a fundamental shift in the global economy that will either result in a powerful economic boom or in renewed tremors at the financial markets.
    In the world finance, there are few people as highly respected as Mohamed El-Erian. Not only is the chief economic adviser at Allianz well versed when it comes to navigating the global financial markets, he’s also brilliant at explaining complex developments in a comprehensible way. The most prominent example is the concept of the New Normal which he and his colleagues developed in early 2009 when he was at the helm of Pimco together with Bill Gross. Today, this concept of a new economic reality, defined by slow growth and super low interest rates, is widely accepted. However, Mr. El-Erian predicts that the New Normal won’t continue much longer. He sees significant changes ahead that will either lead to a powerful economic boom or to a recession with renewed tremors in the financial markets.

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • Citi Fined $11.5 Million For Telling Retail Investors To “Buy” Stocks When It Meant “Sell”

    In a fine that is on one hand bizarre, and on the other vindication for all those who claim that nearly two decades after the Henry Blodget fiasco banks still tell their customers to do one thing (i.e. “buy”) while meaning the opposite, Citigroup was ordered to pay at least $11.5 million in fines and restitution to settle charges it displayed the wrong research ratings on more than 1,800 stocks, “causing many customers to own shares they never would have bought” a market regulator ordered on Thursday.
    FINRA fined Citigroup $5.5 million and ordered it to pay at least $6 million to retail customers over errors that occurred between February 2011 and December 2015, and involved more than 38% of the equity securities that the New York-based bank covered. From the filing:
    FINRA found that from February 2011 through December 2015, Citigroup Global Markets Inc displayed to its brokers, retail customers and supervisors inaccurate research ratings for more than 1,800 equity securities -more than 38 percent of those covered by the firm. Because of errors in the electronic feed of ratings data that the firm provided to its clearing firm, the firm either displayed the wrong rating for some covered securities (e.g., ‘buy’ instead of ‘sell’), displayed ratings for other securities that CGMI did not cover or failed to display ratings for securities that CGMI, in fact, rated. The firm’s actual research reports, which were available to brokers, and the research ratings appearing in those reports, were not affected by these errors.

    This post was published at Zero Hedge on 12/28/2017 –.


  • “Too Much Tech” – The Growing Peril Of Passive Investing

    “Too much of a good thing…” – That’s the message that many passive investors are unknowingly dealing with as they approach the year-end.
    In 2012, FANG Stocks (Facebook, Amazon, Netflix, and Google) accounted for less than 3% of the market cap of the S&P 500.
    At the end of 2017, those four stocks now account for over 8% of the S&P’s market cap…
    And, as WSJ reports, this is not limited to a small handful of stocks, it is worldwide – investors who loaded up on U. S. and Asian stock-index funds might be surprised to learn just what they own now: technology stocks – a lot of them.
    Led by Apple Inc., Facebook Inc. and their peers, the weighing of technology stocks in the S&P 500 index has climbed to 23.8% as of Dec. 26, from 20.8% at the end of last year, according to S&P Dow Jones Indices.

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • Renewable Electricity Generation Surpasses Nuclear For First Time Since 1984

    U. S. monthly electricity generation from utility-scale renewable sources exceeded nuclear generation for the first time since July 1984, in March, and again in April, the EIA reports.
    This outcome reflects both seasonal and trend growth in renewable generation, as well as maintenance and refueling schedules for nuclear plants, which tend to undergo maintenance during spring and fall months, when overall electricity demand is lower than in summer or winter.
    Record generation from both wind and solar as well as recent increases in hydroelectric power as a result of high precipitation across much of the West over the past winter contributed to the overall rise in renewable electricity generation this spring, while nuclear generation in April was at its lowest monthly level since April 2014. However, EIA’s latest Short-Term Energy Outlook (STEO) projects that monthly nuclear electricity generation will surpass renewables again during the summer months of 2017 and that nuclear will generate more electricity than renewables for all of 2017.

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • Natural Time Cycles: A Dow Forecast For 2018-2020

    ‘TIME is the most important factor in determining market movements and by studying the past records of averages or individual stocks you will be able to prove for yourself that history does repeat and that by knowing the past you can tell the future.’ W. D. Gann, 1939
    The analysis and forecasts presented in this article are based on the analytical framework of W. D. Gann. Gann is an investing legend, labeled as genius by many financial historians. He reportedly accumulated $50 million in profits during his trading career. His superior track record and those of others using his methods argues that, regardless of our opinion of his methodology, we should heed the advice of his work.
    A more detailed explanation of his analytical framework is included in the last section of this article.

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • As The Yield Curve Crashes To 10 Year Lows, Trader Shows “How To Put On A Steepener”

    Yesterday saw the US Treasury yield curve collapse to a fresh cycle low – the flattest curve since Oct 2007 – erasing the hoped-for trend change shift from last week…
    And this is occurring as net positioning in the long-end has never been more bullish.
    Between that and the effect of Trump’s tax reform plan, The Macro Tourist’s Kevin Muir lays out his thesis for getting long a steepening trade into the new year and details how to do it…
    Over the Christmas break, there has been a lot of chatter about this great chart from 13d Research that has been labeled, ‘the most important chart in the world.’

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • WTI Algos Confused As Crude Production Drops For First Time In 2 Months

    WTI/RBOB had roundtripped off initial API gains into the DOE data this morning which confirmed the sixth weekly crude draw, gasoline build in a row. Production dropped for the first time in 2 months, but WTI limped lower after the data.
    Bloomberg Intelligence Energy Analyst Vince Piazza notes that attention turns to 2018 after a relatively quiet holiday season. Concerns for production growth with stout hedging likely places a ceiling on WTI in the $60 range. Domestic storage remains elevated heading into a benign 1Q, even with the tailwind of crude exports.
    It’s difficult to appreciate how it gets much better for global crude with the OPEC/Russia accord in the rear view and North Sea and Canadian pipeline issues largely transitory curtailments. Regime intrigue in Saudi Arabia and broader geopolitical concerns in the region aid uncertainty and boost risk premiums, but the WTI benchmark is likely to be range bound next year on higher domestic upstream production.

    This post was published at Zero Hedge on 12/28/2017 –.


  • Trump Warns China – “No Friendly Solution” If They Keep Cheating On Korean Oil Exports

    Caught RED HANDED – very disappointed that China is allowing oil to go into North Korea. There will never be a friendly solution to the North Korea problem if this continues to happen!
    — Donald J. Trump (@realDonaldTrump) December 28, 2017

    President Trump took aim at President Xi this morning in a very clear tweeted warning that follows US spy satellite evidence that showed China allowing oil exports to North Korea.
    Trump exclaimed “caught red-handed” and said he was “very disappointed” by China’s actions. Perhaps more notable is that he explained “there’s no friendly solution” if this continues…
    As a reminder, this is what President Trump is upset about, according to South Korea’s Chosun Ilbo, U. S. recon satellites have photographed around 30 illegal transactions involving Chinese vessels selling oil to North Korea on the West Sea in October. The images allegedly showed large Chinese and North Korean ships transacting in oil in a part of the West Sea closer to China than South Korea. The satellite pictures even showed the names of the ships.

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • NY Gov Rips Trump Tax Bill: “Let’s Pillage The Blue To Give To The Red”

    It seems that Trump’s tax plan has officially turned New York Governor Andrew Cuomo into a “trickle down” economics guy.
    Apparently unhappy that the new tax legislation will result in higher taxes for the “millionaire, billionaire, private jet owners” of his state who have mortgages over $750,000 and annual property taxes of over $10,000, Cuomo said that the White House’s efforts to “spread the wealth around” are nothing more than an effort to “pillage the blue to give to the red.”
    “Look, there’s always politics in crafting of legislation. But, this was an egregious, obnoxious…what the Senate was saying is because we have no Senators from the ‘Blue States’ we don’t care. So let’s pillage the blue to give to the red.”
    “That’s never been done in this nation before. That’s partisan politicking over any semblance of good government.”

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • 2017: A Record Smooth Ride For Stocks

    As measured by the VIX, stocks have never enjoyed a less volatile year than 2017.
    Undoubtedly the most notable phenomenon of 2017 was the extremely smooth ride enjoyed by U. S. stocks – unprecedented, in fact. One way to measure just how smooth (or volatile) the market was is by looking at the readings of stock volatility expectations, in this case the S&P 500 Volatility Index, aka, the VIX. And based on VIX readings, 2017 was the least volatile year ever in the stock market.
    Specifically, the average daily closing price of the VIX in 2017 was 11.10 (through 12/26/17).

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • What Happens When A Russiagate Skeptic Debates A Professional Russiagater

    Authored by Caitlin Johnstone via Medium.com,
    Have you ever wondered why mainstream media outlets, despite being so fond of dramatic panel debates on other hot-button issues, never have critics of the Russiagate narrative on to debate those who advance it? Well, in a recent Real News interview we received an extremely clear answer to that question, and it was so epic it deserves its own article.
    Real News host and producer Aaron Mat has recently emerged as one of the most articulate critics of the establishment Russia narrative and the Trump-Russia conspiracy theory, and has published in The Nation some of the clearest arguments against both that I’ve yet seen. Luke Harding is a journalist for The Guardian where he has been writing prolifically in promotion of the Russiagate narrative, and is the author of New York Times bestseller Collusion: Secret Meetings, Dirty Money, and How Russia Helped Donald Trump Win.
    In theory, it would be hard to find two journalists more qualified to debate each side of this important issue. In practice, it was a one-sided thrashing that The Intercept’s Jeremy Scahill accurately described as ‘brutal’.
    The term Gish gallop, named after a Young Earth creationist who was notoriously fond of employing it, refers to a fallacious debate tactic in which a bunch of individually weak arguments are strung together in rapid-fire succession in order to create the illusion of a solid argument and overwhelm the opposition’s ability to refute them all in the time allotted. Throughout the discussion the Gish gallop appeared to be the only tool that Luke Harding brought to the table, firing out a deluge of feeble and unsubstantiated arguments only to be stopped over and over again by Mat who kept pointing out when Harding was making a false or fallacious claim.


    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • What Has Made America’s Inner Cities Into A Violent Warzone

    The stories coming out from Chicago and Baltimore paint an increasingly pessimistic picture: that America’s inner cities are transitioning into a warzone, where violence has returned to levels not seen since the drug wars of the early 1990s.
    Take for example Chicago, five men were killed and at least 20 people shot over the four-day Christmas holiday weekend. Last year, 59 people were shot over the same period, leaving 11 dead.
    Across the United States, homicides rose about 9% last year with more than one-third of the increase concentrated in Chicago neighborhoods, according to the Federal Bureau of Investigation (FBI). Despite the overall deterioration of American inner cities, there was some improvement in areas such as Los Angeles and Washington, D. C., where declines in violent crimes have been in downward trajectories since the 1990s.

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • Trump Tax Cuts – The Spark That Burns Down The EU

    Authored by Tom Luongo,
    For most of this year I’ve been wondering what would the spark that would set off a banking panic in the European Union.
    I know, but what do I do for fun, right?
    I’ve chronicled the political breakdown of the EU, from Brexit to Catalonia to Germany’s bitch-slapping Angela Merkel at the ballot box. All of these things have been open rebukes of EU leadership and it’s insane neoliberal push towards the destruction of national sovereignty and identity.
    And what has propped up this slow train-wreck to this point has been the world’s financial markets inherent need to believe in the relative infallibility of its central bankers.
    Because without competent people operating the levers of monetary policy, this whole thing loses confidence faster than you can say, ‘Bank run.’
    The confluence of these things with the big changes happening politically here at home with President Trump are creating the environment for big trend changes to begin unfolding.
    And, as always, you have to look to the sovereign bond and credit markets to see what’s coming.

    This post was published at Zero Hedge on Thu, 12/28/2017 –.


  • “Project Fear” Architect Now Thinks Brexit Will Have “Limited Impact” On UK Economy

    Lord Macpherson, the UK civil servant dubbed “The Architect of Project Fear,” now believes Brexit’s negative impact on the British economy will be limited if it is handled correctly…
    As a reminder, The FT points out, that Lord Macpherson was at the helm of the Treasury when his officials compiled a report suggesting that a post-Brexit, Canada-style trade deal with the EU would ultimately lower UK economic output by 6.2 per cent, costing British households 4,300 a year.
    The report, published in April 2016, came out a month after Lord Macpherson ended his decade as permanent secretary at the Treasury and was denounced by Brexiters for what they believe was scaremongering about the economic consequences of Brexit.
    Well, he has changed his mind, as economists do when faced with reality.
    Macpherson is now a little more upbeat.
    “Brexit is a risk but its economic impact should be limited provided [the government] seizes policy opportunity and looks forward not back,” he said in a tweet a few days before Christmas.

    This post was published at Zero Hedge on Thu, 12/28/2017 –.