• Category Archives Politics
  • A Plurality Of Voters Want Special Counsel To Investigate Clinton And Trump

    Despite Jeff Sessions’ surprising insistence during his testimony before the House Judiciary Committee earlier this week that there’s ‘no factual basis’ to appoint a special counsel to investigate actions by Clinton and former FBI Director James Comey, a plurality of voters believe special prosecutors should be investigating both the Clinton and Trump campaigns, according to a recent study that was shared with the Hill.
    The latest Harvard CAPS/Harris survey found that 44 percent of voters surveyed said a special counsel is needed to investigate both campaigns, meanwhile twenty-seven percent said only Trump needs to be investigated, while 21 percent said only Clinton needs to be investigated and nine percent said neither should be investigated.
    The poll’s findings also showed that the number of voters who believe Special Counsel Mueller has found hard evidence of collusion is a paltry 38 percent, while 36 percent say there is no hard evidence yet and 27 percent saying they don’t know.
    Unsurprisingly, the survey concluded that the public believes the Mueller investigation is hurting American democracy more than it is helping by implying that powerful, politically-connected Democrats who have the implicit support of the FBI and Deep State intelligence apparatus are immune to prosecution, while an outsider like Trump is not.

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


  • The Great Retirement Con

    The Origins Of The Retirement Plan
    Back during the Revolutionary War, the Continental Congress promised a monthly lifetime income to soldiers who fought and survived the conflict. This guaranteed income stream, called a “pension”, was again offered to soldiers in the Civil War and every American war since.
    Since then, similar pension promises funded from public coffers expanded to cover retirees from other branches of government. States and cities followed suit — extending pensions to all sorts of municipal workers ranging from policemen to politicians, teachers to trash collectors.
    A pension is what’s referred to as a defined benefit plan. The payout promised a worker upon retirement is guaranteed up front according to a formula, typically dependent on salary size and years of employment.
    Understandably, workers appreciated the security and dependability offered by pensions. So, as a means to attract skilled talent, the private sector started offering them, too.
    The first corporate pension was offered by the American Express Company in 1875. By the 1960s, half of all employees in the private sector were covered by a pension plan.
    Off-loading Of Retirement Risk By Corporations
    Once pensions had become commonplace, they were much less effective as an incentive to lure top talent. They started to feel like burdensome cost centers to companies.
    As America’s corporations grew and their veteran employees started hitting retirement age, the amount of funding required to meet current and future pension funding obligations became huge. And it kept growing. Remember, the Baby Boomer generation, the largest ever by far in US history, was just entering the workforce by the 1960s.

    This post was published at PeakProsperity on Friday, November 17, 2017,.


  • “Did Mike Pence Buy A Diet Dr.Pepper For A Woman That Was Not His Wife?”

    Authored by James Howard Kunstler via Kunstler.com,
    If only abortion were retroactive, we could suitably deal with monsters like Senator Al Franken (D – MN), who apparently ventured to apply a breast adjustment to a female colleague asleep on the military airplane winging them home from USO duty in Afghanistan. This was back in the day when Senator Franken was a professional entertainer, a clown to be precise, but his career shift to politics has rendered all his prior clowning anathema.
    Will he slink out of the senate in disgrace with (ahem) his tail between his legs? Or will he bunker in and wait until the mega-storm of sexual accusation roars on to strand some bigger, flashier fish on the shoals of ignominy?
    Perhaps we’ll soon learn that Warren Buffet repeatedly shagged his notoriously over-taxed secretary in the Berkshire Hathaway janitor’s closet.
    Or that Mike Pence once bought a diet Dr. Pepper for a woman who was not his wife!
    Seems to me this storm could roar and roil on until ninety-plus percent of the men in America are exposed as sex monsters and expelled from every workplace in the land. And then America can feel good about itself again. At least until the bond market blows up, or Kim Jung Fatboy sends a rocket over Rancho Cuckamonga.
    But in the meantime, this scourging of male wickedness raises some interesting questions about human dynamics vis-a-vis workplace dynamics.

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


  • How Tax Reform Can Still Blow Up: A Side-By-Side Comparison Of The House And Senate Tax Plans

    To much fanfare, mostly out of president Trump, on Thursday the House passed their version of the tax bill 227-205 along party lines, with 13 Republicans opposing. The passage of the House bill was met with muted market reaction. The Senate version of the tax reform is currently going through the Senate Finance Committee for additional amendments and should be ready for a full floor debate in a few weeks. While some, like Goldman, give corporate tax cuts (if not broad tax reform), an 80% chance of eventually becoming law in the first quarter of 2018, others like UBS and various prominent skeptics, do not see the House and Senate plans coherently merging into a survivable proposal.
    Indeed, while momentum seemingly is building for the tax plan, some prominent analysts believe there are several issues down the road that could trip up or even stall a comprehensive tax plan from passing the Congress, the chief of which is how to combine the House and Senate plans into one viable bill.
    How are the two plans different?
    Below we present a side by side comparison of the two plans from Bank of America, which notes that the House and the Senate are likely to pass different tax plans with areas of disagreement (see table below). This means that the two chambers will need to form a conference committee to hash out the differences. There are three major friction points:
    the repeal of the state and local tax deductions (SALT), capping mortgage interest deductions and the delay in the corporate tax cut. The House seems strongly opposed to fully repealing SALT and delaying the corporate tax cuts and the Senate could push back on changing the mortgage interest deductions. Finding compromise on these issues without disturbing other parts of the plan while keeping the price tag under the $1.5tn over 10 years could be challenging.

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


  • U.S. Treasury Becomes a Laughing Stock

    U. S. Treasury Secretary Steven Mnuchin appears to have inaugurated a perpetual bring your wife to work day. It’s become so farcical that it frequently feels like the United States Treasury Department has morphed into a low-budget, badly scripted reality TV show where the female star is so out-of-touch that she must continually scurry about in her haute couture erasing the haughty things she has written about the little people on multiple continents. We’ll get to that shortly, but first some background:
    It all started back on January 19 when actress and then fiance Louise Linton sat by her man during his Senate Finance Committee confirmation hearing to become U. S. Treasury Secretary. At the hearing, Democratic Senator Ron Wyden of Oregon had this to say about his repugnance to see Mnuchin fill the post as U. S. Treasury Secretary:
    ‘Mr. Mnuchin’s career began in trading the financial products that brought on the housing crash and the Great Recession. After nearly two decades at Goldman Sachs, he left in 2002 and joined a hedge fund. In 2004, he spun off a hedge fund of his own, Dune Capital. It was only a few lackluster years before Dune began to wind down its investments in 2008.
    ‘In early 2009, Mr. Mnuchin led a group of investors that purchased a bank called IndyMac, renaming it OneWest. OneWest was truly unique. While Mr. Mnuchin was CEO, the bank proved it could put more vulnerable people on the street faster than just about anybody else around.

    This post was published at Wall Street On Parade By Pam Martens and Russ Marte.


  • Keep Calm & Carry On

    Authored by 720Global’s Michael Liebowitz via RealInvestmentAdvice.com,
    ‘Before long, we will all begin to find out the extent to which Brexit is a gentle stroll along a smooth path to a land of cake and consumption.’ – Mark Carney, Bank of England Governor.
    In 1939, the British Government, through the Ministry of Information, produced a series of morale-boosting posters which were hung in public places throughout the British Isles. Faced with German air raids and the imminent threat of invasion, the slogans were aimed at helping the British public brave the testing times that lay ahead. The most enduring of these slogans simply read:
    ‘Keep Calm and Carry On.’ Ironically, it was the only one of the series that was never actually displayed in public as it was reserved for a German invasion that never transpired. Today, the British Government may wish to summon a fresh propaganda strategy to address a new threat on the horizon, that of the eventuality of Brexit.
    The Kingdom Divided
    The United Kingdom (UK) is in the process of negotiating out of all policies that, since 1972, formally tied it to the economic dynamics of the broader western European community. Since the unthinkable Brexit vote passage in June 2016, the unthinkable has now become the undoable. The negotiations, policy discussions, logistical considerations and legal wrangling are becoming increasingly problematic as they affect every industry in the UK from trade and finance to hazardous materials, produce, air travel and even Formula 1 racing.

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


  • Dollar Slammed, USDJPY Roiled On Trump Campaign Subpoena Report

    it has been a rocky session for the dollar which has dumped to a 4-week low, dragging with it USDJPY, the Nikkei and Treasury yields – and to a lesser extend US equity futures – all of which have slumped in the Japanese am session, following a WSJ report that Robert Mueller’s team “caught the Trump campaign by surprise” in mid-October by issuing a document subpoena to more than a dozen top officials.
    The campaign had previously been voluntarily complying with the special counsel’s requests for information, and had been sharing with Mr. Mueller’s team the documents it provided to congressional committees as part of their probes of Russian interference into the 2016 presidential election. The Trump campaign is providing documents in response to the subpoena on an ‘ongoing’ basis, the person said.
    If confirmed, this would be the first time Trump’s campaign has been ordered to turn over information to Mueller’s investigation, even if subpoena has not – for now – compelled any officials to testify before Mueller’s grand jury.

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


  • Venezuela, PDVSA CDS Triggered: ISDA Says Credit Event Has Occured

    In a long overdue, and not exactly surprising decision, moments ago the ISDA Determination Committee decided, after punting for three days in a row, that a Failure to Pay Credit Event has occured with respect to both the Bolivarian Republic of Venezuela as well as Petroleos de Venezuela, S. A.
    Specifically, in today’s determination, in response to the question whether a “Failure to Pay Credit Event occurred with respect to Petroleos de Venezuela, S. A.?” ISDA said that the Determinations Committee voted 15 to 0 that a failure to pay credit event had occurred with respect to PDVSA.
    ISDA said the DC also voted 15 to 0 that date of credit event was Nov. 13 and that the potential failure to pay occurred on Oct. 12. ISDA also announced that the DC agreed to reconvene Nov. 20 to continue talks regarding the CDS auction, now that the Credit Default Swaps have been triggered.

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


  • House Passes GOP Tax Reform Bill In Major Victory For Republicans

    Update: The House has passed its tax reform package with a final vote of 227 yeas to 205 nays. And while the Republican leadership has ordered the caucus not to gloat about the legislative victory – possibly the biggest so far for President Trump – Paul Ryan and Co. will be able to go home to their constituents and enjoy a relaxing Thanksgiving holiday.
    Their colleagues in the Senate won’t be so lucky.
    Senate leaders have said they’re working with holdouts like Ron Johnson as well as lawmakers like Bob Corker who are leaning toward voting against the bill in its current form. The Senate Finance is still marking up the bill, adding amendments and making alternations, but leaders say it’ll make it to a floor vote the week after Thanksgiving.
    Senators Marco Rubio and Mike Lee have wanted to see a bigger expansion of the childcare tax credit. Johnson has said more of the tax relief should go to LLCs via the pass-through rate and less generous breaks should be given to corporations.
    Here’s a list of the Republicans who voted ‘nay’.
    GOP no votes on the tax bill pic.twitter.com/QJ9vVdgPhG
    — Naomi Jagoda (@njagoda) November 16, 2017

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


  • Kyle Bass Is Having A Bad Day – Greek Bank Stocks Crash To 16-Month Lows

    Just over a month ago, Kyle Bass discussed why he was long effectively “long Greece.”
    Bass penned a Bloomberg editorial in which the hedge fund founder and CIO called on the IMF to stop bullying Greece – publicizing the fact that he is now effectively long Greece. Greek government bonds have performed reasonably well so far this year: They’re up about 16%, and if Bass is right, they could have another 20% to 30% over the next 18 months if the IMF abandons its insistence on austerity and acknowledges that debt relief will need to be part of the long-term alleviation of debt. Bass added that, in the near future, voters will elect a more business-friendly government that will help reestablish the country’s creditworthiness, much like the government of Mauricio Macri did for Argentina.
    I think you also have an interesting political situation in Greece where I think there’s going to be a handoff from the current Syriza government to kind of a more slightly-center-right but very economically independent new leadership in the next, call it, 18 months.
    And so, I think you asked why now? And I think you’re starting to see green shoots. You’re starting to see the banks do the right things finally in Greece and you are about to have new leadership.
    So, I think that you’re going to see – and if you remember Argentina as Kirschner was going to hand-off – hand the reins over to someone that was much more let’s say focused on business and economics than being a kleptocrat, I think you’re going to see something again slightly similar in Greece where you have leadership today that might not be the right leadership and the government-in-waiting, I believe, and I think you know Mr. (Mitsutakous) – I think you’re going to see something great happen to Greece in the and next, kind of, two years.

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


  • UBS Reveals The Stunning Reason Behind The 2017 Stock Market Rally

    It’s 2018 forecast time for the big banks. With Goldman unveiling its seven Top Trades for 2018 earlier, overnight it was also UBS’ turn to reveal its price targets for the S&P in the coming year, and not surprisingly, the largest Swiss bank was extremely bullish, so much so in fact that its base case is roughly where Goldman expects the S&P to be some time in the 2020s (at least until David Kostin revises his price forecast shortly).
    So what does UBS expect? The bank’s S&P “base case” is 2900, and notes that its upside target of 3,300 assumes a tax cut is passed, while its downside forecast of 2,200 assumes Fed hikes in the face of slowing growth:
    We target 2900 for the S&P 500 at 2018 YE, based on EPS of $141 (+8%) and modest P/E expansion to 20.6x.
    Our upside case of S&P 500 at 3300 assumes EPS gets a further 10% boost driven by a 25% tax rate (+6.5%), repatriation (+2%) and a GDP lift (+1.6%), while the P/E rises by 1.0x. Downside of 2200 assumes the Fed hikes as growth slows, the P/E contracts by 3x and EPS falls 3%. Congress is motivated to act before midterm elections while the Fed usually reacts to slower growth; so we think our upside case is more likely.

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


  • A Bullish Big Picture With Growing Near-Term Headwinds

    There are some growing signs of weakness in this market. Breadth is slipping, credit doesn’t look too great, there are more new lows versus new highs being made… that kind of stuff. I’m still not getting any major sell signals, except from my high-yield indicator. It flashed a signal today.
    But there’s word the recent weakness in junk may be due to concerns over how deductions for debt and interest payments will be treated in the Republican tax reform plan. I don’t know. Either way, I’m not seeing any major red flags outside of junk bonds just yet.
    I’m in ‘wait and see’ mode, just ‘sitting on my hands’ as Livermore would say. I’ve trimmed my book some but mostly because I want to free up capital for other trades that are lining up.
    One of these trades is long dollar. I won’t expend much digital ink laying out my long dollar case, I’ve already done that plenty.

    This post was published at FinancialSense on 11/16/2017.


  • Duties Imposed Against Chinese “Dumping” Hurt American Consumers

    For years, special interests have called on the U. S. government to ‘level the playing field’ in the form of duties, levies, and other antiquated measures. Democrats and Republicans alike have aired their grievances over the trade deficit, grumbling about exporters hurting American workers by flooding the market with cheap goods. These complaints are deeply misguided.
    Over the last decade, China has been accused of tilting international trade in its favor. Is this true? No, it is demonstrably false, as Beijing’s subsidized exports greatly benefit American consumers far more than the Chinese population.
    You can’t tell that to the U. S. government, though.
    In late October, the Department of Commerce announced that China dumped aluminum foil on the U. S. market, selling the goods at ‘unfairly low prices.’
    Trade policy under Trump hasn’t been dramatically different from his predecessors, though. Who who monitor trade deals have forgotten about President Barack Obama’s 35% tax on Chinese tires and President George W. Bush’s 20% tax on imported steel.
    US Imposes Anti-Dumping Duties Before Trump’s stop in Beijing as part of his 12-day Asian tour, the U. S. government imposed duties ranging between 96.81% and 162.24% on Chinese aluminum foil. The preliminary report determined that China dumped nearly $400 million worth of aluminum foil imports on the U. S. market in 2016 at very low prices.

    This post was published at Ludwig von Mises Institute on November 16, 2017.


  • Retail Sales (US) Are Exhibit #1

    In January 2016, everything came to a head. The oil price crash (2nd time), currency chaos, global turmoil, and even a second stock market liquidation were all being absorbed by the global economy. The disruptions were far worse overseas, thus the global part of global turmoil, but the US economy, too, was showing clear signs of distress. A manufacturing recession had emerged which would only ever be the case on weak demand.
    But the Fed just the month before had finally ‘raised rates’ for the first time in a decade, though after procrastinating all through 2015. Still, surely these wise, proficient technocrats wouldn’t be so careless and clueless as to act in this way during a serious downturn. After all, what are ‘rate hikes’ but the central bank’s shifting concerns toward a faster economy perhaps reaching the proportions of overheating.
    The dissonance was striking, nowhere more so than at the Federal Reserve itself. On the day the FOMC voted for the first of what was supposed to be (by now) ten to fifteen increases (not just four) the central bank also released estimates on US Industrial Production that were negative year-over-year, a condition that just doesn’t happen outside of either a recession or a condition very close to one.
    The mainstream sided easily and eagerly with the technocrats. Even as the Fed failed to act month after month, the word ‘transitory’ printed prominently in each article rationalizing why a manufacturing recession just wouldn’t matter, the media would claim how ‘strong’ and ‘resilient’ especially US consumers were.

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


  • House Set To Pass GOP Tax-Reform This Afternoon

    Last night, Sen. Ron Johnson surprised the GOP Senate leadership by coming out against the republican tax plan “in its current form”, the latest sign that the Republican push to pass comprehensive tax reform by New Year’s will struggle in the Senate. Still, that won’t stop the more Trump-friendly House of Representatives from passing their version of the bill, which they’re expected to do this afternoon following a meeting with the president.
    While the vote totals are expected to be tight, House Speaker Paul Ryan and Ways and Means Chairman Kevin Brady both said the bill will likely pass, and they wouldn’t be pushing for a vote unless they had it in the bag. President Trump will visit Capitol Hill ahead of the vote to rally support, but, according to the Hill, it appears there will be little need to twist arms. All three of the House’s major Republican factions have given the bill the green light.
    Speaker Paul Ryan (R-Wis.) and fellow leaders have been in a buoyant mood all week, signaling they have the 217 votes needed to pass the Tax Cuts and Jobs Act.
    And the days leading up to the vote have been relatively drama-free, as the three main House GOP factions – the far-right Freedom Caucus, conservative Republican Study Committee and moderate Tuesday Group – have either backed the bill or stayed on the sidelines.

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


  • BoE Deputy Governor Gives Crazy Speech Warning Markets Have Underestimated Rate Rises

    On 2 November 2017, the Bank of England raised rates for the first time in a decade and Sterling’s initial rise was promptly sold off by forex traders as we discussed.
    The 7-2 vote by the Monetary Policy Committee was not the unanimous decision some had expected, while Cunliffe and Ramsden saw insufficient evidence that wage growth would pick up in line with the BoE’s projections from just over 2% to 3% in a year’s time. Ben Broadbent, MPC member, deputy governor and known to be a close confidant of Governor Carney, gave a speech today at the London School of Economics (LSE) in which he warned markets that Brexit issues didn’t necessarily mean that interest rates have to remain low.
    Bloomberg reports that Broadbent stated that the Brexit impact on monetary policy depends on how it affects demand, supply and the exchange rate.
    “There are feasible combinations of the three that might require looser policy, others that lead to tighter policy.”
    Which sounds alot like he doesn’t know, although he stuck to the central bankers trusty tool, reassuring LSE students the Phillips Curve “still seems to have a slope”.

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


  • Tax Reform Shaping Up to Be Bad for Individuals, High-Tax States

    Details of the GOP tax reform bill have been released and what we’re finding is that it has the potential to impact taxpayers in several important ways, especially depending on where they live.
    This time on Financial Sense’ Lifetime Income Series, Jim Puplava talked about what we can expect to see if tax reform passes.
    For related podcast, see Tax Reform – Urgent – Call Your Advisor!
    Tax Brackets Are Shifting
    Historically, Republicans have focused on getting rid of deductions and Democrats have focused on raising tax rates. This can be good to an extent, but often, we’ve seen deductions taken away, only to see tax rate increases shortly thereafter.
    This bill does several things, Puplava noted. First, under the House version, two tax rates are actually raised. Those in the 10 percent tax rate bracket are bumped into the 12 percent bracket, and those in the 33 percent bracket are bumped into the 35 percent bracket.
    Two tax rates actually fall: the 15 percent rate drops to 12, and the 28 percent rate drops to 25 percent.

    This post was published at FinancialSense on 11/15/2017.