David Rosenberg: “The Travesty Is We Have 23.5 Million Americans Aged 25-To-54 Outside The Labor Force”

Some observations on recent negative trends in productivity, employment mismatch, and labor training and education from the increasingly more bearish David Rosenberg, who notes that the Trump’s proposed policies may end up helping growth on the margins, but fail to focus on what is really important, making tens of millions of US workers competitive and qualified for today’s jobs market.
From Breakast with Rosie, via Gluskin Sheff
I don’t think we have a productivity problem – in fact, the demise of productivity is vastly overstated and that is because the Bureau of Labor Statistics (BLS) is likely vastly overstating labor input, and I’m talking here about how hours worked are estimated. But the real travesty, and what I think deserves top priority (but I don’t see it), is that we have, in addition to 7.5 million officially unemployed (a number that is closer to 15 million when all the hidden unemployment is accounted for), 23.5 million Americans aged 25-to-54 who reside outside the confines of the labor force. And at a time when job openings are at record highs.

This post was published at Zero Hedge on Jan 21, 2017.

Madonna: “I Have Thought An Awful Lot About Blowing Up The White House”

Today’s Women’s March in D. C., where allegedly over 500,000 women turned out to protest the Trump presidency, turned awkward on Saturday afternoon when Madonna took the stage and first dropped three f-bombs during her address, sending cable stations including C-Span, CNN and MSNBC scrambling to cut audio, before the singer casually admitted she had thought about blowing up the white house.
The prominent anti-Trump performer addressed the crowd saying “welcome to the revolution of love, to the rebellion, to our refusal as women to accept this new age of tyranny, where not just women are in danger but all marginalized people, where being uniquely different right now might truly be considered a crime. It took this horrific moment of darkness to wake us the fuck up.” The 58 year old singer then said, “to our detractors that insist that this march will never add up to anything, fuck you.” For good measure, she then said “fuck” again.

This post was published at Zero Hedge on Jan 21, 2017.

Spain’s Banks Openly Flout the Law Like Never Before

‘We probably have the best mortgage system in the world,’ explained Francisco Gonzlez, Executive Chairman of Spain’s second largest bank, BBVA, seemingly with a straight face last week at the annual World Economic Forum in Davos.
Given the devastating effects Spain’s ‘mortgage system’ has had on the country’s economy and society over the last decade and a half, Gonzlez’s sweeping statement is hard to fathom. It played a central role in stoking one of the most mind-boggling real estate bubbles of modern times, which was followed, in time-honored fashion, by a devastating crash that would have probably destroyed Spain’s financial system if it hadn’t been for the government’s taxpayer-funded bailout. To date, over 600,000 mortgage holders have been evicted from their homes in its aftermath.

This post was published at Wolf Street by Don Quijones ‘ Jan 21, 2017.

Say Hello To The New Boss, Same As The Old Boss

We are now 24 hours into the Trump era and the sky hasn’t fallen. The world hasn’t ended. In fact, nothing at all has changed.
The wars continue on, the IRS continues to extort people in the US for nearly half of everything they make, the NSA continues to spy on all and the Federal Reserve continues to inflate the currency all the while impoverishing the lower and middle classes.
You might say, ‘It’s only been 24 hours, give him some time,’ but the fact of the matter is that Trump has not talked about changing any of that. At most he’s talked about ‘auditing’ the Federal Reserve. But, there is no point to an audit. We know what the Federal Reserve does. It needs to be shut down effective immediately.
But, as we pointed out yesterday, even if Trump did want to do all the right things in terms of bringing freedom back to the USSA it won’t come without a massive, biblical level collapse of the current system.

This post was published at Dollar Vigilante on Jan 21, 2017.

One Hour After Taking Office, Trump Suspends FHA Mortgage Fee Cut

In a move that has sparked controversy among some economists, within an hour of being sworn in, Trump undid one of Barack Obama’s last-minute actions, a mortgage-fee cut under a government program catering to first-time home buyers and low-income borrowers. The cut, which would become effective on January 27, would have reduced the annual premium for someone borrowing $200,000 by $500 in the first year, however exposing taxpayers to further losses in case of a spike in defaults.
Last week, as part of a scramble of 11th hour actions by the outgoing president, Obama’s Housing and Urban Development secretary, Julian Castro, said the FHA would cut its fees. In addition to the morgage-fee cut, in the last days of Obama’s administration, the White House announced new Russia sanctions, a ban on drilling in parts of the Arctic and many other regulations. The administration didn’t consult Trump’s team before any of these announcements.
While nominal, Republicans have argued that fee reductions put taxpayers at risk by lowering the funds the FHA has to deal with mortgage defaults even though the net impact of such a fee cut is negligible in the grand scheme of things, once the next housing downturn arrives and the FHA is in need of another bailout.

This post was published at Zero Hedge on Jan 21, 2017.

Asian Media Warns Of Conflict, Economic Turmoil Under “Trump World Order”

Following German media’s outcry that “the demons have been unchained”, Asian media decried President Trump’s isolationist policies, fearing they will chill the global economy and sow widespread international discord, as “the reality show has become reality,” warning the world was now in “unpredictable territory… spreading unease, division, and conflict throughout the world.”
While perhaps not as entirely hysterical as German media’s ‘opinion’…
That was no presidential speech; that was a veritable declaration of war. Threatening in tone. Cold and calculating in logic. Change minus the hope. Donald Trump used the traditional Inauguration Day address to settle a score with the U. S. political establishment going back decades. With four ex-presidents sitting a few feet behind him, the 45th president delivered a populist manifesto. The negativity was ubiquitous across AsiaPac nations’ media outlets… (as Reuters reports)
In Japan, one of Washington’s oldest and staunchest Asian allies, newspapers across the political spectrum criticised the new administration, with more than one saying the world was now in “unpredictable territory.”
“Has there ever been a new U. S. administration that began by spreading unease, not expectations, throughout the world?” said the conservative Yomiuri Shimbun, adding that Trump appeared ready to take both alliances and global norms lightly if they didn’t benefit the United States.

This post was published at Zero Hedge on Jan 21, 2017.

500,000 Women Swamp Washington For Anti-Trump Protest March – Live Feed

Hundreds of thousands crowds of women, many wearing bright pink knit hats and carrying Starbucks lattes, swamped into downtown Washington, arriving by bus, train and car on Saturday for a march in opposition to U. S. President Donald Trump one day after the Republican took office.
Cited by AP, a city official in Washington said the turnout estimate for the Women’s March on the National Mall now stands at 500,000 people, more than double the initial predictions. Kevin Donahue is Washington’s deputy mayor for public safety and justice. He says on Twitter that organizers of the march are increasing the turnout estimate to half a million.

This post was published at Zero Hedge on Jan 21, 2017.

IBD Reports Clinton Foundation Is Closing Down

When you are not in a position to wield power and broker deals for the wealthy individuals, corporate entities and foreign Governments who stuff money into your bank account, the money flow stops. I just stops.
The first reports about the Clintons’ pay for play piggy-bank were that the Clinton Global Initiative would be shut down. Now it’s being reported by Investor’s Business Daily that the entire Clinton Foundation will be laid to rest.
One would think that maybe Hillary and Bill concubines could ride off into the sunset and maybe fade from public view? Not so fast. It remains to be seen if the Trump Government will go after the Clintons. And Obama paved the way for that to happen when he strolled out of the White House for the last time – after commuting more prison sentences than the 12 Presidents before him combined – without extending a ‘blanket’ pardon to Hillary.

This post was published at Investment Research Dynamics on January 21, 2017.

In Stunning Admission, Draghi Says A Country Can Leave Eurozone But Must “Settle Bill First”

Less than 4 years ago, and shortly after his infamous “whatever it takes” threat to speculators, Mario Draghi responded to a question from Zero Hedge readers, saying “there is no Plan B” when it comes to contingency plans for a Eurozone nation leaving the monetary union. The reasoning was simple: the mere contemplation of such a scenario assigned a probability to its occurrence, which is why the ECB was desperate to give the impression that no matter what, Europe’s cohesion is unbreakable.
Fast forward four years later, when not only has this particular strategy been thoroughly rejected, but for the first time ever the head of the ECB provided a framework, vague as it may be, laying out what a Eurozone exit would look like.
In a letter to two Italian lawmakers in the European Parliament released on Friday, and first reported by Reuters, Mario Draghi implied that a country could leave the euro zone – so much for “No Plan B” – but first it would need to settle or debts with the bloc’s TARGET2 payments system before severing ties. “If a country were to leave the Eurosystem, its national central bank’s claims on or liabilities to the ECB would need to be settled in full,” Draghi said in the letter. He did not specify in what currency the “settlement” would have to take place. It was also not clear just what the ECB would do in response if a country did not “settle its claims in full”: at last check the ECB did not have a policy-enforcing army.

This post was published at Zero Hedge on Jan 21, 2017.

Market Talk – January 20, 2017

Although many market players were expecting Chinese GDP around 6.6% most had speculated 6.7% and so a 6.8% boosted confidence ahead of the weekend and ahead of next weekends New Year celebrations. Government fiscal stimulus and additional bank lending’s were primary reasons provided. Although this helped the Shanghai exchange it failed to have the same effect on the more international Hang Seng. The Japan watched as the Yen retreated and the Nikkei rallied, which it has continued in after hours futures trading; currently up an additional 0.5%. Little activity was seen in Asian cash trading ahead of the excitement in the US.
It was funny today when dealers all provided different reasons for the mornings market movements. Some claim European stocks were better was because of USD strength (which hit the Euro and GBP), some claim oil price increase (currently up 1.5% ahead of this weekends meeting), some claim a large liquidation in Bunds and some say the nerves surrounding the massive miss in this morning UK’s data release. Whatever the reason the price is what it is and ahead of the US opening we saw a drive back into US Dollars.

This post was published at Armstrong Economics on Jan 20, 2017.

Trump Takes Over ‘Riskiest’ America Since World War II

While most are well aware that President Obama is leaving office having almost doubled the national debt during his ‘reign’, the more concerning fact is that this debt-splosion came with the weakest economic recovery in US history. What this means simply is that Obama is handing Trump the ‘riskiest’ America since World War II as debt-to-GDP is the highest since Truman.
Combine this…Worst Recovery Ever…

This post was published at Zero Hedge on Jan 20, 2017.

Foreign Governments Have Always Tried to Interfere With US Elections

Meddling with public opinion is by no means altering the voting machines or vote tallies. Fake news statements can be countered with truth, but only when our own media is not part of a domestic propaganda action to benefit one side, as was the case with 77% of all news stories anti-Trump and pro-Hillary. The Democrats boycotting the inauguration today are pathetic hypocrites who are angry that their own propaganda conspiracy in mainstream media failed despite all the TV stations and newspapers they influences, such as the New York Times who admitted they were wrong. Words by themselves do not diminish the legitimacy of any election and what the domestic American press and the Democrats did by deliberately ensuring Trump would be the Republican candidate was far more direct manipulation than anything Russia may have done.
Let’s be real here. There is a long history of illegitimate election results. In 1940, Roosevelt wanted to get into the war but the majority of Americans were isolationists.

This post was published at Armstrong Economics on Jan 21, 2017.

Gold Prices in 2017 Will Be Lifted by Donald Trump

Gold prices in 2017 are off to an exceptional start. After last week’s strong performance, the gold price has answered with an encore this past week. While stocks, oil, and the dollar endured volatility, gold prices steadily climbed higher throughout the week.
There’s little doubt that the inauguration of Donald Trump has had a lot to do with gold’s strength over the past few weeks. Americans – and much of the rest of the world – know very little about what Trump’s plans are, much less what he will actually do.
He’s made all kinds of noise about tax cuts, import duties, renegotiating or scrapping trade deals, and possibly even aggressive geopolitical stances.
But one of Trump’s concerns is the U. S. dollar. And one recent statement he made on the dollar could start a bull run for gold prices in 2017.
Before we get to that, here’s why the price of gold is up this week…
Gold Prices in 2017 Continue Winning Streak This Week
After spending the previous trading week climbing steadily towards $1,190, the gold price refused to step back.
It ended Friday, Jan. 13, near the important $1,200 mark, closing out the day at $1,197.

This post was published at Wall Street Examiner on January 20, 2017.

Where Are We Going, Where Have We Been?

Over the past few weeks, my life has turned upside down. Prior to the election, I thought of myself as a typical, repressed businessman, an outlaw guilty of capitalistic thoughts in a going-socialistic western world. At times I would break into night sweats, concerned about the potential problems coming my way via another government induced love-letter: notice of another income tax audit, another fake lawsuit from an employee looking to game our intentionally complex rules, or word of a new fee pushed by a special interest hiding under the guise of justice. It was always something.
Like millions of others, I too found myself fed up with the system, deprived of the enthusiasm necessary to expand my rental real estate business. In the eyes of the elites, we businessmen are perpetrators who should be punished appropriately for our success – success which our “devoted” leaders believe to have come at the expense of the working class. Nothing could be further from the truth. Rather, it is the “success” of our political leaders through their dysfunctional government policies that has impoverished labor. And what do our elitist political leaders do when their policies fail abysmally? They demand even more power – more taxation, more regulation, and more ‘fairness.’ Why break precedence? What a crock!
Yet one unforeseen election result on a Tuesday in November suddenly delivered hope – hope that tax rates will roll back meaningfully for the first time in more than a decade, hope that the monstrous machine of socialism will be slowed or perhaps even blown-up (just kill the beast!), hope that medical reform will actually include true market reform rather than mere giveaways both to the large drug companies and free-loaders with little skin in the game, and hope that one day my young children will enjoy the same opportunity that this great country offered me at a young age through a system that much more resembled capitalism. A least temporarily, my night sweats have now subsided and have been replaced with a newfound sense of optimism. No doubt there are others who are dissatisfied with the election results, but where have they been for the past thirty years while our government has perpetually expanded, destroying nearly every aspect of our lives by meddling in housing, healthcare, and education?

This post was published at FinancialSense on 01/20/2017.

As Its Housing Bubble Pops, Chinese Real Estate Firms Halt Monthly Pricing Data

That didn’t take long.
Earlier this week we reported that after 19 straight months of continued acceleration in home prices, China’s latest housing bubble may have finally burst (again) after December prices in the 70 cities tracked by the NBS, rose by 12.7%, below the 12.9% annual growth rate in the previous month – the first annual decline in nearly 2 years.
Fast forward to Friday, when at least two major Chinese private providers of home price data stopped publishing the figures, just as the housing market is stating to cool off at a dramatic pace across all Tier cities. According to Reuters, the China Index Academy, a unit of U. S.-listed Fang Holdings, has stopped distributing monthly housing price index data for 100 cities that it usually issued at the start of the month. The academy said it had suspended distribution indefinitely, without giving a reason for the suspension.

This post was published at Zero Hedge on Jan 20, 2017.

The Epidemic Of Bad Ideas

Our education begins within a few minutes of arriving on planet Earth. That’s when we begin to learn that crying and carrying on is rewarded with coddling and nourishment.
That particular lesson stays with us throughout our lives, more so with some people than others. I especially love watching red-faced yuppies trying to argue canceled airline flights back into service.
We also are educated by the physical world. Running barefoot and stepping on a tack/bee/piece of glass/thorn/etc. teaches us the importance of protective garments. As does our first time staying out too long shirtless in the sun.
Of course, our family members and friends also play an important role, teaching us the difference between wrong and right. Of course, as often as not, those concepts are subjective. Is it really ‘wrong’ to question your elders? Or ‘right’ to fall to your knees in prayer to an invisible superhuman at bedtime?
Maybe, maybe not. But not being privy to the hard data proving either point in our formative years, we are expected to take these various ideas on board without questioning. And, for the most part, we do.
It is also clear that having a poor role model can have long-term deleterious results. A single mother on welfare who is addicted to crack is unlikely to instill in Junior a strong moral compass or the work ethic needed to get ahead in a competitive world.

This post was published at Zero Hedge on Jan 20, 2017.

Warren Buffett: America Will ‘Work Fine’ Under President Trump

Yesterday, Warren Buffett, the chairman and CEO of Berkshire Hathaway Inc. (NYSE: BRK. A; BRK. B), said he thinks the United States will ‘work fine’ under President Donald Trump.
His reason: America’s got the ‘secret sauce’ – the ability to survive.
‘America works,’ Buffett told CNBC on Thursday (Jan. 19). ‘I’ve said this before. It’ll work wonderfully under [former Democratic presidential candidate] Hillary Clinton, and I think it’ll work fine under Donald Trump.’
The billionaire also conceded that he doesn’t think the United States works perfectly, ‘but you just look at where we go, milestone after milestone. Never bet against America.’

This post was published at Wall Street Examiner on January 20, 2017.

Morgan Stanley CEO James Gorman 2016 Pay: $22,500,000

With all eyes focused on Washington, on a Friday evening, Morgan Stanley just revealed that 58-year-old Morgan Stanley CEO James “don’t call me Jim” Gorman was paid $22.5 million. Despite a notable drop in earnings from expectations and a focus on cost-cutting, Gorman got a 7.1% pay rise (almost double that of Jamie Dimon).
Analysts expected Morgan Stanley to earn $3.155 in 2016. By the end of 2016 the firm realized just $2.756… but thanks to Trump’s election victory, the stock soared…

This post was published at Zero Hedge on Jan 20, 2017.

Trump And A New Gold-Backed Dollar

On August 15, 1971, President Nixon killed the last remnants of the gold standard.
Since then, the dollar has been a pure fiat currency, allowing the Fed to print as many dollars as it pleases.
Removing the US dollar’s last link to gold eliminated the main motivation for foreign countries to store large dollar reserves and to use the dollar for international trade.
At this point, demand for dollars was set to fall… along with the dollar’s purchasing power. So the US government concocted a new arrangement to give foreign countries another compelling reason to hold and use the dollar.
The new arrangement, called the petrodollar system, preserved the dollar’s special status as the world’s reserve currency.
In short, the US government made a series of agreements with Saudi Arabia between 1972 and 1974, which created the petrodollar.
The Saudis would use their dominant position in OPEC to ensure that all oil transactions would only happen in US dollars. And the US would guarantee the House of Saud’s survival.
It worked… for a while.

This post was published at Zero Hedge on Jan 20, 2017.