California is Highest Taxes State in USA and should join the EU

Governor Jerry Brown never saw a problem that could not be solved by just raising more taxes. This time, the state pension fund is going broke as we have been warning with the building Pension Crisis thanks to mismanagement and low interest rates thanks to Larry Summers. California has already increased its gasoline tax by 50% in the past decade. Now to bailout the state employee Pension fund, Gov. Brown has proposed a 42% increase in gasoline taxes and, get this, a 141% increase in vehicle registration fees. Nobody talks about cutting government employee pensions. NEVER! Why when you have a population to milk like the cow.

This post was published at Armstrong Economics on May 14, 2017.

Why US Investors, And Especially VIX Sellers, Should Care About China In 1 Simple Chart

In the past few months we have extensively covered the end of China’s credit impulse…
People Are Suddenly Worried About China (Again) As the following chart from Goldman demonstrates, it has been China where policy uncertainty has stealthily exploded in the past three months according to policyuncertainty.com, while making virtually no new headlines.

This post was published at Zero Hedge on May 13, 2017.

Endgame On?

My Two Cents
By Andy Sutton / Graham Mehl
For many years now, thousands of bloggers, writers, and such have chronicled the debacle that is the US Economy. It is a joke. That fact has been well-established. We can liken it to a cancer. Not every section is influenced in the same manner or degree of severity, but all areas are affected somehow. This publication has struggled to stay firmly on the economic side of the fence and not delve into politics – especially the personal type of politics where Mr. X is the bad guy, but Mr. Y is the good guy. We have, however, entered the arena of geopolitics or the politics of nation vs. nation on many occasions because this is where the arena of battle happens to be.
Maybe at some point, someone will come up with enough math to tell us at what specific point the US Economy, led by its corrupt and thoroughly disingenuous monetary system, will finally roll over. We have avoided trying to ‘time’ this event since there are so many exigent factors involved that we feel there is so low a likelihood of getting it right that making predictions would be a disservice. Others haven’t felt that way and that is their prerogative, but unfortunately, the result is a group of people who were at one time fully engaged and have now become utterly desensitized to the point many have given up and returned to blissful ignorance. We had a former reader tell us not long ago that he just couldn’t live at DEFCON 1 all the time. He thanked us, along with several others, for not being part of the problem. As it turned out, our decision appeared to have been a wise one.
So, as we close out the first portion of this article and prepare to shift gears, we challenge every blogger – you don’t know when anything is going to take place. Most of you don’t have the ‘sources’ you claim – a few of you have admitted that to us with braggadocio. So, shut up about it. Write about something else. If you can’t sell your newsletters, trading services, and the like without scaring people with statements such as ‘When the markets crash this fall’ and similar idioms, then go get a real job. You’re no better than any government who would use fear to control its citizens. You’ve become that which you once claimed to despise. End of rant; on to the topic of the day.

This post was published at GoldSeek on Graham Mehl / Sunday, 14 May 2017.

It’s Really Crazy What This ECB Has Wrought

In the land of NIRP refugees and ‘Reverse Yankees,’ who will get crushed? At the end of the week, something special happened, something totally absurd but part of the new normal: the average yield of euro-denominated junk bonds – the riskiest, non-investment-grade corporate bonds – dropped to the lowest level ever: 2.77%.
April 26 had marked another propitious date in the annals of the ECB’s negative yield absurdity: the average euro-denominated junk bond yield had dropped below 3% for the first time ever.
By comparison, what is considered the most liquid and save debt, the 10-year US Treasury, carries a yield of 2.33%; the 30-year Treasury yield hovers at 3%.

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

Interest in Gold and Silver is Always Lowest When Opportunity is Best

Earlier, in February/March of this year, on my SKWealthAcademy SnapChat channel, I warned daily of potential deep pullbacks in the asset prices of gold and silver that then materialized. In mid-March as gold/silver prices recovered, I wrote a blog article, here, titled, ‘Expect Divergences, Not Convergences, Between US Stock and PM Asset Prices for the Remainder of the Year.’ This too has manifested, almost to perfection, thus far. As you can see from the chart below, after I posted that article, gold and silver mining stocks rose and US stocks fell. Then US stocks rose and gold and silver mining stocks fell. Will this relationship remain for the rest of 2017 as I predicted? Maybe not as perfectly as the below chart illustrates, but I still believe that this relationship will hold true in general for the rest of the year.

This post was published at GoldSeek on Sunday, 14 May 2017.

“Canada Hasn’t Seen A Bank Run Such As This In Decades” – Finance Minister Says Home Capital Bailout Is Possible

When we first said three weeks ago that the spectacular, sudden implosion of Canada’s largest alt-lender Home Capital Group or HCG – whose fate we had followed closely since 2015 – was Canada’s own “New Century Moment“, the parallels were more than just the obvious: like in the US, it took the market nearly a year to realize the full implications of the subprime collapse which first manifested in the failure of New Century and its subprime lender peers. When all was said and done, the world’s central banks had to pump (and still do) trillions into the financial system to stop it from disintegrating.
Slowly but surely, Canada is starting to appreciate just how serious the Home Capital failure is, and how the unprecedented bank run that has led to 94% of retail deposits fleeing the troubled lender…

This post was published at Zero Hedge on May 13, 2017.

How to Stick It to Your Banker, the Federal Reserve, and the Whole Doggone Fiat Money System

Bernanke Redux Somehow, former Federal Reserve Chairman Ben Bernanke found time from his busy hedge fund advisory duties last week to tell his ex-employer how to do its job. Namely, he recommended to his former cohorts at the Fed how much they should reduce the Fed’s balance sheet by. In other words, he told them how to go about cleaning up his mess.
***
We couldn’t recall the last time we’d seen or heard from Bernanke. But soon it all came back to us. There he was, in the flesh, babbling on Bloomberg and Squawk Box, pushing the new paperback version of his mis-titled memoir ‘The Courage to Act.’ Incidentally, the last time we’d heard much out of the guy was when the hard copy was released in late 2015.
With respect to the Fed’s balance sheet, Bernanke remarked that the Fed should cut it from $4.5 trillion to ‘something in the vicinity of $2.3 to $2.8 trillion.’ What exactly this would achieve Bernanke didn’t say. As far as we can tell, a balance sheet of $2.8 trillion would still be about 300 percent higher than it was prior to the 2008 financial crisis.

This post was published at Acting-Man on May 13, 2017.

Doug Noland: The VIX and the Scheme

There was little market reaction to Emanuel Macron’s widely-anticipated big victory in the French presidential election. The euro actually retreated somewhat, in a ‘sell the news’ dynamic. European equities ended the week mixed. European bonds were somewhat more interesting. Bund yields declined three bps, while Italian yields jumped nine bps.
‘Risk On/Risk Off’ analysis was rather inconclusive this week, though there were some indications of waning risk embracement. U. S. equites came under modest selling pressure. The S&P500 declined 0.3%, while the broader indices were weaker. The midcaps fell 1.1%, and the small cap Russell 2000 declined 1.0%. With Macy’s earnings badly missing estimates, retail stocks came under heavy selling pressure. This sector has given the bears a bit of life. Financial stocks were also under notable pressure. The banks (BKX) fell 1.3% and the broker/dealers (XBD) lost 1.5%. The Transports were hit 2.1%.
The general market was resilient in the face of ongoing Washington dysfunction. It’s not that surprising that President Trump’s firing of FBI Director Comey had a much greater impact within the media than in the markets. It’s my view that markets are more dominated by liquidity flows and speculative dynamics than the Trump agenda.
As for speculative dynamics, the Nasdaq 100 (NDX) and Morgan Stanley High Tech Index (MSH) traded at record highs this week, while the Semiconductors (SOX) are within striking distance. For the week, the NDX gained 0.7% (up 16.9% y-t-d), the MSH rose 0.6% (up 19.6%), and Semiconductors surged 3.4% (up 15.3%).

This post was published at Wall Street Examiner on May 13, 2017.

Gold Making The Turn

Not much action from markets as most heavy hitting stocks have reported already.
Having seen the most heavily weighted stocks report already takes away the earnings surprise strength which has helped keep markets looking great, especially the Nasdaq.
We haven’t seen the S&P able to breakout of its cup and handle and the handle portion is long in the tooth now and looking to roll lower as I suspected.

This post was published at GoldSeek on Sunday, 14 May 2017.

Trump Wants “Fast Decision” On Comey Replacement – Here Are The 11 Candidates

Donald Trump said he expects to make a “fast decision” on a replacement for fired FBI Director James Comey, perhaps before he departs the U. S. on May 19 for his first foreign trip as president. Trump said the candidates under consideration to lead the FBI – White House officials have identified 11 of them so far – are “outstanding people.” He said most are “very well known” and of the “highest level.”
As Bloomberg reports, the 11 candidates under consideration as a permanent replacement for Comey:
SEN. JOHN CORNYN
Cornyn is the No. 2 Senate Republican and a former Texas attorney general and state Supreme Court justice. He has been a member of the Senate GOP leadership team for a decade and serves on the Senate Judiciary Committee. In the aftermath of Comey’s dismissal, Cornyn said Trump was “within his authority” to fire him and said it would not affect the investigation of possible Russian ties to Trump’s presidential campaign.

This post was published at Zero Hedge on May 13, 2017.

Consumption And Taxes, Eh?

Usually it is too much beer that leads to a bar fight, in this case it was ‘unfairness’ and exploitation of the poor!
Bill
TAX SYSTEM EXPLAINED IN BEER:
Suppose that every day, ten men go out for beer and the bill for all ten comes to $100…
If they paid their bill the way we pay our taxes, it would go something like this…
The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.
So, that’s what they decided to do..
The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve ball. ‘Since you are all such good customers,’ he said, ‘I’m going to reduce the cost of your daily beer by $20’. Drinks for ten men would now cost just $80.

This post was published at JSMineSet on May 11th, 2017.

Is Blockchain A Gold & Silver Launchpad?

A new day is dawning for precious metals. Gold and silver – the world’s oldest money – are ‘connecting’ with the newest money, digital cryptocurrencies. The final outcome of this nexus is unpredictable, but it is foolhardy to ignore what is taking place.
***
Central governments around the globe have waged, against their own citizens, a virtual ‘War on Cash.’ Efforts by Sweden to become ‘cash-free;’ progressive ‘downsizing’ of Eurozone currency units; a currency recall in India that affected 1.3 billion people; solemn talk about eliminating $100 and even $50 bills in the U. S. – all in the supposed fight against ‘drug dealing and tax evasion.’

This post was published at Zero Hedge on May 13, 2017.

BREAKING: Chile Silver Production Down Stunning 26%

According to the most recently released data from Chile’s Ministry of Mining, the country’s silver production declined a stunning 26% in the first quarter of 2017. This is a big deal as Chile is the fourth largest silver producing country in the world. The majority of Chile’s silver production comes as a by-product of copper production.
Chile is the largest copper producer in the world, by a long shot. Last year, Chile produced 5.5 million tons of copper compared to Peru, who took a distant second place at 2.3 million tons.
Regardless, Chile’s silver production declined to 283.4 metric tons (mt) Q1 2017 versus 383.8 mt during the same quarter last year. Again, this is a huge 26% decline in the first three months of the year:

This post was published at SRSrocco Report on MAY 12, 2017.

Bank of China ATMs Go Dark As Ransomware Attack Cripples China

In the aftermath of the global WannaCry ransomware attack, which has spread around the globe like wildfire, a significant number of corporations and public services have found their infrastructure grinding to a halt, unable to operate with unprotected if mission-critical computers taken offline indefinitely. Some of the more prominent examples so far include:
NHS: The British public health service – the world’s fifth-largest employer, with 1.7 million staff – was badly hit, with interior minister Amber Rudd saying around 45 facilities were affected. Several were forced to cancel or delay treatment for patients. Germany’s Deutsche Bahn national railway operator was affected, with information screens and ticket machines hit. Travelers tweeted pictures of hijacked departure boards showing the ransom demand instead of train times. But the company insisted that trains were running as normal. Renault: The French automobile giant was hit, forcing it to halt production at sites in France and its factory in Slovenia as part of measures to stop the spread of the virus. FedEx: The US package delivery group acknowledged it had been hit by malware and said it was “implementing remediation steps as quickly as possible.” . Russian banks, ministries, railways: Russia’s central bank was targeted, along with several government ministries and the railway system. The interior ministry said 1,000 of its computers were hit by a virus. Officials played down the incident, saying the attacks had been contained. Telefonica: The Spanish telephone giant said it was attacked but “the infected equipment is under control and being reinstalled,” said Chema Alonso, the head of the company’s cyber security unit and a former hacker. Sandvik: Computers handling both administration and production were hit in a number of countries where the company operates, with some production forced to stop. “In some cases the effects were small, in others they were a little larger,” Head of External Communications Par Altan said.

This post was published at Zero Hedge on May 13, 2017.

Gold and Silver Technical Charts

Gold and silver are short term oversold, and *may* be putting in a bottom here, at least for the short term. The technical measures are shown on the first two charts.
Silver has been underperforming gold on this latest move later. But that is typically what an asset with a higher beta does. It underperforms on the dips, and overperforms on the rallies.
Gold and the SP 500 have turned in a similar performance year-to-date as shown on the third chart.
The gold/silver ratio is high as you can see on the fourth chart, but it seems to have been trending higher for some time now as gold and silver have been in a corrective pattern.
If a precious metal rally returns, that should change as silver obtains greater traction to the upside.

This post was published at Jesses Crossroads Cafe on 13 MAY 2017.

History of Gold – Interesting Facts and Changes Over 50 Years

History of Gold – How the gold industry has changed over 50 years
***
Thomson Reuters GFMS have compiled an interesting high level history of the gold industry in the last fifty years.
Topics covered and interesting historical facts to note include:
– Gold market size
– Gold mine production ‘peaked in 2015’
– South African production collapse from 1,000 tonnes
– South African gold was flown to London and Zurich and an airliner had its own designated landing areas at Heathrow where gold moved directly from the place to secure vaults

This post was published at Gold Core on May 12, 2017.

A2A with Bill Murphy of GATA

What an opportune time for an A2A webinar with our old friend, Bill Murphy of GATA. Lots of great discussion today about the current state of the metals “markets” so please make some time to give this audio a listen.
Many thanks to Bill for the generous donation of his time today. Among the topics discussed in this webinar:
The latest CoT wash and rinse cycle on The Comex. Are we seeing a capitulation of sentiment in the precious metals sector? Is there any limit to the manipulation and will The Cartel ever break? Will the civil litigation in silver have any price impact? Bill’s 40-yd dash time back when he was a WR with the Boston Patriots. And a whole bunch of stuff in between. Again, please carve out some time to give this a thorough listen. You’ll be glad you did.

This post was published at TF Metals Report on Thursday, May 11, 2017.

“Q1 Earnings Were Great, But…” – Goldman Pours Cold Water On The Strongest Quarter Since 2011

With 91% of companies in the S&P500 having reported earnings for the first quarter, Q1 2017 earnings season is almost fully in the history books, and is shaping up as the best quarter for annual earnings growth in six years. According to FactSet, the blended earnings growth rate for the S&P 500 in the first quarter is 13.6%, up from 13.5% last week, while revenue is poised to grow 7.8% Y/Y. The rise in profits was a function of both solid sales growth (+7.8%) and a 41 bp expansion in margins to 9.4%.
***
Additionally, 75% of S&P 500 companies have beat the mean EPS estimate and 64% of S&P 500 companies have beat the mean sales estimate.
If 13.6% is the final growth rate for the quarter, it will mark the highest (year-over-year) earnings growth for the index since Q3 2011 (16.7%).

This post was published at Zero Hedge on May 13, 2017.

So-Called ‘AI’ Is A House of Cards

Let’s dispose of the commonly-spewed horsecrap right up front: There is no such thing as “artificial intelligence” or “machine learning.”
What does exist is pattern recognition and the price of doing it well has gone down very rapidly as the cost and power of computing devices has gone down and up, respectively.
Decades ago doing it “well” required mainframes and then only in certain segments — because it was simply impossible to analyze a larger data set. AC Nielsen made their business out of analyzing supermarket checkout scanner data. So did IRI. Both did it using big iron and they were only looking at specific data from a specific source, which they paid for (frequently by subsidizing the installation of all that hardware in the grocery stores) and then sold back to the suppliers of those stores (food companies like Heinz.)
That was a symbiotic relationship. The grocery store got helped twice: First with the capital cost for installation of (at the time) extremely expensive checkout line scanners, which allowed them to bust the checker’s union and hire people at half their previous salary — and then again in that the overriding goal of a grocery store is, of course, to sell more groceries. As such empowering the food suppliers in figuring out what sold and what didn’t had no negative impact on the stores and in fact it was to their benefit. While two potato chip companies fighting over an endcap might be amusing to a store manager it didn’t do violence to the store’s sales numbers and actually might improve them.

This post was published at Market-Ticker on 2017-05-12.