Category: zerohedge

We couldn’t help but smile at the irony…

Following headlines that Russian curler (yes a curler) Alexander Krushelnitsky was found to have meldonium in his system (a drug designed to aid in intense high activity sports) earlier in the Games…

Russian bobsled federation president Alexander Zubkov has just announced that a second athlete, Nadezhda Sergeeva tested positive for a banned heart medication.

Sergeeva was the pilot of the bobsleigh team that finished 12th in Pyeongchang, and her positive test result was announced on Friday morning.

But what makes her case so ironic is that just days ago, she appeared in an Instagram video wearing an “I Don’t Do Doping” sweatshirt.

In the video below, posted to the social network on 15 February by filmmaker Roman Bibishev, Sergeeva features in several scenes wearing a sweatshirt emblazoned with: “I don’t do doping, I am ZASPORT.”

 

20 и 21 февраля будет борьба за олимпийские медали по бобслею среди женщин. Надежда Сергеева вместе со своей командой будет бороться за победу. Именно про таких женщин написаны слова – ” Коня на скаку остановит, в горящую избу войдет”. Девченки я вас не забыл, надеюсь еще увидимся. Обязательно буду болеть за вас. #russia #sochi #adidas #sport #russionsport #skeleton

A post shared by Roman Bibishev (@romanbibishev) on Feb 15, 2018 at 5:04am PST

The substance that triggered Sergeeva’s positive result at the Olympics was trimetazdine, a medication used for angina sufferers. Sergeeva has denied taking the drug, with the Russian Bobsled Federation president Alexander Zubkov stating: “She confirms she took no such medication and the team confirms she was not issued any medication.”

via Zero Hedge http://ift.tt/2sQRxH1 Tyler Durden

As Bloomberg’s Michael Regan writes, “pinpointing the exact level of Treasury yields that will break the back of the bull market has become the trendiest parlor game in town.” Earlier today, Tom Lee of Fundstrat became the latest to chime in, predicting that rates – which are rising due to reflation, – should support higher P/E ratios until interest rates are above 4%.

Then, it was Jeff Gundlach’s turn.

Recall that it was Gundlach who during a DoubleLine webcast on January 9 predicted that if the 10Year goes to 2.63% – it was at 2.50% then – “stocks will be negatively impacted.” However, he also added that if the 10Y TSY passes 2.63%, it will head well higher, likely pushing toward 3%. Gundlach also was the first to note that he expects a 3.25% print on the 10Y in 2018, a target which was since adopted by both Goldman and, today, Bank of America.

Fast forward to today when speaking on CNBC, Gundlach estimated the fair value on 10Y yields in the USA to current nominal GDP. The gap is notable as current nominal GDP prints are above 4% with 10y yields below 3%.

Here is what he told CNBC:

Let’s start out with something people think I know something about, which is the bond market. And it seems that bond yields, let’s just talk about the ten-year treasury, are at a level that makes a pretty good of sense right now. I mean they’ve gone up a decent amount so far this year – ended last year at about 2.41% or so, they’re up 46 basis points or so. But one thing that people talk about is nominal GDP, and I’ve been talking about this for a long time. It’s a fairly good starting place, where you think about maybe the ten-year treasury should be.

Obviously there’s a lot of noise. I mean, they don’t track each-other anywhere close to perfectly. But it’s sort of like a dog that’s tied to a stagecoach that’s going across the country. It’s on a 100 foot rope, I mean, sometimes it will be behind the stagecoach and sometimes ahead, but if the stage coach is nominal GDP, and the not ten-year yield is sort of a dog, and yeah, there will be variation, one versus another, but they’re both going to end up going across the country together. There’s no way the dog can really stay that far away from the stagecoach.

So what’s going on now, nominal GDP in the united states is at 4.4%, which sounds really high compared to the 2.87 10-year treasury yield. But to be honest, it’s also manipulated. We should talk about Germany as a good starting place. The German yield is way down at a ridiculously low level because it’s manipulated. So the economic facts of Germany and the United States are not that different. The nominal GDP is about the same, the inflation rates aren’t that different, manufacturing is good in both areas, retail sales are good in both areas, but the German yield is being manipulated.

So when you think about a 10Y treasury yield, what we’ve been doing at Doubleline for the past few years really, is noting that it tends to reside in the average of nominal GDP and the competitor yield, which is the German yield.

So let’s look at where we are today.

The German yield is roughly 70 basis point, and nominal GDP is probably going to go up a bit, because GDP now from the Atlanta fed is 3.2% at present, and we’ll tack on a little bit of inflation, so let’s call it 5%. And so if you have 5% for nominal GDP in the U.S., and you have 70 basis points on Germany, add those together, you get 5.7. You divide by two, and lo and behold, you get 2.85%, which is within two basis points, even slightly less than that, as where you are today. So as long as bond yields do not break out to the upside, which is a clear and present danger right now, then you probably can keep some stability going in risk markets

Which then brings us to the follow up question: will yields break out to the upside? Here is what Gundlach said:

I have a low conviction feeling that we’re going to break out to the upside on yields. When I talked at the Barron’s roundtable earlier in January, I talked about how rates would likely rise this year, and a lot of people agree with that.

But right now the market is pressing right up against incredibly powerful yield resistance, particularly on the 30-year treasury bond.  The trendlines are all gone on all the maturities of the treasury market. If you go to the trendlines back to the last 5 years, in many cases even the great bull market that’s over 30 years, the move up in rates since September has taken out all of those trendlines. In fact, interest rates across the yield curve, other than the 30 year treasury have been rising since September 7th at an annual rate of about 200 basis points.

We’re coming up on almost five months into this yield rise, almost – really, coming up on almost six months now for this yield rise, they’ve been rising pretty quickly, but all the trendlines are gone. On the 30 treasury, you still have this one last line in the sand of – declaring that the bull market might still be intact and that’s the pivot point, which was the high yield back 18 months or so ago, and that’s at 3.22%.

So fascinatingly, the 30-year treasury bond closed at 3.22% a couple of days ago, right there, and it didn’t close above it. So for now, we’re only 6 basis points away from this incredibly important level.

So my viewpoint is this is a terrible trade location to be selling longer-term treasury bonds.

I’ll put it another way – if long-term treasury bonds are a great sale at 3.16%, they’re also a great sale at 3.25%. And we’re going to let the market decide on itself, give a signal as to if this breakout is going to happen.

If you force me to make a bet, I would say I do think they’re going to break to the upside. And when they do, they will accelerate. And if they accelerate, clearly what’s happened ever since 2.50% was breached on the 10-year treasury is the prices of treasury bonds and the prices have equities have started to become more correlated, meaning that when yields go up, stocks start to suffer. And I think, if we started to tack on significant yield with the breakout from these levels, it seems to me we would go back into another drop for risk assets.

So with all that said, here is a convenient paraphrase from Citi, which – taking Gundlach’s logic one step further – writes that perhaps a better metric for “fair value” or preferably a solid back of the envelope for 10Y yields is potential nominal GDP: this is also convenient because the CBO publishes this metric for years into the future.

Finally, the chart below suggests that any move above 4% on the 10y bond is unlikely to be sustainable while current yields are closing the gap from obviously too low to just about right.

 

via Zero Hedge http://ift.tt/2FqfqYI Tyler Durden

President Donald Trump’s placid press conference with Australian Prime Minister Malcolm Turnbull took an interesting turn Friday afternoon when a reporter from the Washington Examiner asked the president about his son-in-law Jared Kushner’s future in the West Wing.

 

Great question @gabriellahope_.

— Kyle Griffin (@kylegriffin1) February 23, 2018

 

And the president, as he often does, surprised his audience by offering a rambling non-answer, saying he’d ultimately leave the decision of whether to grand a waiver in the hands of Chief of Staff John Kelly. This is the first time the president or anyone from the White House communications department has offered a clue as to its thinking about Kelly’s new policy.

A week ago, Kelly announced that he would soon begin revoking temporary security clearances from the dozens of senior administration employees who still don’t have them – and Kushner, who is in charge of a large portfolio of responsibilities, is probably the most senior among them.

 

Asked whether he would give Kushner a security clearance, Trump praises his son-in-law and senior adviser as a hard-working and “extraordinary” man, and doesn’t answer the question. “Gen. Kelly will make that call. … I have no doubt he’ll make the right decision.”

— Shane Harris (@shaneharris) February 23, 2018

 

Trump repeatedly referred to Kushner as an “outstanding” and “extremely talented and extremely smart” young man who – by the way – is working without pay. Trump spoke highly of Kushner’s work ethic and devotion to bettering the country, but also admitted that he would leave the question of whether to grant Kushner a waiver up to Kelly, saying “I have no doubt he’ll make the right decision” and that Kelly “would do what’s right for the country.”

“He is truly outstanding. He was very successful when he was in the private sector. He is working on peace in the middle east,” Trump said.

That’s the strongest indication yet – throughout more than a year of governing – that Trump might be willing to countenance the departure of Kushner, who, apart from being one of his closest advisers, is also a close family member.

Trump also alluded to the possibility of launching a nuclear strike – or some other devastating attack – on North Korea, the first time he’s used such harsh language in a while. He also reaffirmed his preference for “bilateral” trade deals, while lauding Australia’s help in the battle against ISIS.

Of course, Kelly could certainly decide to grant Kushner the waiver, bowing to the implicit pressure from his mercurial boss.

He also said teachers would be more effective defenders of children than security cards because the teachers “love the children”.

 

via Zero Hedge http://ift.tt/2EOsC8t Tyler Durden

A former Trump campaign aide and longtime business partner of Paul Manafort, Rick Gates, has pleaded guilty to two charges in a scheme in which Special Counsel Robert Mueller claims more than $75 million flowed through secret accounts set up by the pair.

Gates will plead guilty to a conspiracy to defraud the United States “by impeding, impairing, obstructing and defeating” the DOJ and Treasury, and a second count of lying to authorities over his work with Manafort in Ukraine by giving a “materially false, fictitious, and fraudulent statement” to the Special Counsel’s office. 

Gates and Manafort stand accused of laundering over $18 million in income related to lobbying activities on behalf of the former President of Ukraine, through his firm, DMI – of which Gates transferred over $3 million from offshore accounts to accounts he controlled. Manafort and Gates used millions of dollars from the offshore accounts to pay for personal expenses, including the payment of Gates’ mortgage, his children’s tuition, and even interior decorating for his Virginia home, Mueller claims. 

In a statement, Manafort maintained his innocence.

“Notwithstanding that Rick Gates pled today, I continue to maintain my innocence. I had hoped and expected my business colleague would have had the strength to continue the battle to prove our innocence. For reasons yet to surface he chose to do otherwise. This does not alter my commitment to defend myself against the untrue piled up charges contained in the indictments against me.”

Mueller requested that the trial against Manafort and Gates to begin May 14, citing over half a million pieces of evidence, including imaged copies of 87 electronic devices. 

Gates will testify against Manafort in upcoming proceedings, and has been granted permission to travel to Boston with his children for spring break in the first week of March while wearing a GPS monitor. Based on court guidelines, he faces between 57 and 71 months in prison, however the Prosecution may request a shorter sentence.

Several new tax and bank fraud charges were levied against the pair this week by Mueller, which detail a scheme to launder over tens of millions in income and mask over $10 million from Cypriot entities which were disguised as loans.

In total, the two face 32 charges – 20 more than the original 12 count indictment. 

Mueller indicted the pair last October for laundering millions of dollars earned while acting as unregistered agents of the former Ukrainian government. In the superseding indictment filed on Thursday in federal court in Washington, they face new charges of tax evasion and bank fraud, as Bloomberg reported on Thursday. 

“Manafort and Gates generated tens of millions of dollars in income as a result of their Ukraine work,” the new indictment said. “From approximately 2006 through the present, Manafort and Gates engaged in a scheme to hide income from United States authorities, while enjoying the use of the money.”

 

NBC News reported yesterday that at least some of the bank fraud charges hinge on whether Manafort promised Stephen Calk, a Chicago Banker and president of the Federal Savings Bank, a position on Trump’s Council of Economic Advisers in August 2016. Manafort received three loans in total from Calk’s bank. Manafort borrowed nearly $18 million from the bank in 2016 and 2017.

Via NBC:

Special counsel Robert Mueller’s team is now investigating whether there was a quid pro quo agreement between Manafort and Calk. Manafort left the Trump campaign in August 2016 after the millions he had earned working for a pro-Russian political party in Ukraine drew media scrutiny. Calk did not receive a job in President Donald Trump’s cabinet.

The sources say the three loans were questioned by other officials at the bank, and one source said that at least one of the bank employees who felt pressured into approving the deals is cooperating with investigators.

In court filings Friday related to Manafort’s bail, federal prosecutors said they have “substantial evidence” that a loan made from the bank to Manafort using the Virginia and Hamptons properties as collateral was secured through false representations made by Manafort, including misstatements of income.

Meanwhile, Mueller’s team was able to persuade US District Court Judge Amy Berman Jackson to deny Paul Manafort’s modified bail package, noting that the properties pledged towards his $10 million bond was “unsatisfactory,” due to the fact that the property in question was already collateral on a loan for another property which Manafort may default on. 

Gates’ guilty plea follows weeks of speculation and a change in legal representation for Gates, who dropped lawyers Shanlon Wu, Walter Mack and Annemarie McAvoy for Sidley Austin senior counsel and personal acquaintance of Robert Mueller, Thomas C. Green.

Protecting Podesta?

Manafort worked closely with the Podesta Group as one of six lobbying firms to help Ukraine into the European Union between 2012 and 2014. Founded by Clinton campaign chairman John Podesta and his brother Tony, while operated by the latter, the Podesta Group was subpoenaed by Robert Mueller’s team last August in order to obtain testimony from executives who worked on the campaign.

Of note, while Manafort’s firm earned $17 million consulting for Ukrainian President Viktor Yanukovych’s pro-Russia ‘Party of Regions.’ During the same period, Manafort oversaw a lobbying campaign for the pro-Russia “Centre for a Modern Ukraine,” (ECMU) a Brussels based think tank linked to Yanukovych which was pushing for Ukraine’s entry into the European Union.

The Podesta group, operating under Manafort, earned over $1.2 million as part of that effort.

Curiously, the Podesta Group was clearly tipped off to Manafort’s investigation, as the firm retroactively filed DOJ forms they should have filed years earlier to disclose their work with the Centre for a Modern Ukraine and the Obama administration. The Washington Examiner reported last August:

Back in April, the powerful Washington lobbying firm run by Clinton ally Tony Podesta filed a document admitting its work for the pro-Russia European Centre for a Modern Ukraine may have principally benefited a foreign government. New disclosures revealed dozens of previously unreported interactions the firm made with influential government offices, including Hillary Clinton’s State Department and the office of former Vice President Joe Biden, while lobbying on behalf of the center. Embattled ex-Trump campaign manager Paul Manafort failed to disclose his extensive lobbying efforts on behalf of the center at the time as well.

One of the filings is for Tony Podesta himself, who was a bundler for Hillary Clinton’s 2016 presidential campaign. Tony and his brother John–Clinton’s 2016 campaign chairman–co-founded the lobbying firm in 1988.

Gates’ guilty plea suggests that he and Manafort “tricked” Podesta, ostensibly “company A” or “company B,” into their money laundering scheme:

“To conceal the scheme, Manafort and GATES developed a false and misleading cover story that would distance themselves and the Government of Ukraine, Yanukovych, and the Party of Regions from the Centre, Company A, and Company B. For instance, in the wake of extensive press reports on Manafort and his connections with Ukraine, on August 16, 2016 GATES communicated false talking points to Company B in writing.”

Paul Manafort, on the other hand, was indicted last October for – among other things, failing to register for the same work that Podesta retroactively “remembered to file” as the Mueller investigation was heating up. 

While the Podesta Group was disbanded shortly after Tony Podesta stepped down last year in the wake of the Mueller inquiry, a former longtime executive of the now-defunct lobbying firm who has been “extensively” interviewed by Robert Mueller’s team revealed to Fox that Manafort and the Podesta group had been working together since at least 2011 on behalf of Russian interests, and that Manafort was at the Podesta Group offices “all the time, at least once a month,” peddling influence through the ECMU think-tank. Manafort allegedly brought a “parade of Russian oligarchs” to Congress for meetings with members and their staffs, however, Russia’s “central effort” was to get to the Obama administration.” 

We don’t expect much of Manafort and Podesta’s alleged “oligarch peddling” operation to see the light of day, considering that it would implicate the Obama administration and directly ties to the Uranium One deal that Mueller’s FBI should have prevented from happening based on evidence from an undercover operative in the Russian nuclear industry, but who knows – maybe Manafort will write a book in prison depending on how things shake out. 

Rick Gates, on the other hand, should be out in 18 months, returning home to wife and four kids. 

via Zero Hedge http://ift.tt/2ok5Pvh Tyler Durden

If there is one thing that should scare investors out of a crowded trade, its a warning from veteran Wall Street-er Art Cashin.

As a reminder, speculative investors have never been more one-way positioned short in Treasury yields…

And UBS’ Art Cashin warned during a CNBC interview yesterday that it could be a bad day for the markets once the yield on the benchmark 10-year Treasury hits 3 percent:

“That 3 percent level is both a target and a kind of resistance. Everybody knows it’s like touching the third rail,” 

“The assumption is once they do it, all hell will break loose. So we’ll wait and see.“

The sharp moves seen Wednesday were probably due to “our friends, the long-lost ‘bond vigilantes,'” Cashin told “Squawk on the Street.”

“We’re going to need a couple weeks to see if the bond vigilantes really are back or not,” Cashin said.

“Or whether it was simply a fluke. But remembering what bond vigilantes look like, it certainly had fingerprints on them.“

But for now, since Cashin’s warning, it seems more than a few investors have taken some short bond chips off the table as Treasury yields have tumbled…

 

As bond yields have finally caught up to the inflationary signals from copper/gold…

via Zero Hedge http://ift.tt/2CeP7G5 Tyler Durden

Earlier this week we noted that as trader attentions have been focused on more conventional indicators of market risk, the USD Libor-OIS spread – historical a sign of credit concerns – has been blowing up, widening the most since last Feb as Libor has continued to creep higher, while commercial paper rates for financials are also rising as more issuers have been selling longer-dated obligations, and moving closer on the curve.

Well, earlier today the USD Libor-OIS spread widened again, pushing to 35bp, from 34bp the prior session as three-month Libor rose for the 13th straight session.

Among the most immediate catalysts for the rise is that as Bloomberg noted this morning, BofA revised its 3M Libor forecasts higher, and now sees 2.6% at end-2018 assuming three Fed rate hikes in 2018, a higher Fed effective rate and “persistent tightness” in USD funding conditions. The bank also boosted its Libor-OIS spread forecasts based on said tightening in USD funding conditions “and its evolution over coming quarters” and now sees 31bp by end-1Q, 38bp by year-end.

The key question here, and one we asked on Wednesday, is “why is there persistent tightness” in USD funding conditions, and is there another dollar shortage quietly forming behind the scenes?

In short, and as explained in more detail previously, the answer may be yes, and the culprit is the same “echo taper” discussed here last year (and recently by Credit Suisse’s Zoltan Pozsar) , when we commented on the impact repatriation would have on rates, and especially the front-end.

To grossly simplify, what is going on is what as a result of the hundreds of billion in repatriated cash, many companies will use the newly unencumbered proceeds to repurchase debt and delever (if only on a gross basis). This has a direct impact on dollar funding markets, and specifically the Libor OIS, as financial markets are now losing one of the biggest providers of funding in the front-end. This is certainly the case in the corporate bond market, but also the commercial paper market, money market funds, CDs, securitized products and other fixed income asset classes.  This was explained last October in “Why US Tax Reform Will Put Even More Pressure On Dollar Funding Markets.“

As BofA’s Hans Mikkelsen wrote, “it is impossible to overestimate the importance of this story and we are seeing the effects already in a number of ways.”

First, we think liquidations the past two weeks of 1-3 year paper in the corporate bond market is to some extent driven by this story (liquidations from foreign investors are possible too and the cost of dollar hedging is too high).

We are also seeing stress in the commercial paper market, 2-year swap spreads and LIBOR-OIS and one of the derivers we think is the overseas cash repatriation story. We continue to expect wider credit spreads in the front end of the curve

With every passing day, and with ever 1bps increase in the Libor-OIS spread, we are seeing the indirect effect repatriation will have on this key part of the fixed income market.

And now, in an alarming twist, it’s no longer just the US that is impacted.  As Bloomberg’s Richard Jones writes, “the rising USD Libor and wider FRA/OIS spreads are starting to infect other markets.“

Jones says to look at the U.K., where the ~5bps increase in 3-mo. GBP Libor fixings this month is drawing plenty of interest — especially as over half of the move occurred this week.

While part of that move is due to expectations of higher BOE rates, because the Libors are slower to price those in than Sonias or Short-Sterling contracts, with both the Fed and BOE having recently raised rates (and expected to do more), the higher USD fixing will exert upward pressure on the GBP fixing as well.

More importantly, Jones writes that traditionally wider OIS spreads have been a sign of credit concerns, and adding to the complication, you are get a widening of the cross-currency basis with it, which in turn makes it less economical for foreigners to purchase US Treasurys. In this context, below we show why buying FX-hedged US debt has become non economical. The Nordea chart below shows that a European investor is better off buying BUNDS than UST FX Hedged.

What is causing this distortion?  According to Jones, given that the 3M cross-Fx basis is quite tight, it’s clear other influences such as the supply of T-bills is in play; add to this concerns over how repatriation will impact dollar funding, and what until now was a modest tempest in a teacup has literally crossed across the ocean.

The irony is that the tighter the USD-funding conditions get, the wider the FRA/OIS spread will drift, the less global demand for FX-hedged US paper there will be, the higher US Treasury rates rise to prompt demand, until eventually yields push so high that the already stretched correlation between rising yields and stocks finally snaps, leading to an equity correction (or crash), which in turn forces the Fed to ease financial conditions, resetting the cycle all over again.

Bottom line: in addition to following the 10Y, the USD, and of course the S&P, add Libor/OIS to your watchlist: it may prove the most forward-looking canary in this particular coal mine.

via Zero Hedge http://ift.tt/2EOcCDA Tyler Durden

More than a year since the two world leaders reportedly engaged in a heated exchange that ended with President Trump angrily hanging up the phone, Australian Prime Minister Malcolm Turnbull and his wife are visiting the White House – and the two leaders are holding a joint press conference this afternoon.

The event begins at 2 pm. Watch live below:

Trump met Turnbull briefly when the two leaders boarded a US military ship the USS Intrepid. Turnbull later used this meeting as grist for a few jabs at Trump that leaked to the media last year. Trump is trying to safeguard the special relationship between the US and Australia and repair the damage caused by the US withdrawing from the TPP.

via Zero Hedge http://ift.tt/2CFBETq Tyler Durden

Authored by Pat Buchanan via Buchanan.org,

In days gone by, a massacre of students like the atrocity at Marjory Stoneman Douglas High School would have brought us together.

But like so many atrocities before it, this mass murder is tearing us apart.

The perpetrator, the sick and evil 19-year-old who killed 17 innocents with a gun is said to be contrite.

Having confessed, he faces life in prison. For the next half-century, Nikolas Cruz will be fed, clothed, sheltered and medicated at the expense of Florida taxpayers, including the families of those he murdered.

Cruz’s punishment seems neither commensurate with his crimes nor a deterrent for sick and evil minds contemplating another Columbine.

It didn’t use to be this way.

On Feb 15, 1933, anarchist Giuseppe Zangara tried to assassinate President-elect Franklin Roosevelt in Miami. His arm jostled, he killed instead Chicago Mayor Anton Cermak. Five weeks later, on March 20, 1933, Zangara died in the electric chair.

Swift, sure and pitiless, but that legal justice system worked.

With Cruz, the system failed up and down the line.

Cruz should never have been allowed to purchase or possess a gun. He was angry, alienated, isolated. Police had been to his family home to deal with complaints 39 times. Yet he had no arrest record when he purchased his AR-15.

Classmates at Douglas High had speculated that if there ever were a school shooting, Cruz would be the one to do it. The FBI was alerted a month before that Nikolas Cruz was a time bomb ready to explode.

The NRA was not responsible for the system-wide failure from Douglas High to the FBI. As the NRA’s Dana Loesch told CPAC Thursday:

“The government can’t keep you safe and some people want us to give up our firearms and rely solely upon the protection of the same government that’s already failed us numerous times to keep us safe.”

As for the AR-15, it is the most popular rifle sold. Five million to 8 million are in circulation. Veterans since Vietnam have trained with, and many fought with, the M16, which is first cousin to the AR-15. Veterans are among the millions who own them.

While all agree AR-15s should be kept out of the hands of crazies like Cruz, the establishment insists that it is the gun that is the problem.

We hear demands that AR-15s be banned and confiscated.

Proponents should put that proposition to a vote. But a prediction: The moment it is brought up for a vote, sales of AR-15s will explode, as they have before. If the weapon is banned, as alcohol was banned in Prohibition, millions of law-abiding Americans will become law-breakers.

And who will barge into America’s homes to seize and collect the rifles?

Moreover, if people have decided to mass murder classmates or co-workers, inviting “suicide by cop,” are they going to be stopped from acquiring a semiautomatic by a congressional law?

Have our drug laws halted drug use?

Many of the guns confiscated by police are in the possession of thugs, criminals and ex-cons who have no legal right to own them. Yet, if we are going to prosecute the illegal sale or transfer of weapons severely, we will have hundreds of thousands more in prisons, at a time when we are instructed to empty them of nonviolent offenders.

As for mental illness, it seems more prevalent than it used to be, and the numbers of those on medication seems a greater share of the population.

Do doctors decide which of their patients are fit to own a gun, and which are not? Should doctors be held criminally liable if they fail to alert police and one of their patients uses a gun in a violent crime?

Who will maintain the federal registry of the mentally sick unfit to own a firearm?

The anger and anguish of those who lost family or friends in this atrocity is understandable. But passion is not a substitute for thought.

There are twice as many guns in America as there were just decades ago. And a primary reason people acquire them is because they believe they need them to protect themselves and their families, and they no longer trust the government to protect them.

They view the demand for banning and confiscating specific weapons as a first step down the inexorable road that ends in the disarmament of the people.

Most mass shootings take place in gun-free zones, where crazed men of murderous intent know their chances of maximizing the dead and wounded are far better than in attacking a police station.

Our embassies are defended by Marines with M16s. Security guards with guns defend banks and military bases, presidents and politicians.

The best way to protect kids in schools may be to protect schools, and run down and incarcerate the known criminals and crazies who are the primary threats.

via Zero Hedge http://ift.tt/2GFWhkZ Tyler Durden

An associate of Sen. John McCain (R-AZ), David J. Kramer, has invoked his Fifth Amendment right not to testify over a November 2016 trip to London to retrieve a copy of the controversial Trump-Russia dossier and deliver it to the Arizona Senator. McCain then delivered it to former FBI Director James Comey, however the FBI already had a copy at that point in time – as Steele had been feeding the agency portions of the dossier beginning in July 2016. 

Kramer, a former State Department official, is a senior fellow at the McCain Institute for International Leadership at Arizona State University. 

While in London, Kramer met with former UK spy Christopher Steele – the author of the salacious and unverified dossier used by the FBI to obtain a surveillance warrant to spy on members of the Trump campaign, according to British court records obtained by Fox News. Steele was paid $168,000 by Democratic-linked opposition research firm Fusion GPS, which in turn was funded by the Clinton campaign and the DNC. 

Kramer was subpoenaed by the House Intelligence Committee in late December to discuss the trip, which he has now declined to comply with – however he gave a videotaped deposition last December in a separate litigation between Russian technology executives named in the dossier, and BuzzFeed News which published it in January 2017. 

The McCain associate is next expected to appear for a deposition in the BuzzFeed defamation suit on February 27, for which his attorney wants “his entire deposition as attorney’s eyes only confidential.” 

Christopher Steele, meanwhile, has also refused to testify before Congress – which resulted in a criminal referral issued to the Justice Department by Congressional investigators, requesting an investigation into whether Steele lied about the dossier’s distribution and his associated contacts with the media.

The “dossier” – a compilation of memos assembled by Steele, relied heavily on senior Kremlin officials – meaning Hillary Clinton, John McCain, David Kramer, top FBI officials, and every other link in the chain were directly involved in using Russian disinformation against a now-sitting President.

Moreover, Deputy Attorney General Rod Rosenstein, former Deputy Director Andrew McCabe and former FBI Director James Comey and Former Attorney General Sally Yates all signed off on the FISA surveillance warrant which used the Russian disinformation, according to a February 2 memo from the House Intelligence Committee. 

What’s more, according to the memo all of the officials who signed off on the FISA application were aware that the Steele dossier was highly unsubstantiated – and relied on the FBI vouching for the British operative. 

How’s that for collusion?

via Zero Hedge http://ift.tt/2CEfMrG Tyler Durden

Via GoldTelegraph.com,

Economists report the household debt to be at its highest in decades.  Yet, at the same time, we are being told that the economy is doing great. Does anyone see a serious contradiction?

In fact, the current economy only favors the wealthy owing to their flourishing financial assets such as stocks and bonds. Owing to the lack of real assets such as property and commodities, the middle and lower classes are becoming overwhelmed due to the serious consequences of the spending/debt cycle.

American consumers have a collective outstanding household debt of about $13.15 trillion of which nearly $1 trillion is the credit card debt alone, households are truly on a debt binge. These figures should be a wake-up call to all the Americans. The convulsive household debt has surpassed the bubble of 2008 and is still escalating. The economy may not be doing so great, after all.

Compared to 2008, the automobile credit balances have increased to $367 billion whereas the outstanding student loans are around $671 billion. Moreover, 67 percent of household debts belong to consumer mortgages. In 2016, twenty-five percent of all the Americans purchased a new or used vehicle and two-thirds of them are repaying through high-interest, long-term loans.

In fact, the consumer debt has exceeded their income for majority of the Americans.

Consumers have become accustomed using easy credit to maintain a lifestyle unaffordable for them otherwise. If this trend continues, and facts indicate that it will, we will be facing a monumental credit crisis in the near future.

A huge portion of credit card debt is the interest. Credit cards are a convenience and consumers readily pay for the privilege. However, it is necessary for consumers to know how credit card interest actually works.

Take the Smiths, a typical family with $2,000 in credit card debt. The Smiths don’t have a considerable cash reserve and only make a minimum monthly payment of $60.00 at 20 percent interest. The monthly payment against the principal is $26.67 while the interest amount is $33.33. With this payment schedule, the Smiths will pay $4,240 over a period of 15 years.

Mortgages are also a part of the household debt. While outstanding mortgages haven’t reached the bubble of 2008, they have still increased indicating  the possibility of another housing crisis in the not-too-distant future. Moreover, with the rising interest rates, the consumer credit may default. Some families rely on credit cards to meet the basic needs. This is the opposite of economic growth.

The decline in automobile sales is already an indication of the future consumer debt crisis. If lenders continue to provide easy access to credit regardless of its looming default and delinquent potential, retail purchase will face a sharp decline in 2018. This will have serious consequences on the overall economy.

The Federal Reserve and other global lenders are a significant contribution to the problem. They allow printing of trillions of dollars and yens for the lenders to distribute to the borrowing consumers at a high interest, leading to a worldwide inflation. All this printed wealth is merely an illusion yet it is raising the cost of living. Prices are rising at an alamingly faster rate compared to the consumer income. There is no increase in real assets. All this is but a mere mushrooming of debt.

The consequences of federal policy will be inescapable unless reversed and there are no signs of any reversal in near or distant future. At this rate, the consumers will soon face a critical financial bubble. Financial assets, such as stocks and bonds, risk losing substantial value. The wealthy can absorb the losses but the poor and middle class will face financial ruin. Consumers need to seriously consider the need to increase their “real” assets, such as real estate and commodities to prevent a long-term financial nightmare.

The chart below shows how the real assets have curved to an all-time low.

It is high time for the American consumers to wake up and stop believing in the magic of easy credit before it is too late. Their upgraded lifestyle is a bubble of an illusion that will burst soon enough.

via Zero Hedge http://ift.tt/2sVVXN9 Tyler Durden