Having surged above critical technical levels this morning, US equities took a quick dive after President Trump tweeted his dissatisfaction at China’s efforts post trade-truce.
Mexico is doing great at the Border, but China is letting us down in that they have not been buying the agricultural products from our great Farmers that they said they would. Hopefully they will start soon!
As analysts and denizens of finance twitter half-seriously jest about this morning’s CPI print putting a July rate cut back into question, and thus cancelling out all the hard work Powell did yesterday trying to sound as dovish as possible, the Fed chairman is getting ready to begin his second day of Congressional testimony, this time before the Senate Banking Committee.
Republican Mike Crapo is the chairman, and it’s likely, with the chamber controlled by Republicans, that we could hear more questions about Powell’s plans to cut interest rates, as well as his economic outlook.
But hopefully for the Senators’ sake there are no more embarrassing flubs, like yesterday’s “Libra/Libor” mix-up.
Watch live below:
Read his prepared testimony here:
via ZeroHedge News https://ift.tt/2LfQ9Ge Tyler Durden
Amazon is grooming its vast workforce for the automation job apocalypse that the company itself is helping to bring about thanks to its robotics division.
As the company introduces more robots and automated systems to sort goods and fill orders at its warehouses, making more of its increasingly better-paid workforce redundant, the company apparently wants to be seen as giving them a chance to learn new skills – like, for example, how to code – before shunting them aside.
As WSJ reports, Amazon is planning to spend $700 million – a drop in the bucket compared with the company’s $240 billion annual revenue – to retrain a third of its American workforce to try and give them a fighting chance of still having a job once the robots take over. The program is designed to help workers find new jobs inside – or outside – the company.
The company expects to announce Thursday that it will retrain 100,000 workers by 2025 by expanding existing training programs and rolling out new ones meant to help its employees move into more advanced jobs inside the company or find new careers outside of it.The training is voluntary, and most of the programs are free to employees, the company said.
“Technology is changing our society, and it’s certainly changing work,” said Jeff Wilke, chief executive of Amazon’s world-wide consumer business, adding that the initiative is meant to help workers “be prepared for the opportunities of the future.”
As WSJ points out, the initiative breaks down to about $7,000 per worker. The company plans to save money by pressing some of its employees with a background in academia into teaching roles. As part of the initiative, Amazon will also expand a program for fulfillment-center employees called Amazon Career Choice which pays 95% of an employee’s tuition and fees for certificates and degrees in high-demand fields like being an aircraft mechanic or a nurse – even though the company doesn’t hire anyone with those skill sets. It’s just another example of Amazon being a magnanimous employer and ensuring that its warehouse workers might still be able to scratch out a living once they’re no longer needed on the warehouse floor.
Hourly workers in the company’s warehouses can retrain “for an IT support role” like…managing the machines that are being used in the warehouses. “Nontechnical” corporate workers can also opt to train on how to become a software engineer.
Even the software engineers – a skill set that the company can’t tap fast enough – will have the opportunity to retrain in a ‘machine learning’ lab, a skillset that the company desperately needs to cultivate, but which is also in short supply.
Some of the programs offered by Amazon include more advanced training, such as its Machine Learning University, which will be open to thousands of software engineers with computer-science backgrounds to take graduate-level machine-learning skills courses without going back to college. Amazon employees, some of whom are former university professors, will teach the classes.
There’s still some debate about whether workplace training programs work, since most employees are too busy juggling life, family and work to make time for learning new skills. But at least when its time for mass layoffs, Amazon will be able to tell the press that it gave its employees a chance to learn new skills – they just didn’t take it.
via ZeroHedge News https://ift.tt/2JFGghW Tyler Durden
The ground is constantly shaking in southern California right now, and this has many concerned that another large earthquake may be coming. I have been keeping my eye on Cal Tech’s recent earthquake map, and as I write this article it says that there have been 10,053 earthquakes in California and Nevada over the past 7 days. I have never seen that number so high, and southern California is being hit by yet another new earthquake every few moments.
Most of the earthquakes are happening out in the Ridgecrest area where we witnessed the magnitude 6.4 earthquake that hit on July 4th and the magnitude 7.1 earthquake that hit on July 5th. But as you can see from Cal Tech’s map, there has been a tremendous amount of seismic activity along the San Andreas fault as well. As I discussed the other day, the San Andreas fault is “locked and loaded” and it is way overdue for “the Big One”. Could it be possible that all of this earthquake activity is leading up to something really big?
And it isn’t just earthquakes that we need to be concerned about. According to Fox News, “geologists are nervously eyeing eight nearby volcanoes”…
California’s uncanny “earthquake pause” is over. It should have already had several “big ones” by now. All that pressure has to go somewhere. Now geologists are nervously eyeing eight nearby volcanoes. And why has Yellowstone supervolcano been acting so weird?
The U.S. Geological Survey (USGS) has warned Southern California to expect more big earthquakes to come. Some, they say, may even be more powerful than those experienced in the past few days.
“(These quakes do) not make (the Big One) less likely,” local seismologist Lucy Jones told The Los Angeles Times. “There is about a one in 20 chance that this location will be having an even bigger earthquake in the next few days, that we have not yet seen the biggest earthquake of the sequence.”
Could you imagine the chaos that would ensue if a volcano suddenly erupted in California?
For the record, I am personally far more concerned about Mt. Rainier and the other volcanoes in the Northwest. But that is a topic for another article.
One angle that hasn’t really been talked about much is what would happen to California’s nuclear reactors if “the Big One” suddenly hit the San Andreas fault.
According to Natural News, there are currently five nuclear reactors right along the San Andreas fault and another one that is located directly along the coast…
A Natural News investigation into the geolocation of nuclear power facilities in California reveals that five nuclear facilities were built in close proximity to the San Andreas fault line, with some constructed right in the middle of earthquake zones that have up to a 50% chance of a severe earthquake every 30 years.
One nuclear power plant – the Diablo Canyon Nuclear Power Plant which produces 2,160 megawatts — was constructed on the coast, making it extremely vulnerable to the very same kind of ocean water surge that destroyed the Fukushima-Daiichi facility which suffered a 2011 meltdown in Japan.
Who was the genius that decided to build those reactors near the San Andreas fault?
The potential for an unprecedented nightmare is definitely there. If a magnitude 9.0 earthquake were to hit the San Andreas fault, it would be 707 times more powerful than the magnitude 7.1 earthquake that we just witnessed.
And we live at a time when our planet just continues to become even more unstable. According to NBC News, the number of “great” earthquakes between 2004 and 2014 was 265 percent higher than during the preceding ten year period…
The annual number of “great” earthquakes nearly tripled over the last decade, providing a reminder to Americans that unruptured faults like those in the northwest United States might be due for a Big One.
Between 2004 and 2014, 18 earthquakes with magnitudes of 8.0 or more rattled subduction zones around the globe. That’s an increase of 265 percent over the average rate of the previous century, which saw 71 great quakes, according to a report to the annual meeting of the Geological Society of America this week in Vancouver, British Columbia.
But despite all of the unusual shaking that we have witnessed so far this century, the state of California hasn’t seen anything remotely close to the shaking that we have witnessed over the last 7 days.
Of course seismic activity is just one element of “the perfect storm” that is starting to unfold. According to the NOAA, the 12 month period ending in June was the wettest 12 month period in all of U.S. history. In fact, for three months in a row “the past 12-month precipitation record has hit an all-time high”. We just keep setting record after record, and the flooding in the middle of the country seems like it will never end. Millions of acres of prime farmland will not be used at all this year, and tens of millions of acres of crops are in extremely poor condition right now.
Lines of thunderstorms associated with a weather system that is predicted to develop into a hurricane by Friday struck New Orleans with as much as 7 inches of rain within a three-hour period Wednesday morning, forecasters said.
The city was engulfed with water, leaving residents to contend with swampy streets, overturned garbage cans and flooded vehicles. Some even paddled their way down the street in kayaks.
But the worst is still yet to come. The storm may become a hurricane before it makes landfall, and it is going to push the Mississippi River to one of the highest levels ever…
The deluge may have just been a preview of more serious flooding situation from Tropical Storm or Hurricane Barry, which could affect the area into the weekend.
On Saturday, the Mississippi River is projected to see one of its highest crests on record in New Orleans, or the highest in seven decades.
A state of emergency has already been declared in Louisiana, and this could turn out to be the biggest disaster for the state since Hurricane Katrina.
Why is disaster after disaster suddenly pummeling the United States?
And could it be possible that this is just the beginning of our problems?
A time of great change is now upon us, and I have a feeling that what we have experienced so far is just the tip of the iceberg.
via ZeroHedge News https://ift.tt/2XEokte Tyler Durden
Senator Chuck Schumer accepted thousands of dollars in donations from Jeffrey Epstein in the 1990s, according to the NY Post. Schumer has recently been vocal in demanding that President Trump “answer” for his relationship with Epstein, while also urging Labor Secretary Alexander Acosta to resign.
FEC records showed that Schumer took in seven $1,000 donations between 1992 and 1997 from Epstein. The donations were accepted first as a US congressman, then later while running for the state’s senator.
We reported Sunday night that Epstein had has been arrested for allegedly sex trafficking dozens of minors in New York and Florida between 2002 and 2005. The new charges claim that “Epstein sexually exploited dozens of underage girls in a now-familiar scheme: paying them cash for ‘massages’ and then molesting or sexually abusing them in his Upper East Side mansion or his residence in Palm Beach.”
Epstein also donated $10,000 to Victory in New York, a fundraising committee established between Schumer and the Democratic Senatorial Campaign Committee.
He also donated $5,000 to Win New York, a Schumer-linked joint committee that benefited the Liberal Part of New York State. Both of these donations took place in October 1998 and benefited the Liberal Party of New York, as Epstein had likely already hit his $2,000 limit in donating directly to Schumer.
The NY Post says that Schumer and Schumer-linked entities received $22,000.
A spokesman for Schumer said:
“While these campaign accounts closed about 20 years ago, and even then the campaign never controlled the two political action committees (PACs), Senator Schumer is donating an equal sum to anti-sex trafficking and anti-violence against women groups.”
Schumer previously donated $14,200 to charities supporting women after it was revealed he had taken that amount in donations by accused sex predator Harvey Weinstein.
Schumer demanded on Tuesday that Labor Secretary Acosta resign, stating:
“Instead of prosecuting a predator and serial sex trafficker of children, Acosta chose to let him off easy. This is not acceptable. We cannot have, as one of the leading appointed officials in America, someone who has done this.”
Schumer said the DOJ should make its public review of Acosta’s handling of the case public.
Finally, Schumer has demanded that Trump elaborate on comments he made in 2002 when he called Epstein a “terrific guy”.
via ZeroHedge News https://ift.tt/2Lgag7w Tyler Durden
“The Sky is not the limit – there are footprints on the Moon.”
So many choices for this morning’s quote. The classic Armstrong “One Step” was too obvious. I did think about “To infinity and beyond”. But the one I chose is perhaps the best. Points if you can name who said it. Only four of the 12 men who walked on the Moon are still with us. It was a long time ago, but last night my wife, son and I were out to dinner in the West End. As we walked back past the Lego Store inn Leicester Square – look what was in the window! I’m going back to buy it later today!
It took me back 50 years – July 11 1969. I was in the back garden in Fox Covert, Edinburgh, staring excited at the moon, asking Dad where the spaceship was. He tried to explain how far away it was and since it was only the size of a car, I’d not be able to see it. It was a terribly exciting day – the BBC showed the film of HG Well’s First Men on the Moon. Then came the iconic music; Also Sprach Zarathustra, which defined the whole Apollo era. Patrick Moore and James Burke explained what was going on. James Burke is still making sense today! We waited and waited and then the words. At some point I must have fallen asleep because I woke up in bed with my Action man lying on the floor in his (Gemini) spacesuit.
It would be a terrible pity if we don’t go back to the Moon. Does it make commercial sense for us to go further? I’d like to think so, but the scale, the sheer immensity of space, the rules of orbital gravity and radiation mean we’re not going to travel to Jupiter in a few hours any time soon. A few years perhaps, and few years to come back with what? Minerals, raw materials? Or maybe not – 200 years ago it took a year to get to Australia and back. Today I’ve been there and back in a week. It took Magellan’s fleet 3 years to circumnavigate the globe – 18 men out of 270 made it.
Back to the present…
The big theme this morning is Jerome Powell’s comments y’day – 25-50 bp ease from the Fed looks nailed on for later this month. We’re expecting similar directional guidance from the ECB and Bank of England today. The markets will breathe a sigh of relief – and party on. The Fed dismissed the strong jobs report, reckons inflation is easy, and is willing to pander to Trump ease rates to counter signs of a slowing global economy and ongoing trade risks. Dollar took a bit of a spanking – but that’s another thing El Presidente will love.
Yesterday I was talking about how Boeing might be the canary in the coal mine that crushes the on-going stock optimism. Folk generally agreed with my analysis the company management has made serious mistakes that aren’t reflected in a lower stock price, and that price has been artificially held up by dint of the plane-maker being the largest component of the Dow-Jones. Everyone has to hold Boeing to match the index – that could change dramatically if the market shifts and everyone wants to go short!
Another new factor my chums in aviation finance have noted is potential stress in the aircraft finance market when the Boeing 737 Max finally gets recertified. We reckon there are about 150 undelivered unpaid MAXes sitting at Boeing – including some parked in the employee car parking spaces!! They cost about $2000 each per month – and nots just the parking tickets! They are adding about 10 planes each week. When the aircraft are recertified Boeing will be in rush to deliver – but financing what could be up 370 new aircraft in November (if that is when they get permission to fly) could be a nightmare. It could be a shock to markets. (And I’m trying to think how we arb it! A chat with Boeing might be on the cards – if some of the big funds wants to lend me $10 bln I can promise a very asset based secured attractive return!)
Boeing is a crisis because of the mistakes its management have made. (And they won’t like me saying it.)
Potentially even more dangerous for Markets is BASF, the German Chemical giant. Earlier this week it missed expected numbers massively and has shocked complacent markets. BASF confirms the genuine damage US / China trade has had on the global economy. This is a company that has seen its stock whapped, and EBITDA expected to plummet down 30%, because of the global economy rather than management cluster-failure. If it’s happened at BASF, it is going to happen elsewhere else. BASF is down 21% since April and crashed 7.5% on the news before wobbling back up a bit y’day.
All this should get investors thinking about what’s really going on in the corridors of power. We’ve got Central Banks around the world being overly accommodative, pumping money into Financial Assets on the hope and a prayer of avoiding a massive and destabilising stock market crash. If it happens global sentiment will be crushed, and you can bet the next stage will be folk talking about over-indebted Sovereigns and slide in bonds as well. I’ve been warning for so long about the scale of bubbles in Financial Assets – bonds and stocks – I’m beginning to bore even myself.
The first reality is BASF. It shows corporate earnings in a global supply-chain based economy are critical. If the next couple of weeks US Earnings confirm spreading pain, then the optimism to buy the FED crack-ease is going to flop.
The second reality is China. Forget what anyone is telling you about the USA being the most important Economy. Its not. Its been China and its’ associated growth that’s been driving global growth for the last 10 years. When the Chinese economy was growing 7-8% annually, it was a rising tide lifting all boats.
Now the Chinese are transforming their economy. The plan is a consumer led and consumption based happy state-loving economy – and it sure has problems. Which country doesn’t? But its also engaged in a cut-throat political/trade war with its biggest market – The USA. Look at the news of China graduates now struggling to find good jobs, the clampdown on conspicuous consumption by the wealthy, unsold houses, a domestic debt crisis, companies defaulting. Welcome to a China we recognise from our own experience.
China Growth is likely to slow to more like 4% as it continues to mature. And if China is 4%, the shocking global reality is global growth is much much lower than the Central Bank geniuses expected. They’ve been juicing asset markets for the last 8 years with lower-for-longer rates and QE – with the effect of creating massive asset bubbles in both. They’ve been hoping rising growth (fuelled by China) will justify the levels financial assets have reached. But it won’t – global growth is slowing because China is maturing. Which means financial assets are, and will remain, a bubble.
Pop.
When the market finally grasps the fact lower interest rates are not going to be supported by growth, that’s when you really want your hard hat handy.
via ZeroHedge News https://ift.tt/32lWrti Tyler Durden
Having slowed and disappointed for the last two months, all eyes are on US consumer price index growth (which was expected to slow once again in June) this morning as the next Fed rate-cut narrative confirmation.
The problem for rate-cut-hopers is that the picture is mixed at best. Headline CPI slowed to +1.6% YoY (exactly as expected) – below The Fed’s mandated 2.0% ‘stability’ level; but core CPI rose 2.1% YoY (hotter than the expected 2.0%) and above The Fed’s 2 handle…
Under the hood, weakness in energy prices dominated the downside while used car prices rose more than expected
Both Goods and Services prices picked up in June (with Goods back into positive territory YoY) and Services rise 2.8% YoY…
The firmer inflation readings follow Fed Chairman Jerome Powell’s testimony to lawmakers Wednesday that there’s “a risk that weak inflation will be even more persistent than we currently anticipate.’’
via ZeroHedge News https://ift.tt/2YLzDRy Tyler Durden
As many probably suspected after President Trump said he’d be holding a news conference Thursday about his administration’s response to a string of unfavorable court rulings regarding reintroducing the citizenship question to the census, the president is reportedly planning to issue an executive order to reinstate the question, as he had previously promised to do.
With only months to go until the census begins, and with the census forms already being printed without the question, Trump is carrying on what has become a pet issue for his administration.
The White House will be hosting a very big and very important Social Media Summit today. Would I have become President without Social Media? Yes (probably)! At its conclusion, we will all go to the beautiful Rose Garden for a News Conference on the Census and Citizenship.
NBC News reports that Trump will issue an executive order to add the citizenship question to the census. Trump told reporters on the South Lawn last week that he was “thinking about doing that.”
“It’s one of the ways,” he added. “We have four or five ways we can do it. It’s one of the ways and we’re thinking about doing it very seriously.”
This despite the fact that the Supreme Court ruled late last month that Commerce Secretary Wilbur Ross didn’t provide an adequate reason for why it was necessary to include the question (despite the fact that the question had been included on census forms before President Obama took it off).
The executive order also comes as two federal judges refused to let the DoJ assign a new legal team to the lawsuit that blocked the US from adding the question.
Of course, liberals – who believe the question is an attempt to cow illegals into not participating in the Census – are going to be furious, and more lawsuits to block Trump’s order are almost guaranteed.
via ZeroHedge News https://ift.tt/2G95EM4 Tyler Durden
Former Palm Beach County state’s attorney, Barry Krischer, says that Labor Secretary Alexander Acosta’s account of a 2008 plea arrangement his office cut with pedophile financier Jeffrey Epstein is “completely wrong,” and that Acosta “should not be allowed to rewrite history,” according to a Wednesday statement by Krischer.
Earlier in the day Acosta held a press conference in which he vehemently defended the deal to serve just 13 months in county jail – saying that Krischer would have let Epstein walk otherwise.
“Simply put, the Palm Beach State Attorney’s Office was willing to let Epstein walk free. No jail time. Nothing,” said Acosta. “Prosecutors in my former office found this to be completely unacceptable, and we became involved.”
Not true says Krischer – who said that Acosta abandoned a 53-page federal indictment “after secret negotiations between Mr. Epstein’s lawyers and Mr. Acosta,” according to The Hill.
READ IT HERE: Former Palm Beach (FL) State Atty Barry Krischer challenges Acosta’s characterization of why Acosta pursued a plea deal for Epstein: “I can emphatically state that Mr. Acosta’s recollection of this matter is completely wrong.” pic.twitter.com/0Drs4vetTO
The Miami U.S. Attorney’s Office had prepared a federal indictment against Epstein, but it was never filed. Acosta has also faced criticism for failing to disclose the plea deal to Epstein’s victims, something he said would have jeopardized the agreement.
Krischer downplayed his office’s role in the eventual plea deal, and alleged the U.S. Attorney’s Office abandoned its federal indictment after “secret negotiations between Mr. Epstein’s lawyers and Mr. Acosta.”
“If Mr. Acosta was truly concerned with the State’s case and felt he had to rescue the matter, he would have moved forward with the 53-page indictment that his own office drafted,” Krischer said. –The Hill
That said, Palm Beach police told the Miami Herald that they felt pressured by Krischer to downgrade Epstein’s case to a misdemeanor or to drop it entirely
Palm Beach home of registered sex offender, Jeffrey Epstein. Pedro Portal via the Miami Herald
While Epstein has allegedly victimized up to 60 girls, many of them underage according to the Miami Herald, his sweetheart deal for just two counts of solocitation of prostitution (one with a minor), and included working from his West Palm Beach office for as much as 12 hours a day for up to six days a week. He was also required to register as a sex offender, and was given immunity from federal prosecution.
Acosta avoided mentioning Krischer by name on Wednesday, referring only to the Palm Beach County state’s attorney.
“Everything that the victims have gone through in these cases is horrific, and their response is entirely justified,” said Acosta. “At the same time, I think it’s important to stand up for the prosecutors of my former office and make clear that what they were trying to do was help these victims. They should not be portrayed as individuals that just didn’t care.”
via ZeroHedge News https://ift.tt/2XFcwH7 Tyler Durden
