Tag: finance

A Reddit user who was “surprised” to learn he owed the IRS roughly $50,000 from his crypto-trading profits – money that he had not set aside when he cashed out his bitcoins at the height of the boom – complained in a viral post that crypto trading “ruined his life.”

The alleged trader, who uses the screenname Thoway, explained that he bought eight bitcoins for $7,200 in January 2017 then cashed them out in December for about $120,000. Here’s the catch: his altcoin investments quickly sunk, eating away most of his bitcoin profits. But unbeknownst to him, by selling his bitcoin, Thoway had inadvertently triggered a “taxable event”.

Thoway said his lawyer advised him to cash out his remaining altcoins and give whatever is left to the IRS. Thoway, who has not been identified and has apparently gone “missing” from Reddit since his post went viral, told readers that he earns $47,000 a year as an office assistant.

Thoway’s lawyer said he should be able to set up a payment plan allowing him to pay down the debt over a long-period of time, likely ten years. Still, Thoway complains that, during that period, his tax payments will likely siphon off most of what would’ve been his savings, meaning he has essentially been condemned to live paycheck to paycheck for the foreseeable future because he made a profitable trade, but ignored the tax consequences.

“I feel like I might have accidentally ruined my life because I didn’t know about the taxes,” he said.

While the original post was removed by Reddit for several violations in the comments thread, it’s extremely likely that the anonymous Reddit user isn’t alone in his predicament.

Meanwhile, the April 15 tax deadline appears to be having a far greater impact on the crypto space.

According to Fundstart’s Tom Lee, who anticipated the parabolic runup in crypto prices late last year (and still sees Bitcoin rising to an all time high in 2018) said the April 15 income-tax filing deadline could be contributing to the recent market rout in cryptos. Bitcoin has fallen more than 40% during the past month, and suffered its worst quarter in history. 

According to Lee, similar to Thoway, investors are cashing out to pay their tax bills. According to his calculations, first reported by Bloomberg, every dollar withdrawn from crypto wipes between $20 to $25 from total crypto market value.

More amazing is Lee estimate how much Americans owe the IRS due to the recent Bitcoin price surge: he said that US households had $92 billion in taxable gains from cryptocurrencies in 2017 – roughly 20% of capital-gains tax receipts to the US Treasury.

Which means that the value of crypto-related taxes should be around $25 billion.

Lee, who is hanging on to his bold price target for bitcoin to hit $25,000 by year’s end, believes the selling pressure will soon pass.

“We still like Bitcoin and large-caps,” he said, adding that “while we believe the bear market for alt coins is largely over, we do not see upside for alts until mid-August.”

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Via Dana Lyons’ Tumblr,

After a choppy week, key bull market trendlines are still being tested in many stock indices.

A week ago, we dedicated a blog post to the trendline developments that we posted in our weekly #TrendlineWednesday feature on Twitter. The reason for the unusual post was because of the prolific number of key trendlines being tested at the time in a wide array of indices and stocks. Well, after a volatile week that basically saw the market make little headway, up or down, there has been scant resolution among these trendline tests. Therefore, our #TrendlineWednesday feature is just as prolific as last week’s.

Here are this week’s relevant trendlines that we highlighted (among many other worthy candidates):

 

 

Will these trendlines continue to hold? Only time will tell. In our experience, the more times a trendline is tested, and the more frequently it is tested, the more likely it is to break. However, the proof is in the prices and until proven otherwise, it’s all bend but no break at this point.

*  *  *

If you’re interested in the “all-access” version of our charts and research, please check out our new site, The Lyons Share. You can follow our investment process and posture every day — including insights into what we’re looking to buy and sell and when. Thanks for reading!

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Two weeks ago we reported that in the aftermath of the Cambridge Analytica scandal, first Mozilla, then Germany’s Commerzbank, and a handful of other smaller companies had suspended their Facebook ad campaigns, as advertisers decided to stay away from the radioactive company, at least until the tempest slamming the social media company faded.

Others were more tentative: ISBA, a British group of advertisers that spends hundreds of millions of pounds a year on Facebook, demanded answers. As The Times reported in March, some of ISBA’s 3,000 brands, which include those of the consumer goods companies Unilever and P&G, said they would not tolerate association with Facebook if it emerges that users’ data has found its way into the hands of brokers and political campaigners without authorization. Sources close to the trade body said that if the company’s answers were not satisfactory, advertisers might spend their money elsewhere.

Two weeks later it appears that decisions whether or not to pull ads remain in limbo, even as – according to Facebook COO, Sheryl Sandberg – “a few” advertisers have paused their spending as they wait for the company to answer questions on user privacy.

“We’ve seen a few advertisers pause with us and they’re asking the same questions that other people are asking,” Sandberg said. “They want to make sure they can use data and use it safely.”

However, according to Bloomberg, Sandberg said she is having “reassuring conversations with advertisers, just as we are with people,” about how Facebook has built privacy into its system.

In a wide-ranging interview, Sandberg discussed the company’s shifting responsibilities as it thinks about what can go wrong with its network, following the Cambridge Analytica revelations. She said Facebook is drawing stricter boundaries around its work with certain advertisers and political campaigns, too. The company has worked directly with governments that went on to use the social network against their people, and advertisers that ran anti-Muslim content, for example.

Facebook will continue to work with political advertisers, and will still aim to be “neutral” when assessing content — just more careful, Sandberg said.

But more importantly for Facebook, and perhaps the best indication that the storm for Zuckerberg & Co. has now passed, DataTrek’c Nick Colas found that the outrage over Facebook is now over. Specifically, Colas was looking at Google search data for “Delete Facebook” since the issues started, and found that the company has not seen any “meaningful impact” in its usage or business. Specifically:

• While searches for the term did spike from March 18 to March 20, they are already most of the way back down to “normal” levels. It has been 18 days since “Delete Facebook” saw a large increase in search interest, and as of this past weekend search volumes were less than half what they were at their peaks in mid March.
• Areas in the US with the most incremental interest in the term are lower-population states such as West Virginia, Montana, Maine, Alaska and North Dakota. Zoom in on high population states such as California, New York and Texas and you will find that “Delete Facebook” searches are entirely back to pre-crisis levels.
• At its peak of Google search interest, “Delete Facebook” was as popular as “Kim Kardashian”. Now, Kim is back in the lead with a 2:1 advantage and climbing.
• Also more popular than “Delete Facebook”: “Pizza” (65x more), “CNBC” (2x, although it was close for a few days), and “Game of Thrones” (3x, and the show hasn’t been on for a while).

Bottom line: unless there are a lot more revelations coming, #deletefacebook is #over.

It also means that for all the advertisers’ virtue signalling, and for all Facebook promises that it will change the way it conducts business, just a few weeks after Zuckerberg testifies before Congress next week in yet another kangaroo court which achieves nothing, things will quietly go back to just the way they were, with Facebook collecting billions in “ad” revenue in exchange for selling all of your personal data to the highest bidders.

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More than 60,000 Americans are expected to die this year from drug overdoses as powerful synthetic opioids like fentanyl-laced heroin cause drug-related deaths to skyrocket. So far, the Trump administration’s boldest proposal to combat the epidemic has been revising DOJ rules to allow prosecutors to seek the death penalty in some drug cases.

With that in mind, the results of a recent study published this week might be of interest: The study, published by an independent team of researchers in JAMA Internal Medicine, is the latest to suggest that expanding medical marijuana could help lower rates of opioid abuse, NPR reported.

Medical marijuana appears to have put a dent in the opioid abuse epidemic, according to two studies published Monday.

The research suggests that some people turn to marijuana as a way to treat their pain, and by so doing, avoid more dangerous addictive drugs. The findings are the latest to lend support to the idea that some people are willing to substitute marijuana for opioids and other prescription drugs.

Many people end up abusing opioid drugs such as oxycodone and heroin after starting off with a legitimate prescription for pain. The authors argue that people who avoid that first prescription are less likely to end up as part of the opioid epidemic.

“We do know that cannabis is much less risky than opiates, as far as likelihood of dependency,” says W. David Bradford, a professor of public policy at the University of Georgia. “And certainly there’s no mortality risk” from the drug itself.

As the study reports, many opioid abusers first encounter the drug as a prescribed treatment for pain, after a surgery or due to a chronic condition or some other circumstance. According to the scientists, by presribing medical marijuana for pain, instead of opioids, the rate of opioid dependence will fall. The National Academy of Sciences, Engineering and Medicine believes there’s some evidence that cannabis can effectively treat pain – at least in some conditions.

The researchers used data from Medicare, which mostly covers people over the age of 65 (and was the most convenient set of data to work with, being freely available), and found a 14% drop in opioid prescriptions in states that allow easy access to medical marijuana.

In terms of the number of pills made available by doctors, the reduction was quite significant.

They estimate that these dispensary programs reduced the number of opioid prescriptions by 3.7 million daily doses. States that allowed homegrown marijuana for medical use saw an estimated 1.8 million fewer pills dispensed per day. To put that in perspective, from 2010 to 2015 Medicare recipients received an average of 23 million daily doses of opioids, the researchers say.

Because opioid use nationwide was rising during the study period, their estimate of reduced uses reflects a slowing of the increase, rather than an actual decline in opioid use in these states, Bradford says.

To be sure, the dataset used in the study merely shows a correlation between the two; the researchers did’t have enough information to examine the relationship with greater scrutiny. Still, their report suggests that expanding medical marijuana should lead to a nationwide reduction in prescriptions for opioids.

A different study at the University of Kentucky recently came to a similar conclusion regarding the relationship between medical marijuana and opioids. One of the researchers noted that expanding access to marijuana doesn’t have some risks.

Hefei Wen at the University of Kentucky College of Public Health was lead author on another study in the same journal that reached similar conclusions. Wen, with Jason Hockenberry at Emory University, used Medicaid data. Medicaid is primarily a health insurance program for low-income people.

The authors write that laws that permit both medical marijuana and recreational marijuana for adults “have the potential to reduce opioid prescribing for Medicaid enrollees, a segment of population with disproportionately high risk for chronic pain, opioid use disorder and opioid overdose. Nevertheless, marijuana liberalization alone cannot solve the opioid epidemic.”

Bradford agrees that medical marijuana laws could have a role to play. “But it is not without risks,” he says. “Like any drug in our FDA-approved pharmacopeia, it can be misused. There’s no question about it. So I hope nobody reading our study will say ‘Oh, great, the answer to the opiate problem is just put cannabis in everybody’s medicine chest and we are good to go.’ We are certainly not saying that.”

To prove that medical marijuana really can replace opioids as a viable pain-management option, the authors of the study said researchers will need to follow and examine individuals to see how marijuana affects them.

Like most other developed countries, the US’s rapidly aging population will soon be needing massive quantities of pain medication, which makes finding a viable pain-management substitute for opioids all the more urgent.

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Authored by Elizabeth Lea Vos Via Disobedient Media

Over the last few months, Professor Joseph Mifsud has become a feather in the cap for those pushing the Trump-Russia narrative. He is characterized as a “Russian” intelligence asset in mainstream press, despite his declarations to the contrary. However, evidence has surfaced that suggests Mifsud was anything but a Russian spy, and may have actually worked for British intelligence. This new evidence culminates in the ground-breaking conclusion that the UK and its intelligence apparatus may be responsible for the invention of key pillars of the Trump-Russia scandal. If true, this would essentially turn the entire RussiaGate debacle on its head.

To give an idea of the scope of this report, a few central points showing the UK connections with the central pillars of the Trump-Russia claims are included here, in the order of discussion in this article:

1. Mifsud allegedly discussed that Russia has ‘dirt’ on Clinton in the form of ‘thousands of emails’ with George Papadopoulos in London in April 2016.
2. The following month, Papadopoulos spoke with Alexander Downer, Australia’s ambassador to the UK, about the alleged Russian dirt on Clinton while they were drinking at a swanky Kensington bar, according to The Times. In late July 2016, Downer shared his tip with Australian intelligence officials who forwarded it to the FBI.
3. Robert Goldstone, a key figure in the ‘Trump Tower’ part of the RussiaGate narrative, sent Donald Trump Jr. an email claiming Russia wanted to help the Trump campaign. He is a British music promoter.
4. Christopher Steele, ex-MI6, who worked as an MI6 agent in Moscow until 1993 and ran the Russia desk at MI6 HQ in London between 2006 and 2009. He produced the totally unsubstantiated ‘Steele Dossier’ of Trump-Russia allegations, with funding from the Clinton campaign and the DNC.
5. Robert Hannigan, the head of British spy agency GCHQ, flew to Washington DC to share ‘director-to-director’ level intelligence with then-CIA Chief John Brennan.

Each of these strands of UK-tied elements of the Russiagate narrative can be substantially dismantled on close inspection. This untangling process leads to the surprising conclusion that UK intelligence services fabricated evidence of collusion in order to create the appearance of a Trump-Russia connection.

This trend begins with Joseph Mifsud, a Maltese scholar with an eclectic academic history who Quartz described as an “enigma,” while legacy press has enthusiastically characterized him as a central personality in the Trump-Russia scandal. The New York Times described Mifsud as an “enthusiastic promoter of President Vladimir V. Putin of Russia”, citing his regular involvement in the annual meetings of the Valdai Discussion Club, a Russian-based think-tank, as well as three short articles he wrote in support of Russian policies.

Mifsud strongly denied claims that he was associated with Russian intelligence, telling Italian newspaper Repubblica that he was a member of the European Council on Foreign Relations and the Clinton Foundation, adding that his political outlook was “left-leaning.” Last month, Slate reported Mifsud had ‘disappeared’, as did some of the other figures linking the UK to the Trump-Russia scandal. This aspect will be discussed in more detail below.

To contextualize Mifsud’s eclectic academic career in terms of intelligence service, it is helpful to note that research undertaken by this author and Suzie Dawson as part of the Decipher You project has repeatedly shown the close ties – an outright merger in many cases – between the intelligence community and academia. This enmeshment also takes place with think-tanks, NGOs, and in the corporate sphere. In this light, Mifsud’s brand of ‘scholarship’ becomes far less mysterious.

Mifsud’s alleged links to Russian intelligence are summarily debunked by his close working relationship with Claire Smith, a major figure in the upper echelons of British intelligence. A number of Twitter users recently observed that Joseph Mifsud had been photographed standing next to Claire Smith of the UK Joint Intelligence Committee at Mifsud’s LINK campus in Rome. Newsmax and Buzzfeed later reported that the professor’s name and biography had been removed from the campus’ website, writing that the mysterious removal took place after Mifsud had served the institution for “years.”

WikiLeaks Editor-in-Chief Julian Assange likewise noted the connection between Mifsud and Smith in a Twitterthread, additionally pointing out his connections with Saudi intelligence: “[Mifsud] and Claire Smith of the UK Joint Intelligence Committee and eight-year member of the UK Security Vetting panel both trained Italian security services at the Link University in Rome and appear to both be present in this [photo].”

The photograph in question originated on Geodiplomatics.com, where it specified that Joseph Mifsud is indeed standing next to Claire Smith, who was attending a: “…Training program on International Security which was organised by Link Campus University and London Academy of Diplomacy.” The event is listed as taking place in October, 2012. This is highly significant for a number of reasons.

First, the training program Smith attended with high-ranking members of the Italian military was organized by the London Academy of Diplomacy, where Joseph Mifsud served as Director, as noted by The Washington Post. That Claire Smith was training military and law enforcement officials alongside Mifsud in 2012 during her tenure as a member of the UK Cabinet Office Security Vetting Appeals Panel, which oversees the vetting process for UK intelligence placement, strongly suggests that Mifsud has been incorrectly characterized as a Russian intelligence asset. It is extremely unlikely that Claire Smith’s role in vetting UK intelligence personnel would lead to her accidentally working with a Russian agent.

The connection between Mifsud and Smith does not end at bumped elbows in a photograph. Mifsud’s LinkedIn profile lists the University of Stirling as a place of occupation in connection with his service as Director of the London Academy of Diplomacy (LAD), where Claire Smith served as a visiting professor from 2013-2014 according to her LinkedIn profile. This adds yet another verifiable connection between a man who is at the center of already-flimsy Trump-Russia allegations and a high-ranking British intelligence figure.

Claire Smith also hosted a seminar titled “Making Sense of Intelligence” at the University of Stirling. The event registration form describes her career, including her service as Deputy Chief of Assessments Staff in the Cabinet Office, as a member of the UK Joint Intelligence Committee and her completion of an eight-year term as a member of the UK Security Vetting and Appeals Panel.

A particularly compelling factor indicating that Mifsud’s working relationship with Claire Smith suggests his direct connection with UK intelligence is Smith’s membership of the UK’s Joint Intelligence Committee (JIC), a supervisory body overseeing all UK intelligence agencies. The JIC is part of the Cabinet Office and reports directly to the Prime Minister. The Committee also sets the collection and analysis priorities for all of the agencies it supervises. Claire Smith also served as a member of the UK’s Cabinet Office.

In summary, Mifsud’s appearance with Claire Smith at the LINK campus, in addition to her discussion on intelligence at yet another university where Mifsud was also employed, as well as her long-standing role in UK intelligence vetting and her position as a member of the UK Joint Intelligence Committee, would suggest that the roving scholar is not a Russian agent, but is actually a UK intelligence asset. The possibility that such a high-ranking member of this extremely powerful intelligence supervisory group was photographed standing next to a “Russian” asset unknowingly is patently absurd. This finding knocks the first pillar out from under the edifice of the Trump-Russia allegations. It provides an initial suggestion of the UK’s involvement in procuring the ‘evidence’ that fueled the debacle.

Claire Smith is not the only British official associated with Mifsud. He was a speaker at an event by the Central European Initiative alongside former British diplomat Charles Crawford, whose postings included Moscow, Sarajevo, Belgrade and Warsaw. Crawford is listed as a visiting Professor with the same London Academy of Diplomacy (LAD) where Mifsud served as Director, associated with Stirling University. This adds more weight to the idea that Mifsud is a familiar figure among the upper echelons of the UK intelligence and foreign policy establishment.

The final nail in the coffin of the theory that Mifsud is a Russian spy is this photograph of Mifsud standing next to Boris Johnson, the UK Foreign Secretary, as reported by The Guardian. The photograph, taken in October 2017 – nearly a full year after the US Presidential election and nine months after Mifsud’s name appeared in newspaper headlines worldwide as allegedly involved in Russian meddling in that election – is either highly embarrassing for the hapless Mr Johnson, or it’s not, because Joseph Mifsud is actually a valued and security-vetted asset to the United Kingdom.

Another aspect of the RussiaGate claims tied to the UK includes the reported conversation between George Papadopoulos and Alexander Downer, Australia’s High Commissioner to the UK who was based in London. The pair reportedly spoke about the alleged Russian ‘dirt’ on Hillary Clinton while they were drinking at a swanky bar in London. According to Lifezette, Downer is closely tied with The Clinton Foundation via his role in securing $25 million in aid from his country to help the Clinton Foundation fight AIDS.

He is also a member of the advisory board of London-based Hakluyt & Co, an opposition research and intelligence firm set up in 1995 by three former UK intelligence officials and described as “a retirement home for ex-MI6 [British foreign intelligence] officers, but it now also recruits from the worlds of management consultancy and banking”. Whereas opposition research group Fusion GPS has received all the media attention so far, Lifezette states that Hakluyt is “a second, even more powerful and mysterious opposition research and intelligence firm… with significant political and financial links to former Secretary of State Hillary Clinton and her 2016 campaign”.

Yet another UK link to a central pillar of the Trump-Russia narrative is British music promoter Robert Goldstone, who was reported to have organized a meeting between Donald Trump Jr. and Russian nationals in June 2016. In the email chain setting up the Trump Tower meeting, both before and after the meeting, the only real ‘evidence’ of collusion with Russia come from Goldstone’s own emails; none-too-subtle heavy hints about ‘Russian help’ dropped by Goldstone but later – after the emails became public – walked back by him as “hyping the message and… using hot-button language to puff up the information I had been given.”

Some have speculated that Goldstone was also involved with British or US intelligence efforts to concoct the RussiaGate narrative. As soon as his name emerged in the press, Goldstone – like Christopher Steele and Joseph Mifsud – went into ‘hiding’. Multiple press reports claimed he had done so out of fear for his safety, a claim also made about Christopher Steele when his name first became public. Indeed, the UK government issued a DA Notice(a press suppression advisory notice) to the British press to suppress the ex-spy Steele’s name. It is notable that, of all the people swept up into the ever-burgeoning RussiaGate investigation, it is only the UK-linked witnesses – Mifsud, Steele, Goldstone – who have felt the need to go into hiding when their role has been exposed.

The New York Times summed up the contents of Christopher Steele’s dossier: “Mr. Steele produced a series of memos that alleged a broad conspiracy between the Trump campaign and the Russian government to influence the 2016 election on behalf of Mr. Trump. The memos also contained unsubstantiated accounts of encounters between Mr. Trump and Russian prostitutes, and real estate deals that were intended as bribes.”

Press reports also relate that Steele was ordered by an English court to appear for a videotaped deposition in London as part of an ongoing civil litigation against Buzzfeed for publishing the unverified dossier, for which Steele was paid $168,000 by Glenn Simpson’s company Fusion GPS, who were in turn paid by Mark Elias of law firm Perkins Coie, lawyers to both the Hillary Clinton campaign and the DNC.

In his thread on the role of UK intelligence interference in the 2016 US Presidential race, Assange also noted how Christopher Steele used another former UK ambassador to Moscow, Sir Andrew Wood, to funnel the dossier to Senator John McCain in a way that moved the handover out of London, to Canada. It’s often said that no one ever really leaves the UK security services  when they retire – many ‘former’ MI6 or MI5 officers’ private intelligence businesses are dependent on maintaining good contacts among their ex-colleagues – so it is interesting to note that Sir Andrew Wood says he was “instructed” — by former British spy Christopher Steele — to reach out to the senior Republican, whom Wood called “a good man,” about the unverified document.

Lastly, Robert Hannigan, former head of British intelligence agency GCHQ, is another personality of note in the formation of the RussiaGate narrative and its surprisingly deep links to the UK. The Guardian noted that Hannigan announced he would step down from his leadership position with the agency just three days after the inauguration of President Trump, on 23 January 2017. Jane Mayer in her profile of Christopher Steele published in the New Yorkeralso noted that Hannigan had flown to Washington D.C. to personally brief the then-CIA Director John Brennan on alleged communications between the Trump campaign and Moscow. What is so curious about this briefing “deemed so sensitive it was handled at director-level” is why Hannigan was talking director-to-director to the CIA and not Mike Rogers at the NSA, GCHQ’s Five Eyes intelligence-sharing partner.

The central supporting pillars of the RussiaGate allegations hinge on figures with close ties to British intelligence and UK nationals. Even establishment media like The Guardian reported that British spies from GCHQ were the first to alert US authorities to so-called Russian interference. Did the entire narrative originate with UK intelligence groups in an effort to create the appearance of Russian collusion with the Trump Presidential campaign, much as the Guccifer 2.0 persona was used in the US to discredit WikiLeaks’ publication of the DNC emails?

If it was not Russia at the heart of a complex operation to topple the Clinton campaign in 2016, then was British Intelligence responsible for creating false narratives and mirage-like ‘evidence’ on which the Trump-Russia scandal could hinge?

Put another way, if UK intelligence is responsible for manufacturing the Trump-Russia allegations, it suggests that the UK’s efforts formed an international arm running concurrently with domestic US ‘Deep State’ efforts to sabotage Trump’s presidential campaign and/or oust him once he had been elected.

Is British intelligence involvement in RussiaGate, as outlined above, the international version of CrowdStrike and former FBI figures manufacturing the Guccifer 2.0 persona specifically to smear WikiLeaks via false allegations of a Russian hack of the DNC? Have we been looking in the wrong place – at the wrong country – to unearth the so-called ‘foreign meddling’ in the 2016 US election all along?

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A body pulled from the Chattahoochee river is that of an Atlanta researcher for the Centers for Disease Control (CDC) who went missing in mid-February, Atlanta police reported on Thursday.

Timothy Cunningham, 25, was last seen February 12 after he left work midway through the day due to an illness, prompting his friends and family to sound the alarm. 

Terrell Cunningham, 60, said his son’s supervisor told him that Commander Cunningham had reported for work but that he had left midday because he wasn’t feeling well. –NYT

The family of Timothy J. Cunningham, 35, grew concerned after the Harvard-trained epidemiologist and US Navy officer wouldn’t answer texts or calls. Driving over 600 miles from Maryland to Atlanta, Cunningham’s parents gained access to his house where they found their son’s phone, wallet and driver’s license.

Quoted by the NYT, his father said that Commander Cunningham had “a lot going on” personally and professionally, and his most recent conversation with his son had left him worried.

“The tone, and the numerous exchanges gave us reason to be concerned about Tim,” said Terrell Cunningham. “And I don’t know if it’s an instinct you have because it’s your child, but it was not a normal conversation and I was not comfortable.”

Cunningham’s car was parked in the garage, while his dog – Mr. Bojangles, aka Bo, was left all by himself. 

“Tim never leaves Bo unattended,” Terrell Cunningham told NBC News. “He just doesn’t do it.”

“None of this makes sense,” Timothy’s brother Anterio told Atlanta Fox affiliate WAGA-TV. “He wouldn’t just evaporate like this and leave his dog alone and have our mother wondering and worrying like this. He wouldn’t.”

“I feel like I’m in a horrible Black Mirror episode,” Cunningham’s sister Tiara told the New York Times. “I’m kind of lost without him, to be quite honest.”

Tiara was the last family member to speak with Timothy Cunningham before his disappearance – who said the last time they spoke her brother “sounded not like himself.” When she texted him a bit later, she didn’t get a response – nor did the rest of the Cunningham family.

Atlanta police said Cunningham had been upset over not receiving a promotion – however the CDC later retracted that information, stating that he had in fact recently received one.

Cunningham – who was promoted to commander in the US Public Health Service last July, had worked on the government’s response to both Zika and Ebola outbreaks. With two degrees from Harvard’s School of Public Health, he had been named one of The Atlanta Business Chronicle’s “40 under 40” award winners.

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Submitted by Nick Colas of DataTrek Research

Sometimes bad news defines stock prices more than good, so today we outline the overarching bear case for each major US industry sector. Despite all the negative headlines, the case for Tech isn’t as bad as you think. And Financials… Aside from still low long rates, not much bad there either.

Like many colorful English-language phrases, “Pick your poison” started in a tavern somewhere. Poison was slang for liquor, so bar keeper queries like “What’s your poison, mister?” were common enough. Add a little alliteration for zest, and you get the finished product.

It is also a very useful paradigm for thinking through US equity sectors allocations. Such is the squirrely nature of stock markets lately that we think investors have shifted their thinking from “Where’s the best upside?” to “Which sector’s poison is the least likely to kill my portfolio?”

At first blush this may seem like a simple observation, but it has a few useful offshoots:

• First, the sector with the weakest poison will tend to outperform in a down market. As stock prices continue to churn (and they will), less noxious groups will see incremental money flows and plenty of buzz for their defensive attributes. You just have to pick the sectors whose stories will seem the “least bad” to other investors in 30-180 days, depending on your holding period.
• Second, by explicitly considering just the downside case for a group we can assess what amount of bad news might prove lethal. “The dose makes the poison” is a millenniums-old saying, and it applies here. Every investment has its yin and yang, and prices move dramatically only when they fall out of balance.

Running through the various major sectors of the S&P 500 and their respective poisons, we get this:

Technology Poisons:

• Regulatory risk. The problem here is one of dosage. Super cap tech stocks have the lightest ratio of regulation to market capitalization of any sector in modern history. Even small amounts of lawmaking will seem dramatic.
• But ultimately what draws margin-killing regulation is 1) public health and 2) public wealth. Tech, broadly defined, is far enough away from those two factors to limit regulation’s ability to stymie its growth. Yes, self-driving cars touch on #1 – they will have a tougher road. But software, social networks, and hardware avoid breaching those criteria.
• Weak Corporate Governance. Founder-controlled companies have been socially unresponsive entities since Henry Ford tried to bust the UAW in the 1930s, and at least his company was still private at the time. Facebook’s current challenges are a reminder that corporate boards can do very little to force managerial change when the person at the head of the table owns more than half the votes.
• Higher Interest Rates/Valuation. Rising interest rates are typically kryptonite to richly valued companies. That’s just the math of a DCF model, and a clear problem for Tech if rates spike suddenly.

Our take: we remain positive on Technology, even if it is no longer an easy trade. None of these poisons are enough to kill the patient. Make them sick, yes… We’ve seen that. But none are deadly. Of the three, rates worry us the most since there’s no getting around the math. Still, the offset is a hopefully stronger global economy in a rising rate environment.

Industrials/Transports and Materials Poisons

• Trade Policy. This lethality of this poison comes down, again, to dosage. If you believe (as we do) that the current tariff debate is political theater, then their unhealthy effects on these sectors’ stock prices will be temporary. If you believe the world is cycling into an all out trade war, then this group is done for a while. And so are equities generally.
• Labor Costs. This is relevant to many individual companies in these sectors since they still tend to carry large employment rolls. At the same time, rising wages also helps spur consumer demand and therefore provide a partial offset. On top of that, direct labor costs are seldom more than 30% of an industrial company’s cost structure.

Our take: the current trade dust-up may be more symbolic than real, but these groups will bear the brunt of market unease on the topic. To overweight the group is to rely on markets seeing through the headlines and not get caught up in the hype. The market’s YTD record on that point is mixed, at best. Without the benefit of an infrastructure bill to bolster investor confidence, this group feels like an even-weight or even an underweight.

Energy Poisons

• Commodity prices. The Energy sector is one of the worst performing groups YTD, despite the fact that WTI is up 5.6% in 2018. That tells us equity investors don’t trust the rally in oil prices.

Our take: we really want to like this group, if only because the “Poison” seems so innocuous. Energy has a long history of decoupling from commodity fundamentals, only to rejoin them suddenly. FactSet shows the sector having the best earnings comps for Q1 of any industry group. That makes this group an even weight, or better if one has the stomach to own a distinct market laggard.

Health Care Poisons

• Amazon/Berkshire/JP Morgan. The chilling effect on the Health Care group from this trio announcing a JV in the space has been remarkable. From January 30th, the day the news broke, to today the sector is down 8.5%. Technology, which has seen much more negative news flow, is only 3.7% lower over the same period.

Our take: if sentiment on the group can be so roughed up by this news, what will happen when AMZN/BRKA/JPM name a CEO? Apparently that’s in the works with some very senior attention from Berkshire and veteran VC investor John Doerr. This is some strong poison indeed…

Rate Sensitive Groups (Utilities, REITs, Consumer Staples, Telecomm) Poisons

• Higher Interest Rates. Pretty obvious, but for the sake of completeness we will cover it. All these groups have underperformed this year as long-term interest rates have risen.

Our take: our recent DataTrek investor survey showed remarkable conviction that the US 10 Year Treasury would end the year with a yield of between 3.0% and 3.25%. We agree with that assessment. And against that backdrop, it is hard to like any of these groups. Prudence says an “even weight” position in large sectors like Staples and  Utilities is the wise approach, just in case the crowd is very, very wrong.

Consumer Discretionary Poisons

• Amazon and Netflix. Consumer Discretionary stocks have posted a solid 2018 thus far (up 2.9%), but only because Amazon is +21% on the year and Netflix is 51% higher YTD. Amazon (a 20% weighting) has added 420 basis points of performance, and Netflix (4.4% weighting) has been good for 150 bp more. In aggregate, everything else in this group is down 2.8% on the year and underperforming the S&P 500.

Our take: if you want to own Amazon, just own Amazon; the same goes for Netflix. If your investment approach is to just pick sectors, then you still need to own this group. This is one of those cases where the antidote – underweighting a group with important leadership names – may be worse than the poison (a very chunky sector in terms of single name risk).

Financials Poison

• US Treasury Yield Curve. Financials have held their own this year, down 1.0% versus the S&P 500’s -1.2% price return. Holding them back: a narrowing spread between short and long term rates.

Our take: even in the last few days of market turmoil, long term Treasury rates held in at 2.72%. That is well above where they started the year (2.45%) and shows that even in a “Flight to quality” selloff there still isn’t much appetite to own long dated government paper. This gives us some confidence that long-term interest rates will continue their generally upward trajectory in 2018. Financials should be pulled higher in their wake

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Having realized (perhaps) that taking China one on one will be difficult, not to mention lead to major stock market losses, Trump has decided to spread the pain, and is quietly building an army coalition of nations to join the US in the trade war against China. The first stop: Latin America.

Trump is due to make his first visit to the region next week to attend the Summit of the Americas in Lima, Peru, a trip which comes as his administration is waging a trade battle with China on one front and and pushing to overhaul NAFTA on the other.  While there, Trump will make the case case that the US – and not China – should be the trade “partner of choice” for Latin America, a senior administration official said on Thursday told Reuters.

“President Trump has been very clear … in terms of his economic policies that the Chinese economic aggression in the region has not been productive for the hemisphere and that the United States should remain the partner of choice for them,” the official told reporters on a conference call.

Trump will deliver an address to the summit where he will talk about “shared values” in the hemisphere and the need to reduce drug trafficking, the official said. Substantive discussions on NAFTA are not expected at the summit, the official said.

Ironically, the trip also comes as Trump has been raging against migration from the region, having recently successfully halted a “migrant caravan” from Guatemala headed for the US in hopes of obtaining asylum. It was unclear how much emphasis Trump would place on stopping illegal immigration from the region into the United States – one of his main promises in his presidential run for office, and a very sensitive topic for those present. Surely, some form of quid-pro-quo will be unveiled, as in Latin America may side with the US against China but only if Trump agree to accept a given number of migrants.

* * *

Separately, earlier on Thursday Larry Kudlow confirmed that Trump is indeed building an army ahead of the big showdown with China. According to Bloomberg, Kudlow wants to rally “pro-market allies to push back against China’s unfair trade practices,” a senior White House adviser said.

“The damage of our economy comes from China’s restrictive practices. Blame China. They’ve been doing this for decades. Don’t blame Trump,” Larry Kudlow, head of the White House’s National Economic Council, told reporters in Washington.

In threatening to punish China for its abuse of intellectual property, Trump is “doing what everyone in the world has said we should do,” said Kudlow, adding that the administration will have more to say about its efforts to recruit other major economies to support the U.S. position.

“I call it a trade coalition of the willing. I think everybody in the world knows that China has not played by the rules  for many years,” he said.

As reported earlier, for a second straight day Kudlow sought to reassure investors about Trump’s plan to impose tariffs on $50 billion worth of Chinese products. Kudlow emphasized that the tariffs haven’t been enacted, and the administration will consult with a range of parties, including U.S. lawmakers, the agriculture industry and the Chinese government itself. Overnight, China said Tuesday it prefers to negotiate a solution, but isn’t afraid to retaliate if the U.S. duties take effect. “It’s nothing around the corner. There’s going to be big discussion about it,” Kudlow said.

Perhaps, but according to the Chinese press, China has already won the “Trade Wars“, which suggests that the only retreat possible is if Trump admits defeat, which knowing the president appears very unlikely, which in turn makes it very likely that the ongoing euphoric burst which has sent the Dow Jones 1000 points higher in the past 2 days will not last long.

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Seemingly undeterred by the recent outrage over tech giants’ abusing their access to personal privacy, a recent patent filed by Amazon with the US Patent and Trademark Office (USPTO) has unveiled a new artificial intelligence system that could be embedded in an array of Amazon devices to analyze all audio in real time for specific words.

Amazon calls the technology “Keyword Determinations From Conversational Data,” otherwise known as a ‘voice sniffer algorithm,’ and this could be the next giant leap towards expanding mass home surveillance of consumers’ private lives.

This pending patent application shows how Amazon could use consumers’ home data collected and stored on servers “to draw disturbing inferences about households, and how the company might use that data for financial gain,” said the Consumer Watchdog, a nonprofit advocacy group in Santa Monica, Calif.

“The more words they collect, the more the company gets to know you,” Daniel Burrus, a tech analyst with Burrus Research Associates, Inc., told ABC News. “They are building a personality profile on the user.”

Currently, Amazon devices operate in a “listening” mode only and can be activated via user commands, such as “Alexa” or “Hello Alexa.” As far as we know, Amazon devices do not record conversations, as they only listen to commands after the user initiates a trigger word.

However, within the foreseeable future, Amazon devices could record all conversations — even without a trigger word to wake up the device, along with creating a corporate profile of the end user for “commercial purposes.”

Always on, Always listening.

The patent explains how the “voice sniffer algorithms” are designed to monitor certain keywords like, “prefer” and “bought,” or other words such as “hate” or “disliked,” and then the device can “capture adjacent audio that can be analyzed.”

According to the patent, ”the identified keywords can be stored and/or transmitted to an appropriate location accessible to entities such as advertisers or content providers who can use the keywords to attempt to select or customize the content that is likely relevant to the user,” reports ABC News.

ABC News does not mention, but we will throw this out there, government agencies could also acquire the data from Amazon.

Kiran Edara, a senior manager of software development at Amazon, who wrote the abstract for the patent, provides an easy to understand overview of it:

“Topics of potential interest to a user, useful for purposes such as targeted advertising and product recommendations, can be extracted from voice content produced by a user. A computing device can capture voice content, such as when a user speaks into or near the device. One or more sniffer algorithms or processes can attempt to identify trigger words in the voice content, which can indicate a level of interest of the user. For each identified potential trigger word, the device can capture adjacent audio that can be analyzed, on the device or remotely, to attempt to determine one or more keywords associated with that trigger word. The identified keywords can be stored and/or transmitted to an appropriate location accessible to entities such as advertisers or content providers who can use the keywords to attempt to select or customize content that is likely relevant to the user.”

Burrus told ABC News, Amazon could offer “personalized offers on products, encourage [a user] to take action, or better persuade someone to buy a product.”

ABC News said the pending patent could even offer your private data to “friends of the user for gift buying” purposes. Nevertheless, the patent is pending, and there could still be a chance the USPTO does not approve it.

“The patent has not yet been approved by the United States Patent and Trademark Office (USPTO), and tech companies often file hundreds, if not thousands of patents a year. However, not every patent is approved by the USPTO. Amazon was granted 1,963 patent applications in 2017, which was an 18 percent increase from the year before when they were awarded 1,672 patents, according to data from the USPTO analyzed by IFI Claims Patent Services, a company that provides patent data services.”

Daniel Ives, a tech analyst with GBH Insights, indicates Alexa’s intelligence would rapidly increase if the pending patent was to be implemented in devices, because the algorithms would have unlimited reign on a consumer’s personal life.

“This further builds on Alexa and more data intelligence and analysis through voice that is a major initiative for Amazon,” he said. “This algorithm would possibly feed from Alexa into the rest of the Amazon consumer flywheel, ultimately helping drive purchasing and buying behavior of Prime members.

The patent gives examples, including, “… in sentences such as ‘I love skiing’ or ‘I like to swim’ the words ‘like’ and ‘love’ could be examples [of] trigger words indicating a level of interest.”

Peter Kent, an e-commerce consultant and expert witness on internet technology patents, told ABC News:

However, the patent does say that “a user can have the option of activating or deactivating the sniffing or voice capture processes, for purposes such as privacy and data security,” and users must indicate a “willingness to have voice content analyzed” for the trigger-word algorithms to work. The patent may also allow video cameras on devices to “capture image information to attempt to determine which user is speaking.”

In a statement, an Amazon spokesman told ABC News the technology company takes the privacy of its customers “seriously.”

“We take privacy seriously and have built multiple layers of privacy into our devices. We do not use customers’ voice recordings for targeted advertising,” the Amazon spokesman said in the statement. “Like many companies, we file a number of forward-looking patent applications that explore the full possibilities of new technology. Patents take multiple years to receive and do not necessarily reflect current developments to products and services.”

Ironic: Facebook’s Mark Zuckerberg said the same thing before getting caught doing the opposite.

So while Amazon’s voice triggered devices offer some convenience, they also offer the corporate clients of Amazon unprecedented insight into the customers’ private lives, the same way when Facebook wins an ad contract, it is selling the client all of your personal information in the process. Meanwhile, unable to respond to this onslaught of in home eavesdropping, America finds itself in the latter stages of the disappearance of individual privacy.

And with tech giants symbiotically linked to the US government, the Fourth Amendment is almost null and void, which with the ongoing crackdown against the 1st and 2nd amendments, will assure that in just a few years the corporate takeover of the country – whose residents which have voluntarily ceded over their most sacred rights – will be complete.

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In what may be its grandest – if most hollow – virtue signaling gesture to date, BlackRock is planning to strip shares of major gun retailers like Wal-Mart, Dick’s Sporting Goods and Kroger from several “environmental social and governance focused funds” as the world’s largest asset manager races to cash in on the market for ESG products, which have been rapidly growing in popularity.

Effectively BlackRock is offering is offering gun-free versions of IWM and AGG. Why? So that even more people will buy its segmented, “socially responsible” products of course and feel good about themselves, while making sure that Larry Fink’s 2018 bonus is an all time high.

Even though Wal-Mart, Dick’s and other retailers raised the age limit for buying assault rifles to 21, among other measures, in the wake of the Valentine’s Day massacre at Marjorie Stoneman Douglas High School in Parkland, Fla., the Wall Street Journal reported that BlackRock will exclude these retailers on the basis that haven’t stopped selling guns altogether. Shortly after the shooting, BlackRock said it would speak with weapons manufacturers to “understand their responses” to the second-deadliest public school shooting in US history.

As Bloomberg further explains, the iShares MSCI USA Small-Cap ESG Optimized ETF, which will start trading on or about April 12, will track investment results of an index that is mostly made up of small-cap U.S. companies. BlackRock also filed an initial registration statement for the iShares ESG US Aggregate Bond ETF. Both ETFs will exclude producers and big retailers of civilian firearms.

While the asset manager is planning to offer a suite of new ESG products, its existing offerings have a total of $2.2 billion AUM – a paltry sum compared with the company’s $6 trillion AUM.

BlackRock plans to strip all gun sellers and retailers including Kroger from its current lineup of seven so-called ESG funds, which have some $2.2 billion in assets. Those products had minimal exposure to such firms.

It is also planning to offer new ETFs and pooled funds to 401(k) retirement savings plans that exclude gun makers and retailers. One of those ETFs will track the performance of a new bond index that is similar to the Bloomberg Barclays US Aggregate Bond Index, but excludes issuers that make 5% or more or $20 million in revenue from gun-related products.

Furthermore, while BlackRock’s leaders would prefer its customers to interpret this as a noble example of corporate activism, there’s at least one ulterior motive that we can see: Publicly-traded weapons makers are struggling in the Trump era amid a slump in gun sales (many assume that Trump will protect their second amendment rights at all costs, and therefore there is no longer the same urgency to stock up on weapons that existed during the Obama era).

And while one might’ve expected the shooting to lead to renewed interest in these stocks (a pattern typically observed during the Obama era), both Sturm Ruger and American Outdoor Brands – the holding company of Smith & Wesson – have struggled in the wake of the Parkland shooting. Meanwhile, Remington, America’s second-largest gunmaker, recently filed for bankruptcy.

And when it comes to gun retailers – even giant companies like Walmart – Trump’s risking of a “tit-for-tat” trade war with China could damage the sector more broadly, as retailers are forced to hike prices to account for new tariffs.

And so it appears that once again a Wall Street giant is cynically couching its marketing in the guise of social justice. Sound familiar?

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