Tag: news

A recent Statistics Canada report confirms price deflation has hit the marijuana industry in an even more significant way than expected, as a downward slide in prices puts a squeeze on profits for producers in the soon-to-be-legal market.

According to data published last Thursday by Statistics Canada, the annual change in the average cost per gram declined 7.7 percent in 2017 verse the prior year, this is the most significant decline in more than a decade, as the Trudeau administration prepares for legalization as soon as July.

Bloomberg believes the decline in prices is not a force of demand, but more on the oversupplied side.

“Falling marijuana prices will indeed pose a challenge” to producers, said Bloomberg Intelligence analyst Kenneth Shea. Companies can adapt by creating strong brands and other services such as helping customers choose the right strain.

“In Colorado, they have learned to diversify and add more value to the equation,” he added.

Statistics Canada found that prices have declined to CAD$7.43 per gram, after topping at CAD$12 in 1989. For the math whizzes, prices have dropped 38 percent in almost three decades.

Producers are flooding the market with cheap marijuana contributing to the bearish sentiment around price. As producers ramp up output, the large amounts of marijuana will continue to drag prices down further inducing a steady decline in prices for the next several years.

The Canadian Broadcasting Corporation referenced a Canaccord Genuity report specifying that the long-term trend in per gram prices are projected to be lower for the next eight to ten years.

The Trudeau administration has said it over and over: marijuana legalization seeks to displace the illicit cannabis market and keep the profits out of the criminals hands and into the government coffers. By doing so, Trudeau is attempting to create a safer market with more reasonable access to marijuana for Canadians, but at the same time, his administration continues the deflationary trend in prices. Could the decline in prices be the spark which pops the Candian marijuana bubble.

Legalizing & regulating marijuana = less money to organized crime, and harder access for kids. #TLMEP

— Justin Trudeau (@JustinTrudeau) October 12, 2015

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How difficult will it be for central banks to normalize monetary policy in practice, and what will be the consequences of such policies for investors assuming that the central banks’ commitment to balance sheet reduction is maintained?

The answer, according to Chris Wood’s new Grizzle.com blog, is ominous:

This is unchartered territory.

The only precedent for the scale of the central bank balance sheet expansion of the past nearly 10 years was during World War II, with government debt and government guaranteed assets now accounting for at least as large a share of central bank balance sheets as during World War II.

Clearly, Wood explains, the purpose of such central bank balance sheet expansion in the 1940s was to assist the fiscal authorities in financing a war.

Which made us wonder, what ‘war’ are authorities financing this time?

The answer is simple – a war against reality!

The real aim, so far as Wood is concerned, has been to stop debt liquidation and thereby prevent the creditor classes, be they bankers or bond owners, from losing money.

…

As Wood notes, the biggest risk to world stock markets, and asset prices in general, in 2018 is that G7 central banks (led by the Federal Reserve) are finally attempting to normalise monetary policy nine years after the American central bank commenced quantitative easing in December 2008, in the midst of the so-called “global financial crisis”.

…

This raises the critical issue of central bank credibility. For the risk raised by the Fed’s attempt to normalize is that a stock market downtown may force it to reverse course; and with such a reversal there is a much greater risk of a resulting loss of central bank credibility.

This is because markets may conclude that central banks will never be able to exit so-called unorthodox monetary policy.

Read the full article here…

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Two days after we reported that Turkey valiantly demanded that US forces vacate military bases in the Syrian district of Manbij, when Turkey’s foreign minister Melet Cavusoglu also said that Ankara is calling upon the US to cease any and all support to Syrian Kurdish forces and militias, not surprisingly the US refused, and on Monday a top American general said that US troops will not pull out from the northern Syrian city of Manbij, rebuffing Ankara demands to withdraw from the city and risking a potential confrontation between the two NATO allies.

Speaking on CNN, General Joseph Votel, head of the United States Central Command, said that withdrawing US forces from the strategically important city is “not something we are looking into.”

Last week Turkish troops crossed into Syria in an push to drive US-backed Kurds out of Afrin. As part of the Turkish offensive, which is grotesquely code-named ‘Operation Olive Branch’, president Erdogan warned that the offensive could soon target “terrorists” in Manbij, some 100km east of Afrin.

“With the Olive Branch operation, we have once again thwarted the game of those sneaky forces whose interests in the region are different,” Erdogan said in a speech to provincial leaders in Ankara last week. “Starting in Manbij, we will continue to thwart their game.”

But not if the US is still there, unless for the first time in history we are about to witness war between two NATO members. And the US has no intention of moving.

Colonel Ryan Dillon, spokesperson for the US-led coalition, told Kurdish media on Sunday that American forces would continue to support their Kurdish allies – despite Erdogan’s threats.

“Turkey knows where our forces are in Manbij, and what they are doing there, and why they are there –to prevent any kind of escalation between the groups who are in that area,” Dillon told Rudaw TV. “The Coalition will continue to support our Syrian Democratic Forces in the fight against ISIS. We have said this all along, and we have said this with the Kurdish elements of the SDF. We will provide them equipment as necessary to defeat ISIS.”

However, in an apparent miscommunication, US NatlSec Adviser H.R. McMaster said a day earlier that the United States would no longer provide weapons to YPG fighters or the Democratic Union Party (PYD) – sending mixed messages about Washington’s relationship with the Kurds.

US army vehicles north of Manbij city, in Syria’s Aleppo province

The latest Turkish offensive in Syria has further strained the already contentious relationship between Washington and Ankara. A White House spokesman remarked last week that the operation “risks conflict between Turkish and American forces” in Syria. In an unprecedented step, last week the Turkish presidency went so far as to correct the White House readout of the phone conversation between Trump and Erdogan, explicitly accusing Trump of lying.

The Afrin campaign follows Erdogan’s vow to “strangle” the US-backed Border Security Force (BSF) in Syria. As discussed previously, the US-led coalition announced in January that it would help create the 30,000-strong BSF, half of which would be comprised of the Kurdish-dominated SDF.

Meanwhile, confirming that Turkey has no intention of backing down, and if anything will keep pressing on assuring an armed confrontation with the US is inevitable, Jenan Moussa with Arabic Al Aan TV, reports that “a huge story is developing right now.” Namely, that a big Turkish army convoy including APCs drove thru HTS controlled Idlib in Syria heading towards AlEis, a rebel controlled frontline with Syrian gov forces &allies. Turkish army convoy was escorted whole time by Al-Qaeda linked HTS group.”

1/ Huge story developing right now. Big Turkish army convoy including APCs drove thru HTS controlled Idlib in Syria heading towards AlEis, a rebel controlled frontline with Syrian gov forces &allies. Turkish army convoy was escorted whole time by AlQaeda linked HTS group. @akhbar pic.twitter.com/1cdRYwu8xC

— Jenan Moussa (@jenanmoussa) January 29, 2018

4/ I just made this map. Have a look at it in order to better understand the situation. The Turkish army convoy has stopped around Kafr Halab. The Russians are bombing &Syrian regime is shelling area around Al-Qammari. The convoy is intended for Al-Eiss so it can’t pass. @akhbar pic.twitter.com/XzkdudigKR

— Jenan Moussa (@jenanmoussa) January 29, 2018

5/ Here is another video of the Turkish army convoy when it was still driving earlier through Idlib before the Russians started bombing the route. I am just sharing it so you know how big this convoy is. @akhbar pic.twitter.com/iaOBR8Se0Q

— Jenan Moussa (@jenanmoussa) January 29, 2018

And some additional starting details, according to Moussa, who notes that Russian planes were in the sky as the Turkish convoy drove through HTS controlled Idlib province. They even bombed 15 KMs away from the convoy. “So big question now: Is the Turkish convey moving with the approval or in defiance of the Russians?”

For now the answer appears to be no:

Seems for now the Russians are not going to allow the Turkish army convoy to pass. I am hearing from one source on the ground that the convoy will go back in the direction of Turkey. I am in touch with sources on the ground in Idleb & will update as news develops.

Due to nearby Russian bombing &Syrian shelling, witnesses on the ground now say that the Turkish military convoy has basically turned off its lights and is waiting in the area. We are trying to find out if they will turn back or continue advancing despite warnings.

Will Erdogan be crazy enough to start a regional battle against both the US and Russia at the same time on Syrian soil, or will Russia flip and side with Turkey in its “defensive offensive” yet as it careens to a military confrontation with US troops? We expect to find out in the immediate future.

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What mutant do you get when you combine a hawk with a swan? According to a nervous Wall Street, the answer will be revealed on Wednesday, Janet Yellen’s final FOMC meeting as Fed Chair, when her swan song statement is expected to send a distinctly more hawkish signal than in December, by observing a more upbeat economic assessment and higher inflation measures, an outcome which could send short-dated yields spiking, lead to further curve flattening, and as for what it does to the beaten down dollar is anyone’s guess, especially if a determined hawkish bias by the Fed is seen as an accelerant to the next US recession.

And the uncertainty on what terms Yellen parts is leading to at least some indigestion among Wall Street analysts, starting with Goldman whose summary take we present below:

At Janet Yellen’s final FOMC meeting next week, we expect the FOMC to issue a generally upbeat post-meeting statement that includes an upgrade to the balance of risks and a slightly hawkish rewording of the inflation assessment. Taken together, we believe the tone of the statement will be consistent with a hike at the March meeting, barring a sharp weakening in economic conditions.

We think Fed officials will view the economic activity data released since the December meeting as broadly encouraging, particularly the strong holiday-shopping season and the related 3.8% increase in Q4 consumer spending.

And with tax reform now signed into law, financial conditions easing further, and the negative effects of the hurricanes clearly in the rear-view mirror, we believe most Committee members will view the growth outlook in an increasingly favorable light. Indeed, reflecting these considerations, we are increasing our own GDP growth forecasts for Q1, Q2, and Q3 by 0.25pp each (to +2.5%, +3.25%, and +3.0%, respectively; qoq ar).

Perhaps more importantly, inflation readings have firmed recently, and based on the Q4 GDP report, core PCE inflation likely ended the year a quarter-point above its August bottom. Of course, inflation still remains below target. But we think many Committee members will view the core inflation rebound in recent months as additional evidence that last year’s shortfall largely reflected temporary, idiosyncratic factors.

We also expect an upgrade to the balance of risks section, with the risks to the economic outlook changed from “roughly balanced” to “balanced.” In our view, the “roughly balanced” verbiage in the December statement was already somewhat stale, particularly when viewed in the context of the minutes’ upbeat growth commentary and risk assessment. Public remarks since that meeting bolster the case for an upgrade, and by our count, at least half of the Committee has recently referenced upside risks to growth. That being said, we expect the “closely monitoring” inflation language to remain.

Goldman is not alone in its concerns about a hawkish statement.  As Bloomberg notes, BofA, Credit Suisse and RBC say Fed may tweak description of market-based measures of inflation compensation to reflect recent move higher; economic assessment also “should get a slight mark-up from an already robust characterization,” RBC’s Michael Cloherty and Tom Porcelli say

Investors are still underestimating how much Fed could lift rates over time based on inflation, which along with other factors will push 10Y UST yield higher, according to Oliver Jones of Capital Economics.

Incidentally, for those keeping track, Market-implied odds of a hike are almost zero for Wednesday and 84% for March.

Here is what the rest of Wall Street thinks, courtesy of Bloomberg:

RBC (Cloherty, Porcelli, others)

• While FOMC meeting might seem uneventful, statement will get important tweaks that make it “much more hawkish” than in December, including an upgraded assessment of household spending and less- dovish inflation language
• “The market has been very sensitive to anything related to the inflation outlook,” and a change could get “a notable reaction”
• A wild card is whether FOMC acknowledges some shift in balance of risks following passage of tax cuts

Credit Suisse (James Sweeney, others)

• Fed is likely to keep fed funds rate target unchanged at 1.25%-1.5% and leave risk assessment as “roughly balanced”
• “We do not anticipate meaningful changes to the statement,” yet wording on market- based measures of inflation compensation will likely acknowledge recent pick-up in inflation breakevens

BofA (Michelle Meyer)

• Fed statement should send modestly hawkish signal as Jerome Powell prepares to take over as chair and more hawkish regional Fed presidents become voters this year
• Policy makers will likely stay on path of gradual normalization, with three hikes each in 2018 and 2019 and risk skewed toward a fourth hike by year-end; BofA also sees risk that FOMC hints that fiscal stimulus can boost growth

Capital Economics (Oliver Jones)

• Investors are underestimating how much Fed will hike, given likelihood of higher core inflation within months; this is a key reason why 10Y UST yield will rise
• Other factors that may put upward pressure on yields include higher federal deficit as result of tax reform, shrinking Fed balance sheet, and tighter/less expansionary monetary policy outside the U.S.
• “Although we are skeptical of claims that yields are about to surge, this all suggests to us that they will end the year a bit higher than they are at present”

Banque Pictet (Thomas Costerg)

• Moderately hawkish hints that could be in FOMC’s statement include an upgrade of Fed’s outlook to “balanced” from “roughly balanced” and a mention of recent pick-up in market-based inflation expectations
• Statement could also reflect the view that Fed is raising its expectations about impact of tax cuts on U.S. growth
• Dropping any mention of the central bank monitoring global economic and financial developments would be another slightly hawkish sign

Deutsche Bank (Brett Ryan, others)

• Statement will largely reinforce market’s pricing of three rate hikes this year, with next increase “all but certain to come in March”
• Of this week’s data releases, personal income and consumption released Monday “will be foremost in FOMC members’ minds”
• While policy makers won’t have January NFP data, they’ll get a sense of last month’s hiring trend with Wednesday’s ADP private employment survey; equally important will be Wednesday’s 4Q 2017 employment cost index

JPMorgan (Michael Feroli)

• Statement should include upbeat economic assessment similar to prior two statements; reference to post-hurricane disruptions will probably be dropped
• “We would be surprised if there were a mention of fiscal policy,” though there’s a hawkish risk that easy financial conditions will be mentioned
• While one could make a case that risks are now tilted to the upside, FOMC will “choose the safe path” and leave balance-of-risks assessment unchanged; Fed hasn’t altered market’s expectations for quarterly rate hikes despite growth, inflation and financial conditions moving in a direction that calls for more tightening

MUFG (Chris Rupkey)

• “The 800-pound gorilla in the room” of FOMC’s meeting is the market’s 80% odds of a March hike
• It will be interesting to see if the Fed puts any “heads-up” language in statement about March; Powell is a “no nonsense lawyer” who may not favor such a “nod-nod, wink-wink”

Morgan Stanley (Ellen Zentner, Matthew Hornbach, others)

• “We can hit the snooze button into the March meeting,” given data that’s largely in line with FOMC’s December outlook and markets already pricing in a rate hike in two months
• No change in policy seen and “very little” change to the statement expected
• TIPS market will see Fed’s acknowledgment of recent inflation developments “as a mere rubber stamp on already known information”
• If Fed paints a more optimistic picture on inflation, front-end breakevens will widen and breakeven curve should flatten; however, this is “not our base case”

* * *

Finally, going back to Goldman, this is what a hypothetical, and redlined, hawkish January FOMC statement would look like according to the vampire squid:

Expected Changes to January FOMC Statement

Information received since the Federal Open Market Committee met in November December indicates that the labor market has continued to strengthen and that economic activity has been rising at a solid rate. Averaging through hurricane-related fluctuations, job Job gains have been solid, and the unemployment rate declined further remained low. Household spending has been expanding at a moderate rate strengthened, and growth in business fixed investment has picked up in recent quarters. On a 12-month basis, both overall inflation and inflation for items other than food and energy have declined this year and are running below 2 percent. Market-based measures of inflation compensation have risen recently but remain somewhat low; survey-based measures of longer-term inflation expectations are little changed, on balance.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. Hurricane-related disruptions and rebuilding have affected economic activity, employment, and inflation in recent months but have not materially altered the outlook for the national economy. Consequently, the Committee continues to expect that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace and labor market conditions will remain strong. Inflation on a 12‑month basis is expected to remain somewhat below 2 percent in the near term but to stabilize around the Committee’s 2 percent objective over the medium term. Near-term risks to the economic outlook appear roughly balanced, but the Committee is monitoring inflation developments closely.

In view of realized and expected labor market conditions and inflation, the Committee decided to raise maintain the target range for the federal funds rate to at 1-1/4 to 1‑1/2 percent. The stance of monetary policy remains accommodative, thereby supporting strong labor market conditions and a sustained return to 2 percent inflation.

In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments. The Committee will carefully monitor actual and expected inflation developments relative to its symmetric inflation goal. The Committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run. However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data.

Voting for the FOMC monetary policy action were Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; Thomas I. Barkin; Raphael W. Bostic; Lael Brainard; Patrick Harker; Robert S. Kaplan; Loretta J. Mester; Jerome H. Powell; and Randal K. Quarles; and John C. Williams. Voting against the action were Charles L. Evans and Neel Kashkari, who preferred at this meeting to maintain the existing target range for the federal funds rate.

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While America’s nationwide economy is reportedly firing on all cylinders, the picture is very different from 10s of 1000s of Alaskans dealing with a state-wide recession forced to turn to the government for healthcare and food prompting questions from state lawmakers about the sustainability of those ‘safety-net’ programs.

Some states are more equal than others…

As The Anchorage Daily News reports, Gov. Bill Walker’s administration projects 240,000 people to be enrolled in the Medicaid health-care program next year, up from 163,000 in 2015.

And 101,000 Alaskans were receiving food stamps in September, up from 72,000 a year earlier, according to preliminary federal data.

In total, the program covers nearly one-third of the state’s population.

“It’s going to eat us alive if we don’t manage it,” said Soldotna Republican Sen. Peter Micciche, who oversees the state health department’s budget for the Senate.

Walker’s administration has acknowledged the spike in numbers and says it’s working to keep costs in check.

But it also points to a remarkable fact: The state’s annual costs for Medicaid have barely budged even as it covers nearly 50 percent more people.

“75,000 more people have had access to health care, and we’re spending the same state dollars,” said Pat Pitney, Walker’s budget director, at a Senate committee hearing earlier this month.

As for food stamps, formally known as the Supplemental Nutrition Assistance Program or SNAP, the federal government covers the full cost of Alaskans’ benefits, which was $190 million last year.

The state pitches in $10 million to administer the program.

Anti-hunger advocates want to see adequate budgets for their government programs rather than rely on the free market. They also oppose making it more difficult for people to qualify for assistance programs given how many Alaskans are struggling, said Sarra Khlifi, program manager at the Alaska Food Coalition.

Khlifi said her members — social service organizations focused on fighting hunger and its causes — have been noticing more consistent demand, instead of in the past when clients arrived at the end of the month after using up their food stamps.

But, As SHTFplan’s Mac Slavo notes, higher taxes to fund government programs only force those living paycheck to paycheck to also enter into these very programs, which were supposed to be designed to eliminate hunger. It’s the vicious cycle of a government attempt to fix a problem they started.

 

*  *  *

Once again the headlines of an ‘aggregated’ nation’s ‘wealth’ hide the ugly realities for so many real Americans at home.

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Authored by Irina Slav via OilPrice.com,

Texas is set for another oil boom, with production this year expected to hit a record high. That’s according to Karr Ingham, the oil economist who created the Texas Petro Index — a composite based on several upstream indicators.

 

The December 2017 reading of the index was 188.8, up from 151.2 in December 2016. This is still far below the peak of 314.2, which was reached in November 2014, a few months after the price slide began, but it’s much better than 2016 readings. In fact, the TPI has been rising for 13 months in a row.

[As a reminder, The Dallas Fed’s Manufacturing Survey spiked this month]

Now, that’s obviously thanks to higher prices and more efficient production, and Ingham noted both, adding, however, that oil price predictions are “all over the map”. Still, he forecast that oil production in both Texas and the United States as a whole will break the previous records. For the Lone Star State, Ingham predicted total production of 1.423 billion barrels this year, or around 3.9 million bpd, beating its previous record of 1.263 billion barrels (3.46 million bpd), set in 1972.

If prices stay above $60 a barrel, this would spur a strong rebound in oil and gas drilling in Texas and in the other southern states, as forecast by the Dallas Fed in a survey among oil executives conducted at the end of last year. At the time of the survey, WTI traded below the $60 threshold, but yesterday it hit $66.66, so there’s a very good chance that it will remain above $60 for a while, unless something unforeseeable happens.

The Energy Information Administration’s (EIA) latest weekly petroleum status report pegged daily production at 9.88 million bpd, of which 9.37 million bpd was from the Lower 48. The authority’s drilling productivity report said that in January the average daily production in Texas’s two largest shale plays, the Eagle Ford and the Permian stood at 1.242 million bpd and 2.794 million bpd, respectively. These are set to rise to 1.57 million bpd in the Eagle Ford and 2.87 million bpd in the Permian.

And that’s not all. New well production is also increasing in the two Texas plays: for the Eagle Ford this averaged 1,200 bpd this month, but next month it will rise to 1,281 bpd, according to the EIA. Average new well production in the Permian was lower than this, at 628 bpd this month but expected to rise to 632 bpd in February.

So, for now Texas’ oil and gas prospects look very bright. But how long it will shine is anyone’s guess.

The near term seems clear, unless OPEC and Russia decide to put an early end to their production cut deal. While drillers expand their production, the state could pocket 27 percent more from severance taxes, land rates, and royalties from the industry than previously calculated if WTI stays above $60. That’s about $3.3 billion in oil revenue, from the earlier estimate of $2.6 billion

But the production expansion in the Eagle Ford and the Permian will have to be measured. Today, Brent and WTI prices reacted negatively to doubts that U.S. shale oil production is growing too fast. Of course, they also reacted to a stronger greenback, so the doubts about the shale patch weren’t the single reason for the slight decline, but the fact remains that too fast a growth rate wouldn’t do Eagle Ford and Permian drillers any favors — but slow and easy could do the trick.

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Donald Trump 1 – Deep State 0

In a highly anticipated decision, on Monday evening the House Intelligence Committee voted to make public the memo alleging what some Republicans say are “shocking” surveillance abuses at the Department of Justice (DOJ).

In immediate response to the vote, the Committee’s top democrat Adam Schiff said that “we’ve crossed a deeply regrettable line”, adding that the “committee voted to put the president’s interest above the interest of the country.”

Today this committee voted to put the president’s interest above the interest of the country, @RepAdamSchiff says of R vote to release memo https://t.co/jHLS2Jkt45

— lesley clark (@lesleyclark) January 29, 2018

The decision weeks of speculation over whether the memo, which was drafted by staff for committee chairman Devin Nunes (R- Calif) would be made public. At the same time, it intensifies the dispute over what Democrats say is an all-out assault by Republicans to undermine special counsel Robert Mueller’s probe into Russian interference in the 2016 election.

Now the fate of the 4-page FISA memo is in the hands of Donald Trump: as we discussed earlier, the document will not be immediately released as under the House rule Republicans used to override the classification of the four-page memo, President Trump now has five days to review and reject its publication.

But, as per Bloomberg’s reporting earlier, the White House has signaled support for the document’s release and is widely expected to defy the DOJ in allowing the publication to go forward. The DOJ has opposed the release of the document, reportedly infuriating President Trump.

While Nunes has described the memo as “facts,” Democrats have slammed it as a collection of misleading talking points they are unable to correct without exposing the highly classified information underpinning the document.

As Bloomberg disclosed earlier on Monday, releasing the memo without allowing them to review it on those grounds, Assistant Attorney General Stephen Boyd wrote to Nunes, would be “extraordinarily reckless.”

The reason for the DOJ – and the Democrats’ fury – is well-known: Republicans who have read the memo have hinted heavily that it contains information that could unravel the entire Mueller investigation, long described by the president as a “witch hunt.”

* * *

While the precise contents of the memo remain unknown, it’s believed to contain allegations that the FBI did not adequately explain to a clandestine court that some of the information it used in a surveillance warrant application for Trump adviser Carter Page came from opposition research funded by the Clinton campaign, now known as the “Steele dossier.”

As Bloomberg reported earlier, citing three House lawmakers who have read the memo, the memo claims FBI officials didn’t provide a complete set of facts in requests made to a Foreign Intelligence Surveillance Act court to obtain a warrant or warrants on Carter Page, a Trump campaign associate.

Furthermore, the memo claims important details were left out that might have kept a judge from issuing a surveillance warrant, or possibly two, targeting Page. Those include its claims that investigators were relying partly on an unverified dossier put together by an opposition research firm that hired a former British spy, Christopher Steele — work that was funded by Trump’s opponent, Hillary Clinton, and Democrats.

The memo also spotlights Deputy AG Rod Rosenstein’s role in approving the warrant application, according to the New York Times. Rosenstein appointed Mueller and has become a recent target on the right — as well as reportedly garnering the frustration of the president.

* * *

According to The Hill, it’s unclear how much input the DOJ will have prior to the publication of the memo. Typically, when sensitive documents are declassified, the agencies with equities in the intelligence weigh in to assess whether its release would damage national security. But the committee initially stonewalled the DOJ from viewing the document because, as one committee member put it last week, “They’re the ones that have the problem.”

On Monday morning, deputy press secretary Raj Shah hinted on CNN that the DOJ would also not have an opportunity to review the document during the White House pre-release review. “The Department of Justice doesn’t have a role in this process,” he told CNN.

FBI Director Christopher Wray was reportedly allowed to view the document in the committee’s secure spaces over the weekend. A committee spokesperson declined to comment on Monday, as did the FBI.

Another unanswered question revolves around the highly-classified intelligence that underpins the memo, which came from documents provided to the committee by the DOJ as part of an agreement brokered by House Speaker Paul Ryan (R-Wis.). The DOJ has said that the release of the memo would be an abrogation of the terms of that agreement, an assertion that spokesmen for both Ryan and Nunes reject.

Lawmakers say the underlying intelligence justifying the memo’s allegations is so sensitive that only eight members of Congress are able to view it. Nunes and ranking member Adam Schiff (D-Calif.) are two of the eight figures, but the other members of the Intelligence Committee are not. The top two lawmakers on the Senate Intelligence Committee are also part of the so-called Gang of Eight, but while they have access to the underlying intelligence, Nunes has denied committee requests to see the memo.

“Seeking Committee approval of public release would require [House Permanent Select Committee on Intelligence] committee members to vote on a staff-drafted memorandum that purports to be based on classified source materials that neither you nor most of them have seen,” Boyd told Nunes.

Nunes has brushed aside the notion that the memo wouldn’t be persuasive without the underlying intelligence to substantiate its claims, calling the argument Democratic obstruction of his investigation into DOJ misconduct.  The memo is a committee work product and the responsibility for releasing it, or not releasing it, rests with Congress.

The underlying intelligence, however, belongs to the executive branch, and Trump could unilaterally make it public if he wished.

For now, however, the decision whether the FISA memo will be made public – an event which is supposed to help Trump greatly in ongoing crusade against Special Counsel Mueller – is entirely in Trump’s hands.

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In an ugly echo of the GE debacle from two weeks ago, MetLife stock tumbled 10% after hours on Monday after the company announced that it would revise prior financial reports because of overdue monthly pension benefits that it had failed to pay to possibly tens of thousands of workers in past years.

Specifically, MetLife had uncovered a “material weakness” in internal control over financial reporting of its annuity business and expects to increase reserves in total between $525m and $575m pre-tax. It also disclosed that the Securities and Exchange Commission ​enforcement staff ​“has made an inquiry” about the matter. MetLife said it also is responding to questions from its lead state regulator, the New York Department of Financial Services, and other state regulators.

Shares tumbled as much as 10% on the news.

From the press release:

Management of the company has determined the prior release of group annuity reserves resulted from a material weakness in internal control over financial reporting. MetLife expects to increase reserves in total between $525 million and $575 million pre-tax, to adjust for reserves previously released, as well as accrued interest and other related liabilities. The amount of the reserve increase is based in substantial part on actuarial, legal, statistical, and other assumptions. If actual facts and factors differ from those the company has assumed, the reserve the company has established could be adversely or positively affected.

Full-year net income for 2017 was cut by $165 million to $195 million, the New York-based insurer said Monday and added that it intends to make prior period revisions to reflect the balance of these adjustments in the appropriate historical periods. The company also expects to correct historical periods for unrelated errors in those periods, as required by accounting standards. Those errors were previously recorded in the periods in which the company identified them.

The company said it is responding to inquiries from the U.S. Securities and Exchange Commission, as well as state regulators from New York and other locations.

What does this mean? As auditor Francine McKenna noted, the part about “currently reviewing its processes and procedures for identifying unresponsive and missing international group annuity annuitants and pension beneficiaries” simply means that Metlife had no idea how many people they owed.

“Like property escheatment. Unclaimed potentially dead people.”

Explaining this further, MetLife is one of numerous large and highly rated life insurers that agree to take responsibility for some or all of the payments due participants in private-sector plans from employers such as Sears Holdings and PPG Industries. These deals are called “pension risk transfer.” Many employers with old-fashioned pension plans, under which they pay monthly benefits to retired workers, are eager to reduce their exposure to investment and interest risk in running pensions by striking risk-transfer agreements with insurers.

Those deals provide assets for investment, while helping the employer cut the risk of volatility in results. But they also require insurers and the employers to clean up and transfer data for many workers, including some that have left the company long ago.

And here lies the rub:

The New York insurer disclosed the unpaid pensions in mid-December and has been working with a firm that specializes in finding addresses to get in touch with the retirees who are owed money. It had set a goal to determine by Feb. 1 how much money it owed people. A law firm hired by MetLife has been investigating how its retirement business erred in allowed the pensions to go unpaid, according to the WSJ.

The New York insurer disclosed the unpaid pensions in mid-December and has been working with a firm that specializes in finding addresses to get in touch with the retirees who are owed money. It had set a goal to determine by Feb. 1 how much money it owed people. A law firm hired by MetLife has been investigating how its retirement business erred in allowed the pensions to go unpaid.

As Bloomberg adds, the charges add to a expenses MetLife incurred last year, many of them spurred by the separation of a U.S. retail business called Brighthouse Financial Inc.

Chief Executive Officer Steve Kandarian spun off that unit in August to help it remove some volatility in results and focus on other businesses including ones selling insurance through employers and international markets.

As a result of the uncovered weakness, MetLife pushed back its earnings release for the fourth quarter, which was originally scheduled for this week, to Feb. 13 and said it will hold a call the next day. MetLife still expects to file its 10-K by March 1

Following the MetLife news, the big question on many investors minds is whether GE and MET are ‘lone wolves’ or this type of unreported “material weakness” is a pervasive issue across the entire industry?

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An unknown hacker or group of hackers perpetrated the “biggest theft in crypto history” Friday morning when they stole what at the time were $500 million worth of NEM tokens – formerly one of the ten most popular digital currencies.

The hack was only the latest in a series of security breaches at digital currency exchanges that have resulted in hundreds of millions – if not billions – of dollars in customer funds’ being taken.

But how exactly do hackers continue to get away with these hacks?

Bloomberg has published a handy guide explaining how hackers are able to pull off these digital heists, and then launder the money

1. How did the hackers pull it off?

Coincheck hasn’t disclosed how their system was breached beyond saying that it wasn’t an inside job. The company did own up to a security lapse that allowed the thief to seize such a large sum: It kept customer assets in what’s known as a hot wallet, which is connected to external networks. Exchanges generally try to keep a majority of customer deposits in cold wallets, which aren’t connected to the outside world and thus are less vulnerable to hacks. Coincheck also lacked multi-signature security, a measure requiring multiple sign-offs before funds can be moved.

2. Where did the stolen coins go?

That’s one of the stranger aspects of these heists. Because transactions for Bitcoin and the like are all public, it’s easy to see where the NEM coins are — even though they’re stolen. Coincheck has identified and published 11 addresses where all 523 million of the stolen coins ended up. You can see for yourself online. Trouble is, no one knows who owns the accounts. Each one has been labeled with a tag that reads “coincheck_stolen_funds_do_not_accept_trades : owner_of_this_account_is_hacker.” NEM developers created a tracking tool that would allow exchanges to automatically reject stolen funds.

3. Does that mean the hackers won’t be able to cash in?

Not necessarily. The thief may be able to shake off surveillance by going through a “tumbler,” a service like ShapeShift that offers cryptocurrency trading without collecting personal data. Converting NEM coins into a more anonymized currency, like Monero, could conceivably launder them. But the huge total amount of money stolen presents a challenge. NEM trading was disabled on ShapeShift as of Monday.

4. What else can NEM developers do to fix this?

They could change the NEM blockchain by rolling back the record to a point before the attack. The so-called hard fork would create two versions of NEM, one that has never been hacked and another containing the stolen funds. While this approach worked for Ethereum in 2015, NEM Foundation Vice President Jeff McDonald said a fork is not an option.

5. Aren’t these exchanges being hacked a lot?

Yes, there’s a long history of thefts at cryptocurrency exchanges and wallets, dating back to the infamous robbery of Tokyo-based Mt. Gox in 2014. As prices of digital assets have soared, the platforms have become increasingly juicy targets for hackers. North Korean leader Kim Jong Un has allegedly sent his hackers out to swipe digital coins as his country faces tightening trade sanctions. One researcher estimates that more than 14 percent of Bitcoin and rival currency Ether has been stolen.

6. So what can you do to keep crypto-assets safe?

The lesson for crypto-enthusiasts is that exchanges are prime targets for hackers and no place to store your coins. One alternative is to keep the assets in software wallets, which come in online, mobile and desktop varieties. Hardware wallets are dedicated devices that offer an additional layer of security. For the extra paranoid, there is always the analog option: printing out the private keys for your coins on paper.

* * *

It’s worth noting that at least one person – Russian-born Alexander Vinnick – has been charged for helping hackers launder bitcoin stolen during the infamous Mt. Gox heist through BTC-e – a shadowy cryptocurrency exchange that was purportedly launched by Vinnick to be a haven for digital criminals.

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