Tag: news

Content originally published at iBankCoin.com

Just weeks after surviving the Las Vegas massacre at the Route 91 Harvest country music festival, a married couple from California died in a fiery wreck when their car rammed into the gate of their gated community and burst into flames less than a mile away from their Riverside County home.

Dennis Carver, 52, famously jumped on top of his wife Loraine, 53, to shield her from the gunfire during the Vegas massacre.

When Dennis Carver realized the loud cracks weren’t fireworks but instead rapid gunfire, he jumped on top of his wife, Lorraine (Lora) Carver, to shield her from the bullets. –Las Vegas Review-Journal

Officials report it took firefighters over an hour to put out the fire caused by the Carvers’ wreck. Their 16-year-old daughter, Madison Carver described hearing a “loud bang,” and saw her parents’ crashed car in flames when she went to investigate.

The Carvers’ eldest daughter, Brooke, 20, posted the following on Facebook Oct 20:

“This week we have been through more pain than we have ever been and probably will ever go through again. It’s hard to see Gods (sic) plan right now and how this was all part of it, but through the support of family and friends we have been pushing through.”

Other mysterious deaths

Granted – any event with 20,000 attendees will statistically have a few people who don’t make it to Christmas, however two other survivors of the Vegas massacre who notably said they saw multiple shooters have died weirdly, and one of them was trying to organize a survivors’ group to coordinate accounts of the incident when she died.

Kymberley Suchomel

Vegas survivor Kymberley Suchomel died October 9 in her Apple Valley, CA home just five days after she posted her version of events to Facebook. Her grandmother told the Victorville Daily Press that Kymberley appeared to have died in her sleep:

“Kymberley had epilepsy and she’s always been prone to seizures — she told her friend that she recently had three focal seizures,” Julie Norton said. “I believe the stress from the shooting took her life.”

Kymberley’s said on Facebook that “every single survivor I have talked to also remembers multiple shooters, and at least one from the ground.” 

A longtime friend of Suchomel’s also posted screenshots of a conversation with Kymberley in which she said she was planning to “organize a group of survivors” in order “to piece things together.”

“You can share my comment for sure,” Suchomel told her friend,  “And you can leave my name” she added. “I’m trying to organize a group of survivors so if anyone wants to contact me they can. Because this fucked up shit doesn’t make sense and we are trying to piece things together.”

Five days later Suchomel was dead.

Danny Contreras

The next mysterious death of a Vegas massacre survivor is Danny Contreras – who described multiple shooters as well. The 35 year old reported his account all over – with one of his tweets shared hundreds of times which stated “can’t believe i got out of concert alive! 2 men chasing me with guns.”  

CRAZY! Danny Contreras, #LasVegasShooting survivor.. Was found dead with gun shot wounds in his home. He reported TWO shooters chasing him!! http://pic.twitter.com/ql06DCKSwO

— ???????? Big Will ???????? (@WillontheRadio) October 28, 2017

Contreras was found dead in a vacant Las Vegas home with multiple gunshot wounds.

Police said 35-year-old Danny Contreras was found dead at 7:05 a.m. Monday. A woman who thought she heard a man groaning had called 911 requesting a welfare check on the 5800 block of East Carey Avenue, near North Nellis Boulevard.

Contreras died of multiple gunshot wounds, and the coroner ruled his death a homicide. –Las Vegas Review Journal

Las Vegas Police homicide Lt. Dan McGrath said it’s possible Contreras had gang ties based on the fact that he had tattoos, though the killing was likely related to narcotics rather than gang activity.

Neighbors said they did not hear any gunshots, however they heard arguing and a dog barking.

While the fiery death of the Carvers’ after careening into the gate of their gated community is indeed mysterious, the couple did not post publicly about multiple shooters. Kymberley Suchomel and Danny Contreras, on the other hand, most certainly did before their untimely deaths.

What do you think – multiple shooters or lone gunman with unknown motive?

 

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One month after Tesla surprised markets with an unexpectedly low production output of its much anticipated Model 3, delivering just 260 cars far below the 1,500 expected, which according to a follow up report from the WSJ was due to part of the car being made by hand, Wall Street was fearfully looking forward to today’s earnings report despite Elon Musk’s assurance that Tesla had its “all-time best quarter” for Model S and X deliveries. Those fears were justified when moments ago Tesla reported an adjusted, non-GAAP loss of -$2.92, far worse than the expected loss of $2.27, which was more than double the $1.33 loss in the second quarter.

The silver lining is that in the third quarter, Tesla generated revenue of $2.98 billion, slightly better than the $2.93 billion expected, but this was more than offset by the plunge in the Automotive gross margin, which in Q3 was 18.7 non-GAAP, far below the 25.0% in the previous quarter, and worse than expected.

However, the worst news is that in what has become the most sensitive topic for the EV maker, Tesla continued to burn cash, and in the third quarter it outdid itself again, with a record cash burn of $1.4 billion – or roughly $16  million per day: an unprecedented amount. This was higher than the $1.2 billion consensus forecast. In Q3, Tesla’s CapEx was $1.116 billion, a number which is set to continue pressuring its balance sheet as the company continues to ramp up Model 3 production. Tesla announced that capital expenditures are expected to be approximately $1 billion in Q4, “driven largely by milestone payments on Model 3 production equipment, as well as Gigafactory 1, and further expansion of stores, service centers, delivery hubs and the Supercharger network.”

Understandably, the cash burning behemoth was proud to announce that it had more than $3.5 billion in cash on hand at the end of Q3. There is just one problem, and this wasn’t announced in the letter: Tesla also had $3.9 billion in accounts payable and accrued liabilities, a number that was unchanged from the previous quarter, as the company drains all net working capital sources of cash it can find.

In terms of deliveries, there were no surprises: as the company already disclosed, it delivered 25,915 Model S and Model X vehicles and just 222 Model 3 vehicles, for a total of 26,137 deliveries. Combined Model S and Model X deliveries in Q3 grew 18% globally compared to Q2 and 4.5% versus the same quarter one year ago.

And this is where the trouble started, because looking into the future, Tesla revealed a decidely murky picture, warning that due to the the nature of manufacturing challenges during a ramp such as this “makes it difficult to predict exactly how long it will take for all bottlenecks to be cleared or when new ones will appear. Based on what we know now, we currently expect to achieve a production rate of 5,000 Model 3 vehicles per week by late Q1 2018, recognizing that our production growth rate is like a stepped exponential, so there can be large forward jumps from one week to the next.”

This is a problem as previously Tesla projected it would make 5,000 Model 3s in late December. It just pushed that target back.

Additionally, Musk did not say when he expects production to hit 10,000 per week:

 We will provide an update when we announce Q4 production and delivery numbers in the first few days of January. With respect to the timing for producing 10,000 units per week, it has always been our intention to implement that capacity addition after we have achieved a 5,000 per week run rate. That will enable us to make the next generation of automation even better while making our capex spend significantly more efficient.

Musk was quick to blame suppliers for again having to push back the delivery schedule, saying that “to date, our primary production constraint has been in the battery module assembly line at Gigafactory 1, where cells are packaged into modules. Four modules are packaged into an aluminum case to form a Model 3 battery pack. The combined complexity of module design and its automated manufacturing process has taken this line longer to ramp than expected. The biggest challenge is that the first two zones of a four zone process, key elements of which were done by manufacturing systems suppliers, had to be taken over and significantly redesigned by Tesla.”

The company then promised that it has “redirected our best engineering talent to fine-tune the automated processes and related robotic programming, and we are confident that throughput will increase substantially in upcoming weeks and ultimately be capable of production rates significantly greater than the original specification.” Which is bizarre in light of all the recent mass terminations from its Fremont facility.

The bottom line, is that accordint to Tesla, it remains difficult to predict exactly how long it will take for all Model 3 bottlenecks to be cleared or when new ones will appear, although it “continues to make significant progress each week in fixing Model 3 bottlenecks.”

Kicking the can yet again, TSLA said it will provide an update when it announces 4Q production and delivery numbers in the first few days of January.

Musk also said that between cash on hand, future cash flows and available lines of credit, believes TSLA says it is well capitalized to accommodate the revised ramp of Model 3 production to 5,000 per week… assuming it ever gets there of course.

Some more on the outlook:

Based on the recent acceleration in order growth, we now expect that Model S and Model X are on pace for about 100,000 deliveries in 2017, an increase of 30% compared to 2016. Notwithstanding these increased deliveries, we plan to produce about 10% fewer Model S and Model X in Q4 compared to Q3 because of the reallocation of some of the manufacturing workforce towards Model 3 production. As a result, inventory level of finished Model S and X vehicles should continue to decline.

 

We expect Model 3 non-GAAP gross margin to reach breakeven by end of Q4, because of increased capacity utilization, and it should improve rapidly in 2018 to our target of 25%. Our recent production challenges may affect short-term costs, but they have no impact on our 25% gross margin target, since there has been no change to our projections for material, labor and overhead costs per vehicle

Finally, some more bad news:

Due to a higher mix of temporarily lower margin Model 3 deliveries in Q4 compared to Q3, we expect non-GAAP automotive gross margin to temporarily decline slightly in Q4 to about 15% and then recover starting in Q1. Gross profit is expected to grow more than operating costs in Q4 compared to Q3, while operating costs are expected to be flat to up slightly in Q4. Between cash on hand, future cash flows and available lines of credit, we believe that we are well capitalized to accommodate the revised ramp of Model 3 production to 5,000 per week. Upon achieving this production level, we expect to generate significant cash flows from operating activities.

Or not:

Capital expenditures are expected to be approximately $1 billion in Q4, driven largely by milestone payments on Model 3 production equipment, as well as Gigafactory 1, and further expansion of stores, service centers, delivery hubs and the Supercharger network.

The worst news, however, is that investors may finally be losing patience and the stock is down as much as 5% after hours, a rare adverse reaction to the company’s increasingly shaky – if extremely ambitious – growth plan.

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According to The Wall Street Journal, President Trump has picked Jerome Powell to be the next Federal Reserve Chair.

The White House has notified Federal Reserve governor Jerome Powell that President Donald Trump intends to nominate him as the next chairman of the central bank, according to a person familiar with the matter.

The president spoke with Mr. Powell on Tuesday, according to another person familiar with the matter who couldn’t describe what they discussed.

Mr. Trump said in a video last week that he had “somebody very specific in mind” for the job.

“It will be a person who hopefully will do a fantastic job,” Mr. Trump said in a video posted to Instagram, adding, “I think everybody will be very impressed.”

Modest reactions for now in USDJPY and gold…

However, WSJ notes that while President Trump had settled on Mr. Powell by Saturday, but people familiar with the process had cautioned that he could change his mind.

WSJ summarizes Powell's views as follows…

On Interest Rates

Mr. Powell, 64 years old, has backed Ms. Yellen’s policy of gradually raising interest rates if the economy improves as projected. In recent public remarks he has sounded an optimistic note, saying he expects inflation to move up to the Fed’s 2% target, economic growth to remain steady and the unemployment rate to fall further. “I would view it as appropriate to continue to gradually raise rates,” he said in June.

On Shrinking the Fed’s Portfolio

Mr. Powell in September voted in favor of beginning the yearslong process of winding down the central bank’s $4.5 trillion portfolio. Like Ms. Yellen, Mr. Powell has said the Fed could resort to new rounds of asset purchases in another crisis if the economy needs more stimulus. Putting new assets on the Fed’s balance sheet should be an option “only in extraordinary circumstances,” he said in February.

On Monetary Policy Rules

Mr. Powell has joined several of his Fed colleagues in warning against relying too heavily on mathematical rules such as the so-called Taylor Rule to guide monetary policy. That could put him at odds with congressional Republicans who have pushed the Fed to adopt such a formula in an attempt to make Fed policy-making more transparent and predictable.

“Simple policy rules are widely thought to be both interesting and useful, but to represent only a small part of the analysis needed to assess the appropriate path for policy,” he said February. “I am unable to think of any critical, complex human activity that could be safely reduced to a simple summary equation.”

On Dodd Frank

Mr. Powell has expressed willingness to ease some of the burdens imposed on financial institutions from the 2010 Dodd Frank law, a position that could appeal to the Trump administration.

Speaking before lawmakers in June, Mr. Powell said he was looking into softening the Volcker rule preventing banks for making overly risky bets with their own money. He also said it might be appropriate to ease some of the annual stress tests that big banks must perform. 

He has also called for revisiting new supervisory requirements imposed on bank boards of directors after the crisis. In his view, a board’s role “is one of oversight, not management.” That, he said in a 2015 speech, means boards should not be saddled with “an ever-increasing checklist.”

On Fannie Mae and Freddie Mac

Mr. Powell has called on Congress to overhaul the housing finance system, saying he’d like to see the country’s two large mortgage-finance firms, Fannie Mae and Freddie Mac, move out from under government conservatorship. More private capital in those firms would reduce the risk of a taxpayer-funded bailout in the event of a downturn, he said in a speech in July.

Although the Fed isn’t responsible for housing finance, it supervises some of the country’s largest lenders who frequently sell their loan to the two agencies. “No single housing finance institution should be too big to fail,” he said.

*  *  *

Jerome Powell will be the first former investment banker to become Fed Chair (and first non-economics PhD in 40 years).

Powell, a Princeton graduate, was a lawyer in New York before he joined the investment bank Dillon Reed & Co. in 1984. He stayed there until he joined the Treasury Department in 1990. After he left Treasury, he became a partner in 1997 at The Carlyle Group (CG), the private equity and asset management giant. He left Carlyle in 2005.

He will also likely be the richest Fed head ever – Powell's assets are worth between $21 million and $61 million, according to financial disclosures which require officials to give a range in the value of their various holdings.

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Amid Capitol Hill hearings and rising concerns over regulation, Facebook crushed expectations in Q3 – beating top- and bottom-line dramatically and better-than-expected user growth – sending the stock price higher after-hours to new record highs.

• 3Q revenue printed $10.33 billion, beating estimate of $9.84 billion (range $9.52 billion to $10.18 billion)
• 3Q EPS printed $1.59, smashing estimate of $1.28 (range $1.16 to $1.44)
• 3Q monthly active users (MAU) printed 2.07 billion – better than the estimated 2.04 billion.
• 3Q daily active users (DAU) printed 1.37 billion – better than the estimated 1.35 billion.

However, after FB shares jumped immediately, they quickly turned back lower…

If investors wonder why the shares aren't screaming more aggressively higher, perhaps it is this comment from CEO Mark Zuckerberg…

"We're investing so much in security that it will impact our profitability. Protecting our community is more important than maximizing our profits."

Additionally, Facebook reports:

Mobile advertising revenue – Mobile advertising revenue represented approximately 88% of advertising revenue for the third quarter of 2017, up from approximately 84% of advertising revenue in the third quarter of 2016.

Capital expenditures – Capital expenditures for the third quarter of 2017 were $1.76 billion.

Cash and cash equivalents and marketable securities – Cash and cash equivalents and marketable securities were $38.29 billion at the end of the third quarter of 2017.

Headcount – Headcount was 23,165 as of September 30, 2017, an increase of 47% year-over-year.

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Record highs for stocks, 10 year lows for the yield curve…

 

Small Caps were in risk-off mode today (having oscillated this week) as the S&P, Dow hugged the unchanged line and Nasdaq was modestly bid ahead of tonight's earnings…

 

The moves post-FOMC were marginal…

 

The S&P dipped out of the gate to unchanged and then VIX was clubbed like a baby seal to get it green again…

 

FANG Stocks rallied ince again ahead of tonight's earnings…

 

Notably, stock that would benefit most from corporate tax reform have notably underpeformed ahead of tomorrow's tax plan release…

 

High Yield bond prices tumbled below key technical support…

 

Treasury yields were mixed today with the long-end outperforming – notably moving after the refunding news this morning…

 

The yield curve continues to collapse…

 

To new 10 year flats…

 

The Dollar Index managed very minor gains today but traded in a very narrow range…

 

All commodities are higher on the week with silver leading…

 

WTI/RBOB sank after DOE data disappointed compared to API – despite more OPEC jawboning from UAE…

 

We also note that copper futures continue to rebound and remains massively – and oddly – decoupled from raw industrial commodity prices…

 

Finally, Bitcoin surged to another new record today above $6600…up 15% since Friday…

 

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U.S. auto sales for the month of October came in mostly mixed with Fiat and GM being the biggest losers relative to street estimates and Ford beating on strong truck and fleet sales.  GM forecasts that the overall SAAR for the month ended up around 18mm units, versus 17.5mm expected, as sales remain elevated due to hurricane-related replacements.  Here’s more from Detroit News:

General Motors Co. and Fiat Chrysler Automobiles NV on Wednesday reported sales declines in October, while Ford Motor Co. saw sales jump 6.2 percent compared to the same month a year ago thanks to strong truck and fleet sales.

 

Fiat Chrysler reported a 13 percent drop compared to the same month a year ago, due to a 43 percent decline in fleet sales compared to last year. GM sales fell 2.2 percent due largely to slumping Buick and Chevrolet deliveries; only the automaker’s GMC brand saw a bump in sales last month, up 4.6 percent.

 

But overall, analysts expect a relatively strong sales month due to buyers in the Texas and Florida replacing storm-damaged vehicles, and generous sales incentives being offered by carmakers.

 

GM reported it sold 252,813 vehicles last month, with pickups up 9 percent to 84,902, and crossover sales were up 12 percent. Fiat Chrysler sold 153,373 vehicles in October. Retail sales fell 4 percent, though the company’s Ram and Jeep brands had strong months, according to the automaker. Ford sold 200,436 vehicles; 93,248 of those were trucks.

Of course, more important than the headline numbers, which are skewed by the recent hurricanes, is the fact that incentive spending continues to rise despite abnormally strong demand and production cuts already implemented earlier this year.

“Although the headline shows a small decline in sales, October looks relatively strong for the industry, as evidenced by the nearly 18 million (seasonally adjusted annual rate),” said Tim Fleming, analyst for Kelley Blue Book.

 

Fleming said some of the strength can be attributed to replacement demand that continues in Texas and Florida due to hurricanes. Perhaps more importantly, he said, higher incentive-spending by carmakers is playing a role: “Even with production cuts this year, incentives are on the rise and have reached 11 percent of average transaction prices. This is an indicator that new-vehicle demand is still contracting, and production cuts could be on the horizon to prevent oversupplies.”

 

Analysts at Edmunds forecast a steeper year-over-year decline at 3.5 percent. But the automakers will still see a lift from vehicle recovery sales due to hurricane season.

 

“While replacement demand in Houston was higher in September, we anticipate that hurricane recovery efforts will continue to supplement October vehicle sales in the market,” said Jessica Caldwell, Edmunds executive director of industry analysis. “In Florida, far fewer vehicles were lost to flood damage, but we expect to see an incremental boost in vehicle sales primarily from shoppers who may have delayed their purchases due to the storm.”

Meanwhile, despite the best hopes of wall street that recent hurricanes would help solve GM’s inventory problem, the company’s inventory days actually crept up in October compared to the previous month.

And here are more highlights from Stone McCarthy Research on the breakdown of car/truck sales mix for the month:

Car sales and truck sales are both coming in below expectations so far. Part of the reason for last month’s strength in car sales was due to fleet sales, so we expect to see some of the replacement sales after Hurricanes Irma and Harvey showing up more in this month. Given their sales figures, domestic light vehicle sales for October look to be at about 13.8 million units, below that of the 14.1 million selling pace of September.

 

General Motors domestic car sales came in below our expectations, and were down over 23% from last year. Domestic light truck sales for GM in October were in line with our estimate, and were up 3.5% from last year.

 

Domestic car sales were also weaker than we expected for Ford, though they saw the smallest year over year decline of the big three. Ford’s domestic light truck sales were a bit stronger than we expected. Their 12.3% year over year rise was the largest of the big three.

 

Chrysler domestic car were also a bit lower than we expected, and were also down about 23% year over year. Their light truck sales saw a decline of over 10% from last year, just as we expected them to.

 

Honda, Toyota, and Volkswagen sales all came in below our expectations.

 

Including the Detroit Three, we project the selling pace for domestic cars in October to come to 4.71 million units (saar) versus 4.91 million in September. We expect car sales to decline 6.6% from last October. We look for the selling pace for October light trucks to reach a 9.07 million unit selling pace (saar), compared to September’s 9.15 million selling pace, a 0.1% decrease in light truck sales from last October.

So what say you?  Still time to buy the hurricane/incentive/subprime-fueled demand surge in auto sales or time to move on?

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