NYC Councilman Completely Fabricates Child Sex-Trafficking Ring

Fourteen teen girls from the Bronx—all young women of color, ages 12 through 19—have gone missing since July 2014, according to New York City Councilman Andy King. He worries that their disappearances indicate the presence of a prolific youth sex-trafficking ring operating in the area. “Every other week our young girls are just vanishing off our streets,” said King at a June 29 press conference, explaining with creepy gusto that the missing Bronx teens had all been “attractive girls.” 

There’s just one problem with the Councilman’s lurid speculation: the vast majority of those 14 missing girls have already been reunited with their families. 

The day after the New York Daily News reported on King’s fears of forced prostitution and widespread teen abduction, the paper ran an update with input from the New York City Police Department (NYPD). According to NYPD officials, 11 of the 14 Bronx girls who had gone missing are now back home. 

Not all names were removed from the missing persons list, which is how the confusion arose,” the Post reported. 

At King’s press conference, he and other demonstrators held signs featuring photos of the girls (photos that have since been spread widely by the media) and information about their disappearances. Apparently, however, King hadn’t bothered talking to the families of these props teens before sounding the alarm about them.

“There is a valid active prostitution ring that is occurring up here in the Bronx,” said King, brandishing pics of girls now back in high-school. “We need to find ways to shut it down.” 

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European Market Breaks: Stoxx 50, Stoxx 600 Have Not Calculated Prices For Nearly An Hour

With European stocks tumbling, it was only a matter of time before someone pulled the biggest circuit breaker of all, i.e., the plug. And sure enough:

  • EUREX SAYS IT DOESN’T CURRENTLY HAVE STOXX UNDERLYING PRICES
  • EURO STOXX 50 AND STOXX 600 HAVE NOT CALCULATED FOR 50+ MINS
  • DEUTSCHE BOERSE SPOKESWOMAN CONFIRMS STOXX 600 NOT CALCULATING

And from the exchange:

Emergency Information Failure STOXX underlying feed

 

Due to technical problems with the price data feed, the Eurex system does not currently have STOXX underlying prices. Please do not hesitate to call Market Supervision for any questions you may have. Aufgrund technischer Probleme beim STOXX Preisdatenstrom werden derzeit die Basiswertpreise nicht aktualisiert. Sollten Sie Fragen haben, wenden Sie sich bitte an Market Supervision.
Market Supervision +496921111210

We expect the exchange to promptly fix itself just as soon as a bid reappears.

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“Rebound? What Rebound?” – Services Sector Business Confidence Hits Record Lows As ISM Surges To 7-Month Highs

Markit's Chris Williamson sums up today's Services sector data in three simple words – "Rebound? What Rebound?" With new business expanding at the fastest pace since January but business confidence plumbing record lows, there appears to be total confusion in the Services economy as today's PMI print at 51.4 offers little hope for Q2 GDP. So having said all that, ISM data hit and soared to 56.5 – the highest since Nov 2015 – beating expectations by 5 standard deviations and well above the highest forecast. All subcomponents improved aside from Prices Paid as it seems "baffle 'em with bullshit" economics is back.

Seriously…

 

With ISM beating expectations by 5 standard deviations…

 

As if the world were not confused enough by record low bond yields and near record high US equity prices, here are two headlines from today's Services PMI data that sum it all up…

"New business expands at fastest pace since January"

 

"Business confidence drops to a fresh survey-record low"

So everything is awesome… and the future is terrible? Or as per ISM – everything is awesome again…

ISM respondents are exuberant??

  • "Business is generally good and following historical seasonal patterns. Suppliers report being very busy compared to last year." (Management of Companies & Support Services)
  • "Business is strong in the private sector; bidding a lot of commercial buildings." (Construction)
  • "Slightly greater activity, specifically due to midyear reporting." (Finance & Insurance)
  • "Oil prices seem to be stabilizing in the $48/bbl. range which has eased the panic in the industry over falling prices." (Mining)
  • "Overall business appears to have flattened out. New business for the next six months looks good according to sales forecasts." (Professional, Scientific & Technical Services)
  • "Steady movement with negligible fluctuations both up and down." (Public Administration)
  • "Business was slow, but starting to pick up this month." (Retail Trade)
  • "More new business." (Utilities)
  • "Oil, gas, steel [and] coal mining continues to drag down revenues. Automotive, food, package handling and airports [are] strong." (Wholesale Trade)
  • "Overall business conditions are good, even though growth is flat." (Health Care & Social Assistance)

We leave it to Chris Williamson, Chief Economist at Markit, to sum up the mediocrity…

“Rebound, what rebound? The final PMI numbers confirm the earlier flash PMI signal that the pace of US economic growth remained subdued in the second quarter. While volatile official GDP numbers are widely expected to show a rebound from a lacklustre start to the year, the PMIs suggest the underlying malaise has not gone away. The surveys point to an annualized pace of economic growth of just 1% in the second quarter.

 

“Service sector confidence has slumped to the lowest since 2009 alongside ongoing woes in the energy and manufacturing sectors, as well as worries about the outlook amid presidential election uncertainty.

 

“Hiring has also slowed, though remains surprisingly upbeat. The surveys signal non-farm payroll growth of 150,000 in June, suggesting many companies expect the slowdown to be short-lived.”

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No More Accidental Criminals: New at Reason

A retired racecar driver on a snowmobile outing in Colorado gets lost in a blizzard and unwittingly crosses into a National Forest Wilderness Area, where motorized vehicles are prohibited. A Native Alaskan trapper sells 10 sea otters to a buyer he mistakenly believes is also a Native Alaskan. An 11-year-old Virginia girl rescues a baby woodpecker from her cat. The first two of these incidents resulted in misdemeanor and felony convictions, respectively, while the third led to a fine (later rescinded) and threats of prosecution. All three qualify as federal crimes, even though the perpetrators had no idea they were breaking the law—a kind of injustice that would be addressed by reforms that opponents falsely portray as a special favor to corporate polluters and other felonious fat cats.

The federal code contains something like 5,000 criminal statutes and describes an estimated 30,000 regulatory violations that can be treated as crimes. The fact that no one knows the precise numbers is itself a scandal, writes Jacob Sullum. And it’s compounded by the fact that many of these provisions include minimal or no mens rea requirements, which specify the mental state required for conviction.

View this article.

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These six former Goldman Sachs bankers want to destroy your savings

[Editor’s note: This letter was penned by Tim Price, London-based wealth manager and author of Price Value International.]

Rule #1 in central banking: Never go full Draghi.

Mario Draghi, of course, is the President of the European Central Bank (ECB) who pledged to do “whatever it takes” to save the euro. Or was it save the world. We forget.

Anyhow, Mark Carney, the head of the Bank of England, just went full Draghi, pledging to do, effectively, whatever it takes… even if that means destroy the British pound or economy.

Future historians will no doubt look back at this period in amazement, wondering, given the stunning and murderous failures of Nazi Germany and Soviet Russia, how central planning ever managed to find a last hold-out amongst the world’s central banks.

Yes, Britain may have finally escaped from the EU lunatic asylum.

But as investors we remain trapped in a surreal monetary nightmare in which clueless politicians and desperate central bankers have no choice but to print more money.

This decision, of course, continually erodes the purchasing power of individuals’ savings. It is a tax. An inflation tax.

And this is a tax that exclusively benefits those heavily indebted… namely governments and commercial banks.

It is perhaps no wonder that our own head of the Bank of England, Mark Carney, is a former Goldman Sachs banker, along with ECB President Mario Draghi (another ex-Goldman Sachs banker) and the four Federal Reserve bank presidents in the United States who are also ex-Goldman Sachs bankers (the current heads of the Minneapolis, New York, Dallas, and Philadelphia branches). And the list goes on.

We truly have the best monetary system… that money can buy.

My colleague Tony Deden recently reminded me of remarks given by novelist Alasdair Macleod to the Committee for Monetary Research and Education in October 2011:

“I support sound money for two very good reasons. Firstly, it is a basic human right to choose to save, without our savings being debased by the tax of monetary inflation.

“Those who are worst affected by this inflation tax are not the rich (they benefit) but the poor and the barely well-off, which is why monetary inflation undermines society and why the right to sound money should be respected.

“If government gives itself a monopoly over money, it has a duty to protect the property rights vested in it.

“Secondly, it is a basic right for us to own our own money rather than have it owned by the banks.

“For them to take our money and expand credit on the back of it debases it. It is an abuse of an individual’s property rights, and a banking licence is a government licence to do so.

“If anyone else was to do this they would be guilty of fraud. Banks should be custodians of our money, and it should not appear in their balance sheets as their property.

“Sound money guarantees a stable yet progressive economy where people are truly equal. It allows people to save properly for their retirement so that they will not become a burden on the state.

“It leads to democracy voting for small governments. It encourages peaceful trade and discourages war. It is the only path, after this mess, that leads us to long-lasting and peaceful prosperity. We really need everyone to understand this for the sake of our future.”

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World’s Biggest Asset Manager Downgrades European Banks To Sell, Expects Global Slowdown

Exactly one month ago we reported that BlackRock, the world’s largest asset manager, had downgraded global equities to Neutral, saying “U.S. valuations are elevated.” The chief catalyst for that call was BlackRock’s assumption that a summer Fed rate hike was imminent, something which now is assured won’t happen for years. So overnight BlackRock shifted its attention, and this time sees Brexit as the downside catalyst du jour, one which for Blackrock is enough to cause it to trim its global growth expectations, as it now expects “a modest slowdown over the next 12 months.”

More importantly, Blackrock also notes that since “there’s limited scope for monetary policy to reflate the global economy, however, and much-needed fiscal stimulus and structural reform progress looks unlikely over the coming months” it has in response “downgraded European stocks to underweight, with a negative view of the eurozone banking sector.

Offsetting this negativity is Blackrock’s “preference for income” and as a result it has “upgraded U.S. credit and EM debt to overweight. We like U.S. investment-grade credit, hard-currency EM debt, stocks in selected EMs and global quality and dividend-growth stocks.”

Here are the key points:

  • We have updated our asset views to reflect political uncertainty, weaker global growth and low-for-longer interest rates ahead.
  • Global stocks have regained some of what they lost in the two trading days post Brexit, but safe-haven assets remain resilient.
  • This week’s U.S. jobs report will show the extent to which May’s weak report was an anomaly.

The full note:

One thing that’s certain in a post-Brexit world: uncertainty. We see heightened political uncertainty, more modest global growth and low-for-longer interest rates ahead, and we have updated our asset views accordingly.

Economic Policy Uncertainty, 2000-2016

Political uncertainty has increased following the British vote to exit (Brexit) the European Union (EU), and we expect elevated uncertainty for some time. The UK prime minister position is open, a Scottish independence referendum is possible and Brexit negotiation will likely take at least two years. The imminent risk of other EU exits is low, we believe, but key political votes occur in Italy, France and Germany over the next 15 months, and in the U.S. in November.

We have trimmed our global growth expectations, and now expect a modest slowdown over the next 12 months. We see risk of a UK recession and European slowdown, as Brexit uncertainties weigh on sentiment. Our new BlackRock Macro GPS “nowcasting” indicator suggests Brexit-related uncertainty has already started to negatively impact UK and global economic growth. We see limited direct economic impact on the U.S., developed Asia and emerging markets (EM), but increased downside risks.

We expect lower rates ahead, with the Bank of England set to cut interest rates soon, U.S. rates on hold and potential for further quantitative easing in the UK, eurozone and Japan. We believe there’s limited scope for monetary policy to reflate the global economy, however, and much-needed fiscal stimulus and structural reform progress looks unlikely over the coming months.

In response, we have downgraded European stocks to underweight, with a negative view of the eurozone banking sector. We have a preference for income, and have upgraded U.S. credit and EM debt to overweight. We like U.S. investment-grade credit, hard-currency EM debt, stocks in selected EMs and global quality and dividend-growth stocks. Overall, in today’s uncertain, low-growth environment, we prefer credit to equity and believe exposure to gold and alternatives as diversifiers makes sense.

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Video Shows Alton Sterling Shot and Killed by Baton Rouge Police Despite Being Pinned and On His Back

Alton Sterling37-year-old Alton Sterling was shot and killed early Tuesday morning after being shot multiple times to the chest, while being pinned to the ground on his back by two Baton Rouge (La.) police officers. 

Police had responded to an anonymous call that a man matching Sterling’s description had threatened someone with a gun while standing outside of the Triple S Food Mart. 

Cellphone video shot by a bystander was obtained by The Advocate, which shows an officer tackling Sterling to the ground, followed by another officer forcing Sterling onto his back. One officer screams, “he’s got a gun!” and the second officer pulls out his gun and holds it inches away from Sterling’s chest.

Then the sound of multiple gunshots is heard. The bystander holding the camera turns away from the incident at this point and a woman can be heard sobbing and screaming “Oh my God!” The entire exchange takes place in less than 30 seconds. 

The body cameras worn by the officers reportedly fell off during the altercation, but apparently police dashcam and store security camera footage of the shooting exists.

Sterling was a father of five, known locally as “the CD man.” Triple S Food Mart owner Abdullah Muflahi reportedly gave Sterling his blessing to peddle his wares outside the store. Muflahi told CNN he never saw Sterling get into an altercation with anyone and was not aware of any incident where Sterling had pulled a gun on someone, though he says Sterling recently started carrying a weapon after being mugged.  

The Advocate reports:

“His hand was nowhere (near) his pocket,” Muflahi said, adding that Sterling wasn’t holding a weapon. After the shooting, an officer reached into Sterling’s pocket and retrieved a handgun, Muflahi said.

“They were really aggressive with him from the start,” Muflahi said about the officers.

Sterling appeared to die quickly, Muflahi said. Just after the killing, the officer who fired the bullets cursed, and both officers seemed like they were “freaking out,” Muflahi said.

The store owner said he heard one of the officers say, “Just leave him.”

The two officers have been placed on administrative leave, and Baton Rouge Police Department spokesman Cpl. L’Jean McKneely told The Advocate that “We give officers normally a day or so to go home and think about it” before questioning them after a shooting, adding that the stress can cause “tunnel vision” and produce bad information. McKneely says the officers will likely be interviewed Wednesday morning, though the Louisiana Police Bill of Rights allows officers to delay interrogations for up to 30 days

Louisiana is an open carry state, which allows for anyone over the age of 17 and legally permitted to carry a firearm to possess one in public. It’s highly unlikely Sterling would have been permitted to carry a weapon, given his extensive rap sheet which included drug, theft, domestic battery, and weapons charges. The New York Daily News reports family members have said Sterling was on probation at the time of his death and had been living at a transitional shelter where he was known as a “a friendly man who stayed clean.”

Rep. Cedric Richmond (D-La.), who represents Baton Rouge, has called for a Department of Justice (DOJ) investigation into the shooting.

You can watch video of the shooting below (after the jump), but be warned, it is graphic and disturbing. 

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“It Feels Like 2008” Government Bond Yields Signal “Something Very Nasty Is Coming”

With global developed market bond yields crashing to record lows and almost $10 trillion of negative-yielding debt worldwide, it is no surprise that money managers are concerned that "it's starting to feel like 2008."

Global developed market bond yields crashed once again to new record lows overnight at just 40.0bps (having plunged from 63bps pre-Brexit)…

 

As negative yields become the new normal around the world. Japan and France are leading the way as demand for the safest assets boosts the amount of global bonds with negative yields to $9.8 trillion, according to Bloomberg World Sovereign Bond Indexes.

 

That’s up from $8.35 trillion before Britain voted to leave the European Union last month. The latest new entrants include Japan’s 20-year bonds, and French nine-year securities, which both saw yields drop below zero for the first time in the past 24 hours.

As John Anderson, a money manager at Smith & Williamson Investment Management in London concluded:

"Government bond yields are telling you something very nasty is about to happen. These property fund suspensions are a worry. I am risk-off at the moment, erring on the side of believing the govvies,"

Certainly seems like ever since Bernanke went back to the money-printing game after QE2 that he broke the stock market's ability to signal anything…

 

Because the days of 'fundamentals' are long gone…

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Can The EU Survive As A Prison? Who Has The Keys?

Submitted by Michael Shedlock via MishTalk.com,

In the wake of Brexit, the EU and German Chancellor Angela Merkel responded to the UK with spite and vengeance.

Merkel insists that if the UK pursues a Norway-style solution, it will have to accept the EU’s migration rules along with it.

Ironically, had the EU’s migration rules been more sensible, the UK would not have left in the first place.

 Following a close election in which there were voting irregularities, Austria’s Constitutional Court Orders Rerun of Presidential Election.

Citing serious irregularities in the counting of postal votes, Austria’s constitutional court issued an unprecedented rule mandating a rerun of the presidential election in which Green party candidate Alexander Van der Bellen narrowly beat Freedom Party and anti-immigration candidate Norbert Hofer

Hofer was ahead before postal votes were counted. Perhaps he wins the second chance election.

Hungary Announces Referendum on Migration

Hungary is so fed up with EU’s refugee polices that it announced an October Referendum on EU Migrant Plan.

“Is it the goal of European policy to stop migrants at the borders, to keep processes under control, to conduct procedures outside our borders and to then decide on admitting certain individuals? Is it our goal to let them in and to redistribute them later?” Hungary’s prime minister Viktor Orban said in Brussels last month.

Four Countries Fed Up With EU

Poland, Hungary, Slovakia and the Czech Republic issued a joint statement “The genuine concerns of our citizens need to be better reflected. National parliaments have to be heard.“

Poland’s deputy prime minister Mateusz Morawieck said “The British voice was the voice of reason.”

For details, please see Four Countries Blame Jean-Claude Juncker for Brexit, Two Seek His Ouster.

The EU Prison

Financial Times writer Martin Wolf asks “Is the best way to preserve the EU bloc to make it a prison, rather than a desirable place of refuge?”

Other than a stray sentence here and there, I seldom agree with Wolf on anything.

This time, he generally gets things correct in his article How Europe Should Respond to Brexit.

The UK is leaving. That has to be the assumption of its EU partners, particularly if free movement of people remains an inviolable principle. So how should the rest of the bloc respond?

 

The UK’s almost certain departure is a threat to the EU on two dimensions.

 

First, the UK is a neighbour, a market, a financial centre, a security partner and a link to the wider world. It is in the EU’s interest to achieve a mutually satisfactory relationship, however infuriating the UK must be. This argues for the pragmatic position taken by Alain Juppé, frontrunner in the race for the French centre-right presidential nomination. He even suggests that restrictions on free movement of people should be negotiable. If so, that would surely have obviated Brexit.

 

Second, Brexit is a precedent. The first country to leave the EU is, inevitably, an example to those that wish to follow suit and a warning to those who oppose it. It is natural for the latter to seek to undermine the appeal of the former by punishing the UK. I sympathise. The question they must ask themselves, however, is whether the best way to preserve the EU is to make it a prison, rather than a desirable place of refuge.

 

The paramount example of recent failure lies inside the eurozone. That has nothing to do with the UK. The sad truth is that, far from launching a period of prosperity, the euro has delivered a lengthy period of stagnation and massive divergences in living standards. Between the first quarters of 2008 and 2016, aggregate eurozone real gross domestic product rose by a mere 0.5 per cent, while real aggregate demand fell by 2.4 per cent. This is grim enough. Even worse, between 2007 and 2016, real GDP per head is forecast to rise 11 per cent in Germany, stagnate in France and fall by 8 per cent and 11 per cent in Spain and Italy respectively.

 

The core challenge for the EU is to make it work — and be seen to work — for the benefit of the great majority of its citizens. Germany has done well out of the euro. Its principal partners have not.

Separate Ways

Separate Ways

Who Has the Keys?

Jean-Claude Juncker and Angela Merkel want to make the EU a prison. The Eurozone was designed as a prison from the beginning.

But like Otis on the Andy Griffith Show, voters have the key.

Otis was the town drunk. He frequently locked himself in jail to sober up. Otis had access to the courthouse keys and could come and go any time he wanted.

Voters too have the keys. The UK has had enough of the EU prison and wants out.

The more the EU responds by cramming absurd rules down the throats of citizens, the more likely it is for voters to demand the prison key.

Once again, it is Angela Merkel is the Person Most Responsible for Brexit.

Her policies on migration rules led to the UK voting to leave.

The cat is finally out of the bag. And voters know they have the key.

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US Trade Deficit Jumps In May As Stronger Dollar Puts A Lid On Exports

Confirming once again that a rising dollar is not good for US trade, moments ago the dept of commerce announced that the goods and services deficit was $41.1 billion in May, up $3.8 billion from $37.4 billion in April, and worse than the $40 billion expected. In fact, this was the first miss on expectations (a bigger than expected deficit) since October 2015.

The rising deficit was a function of a modest decline in exports – courtesy of a stronger dollar – which dropped by $0.3 billion to $182.4 billion, while May imports rose $3.4 billion to $223.5 billion.

The May increase in the goods and services deficit
reflected an increase in the goods deficit of $3.7 billion to $62.2
billion and a decrease in the services surplus of $0.1 billion to $21.1
billion. Year-to-date, the goods and services deficit
decreased $7.2 billion, or 3.5 percent, from the same period in 2015.
Exports decreased $47.2 billion or 4.9 percent. Imports decreased $54.3
billion or 4.7 percent.

 

Breaking the trade components down, Exports of goods decreased $0.2 billion to $119.8 billion in May.

Exports of goods on a Census basis decreased $0.4 billion:

  • Capital goods decreased $0.8 billion.
  • Civilian aircraft decreased $0.4 billion.
  • Computer accessories decreased $0.3 billion.
  • Automotive vehicles, parts, and engines decreased $0.3 billion.
  • Other parts and accessories decreased $0.3 billion.
  • Foods, feeds, and beverages increased $0.5 billion.

Exports of services decreased $0.1 billion to $62.5 billion in May.

  • Travel (for all purposes including education) decreased $0.2 billion.
  • Financial services increased $0.1 billion.

On the imports side, Imports of goods increased $3.4 billion to $182.1 billion in May.

Imports of goods on a Census basis increased $3.3 billion.

  • Industrial supplies and materials increased $2.3 billion.
  • Nonmonetary gold increased $1.0 billion.
  • Crude oil increased $0.7 billion.
  • Consumer goods increased $1.3 billion.
  • Capital goods decreased $0.9 billion.
  • Civilian aircraft decreased $0.9 billion.

Imports of services were nearly unchanged at $41.4 billion in May.

  • Financial services increased less than $0.1 billion.

Breaking it down geographically:

  • The deficit with China increased $1.7 billion to $28.3 billion in May. Exports decreased $0.1 billion to $9.3 billion and imports increased $1.6 billion to $37.6 billion.
  • The balance with the United Kingdom shifted from a surplus of $0.7 billion to a deficit of $0.3 billion in May. Exports decreased $1.2 billion to $4.0 billion and imports decreased $0.2 billion to $4.3 billion.
  • The deficit with Japan decreased $0.9 billion to $5.0 billion in May. Exports increased $0.6 billion to $5.4 billion and imports decreased $0.3 billion to $10.4 billion.

Finally, the US trade balance excluding petroleum was down to $38 billion, near cycle lows.

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