Month: July 2017

Authored by Paul Craig Roberts,

PCR Takes a Look at Today’s “Top Stories” on Bloomberg

“Jeff Bezos briefly overtook Bill Gates as the world’s richest person. A surge in Amazon shares Thursday morning in advance of its earnings report gave Bezos a net worth of $92.3 billion, surpassing the Microsoft founder’s $90.8 billion fortune.

 

 

In afternoon trading, Bezos remains ranked second on the Bloomberg Billionaires Index. Gates has held the top spot since May 2013.”

Amazon’s stock closed yesterday at $1,046 per share. Amazon’s profits do not support this extraordinary price. Apple, a very profitable company, has a share price of $150.56, an overprice itself.

What or who is making Bezos so rich from an online sales company? Note, amazon.com is just sales. It is not some new manufacturing technology that produces valuable output at low cost. amazon.com is what Walmart, Sears, and Macy’s do, the difference being that amazon.com is online and Walmart, Sears, and Macy’s are in physical locations where real merchandise can be experienced hands on and tried on for fit.

In other words, online purchases are convenient, but you don’t know what you are getting. Does it fit? What is the quality? And so forth. How many times do you send it back before you get what you want?

There are two answers to the question about who is making Bezos rich.

One is that Wall Street is betting that the collapse of US anti-trust law and regulatory authority – it is still on the books but not enforced, just look at the Big Banks – and the ability of Bezos to use his ownership of the Washington Post, the newspaper of the country’s capital, to support those who support him, ensure that amazon.com will be an online monopoly. Once this is put in place, amazon’s prices and profits will rise, and the extraordinary amazon.com P/E ratio will come into line with reality.

 

Another is that Bezos’ cooperation with Washington’s spy network over all Americans is paid for by the CIA’s many front companies driving up the price of amazon.com’s stock. As the price of amazon.com rises, so does Bezos’ wealth.

 

[ZH: perhaps there is another reason related to the latter…]

 

I don’t know that either of these answers is correct. What I notice is that Bill Gates who heads the largest digital technology company is on occasion second fiddle to Bezos who heads an online Sears or Macy’s.

Apple with a share price of $150 earned $52.9 billion during the second quarter of 2017. Earnings per share were $2.10.

Amazon.com earned $38 billion. Earnings per share were 40 cents.

Why is amazon.com’s price $1,046 per share and Apple’s price is $150.56 per share.

Apple’s earnings per share are 5.25 times higher than amazon’s, but amazon’s stock price is 6.9 times higher than Apple’s. What explains this?

The free market answer is that amazon.com, a company that sells other companies’ products, is more promising than a high tech leading manufacturing company of our time.

Does that make sense to you?

Keep in mind that it was Bezos’ government propaganda sheet, the Washington Post, that gave credibility to the shadowy organization, PropOrNot, an entity better hidden than an offshore money laundering operation, that produced a list of 200 truth-tellers which it libeled as “Russian dupe/agent.”

Monopolies are inconsistent with free market capitalism and with democracy. Monopolies and government bond together to create fascism.

via http://ift.tt/2uG3Vsi Tyler Durden

We’ve spent a lot of time of late discussing Europe’s new MiFID II regulations that will go into effect in January 2018 and require investment banks to charge institutional clients separately for trading commissions and research.  As we’ve noted (here and here), initial offer prices are coming in relatively high at around $450,000 per bank…all of which led us to the following conclusions:

Of course, the logical takeaway from these exorbitant offering prices, if they hold, is that institutional clients will ultimately be forced to consolidate their vendors…translation, so long to the small independent research shops.  Meanwhile, investment banks will be forced to control costs by trying to focus on writing reports that people actually read (vs. the 1% hit rate they have today).  All of which means that those shrinking analysts pools are about to completely collapse.

Alas, it seems that we may have been a bit premature in our prediction of an early demise for independent research shops, at least if Sidoti and Rick’s Caberet has anything to say about it.  In light of the new regulations that will undoubtedly disadvantage his research firm, Peter Sidoti has embraced a whole new, fundamental-transformed research business model that he hopes will save his business…charging the companies he covers for research about themselves.  More from Bloomberg:

With the future of equity research looking shakier than ever, one boutique U.S. firm is betting its turnaround on getting paid by a different customer: the company being covered.

 

As analyst budgets get slashed amid new regulations designed to reduce conflicts of interest, Peter Sidoti hopes that laying those conflicts out in the open with company-sponsored research can bolster his small-cap focused firm, Sidoti & Co. “The wheels came off” Sidoti’s trading-pays-for-research model about a year ago amid shrinking fees and the rise of passive investing, he said. Bring in new rules requiring direct payment for research, “and all hell breaks loose.”

 

Three companies — a strip-club operator, a pet products company and a chipmaker — pay Sidoti $40,000 a year for coverage by the firm’s 25 analysts. Ultimately, he sees one-third of the stocks his firm covers, now around 300, being paying customers. The sweet spot for research sponsored by companies is those with a market capitalization of under $300 million and which have one or no analysts covering them, Sidoti, the founder and CEO of the firm, said in an interview in New York.

Wouldn’t it be ironic if new regulations specifically designed to eliminate banking conflicts actually resulted in an even more conflict-ridden business model?

But, at least Rick’s CEO is happy with his coverage…

Adult entertainment and sports bar company RCI Hospitality Holdings Inc., which pays for Sidoti’s services, said that it is challenging for smaller companies to get quality, independent analyst coverage. “We believe Sidoti has contributed to our overall effort to increase the understanding of our business and financial model,” Eric Langan, RCI’s Chief Executive Officer, said in an email. The company, which operates the Bombshells bar chain, has seen its stock gain 92 percent since Sidoti started coverage. Pet-products company OurPet’s Co. and chipmaker Ixys Corp., which are also paying customers of Sidoti, didn’t respond to multiple requests for comments.

 

Sidoti defends it’s rather controversial business model by comparing it to Moody’s and S&P which employee similar funding strategies…unfortunately, the weaknesses in those funding strategies were exposed for all the world to see during the mortgage crisis.

“We think equity research is heading the same way as debt research,” Sidoti said, drawing a comparison with how debt-rating companies like Moody’s Investors Service and S&P Global Ratings are paid by issuers to produce reports. While this model has also been fraught with conflicts and controversy, especially in the aftermath of the financial crisis, Sidoti sees a new opportunity for the sponsored-research model arising from the European Union’s MiFID II rules.

While we jest, at least the conflicts in Sidoti’s business model are overt and open for the world to see…unlike the current model which pretends to be ‘independent’ but secretly favors the perpetual advisory fee generating companies they cover and give preferential treatment to their favorite hedge funds.

Finally, since we know that you really only clicked on this post to see a larger picture of the teaser image, here you go…Happy Friday.

via http://ift.tt/2tL5kLu Tyler Durden

Authored by Kati Pavlich via Townhall.com,

The NFL took a massive ratings dive last year after a number of players, led by former San Francisco 49ers quarterback Colin Kaepernick, refused to stand for the National Anthem. At the time, NFL officials claimed they didn't exactly know why ratings were down and even used the 2016 presidential election as an excuse for why more people weren't watching. 

But according to a new survey from J.D. Power, NFL fans did in fact tune out in droves because of the disrespect and protest of the National Anthem before games. From ESPN: 

National anthem protests were the top reason that NFL fans watched fewer games last season, according to a new survey released by J.D. Power.

 

The pollster said it asked more than 9,200 people who attended either one football, basketball or hockey game whether they tuned into fewer games and why. Twenty-six percent of those who watched fewer games last season said that national anthem protests, some of which were led by Colin Kaepernick, were the reason.

 

After that, 24 percent of those surveyed who said they watched fewer games said they did so either because of the league's off-the-field image issues with domestic violence or with game delays, including penalties.

After being dropped from the 49ers last year, sports pundits and fellow players have accused anyone and everyone of racism for Kaepernick's failure to resign with another team. Turns out he's not only a bad quarterback, but a business liability. 

Patriotism is still winning in America and that's a good thing. Here's to hoping this season comes with more respect on the field from players who are privileged to live in the greatest country on earth.

via http://ift.tt/2haCYIs Tyler Durden

A few weeks ago we wrote a post entitled “How Hermitage Capital, Ziff Brothers And The Clinton Global Initiative Prompted The Trump Jr. Meeting.”  To make a long story short, there is a long-standing feud between the founder of Hermitage Capital, William Browder, and the now infamous Russian lawyer, Natalia Veselnitskaya, who met with Trump Jr. last summer.  Browder, on the one hand, lobbied in favor of the Magnitsky Act after being expelled from Russia under controversial circumstances while Veselnitskaya has made it her life’s mission to repeal the Magnitsky Act.

So, when Democrats decided to haul Browder before the Senate Judiciary Committee yesterday, they likely expected the anti-Russian witness to confirm that Russian intelligence was behind the Summer 2016 meeting between Veselnitskaya and Trump Jr. and that the meeting really had nothing to do with the Magnitsky Act but rather was a carefully-plotted, nefarious attempt to collude with the Trump campaign to steal the 2016 election from Hillary Clinton. 

Unfortunately, at least for the Dems, he failed to deliver.  In fact, Browder delivered the exact opposite message from what the Democrats had hoped for as he confirmed that the Trump Jr. meeting was entirely linked to Veselnitskaya’s life mission of repealing the Magnitsky Act. 

But, Browder offered up an even more interesting tidbit of information, a tidbit that has been completely ignored by the mainstream media, that served to undermine the left’s entire ‘Russian collusion’ narrative when he confirmed that Fusion GPS, the now infamous firm behind the ‘Trump Dossier’, was actually being paid by….wait for it….the Russians.

While we’re certainly not experts on the intricacies of international espionage, it does seem weird that if your sole mission in life is to ‘collude’ with the Trump administration to defeat Hillary Clinton that you would simultaneously fund research intended to undermine the Trump campaign and then share that information with the FBI.

Here is the relevant exchange between Lindsey Graham and William Browder:

Graham: You believe that Fusion GPS should of registered under FARA, because they were acting on the behalf of the Russians?

 

Browder: That’s correct.

 

Graham: So, I just want to absorb that for a moment. The group that did the dossier on President Trump hired this British spy, wound up getting it to the FBI. You believe they were working for the Russians?

 

Browder: And in the Spring and Summer of 2016 they were receiving money indirectly from a senior Russian government official.

 

Graham: Okay. So, these are the people that were trying to undermine Donald Trump by showing the nefarious ties to Russia. Is that what you’re saying?

 

Browder: Well, what I’m saying with 100% certainty is that they were working to undermine the Magnitsky act and the timing of that.

 

Graham: But, the Fusion GPS products apparently as they hired a guy to look into Trump?

 

Browder: Yes.

 

Graham: Right.

 

Browder: Correct.

 

Ironically, as Sarah Sanders pointed out at yesterday’s White House press briefing, not a single reporter from the mainstream media, the folks that have reported on ‘Russian meddling’ 24/7 for the past year, bothered to ask a question about this new evidence that the Russians conspired to undermine the U.S. election….wonder why?

“You guys love to talk about Russia. There’s been nonstop coverage, and the one day that there might have been a question on Russia, there wasn’t. 

 

“Today there was public testimony that further discredited the phony dossier that’s been the source of so much of the fake news and conspiracy theories, and we learned that the firm that produced it was also being paid by the Russians.”

 

“This is yet the latest piece of evidence that vindicates what the president has said: that this is a witch hunt and a hoax. And it’s a shame that the president and the country have had to go through this charade continually. And hopefully this will help us move forward in that process.”

via http://ift.tt/2v4U0gR Tyler Durden

Authored by MN Gordon via EconomicPrism.com,

On a warm Friday Los Angeles morning in spring of 2016, we found ourselves standing at the busy corner of Wilshire Boulevard and South Figueroa Street.  We were walking back to our office following a client wire brushing for events beyond our control.  But we had other thoughts on our mind.

Amongst a mob of pedestrians, we gazed up at the skeleton frame of what would become the Wilshire Grand Center.  For the first time in several years the buzz and hum of diligent building activity was eerily silent.  In fact, construction efforts were shut down for the day.

Sadly, less than 24 hours earlier a distraught electrician had taken a swan dive off the 53rd floor.  The man’s death prompted an immediate work stoppage and evacuation of the tower.  “It sounded like a bag of cement fell off the edge of the building,” one observer remarked.

Naturally, the sound of impact was far too grim for us to contemplate.  Instead, we wondered how time must have simultaneously slowed down and sped up for the jumper as they descended toward the ground.  Did they want a redo before it was game over?

We have a hunch that over the next couple of years, vast numbers of people are going to experience the rush that comes when time simultaneously slows down and speeds up.  Not because they’ve committed a base jump off a skyscraper – though some will.  Rather, it’ll occur at the precise moment they come to the rude realization that they’re broker than broke.

We’ll have more on this in just a moment.  But first some context is in order…

A Grand Ego Stroke

Several weeks ago the Wilshire Grand Center officially opened.  The building claims to be the new tallest building in Los Angeles, and tallest building west of the Mississippi.  But we have some reservations.

Because the top of the Wilshire Grand Center is actually about 18 feet shorter than the U.S. Bank Tower that’s several blocks away.  However, there’s a bizarre looking 100-foot spire at the building’s peak.  Apparently, this spire has a very determined purpose.

Per the Council of Tall Buildings and Urban Habitat – if you can believe there is such a thing – a spire is considered an architectural feature and is, thus, counted when measuring the building’s 1,100 foot height.  Tall buildings arbiters’ aside, we ain’t buying it.  But our opinion on the matter doesn’t matter.

Korean Air / Hanjin Group financed construction of the Wilshire Grand Center.  The claim that this is the new tallest building west of the Mississippi, regardless of spire gimmickry, offers Korean Air Chairman Yang Ho Cho a grand ego stroke.  We recommend that he enjoys it now before he rues it.

You see, the construction of marque skyscrapers has an uncanny track record of coinciding with the late stages of an artificial, cheap credit induced building boom.  If this holds true, the Wilshire Grand Center will forever be a monument to ZIRP, NIRP, and QE.  What’s more, there are several other new skyscrapers monuments that’ll be opening their doors real soon.  This can only mean one thing…

Views from a Top of the Skyscraper Index

The skyscraper index was first elaborated by Andrew Lawrence in January 1999.  The idea is simple enough.  The world’s tallest buildings are often completed on or around the onset of economic downturns.

What the skyscraper index does is it accounts for the long lead time that massive ego stroke projects like construction of the tallest building in the world take to come to fruition.  By the time these mega edifices are complete the free flowing credit that bubbled up their construction, and other bubbles throughout the economy, has nearly exhausted itself.  This is about the time the boom turns to bust and the economy slips into recession.

For example, the Burj Khalifa in Dubai, which is the tallest building in the world at 2,126 feet, was completed in 2008.  If you recall, this was shortly after the onset of the Great Recession.  The cheap credit that pumped up the Burj Khalifa was the same cheap credit that pumped up the U.S. residential real estate bubble.

At the moment, several other tallest building records that dwarf the Wilshire Grand Center are nearing completion.  The first being the Central Park Tower in New York, which upon opening its doors in 2019 will be the new tallest building in the United States at 1,550 feet.  The second being the Jeddah Tower in Saudi Arabia, which will be completed in 2020 and will be the new tallest building in the world at an insane height of 3,281 feet.

Based on the open date of the Central Park Tower and the Jeddah Tower, the Wilshire Grand Center may be an early indicator of the approaching panic.  The timing is hard to precisely pin down.

But what is clear is where the credit has come from to pump up these grand ego strokes.  It has come from precisely the same place where the credit that has boosted world stock indexes to record heights has come from.  Mass central bank balance sheet expansion and zero to negative interest rates.

These asset price inflation puffers are always fleeting.  Views from a top of the skyscraper index show a coming day when time simultaneously slows down and speeds up in a great manic panic.  This is the day the debt edifice crumbles.  Why wait to get your financial house in order?

via http://ift.tt/2vRn0Gq Tyler Durden

After being forced to recuse himself from his committee’s investigation of the ‘Russian meddling’ controversy earlier this year (see: House Intel Committee Chair Nunes Recuses Himself From Russia Probe), Devin Nunes has thrust himself back into the national spotlight by drafting a letter to the Director of National Intelligence, Dan Coats, saying he has evidence that several of Obama’s top political aides made hundreds of unmasking requests in the waning days of Obama’s administration even though they offered no legitimate reason to do so and some of them didn’t even serve in an intelligence position.

In Thursday’s letter, Nunes said the total requests for Americans’ names by Obama political aides numbered in the hundreds during Obama’s last year in office and often lacked a specific intelligence community justification. He called the lack of proper justifications a “serious deficiency.”

 

His letter noted requests from senior government officials, unlike career intelligence analysts, “made remarkably few individualized justifications for access” to the U.S. names.

 

“The committee has learned that one official, whose position had no apparent intelligence related function, made hundreds of unmasking requests during the final year of the Obama administration,” Nunes wrote. “Of those requests, only one offered a justification that was not boilerplate.”

 

“We have found evidence that current and former government officials had easy access to U.S. person information and that it is possible that they used this information to achieve partisan political purposes, including the selective, anonymous leaking of such information.”

 

Of course, we pointed out last week (see: New Scapegoat Emerges In Unmasking Scandal: Meet Obama’s Former U.N. Ambassador Samantha Power) that the official “whose position had no apparent intelligence related function” was likely Obama’s U.N. ambassador, Samantha Power.

Power appears to be central to efforts by top Obama administration officials to identify individuals named in classified intelligence community reports related to Trump and his presidential transition team.  If true, Power’s role in the unmasking efforts would be particularly questionable since it’s nearly inconceivable that her position as the U.N. ambassador would require such sensitive unmasking activities.

 

“Unmasking is not a regular occurrence—absolutely not a weekly habit. It is rare, even at the National Security Council, and ought to be rarer still for a U.N. ambassador,” according to one former senior U.S. official who spoke to the Washington Free Beacon.

 

“It might be defended when the communication in question relates directly to U.N. business, for example an important Security Council vote,” explained the former official, who would only discuss the matter on background. “Sometimes it might be done out of other motives than national security, such as sheer curiosity or to defend a bureaucratic position. Or just plain politics.”

 

The Intelligence Committee’s focus of Power and other key Obama officials is a prime example of the Obama administration’s efforts to spy on those close to Trump, according to sources familiar with the ongoing investigation.

 

“The subpoena for Power suggests just how pervasive the Obama administration’s spying on Americans actually was,” said one veteran GOP political operative who has been briefed on the matter by senior Congressional intelligence officials. “The U.N. ambassador has absolutely no business calling for the quantity and quality of the intelligence that Power seems to have been asking for.”

 

“That’s just not the sort of thing that she should have been concerned about, unless she was playing the role of political operative with the help of the intelligence community,” the source said. “It gives away what was actually going on: the Obama administration was operating in a pervasive culture of impunity and using the intelligence community against their political opponents.”

So, you’re saying that while Americans were being distracted with a barrage of “Russian meddling” stories, that Obama was working behind the scenes to transform our various intelligence agencies in this country into his very own political weapons of mass destruction? 

That sounds like a very serious 4th Amendment issue…we’re starting to see what the FISA courts were getting at:

“Since 2011, NSA’s minimization procedures have prohibited use of U.S.-person identifiers to query the results of upstream Internet collection under Section 702.  The October 26, 2016 Notice informed the Court that NSA analysts had been conducting such queries in violation of that prohibition, with much greater frequency than had previously been disclosed to the Court.”

 

“At the October 26, 2016 hearing, the Court ascribed the government’s failure to disclose those IG and OCO reviews at the October 4, 2016 hearing to an institutional ‘lack of candor’ on NSA’s part and emphasized that ‘this is a very serious Fourth Amendment issue.'”

via http://ift.tt/2uKBNCP Tyler Durden

Authored by Mike Krieger via Liberty Blitzkrieg blog,

There is a true law, a right reason, conformable to nature, universal, unchangeable, eternal, whose commands urge us to duty, and whose prohibitions restrain us from evil. Whether it enjoins or forbids, the good respect its injunctions, and the wicked treat them with indifference. This law cannot be contradicted by any other law, and is not liable either to derogation or abrogation.

 

Neither the senate nor the people can give us any dispensation for not obeying this universal law of justice. It needs no other expositor and interpreter than our own conscience. It is not one thing at Rome and another at Athens; one thing today and another tomorrow; but in all times and nations this universal law must for ever reign, eternal and imperishable. It is the sovereign master and emperor of all beings. God himself is its author,—its promulgator,—its enforcer. He who obeys it not, flies from himself, and does violence to the very nature of man. For his crime he must endure the severest penalties hereafter, even if he avoid the usual misfortunes of the present life.

 

– Marcus Tullius Cicero

There’s been a lot going on this week, so it’s unsurprising that an extremely important vote in Congress failed to get the attention it deserves. What I’m referring to is the recent Russia/Iran/North Korea sanctions bill passed by the House of Representatives in a frighteningly lopsided 419-3 vote.

Let’s turn to Bloomberg for a quick analysis on the Russian reaction:

To summarize, the entire House of Representatives other than three Republicans, Justin Amash of Michigan, Thomas Massie of Kentucky, and John Duncan of Tennessee, voted for this thing. Not a single Democrat voted against the sanctions.

We supposedly live in a “representative democracy,” but 99% of our so-called representatives voted for this bill. Does this really represent the will of 99% of the public? These are the kind of numbers you’d expect to see in totalitarian states, and the ironic thing is the vote was driven by a desire to put a stop to supposedly fascist Trump. We’ve got much bigger problems than Trump.

Michael Tracey put it perfectly on Twitter earlier today:

The complete conformity of views in the political/media class re: sanctions — virtually no dissent at all — should be a major warning sign

— Michael Tracey (@mtracey) July 26, 2017

As troubling as the bill is for relations with nuclear armed Russia where tensions are already high, the response from European allies is arguably more concerning.

As much as I hate to quote CNN, it actually published a pretty good article on the subject. Here’s some of it:

The European Union has delivered a stern warning to the US over a plan to impose new sanctions on Russia, opening up the prospect of a rift between the two allies over how to deal with Moscow’s foreign interventions.

 

EU President Jean-Claude Juncker said the bloc would act “within days” if it does not receive reassurances on the potential impact of new sanctions on European interests.

 

The EU has previously coordinated with the US over sanctions in response to Russia’s annexation of Crimea from Ukraine. But it fears the latest measures could hit companies that are involved in the financing of a controversial new pipeline, Nord Stream 2, that would carry natural gas from Russia to Germany.

 

Juncker said the bill could have “unintended unilateral effects” on the EU’s energy security. “This is why the Commission concluded today that if our concerns are not taken into account sufficiently, we stand ready to act appropriately within a matter of days,” Juncker said. “America first cannot mean that Europe’s interests come last.”

 

Germany, which strongly backs the new pipeline, said it was concerned over the sanctions. It would be “unacceptable for the United States to use possible sanctions as an instrument to serve the interests of US industry policies,” Foreign Ministry spokesman Martin Schäfer said Wednesday.

 

France called the US bill “unlawful” due to its “extraterritorial reach,” saying it could impact Europeans if enacted. “We have challenged similar texts in the past,” the Foreign Ministry said in a statement. “To protect ourselves against the extraterritorial effects of US legislation, we will have to work on adjusting our French and European laws.”

 

The European Union expressed frustration that it had not been consulted over the new proposals. “New sanctions should always be coordinated between allies,” EU President Jean-Claude Juncker said in a statement.

 

The EU and the US imposed coordinated sanctions in 2014 over Russia’s annexation of Crimea from Ukraine. President Barack Obama imposed further sanctions in late 2016 over alleged interference in the 2016 US election. Sanctions were also imposed under the 2012 Magnitsky Act, which targets Russians whom the US considers human rights abusers.

These are major EU allies furious with this bill, which makes you ask the obvious followup question. Did 99% of the House of Representatives not realize the implications of what they were voting for in their blind rage against Russia? If so, these people are extremely dangerous and have no business making important decisions for 320 million of us.

This is exactly how empires implode. Corrupt, power-drunk , disconnected elites living in an echo chamber of hubris always destroy everything in their path at the end of a geopolitical cycle. First they lose the trust of their own people (this has already happened), and then they lose the trust of their allies. This last part is happening rapidly and it’s moving much faster than even I imagined.

Unless something major changes we have to assume the U.S. empire is going down, and need to start thinking about what a post-imperial America can look like. There are countless dangers in such a scenario, but also many opportunities for a vastly improved and freer society.

via http://ift.tt/2v4L1MM Tyler Durden

After Thursday’s bizarre, widely publicized breakdown by Anthony Scaramucci, Trump had no choice: he had to pick: the former SkyBridge founder or Reince Priebus.

Moments ago Trump made his decision:in tweeting moments ago, Trump said, “I am pleased to inform you that I have just named General/Secretary John F Kelly as White House Chief of Staff. He is a Great American and a Great Leader. John has also done a spectacular job at Homeland Security. He has been a true star of my Administration.”

I am pleased to inform you that I have just named General/Secretary John F Kelly as White House Chief of Staff. He is a Great American….

— Donald J. Trump (@realDonaldTrump) July 28, 2017

…and a Great Leader. John has also done a spectacular job at Homeland Security. He has been a true star of my Administration

— Donald J. Trump (@realDonaldTrump) July 28, 2017

Trump also tweeted his token thanks to Priebus “for his service and dedication to his country” saying “we accomplished a lot together and I am proud of him!.”

I would like to thank Reince Priebus for his service and dedication to his country. We accomplished a lot together and I am proud of him!

— Donald J. Trump (@realDonaldTrump) July 28, 2017

How Trump’s decision will be greeted by the more moderate part of his base, remains to be seen, although with Trump siding against Priebus, it may mean that Bannon may be next, a move which would infuriate the core of Trump’s electorate: a material gamble for a president with a precarious approval rating.

As for retired Gen. John Kelly, Retired he was in the military for 45 years – a very long time, even for a general. He was once the head of US Southern Command, putting much of the US’ immediate vicinity under his purview – including the control of Guantanamo Bay.

As WaPo’s Robert Costa writes, “Kushner and Bannon both really like Kelly, which made the decision easier. Someone who has appeal to the two main blocs in WH…”

His full bio is below.

General Kelly was born and raised in Boston, MA. He enlisted in the Marine Corps in 1970, and was discharged as a sergeant in 1972, after serving in an infantry company with the 2nd Marine Division, Camp Lejeune, NC. Following graduation from the University of Massachusetts in 1976, he was commissioned and returned to the 2nd Marine Division where he served as a rifle and weapons platoon commander, company executive officer, assistant operations officer, and infantry company commander. Sea duty in Mayport, FL, followed, at which time he served aboard aircraft carriers USS Forrestal and USS Independence. In 1980, then Captain Kelly transferred to the U.S. Army’s Infantry Officer Advanced Course in Fort Benning, GA. After graduation, he was assigned to Headquarters Marine Corps, Washington, DC, serving there from 1981 through 1984, as an assignment monitor. Captain Kelly returned to the 2nd Marine Division in 1984, to command a rifle and weapons company. Promoted to the rank of Major in 1987, he served as the battalion’s operations officer.

 

In 1987, Major Kelly transferred to the Basic School, Quantico, VA, serving first as the head of the Offensive Tactics Section, Tactics Group, and later assuming the duties of the Director of the Infantry Officer Course. After three years of instructing young officers, he attended the Marine Corps Command and Staff College, and the School for Advanced Warfare, both located at Quantico. Completing duty under instruction and selected for Lieutenant Colonel, he was assigned as Commanding Officer, 1st Light Armored Reconnaissance Battalion, 1st Marine Division, Camp Pendleton, CA. Holding this command position for two years, Lieutenant Colonel Kelly returned to the East Coast in 1994, to attend the National War College inWashington, DC. He graduated in 1995, and was selected to serve as the Commandant’s Liaison Officer to the U.S. House of Representatives, Capitol Hill, where he was promoted to the rank of Colonel.

 

In 1999, Colonel Kelly transferred to joint duty and served as the Special Assistant to the Supreme Allied Commander, Europe, in Mons, Belgium. He returned to the United States in 2001, and was assigned to a third tour of duty at Camp Lejeune, now as the Assistant Chief of Staff G-3 with the 2nd Marine Division. In 2002, selected to the rank of Brigadier General, Colonel Kelly again served with the 1st Marine Division, this time as the Assistant Division Commander. Much of Brigadier General Kelly’s two-year assignment was spent deployed in Iraq. He then returned to Headquarters Marine Corps as the Legislative Assistant to the Commandant from 2004 to 2007. Promoted to major general, he returned to Camp Pendleton as the Commanding General, I Marine Expeditionary Force (Forward). The command deployed to Iraq in early 2008 for a year-long mission, replacing II Marine Expeditionary Force (Forward) as Multinational Force-West in Al Anbar and western Ninewa provinces. LtGen Kelly commanded Marine Forces Reserve and Marine Forces North from October 2009 to March 2011. General Kelly comes to United States Southern Command from his previous position as the Senior Military Assistant to the Secretary of Defense from March 2011 to October 2012.

via http://ift.tt/2tKnpJp Tyler Durden

Having broken up with "fucking paranoid" Priebus and "cocksucker" Bannon yesterday in an expletive-filled rant to a New Yorker mag reporter, the newly-appointed White House communications director – and alleged all round hatchet boy – has an even bigger relationship problem.

As PageSix reports, the political ambitious former FOFer has been been dumped by his blonde wife because of his “naked political ambition,” according to multiple sources. Deidre Ball, who worked as a vice president in investor relations for SkyBridge Capital, the firm he founded in 2005 and sold to ascend to the White House, has filed for divorce from “The Mooch” after three years of marriage after getting fed up with his ruthless quest to get close to President Trump, whom she despises.

One source told Page Six, “Deidre has left him and has filed for divorce.

…She liked the nice Wall Street life and their home on Long Island, not the insane world of D.C.

 

She is tired of his naked ambition, which is so enormous that it left her at her wits’ end.

 

She has left him even though they have two children together.”

Scaramucci and Ball, 38, began dating in 2011 and are believed to have married in 2014. This was his second marriage and Ball was noticeably not present at his recent SALT conference in mid-May. She went by the Twitter handle @MrsAScaramucci but is said to have deleted her account after her husband was appointed as White House Communications Director.

A second source close to Scaramucci – who has alternately not been wearing his wedding ring, or has been sporting it on his right hand – said the former couple had fought over his loyalty to Trump. The source said,

“Deidre is not a fan of Trump, and she hasn’t exactly been on board and supportive of Anthony and his push to get back into the White House.”

* * *

University of Buffalo graduate Ball donated $5,400 to the congressional campaign of anti-Trump Democrat Kathleen Rice in 2015. But she also donated $10,800 to Wisconsin Governor Scott Walker’s presidential campaign and $2,700 to Jeb Bush’s campaign the same year.

So with everyone around the Mooch cutting off the erratic communications director, how long until the only person that matters, Trump himself, follows suit?

via http://ift.tt/2hagsiZ Tyler Durden

Authored by Lance Roberts via RealInvestmentAdvice.com,

Ah…yes. It is FINALLY that time of the year when I take a week off with the family for our summer vacation.

Don’t worry, I have been fiendishly writing for the past two weeks and have blog posts all ready to go for next week. You won’t left hanging.

However, let me just leave you today with one parting thought.

The chart below is the S&P 500 on a WEEKLY basis going back to 1992. While it is clear the bullish trend is currently intact, which suggests the markets could indeed rise further, the deviation from the 1-year moving average is pushing more historical extremes.

Furthermore, the two circles on the lower part of the chart show the longer-term “buy/sell” signals which have been historically accurate in adjusting risk in portfolios. As you will notice, just like in late 1998 and early 1999, there was a sell signal which was reversed WITHOUT the market dropping into a bear market. The subsequent rally pushed asset prices and valuations to extremes in early 2000.

I don’t need to remind you what happened next. 

Currently, we see the same build up in exuberance, leverage, and speculation. The sell signal in 2015/2016 has been reversed following the Trump election. More importantly, just like in 1999, the indicators are running at historically very high levels.

I probably don’t need to remind you what will happen next. 

It is just a function of time.

In the meantime, the bullish trend remains intact. So, we participate for now but we do so with a high level of caution and very tight stop losses.

So, with that said, this is what I will be reading on vacation.

---

Politics/Fed/Economy

• The Greater Moderation by Danielle DiMartino-Booth via Money Strong
• Partisan Conflict Is High by Jeff Sommer via NYT
• Fed To Start Unwinding Balance Sheet Soon by Akin Oyedele via BI
• Democrats Try To Rebrand Themselves As Populists by Caroline Baum via MarketWatch
• New Math Fetish Has Turned Economics Into Astrology by Alan Jay Levinovitz via Aeon
• Gary Cohn Is The Wrong Choice For The Fed by John Tamny via Forbes
• Is The Economy Really Different This Time by Joe Calhoun via Alhambra Partners
• 4-Signs The Economy Is Stalling by Stephen McBride via Mauldin Economics
• The False Premise Of GOP Tax Cuts by Editorial via New York Times
• Draghi Did Not Keep His Promise by Jeffrey Snider via Alhambra Partners
• Fed Won’t Raise Rates Until Christmas by Pedro Da Costa via BI
• All Signs Point To Slowdown In Inflation by Lakshman Achuthan via Bloomberg
• The Quiet Demise Of Austerity by James McCormack via Project Syndicate

---

Markets

• What You Should Be Worried About by Mark Hulbert via MarketWatch
• Howard Mark’s Bubble Checklist by Tyler Durden via ZeroHedge
• How To Survive The Coming Market Storm by Richard Harris via South China Morning Post
• ETF’s Are The Biggest Danger To Markets by The Heisenberg via Seeking Alpha
• Byron Wein Says Market In Uncharted Territory by Joe Ciolli via BI
• Will Perma-Bears Ever Learn by Taylor Dart via Seeking Alpha
• USD Breakdown, What Next? by Erik Swarts via Market Anthropology
• USD Close To The Edge Of The Cliff by Michael Kahn via Barron’s
• Wall Street Is Bracing For A Significant Correction by Steve Liesman via CNBC
• Stunning Lack Of Declines Highlights Surreal New Normal by Wolf Richter via Wolf Street
• Earnings Outlooks Falling Rapidly by Anora Mahmudova via MarketWatch
• Why Financials Can’t Lead The Market Higher by Bryce Coward via Knowledge Leaders
• Over-valuation Not Due To Passive Investing by David Merkel via The Aleph Blog
• Stock Market Bulls Are Wrong, It Will End Badly by Doug Kass via The Street
• This Is Why It’s So Hard To Be A Contrarian by Stefan Cheplick via Medium

---

Research / Interesting Reads

• Risk Has Been Abolished by Wolf Richter via Wolf Street
• There They Go Again by Howard Marks via OakTree Capital
• Perceived Vs. Real Risk Tolerance by David Merkel via The Aleph Blog
• Dividend Cuts Accelerate In Q3 by Political Calculations
• 3-Examples To Consider In Retirement Planning by Paul Brown via NYT
• The Next Housing Bubble Is Here by Mark Hanson via Zero Hedge
• FLASH CRASH: Seth Klarman Weighs In On HFT by Jody Chudley via Daily Reckoning
• 7-Habits To Help Your Kids Be Successful by Vanessa McGrady via Forbes
• The Reason Everyone Resents Millennials by Bill Murphy Jr via Inc.
• Student Borrowers Face Relentless Debt Collector by Michelle Conlin via Reuters
• Taking Money Off The Table Is The Best Investment by Michael Douglas via Motley Fool
• Maybe We Are Thinking About Productivity All Wrong by Neil Irwin via NYT
• If The Stock Market Makes You Rich, Why Are So Many Poor? by Me via Market Watch
• Singer: “I’m Very Concerned About The Global Economy by Tyler Durden via ZeroHedge
• The Salient Features Of Past Bull Market Peaks by John Hussman via Hussman Funds
• Breakout Barrage – Is It Really Bullish? by Dana Lyons via Tumblr
• Podcast: William White On Experimental Monetary Policy by Jesse Felder via The Felder Report

---

 “Sometimes buying early on the way down looks like being wrong, but it isn’t.” – Seth Klarman

via http://ift.tt/2ha1uK0 Tyler Durden