Elizabeth Nolan Brown on the Latest Campus Assaults on Free Speech

“Free speech all the time. Not just when admin
says when, where, what about,” read one side of the neon-yellow
sign fielded by Ali Cohen, an education major at Coastal Carolina
University, during a recent campus rally.

Cohen is one of a handful of Coastal students facing disciplinary action for
sidewalk chalk
 messages protesting racial injustice and
the non-indictment of Ferguson police officer Darren Wilson. Three
of the students—those caught in the act—were handcuffed and
detained by CCU police. The university said it will not be pursing
criminal charges, but Cohen and her chalk co-conspirators have been
charged with violations of the university’s conduct code, including
vandalism and “unauthorized usage/entry.” 

The situation at Coastal echoes other recent conflicts between
university administrations and student activists, notes Elizabeth
Nolan Brown. Across the country, student activism has been on an
upswing. But with it has come increased efforts to suppress speech
and exert control from college adminstrators. 

View this article.

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Greenpeace Ruined an Ancient Peruvian Landmark, Crazy Students Chased Peter Thiel Off Stage, Republicans vs. the IRS: P.M. Links

  • Peter ThielGreenpeace has apologized for an unbelievable
    recent stunt in which activists desecrated the 2,000-year-old

    Nazca lines
    .
  • Google is
    considered
    one of the best places to work. Too bad Spain is
    going to miss
    out
    .
  • Angry students
    interrupted
    Peter Thiel’s speech at the University of
    California, Berkeley. Thiel was chased off stage as a “Black Lives
    Matter” protest began.
  • Reining in the IRS is a
    top priority
    for Congressional Republicans in the coming
    year.
  • CIA Director John Brennan
    says
    we’ve had enough of all that silly transparency business.
    “Over the top transparency,” he called it.
  • The 2015 Golden Globe nominations
    were announced
    .

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Cromnibust! Hindenburg Cluster Grows As Crude, Credit, & US Government Credibility Crash

Because everyone knows…

 

Yet another Hindenburg Omen today… (note yesterday's very late crash in stocks managed to invalidate one of the indicators factors but the cluster remains unviolated overall)…

 

With America's politicians apparently unable to agree on the Cromnibus Bill and government shutdown looming, weakness in crude oil, contagion in high-yield credit, and an extremely aggessive 30Y bond auction trumped the retail sales headlines (massively seasonally-adjusted as they were).

 

There was very significant volume in the Dec S&P 500 e-mini contract today…

 

The key for today's markets was to ensure The Lending Club IPO broke for trading successfully… once that was achieved, this happened…

 

As WTI broke below $60…

 

VIX broke 20…

 

And Energy stocks pumped-and-dumped back down to energy credit… as HY Energy hit 950bps

 

Stocks did their usual bounce in the last hour but even that failed as even spurious Japanese headlines juicing JPY, stocks sold off…

 

On the week, Energy continues to lag with only utilities green…

 

Treasury yields rose on the day at the short-end but gave a lot back when the 30Y auction was so well bid ex dealers…

 

 

The USDollar gained ground after 3 days of weakness but remains down around 1% on the week. JPY was a big mover today as it tried to rescue stocks…

 

Copper, Gold, and Silver pretty much flatlined on the day as crude dead-cat-bounced off $60 early but broke late…

 

 

Quite a day across asset classes…

 

Charts: Bloomberg




via Zero Hedge http://ift.tt/12SvTzP Tyler Durden

“When The Market Moves Fast, Stuff Blows Up”

Authored by 10th Man's Jared Dillian, originally posted at Mauldin Economics,

One of my old rules of trading is that whenever a major asset class, index, or other benchmark has a sudden, rapid move in price, something blows up. Sky high.

That’s because people get used to regimes. They get used to a certain state of affairs with a lack of volatility. They become complacent. Maybe they stop hedging. Maybe they allow themselves to have unbounded downside risk. Maybe they start gambling.

In the last month, we’ve seen massive moves in the dollar and oil—and I assure you, someone is going to get hurt.

So far I haven’t said anything controversial. Energy companies are going to get hurt by lower oil prices. Exporters are going to get hurt by a rising dollar. A chimpanzee could figure this out.

But there are second-order effects. People are starting to figure out that Canadian banks are going to get hurt by the lack of investment banking business from the energy sector, and the stocks are getting punished.

And there are third-order effects too, which people will soon discover.

If you sit around and think hard enough, you can make these sorts of connections. Some people are very good at this. A commodity price moves fast, and they can figure out the point of maximum pain for some company far down the supply chain from the actual commodity.

I’m not that smart. But I’m smart enough to get out of the way when something big and important like oil moves 40%.

Let’s step into our time machine and set the dial to 1994. That was the year when interest rates backed up a couple of percentage points. Remember the bond market vigilantes? They were pricing in Hillarycare and a Democratic Party wish list, and they caned the bond market until interest rates were making borrowers squeal.

But what was interesting about 1994 was that in the grand scheme of things, interest rates didn’t go up all that much. Just a couple of percentage points. Now, if I asked you who you thought would get hurt by rising rates, you might say banks, hedge funds. And you would be wrong. Who got hurt by rising interest rates?

  • Procter & Gamble.
  • Orange County, CA.
  • Mexico.

Why did the first two blow up? Derivatives.

By the way, I’m not referring to derivatives pejoratively. I’ve spent most of my adult life trading them. They’re not financial weapons of mass destruction. What they do is take risk over here and move it over there. So if bank XYZ was negatively exposed to higher interest rates, they were able to offset that exposure to Orange County through derivatives.

Of course, the derivatives Orange County was trading were very exotic and clearly unsuitable for a municipality, but that’s a discussion for another time over a burger and a beer. The point is that rates moved, and they moved fast, and stuff blew up.

But not the stuff you thought would blow up.

Buying Volatility on the Cheap

So I know what you’re going to ask me next: What’s going to blow up?

Who knows? By definition, you can’t know, especially when the risk has been laid off through derivatives.

But this is how it works: Oil moves 40%, the dollar moves 10-15%, and someone’s out of business. It could be someone big. It could be someone systemically important, someone that could really spook the markets. So when stuff like this happens, I get myself exposure to things that gain from disorder (paraphrasing Black Swan author Nassim Taleb).

With the S&P 500 Index (SPX) at 2,050 and the CBOE’s Volatility Index (VIX) at about 15, systemic risk is vastly underpriced.

I’m not saying that stocks are too high, that I’m bearish. I’m just saying that the derivatives markets aren’t pricing in what could be a big unwind based on these oil and dollar moves.

Translation: volatility is cheap.

Is $60 oil bullish for stocks, long term? Absolutely. It is one of the most bullish things I can think of. One of my clients recently told me that this decline in oil will result in $100,000 in annual fuel savings for his business. Multiply that times everyone. So bullish. And the dollar, also long-term bullish. But in the short term, there’s an Amaranth out there somewhere, potentially.

Maybe it’s not a hedge fund. Maybe it’s a company like Coca-Cola (KO) that gets the majority of its earnings from overseas. Maybe it’s the railroads. The person who can figure this out wins the prize.

As I said before, I’m not that smart… just a former trader with scabs on his knuckles. But the funny thing about those traders—especially the ones over 40—is they have a nose for trouble. I’m all in favor of bullish developments, just not when they happen really fast and nobody is ready, which is how people get maimed.

Position: long three-month SPY puts, short Canadian Imperial Bank of Commerce (CM) and Toronto-Dominion Bank (TD) (the US-listed shares).




via Zero Hedge http://ift.tt/1yEaDvI Tyler Durden

Little Rock Cops Want Immunity for Shooting 67-Year-Old Man While Working Private Security

Eugene EllisonTwo Little Rock, Arkansas, police officers who
shot and killed 67-year-old Eugene Ellison in his apartment after
investigating an open door while working private security for the
apartment building have been trying to claim immunity in the
shooting. They are now
appealing
a judge’s decision to deny them immunity in an
ongoing lawsuit by Ellison’s family. The family held a press
conference earlier this week, as
reported by KATV
:

The press conference was also held four years to the day since
Ellison was shot by Officers [Donna] Lesher and [Tabatha] McCrillis
in his apartment on Colonel Glenn Road on December 9, 2010. The two
officers were allegedly investigating an open door into Ellison’s
apartment, and apparently an altercation took place once the
officers entered the residence. According to police reports,
Ellison had apparently come at the officers with a walking
cane. 

“What the city is trying to do is conflate the fight with the
shooting,” said Michael Laux, attorney for the Ellison family.
“It’s very important to understand that however bad this fight was
– and we have to take the officer’s word for that – it was over…
long over by the time they shot Mr. Ellison.” 

One of Ellison’s son is a police officer with the Little Rock
police and claims he’s been retaliated against for his family’s
lawsuit, including being moved to a midnight shift.

In 2012, the Department of Justice said it would
look into the shooting
but nothing appears to have happened.
Two years later, and four years after the shooting, the Ellison
family
continues to press
the feds to investigate the shooting. The
family hopes renewed attention to police violence improves their
lawsuit’s chances of success.

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There Are Interviews with CIA Officials Regarding Torture, and the White House is Hiding Them

Transparency and accountability, watchwords of ... ha, ha, ha, just kidding.When the Senate’s
report on enhanced interrogation and torture
was released
earlier this week, one of the immediate defensive talking points
from the CIA was that the Senate
did not interview
any of their employees. The Senate report
makes note of this issue in a footnote, saying that the CIA
wouldn’t require its staff to cooperate and attributed it to a
Department of Justice investigation.

Just before that footnote is an additional note that the White
House also withheld thousands of documents from the Senate
investigation, claiming executive privilege. Brian Doherty
wrote about that detail
Tuesday.

Apparently among those documents are interviews with about 100
witnesses with information about the interrogation program. The
New York Times
has
filed a lawsuit
to try to get access to these reports to see
why no charges have been filed as a result of the investigation.
The White House is fighting having to disclose the records:

The Obama administration has
urged a court
to reject a request to disclose thousands of
pages of documents from a Justice Department investigation into the
torture of detainees by the Central Intelligence Agency, including
summaries of interviews with about 100 witnesses and documents
explaining why in the end no charges were filed

The administration made the filing late Tuesday in response to a
Freedom of Information Act
lawsuit brought by The New York Times
, hours after the Senate
Intelligence Committee made public a 524-page executive summary of
its own investigation into C.I.A. torture. The committee based its
report on a review of C.I.A. documents but did not conduct any
interviews.

The Justice Department materials, the court filing revealed,
include 10 reports and memorandums totaling 1,719 pages — more than
three times the number of pages in the Senate report released
Tuesday — as well as “numerous” pages of reports on interviews with
current and former C.I.A. officials.

According to the Times, the Justice Department is
fighting the release of the documents because it would “affect the
candor of law enforcement deliberations about whether to bring
criminal charges.”

Read more
here
. CIA Director John Brennan gave a press conference this
afternoon essentially going over the same points used in the
agency’s
official response
(pdf) to the Senate report. When a reporter
asked him directly if he thought destroying video tapes of
interrogations had been appropriate, he vaguely responded that
people “took actions at the time that they believed were the right
thing to do. Let’s leave it at that.” If those are the kind of
responses to expect, what exactly were Senate staffers going to get
from their own interviews anyway?

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WTF Chart Of The Day: Explaining The Surge In US Retail Sales

Confused at how such awesome retail sales headlines can lead to the kind of weakness we are seeing in stocks now that Lending Club’s IPO has started trading? Wondering why bonds are now lower in yield on the day in the face of ‘proof’ that the US consumer is back? Wonder no more, as STA Wealth Management’s Lance Roberts points out, November’s seasonal adjustment for retail sales was – drum roll please – the 3rd largest on record… so maybe, just maybe, the ‘market’ is seeing through that pure riggedness, wondering about the huge surge in continuing claims, and agog at the blowout in credit spreads and collapse in crude…

 

Seriously?!! The 3rd largest November seasonal adjustment on record… why? and remember retail sales only beat by 0.1ppt!

 

Speechless, yet?

Well look at this…

 

Rigged much?

 

Charts: STA Wealth Management and Bloomberg




via Zero Hedge http://ift.tt/1uqjuJR Tyler Durden

Will Bipartisan Opposition Kill the Cromnibus?

Will the cromnibus—the $1.1
trillion spending bill intended to fund the government through next
September and avoid a government shutdown—actually pass?

The general
assumption
yesterday was that the law would make it through the
House today with votes from both sides of the aisle.

But after lawmakers spent the day pouring over the
newly-published text of the proposal, the fate of the massive
spending bill is now in doubt: Some conservatives are upset because
the bill doesn’t block President Obama’s executive action on
immigration, and some liberals don’t like a provision that alters
the way Dodd-Frank regulates derivatives. Opposition from both
parties might end up killing a bill that was supposed to pass with
bipartisan support. 

GOP complaints that the bill doesn’t block Obama’s immigration
action tend to conveniently ignore a rather significant problem:
Congress doesn’t have the power to block Obama’s action through the
appropriations process (the cromnibus is mostly a combined
appropriations bill). As Rep. Hal Rogers, the Republican chair of
the House Appropriations Committee,
explained
last month, “the Appropriations process cannot be
used to ‘de-fund’ the agency” that is tasked with carrying out the
action. The agency can fund its work through user fees without
approval from Congress—and could even do so in the event of a
government shutdown.

(The idea that the immigration action can be stopped by
defunding closely resembles the idea that went around last year
that Congress could stop Obamacare by defunding it. In October of
2013, the government shut down; Obamacare’s exchanges crashed on
opening, but not because Republicans had taken it out through the
budget process.)

The objection to the cromnibus from the left has to do with a
relatively obscure rule in Dodd-Frank regulating derivatives known
as the
swaps push-out
provision. Under the rule, some types of
derivatives would have to be moved to financial entities that
aren’t protected by government backing. The change included in the
cromnibus would allow some of those derivatives to stay in house.
For more details, the Republican Study Committee’s legislative
bulletin is
worth reading
. Rep. Jeb Hensarling (R-Texas) makes the case for
the change here.

The liberal objection to the bill, led by Sen. Elizabeth Warren,
is basically that it defangs the financial regulations in
Dodd-Frank. Complicating liberal opposition, however, is that

the White House came out in favor of the cromnibus today
,
noting that it didn’t like the derivatives provision but was
supportive overall.

What we’re seeing, then, is a test of White House influence over
the Democratic party. The administration wants the cromnibus to
pass; there are a number of Democrats who would be content to let
it die.
According
to Politico, Democratic House Minority
Leader Nancy Pelosi, who has voiced strong objections to the
derivatives rule change, “has privately mused that a three-month
continuing resolution might actually be better for Democrats.”

That would not necessarily mean a shutdown, however. If the
cromnibus spending bill falls apart, House Republicans have some
backup plans, including a three month continuing resolution (CR),
which would punt the funding fight into the next Congress, or
perhaps a one-week extension allowing more time to get a vote
together before the end of the year. (Republicans reportedly
said
this afternoon that the three-month CR is the go-to
alternative.)

At this particular moment, though, it’s all up in the air. The
House is currently in recess, which means a vote on the cromnibus
has been postponed, although GOP leadership still says a
vote
will likely happen sometime today.

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