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Submitted by Guy Manno via CrushTheMarket.com,

US Q3 GDP – A Convenient Smokescreen

Leading Indicator – Investment Swings To Contraction

Click chart for source: bloomberg.com

FED Chart Predicts Recession 71% Of The Time

Click chart for source: zerohedge.com

Consecutive Quarters Of Declining Earnings

Click chart for source: bloomberg.com

No Revenue Growth = Business Cut Spending.

Click chart for source: zerohedge.com

Click chart for source: zerohedge.com

Poor Christmas Sales Foretasted

Click chart for source: zerohedge.com

Bad Debts Spiking In 0% Environment.

Click chart for source: bloomberg.com

Leading Indicator Small Cap Index  – Breaking Down

Small companies are traditionally a leading indicator of strength and weakness within an economy. When an economy is set to expand out of contraction you will notice that smaller companies tend to lead higher in price before large cap and blue chip companies do.

On Friday the Russell 2000 index which is the US small cap index broke a key support level on both a weekly and daily chart.  Even though the S&P 500 is still within record highs, the small cap index has broke away from the larger index as it has ended its long term uptrend as well key support levels.

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Yesterday, Bernie Sanders slammed Eli Lilly stock after the former presidential candidate and Vermont Senator asked “why has the price of Humalog insulin gone up 700% in 20 years? It’s simple. The drug industry’s greed”, sending LLY stock to 7 month lows.

Today Bernie’s vendetta with the pharma industry was in the spotlight again, when moments ago Sanders tweeted that “the business model of the drug industry is fraud. Glaxo put patients at risk to increase their profits”

The business model of the drug industry is fraud. Glaxo put patients at risk to increase their profits. https://t.co/sj5OIUxC8N

— Bernie Sanders (@SenSanders) November 2, 2016

In kneejerk reaction, the ADRs of Glaxo stock immediately slid to session lows as yet another shot across the bow of the pharma industry was launched by the prominent democrat.

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Following last night's massive inventory build report from API (biggest in 8 months), DOE piled on by confirming a 14.42mm barrel build – the biggest in the 34 year history of EIA data. Cushing saw a small build but Gasoline and Distillates saw drawdowns. Crude and RBOB prices are tumbling on the news, not helped by the 3rd weekly rise in US Crude production.

API

• Crude +9.3mm (+1.54mm avg. exp)
• Cushing +1mm (-250k exp)
• Gasoline -3.5mm (-1mm exp)
• Distillates -3.1mm

DOE

• Crude +14.42mm (+2mm exp)
• Cushing  +89k (+235k exp)
• Gasoline -2.2mm (-1mm exp)
• Distillates -1.8mm (-1.9mm exp)

API's biggest build in 8 months was nothing compared to the 14.4mm build from DOE – the biggest build ever. Distillates have now drawn down for 6 straight weeks. As Bloomberg's Margot Habiby reports, most of the increase in crude inventories — 8.11 million barrels out of 14.4 million overall — was in the critical Gulf Coast region, where about half of U.S. refining capacity is located.

US Crude production rose for the 3rd week in a row…

And US Crude imports soared to the highest since 2012…

U.S. avg weekly crude imports rose 28% to ~9m b/d last week, the largest volume since September 2012, according to preliminary EIA data for week ending Oct. 28.

Total U.S. imports of crude 8995k b/d vs 7016k

• PADD1: 1164k vs 884k
• PADD2: 2538k vs 2212k
• PADD3: 3814k vs 2913k, highest since July
• PADD4: 344k vs 312k
• PADD5: 1135k vs 696k

Imports into U.S. by country in b/d:

• Canada imports 3282k vs 2885k
• Saudi Arabia imports 1170k vs 983k
• Venezuela imports 835k vs 466k
• Mexico imports 688k vs 323k
• Colombia imports 602k vs 333k
• Ecuador imports 156k vs 179k
• Nigeria imports 345k vs 71k
• Kuwait imports 85k vs 198k
• Iraq imports 645k vs 505k
• Angola imports 30k vs 163k

WTI Crude had extended losses to a $45 handle overnight after the API build (and RBOB swung widely) and plunged on the print…

And finally, bear in mind that oil prices are entering a seasonally weak period…

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As part of the early Podesta emails releases, much attention focused on Hillary Clinton’s three Goldman Sachs transcripts, which revealed that while Hillary presents one, public, side to the general population, in private, and when compensated generously for her time and her real thoughts, she provides a materially different perspective on topics ranging from bank regulation, to the economy, to foreign diplomacy. Or, as John POdesta himself put it, Hillary’s “double standard.”

Today, thanks to the latest Wikileaks dump of hacked John Podesta emails, we now have access to Hillary’s full speech delieved to Deutsche Bank on October 7, 2014 in New York. 

As a reminder, excerpts from the speech had been revealed previously, most notably in the context of how the Clinton Campaign planned to respond to media inquiries into what Hillary Clinton told the banks privately, with the decision ultimately being made to not reveal anything.

In an email on November 20, 2015 Clinton speechwriter Dan Schwerin explicitly noted how he left an “easter egg” in the DB speech precisely in case the world came knocking and asking for Hillary’s speeches:

Following up on the conversation this morning about needing more arrows in our quiver on Wall Street, I wanted to float one idea. In October 2014, HRC did a paid speech in NYC for Deutsche Bank. I wrote her a long riff about economic fairness and how the financial industry has lost its way, precisely for the purpose of having something we could show people if ever asked what she was saying behind closed doors for two years to all those fat cats. It’s definitely not as tough or pointed as we would write it now, but it’s much more than most people would assume she was saying in paid speeches. (Full transcript is attached and key riff is pasted below.)

 

Perhaps at some point there will be value in sharing this with a reporter and getting a story written. Upside would be that when people say she’s too close to Wall Street and has taken too much money from bankers, we can point to evidence that she wasn’t afraid to speak truth to power. Downside would be that we could then be pushed to release transcripts from all her paid speeches, which would be less helpful (although probably not disastrous). In the end, I’m not sure this is worth doing, but wanted to flag it so you know it’s out there.

Yet, despite Schwerin’s pitch, his idea was ultimately shut down: this is what Mandy Grunwald responde in an email thread to Clinton Campaign staffers:

I worry about going down this road.

 

First, the remarks below make it sound like HRC DOESNT think the game is rigged — only that she recognizes that the public thinks so.  They are angry.  She isn’t.

 

Second, once you start looking at speeches, you run smack into Maggie Haberman’s report for Politico on HRC’s Goldman Sachs speech, in which HRC isn’t quoted directly, but described as saying people shouldn’t be vilifying Wall Street.

 

Maybe you think the Deutsche Bank speech takes the sting out of the Goldman report — but I am concerned that the passage below will exacerbate not improve the situation.

Whil we scour through the speech for notable highlights, here are some of the most prominent excerpts:

[E]ven if it may not be 100 percent true, if the perception is that somehow the game is rigged, that should be a problem for all of us, and we have to be willing to make that absolutely clear.

And here is Hillary urging Wall Street to police itself:

Remember what Teddy Roosevelt did. Yes, he took on what he saw as the excesses in the economy, but he also stood against the excesses in politics. He didn’t want to unleash a lot of nationalist, populistic reaction. He wanted to try to figure out how to get back into that balance that has served America so well over our entire nationhood. Today, there’s more that can and should be done that really has to come from the industry itself, and how we can strengthen our economy, create more jobs at a time where that’s increasingly challenging, to get back to Teddy Roosevelt’s square deal.

Full speech below (link):

via http://ift.tt/2fe9xRz Tyler Durden

As part of the early Podesta emails releases, much attention focused on Hillary Clinton’s three Goldman Sachs transcripts, which revealed that while Hillary presents one, public, side to the general population, in private, and when compensated generously for her time and her real thoughts, she provides a materially different perspective on topics ranging from bank regulation, to the economy, to foreign diplomacy. Or, as John POdesta himself put it, Hillary’s “double standard.”

Today, thanks to the latest Wikileaks dump of hacked John Podesta emails, we now have access to Hillary’s full speech delieved to Deutsche Bank on October 7, 2014 in New York. 

As a reminder, excerpts from the speech had been revealed previously, most notably in the context of how the Clinton Campaign planned to respond to media inquiries into what Hillary Clinton told the banks privately, with the decision ultimately being made to not reveal anything.

In an email on November 20, 2015 Clinton speechwriter Dan Schwerin explicitly noted how he left an “easter egg” in the DB speech precisely in case the world came knocking and asking for Hillary’s speeches:

Following up on the conversation this morning about needing more arrows in our quiver on Wall Street, I wanted to float one idea. In October 2014, HRC did a paid speech in NYC for Deutsche Bank. I wrote her a long riff about economic fairness and how the financial industry has lost its way, precisely for the purpose of having something we could show people if ever asked what she was saying behind closed doors for two years to all those fat cats. It’s definitely not as tough or pointed as we would write it now, but it’s much more than most people would assume she was saying in paid speeches. (Full transcript is attached and key riff is pasted below.)

 

Perhaps at some point there will be value in sharing this with a reporter and getting a story written. Upside would be that when people say she’s too close to Wall Street and has taken too much money from bankers, we can point to evidence that she wasn’t afraid to speak truth to power. Downside would be that we could then be pushed to release transcripts from all her paid speeches, which would be less helpful (although probably not disastrous). In the end, I’m not sure this is worth doing, but wanted to flag it so you know it’s out there.

Yet, despite Schwerin’s pitch, his idea was ultimately shut down: this is what Mandy Grunwald responde in an email thread to Clinton Campaign staffers:

I worry about going down this road.

 

First, the remarks below make it sound like HRC DOESNT think the game is rigged — only that she recognizes that the public thinks so.  They are angry.  She isn’t.

 

Second, once you start looking at speeches, you run smack into Maggie Haberman’s report for Politico on HRC’s Goldman Sachs speech, in which HRC isn’t quoted directly, but described as saying people shouldn’t be vilifying Wall Street.

 

Maybe you think the Deutsche Bank speech takes the sting out of the Goldman report — but I am concerned that the passage below will exacerbate not improve the situation.

Whil we scour through the speech for notable highlights, here are some of the most prominent excerpts:

[E]ven if it may not be 100 percent true, if the perception is that somehow the game is rigged, that should be a problem for all of us, and we have to be willing to make that absolutely clear.

And here is Hillary urging Wall Street to police itself:

Remember what Teddy Roosevelt did. Yes, he took on what he saw as the excesses in the economy, but he also stood against the excesses in politics. He didn’t want to unleash a lot of nationalist, populistic reaction. He wanted to try to figure out how to get back into that balance that has served America so well over our entire nationhood. Today, there’s more that can and should be done that really has to come from the industry itself, and how we can strengthen our economy, create more jobs at a time where that’s increasingly challenging, to get back to Teddy Roosevelt’s square deal.

Full speech below (link):

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Confirming the weakness reported by regional Fed surveys, New York Purchasing Managers current business conditions contracted for the 3rd month in a row (at 49.2). This is the 5th contractionary print of the last six months and the weakest streak since 2009.

The outlook declined to 5-month lows as purchases, prices paid, and revenues all declined.

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On Monday we were the first to note that Podesta’s friend Peter Kadzik was the DOJ representative chosen to head up a “thorough” review of the new Huma Abedin emails as revealed by a letter he wrote to Congress.  Given Kadzik’s personal relationship with Podesta, it seemed like a “convenient” choice for the Clinton campaign. 

In the letter to Congress, the DOJ writes that it “will continue to work closely with the FBI and together, dedicate all necessary resources and take appropriate steps as expeditiously as possible,” assistant attorney General Peter J. Kadzik writes in letters to House and Senate lawmakers.

“Ironically”, that is the same Peter Kadzik who has proven his “impartiality” in multiple WikiLeaks emails including this newly released bombshell in which Kadzik provides a very helpful “heads up” about Hillary’s email server investigation.

Sure, who needs an independent investigator…this guy will do just fine.

* * *

And for readers who missed our original report on the long-running relationship between John Podesta and his close friend Peter Kadzik, here is an excerpt from our most recent article on the topic:

In the letter to Congress, the DOJ writes that it “will continue to work closely with the FBI and together, dedicate all necessary resources and take appropriate steps as expeditiously as possible,” assistant attorney General Peter J. Kadzik writes in letters to House and Senate lawmakers.

#BREAKING Senior DOJ official sends letter to lawmakers responding to request for more information about email review.#8days http://pic.twitter.com/PCgT2ODkQd

— Just the Facts (@JTF_News) October 31, 2016

So far so good, even if one wonders just how active the DOJ will be in a case that has shown an unprecedented schism between the politically influenced Department of Justice and the FBI.

And yet, something felt odd about this.

Kadzik… Kadzik… where have we heard that name?

Oh yes. Recall our post from last week, “Clinton Campaign Chair Had Dinner With Top DOJ Official One Day After Hillary’s Benghazi Hearing” in which we reported that John Podesta had dinner with one of the highest ranked DOJ officials the very day after Hillary Clinton’s Benghazi testimony?

It was Peter Kadzik.

In other words, the best friend of John Podesta, Clinton’s Campaign chair, at the DOJ will be in charge of a probe that could potentially sink Hillary Clinton.

For those who missed it, this is what we reported previously:

The day after Hillary Clinton testified in front of the House Select Committee on Benghazi last October, John Podesta, Hillary’s campaign chairman met for dinner with a small group of well-connected friends, including Peter Kadzik, who is currently a top official at the US Justice Department serving as Assistant Attorney General for Legislative Affairs.

 

The post-Benghazi dinner was attended by Podesta, Kadzik, superlobbyist Vincent Roberti and other well-placed Beltway fixtures. The first mention of personal contact between Podesta and Kadzik in the Wikileaks dump is in an Oct. 23, 2015 email sent out by Vincent Roberti, a lobbyist who is close to Podesta and his superlobbyist brother, Tony Podesta. In it, Roberti refers to a dinner reservation at Posto, a Washington D.C. restaurant.  The dinner was set for 7:30 that evening, just one day after Clinton gave 11 hours of testimony to the Benghazi Committee.

 

Podesta and Kadzik met several months later for dinner at Podesta’s home, another email shows. Another email sent on May 5, 2015, Kadzik’s son asked Podesta for a job on the Clinton campaign.

As the Daily Caller noted, the dinner arrangement “is just the latest example of an apparent conflict of interest between the Clinton campaign and the federal agency charged with investigating the former secretary of state’s email practices.” As one former U.S. Attorney tells told the DC, the exchanges are another example of the Clinton campaign’s “cozy relationship” with the Obama Justice Department.

The hacked emails confirm that Podesta and Kadzik were in frequent contact. In one email from January, Kadzik and Podesta, who were classmates at Georgetown Law School in the 1970s, discussed plans to celebrate Podesta’s birthday. And in another sent last May, Kadzik’s son emailed Podesta asking for a job on the Clinton campaign.

“The political appointees in the Obama administration, especially in the Department of Justice, appear to be very partisan in nature and I don’t think had clean hands when it comes to the investigation of the private email server,” says Matthew Whitaker, the executive director of the Foundation for Accountability and Civic Trust, a government watchdog group.

“It’s the kind of thing the American people are frustrated about is that the politically powerful have insider access and have these kind of relationships that ultimately appear to always break to the benefit of Hillary Clinton,” he added, comparing the Podesta-Kadzik meetings to the revelation that Attorney General Loretta Lynch met in private with Bill Clinton at the airport in Phoenix days before the FBI and DOJ investigating Hillary Clinton.

Kadzik’s role at the DOJ, where he started in 2013, is particularly notable Kadzik, as helped spearhead the effort to nominate Lynch, who was heavily criticized for her secret meeting with the former president.

It gets better because, as we further revealed, if there is one person in the DOJ who is John Podesta’s, and thus the Clinton Foundation’s inside man, it is Peter Kadjik.

Kadzik represented Podesta during the Monica Lewinsky investigation. And in the waning days of the Bill Clinton administration, Kadzik lobbied Podesta on behalf of Marc Rich, the fugitive who Bill Clinton controversially pardoned on his last day in office. That history is cited by Podesta in another email hacked from his Gmail account. In a Sept. 2008 email, which the Washington Free Beacon flagged last week, Podesta emailed an Obama campaign official to recommend Kadzik for a supportive role in the campaign. Podesta, who would later head up the Obama White House transition effort, wrote that Kadzik was a “fantastic lawyer” who “kept me out of jail.”

Podesta was caught in a sticky situation in both the Lewinsky affair and the Rich pardon scandal. As deputy chief of staff to Clinton in 1996, Podesta asked then-United Nations ambassador Bill Richardson to hire the 23-year-old Lewinsky. In April 1996, the White House transferred Lewinsky from her job as a White House intern to the Pentagon in order to keep her and Bill Clinton separate. But the Clinton team also wanted to keep Lewinsky happy so that she would not spill the beans about her sexual relationship with Clinton.

Richardson later recounted in his autobiography that he offered Lewinsky the position but that she declined it.

Podesta made false statements to a grand jury impaneled by Independent Counsel Kenneth Starr for the investigation. But he defended the falsehoods, saying later that he was merely relaying false information from Clinton that he did not know was inaccurate at the time. “He did lie to me,” Podesta said about Clinton in a National Public Radio interview in 1998. Clinton was acquitted by the Senate in Feb. 1999 of perjury and obstruction of justice charges related to the Lewinsky probe. Kadzik, then a lawyer with the firm Dickstein Shapiro Morin & Oshinsky, represented Podesta through the fiasco.

Podesta had been promoted to Clinton’s chief of staff when he and Kadzik became embroiled in another scandal.

Kadzik was then representing Marc Rich, a billionaire financier who was wanted by the U.S. government for evading a $48 million tax bill. The fugitive, who was also implicated in illegal trading activity with nations that sponsored terrorism, had been living in Switzerland for 17 years when he sought the pardon. To help Rich, Kadzik lobbied Podesta heavily in the weeks before Clinton left office on Jan. 20, 2001. A House Oversight Committee report released in May 2002 stated that “Kadzik was recruited into Marc Rich’s lobbying campaign because he was a long-time friend of White House Chief of Staff John Podesta.”

The report noted that Kadzik contacted Podesta at least seven times regarding Rich’s pardon. On top of the all-hands-on-deck lobbying effort, Rich’s ex-wife, Denise Rich, had doled out more than $1 million to the Clintons and other Democrats prior to the pardon. She gave $100,000 to Hillary Clinton’s New York Senate campaign and another $450,000 to the Clinton presidential library.

Kadzik’s current role

In his current role as head of the Office of Legislative Affairs, Kadzik handles inquiries from Congress on a variety of issues. In that role he was not in the direct chain of command on the Clinton investigation. The Justice Department and FBI have insisted that career investigators oversaw the investigation, which concluded in July with no charges filed against Clinton.

But Kadzik worked on other Clinton email issues in his dealings with Congress. Last November, he denied a request from Republican lawmakers to appoint a special counsel to lead the investigation.

In a Feb. 1, 2016 letter in response to Kadzik, Florida Rep. Ron DeSantis noted that Kadzik had explained “that special counsel may be appointed at the discretion of the Attorney General when an investigation or prosecution by the Department of Justice would create a potential conflict of interest.”

DeSantis, a Republican, suggested that Lynch’s appointment by Bill Clinton in 1999 as U.S. Attorney in New York may be considered a conflict of interest. He also asserted that Obama’s political appointees — a list which includes Kadzik — “are being asked to impartially execute their respective duties as Department of Justice officials that may involve an investigation into the activities of the forerunner for the Democratic nomination for President of the United States.”

It is unknown if Kadzik responded to DeSantis’ questions.

Kadzik’s first involvement in the Clinton email brouhaha came in a Sept. 24, 2015 response letter to Senate Judiciary Committee chairman Chuck Grassley in which he declined to confirm or deny whether the DOJ was investigating Clinton. Last month, Politico reported that Kadzik angered Republican lawmakers when, in a classified briefing, he declined to say whether Clinton aides who received DOJ immunity were required to cooperate with congressional probes.

Kadzik also testified at a House Oversight Committee hearing last month on the issue of classifications and redactions in the FBI’s files of the Clinton email investigation.

Finally, it is also worth noting that Kadzik’s wife, Amy Weiss, currently at Weiss Public Affairs worked on the 1992 Clinton/Gore Campaign as a Press Secretary, and Communications Director for the Democratic National Committee, and a White House Deputy Assistant to the President/Deputy Press Secretary to President Bill Clinton.

* * *

And now it seems that Kadzik will be in charge of the DOJ’s “probe” into Huma Abedin’s emails. Which is why we are a little skeptical the DOJ will find “anything” of note.

Amy Weiss, Peter Kadzik, with lobbyist Tony Podesta, brother of John Podesta.

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