Category: zerohedge

In his recent TV appearance, last week David Stockman suggested that President Trump would be better suited to some time actually addressing economic issues instead of the administration’s travel ban for immigrants from Middle Eastern countries, which Stockman called “a giant misfire.” Employing the 1992 Clinton Campaign motto of “it’s the economy, stupid,” Stockman noted “Trump was elected because flyover America is hurting economically. The voters of Racine, Wisconsin and Johnstown, Pennsylvania are imperiled not because of some refugees, they’re imperiled because their jobs have all been disappearing for decades.” He added, correctly, that “the problem is far more the Federal Reserve, Janet Yellen, the bubbles they’re creating on Wall Street.”

Stockman went on to suggest that the Trump Administration is showing decreased interest in “draining the swamp”, having surrounded himself with, as he himself has now realized, the “Goldman Guys.”

Then, in a follow up interview with CNBC, Stockman once again discussed the impact of Trump, this time on markets, and warned that while stocks are booming under Trump, with the S&P now up 12%  since the election (with banks up 25% and Goldman 35% higher), traders are living in a “fantasy land” that can’t last —and Trump’s policies will derail the market for years to come.

Stockman reiterated his concern that Trump has lost his focus on the economy, and has become distracted by other issues which should be a particular point of worry for investors.

Most of Trump’s actions “[have] nothing to do with the economic agenda” he’s proposed, Stockman told CNBC. That, along with a debt ceiling debate that will take place on March 15 in Congress, and a market rally that has gone on for a while, has the bearish Stockman worrying about a big downturn, which however not only refuses not to come, but the S&P hasn’t had a 1% drop in 85 days.

“What’s going on today is complete insanity,” said Stockman. “The market is apparently pricing in a huge Trump stimulus. But if you just look at the real world out there, the only thing that’s going to happen is a fiscal bloodbath and a White House train wreck like never before in U.S. history.”

He added that “there’s going to be no tax action this year,” said Stockman, echoing repeated concerns by Goldman who have said, mostly recently this morning, that Trump’s plans for the economy are facing mounting political risks. Last week, the president vowed that tax reform could happen this year, and promised to unveil a “phenomenal” tax plan within the next few weeks, which however has drawn skepticism from Washington insiders.

“If there’s any next year it will be deficit neutral, which means it’s not going to add the $15 to earnings like these people expect,” Stockman said. In fact, as reported earlier, with the Border Adjustment Tax becoming a virtual impossibility, the extent of corporate tax cuts will likely be far less than what the market is pricing in currently. 

“My argument is there is not going to be any economic rebound, there is not going to be any profit surge,” Stockman added. “Therefore the market will be repricing dramatically downward once it’s clear that that’s the case.”

For now, the market blissfully refuses to listen. In a prior appearance on CNBC in November, Stockman argued that a recession was coming in 2017 thanks to Trump. For now it is Stockman’s word of caution against that of Gartman, who earlier today predicted that because “Illogic reigns” the market “melt Up” has begun in earnest and it will stop when it stops and not a moment before.”

Needless to say, everyone would like to know when that “moment” is.

via http://ift.tt/2l1QSLe Tyler Durden

Submitted by Mac Slavo via SHTFPlan.com,

The rage among the left continues to build and it is being supported in earnest by mainstream personalities in Hollywood and the music industry. As Martin Armstrong points out, the constant protests by the Entertainment industry against Trump will not subside.

The Grammy show was reduced to hurried political statements, A Tribe Called Quest delivered a vigorous rebuke of Trump during a tribute to Phife Dawg, who died in March 2016. The group said the performance of We the People was also in honor of protesters.

 

The hip-hop group was joined by Rhymes who thanked “President Agent Orange”  the new name they gave to Trump for “perpetuating evil in the United States”. The tribute ended with people of different races gathered on stage as Q-Tip repeatedly shouted: “Resist” as the camera faded to commercial.

According to cyclical analyst Martin Armstrong, things are only going to get worse as protests spread and soon turn to large-scale riots.

 

Via Armstrong Economics:

All of this is building to violence. Then the police will respond and then the outcries will be see – Trump is running a police state. This will only tear the country apart. Many of these protesters are not old enough to even vote. Their teachers allow them to cut class to protest against Trump.

 

When asked what they are protesting about, they do not even understand the issues.

 

 

This is like a rumor mill. By the time it gets to the 5th person, it is nothing like what was said. You have black students in high school repeating Trump said all blacks are ignorant. Others saying Iraq is not a terrorist nation because they never heard of that. Still others said people should come in and not even be checked. This is the mindset that is sweeping the nation and it is really scary. This is part of the cycle of civil unrest and indeed it looks like the computer is going to be right once again.

 

This will be the BIGGEST spike in civil unrest in American history, It is already the biggest with regard to trying to block and overthrow the Trump Administration and Obama, Nancy Pelosi, and Chuck Schummer are all encouraging this violence.  Nancy Pelosi says she cannot work with Trump at all and she is the head of the Democrats.

 

This will ONLY end in bloodshed.

Armstrong’s economic confidence model has been highly accurate for over thirty years, having predicted, among other things, the Savings and Loan crash of the late 1980’s to the very day, the collapse of Japanese stocks, and the destruction of the Russian economy. Several years ago Armstrong’s political forecasts specifically noted that periods of civil unrest were coming. As Armstrong concludes rather ominously – and looking increasingly likely to be correct…

There is only one way this is going to end and that is blood in the streets. The riots will only escalate and the left ALWAYS becomes violent.

via http://ift.tt/2kkSLG8 Tyler Durden

Back in 2009, the Obama administration drew a lot of fire from employers and labor unions over Obamacare’s so-called “Cadillac Tax”, a tax on healthcare premiums over a certain threshold.  Apparently, the United Auto Workers in the Midwest had grown accustomed to their unlimited supply of Viagra, completely free of charge, and were unwilling to ‘go down’ without a fight.

Fast forward eight years and now several Republican plans for replacing the ACA include their own curb on generous health plans: a cap on how much of employer-provided health benefits could be shielded from taxes. Such a cap could force certain workers to start paying income tax on a portion of the cost of their coverage.

Currently, when an employee receives health insurance, the value of that benefit isn’t subject to either income or payroll taxes. On average, employer coverage for a single worker last year ran $6,435, while for a family, the tab was $18,142, according to a survey by the Kaiser Family Foundation. Employers bore about 82% of the cost for single plans, and about 70% for family coverage.

While the Republican plan would limit the deductibility of premium payments as opposed to implementing a special tax, as the Wall Street Journal points out, “in the end, they both would have similar effects,” including pushing companies toward skinnier health plans, according to Steve Wojcik, an official with the National Business Group on Health, which represents employers. “It’s six of one, a half-dozen of the other.”

 

Of course, many politicians in Washington D.C. view a tax on “Cadillac” plans as a huge revenue opportunity that could add $20 billion annually to federal coffers by 2025.

House Speaker Paul Ryan (R., Wis.) said recently he has long supported a cap on the health-benefits tax exclusion, but that it was an “open question” where Congress would end up on the issue. Mr. Hatch in a statement said, “We must study the open-ended tax preference and its impact on costs for employees and increased spending by employers.”

 

The tax exclusion for employer health benefits represents a huge pool of potential federal revenue, estimated at $266 billion in 2016, according to the Congressional Budget Office. Capping the exclusion would bring in a small fraction of that total. The Cadillac tax, the CBO said, would raise federal revenue by $2 billion in 2020, growing to $20 billion in 2025—money that could help defray the cost of expanded health coverage under the ACA.

That said, it’s not just C-suite executives who would be hit by the “Cadillac tax” as many unionized employees are also at risk, after decades of negotiating ever better healthcare plans far in excess of what their counterparts in non-unionized, private-sector jobs get.

Still, the current proposals to limit the tax exclusion are drawing sharp pushback from employers, which say the change could limit their flexibility and add to their costs, and labor groups, which fear their members could end up paying additional taxes. A December letter to members of Congress that criticized both the Cadillac tax and the health-benefits exclusion cap was signed by groups including the U.S. Chamber of Commerce and the National Retail Federation.

 

The cap is also drawing opposition from the Alliance to Fight the 40, a coalition that lobbies against the Cadillac tax, which would impose a 40% levy on the value of health plans above certain cutoff levels. Last month, the group, which includes employers, unions and health companies, paid to blast an ad at electronic devices in the vicinity of congressional Republicans’ Philadelphia retreat, with the message: “Taxes on employer-sponsored health care are a bad idea.”

 

Members of unions that have negotiated robust health benefits are among those likely to be hit by taxes tied to high-cost plans. Capping the health-benefits exclusion “would be a huge tax increase on the middle class,” said D. Taylor, president of Unite Here, which represents hospitality workers.

Meanwhile, economists have long said the tax exclusion for health benefits has negative effects, encouraging employers to offer too-generous health coverage. That, they argue, leads to excessive health spending because employees are shielded from the full cost of medical care.  The existing health-benefits tax exclusion “has been an important factor in promoting the kinds of inefficiencies in the health-care system that we have seen,” said Joseph Antos, an expert at the conservative-leaning American Enterprise Institute, who supports a cap on the employer health-benefits tax exclusion.

Of course, the real question is how Trump’s largely unionized supporters in Michigan, Wisconsin and Pennsylvania will respond to an assault on their unlimited chiropractic visits, ‘therapeutic’ massages and Viagra.

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

Back in 2009, the Obama administration drew a lot of fire from employers and labor unions over Obamacare’s so-called “Cadillac Tax”, a tax on healthcare premiums over a certain threshold.  Apparently, the United Auto Workers in the Midwest had grown accustomed to their unlimited supply of Viagra, completely free of charge, and were unwilling to ‘go down’ without a fight.

Fast forward eight years and now several Republican plans for replacing the ACA include their own curb on generous health plans: a cap on how much of employer-provided health benefits could be shielded from taxes. Such a cap could force certain workers to start paying income tax on a portion of the cost of their coverage.

Currently, when an employee receives health insurance, the value of that benefit isn’t subject to either income or payroll taxes. On average, employer coverage for a single worker last year ran $6,435, while for a family, the tab was $18,142, according to a survey by the Kaiser Family Foundation. Employers bore about 82% of the cost for single plans, and about 70% for family coverage.

While the Republican plan would limit the deductibility of premium payments as opposed to implementing a special tax, as the Wall Street Journal points out, “in the end, they both would have similar effects,” including pushing companies toward skinnier health plans, according to Steve Wojcik, an official with the National Business Group on Health, which represents employers. “It’s six of one, a half-dozen of the other.”

 

Of course, many politicians in Washington D.C. view a tax on “Cadillac” plans as a huge revenue opportunity that could add $20 billion annually to federal coffers by 2025.

House Speaker Paul Ryan (R., Wis.) said recently he has long supported a cap on the health-benefits tax exclusion, but that it was an “open question” where Congress would end up on the issue. Mr. Hatch in a statement said, “We must study the open-ended tax preference and its impact on costs for employees and increased spending by employers.”

 

The tax exclusion for employer health benefits represents a huge pool of potential federal revenue, estimated at $266 billion in 2016, according to the Congressional Budget Office. Capping the exclusion would bring in a small fraction of that total. The Cadillac tax, the CBO said, would raise federal revenue by $2 billion in 2020, growing to $20 billion in 2025—money that could help defray the cost of expanded health coverage under the ACA.

That said, it’s not just C-suite executives who would be hit by the “Cadillac tax” as many unionized employees are also at risk, after decades of negotiating ever better healthcare plans far in excess of what their counterparts in non-unionized, private-sector jobs get.

Still, the current proposals to limit the tax exclusion are drawing sharp pushback from employers, which say the change could limit their flexibility and add to their costs, and labor groups, which fear their members could end up paying additional taxes. A December letter to members of Congress that criticized both the Cadillac tax and the health-benefits exclusion cap was signed by groups including the U.S. Chamber of Commerce and the National Retail Federation.

 

The cap is also drawing opposition from the Alliance to Fight the 40, a coalition that lobbies against the Cadillac tax, which would impose a 40% levy on the value of health plans above certain cutoff levels. Last month, the group, which includes employers, unions and health companies, paid to blast an ad at electronic devices in the vicinity of congressional Republicans’ Philadelphia retreat, with the message: “Taxes on employer-sponsored health care are a bad idea.”

 

Members of unions that have negotiated robust health benefits are among those likely to be hit by taxes tied to high-cost plans. Capping the health-benefits exclusion “would be a huge tax increase on the middle class,” said D. Taylor, president of Unite Here, which represents hospitality workers.

Meanwhile, economists have long said the tax exclusion for health benefits has negative effects, encouraging employers to offer too-generous health coverage. That, they argue, leads to excessive health spending because employees are shielded from the full cost of medical care.  The existing health-benefits tax exclusion “has been an important factor in promoting the kinds of inefficiencies in the health-care system that we have seen,” said Joseph Antos, an expert at the conservative-leaning American Enterprise Institute, who supports a cap on the employer health-benefits tax exclusion.

Of course, the real question is how Trump’s largely unionized supporters in Michigan, Wisconsin and Pennsylvania will respond to an assault on their unlimited chiropractic visits, ‘therapeutic’ massages and Viagra.

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

Submitted by Lance Roberts via RealInvestmentAdvice.com,

One of my favorite investing legends is Oaktree Management’s, Howard Marks. His investing wisdom have been a major source of education over the years and his deep knowledge and understanding of investor psychology and market dynamics is truly unparalleled.

This past weekend, I was digging through some old research and ran across an interview between Goldman Sach’s Hugo-Scott Gall and Howard Marks on everything from investment decisions to behavioral dynamics.

This interview was originally done back in 2013, and interestingly enough it is just as relevant today as it was then. I hope you find this as informative and educational as I did.

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Hugo Scott-Gall: How can we understand investor psychology and use it to make investment decisions?

Howard Marks: It’s the swings of psychology that get people into the biggest trouble, especially since investors’ emotions invariably swing in the wrong direction at the wrong time. When things are going well people become greedy and enthusiastic, and when times are troubled, people become fearful and reticent. That’s just the wrong thing to do. It’s important to control fear and greed.

Another mistake that people often make is that they compare themselves with others who are making more money than they are and conclude that they should emulate the others’ actions … after they’ve worked. This is the source of the herd behavior that so often gets them into trouble. We’re all human and so we’re subject to these influences, but we mustn’t succumb. This is why the best investors are quite cold-blooded in their professional activities.

We can infer psychology from investor behavior, and that allows us to get an understanding of how risky the market is, even though the direction in which it will head can never be known for certain. By understanding what’s going on, we can infer the “temperature” of the market. In my book, I give a list of characteristics that can give you an idea whether the market is hot or cold, and by using them we can control our buying patterns. They include capital availability, the eagerness of lenders and investors, the ease of entry for new funds, and the width of credit spreads, among others.

We need to remember to buy more when attitudes toward the market are cool and less when they’re heated. For example, the ability to do inherently unsafe deals in quantity suggests a dearth of skepticism on the part of investors. Likewise, when every new fund is oversubscribed, you know there’s eagerness. Too little skepticism and too much eagerness in an up-market – just like too much resistance and pessimism in a down-market – can be very bad for investment results.

Warren Buffett once said,

“The less prudence with which others conduct their affairs, the greater the prudence with which we must conduct our own affairs.”

I agree thoroughly, and in order to understand how much prudence others are applying, we need to observe investor behavior and the kinds of deals that are getting done. In 2006 and 2007, just before the onset of the financial crisis, many deals got done that left me scratching my head. That indicated low levels of risk aversion and prudence. We can’t measure prudence through a quantitative process, and so we have to infer it by observing the behavior of market participants.

The fundamental building block of investment theory is the assumption that investors are risk averse. But, in reality, they are sometimes very risk averse and miss a lot of buying opportunities, and sometimes very risk tolerant and buy when they shouldn’t. Risk aversion isn’t constant or dependable. That’s what Buffett means when he says that when other people apply less, you should apply more.

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Hugo Scott-Gall: Why do behavior patterns and mistakes recur despite the plethora of information available now? Are we doomed to repeat our mistakes?

Howard Marks: Information and knowledge are two different things. We can have a lot of information without much knowledge, and we can have a lot of knowledge without much wisdom. In fact, sometimes too much data keeps us from seeing the big picture; we can “miss the forest for the trees.”

It’s extremely important to know history, but the trouble is that the big events in financial history occur only once every few generations. The latest global financial crisis began in 2008 and the one before that in 1929. That’s a gap of 79 years. So, while memory has the potential to restrain action and induce prudence by reminding us of tough periods, over time as memory fades the lessons fade as well.

In the investment environment, memory and the resultant prudence regularly do battle with greed, and greed tends to win out. Prudence is particularly dismissed when risky investments have paid off for a span of years. John Kenneth Galbraith wrote that the outstanding characteristics of financial markets are shortness of memory and ignorance of history.

In hot times, the few who do remember the past are dismissed as relics of the old, lacking the ability to imagine the new. But it invariably turns out that there’s nothing new in terms of investor behavior. Mark Twain said that “history does not repeat itself but it does rhyme,” and what rhymes are the important themes.

The bottom line is that even though knowing financial history is important, requiring people to study it won’t make a big difference, because they’ll ignore its lessons. There’s a very strong tendency for people to believe in things which, if true, would make them rich. Demosthenes said,

“For that a man wishes, he generally believes to be true”

Just like in the movies, where they show a person in a dilemma to have an angel on one side and a devil on the other, in the case of investing, investors have prudence and memory on one shoulder and greed on the other. Most of the time greed wins. As long as human nature is part of the investment environment, which it always will be, we’ll experience bubbles and crashes.

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Hugo Scott-Gall: What things in your skill set have served you well?

Howard Marks: While knowing financial analysis and accounting is essential, almost any smart person can acquire those skills and get a rough idea of the merits of a company. Superior investors are those who understand both fundamentals and markets and have a better sense for what a given set of merits is worth today and what it will be worth in the future. I don’t think I became less able to do financial analysis over time, but I engaged much more in understanding and sensing markets and values: the “big picture”. A lot of my contribution comes from understanding history and investor behavior, from inferring what’s going on around me, and from controlling my emotions.

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Hugo Scott-Gall: Success in our industry often leads to overconfidence. How do good investors avoid that?

Howard Marks: Mark Twain once said,

“It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”

And I totally agree with that. One of the chapters in my book is about the importance of knowing what you don’t know. People who are smart often overestimate what they know, and this tendency can grow, particularly if they are financially successful. And eventually, you get to the master of the universe problem that Tom Wolfe identified in “The Bonfires of the Vanities.”

I believe there’s a lot we don’t know, and it’s important to acknowledge that. I’m sure I know almost nothing about what the future holds, but a lot of people claim to know exactly what’s going to happen. I consider it very dangerous to listen to them. As John Kenneth Galbraith said,

“There are two kinds of forecasters. Those who don’t know, and those who don’t know they don’t know.”

I’m proud to say I’m a member of the first group. Amos Tversky, who was a great behaviorist at Stanford University, said that,

“It’s frightening to think that you might not know something, but more frightening to think that, by and large, the world is run by people who have faith that they know exactly what’s going on”.

That is particularly true for investing. I’d much rather have my money run by somebody who acknowledges what he doesn’t know than somebody who’s overconfident. As Henry Kaufman, the noted economist pointed out,

“We have two kinds of people who lose a lot of money; those who know nothing and those who know everything.”

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Hugo Scott-Gall: Have you always been this way, or did you learn to be self-aware and emotionally disciplined?

Howard Marks: I’m inherently unemotional, and I’ve also observed for 45 years that emotions swing in the wrong direction and learned that it’s extremely important to control it. In the market swoon of 1998, I had an employee tell me he was afraid the financial system was going to melt down. I heard him out and then told him to carry on with his work. I don’t compare myself or my colleagues to them, but battlefield heroes aren’t people who are unafraid; they’re people who are afraid and do it anyway. And so we must keep investing; in fact, we should invest even more when it is scary, because that’s when prices are low.

Walter Cronkite once said:

“If you’re not confused you don’t understand what’s going on”.

In the fourth quarter of 2008, I paraphrased that to say, “If you’re not afraid you don’t understand what’s going on.” Those were scary times. But even if you’re afraid, you have to push on. In the depths of the crisis in October ’08 I wrote a memo that I’m particularly proud of, called ‘The Limits to Negativism.’ It touched on the importance of skepticism in an investor. In good times skepticism means recognizing the things that are too good to be true; that’s something everyone knows. But in bad times, it requires sensing when things are too bad to be true. People have a hard time doing that.

The things that terrify other people will probably terrify you too, but to be successful an investor has to be stalwart. After all, most of the time the world doesn’t end, and if you invest when everyone else thinks it will, you’re apt to get some bargains.

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Hugo Scott-Gall: Do you calculate estimates of fair value in advance for the things you want to buy, and do you wait to buy until those are reached in a market downdraft?

Howard Marks: We can try to do analysis in advance, but opportunities often arise unexpectedly. For example, if everyone gets scared due to some sudden bad news about a company, that can give us an opportunity to respond spontaneously and buy its debt cheap. So we can’t plan everything and follow a neat pattern, as a lot of what we do is very opportunistic. We can have estimates of value for some companies, but we can’t know which companies will show up on the troubled list on a given day, or what bonds are going to come up for sale. Most of the inquiries are incoming to us rather than outgoing, meaning we try to buy the things that they want to sell. We have to be generally ready but also be responsive to opportunities to be self-aware and emotionally disciplined?

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Hugo Scott-Gall: How do you think about the current very low interest rate regime?

Howard Marks: Yes. The point is that today you can’t make a decent return safely. Six or seven years back, you could buy three to five-year Treasurys and get a return of 6% or so. So you could have both safety and income. But today, investors have to make a difficult choice: safety or income. If investors want complete safety, they can’t get much income, and if they aim for high income, they can’t completely avoid risk. It’s much more challenging today with rates being suppressed by governments.

This is one of the negative consequences of centrally administered economic decisions. People talk about the wisdom of the free market – of the invisible hand – but there’s no free market in money today. Interest rates are not natural. They are where they are because the governments have set them at that level. Free markets optimize the allocation of resources in the long run, and administered markets distort the allocation of resources. This is not a good thing… although it was absolutely necessary four years ago in order to avoid a complete crash and restart the capital markets.

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Hugo Scott-Gall: If it’s human nature that causes the bubbles and crashes, do you think asset management should be done with more machines and fewer people?

Howard Marks: No, I disagree strenuously. People who doubt the existence of inefficient markets and the ability to profit from them may disagree with me. But if you think you’re operating in an inefficient market like I try to do, a lot can be accomplished by getting great people, developing an effective investment approach, hunting for misvaluations, keeping psychology under control, and understanding where you are in the cycle. I am not saying that everyone should try this. In fact, an algorithm or an index fund may work best for a lot of people. But at Oaktree, we don’t make heavy use of machines. We are fundamentalists and ours is a “non-quant shop.” As long as there are people on the other side making mistakes – failing to fully understand assets, acting emotionally, selling too low and buying too high – we’ll continue to find opportunities to produce superior risk-adjusted returns. This is something I’m very sure of.

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Hugo Scott-Gall: Where would you want to be if you were starting your career as a contrarian today?

Howard Marks: A market being interesting in the long term and being cheap at the moment are two different things. Credit and debt investing is still very, very attractive and interesting to spend time in, even though it may not be especially rife with great bargains today

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The more things change, the more they remain the same.

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

As discussed previously, the biggest priority for California officials tasked with restoring the damaged Oroville Dam as they race against a coming Wednesday storm, is to plug the hole in the damaged spillway while draining as much water as possible ahead of the coming rainfall.

The good news, as the chart below shows, is how the water level at the Oroville reservoir has been declining over the last 24 hours. According to a spokesman for the Department of Water Resources water is pouring down the facility’s damaged main spillway at a rate of about 100,000 cubic feet per second, or nearly twice the rate as water flowing into it. By 10 a.m., the lake’s water level was 4 feet lower than the emergency spillway, which suffered damage during its first ever water release over the weekend. Officials added that the water level of Lake Oroville has been steadily dropping at a rate of roughly 3 to 4 inches per hour.

9am- Lake Oroville down ~5.5feet since its peak early Sunday @CA_DWR http://pic.twitter.com/PIIO2G2SHk

— Eileen Javora (@kcrajavora) February 13, 2017

A subsequent tweet by the California Office of Emergency Services updated that as of 12:30pm Pacific, the lake level had declined to 6 feet below the damaged emergency spillway.

Video from 12:30 today. Water released over Lake Oroville spillway at 100K cfs. Lake level 6′ below Emerg. spillway. http://pic.twitter.com/DKbe1mwgZi

— Cal OES (@Cal_OES) February 13, 2017

Workers with the CA Department of Water Resources are scrambling to reduce the lake’s overall water level to 50 feet below the emergency spillway elevation of 901 feet. That mission has taken on added urgency ahead of the previously reported heavy rains expected later in the week. According to a subsequent tweet by the California DWR, the dam is now releasing over 110,000 cubic feet per second from the main Oroville Spillway, with the lake level dropping around 8′ per day.

The current flows from the dam can be seen in the tweet below:

Current flows at the #OrovilleSpillway #OrovilleDam http://pic.twitter.com/Ee3e8faUJZ

— Cal OES (@Cal_OES) February 13, 2017

Earlier in the day, California authorities released various photos showing the situation at the Oroville Dam as of noon Pacific time. As noted, water levels at the reservoir have receded, and the damaged emergency spillway is no longer receiving water. But the damaged main spillway is still going strong, as the photos below show. The photos also show the erosion along the emergency spillway.

Current images of the #OrovilleDam from @CHP_Valley Air Operations’ H24, which is providing law enforcement support. @Cal_OES @CaltransHQ http://pic.twitter.com/D0Cg66DM5Q

— Commissioner Farrow (@CHPCommissioner) February 13, 2017

A view from Chopper 5 over the #OrovilleDam Monday morning. Latest: https://t.co/5k0hUgTvpD http://pic.twitter.com/tHskw5na8X

— KCBS 106.9 FM/740 AM (@KCBSNews) February 13, 2017

Oroville Dam current outflow 100K cfs, water level dropping +4ft since releases increased yesterday. Update planned for 12pm @kcranews http://pic.twitter.com/UrnPztccqK

— Vicki Gonzalez (@KCRAVicki) February 13, 2017

While the lack of deterioration is good news, the LA Times has released the following map showing the areas which are still at risk of flooding near Lake Oroville.

And in addition to the threat of the upcoming rains, a residual risk with the emergency spillway is that the erosion from the overflowing water may erode the earth by the dam, destabilizing the structure. According to AP, the erosion at the head of the emergency spillway threatens to undermine the concrete wall and allow large, uncontrolled releases of water from Lake Oroville. Those flows could overwhelm the Feather River and other downstream waterways and levees and flood towns in three counties.

Department engineer and spokesman Kevin Dossey told the Sacramento Bee the emergency spillway was rated to handle 250,000 cubic feet per second, but it began to show weakness Sunday after flows peaked at 12,600 cubic feet per second.

The aerial photo above of the emergency spillway at Lake Oroville shows signs of major damage.

Meanwhile, perhaps because the worst possible outcome has failed to materialize, local officials have been forced to defend the order to evacuate nearly 200,000 people in the affected areas. The Butte County Sheriff Kory Honea on Monday defended his decision a day earlier calling for evacuations of more than 100,000 residents down river from the Oroville Dam after concerns that a spillway could fail and unleash a 30-foot tall wall of water on the region.

“I recognize and absolutely appreciate the frustration people who were evacuated must feel,” Honea said at a press conference. “It wasn’t a decision I made lightly.”

The calls for cities and towns downriver from Lake Oroville to evacuate were unexpected and triggered panic Sunday evening. Some people abandoned their cars on the highway and left with the clothes on their back after the Department of Water Resources announced that an emergency spillway would fail within the hour.

Honea shot down rumors the evacuation could end Monday afternoon. They’re working on a “repopulation” plan but there’s no timeline. “Getting those people home is important to me. But I have to be able to sleep at night knowing they’re back in that area,” he said.  His department had to move 500 inmates from Butte to Alameda County jail during the evacuation. They’re being held there for the time being.

This means that the over 188,000 residents of Yuba, Sutter and Butte counties who were ordered to leave their homes, are now in limbo and may not be able to return until the barrier at the nation’s tallest dam is repaired, according to Sheriff Honea. He did not say how long the fixes could take and offered no timetable for lifting the evacuation order. It also remains unclear what the current status of the plan to drop loads of rock on the eroded spillway at Oroville using helicopters.

Meanwhile, recalling the evacuation, local resident Nancy Borsdorf described a scene of chaos on her way out, including drivers abandoning cars as they ran out of gas. “People were just panicking,” said Borsdorf, who was at a shelter Monday in Chico.

“We’ve always loved and trusted our dam,” she said, having lived in Oroville for 13 years. “I’m really hopeful Oroville wasn’t flooded.”

Asked if the spillway was supposed to handle far more water, the acting head of California’s water agency said he was “not sure anything went wrong” on the damaged spillway according to AP. Bill Croyle said sometimes low-flow water can be high energy and cause more damage than expected. His comments came after officials assured residents for days that the damage was nothing to be concerned, then ordered everyone to get out in an hour.

The water level in the lake rose significantly in recent weeks after storms dumped rain and snow across California, particularly in northern parts of the state. The high water forced the use of the dam’s emergency spillway, or overflow, for the first time in the dam’s nearly 50-year history on Saturday. 

The sudden evacuation panicked residents, who scrambled to get their belongings into cars and then grew angry as they sat in bumper-to-bumper traffic hours after the order was given. Raj Gill, managing a Shell station where anxious motorists got gas and snacks, said his boss told him to close the station and flee himself. But he stayed open to feed a steady line of customers.

“You can’t even move,” he said. “I’m trying to get out of here too. I’m worried about the flooding. I’ve seen the pictures — that’s a lot of water.”

“It was so scary. It was like a bad movie, everyone was panicking and driving crazy. It was really scary,” said Maribel Cervantes, 35, of Yuba City. Cervantes threw some clothes in a hamper and joined throngs of evacuees fleeing Yuba City late Saturday. She said she’s worried about getting back to work as a nursing assistant, but she still has deep concerns about potential flooding.

“How can they assure us that it’s safe?” she asked. “How can we be 100 percent sure when one minute they’re saying the spillway was about to collapse?”

Raul Nava, 29, waited until about midnight to leave his home in Yuba City. “We’re scared about flooding, our house is right next to the levees,” he said. “We just packed food, water, you know the basics, and headed out.”

Nava said he and his wife and his dad first tried to get in to an evacuation center in Colusa but were turned away. It took them five hours to reach the shelter in Woodland, he said. With him he brought his two pit bulls, and 10 pit bull puppies. “We’re ready to go home,” he said.

Merida Lozano, 40, of also of Yuba City, said she too left in a hurry Saturday afternoon. She and her four kids got to the emergency shelter at the Yolo County Fairgrounds around 1 a.m. after being turned away from several area hotels that were full, she said. “We had no clue what was going on until about 4, when we heard about the evacuation orders,” Lozano said. “The roads were empty and all of the sudden there were cars everywhere. My emotions are all over the place…at least we made it here with the kids.” Lozano said her sister stayed behind in Yuba City.

“We’re just waiting to go home right now,” she said. “I hope they learn from this and reinforce the spillway so that we aren’t in this position if this were to ever happen again.”

A Red Cross spokeswoman said more than 500 people showed up at an evacuation center in Chico, California. The shelter ran out of blankets and cots, and a tractor-trailer with 1,000 more cots was stuck in the gridlock of traffic fleeing the potential flooding Sunday night, Red Cross shelter manager Pam Deditch said. A California Highway Patrol spokesman said two planes would fly Monday to help with traffic control and possible search-and-rescue missions.

Other shelters have been reporting they are now full.

The Paradise Alliance Church is not longer accepting new evacuees. If seeking shelter visit https://t.co/zmTLivT9tA for updated list.

— Butte County, CA (@CountyofButte) February 13, 2017

While some shelter sites were at capacity, people were still trickling in to the Yolo County Fairgrounds Monday morning. The parking lot was about half full, and deliveries of cots and water were still coming in. Yolo County health officials, law enforcement and mental health experts were on site to assist.

To manage the chaotic exodus and ensure evacuated towns do not become targets for looting or other criminal activity, at least 250 California law enforcement officers were posted near the dam and along evacuation routes. 

This afternoon Oroville vice mayor Janet Goodson, who is marooned in Red Bluff after evacuating Sunday night, said she respects and understands the sheriff’s call for continued evacuations, and says that safety is the foremost issue, but she said she also feels frustrated.

“To be honest with you, there is a degree of frustration,” she said quoted by the SacBee. Asked whether it was a mistake not to have done more to improve the spillway earlier, she said she prefers to look forward.

“We are where we are,” she said. “We can learn from mistakes, things we failed to recognize. We have to move forward in a collaborative fashion and make sure this does not happen in the future. This is a learning experience for us.”

* * *

The California National Guard notified all its 23,000 soldiers and airmen to be ready to deploy, the first time an alert for the entire California National Guard had been issued since the 1992 riots in Los Angeles. So far their services have not been needed and the only incident to date came after Oroville police said they made one arrest and have identified a second suspect in connection with two looting crimes that occurred Sunday night.

Suspects smashed windows at a Dollar General and a liquor store, stealing alcohol and food. “Is it looting? That (term) probably does apply. We’re just calling it burglary,” Police spokesman Joe Deal said.

Otherwise, there have been few calls for service and few problems in town since the Sunday night evacuation call. Deal said 25 officers are on patrol, focused on residential areas and low-lying areas near the river. Oroville police are being supplemented by officers from the Orland police department, the CHP, and the sheriff’s department. Most calls Monday have been from people asking police to check on the welfare of relatives or friends.

* * *

But the biggest criticism facing officials is that the sudden decision Sunday to evacuate tens of thousands of people was a departure from earlier assurances, when officials had stressed the Oroville Dam itself was structurally sound. Unexpected erosion chewed through the main spillway during heavy rain earlier this week, sending chunks of concrete flying and creating a 200-foot-long, 30-foot-deep hole that continues growing.

Officials are most concerned about the dam’s emergency, earthen spillway that began taking on water after water was diverted from the main concrete spillway because of the damage. Engineers do not know what caused the cave-in. Chris Orrock, a Department of Water Resources spokesman, said it appears the dam’s main spillway has stopped crumbling even though it is being used for water releases.

The lake is a central piece of California’s government-run water delivery network, supplying water for the state’s Central Valley agricultural heartland and homes and businesses in Southern California.

via http://ift.tt/2l9d4FN Tyler Durden

The Chief White House Correspondent for the NY Times, Peter Baker, appears to be having a Twitter meltdown after being passed over for a question during a press conference with Canadian Prime Minister Jason Trudeau – taking a backseat to lesser known ABC affiliate WJLA and the Daily Caller.

Baker is pissed that the MSM didn’t get a chance to hijack the Q&A to ask a completely unrelated question about General Flynnn’s reported pre-inaugural contact with Russia to discuss sanctions – because if true, trying to mend relations after Obama ejected 35 Russian diplomats and instituted sanctions over thinly supported hacking claims is a bad thing.

Right guys – reporters who fail to try and sandbag the President with questions unrelated to the press conference should be ashamed of themselves. Give me a break.

Maybe don’t hire reporters who call the First Lady a hooker and you’ll get called on more? 

Sat next to a journalist from the NYT last night who told me “Melania is a hooker.” Whatever your politics it’s crucial to call this out for

— Emily Ratajkowski (@emrata) February 13, 2017

 

Content originally generated at iBankCoin.com * Follow on Twitter @ZeroPointNow

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After years of investigations over alleged drug-trafficking and money-laundering, Venezuela's vice-president Tareck El Aissami faces sanctions by US authorities as a "specially designated national." El Aissami would be the highest-ranking Venezuelan official hit by U.S. sanctions, and we are sure will warrant a furious response from President Maduro who has already accused US of 'economic war' numerous times… and being responsible for forcing his people to resort to eating flamingoes now.

The sanctions mark an extraordinary step against the second-in-command of a foreign government and are sure to lead to a further deterioration in U.S. relations with the government of Venezuelan President Nicolas Maduro, who appointed El Aissami as vice president on Jan. 4 amid a deepening economic and humanitarian crisis. El Aissami, the son of Syrian and Lebanese immigrants, has long been one of Venezuela’s most controversial and feared politicians. In just over a decade, the 42-year-old climbed government ranks from a student leader in rural Venezuela, to interior minister, to his previous post as the governor of Aragua state.

After being tapped by Maduro to lead a "commando unit" against alleged coup plotters and officials suspected of treason, Bloomberg reports, his ascent prompted a bipartisan group of U.S. lawmakers to call last week for further measures against Maduro’s government. In a Feb. 8 letter to President Donald Trump, 34 members of Congress including Senators Ted Cruz and Robert Menendez cited El Aissami’s appointment and urged the U.S. to “take immediate action to sanction regime officials.”

Amid hyperinflationary chaos,  El Aissami, nicknamed “the narco of Aragua” by Venezuela’s beleaguered opposition, has thrived. As Bloomberg details, critics allege he has used his vast political network to help turn the country into an international hub for drugs. The State Department, in its 2015 International Narcotics Control Strategy Report, described the Caribbean nation as a “major cocaine transit country,” citing “endemic corruption throughout commerce and government, including law enforcement.”

The vice president’s ties to the nation’s civil registry services before he became interior minister have also fueled accusations by U.S. investigators that he’s aided Middle Eastern extremists by allowing them to create Venezuelan identities and a web of front companies to move money outside the country’s borders.

 

The U.S. move would worsen a relationship long strained by mistrust and Venezuelan accusations that Washington supported a failed attempt to overthrow then-President Hugo Chavez in 2002. In the years following the attempted coup, Chavez aggressively criticized U.S. ties to Latin America, helped lead rallies around South America against “Yankee aggression” and nationalized investments by companies including U.S.-based Exxon Mobil Corp.

Meanwhile, as the so-called "narco of aguara" enjoyed the high-life, the people of his socialist have resorted to eating flamingoes and anteaters… (as The Miami-Herald reports)

Biology student Luis Sibira stumbled across the first set of gory remains last November: eight pink flamingos, their breasts and torsos sliced out, leaving their heads, spindly legs and vivid feathers scattered across the marshy ground at Las Peonias Lagoon in western Venezuela.

 

Flamingo hunting is both illegal and unusual at the lagoon, less than 200 miles from the Colombian border. Sibera, who had been studying the pink birds that nest there for years, had never seen anything remotely like that before.

 

 

Since then, though, he's seen at least 20 similar cases, most recently in January, when he found several carcasses hidden under shrubs, with a shotgun shell nearby.

 

But this isn’t simple poaching, he said. Sibira and other investigators from Zulia University, a public university in Maracaibo, are convinced that the protected birds have become the latest victims of Venezuela's growing hunger crisis. People have become so desperate, he said, that they are butchering and eating flamingos.

 

There are other signs that food shortages have led to the slaughtering of animals not generally considered meat: giant anteaters, for one.

Of course, Amduro will use this as an excuse to blame the 'yankees' for the utter horror that his policies have uneleashed on a once wealthy nation.  Ricardo Boscan, the head of Maracaibo’s waste collection department, said that six out of every 10 garbage bags or trash cans are being looted by hungry people. “The situation has gotten worse since 2015," he said. "It’s happening because hunger is rising to a massive scale.” But resorting to flamingos is something new.

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

Trump’s weekend golf getaway with Japanese Prime Minister Shinzo Abe to Mar-A-Lago (a.k.a. “The Winter White House”) is getting increasingly bizarre by the second.  Earlier today we wrote about Richard DeAgazio, a 72-year-old Palm Beach businessman, Trump supporter, actor and Mar-A-Lago member, who decided post selfies to Facebook with the “Nuclear Football” then proceeded to effectively live blog Trump and Prime Minister Abe’s reaction to an international crisis involving a North Korean missile launch (see “Random Mar-A-Lago Guest Posts Selfie With “Nuclear Football” Briefcase“).

But, in the midst of entertaining a foreign leader and addressing an international crisis with a rogue state, Trump apparently also found time to crash the wedding of Vanessa Jane Falk (36) and Carl Henry Lindner IV (33) at his signature resort.  And, lest you think we’re joking, here is a picture of Trump with the happy couple:

 

And, of course, the obligatory picture with the bridesmaids…no doubt that kisses were given all around.

 

Unfortunately, the fun doesn’t end there as the President decided to deliver a personal toast to the bride and groom at their reception.  Everything started off just fine with the customary congratulatory remarks but turned back to the slightly bizarre when Trump decided to thank the couple of being long-time members of Mar-A-Lago, a membership for which he noted they had “paid him a fortune.”  Per CNN:

“I saw them out on the lawn today,” Trump said of the bride and groom Saturday, who were standing nearby. “I said to the Prime Minister of Japan, I said, ‘C’mon Shinzo, let’s go over and say hello.’ “

 

“They’ve been members of this club for a long time,” Trump said of the newlyweds. “They’ve paid me a fortune.”

Of course, with Democrats already calling for impeachment proceedings over “conflicts of interest” related to Trump’s business interests, we just can’t wait for Nancy Pelosi’s response to this one…

via http://ift.tt/2kpW6Pm Tyler Durden

On February 13th, 2017 residents in Oroville, CA, were given a last second, panicked directive to evacuate their homes and flee the area due to concerns that the Oroville dam was about to imminently fail. At the time of this article, the dam has still not yet failed. Should it fail though, California’s government may face tough questions about their failure to adequately prepare for a disaster they had been warned about for over a decade.

California negligently failed to make preparations for the inevitable end to a major drought which had occurring since 2011. For 12 years, environmental groups had warned federal and state officials that the dam was likely to experience structural issues in the event of heavy rains and flooding. Governor Jerry Brown had years to direct the Democrat controlled state government to authorize funding and enact plans for repairs to the dam while water levels remained low. The Water Quality, Supply, and Infrastructure Improvement Act of 2014 set aside $395,000,000 for flood management, but to date has not allocated any of it to actual repairs or projects, raising questions about where the money currently sits and what it has been used for since 2014.

California’s corruption causes it to consistently approve projects which are financially and logistically convenient for special interest groups at the expense of their citizens. Energy companies in Southern California are currently being sued by citizens over plans to bury nuclear waste from the reactors at San Onofre, California underwater in thin canisters without any clear explanation about how they would monitor the storage devices or explaining how the canisters will be removed once the 20 year approval permit has expired. The ill conceived project was approved by the California Coastal Commission in 2015. The California Coastal Commission was created by Governor Jerry Brown and has been itself the source of controversy after they fired their executive director Charles Lester, who was described as an “essential line of protection between developers and environmentalists.” The Commission is currently the subject of multiple lawsuits, all of which allege that Coastal Commission members have had improper private contacts with permit applicants (ex-parte communications) with developers or their representatives prior to voting on those permits.

Jerry Brown himself has recently come under scrutiny as well, after a February 1st, 2017 report by the Los Angeles Times revealed that Governor Brown still retained $15 million in campaign funds with no clear guidelines as to how he would spend it. This story follows reports that Brown’s Chief of Staff Nancy McFadden took over a million dollars from Pacific Gas & Electric Co. and continued to hold stock in PG&E despite playing a key role in the appointment process for new members of the state Public Utilities Commission, which regulates PG&E and other California utilities (including the ones behind the controversial plans for San Onofre’s nuclear waste).

via http://ift.tt/2ld546o William Craddick