Second Militant Group Threatens Niger Delta Oil

It is no longer just the "Niger Delta Avengers" that hold the price of oil in their hands. The Ultimate Warriors of the Niger Delta, a new militant group operating from its namesake river delta, is demanding that the Nigerian government give 60 percent of oil and gas revenues to the people native to the Niger Delta region, according to a Wednesday report by Today.ng.

 

As OilPrice.com's Zainab Calcuttawala details,

The group presented the order as a condition for a possible ceasefire after attacks it has committed, along with those perpetrated by the Niger Delta Avengers, have caused a 50 percent fall in national oil production.

 

‘Gen’ Sibiri Taiowoh, the group’s spokesperson, said on Wednesday that attacks on oil facilities would continue until the $16 billion Export Processing Zone and the Federal Maritime University projects that former President Goodluck Jonathan began had been fast-tracked for completion.

 

The next targets would be Chevron BOP, Okan Platform, MEREN Gas Gathering Compression Platform and the Chevron Tank Farm if the government did not meet the group’s demands within two weeks, according to the statement.

 

“We are also behind the recent pipeline bombing in the Niger Delta region and I can assure you we will not stop until the Export Processing Zone (EPZ) project and the Maritime University are totally completed and start operations,” the document read. "We would resist any attempt to give surveillance contracts of pipeline in our backyard to foreigners. We want the pipeline jobs to be given to our indigenous people.”

 

The group, which, like the Niger Delta Avengers, vows not to kill innocents and cause only property damage, also spoke out against what they consider to be the misdistribution of oil profits, as 80 percent of the money has been given to regions in non-oil producing areas.

 

Since the people of the Niger Delta suffer “the brunt of oil pollution and degradation in the region,” the group insists that residents should receive at least half of the oil profits.

 

The Niger Delta Avengers rejected an invitation by the government to negotiate a peace agreement this week and proceeded to blow up one of Chevron’s wells.

As we concluded previously, so another group of "young, east-Europe educated idealists", who have a "patriotic agenda" and are intent on achieving an independent state in southeast Nigeria. To do this they will blow up every piece of oil infrastructure in their way.

At least, unlike Hans Gruber, they don't also demand the release of their ideological "revolutionary brothers and sisters" rotting away in some imperialist prison.

Meanwhile, the price of oil will remain high and keep rising as long as the NDA's campaign continues oddly unopposed.

What is odd is how unexpectedly these groups of African "freedom fighters" emerged, and created a website no less just as oil hit a 13 year low. One almost wonders if there was not certain western financial and military backing behind said group of "freedom fighters", perhaps backing that has an interest in the price of oil going higher, and thus any sunk costs to fund and arm the NDA would be promptly recovered once oil jumped… as it has in the past week as a result of none other than Goldman highlighting Nigeria's oil supply problems and making it the basis for their "bullish" (if only in the shorter-term) oil call.

Of course, that would never happen: after all, when in the history of the US has the country, either directly through the government or indirectly through the private sector, armed and funded offshore "rebel" groups to achieve specific national interest goals…

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“A Supernova That Will Explode”: Bill Gross’ Dire NIRP Warning

When it all comes crashing down, nobody will be able to say that the biggest asset bubble in history wasn’t obvious. Here is the latest warning, a rather hyperbolically florid one, courtesy of Bill Gross.

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Wholesale Inventories Rise Most In 10 Months, Sales Miss; Ratio Only Higher Post-Lehman

Wholesale inventories rose more than expected in April (up 0.6% MoM vs 0.1% exp) – the biggest monthly jump in 10 months – but sales disappointed (rising only 1.0% versus a 1.1% expectation). This sales growth topping inventory growth is a positive but for context the inventory-to-sales ratio remains at 1.35x – the highest level ex-Lehman on record.

They just keep building inventories… even as sales remain lower YoY…

 

The absolute “wholesale trade gap” did drop modestly…

 

While inventory-to-sales ratio did drop modestly, we remind ‘investors’ that the only time it was higher than this was in the immediate aftermath of Lehman…

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Donald Trump No Excuse for Hillary Clinton’s Foreign Policy Mistakes: New at Reason

What was supposed to be a “major national security address” by Hillary Clinton ended up being about Donald Trump.

W. Jim Antle writes:

Hillary Clinton remains an unrepentant hawk, but insists her track record of supporting American military intervention abroad is less likely to lead to conflict than what Donald Trump says on Twitter.

That is the argument Clinton advanced Thursday in what was billed as a major foreign policy address but more frequently devolved into a critique of Trump’s social media habits.

“Imagine him deciding whether to send your spouses or children into battle,” Clinton said. “Imagine if he had not just his Twitter account at his disposal when he’s angry, but America’s entire arsenal.”

It’s a good line and Trump does often make statements that are counterproductive or inflammatory. But we don’t have to imagine Clinton sending our spouses or children into battle, under circumstances that advanced neither our vital national interests nor our security. She has already done so multiple times and should not be let off the hook because of Trump’s tweets.

View this article.

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US Tax Receipts Signaling Recession?

Submitted by Michael Shedlock via MishTalk.com,

US federal personal tax receipts receipts are falling fast. So is the Evercore ISI State Tax Survey.

The last two times the survey plunged this much, the US was already in recession.

Is it different this time?

ISI Tax Receipts

I like to credit my sources. I picked that chart up from Liz Ann Sonders, Senior Vice President, Chief Investment Strategist, Charles Schwab & Co., Inc.

In turn, Sonders picked that up from Evercore ISI.

I added the recession bars and comments.

Each month, Evercore conducts a State Tax Receipts Survey across 16 states capturing 64% of the US population.

Unlike Sonders, I am not willing to state second GDP quarter will likely be up vs. first quarter.

Second Quarter GDP Estimates

  1. New York Fed Nowcast June 3: 2.4% New York Fed Nowcast Up to 2.4% (I’ll Take “The Under”); Modeling Error on Unemployment Rate?
  2. Atlanta Fed GDPNow June 1: 2.5% GDPNow Forecast Dips to 2.5% Following Construction Report
  3. Markit June 3: 0.7% to 0.8% Composite PMI Flirts With Contraction; Markit Chief Economist Estimates GDP 0.7-0.8%
  4. ISM June 3: 1.6% Non-Manufacturing ISM Much Weaker Than Expected

Manufacturing Productivity

Manufacturing Productivity 2016-06-07C

For productivity discussion, please see Productivity Declines 0.6%, Labor Costs Rise 4.5%; What’s Going On?

Recession?

Many things are outright screaming recession.

I expect huge revisions on numerous fronts. And I am not the only one.

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6 rules I follow when making any investment

This morning as I glanced at the headlines, I had to sit back and wonder– when did the world get so crazy?

Interest rates across the West are at zero or negative.

Bankrupt governments are selling 100-year bonds with tiny interest rates, while others have convinced investors to pay for the privilege of loaning them money.

What really gets me is that people aren’t laughing. Serious investors are buying up the $10+ trillion worth of negative-yielding debt issued by bankrupt governments as fast as they can.

After all, everyone else is doing it.

Yesterday I told you how, at age 20, I borrowed a bunch of money and did what everyone else was doing at the time– buying Internet stocks at the height of the dot-com bubble in 1999.

I lost everything within a year.

And ever since I left the military more than a decade ago, I’ve dedicated a huge portion of my time, money, and effort toward learning from the sharpest people I could find.

I traveled to nearly 120 countries to build relationships with brilliant mentors in order to learn what I never could in school.

For example, I never went to business school.

But based on what I learned from my business mentors, I’ve been able to build five successful companies that now employ over 125 people on four continents.

From my investment mentors, I learned how to not be such an idiot… how to ignore the crowd and focus on the core fundamentals of a business.

One of my value investing mentors explained to me, for instance, that if you’re going to invest in the stock market, you should buy a single share as if you’re buying the entire business.

And he laid out six rules to follow when making any investment:

1. Always consider the risks before even thinking about how much you can make

Sometimes it’s worth taking huge risks where there’s a good chance you’ll lose everything.

Startups are a great example; there was a 95% chance that Google was going to fail when it first launched. But the return has been more than 100,000x the initial investment.

Clearly that kind of return is worth the risk.

Conversely, if you buy and hold 5-year Japanese government bonds right now, you’re counting on the second most bankrupt government on the planet to pay you back.

Bear in mind that Japan’s government is so broke they spend 40% of tax revenue just to service the debt.

And in exchange for taking on such substantial risk for five years, your reward is a whopping NEGATIVE 0.25% per year.

In comparison, it hardly seems worth it. Know the risk, and make sure the reward is worth it.

2. Don’t invest unless you know WHY

Before making any investment, have an objective. After all, there are a lot of different reasons to invest.

Sometimes you might be seeking income, i.e. buying rental real estate for the cash flow.

Capital appreciation is another common goal; people are typically looking to turn a $100,000 investment portfolio into $500,000.

But there are other reasons as well: Asset protection. Hedging against financial/systemic risks. Reducing taxes. Estate planning. You can even invest to gain citizenship.

To accomplish any goal requires careful planning and disciplined execution, whether you’re trying to lose weight or save for retirement.

But you can’t ever create a plan unless you start with a clear objective.

3. Invest in people of integrity who have a track record of success.

Most investments are ‘managed’. Apple is managed by CEO Tim Cook and the Board of Directors.

Investments in government bonds are essentially ‘managed’ by the Treasury Department and all the politicians and bureaucrats.

Any investment with dishonest or incompetent management will ultimately become worthless. It’s simply a question of time.

A great asset managed by competent people of integrity will be a winner.

4. Buy assets that generate vast amounts of cash flow.

No exceptions. A profitable business (or any asset that produces safe, strong cash flow) makes sense in any environment: inflation, deflation, stagnation, etc.

5. Avoid excessive debt.

Borrowing can be a good thing, especially when interest rates are low like they are today.

But too much debt leaves a company (or government) vulnerable and unable to pay its stakeholders.

6. Know the value of what you’re buying, and never overpay for it.

The bonds of bankrupt governments are selling at record levels right now. Tech companies like Uber that lose hundreds of millions of dollars have valuations in excess of $60 billion.

None of this makes any sense.

There’s something to be said for investing in growth, especially when you can get in at a very early stage (like being an early investor in Google).

But paying out the nose to buy losing companies or bankrupt government bonds makes no sense.

Know exactly what a company is worth. With stocks, for example, you can look at a company’s “net tangible assets” — all of its physical, disposable assets minus its liabilities.

For example, if a company has $1 million in cash, $1 million in inventory, and $500k in debt, then its net tangible assets equal $1.5 million.

Buying well-managed, profitable companies that sell near (or even below) the values of their net tangible assets provides a substantial margin of safety.

This is a core principle of value investing. The whole concept is to essentially buy a dollar for 80 cents.

If you’re just getting started and you don’t yet understand a lot about finance, definitely learn about value investing.

The idea is incredibly simple, and its proven long-term track record outperforms all the other popular hotshot strategies.

Learning about value investing means learning about the inner workings of business, money, and cash flow.

It’s a fantastic foundation to your financial education, which is truly one of the best investments you can make.

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New Episide of The Fifth Column Features Anthony L. Fisher on Muhammad Ali’s Anti-War Legacy, and So Much More

On this week’s episode of the only podcast you will ever need — The Fifth Column — Kmele Foster, former Reasoner Michael C. Moynihan, and Reason magazine editor-in-chief Matt Welch were gracious enough to invite me back on to kick around such various topics as Donald Trump getting called out (but not disowned) by Republican bigwigs for his overt racism, Bernie Sanders being accused of misogyny by a New York Times reporter, and the latest edition of #SomeIdiotWroteThis. Plus, Moynihan and Welch give us an inside peak at what it’s like to be a guest (and how hard it is to make a cogent point) on Real Time with Bill Maher. 

Stick around for the end when Foster takes me to task for what he claims was my “whitewashing” of Muhammad Ali’s legacy. Suffice to say, I don’t take the critique lying down. But this is a great example of why The Fifth Column is worth your time — it’s not an echo chamber or a back-slapping confab of the like-minded — mixing it up is the name of the game. 

Be sure to visit the podcast website for info on how to subscribe; it’s also available on iTunes, Stitcher, and Google Play.

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Gartman Warns “Buying Equities Here Shall Be In The End An Ill-advised Action”, Compares Ackman To Madoff

Soros, Druckenmiller, Icahn, Goldman, Deutsche, and now… Dennis Gartman.

From the latest letter by the “world-renowned” commodity expert who at last check was “pleasantly long.”

We begin then by noting that the CNN Fear & Greed Index is still above 80 in openly “greedy” and thus openly over-extended-to-the-upside territory. Some might call this “nose-bleed” territory and we shall strongly… indeed very strongly…suggest that buying equities here shall be in the end an ill-advised investment philosophy or action.

Bad news for the bears? Not really:

We remain, however, modestly net long of equities given that we are still long of aluminium; long of a small energy production company’s shares and long of a high-tech, “Cloud” related company’s shares, all of which have done quite well recently. We are long too, of course, of gold in EUR and Yen denominated terms; but we have derivatives positions in place sufficient to reduce our net long position to something which we’ve referred to as “pleasantly” long: long, but not materially so. We shall sit tight then and do nothing more… at least for the moment.

And then, another swipe at Bill Ackman, one which may well provoke a response as Gartman goes so far as comparing Ackman to Madoff:

Finally, concerning what has happened of late to Pershing Square and Mr. Ackman, we had a discussion with a friend in the hedge fund industry yesterday… a “rival” of Mr. Ackman’s… whose “take” on this question was most interesting. Our friend is convinced that Mr. Ackman’s effect upon the hedge fund industry may in the end by more dismaying than the effect that Mr. Madoff had upon it, for Madoff was a  matter of criminality that should have been discovered but was hidden for a long while from view, while Ackman’s actions have been long standing, inexorable and perhaps repeatable by others, creating fear amongst institutional investors who will, in the future, be unwilling and/or unable to put money at risk in these same manners. Money will not, in the future, allow itself to be gated, and in response the entire hedge fund industry will be diminished.

 

Once again, averaging down into long positions while averaging up into short positions… and continuing to do so even as the trend is clearly against one… is what we have referred to as the sole “carcinogen” in the investment/trading business. The demise of Nick Leeson; the collapse of Sumitomo Metals; the problem caused by Mr. Kerviel at SocGen… all came about by adding to losing positions and by disregarding risk. It is our duty to avoid such nonsense. Hopefully we shall continue to do so.

Of course, the best way to avoid such nonsense is to just keep trading one’s “retirement portfolio.”

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EBT Card Outage? 8 Days Into June And Many Americans Are Still Waiting For Food Stamp Money

Submitted by Michael Snyder via The Economic Collapse blog,

Widespread reports continue to pour in from all over the nation of “glitches” with the food stamp system.  It is eight days into the month and large numbers of people still have not received their benefits, and in other instances it is being reported that EBT cards are simply not working correctly.  So what in the world is going on here?  On downdetector.com there are scores of reports of problems with the EBT system from people all over the nation.  Could this simply be another example of government incompetence, or is something else at work here?

I had heard some rumblings about this over the past few days, but I had not really taken them seriously until I read an article from highly respected author Ray Gano…

It interesting over the weekend I got several emails telling me about cell phones being down, internet being down, and get this, EBT cards not working and having no money associated to them.

 

This is a concern because when the US Government has payment failures, then there is possibly something happening that the press is not telling you about.

 

Now, we know that computers have problems and that states, counties and cities run on computers. But what is interesting is that since the beginning of 2016, The US government has had over 2,700 reports on downdetector.com showing that they have been late loading the money onto these EBT cards.

 

Folks, we are now going on 8 days where the Government has not paid the EBT payments so that people have food.

So I went over to downdetector.com myself, and I was stunned to see that reports of EBT outages continue to pour in every hour.  Here are just a few of the recent comments that have been left by people that are still waiting for their food stamp benefits for June…

Heidi Lynn: I was supposed to get mine on the 5th and still nothing. Even ebt NJ site says $0 as well as my EBT card says $0. I’m on disability. I forgot to add I tried calling NJ Board of Services and was on hold for over an hour. I had to hang up to take dog out, etc. Does anyone know what’s going on yet?

 

Ann Wilson: Now that it’s been a whole week since I was supposed to get my June benefits, and haven’t, I’m planning on going to my Illinois FCRC office. I hope they will be able to fix this difficulty.

 

Jenn Johnson: I always get mine on time. I was due to get mine today June 7th and nothing. I am from kentucky. Why is there nothing on the news about this?

 

Jarrett Manhart: Havnt received mine either. They are never late. And my fone is off so i cant call em. Im on Wi-Fi down the street from me.

 

Sunny Nicole Jones: I haven’t gotten mine either! I’m glad it’s not just me though because then I would really be worried!

But when I went to confirm these widespread outages with articles from the mainstream media, I came up empty.

Either the mainstream media does not know what is going on yet, or it is being ignored.

If you have not gotten your EBT benefits for this month yet or you know someone that is in that position, please feel free to let me know.  I want to get to the bottom of this.  There are people all over the nation that are reporting problems with the food stamp system, but nobody seems to know exactly how widespread this issue is just yet.

Today there are well over 40 million Americans on food stamps, and a lot of them would start rioting tomorrow if you told them that their food stamp cards were being turned off permanently.

EBT cards are the modern equivalent of the bread lines of the 1930s.  Instead of having to wait in long lines for food, the government just zaps money on to EBT cards each month, and those that are hurting are able to get something to eat.

But down in Venezuela, extremely long food lines are a daily reality for much of the population right now.  The following comes from the Daily Mail…

Venezuela was once South America’s richest nation, but a fall in oil prices combined with other economic problems has led to desperate citizens taking drastic measures.

 

Nearly half of Venezuelans say they can no longer afford to eat three meals a day, according to a recent poll by the local firm Venebarometro. The poll surveyed 1,200 adults at their homes during the first week of April and had a margin of error of plus or minus of about two percentage points

 

Those who can, cross the border into Colombia to buy, bring back and then use or sell food and other basic commodities.

Could you imagine not being able to provide three meals a day for your family any longer?

Close to half the population of Venezuela is already in that position, and the economic collapse down there grows worse with each passing day.

Most Americans just assume that nothing like that could ever happen here.

Most Americans just assume that the government will always have plenty of money to give out.

As I mentioned above, there are well over 40 million Americans that receive EBT benefits.

However, when you factor in all government programs, more than 100 million Americans get some form of money or benefits from the federal government each month.

So what would happen someday if suddenly the spigot was turned off?

What would those 100 million people do?

How would they survive?

Hopefully this current EBT outage is just a temporary technical glitch, and hopefully the government will get it fixed in short order.

But someday there will be a major crisis that will cause food stamp benefits to be cut off either permanently or for an extended period of time.

When that day arrives, what will that do to our communities?

This is coming soon…

As SHTFPlan.com's Mac Slavo notes, this isn’t the first such incident and it certainly won’t be the last as an evermore impoverished populace becomes increasingly dependent on government handouts.

In 2013 we reported that the EBT card acceptance system in 16 states crashed, leaving thousands with no way to put food on their dinner tables. As further evidence of what may happen following a widespread outage wherein those on government assistance have no way of buying food and other necessities, consider what this woman had to say:

I go to the register and they ask me “how you going to pay.”

 

I said with food stamps.

 

“Oh, we’re shut down, you can’t pay with food stamps.”

 

I got kids to feed. You know?

 

And because the government’s down I can’t feed my family?

 

…

 

What’s going on with America? Now they trying to starve us to death?

 

…This is crazy

 

…I got six kids I have to feed.

 

…

 

I’m just trying to figure out how to get something to eat.

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Pensions Timebomb In UK, EU and U.S. in “Slow Motion Detonation”

Pensions Timebomb In UK, EU and U.S. in “Slow Motion Detonation” 

Pensions in the UK, EU and internationally will go bankrupt as the long awaited ‘pensions time bomb’ detonates in slow motion.

Max Keiser and Stacy Herbert discuss the end of retirement which many Americans, Britons, Europeans and others will suffer as their pensions are decimated in the coming years due to zero percent interest rates and ultra loose monetary policies pursued for the benefit of banks and corporations.

Governments and central banks bailed out banks at the expense of pensioners and the pensions of workers who have been “thrown under the bus”.

In the second half, Max interviews Constantin Gurdgiev, Professor of Finance at Middlebury Institute of International Studies, about the debt situation in Europe and the NAMA and Irish water debacles.

Constantin points out how Ireland’s economic recovery, the EU’s ‘poster boy’ of recovery is tentative at best and based on less than sounds fundamentals.

Diversification remains the key to weathering the impact of the ‘pensions time bomb’. The traditional and typical retirement  or pension fund of simply owning a balanced portfolio of just paper assets – equities, bonds and a small allocation to cash – is now a recipe for financial disaster. This is especially the case given the rich valuations seen in stock indices globally but also the fact that global bond markets are at all time record highs due to QE and central bank’s ultra loose monetary policies.

Having a pension without an allocation to gold today is high risk in the extreme and gold has never been more important as a hedging instrument, safe haven asset and pension portfolio insurance.

Direct legal ownership of individually segregated and allocated gold coins and bars will again protect and grow wealth in the coming years.

Recent Market Updates
– Gold Surges After Poor Jobs Number, Growing Risk Of BREXIT
– Silver – Perfect Storm Brewing in the Market
– Martin Wolf: There Will Be Another “Huge” Financial Crisis
– Silver Price To Surge 800% on Global Industrial and Technological Demand
– BREXIT Gold Diversification As Vote Fuels Market Uncertainty
– Gold Forecasts Revised Higher – Citi Says “Buy the Dip”
– Gold Should Rise Above $1,900/oz -“Get In Now!”

www.GoldCore.com


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