US Trade Deficit Shrinks On Biggest Spike In Food & Beverage Exports In History

Forget the new economy, it appears - judging by July's preliminary trade data - that USA's great export is 'food and beverage'. Thanks to a 31.3% surge month-over-month in this category - the biggest MoM gain in history - the US trade deficit 'improved' to -$59.3bn (from -$64.5bn revised lower) and beat expectations of -$63bn.

Q2 GDP Revised Lower To 1.1%, As Expected, Even As Personal Consumption Rises

In what has been called the economic equivalent of hitting 00 on roulette, moments ago the BEA announced that Q2 GDP eased off from the original estimate of 1.2%, declining fractionally to 1.09%, and right on top of consensus etimates, which also expected a 1.1% print in the second quarter. This means that following the disappointing Q1 print of 0.83%, the first half economic growth is now officially just below 1%, or 0.096% to be precise.

Inventory Growth Slowdown Dashes Hopes For Q3 GDP Bounce Back

Following the surge in sales (on higher petroleum costs) in June (and modest build in inventories), the sales-stock ratio fell back from cycle highs (though remained deep in recessionary territory). July's preliminary data showed a notable slowdown in inventories (-0.02% vs a 0.1% expected gain and revised lower 0.2%) confirming recent PMI data of no pickup in growth in Q3. For 32 months straight, inventory growth has outpacced sales growth year-over-year with 18 straight months of wholesale sales declines.

"Will Yellen Shock Today?"

Well, we made it. It’s finally Janet Yellen day. Has a speech by a Fed Chair ever been anticipated, dissected and stressed over to this extent? It’s partially down to the fact that she has largely, even unprecedentedly, made herself unavailable for public comment. Sending her minions out to confuse us. But more distressingly, they have put themselves in a situation where a measly 25 basis points looms like a life-changing event. 

Frontrunning: August 26

  • Global equities set 2-week low before Yellen speech, dollar dips (BBG)
  • Lochte signs new endorsement deal, legal woes persist in Brazil (Reuters)
  • Blackstone Unleashes Cash Hoard in Texas Shale Oil Land Grab (BBG)
  • China to prosecute former statistics bureau chief for corruption (Reuters)
  • Turkey fires on U.S.-backed Kurdish militia in Syria offensive (Reuters)

In Surprising Twist, Ackman Named As Potential Buyer Of Icahn Herbalife Stake

Having won the battle with Bill Ackman over the existential legality of Herbalife, who owns 18% of the nutritional company, has found himself in a curious place: with no further upside catalysts and with the company levered to the neck with recent buyback-funding debt issues, there is litle upside left. In fact, the stock has been drifting lower ever since the settlement. Which is why, perhaps it is not surprising, that as the WSJ reported overnight, Icahn has been quietly shopping his stake in Herbalife to a group "including the company’s arch-nemesis William Ackman,

With Janet Yellen Just Hours Away, Directionless Markets Wait For A Signal

With Yellen's much anticipated speech just hours away, the already comatose market flatlined overnight in another directionless session, with European stocks and US equity futures practically unchanged, while Asian shares to a two-week low, led by Japan, as investors showed a reluctance to take on risk before Yellen’s speech. The dollar was a tad lower, along with oil which is set for its first weekly drop in a month. 

"Things Are Worse" - Dollar Stores' Startling Admission: Half Of US Consumers Are In Dire Straits

"I know that when we look at the overall U.S. population, it seems like things are getting better. But when you start breaking it down and you look at that core consumer that we serve on the lower economic scale that's out there, things have not gotten any better for her, and arguably, they're worse because rents are accelerating, healthcare is accelerating." - Dollar General CEO, Todd Vasos

Assange Assassination Attempt? Cops Took 2 Hours To Respond To Embassy Breach

The Wikileaks Twitter account reported early this week that an unidentified man attempted to scale the wall of the Ecuadorian Embassy in the U.K. at 2:47 am. The “cat burglar” escaped security and managed to flee to safety while embassy security waited two hours for U.K. police to take the two minute walk from the police station to the embassy housing internationally-known whistleblower Julian Assange

Risks Of Loose Money - Exposing The Link Between Monetary Policy And Social Inequality

... what we are looking at is a flawed system that penalizes saving and encourages reckless spending and printing money. Although we all appear to be stuck in the same environment that combines negative interest rates and price inflation, we have the lower strata of society that is doomed to lose, as they end up spending more, discouraged by negative rates, and instead accumulate debt to keep up with the increasing prices. And then we have the “winners”, who know how to take advantage of the system and thrive in it...

Jackson Hole Conference Schedule And List Of Attendees Released

The Kansas City Fed has released the schedule of its two day Jackson Hole symposium which, officially kicked off with dinner on Thursday night, hosted by dissident regional Fed president, and dissenter, Esther George (she voted against Yellen's decision to keep rates unchanged in March, April and July). The highlight is tomorrow's 10am ET Janet Yellen speech titled "The Federal Reserve’s Monetary Policy Toolkit."

At least 1 Dead, Multiple Injured In Major Explosion At Belgian Sports Complex

A powerful explosion went off just after midnight local time at the Plaine Chalon sports facility in Chimay, Belgium, partially destroying the building and burying an unknown number of people under the rubble, local media report. At least one person is reported dead and four were injured (two seriously) after the building collapsed, Belga News Agency reported citing emergency services spokesperson.

Restaurants In D.C. Slash Jobs After Minimum Wage Hike

In yet another stunning example of the unintended consequences of minimum wage hikes, restaurants in Washington D.C. are slashing jobs.  "The last time DC experienced restaurant job losses in five out of six consecutive months was 25 years ago in 1991, and the last time 1,400 jobs were lost over any six-month period was 15 years ago during the 2001 recession."

The Disgusting Silence Fueling Crony Capitalism

Free market capitalism - the very heart, soul, and driving engine that has propelled technology, medicine, transportation, manufacturing, efficient markets, and so much more - is not only under assault; it is being left out to hang like some dried, dead leaf by the very people who should be at the forefront for its defense. i.e., CEO’s and business leaders of all stripes. Yet, so far – the silence is deafening.