http://www.zerohedge.com/fullrss2.xml/etf_headlines/etf_headlines/etf-in-focus-gxc-march-11-2013.html en Guggenheim CIO Warns "Everything Is Liquid Until You 'Need' To Sell" http://www.zerohedge.com/news/2017-11-23/guggenheim-cio-warns-everything-liquid-until-you-need-sell <p>The holidays came early to the world&#39;s investor class, as instead of 12 Days of Christmas, Scott Minerd, <a href="https://www.guggenheimpartners.com/perspectives"><em>Global CIO of Multi-billion-dollar Guggenheim Partners</em></a>, dropped his <strong>12 lessons for today&#39;s meltup-market participants.</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_minerd1.jpg"><strong><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_minerd1_0.jpg" style="width: 560px; height: 264px;" /></strong></a></p> <p><a href="https://twitter.com/ScottMinerd">In a series of tweets, </a>Minerd offers some clear-cut advice for the complacent many...</p> <p>He begins by noting &quot;<strong><em>The rally in risk assets is probably not over, but strength is an opportunity for investors to move towards the exits.</em></strong>&quot;</p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">The rally in risk assets is probably not over, but strength is an opportunity for investors to move towards the exits.</p> <p>&mdash; Scott Minerd (@ScottMinerd) <a href="https://twitter.com/ScottMinerd/status/932599358666797056?ref_src=twsrc%5Etfw">November 20, 2017</a></p></blockquote> <script src="https://platform.twitter.com/widgets.js"></script><p>Then explains...</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>Merkel&#39;s failure to effect a coalition increases the<strong> risks of longer QE from #ECB.</strong></p> <p>&nbsp;</p> <p>The<strong> myth of higher long term rates</strong> in the US ignores the risk that the business cycle&#39;s terminal rate may be lower than many think.</p> <p>&nbsp;</p> <p>With the neutral rate stuck at zero, a <strong>December rate hike will move the #Fed into restrictive territory.</strong></p> <p>&nbsp;</p> <p>The Senate plan to delay a corporate tax cut into 2019 is likely to create a <strong>massive drag on the US economy. Bad policy!</strong></p> <p>&nbsp;</p> <p><strong>The shape of the yield curve is telling us that we are on track for a recession</strong> and that monetary policy is becoming restrictive. The #tax bill is not a reason to rethink this signal.</p> <p>&nbsp;</p> <p><strong>Market phase has moved from recovery to fundamental and now to speculative. </strong>There&#39;s little price appreciation now, just clipping coupons. It is time to become more conservative and book gains.</p> <p>&nbsp;</p> <p>To paraphrase Hemingway, <strong>credit downturns happen slowly and then all at once. </strong>Don&#39;t let yourselves be surprised by a sudden increase in spreads and defaults.</p> <p>&nbsp;</p> <p>We are at a moment in time where <strong>complacency in the markets will be badly punished in accounts, bonds, and careers.</strong></p> <p>&nbsp;</p> <p><strong>People who snooze will get run over by the bear market in risk assets.</strong></p> <p>&nbsp;</p> <p>The markets have had a great run, and it is <strong>easy to get complacent </strong>after such a long period of returns.</p> </blockquote> <p>Ending with some crucial advice for everyone...&quot;<strong>Everything is liquid until you NEED to sell. Plan accordingly</strong>.&quot;</p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Everything is liquid until you NEED to sell. Plan accordingly.</p> <p>&mdash; Scott Minerd (@ScottMinerd) <a href="https://twitter.com/ScottMinerd/status/933094737787023361?ref_src=twsrc%5Etfw">November 21, 2017</a></p></blockquote> <script src="https://platform.twitter.com/widgets.js"></script><p><a href="https://www.guggenheimpartners.com/perspectives/macroeconomic-research/stocks-for-the-long-run-not-now">As Minerd concluded recently</a>, based on the historical relationship between market cap to GDP ratios and subsequent 10-year returns, today&rsquo;s market valuation suggests tha<strong>t the annual return on a broad U.S. equity portfolio over the next 10 years is likely to be very disappointing</strong>.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_minerd.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_minerd_0.jpg" style="width: 560px; height: 340px;" /></a></p> <p><strong>As such, investors may want to seek better opportunities elsewhere.</strong></p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="//players.brightcove.net/1242843969001/S1uvdXn0_default/index.html?videoId=5604622817001" width="560"></iframe></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1097" height="517" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20171123_minerd1.jpg?1511452536" /> </div> </div> </div> http://www.zerohedge.com/news/2017-11-23/guggenheim-cio-warns-everything-liquid-until-you-need-sell#comments Bond Business Economy European Central Bank Finance Financial market Financial risk Funds Investment Investor Money Senate US Federal Reserve Thu, 23 Nov 2017 18:45:00 +0000 Tyler Durden 607808 at http://www.zerohedge.com The Source Of The Next Crisis http://www.zerohedge.com/news/2017-11-23/source-next-crisis <p><a href="https://www.themacrotourist.com/posts/2017/11/23/the-next-crisis/"><em>Authored by Kevin Muir via The Macro Tourist blog,</em></a></p> <p>In 1992, the CBOE hired Robert Whaley to develop a tradeable volatility product on equity index option prices. <strong>A year later, in 1993, the VIX was born when the CBOE started publishing real-time quotes on the implied volatility of the calculated S&amp;P 500 index options.</strong> In those early days, I very much doubt Robert ever imagined his volatility index would someday be the cornerstone of some of the world&rsquo;s most actively traded ETFs.<strong> In fact, for the next decade, no VIX instruments traded at all,</strong> and it wasn&rsquo;t until 2004 that the VIX future was listed. And then, it took another five years before the first ETF based on those futures hit the exchanges.<strong> But what a ride it&rsquo;s been.</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_vix.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_vix_0.png" style="width: 600px; height: 600px;" /></a></p> <p><strong>Nowadays, <em>everyone</em> knows the VIX index</strong>. It&rsquo;s no longer some arcane index reserved for derivative traders, but instead a highly liquid, easily traded way to bet on future implied volatility. And I doubt most participants realize that last part. They are not betting on current volatility. They are not betting on future volatility. They are betting on future implied volatility. Remember that point. It&rsquo;s important. We&rsquo;ll come back to it later.</p> <p>During the 2008 Great Financial Crisis, implied volatility went through the roof.</p> <p><a class="post-sn-img-link" href="https://www.themacrotourist.com/img/posts/05/20171123-vix.png"><img class="post-sn-img" src="https://d33wubrfki0l68.cloudfront.net/c346bb4608904e06edf902096c1a925c31876ba7/3e92c/img/posts/05/20171123-vix.png" style="width: 600px; height: 444px;" /></a></p> <p>It had spiked during other crises, like Long Term Capital Management and the Asian crisis, but nothing like 2008.</p> <p><a class="post-sn-img-link" href="https://www.themacrotourist.com/img/posts/05/20170629-original.png"><img class="post-sn-img" src="https://d33wubrfki0l68.cloudfront.net/60223e834f2e91e2c1da69c91ef0f979b0e9b05e/e3e59/img/posts/05/20170629-original.png" style="width: 600px; height: 700px;" /></a></p> <p><strong>The Great Financial Crisis saw VIX explode to over 90. It was truly mind boggling. </strong>The amount of future volatility the market was pricing in was unprecedented. No one trusted anyone, the financial system was imploding, and everyone was desperate to buy insurance.</p> <p>And then, just like that, like all crises, it passed. But in the ensuing years, the panic might have been over, but it wasn&rsquo;t forgotten. And since buying VIX had been the home run trade of the last crash, investors kept going back to VIX long positions like Lindsay Lohan goes back to the bar. So even though the actual volatility of the stock market had declined to normal levels, investors kept paying too much for the insurance, betting that future volatility would once again rocket higher.</p> <p><strong>This chronic overpricing led to one of the greatest trades of the past few decades.</strong> Sure, buying VIX before the 2008 spike was profitable. But you needed to be nimble and get the timing right. After all, it wasn&rsquo;t up there for long. <em>Yet, shorting VIX - that was the trade that kept giving.</em> <strong>For the past 7 years, it has consistently been one of the most outstanding trades the financial world has ever seen.</strong></p> <p>Don&rsquo;t believe me? Look at this chart of the VXX ETF. The VXX has split countless times, so this chart reflects those splits. <strong>From 2009, when it was trading at a split adjust level of almost $120,000 per share (yup - you read that right - 120k), it is now trading at $32.</strong></p> <p><a class="post-sn-img-link" href="https://www.themacrotourist.com/img/posts/05/20171122-vxx.png"><img class="post-sn-img" src="https://d33wubrfki0l68.cloudfront.net/0600ee87170bc8caa9b9238e44a92d40529b03af/ad3e9/img/posts/05/20171122-vxx.png" style="width: 600px; height: 444px;" /></a></p> <p><strong>Just for kicks, I figured out the Sharpe Ratio of the VXX over the past year. It is -5.3! This means shorting VXX has been a consistent, and hugely profitable strategy, with surprisingly low draw-downs. </strong></p> <p>Hedge fund managers do terrible unspeakable things for Sharpe Ratios of 2.5 or 3, so finding an asset with 5+ is probably awfully demoralizing.</p> <p><strong>It&rsquo;s no wonder everyone is shorting VXX.</strong></p> <p><a class="post-sn-img-link" href="https://www.themacrotourist.com/img/posts/05/20171123-shorting.png"><img class="post-sn-img" src="https://d33wubrfki0l68.cloudfront.net/765fac86e2379e3c4aaff69bb5330fa3d47daabb/b9586/img/posts/05/20171123-shorting.png" style="width: 600px; height: 300px;" /></a></p> <p><strong>Which brings me to present day. For the longest time, I felt the concerns from the VIX were overblown. </strong></p> <p>For years, market pundits have been bandying about charts meant to scare investors about the potential dislocation in the VIX market. I even wrote a piece called, <strong><a href="http://www.themacrotourist.com/posts/2017/05/11/the-vix-article-no-one-will-like/">The VIX Article no one will like</a></strong>.</p> <p><strong>Yet the frenetic pace of VIX shorting has intensified to a level that frightens me.</strong> There is now $1.2 billion of market cap of the inverse VIX ETF XIV, with another $1.3 billion of SVXY (another inverse ETF). This is insanity. Robert Whaley never expected his little VIX product to be the epi-centre of a multi-billion dollar casino. To me, this just reeks of the old Warren Buffett quote - &ldquo;what the wise do in the beginning, the fool does in the end.&rdquo;</p> <p>I wonder how many of these short VIX investors understand the products they are buying? <strong>With VIX currently at 10, a simple move back to 20, the longer term average, would mean a doubling of the index, and if it was quick enough, could wipe out these two inverse ETFs.</strong> For example, the XIV has a provision to wind down if the NAV declines by 80%. Think about that. One missile from Little Rocket Man aimed at Guam or Hawaii, what do you think VIX trades at? My guess is that opens at 25 and gets uglier from there. Or how about a simple flash crash? It&rsquo;s not as if these markets are deep and liquid. If Central Banks step back (or heaven forbid pull out some pink tickets), it could easily cascade. Regardless, at these VIX levels, 80% moves are by no means unrealistic.</p> <p>What about the VIX futures? ETF managers use them to hedge their products, but there are also outright speculators. What&rsquo;s the margin required on these instruments? The exchange minimum is $6,200 for the front month - representing 53% of the underlying, $4,000 for the next month - which works out to 31% and the far months are $2,500 - at just 17% of the total value of the contract. Again, this is not nearly enough. And shrewd brokers that understand risk, like Interactive Brokers, are adjusting for this reality. <strong>IB has decided to require margin for a 10% overnight move in the S&amp;P 500.</strong> Harsh, but not out of the realm of possibilities. They have calculated that this would translate into a VIX level of 37. That means, IB clients need to put up more than 300% of the underlying value of the contract if they want to short VIX futures. Probably overkill, but given that few other brokers understand this risk, maybe justified.</p> <p><strong>If we get a sharp move higher in VIX, there will be snowball effect.</strong> If it is big enough, monster positions, like $2.5 billion of short VIX ETFs will have to be bought back in a hurry. And let me break it to you, there is no one large enough to take the other side of that trade. At least no one willing to do it without extracting many pounds of flesh first.</p> <p>Don&rsquo;t forget, VIX futures are the forward levels of implied volatility, not actual volatility. VIX can trade at 50 while the S&amp;P 500 index has an actual volatility of 15. There is nothing but arbitrageurs keeping this in line. Yet in a crisis, stupid shit happens all the time. How many new sellers will be there ready to takeover an upward spiraling VIX position? Let me break it to you, it&rsquo;s going to be a lot higher than the current quote.</p> <p>Now there really isn&rsquo;t anything new in my concerns. Yet another wanna-be-wise guy warning about the over popularity of the short VIX trade. Take a number and join the queue.</p> <p>But recently I was talking with <strong><a href="https://twitter.com/ErikSTownsend?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Eauthor">MacroVoices&rsquo; Erik Townsend</a></strong> about my worries. <a href="https://www.macrovoices.com/328-francesco-filia-positive-feedback-loops-threaten-systemic-risk-escalation">After letting me stumble around citing my reasoning</a>, Erik said, <strong>&ldquo;you know Kevin, it&rsquo;s actually much worse than that,&rdquo; </strong>and here is where Erik&rsquo;s deduction outshone my own,<strong><em> &ldquo;in that unwind scenario you are describing, there is a high likelihood that some market participants will find they do not have adequate margin, and will find themselves in a negative equity position.&rdquo;</em></strong> I instantly understood the brilliance of Erik&rsquo;s comment. Let&rsquo;s say VIX rises 80%, and the XIV gives notice that they are closing the fund. They have another 20% of equity to buy back their short, but what if it skids through that? What if it costs them an extra billion dollars to get their short back in? Who is on the hook? Chances are, it&rsquo;s the clearing houses.</p> <p><strong>A VIX spike is dangerous not only for everyone that is playing in the VIX square, but for all market participants.</strong> Given the size of the VIX complex, it has the potential to destabilize the entire financial system on its own. If the move is abrupt and large enough, it will not only bankrupt many different parties, but will cause a ripple effect in other markets. Not only that, but chances are that a VIX spike will be the result of some other factor that markets will need to deal with, so the threat to the clearinghouse system from a VIX debacle will only exacerbate the problem.</p> <p>Erik instantly grasped the real worry. It&rsquo;s not that a bunch of target managers will lose their fortunes that they have accumulated over the past half decade shorting VIX. <strong>No, the real worry is that they lose a whole lot more.</strong></p> <p>Erik gets it. Interactive Brokers gets it. Guys like Jesse Felder who have been warning on this for a while get it.</p> <p><strong>I finally get it. Shorting VIX, at these low levels, in the size they are doing, is not only dumb, but crazily dangerous, not only to the parties trading it, but also to the stability of the entire financial system.</strong></p> <p>I always emphasize that the next crisis won&rsquo;t look anything like the past one. And when hedge fund managers make fancy presentations of the coming collapse in high yield credit or real estate, I usually just ignore them. After all, that&rsquo;s what happened last time. It won&rsquo;t be the same. <strong><em>But how ironic would it be, if the instrument that was the hands-down winner during the last crisis (VIX), ended up causing the next crisis because too many people were short it?</em></strong></p> <p>*&nbsp; *&nbsp; *</p> <p><em>PS: As Erik outlined in the recent MacroVoices podcast, if there is a situation where short VIX players find themselves in a negative equity position, the authorities will go looking for someone to share that cost. It might not be fair, it might not be right, but there is a chance they will arbitrarily decide to take away profits from those that were long. They could do this many ways, but an easy solution would be to fix the VIX level at a lower level than where the market was trading. They would cite &ldquo;disruptive&rdquo; conditions or some other BS like that. But make no mistake, in a crisis situation, the authorities will do whatever it takes to keep the system solvent. That might include &ldquo;fixing&rdquo; the VIX. Be aware if you are trading from the long side, counting on the profits to protect your portfolio. There is simply so much risk in this VIX complex, I would be wary. And if you insist on giving it a whirl on the long side, my advice - get out before the shit really hits the fan.</em></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="735" height="464" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20171123_vix.jpg?1511451199" /> </div> </div> </div> http://www.zerohedge.com/news/2017-11-23/source-next-crisis#comments CBOE Central Banks Chicago Board Options Exchange Finance flash Guam High Yield Implied volatility Inverse exchange-traded fund Mathematical finance Money Real estate Reality S&P 500 S&P 500 Index S&P/ASX 200 VIX Stock market index Technical analysis VIX VIX Volatility Volatility Warren Buffett Thu, 23 Nov 2017 18:15:00 +0000 Tyler Durden 607807 at http://www.zerohedge.com An Equal-Opportunity Thanksgiving Day Cartoon That Can't Offend Anyone http://www.zerohedge.com/news/2017-11-23/equal-opportunity-thanksgiving-day-cartoon-cant-offend-anyone <p><strong><em>'Offend' or 'Defend'</em></strong> - take your pick... but give thanks for the freedom to choose which (for now)...</p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_tanks.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_tanks_0.jpg" width="600" height="405" /></a></p> <p><a href="https://media.townhall.com/Townhall/Car/b/bg112117dAPR20171120044534.jpg"><em>Source: Townhall.com</em></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="781" height="527" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20171123_tanks.jpg?1511450615" /> </div> </div> </div> http://www.zerohedge.com/news/2017-11-23/equal-opportunity-thanksgiving-day-cartoon-cant-offend-anyone#comments Conservatism in the United States Motion Picture Association of America film rating system Politics of the United States The Heritage Foundation Townhall Thu, 23 Nov 2017 17:45:00 +0000 Tyler Durden 607806 at http://www.zerohedge.com Gun Control Activist Wants You To Ask Your Thanksgiving Host If They Have Weapons http://www.zerohedge.com/news/2017-11-23/gun-control-activist-wants-you-ask-your-thanksgiving-host-if-they-have-weapons <p><a href="http://www.shtfplan.com/headline-news/gun-control-activist-wants-you-to-ask-your-thanksgiving-host-if-they-have-guns_11222017"><em>Authored by Mac Slavo via SHTFplan.com,</em></a></p> <p>With Thanksgiving upon us, many are planning festivities which include feasts and gatherings with friends and family.&nbsp;</p> <p><strong>But some others, like gun control activists, seek to make your holiday as miserable as possible.</strong></p> <p><strong><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_guns.jpg"><img height="252" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_guns.jpg" width="500" /></a></strong></p> <p>Shannon Watts, the founder of <a href="https://momsdemandaction.org/" target="_blank">Moms Demand Action for Gun Sense in America</a>, used the trending hashtag <a href="http://dailycaller.com/2017/11/20/gun-control-activist-ask-your-thanksgiving-host-if-they-have-guns-and-if-they-are-locked-up/" target="_blank">#ThanksgivingWeek</a> to <strong>call on parents to inquire about guns in homes where their child may be visiting this year.</strong></p> <blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="en">It&rsquo;s <a href="https://twitter.com/hashtag/ThanksgivingWeek?src=hash&amp;ref_src=twsrc%5Etfw">#ThanksgivingWeek</a>: Have you asked the friends and family your kids are visiting if there are guns in their homes and how they store them? <a href="https://t.co/pyvEUh4N3m">https://t.co/pyvEUh4N3m</a></p> <p>&mdash; Shannon Watts (@shannonrwatts) <a href="https://twitter.com/shannonrwatts/status/932640189591142400?ref_src=twsrc%5Etfw">November 20, 2017</a></p></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script><p>Watts has been fighting against gun owners for years, pushing for gun control legislation, and has encouraged businesses to adopt gun-free policies. <strong>She is also the board chair for <a href="https://www.risetorun.org/" target="_blank">Rise</a><a href="https://www.risetorun.org/" target="_blank"> to Run</a>, an organization focused on encouraging communist young women to run for office</strong>.</p> <p>But once again, proving that leftists are actually the violent ones who wish for the death of those who don&rsquo;t believe the same fantasies they do, <strong>the lemmings who follow Watts were out in full force</strong>.</p> <blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="en">Guns in Trunpist families should be stored as recklessly as possible.</p> <p>&mdash; grailsnail (@grailsnail) <a href="https://twitter.com/grailsnail/status/932573962936008705?ref_src=twsrc%5Etfw">November 20, 2017</a></p></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script><p><strong>What most leftists don&rsquo;t realize is that most gun owners don&rsquo;t care about their emotions</strong>.</p> <p>They probably will relish a Thanksgiving dinner without the political diarrhea that so many gun control activists spew.&nbsp;If I were asked the question Watts proposed, I would tell the person asking that it&rsquo;s none of their business and if they don&rsquo;t like then tough<strong>. </strong></p> <p><strong>Because the <a href="http://keepandbear.com/news/good-people-carry-firearms-gun-homicide-rates-decrease/" target="_blank">cold hard truth no liberal wants to realize</a>, is that gun control will only affect those willing to follow those laws and punishes those who have committed no crime.&nbsp;</strong></p> <p>There&rsquo;s no other way to look at it, and until the communists on the left can realize that, Thanksgiving may be more enjoyable without them.</p> <p>Personally, I think that liberals and communists have an issue with gun rights because those are the people who can tell them &ldquo;no&rdquo; and back it up.&nbsp;<em><strong> It&rsquo;s hard to control a person who&rsquo;s armed when you only bring your feelings to the fight.</strong></em></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="548" height="276" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20171123_guns.jpg?1511450080" /> </div> </div> </div> http://www.zerohedge.com/news/2017-11-23/gun-control-activist-wants-you-ask-your-thanksgiving-host-if-they-have-weapons#comments Ammunition Ballistics Coalitions Everytown for Gun Safety Firearms Gun control Gun politics in the United States None Structure Thu, 23 Nov 2017 17:19:02 +0000 Tyler Durden 607805 at http://www.zerohedge.com NFL Ratings Slump Worsens As ESPN Forced To Slash $80 Million In Salary Costs http://www.zerohedge.com/news/2017-11-23/nfl-ratings-slump-worsens-espn-forced-slash-80-million-salary-costs <p>As the NFL continues to try to address the ongoing civil war between Dallas Cowboys owner Jerry Jones and Commissioner Roger Goodell, not to mention the intermittent hostile fire from the White House, viewers are increasingly deciding they've had enough and are abandoning professional football viewership altogether.&nbsp; As the <a href="https://nypost.com/2017/11/22/the-nfl-ratings-slump-is-getting-worse/">NY Post</a> points out today, <strong>the embattled league saw ratings dip 6.3% in Week 11 meaning 1 million fewer people tuned in to see players take a knee during the national anthem versus last year.<br /></strong></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>The TV audience for NFL games steepened its slide in Week 11, losing 1 million viewers versus last year’s season-to-date average.</p> <p>&nbsp;</p> <p>The 6.3 percent slump — worsening from comparable declines of 5.6 to 5.7 percent during the previous three weeks — plagued a week whose off-the-field drama made gridiron tackling seem almost tame by comparison.</p> <p>&nbsp;</p> <p>After starting 11.8 percent behind last year’s TV audience for NFL games in Week 1, league viewership had either held its own or narrowed the gap through Week 8.</p> <p>&nbsp;</p> <p><strong>The 6.3 percent shortfall in Week 11 reflects an average viewership of 14.9 million for the NFL’s 68 national telecasts this year versus 15.9 million for the season-to-date in 2016.</strong></p> </blockquote> <p><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/11/23/2017.11.23%20-%20NFL_0.JPG" alt="NFL" width="600" height="347" /></p> <p>Meanwhile, the ratings dip, combined with massive subscriber losses (see: <a href="http://www.zerohedge.com/news/2017-11-01/espn-lost-15000-subscribers-day-october">ESPN Lost 15,000 Subscribers A Day In October</a>), has taken a huge toll on ESPN which <a href="https://sports.yahoo.com/espn-layoffs-slash-80-million-160654335.html">Yahoo News</a> reports will have to cut some $80 million in salary costs to offset their plunging top line.&nbsp; </p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>ESPN is poised to slash an estimated $80 million in salaries and other costs in coming weeks, sources tell Sporting News.</strong></p> <p>&nbsp;</p> <p>The third round of layoffs in two years at the Disney-owned sports network is expected to come down after Thanksgiving and before Christmas. Sporting News broke the news that ESPN planned to lay off up to 60 people in late November and early December. Richard Deitsch of Sports Illustrated followed up with a report that said 100 positions could be impacted.</p> <p>&nbsp;</p> <p>ESPN lost a whopping $1 billion in affiliate revenue after dropping 13 million subscribers in just six years, according to the SportsBusiness Journal. Sports insiders agree ESPN overpaid for the NFL's "Monday Night Football" ($1.9 billion annually) and the NBA ($1.4 billion a year). During 2016, ESPN's prime-time viewership fell 19 percent, according to the SBJ. Rather than driving Disney's profits, ESPN has been dragging them down, spooking Wall Street analysts.</p> <p>&nbsp;</p> <p>Meanwhile, ESPN management threw money at many anchors, analysts and reporters whose contracts were up in recent years to stop them from jumping to FS1 and other competitors. Some lost those high-paid TV gigs this spring. But ESPN is still on the hook to pay their full salaries until they get a new job elsewhere. Not many have over the past six months. Given the length of some of these expensive deals, not many will in the future, according to Awful Announcing.</p> <p>&nbsp;</p> <p><strong>"ESPN is dealing with three simple math problems. They have fewer subscribers than they planned for. They have higher costs than they planned for. They lower ratings than they hoped for,"</strong> said one source.</p> </blockquote> <p>Perhaps it's time for the NFL to admit that while most Americans can agree that professional football is really fun to watch, roughly half of them are going to disagree with whatever political stance its players decide to cram down their throats during games...so maybe best to just stick to football.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="660" height="382" alt="" src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017.11.23%20-%20NFL.JPG?1511453589" /> </div> </div> </div> http://www.zerohedge.com/news/2017-11-23/nfl-ratings-slump-worsens-espn-forced-slash-80-million-salary-costs#comments ABC Sports Bristol, Connecticut Criticism of ESPN Dallas Cowboys ESPN Fox Sports 1 Monday Night Football National Basketball Association National Football League NBCSN ratings Sports Television Television in the United States White House White House Thu, 23 Nov 2017 16:46:44 +0000 Tyler Durden 607814 at http://www.zerohedge.com How Communism Almost Prevented The First Thanksgiving http://www.zerohedge.com/news/2017-11-23/how-communism-almost-prevented-first-thanksgiving <p><a href="http://www.thedailybell.com/news-analysis/how-communism-almost-prevented-the-first-thanksgiving/">Via The Daily Bell</a></p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">When settlers first arrived at Plymouth, their first attempts to survive were disastrous.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">It sounded like a good idea. They all shared and worked for the common good. They followed the tenet, “from each according to his ability, to each according to his need,” over 150 years before Marx coined the phrase.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">Everyone was expected to work in the fields planting and harvesting, and everyone got to share the final product.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">But under these conditions life was misery. In the first year, many of the first settlers starved to death. They needed to come up with something quick, for the sake of survival. So what did they do to encourage a great boom in their tiny economy?</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">In his journal, “Of Plymouth Plantation” 1620-1647, Governor William Bradford writes about the dilemma and the solution they found.</p> <blockquote style="box-sizing: border-box; padding: 10px 20px; margin: 0px 0px 20px; font-size: 17.5px; border-left: 5px solid #eeeeee; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;"><p style="box-sizing: border-box; font-size: 16px; line-height: 24px; padding-bottom: 8px;">So they began to think how they might raise as much corn as they could, and obtain a better crop than they had done, that they might not still thus languish in misery. At length, after much debate of things, the Governor (with the advice of the chiefest amongst them) gave way that they should set corn every man for his own particular, and in that regard trust to themselves.</p> </blockquote> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">They abandoned the supposedly utopian system of communal sharing and decided that people were now responsible for their own survival. The land was portioned among families based on their numbers, and anyone who did not have a family in Plymouth was assigned to a household.</p> <blockquote style="box-sizing: border-box; padding: 10px 20px; margin: 0px 0px 20px; font-size: 17.5px; border-left: 5px solid #eeeeee; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;"><p style="box-sizing: border-box; font-size: 16px; line-height: 24px; padding-bottom: 8px;">This had very good success, for it made all hands very industrious, so as much more corn was planted than otherwise would have been by any means the Governor or any other could use, and saved him a great deal of trouble, and gave far better content. The women now went willingly into the field, and took their little ones with them to set corn; which before would allege weakness and inability; whom to have compelled would have been thought great tyranny and oppression.</p> </blockquote> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">What happened was simple. Now people knew that their survival, and that of their family, relied entirely on their own production. They knew that whatever excess they grew or manufactured would benefit them rather than being given to someone who hadn’t worked as hard. This got more people into the fields to work. And of course, the excess production still benefited the whole of the colony. People could now specialize and trade, meaning more wealth for everyone. Now it paid to innovate.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">No one was going to force women and children into the fields before. That would have been tyrannical. But now, worrying for the survival of her family, a mother would take her children into the fields with her to work.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">In his journal Bradford discusses what happened when the settlement shifted to every-man-for-himself. He laments the “vanity and conceit” of Plato and other philosophers’ claim:</p> <blockquote style="box-sizing: border-box; padding: 10px 20px; margin: 0px 0px 20px; font-size: 17.5px; border-left: 5px solid #eeeeee; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;"><p style="box-sizing: border-box; font-size: 16px; line-height: 24px; padding-bottom: 8px;">…that the taking away of property and bringing in community into a commonwealth would make them happy and flourishing; as if they were wiser than God. For this community (so far as it was) was found to breed much confusion and discontent and retard much employment that would have been to their benefit and comfort.</p> </blockquote> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">When you get to keep what you work for, people work harder, and produce more. When people produce more than they can consume, this benefits others in the society who get to trade for the extra goods. This type of situation also leads to specialization in a particular field.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">If someone produces extra food, he can then trade it. Then if someone else produces extra cloth, she can trade that. People who are good at something, can market that skill in exchange for something which they are not good at producing. When they have something to gain from extra cloth and food, they will work harder to produce more in order to trade the excess. Again, this benefits everyone, as there are now more goods available—overall production has increased because there is more to be gained from working hard.</p> <blockquote style="box-sizing: border-box; padding: 10px 20px; margin: 0px 0px 20px; font-size: 17.5px; border-left: 5px solid #eeeeee; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;"><p style="box-sizing: border-box; font-size: 16px; line-height: 24px; padding-bottom: 8px;">For the young men, that were most able and fit for labour and service, did repine that they should spend their time and strength to work for other men’s wives and children without any recompense. The strong, or man of parts, had no more in division of victuals and clothes than he that was weak and not able to do a quarter the other could; this was thought injustice.</p> </blockquote> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">And rightfully so. Why should one person spend their time working to support others for no reward? When he is rewarded for his effort, it is justified that he works for “other men’s wives.” And as the pilgrims found out, this actually puts him in a better position to support others.</p> <blockquote style="box-sizing: border-box; padding: 10px 20px; margin: 0px 0px 20px; font-size: 17.5px; border-left: 5px solid #eeeeee; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;"><p style="box-sizing: border-box; font-size: 16px; line-height: 24px; padding-bottom: 8px;">And for men’s wives to be commanded to do service for other men, as dressing their meat, washing their clothes, etc., they deemed it a kind of slavery, neither could many husbands well brook it.</p> </blockquote> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">Instead of being compelled to wash others’ clothes and dress others’ meat, it was now done in exchange for another good or service. They moved on from “slavery” to mutually beneficial transactions. Bradford adds that such was the experience of good standing, God fearing men, “And would have been worse if they had been men of another condition.”</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">This provides us a perfect microcosm of society to study. In isolation, the principles of economics were obvious. On such a small scale it is easier to see that when you consume something you have not produced, you are taking that away from the producer. When society is set up to allow those conditions, there is less produced. When people are allowed to keep the products of their labor, more is produced, and all of society benefits. This also encourages innovation to create excess goods, which can be traded for the benefit of the producer, while also benefitting the other trader.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">The plantation started with a&nbsp;restrictive economy. People were compelled to work, yet this requirement did not produce enough for every to live. They thought it was an unjust society, they lamented having to work for “others’ wives” or wives having to work for other men. Morale was down, and production was down, since there was no benefit to working harder. People starved to death, because of the lack of necessities grown and produced.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">If they hadn’t realized their mistake and turned things around, they would never have produced enough to hold the first Thanksgiving. Only a free market allowed the conditions to give thanks for how much they produced.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">The pilgrims were thankful that they had solved the problems of starvation. No one felt enslaved, instead they felt empowered. They could go as far as their brain and hard work would take them. The quality of life advanced for everyone because of the seemingly selfish doctrine that each person keeps what they produce.&nbsp; And even the people in Plymouth who could not support themselves benefited because now there were enough excess goods to go around.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif;">This Thanksgiving we can be thankful that Plymouth Plantation set the tone for individual freedom. They tried an experiment in government, and it paid off.</p> <p>&nbsp;</p> <div class="awac-wrapper" style="box-sizing: border-box; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif; font-size: 16px;"> <div class="awac widget text-10" style="box-sizing: border-box;"></div> </div> <p>&nbsp;</p> <p style="box-sizing: border-box; margin: 0px 0px 10px; font-size: 16px; line-height: 24px; padding-bottom: 8px; color: #303030; font-family: Georgia, &quot;Times New Roman&quot;, Times, serif; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; background-color: #ffffff; text-decoration-style: initial; text-decoration-color: initial;">Be thankful for freedom.</p> http://www.zerohedge.com/news/2017-11-23/how-communism-almost-prevented-first-thanksgiving#comments English separatists ETC Geography of England Local government in England Plymouth Plymouth Colony Plymouth, Massachusetts South West England Squanto Wampanoag people William Bradford Thu, 23 Nov 2017 16:20:21 +0000 TDB 607812 at http://www.zerohedge.com The Mother Of All Irrational Exuberance http://www.zerohedge.com/news/2017-11-23/mother-all-irrational-exuberance <p><a href="http://davidstockmanscontracorner.com/the-mother-of-all-irrational-exuberance/"><em>Authored by David Stockman via Contra Corner blog,</em></a></p> <p><strong>You could almost understand the irrational exuberance of 1999-2000. </strong>That&#39;s because everything was seemingly coming up roses, meaning that cap rates arguably&nbsp;had rational&nbsp;room to rise.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_irrational.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_irrational_0.jpg" style="width: 600px; height: 433px;" /></a></p> <p><strong>But eventually the mania lost all touch with reality;</strong> it succumbed to an&nbsp;upwelling of madness that at length&nbsp;made even Alan Greenspan look like a complete fool, as we document below.</p> <p>So doing, the great tech bubble and crash of 2000 marked a crucial turning point in modern financial history:<em><strong>&nbsp;It reflected the fact&nbsp;that the normal mechanisms of honest price discovery in the stock market had been disabled&nbsp;by heavy-handed central bankers and that the&nbsp;natural&nbsp;balancing and disciplining mechanisms of two-way markets had been destroyed.</strong></em></p> <p><strong>Accordingly, the stock market had become a ward of the central bank and a casino-like gambling house, which could no longer self-correct. </strong>Now it would relentlessly&nbsp;rise on pure speculative momentum---- until it reached an asymptotic top, and would then collapse in a fiery crash on&nbsp;its own weight.</p> <p>That&#39;s what subsequently happened in April 2000 when the hottest precincts of the stock market---the NASDAQ 100 stocks----began a perilous <em><strong>80%</strong></em> dive; and it&#39;s also what happened in the broader markets-----including the S&amp;P 500---in 2008-2009, when a thundering <strong>60%</strong> plunge unfolded in a hardly a year&#39;s time.</p> <p><u><strong>So with the market raging in self-fueling momentum at the 2600 mark on the S&amp;P 500, we&nbsp;reflect back to the great dotcom crash for vivid reminders of what happens next. </strong></u>That earlier meltdown is&nbsp;especially pertinent because in many ways today&#39;s stock market mania is far less justified than the one back then.</p> <p>Moreover, the dotcom version was also the first great central bank fueled bubble of modern times---a creature that market participants understandably did not&nbsp;fully grasp. Yet to its everlasting blame, the Fed&#39;s subsequent&nbsp;experiments in reflationary bailouts of the casino&nbsp;gamblers has only&nbsp;caused Wall Street&#39;s muscle memory to atrophy further.</p> <p><strong>Indeed, after 30 years of Greenspan-style Bubble Finance and two devastating crashes, Wall Street is even more&nbsp;credulous today than it was on the eve of the tech crash. Back then, in fact, there was a considerable phalanx of Wall Street old-timers who warned about the dotcom insanity. Now almost&nbsp;no one sees this one coming.</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171122_EOD6.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171122_EOD6_0.png" style="width: 600px; height: 315px;" /></a></p> <p>&nbsp;</p> <p><strong>Indeed, today&#39;s nutty forecast by Goldman Sachs that the S&amp;P 500 will hit <em>3,100 </em>by the end of 2020 makes Greenspan&#39;s earlier bubble blindness look clairvoyant by comparison.</strong></p> <p>In hindsight, Alan Greenspan did see it coming early on---&nbsp;when he broached the &quot;irrational exuberance&quot;&nbsp;topic in passing during a speech in&nbsp;December 1996.&nbsp;Unfortunately, he has mostly been dinged for being allegedly way too&nbsp;early in making the call.</p> <p>In fact, we don&#39;t think he was making much of a call at all---he&#39;s was just musing out&nbsp;loud with no intention of reining-in the then rampaging bull. What he actually did was to&nbsp;conduct several gumming fests at subsequent Fed meetings and then diffidently&nbsp;raised interest rates a single time by a pinprick 25 basis point in April&nbsp;1997.</p> <p>After that the Maestro (so-called)&nbsp;apparently&nbsp;forgot all about &quot;irrational exuberance&quot; even as that very thing soon began&nbsp;infecting the entire warp and woof of the financial system.</p> <p>In fact, Greenspan&#39;s&nbsp;fatuous amnesia became so&nbsp;pronounced that&nbsp;by the very&nbsp;eve of the&nbsp;dotcom&nbsp;crash in April 2000,&nbsp;he&nbsp;proved himself blind as a bat when it comes to central bank created bubbles.</p> <p>Said the Maestro to a Senate committee on April 8&nbsp;when asked whether an interest rate increase might prick the stock market bubble:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em><strong>That presupposes I know there is a bubble....I don&#39;t think we can know there is a bubble until after the fact. To assume we know it currently presupposes we have the capacity to forecast an imminent decline in (stock) prices&quot;.</strong></em></p> </blockquote> <p>At least he got the latter part right.&nbsp;After the NASDAQ had&nbsp;risen from <strong>835</strong> in December 1996 to <strong>4585</strong> on March 28, 2000---or to an out-of-this-world <em><strong>5.5X</strong> </em>gain in 40 months----Greenspan wasn&#39;t even&nbsp;sure he was seeing a bubble!</p> <p>Accordingly, he apparently didn&#39;t have that capacity to predict an imminent decline---although the <em><strong>51%</strong></em>&nbsp;crash to <strong>2250</strong> by the&nbsp;end of the year&nbsp;would seem to have been&nbsp;exactly that.</p> <p>Indeed, after&nbsp;unloading the above tommyrot at the tippy-top of the NASDAQ-100 bubble,&nbsp;Greenspan proved himself a&nbsp;clueless, pitiable fool when this giant bubble deflated by<strong> 81%</strong> over the next two years.</p> <p>In fact, the index ended up in September 2002 almost exactly where it had been when Greenspan spoke the words &quot;irrational exuberance&quot; and then moved along with the Fed&#39;s printing press at full speed---claiming&nbsp;there was nothing to see.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_irrational1.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_irrational1_0.jpg" style="width: 600px; height: 316px;" /></a></p> <p>Still,&nbsp;back then you&nbsp;could almost have made&nbsp;a&nbsp;(lame)&nbsp;excuse for the Fed chairman&#39;s bubble blindness. The Maestro&nbsp;was operating&nbsp;in the early days of monetary central planning and wealth effects management, and its potent capacity to unleash rampant speculation in the financial system was not yet fully understood----even if the underlying monetary theory defied all the canons of sound finance.</p> <p><strong>Moreover, in addition to rampant bubbles in the financial market,&nbsp;the Fed&#39;s money pumping during the 1990s did also seem to be producing some seemingly robust real world effects on main street and in&nbsp;the booming new tech part of the economy.</strong></p> <p>And, in turn, these positive macroeconomic developments were unfolding in a global political/strategic environment that had suddenly become more benign that at any time since June 1914.</p> <p>Indeed,&nbsp;the outside world fairly buzzed with positive developments. These included the fact that the&nbsp;internet/tech revolution still&nbsp;exuded adolescent vigor, the government&#39;s fiscal accounts were nearing balance for the first time in two decades, the vast&nbsp;market&nbsp;of China was convincingly rising from its Maoist slumber and&nbsp;the Committee To Save the World (Greenspan,&nbsp;Summers and Rubin) had just rescued&nbsp;Wall Street with alacrity&nbsp;from the Long-Term Capital&nbsp;Management (LTCM)&nbsp;meltdown.</p> <p><strong>Likewise, Europe was&nbsp;launching the single currency and expanding&nbsp;the single market. In place of the Soviet Union,&nbsp;which had disappeared&nbsp;from the pages of history in 1991, Russia, its breakaway republics and the former Warsaw&nbsp;Pact (captive) nations were all bursting out of their statist chains and experimenting with home&nbsp;grown capitalism and reaching out to the west via rising&nbsp;trade and capital flows.</strong></p> <p>In the US, the combination of the end of the cold war and the internet revolution contributed a doubly whammy to growth and prosperity. When defense spending fell from<strong> 7%</strong> of GDP&nbsp;on the eve of the Soviet collapse to under <em><strong>4%</strong></em> by the year 2000, substantial domestic resources were released for private investment and a resulting substantial productivity uplift.</p> <p>In fact,&nbsp;real private&nbsp;nonresidential investment grew at<strong>&nbsp;7.3%</strong> per&nbsp;year from&nbsp;the&nbsp;1990 pre-recession peak&nbsp;through 2000. That&nbsp;was more than double the still respectable&nbsp;<em><strong>3.4%</strong></em> rate recorded between 1967 and 1990; and causes&nbsp;the anemic <em><strong>1.4%</strong></em> real growth of fixed investment&nbsp;between the pre-crisis peak&nbsp;(2007)&nbsp;and 2016 to pale into insignificance.</p> <p><img class="alignnone size-medium" src="https://fred.stlouisfed.org/graph/fredgraph.png?g=fOFb" style="width: 599px; height: 241px;" /></p> <p><strong>Notwithstanding all of these positives, however, the great bull stock market of the late 1990s ended-up getting way ahead of itself. </strong>That was especially the case during the next&nbsp;18&nbsp;months&nbsp;after the Fed&#39;s&nbsp;heavy-handed and somewhat panicked bailout of LTCM in September 1998 had&nbsp;confirmed to the newly energized casino gamblers&nbsp;that the Greenspan Put was most definitely operative.</p> <p>In the<em><strong> Great Deformation</strong> </em>we tracked&nbsp;12 of the highest-flying big cap stocks&nbsp;(&quot;Delirious Dozen&quot;)&nbsp;during the period between Greenspan&#39;s December 1996 speech and the April 2000 dotcom bust. During this <strong>40-month&nbsp;</strong>period, the combined&nbsp;market cap of these 12 leading&nbsp;momo stocks---including Microsoft, Cisco, Dell, Intel, Juniper Networks, Lucent, AIG, GE&nbsp; and four others---soared from&nbsp;<em><strong>$600 billion</strong> </em>to <strong>$3.8 trillion</strong>.</p> <p>That eruption&nbsp;did indeed give the notion of trees which grow to the sky an altogether new definition. To wit, the total market cap of the Delirious Dozen grew by <em><strong>75% per annum</strong> </em>for nearly 4 years running; and the future outlook was claimed to be&nbsp;even more fantastic.</p> <p>For instance,&nbsp;as of mid-2000&nbsp;Intel was valued at <strong>$500 billion</strong> and traded at <strong>53X</strong> its<strong> $9.4 billion</strong> of LTM earnings. Yet it was argued that this nosebleed multiple was&nbsp;more than warranted because the&nbsp;company had grown its net income from $1 billion to $9.4 billion during the previous decade, and that there was nothing but blue sky ahead.</p> <p>Here&#39;s the thing, however. Intel was and is a great company that, in fact, has never stopped growing.</p> <p>But during the 17 years since mid-2000, its net income growth rate&nbsp;has sharply slowed to just<strong>&nbsp;1.79%</strong> per annum; and its&nbsp;<strong>$12.7 billion</strong> of LTM&nbsp;net income for September 2017 is valued at only <strong>15.7X&nbsp;</strong>or <strong>$210 billion</strong>.</p> <p>In short, at the peak of the tech bubble Intel&#39;s market cap had vastly&nbsp;outrun its long run-earnings capacity. Even&nbsp;today it has only earned back&nbsp;<strong>40%</strong> of its bubble peak valuation.</p> <p>Likewise, Cisco was valued at <em><strong>$500 billion</strong> </em>in July 200&nbsp;and sported a <em><strong>185</strong></em>X PE multiple on its <em><strong>$2.7 billion</strong> </em>of LTM net income.&nbsp;And it, too, has continued to grow, posting LTM net income of <em><strong>$9.7 billion</strong> </em>for September 2017.</p> <p>Yet&nbsp;today&#39;s earnings are accorded only a <strong>19X</strong> multiple after 17 years of <strong>2.4%</strong> per annum growth; Cisco&#39;s current $181 billion market cap, in fact,&nbsp;sits at&nbsp;just <strong>36%</strong> of its bubble peak.</p> <p>Even the mighty Mr. Softie has experienced pretty much the same fate. Back in mid-2000, it posted <em><strong>$8.3 billion</strong> </em>of LTM&nbsp;net income and was valued at <strong>$600 billion</strong> or <strong>72X</strong>. Today its net income has<strong> tripled</strong> to <strong>$23.1 billion</strong>, but its PE multiple has receded to just <strong>29X.</strong></p> <p>Stated differently, Microsoft&#39;s net income has grown at<strong> 6.1%</strong> per annum since&nbsp;the company&nbsp;vastly outran it true value back&nbsp;in early 2000. Accordingly,&nbsp;its market cap gained just <em><strong>0.4%</strong> </em>per annum during the last 17 years. That is, it has taken&nbsp;one of the greatest&nbsp;tech companies of all&nbsp;time upwards of&nbsp;two decades<em>&nbsp;</em>to earn back its peak dotcom era&nbsp;bubble valuation.</p> <p>And when it comes to the industrial and financial conglomerate&nbsp;empire that Jack (Welch) built, the story is even more dramatic.&nbsp;GE&#39;s mid-2000 market cap of <strong>$500 billion</strong> stands at just <strong>$155 billion</strong> today; and its PE multiple of<strong>&nbsp;60X</strong> has shrunk to just <strong>22X.</strong></p> <p><strong>In short, that&nbsp;was irrational exuberance back then, and it did not take long for the vast quantities of bottled air in the market cap of the Delirious Dozen to come rushing out. By the bottom in September 2002, four of these companies had vanished into bankruptcy and the market cap of the survivors had imploded to just $1.1 trillion.</strong></p> <p>That&#39;s a fact and you can look it up in the papers. In&nbsp;less than 30 months, <strong>$2.7 trillion</strong> of market cap had&nbsp;literally ionized.&nbsp; And these were the leading companies of the era.</p> <p>None of them, it might be noted, were valued at <strong>280X</strong> shrinking net income, as is Amazon today; or at infinite PE multiples like much of the biotech sector and momo hobby horses like Tesla.</p> <p>More importantly, the promising&nbsp;macro-economic&nbsp;situation at the turn of the century&nbsp;has given way to a world precariously balanced&nbsp;on <strong>$225 trillion</strong> of debt and the tottering&nbsp;<strong>$40 trillion</strong> Red Ponzi of China.</p> <p><strong>Likewise, the benign&nbsp;geo-strategic environment of that era has long since disappeared into the madness of RussiaGate, endless wars in the middle east and Africa and the incendiary confrontation between the Fat Boy and the Donald&nbsp;on the Korean peninsula.</strong></p> <p>Finally, after 30 years of rampant&nbsp;monetary expansion&nbsp;the central banks of the world have been forced to reverse direction and begin to normalize interest rates and balance sheets.</p> <p>And that now incepting and&nbsp;unprecedented experiment in massive demonetization of public debts is coming at a time when----after 8 years of business cycle expansion---the US, Japan and most of Europe are running monumental &quot;full-employment&quot; budget deficits.</p> <p><strong>Even then, these&nbsp;reckless fiscal&nbsp;policies are happening&nbsp;in the teeth of a demographically driven tsunami of pension, medical and welfare spending.</strong></p> <p>For the period just ended, the S&amp;P 500 companies earned <strong>$107</strong> per share on an LTM basis---or just <strong>2%</strong> more than the <em><strong>$105</strong> </em>per share posted back in September 2014; and also only modestly&nbsp;more than the <strong>$85</strong> per share recorded&nbsp;way back at the&nbsp;June 2007 pre-crisis peak.</p> <p>Stated differently, on a trend basis S&amp;P 500 companies have grown their earnings at <em><strong>2.33%</strong></em> per annum over the last decade.&nbsp;How that merits a <em><strong>24.3X</strong> </em>PE multiple on today&#39;s<em><strong> 2600</strong> </em>index&nbsp;price is hard to fathom---let alone Goldman&#39;s<strong> 3100</strong> target for 2020.</p> <p>Indeed,&nbsp;just to retain today&#39;s absurd PE multiple would require&nbsp;<strong>$130 per</strong> share of GAAP earnings by 2020 at the Goldman target price.</p> <p><strong>That&#39;s right.&nbsp;By the end of&nbsp;2020 we would be implicitly in the longest business expansion in recorded history at 140&nbsp;months (compared to 118 months in the 1990s),</strong></p> <p>Furthermore, the&nbsp;term structure of interest rates will be 200-300 basis points higher according to the Fed&#39;s current policies, while&nbsp;the US treasury&nbsp;will be running $1 trillion plus annual deficits and&nbsp;experiencing recurring debt ceiling and financial crises.</p> <p>Even then you would need<strong> 7%</strong> annual earnings growth to hold onto today&#39;s <strong>24.2X</strong> PE multiple at the Goldman S&amp;P 500 target.</p> <p><strong>As we said,&nbsp;relative to today&#39;s casino madness and the&nbsp;Goldman fairy tale hockey stick, Alan Greenspan circa April 2000&nbsp;looks like&nbsp;a model of sobriety by comparison.</strong></p> <p>So&nbsp;if that was Irrational Exuberance back in April 2000, <strong><em>what we have now is surely the mother thereof.</em></strong></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="892" height="643" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20171123_irrational.jpg?1511446472" /> </div> </div> </div> http://www.zerohedge.com/news/2017-11-23/mother-all-irrational-exuberance#comments AIG Alan Greenspan Alan Greenspan Business Central Banks China Debt Ceiling Dell Dot-com bubble Economic bubbles Economy Finance fixed GAAP Gambling goldman sachs Goldman Sachs Goldman Sachs Greenspan put Irrational Exuberance Irrational exuberance Japan Main Street Meltdown Middle East Momo Money NASDAQ Nasdaq 100 NASDAQ 100 None PE Multiple Real estate bubble Reality S&P 500 Senate committee Stock market United States housing bubble US Federal Reserve Thu, 23 Nov 2017 16:15:11 +0000 Tyler Durden 607802 at http://www.zerohedge.com 28 Reasons to Buy Physical Gold http://www.zerohedge.com/news/2017-11-23/28-reasons-buy-physical-gold <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><span style="font-size:16px;"><em><strong>Submitted by <a href="http://www.bullionstar.com">BullionStar.com</a></strong></em></span></p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Throughout human history, gold has constantly emerged as an unparalleled&nbsp;form of savings, investment and wealth preservation. Due to its&nbsp;unique characteristics and features, gold has inherent value and cannot be debased. When holding physical gold, there is no counterparty risk or default risk.&nbsp;Wealth in the form of gold can also be held and stored anonymously.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">From its&nbsp;ability to retain its purchasing power over time, to its safe haven status in times of financial turmoil, to gold&#39;s ability to diversify investment risk, there&nbsp;are many and varied reasons to own physical gold in the form of investment grade gold bars and gold coins.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">1. Tangible with Inherent Value</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Physical gold is real and tangible. It is indestructible, impossible to create artificially, and difficult to counterfeit. Mining physical gold is arduous and costly. Physical gold therefore has inherent value and worth. In contrast, paper money doesn&#39;t have any inherent value.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">2. No Counterparty Risk</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Physical gold has no counterparty risk. When you hold and own gold bars and gold coins outright, there is no counterparty.&nbsp;In contrast, paper gold (gold futures, gold certificates, gold-backed ETFs) all involve counterparty risk.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);"><strong style="box-sizing: border-box;">3. Scarcity</strong></h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold deposits are relatively scarce across the world and difficult to mine and extract. New supply of physical gold is therefore limited and explains why gold is a precious metal. Gold&#39;s scarcity reinforces it&#39;s inherent value.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">4. Cannot be Debased</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Because of its physical characteristics and features, gold cannot be debased, and gold supply is immune to political meddling. Compare this to fiat money supplies which are constantly being debased and destroyed via deficit government spending, central bank quantitative easing and financial system bailouts. On a survivorship scale, gold has far outlived all fiat currencies by thousands of years.</p> <h3 style="margin-top: 22px; margin-bottom: 22px; font-size: 18px; box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; color: rgb(48, 48, 48);">5. Store of Value</h3> <p style="margin-top: 0px; margin-bottom: 24px; box-sizing: border-box; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold is a preeminent store of value. Physical gold, in the form of gold bars or gold coins, retains its purchasing power over long periods of time despite general increases in the price of goods and services.</p> <p style="margin-top: 0px; margin-bottom: 24px; box-sizing: border-box; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">In contrast, fiat currencies such as the US Dollar are not stores of value and their purchasing power consistently becomes eroded by inflation or the general increase in the price level. Fiat currencies have a long history of either becoming totally worthless and going out of circulation, or else becoming completely debased, such as the US dollar, while remaining in circulation.</p> <p style="margin-top: 0px; margin-bottom: 24px; box-sizing: border-box; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Since the creation of the US Federal Reserve in 1913, the US dollar has lost over 98% of its value relative to gold, i.e. the US dollar has lost over 98% of its purchasing power relative to gold.</p> <p style="margin-top: 0px; margin-bottom: 24px; box-sizing: border-box; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user227218/imageroot/2017/11/23/Fed%20and%20gold.png" style="width: 677px; height: 387px;" /></p> <p style="margin-top: 0px; margin-bottom: 24px; box-sizing: border-box; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><span style="font-size:14px;"><strong style="box-sizing: border-box; color: rgb(34, 14, 16); font-style: italic;">Since 1913, the US Dollar has lost more than 98% of its value, while gold has retained its value.</strong></span></p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">6. Long- Term Inflation Hedge</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Physical gold&rsquo;s ability to retain its purchasing power over time is sometimes referred to as the &ldquo;Golden Constant&rdquo;. This reflects the fact that gold&rsquo;s purchasing power is constant over long periods of time. This &lsquo;constant&rsquo; exists because the gold price adjusts to changes in inflation and future inflation expectations.&nbsp;Therefore, physical gold is a long-term hedge against inflation.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">7. A 6000 Year History</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold has played a central role in society for thousands of years from the early civilizations of ancient Egypt, right up to the contemporary era. Gold has facilitated international trade throughout history, has been directly responsible for the economic expansion and prosperity of numerous civilizations throughout history, and has even been, due to gold exploration and mining, the direct catalyst for the growth of some of today&rsquo;s best-known cities such as San Francisco, Johannesburg, and Sydney.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">8. A 2500 Year Track Record as Money</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Because of its ability to retain value and act as a store of value, physical gold has been used as money for over 2500 years.&nbsp;Gold coins were first issued in the Lydian civilization in what is now modern Turkey. Subsequently gold was used as a stable form of money in Persia, ancient Greece, ancient Rome, the Spanish and Portuguese Empires, the British Empire, and right through to the various international gold standards of the 20<span style="box-sizing: border-box; font-size: 9px; line-height: 0; position: relative; top: -0.5em;">th</span>&nbsp;century.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">It was only in August 1971 that the US famously suspended the convertibility of the US dollar into gold, a move which triggered the debt fueled expansion that is still having repercussions within today&rsquo;s monetary system.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">To put gold&rsquo;s monetary importance into perspective, for 97% of the last 2500 years, gold has been chosen by numerous sophisticated civilizations as the form of money par excellence and an anchor of stability, precisely because of its ability to retain its value.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">9. Safe Haven</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Physical gold acts as a safe haven asset in times of conflict, war and geopolitical turmoil. During the financial market stresses and heightened uncertainties caused by wars, conflicts and turmoil, the counterparty risk of most financial assets spikes. But since physical gold does not have any counterparty risk, investors rush to gold during these periods so as to preserve their wealth. This is analogous to sheltering in a safe harbor. Gold can thus be seen as a form of financial insurance against catastrophe.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">10. Portable Anonymous Wealth</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><a href="https://www.bullionstar.com/buy/gold-bars" style="box-sizing: border-box; color: rgb(170, 99, 39); text-decoration-line: underline;">Gold bars</a>&nbsp;and&nbsp;<a href="https://www.bullionstar.com/buy/gold-coins" style="box-sizing: border-box; color: rgb(170, 99, 39); text-decoration-line: underline;">gold coins</a>&nbsp;combine high value with high portability. In times of conflict and war, gold bars and gold coins are ideal for transporting wealth and savings across borders and within conflict zones in an anonymous fashion.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">11. Universal Acceptance</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold is universally accepted as money across the world, with the highly liquid global market always providing ample sales opportunities for gold bars and gold coins. This means that whichever city you are in across the world, you can always sell or trade your gold bars and gold coins.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">12. Emergency Money</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Military personnel are often issued with gold coins that they carry with them in conflicts zones as a form of emergency universal money. For example, the British Ministry of Defense often issues RAF pilots and SAS soldiers with Gold Sovereign coins to carry on their persons during combat missions and activities, such as in the Middle East.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user227218/imageroot/2017/11/23/gold%20versus%20paper2.jpg" style="width: 500px; height: 500px;" /></p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><strong style="box-sizing: border-box; color: rgb(34, 14, 16); font-style: italic;">Worthless paper Currencies vs the Inherent Value of&nbsp;<a href="https://www.bullionstar.com/buy/gold" style="box-sizing: border-box; color: rgb(170, 99, 39); text-decoration-line: underline;">Owning Physical Gold</a></strong></p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">13. Outside the Banking System</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">In the current era of global financial repression, physical gold is one of the few assets outside the financial system. Gold is not issued by any monetary authority or central bank or government. Because its not issued by any government or central bank, gold is independent of the banking system. Fully owned physical gold, if stored in a non-bank vault or held in one&rsquo;s possession, is outside the banking system.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">14. No Default Risk</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Unlike a government bond, there is also no default risk with gold because it is not issued by any authority that could default. Gold bars and gold coins are no one else&rsquo;s liability. Physical gold cannot go bankrupt or become insolvent. Therefore, there is no need to have to trust any other party when holding physical gold.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">15. Portfolio Diversification</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Adding an investment in gold to an existing portfolio of other investment assets such as stocks and bonds, reduces the volatility (risk) of the investment portfolio and can increase portfolio returns. This is because the gold price has a low to negative correlation with the prices of most other financial assets, because gold is less influenced by business cycles and macro-economic cycles than most other assets.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Numerous empirical studies by financial academics, as well as industry bodies, such as the World Gold Council, have validated gold&rsquo;s role as a strategic portfolio diversifier. Optimal allocations to gold in multi-asset portfolios have found to be in the 5% to 10% range.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">16. Currency Hedge</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">There is generally an inverse relationship between the gold price and the US dollar, in that the gold&nbsp;price generally moves in opposite directions to the US dollar. Therefore, holding gold can act as a currency hedge of the US dollar, and help manage the currency risk of portfolios denominated in US dollars.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">17. Gold&#39;s Metallic Properties</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold has many and varied metallic properties. These properties provide gold with many technological and commercial applications and uses, which in turn contribute as additional demand drivers in addition to the investment and monetary demand for gold.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold is highly ductile (can be drawn into very thin wire). It is also highly malleable (can be hammered and flattened into very thin film). Gold is a very good conductor of electricity and heat. Gold does not corrode or tarnish. It is chemically unreactive and non-toxic to the human body. Gold has a high luster and shine, and an attractive yellow glow.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">These properties explain gold&rsquo;s use in electrical and electronic wiring and circuits (e.g. computers and internet switches), its use in the medical and dental fields, gold&rsquo;s use in solar panels, space travel, and gold&rsquo;s traditional uses in jewelry, decoration, and ornamentation. With new technological uses being found for gold all the time, gold&#39;s demand pattern is diversified and underpinned by its commercial importance.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">18. Physical gold - A tiny fraction of Paper Gold</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">The London wholesale gold market and the US-based COMEX gold futures market generate huge trading volumes of paper gold that dwarf the size of the physical gold market. However, these markets only trade derivatives on gold (futures and unallocated positions), representing fractionally-backed and unbacked claims on gold that could never be convertible into physical gold by claim holders.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">In a scenario under which these paper gold markets became unsustainable, the prices of paper gold and physical gold would diverge, with the paper gold markets ceasing to trade and collapsing, and only physical gold retaining any real value. Physical gold is therefore an insurance against the collapse of the world&#39;s vast paper gold markets.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">19. By Definition - Not an ETF</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Physical gold Provides all the benefits that gold-backed Exchange Traded Funds (ETFs) do not. ETFs provide exposure to the gold price, not to gold. Holding physical gold is by definition direct exposure to gold. With most gold-backed ETFs, you cannot convert the units into gold and take delivery of the gold, and in many cases, the locations of the vaults are not even known. If holding physical allocated gold bars or gold coins in a vault, such as with BullionStar in Singapore, you can always take delivery.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold ETFs have many counterparty risks since there are many moving parts in an ETF such as a trustee, a custodian, and a sponsor / issuer.&nbsp;Physical gold has no counterparty risks. When you hold a gold-backed ETF, the quantity of gold backing the ETF declines over time due to management fees being offset against the gold holdings. When you hold physical gold, you always remain with 100% of the actual gold you first purchased. There is no erosion of holdings.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">20. Anonymous Storage</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold can be stored anonymously, either in your possession within your house or property, or in a vault in a jurisdiction, such as Singapore, that has no reporting requirements. Since gold has a high value to weight ratio, storing gold does not take up much space.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">21. Independent of Internet</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Owning physical gold is not reliant on having internet access and access to electronic wallets and cryptocurrency exchanges. Furthermore, gold cannot be stolen by hacking an electronic address or by transferring or deleting a number in a computer.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user227218/imageroot/2017/11/23/collage-gold-coins-and-bars2.jpg" style="width: 679px; height: 453px;" /></p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><strong style="box-sizing: border-box; color: rgb(34, 14, 16); font-style: italic;">Owning Gold Coins and Gold Bars Provides Many and Varied Benefits</strong></p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">22. Real Gold is Measured by Weight</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Physical gold is measured in weight, not through a number set by a politician or central banker. When you buy a 1 Kilo gold bar, or a 10 Tola gold bar, or a 1 troy ounce gold coin, or a 5 Tael gold bar, you will always have that gold bar or gold coin, irrespective of the fluctuations of fiat currencies.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">While thinking of the value of physical gold in terms of a fiat currency might be convenient, a better way is to think of a gold holding in terms of weight.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">23. Coins and Bars - Build a Collection</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Buying investment gold bars and bullion gold coins allows you to build a diverse collection of bars and coins that are at the same time a fascinating pastime and a form of investment and saving.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><a href="https://www.bullionstar.com/buy/gold-coins" style="box-sizing: border-box; color: rgb(170, 99, 39); text-decoration-line: underline;">Bullion gold coins</a>&nbsp;from the world&rsquo;s major mints are beautifully illustrated and often have a connection to history.&nbsp;<a href="https://www.bullionstar.com/buy/gold-bars" style="box-sizing: border-box; color: rgb(170, 99, 39); text-decoration-line: underline;">Investment gold bars</a>&nbsp;from the world&#39;s major gold refineries are distinctively different from each other and you can vary a collection by cast or minted bars, and a selection of weights.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">24. Physical Gold Feels like Real Wealth</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Physical gold feels like real wealth. When you hold ten 1 ounce gold coins in your hand, you intrinsically know that you are holding real wealth, gold that is scarce and that has been costly to produce.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">25. Gold as Loan Collateral</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold can be used as loan collateral. Since gold is highly liquid and valuable, it can be lent and used as a form of financing, and as a way of generating interest. The wholesale gold lending market between central banks and bullion banks is highly active. Likewise, retail gold holders can also in various ways lend their gold to receive financing or interest, with new innovations to do this arising all the time.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">26. Central Banks hold Gold</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Although the world&rsquo;s central banks like to downplay the importance of gold because it competes with their fiat currencies, most central banks continue to hold substantial amounts of physical gold bars and gold coins in vaults around the world. They hold this gold as a reserve asset on their balance sheets, and they value this gold at market prices.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Like private gold investors, central banks hold physical gold because it is highly liquid, it lacks counterparty risk, and because gold is a safe haven or &lsquo;war chest&rsquo; asset that acts as a financial insurance in times of crisis. Central banks also hold gold for the unpublished reason that if and when gold re-emerges at the centre of a new monetary system, these very same central banks will not be caught out having no gold.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">27. Gold for Gifting</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold coins and small gold bars make great gifts and presents, and gold is a traditional form of gifting in many societies around the world. Gifting a gold coin or small gold bar to mark a birth, or anniversary, or a wedding or other special occasion, is an ideal present that will be highly appreciated by the recipient.</p> <h3 style="box-sizing: border-box; clear: both; font-family: Helvetica, sans-serif; line-height: 1.3; font-size: 18px; margin-top: 22px; margin-bottom: 22px; color: rgb(48, 48, 48);">28. Gold for Inheritance</h3> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;">Gold bars and gold coins are a great form of inheritance for your children and family members. Because gold is real, tangible, valuable, and has a highly liquid trading market, it is an ideal asset for inter-generational wealth transfers. Because physical gold is fabricated in convenient weight denominations, such as troy ounces and kilograms, it can be distributed equitably among recipients, and specified equitably in wills and trusts.</p> <p style="box-sizing: border-box; margin-top: 0px; margin-bottom: 24px; color: rgb(48, 48, 48); font-family: Arial, sans-serif; font-size: 12px;"><span style="font-size:14px;"><em><strong>This article originally appeared on the <a href="http://www.bullionstar.com">BullionStar.com</a> website under the same title &quot;<a href="https://www.bullionstar.com/blogs/bullionstar/reasons-buy-gold/">28 Reasons to Buy Physical Gold</a>&quot;.</strong></em></span></p> http://www.zerohedge.com/news/2017-11-23/28-reasons-buy-physical-gold#comments Bond British Ministry of Defense Bullion Business Central Banks Currency default Economy Emergency Money Military Federal Reserve Fiat money Finance Futures market Gold Gold coin Gold standard Greece International trade Investment Grade Middle East Middle East Monetary policy Money Precious metals Purchasing Power Quantitative Easing Turkey US Federal Reserve Volatility World Gold Council World Gold Council Thu, 23 Nov 2017 16:07:26 +0000 BullionStar 607809 at http://www.zerohedge.com Ethereum Soars To Record High After South Korea Regulator Confirms "No Plan" To Regulate Cryptos http://www.zerohedge.com/news/2017-11-23/ethereum-soars-record-high-after-south-korea-regulator-confirms-no-plan-regulate-cry <p dir="ltr">In September,<a href="https://cointelegraph.com/news/south-korea-in-centre-of-bitcoin-universe-as-it-passes-china-in-bitcoin-trading"> South Korea surpassed China in total crypto trading volumes</a>, and <strong>as the world&rsquo;s second largest Ethereum exchange market, South Korea is evolving into an&nbsp;<a href="https://cointelegraph.com/tags/south-korea" target="_blank">Ethereum powerhouse</a></strong>&nbsp;with a rapidly growing number of active developments, domestic projects and communities.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_ETH1.jpg"><img height="353" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_ETH1_0.jpg" width="600" /></a></p> <p><a href="https://cointelegraph.com/news/south-korea-is-evolving-into-an-ethereum-powerhouse"><em>image courtesy of CoinTelegraph</em></a></p> <p><a href="https://cointelegraph.com/news/south-korea-is-evolving-into-an-ethereum-powerhouse"><em>As CoinTelegraph reported previously</em></a>, the <strong>majority of traders in the South Korean Ethereum market are speculative investors and tend to be largely influenced by any movement in the industry that could lead to a decline in Ethereum price. However, a fairly large portion of investors are avid supporters of Ethereum as a technology and an infrastructure for decentralized applications.</strong></p> <p dir="ltr">At the moment,&nbsp;<a href="https://cointelegraph.com/tags/ico" target="_blank">ICOs</a>&nbsp;seem like the largest market for Ethereum. In the upcoming years, it is likely that the performance of decentralized applications will evolve as a major factor for the market cap of Ethereum. In an interview with JoongAng, a leading finance news publication in South Korea, Buterin emphasized that it could take two to five years for Ethereum to scale to a point in which decentralized applications with millions of users can be launched and sustained.</p> <p dir="ltr">There are many multi-billion dollar conglomerates and financial institutions in the Ethereum industry developing decentralized applications and platforms on top of the Ethereum protocol. The emergence of efficient and innovative scaling solutions will create a better environment for decentralized applications and will allow highly anticipated projects such as decentralized cryptocurrency exchanges and marketplaces to evolve.</p> <p><strong>If support and enthusiasm toward Ethereum in South Korea are sustained in the mid-term, it is highly likely that the South Korean Ethereum exchange market could evolve into an Ethereum powerhouse. </strong>As Buterin noted in the interview with JoongAng in the upcoming years, applications of Ethereum in a variety of industries will be tested and implemented.</p> <p>Buterin&nbsp;<a href="http://koreajoongangdaily.joins.com/news/article/article.aspx?aid=3038837&amp;cloc=etc%7Cjad%7Cgooglenews" rel="nofollow" target="_blank">explains</a>:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p dir="ltr">&ldquo;I would say that Ethereum&rsquo;s main benefits are in its generality and in its utility to many kinds of industries. There are applications in finance, identity, supply chain tracking, health care, energy and many other areas. This is a result of Ethereum deliberately being designed as a general-purpose programming platform.&rdquo;</p> </blockquote> <p>And now, given the overnight news from South Korean regulators, it appears Ethereum has that chance...</p> <p><a href="https://www.coindesk.com/south-korean-finance-watchdog-has-no-plans-to-regulate-bitcoin-trading/">As CoinDesk reports</a>,<strong> <u>the governor of a South Korean financial regulator has said it has &quot;no plans&quot; to supervise cryptocurrency trading</u>, </strong>according to a report.</p> <p>In remarks made to reporters today, Choe Heung-sik, chief of the Financial Supervisory Service (FSS), said that,<strong> since his agency does not view cryptocurrencies as &quot;legitimate currency,&quot; the FSS does not intend to supervise trading of the digital assets.</strong></p> <p>According to a&nbsp;<a href="http://www.koreatimes.co.kr/www/biz/2017/11/488_239795.html">Korea Times</a>&nbsp;report, Choe added<strong> the South Korean government believes that cryptocurrencies are used in speculation, not as payment tools.</strong> As a result, the watchdog considers that cryptocurrencies are not financial products, nor is trading them a financial service.</p> <p>He said:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em><strong>&quot;Though we are monitoring the practice of cryptocurrency trading, we don&#39;t have plans right now to directly supervise exchanges. Supervision will come only after the legal recognition of digital tokens as a legitimate currency.&quot;</strong></em></p> </blockquote> <p>The watchdog head&#39;s comments come amid growing popularity of&nbsp;cryptocurrency trading in South Korea, and may have been prompted by the recent outage of major domestic exchange Bithumb, which recently experienced a technical outage that&nbsp;<a href="https://www.financemagnates.com/cryptocurrency/exchange/korean-traders-file-class-action-lawsuit-bithumb-server-outage/">reportedly</a>&nbsp;lost traders billions of won.</p> <p>But his comments appear to have quelled any anxiety among speculators, as is clear by the reaction in Ethereum - the South Koreans&#39; confidence is back...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_ETH.jpg"><img height="337" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_ETH_0.jpg" width="600" /></a></p> <p>&nbsp;</p> <p>Which leaves Ethereum solidly in 2nd place among crypto market caps...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_ETH2.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/11/21/20171123_ETH2_0.jpg" style="width: 600px; height: 283px;" /></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="714" height="420" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20171123_ETH1.jpg?1511448856" /> </div> </div> </div> http://www.zerohedge.com/news/2017-11-23/ethereum-soars-record-high-after-south-korea-regulator-confirms-no-plan-regulate-cry#comments Alternative currencies Augur Blockchains Business China Cross-platform software Cryptocurrencies Digital currency Draft:OmiseGO E-commerce Ethereum Ethereum protocol Finance Financial Supervisory Service Money Smart contract South Korean government Thu, 23 Nov 2017 15:45:00 +0000 Tyler Durden 607804 at http://www.zerohedge.com JFK Files Reveal Bobby Kennedy And CIA Plotted False Flag War With USSR http://www.zerohedge.com/news/2017-11-22/jfk-files-reveal-ag-robert-kennedy-and-cia-plotting-false-flag-attacks-provoke-war-u <p>False flag conspiracy theories have arisen from thousands of global tragedies ever since pirates allegedly spawned the term by flying the flag of the home country they were preparing to attack.&nbsp; <strong>Of course, these "conspiracy theories" would be far easier to discredit if they'd stop coming true...</strong></p> <p>Alas, a recently revealed document from the so-called 'JFK Files' will only serve to stoke the flames of conspiracy theorists as it very <strong>clearly confirms a plot crafted by then Attorney General Robert Kennedy and the CIA to carry out a false attack that could be pinned on the USSR and serve as a basis for a U.S. "counterattack".</strong></p> <p>According to a formerly "Top Secret" document summarizing a meeting from March 22, 1962, officials from JFK administration secretly strategized on the best way to "manufacture or acquire Soviet aircraft," including a MIG 17 or MIG 19.&nbsp; Per the following <a href="https://www.archives.gov/files/research/jfk/releases/docid-32977055.pdf">except</a>, <strong>plans ranged from building aircraft that could stand up "distant observation" or "close observation" and ranged in cost from $3.5 million to $22 million.</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/11/22/2017.11.22 - JFK 1.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/11/22/2017.11.22%20-%20JFK%201_0.jpg" style="width: 600px; height: 489px;" /></a></p> <p>So what were these replica planes to be used for?&nbsp; Well, it turns out those details were laid out with some level of specificity as well...that is, if you can get beyond the brilliant efforts at redaction in the excerpt below...</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>"There is a possibility that such aircraft could be used in a deception operation designed to confuse enemy planes in the air, to launch a surprise attack against enemy installation <span style="text-decoration: underline;"><strong>or in a provocation operation in which Soviet aircraft would appear to attack U.S. or friendly installations in order to provide an excuse for U.S. intervention.</strong></span> If the planes were to be used in such covert operations, it would seem preferable to manufacture them in the United States."</p> </blockquote> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/11/22/2017.11.22 - JFK 2.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/11/22/2017.11.22%20-%20JFK%202_0.jpg" style="width: 600px; height: 189px;" /></a></p> <p>According to the <a href="http://dailycaller.com/2017/11/19/jfk-files-us-contemplated-fake-soviet-attack-to-provoke-war/">Daily Caller</a>, the meeting was held by the “Special Group (Augmented),” which according to an encyclopedia on the Central Intelligence Agency, included <strong>Attorney General Robert Kennedy, CIA Director John McCone, National Security Advisor McGeorge Bundy and chairman of the Joint Chiefs of Staff Lyman Lemnitzer.</strong> And while not members, President Kennedy and Secretary of State Dean Rusk were said to attend certain meetings as well.</p> <p>Perhaps it's time to once again reassess what you 'think' you know...</p> <p><em><strong>With that, here is the<a href="https://www.archives.gov/files/research/jfk/releases/docid-32977055.pdf"> full document</a>:</strong></em></p> <p><iframe src="https://www.scribd.com/embeds/365197353/content?start_page=1&amp;view_mode=scroll&amp;access_key=key-kMB5kOP9GFaq9xLXOak4&amp;show_recommendations=true" width="100%" height="600" frameborder="0" scrolling="no"></iframe></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="830" height="439" alt="" src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017.11.22%20-%20JFK%20Tease.JPG?1511369733" /> </div> </div> </div> http://www.zerohedge.com/news/2017-11-22/jfk-files-reveal-ag-robert-kennedy-and-cia-plotting-false-flag-attacks-provoke-war-u#comments 9/11 conspiracy theories Bouvier family CAPTCHA Central Intelligence Agency Central Intelligence Agency Conspiracy theory JFK JFK administration John F. Kennedy Kennedy family Lyman Lemnitzer Massachusetts Military personnel national security Politics Robert F. Kennedy United States Thu, 23 Nov 2017 15:40:00 +0000 Tyler Durden 607764 at http://www.zerohedge.com