http://www.zerohedge.com/fullrss2.xml/component/option%2Ccom_docman/itemid%2C200023/gid%2C397/boombustblog/boombustblog/boombustblog/boombustblog/is-this-the-breaking-of-the-bear.html en "Big Swinging Dick" Defined http://www.zerohedge.com/news/2017-06-25/big-swinging-dick-defined <p><a href="https://www.linkedin.com/pulse/how-calculate-trade-size-erico-matias-tavares"><em>Authored by Erico Matias Tavares via Sinclair &amp; Co.,</em></a></p> <div class="prose"> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div> <p><em>&quot;<span style="text-decoration: underline;">Big Swinging Dick</span>: (Very) informal and somewhat derogatory; a trader who believes his methodology is perfect and will always result in sizable profits. However, it originally was a term of self-designation for major bond-traders. The term was popularized by the book Liar&#39;s Poker, which describes the author&#39;s experience as a bond trader on Wall Street in the 1980s.&quot; Source: </em><a href="http://financial-dictionary.thefreedictionary.com/Big+Swinging+Dick" rel="nofollow noopener" target="_blank"><em>financial dictionary</em></a></p> </blockquote> <p><strong>While much has been written about trade size, meaning how much trading capital should be risked on each trade, this remains a nebulous imprecise topic.</strong></p> <p>That&rsquo;s unfortunate because it can make all the difference between staying in the game or losing all trading capital &ndash; <strong>known in the business as &ldquo;blowing up&rdquo;.</strong> Yes, even (especially) if you are a big swinger.</p> <p>The concept of a &quot;<a href="https://www.linkedin.com/pulse/trading-living-interview-adam-grimes-erico-matias-tavares" target="_blank">trading edge</a>&quot; is central here. Broadly speaking, this is how much a trader is expected to make over a reasonable number of trades (meaning, with some statistical significance), taking into consideration the risk of loss and how much will be made or lost with each trade on average.</p> <p><strong>Basically, if you don&rsquo;t know what your edge is you should not be trading, or gambling for that matter.</strong> Buying and holding for some time perhaps, but not regularly going in and out of the market without a good plan.</p> <p>Let&rsquo;s assume that you are in a situation where you have a negative edge, by definition meaning you are likely to lose money over a large enough number of trades. The conventional example is a casino, where as we know the house always wins in the end because of that reason.<strong><em> So as you walk through the entrance, how large should your bet size be?</em></strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_BSD.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_BSD.jpg" style="width: 599px; height: 322px;" /></a></p> <p><strong>Surprisingly to some, the answer is actually 100% of your capital, meaning all of it, in one go &ndash; more so if the edge is especially unfavorable to you.</strong></p> <p>Casinos want to keep their patrons gambling for as long as possible, because they know the longer they keep on playing the greater the chances they will give back all their winnings and then some. Therefore, if the goal is to maximize expected profits go for all or nothing, then walk away (unless you are there to have a good time, in which case bet as little as possible each time).</p> <p><strong>The other situation where 100% is appropriate is at the other side of the spectrum, when a trader just can&rsquo;t lose. </strong>The more capital traded each time the higher the profits will be since there are no losses. This of course is unrealistic in any speculative endeavor. It&rsquo;s mentioned here for illustrative purposes only.</p> <p><u><strong>The much trickier question lies in between those two scenarios, </strong></u>when there is a positive edge but no certainty of profit. What to do in this situation?</p> <p>Let&#39;s assume there is a 99% chance of doubling your money versus 1% of losing it all, which are fantastic odds. Since we are near certainty, should we bet everything once again?</p> <p>A big swinger surely would. However, unlikely as it may be we can still suffer a loss, which would instantly put us out of the game. The economic loss is actually much greater than the trading capital in this case, because had we managed to hold on eventually we could stand to make a lot of money with those fantastic odds. But as fate would have it, we blew up. Big swinger no more.</p> <p><strong>So no matter how good the odds with uncertainty there is nothing preventing a string of losses from occurring (that&rsquo;s how life works by the way).</strong></p> <p><u><strong>The key point here is endurance,</strong></u> meaning having enough trading capital &ndash; and mental stamina &ndash; on reserve so that if one of those mean streaks hits you can survive and eventually get back to the higher probabilities of winning again.</p> <p>As such, defining how much should be risked on each trade requires a quantifiable (even if not exact) framework that takes all these factors into consideration. Fortunately, this can be done without too many mathematical gymnastics. Here&rsquo;s one way to do it.</p> <p>Let&rsquo;s assume we trade a fixed amount of our capital, called &ldquo;R&rdquo;. That&#39;s how much we are risking each time. As a result, trade profits and losses can now be expressed as a function of R, such as a loss of -2R and a gain of 1R. This way the framework can be standardized and applied to any futures contract, stock, FOREX or bond.</p> <p>Next we assign some probability of occurrence to each resulting R level (usually based on historical analysis or backtesting). Now we can quantify the edge, which is roughly speaking the sumproduct of the two.</p> <p><strong>The graph below shows a hypothetical trading model that delivers a 0.2R on each average trade. That&rsquo;s a very decent trading system. Not only are the odds of not losing money higher than losing it, wins are skewed heavily to the upside.</strong></p> <div class="slate-resizable-image-embed slate-image-embed__resize-full-width"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_BSD1.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_BSD1_0.png" style="width: 600px; height: 224px;" /></a></div> <p>Any trader would love to use such a system any time of the year. However, even if on paper the results look great, it is worth remembering that these are based on statistical averages. This can make all the difference in the world, potentially generating some pretty big swings in your accumulated trading capital over time.</p> <p>To illustrate how, let&rsquo;s also assume that we trade this system once every week for ten years, so 52 x 10 trades in total. We define cumulative loss as the maximum loss in terms of R from a trading capital high to a trading capital low over the course of those ten years. This is actually a very important number since a lot of things can happen during that time frame.</p> <p>As a side note, we are putting on the trades sequentially in a portfolio of one security only. This avoids the complication of figuring out correlation coefficients between securities, where any correlation less than perfect would yield some diversification benefit, in principle reducing the cumulative loss. So we are using the most conservative scenario here.</p> <p>Finally, Microsoft Excel is used to generate 520 random trades over 1000 times to derive the average cumulative loss.<strong> This is like 1000 traders using the same exact system completely independently, and that high number carries some statistical robustness. The resulting histogram is shown below:</strong></p> <div class="slate-resizable-image-embed slate-image-embed__resize-full-width"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_BSD2.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_BSD2_0.png" style="width: 600px; height: 291px;" /></a></div> <p>We can<u><strong> immediately observe how luck plays such a prominent role in trading</strong></u> (or any activity that involves risk for that matter), even when the edge of the system is quite positive: traders using exactly the same system can experience cumulative losses ranging from 5R all the way to 43R. Of course these are extremes (or tails) with limited occurrences but it does highlight the point.</p> <p>There is some concentration of outcomes around 12R, the cumulative loss with the most occurrences. But the chance of actually losing more than, say, 19R at some point is over one in five so the tail risk is clearly not insignificant. And it&rsquo;s also a function of trading over 10 years using this particular system. If it had been, say, just two years (104 sequential trades) that figure would have been 2%, virtually one tenth of that.</p> <p><strong>In other words, the more you trade the higher the odds you will have a big losing streak at some point, unlikely as that may be. As professional traders often remind us, the worst drawdown is always ahead of us. We can see why here.</strong></p> <p>That&rsquo;s a hugely underappreciated point that is often lacking in more meaningful discussions about trade size. And it makes sense. The more you walk under the rain the higher the likelihood you will get wet - even if you have a great umbrella.</p> <p>If you are planning to trade sporadically and opportunistically, that&rsquo;s one thing; but if you are considering regularly going in and out of the market over many years that&#39;s quite another. Again, it bears repeating that the chances of something bad happening increase with the number of trades.</p> <p>The size of the edge also makes a huge difference to the outcome. Let&rsquo;s assume that the edge in the model above is now reduced from 0.2R to just 0.05R (by taking out five percentage points from the odds of getting 2R and allocating them to -1R). The chance of losing more than 19R over ten years is now a staggering 73%.</p> <p><strong>So the worse the edge the greater the chances of having a string of losses. As it should be of course.</strong></p> <p>Why are such tail numbers relevant? Because if there isn&rsquo;t enough capital set aside you will blow up your trading account. Pure and simple.</p> <p>The higher that tail risk the smaller the trade size should be so you have enough cash stashed away for that rainy day. And this should have implications on how trades are structured.</p> <p>Moreover, market conditions can and do change, possibly even invalidating the trading system and the edge altogether. In times of great volatility for instance, where swings can frequently occur in both directions, it pays to play even safer than suggested by these figures.</p> <p><strong>Going back to the original framework, setting aside just 19R of our capital aside and betting the rest on each trade means there&rsquo;s a 20% chance of blowing up over those ten years. </strong>That&rsquo;s too much for our risk appetite, which means we typically err on the side of leaving more cash on the sidelines.</p> <p>How much more depends on each trader&rsquo;s tolerance. All things considered, our general preference is to use a trade size that keeps at least 50R of our capital set aside. Translating that into a percentage means that risking anything above 2% of our capital on the average trade starts raising some questions about our survivability over ten years. And that is assuming we have a trading system that delivers a sustainable positive edge, which very hard to develop in practice.</p> <p>If we are so concerned with the negative tail why not risk even less, like 1% or even just 0.5% each time? That&rsquo;s possible, but if the system does work we might be leaving money on the table. And that can add up considerably over time. In the end it all boils down to individual tolerance and confidence in the robustness of the system. There are no magical right numbers but it&rsquo;s important to be approximately right.</p> <p>This framework can also be applied in gauging the performance of fund managers. For instance, if the returns on capital employed are really good over a couple of years, can we be sure that they are setting aside enough money if they hit a bad streak? Perniciously, managers are incentivized to always use as much cash as possible, since more capital set aside lowers returns. But there are no free lunches. This comes with a longevity risk that more people ought to pay attention to.</p> <p><strong>Summing up, using a simple framework we have shown how the payoff dynamics and number of trades, usually unfolding over longer periods of time, should be part of the calculation of trade size. Their importance can be easily overlooked when blindly assuming some static assumptions over time.</strong></p> <p>Beyond that, we can only hope and pray that Lady Luck is on our side. Be that as it may, developing at least a basic understanding of mathematical and probabilistic concepts inherent in speculative activities is a must for traders. Trading without any logic or meaningful guidelines can be hazardous to anyone&#39;s health.</p> <p><u><em><strong>Otherwise better forget about trading and put everything on red the next time you go to Las Vegas. And perhaps that way you might become a big swinger instantaneously.</strong></em></u></p> </div> <p>&nbsp;</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="698" height="375" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170625_BSD.jpg?1498411387" /> </div> </div> </div> http://www.zerohedge.com/news/2017-06-25/big-swinging-dick-defined#comments Actuarial science Algorithmic trading Bond Cumulative Losses Economy Finance Financial markets Financial risk fixed Foreign exchange market Futures contract Gambling Las Vegas Market Conditions Money Share trading Stock market Value at risk Volatility Sun, 25 Jun 2017 20:30:00 +0000 Tyler Durden 598624 at http://www.zerohedge.com Defining Hypocrisy: Schumer Defends Pelosi By Telling Dems "You Don't Blame Other People For Losing" http://www.zerohedge.com/news/2017-06-25/schumer-defends-pelosi-you-dont-blame-other-people-losingsomeone-should-tell-hillary <p>After months of blaming everything under the sun for their November presidential shocker, from Putin to racism to misogyny to you name it, Chuck Schumer, the lead Democrat in the Senate, has a message for John Ossoff and all the Dems now calling for Nancy Pelosi's resignation over their latest embarrassing defeat in Georgia's 6th district: <strong>"But you lose an election, you don’t blame other people, you blame yourself."</strong></p> <p>Really? Because we're almost certain Democrats and every mainstream media outlet has done nothing but launch an all out crusade against Russia for the past 6 months rather than blame the fact that they ran a corrupt process (poor Bernie) and a failed candidate.&nbsp; Again, if someone can please tell us why the Russians were only effective in flipping votes to Trump in MI, WI, OH and PA but not in CO, NM or NV we would very much love to hear your thoughts...<strong><br /></strong></p> <p>Here is what Schumer had to say earlier on ABC's "This Week" with the always fair and balanced George Stephanopoulos.<strong><br /></strong></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>"Democrats need a strong, bold, sharp-edged and commonsense economic agenda. Policy, platform, message that appeal to the middle class, that resonate with the middle class, and show that — and unite Democrats."</p> <p>&nbsp;</p> <p>"This economic message platform is going to resonate.&nbsp; It’s what we were missing, and it’s not going to be baby steps — it’s going to bold."</p> <p>&nbsp;</p> <p><strong>"But you lose an election, you don’t blame other people, you blame yourself."</strong></p> </blockquote> <blockquote class="twitter-video"><p dir="ltr" lang="en">Schumer says Democrats were missing economic message in 2016: "When you lose an election, you don't blame other people. You blame yourself." <a href="https://t.co/pExnfYsXrv">pic.twitter.com/pExnfYsXrv</a></p> <p>— This Week (@ThisWeekABC) <a href="https://twitter.com/ThisWeekABC/status/878971240937005058">June 25, 2017</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>&nbsp;</p> <p>But, if Schumer is suddenly having a change of heart on the whole blame game thing...we would fully support it.&nbsp; That said, he should probably reach out to Hillary to relay the new strategy because apparently she<strong> "Has 39 Problems, But Hillary Ain't One."</strong></p> <p><iframe src="https://www.youtube.com/embed/C0DCBUE3HiU" width="600" height="337" frameborder="0"></iframe></p> <p>&nbsp;</p> <p><strong>In conclusion:</strong></p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25%20-%20Chuck%202_0.JPG" alt="Pot" width="600" height="401" /></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="611" height="348" alt="" src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017.06.25%20-%20Chuck%20Schumer.JPG?1498406089" /> </div> </div> </div> http://www.zerohedge.com/news/2017-06-25/schumer-defends-pelosi-you-dont-blame-other-people-losingsomeone-should-tell-hillary#comments Blame Chuck Schumer Dismissal of United States Attorneys controversy George Stephanopoulos Hillary Clinton Horse racing Nancy Pelosi Politics Senate Social Issues Twitter Twitter United States Sun, 25 Jun 2017 20:00:00 +0000 Tyler Durden 598618 at http://www.zerohedge.com Megyn Kelly Fails To Fact Check Sandy Hook Father's Contradictory Claim In Alex Jones Hit Piece http://www.zerohedge.com/news/2017-06-25/megyn-kelly-fails-fact-check-sandy-hook-fathers-contradictory-claim-alex-jones-hit-p <p><img src="https://ibankcoin.com/zeropointnow/files/2017/06/kel3.jpg" width="500" height="279" style="display: block; margin-left: auto; margin-right: auto;" /></p> <p style="box-sizing: border-box; margin-top: 0.25em; margin-bottom: 0.75em; font-variant-numeric: inherit; font-stretch: inherit; font-size: 13px; line-height: 1.3; font-family: lucida_granderegular, Verdana, sans-serif;">&nbsp;</p> <p style="box-sizing: border-box; margin-top: 0.25em; margin-bottom: 0.75em; font-variant-numeric: inherit; font-stretch: inherit; font-size: 13px; line-height: 1.3; font-family: lucida_granderegular, Verdana, sans-serif;"><span style="box-sizing: border-box; border-color: currentcolor; font-variant-numeric: inherit; font-stretch: inherit; line-height: inherit;">Content originally published at&nbsp;</span><a href="http://ibankcoin.com/" style="box-sizing: border-box; border-color: currentcolor; font-variant-numeric: inherit; font-stretch: inherit; line-height: 1.2; word-wrap: break-word; color: #1e439a;">iBankCoin.com</a></p> <div><span style="font-size: 13.008px;">Last Sunday's exposé of&nbsp;Alex Jones&nbsp;on NBC's&nbsp;</span><em style="font-size: 13.008px;">Sunday Night With Megyn Kelly&nbsp;</em><span style="font-size: 13.008px;">was considered by many to be&nbsp;a&nbsp;tasteless and&nbsp;heavily edited&nbsp;attempt&nbsp;to smear the Infowars host and vocal supporter of Donald Trump. Despite a week of heavy promotion, the segment backfired -&nbsp;sending&nbsp;Kelly's ratings further&nbsp;into the toilet&nbsp;a week after&nbsp;her </span><a href="http://www.latimes.com/entertainment/tv/la-et-st-sundays-with-megyn-kelly-review-20170604-story.html" target="_blank" style="font-size: 13.008px;" rel="noopener noreferrer">embarrassing interview</a><span style="font-size: 13.008px;"> with Russian President Vladimir Putin&nbsp;-&nbsp;an encounter which&nbsp;director Oliver Stone said she was '</span><a href="http://pagesix.com/2017/06/07/oliver-stone-beautiful-megyn-kelly-was-not-prepared-for-putin-interview/" target="_blank" style="font-size: 13.008px;" rel="noopener noreferrer">not prepared for.</a><span style="font-size: 13.008px;">'</span></div> <p>This lack of preparation was obvious in the Jones interview - as Kelly and NBC aired footage of&nbsp;the grieving father of a Sandy Hook massacre victim which contains a <strong>major contradiction</strong> to the official story.</p> <p><strong>Neil Heslin</strong></p> <p>Prominently featured&nbsp;in the exposé is&nbsp;<a href="https://ibankcoin.com/zeropointnow/files/2017/06/Neil-Heslin-at-17-minutes-in.jpg" target="_blank" rel="noopener noreferrer">Neil Heslin</a> - a father of one of the victims. During his interview with Megyn&nbsp;Kelly,&nbsp;Heslin&nbsp;described what happened the day of the shooting when 20 year old Adam Lanza murdered 20 children and&nbsp;six adults at Sandy Hook Elementary school before committing suicide.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>I dropped him off at 9:04. That's when we dropped him off at school with his book bag. Hours later I was picking' him up in a body bag.</p> <p>&nbsp;</p> <p>I lost my son. I buried my son. <strong>I held my son with a bullet hole through his head.</strong></p> </blockquote> <p>&nbsp;</p> <div class="wpview wpview-wrap"><iframe src="https://www.youtube.com/embed/RfZLbsAwHq0?feature=oembed" width="618" height="464" frameborder="0"></iframe><span class="mce-shim">&nbsp;</span><span class="wpview-end">&nbsp;</span></div> <p><strong>Except this does not comport with the official story</strong></p> <p>Jim Fetzer,&nbsp;Professor Emeritus&nbsp;at the University of Minnesota who <a href="http://www.rense.com/general96/NobodyDiedAtSandyHook_final.pdf" target="_blank" rel="noopener noreferrer">wrote a book</a> claiming Sandy Hook was staged, <a href="http://jamesfetzer.blogspot.com/2017/06/sandy-hook-neil-heslin-contradicts.html?m=1">notes</a> that based on the facts of the case, Heslin's statement that he 'held his son with a bullet hole through his head' <strong>could not have happened</strong>.&nbsp;According to Coroner Wayne Carver, M.D., the parents of the victims weren't allowed to see their children's bodies - and were instead shown pictures to identify the deceased. Anderson Cooper even interviewed&nbsp;the parents of one of the victims about not being able to see their child.</p> <p>&nbsp;</p> <div class="wpview wpview-wrap"><iframe src="https://www.youtube.com/embed/Qp0U6r8Xfz0?feature=oembed" width="618" height="348" frameborder="0"></iframe><span class="mce-shim">&nbsp;</span></div> <p>While&nbsp;it's entirely possible that&nbsp;Mr. Heslin had access to his son after the shooting,&nbsp;given the highly contentious nature of the Sandy Hook massacre in which&nbsp;<em>every aspect</em> of the case&nbsp;has been&nbsp;pored over and dissected&nbsp;- <strong>it was incumbent upon Megyn Kelly and NBC to familiarize themselves with all sides of the argument so they could have&nbsp;identified and explained Heslin's statement. </strong></p> <p>By airing such an obvious contradiction to the official narrative, Megyn Kelly and NBC have&nbsp;lent credibility to&nbsp;Fetzer and other conspiracy researchers who often&nbsp;point to inconsistent reports from the MSM to support their theories.</p> <p><strong>She lied...</strong></p> <p>While Megyn Kelly can be heard weeks before the interview on a&nbsp;<strong><a href="http://ibankcoin.com/zeropointnow/2017/06/16/alex-jones-gets-jump-on-megyn-kelly-leaks-recordings-to-set-the-record-straight/#sthash.WihL9wKl.dpbs" target="_blank" rel="noopener noreferrer">leaked recording</a></strong>&nbsp;promising Jones that&nbsp;the&nbsp;segment&nbsp;wouldn't be a 'hit job,' a&nbsp;promo released by NBC revealed <strong>she lied -&nbsp;</strong>as&nbsp;it was obvious Kelly was going to focus on statements made on Infowars about the 2012&nbsp;massacre at <strong>Sandy Hook Elementary School</strong> in Newtown, MA committed by Adam Lanza.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>She's a lawyer. It was a total cross-examination... <strong>And when I said that I believe children died at Sandy Hook, as I've said for years, she kept coming back with answers saying "you believe nobody died! You believe Anderson Cooper was involved!"</strong> and I said "NO! My listeners questioned it, I had debates with both sides, and <strong>I played devil's advocate</strong>." -<em>Alex Jones</em></p> </blockquote> <p>As a result of NBC's decision to air the piece, several corporate sponsors pulled advertisements, Megyn&nbsp;Kelly was disinvited&nbsp;to an anti 2nd Amendment event, and <strong><a href="http://ibankcoin.com/zeropointnow/2017/06/13/alex-jones-implores-nbc-not-to-air-interview-with-liar-megyn-kelly-jp-morgan-pulls-ads/#sthash.ZwwSMHGe.dpbs" target="_blank" rel="noopener noreferrer">Jones implored&nbsp;NBC</a> </strong>not to air the segment on Father's Day - citing the inappropriate timing.</p> <p><strong>Sandy Hook Questions</strong></p> <p>The <a href="http://www.ct.gov/csao/lib/csao/Sandy_Hook_Final_Report.pdf" target="_blank" rel="noopener noreferrer">final report</a> on the Sandy Hook shooting&nbsp;concludes that Adam Lanza, 20,&nbsp;was a socially awkward lone gunman with unmedicated Obsessive Compulsive Disorder&nbsp;whose mother gave him negligent access to&nbsp;firearms&nbsp;- however&nbsp;several&nbsp;inconsistencies&nbsp;in the official report&nbsp;have&nbsp;led&nbsp;many to speculate&nbsp;that the incident was a hoax or a 'false flag' staged to justify gun control measures.</p> <p>Among the questions people have:</p> <ul> <li>Why were there reports of men&nbsp;dressed in camouflage who fled into the woods - one of whom police allegedly detained?</li> <li>Why does Sandy Hook father Robbie Parker appear to '<a href="https://youtu.be/MwudDfz1yAk?t=428" target="_blank" rel="noopener noreferrer">get into character</a>'</li> <li>Why&nbsp;does the Sandy Hook Elementary website have <a href="https://ibankcoin.com/zeropointnow/files/2017/06/zerotraffic.png">no internet archive</a> for four years? Was the school even open?</li> <li>Why does it appear that several <a href="https://ibankcoin.com/zeropointnow/files/2017/06/before.png" target="_blank" rel="noopener noreferrer">charities were set up</a> before the December 14th&nbsp;shooting?</li> <li>Why weren't the Victims' parents allowed to see their children's bodies?</li> </ul> <p>While <strong>several Sandy Hook questions have been debunked</strong> - such as the missing&nbsp;<a href="http://www.crisisactorsguild.com/2016/05/12/why-the-most-compelling-evidence-in-nobody-died-at-sandy-hook-is-a-total-bust/" target="_blank" rel="noopener noreferrer">internet archive</a>,&nbsp;the massacre&nbsp;remains a hotly contested topic across the internet.</p> <p><strong>Alex Jones' <a href="https://youtu.be/MwudDfz1yAk" target="_blank" rel="noopener noreferrer">official position</a></strong> is that he believes children died in the shooting - in fact,&nbsp;during a <a href="https://fellowshipoftheminds.com/2014/05/09/citizens-confront-newtown-board-of-education-about-sandy-hook-hoax/" target="_blank" rel="noopener noreferrer">2014 account</a> of a hearing before the Newtown Board of Education, an Infowars journalist "<strong>did not dispute that Adam Lanza had perpetrated the shooting</strong>."</p> <p><img src="https://ibankcoin.com/zeropointnow/files/2017/06/manfrom.png" width="782" height="167" style="display: block; margin-left: auto; margin-right: auto;" class="aligncenter wp-image-9366 size-full" /></p> <p>Yet despite Jones' official position,&nbsp;he and&nbsp;Infowars have played&nbsp;devil's advocate&nbsp;along the way&nbsp;-&nbsp;presenting&nbsp;facts and narratives which&nbsp;disagree with the official story.</p> <p>And while Jones has presented a number of angles to the Sandy Hook massacre, Megyn Kelly and NBC chose to distort&nbsp;the facts through their lens of propaganda&nbsp;to fit their case against the Infowars host, while airing a&nbsp;gaping hole in the official story in their quest to destroy Alex Jones.</p> <p><strong>This needs to be addressed</strong></p> <p>By&nbsp;failing to identify&nbsp;the obvious contradiction between Neil Heslin's account and&nbsp;the official story, Kelly and her network have&nbsp;fanned the very flames of doubt and conspiracy&nbsp;they sought to silence, creating more questions than answers.</p> <p>For the sake of all the Sandy Hook&nbsp;parents who weren't allowed to see their deceased children, and to&nbsp;settle this new piece of fodder for conspiracy theorists which&nbsp;<em>they</em> aired,&nbsp;Megyn Kelly and NBC have a responsibility to address this giant contradiction to the official story.</p> <p>&nbsp;</p> <p style="text-align: center;"><span class="wpview-end" style="box-sizing: border-box; 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font-variant-numeric: inherit; font-stretch: inherit; font-size: 13px; line-height: inherit; font-family: lucida_granderegular, Verdana, sans-serif; text-align: center;">&nbsp;Subscribe to our&nbsp;</span><strong style="box-sizing: border-box; border-color: currentcolor; font-variant-numeric: inherit; font-stretch: inherit; font-size: 13px; line-height: inherit; font-family: lucida_granderegular, Verdana, sans-serif; text-align: center;"><a href="https://www.youtube.com/subscription_center?add_user=ibankcoin" target="_blank" style="box-sizing: border-box; border-color: currentcolor; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; font-size: inherit; line-height: 1.2; font-family: inherit; word-wrap: break-word; color: #1e439a;">YouTube channel</a></strong></p> http://www.zerohedge.com/news/2017-06-25/megyn-kelly-fails-fact-check-sandy-hook-fathers-contradictory-claim-alex-jones-hit-p#comments Activism Alex Jones American people of German descent Conservatism in the United States Donald Trump James H. Fetzer Lanza Megyn Kelly NBC NBC News Newtown Board of Education Newtown Public Schools Newtown, Connecticut ratings Sandy Hook Elementary School Sandy Hook Elementary School shooting Twitter Twitter United States University of Minnesota Vladimir Putin Sun, 25 Jun 2017 19:35:57 +0000 ZeroPointNow 598631 at http://www.zerohedge.com Get Ready For "QT1": A First Look At The Fed's Hidden Policy http://www.zerohedge.com/news/2017-06-25/get-ready-qt1-first-look-feds-hidden-policy <p><a href="https://dailyreckoning.com/quantitative-tightening-fed-hidden-policy/"><em>Authored by James Rickards via The Daily Reckoning,</em></a></p> <p>The Federal Reserve is now setting out on a new path for quantitative tightening (QT) after nine years of unconventional quantitative (QE) easing policy. <strong>It is the evil twin of QE </strong>which was used to ease monetary conditions when interest rates were already zero.</p> <p><span style="font-weight: 400;"><strong>First, it is important to examine QE and QT in a broader context of the Fed&rsquo;s overall policy toolkit.</strong> Understanding the </span><a href="https://dailyreckoning.com/inside-the-fed-tool-kit/" target="_blank"><span style="font-weight: 400;">many tools the Fed has</span></a><span style="font-weight: 400;">, which of them they&rsquo;re using and what the impacts are will allow you to distinguish between what the Fed thinks versus what actually happens.</span></p> <p><span style="font-weight: 400;">We have a heavily manipulated system. For years, if not decades, monetary policy has been <strong>flipping back and forth between how the economy actually works and what the Fed believes works.</strong></span></p> <p><span style="font-weight: 400;">QE was a policy of printing money by buying securities from primary dealers and to ease monetary conditions when interest rates were at zero. QT takes a different approach.</span></p> <p><strong><a href="https://dailyreckoning.com/get-ready-quantitative-tightening/" target="_blank"><span style="font-weight: 400;">In QT, the Fed will &ldquo;sell&rdquo; securities</span></a></strong><span style="font-weight: 400;"><strong> to the primary dealers, take the money, and make it disappear. </strong>This is an attempt to ultimately reduce the money supply and implement a policy of tightening money.</span></p> <p><span style="font-weight: 400;">There&rsquo;s a bit of a twist to that <em>selling</em>. Today the Fed&rsquo;s balance sheet stands at $4.5 trillion. It started at $800 billion in 2008 and has increased over five times that since the crisis. Now they&rsquo;re going to try to get the balance sheet back to normal levels.</span></p> <p><strong>Simultaneously, the Fed wants to get interest rates to back to normal. </strong><a href="https://dailyreckoning.com/quantitative-tightening/" target="_blank"><span style="font-weight: 400;">The Taylor rule</span></a><span style="font-weight: 400;">, which is one of the most accepted normative rules, indicates that interest rates should be 2.5%. As of June 14th, the Fed raised rates by going up 1%, with a new target range of 1 to 1.25%.</span></p> <p><strong>The Fed hiked rates not because it believes the economy is getting stronger, but because it is desperately trying to catch up &mdash; before the next crisis.</strong></p> <p><span style="font-weight: 400;"><u><strong>They are now trying to normalize the balance sheet.</strong></u> Under the Taylor Rule a normal balance sheet at the current expansion rate could be expected to be at $2.5 trillion. That means you have to take $2 trillion of money and make it disappear.</span></p> <p>They can do that by selling securities, but the Fed believes that the market&rsquo;s too fragile. Instead they&rsquo;re going to leave securities on the balance sheet and allow them to mature. Think of this as the Fed putting QE in reverse.</p> <p><strong><span style="font-weight: 400;">The Fed has been rolling over the balance sheet to keep it at $4.5 trillion.</span></strong></p> <p>You&rsquo;ll be hearing more about quantitative tightening in the weeks and months ahead for 2017.</p> <p><strong>What quantitative tightening means is that they&rsquo;re going to stop rolling it over.</strong></p> <p><span style="font-weight: 400;">That means as securities mature and the Treasury sends out money they&rsquo;re not going to buy, replenish or buy more. <strong>This should cause the balance sheet to shrink and the money supply to be reduced.</strong> The Fed is not going to do it all at once.</span></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170623_EOD1_1.jpg"><span style="font-weight: 400;"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170623_EOD1_1_0.jpg" style="width: 600px; height: 253px;" /></span></a></p> <p><span style="font-weight: 400;">The </span><a href="https://dailyreckoning.com/markets-priced-perfection/" target="_blank"><span style="font-weight: 400;">real news the market will continue watching</span></a><span style="font-weight: 400;"> at the Fed and its Federal Open Market Committee (FOMC) will be quantitative tightening (QT). While the Fed might not use the exact QT language, they will intend to reduce rollovers of long-term asset purchases.</span></p> <p><strong>The same way they tapered QE, they&rsquo;re going to taper QT. This time however, they&rsquo;re going to taper upward. </strong>Meaning they&rsquo;re going to go from $10 billion a month not being rolled over to $20 billion, $30 billion, etc.</p> <h2><u><strong>Quantitative Tightening and Wall Street</strong></u></h2> <p><span style="font-weight: 400;">Eventually, the amount of securities they don&rsquo;t roll over will go up until the balance sheet controlled by the Fed comes down to the targeted figure. The projection is that it could take 10 years to achieve. The problem is we might not make it that </span><a href="https://dailyreckoning.com/recession-closer-realize/" target="_blank"><span style="font-weight: 400;">far before the entire system collapses</span></a><span style="font-weight: 400;">.</span></p> <p><strong>We&rsquo;re in a new reality.</strong></p> <p><span style="font-weight: 400;">By raising rates and leaving open the possibility of further increases, all of the monetary actions being taken are tightening the economy. The Fed&rsquo;s QT policy that aims to tighten monetary conditions, reduce the money supply and increase interest rates <strong>will cause the economy to hit a&nbsp;wall.</strong></span></p> <p>The decision by the Fed to not purchase new bonds will be just as detrimental to tightening of the economy as raising interest rates.</p> <p><span style="font-weight: 400;"><strong>The economy is slowing.</strong> Even without any action, retail sales, real incomes, auto sales and even labor force participation are all&nbsp;declining. Every important economic indicator shows that the US economy is slowing right now. When you add in rate hikes and QT, we may very well be in a recession by later this year.</span></p> <p><strong><em>The Fed is tightening into weakness. </em></strong></p> <p><span style="font-weight: 400;">Because they&rsquo;re getting ready for a potential recession where they&rsquo;ll have to cut yet again. Then it&rsquo;s back to QE. You could call that QE4 or QE1 part 2.</span></p> <p><u><strong>The point is that the Fed has essentially trapped itself into a state of perpetual manipulation.</strong></u></p> <p>This is what Wall Street doesn&rsquo;t understand. It&rsquo;s still operating from outdated assumptions on how the business cycle works.</p> <p><strong>Those on Wall Street continue to have models that build according to the old reality, not the new one.</strong></p> <p><span style="font-weight: 400;">The reality is that the market is fundamentally set up for a fall. The fact is that the </span><a href="https://dailyreckoning.com/feds-road-ahead/" target="_blank"><span style="font-weight: 400;">Fed has no idea what it is doing</span></a><span style="font-weight: 400;">. I would expect a severe stock market correction coming sooner than later.</span></p> <p>While the Fed may act to try and bail out the stock market and Wall Street again, they&rsquo;re not going to be bailing out you and me.</p> <p><strong><em>Now is the time to increase your allocations to cash, gold, silver and U.S. Treasuries.</em></strong></p> <p><strong><em>Preparing now will offer the best insurance position in the wake of the coming crash.</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="775" height="401" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170625_rick.jpg?1498410810" /> </div> </div> </div> http://www.zerohedge.com/news/2017-06-25/get-ready-qt1-first-look-feds-hidden-policy#comments Auto Sales Business Economy ETC Excess reserves Federal Open Market Committee Federal Reserve Federal Reserve System Interest rate Macroeconomics Monetary Policy Monetary policy Money Money creation Money Supply Money supply Quantitative easing Reality Recession Recession US Federal Reserve Sun, 25 Jun 2017 19:30:00 +0000 Tyler Durden 598622 at http://www.zerohedge.com Epic Pictures From Arizona's Heatwave: "Everything Is Literally Melting" http://www.zerohedge.com/news/2017-06-25/epic-pictures-arizonas-heatwave-everything-literally-melting <p>Ask any Arizonan whether their summers are more tolerable because <strong>"it's a dry heat" </strong>and you're likely to be asked to <strong>turn your oven to 150 degrees, stick your head inside for 20 minutes and report back as to whether or not the humidity within the oven ever crossed you mind.</strong>&nbsp; Probably not. </p> <p>And while Arizonans have learned to cope with the "dry heat," this summer has been particularly brutal for people living in the Southwest as temperatures have already soared to over 120 degrees in certain areas.&nbsp; <strong>What's worse, it's only June.</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25 - AZ5.JPG"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25%20-%20AZ5_0.JPG" style="width: 600px; height: 461px;" /></a></p> <p>And while the heatwave may not be that fun for the people living through it, it does making for some amazing pictures of stuff melting.</p> <p>Perhaps that <strong>plastic mailbox post wasn't such a great idea in retrospect.</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25 - AZ1.JPG"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25%20-%20AZ1_0.JPG" style="width: 600px; height: 450px;" /></a></p> <p>&nbsp;</p> <p>On the bright side, you can get all your baking done outside in mother nature's free oven.</p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">"arizona isn't that hot"</p> <p>BET <a href="https://t.co/BjX2Me0Ezm">pic.twitter.com/BjX2Me0Ezm</a></p> <p>— antonihoe (@confuzzledteen3) <a href="https://twitter.com/confuzzledteen3/status/878049519161688064">June 23, 2017</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>&nbsp;</p> <p><strong>Plastic fences...also not a great idea</strong>.&nbsp; Come on Arizona...you're better than this.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25 - AZ2.JPG"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25%20-%20AZ2_0.JPG" style="width: 600px; height: 366px;" /></a></p> <p>&nbsp;</p> <p>Meanwhile, this Tempe resident (undoubtedly an ASU student judging by all the cheap alcoholic beverages) was just trying to do his part to fight climate change by recycling his beer bottles...<strong>it seems that ManBearPig won this round.&nbsp; </strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25 - AZ3.JPG"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25%20-%20AZ3_0.JPG" style="width: 600px; height: 605px;" /></a></p> <p>&nbsp;</p> <p>Breakfast is served...</p> <blockquote class="twitter-video"><p dir="ltr" lang="en">You already know whats going on in Arizona <a href="https://t.co/Pztyd03Vx3">pic.twitter.com/Pztyd03Vx3</a></p> <p>— ? ??c??d? ? (@Finessegawd3000) <a href="https://twitter.com/Finessegawd3000/status/877306917541994496">June 20, 2017</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>&nbsp;</p> <p>Meanwhile, even the road signs are melting down...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25 - AZ4.JPG"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25%20-%20AZ4_0.JPG" style="width: 600px; height: 393px;" /></a></p> <p>&nbsp;</p> <p>...which is going to make it even harder for this guy to get around town...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25 - AZ6.JPG"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/06/25/2017.06.25%20-%20AZ6_0.JPG" style="width: 600px; height: 415px;" /></a></p> <p>&nbsp;</p> <p>Al Gore is going to have a field day with these pics.</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="652" height="98" alt="" src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017.06.25%20-%20AZ%20Tease.JPG?1498405454" /> </div> </div> </div> http://www.zerohedge.com/news/2017-06-25/epic-pictures-arizonas-heatwave-everything-literally-melting#comments Arizona Arizonan Chemistry Environment Manufacturing Matter Polyethylene terephthalate Twitter Twitter Sun, 25 Jun 2017 19:00:00 +0000 Tyler Durden 598616 at http://www.zerohedge.com Is This Uber's "Theranos Moment"? http://www.zerohedge.com/news/2017-06-25/ubers-theranos-moment <p><a href="https://markstcyr.com/2017/06/24/ubers-theranos-moment/"><em>Authored by Mark St.Cyr,</em></a></p> <p>There comes that moment where the veiled threats against logic such as the go-to <strong>excuse of &ldquo;it&rsquo;s different this time&rdquo; are exposed against the harsh light of reality</strong> for all to see with such clarity, &ldquo;it&rsquo;s different this time&rdquo; is precisely the apt statement to show why it was all fallacy to begin with.</p> <p><strong>Uber&trade; has just had that moment, and the resulting fallout as I&rsquo;ve iterated before: Will. Be. Legend.</strong></p> <p>To think, let alone, believe that the current implosion (and yes, I mean implosion) will be isolated within Uber is as much of a fantasy as was believing: &ldquo;it&rsquo;s different this time.&rdquo; Why? Because: It is precisely that.</p> <p><strong>I believe (and have written) the remaining unicorns along with entire &ldquo;tech&rdquo; or &ldquo;Valley&rdquo; model for valuation are now facing what I called,&nbsp;<a href="http://www.zerohedge.com/news/2017-04-17/unicorns-watch-horror-uber-careens-towards-extinction-event-down-round">&ldquo;an extinction event.&rdquo;</a>&nbsp;</strong>Or said differently: The moment Uber is made to state publicly its current valuation going forward? It&rsquo;ll be the&nbsp;equivalent<span style="letter-spacing: .05em;">&nbsp;for both &ldquo;The Valley&rdquo; and &ldquo;unicorn&rdquo; metric modeling &ndash; as was for the dinosaurs. e.g., Stick a fork in it, it&rsquo;s done.</span></p> <p><strong>Now to be fair Theranos&trade; was/is caught up in what has been deemed as fraud for their product offering, Uber is not.</strong> However, why I use the &ldquo;moment&rdquo; appraisal is this: Once it was shown that the whole &ldquo;so worth it&rdquo; valuation metric was no longer above reproach? The jumping-of-ship for those closest happened so fast even rats took notice.</p> <p><img height="254" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_theranos_0.jpg" width="600" /></p> <p><strong>Ms. Holmes publicly declared any, and all, accusations as false before finally having to recant in the form of pulling, or re-verifying prior testing results. </strong>But as she was doing that publicly, quietly many either working for, or involved in management were reported to be heading towards any and all exits.&nbsp;<a href="https://www.forbes.com/sites/matthewherper/2016/06/01/from-4-5-billion-to-nothing-forbes-revises-estimated-net-worth-of-theranos-founder-elizabeth-holmes/#2e3304a63633">Then, precisely one year ago this week</a> (yes, it&rsquo;s the anniversary) Forbes&trade; revised, and declared Ms. Holmes net worth had gone from $4.5 BILLION &ndash; To Nothing. And just like that it was over almost as fast as it had began.</p> <p>So exactly where is the equivocation argument? Good question, and it is this:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><u><em><strong>The revising of valuations and more came when suddenly everyone no-longer could justify the valuations based on &ldquo;it&rsquo;s different this time&rdquo; arguments.</strong></em></u></p> </blockquote> <p>That argument works fine when the Fed&rsquo;s QE program is in full effect and works like some magical cloak to hide the naked fallacy&nbsp;that a company with less than $100 Million in revenues is worth some $9 BILLION because the VC&rsquo;s invested say it is. (I can&rsquo;t help myself from laughing as I typed that, it&rsquo;s so far beyond ludicrous.)</p> <p><strong>But once the term &ldquo;law suits&rdquo; and more get thrown across a unicorns saddle?&nbsp;Let&rsquo;s just say &ndash; viewpoints, and valuation metrics begin to change, and change quickly.</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>Uber is currently valued via all reports at around $68 BILLION dollars. </strong>And with that valuation it is currently the #1 unicorn, and most valued startup, and private tech company, in the world. <strong>And it&rsquo;s core product? It&rsquo;s an app to hail a cab.</strong></p> </blockquote> <p><u><strong>Re-read the above line a few times, and let it sink in.</strong></u> Because as I implied earlier &ndash; this is where the equivocation moment comes. e.g., When all-hype suddenly meets law suits? All, and I mean just that &ndash; all &ndash; perspective changes. Especially for those of the unicorn variety.</p> <p>Theranos, for all that it was going through at that time, one could argue (<a href="http://www.zerohedge.com/news/2016-07-02/silicon-valley-snake-oil">and some did making snake-oil salesmen look trustworthy</a>) that there was at least some possible future if the law suits turned out to be defendable, or were misplaced. After all, it was about patented machines, diagnosis, and more. Nevertheless &ndash; it was over with near immediacy once it was blatantly obvious people once loyal and intimately involved, along with companies using the service publicly began jumping ship.</p> <p>Suddenly every &ldquo;news&rdquo; outlet that once couldn&rsquo;t get a flattering story out quick enough tripped all over themselves to re-write the now how, and why, for the imminent collapse of the once storied unicorn.</p> <p><strong>This time &ndash; is no different, <a href="http://www.cnbc.com/2016/06/08/ubers-66-billion-valuation-may-ride-on-shaky-foundation.html">for the stories have already begun</a>. Again, once the unquestionable becomes questioned? I believe you already know the answer. But if you need reminding &nbsp;&ndash; again &ndash; just look to Theranos.</strong></p> <p>Now, much like Ms. Holmes, the founder and CEO had to quit, or resign, to appease those calling for change. And, much like the previous example &ndash; <a href="https://www.usatoday.com/story/tech/news/2017/06/21/uber-benchmark-bill-gurley-matt-cohler/103091246/">those closest, and who should be the greatest ally for change and stay as to help weather out the storm are also jumping</a>. Sound familiar?</p> <p>The optics of such a &ldquo;jump&rdquo; while in the midst of such a sh*t-storm at Uber, from my perspective, shows only one thing: You know the jig is up, it&rsquo;s all about managing the fall, and there&rsquo;s no need to do that in plain view.</p> <p>If I&rsquo;m wrong, then why would such a staunch defender of the company and its CEO resign when the negative optics of such a move are clearly visible? Unless? See above.</p> <p><strong>And just like Theranos &ndash; <a href="https://techcrunch.com/2017/06/22/as-ubers-value-slips-on-the-secondary-market-lyfts-is-rising/">Uber&rsquo;s valuation has already began slipping</a>.</strong></p> <p>The real difference here? <strong><em>Remember: Theranos was said to be worth $9 Billion when their fall from grace began. And that was all based upon the idea that they were involved in life changing medical technology. Uber? They are said to be worth $68 BILLION &ndash; and they&rsquo;re an app to hail a cab. Think about that, again.</em></strong></p> <p><strong>And lest one forget &ndash; <a href="http://www.zerohedge.com/news/2017-04-14/cash-burning-machine-uber-opens-its-books-shows-staggering-losses">Uber burns through, not makes: $BILLIONS</a>. </strong>And its &ldquo;world domination&rdquo; thesis has already been cleaved when it gave up on China. And that realization alone has yet to be priced in, or out, one might say. Add to that just some of the above and &ldquo;cleave&rdquo; might be an understatement for future valuation adjustments going forward.</p> <p>Just ask Ms. Holmes.</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="1121" height="475" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170625_theranos.jpg?1498409163" /> </div> </div> </div> http://www.zerohedge.com/news/2017-06-25/ubers-theranos-moment#comments A Business China Economy Neologisms Reality Theranos Transport Uber Unicorn US Federal Reserve Valuation Sun, 25 Jun 2017 18:30:00 +0000 Tyler Durden 598619 at http://www.zerohedge.com "Boo Hoo Hoo" - New Jersey College Fires Black Professor For Making Racist Remarks http://www.zerohedge.com/news/2017-06-25/new-jersey-college-fires-black-professor-making-raciall-insensitive-remarks <p>Essex County College in New Jersey has fired adjunct professor Lisa Durden after she made racially insensitive remarks during an interview with Tucker Carlson on Fox News two weeks ago, <a href="http://apnews.com/950d744e34884c1a9e2011542fcfe947">according to the Associated Press.</a> College officials said they received complaints about Durden&rsquo;s interview, with some university constituents upset about statements that were disparaging to white people. <strong>During the interview, Durden, who is black, discussed a Memorial Day event held exclusively for black people hosted by a Black Lives Matter group. </strong></p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/dsRyYr7XuVI" width="560"></iframe></p> <p>When <a href="http://www.youtube.com/watch?v=dsRyYr7XuVI#action=share">Carlson asked Durden for her thoughts,</a> she interrupted the host, saying: <em><strong>&ldquo;Boo hoo hoo. You white people are angry because you couldn&rsquo;t use your white privilege card&rdquo;</strong></em> to attend the event. The show aired June 6, and the school suspended Durden with pay two days later. She addressed the matter during a public meeting Tuesday with school officials, but was soon fired, <a href="https://apnews.com/950d744e34884c1a9e2011542fcfe947">according to the AP. </a></p> <p>In a statement from College President Dr. Anthony E. Munroe obtained by <a href="http://dailycaller.com/2017/06/23/college-that-suspended-prof-over-heated-tucker-segment-issues-statement/">the Daily Caller,</a> Munroe quoted Dr. Martin Luther King Jr. and said he&rsquo;s committed to maintaining a welcoming environment for people of all races. He added that the school will be forming a committee devoted to making students of all backgrounds feel welcome.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&ldquo;Munroe said that in light of these events he wanted to assure the public that Essex is committed to <strong>&ldquo;maintaining a welcoming environment to all students from a variety of races,&rdquo; even&nbsp;quoting Martin Luther King and then adding, &ldquo;racism cannot be fought with more racism.&rdquo;</strong></p> <p>&nbsp;</p> <p>The school will be forming a committee devoted to &ldquo;unity in diversity&rdquo; with the aim of helping students of all backgrounds to feel welcome, including those who identify as white, he said.&rdquo;</p> </blockquote> <p>Munroe added that while the school respects first amendment freedoms, he believes the &ldquo;health and wellbeing&rdquo; of students supersedes many of these concerns.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&quot;Munroe addressed first amendment concerns in the statement that have arisen over&nbsp;Durden&rsquo;s suspension,<strong> saying the school values free speech and academic freedom, but believes that the &ldquo;health and well being&rdquo; of students trumps any personal views held by an adjunct. </strong></p> <p>&nbsp;</p> <p>He said the college also rejects &ldquo;any conduct that implies that all students are not welcome to participate in, <strong>or benefit from, our program or activities on the basis of their race, color, orientation or national origin.&rdquo;</strong></p> </blockquote> <p>Durden, meanwhile, claims that her firing was tantamount to being <strong>&ldquo;publicly lynched&rdquo;</strong> and compared her treatment by the school to a rape victim being blamed for their assault, <a href="https://apnews.com/950d744e34884c1a9e2011542fcfe947">the AP reports.</a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&ldquo;Durden told NJ.com on Friday that she has received a lot of support from school staff members and students, but compared her experience to a rape victim who is blamed for the crime, and a person who returns from war to a hostile environment.&quot;</p> </blockquote> <p>Unsurprisingly, she is already lawyering up:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&quot;Durden&rsquo;s attorney, Leslie Farber, said she believes her client&rsquo;s free speech rights were violated. Farber said they were considering whether to take legal action in the matter.</p> <p>&nbsp;</p> <p>I fully believe that institutions of higher learning must provide a safe space for students to explore, discuss and debate, not only academic philosophies, but the harder issues related to living harmoniously and growing together in our communities and as a country,&rdquo; Munroe wrote in a statement announcing the firing. <strong>&lsquo;The character of this institution mandates that we embrace diversity, inclusion, and unity. Racism cannot be fought with more racism.&rsquo;&rdquo;</strong></p> </blockquote> <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="1629" height="800" alt="" src="http://www.zerohedge.com/sites/default/files/images/user245717/imageroot/professor.JPG?1498400975" /> </div> </div> </div> http://www.zerohedge.com/news/2017-06-25/new-jersey-college-fires-black-professor-making-raciall-insensitive-remarks#comments Black Lives Matter County College Durden Education Essex County College Essex County College First Amendment Fox News Politics Race and society Racism Social Issues Structure Sun, 25 Jun 2017 18:00:00 +0000 Tyler Durden 598610 at http://www.zerohedge.com Perfect Storm 2.0 - Will The Auto Industry Ever Be The Same Again? http://www.zerohedge.com/news/2017-06-25/perfect-storm-20-will-auto-industry-ever-be-same-again <p dir="ltr"><em><a href="http://blindersoffllc.blogspot.bg/2017/06/the-perfect-storm-2-autonomics-by.html?m=1">Authored by Daniel Ruiz via Blinders Off blog,</a></em></p> <p dir="ltr">To better understand <strong>why the automotive industry is in the middle of a <a href="http://blindersoffllc.blogspot.com/2017/05/used-vehicle-values-foundation-for.html">perfect storm</a>,</strong> first go back and consider the also perfect set of events that led to a robust recovery and a record setting 2016 sales year.</p> <h3 dir="ltr"><u>Our Last Recession</u></h3> <p dir="ltr">In 2009, the automotive industry faced a great challenge. New light vehicle sales dropped to 10.4 million, GM and Chrysler went through bankruptcy reorganizations, retail dealers closed and many folks lost their jobs. <strong>The US &nbsp;government felt the need to act in order to support the very vital automotive industry (3% of GDP &amp; 10% of manufacturing). The Fed also stepped in to help stimulate the overall economy by reducing interest rates.</strong></p> <h3><u>Consumer Purchasing Power</u></h3> <p dir="ltr"><span id="docs-internal-guid-629c3165-d9fa-610b-f424-2c17c443f751">For the purpose of this piece, the central focus will be placed on the purchasing power of the consumer. With no bottom in sight for falling new vehicle sales, our government attempted to stimulate demand by approving the 3 billion dollar <a href="https://en.wikipedia.org/wiki/Car_Allowance_Rebate_System">Cash for Clunkers</a> program beginning on July 1, 2009. Consumers received as much as $4,500 for trade vehicles that qualified for &ldquo;clunker&rdquo; status. The trade value of $4,500 represented a $75-$90 reduction in monthly payment on a 60 month loan assuming good credit. The program would run until a specific end date or until the total approved funds ran out. Consumers responded very well to the stimulus and sales spiked sharp for a brief period till the program ended on August 24, 2009. <strong>This program also had an impact on the supply of used vehicles since all qualifying trades were destroyed as part of the transaction.</strong></span></p> <p dir="ltr"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars1.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars1.jpg" style="width: 560px; height: 370px;" /></a></p> <p dir="ltr">In December of 2008, the Fed also stepped in to stimulate the overall economy by lowering interest rates to a historic low between 0-.25%. In the following years, the 0% auto loan became the norm. Zero percent loans significantly boost consumer purchasing power by providing monthly payments of only $16.66 and $13.88 per thousand financed for 60 and 72 months respectively. These two forms of stimulus also had residual effects that further boosted sales volume and auto price inflation.</p> <p dir="ltr"><strong>After the recession ended and demand returned, used vehicle values made strong and steady gain</strong>s from 2009 till 2011 and peaked in 2014<strong> due to a supply shortage, lower interest rates and increased demand from subprime borrowers after many folks damaged their personal credit by defaulting on a variety of loans.</strong></p> <p dir="ltr"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars2.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars2_0.png" style="width: 560px; height: 368px;" /></a></p> <p dir="ltr">This period of strong used vehicle value performance resulted in very short trade cycles, which significantly boosted new vehicle sales velocity. To illustrate this, consider this chart of a 60-month loan on a Toyota Camry. The black line represents the principal balance owed. An optimal trade cycle occurs when the principal balance owed on a loan intersects with the market value of the vehicle. The black dotted line is representation of peak used passenger vehicle values. Note how quickly the value line crosses the principal balance line.<strong> Those who kept their vehicles slightly longer, found themselves with equity in their trades which further boosted their purchasing power.&nbsp;</strong></p> <p dir="ltr"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars3.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars3_0.png" style="width: 560px; height: 332px;" /></a></p> <p dir="ltr"><span id="docs-internal-guid-629c3165-d9fd-5efb-d6ac-fa18043465eb"><strong>However, nothing gave consumers more purchasing power than leasing during this time period.</strong> Higher used vehicle values led to higher residual values. &nbsp;The most impactful portion of a lease is the gap between the sale price of a vehicle and the residual value. I&rsquo;ve personally witnessed leases that boosted consumer buying by producing monthly payments that required as little as $10.00 per thousand of a vehicle&rsquo;s MSRP. As a result, leasing became more and more popular with 2016 setting a lease penetration record.</span></p> <p dir="ltr"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars4.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars4.jpg" style="width: 560px; height: 287px;" /></a></p> <h3 dir="ltr"><u>Asset Price Inflation</u></h3> <p dir="ltr"><strong>The stimulating effects of all the items listed above have created significant auto price inflation. </strong>The average new vehicle transaction price in 2008 was $28,350 and has increased to $35,309 in 2017 (24.5% inflation) while the <a href="https://fred.stlouisfed.org/series/MEHOINUSA646N">median household income</a> has increased by only 12.3% as of 2015. (Data for 2016 will be available in September of this year.) Some segments have inflated even more as shown below:</p> <p dir="ltr"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars5.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars5_0.png" style="width: 560px; height: 255px;" /></a></p> <p dir="ltr">The price of a new Chevrolet Tahoe LT 4WD was $39,560 in 2008. Today, the price of that vehicle has inflated by 40.1% to $55,455. &nbsp;<strong>The highest trim level has inflated by an astounding 64.6%.</strong></p> <p dir="ltr"><span id="docs-internal-guid-629c3165-d9ff-2bf6-7073-ac495994728a">However, the 0% loans could only take us so far. The <strong>effect of ultra low lease payments due to abnormally high residual values helped to further inflate the value of new vehicle prices above and beyond what 0% loans could achieve. </strong>Here&rsquo;s a look at the vehicle most often leased from the manufacturer with the highest lease penetration ratio. The Infiniti G37, now known as the Q60, has inflated in price by 43.8% since 2008.</span></p> <p dir="ltr"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars6.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars6_0.png" style="width: 560px; height: 253px;" /></a></p> <p dir="ltr"><span><strong>Once the price of a new vehicle gets so high that even 0% loan for 72 months no longer makes it affordable, the customer can &nbsp;simply be converted to a lease to keep the sales moving. </strong>This is very evident today as manufacturers have become more and more dependent on leasing.</span></p> <p dir="ltr"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars7.png" style="width: 560px; height: 710px;" /></p> <h3 dir="ltr"><u>Why The Perfect Storm</u></h3> <p dir="ltr"><strong>The automotive industry needed every single ingredient listed above to reach last year&rsquo;s record setting sales number.</strong> However, something has changed.</p> <p dir="ltr">Well, in reality, <u><strong>everything has changed</strong></u>. The set of ingredients that perfectly fueled the recovery have all reversed and now power the <strong>perfect storm</strong>:</p> <ol> <li> <p>Interest rates are rising. It&rsquo;s getting harder and more expensive for manufacturers to subvent (buy down as a form of incentive) interest rates.</p> </li> <li> <p>Used vehicle prices are falling and will continue to fall. Falling used vehicle values prolong the negative equity period (elongated trade cycles) limiting the buying power of the consumer slowing the velocity of new vehicle sales.</p> </li> <li> <p>The last is the most dangerous of all. Residuals values, which lag used vehicle values, are adjusting and will continue to adjust lower.</p> </li> </ol> <p dir="ltr"><strong><em>What will happen when the new vehicle prices that have inflated beyond the affordability of 0% loans are no longer supported with the buying power that leasing provides? What will happen to the sales volume of the above manufacturers that rely on leases for more than 50% of their total sales?</em></strong></p> <p dir="ltr"><u><strong>Allow me to answer&hellip;</strong></u> &nbsp;Inventory at dealers will begin to backup. We will start witnessing big discounts from manufacturers that keep rising in effort to control a rising day supply problem because new vehicles will &nbsp;no longer be affordable. Incentives will stop working because as the price of the new vehicle is reduced, it will simultaneously put downward pressure on the trade value of the 1-3 year-old version of the vehicle. Production might slow or stop for a period of time, but it won&rsquo;t change the fact that new vehicle prices will have inflated beyond the buying power of the consumer.</p> <p dir="ltr">Utilize the same Chevrolet Tahoe from the chart above to illustrate:</p> <p dir="ltr"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars8.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars8_0.png" style="width: 560px; height: 539px;" /></a></p> <p dir="ltr">Note how the 0% loan today after price inflation is 19% higher than the standard rate loan before inflation ($643 vs $770) and 28% higher than the 0% loan ($554 vs $770). Interest rates are currently rising. If the same standard rate with today&rsquo;s price is used, the monthly payment will be 38.7% higher ($643 vs $892) than where it started before the stimulus.</p> <h3 dir="ltr"><u>Did Manufacturers Fail to Sufficiently Advance Technology?</u></h3> <p dir="ltr"><strong>Nothing can be more disruptive to an industry than newer and better technology offered at a lower price. </strong>New technology goes through a process of consumer behavior and price changes. To date, consumers have welcomed the technology from Tesla, leaving price as the next barrier or chasm to mass-market adoption. We are only months away from what I believe will be the introduction of a mass-market electric vehicle. The chart below illustrates the progression of Tesla as a car company through the process of Rogers&rsquo; Diffusion of Innovation.</p> <p dir="ltr"><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars9.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_cars9_0.png" style="width: 560px; height: 392px;" /></a></p> <p dir="ltr">It&rsquo;s important to note that the $7,500 electric vehicle rebate is included in the estimated payments above and will be a significant factor in the demand for the Model 3. The rebate equates to $193 in monthly payments on the scenarios listed above.<strong> If the rebate remains, I challenge you to consider the timing of this new model&rsquo;s introduction.</strong> Over the next year, new vehicles will become more expensive (in regards to monthly payments) due to rising interest rates and falling residual values. <strong>The model 3 will then be offered to the public at this time and will represent the newest technology at a lower price (again, payments).</strong> The timing of these events might force new vehicle manufacturers to compete in the electric vehicle market sooner than expected, but I believe that Tesla has a commanding technological lead in this segment.</p> <h3 dir="ltr"><u>Will The Auto Industry Ever Be The Same?</u></h3> <p dir="ltr"><strong>I believe that we will witness significant changes in the way that we purchase our vehicles after the downturn that I expect in the auto industry. </strong>Profits for manufacturers and retail dealers will fall significantly in the coming years. As I write this, dealer groups are investing in more and more retail storefronts. Falling new vehicles sales will mean more dealers competing for fewer customers. This sales environment will lead to massive margin compression and newer entries may not survive.<strong> Both manufacturers and retail dealers will be forced to reconsider the cost structure of their business</strong> to better compete with companies like Tesla which have a much lower cost of distribution.</p> <p dir="ltr"><strong>Something that&rsquo;s very different today than it was during our last recession is the ability for companies to replace or reduce the size of their workforce with technological alternatives.</strong> I believe that when the smoke clears, manufacturers and dealers will adopt a much more cost-effective way of retailing new vehicles to the public. <strong>This will have a negative impact on both the quantity of jobs and wage growth in the automotive sector</strong>.</p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/TpEPb6Jbv_Y" width="560"></iframe></p> <p><em>For investors, please consider that everything stated is actively measured. The value of my service is the ability to confirm the statements made far ahead of monthly, quarterly and annual data releases.</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="637" height="421" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170625_cars1.jpg?1498407813" /> </div> </div> </div> http://www.zerohedge.com/news/2017-06-25/perfect-storm-20-will-auto-industry-ever-be-same-again#comments Business Car dealerships in North America Cash For Clunkers Chrysler Economy Electric vehicles Fail Inflation Leasing Purchasing Power Reality Rebate Recession recovery Toyota Transport US Federal Reserve US government Value Line Vehicle leasing Sun, 25 Jun 2017 17:25:00 +0000 Tyler Durden 598617 at http://www.zerohedge.com Spot The Odd One Out: Hillary & Losing Presidential Candidates' Ratings Edition http://www.zerohedge.com/news/2017-06-25/spot-odd-one-out-hillary-losing-presidential-candidates-ratings-edition <p>Many have defined Hillary Clinton as &#39;unique&#39;, a &#39;one off&#39;, or &#39;special&#39; and now we have confirmation. Over the past quarter century, the <strong>favorability ratings of losing presidential candidates generally have increased after the election</strong>, however, <a href="http://www.gallup.com/poll/212705/hillary-clinton-unique-no-post-election-image-gain.aspx?utm_source=twitterbutton&amp;utm_medium=twitter&amp;utm_campaign=sharing">as Gallup&#39;s latest poll shows</a>, <strong>seven months after her failed bid for the presidency, she remains as unpopular now as she was then</strong>.</p> <p><strong>Typically, losing candidates&#39; favorable ratings improve </strong>because political independents and supporters of the opposing political party grow to view the candidate more positively after the election.</p> <p><strong>However, this has not happened for Clinton.</strong> Her current ratings among Republicans (11%) and independents (33%) are just as low now as last November before she lost to Trump. Democrats maintain a mostly positive view of Clinton, with 79% viewing her favorably.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170624_loser.jpg"><img height="455" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170624_loser_0.jpg" width="600" /></a></p> <p>&nbsp;</p> <p><a href="http://www.gallup.com/poll/212705/hillary-clinton-unique-no-post-election-image-gain.aspx?utm_source=twitterbutton&amp;utm_medium=twitter&amp;utm_campaign=sharing"><u><strong>Gallup&#39;s Bottom Line</strong></u></a></p> <p>November&#39;s election was unlike any other before it, with <strong>both major party candidates having some of the&nbsp;<a href="http://www.gallup.com/poll/193376/trump-leads-clinton-historically-bad-image-ratings.aspx?g_source=scalometer&amp;g_medium=search&amp;g_campaign=tiles">lowest favorable ratings of any candidates</a></strong>&nbsp;in Gallup&#39;s history. This situation has had unique consequences for the losing candidate as well as the winner.</p> <p><strong>Seven months after her loss, Clinton&#39;s image remains near its record low since 1992 -- even though prior losing candidates&#39; images improved after their defeats</strong>. Trump, like previous winners, did get an&nbsp;<a href="http://www.gallup.com/poll/201977/trump-pre-inauguration-favorables-remain-historically-low.aspx">increase in favorability</a>&nbsp;shortly after his win, though his current 40% favorable rating remains low in an absolute sense.</p> <p>Some <strong>former Clinton supporters have been openly resentful of the failed candidate, calling her toxic and divisive,</strong> and unhelpful in any efforts to resist Trump and his agenda. Republicans, meanwhile, haven&#39;t softened to Clinton in the way they did to Gore after his 2000 loss, or the way Democrats did to Romney and McCain. To some degree, that may be an outcome of the increasingly partisan political environment, but it may also reflect Republicans&#39; long-held and deep-seated antipathy toward Clinton.</p> <p>At this point, then,<strong> it is unclear when or if Clinton&#39;s image will recover.</strong> Americans have liked Clinton most when her role was less political -- such as secretary of state or first lady weathering her husband&#39;s public scandal -- and her ratings have suffered each time she has run for office. If she doesn&#39;t seek to run again, her favorability is far less relevant and frees her from the constraints of public opinion.</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="884" height="670" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170624_loser.jpg?1498403480" /> </div> </div> </div> http://www.zerohedge.com/news/2017-06-25/spot-odd-one-out-hillary-losing-presidential-candidates-ratings-edition#comments American Presbyterians Bill Clinton DeWitt Clinton Donald Trump Gallup Hillary Clinton New York Politics ratings Rodham family United States Sun, 25 Jun 2017 16:57:02 +0000 Tyler Durden 598614 at http://www.zerohedge.com Obama Ordered Cyberweapons Implanted Into Russia's Infrastructure http://www.zerohedge.com/news/2017-06-25/obama-ordered-cyberweapons-implanted-russias-infrastructure <p><a href="http://news.antiwar.com/2017/06/23/obama-ordered-cyberweapons-implanted-into-russias-infrastructure/"><em>Authored by Jason Ditz via AntiWar.com,</em></a></p> <p>A<a href="https://www.washingtonpost.com/graphics/2017/world/national-security/obama-putin-election-hacking/?tid=a_classic-iphone&amp;utm_term=.c5d304219896"> new report from the Washington Post today quoted a series of Obama Administration officials</a> reiterating their official narrative on Russia&rsquo;s accused hacking of the 2016 election. While most of the article is simply rehashes and calls for sanctions, they also <strong>revealed a secret order by President Obama in the course of &ldquo;retaliation&rdquo; for the alleged hacking.</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_russia1.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_russia1.jpg" style="width: 600px; height: 322px;" /></a></p> <p>This previously secret order involved having <strong>US intelligence design and implant a series of cyberweapons into Russia&rsquo;s infrastructure systems</strong>, with <strong>officials saying they are meant to be activated remotely to hit the most important networks in Russia and are designed to &ldquo;<a href="https://www.usatoday.com/story/news/2017/06/23/obama-ordered-u-s-intelligence-agency-deploy-implants-russian-network-response-kremlin-hacking/422818001/">cause them pain and discomfort</a>.&rdquo;</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>The implants, developed by the NSA, are <strong>designed to hit Russian networks deemed &ldquo;important to the adversary and that would cause them pain and discomfort if they were disrupted,&rdquo;</strong> a former U.S. official told the Post.</p> <p>&nbsp;</p> <p>They could be activated in the event that Russia attacked a U.S. power grid or interfered in a future U.S. presidential race.</p> </blockquote> <p>The <strong>US has, of course, repeatedly threatened &ldquo;retaliatory&rdquo; cyberattacks against Russia,</strong> and promised to knock out broad parts of their economy in doing so. These appear to be the first specific plans to have actually infiltrate Russian networks and plant such weapons to do so.</p> <p>Despite the long-standing nature of the threats, by the end of Obama&rsquo;s last term in office this was all still in the &ldquo;planning&rdquo; phases. It&rsquo;s not totally clear where this effort has gone from there, but<strong> officials say that the intelligence community, once given Obama&rsquo;s permission, did not need further approval from Trump</strong> to continue on with it, and he&rsquo;d have actually had to issue a countermanding order, something they say he hasn&rsquo;t.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&quot;U.S. <strong>intelligence agencies do not need further approval from (President) Trump, </strong>and officials said that he would have to issue a countermanding order to stop it,&quot; the Post reported.</p> <p>&nbsp;</p> <p>&quot;The officials said that they have seen no indication that Trump has done so.&quot;</p> </blockquote> <p><strong>The details are actually pretty scant on how far along the effort is</strong>, but the goal is said to be for the US to have the ability to retaliate at a moment&rsquo;s notice the next time they have a cyberattack they intend to blame on Russia.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_russia.jpg"><strong><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/06/22/20170625_russia.jpg" style="width: 601px; height: 312px;" /></strong></a></p> <p>Unspoken in this lengthy report, which quotes unnamed former Obama Administration officials substantially, advocating the effort, is that in <strong>having reported that such a program exists, they&rsquo;ve tipped off Russia about the threat.</strong></p> <p>This is, however, reflective of the <strong>priority of the former administration</strong>, which is<strong> to continuing hyping allegations that Russia got President Trump elected</strong>, a priority that&rsquo;s high enough to <strong><u>sacrifice what was supposed to be a highly secretive cyberattack operation.</u></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="691" height="359" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170625_russia.jpg?1498404350" /> </div> </div> </div> http://www.zerohedge.com/news/2017-06-25/obama-ordered-cyberweapons-implanted-russias-infrastructure#comments American people of German descent Business Climate change skepticism and denial Donald Trump Obama Administration Politics of the United States Presidency of Barack Obama President Obama The Apprentice U.S. intelligence United States WWE Hall of Fame Sun, 25 Jun 2017 16:15:00 +0000 Tyler Durden 598615 at http://www.zerohedge.com