en North Korea Threatens "Nuclear Hammer" After CIA Proposes 'Regime Change' <p><a href=""><em>Via,</em></a></p> <p><em><img height="305" src="" width="600" /></em></p> <p>Less than a week after C.I.A. chief Mike Pompeo<a href="" rel="noopener" target="_blank">&nbsp;suggested</a>&nbsp;that regime change in North Korea would be a good thing for the Trump administration, the East Asian country said Tuesday it was ready and willing to strike the U.S. with a&nbsp;<em>&ldquo;nuclear hammer&rdquo;</em>&nbsp;if that proves to be the Trump team&rsquo;s agenda.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong><em>&ldquo;Should the U.S. dare to show even the slightest sign of attempt to remove our supreme leadership, we will strike a merciless blow at the heart of the U.S. with our powerful nuclear hammer, honed and hardened over time,&rdquo;</em></strong><a href="" rel="noopener" target="_blank">&nbsp;writes</a>&nbsp;state-run&nbsp;<em>Korean Central News Agency (KCNA)</em>, quoting a spokesman for the Foreign Ministry.</p> </blockquote> <p>Speaking at the Aspen Security Forum in Colorado on July 20, C.I.A. director<strong> Pompeo<a href="" rel="noopener" target="_blank">&nbsp;said</a>&nbsp;it would be&nbsp;<em>&ldquo;a great thing to denuclearize the peninsula, to get those weapons off of that, but the thing that is most dangerous about it is the character who holds the control over them today.&rdquo;</em></strong></p> <p>Continuing, Pompeo appeared to hint that there&rsquo;s a consensus within Washington, D.C. that ousting Kim Jong-un is something that&nbsp;<em>&ldquo;ultimately needs to be achieved&rdquo;</em>&nbsp;in order to combat the North Korean nuclear threat:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>&ldquo;So from the administration&rsquo;s perspective, the most important thing we can do is separate those two. Right? Separate capacity and someone who might well have intent and break those two apart.&rdquo;</em></p> </blockquote> <p>The C.I.A. director further stated that citizens of North Korea would be appreciative if Kim&rsquo;s finger was off the nuclear button:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>&ldquo;<u><strong>As for the regime, I am hopeful we will find a way to separate that regime from this system. </strong></u>The North Korean people I&rsquo;m sure are lovely people and would love to see him go.&rdquo;</em></p> </blockquote> <p>On that subject,&nbsp;<em>KCNA</em><a href="" rel="noopener" target="_blank">&nbsp;wrote</a>&nbsp;Tuesday that North Korea&rsquo;s&nbsp;<em>&ldquo;army and people have never thought about their destiny and future separated from their supreme leadership&rdquo;</em>&nbsp;and that the&nbsp;<em>&ldquo;first and foremost mission of our revolutionary armed forces with the nuclear force as their backbone is to defend the leader at the cost of their lives.&rdquo;</em></p> <p>The comments come at a time when the mainstream media is<a href="" rel="noopener" target="_blank">&nbsp;reporting</a>&nbsp;that North Korea could produce a nuclear-capable missile in far less time than previously estimated.</p> <p>As&nbsp;<em>Anti-Media</em>&nbsp;<a href="" rel="noopener" target="_blank">highlighted</a>&nbsp;last week, however, the second-highest ranking U.S. military official, vice chairman of the Joint Chiefs of Staff General Paul Selva,&nbsp;<a href="" rel="noopener" target="_blank">stated</a>&nbsp;recently that <strong>North Korea lacks&nbsp;<em>&ldquo;the capacity to strike the United States with any degree of accuracy or reasonable confidence of success.&rdquo;</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="717" height="365" alt="" src="" /> </div> </div> </div> C.I.A. Foreign Ministry International relations KIM Korea Korean Central News Agency Korean Central News Agency Mike Pompeo Military of North Korea North Korea North Korea–South Korea relations Nuclear program of North Korea Politics Trump Administration Washington D.C. Thu, 27 Jul 2017 14:07:14 +0000 Tyler Durden 600578 at Jeff Bezos Surpasses Bill Gates - Becomes World's Richest Man <p>A surge in&nbsp;Amazon shares this morning (ahead of earnings) has propelled founder&nbsp;Jeff Bezos&nbsp;past Microsoft founder Bill Gates&nbsp;as the<strong> world’s richest person</strong>...</p> <p><a href=""><img src="" width="600" height="285" /></a></p> <p>As Bloomberg reports, shares of the online retailer rose 1.8 percent to $1,071.31 as of 9:30 a.m. in New York. If the gains hold through the close, Bezos, 53, could leapfrog Gates on the&nbsp;Bloomberg Billionaires Index. <strong>The 61-year-old&nbsp;Microsoft Corp.&nbsp;co-founder has held the top spot since May 2013</strong>.</p> <p><strong>Bezos owns about 17 percent of Seattle-based Amazon, which has surged 40 percent this year through Wednesday, helping to add $24.5 billion to his net worth.</strong> He started 2017 as the world’s fourth-wealthiest person and has since leapfrogged Inditex SA founder&nbsp;Amancio Ortega, who ranks third with $82.7 billion, and Berkshire Hathaway Inc.’s&nbsp;Warren Buffett, No. 4, at $74.5 billion.</p> <p>Notably, <strong>Amazon and Facebook are now both worth over $500 billion market cap.</strong></p> <p><strong><a href=""><img src="" width="600" height="315" /></a></strong></p> <p><strong>And as far as what (or who) is behind the success of Bezos, it's simple...</strong></p> <p><a href=""><img src="" width="600" height="325" /></a></p> <p><strong>Central Bank policy truly means the rich get richest!<br /></strong></p> <p>So this means that "the leader of the free world" is now in a feud with "the world's richest man" - should be fun to see who wins that.</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="1148" height="545" alt="" src="" /> </div> </div> </div> Amancio Ortega Berkshire Hathaway Berkshire Hathaway Bill Gates Bill Gates Bloomberg Billionaires Blue Origin Business Business Computing Economy Economy of the United States Inditex Jeff Bezos Life extensionists Nerd culture Tau Beta Pi The World's Billionaires Universal Windows Platform apps Warren Buffett Warren Buffett Thu, 27 Jul 2017 13:44:45 +0000 Tyler Durden 600593 at Senate GOP Leader Says "Skinny" Obamacare Repeal Has "Best Chance At Getting Us To Conference" <p>Right on schedule, President Donald Trump is out with his latest tweet urging Republicans to pass health-care reform: &quot;Come on Republican Senators, you can do it on Healthcare. After 7 years, this is your chance to shine! Don&#39;t let the American people down!&quot;</p> <blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="en">Come on Republican Senators, you can do it on Healthcare. After 7 years, this is your chance to shine! Don&#39;t let the American people down!</p> <p>&mdash; Donald J. Trump (@realDonaldTrump) <a href="">July 27, 2017</a></p></blockquote> <script async src="//" charset="utf-8"></script><p><strong><em>* * *</em></strong></p> <p>Like they say, third time&#39;s the charm.</p> <p>President Donald Trump may have spoken too soon when he praised Senate Republicans as &ldquo;patriots&rdquo; who would swiftly put an end to the &ldquo;tyranny&rdquo; of Obamacare earlier this week after the chamber passed a crucial motion to proceed with a plan to repeal the controversial health-care law.</p> <p>But that plan, as well as the Senate&#39;s repeal-and-replace alternative, have now been rejected. So, with few options remaining, the Senate Republican leadership <strong>now believes its best chance of passing health-care reform by the end of the week lies with a so-called <a href="">&ldquo;skinny repeal&rdquo;</a> bill that was drafted last week.</strong></p> <p>Pundits seem to agree. <a href="">Goldman&rsquo;s Alec Phillips</a> believes there&rsquo;s a <strong>&ldquo;somewhat greater probability&rdquo;</strong> of skinny repeal passing, though he still thinks the most likely scenario would be a Republican surrender: &quot;We believe the status quo is more likely to be maintained,&quot; he said in a research note.</p> <p><a href=""><img alt="" src="" style="width: 500px; height: 350px;" /></a></p> <p>The skinny repeal bill would eliminate three of Obamacare&rsquo;s most controversial features: The individual and employee mandates, and the tax on medical devices. But its biggest advantage over the other two Republican options was unwittingly revealed by Democrats, who asked the CBO to score the bill.</p> <p>Turns out, a &ldquo;skinny&rdquo; Obamacare repeal <strong>would result in only 16 million people losing their insurance, compared with 22 million for the second draft of the Senate plan, and 32 million for full repeal,</strong> according to <a href="">the Hill.</a></p> <p>Majority whip John Cornyn, the No. 2 Republican in Senate leadership, told <a href="">the Hill</a> that skinny repeal could be Republicans&rsquo; best, and last, hope to unravel Obamacare. &nbsp;</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>&ldquo; Cornyn&hellip;told reporters Wednesday that a scaled-down bill might be the best way to move forward on the issue, possibly by holding a conference committee with the House, which approved a broader repeal-and-replace bill.&rdquo;</strong></p> <p>&nbsp;</p> <p>It <strong>&ldquo;seems to have a lot of benefits, getting us to conference,&rdquo;</strong> Cornyn said.</p> </blockquote> <p>According to <a href="">Reuters,</a> a draft of the skinny bill will be released at some point on Thursday, before the Senate &ldquo;embarks on a marathon voting session&rdquo; that could continue into Friday morning.</p> <p>The irony of this whole process is that, once Republicans muster the votes to pass a health-care bill, its contents, whether it&rsquo;s repeal and replace, or some variation of a repeal bill, won&rsquo;t matter all that much. Once the legislation clears the upper chamber, the Senate will form a conference committee with the House to draft an entirely new &ldquo;compromise&rdquo; bill. <strong>Then lawmakers will need to repeat the whole process, passing the final version of the legislation in the House, and then again in the Senate, before it lands on President Donald Trump&rsquo;s desk.</strong></p> <p>To be sure, the skinny bill might not be Republicans&rsquo; only alternative. According to <a href="">Reuters,</a> Democrats are accusing Majority Leader Mitch McConnell are drafting a fourth health-care reform plan in secret. Facing united opposition from Democrats, Republicans have failed to secure the minimum 50 votes needed to pass a bill (a 50-50 split would presumably lead to a tie-breaking vote by Vice President Mike Pence). <strong>With only a slim majority of 52-48, the leadership has struggled to placate both moderates, who oppose cuts to Medicaid, and conservatives, who criticized a senate plan they believed to be &ldquo;Obamacare-lite.&rdquo;</strong><br />&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="915" height="640" alt="" src="" /> </div> </div> </div> 115th United States Congress American Health Care Act American people of German descent American Presbyterians Barack Obama Continuing Appropriations Resolution Donald Trump Donald Trump Efforts to repeal the Patient Protection and Affordable Care Act Health Internal Revenue Code John Cornyn John Cornyn Mitch McConnell Obamacare Patient Protection and Affordable Care Act Patient Protection and Affordable Care Act replacement proposals Politics Politics Reuters Senate Social Issues Statutory law United States Thu, 27 Jul 2017 13:26:48 +0000 Tyler Durden 600576 at Are We There Yet? Here Is Howard Marks' "Bubble Checklist" <p>As first <a href="">reported yesterday</a>, in his latest nearly-30 page memo, a distinctly less optimistic Howard Marks - hardly known for his extreme positions - "sounded the alarm" on markets by laying out a plethora of reasons why investors should be turning far more cautious on the risk, and summarizing his current view on the investing environment with the following 4 bullet points:</p> <ul> <li>The uncertainties are unusual in terms of number, scale and insolubility in areas including secular economic growth; the impact of central banks; interest rates and inflation; political dysfunction; geopolitical trouble spots; and the long-term impact of technology.</li> <li>In the vast majority of asset classes, prospective returns are just about the lowest they’ve ever been.</li> <li>Asset prices are high across the board.&nbsp; Almost nothing can be bought below its intrinsic value, and there are few bargains.In general the best we can do is look for things that are less over-priced than others.</li> <li>Pro-risk behavior is commonplace, as the majority of investors embrace increased risk as the route to the returns they want or need.</li> </ul> <p>Among the items on Marks' of the items, the one we focused on yesterday, had to do with Marks recurring warnings on ETFs and passive investing. To be sure, he also covered pretty much everything else from equities, to the record low VIX, to FAANG stocks, to record tight credit spreads, to EM debt, to PE and even Bitcoin. </p> <p>To those who haven't read it yet, it <a href="">can be found here</a>. However we wanted to bring attention to one particular section, which lays out the necessary conditions which if met "will deliver a boom or bubble." In other words, Howard Marks' bubble checklist. The issue is that if these conditions (all of them) have to be present to validate a bubble, at least in the eyes of one of the world's most respected investors, then we may have a problem because at least according to the more skeptical market participants, most of these are currently present. </p> <p>Here is Marks:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>My son Andrew worked extensively with me in preparing this memo.&nbsp; We particularly enjoyed making a list of the elements that typically form the foundation for a bull market, boom or bubble.&nbsp; We concluded that some or all of the following are necessary conditions.&nbsp; A few will give us a bull market.&nbsp; All of them together will deliver a boom or bubble:</p> <ul> <li><strong>A benign environment </strong>– good results lull investors into complacency, as they get used to having their positive expectations rewarded.Gains in the recent past encourage the heated pursuit of further gains in the future (rather than suggest that past gains might have borrowed from future gains).</li> <li><strong>A grain of truth </strong>– the story supporting a boom isn’t created out of whole cloth; it generally coalesces around something real.The seed usually isn’t imaginary, just eventually overblown.</li> <li><strong>Early success</strong> – the gains enjoyed by the “wise man in the beginning” – the first to seize upon the grain of truth – tends to attract “the fool in the end” who jumps in too late.</li> <li><strong>More money than ideas</strong> – when capital is in oversupply, it is inevitable that risk aversion dries up, gullibility expands, and investment standards are relaxed.</li> <li><strong>Willing suspension of disbelief</strong> – the quest for gain overcomes prudence and deference to history.Everyone concludes “this time it’s different.”No story is too good to be true.</li> <li><strong>Rejection of valuation norms </strong>– all we hear is, “the asset is so great: there’s no price too high.”Buying into a fad regardless of price is the absolute hallmark of a bubble.</li> <li><strong>The pursuit of the new </strong>– old timers fare worst in a boom, with the gains going disproportionately to those who are untrammeled by knowledge of the past and thus able to buy into an entirely new future.</li> <li><strong>The virtuous circle </strong>– no one can see any end to the potential of the underlying truth or how high it can push the prices of related assets.It’s broadly accepted that trees can grow to the sky: “It can only go up.Nothing can stop it.”Certainly no one can picture things taking a turn for the worse.</li> <li><strong>Fear of missing out </strong>– when all the above becomes widespread, optimism prevails and no one can imagine a glitch.That causes most people to conclude that the greatest potential error lies in failing to participate in the current market darling.</li> </ul> </blockquote> <p>So where are we on this list according to Marks? The answer: almost there.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>Certainly many of the things listed above are in play today.&nbsp; </strong>Performance has been good – with minor exceptions, quickly rectified – since the beginning of 2009 (that’s more than eight years).&nbsp; There’s certainly more money around these days than high-return possibilities.&nbsp; “<strong>New ideas” are readily accepted, and some things are viewed as representing virtuous circles</strong>.&nbsp; </p> <p>&nbsp;</p> <p>On the other hand, some of the usual ingredients are missing.&nbsp; <strong>Most people (a) are conscious of the uncertainties listed above, (b) recognize that prospective returns are quite skimpy, and (c) accept that things are unlikely to go well foreve</strong>r.&nbsp; That’s all healthy. </p> <p>&nbsp;</p> <p>But on the third hand, most people can’t think of what might cause trouble anytime soon.&nbsp; But it’s precisely when people can’t see what it is that could make things turn down that risk is highest, since they tend not to price in risks they can’t see.&nbsp; <strong>With the negative catalyst so elusive and the return on cash at punitive levels, people worry more about being underinvested or bearing too little risk (and thus earning too low a return in good markets) than they do about losing money</strong>.&nbsp; </p> <p>&nbsp;</p> <p>This combination of elements presents today’s investors with a highly challenging environment.&nbsp;<strong> The result is a world in which assets have appreciated significantly, risk aversion is low, and propositions are accepted that would be questioned if investors were more wary.&nbsp; </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="640" height="360" alt="" src="" /> </div> </div> </div> Actuarial science B+ Behavioral finance Bitcoin Business cycle Central Banks Economic bubble Economic history of the Netherlands Economy Finance Financial crises Howard Marks Investment Investor Money Risk Thu, 27 Jul 2017 13:02:01 +0000 Tyler Durden 600590 at Investment Legend Warns of a 1987-Type Market Crash <p>Do you know Seth Klarman?</p> <p>Klarman is founder of Baupost Group and is widely considered to be one of the greatest value investors in history. In 30+ years from 1982 to 2015, he only had <strong><u>three losing years,</u></strong> and is believed to have averaged returns of 16%.</p> <p><u><b>Bear in mind, he did this</b> </u>while keeping 30%-50% in cash at all times.</p> <p>Put simply, Klarmen&#39;s returns on invested capital are simply astonishing. To be able to churn out those types of returns while being that risk-averse borders on the impossible.</p> <p>Which is why when Seth Klarmen and his team warns of a potential Crash, you need to listen.</p> <p>On that note, Klarmen&rsquo;s top advisor for publicly traded investments recently noted precisely what we&rsquo;ve been warning about for weeks: that automated trading in risk-parity funds is going to cause a potential 1987-type Crash.</p> <p data-mce-style="padding-left: 30px;" style="padding-left: 30px;"><em>In the Baupost Q2 Letter, Mooney estimates that investments linked to volatility &ldquo;</em><strong><em>likely runs in the hundreds of billions of dollars,&rdquo; a fact that could propel a market crash once the snowball starts running down the hill. &ldquo;Any spike in equity markets realized volatility, even to historical average levels, has the potential to drive a significant amount of equity selling (much of it automated),&rdquo; which would create a self-fulfilling feedback loop that only builds upon itself.</em></strong></p> <p data-mce-style="padding-left: 30px;" style="padding-left: 30px;">Source: ValueWalk</p> <p>We&rsquo;ve been noting for weeks that the markets are being rigged by risk-parity funds. All told these funds manage some $500 billion in assets. And they are mindlessly buying stocks based on automated triggers, NOT sound judgment.</p> <p>This works great when the market is rallying. But what happens when those same automated systems get hit with &ldquo;sell orders&rdquo; and some $500 billion in capital (the real amount is even larger as many of these funds are leveraged) hits &ldquo;SELL&rdquo;?</p> <p>The markets had a similar experience with automated trading programs in 1987. It wasn&rsquo;t pretty.</p> <p><img alt="" src="" style="width: 460px; height: 284px;" /></p> <p><strong>A Crash is coming...</strong></p> <p>And smart investors will use it to make literal fortunes.</p> <p>We offer a FREE investment report outlining when the market will collapse as well as what investments will pay out massive returns to investors when this happens. It&#39;s called <strong><u>Stock Market Crash Survival Guide</u></strong>.</p> <p>To pick up one of the last remaining copies&hellip;</p> <p><a data-mce-="" href="">CLICK HERE!</a></p> <p>Best Regards</p> <p>Graham Summers</p> <p>Chief Market Strategist</p> <p>Phoenix Capital Research</p> Baupost Group Business Economic history of the Netherlands Economy Equity Markets Finance Financial markets Investment Market Crash Mathematical finance Money Seth Klarman Seth Klarman Stock market Value investing Volatility Volatility Thu, 27 Jul 2017 12:57:23 +0000 Phoenix Capital Research 600589 at Core Durable Goods Orders Disappoint But Aircraft Orders Surge 131% <p>A huge upside surprise for durable goods orders (+6.5% MoM vs +3.9% MoM)... This was the<strong> biggest surge in DurGoods since July 2014&#39;s record Boeing order </strong>also screwed with the data...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 309px;" /></a></p> <p>Dominated by a 19% spike in transportation (with <strong>non-defense aircraft orders up 131.2% MoM</strong>)</p> <p><a href=""><img height="344" src="" width="600" /></a></p> <p>&nbsp;</p> <p>Up from $11bn to $25.3bn...</p> <p><a href=""><img height="382" src="" width="600" /></a></p> <p>New orders for manufactured durable goods in June increased $14.9 billion or 6.5 percent to $245.6 billion, the U.S. Census Bureau announced today.<strong> This increase, up following two consecutive monthly decreases, followed a 0.1 percent May decrease</strong>.</p> <p><strong>Excluding transportation, new orders increased 0.2 percent.</strong> Excluding defense, new orders increased 6.7 percent. Transportation equipment, also up following two consecutive monthly decreases, led the increase, $14.6 billion or 19.0 percent to $91.6 billion.</p> <p>However, away from this unsustainable surge in orders,<strong> Core Durable Goods Orders disappointed (+0.2% vs +0.4% exp) and Capital Goods New Orders Nondefense Ex Aircraft &amp; Parts fell 0.1% - the biggest drop since Dec 2016</strong>.</p> <p><a href=""><img height="308" src="" width="600" /></a></p> <p>Let&#39;s just hope Boeing can sell a few more planes in July or this picture won&#39;t look so rosy. One glimpse at the top chart above tells you what happens next month... we&#39;re gonna need another airshow!</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="1191" height="612" alt="" src="" /> </div> </div> </div> Boeing Boeing Business Business Census Bureau Economy of the United States Manufacturing U.S. Census Bureau Thu, 27 Jul 2017 12:44:55 +0000 Tyler Durden 600588 at Bill Blain: "Are We In A Bubble About To Burst, Or Are We Facing Massive Equity Upside?" <p><em>Submitted by Bill Blain of <a href="">Mint Partners</a></em></p> <p><strong>Are We In A Bubble About To Burst, Or Are We Facing Massive Equity Upside?</strong></p> <p>“A liberal is a conservative who has been arrested.”</p> <p>No surprises from the Fed last night. Unchanged rate talk and hints about reducing the balance sheet “relatively soon”. We can go figure what “relatively” means when inflation picks up. The stock market soared and VIX tumbled to a record low. Was that a warning about complacency? Since the 2008 crisis we’ve been here many times before – worrying about signals the economy is strengthening when suddenly its dived weaker. </p> <p>But, those us with longer memories can recall when the US economy has turned dramatically stronger – and in 1994, (yes, I remember it well), when the Fed acted prematurely, spiked the recovery and triggered what we’d now call a massive Treasury market TanTrum. This time it feels very different. I suspect we are very much still on course towards normalisation – a new kind of new normal: low rates, low inflation and steady state low growth. </p> <ul> <li>Stuff to watch today: Dovish Fed boosts stocks (record Dow) and dollar crashes. Lots of corporate results to wonder and worry about! </li> <li>Stuff the think about: Deutsche Bank results show it’s taken yet another thumping – difficult to see how it plays catch up and regains market relevance when it’s still swinging the headcount axe. Where is the US economy when inflation remains so low? What are the risks to Europe of the low dollar?</li> </ul> <p>Listening to the flow from our trading desks, clients and what I read on blogs and research, there are two distinct views on current markets:</p> <ol> <li><strong>Everything is a bubble about to burst</strong>. Financial asset prices are massively vulnerable to correction as Central Banks normalise and cut the market distortions of QE policies. Yada yada yada, been singing this song since QE began… (doesn’t mean its not right!)</li> <li><strong>The Global Economy is in the Goldilocks zone</strong>. We have an unbeatable combination of low interest rates, positive fiscal policy statements, strong political will, pent up demand, plus technical factors suggesting markets can go higher. All in all, its unbeatable, so pile into further stock market upside. </li> </ol> <p>So where are we really? What do central banks know that we don’t. (That is a rhetorical question – they are guessing as well.) Me? I’m waiting for a correction and then I’m putting my buying boots on… <br />My Macro Economist – Martin Malone – is a massive fan of further upside. (Happy to arrange for anyone to speak with him.) </p> <p>He reckons global markets will drive higher – and he’s been absolutely spot on so far this year! He’s looking at central bank balance sheets, zero interest rates, forward guidance, positive output gaps, a shift from low inflation, low investment and low productivity towards far stronger political initiatives, policy action and private sector investment. We’re also seeing record corporate profits and massive savings from low energy costs. He’s looking at a series of fundamental shifts across the economic factors that drive economies – and he discerns positives across the board. </p> <p>He says: “the bottom line is economic efficiencies or run-rate is much improved compared to any period of the past decade. Economists talk about growth broadening, but it’s not just the economy. All public and private sector balance sheets are aligned with the current step up in economic efficiency.” </p> <p>I can’t help be somewhat persauded by Martin’s obvious enthusiasm for the global recovery to finally break out of the last 8–years of post-crisis lethargy. But, I’m nervous – too worried perhaps about the reality of the current political incompetency in the UK, US and elsewhere. I’m nervous the positive energy won’t be sustained, and I’m particularly concerned about the pernicious effects of inequality across economies where under-employment and travesties like zero hours contracts are inflating corporate profits. These might fill executive wallets but they don’t create growth but resentment and potential social instability.&nbsp; </p> <p>But, hey-ho, get over it… </p> <p>Are we still in a bull market in Credit? Martin has aslo been looking at investment grade credits and concludes that even though IG credit has tightened back to 185bp, that’s the exact average of the past six decades! With the global economy in “Goldilocks”, he sees that as a clear bull signal and predicts 100 in 2018. I’ve attached Martin’s chart for your perusal. </p> <p>Again, I’m not so certain myself – the distorting effects of QE buying corporate paper isn’t just what central banks have absorbed. It’s the effect on market mindset that matters. Credit funds have been buying IG debt secure in the expectation central banks will buy it even as it tightens – it’s been a no brainer of a credit trade. </p> <p>Fascinating article in FT yesterday pointing out the real beneficiaries of QE have been a limited number of global large corporate borrowers who’ve been filling their boots with cheap debt to meet QE appetite. How that promotes SME growth by flowing money into the real economy beats me, but, hey, why worry, it's kept interest rates low.&nbsp; </p> <p>So, what can we conclude – the Fed is on hold, normalisation is in the air, and the stock markets love the current market. Hm.. thin summer markets and thin volumes… </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="304" height="166" alt="" src="" /> </div> </div> </div> Business Business cycle Central bank Central Banks Deutsche Bank Economic history of the Netherlands Economy Financial crises Financial market Global Economy Goldilocks Interest rate Investment Grade Macroeconomics Monetary policy Money Mortgage-backed security New Normal Reality recovery Subprime mortgage crisis US Federal Reserve Thu, 27 Jul 2017 12:17:31 +0000 Tyler Durden 600586 at Krona Sinks After Swedish PM Refuses To Resign, Reshuffles Cabinet Over "Disastrous Leak" <p>A brief (ECB/Fed-driven) sigh of relief yesterday in the Krona has ended as<strong> Sweden&#39;s embattled PM has refused to resign</strong> over the<a href=""> government&#39;s &quot;disastrous leak&quot; of the nation&#39;s citizens&#39; information</a>. Lofven has instead chosen to reshuffle his cabinet, ading <strong><em>&quot;I don&rsquo;t want political chaos in Sweden, that&rsquo;s not what we need right now, I will take responsibility and ensure we don&rsquo;t get a political crisis.&quot;</em></strong></p> <p>However, <a href="">as Bloomberg reports</a>, <strong>opposition members were already signaling they weren&rsquo;t satisfied with the steps taken</strong>, and Lofven&rsquo;s government remains far from secure.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>The prime minister said <strong>Home Affairs Minister&nbsp;Anders Ygeman&nbsp;and Infrastructure Minister&nbsp;Anna Johansson&nbsp;will leave the Cabinet,</strong> as parties representing a majority in parliament prepared no-confidence motions against them.</p> <p>&nbsp;</p> <p><strong>Defense Minister&nbsp;Peter Hultqvist&nbsp;will stay,</strong> Lofven told reporters in Stockholm on Thursday, arguing the specific motion against him was &ldquo;not serious.&rdquo;</p> <p>&nbsp;</p> <p>The announcement follows speculation the prime minister would himself be forced to resign, or <strong>call an early election,</strong> in response to the deepening scandal. With the reshuffle, Lofven is buying himself time to negotiate with parliament.</p> <p>&nbsp;</p> <p>Anna Kinberg Batra, head of the Moderate Party that leads the opposition, on Wednesday <strong>blamed Lofven for throwing Sweden into &ldquo;a serious security crisis.&rdquo;</strong></p> <p>&nbsp;</p> <p><strong>&ldquo;Confidence in the defense minister is exhausted,&rdquo; </strong>she said. <strong>&ldquo;The prime minister hasn&rsquo;t taken responsibility -- so we will demand responsibility in parliament.&rdquo;</strong></p> <p>&nbsp;</p> <p>The anti-immigration Sweden Democrats also said they <strong>remained committed to a no-confidence vote.</strong></p> </blockquote> <p>Citi notes that political noise has erupted in Sweden, after the government botched its response to a security breach of classified information, and while the political situation doesn&#39;t look like it will deteriorate for the time being, we think<strong> SEK upside is likely to remain limited for now.</strong></p> <p><a href=""><img height="317" src="" width="600" /></a></p> <p>&nbsp;</p> <p>While Swedish Prime Minister Stefan Lofven avoided the option to resign by choosing to reshuffle his government and &ldquo;is now playing the ball back to opposition,&rdquo; the opposition parties are likely to proceed with a no-confidence vote against Defense Minister Peter Hultqvist, SEB says in note.</p> <p>Initial comments from Christian Democrats indicate that opposition aims to continue to <strong>push for a vote of no confidence</strong> against Hultqvist; <strong>SEB says it will be very difficult for opposition to withdraw from that position.</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em><strong>&ldquo;Most likely the call for the parliament to return from summer vacation in about 10 days still stands and most likely also Hultqvist will be forced out of office&rdquo;</strong></em></p> </blockquote> <p>That means threat of government crisis will remain in near term.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em><strong>&ldquo;The opposition will continue to put pressure on the government to show political strength, while the government will try to fend off attacks by indicating it could step down or even call a snap election, something the opposition most likely would like to avoid&rdquo;</strong></em></p> </blockquote> <p><u><strong>Swedish politics over the next 10 days &ldquo;will be a chicken race&rdquo;</strong></u></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="1169" height="618" alt="" src="" /> </div> </div> </div> Anders Ygeman Anna Kinberg Batra Christian Democrats European Central Bank Government Government of Sweden Kinberg Lofven’s government Löfven Cabinet Moderate Party Moderate Party Motion of no confidence Peter Hultqvist Politics Politics Politics of Sweden Prime minister Prime Minister of Italy Prime Minister of the United Kingdom Snap election US Federal Reserve Thu, 27 Jul 2017 12:02:45 +0000 Tyler Durden 600584 at Scaramucci Implicates Priebus In Now-Deleted Tweet Following 'Felony' Leak Of Financial Disclosures <p><em>Content originally published at&nbsp;<a href="" target="_blank"></a></em></p> <p>White House Communications Director Anthony Scaramucci set of a firestorm of speculation last night with a now deleted tweet following a&nbsp;Politico&nbsp;article containing&nbsp;<a href="" rel="noopener noreferrer" target="_blank">information he claimed was leaked</a>&nbsp;- revealing his net worth at $85 million.</p> <p><a href="" target="_blank"><img src="" style="height: 398px; width: 600px;" /></a></p> <p>Scaramucci stated that he &quot;will be contacting @FBI and the @TheJusticeDept #swamp @Reince45,&quot; oddly tagging White House Chief of Staff Reince Priebus.</p> <p><img src="" style="height: 239px; width: 600px;" /></p> <p>In response, Twitter exploded with rumors that Priebus was a White House leaker - an implication which Ryan Lizza of&nbsp;The New Yorker&nbsp;(and contributor to CNN) somehow confirmed.</p> <blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="en">In case there&#39;s any ambiguity in his tweet I can confirm that Scaramucci wants the FBI to investigate Reince for leaking.</p> <p>&mdash; Ryan Lizza (@RyanLizza) <a href="">July 27, 2017</a></p></blockquote> <script async src="//" charset="utf-8"></script><blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="en">Wait really?</p> <p>&mdash; Christopher Hayes (@chrislhayes) <a href="">July 27, 2017</a></p></blockquote> <script async src="//" charset="utf-8"></script><blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="und">Yes <a href=""></a></p> <p>&mdash; Ryan Lizza (@RyanLizza) <a href="">July 27, 2017</a></p></blockquote> <script async src="//" charset="utf-8"></script><p>30 minutes later, another &quot;blue check&quot; Twitter user - Josh Kraushaar from&nbsp;National Journal,&nbsp;tweeted &quot;@RyanLizza reports on CNN that Mooch already contacted the FBI about Reince // not just a threat (as he said in tweet).&quot;</p> <blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="en">.<a href="">@RyanLizza</a> reports on CNN that Mooch already contacted the FBI about Reince // not just a threat (as he said in Tweet)</p> <p>&mdash; Josh Kraushaar (@HotlineJosh) <a href="">July 27, 2017</a></p></blockquote> <script async src="//" charset="utf-8"></script><p>However, as <strong>speculation reached a fevered pitch, Scaramucci - who keeps his phone at 100% charge - poured cold water over the hopes and dreams of everyone who hates Reince</strong><span id="cke_bm_208E" style="display: none;">&nbsp;</span>, tweeting &quot;Wrong! Tweet was public notice to leakers that all Sr Adm officials are helping to end illegal leaks. @Reince45&quot;</p> <blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="en">Wrong! Tweet was public notice to leakers that all Sr Adm officials are helping to end illegal leaks. <a href="">@Reince45</a> <a href=""></a></p> <p>&mdash; Anthony Scaramucci (@Scaramucci) <a href="">July 27, 2017</a></p></blockquote> <script async src="//" charset="utf-8"></script><p>While Scaramucci said the &#39;leak&#39; of&nbsp;his financial disclosure form was a &quot;felony,&quot; The&nbsp;<a href="" rel="noopener noreferrer" target="_blank">New York Times</a>&nbsp;reported that the document, filed on June 23, could have been released July 23 upon a journalist&#39;s request. When reached for comment as to why he thought there was an illegal leak, Scaramucci told the NYT &quot;They aren&#39;t in process yet.&quot;</p> <p><strong>Hannity interview - and then dinner?&nbsp;</strong></p> <p>Earlier in the evening, Scaramucci appeared on Fox News with Sean Hannity to discuss the leaks, where he said that the leaks were actually orders from senior officials handed down to underlings.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>One of the big problems here that I&#39;m discovering in the comms team is that senior people are really the guys doing the leaking, and they ask junior people to leak for them. So, I&#39;m very proud to be reporting directly to the president so that I can hermetically seal off the comms team from this sort of nonsense.</p> <p>&nbsp;</p> <p>You and I both know that there are political holdovers from the Obama administration that want to put a hurt on the Trump administration, so we have to sort of move quickly there as well. -Anthony Scaramucci</p> </blockquote> <div><iframe frameborder="0" height="348" src="" width="618"></iframe>&nbsp;&nbsp;</div> <p>In response to Scaramucci&#39;s appearance on Hannity, the DOJ issued this statement:</p> <blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="en">DOJ spokesperson Sarah Isgur Flores issues a statement responding to <a href="">@Scaramucci</a>&#39;s <a href="">@seanhannity</a> appearance tonight: <a href=""></a></p> <p>&mdash; Chris Geidner (@chrisgeidner) <a href="">July 27, 2017</a></p></blockquote> <script async src="//" charset="utf-8"></script><p>&nbsp;</p> <p>And in yet another &#39;leaked&#39; tidbit from earlier yesterday, Ryan Lizza also reported that president Trump, Sean Hannity, Bill Shine, and Anthony Scaramucci had plans&nbsp;to eat dinner together last night.</p> <blockquote class="twitter-tweet" data-lang="en"><p dir="ltr" lang="en">Scoop: Trump is dining tonight w/Sean Hannnity, Bill Shine (former Fox News executive), &amp; Anthony Scaramucci, per to 2 knowledgeable sources</p> <p>&mdash; Ryan Lizza (@RyanLizza) <a href="">July 26, 2017</a></p></blockquote> <script async src="//" charset="utf-8"></script><p>Don&#39;t read too much into it, but apparently Reince wasn&#39;t there...</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="473" height="265" alt="" src="" /> </div> </div> </div> American people of German descent American studies Anthony Scaramucci CNN DOJ Donald Trump FBI Federal Bureau of Investigation Obama administration Reince Priebus Ryan Lizza Scaramucci Sean Hannity Trump Administration Twitter Twitter United States White House White House Thu, 27 Jul 2017 11:59:12 +0000 Tyler Durden 600575 at Frontrunning: July 27 <ul> <li>Healthcare showdown (<a href="">Reuters</a>)</li> <li>Tax Overhaul in Doubt With House Stuck on Budget Disagreements (<a href="">BBG</a>)</li> <li>Dollar steadies after Fed skid, shares hit new highs (<a href="">Reuters</a>)</li> <li>Samsung Is Closing In on Apple as World’s Most Profitable Tech Firm (<a href="">WSJ</a>)</li> <li>Sweden's PM Refuses to Resign After Cyber-Security Scandal (<a href="">BBG</a>)</li> <li>In Trump-Sessions Impasse, Aides Urge President to Back Off (<a href="">WSJ</a>)</li> <li>Scaramucci Says He’ll Contact FBI Over ‘Leak’ of Financial Data (<a href="">BBG</a>)</li> <li>U.S. lawmakers reach deal for Senate Russia sanctions vote (<a href="">Reuters</a>)</li> <li>AstraZeneca shares drop most on record after big drug trial setback (<a href="">FT</a>)</li> <li>Macron Taps a Decade of Italian Anger Since Zidane Headbutt (<a href="">BBG</a>)</li> <li>Verizon’s All-You-Can-Eat Data Plans Win Users, Lift Profit (<a href="">BBG</a>)</li> <li>Libor Interest Rate Benchmark to Be Phased Out in 2021 (<a href="">BBG</a>)</li> <li>Treasury Market's Big Short Bet Foiled by Fed Policy Statement (<a href="">BBG</a>)</li> <li>Why You’re Not Getting a Raise (<a href="">BBG</a>)</li> <li>Secretary of State Tillerson says he is 'not going anywhere' (<a href="">Reuters</a>)</li> <li>Wall Street Needs You to Borrow Against Your Stock (<a href="">WSJ</a>)</li> <li>Here Come the Tesla Model 3s... and a Few Surprises (<a href="">BBG</a>)</li> <li>Nestle Outlook for Weakest Sales in 20 Years Gives Loeb Ammo (<a href="">BBG</a>)</li> <li>Deutsche Bank expects lower 2017 revenue after mixed second quarter (<a href="">Reuters</a>)</li> <li>Energy Capital Is Said to Hold Advanced Talks to Buy Calpine (<a href="">BBG</a>)</li> <li>Ukraine president strips one-time ally Saakashvili of citizenship (<a href="">Reuters</a>)</li> <li>Etihad Posts $1.87 Billion Loss in Worst Blow for Gulf Carriers (<a href="">BBG</a>)</li> <li>China reviewing copper scrap imports; may call halt in 2018 (<a href="">Reuters</a>)</li> <li>U.S. indicts suspected Russian 'mastermind' of $4 billion bitcoin laundering scheme (<a href="">Reuters</a>)</li> </ul> <p>&nbsp;</p> <p>Overnight Media Digest</p> <p><em><span style="text-decoration: underline;">WSJ</span></em></p> <p>- Senate GOP leaders picked up support Wednesday for their plan to pass a scaled-back bill to repeal a handful of elements in the current health law, and then open negotiations with House Republicans to try to bring together their two very different bills.</p> <p>- Foxconn, the maker of iPhones and other gadgets for Apple Inc, plans to build a plant in Wisconsin that a White House official said will initially bring 3,000 jobs to the state.</p> <p>- The U.S. Federal Reserve signaled Wednesday it is ready as soon as September to start slowly shrinking its holdings of more than $4 trillion in bonds it bought to try to buoy the economy.</p> <p>- Viacom Inc is out of the running to acquire Scripps Networks Interactive, leaving Discovery Communications Inc as the only remaining suitor in talks to purchase the cable TV programmer, people familiar with the situation said.</p> <p>- is launching in Singapore with a twist: It is targeting loyal, time-strapped shoppers by starting with its more limited one- and two-hour subscription delivery option.</p> <p>- A bankruptcy judge will consider approval of Berkshire Hathaway Energy Co's proposed takeover of Oncor Electric Delivery on Aug. 21. Paul Singer's Elliott Management had sought a later date for more time to raise financing for its rival proposal. </p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">FT</span></em></p> <p>Britain's home secretary, Amber Rudd, promised business on Thursday that she would not close the door to European workers after Brexit, in a significant softening of the government’s tone on EU migration.</p> <p>German insurer Allianz SE has reported a 23 percent jump in second-quarter profits and says that its full-year numbers will be towards the top end of its target range.</p> <p>Artemis, the holding company of France's Pinault family, has sold its stake in French retailer Fnac Darty SA to Germany's Ceconomy, which is seeking to consolidate European electronics sellers to compete against Amazon.</p> <p>Cerberus, the U.S. private equity group, has bought a 675 million euro stake in Commerzbank AG, which makes it the third-largest shareholder in the German lender and sets up a potential clash with the government in Berlin</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">NYT</span></em></p> <p>- The former head of labor relations at Fiat Chrysler Automobiles was indicted on conspiracy and other charges by a federal grand jury on Wednesday, accusing him of siphoning off millions of dollars from a workers training center.</p> <p>- A jury in Los Angeles on Wednesday awarded Quincy Jones $9.4 million damages, finding that he was underpaid his share of royalties for the use of music in the posthumous Jackson film "This Is It" and two Cirque du Soleil shows.</p> <p>-A Russian man, Alexander Vinnik, was arrested in Greece on Tuesday after being charged for overseeing a black market Bitcoin exchange that helped launder billions of dollars and stood at the nexus of several criminal enterprises, according to a federal indictment.</p> <p>- The Fed, in a statement after a two-day meeting of its policy-making committee, said it would start reducing its bond holdings "relatively soon" as long as moderate economic growth continues.</p> <p>- Britain announced on Wednesday that sales of new diesel and gas cars would reach the end of the road by 2040, the latest step in Europe's battle against the damaging environmental impact of the internal combustion engine.</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">Canada</span></em></p> <p>The Globe and Mail</p> <p>** The Supreme Court of Canada affirmed on Wednesday that Indigenous people do not have a veto over resource projects affecting their traditional territory, even as it quashed a regulatory permit for an oil-exploration program that Inuit residents of Baffin Island feared would damage their hunting rights.</p> <p>** Canada is reviewing the U.S. administration's decision to sanction 13 current and former Venezuelan government officials ahead of a controversial election on Sunday that could turn Venezuela into a dictatorship. Foreign Affairs Minister Chrystia Freeland welcomed the United States sanctions, but did not say if Canada will follow suit.</p> <p>** Suncor Energy Inc is battling higher costs at its Syncrude oil sands project and said it would take longer than expected to restore production at the problem-plagued operation after a fire tore through the facility earlier this year.</p> <p>National Post</p> <p>** Canada Mortgage and Housing Corp continues to give the national housing market its worst possible rating, saying there still is "strong evidence of problematic conditions" — an assessment first made three quarters ago.</p> <p>** The chief executive of U.K.-based Finastra, which absorbed Toronto-based DH Corp last month, said Canada would continue to be an "incredibly crucial part of our ecosystem going forward" and that it intended to expand its capabilities on this side of the pond. CEO Nadeem Syed also said Canada represents upwards of 20 percent of Finastra's overall revenues — just behind the United States. </p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">Britain</span></em></p> <p>The Times</p> <p>Royal Bank of Scotland Group Plc has agreed a deal with Brussels that will finally allow the lender to call off its sale of the Williams &amp; Glyn business.</p> <p>GlaxoSmithKline Plc will cull more than 30 development programmes and aim for 1 billion pounds ($1.31 billion) of extra annual savings in a shake-up under its new boss.</p> <p>The Guardian</p> <p>Britain's car industry has warned that the government's proposed ban on sales of new petrol and diesel cars by 2040 risks damaging the industry and stalling sales of new cars.</p> <p>A regulatory regime intended to crack down on the behaviour of bank bosses is to be extended to 47,000 firms including dentists, gyms and tool hire companies that offer credit to customers.</p> <p>The Telegraph</p> <p>Lloyds Banking Group Plc has set aside 300 million pounds to repay 600,000 customers for mortgage arrears errors that took place over a seven-year period, sources said.</p> <p>BT Group Plc has landed a blow against attempts to boost competition in the market for heavy-duty broadband lines for businesses, threatening access to the "dark fibre" that rivals say will be crucial to 5G mobile connectivity.</p> <p>Sky News</p> <p>The government will stop charging employment tribunal fees and refund those who have already paid them - after the Supreme Court found they were unlawful.</p> <p>JPMorgan Chase &amp; Co is drawing up plans to merge its UK-based private banking arm into its wider European wealth operation ahead of the UK's departure from the European Union.</p> <p>The Independent</p> <p>The Royal Institution of Chartered Surveyors found that nearly half of construction workers predict the gender pay gap will be less than 15 percent by April 2018. It is currently 18.1 percent.</p> <p>&nbsp;</p> Apple Berkshire Hathaway Bitcoin Bitly Bond broadband Business Cable TV China Chrysler Copper Deutsche Bank Economy European Union European Union FBI Federal Bureau of Investigation Federal Reserve Finance Financial data vendors Greece Housing Market JPMorgan Chase LIBOR Libor Lloyds Money Private Equity Republican Party Reuters Reuters Royal Bank of Scotland Royal Institution of Chartered Surveyors Senate Russia Supreme Court The Wall Street Journal Thomson Reuters Ukraine US Administration US Federal Reserve Venezuelan government Viacom White House White House Thu, 27 Jul 2017 11:58:19 +0000 Tyler Durden 600583 at