The question of just who, what, where, and when the US government spied on and stored metadata about is moot now... thanks to Edward Snowden; but President Obama will be firing on all his teleprompter-based cylinders today as he explains the "changes" to NSA data collection and the likely "punt" deferrals to Congress:
HAYDEN SAYS OBAMA MAY 'PUNT' SOME QUESTIONS TO CONGRESS ON NSA
OBAMA SAID TO ORDER END OF SECTION 215 METADATA PROGRAM (as it currently exists)
NSA SAID TO NO LONGER KEEP BULK PHONE RECORDS UNDER OBAMA PLAN
Calling for an 'overhaul' of the NSA (seeking input from Congress and intelligence officials) will, we are sure, appease those who cannot believe the 'hope-and-change'-monger could have sanctioned such things; but we suspect little will change in reality.
The most notable number in today's Industrial production report was the update of Capacity Utilization, which rose once again from 79.1% to 79.2%, 10 basis point higher than expectations. This was also the highest Cap Utilization print since May 2008 and makes a further case that the economic cycle is in its late stages and that slack, contrary to what economists are repeatedly, and incorrectly, claiming is rapidly dropping to the point where it is indeed time to start thinking about the arrival of the next dreaded "R" word.
Moments ago UPS released its Q4 earnings which missed EPS expectations of $1.43, printing at $1.25 instead (too bad it was not a bank or it could just add back half of SG&A to the bottom line and slap a 10% tax rate on it). Additionally, the company concurrently lowered full year 2013 guidance saying "Full-year 2013 adjusted diluted earnings per share are expected to be $4.57, below the previously provided guidance of $4.65 to $4.85." Good to know the guidance cut waited until literally the last possible moment for it to be revealed. Naturally, one of the factors blamed for the miss was the weather: "weather events in December weighed on results." Events? But the punchline is the other thing UPS blamed for missing earnings (and supposedly for the weaker forecast): a surge in business! That's right - for the first time ever a company blames too much business... for not generating enough business. "U.S. results were negatively impacted by the challenges of the compressed peak season coupled with an unprecedented level of online shopping that included a surge of last-minute orders. In an effort to maintain service standards and commitments, UPS took extraordinary measures deploying additional equipment and people. For example, the company utilized 85,000 temporary employees, 30,000 more than planned."
Last month's record-breaking surge in housing starts has rapidly reversed and fell 9.8% MoM - the biggest drop since April 2013. Despite a plethora of revisions, single unit housing starts tumbled to 610k - the lowest since July. However, permits were dismal (which is what we should be caring about if we are looking ahead at how the 'recovery' will play out). Building Permits dropped 3% MoM, far more than expected, missing by the largest gap since June. This was the 3rd biggest monthly drop in total starts since Lehman. However, year-over-year, the data is abysmal - Starts rose at the slowest pace since Aug 2011, and Permits at the slowest pace since April 2011.
"If You Like Your Phone Records, You Can Keep Your Phone Records": Obama To Announce NSA Overhaul At 11:00 AMSubmitted by Tyler Durden on 01/17/2014 09:18 -0400
Remember when Obama said he would have engaged in a dramatic overhaul of the NSA with or without Edwards Snowden? Funny as that statement may have been at the time (and recall that Comedians have psychotic personality traits, study finds), we will never know just what Obama would have done if... but we do know that at 11 am this morning, Obama will say he is ordering a transition that will significantly change the handling of what is known as the telephone "metadata" program from the way the NSA currently handles it. In other words, if you like your phone records, you can keep your phone records. It goes without saying that the number of people who believe anything the president says at this point is the same number or less than the dozen or so Chinese enthusiasts who waited in "line" to get a new China Mobile phone.
The NYT reports that if judging by the initial response to Apple's expansion into China, then this too latest Apple "rollout" is set to be a major flop. To wit: " Apple has been counting on a long-awaited agreement with China Mobile, the world’s largest cellular operator, to reverse its fortunes in China. If the muted reception Friday, when customers were finally able to buy iPhones from China Mobile, is any indication, the companies may have to work harder to whip up enthusiasm. Instead of the round-the-block lines that have greeted Apple product introductions in China and other countries in the past, only about a dozen customers showed up to buy iPhones at the opening of a store in Beijing — despite the presence of a special guest, the Apple chief executive, Timothy D. Cook."
- NSA phone data control may come to end (AP)
- China to rescue France: Peugeot Said to Weigh $1.4 Billion From Dongfeng, France (BBG)
- China to rescue Davos: Davos Teaches China to Ski as New Rich Lured to Slopes (BBG)
- Hollande’s Tryst and the End of Marriage (BBG)
- Iran has $100 billion abroad, can draw $4.2 billion (Reuters)
- Target Hackers Wrote Partly in Russian, Displayed High Skill, Report Finds (WSJ)
- Nintendo Sees Loss on Dismal Wii U Sales (WSJ)
- Goldman's low-cost Utah bet buoys its bottom-line (Reuters)
- Royal Dutch Shell Issues Profit Warnin: Oil Major Hit by Higher Exploration Costs and Lower Oil and Gas Volumes (WSJ)
- EU Weighs Ban on Proprietary Trading at Some Banks From 2018 (BBG) - so no holding of breaths?
- Sacramento Kings to Accept Bitcoin (WSJ)
Remember when banks were exposed manipulating virtually everything except precious metals, because obviously nobody ever manipulates the price of gold and silver? After all, the biggest "conspiracy theory" of all is that crazy gold bugs blame every move against them on some vile manipulator. It may be time to shift yet another conspiracy "theory" into the "fact" bin, thanks to Elke Koenig, the president of Germany's top financial regulator, Bafin, which apparently is not as corrupt, complicit and clueless as its US equivalent, and who said that in addition to currency rates, manipulation of precious metals "is worse than the Libor-rigging scandal." Hear that Bart Chilton and friends from the CFTC?
Weak results from Intel, American Express and Capital One, not to mention Goldman and Citi? No problem: there's is overnight USDJPY levitation for that, which has pushed S&P futures firmly into the green after early overnight weakness: because while the components of the market may have such trivial indicators as multiples and earnings, the USDJPY to which the Emini is tethered has unlimited upside. And now that the market is back into "good news is good, bad news is better" mode, today's avalanche of macro data which includes December housing starts and building permits, industrial production, UofMichigan consumer confidence and JOLTs job openings, not to mention the up to $3 billion POMO, should make sure the week closes off in style: after all can't have the tapped out consumer enter the weekend looking at a red number on their E-trade account: they might just not spend as much (money they don't have).