Every society is ruled by an elite. They prey upon the common folks like ticks on a dog. They work their way into positions of power and influence, using a combination of brains, connections, and claptrap. The mob generally looks up to them, impressed by the hocus pocus. And then, eventually, the ticks grow too many and too fat. The poor dog weakens… and the magic fails. Where exactly we are in the process, we can’t be sure. But surely, we took another step toward the eventual catastrophe when Ms. Yellen spoke…….Everything she said was preposterous.
After making the provocative and dangerous charge that Russia is covering up Syria’s use of chemical weapons, the Trump administration withheld key evidence to support its core charge that a Syrian warplane dropped sarin on a northern Syrian town on April 4……..According to a source, the analysts struggled to identify whose drone it was and where it originated. Despite some technical difficulties in tracing its flight path, analysts eventually came to believe that the flight was launched in Jordan from a Saudi-Israeli special operations base for supporting Syrian rebels, the source said, adding that the suspected reason for the poison gas was to create an incident that would reverse the Trump administration’s announcement in late March that it was no longer seeking the removal of President Bashar al-Assad.
Just when you thought it was safe to stride safely through the forest of stock market investing (hey – banks, Trump, hope, reform, stimulus, earnings, and Trump again); the bears are coming out of hibernation… The calm in stocks worldwide is giving way to concern, as Bloomberg reports investors in Europe and the U.S. are rushing to hedge against declines and a Credit Suisse index flashing a warning as the list of economic and political obstacles grows.
The Jefferson who emerges from these pages is fascinating yes, but more importantly, a radical. His positions on federalism, freedom of conscience, and the like consistently put him at odds with established practice going back many centuries throughout the Western world. Federalism is the aspect of Jefferson’s thought that most irritates historians, and prominent scholars have gone out of their way to minimize Jefferson’s commitment to it. The Kentucky Resolutions of 1798, a radical statement in support of state nullification against unconstitutional federal laws, is portrayed instead as a defense of civil liberties against the Alien and Sedition Acts. Jefferson’s draft resolutions of 1825, which revived the spirit of ’98, are often not mentioned at all; Merrill Peterson excluded them from the Library of Virginia edition of the writings of Jefferson.
The market for office buildings in one of the hottest and most overheated real-estate markets in the world, New York City, just went into the deep-freeze. If you see the word “plunge” a lot below, it’s because that’s what happened in the first quarter of 2017. It was exactly what no one in the industry needed. Sales of large office properties (those with over 50,000 square feet) that closed in Q1 2017 plunged 63% year-over-year, from $5.54 billion in Q1 2016 to $2.1 billion. It was the lowest transaction amount in any quarter since Q1 2013.
While talk is cheap, the reality is the Federal Reserve fostered another surge in leverage by promoting and maintaining “accommodative” policies for far too long. The chart below is the aggregate of corporate, consumer, margin and banking debt in billions. I have excluded governmental debt so we can focus on the leverage in the economy. I have added GDP for comparative purposes……The question that should be asked of Ms. Yellen is simply: “After trillions in various bailouts of the financial system, and claims the ‘health’ of the financial system is good, why does FASB Rule 157 still remain repealed?” The answer is simple. The “health” of the financial system may not be as strong as advertised.
S&P 500 tech stocks have now fallen for 9 days in a row. The last time tech stocks declined for so many days in a row was in 2012, and that was the only other time in history when we have seen such a long losing streak. As I have stated before, the post-election “Trump rally” is officially done, and the market is starting to roll over as investors begin to realize that all of the buying momentum has completely evaporated. Tech stocks tend to be particularly volatile, and so the fact that they are starting to lead the way down should definitely be alarming to many in the investing community. Of course it isn’t just tech stocks that are falling. The Dow was down another 59 points on Wednesday, and the S&P 500 has closed beneath its 50 day moving average for the very first time since the election. For those that have been waiting for a key technical signal before getting out of the market, there is one for you.
The real Donald Trump has been exposed. The man who promised a sensible and non-interventionist Middle Eastern policy and a reset with Moscow has now reneged on both pledges. His nitwit United Nations Ambassador Nikki Haley has directly linked Russia and Syria for punishment by the omnipotent Leader of the Free World lest anyone be confused. The unconscionable attack on Syria based on the usual unsubstantiated allegations has shifted the playing field dramatically, with the “new sheriff in town” apparently intent on proving he is a real man who can play hardball with the rest of them. Last week Syria was blamed by all and sundry in the Establishment for an alleged chemical weapons attack just two days after the White House backed away from the Obama Administration demand that President Bashar al-Assad be removed. Was Syria dumb enough to use chemical weapons in a war that it is winning at a point when the overt hostility from Washington had been ratcheted down? Or was it staged by the so-called rebels?
For those who may have missed it, GM’s former Vice Chairman Bob Lutz dropped a whole lot of reality on some unsuspecting Tesla cheerleaders on CNBC this morning. A rather blunt Lutz shared his views, as have we on several occasions, that Tesla’s constant cash burn combined with a barrage of competitive models that are about to hit the market likely indicate that the company is “doomed.” As for Tesla’s gravity-defying stock price, Lutz attributed the company’s soaring market cap solely to Musk being the “greatest salesman in the world” along with his being “aided and abetted by some analysts.”……..“The fact is it’s a constant cash drain. They’re highly dependent on federal government and state incentives for money which constantly flows in. They have capital raises all the time. Even the high-end cars that they build now cost more to build than they’re able to sell them for. Mercedes, BWM, Volkswagen, GM, Audi and Porsche are all coming out with 300-mile [range] electric luxury sedans…I think they’re doomed.”
On his last night in office, President Dwight D. Eisenhower delivered a powerful farewell speech to the nation — words so important that he’d spent a year and a half preparing them. “Ike” famously warned the nation to “guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.” Much of Eisenhower’s speech could form part of the mission statement of WikiLeaks today. We publish truths regarding overreaches and abuses conducted in secret by the powerful.