December 28: Daily Contrarian Reads

How The Asset Bubble Could End, Part 2

A new all-time high in NYSE margin debt: this is in line with the other indicators shown here, and normally margin debt tends to peak before the market does. This is generally true – but not always.  We found two major market peaks – namely the 1937 and 1973 tops – when margin debt peaked after the market had topped out. In 1937, it happened just one month after the top, in 1973 it happened 8 months after the top. Note also that at the 1937 market peak, there was no warning from the NYSE advance-decline line either – it topped almost concurrently with prices.

Subprime Auto Defaults Are Soaring, And PE Firms Have No Way Out

In the years after the financial crisis, buyout firms poured billions into auto finance, angling for the big profits that come with offering high-interest loans to buyers with the weakest credit. At rates of 11 percent or more, there was plenty to be made as sales boomed. But now, with new car demand waning, they’ve found the intense competition — and the lax underwriting standards it fostered — are taking a toll on profits.

Irony of The Day: Ultra-Expansionist Swiss Central Bank Bails Out Firm Which Prints Swiss Banknotes

In the most ironic story of the day, the company that makes the paper that Swiss banknotes are printed on was just bailed out by the money-printing, stock-purchasing, plunge-protecting, savior-of-global equities…Swiss National Bank.

What Bubble? Silicon Valley Homes Going for $2 Million Over Asking Price

If you’re still holding out hope that the following chart is anything but another massive housing bubble in the making then you should probably ignore the disturbing evidence to the contrary that we’re about to present below.

Correcting Three Mis-Statements About The GOP Tax Reform Bill

The reality is that a large number of American’s will experience little or no change to their current tax liability. As shown by the chart below from JPMorgan, the tax-cuts will primarily benefit the upper-middle income brackets and self-employed individuals. However, since the Affordable Care Act was not repealed, whatever savings are achieved through tax reform will likely be consumed by higher health care costs.

Health Care To The Rescue—-Why GDP “Growth” Never Fails

And yet, most other line items also saw a downward revision, which means that something had to increase sharply to compensate for the downward revisions among other spending components. Sure enough, something did: the old faithful “plug” which has saved the US economy every quarter for the past 4 years: Healthcare, or as it is better known, Obamacare, because with Trump failing to repeal Obama’s signature health law, and even the recent Tax Cut putting Obamacare in limbo it means that Healthcare will merrily “contribute to GDP” for years to come, by being the single biggest marginal spending item for the foreseeable future.

Bad Moon Rising—-Why The Deep State May Try To “Compromise” With Trump

But then Donald Trump, elected President by his deplorables’ base, made clear that he wished for détente with Russia, and even disdained the claims made on ordinary Americans by the maintenance of America’s unipolar global ‘order’. For this heresy, he has been punished by the manufactured ‘Russiagate’ non-scandal. “Can a president, concerned that he might be removed from office by a special prosecutor or possibly assassinated, resist the march toward war?” – asks Paul Craig Roberts, who asserts that the President has been effectively caged, by a trifecta of Establishment generals, on the one hand; and by a Goldman Sachs posse, on the other.

Long Island Iced Tea: Would You Like Some Ice In Your Blockchain?

As you can see, that’s Long Island Iced Tea Corp., and as the company name suggests, they make iced tea. Or at least they used to.

Forget The Wall Street Bloviators

Oh sure, these richly-compensated pros bloviate about market and business cycles throughout various national media outlets. Some even provide blessings for Thanksgiving. Yet when it comes to portfolio actions, they lose their appetites. The pervasive blanket advice for retail investors is to do nothing in the face of a bear. Granted, that may be suitable advice. For the so-called pundits? It’s the only guidance employers will permit. You’ll rarely hear the word ‘sell.’ It’ll be some nebulous, milquetoast, politically-correct terminology like “maintain a neutral weight to stocks,” whatever the heck that means.

Another Shoe To Fall – Ex-FBI Assistant Director: Patriots Within The FBI Will Soon Step Forward And Expose The “Cabal”

Former FBI Assistant Director James Kallstrom spoke to FBN’s Stewart Varney to discuss recent bombshells concerning the FBI, whose top brass has been conducting a highly politicized witch-hunt of President Trump on behalf of the anti-Trump establishment, while protecting then-candidate Hillary Clinton from criminal charges related to her email investigation, Clinton Foundation involvement in pay-for-play schemes, including a farcical probe of the Uranium One scandal.