President Ronald Reagan’s reaction to the Libyan terrorist bombing of La Belle Disco in Berlin on April 5, 1986, that killed two and injured 79 other U.S. servicemen is another case in point. We had intercepted a Libyan message that morning: “At 1:30 in the morning one of the acts was carried out with success, without leaving a trace behind.” (We should add here that NSA’s dragnet SIGINT capability 30 years later renders it virtually impossible to avoid “leaving a trace behind” once a message is put on the network.)….President Reagan ordered the U.S. Air Force to bomb Col. Muammar Qaddafi’s palace compound to smithereens, killing several civilians. Amid widespread international consternation and demands for proof that Libya was responsible for the Berlin attack, President Reagan ordered us to make public the encrypted Libyan message, thereby sacrificing a collection/decryption capability unknown to the Libyans – until then.
Such a forecasting strategy may seem logical, and has worked well for the last four years, but it fails to acknowledge that earnings growth, which have repeatedly been grossly over-estimated, have been relatively flat over the same period. Since 2012, the S&P 500 has risen almost 70% while earnings are up a mere 2%. The graph below plots the S&P 500, earnings per share and their respective trend lines.
US headline inflation rose for a 5th consecutive month, and has not seen a negative print since February, following today’s report that CPI in December rose 0.3%, and up 2.1% from a year ago, the highest since June 2014. Both measures came in line with expectations as energy and gas costs rise and rents and medical costs continued to rise.
As for being intact, after a messy holiday shopping season, some investors have begun to question how the physical retail body will survive Jeff Bezos’ answer to Death by 1,000 Cuts. The poster child for a slow death in retailing, Sears, kicked off 2017 with the announcement that it would close an additional 150 stores, bringing to 200 the total for the current fiscal year. That’s on top of the 78 shuttered last year and the more than 200 in 2015. By April of this year, the once-quintessential retailer will have fewer than 1,500 stores left standing, down from 2011, when it had more than 3,500…..You would agree it’s been a rough go of it for bricks and mortar. Circuit City started things off a decade ago and was followed by Linens & Things, Blockbuster, Borders, and more recently, Radio Shack and Sports Authority. As is the case with the most recent fallen name, The Limited, many of these once-household names were invaded by private equity kingpins and saddled with untenable debt loads.
“The Germans are angry. The Chinese are downright furious. Leaders of NATO are nervous, while their counterparts at the European Union are alarmed.” Oh heavens-to-Betsy, whatever shall we do?…..So what’s the source of this latest Trumpanic? It’s an interview with Tory mandarin Michael Gove and Kai Diekmann, a former editor of the German newspaper Bild, in which the President-elect reiterates what he’s been saying to the American people for the past year, and on the basis of which he won the election: US foreign policy is going to change, and in a big way…..However, to Times reporter Steve Erlanger, this all comes as a big revelation, evidence that “Trump has again focused his penchant for disruption on the rest of the world.” Oh, the poor babies! Perhaps they need to find a safe space in which to park themselves for the next four-to-eight years.
In late 2009, the mix was about 50%, or, turning it around, 2 to 1; for every RMB in outstanding bank reserves (apart from actual RMB currency) there were 2 in forex “assets” of whatever composition. By the middle of 2013, the proportion was down to 75%, meaning 3 RMB in bank reserves for every 4 RMB in “dollars.” That ratio would remain steady until the “rising dollar.” As of the latest update for December 2016, bank reserves just cross the “unbacked” threshold for the first time, a massive shift just in 2016 alone.
It such investments are not supported by an increase in real savings, capital will be consumed. The falsification of economic calculation engendered by prices that have been distorted by credit expansion inter alia leads to the reporting of illusory accounting profits – later it turns out that capital maintenance has been lacking and the previously reported profits turn into very large losses (think about 2008/2009 as the most recent example of such an “unmasking”). At some point the capital consumption will be reflected by a surge in market interest rates and a shift in prices. Many of Trump’s policy proposals (if implemented) are likely to hasten this process, ceteris paribus.
Every American who looks at the CIA objectively or in a balanced way and judges it by any number of criteria, such as moral, legal and pragmatic, should reach the conclusion that the CIA should be abolished. JFK wanted to break it into a million pieces. Trump is right to dismiss its intelligence reports about DNC hacking. The CIA war on Trump shows us immediately that the CIA is a rogue organization within the U.S. government and a severe threat to America.
In reality, the risk is worth taking — for three reasons: There is very little evidence the single market is worth the hassle of membership. It strengthens her negotiating position. And it can secure her Conservative Party a generation in power….In a landmark speech in London on Tuesday, Theresa May made it clear that Britain would not be looking for some form of half-in, half-out compromise. The U.K. won’t be part of the single market. It is unlikely to be part of the Customs Union. It won’t be subject to European law. In effect, it will end just about every formal tie with the Brussels bureaucracy. After 2019, Britain will have roughly the same relationship with the EU as the United States or Japan — a major trading partner, and a political and military ally, but no closer than that.
The rust-belt province of Liaoning fabricated fiscal numbers from 2011 to 2014, local officials have said, raising fresh doubts about the accuracy of China’s economic data just days ahead of the release of the nation’s full-year growth report. City and county governments in the northwestern region committed fiscal data fraud in the period, Governor Chen Qiufa said at a meeting with provincial lawmakers Tuesday, according to state-run People’s Daily. Fiscal revenues were inflated by at least 20 percent, and some other economic data were also false, the paper said, without specifying categories……Chen said the data were made up because officials wanted to advance their careers.