March 3: Daily Contrarian Reads

An Ides of March Moment—The Stage Is Set

Whether or not one agrees that the Federal Reserve is preparing to raise rates again at its upcoming meeting this March, one thing is certain: The Fed. has done everything shy of setting its hair-on-fire to leave little doubt that they are seriously considering it. As of this past Friday the consensus (or odds) for such a possibility stood in the high 30’s signaling little to no chance. On Monday those odds started to nudge up ever so slightly, yet, by late Tuesday those odds were pushing past the 70’s and heading for 80. Guess what happened next?

Thanks for the Bailouts! World’s Biggest Banks Fined $321 Billion Since Financial Crisis

Banks globally have paid $321 billion in fines since 2008 for an abundance of regulatory failings from money laundering to market manipulation and terrorist financing, according to data from Boston Consulting Group. That tally is set to increase in the coming years as European and Asian regulators catch up with their more aggressive U.S. peers, who have levied the majority of charges to date, BCG said in its seventh annual study of the industry published Thursday. Banks paid $42 billion in fines in 2016 alone, a 68 percent rise on the previous year, the data showed.

Behold, the SNAP Market! Opens at 75X Sales And $15 Million per Employee

Having priced at $17, Snap Inc. opened for trading at $24, valuing the company over $34 billion – almost three times the size of Twitter, bigger than both HP and CBS, and almost as big as Ebay……Losses greater than revenues make for “hard math to work with” for investors, George Maris, portfolio manager at Janus Capital, says on Bloomberg Television.

Inside The New Yorker’s Hysterical Red Russia Baiting—–Some Truths The Liberals Ignore

Beginning with its cover image menacingly featuring Putin, Trump, and the magazine’s title in Cyrillic letters, along with its lead cartoon dystopically depicting a UFO-like Red Square hovering over and phallically invading the White House, the article is largely devoted to what has now become standard — and very profitable — fare among East Coast newsmagazines: feeding Democrats the often xenophobic, hysterical Russophobia for which they have a seemingly insatiable craving. Democratic media outlets have thus predictably cheered this opus for exposing “Russian President Vladimir Putin’s influence on the presidential election.”But featured within the article are several interesting, uncomfortable, and often-overlooked facts about Putin, Trump, and Democrats. Given that these points are made here by a liberal media organ that is vehemently anti-Trump, within an article dispensing what has become the conventional Democratic wisdom on Russia, it is well worth highlighting them.

Mind The Fed Doves—-They Are All Sprouting Black Feathers

Yesterday, Fed dove Lael Brainard, member of the Fed’s Board of Governors, told a Harvard University audience not only that the fed funds rate should be hiked “soon,” but also that unwinding QE and shrinking the Fed’s balance sheet should enter the discussions…..San Francisco Fed President John Williams said a rate hike would be seriously considered at the next meeting and that he sees no reason to wait any longer. On Tuesday, another inveterate dove, a very influential one, New York Fed President William Dudley said that the case for a rate hike has become “a lot more compelling.”

Better Than Bernie—-JPMorgan’s Trading Desk Lost Money On Just Two Days In The Past 4 Years

Naturally, any time banks purposefully “adjust” or otherwise obfuscate a number, it usually means that the actual, unadjusted number reveals a very different picture, and not surprisingly, the same is true regarding JPM’s trading record. Conveniently, during JPM’s investor day yesterday, JPM Investment Bank CEO Daniel Pinto presented a 25 page breakdown which among other things, contained the answer. According to the following chart on page 12, not only did JPM not have a single losing day in all of 2016, but JPM’s trading desk also had zero daily losses in 2014 and 2013. It did, however, lose money on two days in 2015. Prior to that one needs to go all the way to 2012 to find 7 days in which the largest US bank by market cap posted any losses.

Trump’s “Moderate” Defense Secretary Has Already Brought Us To The Brink Of War

Did you know that the Trump administration almost went to war with Iran at the start of February?Perhaps you were distracted by Gen. Michael Flynn’s resignation as national security adviser or by President Trump’s online jihad against Nordstrom. Or maybe you missed the story because the New York Times bizarrely buried it in the midst of a long piece on the turmoil and chaos inside the National Security Council. Defense Secretary James Mattis, according to the paper, had wanted the U.S. Navy to “intercept and board an Iranian ship to look for contraband weapons possibly headed to Houthi fighters in Yemen. … But the ship was in international waters in the Arabian Sea, according to two officials. Mr. Mattis ultimately decided to set the operation aside, at least for now. White House officials said that was because news of the impending operation leaked.”

Draghi’s Dilemma: Eurozone Inflation Hits 2% with Italy on Bond Life Support

Eurozone headline inflation hit two percent today, and that has the inflation hawks in Germany screaming. Yet, ECB president Mario Draghi has promised to maintain QE asset purchases, and Italy has no other real buyer for its bonds.

AG Jeff Sessions—Likes The Smokes But Not The Weed

The good citizens of America can finally sleep well at night. Jefferson Beauregard Sessions has swept into the Attorney General’s office and vowed to save our youth from the horrors of reefer madness! Don’t worry everyone, it’s for the kids. Here’s my question. Where was Jefferson back in the late 1990’s when it came to saving kids from the very well documented mass murderer known as cigarettes? He was shilling for the industry of course.

Trump’s Health Care Air Ball Tuesday Night Just Tightened The Tangle

The lack of detail was still glaring, and Trump either skirted the alligators lurking in the morass of Affordable Care Act repeal and replacement, or just poked them with a long stick. The process remains as chaotic as ever. That’s a threat to health insurers who focus narrowly on government programs. It may also hurt those who don’t.