GOLDMAN SPEAKS

The now long gone Wall Street brokerage firm E.F. Hutton had a popular moniker in its day, something like: "When E.F. Hutton talks, people listen."

Well, given Goldman Sach's recent report, we'll see next year if the same applies to Goldman, the Wall Street house with close ties to the Federal Reserve.

CNBC is reporting cnbc.com/2015/11/24/goldman-sachs-no-stock-market-gains-in-2016 investors won't have much to look forward to next year when it comes to stock market gains.

Goldman Sachs analysts believe 2016 will have pretty much nothing to offer investors.

In fact, the firms' strategists forecast the year to end right about where it began, with the S&P 500 stuck at 2,100 amid a morass of higher interest rates, the end of margin expansion and a "bifurcated" market through which participants will have to tread carefully.

"We forecast the S&P 500 index will tread water for a second consecutive year in 2016," Goldman said in a report for clients this week. "In many ways our 2016 forecast is 'deja vu all over again.'"

The weak market will come amid little growth in fundamentals, with gross domestic product projected to increase just 2.2 percent in both 2016 and 2017 and a 10 percent rise in corporate profits but a plateau in margins at 9.1 percent. Goldman said the increase in profits will be "misleading" in part because of a reversal in this year's earnings story. Much easier comparables in energy, which is expected to decline 58 percent for the full year, will inflate the 2016 picture.

As they say, time will tell. But for the good contrarians out there, you might want to make up your own mind and consider fading that report. 

FUEL FOR THE FIRE

The WSJ described the incident over Syrian air space today as follows:

The Turkish government said its military shot down a Russian jet fighter along the Syrian border on Tuesday, in an escalation of tensions between Moscow and a key North Atlantic Treaty Organization member in the chaotic Middle East civil war.

A while back we pointed out when discussing weak energy prices that the globe was an unsafe place. And getting more unsafe by the day.That was before the Paris tragedy. You can talk about OPEC quotas, rig counts, oil-laden tankers languishing off the Caribbean coast and such all you want, but crude oil is still--as much as its sanctimonious critics deplore the black stuff--a critical part of the global equation.

The current incident, as many hope, will come and go without further problems. But the powder is there. And with an administration that now wants to put U.S. special forces at harm's door, the plot can ramp up even further. And no one knows just who or just what situation holds the match.

There's a couple of key points in that opening paragraph: "escalation of tensions between Moscow and a key North Atlantic Treaty Organization member and the chaotic Middle East civil war." There is two distinct implications there: chaotic and choosing up sides.

Televison talking heads and other self-appointed gurus are likely, like this clueless administration, well behind the curve on this one. Temporary situation or otherwise, don't exit your long oil holdings just yet. In fact, on any further weakness add to them.

OVERNIGHT

Reuters reported Turkey downs Russian war plane over airspace violation in Syria and Asian markets shares struggle.

Japan's Nikkei .N225 ended a choppy session with a 0.2 percent gain, after a long weekend. Markets were closed for a national holiday on Monday.

"We're post Japan Inc earnings now and the focus is back on China where local brokers are talking about market reforms, many of which have direct market impacts, which is important because China is a policy-driven market," said Gavin Parry, managing director of Parry International Trading."

There's also a continued focus on the U.S. Federal Reserve, with a lot of sell-side banter about quantifying what level of rate increase brokers are expecting," he said.

Chinese shares wilted, with the blue chip CSI300 index .CSI300 of the largest listed companies in Shanghai and Shenzhen off session lows but still down 0.2 percent, while and the Shanghai Composite Index .SSEC edged down 0.1 percent.

On Monday, Wall Street marked modest losses as Pfizer's (PFE.N) plan to buy Allergan Plc (AGN.N) in a $160 billion deal quickly drew criticism from politicians as a tax dodge.

SHOULD THE FED HIKE RATES NEXT MONTH?

Not everyone thinks the Fed should hike interest rates next month. The strong dollar has already hit emerging markets hard and that goes to some extent for U. S. multinationals. So has enough Fed members taken the attitude of "We gotta do something and we just don't care? It's time to act,"

"But even though the wonks at the Federal Reserve supposedly know the damage that a strong dollar is already doing to the global economy, they seem poised to make things even worse by raising interest rates in December…

Considering the tremendous amount of damage that has already been done to the global economy, this is one of the stupidest things that they could possibly do.

But it looks like they are going to do it anyway.

Most Federal Reserve policymakers agreed last month that the economy “could well” be strong enough in December to withstand the Fed’s first Interest rate hike in nearly a decade, according to minutes of its meeting Oct. 27-28.

The officials said global troubles had eased and a delay could increase market uncertainty and undermine confidence in the economy.The meeting summary provides the clearest evidence yet that a majority of Fed policymakers are leaning toward raising the central bank’s benchmark rate next month, assuming the economy continues to progress.

Considering the tremendous amount of damage that has already been done to the global economy, this is one of the stupidest things that they could possibly do.
But it looks like they are going to do it anyway.

It has been said that those that refuse to learn from history are doomed to repeat it. And right now so many of the exact same patterns that we saw just before the great financial crisis of 2008 are playing out once again right in front of our eyes. More:

  http://theeconomiccollapseblog.com/archives/the-u-s-dollar-has-already-caused-a-global-recession-and-now-the-fed-is-going-to-make-it-worse

OUR VIEW

Sending U.S.special forces into Syria is a colossal mistake by an administration noted for making colossal mistakes.

It will be a few years before those famous history revisionists get their hands on the history books, but by then most of you will know the truth and not be hoodwinked.

The current Syrian situation is one this administration yawned it usually indecisive yawn about a while back. Using the cover of the Paris tragedy, once again an administration that campaigned on bringing overseas American troops home and criticized a previous administration for it incompetent foreign policy in now trying to CYA.

That the American populace has tolerated such foreign policy incompetence, and that includes Benghazi where innocent Americans lost their lives, not just with this pitiful administration but several previous ones, is the real mystery here. It's a mystery that continues to be shrouded by MSM and their shills for Washington.

If the pen is indeed mightier than the sword, pick up yours and let your elected incompetents in Washington know exactly how you feel.

After all, 2016 is suppose to be what they call an election year. That's our view. We hope you know yours.

FOR THE NONCE

Well, we've all been cleared to consume genetically modified salmon, according to the WSJ.

Federal regulators approved the production and commercial sale of a strain of salmon whose DNA has been altered to make it grow faster, marking the first U.S. approval for a genetically modified animal raised for human consumption.

In case you 're wondering and we hope you're not, it's called agricultural biotechnology, something the Journal labels a milestone. The modified species is an Atlantic salmon developed by a Massachusetts firm that can grow to market weigh two times faster than the salmon nature provides or the farm raised variety.

If that smells like the odor of money rather than fish, your olfactory nerve is working just fine.

Some might hail this as good news. Others might take a different tact. One of  the things we know about cancer cells is that can multiply or grow much faster than ordinary healthy cells. It 's being marketed by its creators as a great thing for science and for consumers.

A gene from a larger Pacific Ocean breed of salmon gets implanted in the Atlantic species that increases growth hormone production. One wonders if any of the new species will eventually show up with acromegaly or a big head? There's enough of those to go around already in politics, media and Wall Street.

In most areas of sport, other than the clandestine world, artificially stimulating HGH is outlawed.

The environmental worry-wort crowd (They are never without their nervous-Nelly concerns; one could call it a human version of inbred GMO.) voices another concern, call it cross pollination as some of these genetic freak salmon escape into the natural waters and wipe what you and I know as natural species.

It's not like certain fish species didn't start disappearing from the globe before the climate change freaks arrived. We all have to make choices. What would you rather have, a bunch O2-spewing, coughing automobiles clumping around or herds of flesh-eating, fire-breathing dinosaurs?

For the nonce, we will pass on the GMO-altered salmon when it hits the market.

FALLOUT VERSUS SLOWING GROWTH

From the economic looks of things for 2016, the major EU economic engine, Germany, is expected to slow further next year. A report on MarketWatch today notes:

BERLIN--Germany's economy will grow less next year than in 2015 due to fading optimism in emerging economies and uncertainty about the consequences of the influx of migrants to Europe's largest economy, according to a survey from a leading German institute published Monday.

The growing uncertainty has prompted many companies to scale back their growth expectations, business-funded IW economic institute said.

"The series of years with modest growth years will continue," said IW director Michael Huether. "This is due to slowing export growth in an global economy marked by institutional uncertainties and restructuring."

The institute forecast growth of around 1.5% for next year, which is roughly in line with recent forecasts by other institutes but more pessimistic than the 1.8% forecast by the German government. For this year, IW estimates growth of 1.75%.

German Chancellor Merkel has a full plate at the moment with further fallout from the recent Paris tragedy and the already heating up controversy over the EU's open border policy. Many in Germany don't like it. And they're not lone. This is a sentiment that threatens the very core of the entire EU itself.
http://www.marketwatch.com/story/german-economy-to-slow-next-year-iw-institute-2015-11-23

TIME TO BUY?

High rated bond buyer says it is time to consider bank debt.

As an unprecedented era of rock-bottom U.S. interest rates comes to an end, finding a bond fund manager who will protect your money is more crucial than ever.

One of the best in the business says that, right now, there’s no better way to do that than by scaling back on Treasuries, betting big on U.S. banks and taking some risk in emerging markets such as Mexico. More:

www.bloomberg.com/news/articles/2015-11-23/best-bond-trader-says-wager-on-wall-street-as-fed-liftoff-looms

POLITICAL BRASS KNUCKLES

Twenty-sixteen is a presidential election year. So it shouldn't surprise that the political brass knuckles are coming out.

The dangerous, iron hand of left wing intolerance recently rolled out it's political brass knuckles in a threat to stifle liberty and free speech when current presidential candidate Hillary Clinton went after some Hollywood comics who poked fun at her in a video.

We say Hilary went after them even though it was reportedly a high ranking Hillary campaign official because we don't think she'd get away with another Bengazi-I-Didn't-Have-Any-Knowledge-Of-It defense.

Here is the full story from.zerohedge.com.

The one upside of Hillary Clinton becoming President, is that her endless stream of stupidity will result in more content for this writer than I could ever imagine.

Hot off her recent debate performance in which she claimed that the reason she is owned by Wall Street is because of 9/11, her aides are now demanding a Hollywood comedy club take down a video of comedians mocking her.

Just in case you have any doubt about what a Hillary presidency would look like, we learn from Judicial Watch:

In what appears to be a first for a serious presidential contender, Hillary Clinton’s campaign is going after five comedians who made fun of the former Secretary of State in standup skits at a popular Hollywood comedy club.

A video of the short performance, which is less than three minutes, is posted on the website of the renowned club, Laugh Factory, and the Clinton campaign has tried to censor it. Besides demanding that the video be taken down, the Clinton campaign has demanded the personal contact information of the performers that appear in the recording. This is no laughing matter for club owner Jamie Masada, a comedy guru who opened Laugh Factory more than three decades ago and has been instrumental in launching the careers of many famous comics. “They threatened me,” Masada told Judicial Watch. “I have received complains before but never a call like this, threatening to put me out of business if I don’t cut the video.”

Masada told Judicial Watch that, as soon as the video got posted on the Laugh Factory website, he received a phone call from a “prominent” person inside Clinton’s campaign. “He said the video was disgusting and asked who put me up to this,” Masada said. The Clinton staffer, who Masada did not want to identify, also demanded to know the names and phone numbers of the comedians that appear in the video. Masada refused and hung up. He insists that the comedy stage is a sanctuary for freedom of speech no matter who is offended. “Just last night we had (Emmy-award winner) Dana Carvey doing Donald Trump and it was hilarious,” Masada said.

The last time we checked, the video was still up and running. Profiles in Courage was a Pulitzer Prize winning book attributed to the late President John F. Kennedy, though in truth much of it was ghost written by one his close high ranking colleagues. It was a book mostly about historical brave political people and their role in the founding and development of this nation.

It's refreshing to know there are other courageous profiles of ordinary Americans out there today who refuse to concede their liberty or freedom of speech, others who refuse to be intimidated.

Someone out there knows the name of that high ranking campaign person. Do yourself, your country and the American people a service. Publish it.

Maybe there's some more decent material there for those Hollywood comics?

zerohedge.com/news/2015-11-19/hillary-clintons-aides-demand-comedy-club-remove-video-making-fun-her

UPDATE ON PFIZER INVERSION

More from the weekend about the Pfizer inversion deal.

Under the terms of the proposed transaction, the businesses of Pfizer and Allergan will be combined under Allergan plc, which will be renamed “Pfizer plc.” The companies expect that shares of the combined company will be listed on the New York Stock Exchange and trade under the “PFE” ticker. Upon the closing of the transaction, the combined company is expected to maintain Allergan’s Irish legal domicile. Pfizer plc will have its global operational headquarters in New York and its principal executive offices in Ireland. For more:

http://www.zerohedge.com/news/2015-11-23/its-official-allergan-pfizer-combine-biggest-ever-tax-inversion-defy-jack-lew