Extremely Careless

Anybody want an "extremely careless" babysitter? How about an "extremely careless" plummer or proctologist?

In medicine there is a game that gets played called damning by faint praise. That's when a department chief wants to get rid of a poor performing intern or resident and writes him or her a letter of recommendation to send his or her butt somewhere else. It's an anywhere but here letter. Poor fund of medical knowledge is another term.

Employers do it and so do school teachers. We don't know if the birds and the bees do. But now we know the FBI does. That's what they called Democrat presidential hopeful Hilary Clinton after supposedly perusing her e-mails when she was Secretary of State. The implication was one of impropriety otherwise called breaking the f.....g law.

Now that that's all cleared up we can all rush out and finally elect an "extremely careless' President. We don't know about you, but we feel less angst already. We've not, thank God, attorneys and we have it on good report that some attorneys still mention God, not in vain of course, but we think there is something in law labeled negligence.

Now we haven't looked it up. Maybe some barrister will send it to us. But to our non-Ivy League pedigree rube commodity-trading ears, those two things sound fungible. And that brooks another question: Are "extremely careless" people on one job "extremely careless" on the next?  But before you get all upset and start thinking about changing your mind whom you're going to vote for this November, let us put your mind extremely at ease. We must admit, however, it extremely troubled us, too.

This should make you feel extremely better. We came across one of those double blind crossover peer reviewed studies only extremely real scientists do and, with all respect to the New England Journal of Extremely Real Medicine, here are the reassuring results. There is one caveat we should tell you. It was a relatively small sample. Probably too small to be extremely significant. Only a million participants.

For every 998,000 "extremely careless" workers, two were not "extremely careless" in their next position. But here the best part. So you can stop worrying. We just found this out. One of the questions aspiring proctologists are asked when applying to their programs is: "Are you 'extremely careless."


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Overnight

Taking their lead perhaps form Wall Street, Japanese equities fell overnight as global uncertainty seems on the rise again with the British pound taking a pounding at one point hitting $1.2874 in Asian trading before recovering slightly.

The Nikkei dropped 3.1% as the yen strengthened, sending shivers through Japanese exporters who get rocked in the exchange rate differentials. The Nikkei has staged a six-day rally though Monday as investors assumed central banks would further easy monetary policy. The Kospi shed 2.1%, the Australian S&P 200 declined 1.3%, the Hang Send Index lost 2.0% and the Shanghai Composite Index was off 0.2%. All of the Topix's 33 sub-sectors were also in the red.

The pound's downfall hit a 31-year low and comments by Bank of England Governor Mark Carney didn't help when he revealed the bank would not be able to offset all of the economic turmoil. Pain or the prospect thereof sends investors flocking to safer ground and that is what happened as they moved into the yen, Asia's perceived safe currency port in rough times. July 14 becomes now a watershed moment unless something changes before then as that's the date of the next UK MPC meeting and where investors expect Carney to change monetary policy.

News out of China was not that comforting either as Monday, one agency reported, Chinese Premier Li Keqiang noted it would not be easy to achieve a growth rate of 6.7 percent in the first quarter. Some economists feel China is headed for a depression once all the economic skeletons are out in the open. Meanwhile, the dollar moved higher against a basket of currencies and gold rose to $1,367.56 an ounce up from $1,320 last week. In Japan, the yield on the 10-year Japanese government bond fell as much as negative 0.271 earlier in the session before climbing back slightly to negative 0.269.

 

Economic Euthanasia

Generals so they say are noted for fighting the last war.

You might not want to think of it this way, but central bankers deep down see themselves as generals.
And this group has been furiously fighting deflation like they've never seen it before. And they haven't.  Most new diseases they claim take a while to run their course. It's running that course a few thousand or so cases that allows one to assign an average time.

Average times have different names, incubation is just one. Denouement is another. That leaves all that middle ground stuff. A lot of people believe WWII is what took America out of the depression. Others, mostly Keynesians, fantasize it was FDR's programs. The truth as it has a way of doing probably hides someplace in the middle.

So you want to take notice of the rise of bellicosity going on around the globe today. There are too many places to name, but with a little effort you find them. The move to create a cashless society is just one. There are more subtle moves going on like destroying pensions and veteran benefits. Government's only resources are what they take from others, be it land, benefits or money. Global governments need money. They want the money.

A friend's father is 94 years old. He's a 100% service connected veteran in a government paid nursing home the administration contracts with as it does for hundreds like him across the nation. The home where he is has been in business 58 years. That means it's passed a gaggle of Veteran's Administration inspections over the years until this year.

What happened? Who knows. But the Veterans Administration sent a 30-day notice letter to my friend saying her father would have to be moved pronto at her expense. The home didn't pass inspection and the VA has a one and done inspection policy. No fixing the problem. No second chances. That's peculiar because if one knows anything about Veteran facilities they are given--and have been--multiple chances to fix problems. In fact, problems are Veteran facilities' stock and trade.

Now her father is demented and has been in the facility for several years. Neither he nor his daughter chose the facility. The Veteran's administration did. Approved by them, chosen by them. So it's clear that whatever happened is not the fault of neither her nor her father. She lives over 1,000 miles away, makes frequent trips at her own expense to see him. By the time she received the rubber-stamped letter it was already a week old.

Most professionals worthy of the name will tell you older, demented seniors do poorly in unfamiliar surroundings. In other words, they decline faster. During the past eight years this administration froze social security and other COLAs twice under the phony guise there was no inflation. Each time for two years. That's four out of the eight years this crowd has been around.

During that time rents have soared and so has the real cost of eating. Likewise, the cost of healthcare for seniors. Some might call that economic.euthanasia.

Without Warning

The search for yield has been the main theme for investors and it has been for a while now.

After a torrent of monetary easing from global central banks to make even a hard core nymphomaniac say: "Enough already!" the cries for more continue. As the WSJ reports today four sectors of the S&P 500 are higher than they were at the start of the Brexit vote. Those four--utilities, telecom, consumer staples and health care--should tell you more than you want to know.

The first thing is growth is like the honest soul Diogenes with his lantern went searching for--non-existent. The second is that silly 2% inflation target global central bankers have been chained to also remains non-existent, for now. Smart traders supposedly take the other side of a trade few want. That rules out most ordinary souls because most have been brought up in ordinary ways. Don't stand out. Fit in. Go to an Ivy League school.

After more than 20 years of deflation one might suspect that hot water bottle is getting pretty cool. We remember a well-known Treasury bond trader buying 30-year bonds years ago yielding 14-15%. He's now in that other dimension but most likely trading bonds. But back then he still had enough testosterone on board to tell everyone, including MSM mavens, what he was doing.

Nothing braggadocios. Just straight forward talk. It was about as unpopular then as the sniveling, driveling wealthy elite are now. He was in New York. The guffaws were so loud one could hear them in Puget Sound. As far as we know he never did it. But he probably years later wanted to cop a page from Nigel Farage who stood in front recently of all those stunned EU bureaucrats and told them to their faces: "You're not not laughing now!"

We suggest, and that's all anyone can really do--so hold your guffaws for another time, that's an approach you might want to take to this market. Overlook all the numbers-cranking palaver and focus on human behavior. It's like the weather. It can change without warning.

We Guess Not, Joe

 
Just when you think things can't get any funnier, guess what? They do.

The recent uproar about Democrat presidential hopeful Hilary Clinton's government e-mails has brought out many quotes ranging the gamut. But the one we find perhaps the most hilarious (no pun intended) is this one from Vice President Joe Biden.

Now Biden has a known reputation for saying some dumb s....! He also has had his share of run-ins with alleged plagiarism and, to put it kindly, telling the truth. Ready: "I find it," Biden was quoted, "hard to believe Hilary would do anything 'intentionally' wrong."

We guess not, Joe.

We were at a soiree a few days back, you know, one of those evening parties where people stand around outside in groups drinking cocktails and telling stories, when we heard a guy in the group next to us relating in an excited voice how he just won a $1,000 in an online contest. The crux of contest was you were to submit your idea of your worst nightmare. The guy's wining entry, from what we could tell, went like this.

You awake one morning and before you've rubbed all the sleep out of your eyes, you realize you're sitting on the stand, in a courtroom, on trial, being prosecuted for a lack of veracity. But just as you clear all the sleep and focus around the room, you see your attorney standing in front of the court, calling Joe Biden as your star character witness.

We guess not, Joe

Rigged

Trust is a fragile thing. Once lost it's hard to restore.

Brexit symbolized just that though many are still in denial and refuse to accept it. Today's FBI announcement is yet another example. And here's yet another in the short span of less than two weeks.

It's hardly a secret that global economies are in deep trouble. Many countries either are already bankrupt or are wallowing in debt that can't and will never be paid. Central banks around the globe--see, e.g., Japan for just one instance--have less credibility than a street peddler with an armful of Rolex watches.

Gold and silver prices, as you know of late, have been on a tear. Tears whether in one's pants on in markets strike fear. Often lots of it. Especially in high places. Read this about gold and you'll know just how afraid the entrenched are.

The oil patch isn't the only place rigging goes on.

.zerohedge.com/news/2016-07-05/here-they-come-again-precious-metals-traders-see-third-smackdown

Overnight

Thin volume was expected owing to the U.S. holiday and it didn't disappoint overnight Monday in Asia. With the decline in concerns about Brexit, Japanese shares rallied for the sixth straight day, its longest winning streak since November.  The Nikkei 225 was up 0.6% to 15,775.80 before falling to 15,638.52, down 0.87%. Other markets followed suit with the Kospi down 0.38%, the Hang Send off 0.64%  and the Australian ASX 200 fell nearly 1%. The Shanghai Composite traded positive 0.40% as activity in the service sector for Chinese small and medium companies move higher. The Caixin Purchasing Managers' Index (PMI) for June was at 52.7, compared with 51.2 in May, marking the fastest increase in 11 months. Levels above 50 indicate expansion.

Australia's softness stems in part over an election that might still be contested as most big banks there took a hit.The ASX 200 has a large component of financials. With the U.S. closed for holiday investors focused on Europe where stocks finished lower with FSTE 100 off  0.8%. In Europe the scaremongers were at it again as reported by CNBC.

The International Monetary Fund chief, Christine Lagarde, told a French newspaper on Monday, meanwhile, that exiting the EU could cut Britain's gross domestic product by between 1.5 and 4.5 percentage points by 2019. Additionally, ratings agency S&P Global Ratings said both the euro zone and the U.K.'s economic growth would take a knock as a result of the vote, with the agency warning that the U.K. would barely escape a "full-fledged recession caused by Brexit."

Oil traded lower with Brent at $49.75 a barrel  while U.S. futures edged down 1,22% at $48.39. Gold, considered by some the safe haven of last resort, lost some of its recent luster, trading at $1,344.16 and ounce. Japanese 10-years bonds with yields already in negative territory falling as low as -0.264
before settling at -0.237.

Overnight

Asian shares rose overnight based more on sentiment or hope than anything else since investors look for more monetary easing in the days ahead to pump up global economic growth. Monetary easing usually translated into higher equity prices.

Much of the hope focuses on Japan which has an election later in the week that though considered a minor one could take on greater impact given that Abenomic has not revived the Japanese economy and investors are restive. Hope as they say springs eternal and the U.S. is not immune where it looks as if following the Brexit saga the Fed will be forced to hold its fire on interest rates until they do what they do best, wait to read more tea leaves. Such would damped any upswing in the U.S. dollar. We like the idea of a surprise rise in agricultural commodities going forward that nearly everyone seems to be ignoring given the weaker dollar.

The Nikkei 225 was up 0.4%, the Kospi edged ahead 0.2%, the Hang Send Index gains 1.8% and the Shanghai Composite matched the Hang Send rising 1.8%. Meanwhile, much of the focus shifted to Australia where the dollar there faded early only to recover later and concerns about control over Parliament suggest a possible paralysis in policy. Reuters reported, the Australian dollar was slightly higher at $0.7495 AUD=D4, off session lows but still below Friday's one-week high of $0.7504.

The British pound edged up 0.1 percent to $1.3289 GBP=D4, nursing its losses after its 11 percent plunge to a 31-year trough of $1.3122 a week ago following last month's Brexit stunner.
The U.S. dollar took a breather ahead of the holiday, with the dollar index steady at 95.630 .DXY, but it remained pressured by a fall in U.S. Treasury yields on Friday that saw the benchmark 10-year US10YT=RR yield briefly touch a four-year nadir.
After gaining nearly 9% in June, gold rallied further overnight, up 0.5% at $1,349.20 an ounce partly on the post-Brexit news and partly over just plain uncertainty. A weaker dollar should help gold as the Fed appeared to be stalemated once again about interest rates. Silver also enjoyed a good month of June, breaking $20 an ounce for the first time in two years. Silver last traded at $20.43.


 

Chance Of Lifetime

Everyone has a worst nightmare.

For a long time many people suspected MSM polls were smelly. Now most know that's the case. Pure rotten might be a more accurate description, but today's Sunday so we'll try to be on our better behavior.  Brexit helped beyond any doubt to prove that. Last week we came across two polls after what we call the Brexit Affair that announced Hilliary ahead of Trump by double digits. Another one claimed her lead was seven points.

What many are trying to disconnect is the Brexit-Trump connection. If true--and it is--that spells trouble for the Clintonista crowd. It also scares elitists to their globalism core. Here's a story, if accurate, that will scare them even more for its worst nightmare dimensions. For years we've claimed Democrats viewed African-American voters as a monolithic block. In other words, taken for granted. It's been one of America's greatest political personal insults. The other has been the behavior of Republicans until now.

Scanning through several Trump interviews going back nearly a generation you won't find xenophobia, homophobia or racism. What you'll find is opportunity. And if you can do the damn job, you'll get the damn job. Two large segments of this nation's population, African-Americans and Hispanics, proved a long time ago they do can do the damn job. Yet they've been owned by one party.

While you're out there asking questions, MSM, somebody ought to ask one about that. And here's another one. With the exception of the status quo, who among us isn't looking for a chance of a lifetime?

zerohedge.com/news/2016-07-03/black-trump-supporter-exposes-truth-about-black-vote

Forget The Bouncing Ball

One of the popular MSM memes post-Brexit making the rounds is what The Daily Bell recently described as "voters rejected the 'expert class'--a globalist vision in other words."

This is hardly new. But those so-called self-appointed savants, usually Ivy-league pedigreed who would have you believe such, are more disingenuous than those they accuse.

There's an irony here many are missing, especially from those elitists who criticize the so-called rubes who voted to leave the EU. The globalist view is about elitism and their shrine of expert class they believe infallible and love to genuflect before. One hundred or so of them recently signed a petition scolding those who oppose GMO food sources, ordering them to stop it with this checkmate: We're scientists!

After all, isn't that what experts are all about, always being correct. The chosen possessors of superior knowledge. Magna cum BS. One of the storied heroes, though his record for many reasons turned out blotchy--to use a kinder, more gentle term--these global elitist worship is JFK.

After the disaster of the Bay of Pigs, Kennedy was well quoted for his comment summarizing the situation. This coming from a good Harvard man. It appears a lot of those rubes were listening.
Happy Fourth of July. Forget the bouncing ball. Keep your eye on your individual independence. Never be fooled by elitist crocodile tears.