Is This The Face Of A Hate Crime Criminal?

 
We've said for a while now the problem isn't deflation facing the central banks, particularly the Fed, it's the possibility of slow growth coupled with rising inflation, otherwise known as stagflation.

Despite the Fed's famous search for that magical 2% inflation barometer, the Fed has it's sneaky way of keeping real inflation indicators out of the gauges it uses to track inflation. And this is not new. For those of you who have no recall of that kind of scenario, stagflation, it's one where precious metals   usually do well. Your purchasing power doesn't. Now stagflation doesn't happen very often. In most cases somebody has to really screw up to cause.

Consumers have been blamed for many things since this last economic meltdown, most recently their failure to spend to help revive growth. This is a Keynesian canard that people think worked in the 1930s and that it will work again.These are indeed contentious, to use a soft word, times with few signs of any abatement in sight. Yet consumers have enormous power by exercising their collective purse strings. They can refuse to purchase anything but essentials. They can reject the coming cashless society. The can demand no further watering down of their purchasing power by monetary authorities.

If you are one of the ones unfortunately existing on fixed or retirement income these zero and negative interest rates ladled out are not only contemptuous they have decimated your purchasing power. These incompetents at the Eccles Building chose to bail out their Wall Street friends and leave you and yours twisting in the wind. These actions are all part and parcel of the in-crowd, the establishment. 

Make no mistake. There are no racial, religious or party barriers here whether you are brown, yellow, black or white. They couldn't care less. They only pretend to care. Look around. You'll see this is a global problem. The ruling elites know exactly what they want. And they count on you to continue not knowing what you want. More of the same is as far away from having a better life than you and I are from becoming the queen or king of the United Kingdom. We understand the Queen's jewel collection is quite stunning, however.

Without villains there's no need for heroes. What the in-crowd is best at is creating villains, what use to be called divide and conquer. Who they are dividing and conquering is you and me. And if you're dumb enough to play their silly polling game every four years, we'll all get what we deserve, divided and conquered. What the world needs now is not more love, it's a global political enema. The same old faces with with  the same old receding hairlines, the same old pancake make-up, the same old lies.

You have to give it to them. Their cunning, their packaging, their success, we just keep buying and swallowing it. Either that or we're pretty dumb. Mitch Stewart, the elitist Hillary strategist, called Trump supporters "stupid white people."  Does that mean, Mr. Stewart, in your estimation, the black people who support your Caucasian candidate are stupid Oreo Cookies? This is the divide and conquer rhetoric they want you to fall for. You're better than that. The real truth is it's the Mitch Stewarts, white, black, brown or yellow, on both sides of the aisle, who see you that way, not for what you really are, decent, hardworking people trying to live your life out in your own best way without interfering or harming anyone.

We read somewhere else he was quoted as saying he hated stupid white people in general. Now we're not attorneys but that sounds like discrimination and hate speech. He is singling out a large segment of the population that happen to be members of a particular race for supposedly trying to exercise their freedom of choice when it comes to voting. His rhetoric seems to carry a hateful glare to it. Is this a hate crime.?  There just could be some enterprising lawyer or two who want to file the case.. When ignorant people kept all those African Americans from voting in the South for all those years, they were afraid of two things--a difference of opinion and a possible changing of the guard.

Meanwhile, we have a message for Mr. Stewart and his fellow travelers. We're white, not necessarily Trump people and we might be stupid. But we don't think so. One thing is certain, sir, we're here and we have no plans to move.  You, sir, can try to put whatever elitist spin on that you want. We'll still be here.

Now for that stagflation scenario, here is another sign, the weakness of  durable goods orders.




zerohedge.com/news/2016-07-27/durable-goods-orders-crash-most-2-years-longest-non-recessionary-streak-declines-us-

Overnight

Despite the Nikkei 225 rebounding 1.3% overnight Wednesday from its Tuesday losses, it's still a wait and see game for many Asian investors until Friday to find out how much if any stimulus package the Bank of Japan will announce. Rumors floated around the market today it would be something like six trillion yen or $57 billion in direct fiscal outlays over the next few years, a local newspaper reported. Though less than the 10 trillion expected, the hope for some kind central bank easing policy from the BOJ's two day meeting that ends Friday still exists.

In other markets the Kospi was flat at 2,026.93; the hang Send edged 0.3% higher; the Australian ASX 200 was off 0.1% after being up in earlier trading; the Shanghai composite and Shenzhen both surrendered small losses. The yen traded at 105.12 against the dollar after Tuesday's close of 104.64.

What happens in Japan is critical in the eyes of many not only because the nation's been in a long economic funk but there are continuing signs global growth remains weak and just last month the OECD projected slower growth as a sign all the monetary policy moves might not help and could even make the slowdown worse.

Hardly Alone

The dilemma the Fed faces--besides just being genuinely incompetent and the horrible ramifications that can have on ordinary peoples' lives--is they raise rates and growth remains slow.

Part of their reason for raising rates anyway is to give the impression they will have some breathing room should Katy have to try to bar the door. Millions of American lives center on pension returns either now or in the immediate future. And public pensions like those in California, Illinois and New York are huge with huge obligations and in many case huge deficits.

The Fed's excessive monetary stimulation policies proves once most things can bite two ways. According to the Wall Street Journal, "Pension Returns to Hit New Lows," "Connecticut now allocates 10% of its budget to pay down unfunded pension liabilities that more than doubled over the past decade."  To be sure, there are other causes for this turmoil, mostly politicians who in good times kick pension funding obligations down the road in the name of their favorite giveaways, but that decade also coincides with Fed policies.

One thing we know if things go down the drain, politicians will deny the blame. And that leaves those bureaucrats. Chicago, the city Carl Sandburg once described as "hog for butcher of the world...City of Big Shoulders," has enough problems to make a preacher cry. A homicide rate that gets manipulated more often the Fed jobs data, a growing exodus out of town and, yes, a "$20 billion pension hole" giving its fund a junk rating.

And there's more. A lot of people once they retire move away from where they spent their working careers. States and municipalities take a dim view of that for the most part, showing their attitude you made it here you should spend some of it here as more seek to tax these contributions. These pension liabilities are another way to spell bubble. And bubbles are becoming so frequent  today, so many of them, they're difficult to keep track of.

Now politicians, bureaucrats and academics will no doubt destroy reams of paper, recycled or otherwise, debating and defining what's a bubble. An obligation coming due  seldom meets their criterion. The common lie these so-called fiduciaries tell is short term volatility matters little. It's the long term that counts as these people have a fondness for relying on the future to bail them out.

But as the Journal notes there's been a drop in 20-year annualized returns, those same numbers insurance and annuity firms used to love to quote before the 2008-09 crisis. Long term expectations and performances have suffered from two recessions and abnormally low interest rates over the last  15 years. All three of  these entities--pension funds, insurance and annuity sellers--depend on steady long term returns to meet their needs.

Two California funds, the largest in the U.S. By assets, managing a combined $484 billion for 2.6 million public employees and retirees, saw their 20-year returns target fall below 7.5% to 7.3% for one and 7.1% for the other. Taxpayer or workers are usually on the political hook for funding any shortcomings, the Journal notes. But here's the real rub according to the Center dot Retirement Research at Boston College: "Every one percentage drop in investment returns represents an increase of 12% in liabilities."

So if you think social security is a landmine waiting to be detonated, it's hardly alone.

We Like Charts Too

We like charts as well as the next person. Here's one the implications of which, if they hold true, a lot of investors might not like so much however. We came across it at davidstockmanscontracorner.com/chart-of-the-day-crash-warning-household-net-worthdpi-at-2000-and-2007-highs



 It's only a chart and there's no cardboard sea to sail over here. It could turn out to be make believe, but at least you've been warned.

Overnight

As we wrote over the past weekend, two central banks meet this week, the Fed and the Bank of Japan. This seemed to make Asian investors somewhat nervous overnight as the Fed's two day meeting opens Tuesday. Though no change in interest rates are expected, investors will be parsing Chair Janet Yellen's words for clues.

Meanwhile, Reuters reported, the Nikkei share average dropped on Tuesday morning to a 1-1/2-week low as Wall Street languished and the dollar fell against the yen ahead of the U.S. Federal Reserve's two-day policy meeting, hurting exporter shares.

The Nikkei fell 1.3 percent to 16,400.47 in mid-morning trade, after falling to as low as 16,344.34, the lowest level since July 14. Exporters were sold after the dollar slipped 0.9 percent against the yen to 104.87, with Toyota Motor Corp shedding 1.5 percent and Honda Motor Co sliding 1.7 percent.Traders said that uncertainty over the Bank Of Japan's policy decision at its two-day meeting starting Thursday is making investors risk averse.

By mid-day the Nikkei was down 1.6% while the yen was up strongly. hitting of 104.77 at one point. In Hong Kong the Hang Seng Index rallied 0.9%, the Australian ASX 200 fell 0.2%,, the Kospi traded up 0/4% as second quarter GDP grew faster than expected, 3.2% on the year, versus 2.8% for the previous quarter.The Shanghai composite Index was up 0.5%. In other markets oil prices were up with Brent crude trading up 0.4% and gold down 0.3%.

Wednesday and Friday are the two big days with investors starting to doubt any massive changes in monetary policy since last week both the Bank of England and the ECB held steady. This coupled with what one trader observed:  "[Japanese] fiscal stimulus looks less bold, and we aren’t sure if [Bank of Japan Gov. Haruhiko] Kuroda will ease further." The Japanese plan calls for spreading any stimulus over several years which would lessen the initial impact on markets, according to one source.

Integrity

Why we like gold.

Most of MSM and the entrenched hate it. Or at least that's what they claim.

One of the largest Dutch banks, ABN Amro, has now warned its business clients a negative interest rate on the business accounts is in the works. The bank is currently updating its terms and conditions and will more specifically include its right to reduce the interest rates below zero as the bank wants to ‘protect itself’ against the continuously changing market circumstances.

Remember Debbie Wasserman Schultz, the Florida Democrat Congresswoman, DNC chair and those
WikiLeaked emails.

Integrity.

She incidentally is up for re-election in Florida this fall. We wonder how the rabble feel about that.

On top of that, people might have forgotten (but we haven’t) that ABN AMRO was –as far as we know- the first bank which defaulted on its obligation to deliver physical gold to some of its clients. Even those clients had the right to redeem a certain investment in physical gold, ABN didn’t honor this commitment and offered those clients a payout in cash rather than delivering the metal which it originally promised to do.

So we have a bank controlled by a government that wanted to repatriate its gold, which is now proposing to reduce the interest rate below zero? We don’t believe in coincidences.

Integrity.

 

Here's a link.zerohedge.com/news/2016-07-24/it-begins-dutch-bank-abn-amro-will-charge-negative-interest-deposits

As another poster recently put it: If you can't touch it, you don't own it.

Educated Points Of View

They say people who can make a living doing what they love are blessed. If you get paid to pen this drivel,"The Perils of Populism," that's a good gig, man. If I were you I'd hold onto it.

I was wondering as I read when you'd roll out one of your profession's favorite terms, visceral. In your vernacular that means: bereft of reason; ill-rational, lack of common sense. When are you people ever going to stop hiding behind semantic covers, get enough testosterone to stand up straight, high water blue jeans or no, and tell the rabble what you really think of them: a hoard of knaves and dolts who spent most of their lives reading public bathroom graffiti instead Ricardo or Samuelson. If your contempt and arrogance were any thicker, sir, one would need a chainsaw to cut it.

But you don't disappoint with this next gem. "Against such emotion it's very difficult," you say, "to introduce studied reflection to the discussion."  One can only marvel at how long it probably took you to come up with that beauty. Concrete?  Abstract? It's a real cutie. And quite obviously it's in the province of only the chosen few.

There are other schools than the ones you note. Two that we know of both begin with the letter S: Streets and Survival, ones we have a nudging feeling you wouldn't excel at. Those are the streets where most of the rabble you and your elitist brethren are so contemptuous of spend most of their existence trying to survive.

It's generous that you grant them your permission. "It's certainly proper and desirable for citizens to question the existing order. And there are certainly policies to aid economic growth and allocate it proceeds equitably," you write. You've nicely set up your straw man here, sir. You're are so subtle. "But we will try to look at things dispassionately." One assumes that "dispassionately," like "studied reflection," is another genetic gift limited to those chosen few. It isn't nerdiness that's a disadvantage to your profession, sir. It's the pseudo-science itself and its pitiful track record. Life teaches many things. One of them is all talk in all breakups ends at some point.

Peddlers come in all sizes, shapes and occupations. Economics is no exception. A better, more accurate title for your piece would've been "Peddling the Perils of Populism." This is just an observation and intended as nothing more. But in case you've yet to notice, the gauntlet in the sand is down. And it's a global gauntlet. Thank whatever powers might be you and your kind are on the other side because it is fruitless to try to introduce studied reflection to the discussion.

advisorperspectives.com/commentaries/20160723-northern-trust-the-perils-of-populism

We publish the link to this article by Carl Tannenbaum of Northern Trust so you can read it for yourself and decided who is out of touch with whom. Northern Trust of Chicago is a firm noted for catering to its wealthy clients, no crime in that, just a fact. But to borrow one of economists' favorite ploys and hedge a bit, there might be some snootiness there.

Speaking of hedges, note Mr.Tannenbaum's last sentence in the article's second paragraph: "But the population's complete detachment from educated points of view could be an unfortunate overcorrection."

Few things in life are given, but here is one: Any time one differs with the educated entrenched, one is completely detached.

Threat No Part

If you look at the recent WikiLeaks, like them or otherwise, you can see they are attempts to demonize. In this case Hilary opponent Vermont Senator Bernie Sanders. Now to put it mildly we're hardly Sanders supporters. But that's not the point.

With the threat to the global ruling elites growing, the demonizing continues to grow. There remains many suspicious questions around the recent tragedies in Nice, Orlando and Dallas, to name just a few. The truck that supposedly mauled to death 84 innocent people in the pictures we saw showed no blood on it. The bullet holes were prominent. Now one can say why show the world such a horrible site. But one can just easily say, why not? There were plenty of disturbing pictures of bodies in the street just as there were in the recent Munich tragedy. Just today another story in southern Germany broke about a supposed Muslim hacking to death a woman with a machete.

We've said before the globe is up to its earlobes in debt, much of it never going to be repaid. That debt is as much a threat to the ruling class and their control as any Islamic threat. One favorite way to wipe out debt is to create wars. We know that following the tragic WWI America was an isolationist nation. Former Princeton professor Woodrow Wilson's attempt's to create the League of Nations failed miserably. It mostly forgotten that Wilson did something no American president had ever done before--personally went to Versailles to argue his case. Sort of reminds of another U.S. president a short while ago setting another precedent by going to the UK to personally persuade another nation's voters.

The American people were in a deep isolationist frame of mind. One of the most noted isolationists of the era was Charles Lindbergh, Lucky Lindy, whose child was kidnapped by a German. FDR and Churchill tried their damnedest to bring America in to the European conflict. Roosevelt sent supply ships to England that were repeatedly torpedoed by German U-boats, but the American people failed to bite. The 1890s had there "Remember the Maine." Laying ground work takes some time.

There is more than sufficient evidence to suggest that Pearl Harbor was planned. That might be hard for Americans to swallow, but we don't know any decent person who saw that huge hole in the ground in New York City when those twin towers collapsed who found that easy to swallow either. One could argue that incident more than anything led to one of this century's greatest fantasies so far, the creation of WMDs.

You might like or hate the demonizing of Trump. We don't have a pony in that race. We're just like a modern-day de Tocqueville, traveling through this dimension. And what's clear to us, as it turned out in the French Revolution in the end, today's demonizers can easily become tomorrow's demons. What's also clear to us is many of the global leaders today are too insular, too obtuse or just plain too arrogant to realize that if this whole thing comes crashing down, like another once admired world leader, they could be only one lamp post away from a similar fate.

One thing we know about people when they disagree with you is they tend to put words or meanings into what you say or write. We know what we wrote here and what our intention is. Threat is no part of it. Just fact.

The Upcoming Week

The upcoming week is interesting. On Monday the Democrat Convention, WikiLeaks and all, in Philadelphia begins, Gilead Sciences and Kimberly Clark announce their earnings; and Secretary of State John Kerry attends a summit to put the world all at ease about the South China Sea turmoil.

Tuesday brings the Case-Shiller home prices report for May and the June new home sales; consumer confidence for July and the biggie, the Federal Open Market Committee begins its two-day meeting when the focus will center on will they or won't they and when, a game Fed watchers by now are quite familiar with. For what's it's worth, the consensus is they won't until possibly September. What would this all be without that word, possibly.

Durable goods day for June is Wednesday; another biggie here, the FOMC ends its gathering and announces its decision on interest rates, giving a whole lot of underemployed Fed watchers something to contemplate and gaze over for a few days besides their navels. And who would want to miss this, the President will address the Democrat convention. There's no word yet whether he'll discuss those WikiLeaks.

Thursday is Hilary day as she accepts the mantel as the Democrat nominee for the upcoming fall slugging match. Stand-up comics should take note, this fall promises much good material for your future gigs. We understand John Steward will be tied to his television with some kind of bungee cord. CBC, Dow, Ford and some others report earnings.

And finally, Friday, (Whew! That's a long week.) it's second quarter GDP time. We know most could hardly wait. This, too, is more navel contemplating material for those underemployed Wall Street savants who are mostly frustrated wannabe English majors who love parsley with their daily reading fare. The Bank of Japan speaks on, guess what, interest rates as many economists--you recall those people, the ones who so accurately tell us what all the nuts and bolts mean--expect a new round of monetary stimulus. Not to be upstaged, a San Francisco Fed governor speaks out on--get this topic--"What's Left in the Fed's Tool Kit." The Fed owns a tool kit? And the same day the Dallas Fed President breaks some bread with New Mexico bankers. Well, they don't call it the Land of Enchantment for nothing.

That's A Given

The Los Angeles Times recently allowed one of its columnist to write that a Trump victory and follow-up presidential misstep would seemingly justify a military coup. This is indeed inflammatory language at a deeply inflammatory time. The Times needs to print an explanation for its reckless editorial actions. We hope this writer didn't sincerely mean that. But the Times needs to publish its position on such.

Recently, Americans had to endure a Supreme Court justice spewing forth her personal, hateful political views publicly. Most of us grew up knowing they, being human, had their their personal views but being leaders and public icons had the will power and decency to keep them private. It lent the system, phony or otherwise, an air of impartiality. Once out of the bottle, however, that genie is pretty tough to get back. Over the years we've had radio and television personalities who make no public claim to probity lose their jobs for a lot lessor offenses. In the name of any shred of human decency, RBG needs to take a clue from one of her fellows socialists, Mr. Hollande, and pull her own personal Brexit.  Resign now.

Our contrarian take is a Hilary victory will fuel the flames of anger, resentment and rage more as she and her Wall Street elite friends try to take us closer to one world government, one world currency and global socialism. People around the globe are rebelling against absentee landlord rule.

The system is rigged and more and more are awakening to it. The proximity between the Eccles Building in Washington and Wall Street is more than just geographic as one writer quoted in this weekend's Barron's: "Wall Streeters  have told Trump to 'cool it' in his criticism of Federal Reserve Chair Janet Yellen." Any pretense that the Fed is an independent entity is just that--pretense.

The biggest risk today is for the entrenched elite to overestimate the public's tolerance and patience. People are pissed off, deeply pissed off:  Overtaxed, underrepresented and marginalized, much it owing to the last several years of political correctness. Glass ceilings, to be sure, are limiting. But at least they were once there, a goal one could aim for however limited. What exists now is a profound and quite possibly irreparable chasm between the rich and the poor. And in case the rich are unaware of it, the poor outnumber them quite seriously.

In the the past several months there have been several articles about the rich building their hideaway caves, plotting their escapes. This in itself is an admission of quilt. Underemployment is a serious problem and the robots are not all here yet. Brexit, Trump traction, global push back against centralized authority are just symptoms of the nasty underlying disease that infests society on a world scale today. The big dogs showed up earlier and scared the Scots from exiting the UK.

But the big dogs are losing their influence quicker than Hilary changes her positions. The so-called democratic process has a bad case of pernicious anemia globally. The name calling, epithet-labeling from MSM  and both of these bankrupt political parties is a good way to maybe win a battle but lose the big skirmish. The gauntlet is down. People get it. And contrary to MSM propaganda, it cuts across all racial, religious, educational and party lines.

Feelings run deep. The last time this nation witnessed such a major division on such a major scale was a bit over 150 years ago. Few squabbles ever match the bitterness and acrimoniousness of family ones. That's a given.