The Joke Quote

We've written before about using your purchasing power.

You are a consumer like the rest of us. They need you to buy stuff. It doesn't matter what the stuff is, essential or non-essential. You have a voice, you have power and, most of all, you have, however large or small, what they want, the green bills in your wallet or purse.

People, companies and governments as a rule don't do anything until forced. A classic example is the recent Mylan EpiPen controversy which brings us to our joke quote of the week. Granted it's only Tuesday. "Mylan understands 'deep frustration' with EpiPen costs," CEO Heather Bresch.

This is an insincere gesture, a joke because if they understood those price hikes would not have been implemented in the first place. In the second, they weren't going to rectify it without the current storm and backlash. This is only part of the CEO's quote, but the rest of it--"...we have always shared the public's desire to ensure that this important product be accessible to anyone who needs it"--is even  more insulting. Sure they have, at a price they have sufficiently lobbied the members of government  to sanction their getting away with.

This company's ties to Congress are closer than your next breath. And the members of that august institution should not get off free and clear. Those who received and accepted money from the company should be investigated about what they knew and when they knew it. Isn't that what the members of Congress do whenever someone from the private sector is called before them?

If you want some traction, use your purchasing power, your voice and the power of the boycott. The term boycott is broader than most realize and includes politicians.

Overnight

Forget Jackson Hole the focus has shifted now to this Friday when U.S. non-farm payroll numbers hit the news. Looked at by many as a sign whether jobs are recovering or still languishing is the next piece in the puzzle about where the Fed will head with interest rates.

The non-farm payroll numbers for August might ruffle more hawkish feathers at the Fed as the expected numbers for Friday are 180,000 job gains, according to a whole gaggle of economists, a figure below that last two reports for June and July of 292,000 and 255,000.

Such being the case is not  lost on international investors as Asian markets Tuesday rebounded after opening weaker. Four of five markets traded higher with only the Nikkei 225 off 0.9% at 16721.88 while the Hang Seng was up ).82% at 23007.62, the Kospi edged 0.525 higher at 2042.91 and the ASX 200 managed a 0.46$ gain at 5494.20. In China both the Shanghai and Shenzhen composites were flat with the Shanghai at 3067.95 and the Shenzhen at 2027.22.

The Japanese yen remained relatively weaker against the dollar, trading at 102.13 on Tuesday morning, compared with levels near 102.37 on Monday afternoon local time.Some positive news just ahead of the market opening in Japan, Reuters reported, had household sending only 0.5% versus the forecast of 0.9% decline, in when is a negative a positive in the topsy-turvy world called investing. The seasonally adjusted for for unemployment for Japan registered at 3.0% when gurus were looking for a 3.1% figure. Retail sales showed a similar decline from the expected figure, declining only 0.2%. The market was looking for a 0.9% falloff.

Japan is essentially at full employment with no end of the deflationary cycle in sight.This comes after the Japanese government has been buying up stock and bonds for years chasing the so-called wealth effect central banker loves to talk about. The dollar eased against the yen to 102.11 yen JPY= from a peak of 102.39, while the euro was slightly firmer at $1.1176 EUR=.

Gold held steady overnight at 1323.30.

What You'll Get

There are dumb statements and then there are dumber ones from economic elitist highbrows.

One of the dumbest we've seen of late is this gem from Harvard economics professor Kenneth S. Rogoff: "Almost 80% of the cash circulating outside financial institutions is in $100 bills."  Rogoff despises two things, your economic liberty and freedom of choice and cash. The two are connected tighter than Siamese twins.

Have you tried going very far today on a $20 bill? Not too long ago $20 would fill up your gas tank. Forget the current price of gasoline and it's many fluctuations. Or here's one better. Try taking a family of four out to dinner on two $20 bills. Let us know how that goes. Been to a major sporting event recently? Parking costs $20 and that's fortunately still in the same county where the event's being held. Don't try to buy any snacks why your there though. If you do you'll be surprise how quick they can make change of what's left of a $100 bill.

Checked lately the prices of services in the U.S.? In their global scorching searching for that magical 2% inflation target, there's a reason the Fed doesn't look there. Service prices are up astronomically. We won't mention the other obviously straw men nonsense Rogoff attempts to peddle. He's an academic, Jake. Knowing that alone is worth a $100 bill.

Since 80% of cash circulating outside institutions is $100 bills, most of it must be going to the vile underground economy, the one you need our protection from. Most of the franchise eating places in the U.S. will welcome that news. If you listen to government elitist shills like Rogoff and go gently into that cashless society they have planned for you, you deserve what you'll get.

Make sure you get your nose rings properly placed. It will be a bit less painful when you're tugged around in the cashless world Rogoff and his elitist friends have slated for you.

Gold Correlates?

"Let us be clear; we are not saying that gold will trade up to USD1,700/oz in the near term, but when viewed against the aggregated balance sheet of the 'big four' global central banks (the Fed, ECB, BoJ and PBoC) the argument can be made if we view gold as a currency, the metal is worth closer to USD1,700/oz, versus the spot price of USD1,326/oz." 

To be sure, this isn't an argument for gold as a currency, and there are arguments against that notion. For one, gold isn't a legal tender that's widely paid or received in exchange for goods and services, partly because it's not as easy to print or transport as paper cash. 

But the argument that Hsueh and Sporre make is that gold price percentage changes have historically moved in tandem with the rate of central bank balance-sheet expansions, but gold is not keeping up right now: 

Some analysts believe there is a correlation between the price of the yellow stuff and the expansion of central bank balance sheets. After last week's big focus on Jackson Hole the dollar has strengthened and gold prices softened. Earlier today gold futures were trading lower, 0.21%, or $2.75 an ounce, to $1,325.15. Fed Chair Yellen and Vice Chair Fischer did their best at the much watched meeting to let investors know higher interest rates were expected sooner than later. That would mostly likely signal a stronger dollar and softer gold prices, depending on how the market interprets such.

Though ZIRP might not yet be on the Fed's monetary policy radar, the Fed's balance sheet is set to expand. In fact, many believe the current sheet will never be balanced. Time, however, as usual will tell how much credibility investors think the Fed has left. We like gold here on further weakness for all the wrong reasons, according to MSM, and think if the Fed's remaining credibility gets any thinner it could become a late night weight loss infomercial

Read more:
businessinsider.com/gold-and-central-bank-balance-sheets-2016-8?




 

Overnight

It was a good start for the Nikkei 225 Monday as the index average soared 2.2 percent to 16,721.23 in midmorning trade, after rising as high as 16,737.95, the highest since August 17. As one market guru, according to Reuter, said: "It's not too difficult for the Nikkei to trade above the current 16,500 level. What the market wants to see is whether the U.S. economy is strong enough to stimulate investor appetite and the Nikkei to stay above the 17,000 level."

The U.S. dollar rallied pushing the yen lower and giving Japanese stocks a boost. The WSJ reports:
The dollar’s strength pushed commodity prices lower. Brent crude, the global benchmark, was recently trading down US$0.56 at $49.35 a barrel. In Australia, the commodity-heavy S&P/ASX 200 fell 1.1%, withWoodside Petroleum Ltd. falling 1.8% and Oil Search Ltd. declining 2.3%. Rio Tinto Ltd. and BHP Billiton Ltd. fell 1.2% and 0.4%, respectively.

After all the hullabaloo over Jackson Hole last week it apparently gave investors a sense of direction they believe will help clear up things. Another observer had this comment in the Jounal.

“All of the concerns and worries were addressed in [Ms. Yellen’s] speech,” said Alex Wijaya, a senior sales trader at CMC Markets.

Then when Vice Chair Stanley Fischer backed up Yellen's comments many believe that made the Fed's interest rate intentions clear removing much doubt. “I thought what Fischer said was a driver” of the currency moves, said Naoki Fujiwara, a fund manager at Shinkin Asset Management.

“He didn’t rule out the possibility of a rate increase in September,” said Mr. Fujiwara.

 U.S. stocks drifted lower on Friday on the news registering the market'a largest weekly decline since the U.K.’s vote to leave the European Union in June., the Journal reported. The yen in early Monday trading was off 0.3% against the dollar. In other markets, Hong Kong’s Hang Seng Index was recently down 0.4%, while Singapore’s Straits Times Index was off 0.7%., the Kospi was down 0.2% and gold was trading at $1317.60 an ounce

Want Names?

Want names?

Here they are, politicians who received money from Mylan, manufacturer of the now controversial epinephrine injection pen.

Most of the members as noted in the article investigating the natter had their pockets and palms greases by Mylan. So did the Clinton Foundation. This story appeared on CNBC a leftist MSM member of which there is little doubt. It's probably a token crumb from that network to try to show they're really objective. You will noticed  most of these--Grassley, Leahy and Schumer--are heavyweight long standing feeders at the public trough.

If you want to know what's sick with the nation, this is a good example. The most that will probably come out of this is these public servant rogues for hire will likely make a public announcement their offices have given the money back. Ain't that America.

A political committee for Mylan has donated to most of the Senate
 committee that has asked the drugmaker to explain price increases
 for allergy treatment EpiPen and could grill executives in a hearing 
on the matter.

The Mylan Inc. PAC has given $13,500 to four current members of
 the Senate Judiciary Committee since 2014, including $5,000 to 
ranking Democrat Patrick Leahy of Vermont and $5,000 to the 
Senate's likely next Democratic leader Chuck Schumer of New 
York. Since 1999, the PAC has donated more than $60,000 to 11 
current members of the 20-person judiciary committee. Most
 of those donations came after 2008.

This illustrates the reach of Mylan's political effort, which 
extended to candidates and political action committees in 22 
states between December, 2014, to the end of 2015. The Mylan 
PAC had $95,500 in political contributions for that period, while
 incurring $319,000 in indirect lobbying expenses as part of 
trade association membership.

The judiciary committee's chairman Chuck Grassley,
 R-Iowa, this week requested more information from Mylan about
EpiPen pricing amid furor over the its 400 percent cost increase in 
recent years. Grassley's campaign committee received a $5,000
donation from the Mylan PAC in 2006, according to Federal
Election Commission filings.

In all, the campaigns of Leahy and Schumer have received $15,000
 and $9,500 from the PAC, respectively.

Chris Goodney | Bloomberg | Getty Images

Heather Bresch, chief executive officer of Mylan
More: 
cnbc.com/2016/08/26/senators-probing-epipen-price-hike-received-donations-from-mylan-pac.

Prove It

 
There is little question that Google, the big search engine, is unabashedly covering for one of the presidential candidates in the upcoming election.

We are posting this on a Google blog and have been censored by them twice as we have previously written about here, not for anything that has to do for checking into anyone's health records since we are most likely more familiar than Google with HIPPA laws.

We noticed, though we have not been one checking the person in question's health care status on Google or any other website or search engine, that of late when we do type in that person's name for totally other reasons, how we are automatically directed to the person's campaign site. This appears a bit odd for a search engine that claims a certain sense of objectivity. It is also a very recent development.

The more MSN and outfits like Google do such the more they plant further seeds of suspicion that those records are hiding something that they don't want the public to know. There are also rumors afloat--and we emphasize the word rumors--Google was instrumental in helping the person in question with erasing certain e-mails.

Before we go any further let us note: we are in no way connected to any alt-right, left-right, right-left or such organizations or political party. If you think we are, we say to you prove it. This is were we are in this day and time. So we say to Google and anyone else, given the magnitude of the job this person is applying for, if there is nothing in those records the pubic would find disturbing or disqualifying, prove it.

Not just the American public, but the global public has a right to know.

The Time Has Come

 The Federal Reserve recently launched it own Facebook page.

That is these bureaucratic geniuses' idea about increasing their public transparency. No doubt a feeble jester to remove some of the heat they've been quite deserving of. So far from what we can gather it's been nearly as huge a flop as it's monetary policies all these seven long and growing years. A cynic might conclude, given their stumbling, bumbling record, there's little that could be too harsh to utter about this crowd.

The American Banker, a well-known industry outlet, dubbed the experiment "a disaster," according to sources. Eleven thousand likes were recorded the first week, a good sign one might think. But most of the responses have been  labeled "hates," as in what the hell are you doing to naming the bank the "root cause of all problems in the United States."

The disdain  for the Fed is alive and justifiably growing. Lowering and keeping rates artificially low for this long, they knew what choice they were making, pushing money shamefully into the hands of the wealthy and literally killing the retired, about to retire and the COLA crowd. It was a deliberate, calculating and, in the eyes of many, an unforgivable decision. We won't even bother to mention the poor and less fortunate.

Despite their expected denials they've created asset bubbles in several markets. Their interest rate policy has been a sharp officially-sanctioned petard to the left ventricle of savers. Talk abounds today about level playing fields. If this one were any more less level it would be a steep cliff. This data driven den of academics is at it again, suggesting that "the case for an increase has strengthened in recent months." Not only that, but two quick rate hikes might just be what the captain orders for dinner.

The BLS employment numbers are as phony as most politicians' promises. These numbers are simply an egress valve as in "How the hell do we get out of this mess?" As Nick Carraway points out in the first chapter of The Great Gatsby:  "Reserving judgment is a matter of infinite hope." Shuttering this miasma of monetary pretension and guidance once and for all is one hope the real people of this country in their infinite, unappreciated wisdom would be wise to demand.

The time has come.

The Harvard Mark

What do you know about the line "..at least for the foreseeable future" when you hear it?

It never becomes foreseeable. Now another Harvard elitist, economist Ken Rogoff, no stranger to dictating what the world needs now, you included, wants to do in not just your access to $100 bills, but $50s and $20s. In other words, a cashless society masqueraded as "a less-cash society" and here's that phrase again, for the foreseeable future.

These Harvard boys and girls never get tired of telling the rest of us how and what and, soon, where we ought to be living our lives. Most of this language is ensconced in how we need to protect you all from the evils that cash allows, like having any free choice in what you do with yours. So he throws a phony morsel to the anti-immigration folks--believing as is that of his kith and kin--they're too ignorant to see through his ploy.

Next he cites the benefits of "small transactions." That used to be something less than $10,000. Now it's suddenly shrunk to less than $20 bucks. If his semantic tactics were any more naked they'd be a nude model in a college art class. "There's little debate," he cites, "among law enforcement agencies that paper currency, especially large notes such as the U.S. $100 bill, facilitates crime...."  It also facilitates legitimate business transactions daily.

You can recognize these elitists by their arrogance and contempt. They constantly appear with their elementary school playground psychology and scaremongering, sure of themselves that you are so uneducated, one of their favorite terms, you will swallow it all without benefit of a chaser. What Mr. Rogoff apparently ignores is there's little debate, too, academic of otherwise, between arrogant elites like him and the rest of us. And because of people like him and his ilk, it's a growing global chasm that more and more people unlike him are welcoming. We have said this before and we'll repeat it. It's getting clearer and healthier by the day.

Six months since Larry Summers first suggested "it;'s time to kill the $100 bill," and three months after The ECB actually killed the €500 Note, another Harvard 'scholar' is reinvigorating the war on cash. Amid claims that paper money fuels corruption, terrorism, tax evasion, and illegal immigration, Ken Rogoff (ironically of "It's Different This Time" infamy) says the US should get rid of the $100 bill (and $50s and $20s) proposing, in his words, "a 'less-cash' society, not a cashless one, at least for the foreseeable future."
According to the esteemed ivory tower academic, paper currency lies at the heart of some of today’s most intractable public-finance and monetary problems. As Rogoff explains in The Wall Street Journal, getting rid of most of it - that is, moving to a society where cash is used less frequently and mainly for small transactions - could be a big help.
Rogoff's begins by stating factoids as facts...

There is little debate among law-enforcement agencies that paper currency, especially large notes such as the U.S. $100 bill, facilitates crime: racketeering, extortion, money laundering, drug and human trafficking, the corruption of public officials, not to mention terrorism. There are substitutes for cash—cryptocurrencies, uncut diamonds, gold coins, prepaid cards—but for many kinds of criminal transactions, cash is still king. It delivers absolute anonymity, portability, liquidity and near-universal acceptance. It is no accident that whenever there is a big-time drug bust, the authorities typically find wads of cash.

Cash is also deeply implicated in tax evasion, which costs the federal government some $500 billion a year in revenue. According to the Internal Revenue Service, a lot of the action is concentrated in small cash-intensive businesses, where it is difficult to verify sales and the self-reporting of income. By contrast, businesses that take payments mostly by check, bank card or electronic transfer know that it is much easier for tax authorities to catch them dissembling. Though the data are much thinner for state and local governments, they too surely lose big-time from tax evasion, perhaps as much as $200 billion a year.

Cash also lies at the core of the illegal immigration problem in the U.S. If American employers couldn’t so easily pay illegal workers off the books in cash, the lure of jobs would abate, and the flow of illegal immigrants would shrink drastically. Needless to say, phasing out most cash would be a far more humane and sensible way of discouraging illegal immigration than constructing a giant wall.

So to clarify - Cash (and Donald Trump) are at the center of all of America's and the world's ills and therefore - as a PhD who knows best - we must destroy it (for your own good)...

More: zerohedge.com/news/2016-08-27/harvard-professor-launches-war-paper-money.

Forget Zoro. It's the mark of Harvard.

EpiPen Follow Up

How do you know bad corporate behavior? Not very difficult if you care to look.

It's usually has a healthy mix of arrogance. Couple that with some insensitivity, greed and, as an article in this week's issue of Barron's points out, "executive tone deafness."

If only there were an emergency injection for executive tone-deafness.

Drugmaker Mylan (ticker: MYL), apparently unaware of the ongoing backlash against price gouging on vital medicines, raised the price of its EpiPen by 15% in May. That was two months after we recommended its battered shares (“Hurt by Valeant, Mylan Stock Could Rise 30%,” March 5) and only seven months after a previous 15% EpiPen price hike, which was rolled out immediately after a competing drug was pulled from the market.

EpiPen provides an emergency dose of adrenaline to those who can die from allergic reactions to things like peanuts and bee stings. Such allergies are on the rise. So is the list price of a two-pack of EpiPens, having jumped more than 500% to about $600 since Mylan acquired the drug in 2007. The latest hike stung more than earlier ones because drug plans have been raising co-payments, and patients have been switching to high-deductible plans with lower premiums but higher out-of-pocket costs.

This past week, just in time for EpiPen buying season as kids head back to school, the media and lawmakers have heaped scorn on Mylan.

“No one’s more frustrated than me,” Mylan CEO Heather Bresch told CNBC Thursday. But some people might be more frustrated—for example, anyone whose yearly pay hasn’t climbed 600% since 2007 to nearly $19 million last year, as Bresch’s did, on the back of all those EpiPen price hikes.

What to do with the stock? We liked it at $45. Now, at $43, we’re less enamored of it.

There's political overtones here. Big time. As we noted in a previous article. There's a global crisis afoot here. And as Dante said: the hottest places in hell are preserved for those who remain neutral in such times. You decide.