Wednesday, May 14, 2025
Home Blog Page 67

Trump v. Clinton: Stocks can predict the winner

0

Forget the polls. Wall Street has another way to predict whether Donald Trump or Hillary Clinton will be the next president of the United States.

Keep an eye on the stock market from August 1 through October 31.

presidential election

If stocks go up during that three month stretch, expect Clinton to win. If stocks slide, Trump will likely prevail.

Those critical three months have been astonishingly accurate at predicting the next president, says Sam Stovall, a stock market expert at S&P Global Market Intelligence.

Stovall looked at the data for every presidential election going back to 1944 (FDR v. Dewey). If stocks rose in price from July 31 to October 31, the party that currently controlled the White House won the election 82% of the time.

This year, the key stretch will start on August 1, since July 31 is a Sunday.

Similarly, if stocks (measured by the S&P 500 index that tracks the performance of 500 of America's largest companies) fell, voters opted to kick out the party in power and replace it 86% of the time.

"We all know that prices lead fundamentals. And more times than not, S&P 500 price returns identified whether the incumbent president, or his party, was reelected or replaced," wrote Stovall in his report on elections and the market.

The basic idea is that if the economy is growing and people think the good times will continue, they are likely to want to stick with the same presidential party (in this case the Democrats). If they are fearful, stocks tend to fall, and voters want new leadership.

The only times that the stock market predictor didn't work were in years where a strong third party candidate was involved (e.g. 1968 or 1980) or when there was a surprise geopolitical shock like 1956 when England and France seized the Suez Canal from Egypt.

The third party factor could be make Election 2016 more difficult to predict too. Libertarian Gary Johnson has been polling around 10%.

The stock market is coming into the "presidential predictor stretch" near all-time highs. Wall Street experts have very mixed views on whether it can go up more from here.

Goldman Sachs: Avoid stocks for next 3 months

0

 

Goldman Sachs thinks the good times may be over for stocks for a little while.

July was great for the market, with the S&P 500 rising nearly 4% and setting seven record closing highs. Fears about Brexit faded, allowing more than 90% of investors to make money last month, according to data shared exclusively with CNNMoney by Openfolio.

But Goldman Sachs is warning that stocks "remain expensive and earnings growth is poor." The influential investment bank downgraded stocks to "underweight" over the next three months.

"Until the growth situation improves, we are not that constructive on equities, particularly after this type of rally," Goldman strategists wrote in a report Sunday.

Growth concerns were magnified on Friday, when investors learned that the U.S. economy grew at sluggish 1.2% pace between April and June. That sobering GDP report dashed hopes for a spring rebound from the first quarter's anemic 0.8% growth pace.

Dow bounces back Brexit

Stocks may be more vulnerable to disappointing news because of how far they've climbed lately. The Dow is currently sitting at 18,400, or roughly 3,000 points above its mid-February low. That's a huge move.

Goldman isn't going out on a limb by warning of possible turmoil in the next few months. History shows the August/September period can be rough for stocks. Those two months are the worst for the S&P 500 in terms of monthly price increases since World War II, according to S&P Global Market Intelligence.

The challenges may be greater this time around. Not only does growth remain elusive for much of the globe, but there is a lot of uncertainty about policy. Goldman cited the Brexit negotiations in Europe, China's attempt to manage its slowdown and the looming presidential election in the U.S.

The other problem is that stocks look pricey. The S&P 500 is trading at 17.87 times its projected earnings over the next 12 months, the loftiest multiple since June 2004, according to S&P.

The bulls are hoping that earnings, the real driver of stock prices, will catch up to the market. While tech companies like Facebook (FB, Tech30) and Amazon(AMZN, Tech30) have reported blockbuster profits, the S&P 500 is still on track to report its fourth consecutive quarter of shrinking earnings.

Even if profits don't rebound, the markets have been supported by extremely low bond yields that make stocks look cheaper by comparison. But many worry that bonds are in the middle of a massive bubble that will eventually reverse.

All of this explains why Goldman Sachs is advising clients to put money into cash. Some investors are doing just that. The average Openfolio portfolio in July held 10.3% in cash, up from 8.2% in May.

But Goldman isn't telling people to keep their money under the mattress. The firm remains neutral on stocks over the next 12 months and told investors to "look for opportunities to re-enter upon pullback in equities."

ES Morning Update August 3rd 2016

0

c2777d0d-c84c-4425-9e72-245d970a54f2

Cracks in the Dam finally showed up yesterday as the market broke-down on the trading range it was stuck in for over 2 weeks.  However, today should be a green close from the looks of the short term chart.  We have a new falling trendline now on this 60 minute chart of the ES Futures, which is small resistance.  The larger resistance is up at the 2170 level of course.  There resistance in the 2155-2160 range too, as it was support but now it's resistance.  As for the wave counts... the move up from the low yesterday looks like a small A wave up and the move back down into this premarket session is likely a small B wave.  That leaves the C wave up yet to come, which should happen early today.  Whether it breaks through that falling trendline or not is unknown, but if it can't then the bulls are weaker then they appear and it sets up tomorrow for a break of the 2140 support zone.

The 6 hour chart looks like it's trying to turn back up but we might see a breakdown of 2140 first if the bulls can't get back into that chop zone today.  The 60 minute chart of the SPX Cash also favors the bulls as it is trying to turn back up.  However, since it's only a 60 minute chart it only favors the bulls for today and mainly in the first half of the day.  But that could be put off until late in the day if we see the futures drift down slightly early today and NOT take out yesterday's low, as then they could push the MACD's down deeper on the 60 minute chart of the SPX Cash and allow them to push up late in the day.  The only problem is that the 60 minute chart on the ES Futures is already up from -5 to just under zero right now and late in the day it should be overbought and wanting to rollover.  This is where you have the futures and the cash wanting to go different direction, which usually ends up in a choppy sideways day until the both realign together in the same direction.

Ok, so we have mixed charts today between the ES Futures and the SPX Cash... meaning that we probably won't see a breakdown today or a move back up into that trading range the futures have been in forever... at least it seemed like forever.  This suggests a "pause" day, which is common for Wednesdays' I've noticed as a direction is usually picked on Monday or Tuesday of any week and continues (usually) into Thursday or Friday of that week, but Wednesday's are the day the market rests and realigns charts.

As far as the news, we have the Jobless Claims number on Thursday and the Employment Situation on Friday.  Either of those reports (or some of the other reports released) could move the market... up or down.  I think we'll go down but nothing is guaranteed in life and if too many other traders think the same as me then you know I'm on the wrong side.  Anyway, back to what's happening today... a flat "pause" day looks likely with more bullish alignments then bearish, suggesting a green close.

Norway to create world’s first floating underwater tunnel (VIDEO)

0
© NPRA

The Norwegian coast may be beautiful but with more than a thousand fjords cutting into it, getting from one place to another often requires lengthy journeys.

Norway’s Public Roads Administration (NPRA) has an ambitious plan to solve the problem by building the world’s first floating submerged tunnel system about 30 meters (100ft) underwater.

© NPRAThe $25 billion project will allow vehicles to travel under the Norwegian Sea avoiding a 21-hour drive along the coastline.

The route from the southern city of Kristiansand to Trondheim in the north currently includes seven ferry crossings. As most of the waterways are wide with the largest a mile deep, it is not feasible to construct a traditional bridge. The tunnel would shorten the trip to just over 10 hours.

The first-of-its kind structure will be made up of two 1,200 meter (4,000ft) curved concrete tubes, floating up to 30 meters (100ft) below the surface. The tubes will be supported by pontoons on the surface and kept stable with connecting trusses. For extra stability, the construction might be bolted to the bedrock as well.

On the surface, there would be wide gaps between the pontoons to allow ferries to pass through.

© NPRA

The first underwater tunnel will connect Oppedal and Lavik, passing through the 1,300 meter (4,300ft) deep, 1,000 meter (3,300ft) wide Sognefjord.

Traveling along the new route would feel like driving through any other tunnel, according to Arianna Minoretti, a senior engineer with the NPRA.

A fjord at sunrise, west of Drammen, Norway © Bob Strong

The submerged construction will be able to cope with rough weather that is typical for the country, according to NPRA. It will also allow easier access to rural communities.

“Having this connection means that people there do not have to wait for a helicopter to go to the hospital,” Minoretti says.

The project is planned to be completed by 2035, and will preserve the landscape for those who still want to take the scenic route, the agency says.

Nick Denton Files for Bankruptcy, Just Weeks After Gawker Did

0

Nick Denton, chief executive and founder of Gawker, in court during the company’s trial against Hulk Hogan in March.

Nick Denton, the founder and chief executive of Gawker Media, filed for personal bankruptcy on Monday to protect himself from a legal judgment awarded in March to the former professional wrestler Hulk Hogan in an invasion-of-privacy lawsuit.

“Ever since the verdict, this was a likely outcome,” Mr. Denton said in an instant message.

Gawker, which faces a $140 million judgment, filed for Chapter 11 bankruptcy in June and put itself up for sale. The company will be sold at an auction that is expected to occur later this month.

Filing for bankruptcy puts a stay on claims from creditors, including court judgments, meaning Hulk Hogan, whose real name is Terry G. Bollea, will not be able to collect his award.

Gawker is appealing the judgment made by a jury that awarded Mr. Bollea $115 million in damages and $25 million more in punitive damages. Mr. Denton is personally liable for $10 million and jointly liable for $115 million.

“I don’t have that kind of money lying around,” Mr. Denton said on Monday. “In fact, almost all my net worth is in the independent media business to which I have devoted my working life the last 14 years.”

In May it was disclosed that Peter Thiel, the billionaire Silicon Valley entrepreneur, had secretly financed Mr. Bollea’s lawsuit. He said he was also funding other legal cases against the company.

”The time has come for Nick Denton to accept responsibility for the decisions he made and the rewards he reaped based on the suffering and humiliation of others,” David Houston, a lawyer for Mr. Bollea, said in a statement. “His bankruptcy has nothing to do with who paid Mr. Bollea’s legal bills, and everything to do with Denton’s own choices and accountability.”

Mr. Bollea sued Gawker Media, Mr. Denton and Albert J. Daulerio, the former editor in chief of Gawker.com, in 2012 over Gawker’s publication of a tape that showed Mr. Bollea having sex with a woman who was the wife of his former friend. Mr. Daulerio, who was ordered to pay $100,000, is also expected to file for bankruptcy.

In his Chapter 11 bankruptcy petition, Mr. Denton listed $10 million to $50 million in assets and $100 million to $500 million in liabilities.

Mr. Denton’s bankruptcy filing, which was long anticipated, is nevertheless the latest blow to Gawker, which he founded in 2002. The company has faced numerous challenges in the past year, including the departure of two top editors after Gawker published, and then removed, an article about a married male media executive who sought to hire a gay escort.

Still, Mr. Denton said his personal bankruptcy would not have much of an effect on Gawker, and he painted an optimistic portrait.

“For the company, this does not mean too much,” he said. “I am committed to finding the brands and the people a secure home, free of this vendetta. The bids are due in two weeks, and the operation is in great shape, with growing traffic and revenue.”

In a memo to the Gawker Media staff, Mr. Denton praised the company for keeping its “focus and momentum.”

“What really lifts my spirits is the way in which we have stood together and just kept on writing, coding and selling,” he wrote.

Is Donald Trump Jewish?

0
UNITED STATES - MAY 23: Grand Marshal Donald Trump marches in the Salute to Israel Parade on Fifth Ave. (Photo by Ron Antonelli/NY Daily News Archive via Getty Images)

Grand Marshal Donald Trump marches in the Salute to Israel Parade on Fifth Ave.

http://mileswmathis.com/trump.pdf

As usual, this is just my opinion, based on private research Readers have been begging me to do Trump, but I don’t think this is what they expected or wanted. Many have been fooled by him. I really don’t have much to say about this bozo actor, except to say that he has been one more test of the gullibility of the American public—a test they have failed. Even those who don’t like him have been fooled into thinking he is real person. He is about as real as Dudley Do-Right or Rocky the Flying Squirrel.


Hmmm...

Now I don't know too much about the ranks of those that join the Free Masons but I do know that many high ranking elites are 33rd degree Masons.  But is there a title inside them that is called "Grand Marshall"?  I don't know?

I will say that I don't believe that Trump became a Billionaire without doing something crooked.  Maybe he's not a Free Mason?  Don't know?  But he's well connected to all of the known gangsters out there... whether they call themselves Free Masons Cone-heads , Skull and Bones Idiots, Child raping Catholic Criminals, or Illuminati light bulbs!

This Trump guy is still the lessor of two evils between him and Killary but lets face it... neither are worth voting for.  Where's the check box on the ballot that says "None of the Above"?

Red

ES Morning Update August 2nd 2016

0

f816dd41-7e5d-4d68-9720-512c59374deb

You want the good news first or the bad news first? (for bears only)  Well, I'll give you the good news... and that is "The ES Futures DID NOT breakout to the upside last night".  Now the bad news... the futures have now made a 3 wave pattern down (ABC), and this 60 minute chart looks like it "could" turn back up on it's MACD's anytime now.

Ok, it's got small bear flag on it but with this light volume everyday it doesn't have high odds of "sticking" even if it does breakdown.  Then there's the ABC pattern up from the 7/28 low of 2153 to yesterdays' premarket high of 2177... which could be a larger A wave up and the ABC pattern down to this mornings' low a larger B wave down?  That leaves a 5 (or 3) wave pattern back up for a larger C wave.  Not good for the bears.

So, we bears need that small bear flag to play out in a big way and not just barely drop.  It needs to take out the 2150-2155 support zone to make those ABC wave patterns incorrect.  On the SPX cash it's still mixed but it's acting like it wants to turn back up on its' 60 minute chart.  These patterns don't support some crazy new rally to 2300 but more like 2185-2190 (on the futures).

The DOW is a problem too for the bears as it's had 6 red closes in a row and is overdue for a green close.  Plus it's been pulling back some while the S&P500 trades sideways, which means it's working off the overbought conditions faster and it's pushing the short term charts into oversold conditions.  All in all it's going to take some news event to save the bears.  Not that the bulls are winning here either as looks like only the market makers are... from commissions of course.

The bottom line is simple... it's another "Ground Hog Day" until support is broken on the downside (and sticks of course) or the upside.  There's no more good clues today then yesterday or the day before on the direction of the market as short term wave patterns suggest up and the bear flag suggests down.  The only thing the bulls and bears have in common right now is their theme song in this football game... and that's "Hold the line" by "Toto".

Tesla, SolarCity may announce merger today

0

Elon Musk is CEO of Tesla, chairman of SolarCity and the biggest shareholder in both companies.

Tesla Motors Inc. said it would buy solar panel installer SolarCity Corp. for $2.6 billion in shares to form a one-stop clean-energy shop.

The combined entity will offer consumers solar panels, home battery storage systems and electric cars under a single brand. "Solar and storage are at their best when they're combined," the companies said in a blog post on Tesla's website.

Tesla expects to achieve "significant" cost savings and "dramatic improvements" in manufacturing efficiency as a result of the acquisition of solar panel installer SolarCity, Tesla CEO Elon Musk said today.

He said the combined companies will have a "stronger balance sheet," but likely will require a "small equity capital raise" next year. Both companies have been burning through cash and have projected achieving positive cash flow later this year.

Tesla and SolarCity expect to save $150 million in costs in the first full year after the deal closes as the combination would improve manufacturing efficiencies and reduce customer acquisition costs. Musk said he thought the combined companies could "significantly exceed" that mark in the first year.

Combining the electric car maker with the solar panel installer is a major part of Musk's strategy, who earlier in July unveiled his "Master Plan, Part Deux" that calls for the combined company to offer consumers a single source of hardware to power a low-carbon lifestyle.

Musk is CEO of Tesla, chairman of SolarCity and the biggest shareholder in both companies. A merger agreement had not been certain because SolarCity formed a special committee to review Tesla's offer independent of the influence of Musk and other executives close to him.

Under the agreement, Tesla would hold 93.5 percent of the combined companies and SolarCity 6.5 percent. The deal is expected to win approval in the fourth quarter, the companies said.

The deal includes a "go-shop" provision that will allow SolarCity, which had market value of $2.62 billion as of Friday close, to solicit offers from other buyers through Sept. 14.

Musk has argued that combining Tesla with SolarCity will allow the combined company to reach consumers more effectively, installing solar panels on their roofs, sending power to Tesla storage batteries in their homes, and Tesla cars in their garages. Batteries from Tesla's $5 billion gigafactory outside Sparks, Nev., will be central to the combined enterprises.

Tesla shareholders have gradually warmed up to the deal with SolarCity following initial apprehension after Tesla announced its offer on June 21. After dropping to below $190 per share following the offer, Tesla shares have recovered and ended trading on Friday at $234.79. SolarCity shares closed at $26.70 Friday.

Besides Musk, several Tesla and SolarCity executives, including Musk's cousins, SolarCity CEO Lyndon Rive and SolarCity board member Peter Rive, have recused themselves from voting their shares when the deal comes to a vote.

Tesla is scheduled to release its second-quarter results on Aug. 3.

The company said earlier this month that its deliveries for the quarter fell short of its forecasts. Analysts will be looking for signs that the company is containing its costs and slowing its cash burn.

Tesla took a hit on June 30 when the U.S. National Highway Traffic Safety Administration disclosed it was investigating a fatal accident that killed the driver of a Tesla Model S while he was using the car's Autopilot system, which takes partial control of steering and braking Since then, Musk has defended the Autopilot technology.

MARKET SNAPSHOT: U.S. Stocks End Lower As Crude Oil Re-enters Bear Market

0

Tesla and SolarCity fall after reaching merger deal

U.S. stocks lost momentum to finish mostly lower Monday as crude-oil futures returned to bear-market territory and weaker-than-expected manufacturing data raised doubts about the strength of the economy.

The S&P 500 shed 2.76 points, or 0.1%, to close at 2,170.84 after the large-cap gauge hit a record intraday high of 2,178.29. A 3.3% drop in the energy sector dragged the S&P 500 into negative territory, outweighing modest gains in health-care and tech stocks.

The Dow Jones Industrial Average fell 27.73 points, or 0.2%, to close at 18,404.51.

However, the Nasdaq Composite Index climbed 22.06 points, or 0.4%, to end at 5,184.20, boosted by appetite for tech giants, including a 1.8% jump in shares of Apple Inc. (AAPL).

Meanwhile, losses for crude snowballed, with the U.S. oil benchmark dropping almost 4% and at one point trading below the key $40 level amid worries about a supply glut and subdued demand. Crude oil is now off 21.8% from its peak of $51.23 a barrel hit in early June, signifying a bear market, or drop of at least 20% from a recent peak.

On the economic front, the Institute for Supply Management's closely watched manufacturing index for July fell to 52.6 from 53.2, while construction spending fell 0.6% in June. The Markit manufacturing purchasing managers index for July rose to 52.9 compared with June's 51.3.

"People are nervous as oil crashes below $40, given the context of the weak GDP report and somewhat weak ISM data.  They are back to doubting whether the market's rally is as strong as it could be," said Bruce McCain, chief investment strategist at Key Private Bank.

Prospects for a near-term interest-rate increase by the Federal Reserve have faded since the weak GDP reading on Friday.

Corporate quarterly results will continue to feature prominently this week even as the season winds down, though no major companies reported Monday. So far, about two-thirds of S&P 500 companies have announced quarterly results thus far, with 71% beating on earnings and 57% reporting revenue above estimates.

Fed speakers: The market appeared to brush aside comments from New York Federal Reserve Bank President William Dudley and Dallas Fed President Rob Kaplan, who both argued at separate events Sunday and Monday that an interest-rate hike this year shouldn't be ruled out .

Stocks to watch: Shares in Tesla Motors Inc.(TSLA) and SolarCity Corp.(SCTY) lost ground on news that the companies have reached a merger agreement. SolarCity also released updated guidance.

Meanwhile, Chinese ride-sharing giant Didi Chuxing Technology Co. has agreed to buy the China operations of Uber Technologies Inc.

Uber and investors in its UberChina unit will take a 20% stake in Didi. UberChina is backed by China's search giant

Baidu Inc. (BIDU). Didi's backers include e-commerce group Alibaba Group Holding Ltd. (BABA) and internet giant Tencent Holdings Ltd. (0700.HK)

Shares of Fleetmatics Group PLC. (FLTX) soared 39% on news of a pending acquisition by Verizon.

Energy stocks were the biggest losers in the S&P 500, with all shares in the sector finishing in the red. Murphy Oil Corp.(MUR), Williams Cos.(WMB), Diamond Offshore Drilling Inc.(DO), and Transocean Ltd.(RIG) all fell sharply.

Other markets: European stocks drifted lower while in Asia, stocks finished mixed

The Shanghai Composite Index closing off 0.9% after China's manufacturing Purchasing managers index for July indicated contraction for the first time in five months. Elsewhere, the Nikkei 225 index and other Asian markets rose, benefiting from diminished chances for a U.S. rate increase.

The yen, meanwhile, weakened against the U.S. dollar after disappointing stimulus action from the Bank of Japan last week.

Gold finished modestly higher and silver closed at a two-year high

ES Morning Update August 1st 2016

0

5b1df889-199b-4464-a19e-8fa8c0ebf75c

Finally, after 15 days of range-bound trading the bulls broke out to the upside and have tagged 2177.75 as a pre-market high.  But they rolled over and have dropped back down now to retest the 2170 breakout level.  This is where it gets interesting as the breakout could be label some kind of small wave 1 up with the retest back down a small wave 2... which means they could start some powerful wave 3 up at some point today, but that's only if they hold this 2170 (former resistance, now support) level.

The SPX cash looks like it could help support the ES Futures as it's 60 minute chart appears to be turning back up as well as this chart.  So odds look pretty good for the bulls to turn back up here and make another run higher.  But if they fail to get back over the current pre-market high of 2177.75 before the day ends then they will lose a lot of momentum on this small wave 3 up and risk the whole move being a false breakout as by Tuesday I really doubt if the 60 minute charts will be aligned bullish again on both the SPX Cash and the ES Futures.

My thoughts are that this will indeed be a false breakout.  However, I do still have a FP showing 230 from late last year, which is about 2300 on the SPX... and we all know how the insiders like to use these FP's to tell their buddies where they plan to take the market to, but unfortunately I don't know the "when" part, nor do I know which prints are real versus one's that are just put out to signal a directional move but not a target level.  So basically today if you are a bear you want to see a lower high made then the current 2177.75 high which will then lean bearish for Tuesday.

Bears want to see the 2170 support level break and become resistance again.  It doesn't seem likely to happen today from the looks of the chart as odds will favor the bulls early on and possibly late into the close as well.  Plus you have to think about what SkyNet is trying to do here and to me I think it's trying to lure in more bulls and take out the stops of the last bears (which I sure it did on this move up to 2177.75 this pre-market morning).

The goal here is to convince every last bull and bear that this breakout is real and that we are going to the moon now.  The bulls want a strong wave 3 rally to start as they will likely buy the 2170 back-test and the bears want a fake out rally to linger all day staying below 2177.75 and above the 2170 level.  This allows the short term charts to get overbought again going into Tuesday and will give the bears the best odds of a drop back below 2170 into the 15 day trading range again.  This will be a big defeat for the bulls and their breakout failed to hold and the momentum will have shifted to the bears.  Now the bulls will be on the defense trying to hold the 2150-2155 support zone from breaking.

Which scenario will play out?  I don't know?  But I will point out that other periods in the past that look similar to our current setup all failed.  Granted I'm not going back but several years but it appears that every time there was a period of sideways movement for 7-8 days (or more) there was a drop that followed.  I'm not looking at shorting periods as when under 7-8 days most continued up.  It's like there is a 3-5 days zone where those bull flags work out but after that they all seemed to either fail right away and start a drop or do a quick 1-2 day "false" breakout and then drop.  The thing they have in common is that the MACD's got above 20 on the daily chart, went sideways for at least 7 days, then the MACD's dropped back under 20 and a "false breakout" happen then rolled over or the market just rolled over.  Going back 10 years there wasn't that many times that the MACD's went over 20... and had several days of sideways chop.

But they all had a pullback of some degree.  Some large and so small.  So odds favor this breakout as being false and a pullback to follow.  It doesn't mean that the high was (or will be) put in as some of those times the market went back up after a small pullback to make a higher high and then dropped again for a larger pullback.  It only means a pullback is likely.  So that implies that we drop to 2100-2125 is still very likely if we do have a false breakout and only a small pullback.  Of course if we have a large pullback then look for 2000 or lower to be tested.

Democratic Platform Calls for Carbon Tax – Just Like Matt Taibbi Spoke About Several Years Ago

0

The 2016 Democratic Party platform endorses a carbon tax on the American people. The carbon tax language, added at the last minute, states:

“Democrats believe that carbon dioxide, methane, and other greenhouse gases should be priced to reflect their negative externalities, and to accelerate the transition to a clean economy and help meet out climate goals.”

The move by Democrats to impose a carbon tax comes in clear contrast to the 2016 Republican Party platform opposition to any carbon tax:

“We oppose any carbon tax.”

Grover Norquist, President of Americans for Tax Reform, predicts the Democrat call for a carbon tax will have electoral consequences: “When counting to 270 – the number of electoral votes needed to win the presidency – the Republicans may have already won the election in five short words: ‘We oppose any carbon tax.’ Note the overlap between new fracking states – Pennsylvania, Ohio, and Colorado – and the swing states to reach 270 for any candidate.”


In case everyone forgot Matt Taibbi wrote a great article on the Carbon Tax Scam several years ago.  I wrote about it too (http://reddragonleo.com/2010/04/17/weekend-update-31/).  Here's the full PDF to re-read again...

http://reddragonleo.com/World-Bubbles-GoldmanSachs-Taibbi-Rolling-Stone.pdf

I think you'll find out quickly that Killary is going along with the plans of the gangsters that run the world to screw over the public with another big lie to create another stock market bubble.  While I'm not a big fan of Donald Trump I'd say he's ten times better then Killary Clinton.
hillary-for-prison-2016
Just my opinion of course, but if you are thinking about voting for Hillary you should think twice about that as while Trump might not be an angel he's definitely the "lesser of two evils".
Red

ES Morning Update July 29th 2016

0

74a98125-d7cc-4e90-afa4-04f8b5f66b0b

There's a song out there by Green Day called "Wake me up when September Ends"... which should be changed to July as every day in this market seems exactly like the prior days' market.  Nothing seems to move the market up over resistance or down below support.  It's a never ending repeating day like the movie "Ground Hog Day" with Bill Murray.  So the forecast for today is "Same as it ever was"... until we get a breakout or breakdown we are stuck going nowhere again.  The pattern seems to be down in the morning and back up in the evening, which at some point I'm sure that will end... but I don't know when?

In the news last night we had the Bank of Japan "Disappointing" with their equivalent of our FOMC meeting, and we had North Korea "effectively declaring war" but the market just yawned at all that.  I don't know of anymore news out there that could move the market so it looks like we'll close out this month stuck in this range (assuming no more bigger news shakes us out of it before the close today).  Nothing more to add unfortunately.  Just take and nap and wake up when July is over...

Nikkei whipsaws after BOJ disappointment; yen surges against dollar

0

Japan shares whipsawed and the yen surged after the Bank of Japan threw markets a smaller-than-expected bone in a keenly watched decision on Friday.

While the BOJ eased its monetary policy further by increasing its purchases of exchange-traded funds (ETFs), it didn't change interest rates or increase the monetary base, as analysts had widely expected.

The central bank said it would increase its ETF purchases so that their amount outstanding on its balance sheet would rise at an annual pace of 6 trillion yen ($56.7 billion), from 3.3 trillion yen previously.

"The message the BOJ is sending is not so much much 'whatever it takes' as 'monetary policy's pretty much played out'," said Kit Juckes, global fixed income strategist at Societe Generale.

The Japanese yen surged against the dollar after the announcement, with the dollar-yen pair falling as low as 102.85, compared with around 103.75 immediately before the decision. The pair was already volatile before the announcement, touching a session high of 105.33.
At 2:31 p.m. HK/SIN, the dollar was fetching 103.52 yen.

The benchmark Nikkei 225 whipsawed after the decision, tumbling as much as 1.66 percent immediately after the announcement. It quickly retraced the fall, but then spent the remainder of the session volleying between gains and losses. At market close, the Nikkei finished up 92.43 points, or 0.56 percent, at 16,569.27.

In the bond market, Japanese government bonds (JGBs) sold off. The yield on the benchmark 10-year JGB jumped to negative 0.169, from an earlier low of negative 0.276. Yields move inversely to bond prices. Many analysts had expected the BOJ would increase its JGB purchases.

Sean Darby, chief global equity strategist at Jefferies, said in a note that the news on the ETF purchases "should boost sentiment on stocks," but "overall monetary policy will only be marginally changed given that the BOJ's balance sheet expansion has already decelerated."

"The absence of any change on deposit rates will have disappointed those investors seeking a bolder move by the BOJ," said Darby.

Other Asian markets were nearly flat or mostly lower. The ASX 200 in Australia saw a slight gain of 5.80 points, or 0.1 percent, to 5,562.35. In South Korea, the Kospi closed down 4.91 points, or 0.24 percent, at 2,016.19. Hong Kong's Hang Seng index slipped 327.06 points, or 1.47 percent, to 21,847.28.

Chinese mainland markets were lower, with the Shanghai composite closing down 14.94 points, or 0.5 percent, at 2,979.37, while the Shenzhen composite was off by 9.44 points, or 0.48 percent, at 1,941.55.

In Japan, on the fiscal front, Japanese media agency Jiji reported earlier this week that Prime Minister Shinzo Abe was preparing a stimulus package worth 28 trillion yen ($265.30 billion), which exceeded the top-end of initial estimates of around 20 trillion yen.

That made the BOJ's relatively tame moves even more surprising as analysts had said the fiscal stimulus details may have been leaked to pressure the central bank. Additionally, data showing prices fell was released before the market open, which analysts had expected would also put pressure on the central bank to ease further to try to reach its 2 percent inflation target.

Data from Japan's Bureau of Statistics released before market open showed that nationwide, the consumer price index (CPI) fell 0.4 percent on-year, while the core CPI, which excludes fresh food items, dropped 0.5 percent on-year. The so-called core-core CPI, which excludes food and energy items, gained 0.4 percent on-year.

July price figures for Tokyo, which are available a month in advance of the nationwide data, also fell. Core CPI for Tokyo was down 0.4 percent on-year.

Japan's household spending fell 2.2 percent on-year in June, a relatively steep decline compared with a Reuters poll that had predicted a 0.3 percent drop. The country's seasonally adjusted unemployment rate for June was at 3.1 percent, a 0.1 percent drop from the previous month.

But data from Japan's Ministry of Economy, Trade and Industry (METI) showed industrial production rose 1.9 percent, suggesting an uptick in demand.

Prior to the BOJ announcement, Reuters reported trading in the Japanese government bond futures was halted earlier for 20 minutes due to a likely system glitch. Reuters said the Japan Exchange Group was still looking into potential reasons. Trading was resumed at 0113 GMT, reported Reuters.

Pedestrians holding umbrellas while walking past the Bank of Japan (BOJ) headquarters are reflected in a puddle in Tokyo, Japan. Markets expect the Japanese central bank to introduce further stimulus measures on Friday, July 29, 2016, in a bid to prop up Japan's flagging economy.

Tomohiro Ohsumi | Bloomberg | Getty Images
Pedestrians holding umbrellas while walking past the Bank of Japan (BOJ) headquarters are reflected in a puddle in Tokyo, Japan. Markets expect the Japanese central bank to introduce further stimulus measures on Friday, July 29, 2016, in a bid to prop up Japan's flagging economy.

In company news, shares of Nomura closed up 12.54 percent, after Reuters reported the bank was planning a 45 billion yen buyback of up to 2.6 percent of its shares. In its earnings numbers, Nomura said its April-June net profit dropped to 46.83 billion yen, from 68.7 billion yen a year earlier, said Reuters.

Shares of Singapore's DBS Group fell 2.90 percent following reports that the bank expected to recover about 50 percent of its $519 million exposure to the collapse of a big Singapore oilfield services firm, Swiber.

Reuters said Swiber Holdings became the biggest Singapore business so far to fall victim to the oil price slump in the past year, after the company said on Thursday it had filed for liquidation.

During Asian hours, global benchmark Brent futures traded down 0.47 percent at $42.50, while U.S. crude futures were off by 0.51 percent at $40.93 a barrel.

On the earnings front, Japanese electronics maker Sony released earnings for the three months ended June 30, 2016 after market close. Operating profit dropped 42 percent to 56.2 billion yen ($542.7 million) on-year. Sony said the drop was due to deterioration in the semiconductors segment, which was partially offset by the mobile communications and games & network services businesses.

Sony added it booked a net charges of 13.6 billion yen in expenses in the semiconductors business, resulting from the 2016 Kumamoto Earthquakes.

Sony shares closed up 2.82 percent.

In South Korea, industrial output in June fell 0.2 percent on a seasonally adjusted basis on-month, compared with a Reuters poll that expected an uptick of 0.2 percent. Reuters reported that on an annual basis, industrial output rose 0.8 percent in June, after a revised 4.7 percent gain in May.

U.S. stocks closed mostly higher on Thursday, with the Nasdaq composite closing up 15.17 points, or 0.3 percent, at 5,154.98, its highest level of the year so far, helped by gains in major tech names; Facebook and Amazon closed up more than 1 percent each.
The Dow Jones industrial average closed nearly flat at 18,456.35, while the S&P 500 index closed 3.48 points, or 0.16 percent, higher at 2,170.06.

North Korea: U.S. “crossed the red line,” effectively declared war

0

PYONGYANG, North Korea -- North Korea's top diplomat for U.S. affairs told The Associated Press on Thursday that Washington "crossed the red line" and effectively declared war by putting leader Kim Jong Un on its list of sanctioned individuals, and said a vicious showdown could erupt if the U.S. and South Korea hold annual war games as planned next month.

North Korea joins the Trump bandwagon

Han Song Ryol, director-general of the U.S. affairs department at the North's Foreign Ministry, said in an interview that recent U.S. actions have put the situation on the Korean Peninsula on a war footing.

The United States and South Korea regularly conduct joint military exercises south of the Demilitarized Zone, and Pyongyang typically responds to them with tough talk and threats of retaliation.

Han said North Korea believes the nature of the maneuvers has become openly aggressive because they reportedly now include training designed to prepare troops for the invasion of the North's capital and "decapitation strikes" aimed at killing its top leadership.

Donald Trump says he's willing to meet with Kim Jong Un

Han says designating Kim himself for sanctions was the final straw.

"The Obama administration went so far to have the impudence to challenge the supreme dignity of the DPRK in order to get rid of its unfavorable position during the political and military showdown with the DPRK," Han said, using the acronym for North Korea's official name, the Democratic People's Republic of Korea.

"The United States has crossed the red line in our showdown," he said. "We regard this thrice-cursed crime as a declaration of war."

Soldiers shout slogans as they march past a stand with North Korean leader Kim Jong Un and other officials during the parade celebrating the 70th anniversary of the founding of the ruling Workers' Party of Korea, in Pyongyang Oct. 10, 2015.

Soldiers shout slogans as they march past a stand with North Korean leader Kim Jong Un and other officials during the parade celebrating the 70th anniversary of the founding of the ruling Workers' Party of Korea, in Pyongyang Oct. 10, 2015.

Soldiers shout slogans as they march past a stand with North Korean leader Kim Jong Un and other officials during the parade celebrating the 70th anniversary of the founding of the ruling Workers' Party of Korea, in Pyongyang Oct. 10, 2015.

Soldiers shout slogans as they march past a stand with North Korean leader Kim Jong Un and other officials during the parade celebrating the 70th anniversary of the founding of the ruling Workers' Party of Korea, in Pyongyang Oct. 10, 2015. REUTERS/DAMIR SAGOLJ

Although North Korea had already been heavily sanctioned internationally for its nuclear weapons and long-range missile development programs, Washington's announcement on July 6 was the first time Kim Jong Un has been personally sanctioned.

North Korea tries to show its military might

Less than a week later, Pyongyang cut off its final official means of communications with Washington - known as the New York channel. Han said Pyongyang has made it clear that everything between the two must now be dealt with under "war law."

Katina Adams, State Department spokeswoman for East Asia and the Pacific, said the U.S. continues to call on North Korea "to refrain from actions and rhetoric that further destabilize the region and focus instead on taking concrete steps toward fulfilling its commitments and international obligations."

She said the U.S.-South Korea joint military exercises are "defense-orientated" and have been carried out regularly and openly for roughly 40 years, and are designed to maintain stability on the Korean Peninsula. "These exercises are a clear demonstration of the U.S. commitment to the alliance," she said.

South Korea's unification, defense and foreign ministries did not immediately comment.

Kim and 10 others were put on the list of sanctioned individuals in connection with alleged human rights abuses, documented by the United Nations Human Rights Commission, that include a network of political prisons and harsh treatment of any kind of political dissent in the authoritarian state. U.S. State Department officials said the sanctions were intended in part to highlight those responsible for the abuses and to pressure lower-ranking officials to think twice before carrying them out.

Pyongyang denies abuse claims and says the U.N. report was based on fabrications gleaned from disgruntled defectors. Pointing to such things as police shootings of black Americans and poverty in even the richest democracies, it says the West has no moral high ground from which to criticize the North's domestic political situation. It also says U.S. allies with questionable human-rights records receive less criticism.

Han took strong issue with the claim that it was not the U.S. but Pyongyang's continued development of nuclear weapons and missiles that is provoking tensions.

"Day by day, the U.S. military blackmail against the DPRK and the isolation and pressure is becoming more open," Han said. "It is not us, it is the United States that first developed nuclear weapons, who first deployed them and who first used them against humankind. And on the issue of missiles and rockets, which are to deliver nuclear warheads and conventional weapons warheads, it is none other than the United States who first developed it and who first used it."

He noted that U.S.-South Korea military exercises conducted this spring were unprecedented in scale, and that the U.S. has deployed the USS Mississippi and USS Ohio nuclear-powered submarines to South Korean ports, deployed the B-52 strategic bomber around South Korea and is planning to set up the world's most advanced missile defense system, known by its acronym THAAD, in the South, a move that has also angered China.

Echoing earlier state-media reports, Han ridiculed Mark Lippert, the U.S. ambassador to South Korea, for a flight on a U.S. Air Force F-16 based in South Korea that he said was an action "unfit for a diplomat."

"We regard that as the act of a villain, who is a crazy person," Han said of the July 12 flight. "All these facts show that the United States is intentionally aggravating the tensions in the Korean Peninsula."

Han warned that Pyongyang is viewing next month's planned U.S.-South Korea exercises in this new context and will respond if they are carried out as planned.

"Nobody can predict what kind of influence this kind of vicious confrontation between the DPRK and the United States will have upon the situation on the Korean Peninsula," he said. "By doing these kinds of vicious and hostile acts toward the DPRK, the U.S. has already declared war against the DPRK. So it is our self-defensive right and justifiable action to respond in a very hard way.

"We are all prepared for war, and we are all prepared for peace," he said. "If the United States forces those kinds of large-scale exercises in August, then the situation caused by that will be the responsibility of the United States."

Last year's Ulchi Freedom Guardian exercises involved 30,000 American and 50,000 South Korean troops and followed a period of heightened animosity between the rival Koreas sparked by land mine explosions that maimed two South Korean soldiers. In the end, the exercises escalated tensions and rhetoric, but concluded with no major incidents.

Han dismissed calls for Pyongyang to defuse tensions by agreeing to abandon its nuclear program.

"In the view of cause and effect, it is the U.S. that provided the cause of our possession of nuclear forces," he said. "We never hide the fact, and we are very proud of the fact, that we have very strong nuclear deterrent forces not only to cope with the United States' nuclear blackmail but also to neutralize the nuclear blackmail of the United States."

Why Friday May Be One of the Most Interesting Days of the Quarter

0

The world's biggest economies will all be in the spotlight.

A day that's expected to affirm the U.S. consumer's strength could also begin with a step into uncharted unconventional policy by the nation whose demographic trends may serve as an early warning signal of what awaits other advanced economies.

"Tomorrow could be among the most challenging sessions of the third quarter," writes Marc Chandler, head of currency strategy at Brown Brothers Harriman & Co. "The focus is primarily on Japan and Europe, but the U.S. reports its first estimate of second-quarter GDP."

Investors will have a lot on their plates to digest, with a Bank of Japan meeting, the results of stress tests on European banks, as well as new growth figures for the euro area and North America all scheduled to be released.

Analysts at HSBC Holdings Plc in a report on Thursday, citing "high" expectations for the Bank of Japan meeting, see three scenarios: disappointment (causing a sharp weakening in the yen relative to the U.S. dollar in the short-term), greater monetary stimulus (a strong yen in the short-term) and helicopter money.

The analysts write: "For the first two scenarios we would expect the medium term impact on USDJPY to be limited, although the short-term reaction would likely be different". Only helicopter money — a permanent addition to the monetary base — would deliver a weaker yen in the medium-term, they say.

"We still expect the BOJ to cut rates and increase the pace of asset buying modestly," Societe Generale SA analysts write, adding that markets would be "disappointed" if Japan's central bank withheld its monetary firepower.

Brunello Rosa, analyst at Roubini Global Economics, foresees a 10 basis point cut in the deposit rate to minus 20bps, accompanied by asset purchases and policies to ease the pressure on banks grappling with low net interest margins. Rosa writes: "In our view, increases in asset purchases at this stage would likely be limited to risky assets (mainly exchange-traded funds), with increased Japanese government bond purchases an upside risk to accompany the recently announced 28 trillion yen fiscal stimulus boost."

Capping off a big week for the global economy — following the Federal Reserve and BOJ meeting — the European Banking Authority will announce the results of its stress tests on Friday evening, 9pm London time, which is expected to shed light on non-performing loans at Italian lenders.

Separately, annual headline inflation in the euro zone for June is expected to tick into positive territory for the first time since January, notes Brown Brothers Harriman & Co.'s Chandler, and the first estimate of second-quarter GDP growth for the euro area is also due out. The rate of expansion is expected to moderate to 0.3 percent quarter-over-quarter from 0.6 percent in the first three months of the year.

The U.S. consumer is poised to post its best rate of growth in over a decade, but data released on Wednesday give cause to temper expectations on how much headline growth will accelerate.

Following the release of the Census Bureau's advance economic indicators report, the Atlanta Fed GDP Now forecast for second-quarter growth tumbled by half a percentage point to 1.8 percent. The consensus estimate among economists surveyed by Bloomberg is for annualized quarter-over-quarter growth of 2.6 percent.

While the initial print has been subject to heavy revisions, it's the release that tends to move markets the most.

Meanwhile, America's neighbor to the north is slated to report GDP growth for the month of May, with analysts expecting Canada's economy to show a monthly contraction of 0.5 percent as wildfires began to wreak havoc in oil-producing regions of Alberta.

ES Morning Update July 28th 2016

0

4464177d-9828-4191-ae3b-9f40d92b08d6

Well, the FOMC was a dud as Janet Yellen said nothing important and the market failed to breakout to the upside or breakdown.  So here we are again, still stuck in a trading range that we've been in since about July 14th... now what?  I mean, what kind of news is left out there that can break this market out in one direction or the other?  Will it be earnings from Facebook or Google... or some other company?  Apple didn't move the market much yesterday even those it popped up higher after its' earnings report.  With Facebook and Google also doing well after the close yesterday they are up some too... but still no breakout on the futures.  That's 3 stocks with good reports that are heavy weights in the market who all failed to break the indexes out.  So tell me, what is there left in the bulls corner that get through overhead resistance?  I don't know of anything left that can help them, so let's look at the bears now.

The bears seem to be asleep now as the light volume rules the market every day in these summer months.  They don't seem have any reasons (news events or data) that can get them to wake up and kick the bulls down through the 2150-2155 support zone on the ES Futures.  So it's really just going to be based on the technical analysis of the market as there's no big news left to cause a breakout or breakdown.  Unfortunately the TA's tell me that it's a mixed picture right now.  The bulls have worked off a lot of the overbought charts over the last 14 days of sideways chop.  But there are up at extremes on bullishness with the VIX buried down too low to spark a strong bull rally.  It really is stuck in this range and might stay here even longer from what the mixed charts tell me.  Meaning I don't see any clear direction from them.  I would hate to be trapped here for another 2 weeks as this is hell for both bulls and bears alike.

My feeling are that we'll start a pullback inton next week as the daily and weekly charts seem too extended to continue up without a pullback so the VIX can come up from off the floor to be pushed back down again when the market finds its' pullback level in the 2100 zone and turns back up again to make another attempt at busting through that 2170 resistance zone.  The last week or two of August is usually bearish so that might stop the bulls on the move back up from this first pullback... which they know of course, and could lead to them holding on to this trading zone for another 2 weeks.  Yeah, the bulls are pigs and will eat until they collapse instead of taking a rest and coming back later all fresh with bear stops to eat from some squeeze starting at the 2100 pullback zone.  All that babbling aside, there's nothing to do but wait for a breakdown or breakout.

Fed Says Risks Have Diminished as It Leaves Rate Unchanged

0

The Federal Reserve left interest rates unchanged while saying risks to the U.S. economy have subsided and the labor market is getting tighter, suggesting conditions are getting more favorable for an increase in borrowing costs.

“Near-term risks to the economic outlook have diminished,” the Federal Open Market Committee said in its statement Wednesday after a two-day meeting in Washington, before repeating language from June that the panel “continues to closely monitor” inflation and global developments. Job gains were “strong” in June and indicators “point to some increase in labor utilization in recent months,” the Fed said.

U.S. central bankers are taking stock of the economy’s progress in the wake of the U.K.’s vote last month to leave the European Union, as well as the large swing from May’s soft labor report to June’s rebound. While Chair Janet Yellen has repeatedly stated that the Fed is likely to raise interest rates gradually, market volatility and the unexpected dip in job gains have delayed such plans.

"It’s kind of an upbeat statement, although guarded," said Roberto Perli, partner at Cornerstone Macro LLC in Washington and former associate director for monetary affairs at the Fed Board. “It’s a sign of a little bit of confidence, if you want, in the outlook going forward."

The committee repeated that it expects “economic conditions will evolve in a manner that will warrant only gradual increases in the federal funds rate.” There was no reference to the specific timing of the next potential rate hike.
Labor Market

Data since the Fed’s June meeting indicate “that the labor market strengthened and that economic activity has been expanding at a moderate rate,” the Fed said. The statement contained three references to recent improvement in the labor market.

The central bank left the target range for the benchmark federal funds rate at 0.25 percent to 0.5 percent, where it’s been since a quarter-point increase in December that ended seven years of near-zero rates.

Household spending “has been growing strongly,” while business investment “has been soft,” the FOMC said. The Fed reiterated that it expects inflation to rise to its 2 percent target over the medium term.
Yellen’s Stewardship

Yellen is defining her term at the central bank with a cautious policy aimed at steering the economy through domestic headwinds such as tight credit and low productivity gains as well as global shocks. The unexpectedly long pause in interest-rate increases has suggested she’s waiting for overwhelming evidence of a strong economy and for international risks to subside.

“You have to view September as a very real possibility for a rate hike, but it’s not our base case,” said Luke Tilley, chief economist at asset manager Wilmington Trust Corp. “If the data comes in fairly strongly ahead of September, they’ve positioned themselves to do something.”

The statement contrasted June’s jobs report with “weak growth in May.” Non-farm payrolls rose by 287,000 jobs in June, dispelling some concern that hiring had slowed, after May’s gain of 11,000. Recent reports on retail sales, housing starts, capacity utilization, and service industries have all beat economists’ expectations.

Yellen wasn’t scheduled to hold a press conference after this week’s meeting. Fed officials next meet Sept. 20-21, and will publish new forecasts and rate projections at the conclusion of that gathering.
George Dissents

Esther George, president of the Kansas City Fed, dissented, reinstating her preference for a quarter-point increase after supporting the decision in June to leave rates unchanged.

All but two of 94 analysts surveyed by Bloomberg News expected the Fed to leave interest rates unchanged at the meeting. Federal funds futures ahead of Wednesday’s statement suggested that traders see close to a 50-50 chance of a rate hike at or before the FOMC’s final meeting this year, in December.

Yellen will speak at the Kansas City Fed’s Jackson Hole, Wyoming, symposium on Aug. 26. That will provide her with an opportunity to discuss the committee’s sense of the economy’s progress.

"The market is going to pay a lot of attention to that speech,” Perli said.

US|US Expands Program to Track Secret Buyers of Luxury Real Estate

0

Multimillion-dollar mansions are spreading in Los Angeles and their international owners are hidden by shell companies

Convinced that money laundering in high-end real estate is a significant problem, the Treasury Department said Wednesday that it would expand a program it put in place earlier this year to identify and track people who purchase real estate in cash, using shell companies.

The expansion means that there will be increased scrutiny of luxury real estate purchases made in cash by buyers in all five boroughs of New York City, counties north of Miami, Los Angeles County, San Diego County, the three counties around San Francisco and the county that includes San Antonio.

The program is part of a broad effort by the federal government to crack down on money laundering and secretive shell companies. The Treasury Department started the examination — known as a geographic targeting order — in March in Manhattan and Miami-Dade County, and officials said the results so far from those cities had persuaded the department to expand across the country.

Specifically, more than 25 percent of the buyers paying in cash and using shell companies have been people who have also been involved in suspicious activity reports, which banks file to the Treasury, Treasury officials said in a call with reporters.

“The information we have obtained from our initial G.T.O.s suggests that we are on the right track,” Jamal El-Hindi, the acting director of the Financial Crimes Enforcement Network within the Treasury, said in a department news release. “By expanding the G.T.O.s to other major cities, we will learn even more about the money laundering risks in the national real estate markets, helping us determine our future regulatory course.”

Among the suspicious transactions that the Treasury Department found tied to sales in New York or Miami this year were a $16 million cash withdrawal, a person involved in counterfeit checks and someone involved in moving $7 million around in shell companies associated with South America, Treasury officials said.

The areas being added to the order are places where buyers frequently purchase luxury real estate using shell companies, the officials said. The dollar values involved purchases of more than $500,000 or more in Bexar County, which includes San Antonio; $1 million in Florida; $2 million in California; $3 million in Manhattan; and $1.5 million in the other boroughs of New York City.

Treasury officials have said that their real estate tracking program was inspired in part by a series last year in The New York Times that examined the rising use of shell companies. The investigation found that real estate professionals, especially in the luxury market, often do not know much about buyers, and it uncovered numerous buyers of high-end real estate who had been subject to government investigations around the world.

One installment of The Times’s investigation documented properties purchased in shell companies by friends and family of the prime minister of Malaysia. Those properties were subject to the largest asset forfeiture order ever in a kleptocracy case, which was announced this month.

Treasury officials said they were already seeing benefits to the program in Manhattan and Miami, citing an increase in suspicious-activity reports being filed by banks, and noting that the Department of Justice is finding the combination of the real estate and banking information to be helpful in its investigations.

Officials said the data collected in these six markets would be used to evaluate a permanent rule in the future.

Facebook crushes Q2 earnings, hits 1.71B users and record share price

0

Coming off an all-time high stock price of $123.34, Facebook in Q2 2016 smashed earnings again. The social network continued steady growth just slightly slower at 3.63% compared to last quarter’s 3.77%, adding 60 million monthly users this quarter to reach 1.71 billion. It scored $6.44 billion in revenue and $0.97 EPS, blowing past estimates of $6.02 billion and $0.82 EPS.

This is Facebook’s 16th beat out of 17 quarters since it went public at $38 per share. Wall Street reacted to the positive earnings with a 7.5% bump in after hours trading to $132.60. It also hit another milestone: 1 billion daily mobile user.

Revenue growth was 59% year over year, which looks favorable compared to competitor Twitter, who yesterday announced its YOY revenue growth sunk to 20% from 60% a year ago. With 84% of ad revenue from mobile, total ad revenue was $6.24 billion.

Facebook DAU Q2 2016

Though the big monthly user count gets the spotlight, Facebook’s daily active user count is a better measure of its health. Total DAUs reached 1.13 billion up 17% for the year, with 1.57 billion mobile MAUs up 20%. What’s especially remarkable is that Facebook’s stickiness, or DAUs divided by MAUs, stayed steady at 66%. That means people aren’t using Facebook less even as it grows and ages.

Facebook’s efficient social network operation raked in $2.05 billion in profit, compared to $719 million a year ago, while average revenue per user is now $3.82, up a big 15% from last quarter. As we detailed last quarter, Facebook has found a way to squeeze more cash out of the developing world, where ARPU grew a sharp 24% to $1.13. 

And after years of success, Facebook has stockpiled $23 billion in cash on hand in case it wants to make any other big acquisitions.

Facebook Mobile DAUs Q2 2016

Facebook hit with bad press while product keeps winning

Facebook’s Q2 was marred by several bouts of negative press. Allegations from anonymous sources suggested it was purposefully suppressing conservative news Trends. Facebook denied the allegations and its internal investigation found no proof, but it vowed to better train Trend curators to avoid bias.

Later, on the behalf of its users, it changed the News Feed algorithm to prioritize posts from friends and family over stories from news publishers and brands. It’s still too early to draw conclusions on the size of the drop in reach and referral traffic for publishers, though Facebook admitted it’d be significant.

Facebook Messenger Growth Graph

Facebook Live continued its growth, pulling some attention from Twitter’s acquisition Periscope that beat it to market last year. Live got new creative expression features and an API to help broadcasters use professional equipment. Meanwhile, video on Facebook continued its ascension, becoming a legitimate YouTube competitor. Mark Zuckerberg wrote in his letter to shareholders that “We’re particularly pleased with our progress in video as we move towards a world where video is at the heart of all our services.”

Facebook’s secondary products enjoyed big milestones. Facebook Messenger hit 1 billion active users, thanks to constant product iteration like the new addition of an end-to-end encryption option, though also the fact that Facebook removed chat from its main app and forced users to download Messenger.

Meanwhile, Instagram reached 500 million users. Its community bristled at the announcement that an algorithmic feed would start highlighting the most popular posts instead of showing a purely reverse chronological stream. But that backlash hasn’t seemed to hurt Instagram too bad.

Facebook ARPU Q2 2016

Overall, it looks like Facebook keeps winning despite its massive size and old age for a social product. It’s got a diversified set of products thanks to acquisitions, and plenty of cash to buy more. The company has figured out how to squeeze more cash out of each user while still adding tons per quarter thanks to emerging markets and its internet access initiatives.

While Snapchat might be pulling away daily life-casting, and Twitter is combining the first and second screens with its livestream deals, Facebook remains the core social network and messaging product of the world.

 

Beaten-down Apple stock has best day in 2 years

0

Apple doesn't have to do much to wow Wall Street these days.

The iPhone maker provided another sober reminder of how its days of hyper growth are long gone. Apple (AAPL, Tech30) posted its second-straight quarter of shrinking sales, led by another drop in smartphone shipments.

But the bar has been set so low for Apple that the numbers, along with a less dreary forecast for the next few months, were enough to excite Wall Street. Apple stock spiked over 7% on Wednesday, on track for its best day since April 2014. If it surges 9% or more by the end of day, it'd be the biggest advance since at least 2008.

The hugely positive reaction shows how much things have changed for Apple. Just a few years ago, the iconic tech company was held to such high standards that even beating expectations would cause the stock to retreat.

Now, Apple can post a 25% slump in profits, a 16% decline in iPhone sales and further erosion to its margins and it's deemed not as bad as feared.apple stock down

Inside Apple's second quarter of shrinking sales

The lowered-bar for Apple makes sense though. Apple shares slumped 4% last year and, despite Wednesday's big rally, remain down 1% in 2016. Tech stars of today like Facebook (FB, Tech30) and Amazon (AMZN, Tech30) are up sharply the past two years and trading at all-time highs.

Apple's numbers do give shareholders some reason to hope that the worst is over. The iPhone maker expects to generate $45.5 billion to $47.5 billion in revenue next quarter, exceeding what analysts had been calling for.

"We expect slow growth to return and be sustained barring a serious recession," Raymond James analyst Tavis McCourt wrote in a research report.

Even though McCourt still sees "many weak points," he expects "almost all of the concerns to get incrementally better" in 2017. That's why the analyst upgraded his rating on Apple to "outperform" and slapped a $129 price target on the stock. Apple shares would have to soar 24% above current levels to hit that mark.

Beyond the latest numbers, investors love how much of a cash cow Apple has turned into. The company used to hoard its vast sums of cash, but now it's spreading the wealth in the form of fat dividends and share buybacks. Apple returned $13 billion to shareholders last quarter alone and it's completed the vast majority of a $250 billion capital return program.

Apple also had the benefit of reporting results at a time when the markets are in a pretty good mood. U.S. stocks have climbed to record highs in recent weeks and CNNMoney's Fear and Greed Index is currently flashing "extreme greed."

The Apple effect of a few years ago was in full effect on Wednesday. Apple was not only the biggest winner on the Dow, but iPhone suppliers also enjoyed a bounce. Shares of Qorvo (QRVO) and Cirrus Logic (CRUS)rallied more than 4% apiece, while Skyworks Solutions (SWKS) and Broadcom (AVGO) also made headway.

s2Member®