Headline News Archives

Tuesday 07.26.2016

CEO: Supporting Trump over Clinton is a no-brainer

As the CEO of a 114-year-old manufacturing company, supporting Donald Trump over Hillary Clinton for president is a no-brainer — as it should be for any business owner or job creator.

Charlotte Pipe and Foundry Company is one of the country's largest producers of cast iron and plastic pipe and fittings. We are a fifth generation family-owned and operated manufacturer headquartered in Charlotte, NC, with seven plant locations across the United States. We are in an energy-intensive, trade-sensitive sector of our economy and, despite the worst recession in 2008 since the Great Depression, we have not had a layoff in more than three decades at our Plastics Division and since 1957 in our Foundry Division.

The primary task of the management team at Charlotte Pipe is to keep our people working in safe, high-paying, middle class jobs — a task that is becoming harder and harder to do because of our federal government. Over the last seven years, we have seen unprecedented government intrusion in the private sector — from banking to autos, health care, energy and the internet. We have become alarmed that the Obama administration has brazenly disregarded co-equal branches of government and the constitutional limits on executive power to enact their ideological agenda.

Politicized government agencies have engaged in significant regulatory overreach and antagonistic enforcement. The Obama administration has imposed an astronomical 20,642 new regulations since Obama took office in 2009, according to a report from the Heritage Foundation, a conservative research think tank. And, federal regulations cost the U.S. $1.9 trillion in 2015, according to a separate report from the Competitive Enterprise Institute, a free-market think tank.

Bank executives descend on Philly to celebrate Hillary Clinton

Hordes of industry executives will descend on the city to celebrate Hillary Clinton’s nomination for president and renew close associations that vexed the Democratic standard-bearer throughout her primary battle with Bernie Sanders.

Goldman Sachs, which paid Clinton millions for private speeches, will be well represented in Philadelphia with executives Jake Siewert, a former Bill Clinton press secretary, making the trip along with Steven Barg, Michael Paese, Joyce Brayboy and Jennifer Scully, who was a major fundraiser for Bill Clinton in New York in 1992.

Blackstone, one of the nation’s largest private equity firms, will hold an official reception in Philadelphia on Thursday featuring its president, Tony James, sometimes mentioned as a possible Treasury Secretary in a Clinton administration.

Hedge fund managers and top Democratic donors including Avenue Capital’s Marc Lasry and Boston Provident’s Orin Kramer will also be on the scene as will Morgan Stanley executive and former top Clinton aide Tom Nides. Executives from Citigroup, JPMorganChase and other large banks will also prowl the streets and bar rooms of Philadelphia.

John Kerry: Air conditioners as big a threat as ISIS

Secretary of State John Kerry said in Vienna on Friday that air conditioners and refrigerators are as big of a threat to life as the threat of terrorism posed by groups like the Islamic State.

The Washington Examiner reported that Kerry was in Vienna to amend the 1987 Montreal Protocol that would phase out hydrofluorocarbons, or HFCs, from basic household and commercial appliances like air conditioners, refrigerators, and inhalers.

“As we were working together on the challenge of [ISIS] and terrorism,” Kerry said. “It’s hard for some people to grasp it, but what we–you–are doing here right now is of equal importance because it has the ability to literally save life on the planet itself.”

Kerry said that most of the substances banned in the Montreal Protocol have increased the use of HFCs and claimed that the coolant was thousands of times more potent than CO2. He added that the increase of HFCs has led to the trend of global climate change.

Yahoo-Verizon; Big CEO pay often means big underperformance

Credit Card Companies Specifically Target Less Educated And Less Sophisticated Americans

The big credit card companies don’t make much money off of those that pay their bills on time, and so they often specifically target less educated and less sophisticated consumers that don’t really understand the dangers of credit card debt. The goal is to find people that will carry credit card balances from month to month, because that is where the real money can be made. The average U.S. household that carries balances from month to month has approximately $15,310 in credit card debt right now. At an average interest rate of about 15 percent, the profits pile up very quickly for the big credit card companies. After all these years, so many of us still have not learned the truth about credit cards, and so credit card debt is absolutely crippling tens of millions of American families.

In 2015, the total amount of credit card debt in this country increased by a staggering 71 billion dollars. In a previous article, I explained to my readers that American consumers accumulated more new credit card debt during the fourth quarter of 2015 than they did during the entire years of 2009, 2010 and 2011 combined.

Many analysts are forecasting that the total amount of credit card debt will surpass a trillion dollars by the end of 2016. This is why there is such a crying need for financial education in this nation. Millions upon millions of us are being taken for a ride, and as I mentioned above, the big credit card companies often target those of us that are the least sophisticated about financial matters. The following comes from Bloomberg…

Credit-card companies need people to spend more than they can afford, but not so much that they default on their payments. So they could benefit from targeting individuals who are more likely to have cognitive failings. This is the dark side of behavioral finance.

Why Summer Jobs Don't Pay Off Anymore

Why can't kids today just work their way through college the way earlier generations did? The answer to that question isn't psychology. It's math. A summer job just doesn't have the purchasing power it used to, especially when you compare it with the cost of college.

Let's take the example of a working-class student at a four-year public university who's getting no help from Mom and Dad. In 1981-'82, the average full cost to attend was $2,870. That's for tuition, fees and room and board.

The maximum Pell Grant award back then for free tuition help from the government was $1,800. That leaves our hypothetical student on the hook for just about $1,000. Add in a little pocket money, too — say $35 a week. That makes an extra $1,820 for the year on top of the $1,000 tuition shortfall.

Now, $3.35 an hour was the minimum wage back then. So, making $2,820 meant working 842 hours. That's 16 hours a week year-round — a decent part-time job. It's also about nine hours a day for three straight months — a full-time, seven-day-a-week summer job. Or, more likely, a combination of both. In short: not impossible. Far from it. For today's public university student, though, the numbers have all changed in the wrong direction.

Kmart Employees Report Sudden Merchandise Purges, General Sense Of Doom

Kmart isn’t closing all of its stores. Nope. That’s the company’s official policy, and what they tell anyone who asks. Yes, they’re closing some stores, both gradually and in big batches, but that’s part of the company’s “transformation from a traditional, store-network based retail business model to a more asset-light, member-centric integrated retailer.” Yet some employees are quietly worried that the whole chain is about to shut down.

The most frightening thing that employees reported to Business Insider is that stores have been mysteriously designated “Phase 1” and “Phase 2.” Those phases totally do not have anything to do with whether the stores are closing, management tells them: they’re phases in a “path to profitability” that isn’t working yet.

Employees’ private discussions between stores show that one of these “phases” includes purging the warehouse and putting all stock out on the sales floor, a sort of silent liquidation sale. If there isn’t room on the shelves, they’re to put up extra temporary shelves, as long as everything is out there.

A Sears Holdings spokesman told Business Insider that this is not the case, and the warehouse purges are part of an effort to keep employees out in the store among customers, and to “improve inventory management.”

Di Caprio’s hypocrisy: Eco-activist jets to France to fundraise for climate change

Credit Collapse Cometh

Let us review the insanity that is our banking system: a saver deposits $100 into a fractional reserve bank. The bank opens a demand account for the depositor, which means it must pay him back immediately whenever he so demands. Assuming the law requires a 10 percent reserve, as is common, the bank can lend $90 of the deposit to someone else, for example, the buyer of a house. The home buyer agrees to repay the loan over ten or even thirty years, notwithstanding that the depositor’s loan to the bank is payable on demand! This alchemy is called “maturity transformation”: the depositor’s current funds come to finance a bid on long-term, illiquid assets. A better word would be “fraud.” If any person tried this trick beyond the safety of a bank charter, he would go straight to prison.

Maturity transformation is only the beginning of the story—the home buyer borrowing $90 from the bank for thirty years (financed by the depositor’s $100 demand money) pays it to the seller, who then deposits it back at a bank as current funds. This bank, whether it is the same or different, treats this deposit the same way the original deposit was treated: it lends out 90 percent of it at term, adding an additional $81 of term debt and another $81 of demand deposits. The process repeats—$72.90 of debt is created, then $65.61, then $59.05, ad infinitum—until there is $1000 of debt financed by the $100 deposit. In this way, when a bank receives a deposit of $100, the banking system doesn’t lend out half, or even 90 percent of it—it lends out ten times the amount! The $900 surplus is conjured out of thin air, ex nihilo. If reserve requirements decline to 5 percent, then the banking system can lend out $2,000 of term loans from a $100 demand deposit.

Reread the last sentence. The brain almost forces a reconsideration of the process. Try explaining the paragraph above to the branch manager at your local bank and you will receive a blank stare or perhaps hostility.1 No one can dispute John Kenneth Galbraith’s assessment: “The process by which banks create money is so simple that the mind is repelled.”

Keynesians and monetarists (who differ from Keynesians only in that they prefer their central planning to be done by central bankers instead of by Congressmen) see no danger with the fractional reserve process. So what if $100 is transformed into $2000, as long as that $2000 figure remain constant. If prices start rising, the central planners can raise reserve requirements to squelch the process and reduce the amount of money. If pesky depositors ask for their money back, threatening to unwind the entire credit structure, then the central bank can print up more of the stuff (unlike under the gold standard, under which banks had no choice but to call in loans to meet depositors’ demands).

Clinton's Image at Lowest Point in Two Decades

As the Democratic National Convention gets underway in Philadelphia, Hillary Clinton's image is at its lowest point in the 24 years of her national career, with 38% of Americans viewing her favorably and 57% unfavorably. Americans' most positive view of Clinton, 67% favorable, came in December 1998. Before last year, her lowest favorable ratings since she became well-known had been 43% in January 1996 and 44% in March 2001.

Gallup first measured Hillary Clinton's image in 1992 as her husband campaigned for the Democratic presidential nomination. Her image, like Bill Clinton's, was mixed in the spring of that year but then grew more positive. Her favorable ratings were above 60% at several points in 1993, and more than six in 10 Americans viewed her favorably at other points as well: when her husband was impeached by the House and tried by the Senate in 1998 and 1999, from 2009 through 2013 while she served as secretary of state, and in April 2013 after she returned to being a private citizen.

After launching her campaign last year and as her handling of emails while secretary of state became an increasingly public and controversial issue, Americans' views of Clinton began their downslide.

Americans' history of changing their views of Clinton from positive to negative and back to positive since 1992 suggests it's possible -- although not highly likely, given recent trends -- that her image could improve as the Democratic convention unfolds this week. Overall, 55% of Americans viewed her favorably and 39% unfavorably from 1992 through 2014. That long-term average is almost an exact flip of her current 38% favorable, 57% unfavorable rating. This shows how much more negatively the public views her now in the midst of her campaign and email controversy than they have historically.

Is China About to Shock the Market?

Did the U.S. just double-cross China under the Shanghai Accord? If so, China will act on its own to devalue the Chinese yuan. In that case, the Dow Jones Industrial Average could plunge to 16,450, and the S&P 500 could plunge to 1,925 in a matter of weeks, wiping out trillions of dollars of investor wealth.

This is not guesswork. Plunges of over 10% in U.S. stock indices happened twice in the past year. Both times it was because of a combination of a stronger dollar and weaker yuan. It’s happening again. And you need to understand the dynamics both to avoid losses and reap big gains by positioning ahead of the meltdown.

China is struggling under the weight of too much debt, poor demographics, and competition from lower priced suppliers in Vietnam, Indonesia, and the Philippines. China needs economic relief. Fiscal stimulus just means more non-sustainable debt. China has too much of that already. The easiest way to give the Chinese economy a boost is to cheapen its currency, the yuan (CNY), to make its exports more competitive.

When China cheapens CNY, they encourage capital flight. The wealthy and well connected try to get their money out of China as quickly as possible before the next devaluation. This causes the dumping of Chinese stocks, which soon infects U.S. stock markets and causes a global liquidity crisis. The last two times China devalued, U.S. stocks fell over 10%. The Shanghai Accord, agreed in Shanghai, China on February 26, 2016 was an effort to give China some relief without having to devalue CNY against the U.S. dollar (USD). The solution was to keep CNY pegged to USD, but weaken USD against the euro and the yen.

Record Swiss Gold Flow Into The United States

There was a huge trend change in U.S. gold investment in May. Something quite extraordinary took place which hasn’t happened for several decades. While Switzerland has been a major source of U.S. gold exports for many years, the tables turned in May as the Swiss exported a record amount of gold to the United States.

How much gold? A lot. The Swiss exported 50 times more gold in May than their monthly average (0.4 mt) since 2015:

As we can see, the Swiss gold exports to the United States are normally less than 0.5 metric ton a month. And for many months there weren’t any gold exports. However, something big changed in May as Swiss gold exports surged to 20.7 mt (665.500 oz).

The overwhelming majority of gold flows from the U.S. have been exports to Switzerland and the United Kingdom.

1,819 illegal immigration cases per judge, backlog at all-time high 500,000

The backlog of pending cases in U.S. immigration courts has hit an all-time high of nearly 500,000, crushing the small corps of just 273 Justice immigration lawyers.

Syracuse University's Transactional Records Access Clearinghouse just revealed that the backlog has hit 496,704 at the end of June 2016. That is up from 456,216 just nine months ago, and up from 408,037 two years ago.

The number has surged even as the administration has added a handful more judges. The current ratio is 1,819 cases per judge. Democrats here for their national nominating convention are expected to call for more immigration and back amnesty for illegals aready in the country.

What's new in the latest figures is the growth of priority cases involving illegal unaccompanied children who have crossed the border in the last two years. The administration has told the courts to take care of those cases first. But the sheer numbers have forced a huge delay. It currently takes nearly two years — 672 days — for a case to get to court. During that time, the illegals are allowed into the country and several reports show that they rarely make their court date.

7-Eleven’s 1st Drone Delivery

Americans Plan to Spend Billions More on Back-to-School Shopping This Year

Americans are expected to spend $75.8 billion on back-to-school supplies this year — $7.8 billion more than last year, according to the National Retail Federation’s (NRF) annual survey, conducted by Prosper Insights and Analytics.

“Families are still looking for bargains, but there are signs that they are less worried about the economy than in the past,” NRF president and CEO Matthew Shay said in a press release Opens a New Window. .

The NRF surveyed more than 6,800 consumers about their back-to-school and -college plans, finding that families with children in grades K-12 are expected to spend Opens a New Window. 9.6% more this year than last year. That comes out to an average of $673.57 per family for accessories, electronics, shoes and school supplies.

The survey has a margin of error of plus or minus 1.2 percentage points. The survey found that most families (96%) will invest in new school supplies like notebooks, folders, pencils, backpacks and lunchboxes, accounting for $4.37 billion in spending.

The latest nail in ObamaCare’s coffin

Count it as another nail in ObamaCare’s coffin: Humana, one of the country’s top insurers, announced Thursday that it’s pulling out of ObamaCare exchange plans in all but a few states next year.

It will offer policies in “no more” than 11 state marketplaces, down from 19. The numbers don’t add up: Humana took nearly $1 billion in losses from the coverage this year. This follows the exit from the exchanges of such other giants as Cigna and UnitedHealth Group, also after outsized losses.

It’s the much-feared “death spiral”: Too many older, sicker folks are resorting to ObamaCare policies, and not enough younger, healthy folks. So the average enrollee is running up higher bills than the insurers expected — and raising rates will only scare away even more lower-cost customers.

Meanwhile, the Obama Justice Department is moving to block health-insurer mergers — including an Anthem-Cigna deal as well as Aetna’s bid to buy Humana. Why? As The Post’s Josh Kosman reports, the “move would be a blow to the president’s state-focused ObamaCare.” The White House fears the mergers would give the combined firms too much power to set rates, limiting consumer options.

Miami judge: Bitcoin isn't money

A Miami judge ruled Monday that Bitcoin is not really money in a closely-watched decision that dismissed charges against a local man for illegally selling and laundering the virtual currency.

Miami-Dade Circuit Court Judge Teresa Mary Pooler said that Bitcoin coin was not “tangible wealth” and “cannot be hidden under a mattress like cash and gold bars,” according to the Miami Herald. She also noted it also isn’t backed by a government or bank.

Defendant Michell Espinoza was arrested and charged with selling $1,500 worth of Bitcoins to undercover detectives who said they would use the money to buy stolen credit card numbers. A co-defendant pleaded guilty to acting as an unlicensed money broker and was sentenced to probation, according to the Herald.

In an eight page order, Pooler wrote that Bitcoin “has a long way to go before it is the equivalent of money.” She also said Florida’s money-laundering laws, which say someone can be charged for engaging in a transaction to “promote” illegal activity, are too vague to apply to the digital currency.

NYPD Officers to Get More Gear

Why Oil Prices Are On A Crash Course This Fall

Refining maintenance season is a few weeks away, a period of time that could be hugely negative for oil prices. Already the oil markets are dealing with record levels of oil and petroleum products sitting in storage, but a refining lull would put a major dent in oil demand. While the maintenance season is temporary, it could keep oil prices low for the next several months.

Between the months of July and October, purchases of crude oil from the refining industry in the U.S. has declined by roughly 1.2 million barrels per day over the past five years. "People are looking ahead to the fall and are worried," Michael Lynch, president of Strategic Energy & Economic Research, told Bloomberg in an interview. "There’s more and more talk of prices going south of $40 and as a result people are going short."

Gasoline inventories remain at extraordinary high levels, only down slightly from record highs. Several weeks of increases in the level of gasoline sitting in storage has weighed on the markets. Worse, the high inventories come at a time when oil traders expected them to fall because of summer driving season. Unfortunately for oil bulls, they have not.

Crude oil inventories have declined for about ten consecutive weeks, but still are extremely high. And the drawdowns could come to an end, or at least narrow, if refiners cut back on purchases during maintenance season.

Bernie Sanders’ Calls for Unity at Democratic Convention Draws Boos

The faithful aren’t ready to give up. Bernie Sanders urged his fans Monday to vote for Hillary Clinton, but his supporters responded with a chorus of boos that highlighted the depths of Democratic disunity.

“We have got to defeat Donald Trump. And we have got to elect Hillary Clinton and Tim Kaine,” Sanders told supporters just hours before the Democratic National Convention kicks off here. The faithful, who crowded into a Philadelphia auditorium to hear the Vermont Senator tout the campaign’s successes, responded with jeers.

Among the achievements Sanders celebrated was the resignation Sunday of Democratic National Committee chairwoman Debbie Wasserman Schultz, who announced she would step down at the conclusion of the convention in the wake of an email hack that suggested she and her staff had improperly sought to influence the outcome of a long and bitter primary.

Wasserman Schultz’s resignation “opens up the possibility of new leadership at the top of the Democratic Party,” Sanders said to deafening applause. “That will open the doors of the party to those people that want real change.”

NEWS to Disturb the Comfortable...

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