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Thursday 02.09.2017

We’re Not Tired of Winning Yet

It has been three weeks since you were sworn in as the 45th president of the United States. Since then, you effectively have fulfilled a surprising number of campaign pledges to us through the judicious use of executive orders. The Left is carrying on in total meltdown mode. It has been exhilarating to watch. With each announcement of a new initiative or executive order, the Left’s breakdown accelerates.

In the last few days, however, the mainstream media have circulated stories suggesting your administration is already losing steam. In typical fashion, these negative press reports have sent the cowardly “GOP surrender caucus” running for the exits. You helped compound this narrative when you indicated that it would take at least a year to repeal the inaptly named Affordable Care Act. What’s more, Republican Speaker of the House Paul Ryan has said it might take 200 days or more to implement your 100-day agenda, even though (he claims) he still believes in it.

These statements, taken together with the initial media reports, have entered into the horrific establishment echo chamber. Their narrative, now, is that you are officially wavering. The old accusations that you were never really serious about being a conservative president have begun reappearing. Still more, the Republicans in Congress—barely coalescing as it is—are starting to equivocate (as we saw with the DeVos confirmation vote).

During the campaign, Mr. President, you said that under your administration, the United States was going to win so much that we’d be “tired of winning.” After 19 days, I can assure you, Mr. President, we are not tired of winning. In fact, our appetite is not even close to being sated. You still have more work to do. I say “you” instead of the “Republicans” because, let’s face it, the congressional GOP is itching for a reason to abandon you. Don’t give them one by making statements about pushing back the repeal of Obamacare by a year, please.

A recession indicator mysteriously sprang up in January, and analysts don't know why

Gasoline purchases can be a powerful signal about the consumer economy, and last month's drop off in demand was downright recession-like.

But economists don't see a recession, and energy analysts say demand picked back up in the last week to a more normal level. Now, they are waiting to see if that continues, and to see if a massive gasoline glut begins to disappear.

In a report Wednesday, Goldman Sachs analysts said while they don't believe there is a recession, they noted that the implied drop of 460,000 barrels a day in January, or 5.2 percent year over year, is the kind of tumble seen only during a recession.

"…such a decline has only occurred in four periods since 1960, during which time PCE contracted," the analysts wrote. They note that government data on consumption — personal consumption expenditures, or PCE — dropped sharply at the same time in those other periods, but it is not lower right now. PCE, personal consumption expenditure, is expected to grow by 2.6 percent in the first quarter.

Is Gold Preparing For Another Brexit-style Rally?

Gold is again in the spotlight with the metal up at three-month highs. Prices have been moving higher for seven of the last nine trading sessions and have recorded their fifth consecutive positive daily close. The last time the yellow metal acted this way was just ahead of the Brexit vote last June.

And yet, one veteran trader is still not convinced gold’s momentum can last. “I see gold has a lot of buyers but it will exhaust itself soon,” Todd “Bubba” Horwitz, chief strategist for BubbaTrading.com, told Kitco News Wednesday.

“It could go as high as $1,300 but I still see one more shot to the downside.” Gold prices are trading higher Wednesday as investors continue to seek safe-haven investments in an environment of low yields and growing geopolitical uncertainty. April Comex gold futures settled the session at $1,239.50 an ounce, up 0.28% on the day.

Last June, gold prices rallied ahead of the Brexit referendum, which resulted in the U.K. voting to leave the European Union. The growing uncertainty leading up to the event saw gold prices rally for eight out of nice consecutive trading sessions, to finally pop on the day the referendum results came out.

Intel to invest $7 billion in AZ factory; 3,000 people to be employed

Intel has announced that it will invest $7 billion in a factory in Chandler, Arizona. That factory would employ up to 3,000 people. Intel chief executive Brian Krzanich made the announcement during a meeting with President Donald Trump on Wednesday.

Intel also says 10,000 people in the Arizona area will support the factory. Krzanich said that Intel will be completing the factory and making "the most advanced" chips on the planet." The CEO says the factory will employ about 3,000 workers directly -- and 10,000 workers in Arizona in support of the factory.

Krzanich says the announcement comes partly in response in part to Trump's tax and regulatory policies.

Trump calls the product that Intel will be making is "amazing."

Peter Schiff-Fed Will Sacrifice Dollar to Prop Up Bonds

BlackRock CEO Fink sees 'dark shadows' in financial markets

BlackRock Chief Executive Larry Fink on Wednesday said the U.S. economy is in the midst of a slowdown and financial markets could see a significant setback, because of uncertainty over global trade and the Trump administration's plan to cut taxes. "I see a lot of dark shadows," he said at an event hosted by Yahoo. "The markets are probably ahead of themselves."

Fink, whose company manages $5.1 trillion in assets, said investors are caught up in the potential for a restructuring of U.S. tax policy, which may not take place until 2018. But disruptions to trade are a possibility in the meantime, he said.

U.S. President Donald Trump has called for tax cuts as well as a wide set of changes to trade policy, including a renegotiation of the North American Free Trade Agreement with Canada and Mexico.

"We're living in a bipolar world right now," Fink said. "In my conversations with CEOs in Europe and CEOs in the United States they may be very bullish about what may come but most business people are not investing today." Fink is the latest major figure to call for a dose of caution after Trump's election touched off a rally in U.S. stocks. Bond investors Jeffrey Gundlach and Bill Gross are among those who have said the same in recent weeks.

EU Seeks Cash Limits in Push for Orwellian “Cashless Society”

As the establishment's global push for an Orwellian “cashless society” kicks into high gear, the European Union is pursuing a plan to impose limits on cash transactions as the next phase in the war on cash. The goal, according to the unelected EU bureaucrats behind the plot, is to fight “anonymity” in economic transactions — or, said another way, to crush privacy and give authorities the power to monitor every exchange.

Amid a United Nations-led effort to sideline cash and privacy around the world, the EU's anti-cash move follows similar schemes by a number of national governments within and beyond the EU in recent years. However, as the effort picks up steam, critics are lambasting the controversial agenda from all angles, highlighting the dangers of the plan and the huge threat it poses to privacy, freedom, and real human rights.

Under the proposed EU scheme, limits would be placed on cash transactions across the bloc, effectively banning any anonymous exchanges over a specified value. “Cash has the important feature of offering anonymity to transactions,” complain the EU bureaucrats behind the push in a section of their proposal outlining the supposed “problem” that their plot aims to tackle. “Preventing the anonymity linked to cash payments is the main driver," they continue.

The document acknowledges that, because the objective is to “prevent the anonymity that cash payments allow,” the scheme “might be viewed as an infringement of the right to privacy.” But the unelected bureaucracy dismisses those concerns because the EU's “charter” allows rights to be trampled if the trampling is alleged to be “necessary” to “meet objectives of general interest recognized by the Union.”

Wet Seal Will Liquidate And Close 137 Remaining Stores

Attention, fashionable yet casual Consumerists: Get ready to head to your local mall if you’ve ever liked any products from clothing and accessories seller Wet Seal. The company is closing nationwide, which means selling everything from the clothes left on the racks to its office equipment.

If you’ve ever wondered where the chain’s name came from, perhaps it might help to know that it began in southern California in 1962 as a surf-inspired fashion retailer called Lorne’s, eventually re-branding as Wet Seal in 1990. The chain acquired Contempo Casuals in 1995, later re-branding those stores as Wet Seal.

The chain had hundreds of stores before its first Chapter 11 in 2015, closing most of them before being purchased out of bankruptcy by Versa Capital Management, a firm that specializes in buying distressed retailers.

The last few years haven’t been good ones for fashion brands focusing on teen apparel. Fellow brands offering surf gear or surfing-inspired clothes Quiksilver and Pacific Sun went bankrupt but re-organized and remaining open. Hundreds of Aeropostale stores were rescued by a coalition of branding experts an mall landlords and will remain open, but American Apparel’s retail stores and The Limited will not be so lucky.

Is Sears toast? Retailer's stock hits all-time low

This is how bad things are at Sears. Shares of the once proud retailer plunged nearly 15% on Tuesday and hit their lowest level ever since its merger with Kmart back in 2005. There was no specific news to explain why shares fell. But rumors of impending doom for the company have been swirling for some time as sales continue to plunge and losses mount.

In January, the company announced plans to sell 150 Sears and Kmart stores and sold its iconic Craftsman line of tools to Stanley Black & Decker (SWJ). Sears also closed 78 stores last year and more than 200 in 2015 and has plans to sell its Kenmore appliance and Diehard auto parts brands too.

A spokesman for Sears (SHLD) would not comment on the stock's drop and the continued speculation about the retailer's future. The stock was up slightly Wednesday. But there is no denying that the issues facing Sears are dire. The stock is down nearly 40% so far this year. What's more, the price of one share of Sears is now dangerously close to $5.

Big mutual funds, pension funds and other large investment firms often dump shares of companies that fall below that price since they are considered to be penny stocks that tend to be more volatile.

Starbucks Now Wants to Give Employees Free Lawyers to Handle Trump Related Immigration Issues

Starbucks is really taking quite the stand against President Trump's anti-immigration rhetoric and policies. Below is a letter that went out to Starbucks employees on Monday that TheStreet has obtained. The coffee giant is now offering to provide employees and their families with free legal advice and guidance on immigration issues. Professional services firm Ernst & Young will be tasked with dispensing the guidance.

News of the letter was first reported by Buzzfeed News.

Partners, After the recent Executive Order placing restrictions on immigration and the subsequent legal challenges to its enforcement, we understand many partners still have questions about what this means for them. As you saw in Howard's message, we are putting our partners first and leading with humanity.

Our Partner Resources team has and will continue to proactively reach out to partners who we know are impacted by the Executive Order, and any related actions, to connect them to the legal resources needed for their individual scenarios. In addition, we are proud to announce a new service in partnership with the immigration arm of Ernst & Young; the Immigration Advisor Program. This service will allow all partners and family members to help navigate immigration issues and get answers in these uncertain times. If you are a partner or a family member and you have questions about immigration, travel restrictions, or how the Executive Order and any related actions may otherwise impact you, please access this legal support and guidance from the Global Mobility and Immigration team by clicking here or opening the attached email draft.

"Refugees" entering Canada from U.S. just beginning

Will Japan Save American Jobs? Trump, Shinzo Abe To Discuss Investments That Could Add Over 700,000 Positions

When President Donald Trump was on the campaign trail, one of his biggest promises was to create American jobs, vowing to stop companies from making jobs abroad. But it may not be Trump who generates the greatest number of manufacturing jobs during his first months as president — instead, it may be Japan. The country may create 700,000 jobs in the U.S., build a $7 billion factory and strengthen the American economy.

The jobs could come from a Japanese investment plan Japanese Prime Minister Shinzo Abe is expected to present Friday to Trump in Washington, D.C. "The investment will be by a Japanese consortium that will also include manufacturing equipment makers," an unidentified source told Reuters last week.

Japan was expected to invest in both private and public funds and focus on developing U.S. infrastructure by way of high-speed railways in Texas, California and the northeastern U.S. The plan would also create closer ties between Japan and the U.S. by including global infrastructure investment, artificial intelligence research, and collaboration on topics like space exploration and cybersecurity, according to Reuters.

The Japanese display maker Sharp Corp. was also considering building a plant in the U.S. during the first half of 2017, although Sharp has not confirmed whether the plant will be built.

IMF: Greek debt will become 'explosive' within 13 years

Greece's national debt is unsustainable and liable to become "explosive" once the country tries to refinance its loans at market interest rates from 2030, the International Monetary Fund said in a staff report.

The IMF staff said that additional austerity measures and spending cuts would not improve Greece's financial prospects in the longer term.

"The analysis suggests that Greece’s public debt is highly unsustainable," the IMF said. "Even with full implementation of policies agreed under the ESM program, public debt and financing needs will become explosive in the long run, as Greece will be unable to replace highly subsidized official sector financing with market financing at rates consistent with sustainability."

The organisation called on Greece's euro area peers to offer "significant debt relief" and hold back on forcing through more austerity reforms. "Greece has made enormous sacrifices to get to where it is now," the IMF said. "But the significant achievements in balancing the budget, closing the current account deficit, and improving the flexibility of the labor market have taken a heavy toll on the society and tested its endurance."

Rand Paul's 'Audit the Fed' bill may have friend in Trump

Top behind-the-scenes Fed official to step down

Federal Reserve general counsel Scott Alvarez, a key behind-the-scenes figure at the central bank who played a major role in its response to the financial crisis, will step down this year, the Fed announced Wednesday.

Alvarez, who has led the Fed's legal division for 12 years, doesn't have a major public profile, but he has shaped Fed regulatory policy through both the Ben Bernanke and Janet Yellen years, including some of the most famous and controversial bailout efforts. In recent years, he has come under some scrutiny from Congress for his role in divisive actions by the central bank.

"Scott advised successive chairs, including myself, with deep expertise and utmost integrity," Fed Chairwoman Janet Yellen said. "I am enormously grateful for his wise counsel, calmness and good humor during times of stress, and, above all, his intense dedication to the public interest served by the Federal Reserve."

Alvarez helped design the Fed's 2008 bailout of insurer American International Group, the terms of which were later endlessly debated by commentators who saw the rescue as a backdoor bailout of Wall Street and which later became the subject of a high-profile court case.

Bank tellers are the next blacksmiths

Self-driving cars. Self-serve gas pumps. Self-checkout supermarkets. Add self-banking to that list.

No people. No tellers. Nobody greeting you with “How is your day going?” Although, that may come from a machine — and sooner than you think. Bank of America has opened three mini-bank branches­ since the new year that have ATMs and video­conferencing but no people. Two opened in Denver and one in Minneapolis.

In addition to the ATMs, the new robo-banks — called automated centers — allow customers to make a video­conference call to a Bank of America employee at another location to discuss more complicated money issues.

“This is the beginning of the end of the American bank branch,” said Peter Fitzgerald, a former U.S. senator from Illinois, lifelong banker and founder of Chain Bridge Bank in McLean, Va. “Bank branches are dead. They were killed by the iPhone. It’s like the horseshoe when the automobile came along.” According to figures compiled by the Federal Deposit Insurance Corp. and supplied by the American Bankers Association, the number of U.S. bank employees has remained relatively stable. There were 2,110,276 employees in 2012, and 2,043,480 last year. But the number of U.S. bank branches has declined precipitously from a peak of 99,540 in 2009 to 91,861 in the third quarter of 2016, according to the ABA.

Senators Want To Know Why Price Of Lifesaving Drug Went From $690 To $4,500

As you’re probably all too aware, the U.S. is in the midst of an opioid epidemic, meaning that some life-saving overdose treatments have become crucial tools for hospitals, law enforcement, first responders, and families of addicts. At the same time, the makers of one such vital drug have raised the price by more than 600% since 2014, drawing the attention of lawmakers who want to know why.

This morning, 31 U.S. Senators sent a letter to the CEO of Virginia-based Kaléo Pharmaceuticals, seeking information on the soaring price of the company’s Evzio (naloxone) injectors.

Since 2014, the cost of twin pack of Evzio has jumped from $690 to $4,500 without any apparent reason for such a dramatic change in cost. “This drug is now in the hands of first responders and families struggling with substance use disorder across the country,” reads the letter, noting that more than 30,000 Americans die each year from opioid overdose. “It is particularly needed in rural areas where access to life-saving emergency services can be limited. Such a steep rise in the cost of this drug threatens to price-out families and communities that depend on naloxone to save lives.”

Though intravenous, generic naloxone is significantly more affordable than Evzio, it is not as easy to use for a layperson as an auto-injector like Evzio. So the choice is between having access to the treatment but not being sure you’ll be able to administer it properly when the time comes, or having a user-friendly version of the drug that most people can’t afford.

Italy’s Banking Crisis Is Even Worse Than We Thought

In this late winter of generalized discontent, it is not easy to pinpoint just where the biggest threat to Europe’s increasingly flimsy union lies, so intense is the competition. One obvious contender is the Eurozone’s third largest economy, Italy, which faces a banking crisis, an economic crisis, a debt crisis, and a political crisis all at the same time.

The country’s Five Star Movement is gaining momentum both in the polls and in its efforts to call for a referendum on euro membership. In the meantime, Italy’s newly installed government wants — indeed, needs — to bail out a growing number of banks but has neither the money nor the political capital to do so.

Things had gotten so bad that the country’s two bad banks (Atlante I and Atlante II), ostensibly created to stabilize the financial system, were themselves on the verge of collapse. Turns out that things are even worse than we had thought, following a blistering tirade on Tuesday from Italy’s bad banker-in-chief, Alessandro Penati.

“There is no clear vision of the problem and no strategy,” Penati told a financial conference in Milan, according to Reuters. He said he was virtually working alone on rescues that had revealed “horror stories” within some banks. In short, the insider blame game has begun.

The US Is Subsidizing Daycare In Puerto Rico

Puerto Rico’s subsidized daycare program jeopardized $16.2 million in U.S. taxes to endanger poor children, according to a new Health and Human Services (HHS) Inspector General (IG) report.

Puerto Rico’s social work agency failed to properly vet daycare providers or families in 99 out of the 100 childcare vouchers the IG reviewed, risking $16.2 million out of the $16.3 million spent through the Child Care and Development Fund Program from October 2011 to March 2013, according to the IG.

Puerto Rico’s Department of the Family failed to comply with background check requirements for providers in 90 percent of reviewed cases, only required proper childcare licensing for 47 percent of reviewed providers, and failed to document family eligibility in 6 percent of reviewed cases.

“These deficiencies left the Child Care and Development Fund Program vulnerable to fraud, waste, and abuse, and deficiencies in the controls for background checks and provider forms place the health and safety of children at risk,” the IG said.

Karl Rove: Tax reform bill will happen

World Famous Investor Buying Gold Again

While following what some of the world’s greatest investors are doing is not always a guarantee of success, one thing is for sure: they didn’t get there as a result of a poor long-term track record. When we saw one of Wall Street legendary investors reversing back to a positive stance on gold, after changing his mind and getting out after the election, it caught our attention.

Stanley Druckenmiller has reversed ground on gold and is buying the precious metal again. This is a quick about-face, as the legendary investor, who carved out an incredible record that started with George Soros and continued at Duquesne Capital, which he closed in 2010, got out of gold after the election in November.

Druckenmiller cited comments from central bankers on economic growth as a key reason for returning to the gold trade. We screened the Merrill Lynch research database, and found four stocks that make good sense for investors to add to their portfolios now, and all are rated Buy. We also included an exchange trade fund in which investors can buy shares that represent actual gold bullion holdings.

This top stock has remained a long-time Wall Street favorite. Agnico Eagle Mines Ltd. (NYSE: AEM) is a senior Canadian gold mining company that has produced precious metals since 1957. Its eight mines are located in Canada, Finland and Mexico, with exploration and development activities in each of these regions, as well as in the United States and Sweden. The company and its shareholders have full exposure to gold prices due to its long-standing policy of no forward gold sales. Agnico Eagle has declared a cash dividend every year since 1983.

Housing costs weighing on Baby Boomers

A number of recent surveys have found anxiety among Baby Boomers about retirement, primarily concerns about not having enough money.

The NHP Foundation, a not-for-profit provider of affordable housing, has drilled a little deeper into those concerns. It says a poll of Americans aged 55 and older found the cost of putting a roof over their heads is a major issue.

The survey found 30% of Boomers worry at least once a month that they won't be able to afford their home. About 42% of retired people in the survey say they worry about it at least once a day. While Millennials are known to have housing anxiety, caught between high rent and rising home prices, Boomers were thought to be more housing secure. But it turns out many Boomers who don't worry about their own housing costs do worry about those of their adult children.

"The anxiety is now multi-generational," said NHPF CEO Richard Burns. "So we are working today to increase our stock of affordable housing to ensure that this and future generations are able to afford desirable places to live." Previous NHP surveys have uncovered other concerns about housing affordability. One discovered that up to 75% of the U.S. population is worried at any given moment about losing their home. One that focused exclusively on Millennials found 76% of the younger generation had made compromises to secure affordable housing.

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