Rally Failure = Spike Down This Afternoon

INVESTOR’S first read.comDaily edge before the open
DJIA: 23,848
S&P 500: 2,605
Nasdaq Comp.: 6,949
Russell 2000: 1,513

Friday, March 29, 2018  9:15 a.m.
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NOTE:  I was in the Duke University hospital last week for an aortic heart valve replacement, so I missed the “fireworks.”

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      This volatility is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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TODAY – MONDAY 
        
 Picture an evenly matched rugby game between two teams that don’t like each other, with the ball never getting too close to either goal line.
         We have here, war between bulls and bears.
         The case for the bulls is obvious – business couldn’t be better.
         The case for the bears is stocks have discounted that and the economic recovery has extended far beyond the norm as the consumer’s spending power is being taxed by debt and a historically low savings rate. Worse yet, The Trump administration is in chaos, Republican control of Congress could swing to the Democrats, which a Wall Street would find bearish.
          While I believe January  26 marked the top for the March 2009 to 2018 bull market, I think one more strong thrust up as earnings are reported could happen. I also believe the BIG money will be selling into the buying these great earnings reports will generate eventually turning the market down with a slide lasting until October.

          Why then has the market weakened after 14 months of unrelenting strength ?
           Is the Street concerned that the Fed will amp up its tightening ?
           Is the Street worried about the prospect of an implosion of Trump’s administration and a big win for Democrats in November ?
           Is the Street worried that stock valuations are far too high ?
           Does the Street see a recession starting in 2019 (as I do) ? 
           Business can’t get better, but the economic recovery started nine years ago is due to crap out in face of too much corporate and consumer debt, and the prospect for the unwinding of  so many derivatives  held by financial institutions.
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SUPPORT “today”:DJIA:23,726; S&P 500:2,2,595;  Nasdaq Comp.:6,6,920
RESISTANCE “today” DJIA:23,996; S&P 500:2,621; Nasdaq Comp.:6.989
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RECENT     

      While I believe we have seen the highs for the 2009 to 2018 bull market , at least for the S&P 500 and DJIA, I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that is becoming increasingly likely, and would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
      The market should move higher as the Q1 earnings report period nears, and especially when sharply higher earnings reports roll in.

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Trump and the 25th:

      Always lurking out there is the possibility President Trump will attempt to obstruct the Mueller investigation, and that could adversely impact the market and in time, the economy, as uncertainty about governance mounts.
      This would create a constitutional crisis, and an attempt to remove him from office.  This Republican Congress would never impeach him, it can’t conduct  an impartial investigation of the Russia meddling issue on its own.
      Section 4 of the 25th Amendment  is a possibility, but that would require a vote to remove by 8 of the 15 Cabinet members. See below: “Removing Trump From Office”)

     This may explain what the remake of Trump’s new cabinet is all about, the construction of a firewall against the removal using the 25th.
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Flawed trickle down economics is back with Larry Kudlow soon to be the new head of the National Economic Council.  Pssst !  It doesn’t trickle down,  corporations  keep it all for themselves.
      When the recession comes, it will be the consumer who triggers it.  They are tapped out, too much debt, too little savings and no meaningful increase in pay adjusted for inflation for decades.
      Corporations got a 40% tax cut. What will they spend this freebie on, capital goods investment, or stock buybacks ? Probably mostly the latter. With a recession looming in the future, why would they spend a lot on capital expansion ?       
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THE FED
     Last week’s carnage was an example of  the kind of freefall I have warned could happen if a lot of institutions bailed out simultaneously.
     There is still a possibility of one last surge as indicated above, but new highs are doubtful.  That rally should top out in April/May as the full impact of Q1 earnings hit.

      The Fed’s FOMC meets last week with a press conference by newly appointed Fed Chief, Jerome Powell, on Wednesday at 2:30.  Expect another rate increase to 1.75 from 1.50. Street is looking for assurance the Fed won’t be raising rates four times this year rather than three. I don’t think we will see even a hint of that until the June  12-13 meeting.

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POLITICAL/STOCK MARKET
I WAS HEARTENED, EMOTIONALLY MOVED BY WHAT I SAW LAST WEEKEND. CLEARLY, OUR YOUNG STUDENTS  ARE SPEARHEADING  A MOVEMENT TO FORCE CONGRESS TO ACKNOWLEGE THE NEED FOR SAFER SCHOOLS AND COMMON SENSE ABOUT THE GUNS,  CHOOSE OUR CHILDREN’S INTERESTS OVER THOSE OF THE NRA.
       THESE YOUNG PEOPLE AREN’T WAITING TO INHERIT A GREATER MESS THAN THIS ADMINISTRATION IS CREATING.
         THEY WANT TO CHANGE IT NOW.  UNLIKE SO MANY ADULTS, THEY REFUSE TO BE  PUPPITS OF THE NRA, SHAMING MANY PARENTS AND ADULTS  INTO ACTION TO READ THE RIOT ACT TO CONGRESS.  THIS ONE IS BIG !
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TRUMP – A human Wrecking ball ?   My headline  on January 3, 2017
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TRUMP – our current day   Edsel ?
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Firing Deputy FBI Director Andy McCabe 26 hours before his retirement to deprive him of a pension earned over 20 years is 100% political and stands to backfire on Republicans.  This is the kind of thing we should expect in a banana republic.
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Cambridge Analytica is center stage again. Palmer.com  reports  someone behind the scenes is trying to block  Britain’s  Channel 4 News from airing an expose  into Cambridge’s role in using  Facebook (FB) to influence voters to vote for Trump and not Clinton.  On Friday,  Facebook  banned Cambridge’s access.  Palmer speculates the Mercers are behind the  attempt to prevent Channel 4’s expose.  I was on Cambridge’s case on June 22,  noting that billionaire Robert Mercer was connected to Cambridge through Canada’s Aggregate IQ through an intellectual property agreement and worked to influence voting  in the Brexit referendum.  Aggregate is a data mining company.  (See below: Mercer on the run ?)

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Remember the name Felix Sater, former business associate of Trump, convicted  Russian mafia money laundering figure, and key FBI informant.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
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Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout ,  March 4.
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TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
      
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
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        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
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U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
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SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
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WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
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The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
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RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
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The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
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TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
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  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tug of War Between Bulls and Bears To Be Resolved This Week

INVESTOR’S first read.comDaily edge before the open
DJIA: 23,857
S&P 500: 2,616
Nasdaq Comp.:7,008
Russell 2000: 1,510

Wednesday, March 28,  2018  9:15 a.m.
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NOTE:  I was in the Duke University hospital last week for an aortic heart valve replacement, so I missed the “fireworks.”

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      This volatility is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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TODAY – MONDAY 
         Picture a tug of war
with first one side looking like it was winning, then the other side reversing the tide just about time someone was going to get wet.
         We have here, war between bulls and bears.
         The bulls were out of the gate early yesterday, running stocks up looking like nothing could stop them.   Then they hit a wall, buyers backed off and sellers moved in driving the market down below the prior day’s low.
         This extreme volatility indicates confusion, and a marked disagreement about the future direction of the market.
          On the surface this doesn’t make sense.  The economy is stable and growing in spots, and corporate earnings are projected for double digit growth  throughout the year.
           While I believe January  26 marked the top for the March 2009 to 2018 bull market, I think one more strong thrust up as earnings are reported could happen. I also believe the BIG money will be selling into the buying these great earnings reports will generate eventually turning the market down with a slide lasting until October.

          Why then has the market weakened after 14 months of unrelenting strength ?
           Is the Street concerned that the Fed will amp up its tightening ?
           Is the Street worried about the prospect of an implosion of Trump’s administration and a big win for Democrats in November ?
            Is the Street worried that stock valuations are far too high ?
            Does the Street see a recession starting in 2019 (as I do) ? 
            Business can’t get better, but the economic recovery started nine years ago is due to crap out in face of too much corporate and consumer debt, and the prospect for the unwinding of  so many derivatives  held by financial institutions.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
SUPPORT “today”:DJIA:25,501; S&P 500:2,578;  Nasdaq Comp.:6,936
RESISTANCE “today” DJIA:23.876; S&P 500:2,628; Nasdaq Comp.:7.076
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RECENT     

      While I believe we have seen the highs for the 2009 to 2018 bull market , at least for the S&P 500 and DJIA, I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that is becoming increasingly likely, and would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
      The market should move higher as the Q1 earnings report period nears, and especially when sharply higher earnings reports roll in.

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Trump and the 25th:

      Always lurking out there is the possibility President Trump will attempt to obstruct the Mueller investigation, and that could adversely impact the market and in time, the economy, as uncertainty about governance mounts.
      This would create a constitutional crisis, and an attempt to remove him from office.  This Republican Congress would never impeach him, it can’t conduct  an impartial investigation of the Russia meddling issue on its own.
      Section 4 of the 25th Amendment  is a possibility, but that would require a vote to remove by 8 of the 15 Cabinet members. See below: “Removing Trump From Office”)

     This may explain what the remake of Trump’s new cabinet is all about, the construction of a firewall against the removal using the 25th.
……………………………………………….
     
Flawed trickle down economics is back with Larry Kudlow soon to be the new head of the National Economic Council.  Pssst !  It doesn’t trickle down,  corporations  keep it all for themselves.
      When the recession comes, it will be the consumer who triggers it.  They are tapped out, too much debt, too little savings and no meaningful increase in pay adjusted for inflation for decades.
      Corporations got a 40% tax cut. What will they spend this freebie on, capital goods investment, or stock buybacks ? Probably mostly the latter. With a recession looming in the future, why would they spend a lot on capital expansion ?       
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THE FED
     Last week’s carnage was an example of  the kind of freefall I have warned could happen if a lot of institutions bailed out simultaneously.
     There is still a possibility of one last surge as indicated above, but new highs are doubtful.  That rally should top out in April/May as the full impact of Q1 earnings hit.

      The Fed’s FOMC meets last week with a press conference by newly appointed Fed Chief, Jerome Powell, on Wednesday at 2:30.  Expect another rate increase to 1.75 from 1.50. Street is looking for assurance the Fed won’t be raising rates four times this year rather than three. I don’t think we will see even a hint of that until the June  12-13 meeting.

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POLITICAL/STOCK MARKET
I WAS HEARTENED, EMOTIONALLY MOVED BY WHAT I SAW OVER THE WEEKEND. CLEARLY, OUR YOUNG STUDENTS  ARE SPEARHEADING  A MOVEMENT TO FORCE CONGRESS TO ACKNOWLEGE THE NEED FOR SAFER SCHOOLS AND COMMON SENSE ABOUT THE GUNS,  CHOOSE OUR CHILDREN’S INTERESTS OVER THOSE OF THE NRA.
       THESE YOUNG PEOPLE AREN’T WAITING TO INHERIT A GREATER MESS THAN THIS ADMINISTRATION IS CREATING.
         THEY WANT TO CHANGE IT NOW.  UNLIKE SO MANY ADULTS, THEY REFUSE TO BE  PUPPITS OF THE NRA, SHAMING MANY PARENTS AND ADULTS  INTO ACTION TO READ THE RIOT ACT TO CONGRESS.  THIS ONE IS BIG !
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TRUMP – A human Wrecking ball ?   My headline  on January 3, 2017
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TRUMP – our current day   Edsel ?
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Firing Deputy FBI Director Andy McCabe 26 hours before his retirement to deprive him of a pension earned over 20 years is 100% political and stands to backfire on Republicans.  This is the kind of thing we should expect in a banana republic.
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Cambridge Analytica is center stage again. Palmer.com  reports  someone behind the scenes is trying to block  Britain’s  Channel 4 News from airing an expose  into Cambridge’s role in using  Facebook (FB) to influence voters to vote for Trump and not Clinton.  On Friday,  Facebook  banned Cambridge’s access.  Palmer speculates the Mercers are behind the  attempt to prevent Channel 4’s expose.  I was on Cambridge’s case on June 22,  noting that billionaire Robert Mercer was connected to Cambridge through Canada’s Aggregate IQ through an intellectual property agreement and worked to influence voting  in the Brexit referendum.  Aggregate is a data mining company.  (See below: Mercer on the run ?)

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Remember the name Felix Sater, former business associate of Trump, convicted  Russian mafia money laundering figure, and key FBI informant.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
……………………………………..

Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout ,  March 4.
………………………………………………………
TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
 ………………………………………..
        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
………………………………………….
U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
…………………………………………

SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
……………………………………………
WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
>>>>>>>>>>>>>>>
The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
……………………………………………………
RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
.…………………………
The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
 ……………………………………………………………………………
TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
……………………………………
  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Key: Market Reaction to Q1 Earnings in April

INVESTOR’S first read.comDaily edge before the open
DJIA: 24,202
S&P 500: 2,658
Nasdaq Comp.:6,9927,220
Russell 2000: 1,543

Tuesday, March 27,  2018  9:15 a.m.
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NOTE:  I was in the Duke University hospital last week for an aortic heart valve replacement, so I missed the “fireworks.”

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      This volatility is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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TODAY – MONDAY 
        We got the rebound I expected, though it overshot my projection.
         Q1 earnings will begin to roll in in April and they will be impressive, in fact all of 2018 are expected to be good.
         Even so, it is the extent to which the market is overvaluing  earnings and what happens in 2019 when I expect a recession to begin that concerns me.     
 

Assuming no huge crisis internationally or an implosion of the Trump administration, the market should mount a rebound as earnings are reported next month.
         Before the recent sell off, I thought we had a remote chance for one more rally to new highs before  a big selloff beginning in May/June, one taking the market down sharply into October.
         New Highs are a stretch, but a push up close to them is possible.       

         I expect the BIG money to sell into any rally driven by earnings, ergo the May/June plunge into October.
        Yesterday’s rally must hold above Friday’s lows  (DJIA:23,509, S&P 500:2,585, Nasdaq Comp.: 6,992) or any meaningful rally will have to start from lower levels.
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SUPPORT “today”:DJIA:24,057; S&P 500:2,641;  Nasdaq Comp.:7,167
RESISTANCE “today” DJIA:24,356; S&P 500:2,679; Nasdaq Comp.:7,263
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

RECENT     

      While I believe we have seen the highs for the 2009 to 2018 bull market , at least for the S&P 500 and DJIA, I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that is becoming increasingly likely, and would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
      The market should move higher as the Q1 earnings report period nears, and especially when sharply higher earnings reports roll in.

.…………………………………………
Trump and the 25th:

      Always lurking out there is the possibility President Trump will attempt to obstruct the Mueller investigation, and that could adversely impact the market and in time, the economy, as uncertainty about governance mounts.
      This would create a constitutional crisis, and an attempt to remove him from office.  This Republican Congress would never impeach him, it can’t conduct  an impartial investigation of the Russia meddling issue on its own.
      Section 4 of the 25th Amendment  is a possibility, but that would require a vote to remove by 8 of the 15 Cabinet members. See below: “Removing Trump From Office”)

     This may explain what the remake of Trump’s new cabinet is all about, the construction of a firewall against the removal using the 25th.
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Flawed trickle down economics is back with Larry Kudlow soon to be the new head of the National Economic Council.  Pssst !  It doesn’t trickle down,  corporations  keep it all for themselves.
      When the recession comes, it will be the consumer who triggers it.  They are tapped out, too much debt, too little savings and no meaningful increase in pay adjusted for inflation for decades.
      Corporations got a 40% tax cut. What will they spend this freebie on, capital goods investment, or stock buybacks ? Probably mostly the latter. With a recession looming in the future, why would they spend a lot on capital expansion ?       
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THE FED
     Last week’s carnage was an example of  the kind of freefall I have warned could happen if a lot of institutions bailed out simultaneously.
     There is still a possibility of one last surge as indicated above, but new highs are doubtful.  That rally should top out in April/May as the full impact of Q1 earnings hit.

      The Fed’s FOMC meets last week with a press conference by newly appointed Fed Chief, Jerome Powell, on Wednesday at 2:30.  Expect another rate increase to 1.75 from 1.50. Street is looking for assurance the Fed won’t be raising rates four times this year rather than three. I don’t think we will see even a hint of that until the June  12-13 meeting.

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POLITICAL/STOCK MARKET
I WAS HEARTENED, EMOTIONALLY MOVED BY WHAT I SAW OVER THE WEEKEND. CLEARLY, OUR YOUNG STUDENTS  ARE SPEARHEADING  A MOVEMENT TO FORCE CONGRESS TO ACKNOWLEGE THE NEED FOR SAFER SCHOOLS AND COMMON SENSE ABOUT THE GUNS,  CHOOSE OUR CHILDREN’S INTERESTS OVER THOSE OF THE NRA.
       THESE YOUNG PEOPLE AREN’T WAITING TO INHERIT A GREATER MESS THAN THIS ADMINISTRATION IS CREATING.
         THEY WANT TO CHANGE IT NOW.  UNLIKE SO MANY ADULTS, THEY REFUSE TO BE  PUPPITS OF THE NRA, SHAMING MANY PARENTS AND ADULTS  INTO ACTION TO READ THE RIOT ACT TO CONGRESS.  THIS ONE IS BIG !
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TRUMP – A human Wrecking ball ?   My headline  on January 3, 2017
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TRUMP – our current day   Edsel ?
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Firing Deputy FBI Director Andy McCabe 26 hours before his retirement to deprive him of a pension earned over 20 years is 100% political and stands to backfire on Republicans.  This is the kind of thing we should expect in a banana republic.
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Cambridge Analytica is center stage again. Palmer.com  reports  someone behind the scenes is trying to block  Britain’s  Channel 4 News from airing an expose  into Cambridge’s role in using  Facebook (FB) to influence voters to vote for Trump and not Clinton.  On Friday,  Facebook  banned Cambridge’s access.  Palmer speculates the Mercers are behind the  attempt to prevent Channel 4’s expose.  I was on Cambridge’s case on June 22,  noting that billionaire Robert Mercer was connected to Cambridge through Canada’s Aggregate IQ through an intellectual property agreement and worked to influence voting  in the Brexit referendum.  Aggregate is a data mining company.  (See below: Mercer on the run ?)

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Remember the name Felix Sater, former business associate of Trump, convicted  Russian mafia money laundering figure, and key FBI informant.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
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Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout ,  March 4.
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TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
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        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
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U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
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SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
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WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
>>>>>>>>>>>>>>>
The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
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RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
.…………………………
The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
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TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
……………………………………
  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Technical Bounce Before Good Earnings Must Hold

INVESTOR’S first read.comDaily edge before the open
DJIA: 23,533
S&P 500: 2,588
Nasdaq Comp.:6,992
Russell 2000: 1,510

Monday, March 26,  2018   8:51 a.m.
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NOTE:  I was in the Durham hospital last week for an aortic heart valve replacement and missed the “fireworks.”

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      This volatility is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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TODAY – MONDAY 
       
A normal technical rebound will greet investors this morning.
        A rally failure during the day which wipes out all or most of the day’s gain would mean the market needs another PLUNGE before weeding out enough sellers and attracting enough buyers to trigger a meaningful rebound.
        Assuming no huge crisis internationally or in the White House, the market should mount a rebound as impressive earnings reports roll in in April. 

        After the damage we have seen in the last 9 trading days, new highs in face of these earnings is doubtful.
         I expect the BIG money to sell into any rally setting the stage for  a May/June plunge into October.
         Buying at the open has its risks, since prices will jump sharply from Friday’s close.
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SUPPORT “today”:DJIA:23,600;S&P 500:2,590;  Nasdaq Comp.:6,700
RESISTANCE “today” DJIA:23,867; S&P 500:2,625; Nasdaq Comp.:7,081
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RECENT     

      While I believe we have seen the highs for the 2009 to 2018 bull market , at least for the S&P 500 and DJIA, I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that is becoming increasingly likely, and would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
      The market should move higher as the Q1 earnings report period nears, and especially when sharply higher earnings reports roll in.

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Trump and the 25th:

      Always lurking out there is the possibility President Trump will attempt to obstruct the Mueller investigation, and that could adversely impact the market and in time, the economy, as uncertainty about governance mounts.
      This would create a constitutional crisis, and an attempt to remove him from office.  This Republican Congress would never impeach him, it can’t conduct  an impartial investigation of the Russia meddling issue on its own.
      Section 4 of the 25th Amendment  is a possibility, but that would require a vote to remove by 8 of the 15 Cabinet members. See below: “Removing Trump From Office”)

     This may explain what the remake of Trump’s new cabinet is all about, the construction of a firewall against the removal using the 25th.
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Flawed trickle down economics is back with Larry Kudlow soon to be the new head of the National Economic Council.  Pssst !  It doesn’t trickle down,  corporations  keep it all for themselves.
      When the recession comes, it will be the consumer who triggers it.  They are tapped out, too much debt, too little savings and no meaningful increase in pay adjusted for inflation for decades.
      Corporations got a 40% tax cut. What will they spend this freebie on, capital goods investment, or stock buybacks ? Probably mostly the latter. With a recession looming in the future, why would they spend a lot on capital expansion ?       
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THE FED
     Last week’s carnage was an example of  the kind of freefall I have warned could happen if a lot of institutions bailed out simultaneously.
     There is still a possibility of one last surge as indicated above, but new highs are doubtful.  That rally should top out in April/May as the full impact of Q1 earnings hit.

      The Fed’s FOMC meets last week with a press conference by newly appointed Fed Chief, Jerome Powell, on Wednesday at 2:30.  Expect another rate increase to 1.75 from 1.50. Street is looking for assurance the Fed won’t be raising rates four times this year rather than three. I don’t think we will see even a hint of that until the June  12-13 meeting.

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POLITICAL/STOCK MARKET
I WAS HEARTENED, EMOTIONALLY MOVED BY WHAT I SAW OVER THE WEEKEND. CLEARLY, OUR YOUNG STUDENTS  ARE SPEARHEADING  A MOVEMENT TO FORCE CONGRESS TO ACKNOWLEGE THE NEED FOR SAFER SCHOOLS AND COMMON SENSE ABOUT THE GUNS,  CHOOSE OUR CHILDREN’S INTERESTS OVER THOSE OF THE NRA.
       THESE YOUNG PEOPLE AREN’T WAITING TO INHERIT A GREATER MESS THAN THIS ADMINISTRATION IS CREATING.
         THEY WANT TO CHANGE IT NOW.  UNLIKE SO MANY ADULTS, THEY REFUSE TO BE  PUPPITS OF THE NRA, SHAMING MANY PARENTS AND ADULTS  INTO ACTION TO READ THE RIOT ACT TO CONGRESS.  THIS ONE IS BIG !
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TRUMP – A human Wrecking ball ?   My headline  on January 3, 2017
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TRUMP – our current day   Edsel ?
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Firing Deputy FBI Director Andy McCabe 26 hours before his retirement to deprive him of a pension earned over 20 years is 100% political and stands to backfire on Republicans.  This is the kind of thing we should expect in a banana republic.
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Cambridge Analytica is center stage again. Palmer.com  reports  someone behind the scenes is trying to block  Britain’s  Channel 4 News from airing an expose  into Cambridge’s role in using  Facebook (FB) to influence voters to vote for Trump and not Clinton.  On Friday,  Facebook  banned Cambridge’s access.  Palmer speculates the Mercers are behind the  attempt to prevent Channel 4’s expose.  I was on Cambridge’s case on June 22,  noting that billionaire Robert Mercer was connected to Cambridge through Canada’s Aggregate IQ through an intellectual property agreement and worked to influence voting  in the Brexit referendum.  Aggregate is a data mining company.  (See below: Mercer on the run ?)

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Remember the name Felix Sater, former business associate of Trump, convicted  Russian mafia money laundering figure, and key FBI informant.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
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Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout ,  March 4.
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TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
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        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
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U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
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SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
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WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
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The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
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RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
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The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
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TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
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  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

Brace Yourselves

Investor’s first read.comDaily edge before the open
DJIA: 24,610
S&P 500: 2,712
Nasdaq Comp.:7,344
Russell 2000:

Tuesday, March 21,  2018   9:11 a.m.
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NOTE: I will not publish Wednesday  through Friday.
Hate to miss what could be FIREWORKS, Damn !

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      This volatility is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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TODAY – MONDAY 
     
The market is suddenly nervous about  the Fed’s Wednesday 2:00 p.m. report on interest rates and the increasing irrationality of President Trump.

      So far the Street has ignored the prospect that the Trump administration will implode in face of findings by Special counsel Robert  Mueller’s  investigation.
      Wall Street and corporations  got their tax cuts, and corporate earnings are projected to jump sharply this year, why should anyone worry ?
      The extreme volatility in this market boosts the spirits of bulls one day, bears the next.    But the bull is living on borrowed time, probably  three months more at best.

      As I have warned for months on end, investment decisions today are highly computerized raising the risk too many mega institutions will get a sell decision at the same time – the result being a flash crash, a drop of 12% to 18% over several days.
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While I believe we have seen the highs for the 2009 to 2018 bull market , at least for the S&P 500 and DJIA, I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that is becoming increasingly likely, and would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
      The market should move higher as the Q1 earnings report period nears, and especially as sharply higher earnings roll in.
All the makings :
      This has all the makings of one of those spectacular, orgasmic, explosive blow-offs to a nine year bull market, one that garners headlines and talk of a new era for stocks prior to a plunge in May/June.

      Bull markets don’t go gently, but this one is getting extremely pricey. Not only is the Shiller price/earnings ratio now up to 33.7 times earnings (vs average of 16.8) the price to sales ratio is at 2.32, well above the norm of 1.48.
      What is hard to accept  at bull market tops and bear market bottoms is, at tops everything looks great, at bottoms everything looks horrendous. 
      Humans can’t help getting caught up in the excitement of one big score after another in bull markets (Greed) or the overwhelming despair of a relentless pounding prior to a bear market bottom (fear).
      The BIG Money uses these blow-offs, since the increased volume enables them to move large blocks of stock without depressing prices.
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Trump and the 25th:

      Always lurking out there is the possibility President Trump will attempt to obstruct the Mueller investigation, and that could adversely impact the market and in time, the economy, as uncertainty about governance mounts.
      This would create a constitutional crisis, and an attempt to remove him from office.  This Republican Congress would never impeach him, it can’t conduct  an impartial investigation of the Russia meddling issue on its own.
      Section 4 of the 25th Amendment  is a possibility, but that would require a vote to remove by 8 of the 15 Cabinet members. See below: “Removing Trump From Office”)

     This may explain what the remake of Trump’s new cabinet is all about, the construction of a firewall against the removal using the 25th.
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Flawed trickle down economics is back with Larry Kudlow soon to be the new head of the National Economic Council.  Pssst !  It doesn’t trickle down,  corporations  keep it all for themselves.
      When the recession comes, it will be the consumer who triggers it.  They are tapped out, too much debt, too little savings and no meaningful increase in pay adjusted for inflation for decades.
      Corporations got a 40% tax cut. What will they spend this freebie on, capital goods investment, or stock buybacks ? Probably mostly the latter. With a recession looming in the future, why would they spend a lot on capital expansion ?       
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THE FED
      The Fed’s FOMC meets this week with a press conference by newly appointed Fed Chief, Jerome Powell, on Wednesday at 2:30.  Expect another rate increase to 1.75 from 1.50. Street is looking for assurance the Fed won’t be raising rates four times this year rather than three. I don’t think we will see even a hint of that until the June  12-13 meeting.

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SUPPORT “today”:DJIA:24,551;S&P 500:2,703;  Nasdaq Comp.:7,321
RESISTANCE “today” DJIA:24,673; S&P 500:2,717; Nasdaq Comp.:7,355
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POLITICAL/STOCK MARKET
TRUMP – A human Wrecking ball ?   My headline  on January 3, 2017
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TRUMP – our current day   Edsel ?
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Firing Deputy FBI Director Andy McCabe 26 hours before his retirement to deprive him of a pension earned over 20 years is 100% political and stands to backfire on Republicans.  This is the kind of thing we should expect in a banana republic.
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Cambridge Analytica is center stage again. Palmer.com  reports  someone behind the scenes is trying to block  Britain’s  Channel 4 News from airing an expose  into Cambridge’s role in using  Facebook (FB) to influence voters to vote for Trump and not Clinton.  On Friday,  Facebook  banned Cambridge’s access.  Palmer speculates the Mercers are behind the  attempt to prevent Channel 4’s expose.  I was on Cambridge’s case on June 22,  noting that billionaire Robert Mercer was connected to Cambridge through Canada’s Aggregate IQ through an intellectual property agreement and worked to influence voting  in the Brexit referendum.  Aggregate is a data mining company.  (See below: Mercer on the run ?)

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Remember the name Felix Sater, former business associate of Trump, convicted  Russian mafia money laundering figure, and key FBI informant.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
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Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout ,  March 4.
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TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
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        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
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U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
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SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
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WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
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The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
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RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
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The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
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TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
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  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mueller Crossing Trump’s “Red Line” ?

Investor’s first read.com Daily edge before the open
DJIA:24,873
S&P 500: 2,747
Nasdaq Comp.:7,481
Russell 2000: 1,576

Friday, March 16,  2018   9:11 a.m.
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      This is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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TODAY – FRIDAY

        Always lurking out there is the possibility President Trump will attempt to obstruct the Mueller investigation, and that could adversely impact the market and in time, the economy, as uncertainty about governance mounts.
       This would create a constitutional crisis, and an attempt to remove him from office.  This Republican Congress would never impeach him, it can’t conduct  an impartial investigation of the Russia meddling issue on its own.
        Section 4 of the 25th Amendment  is a possibility, but that would require a vote to remove by 8 of the 15 Cabinet members. See below: “Removing Trump From Office”)

       This may explain what the remake of Trump’s new cabinet is all about, a construction of a firewall against the removal using the 25th.
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  Larry Kudlow to be the new head of the National Economic Council.  Here we go again – the flawed trickle down economics !  Pssst !  It doesn’t trickle down,  corporations  keep it all for themselves.
      When the recession comes, it will be the consumer who triggers it.  They are tapped out, too much debt, too little savings and no meaningful increase in pay adjusted for inflation for decades. Corporations got a 40% tax cut. What will they spend this freebie on, capital goods investment, or stock buybacks.  Probably mostly the latter. With a recession looming in the future, why would they spend a lot on capital goods ?
 
     At a time when global issues demand solutions, 8 out of 10 key positions in our State Department are vacant.
      This is unacceptable incompetence at the highest levels. Dozens of staffers have left or been fired by President Trump.
       Our economy couldn’t get  stronger, and it won’t.  This is binge drinking time for the bulls, we are in the final stages of the bull market.  Another orgasmic surge is likely, then its straight downhill.
     
    While I believe we have seen the highs for the 2009 to 2018 bull market , I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
       Bull markets don’t go gently, but this one is getting pricey. Not only is the Shiller price/earnings ratio now up to 33.7 times earnings (vs average of 16.8) the price to sales ratio is at 2.32, well above the norm of 1.48.
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THE FED
      The Fed’s FOMC meets next week with a press conference by newly appointed Fed Chief, Jerome Powell, on Wednesday at 2:30.  Expect another rate increase to 1.75 from 1.50.

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SUPPORT “today”:DJIA:24,703;S&P 500:2,743;  Nasdaq Comp.:7,471
RESISTANCE “today” DJIA:25,037; S&P 500:2,755; Nasdaq Comp.:7,513
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RECENT:
        I think we have seen the highs for the 2009 – 2018 bull market. There is a good chance of one more spike to new highs driven by April’s Q1 earnings which are projected by Factset to increase 17% over a year ago.

       If we get one more surge to new highs after the recent January/February 12% plunge it would be a lot like that which occurred prior to the 2007 – 2009 bear market where  an 11.4% drop in July/August  2007 was followed by a 15% rally and to a new high on October 11, 2007 before the bear market’s 50% plunge. The new high in October exceeded the July high by a mere 1.2%.  It was the ultimate breakout/fake-out.
      This is why I am referring to  a “topping out” process for the bull market.
      Odds favor a  double top with the second top coming in May after a Q1 earnings spike.
      Beyond May, I expect a steady plunge ( 14% to 18%) into fall and the mid-term elections.  A 1987 style flash crash could develop before then with the same results.  Tariffs, or the implosion of the whole Trump administration  could be the trigger.
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NINE YEARS AGO:

March 10, 2009 (DJIA: 6,805)  My “BUY”  came in the face of a total meltdown on the Street when with the DJIA down 55%, no one wanted to buy stocks which contrasts with today when just about everyone wants to go all-in and borrow to do so.                                                                    
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WHAT COULD DERAIL BULL MARKET ?

        The 2009 to 2018 bull market IS still intact. What could derail it ?

        THE NEW ERA MENTALITY
       Google this ! Classic tunnel vision bull market mentality evidenced by Bloomberg article: “Stock Bulls in Trump Country Are Freaking Out Their Brokers.”    This is how the human mind works as late-stage bull markets approach  the end.  

       The myth that the 8-year bull market is unstoppable, that the Street’s decision process based on algorithms thought to be flawless weren’t programmed for reality, that bull markets and economic expansions age, that stocks that are grossly overvalued will return to historic norms and even go lower in face of mounting fears.

          The Shiller S&P 500’s price/earnings ratio (P/E), based on average inflation-adjusted earnings over 10 years CAPE)  is now 31.7 vs. a mean of 16.8. This overvaluation cannot survive the negatives that are looming in the intermediate-term future.

          THE FED
       The Fed has raised its federal funds rate since December 2015 with no effect on the stock market and has continued to raise rates ever  since in an effort to “normalize” rates after seven years of  a zero-based interest rate policy following the Great Recession/Bear Market.
        While the 10-year Treasury recently jumped to 2.91% (20-year average: 3.74%), and the 2-year Treasury hit a 9-year high triggering a drop in stock prices, these rates have since backed  down, triggering a rebound in the stock market     
 TRUMP ADMINISTRATION IMPLODING ?
The prospect of a huge political scandal is unfolding, one which could result in a constitutional crisis. So far, the Street is in denial, and initially may ignore indictments of Trump’s closest staff, ones who have departed, maybe Trump himself.  Dysfunctional as our government is, it can get even more so, in face of  attempts to fire thwart  Special Counsel Mueller’s investigation, the removal of Trump from office (impeachment, 25th Amendment, resignation, or the presidential pardons of  administration persons.

         That uncertainty, combined with rising interest rates and the downward adjustment in stock valuations can take this market south big time.

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POLITICAL/STOCK MARKET
Editor/publisher note:
      I have  been writing about the stock market and companies for 50 years and never injected politics in my thousands of commentaries during the most dynamic and treacherous era in stock market history.
      I have published investors first read.com daily before the open since mid-2008.  On January 3, 2017, I decided to add a political commentary because I sensed Republican control of the Presidency under Donald Trump , both houses of Congress, the Supreme Court and a major network news station  would be injurious to the preservation of our republic and economy.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
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Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout  March 4.
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TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, and  CIA’s  Mike Pompeo, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
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        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
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U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
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SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
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WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
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The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
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RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
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The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
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TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
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  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New Cabinet ? It’s All About 25th Amendment

Investor’s first read.com Daily edge before the open
DJIA:24,758
S&P 500: 2,749
Nasdaq Comp.:7,496
Russell 2000: 1,584

Thursday, March 15,  2018   7:37 a.m.
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      This is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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TODAY – THURSDAY  

      Trump’s new cabinet is all about a constructing a firewall against the removal of Trump from office by exercising section 4 of the  25th Amendment (see below: “Removing  Trump From Office.”)
    
  Larry Kudlow to be the new head of the National Economic Council.  Here we go again – the flawed trickle down economics !  Pssst !  It doesn’t trickle down,  corporations  keep it all for themselves.
      When the recession comes, it will be the consumer who triggers it.  They are tapped out, too much debt, too little savings and no meaningful increase in pay adjusted for inflation for decades. Corporations got a 40% tax cut. What will they spend this freebie on, capital goods investment, or stock buybacks.  Probably mostly the latter. With a recession looming in the future, why would they spend a lot on capital goods ?
 
     At a time when global issues demand solutions, 8 out of 10 key positions in our State Department are vacant.
      This is unacceptable incompetence at the highest levels. Dozens of staffers have left or been fired by President Trump.
       Our economy couldn’t get  stronger, and it won’t.  This is binge drinking time for the bulls, we are in the final stages of the bull market.  Another orgasmic surge is likely, then its straight downhill.
      There are three negatives that will threaten to trigger a bear market/ recession. Stocks are historically overvalued,  a widening trade war and a series of constitutional crises arising out of attempts to remove Trump from office, as well as his attempts to thwart the Mueller investigation.

     While I believe we have seen the highs for the 2009 to 2018 bull market , I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
       Bull markets don’t go gently, but this one is getting pricey. Not only is the Shiller price/earnings ratio now up to 33.7 times earnings (vs average of 16.8) the price to sales ratio is at 2.32, well above the norm of 1.48.

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SUPPORT “today”:DJIA:24,614;S&P 500:2,776;  Nasdaq Comp.:7,471
RESISTANCE “today” DJIA:24,876; S&P 500:2,766; Nasdaq Comp.:7,516
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OVERVIEW:
        I think we have seen the highs for the 2009 – 2018 bull market. There is a good chance of one more spike to new highs driven by April’s Q1 earnings which are projected by Factset to increase 17% over a year ago.

       If we get one more surge to new highs after the recent January/February 12% plunge it would be a lot like that which occurred prior to the 2007 – 2009 bear market where  an 11.4% drop in July/August  2007 was followed by a 15% rally and to a new high on October 11, 2007 before the bear market’s 50% plunge. The new high in October exceeded the July high by a mere 1.2%.  It was the ultimate breakout/fake-out.
      This is why I am referring to  a “topping out” process for the bull market.
      Odds favor a  double top with the second top coming in May after a Q1 earnings spike.
      Beyond May, I expect a steady plunge ( 14% to 18%) into fall and the mid-term elections.  A 1987 style flash crash could develop before then with the same results.  Tariffs, or the implosion of the whole Trump administration  could be the trigger.
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NINE YEARS AGO:

March 10, 2009 (DJIA: 6,805)  My “BUY”  came in the face of a total meltdown on the Street when with the DJIA down 55%, no one wanted to buy stocks which contrasts with today when just about everyone wants to go all-in and borrow to do so.                                                                    
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WHAT COULD DERAIL BULL MARKET ?

        The 2009 to 2018 bull market IS still intact. What could derail it ?

        THE NEW ERA MENTALITY
       Google this ! Classic tunnel vision bull market mentality evidenced by Bloomberg article: “Stock Bulls in Trump Country Are Freaking Out Their Brokers.”    This is how the human mind works as late-stage bull markets approach  the end.  

       The myth that the 8-year bull market is unstoppable, that the Street’s decision process based on algorithms thought to be flawless weren’t programmed for reality, that bull markets and economic expansions age, that stocks that are grossly overvalued will return to historic norms and even go lower in face of mounting fears.

          The Shiller S&P 500’s price/earnings ratio (P/E), based on average inflation-adjusted earnings over 10 years CAPE)  is now 31.7 vs. a mean of 16.8. This overvaluation cannot survive the negatives that are looming in the intermediate-term future.

          THE FED
       The Fed has raised its federal funds rate since December 2015 with no effect on the stock market and has continued to raise rates ever  since in an effort to “normalize” rates after seven years of  a zero-based interest rate policy following the Great Recession/Bear Market.
        While the 10-year Treasury recently jumped to 2.91% (20-year average: 3.74%), and the 2-year Treasury hit a 9-year high triggering a drop in stock prices, these rates have since backed  down, triggering a rebound in the stock market     
 TRUMP ADMINISTRATION IMPLODING ?
The prospect of a huge political scandal is unfolding, one which could result in a constitutional crisis. So far, the Street is in denial, and initially may ignore indictments of Trump’s closest staff, ones who have departed, maybe Trump himself.  Dysfunctional as our government is, it can get even more so, in face of  attempts to fire thwart  Special Counsel Mueller’s investigation, the removal of Trump from office (impeachment, 25th Amendment, resignation, or the presidential pardons of  administration persons.

         That uncertainty, combined with rising interest rates and the downward adjustment in stock valuations can take this market south big time.

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POLITICAL/STOCK MARKET
Editor/publisher note:
      I have  been writing about the stock market and companies for 50 years and never injected politics in my thousands of commentaries during the most dynamic and treacherous era in stock market history.
      I have published investors first read.com daily before the open since mid-2008.  On January 3, 2017, I decided to add a political commentary because I sensed Republican control of the Presidency under Donald Trump , both houses of Congress, the Supreme Court and a major network news station  would be injurious to the preservation of our republic and economy.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
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Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout  March 4.
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TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, and  CIA’s  Mike Pompeo, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
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        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
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U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
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SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
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WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
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The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
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RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
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The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
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TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
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  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government in Total Disarray

Investor’s first read.comDaily edge before the open
DJIA:25,007
S&P 500: 2,765
Nasdaq Comp.:7,511
Russell 2000: 1,592

Wednesday, March 14,  2018   7:37 a.m.
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NOT ALWAYS BEARISH –  “BUY” Mar. 10, 2009 (DJIA 6,805)
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      This is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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OVERVIEW:

        I think we have seen the highs for the 2009 – 2018 bull market. There is a good chance of one more spike to new highs driven by April’s Q1 earnings which are projected by Factset to increase 17% over a year ago.

       If we get one more surge to new highs after the recent January/February 12% plunge it would be a lot like that which occurred prior to the 2007 – 2009 bear market where  an 11.4% drop in July/August  2007 was followed by a 15% rally and to a new high on October 11, 2007 before the bear market’s 50% plunge. The new high in October exceeded the July high by a mere 1.2%.  It was the ultimate breakout/fake-out.
      This is why I am referring to  a “topping out” process for the bull market.
      Odds favor a  double top with the second top coming in May after a Q1 earnings spike.
      Beyond May, I expect a steady plunge ( 14% to 18%) into fall and the mid-term elections.  A 1987 style flash crash could develop before then with the same results.  Tariffs, or the implosion of the whole Trump administration  could be the trigger.
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TODAY:
       Again, what I have said above and below continues unchanged.
      The bulls have the ball, but the disarray  in governance in Washington  gets worse. At a time when global issues demand solutions, 8 out of 10 key positions in our State Department are vacant.
      This is unacceptable incompetence at the highest levels. Dozens of staffers have left or been fired by President Trump.
       Our economy couldn’t get  stronger, and it won’t.  This is binge drinking time for the bulls, we are in the final stages of the bull market.  Another orgasmic surge is likely, then its straight downhill.
      There are three negatives that will threaten a major extension of this bull market, none unfamiliar to readers here: Stocks are historically overvalued,  a trade war would be destructive and the Trump administration is at risk of imploding.
      So far, no one on the Street cares about any of these issues, ergo more upside.  Classic late bull market behavior.

     While I believe we have seen the highs for the 2009 to 2018 bull market , I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
       Some of Friday’s big jump can be attributed to the prospect for talks between the U.S. and North Korea in the near future, but the biggest impact came from an increase in new jobs of 313,000 in February.  That brought new buyers in off the sidelines and chased shorts.

       Bull markets don’t go gently, but this one is getting pricey. Not only is the Shiller price/earnings ratio now up to 33.7 times earnings (vs average of 16.8) the price to sales ratio is at 2.32, well above the norm of 1.48.     

      Yes, it would be nice if this source of potential war is reduced.  I am suspicious of Kim Jong Un’s motives.  Suddenly, he gets a global presence as the good guy (Trump the bad guy) – Doesn’t pass the smell test. These love-ins tend to be on again, off again as heads of state primp for an edge in the public’s eye.
       WE ARE WITNESSING THE DARKEST PERIODS IN OUR COUNTRY’S HISTORY SINCE THE CIVIL WAR.
     
 AMERICANS WILL BE EMBARASSED, EVEN SHAMED, 10 YEARS FROM NOW LOOKING BACK ON THE BLATANT ATTEMPT BY THIS ADMINISTRATION  TO DISMEMBER THE FOUNDATIONS OF OUR REPUBLIC IN AN ATTEMPT TO GUARANTEE CONTROL BY ONE PARTY – AN EXTREMIST, MILITANT, RACIST, UNDEMOCRATIC RIGHT WING. LIKE BRITAIN, THIS COULD BE AMERICA’S DARKEST HOUR, THOUGH THEIRS WAS FROM AN EXTERNAL ENEMY, OURS FROM AN INTERNAL
 ENEMY.   
       This will impact our economy and stock market. I sense it won’t be rejected until 2020 after hitting bottom. 
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NINE YEARS AGO:

March 10, 2009 (DJIA: 6,805)  My “BUY”  came in the face of a total meltdown on the Street when with the DJIA down 55%, no one wanted to buy stocks which contrasts with today when just about everyone wants to go all-in and borrow to do so.                                                                     >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
SUPPORT “today”:DJIA:24,913;S&P 500:2,751;  Nasdaq Comp.:7,499
RESISTANCE “today” DJIA:25,077; S&P 500:2,775; Nasdaq Comp.:7,517
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WHAT COULD DERAIL BULL MARKET ?

        The 2009 to 2018 bull market IS still intact. What could derail it ?

        THE NEW ERA MENTALITY
       Google this ! Classic tunnel vision bull market mentality evidenced by Bloomberg article: “Stock Bulls in Trump Country Are Freaking Out Their Brokers.”    This is how the human mind works as late-stage bull markets approach  the end.  

       The myth that the 8-year bull market is unstoppable, that the Street’s decision process based on algorithms thought to be flawless weren’t programmed for reality, that bull markets and economic expansions age, that stocks that are grossly overvalued will return to historic norms and even go lower in face of mounting fears.

          The Shiller S&P 500’s price/earnings ratio (P/E), based on average inflation-adjusted earnings over 10 years CAPE)  is now 31.7 vs. a mean of 16.8. This overvaluation cannot survive the negatives that are looming in the intermediate-term future.

          THE FED
       The Fed has raised its federal funds rate since December 2015 with no effect on the stock market and has continued to raise rates ever  since in an effort to “normalize” rates after seven years of  a zero-based interest rate policy following the Great Recession/Bear Market.
        While the 10-year Treasury recently jumped to 2.91% (20-year average: 3.74%), and the 2-year Treasury hit a 9-year high triggering a drop in stock prices, these rates have since backed  down, triggering a rebound in the stock market     
 TRUMP ADMINISTRATION IMPLODING ?
The prospect of a huge political scandal is unfolding, one which could result in a constitutional crisis. So far, the Street is in denial, and initially may ignore indictments of Trump’s closest staff, ones who have departed, maybe Trump himself.  Dysfunctional as our government is, it can get even more so, in face of  attempts to fire thwart  Special Counsel Mueller’s investigation, the removal of Trump from office (impeachment, 25th Amendment, resignation, or the presidential pardons of  administration persons.

         That uncertainty, combined with rising interest rates and the downward adjustment in stock valuations can take this market south big time.

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POLITICAL/STOCK MARKET
Editor/publisher note:
      I have  been writing about the stock market and companies for 50 years and never injected politics in my thousands of commentaries during the most dynamic and treacherous era in stock market history.
      I have published investors first read.com daily before the open since mid-2008.  On January 3, 2017, I decided to add a political commentary because I sensed Republican control of the Presidency under Donald Trump , both houses of Congress, the Supreme Court and a major network news station  would be injurious to the preservation of our republic and economy.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
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Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout  March 4.
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TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, and  CIA’s  Mike Pompeo, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
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        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
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U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
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SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
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WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
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The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
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RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
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The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
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TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
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  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Classic Late Bull Market Behavior

Investor’s first read.com Daily edge before the open
DJIA:25,178
S&P 500: 2,783
Nasdaq Comp.:7,588
Russell 2000: 1,601

Tuesday, March 13,  2018   9:07 a.m.
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NOT ALWAYS BEARISH –  “BUY” Mar. 10, 2009 (DJIA 6,805)
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      This is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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OVERVIEW:

        I think we have seen the highs for the 2009 – 2018 bull market. There is a good chance of one more spike to new highs driven by April’s Q1 earnings which are projected by Factset to increase 17% over a year ago.

       If we get one more surge to new highs after the recent January/February 12% plunge it would be a lot like that which occurred prior to the 2007 – 2009 bear market where  an 11.4% drop in July/August  2007 was followed by a 15% rally and to a new high on October 11, 2007 before the bear market’s 50% plunge. The new high in October exceeded the July high by a mere 1.2%.  It was the ultimate breakout/fake-out.
      This is why I am referring to  a “topping out” process for the bull market.
      Odds favor a  double top with the second top coming in May after a Q1 earnings spike.
      Beyond May, I expect a steady plunge ( 14% to 18%) into fall and the mid-term elections.  A 1987 style flash crash could develop before then with the same results.  Tariffs, or the implosion of the whole Trump administration  could be the trigger.
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TODAY:
      I have nothing new to add here, except yesterday’s slight pullback after Friday’s big jump was a normal technical reaction. 
      Today will be off to a good start.  Economists and Wall Street pundits are getting more and more bullish.  There are three negatives that will threaten a major extension of this bull market, none unfamiliar to readers here: Stocks are historically overvalued,  a trade war would be destructive and the Trump administration is at risk of imploding.
      So far, no one on the Street cares about any of these issues, ergo more upside.  Classic late bull market behavior.

     While I believe we have seen the highs for the 2009 to 2018 bull market , I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
       Some of Friday’s big jump can be attributed to the prospect for talks between the U.S. and North Korea in the near future, but the biggest impact came from an increase in new jobs of 313,000 in February.  That brought new buyers in off the sidelines and chased shorts.

       Bull markets don’t go gently, but this one is getting pricey. Not only is the Shiller price/earnings ratio now up to 33.7 times earnings (vs average of 16.8) the price to sales ratio is at 2.32, well above the norm of 1.48.     

      Yes, it would be nice if this source of potential war is reduced.  I am suspicious of Kim Jong Un’s motives.  Suddenly, he gets a global presence as the good guy (Trump the bad guy) – Doesn’t pass the smell test. These love-ins tend to be on again, off again as heads of state primp for an edge in the public’s eye.
       WE ARE WITNESSING THE DARKEST PERIODS IN OUR COUNTRY’S HISTORY SINCE THE CIVIL WAR.
      
 AMERICANS WILL BE EMBARASSED, EVEN SHAMED, 10 YEARS FROM NOW LOOKING BACK ON THE BLATANT ATTEMPT BY THIS ADMINISTRATION  TO DISMEMBER THE FOUNDATIONS OF OUR REPUBLIC IN AN ATTEMPT TO GUARANTEE CONTROL BY ONE PARTY – AN EXTREMIST, MILITANT, RACIST, UNDEMOCRATIC RIGHT WING. LIKE BRITAIN, THIS COULD BE AMERICA’S DARKEST HOUR, THOUGH THEIRS WAS FROM AN EXTERNAL ENEMY, OURS FROM AN INTERNAL
 ENEMY.   
       This will impact our economy and stock market. I sense it won’t be rejected until 2020 after hitting bottom. 
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NINE YEARS AGO:

March 10, 2009 (DJIA: 6,805)  My “BUY”  came in the face of a total meltdown on the Street when with the DJIA down 55%, no one wanted to buy stocks which contrasts with today when just about everyone wants to go all-in and borrow to do so.                                                                     >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
SUPPORT “today”:DJIA:;S&P 500:;  Nasdaq Comp.:
RESISTANCE “today” DJIA:; S&P 500:; Nasdaq Comp.:
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WHAT COULD DERAIL BULL MARKET ?

        The 2009 to 2018 bull market IS still intact. What could derail it ?

        THE NEW ERA MENTALITY
       Google this ! Classic tunnel vision bull market mentality evidenced by Bloomberg article: “Stock Bulls in Trump Country Are Freaking Out Their Brokers.”    This is how the human mind works as late-stage bull markets approach  the end.  

       The myth that the 8-year bull market is unstoppable, that the Street’s decision process based on algorithms thought to be flawless weren’t programmed for reality, that bull markets and economic expansions age, that stocks that are grossly overvalued will return to historic norms and even go lower in face of mounting fears.

          The Shiller S&P 500’s price/earnings ratio (P/E), based on average inflation-adjusted earnings over 10 years CAPE)  is now 31.7 vs. a mean of 16.8. This overvaluation cannot survive the negatives that are looming in the intermediate-term future.

          THE FED
       The Fed has raised its federal funds rate since December 2015 with no effect on the stock market and has continued to raise rates ever  since in an effort to “normalize” rates after seven years of  a zero-based interest rate policy following the Great Recession/Bear Market.
        While the 10-year Treasury recently jumped to 2.91% (20-year average: 3.74%), and the 2-year Treasury hit a 9-year high triggering a drop in stock prices, these rates have since backed  down, triggering a rebound in the stock market     
 TRUMP ADMINISTRATION IMPLODING ?
The prospect of a huge political scandal is unfolding, one which could result in a constitutional crisis. So far, the Street is in denial, and initially may ignore indictments of Trump’s closest staff, ones who have departed, maybe Trump himself.  Dysfunctional as our government is, it can get even more so, in face of  attempts to fire thwart  Special Counsel Mueller’s investigation, the removal of Trump from office (impeachment, 25th Amendment, resignation, or the presidential pardons of  administration persons.

         That uncertainty, combined with rising interest rates and the downward adjustment in stock valuations can take this market south big time.

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POLITICAL/STOCK MARKET
Editor/publisher note:
      I have  been writing about the stock market and companies for 50 years and never injected politics in my thousands of commentaries during the most dynamic and treacherous era in stock market history.
      I have published investors first read.com daily before the open since mid-2008.  On January 3, 2017, I decided to add a political commentary because I sensed Republican control of the Presidency under Donald Trump , both houses of Congress, the Supreme Court and a major network news station  would be injurious to the preservation of our republic and economy.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
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Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout  March 4.
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TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, and  CIA’s  Mike Pompeo, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
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        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
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U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
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SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
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WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
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The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
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RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
.…………………………
The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
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TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
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  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

 

 

 

 

 

 

 

One More Spike to New Highs ?

Investor’s first read.comDaily edge before the open
DJIA:25,335
S&P 500: 2,787
Nasdaq Comp.:7,566
Russell 2000: 1,597

Monday, March 12,  2018   9:07 a.m.
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NOT ALWAYS BEARISH –  “BUY” Mar. 10, 2009 (DJIA 6,805)
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      This is EXACTLY what I meant  December 27,  when I Warned:
“2018: The Wildest One in Years.”
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OVERVIEW:

        I think we have seen the highs for the 2009 – 2018 bull market. There is a good chance of one more spike to new highs driven by April’s Q1 earnings which are projected by Factset to increase 17% over a year ago.

       If we get one more surge to new highs after the recent January/February 12% plunge it would be a lot like that which occurred prior to the 2007 – 2009 bear market where  an 11.4% drop in July/August  2007 was followed by a 15% rally and to a new high on October 11, 2007 before the bear market’s 50% plunge. The new high in October exceeded the July high by a mere 1.2%.  It was the ultimate breakout/fake-out.
      This is why I am referring to  a “topping out” process for the bull market.
      Odds favor a  double top with the second top coming in May after a Q1 earnings spike.
      Beyond May, I expect a steady plunge ( 14% to 18%) into fall and the mid-term elections.  A 1987 style flash crash could develop before then with the same results.  Tariffs, or the implosion of the whole Trump administration  could be the trigger.
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TODAY:
     While I believe we have seen the highs for the 2009 to 2018 bull market , I have referred to the possibility of one final break out to new highs before June, similar to that which took place before the bull market top preceding the 2007 – 2009 bear market, the one that took the S&P 500 down 55%. (see above)
      A move like that would be fueled by Q1 earnings, which are projected to grow by 17% over a year ago and will be reported in April/May.
      The Nasdaq Comp has already topped its January high of 7,505, but the DJIA and S&P 500 must cross DJIA: 26,616 (S&P 500: 2,872) to follow suit.
       Some of Friday’s big jump can be attributed to the prospect for talks between the U.S. and North Korea in the near future, but the biggest impact came from an increase in new jobs of 313,000 in February.  That brought new buyers in off the sidelines and chased shorts.

       Bull markets don’t go gently, but this one is getting pricey. Not only is the Shiller price/earnings ratio now up to 33.7 times earnings (vs average of 16.8) the price to sales ratio is at 2.32, well above the norm of 1.48.
     

      Yes, it would be nice if this source of potential war is reduced.  I am suspicious of Kim Jong Un’s motives.  Suddenly, he gets a global presence as the good guy (Trump the bad guy) – Doesn’t pass the smell test. These love-ins tend to be on again, off again as heads of state primp for an edge in the public’s eye.
       WE ARE WITNESSING THE DARKEST PERIODS IN OUR COUNTRY’S HISTORY SINCE THE CIVIL WAR.
     
 AMERICANS WILL BE EMBARASSED, EVEN SHAMED, 10 YEARS FROM NOW LOOKING BACK ON THE BLATANT ATTEMPT BY THIS ADMINISTRATION  TO DISMEMBER THE FOUNDATIONS OF OUR REPUBLIC IN AN ATTEMPT TO GUARANTEE CONTROL BY ONE PARTY – AN EXTREMIST, MILITANT, RACIST, UNDEMOCRATIC RIGHT WING. LIKE BRITAIN, THIS COULD BE AMERICA’S DARKEST HOUR, THOUGH THEIRS WAS FROM AN EXTERNAL ENEMY, OURS FROM AN INTERNAL
 ENEMY.   
       This will impact our economy and stock market. I sense it won’t be rejected until 2020 after hitting bottom. 
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NINE YEARS AGO:

March 10, 2009 (DJIA: 6,805)  My “BUY”  came in the face of a total meltdown on the Street when with the DJIA down 55%, no one wanted to buy stocks which contrasts with today when just about everyone wants to go all-in and borrow to do so.                                                                     >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
SUPPORT “today”:DJIA:25,267;S&P 500:2,781;  Nasdaq Comp.:7,541
RESISTANCE “today” DJIA:25,413; S&P 500:2,797; Nasdaq Comp.:7,597
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WHAT COULD DERAIL BULL MARKET ?

        The 2009 to 2018 bull market IS still intact. What could derail it ?

        THE NEW ERA MENTALITY
       Google this ! Classic tunnel vision bull market mentality evidenced by Bloomberg article: “Stock Bulls in Trump Country Are Freaking Out Their Brokers.”    This is how the human mind works as late-stage bull markets approach  the end.  

       The myth that the 8-year bull market is unstoppable, that the Street’s decision process based on algorithms thought to be flawless weren’t programmed for reality, that bull markets and economic expansions age, that stocks that are grossly overvalued will return to historic norms and even go lower in face of mounting fears.

          The Shiller S&P 500’s price/earnings ratio (P/E), based on average inflation-adjusted earnings over 10 years CAPE)  is now 31.7 vs. a mean of 16.8. This overvaluation cannot survive the negatives that are looming in the intermediate-term future.

          THE FED
       The Fed has raised its federal funds rate since December 2015 with no effect on the stock market and has continued to raise rates ever  since in an effort to “normalize” rates after seven years of  a zero-based interest rate policy following the Great Recession/Bear Market.
        While the 10-year Treasury recently jumped to 2.91% (20-year average: 3.74%), and the 2-year Treasury hit a 9-year high triggering a drop in stock prices, these rates have since backed  down, triggering a rebound in the stock market     
 TRUMP ADMINISTRATION IMPLODING ?
The prospect of a huge political scandal is unfolding, one which could result in a constitutional crisis. So far, the Street is in denial, and initially may ignore indictments of Trump’s closest staff, ones who have departed, maybe Trump himself.  Dysfunctional as our government is, it can get even more so, in face of  attempts to fire thwart  Special Counsel Mueller’s investigation, the removal of Trump from office (impeachment, 25th Amendment, resignation, or the presidential pardons of  administration persons.

         That uncertainty, combined with rising interest rates and the downward adjustment in stock valuations can take this market south big time.

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POLITICAL/STOCK MARKET
Editor/publisher note:
      I have  been writing about the stock market and companies for 50 years and never injected politics in my thousands of commentaries during the most dynamic and treacherous era in stock market history.
      I have published investors first read.com daily before the open since mid-2008.  On January 3, 2017, I decided to add a political commentary because I sensed Republican control of the Presidency under Donald Trump , both houses of Congress, the Supreme Court and a major network news station  would be injurious to the preservation of our republic and economy.
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George Nader, Who he ?  Possibly a key source of information. This is highly complicated with new information pending. Nader has long-standing ties in the Mid-East and Washington over many years.  What appears to be important here is he is cooperating with the Mueller probe not as a wrongdoer, but as a source of information.  He has had ties with the Trump administration through Steve Bannon  and reportedly attended a meeting in the Seychelles Islands January 11, 2017 along with Blackwater founder and former Trump associate, Eric Prince, and Kirill Dmitriev head of a U.S. sanctioned investment firm with close ties to Putin.  Reportedly Nader represented United Arab Emirates’ Crown Prince Mohammed bin Zayed Al-Nahyan.
      I referred to the Seychilles meeting on April 5, 2017 noting  the Washington Post reported the meeting was intended to encourage Russia to curtail support for Iran and Syria (Trump wish list) in exchange for lifting U.S. sanctions on Russia.
We’ll see.
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Protecting guns and profits have become more important than protecting the lives of young people” Henry A. Giroux, Truthout  March 4.
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TRUMP ADMINISTRATION IMPLODING.  TRUMP SETTING STAGE FOR FIRING SESSIONS .
      When the boss starts to find fault with an employee for little things, out of nowhere, and for little reason, it’s lights out.
      It looks like a death spiral for this administration is unfolding, 30 aides just lost top secret clearance; communications director, Hope Hicks, resigned . My guess is she has struck a deal with Mueller, who is ratcheting up the pressure on the big Kahuna.
      Is this how General Custer felt in the last hour at Little Big Horn ?
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      Tsunami of anti-gun sentiment finally raging. High school students in Florida are organizing to force Trump, Congress and the NRA to take action.  Banks considering  measures to deny credit financing of gun purchases and advertising.
      Less than a week after the Parkland shootings, Florida lawmakers rejected an attempt to ban assault rifles and large capacity magazines. Big mistake.
      These lawmakers can be replaced, the dead students can’t.
      The outrage is just beginning.  It is estimated that just 3% of Americans own half of the 265 million guns in the country.  The NRA and supporters are out- gunned.
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Why are so many Americans beholden to guns ? It could be their sense of security was rocked by 9/11 plus the Great Recession/Bear Market.  Then it could be racial, a fear that people of different colors will eventually outnumber them, prompting  the need (in their paranoid minds) to stage a forceful change in governance (revolution).  This makes little sense, but from their point of  simplemindedness, they feel more secure with a dozen guns and cases of ammunition in house just in case.
     What these whackos don’t understand is they can’t use their guns outside of their homes for fear of injuring or killing an innocent person which not only sends them to jail, but opens them up to a lawsuit where they lose their stock portfolio, car, house and all those “blankies” that  go bang.  ………………………………………

 

A quasi-fascist state would give Trump the untethered power he craves.
Read: The Ghost of Fascism in the Age of Trump

http://www.truth-out.org/news/item/43529-the-ghost-of-fascism-in-the-age-of-trump
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Number 3 at DOJ, Rachael Brand, resigns at DOJ (see below)
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WILL TRUMP FIRE MUELLER ? LOOK FOR THIS  TIP-OFF

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  A new appointment to the DOJ may signal Trump’s intent.
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ who will.  Rachel Brand, a conservative who supported Sen. Cruz in 2017 would be in line to take over from Rosenstein, but she just announced she is resigning from DOJ (2?9/19)      Trump must find someone in DOJ to fire Mueller if he wants to do it.    

      DOJ’s Dana Bounte’s resignation last October and his recent  appointment by FBI Director Christopher Wray as general Counsel  for the FBI takes him out of the running, though it is doubtful he would have fired Mueller.   He served as the U.S. Attorney General from the Eastern Dist. of Virginia, as well as, acting assistant attorney general  for the National Security Division of DOJ.     
        Trump has appointed (pending confirmation) former Boeing General Counsel, John Demers, to assume  Boente’s position as U.S. attorney in the Eastern District of Virginia. He could do it, but he has promised to support the Mueller investigation.
      Unconfirmed rumors are that EPA’s Scott Pruit has shown an interest in the DOJ, and  CIA’s  Mike Pompeo, is a possibility for a post. there.   Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       REASONS NEEDED TO FIRE MUELLER: Trump would have to have  good reason to fire Mueller.  Grounds must be, misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of policies of the Department of Justice, and failure to follow Justice Departments guidelines and violation of applicable canons of ethics.
       CAN TRUMP RESCIND  SPECIAL COUNSEL REGULATION ?  Yes, it’s possible but many legal hurdles  would make it difficult and possibly so time consuming as to make the action worthless. There is no clear cut answer. This would be decided in court, the legal ramifications just very complex.
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        FYI: The S&P 500 gained 36.6% in Obama’s first year, but only 23.7% under Trump. Obama inherited the worst bear market since the 1930’s, Trump inherited an accelerating bull market supported by a stable economy. If Obama’s first year gain is calculated from the Bear market bottom  March 6, 2009 shortly after he assumed office, the gain would be 74.2%.
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U.S. Ranking globally and domestically is plunging under Trump
      Global approval of U.S. leadership from 134 countries has plunged to 30% from 48% in just a year.  Clearly, Trump isn’t making America Great Again in the eyes of all other countries. 
The downside of this is we need the support of those countries.  Our nationalistic policies are opening doors throughout the world for China. A Gallup poll shows Germany replacing the U.S. as the top-rated power in the world.
      Under Trump, the United States has dropped to 11th place in the Bloomberg Innovation Index, which in addition  to  R&D spending, includes post secondary, or tertiary, education-efficiency category, which includes the share of new science and engineering graduates. Value-added manufacturing also dropped.  South Korea ranked first, followed by Sweden, Singapore, Germany, Switzerland, Japan, Finland, Denmark, France, Israel.
       Also under Trump, Americans’ trust in institutions (government, companies and the  media) has suffered the greatest loss on record according to a poll conducted by Edelman New York. The poll, including 33,000 “informed” individuals showed the U.S. dropping to 43 out of a possible 100, down 23 points in a year.  He is a human wrecking ball.
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SOLUTION for our nation’s problems: Deport Trump’s base. Not the Republicans who vote their party because they are genuinely conservative, but the racist, violent, abusive element that opts for dumbing down solutions for issues because experienced and intelligent people remind them how incapable they are of emotionally and mentally developing rational, unbiased conclusions for issues  without bias that serve the best interests of all Americans.
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According to the Washington Post, Trump’s false or misleading statements (lies) now exceed 2,000 after his first year.
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WOULD ANYONE WANT their spouse to lie repeatedly ?, their child ?, mother ?, father ?, minister ?, child’s teacher ?,  coach ?, employer ?.  IF NOT, why would they support President Trump who is on record with telling 4.5 lies per day, 2,000 lies since his inauguration on January 20 ?.
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CORPORATE TAX CUT IRRESPONSIBLE
“It's pure fantasy to think that the tax bill will lead to significantly higher wages and growth, as Republicans have promised,” Bloomberg continued. Had Congress actually listened to executives, or economists who study these issues carefully, it might have realized that. The tax bill is an economically indefensible blunder that will harm our future” –   Michael Bloomberg – billionaire business man former mayor NYC

      I don’t doubt some corporations need, and deserve a tax cut, but to reduce the rate from 35% to 21% is inexcusable, reckless, unjustifiable, and outright subversive to the best interests of America.
      Corporate income taxes comprise 9% of federal government receipts. If corporate taxes are slashed by 40% (from 35% to 21%), the government’s receipts from corporations are reduced by 3.6% from 9%.
      Individual income tax payments comprise 47% of  federal government receipts
. At this point, I have no idea how much of an impact  Congress’ tax cuts will have on this source of federal revenues, but it stands to be significant.
      The Republican administration expects economic growth will be triggered by a sudden change in heart by corporations to abandon stock buybacks and the repatriation of billions stashed abroad to plug the big hole left in federal receipts by tax cuts with a surge in hiring and capital expenditures.
      That assumption is flawed. For one, why would a corporation  go on a hiring and cap-ex spending spree  with an economic expansion that  is 8-1/2 years old, 3 years longer (73%) than the average over 65 years (1945 – 2009).
      For another, are they naïve enough to assume there will be no recessions within the next 10 years ?
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The Institute on Taxation and Economic Policy released a study on “Corporate Tax Avoidance by Fortune 500 Companies”:  The report includes 258 corporations that were consistently profitable over an eight-year period between 2008 and 2015. Some conclusions:
-of 258 Fortune 500 companies studied, the effective federal income tax rate was 21.5%
18 of the 258 paid no income tax and 48 paid an effective tax rate of 10%.
83 companies (32%) paid a tax rate less than 17.5%
109 companies (42%)  paid a tax rate between 17.5% and 30%.
66 companies (26%) paid a tax rate greater than 30%
NOTE: The University of Pennsylvania’s Wharton School estimates the  effective tax rate  for corporates will drop to 9.2% as a result of  tax reform.
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RED STATES NEED FED’s HELP THE MOST

       The twelve most federally dependent states are Kentucky, Mississippi, New Mexico, Alabama, West Virginia, South Carolina, Montana, Tennessee, Maine,  Indiana, Arizona, Louisiana.
      The twelve least federally dependent states are Delaware, Minnesota, New Jersey, Illinois, California, Kansas, Nevada, Massachusetts, Connecticut, New Hampshire, and Utah, and Nebraska.
  Red states (Republican) are 67% more dependent on federal government aid than Blue States (Democratic).
So why all the whining about the Feds being in their space ?  Want to go it alone ?   Careful
what you wish for   
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The BIG question is, do American morals and respect for our republic  have to hit bottom before Congress and the American voter opts for decency, honesty, integrity and a moral compass ?
    Currently, odds favor neither will have a change of heart even if the findings of the Mueller probe uncover untold crimes against the constitution and American people. 
     The current extremist Republican Party is morally bankrupt, as are many of its supporters. Much of the Republican Congress is comprised congressional  anarchists, determined to raze time-tested checks and balances, and oppose any and all new proposals that do not pass their muster.
      It wasn’t enough that they obstructed progress for eight years of the Obama administration, they are now dismantling the things he did accomplish. Our republic is being mugged in plain sight.
    
There are a lot of very fine Republicans out there, but someone needs to tell them someone hijacked their party.
       This isn’t Reagan, this isn’t anything close to the Republican Party I grew up with.

       This is what the right wing has been waiting for – total control of the presidency, both Houses, and the Supreme Court. (and Fox News)  They want total control.  This is how democratic,  representative republics  perish.
      America is the biggest enchilada on earth.  Why wouldn’t a group of extremists want to wrest permanent control from its people ?  Americans must stop multitasking, and have the guts to endure the day-to-day angst that accompanies being well informed. They need to return to values.
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Brian Benczkowski was nominated by President Trump in June to be U.S. Assistant Attorney General for the Criminal Division. My  Sept. 15 post called attention to this since he previously represented one of Russia’s largest banks Russia’s Alfa Bank. Having  advanced out of the Senate Judiciary Committee, his nomination is pending full Senate confirmation. He once served under Jeff Sessions. If confirmed, he pledged independence, recusing himself for two years from any dealings with alfa Bank.  Sen. Feinstein voted against Benczkowski concerned that he never served as a federal prosecutor and the fact he would sit in on  meetings with special counsel Robert Mueller with Russia probe. Sen. Sheldon Whitehouse, D-R.I., was concerned his major qualification was his connection with Sessions.
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Mercer on the run ?  Bannon and Breitbart bankroller, Robert Mercer is rapidly severing financial ties to Breitbart News and support of Steve Bannon and alt-right’s Milo Yiannopoulos. Mercer was a major supporter of Sen. Ted Cruz’s effort to gain the Republican nomination last year, but switched his allegiance to Trump when he won the nomination.
      In my March 21 post, I wrote, “Years from now, I suspect Mercer will be relaxing at his Long Island waterfront retreat, Owl’s Nest, or on his 200-foot yacht, Sea Owl, and look back over his illustrious career tarnished  by one regret – he backed the biggest con job in our nation’s history.”

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Six states (Arkansas, Indiana, Kentucky, Maine, Utah, Wisconsin),  are planning to require poverty stricken people on Medicaid  to get jobs  or lose the coverage. Maine, Utah and Wisconsin want to put a time limit on coverage, the latter wants to drug-test people. Excluded: People with long-tern disabilities, the elderly, and children.  Isn’t it bad enough these people are in poverty ? 
      Vox Media reports that 9.8 million Medicaid recipients  don’t have jobs  due to: Illness/disabled (35%), retired (8%), taking care of home or family (28%), going to school (18%), cannot find work (8%). The remaining 60.2 million Americans on Medicaid work full-time of part-time.  I’m not sure what’s the Republican beef here.
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TRUMP’S PARDON POWER
    
The President has the power to grant conditional pardons; to commute sentences; remit fines and forfeitures; and grant amnesty. This power can be exercised at any time after the offense has been committed, before conviction of after. Pardons cannot be limited by or controlled by legislative action (US legal.com)
Expect Trump to attempt to pardon anyone he wants, including himself. It’s a way out of facing responsibility very much like dodging the draft. Like when he justified his numerous bankruptcies, saying he only used U.S. laws to his advantage.  Well, “pardons” are his prerogative, in many, not all cases. He would take advantage of whatever loophole to avoid consequences, sort of like dodging the draft, or did I already say that ?
     The President cannot pardon people for “state” crimes, and it is doubtful he can pardon himself.
      Can the Mueller investigation survive Mueller’s firing ?

Slate.com’s July 21 article, “Trump can’t Escape the States,” says “YES.”

1-A state [NY] could hire Mueller and team.
2-State attorneys general could use their quo warranto power to investigate Trump’s organization for fraud and money laundering from Russian sources.
3-A Congressional committee (Senate Intelligence Committee) could hire Mueller or create a Joint select Committee.
4-Congress could pass a new veto-proof independent counsel statute.
FINALLY: If Trump resigns and Pence takes over, Pence could pardon Trump, as Ford did Nixon.
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THE GREAT AMERICAN EXPERIMENT UNDER SEIGE:  Not since the Civil War has the spirit and future of our nation been at such great risk, from within.  This  administration, Congress and U.S. Supreme Court is surgically dismembering  efforts over many years to ensure the safety  and well being of “all” Americans.
     The sooner, Americans recognize these are not genuine Republican conservatives, but extremists determined dismantle that which has been achieved over the years and replace it with “their” brand  of a  quasi-fascist state.  Ben Franklin was right when asked what kind of government  the Founding Fathers had given us.  “A Republic, if you can keep it,” was his respons.
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TRUMP looking for a “Get Out Of Jail Free Card if the Feds close in?”
   
Why not, he dodged military service with 5 deferments  during the Vietnam era (1964 – 1970).
     Reportedly, he has asked advisers about his power to pardon family members and himself  relating to Mueller’s investigation.
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WHAT HAPPENS WHEN THE INVESTIGATION IS COMPLETED ? If the Special Counselor  concludes it is “necessary and appropriate” he is authorized to prosecute federal crimes arising out of the investigation, which he does after submitting a report to the attorney general explaining his reasons.

REASONS NEEDED TO FIRE MUELLER:  Misconduct,  dereliction of duty, incapacity, conflict of interest, good cause (??), violation of Department policies.
WOULD MUELLER BE REPLACED ? Unclear. If the Democrats controlled Congress they could appoint another Special Counselor
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  “Connect the Dots.” This investigation is open-ended. These are people were part of the Trump team, or in a position to know information relating to activities before or after the 2016 election, though  not necessarily in any way guilty of any wrongdoing.
       Nigel Farage – President Trump- Hope Hicks, Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald, Jr.  and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Michael T. Flynn – Michael G. Flynn ( son)  – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart News – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Sam Clovis –  Kellyanne and George Conway –Dana Rohrabacher – Bill Browder – Peter W. Smith (deceased: suicide), Paul Behrends – Brad Parscale – Sam Nunberg – Dan Scavino – Keith Schiller –  Alex Van Der waan – Boris Epshteyn, Ike Kaveladze, and  Russia’s alfa Group – Felix Sater – Rob Goldstone – alfa Group – Emin Agalarov – Sergey Gorkov –  Sergey Kislyak, ambassador to the U.S., Natalia Veselnitskaya, Oleg Deripaska all connect directly or indirectly to the Trump/Russia investigation and some have a connection to Brexit, as well.
      According to the “Observer,” Mercer’s Cambridge Analytica was connected with Canada’s AggregateIQ through an intellectual property agreement and worked together on the Brexit referendum. Aggregate is also a data mining company. While Mercer was a big supporter of Trump, there is no known connection between AggregateIQ and Trump’s campaign staff.
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     REMOVING TRUMP FROM  OFFICE

Can Section 4 of the 25th Amendment, U.S. Constitution – Remove Trump ?
      It’s a stretch. 
The key for his removal is ”that he is unable to discharge the powers and duties of his office.”  Section 4 mentions nothing  that he is unfit, delusional, unbalanced, crazy,  impulsive, irrational, impaired, sociopathic, psychopathic, narcissistic.
      That would be the threshold that would have to be crossed if Trump is removed from office via Section 4 of the 25th Amendment of the U.S. Constitution. There is no precedent

      It isn’t just Democrats, liberals, moderates and reasonable people who find Trump caustic, and dangerous, conservatives like George Will, David Brooks and Ross Douthart are also urging his removal.
      First, there are four ways to get rid of Trump – death, resignation, impeachment and Section 4 of the 25th Amendment.
      The procedure employing the 25th Amendment requires the Vice President and the majority of the cabinet of 15 (8) to vote to remove the president. They would submit their declaration in writing to the President pro tempore ( Sen. Orrin Hatch) and Speaker of the House (Paul Ryan) that the president is unable to discharge the powers and duties of his office, and the Vice President will immediately assume to office as acting president.
      However, the president may contend the move by submitting his own letter to the President pro tempore and Speaker of the House, that he believes he is capable of performing his duties, in which case he will resume the office of presidency.
       The Vice President and Cabinet members may then resubmit their declaration at which point Congress would vote within 48 hours if in session. If not, Congress  will act within 21 days where a two-thirds vote would be required to remove  him.  
        However, as “Business Insider.com” noted on Jan. 9, 2018, Trump could simply fire the Cabinet members who voted to oust him from office.
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IMPEACHMENT
      A  Consult/Politico poll shows 43% of Americans want Congress to begin procedures for the impeachment of President Trump.

      The U.S. Constitution  enables Congress to remove a president for “treason, bribery, or other high crimes and misdemeanors.” Initially, the House votes on one or more articles of impeachment- if a majority vote is reached, he is impeached.  BUT, impeachment only means indictment. The Senate holds a trial overseen by the chief justice and Supreme Court. A group of House members serve as prosecutors and the Senate as jurors. If two-thirds of the senators find the president guilty, he is removed from office and the vice president takes over.

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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.